SEC En Banc Case No. 07-18-448 Panciteria Lidp Chinese Cuisine Co. vs. CRMD and Salido Foods & Beverages Corp. (Decision dtd 7 Dec 2023)

Securities and Exchange Commission COMMISSION EN BANC Republic of the Philippines Department of Finance

CUISINE, CO., PANCITERIA LIDO CHINESE Appellant.

- versus - SEC En Banc Case No. 07-18-448 Change of Corporate Name

Promulgated: 07 December 2023

COMPANY REGISTRATION AND BEVERAGES CORP., MONITORING AND SALIDO DEPARTMENT FOODS Appellees. &

X X

DECISION

"Petition"), the dispositive portion of which reads, thus: Commission's Company Registration and Monitoring Department 2018, dismissing Appellant's Petition for Change of Business Name (the (the "Appeal") filed on even date by PANCITERIA LIDO CHINESE CUISINE, CO., (the "Appellant"), seeking the reversal and setting aside of the Order dated 11 December 2017 (the "Assailed Order") issued by the (CRMD), which was affirmed in the latter's Resolution dated 22 May Before the Commission En Banc is the Appeal dated 6 July 2018

"WHEREFORE, premises considered, the Petition is hereby DISMISSED for lack of merit."

RELEVANT FACTS

Lido's principal address is at No. 8 Bayanihan Street, West Triangle, Quezon City. "Appellant") is a partnership that was registered with the Commission on 11 February 2009 under SEC Registration No. PG 200901574. Panciteria Appellant PANCITERIA LIDO CHINESE CUISINE, CO. (the

of Partnership of Appellant to include the following business names: PANCITERIA LIDO; KAPIHAN SA LIDO; NEW LIDO RESTAURANT; LIDO CAFE; LIDO CATERING; and LIDO COCINA TSINA. The appellant is also On 17 July 2014, the Commission approved the Amended Articles

Panciteria Lido Chinese Cuisine, Co. vs. Salido Foods & Beverages Cor SEC En Banc Case No. 07-18-448 Page 2 of 15 DECISION

the owner of the trademark LIDO COCINA TSINA, which was registered with the Intellectual Property Office (IPO) of the Philippines under Trademark Registration No. 4-2012-014828 on 27 September 2013.

doing business under the name and style of SALIDO RESTAURANT, is a been registered with the Commission on 31 August 2010 with SEC Registration No. CS201013978. Appellee's principal office address is at 158 N. Domingo Street, San Juan City. corporation duly organized and existing under Philippine laws, having Appellee SALIDO FOODS & BEVERAGES CORP., (the "Appellee")

issuance of an order directing the Appellee to remove the word "Salido" as part of its corporate name. name. The appellant argued that the requisites prescribed in Philips the earlier registrant, and has presented evidence showing that the use by Appellee of the word "Lido" as part of its corporate name has actually confused the public.2 The appellant then concluded that this warrants the the word "Salido" as part of its corporate name violates Section 18 of the Corporation Code as it is confusingly similar to Appellant's partnership Export B.V. v Court of Appeals (the "Philips Export Case") are both present considering that it has acquired prior right over the word "Lido" being In its Petition, Appellant maintained that the use by the Appellee of

2010 of the Intellectual Property Office3, and that the word "Salido" in its the same is bereft of merit. the words "Panciteria Lido" as part of its name because it is not the owner they are allegedly distinguishable, and the public has allegedly regarded the restaurants operated by the parties as distinct from each other.4 Appellee thus maintained that the dismissal of the Petition is in order as of the mark, invoking for this purpose the Decision dated 19 November corporate name is not confusingly similar to that of Appellant's "Lido" as Appellee countered by arguing that Appellant has no right to use

2009, pursuant to the priority of adoption rule. However, the CRMD corporate name, "SALIDO FOODS & BEVERAGE CORP." is not confusingly similar to Appellant's partnership name, "PANCITERIA LIDO CHINESE nonetheless dismissed the Petition on the basis of the finding Appellee's Philips Export Case, found that the Appellant has acquired a prima facie right over its partnership name which was recorded on 11 February In the Assailed Order, the CRMD, applying the doctrine in the

