Republic of the
SUPREME COURT
THIRD DIVISION
COMPANIA GENERAL DE G.R. No. 161051
TABACOS DE FILIPINAS and
LA FLOR DE LA ISABELA, INC.,
Petitioners,
Present:
YNARES-SANTIAGO, J., Chairperson,
- versus - CHICO-NAZARIO,
VELASCO,
JR.,
NACHURA,
and
HON. VIRGILIO A. SEVANDAL, PERALTA,
JJ.
as Director and DTI Adjudication
Officer, ATTY. RUBEN S.
EXTRAMADURA, as Hearing
Officer – Office of the Legal Affairs,
Department of Trade and Industry,
TABAQUERIA DE FILIPINAS,
INC., and GABRIEL Promulgated:
RIPOLL, JR.,
Respondents. July 23, 2009
x-----------------------------------------------------------------------------------------x
D E C I
S I O N
VELASCO,
JR., J.:
The
Case
This Petition for Review on Certiorari
under Rule 45 seeks the reversal of the
The Facts
Petitioner
Compania General de Tabacos de Filipinas, also known as “Tabacalera,” is a
foreign corporation organized and existing under the laws of
Respondent
Gabriel Ripoll, Jr. was an employee of petitioners for 28 years and was the
General Manager before he retired sometime in 1993.[3] In
the same year, Ripoll organized Tabaqueria de Filipinas, Inc. (Tabaqueria), a
domestic corporation also engaged in the manufacture of tobacco products like
cigars.[4]
Ripoll is the managing director of Tabaqueria.
On
Tabaqueria, being engaged in the same
business as Tabacalera, cannot be allowed to continue using “tabaqueria” which
will confuse and deceive the public into believing that Tabaqueria is operated
and managed by, and part of, Tabacalera and that its business is approved,
sponsored by, and affiliated with, Tabacalera.
Thereafter,
petitioners also filed with the Department of Justice (DOJ)-Task Force on Anti-Intellectual
Property Piracy a criminal complaint against Ripoll for Infringement of
Trademark and Unfair Competition for violation of Articles 188 and 189 of the
Revised Penal Code. The case was docketed as I.S. No. 94C-07941, entitled Compania General de Tabacos de Filipinas
& La Flor de la Isabela, Inc. (Attys. Ferdinand S. Fider and Ma. Dolores T.
Syquia v. Gabriel Ripoll, Jr. (Tabaqueria de Filipinas, Inc.).
On
February 8, 1994, petitioners filed with the DTI a Complaint dated February 4,
1994[6]
for Unfair Competition, docketed as Administrative Case No. 94-19 and entitled Compania General de Tabacos de Filipinas and
La Flor de la Isabela, Inc. v. Tabaqueria de Filipinas, Inc. and Gabriel
Ripoll, Jr.
Petitioners
alleged in the Complaint that Tabaqueria deliberately sought to adopt/simulate
the Tabacalera trademarks to confuse the public into believing that the
Tabaqueria cigars are the same or are somehow connected with the Tabacalera
products.[7]
In
the Complaint petitioners sought, among others, the issuance of a “preliminary
order requiring respondents to refrain from manufacturing, distributing and/or
selling the Tabaqueria products.”[8]
In
their Answer dated
The party applying for preliminary injunction
must show (a) The invasion of the right sought to be protected is material and
substantial; (b) The right of complainant is clear and unmistakable; and (c)
There is an urgent and paramount necessity for the writ to prevent serious damage.
(Director of Forest Administration vs. Fernandez, 192 SCRA 121 [1990]; Phil.
Virginia Tobacco Administration vs. De los Angeles, 164 SCRA 543 [1988])[9]
Meanwhile, on
Accordingly, it is hereby recommended that
the complaint for unfair competition and/or infringement of trademark be
dismissed against respondent Gabriel Ripoll Jr. for insufficiency of evidence.
