On November 5, 2015, the Securities and Exchange Commission (SEC) En Banc reversed the ruling of the SEC Office of the General Counsel (OGC) in a dispute involving a registered mark and various infringing corporate names.

Yahoo! Inc. Seeks to Cancel Six Corporate Names on the Ground of Confusing Similarity

Yahoo! Inc., a US corporation and owner of the marks YAHOO! and YAHOOLIGANS duly registered with the Intellectual Property Office of the Philippines (IPOPHIL), sought to cancel the corporate names of six Philippine corporations, namely Yahoo Food Industries, Inc., Yahoo Computer Center Co., Yahoo Trading Co., Yahoo Transport Inc., Yaho Corporation and Yaho Sales International Corporation (collectively, the respondents). The petition was based on Section 18 of the Corporation Code which states that a corporate name is not allowed if it is identical or deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law or is patently deceptive, confusing or contrary to existing laws.

In its petition, Yahoo! argued that the respondents should not have been allowed registration of its corporate name bearing the mark Yahoo and its variations because it was confusingly similar with its internationally wellknown Yahoo! mark. Yahoo! stressed the fact that it had priority over the registration and use of the mark Yahoo!, and that the respondent’s registration of the word Yahoo and its variations violated Yahoo!’s trademark rights.

The OGC denied Yahoo!’s petition, ruling that it had no priority of adoption over the name Yahoo. It ruled that YAHOO! and YAHOOLIGANS were registered with the Intellectual Property Office of the Philippines after the incorporation of respondents. Hence, priority of adoption could be claimed. The OGC also dismissed the appellant’s claim that the YAHOO! mark was internationally well-known because it had not been determined by a competent authority and that there was no similarity that would cause confusion in the goods and services.

First-to-File Rule v. Date of Incorporation

Aggrieved by the OGC’s decision, Yahoo! filed an appeal with the SEC En Banc.

In this round, the SEC En Banc ruled in favour of Yahoo!, ruling that it had priority of registration over the names YAHOO! and YAHOOLIGANS. In its decision, the SEC En Banc applied the first-to-file rule. It held that the appellant filed the applications to register its marks YAHOO! and YAHOOLIGANS in 1996 prior to the dates of incorporation of respondents. Hence, applying the first-to-file rule as provided in Sec. 123.1 (d) of the IP Code of the Philippines, the appellant therefore had acquired priority of the adoption of the said marks.

More importantly, even if the dates of incorporation of the respondents were earlier than the registration date of the appellant marks YAHOO! and YAHOOLIGANS, the same are not essential in the present case because the appellant had presented evidence of prior and continuous use in trade name and commerce which was essential to prove ownership over a trade name or trademark, which the respondents had failed to deny.

Yahoo! is a Well-Known Mark, Internationally and Locally

In a Supplement to the Memorandum of Appeal, the appellant submitted a Department of Trade and Industry (DTI) Decision dated October 1, 2007, declaring the YAHOO! mark as famous, internationally and in the Philippines. Hence, in its decision, the SEC En Banc did not disturb the DTI’s declaration that YAHOO! was an internationally well-known mark which is afforded protection in accordance with Article 6bis of the Paris Convention and is now incorporated in Sec. 123.1 (e ) and (f) of the IP Code of the Philippines. Similar with any registered mark, the YAHOO! mark enjoys the protection of law against any infringement. The IP Code expressly provides that such protection extends even to those goods and services not similar to that of the owner of the well-known mark. 

Construction of the Provisions of Corporation Code and IP Code

With this decision, the SEC En Banc has stressed the importance of the rule that a corporate name cannot registered if it is identical or confusingly similar with a registered mark. It therefore applied not only the provisions of the Corporation Code but also the pertinent provisions of the IP Code in revoking confusingly similar corporate names. Finally, this decision stressed that the SEC rules on corporate names do not stand alone. They exist and should be construed in relation to the pertinent provisions of relevant laws, such as the IP Code.

This article was first published in Asia IP on May 19, 2016. For more information, please visit http://www.asiaiplaw.com/.