1 Section 17 of the Revised Corporation Code. 3 Par. 11 of the Answer dated 16 May 2016 2 See Pars. 22, 28, and 29 of the Petition dated 1 April 2016 4 Par. 16 of the Answer dated 16 May 2016

Panciteria Lido Chinese Cuisine,Co.vs. Salido Foods & Beverages Corp SEC En Banc Case No. 07-18-448 Page 3 of 15 DECISION

appropriate the term "Lido" in adopting and using it as part of its was brought about by extraneous circumstances independent of the similarity in the trademarks should be made with the IPO by the filing of a petition for cancellation of registration of a mark or by instituting a civil action for infringement both in accordance with the Intellectual Property corporate name because "Lido" is a coined term which is unique in itself and is thus capable of exclusive use and appropriation. The CRMD likewise held that the purported confusion presented by the Appellant partnership name and corporate name of the parties, and relate to the use of their respective marks. Hence, the reliefs sought to avoid confusing Code. CUISINE CO." The CRMD specifically found and held that Appellee did not

similar to Appellant's registered name, which is also one that is already appropriation, and its use by Appellee as part of its corporate name violates Section 18 of the Corporation Code because it is confusingly reversible error in dismissing its Petition arguing that the evidence shows that the word "Salido" is not a coined word capable of exclusive protected by law. Appellant maintained in its Appeal that the CRMD committed

of Non-Forum Shopping. the Order to File Amended Appeal Memorandum dated 16 July 2018, where it submitted an Amended Appeal Memorandum revising the caption of the case and attaching thereto a Verification and Certification On 13 August 2018, the Appellant filed its Compliance pursuant to

(the "Comment") to the Appellant's Compliance, praying for the dismissal 3-7 of the Rules of Procedure of the Securities and Exchange Commission of the Appeal on the ground that it failed to comply with Sections 3-4 and (the "Rules"). On 24 August 2018, the Appellee filed its Comment/0pposition

ISSUES

(A)Whether Appellant's failure to comply with the provisions of Rule III, Sections 3-4 and 3-7 of the Rules warrants the dismissal of the instant Appeal.

CHINESE CUISINE CO., on the basis of the finding that the term "Lido" is Appellee's corporate name, SALIDO FOODS & BEVERAGES CORP. is not (B)Whether the CRMD committed reversible error in holding that deceptively or confusingly similar to Appellant's PANCITERIA LIDO a coined word which can be exclusively appropriated.

Panciteria Lido Chinese Cuisine, Co. vs. Salido Foods & Beverages Corp SEC En Banc Case No.07-18-448 Page 4 of 15 DECISION

RULING

The Commission finds merit in the Appeal.

I complied with the Rules Shopping. requiring the submission of Verification Certification Against Forum Appellant substantially and

was conducted in the principal office of the partnership as provided in Section 3-7 of the Rules considering that it was Appellant's lawyer who signed the verification and certification against forum shopping.6 the Certificate of Partnership Resolution on the ground that Ms. Annie Alipio resides in Toronto, Canada.5 Appellees thereafter concluded that the Appeal is dismissible for its failure to comply with the requirement of In their Comment, Appellees argued that no partnership meeting

conclusion. The Commission does not share Appellee's position and

Section 3-7, Part V, Rule III of the Rules provide:

verified in the same manner as a verified answer under Section 3-3, Rule III of Part II of these Rules." "The Appeal Memorandum and Comment to the Appeal shall be

assurance from the relevant party that the allegations in the pleading have been prepared in good faith or are true and correct, not mere speculations.7 On the other hand, the Supreme Court explained the purpose for requiring a certification against forum shopping in Fontana Development Corp. v. Vukasinovic3, thus The purpose of requiring a pleading to be verified is exact an

is the rendition by two competent tribunals of two separate and several different fora until a favorable result is reached. To avoid the resultant confusion, this Court adheres strictly to the rules against contradictory decisions. Unscrupulous party litigants, taking advantage of a variety of competent tribunals, may repeatedly try their luck in "The grave evil sought to be avoided by the rule against forum shopping