Petitioners moved reconsideration of
the above resolution, but their motion was denied in a Letter dated
On March 24, 1995, petitioners filed
a Motion to Issue Cease and Desist Order[13] with
the DTI, praying for the issuance of an order: (1) directing private respondents
to immediately cease and desist from manufacturing, distributing, and selling
cigar products bearing the marks and design of petitioners; (2) for the
immediate seizure of all cigar products of private respondents bearing the
marks and design of petitioners; and (3) for the immediate closure of private respondents’
establishment involved in the production of those products.
In response, private respondents
filed an Opposition to Complainants’ Motion to Issue Cease and Desist Order,
with Motion to Dismiss Complaint dated
Subsequently,
the DTI issued a Temporary Restraining Order dated
In
an Order dated
DETERMINATION OF SIMILARITY IN GENERAL APPEARANCE AND LIKELIHOOD OF CONFUSION; PRODUCT COMPARISON; USUAL PURCHASER
x x x [L]et us now determine if there is similarity in general appearance between Tabacalera products and Respondents’ products, such that it will likely mislead, confuse or deceive the usual purchasers of cigars into buying Respondents’ products thinking that what they are buying are the Tabacalera products they intended to buy.
The competing products should be
viewed in their totality. But certain
features, have to be excluded first.
That is what the Supreme Court did in determining similarity between SAN
MIGUEL PALE PILSEN (of San Miguel Corporation) and BEER PALE PILSEN (of Asia
Brewery, Inc.) in the case of Asia Brewery, Inc. vs.
COMMON FEATURES REASONS FOR EXCLUSION
1. The container is steinie bottle. It is a standard type of bottle and
therefore lacks exclusivity. It is of
functional or common use. It is
universally used.
2. The color of the bottle is amber. It is a functional feature. Its
function is to prevent the transmis-
sion of light into the said bottle
and thus protect the beer inside the
bottle.
3. The phrase “pale pilsen” is This phrase is a generic one even if
carried in their respective included in their trademarks.
trademark.
4. The bottle has a capacity of It is a metrication and standardiza-
320 ML and is printed on the tion requirement of the defunct
label. Metric System Board (now a func-
tion of the Bureau of Product
Standards, DTI).
5. The color of the words and It is the most economical to use on
design on the label is white. the label and easiest to bake in the
furnace. Hence, a functional
feature.
6. Rectangular shape of the label. It is the usual configuration of
labels.
7. The bottle’s shape is round It is commonly and universally
with a neck. used.
In the same case of Supreme Court stated the following, citing Callman, Unfair Competition, Trademarks and Monopolies:
“Protection against imitation should be properly confined to non-functional features. Even if purely functional elements are slavishly copied, the resemblance will not support an action for unfair competition, and the first user cannot claim secondary meaning protection. Nor can the first user predicate his claim in reliance of any such unpatented functional feature, even at large expenditure of money.”
Following the Supreme Court’s way of determining similarity, OLA will exclude the features which arise from industry practices of cigar manufacturers worldwide, features commonly used by cigar manufacturers, standard features, functional features, features arising from labeling rights and obligations, and generic words and phrases. All of these features have been listed and/or discussed above. Now this needs clarification. When we say that we are excluding the logo because it is a functional and universal feature, what we mean to say is that, the fact that both products bear a logo (and therefore they are similar in that respect), will be excluded; but the design, words, drawings of the respective logo of the contending parties will be considered. This clarification is also true for the other excluded features.
Before we view the products in their totality, we will first compare the products as to their respective details. The competing products of the Parties consist of around thirty-two (32) wooden boxes. We note the following glaring differences/distinctions:
1. As to the logo engraved on the top
and/or back of the cover of the box:
TABACALERA’S:
Tabacalera uses two variants of their logo, one for the ordinary plywood boxes and another for the narra boxes. The logo on the ordinary plywood box is as follows:
There are word/phrases thereon, namely:
1st line – the brand “TABACALERA” (in big letters);
2nd line – the representation “THE FINEST CIGARS SINCE 1881”;
3rd line – the representation “HAND MADE 100% TOBACCO”;
4th line – the
address “
5th line – the code “A-4-2”.
