NESTLE VICTORIOUS OVER INFANT MILK JURISDICTION REPORT: PHILIPPINES
Anne Mariae Celeste V. Jumadla Sapalo Velez Bundang & Bulilan
On August 9, 2010, the Supreme Court gave its decision in Societe des Produits Nestle v. Martin T. DY Jr, applying the dominance theory it has developed over a long line of cases dealing with similar marks. In this case, there was a confusing similarity between Nestle’s ‘Nan’ trademark and DY’s ‘Nanny’ trademark. Nestle’s mark is the prevalent feature in the names of its infant powdered-milk products: Pre-nan, Nan-H.A., Nan-1 and Nan-2. Te mark is entirely contained within DY’s Nanny mark. Te High Court took notice of that and the confusing similarities between the aural effects of Nan and Nanny.
Te controversy started on August 1, 1985, when Nestle asked DY to stop using its Nanny mark on “full cream milk for adults of all ages” and to undertake to stop infringing Nestle’s Nan trademark, registered with the Bureau of Patents, Trademarks and Technology Transfer (BPTTT) for Class 6 goods, specifically “dietetic preparations for infant feeding”.
As DY failed to comply, Nestle filed a complaint for the infringement of its Nan trademark. Te trial court found DY liable for infringement, holding that DY’s use of its Nanny mark would imply that the goods came from the manufacture of Nan, as both goods are food products belonging to the same class.
Te Court of Appeals reversed the trial court’s decision, holding that while both Nan and Nanny are milk products and the word Nan is contained in the word Nanny, there are dissimilarities between the trademarks as a whole as they appear in their respective labels and also in relation to the goods bearing them.
Te Supreme Court set aside the appeals court decision and affirmed the trial court’s finding that DY was liable for infringing Nestle’s Nan trademark. Te court emphasised that likelihood of confusion is the gravamen of trademark infringement and applied the dominancy test to determine its existence. In this test, the court evaluates the similarity between the main, prevalent or essential features of the competing trademarks that might cause confusion. Infringement exists when the competing trademark contains the essential features of another. Tis is in contrast to the holistic test, which considers the entirety of the marks, including labels and packaging.
Te court held:
“Applying the dominance test in the present case, the Court finds that ‘Nanny’ is confusingly similar to ‘Nan’. ‘Nan’ is the prevalent feature of Nestle’s line of infant powdered milk products. It is written in bold letters and used in all products. Te line consists of Pre-Nan, Nan-H.A., Nan-1, and Nan-2. Clearly, ‘Nanny’ contains the prevalent feature of ‘Nan’. When ‘Nan’ and ‘Nanny’ are pronounced, the aural effect is confusingly similar.”
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“ IN [THE DOMINANCY TEST], THE COURT EVALUATES THE SIMILARITY BETWEEN THE MAIN, PREVALENT OR ESSENTIAL FEATURES OF THE COMPETING TRADEMARKS THAT MIGHT CAUSE CONFUSION.”
Te court relied on its previous decisions in applying the dominance test, particularly in:
• McDonald’s Corporation v. Macjoy Fastfood Corporation, finding the ‘Macjoy’ mark confusingly similar to the ‘McDonald’s’ mark, since both marks use the corporate ‘M’ design logo and the prefixes ‘Mc’ and/or ‘Mac’ as dominant features
• Societe Des Produits Nestle, SA v. Court of Appeals, finding the mark ‘Flavor Master’ confusingly similar with ‘Master Roast’ and ‘Master Blend’ for having the same dominant feature.
Te court also ruled that the scope of protection afforded to trademark owners is not limited to protection from infringers with identical goods.
Nanny and Nan have the same classification, descriptive properties and physical attributes. Tey are both powdered milk products under Class 6 and are both displayed in the milk section of stores. Tere are indeed differences between Nan and Nanny: Nan is for infants, while Nanny is for adults and children past infancy; and Nan is more expensive than Nanny. Nonetheless, the court declared that Nestle must be free to use Nan on similar products, in different segments of the market and at different price levels. Te scope of protection of a registered mark extends to market areas that are the normal expansion of business, in view of the provision in the Trademark Law, that a certificate of registration of a mark is prima facie evidence of the registrant’s exclusive right to use the mark in connection with the goods or services, and those that are related thereto, specified in the certificate.
Anne Mariae Celeste V. Jumadla is an associate at Sapalo Velez Bundang & Bulilan. She can be contacted at:
info@sapalovelez.com
World Intellectual Property Review September/October 2010 91
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