5 Pars. 3 and 5 of the Comment/Opposition dated 23 August 2018 6 Par. 5 of the Comment/0pposition dated 23 August 2018 7 Novelty Philippines, Inc. v. Court of Appeals, G.R. No. 146125, [September 17, 2003] G.R. No. 222424, [September 21, 2016]

Panciteria Lido Chinese Cuisine, Co. vs. Salido Foods & Beverages Corp SEC En Banc Case No. 07-18-448 Page 5 of 15 DECISION

forum shopping, and any violation of these rules results in the dismissal of a case.

verification and certification requirement that have been elevated to the Supreme Court resulted in the formulation of guidelines which have become settled in jurisprudence. We find these guidelines expounded in Fernandez v. Villegas9, to wit: Over the years, the cases involving non-compliance with the

noncompliance with the requirements on or submission of a defective verification and certification against forum shopping, viz.: The Court laid down the following guidelines with respect to

1 A distinction must be made between non-compliance with the requirement on or submission of defective verification, and noncompliance with the requirement on or submission of defective certification against forum shopping.

2 As to verification, non-compliance therewith or a defect therein compliance with the Rule may be dispensed with in order that the does not necessarily render the pleading fatally defective. The pleading if the attending circumstances are such that strict ends of justice may be served thereby. court may order its submission or correction or act on the

3 Verification is deemed substantially complied with when one who has ample knowledge to swear to the truth of the allegations in the complaint or petition signs the verification, and when matters alleged in the petition have been made in good faith or are true and correct.

4 As to certification against forum shopping, non-compliance therewith or a defect therein, unlike in verification, is generally unless there is a need to relax the Rule on the ground of "substantial compliance" or presence of "special circumstances or compelling reasons." not curable by its subsequent submission or correction thereof

5 The certification against forum shopping must be signed by all the plaintiffs or petitioners in a case; otherwise, those who did not justifiable circumstances, however, as when all the plaintiffs or of action or defense, the signature of only one of them in the certification against forum shopping substantially complies with the Rule. sign will be dropped as parties to the case. Under reasonable or petitioners share a common interest and invoke a common cause

6 by the party-pleader, not by his counsel. If, however, for Finally, the certification against forum shopping must be executed

" G.R. No. 200191, [August 20, 2014]

Panciteria Lido Chinese Cuisine, Co. vs. Salido Foods & Beverages Corp. SEC En Banc Case No. 07-18-448 Page 6 of 15 DECISION

reasonable or justifiable reasons, the party-pleader is unable to sign, he must execute a Special Power of Attorney designating his counsel of record to sign on his behalf.37 (Emphases supplied)

include the requirement on verification and certification against forum interpreted with such absolute literalness as to defeat its own ultimate and legitimate objectives, thus: shopping, are used to effectively dispense justice, hence, should not be the Supreme Court emphasized the policy that rules of procedure, which Moreover, in SM Land, Inc. v. City of Manila1o (the "SM Land Case")

"It must be kept in mind that while the requirement of the certification preventing the undesirable practice of forum shopping. of non-forum shopping is mandatory, nonetheless, the requirements must not be interpreted too literally and, thus, defeat the objective of

Time and again, this Court has held that rules of procedure are established to secure substantial justice. Being instruments for the speedy and efficient administration of justice, they must be used to achieve such end, not to derail it. In particular, when a strict and literal application of the rules on non-forum shopping and verification will result in a patent denial of substantial justice, these may be liberally construed.

but also its failure to timely submit its verification and certification of non-forum shopping. In the instant case, petitioner Watsons' procedural lapse was its belated submission of a Secretary's Certificate authorizing Atty. Cruz as its representative. On the other hand, petitioner SM Land, Inc.'s infraction was not only its late submission of its Secretary's Certificate