Between the 2nd line and 3rd line is inscribed the crest and coat of arms of Tabacalera which consists of a shield placed vertically, and divided into 4 parts with inscriptions/drawings in each part. Within the center of the shield is an oval vertically placed with drawings in it. The crest consists of the uppermost part of a watchtower used in ancient times in watching for enemies coming.
As regards the logo
on the narra boxes, it is oblong or egg-shaped, in two parallel lines
interrupted at its sides with semi-oblong two parallel lines and inscripted
within such latter parallel lines on the left side is “100% TABACO” and on the
right side “HECHO A MANO”. On the lower
portion between the oblong lines are the words “COMPANIA GENERAL DE TABACOS DE
FILIPINAS –
RESPONDENTS’:
A bar curved into a U-shape. It is flanked at the bottom and on its sides with tobacco leaves curved into a “U” also and joined together as in a “laurel”. Engraved at the center of said bar is the coat consists of a “shield”, on top of which is the crest consists of a prince’s crown with a cross on top. The “shield” is divided at its center by a line drawn horizontally with small circles marked at intervals. At the upper portion of said dividing line is a rooster (adopted by Mr. Ripoll from the coat of arms of his clan – Exh. “48”) and the lower portion contains three tobacco leaves (representing Mr. Ripoll’s 3 sons) joined into one. Encircling the crest and coat is the corporate name “TABAQUERIA DE FILIPINAS, INC.” as well as the brand “FLOR DE MANILA”. Immediately below the leaves shaped as in a “laurel” is the phrase “HECHO A MANO 100% TOBACO”.
2. As to the brand of the product:
TABACALERA’S:
The brand “TABACALERA” is printed in big white Roman letters with black shadows on a red rectangular background, and the latter is set over a gold and red rectangular background with a design which appears to be an inverted letter “Z” leaning to the right side, and said “Z” is used repeatedly forming a “chain” that surrounds the said red background. Said “Z” also fills the left and right sides of the label. The same brand and markings appear on three sides of the box. The back side bears the Government Warning that cigar smoking is dangerous to health.
The brand “FLOR DE MANILA” is not used on Tabacalera’s products except on a cardboard pack of cigars, which is just slightly bigger than a pack of 100 mm cigarettes. (Exh. “DD”).
RESPONDENTS’:
The brand “FLOR DE MANILA” is printed in red letters with black shadows on a white rectangular background, and the latter is set over a gold rectangular background filled with a red design that looks like the letter “P” with its head touching the ground. These brand and markings appear on two sides of the box. The other two sides are occupied by the seal of guaranty and by the said Government Warning.
Both Complainants and Respondents have no trademark registration yet of the brand “Flor de Manila”.
3. As to markings on edges of ordinary plywood box:
TABACALERA’S:
The phrase “FLOR FINA” is printed in red Roman letters over a white rectangular background, and the latter is set over a red background with 2 parallel gold lines and the above-mentioned “Z” design in gold used repeatedly forming a straight chain. A tiny company logo colored blue and yellow is marked at intervals.
RESPONDENTS’:
The phrase “TABACO FINO” is printed in red letters with strokes that resemble those in Chinese letters, on a white rectangular background, and the latter is set over a gold background with red designs that look like ornate letters “X” and “J”. A tiny company logo is marked at intervals.
4. As to “seal of guaranty”:
TABACALERA’S:
Colored green and
white; with the phrase “
RESPONDENTS’:
Colored gold and red; with the phrase in big letters “sello de garantia”; bears in big print the company logo; pasted vertically at the middle of the left portion of the cigar box if viewed from its top.
5. As to predominant colors:
TABACALERA’S:
Red, gold, and green, in that order. Has blue and yellow.
RESPONDENTS’:
Gold and red, in that order. No green, blue and yellow.
6. Other differences/distinctions
Tabacalera products have the following features:
a. The corporate name “LA FLOR DE LA ISABELA” (engraved on the narra wood boxes; also printed on the seal of guaranty).
b. The brand “TABACALERA” surrounded by said “Z” design.
c. The representation “THE FINEST CIGARS SINCE 1881”.
d.
The address “
e. The code “A-4-2”.
f.
