SEC Adm. Case No. 08-10-208 De La Salle et. al.

Securities ana Exchange Commission Departriant of Trade and Industry Republic of the Philippines

SEC Bidg. EDSA, Greenhills, Mandaluyong City

DE LA SALLE BROTHERS, INC., DE LA SALLE UNIVERSITY, INC. LA SALLE ACADEMY, INC., DE LA SALLE - SANTIAGO ZOBEL SCHOOL, INC.(formerly named SALLE-CANLUBANG, INC. (former De La Salle-South Inc.) and DE LA Iy named De La Salle University- Canlubang, Inc.), Petitioners-Appellees,

SCHOOL OF SAINT LA SALLE -versus- For: Change of Name SEC En Banc Case No. 08-10-208

St. Lasalle Learning Center, Inc.). OF QUEZON CITY, INC. (formerly

Respondent-Appellant.

DECISION

For consideration is the Appeal dated 31 July 2010 filed on 2 August 2010 by School of Saint La Saile of Q!ezon City, Inc. ("appellant", for brevity) from the Order of the Commission's Office of the General Counsel ('OGC'? dated 9 July 2010 granting the petition of De La Salle Brothers, Inc., De La Salle University, Inc., Lal Saile Academy, Inc., De La Salle-Santiago Zobe! School, Inc. and De La Salle- Canlubang, Iic. ('appellees') for the change of appeliant's corporate name.

The parties to this case are all educational institutions.

Appeliee De La Salle Brothers, Inc. ("the Brothers'? is the community of educators which founded the De La Salle College in the Philippines in June 1911 and, thereafter, numerous other schools throughout the country. The Brothers consistentiy included the phrase "La Salle " in the names of these various schools to distinguish them from those that were founded by other individuals or sectors.

Appellees' incorporation dates and registration numbers are as follows: (1) De La Salle Brothers; Inc. - 9 October 1961, under SEC Registration No. 19569; (2) De La Salle University, Inc., -- 19 December 1975, under SEC Registration No. 65138; (3) La Salle Academy, Inc. --.26 January 1960, under SEC Registration No. 16293; (4) De La Salle-Santiago Zobel School, Inc. - 7 October 1976, under SEC Registration No. 69997; and (5) De La Salle-Canlubang, Inc. -- 5 August 1998, under SEC Registration No. A1998-01021.

Appellant, on the other hand, was incorporated on 28 August 2003 under SEC Registration No. CN200318902.

De La Salle Brothers, Inc., et al. vs. School of Saint La Salle of Quezon City, Inc. SEC En Banc Case No. 08-10-208 Page 2 of 6

("the Code"1, which reads: the corporate name of appellant, pursuant to Section 18 of the Corporation Code On 1 September 2009, appellees filed before the OGC a petition to change

the Securities and Exchange Commission if the proposed name is identical or to any other name already protected by law or is patently deceptive, confusing or contrary to existing laws. xxx." (Emphasis supplied). deceptively or confusingly simiiar to that of any existing corporation or "Sec. 18. Corporate Name. - No corporate name may be allowed by

On 9 Juiy 2010, the OGC issued its herein assailed Order. Hence, this Appeal.

finding that the phrase "La Salle " is generic; and (?) whether or not the OGC erred in ruling that appellant's name is deceptively or confusingly similar to those of the Appellant raises the following issues: (1) whether or not the OGC erred in not

appellees.

AND HENCE, CANNOT BE EXCLUSIVELY APPROPRIATED ON WHETHER OR NOT "LA SALLE" IS GENERIC,

Appellant maintains that "La Salle " is generic in that: (a) it is the name of a saint, St. Jean-Baptiste de La Salle, the patron saint of teachers; and (b) it also refers to a place or a geographic location.

Contrary to appellant's assertion, the phrase "La Saile " is not gereric with respect to the appellees' names. In trademark law, rules on generic, descriptive and suggestive terms are already settied, to wit:

descriptive name of an article or substance, or comprise the 'genus of "Generic terms are those which constitute 'the common

which the particular product is a species, or are 'commonly used as the name or description of a kind of goods, or 'imply reference to every member of a genus and the exclusion of individuating characters, or 'refer to the basic nature of the wares or services provided rather than to the more idiosyncratic characteristics of a particular product' and are not iegally protectable. On the other hand, a term is descriptive and therefore invalid as a trademark ir, as understood in its normal and natural sense, it `forthwith conveys the characteristics, functions, qualities or ingredients of a product to one who has never seen it and does not know what it is, or `if it forthwith conveys an immediate idea of the ingredients, qualities or: characteristics of th: goods,' or if it clearly

consumer does not have to exercise powers of perception or denotes what goods or services are provided in such a way that the

imagination."