In a number of cases, this Court has excused the belated filing of the that special circumstances or compelling reasons make the strict application of the rule clearly unjustified. This Court ruled that substantial justice and the apparent merits of the substantive aspect of the case are deemed special circumstances or compelling reasons to relax the said rule." (Emphasis supplied) required verification and certification of non-forum shopping, citing

is an administrative action filed with the Commission, an administrative body which is not bound by strict and rigid application of the rules.11 Relative thereto, it is well worth pointing out that the instant case

10 G.R. No. 197151, [October 22, 2012]

11 "It is well-settled that "the rules of procedure are mere tools aimed at facilitating the attainment of justice, rather than its frustration. A strict and rigid application of the rules must always be eschewed when it would subvert the primary objective of the rules, that is, to enhance fair trials and expedite justice. Technicalities should never be used to defeat the substantive rights of the other party. Every party-litigant must be afforded the amplest opportunity for the proper and just determination of his cause, free from the constraints of technicalities." "Indeed, the

Panciteria Lido Chinese Cuisine, Co. vs. Salido Foods & Beverages Corp SEC En Banc Case No.07-18-448 Page 7 of 15 DECISION

action and proceeding before the Commission and to carry out the secure a just, prompt, expeditious, and inexpensive determination of every objectives of the laws it is mandated to implement." liberally construed and administered to promote public interest, to Thus, the 2016 Rules specifically provide that "[t]hese Rules shall be

Mark Anthony Ong Wu on the basis of the Certificate of Partnership implementation of Section 18 of the Corporation Code which is the main issue in this case, be passed upon for the promotion of public interest. Resolution. This rendered Appellant compliant with Section 3-7, Part V, Rule III of the Rules. The liberal application of the Rules requires, and this Mark Anthony Ong Wu should be considered as substantial compliance with such Rules if only to ensure that the matter relating to the Commission so holds, that the Verification and Certification executed by subsequently submitted the Verification and Certification executed by In the instant case, the evidence on record shows that Appellants

administer, to wit: the partners meeting which resulted in the execution of Certificate of the objectives, and implement the provisions of the RCC mandates that the Verification and Certification executed by Mark Anthony Ong Wu be considered as substantial compliance. Applying the pronouncement of the Supreme Court in the SM Land Case, this is an exercise by the Commission of its inherent power to suspend its own rules in the interest of substantial justice and to implement the RCC which it is mandated to Partnership Resolution is immaterial in the absence of a showing that the partners, or either them, assailed the same. Again, the liberal application of the Rules to ensure that this Commission is effectively able to carry out The Commission also holds that the issue relating to the conduct of

of the case." (Emphasis supplied) compliance with the rule on certification against forum shopping. the Court may still proceed to decide the case on the merits, grounds, as stated above, of substantial justice and apparent merit "In fact, this Court has held that even if there was complete non- pursuant to its inherent power to suspend its own rules on

primordial policy is a faithful observance of (procedural rules], and their relaxation or suspension should only be for persuasive reasons and only in meritorious cases, to relieve a litigant of an injustice not commensurate with the degree of his thoughtlessness in not complying with the procedure Orthopaedie GMBH and Co. vs Philippine Shoe Expo Marketing Corporation., G.R. No. prescribed." This is especially true with quasi-judicial and administrative bodies, such as the IPO, which are not bound by technical rules of procedure. (Emphasis supplied) [Birkenstock 194307, November 20, 2013]

Panciteria Lido Chinese Cuisine, Co.vs. Salido Foods & Beverages Cor SEC En Banc Case No.07-18-448 Page 8 of 15 DECISION

H. corporate Appellee's use of the word confusingly Appellant's name. Salido as part of similar name its Is to

on the basis of a finding that the Appellee's corporate name is not confusingly similar to the Appellant's partnership name. In the Assailed Order, the CRMD dismissed the Appellant's Petition

same is not supported by the evidence on record. The Commission disagrees with the finding of the CRMD as the