The phrase “
g. The phrase “FLOR FINA” with the said “Z” design.
These seven (7) features are NOT found in Respondents’ products.
One of the rules in adjudicating unfair competition cases was laid down by the Supreme Court in the case of Del Monte Corp. vs. C.A. et al. (181 SCRA 410) as follows:
We note that respondent court failed to take into consideration several factors which should have affected its conclusion, to wit: age, training and education of the usual purchaser, the nature and cost of the article, whether the article is bought for immediate consumption and also the condition under which it is usually purchased. Among those, what essentially determines the attitude of the purchaser, specifically his inclination to be cautious, is the cost of the goods. To be sure, a person who buys a box of candies will not exercise as much care as one who buys an expensive watch. As a general rule, an ordinary buyer does not exercise as much prudence in buying an article for which he pays a few centavos as he does in purchasing a more valuable thing. Expensive and valuable items are normally bought after deliberate, comparative and analytical investigation. But mass products, low priced articles as in wide use, and the matters of everyday purchase requiring frequent replacement are bought by the causal consumer without great care.
Certainly, not everybody buys cigars. Very few people buy cigars for they are expensive, have health implications, and its smoke annoys non-smokers. It is really not the “sari-sari” store variety. OLA takes judicial notice that even big department stores and malls do not ordinarily sell cigars. The usual purchasers of cigars are older people not necessarily an elder or professional, besides those cigar aficionados and cigar lovers, who are able and willing to pay and are capable of discerning the products they buy. Definitely the “impulse buyers” (those who make a very quick decision (e.g., 6 seconds) to buy a certain product) are not the usual purchasers of cigars.
“The
ordinary purchasers must be thought of as having, and credited with, at least a
modicum of intelligence to be able to see the obvious differences between the
two trademarks in question.” (Fruit of
the Loom, Inc. vs.
Viewing briefly the competing products in
their totality, the two are readily distinguished by their respective brand
as appearing in the box: “TABACALERA” is
the brand of the Tabacalera products while “
Confusion becomes more remote when we consider the usual buyers of cigars. We have already discussed that above. They know their brand and they will not be confused by the various words, marks, and designs on the products. This is specially true for purchasers who have been using Tabacalera products for a long time (Tabacalera products have been available since 1881 [per logo of Tabacalera] or 1917 [per Complaint]), and therefore know very well their favorite brand.
If they switch to Respondents’ products, it is not because they are deceived and confused but because they find Respondents’ products to their taste.
We should also consider that cigars are expensive. Hereunder are sample prices of Respondents’ products (Exhs. “EEE” and “III”):
a. Chest Coronas Largas 25 - P/ 619.75
b.
c.
d.
Tabacalera products are priced higher. The point we are driving at is that with these high prices (which are like prices of writs watches, electric fans, tape recorders, and other electrical/electronic appliances), the usual purchasers will be cautious in buying and he will give the product he is buying that examination that corresponds to the amount of money that he will part with.
Therefore, there is definitely no similarity in the general appearance of the competing products and hence there is no likelihood that purchasers will be [misled], deceived and confused into buying Respondents’ products thinking that they are buying the Tabacalera products that they intended to buy.
Complainants allege in their Complaint that they have been using the trademark (brand) “FLOR DE MANILA” for their products since 1992. However, Complainants presented only a pack of cigars made by La Flor de la Isabela, Inc., with the brand “Flor de Manila”, colored white and gray, and the size is just slightly bigger than a pack of 100 mm. cigarettes. (Exh. “DD”). Buyers cannot possibly make the mistake of buying Respondents’ wooden boxes of cigars thinking that what they are buying is this carton pack of cigars of La Flor de la Isabela, Inc.
x x x x
In
view of all the foregoing, the injunction prayed for cannot be granted in toto
but only partially, i.e., with respect to the barrel type of container, the
existence of which has to be explained and justified further by Respondents,
and certain features in the packaging which are confusingly similar to the
containers/packaging of Complainants’ products x x x.[16] (Emphasis supplied.)
