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Legal finesseNewsletter of FORTUN NARVASA & SALAZA Rwww.fnslaw.com.phINTELLECTUAL PROPERTY UPDATENOVEMBER 2013In Republic Gas Corporationv. Petron Corporation et, al.(G.R. No. 194602, June17, 2013), the SupremeCourt held that, asidefrom trademark infringement,the unauthorizeddistribution of liquefiedpetroleum gas (LPG) usingtanks that bear themarks of known and duly-registered corporationsis an act of unfair competition.Petron Corporation andPilipinas Shell are two ofthe largest bulk suppliersand producers of LPG inthe Philippines. Petron isthe registered owner ofthe trademark GASULand GASUL cylindersused for its LPG products.Shell, on the otherhand, is the authorizeduser of the trademarkSHELLANE in connectionwith the production,sale and distribution of itsLPGs.Petron and Shell receivedreports that certain entitieswere engaged in theunauthorized refilling,sale and distribution ofLPG cylinders bearingtheir registered tradenamesand trademarks.The National Bureau ofInvestigation acted uponthe letter-complaint ofFILLING UP ANOTHER’SMARKED CONTAINER ALSOUNFAIR COMPETITIONPetron and Shell and conductedan undercoveroperation wherein severalNBI agents posed as customersof these LPG refillers,including RepublicG a s C o r p o r a t i o n(REGASCO). After theagents had their emptyLPG containers refilledby REGASCO, they wereable to obtain a warrantto search REGASCO’spremises and confiscateseveral empty and filledSHELLANE and GASULcylinders.The Department of Justicedismissed the criminalcomplaint contendingthat refilling of themarked cylinders doesnot constitute an offensein itself and the consumersknew that cylindersdid not come fromPetron nor Shell afterbeing re-filled byREGASCO.The High Tribunal reversedthe DOJ andfound REGASCO liablenot only for trademarkinfringement but alsounfair competition.Citing Superior CommercialEnterprises v. Kunnan Enterprises(G.R. No. 169974,April 20, 2010) whichinvolved KENNEX sportinggoods and equipment,the Supreme Court reiteratedthat unfair competitionis defined as thepassing off or attemptingto pass off upon the publicof the goods or businessof one person as thegoods or business of anotherwith the end andprobable effect of deceivingthe public. This usuallyhappens when a personuses imitative deviceson the general appearanceof the goods, which inturn misleads prospectivepurchasers into buying hisproducts instead of thoseof his competitors.Such deceit exists herewhen REGASCO refilledand sold its LPG containersbearing the registeredmarks of Petron andShell. The Court observedthat the consumersmay be misled into believingthat the LPGs containedin the cylinders(Continued to next page.)Lou Bryan R. Macabodbod(lbrmacabodbod@fnslaw.com.ph)Intellectual PropertyPractice GroupKey Lawyers:Philip Sigfrid A. FortunRoderick R.C. Salazar IIIBayani B. LosteWalter Robin C. GoAlbert Lee G. AngelesRianne M. Picar-DanaoAsisclo A. Castañeda IIIVanessa J. GumbanLou Bryan R. MacabodbodAna Theressa D. Singcol1

earing the marks GASUL andSHELLANE are those goods orproducts of REGASCO when,in fact, they are not.On the other hand, trademarkinfringement, which consists ofthe unauthorized use of a containerbearing a registeredtrademark in connection withthe sale, distribution or advertisingof goods and serviceswhich is likely to cause confusion,mistake or deceptionamong the buyers or consumers,was also present in thiscase as REGASCO refilled themarked containers withoutPetron and Shell’s consent. TheHigh Court allowed the criminalprosecution of REGASCO’scorporate officers to proceed.LF©November 20, 2013.FNSLAW@INFO.COM.PH© 2013 Fortun Narvasa &Salazar. This update is forinformational purposeonly. If you need legaladvice, kindly get intouch with your counsel.fnslaw@info.com.phNOVEMBER 20132