'Batas Pambansa Big.68 (1980). "Societe des Produits Nestle, S.A., et al. vs. Court of Appeals, et al., G.R. No. 112012, 4 April 2001

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thought and perception to reach a conclusion as to the nature of the "Suggestive terms are those which xxx require `imagination.

`imaginative effort on the part of the observer" 3 "They `are words. nevertheless involve `an element of incongruity' `figurativeness' or upon. certain characteristics of the goods or services in dispute, they goods.' xxx. While suggestive marks are capable of shedding `some light pictures, or other symbols that suggest, but do not directly describe. something about the goods or services in connection with which they are used as marks' 4; as they merely give hint as to the quality or nature of the product, suggestive marks can thus be distinctive and are registrable. (Emphasis ours).

French priest and saint Jean-Baptiste de la Salle is of no moment because such a Whether or not the phrase " La Salle " or " De La Salle " means or refers to the

circumstance does not necessarily make the phrase a generic or descriptive term in the technical sense described above. La Salle Cr "De La Salle " is not generic in that it does not particularly refer to the basic or inherent nature of the services provided by the appellees; neither FMe the sense that it does not forthwith and clearly convey PG what appellees' services are. In fact, it merely gives a nir nouaht and perception tc reach a conclusion as which, in one case Was Unlike the word "Lyceum in the English language as synonym of defining purpose of an educational col schod oratior tae termi riptive of the very being and "La Salle " or " De La Salle " does not inherently mean school, , and hence, still requires one's imagination to associate it with the name of the saint.

As to appellant's argument that the phrase also pertains to a place or a geographical iocation, suffice it to state that this defense was not raised in the proceedings a quo, and as such, cannot be considered in this Appeal. At any rate, the contention stili holds no water. As a name of a piace, "La Salle " or "De La Salle' is not descriptive of the business location of both parties, considering that "La Salle " or "De La Salle " is not part of any geographical area in the Philippines where any of the parties may set up their business. Therefore, the rationale why a geographicai name cannot be exclusively appropriated in favor of any party does not apply because here, the choice by appellees of "La Salle " or "De La Salle " was arbitrary and fanciful, not made on account of one's business location. Ironically, appellant's point that "La Salle " is also a geographical location further tends to argue for the phrase's distinctiveness, it appearing that the same does not exciusively refer to name of the saint.

'McCarthy's Desk Encyclopedia of Intellectual Property, 1991 Ed., p. 322. 5Vicente B. Amador, Trademarks Under the Intellectual Property Code 27 (1999 Edition), citing American Wire 3Supra, Note 2.

and Cable Co. vs. Director of Patents and Central Banahaw Industries, G.R. No. L-26557, February 18, 1970. Lyceum of the Philippines, Inc. vs. Court of Appeals, et al., G.R. No. 101897, March 5, 1993. 'Also found in the Spanish langtiage as "iceo" and the French Janguage as "lycce" "Decision dated 4 December 2008 in SEC En Banc Case No. 06-012 entitled Beverly Hills Pluistic Surgery and Skin Center, Inc. vs. Beverly Hills Cosmetic Surge rv and Skin Institute, Inc

YUMAY

De La Salle Brothers, Inc., et al. vs. School of Saint La Salle of Quezon City, Inc. SEC En Banc Case No. 08-10-208 Page 4 of 6

discuss appellant's contention that the phrase has not attained secondary meaning in appellees' favor. The doctrine of secondary meaning cannot be invoked in this case as it presupposes that, and applies only when, the term is originally generic. Having established that "La Salle " is not generic, there is no more need to