The
DTI disposed of the complaint this way:
WHEREFORE:
1. Respondents
are hereby enjoined and restrained from further manufacturing and using the
wooden barrel type of container as container for their cigars (typified by Exh.
“DDD-1”). However, current stocks thereof, which are in their finished –
product state, now in possession of Respondents’ distributors or retailers may
be sold/disposed of in the ordinary course of business, but those still in the
possession of Respondents shall be transferred to the box containers.
2. In
connection with the label used on the sides of the boxes (which contain the
dominant colors gold and red), Respondents are ordered to:
a.
change either the gold or the red with another color (not blue); or
b.
maintain the said gold and red color combination but add another dominant color
(not blue). This injunction no. 2 covers only products yet to be manufactured
and not products which are already in the possession of Respondents’
distributors/retailers. This injunction is for the purpose only of making said
label of Respondents very distinct.
3. In
connection with the narra wood boxes, Respondents are ordered to make
distinctive and conspicuous etchings/engravings on the top and/or sides of the
said bozes. The etchings/engravings thereon (which are stripe/s) shall be
transferred to other exterior parts of the boxes or done away with. This
injunction no. 3 covers only products yet to be manufactured and not products
which are already in their finished-product state and already in the possession
of Respondents’ distributors/retailers. This injunction is for the purpose only
of making said narra wood boxes of Respondents very distinct, hence, the
present boxes can no longer be used by Respondents unless the above-stated
changes thereon, as herein ordered, are complied with.
x
x x x
SO
ORDERED.[17]
On
June 10, 1996, petitioners filed a Motion for Reconsideration dated June 4,
1996[18]
of the above Order contending that: (1) the DTI erroneously passed upon the
entire merits of the case where the only pending issue for resolution is the
issuance of a preliminary injunction; (2) the findings of facts of the Order
are not in accordance with the evidence presented by the parties; and (3) the
DTI misapplied the law and jurisprudence applicable on the issues in the instant
case. The Motion was denied by the DTI in an Order dated
Thus,
on December 26, 1996, petitioners filed a Petition for Certiorari (With Urgent
Application for Temporary Restraining Order and/or Writ of Preliminary
Injunction) dated December 19, 1996[20]
with the CA. Petitioners raised substantially the same issues as in their
Motion for Reconsideration dated June 4, 1996. The case was docketed as CA-G.R.
SP No. 42881 entitled Compania General de
Tabacos de Filipinas and La Flor de la Isabela, Inc. v. Hon. Virgilio A.
Sevandal, as Director and DTI Adjudication Officer, Atty. Ruben S.
Extramadura,as Hearing Officer – Office of the Legal Affairs, Department of
Trade and Industry, Tabaqueria De
Filipinas, Inc. and Gabriel Ripoll, Jr.
The
CA, thus, issued the assailed decision dated
1)
Whether
or not the Order dated
2)
Whether
or not public respondent committed grave abuse of discretion in refusing to
grant petitioners’ prayer for injunctive relief.[21]
The CA ruled that the findings of the
DTI were premature having passed upon the main issues of the case when the
pending incident was only a motion for preliminary injunction. The CA added that
the evidence necessary in such a hearing was a mere sampling, not being
conclusive of the principal action itself. Thus, the CA ruled that the DTI had
prejudged the case and that its findings were premature, to wit:
By
holding thus, public respondent OLA-DTI had pre-judged the main case. In fact, there was practically nothing left
for the Hearing Officer to try except for private respondents’ claim for
attorney’s fees.
x x x x
We therefore rule that public respondent
OLA-DTI’s finding was premature.[22]
(Emphasis supplied)
As to the second issue, the CA ruled
that the dismissal of the infringement of trademarks and unfair competition
case against respondent Ripoll, Jr., renders petitioners’ right to an
injunctive relief doubtful. Thus, the issuance of an injunction in that case
would not be proper. The CA further ruled that petitioners failed to show that
there was an urgent and paramount necessity for the issuance of the writ having
failed to substantiate their claim that the abrupt drop in the sales of their
products was the direct result of the acts of respondents.[23]
Thus,
the CA denied the petition.[24]
The
petitioners then filed a Motion for Reconsideration dated
Hence, we have this petition.
