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Western Equipments and Supply Co. v. Westerns standing to sue.

Lower court
Reyes granted. Hence, this suit.
Dec. 2, 1927
Johns Issue and Dispositive:
Digest by PS Magno Does Western have standing to sue? Yes. This
is a suit for unfair competition, not a suit for
Short Version: infringement of trademark.
Western is foreign company engaged in dealing
with telephone equipment and apparatus. Is Ratio:
seeks to prevent Reyes et al, from Has an unregistered corporation which has not
incorporating a domestic corp in the PH with transacted business in the Philippine Islands,
substantially the same name, while Reyes et al, but which has acquired a valuable goodwill and
question Westerns capacity to sue since it is high reputation therein, through the sale, by
no licensed to do business in the PH. The SC importers, and the extensive use within the
ruled that Western has standing. In doing so, it Islands of products bearing either its corporate
distinguishes between infringement of name, or trade-mark consisting of its corporate
trademark suits, and suits for unfair name, a legal right to restrain an officer of the
competition. This case falls under unfair Commerce and Industry, with knowledge of
competition, and Western does not need a those facts, from issuing a certificate of
license in order to have standing. incorporation to residents of the Philippine
Islands who attempt to organize a corporation
Facts: for the purpose of pirating the corporate name
Western is a foreign corp (Nevada and New of such foreign corporation, of engaging in the
York) engaged in the business of telephone same business as such foreign corporation, and
equipment and apparatus. It must be noted of defrauding the public into thinking that its
that is has been engaged in commerce and is goods are those of such foreign corporation,
well known in the trade in all countries of the and of defrauding such foreign corporation and
world for 50 years, and at the time of the suit, its local dealers of their legitimate trade?
most of the telephone equipment used in the Paos note: I dont exactly understand
PH were manufactured and sold by Western. It why Western is considered as a corp
is alleged that of such equipment used NOT doing business in the PH since it
around the world has been manufactured has already applied for a provisional
and/or sold by Western. license which was then made
Western Electric Company, Inc. has permanent. But I think it has to do with
been registered as a trade-mark under the fact that Western agreed to such
the Act of Congress of Feb. 20, 1905 stipulation of facts during the pre-trial
Note that Western has applied for a
provisional license to engage in SC says yes, Western has standing
business in the PH on May 20, 1926, Generally, opponents who want to
and this was made permanent on Aug. question the standing of foreign corps
23, 1926 must follow this rule:
o The noncompliance of a foreign
Defendants OBrien, Diaz, Mapoy, and Zamora corporation with the statute
all seek to incorporate a domestic corporation may be pleaded as an
in the PH to be known as Western Electric affirmative defense. Thereafter,
Company, Inc. it must appear from the
Note that all of them have been evidence, first, that the plaintif
associated with Western as employees, is a foreign corporation,
or stockholders, or agents, whatever second, that it is doing
The point is, they have actual business in the Philippines, and
knowledge of the company and how it third, that it has not obtained
does its business the proper license as provided
by the statute. (Marshal-Wells
Defendant Reyes is the Director of Bureau of Co. v. Elser & Co.)
Commerce and Industry. Reyes subsequently But, it must be noted that the sole
has made known to the would-be incorporators purpose of the action of Western is to:
that he intends to rule in their favor, amidst a o To protect its reputation, its
protest from Western. corporate name, its goodwill,
whenever that reputation,
Western sough a temporary restraining order corporate name or goodwill
from the lower court. Defendants question have, through the natural
development of its trade, In the former, title to the trade-marks
established themselves." is indispensable to a good cause of
Western contends that its rights to the action;
use of its corporate and trade name: in the latter, no proprietary interest in
o Is a property right, a right in the words, names, or means by which
rem, which may assert and the fraud is perpetrated is requisite to
protect against all the world, in maintain a suit to enjoin it.
any of the courts of the world o It is sufficient that the
even in jurisdictions where it complainant is entitled to the
does not transact business custom the goodwill of a
just the same as it may protect business, and that this goodwill
its tangible property, real or is injured, or is about to be
personal, against trespass, or injured, by the palming of of
conversion. the goods of another as his.
o Since it is the trade and not
the mark that is to be protect, SC notes that the purpose and intent of the
a trade-mark acknowledges no defendants is was to unfairly and unjustly
territorial boundaries of compete in the PH with Western in (the
municipalities or states or manufacture and selling of telephone
nations, but extends to every equipment and apparatus)
market where the trader's They are basically asking the
goods have become known and Government of the PH to permit them
identified by the use of the to pirate the name of Western, by
mark. incorporating xxx
So that they may deceive the public
SC agrees with Western, saying that into thinking that the goods they are
defendants are confused as to Westerns manufacturing and selling are those of
standing because the failed to distinguished the real (Western)
between suits for unfair competition, and suits It would be a prostitution of the
for infringement of trademark powers of government to allow such
xxx a confusion of the bases of two an act
classes of suits, those for
infringements of trade-marks, and
those for unfair competition in trade