ON WHETHER OR NOT APPELLANT'S NAME IS DECEPTIVELY OR CONFUSINGLY SIMILAR TO THOSE OF APPELLEES

appear; (b) its name must be considered in its entirety to see that it contains distinctive words .in compliance with SEC Memorandum Circular No. 14, Series of 2000 ('MC No. 14-00'3', the governing ruie at the time it was incorporated; (c ) the into consideration the difference in the parties' logo, color and uniform; and (d) to be deceived. OGC should not have limited itself to the similarities in name and should have taken parents are very discerning in choosing schools for their children and are not likely Appellant argues that: (a) actual or probable deception and confusion must

test is whether the similarity is such as to mistead a person using ordinary care and discretion. It is already settled, however, that proof of actual confusion need not be shown and it suffices that confusion is probabiy or likely to OCCu In determining the presence of confusing similarity in corporate names, the

words that distinguish it from those of the appellees. The words "Schoo/ " and word is obviously a generic term; and the second is an insufficiently distinct common word which, considering the religious 'leanings of the Brothers, can still be founded by, any or all of the appellees, thereby causing confusion. "Saint " in appellant's name cannot serve as effective differentiating media: the first reasonably associated with the appeilees. Neither can the appendage of "Quezon and discretion into thinking that appellant is an affiliate or a branch of, or is likewise City " serve such purpose as it can reasonably mislead a person using ordinary care Also, we cannot sustain appellant's claim that its name contains distinctive

similar to the name of a regisiered firm, the proposed narne must contain at least applies only if the word already used or registered as part of a corporate name is a one distinctive word different from the name of the company already registered " generic name; it does not apply if the word is a valid trademark or trade name of another person or entity or is a dominant word or feature of a previously used or Besides, the rule in MC No. 14-0011 to the effect that "if the proposed name is

registered corporate name.i As adverted to above, "La Saile " or "De La Salle " is

Lyceum of the Philippines, Inc. vs. CA, 219 SCRA 610, and Philips Export B.V. vs. CA, 206 SCRA 458. 12Ruben E. Agpalo, The Law on Trademark, Infringenent and Unfair Competition I 10 (2000 Edition), citing 3, 2002, citing Philips Export B.V., et al. vs. CA, et al., G.R. No. 96161, February 21, 1992. Revised Guidelines in the Approval of Corporate and Partnership Names. Industrial Refractories Corporation of the Philippines vs. Court of Appeals, et al., G.R. No. 122174, October A!ready amended by SEC Memorandum Circular No. 5, Series of 2008.

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not generic. Moreover, it is the dominant term, a fixture, in appellees' corporate names, the same having been consistently included therein by the Brothers.1

similarity in the parties' names but also in the business or industry they are engaged Ionger necessary in this case. Besides, appellant's logo still prominently uses the in. These considerations alone are already sufficient to support a finding of confusing similarity. Unlike the typical stock corporation which is engaged in profit: making business and has various products in trade designated by their corresponding trademarks by which the corporation may also be known, educational corporations like the parties in this case are primarily known by their respective corporate names. Thus, consideration of the parties' logo, color and uniform are no word "LaSalle " and dominantly utilizes the color green, which is also the color of appellees, thereby not preciuding the likelihood of confusion. Indeed, confusion is probably or likely to occur, considering not oniy such

connotes, wouid more likely cause them to let thair guard down. serving, unsubstantiated and loses sight of certain factors like the demographics of the reason for the confusing similarity, effectively conjuring the inference that main selling point or come-on to the general public which, because of the promise it the prospective clients, for one. On the contrary, the fact remains that "LaSalle " is appellant is affiliated with and/or was founded by the appellees. This inference is the Appellant's assertion that the parents are not likely to be deceived is self.

connected with the appellees.14 As the OGc correct!y concluded, this is telling evidence that appellant itself recognizes and admits that its name is confusingly vigiiant in informing the public, especially the parents of the enroilees, that it is not similar with those of the apellees and that, accordingly, confusion is very likely to occur. Lastiy, it is on record that appellant, through its owners and teachers, are

and the Order dated 9 July 2010 of the Office of the General Counsel is hereby AFFIRMED. WHEREFORE, premises considered, the instant Appea/ is hereby DENIED

SO ORDERED.

Mandaluyong City, 9 September 2010.

13 Philips Export B.V., et ai. vs. CA, et a!., G.R. No. 96161, February 21, 1992 4Rejoinder, par. 5; Answer, par. 3 NTTriiAiYA

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Ra 6.baAJ FE B,BARIN Chairperson

MA JUANItA Z. CUeTO Commissioner AG RAUL J. PALABRICA Commissioner

MANUEL HUBERTO B. GAITE Commissioner FLRDIe Commissioner JALA