The Court’s Ruling
This petition must be denied.
The Issues
I.
The Court of Appeals gravely erred in not
declaring the Orders of Public Respondent dated
II.
The Court of Appeals gravely erred in not
ruling that the invasion of/to petitioners’ rights are substantial and
material.
III.
The Court of Appeals gravely erred in ruling
that the petitioners’ right to the exclusive use of the Tabacalera Trademarks
and Design was not shown to be clear and unmistakable.
IV.
The Court of Appeals gravely erred in ruling
that there is no urgent and paramount necessity for the issuance of a writ of
injunction.[26]
The Orders of the DTI were not rendered
in grave abuse
of discretion amounting to lack of or in
excess of jurisdiction
Petitioners argue that because the CA
ruled that the DTI had prejudged the main case, the Decision of the DTI was,
therefore, issued in grave abuse of discretion amounting to lack of or in
excess of jurisdiction. Thus, petitioners conclude that the DTI Orders dated
There is no merit in such contention.
In First Women’s Credit Corporation v. Perez,[28] we
defined grave abuse of discretion as:
By
grave abuse of discretion is meant such capricious and whimsical exercise of
judgment which is equivalent to an excess or lack of jurisdiction. The abuse of
discretion must be so patent and gross as to amount to an evasion of a positive
duty or a virtual refusal to perform a duty enjoined by law or to act at all in
contemplation of law, as where the power is exercised in an arbitrary and
despotic manner by reason of passion or hostility.
We further clarified such principle later
in Buan v. Matugas:[29]
There
is grave abuse of discretion only when there is a capricious and whimsical
exercise of judgment as is equivalent to lack of jurisdiction, such as where
the power is exercised in an arbitrary and despotic manner by reason of passion
and personal hostility, and it must be so patent or gross as to constitute an
evasion of a positive duty or a virtual refusal to perform the duty or to act
at all in contemplation of law. Not
every error in the proceedings, or every erroneous conclusion of law or fact,
is grave abuse of discretion. (Emphasis supplied)
Petitioners must prove that the
elements above-mentioned were present in the rendering of the questioned Orders
of the DTI in order to establish grave abuse of discretion. The mere fact that
the CA ruled that the DTI prejudged the main case filed before it does not by
itself establish grave abuse of discretion.
Moreover, there is no grave abuse of
discretion in the instant case because the DTI merely tried to justify the
issuance of the writ of preliminary injunction. Sometimes a discussion in
passing of the issues to be resolved on the merits is necessary in order to deny
or grant an application for the writ. This cannot, however, be considered as a whimsical
or capricious exercise of discretion.
The
next three issues shall be discussed simultaneously for being interrelated.
Petitioners failed to establish that
they are entitled to a writ of
preliminary injunction
Section 3 of Rule 58 provides for the
grounds for the issuance of a preliminary injunction:
Sec. 3. Grounds for issuance of preliminary injunction. - A preliminary injunction may be granted when it is established:
(a) That the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the commission or continuance of the act or acts complained of, or in requiring the performance of an act or acts, either for a limited period or perpetually;
(b) That the commission, continuance or non-performance of the act or acts complained of during the litigation would probably work injustice to the applicant; or
(c) That a party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or suffering to be done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or proceeding, and tending to render the judgment ineffectual.
Thus, the Court has repeatedly held
that, in order that an injunctive relief may be issued, the applicant must show
that: “(1) the right of the complainant is clear and unmistakable; (2) the invasion of the right sought to
be protected is material and substantial; and (3) there is an urgent and
paramount necessity for the writ to prevent serious damage.”[30]
In
establishing the above elements, it bears pointing out that the Court used the term
“and” in enumerating the said elements. In Mapa
v. Arroyo,[31]
this Court defined the term “and” as follows:
In the present case,
the employment of the word “and” between “facilities, improvements,
infrastructures” and “other forms of development,” far from supporting
petitioner’s theory, enervates it instead since it is basic in legal
hermeneutics that “and” is not meant to separate words but is a conjunction
used to denote a joinder or union.
While in Republic v. David,[32] we
applied the above definition with regard an enumeration of conditions or
requisites in this wise:
The conditions that were allegedly violated
by respondent are contained in paragraph 10 of the Deed of Conditional Sale, as
follows:
“10. The Contract shall further [provide] the
following terms and conditions:
x x x x
(c) The VENDEE, and his heirs and/or successors,
shall actually occupy and be in possession of the PROPERTY at all times”
x x x x
The use of the conjunctive and in
subparagraph (c) is not by any chance a surplusage. Neither is it meant to be
without any legal signification. Its use is confirmatory of the restrictive
intent that the houses provided by petitioner should be for the exclusive use
and benefit of the SSS employee-beneficiary.
It
is easily discernible, therefore, that both “actual occupancy” and “possession
at all times” -- not just one or the other -- were imposed as conditions upon
respondent. The word and --
whether it is used to connect words, phrases or full sentences -- must be
accepted in its common and usual meaning as “binding together and as relating
to one another.” And implies a conjunction, joinder or union. (Emphasis
supplied)
In the instant case, the import of
the use of the term “and” means that all of the elements mentioned above must
concur in order that an injunctive writ may be issued. The absence of even one
of the elements would be fatal in petitioners’ application for the writ.
In finding that the third element was
absent, that there is no urgent and paramount necessity for the writ to prevent
serious damage to petitioners, the CA ruled that:
Second, petitioners have failed to show that
there is an urgent and paramount necessity for the issuance of writ of
injunction to prevent serious damage. In Olalia vs. Hizon (196 SCRA 665, 672),
the Supreme Court held:
“While, to reiterate, the evidence to be
submitted at the hearing on the motion for preliminary injunction need not be
conclusive and complete, we find that the private respondent has not shown, at
least tentatively, that she has been irrepairably injured during the five month
period the petitioner was operating under the trade name of Pampanga’s Pride.
On this ground alone, we find that the preliminary injunction should not have
been issued by the trial court. It bears repeating that as a preliminary
injunction is intended to prevent irreparable injury to the plaintiff, that
possibility should be clearly established, if only provisionally, to justify
the restraint of the act complained against. No such injury has been shown by
the private respondent. Consequently, we must conclude that the issuance of the
preliminary injunction in this case, being utterly without basis, was tainted
with grave abuse of discretion that we can correct on certiorari.”
In
the case at bench, petitioner failed to substantiate their claim that the
abrupt drop in sales was the result of the acts complained of against private
respondent.[33] (Emphasis supplied.)
Petitioners claim that as a result of
private respondents’ “fraudulent and malicious entry into the market,
Petitioners’ sales dropped by twenty-five [percent] (25%).”[34]
Petitioners further aver that the
writ of preliminary injunction is necessary as the general appearance of private
respondents’ products is confusingly similar to that of petitioners’ products.
Petitioners claim that this has resulted in a marked drop in their sales. Thus,
petitioners argue that unless private respondents use similar marks, packaging,
and labeling as that of petitioners’ products, they will continue to suffer
damages.[35]
Petitioners’ postulations are bereft
of merit.
Petitioners failed to present one
iota of evidence in support of their allegations. They failed to present
evidence that indeed their sales dropped by an alleged 25% and that such losses
resulted from the alleged infringement by private respondents. Without
presenting evidence to prove their allegations, petitioners’ arguments cannot
be given any merit. Thus, we ruled in Olalia
v. Hizon:[36]
A preliminary injunction is an order granted
at any stage of an action prior to final judgment, requiring a person to
refrain from a particular act. As the term itself suggest, it is merely
temporary, subject to the final disposition of the principal action. The
justification for the preliminary injunction is urgency. It is based on
evidence tending to show that the action complained of must be stayed lest the
movant suffer irreparable injury or the final judgment granting him relief
sought become ineffectual. Necessarily, that evidence need only be a
“sampling,” as it were, and intended merely to give the court an idea of the
justification for the preliminary injunction pending the decision of the case
on the merits. The evidence submitted at the hearing on the motion for the
preliminary injunction is not conclusive of the principal action, which has yet
to be decided.
Due to the absence of the third requisite
for the issuance of a preliminary injunction, petitioners’ application for the
injunctive writ must already fail; the absence or presence of the other
requisites need no longer be discussed.
Such denial is grounded on the oft-repeated
principle enunciated in Vera v. Arca,[37]
where this Court held that:
As far back as March 23, 1909, more than 60 years ago, this Court, in the leading case of Devesa v. Arbes, made the categorical pronouncement that the issuance of an injunction is addressed to the sound discretion of the Court, the exercise of which is controlled not so much by the then applicable sections of the Code of Civil Procedure, now the Rules of Court, but by the accepted doctrines, one of which is that it should not be granted while the rights between the parties are undetermined except in extraordinary cases where material and irreparable injury will be done. For it is an action in equity appropriate only when there can be no compensation in damages for the injury thus sustained and where no adequate remedy in law exists. Such a holding reflected the prevailing American doctrine that there is no power “the exercise of which is more delicate, which requires greater caution, deliberation and sound discretion or more dangerous in a doubtful case,” being “the strong arm of equity, that never ought to be extended,” except where the injury is great and irreparable.
While in Olalia,[38] we
reiterated the above ruling, as follows:
It has been consistently held that there is
no power the exercise of which is more delicate, which requires greater
caution, deliberation and sound discretion, or more dangerous in a doubtful
case, than the issuance of an injunction. It is the strong arm of equity that
should never be extended unless to cases of great injury, where courts of law
cannot afford an adequate or commensurate remedy in damages.
Every court should remember that an
injunction is a limitation upon the freedom of action of the defendant and
should not be granted lightly or precipitately. It should be granted only when
the court is fully satisfied that the law permits it and the emergency demands
it.
We again ruled in Hernandez v. National Power Corporation:[39]
At times referred to as the “Strong Arm of
Equity,” we have consistently ruled that there is no power the exercise of
which is more delicate and which calls for greater circumspection than the
issuance of an injunction. It should only be extended in cases of great injury
where courts of law cannot afford an adequate or commensurate remedy in damages;
“in cases of extreme urgency; where the right is very clear; where
considerations of relative inconvenience bear strongly in complainant’s favor;
where there is a willful and unlawful invasion of plaintiff’s right against his
protest and remonstrance, the injury being a continuing one, and where the
effect of the mandatory injunction is rather to reestablish and maintain a
preexisting continuing relation between the parties, recently and arbitrarily
interrupted by the defendant, than to establish a new relation.” (Emphasis
supplied)
Clearly, it was incumbent upon the
petitioners to support with evidence their claim for the issuance of a
preliminary injunction. They failed to do so. Hence, the instant petition must
fail.
WHEREFORE, the
petition is hereby DENIED. The
assailed
SO ORDERED.
PRESBITERO
J. VELASCO, JR.
Associate Justice
WE
CONCUR:
Associate Justice
Chairperson
Associate Justice Associate Justice
DIOSDADO M. PERALTA
Associate Justice
I
attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
Pursuant to Section 13,
Article VIII of the Constitution, and the Division Chairperson’s Attestation, I
certify that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the Court’s
Division.
REYNATO S. PUNO
Chief Justice
[1] Rollo, pp. 38-45. Penned by Associate Justice B.A. Adefuin-De la Cruz and concurred in by Associate Justices Jose L. Sabio, Jr. and Hakim S. Abdulwahid.
[2]
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
[11]
[12]
[13]
[14]
[15]
[16]
[17]
[18]
[19]
[20]
[21]
[22]
[23]
[24]
[25]
[26]
[27]
[28]
G.R. No. 169026,
[29]
G.R. No. 161179,
[30] Boncodin v. National Power Corporation
Employees Consolidated
[31]
G.R. No. 78585,
[32]
G.R. No. 155634,
[33] Rollo, p. 44.
[34]
[35]
[36]
G.R. No. 87913,
[37] No.
L-25721,
[38] Supra note 36, at 672-673.
[39] G.R. No. 145328,