Section 18 of the Corporation Code12 expressly provides:

law or is patently deceptive, confusing or contrary to existing laws. When a change in the corporate name is approved, the Commission shall issue an amended certificate of incorporation under the amended "Section 18. Corporate name. - No corporate name may be allowed by the Securities and Exchange Commission if the proposed name is identical or deceptively or confusingly similar to that of any existing corporation or to any other name already protected by name." (Emphasis supplied)

administration and supervision over corporations.13 Corporation Code on the use of corporate names or a part thereof that are the registered owner is the avoidance of fraud upon the public which would have occasion to deal with the entity concerned, the evasion of legal obligations and duties, and the reduction of difficulties of corporation or to any other name already protected by law or is patently deceptive, confusing or contrary to existing laws" without the consent of "identical or deceptively or confusingly similar to that of any existing The policy underlying the prohibition in Section 18 of the

individual's name is thrust upon him.14 It is in this context that the use of corporate names is regulated, and corporations are required to specifically undertake to modify their names if the same is found to be an individual name in respect to the manner of their acquisition. A corporation acquires its name by choice and is thus accorded a wide latitude and discretion to create or adopt one that is unique (and not one that is already appropriated by a senior corporation), while an There is an important distinction between a corporate name and

13 De La Salle Montessori International of Malolos, Inc. v. De La Salle Brothers, Inc. (G.R. No. 205548. 12 Section 17 of the Revised Corporation Code. February 7,2018) 14 Standard Oil Co. of N.M. vs Standard Oil Co. of Cal., 13 U.S.P.Q. 76

Panciteria Lido Chinese Cuisine, Co.vs. Salido Foods & Beve SEC En Banc Case No.07-18-448 Page 9 of 15 erages Cor DECISION

Jesusi5, the Supreme Court held that entities found to be using corporate names that are either identical, deceptively or confusingly similar to one confusing, deceptive, or violative of existing laws. Hence, in Ang mga Kaanib sa Iglesia ng Dios kay Kristo Hesus v. Iglesia ng Dios kay Cristo change the same for being violative of Section 18 of the Corporation Code, thus: used by an existing corporation assume the risk of being directed to

peril; and the use of a name similar to one adopted by another functions, regardless of intent, may be prevented by the corporation having a prior right, by a suit for injunction against the new corporation to prevent the use of the name. (Emphasis corporation, whether a business or a nonprofit organization, if misleading or likely to injure in the exercise of its corporate supplied "Parties organizing a corporation must choose a name at their

applies when the two (2) requisites are shown to be present, to wit: Refractories Corporation of the Philippines vs. Court of Appeals, et al.16 that the prohibition on the use of corporate names that violates the rights of others and misleads the public under Section 18 of the Corporation Code In relation to the foregoing, the Supreme Court ruled in Industrial

(1} 2 That the complainant corporation acquired a prior right over the use of such corporate name; and The proposed name is either:

b. a. identical, or deceptively or confusingly similar to that of any

protected by law. existing corporation or to any other name already

Chamber of Commerce in the Philippines, Inc.17, the Court ruled as follows: to the use of a corporate name on the date of registration, the same being the date when the said corporation begins using such approved corporate name. Thus, in Indian Chamber of Commerce Phils., Inc. v. Filipino Indian priority of adoption rule which reckons the entitlement of a corporation As regards the first requisite, the Court has consistently applied the

Appeals, the Court applied the priority of adoption rule to "In Industrial Refractories Corporation of the Philippines v. Court of determine prior right, taking into consideration the dates when the parties used their respective corporate names. It ruled that

15 G.R. No. 137592, December 12, 2001 16 GR No. 122174, October 3, 2002 citing Philips Export B.V. vs. Court of Appeals 206 SCRA 457, 463 T7 G.R. 'No. 184008, August 3, 2016 [1992]

Panciteria Lido Chinese Cuisine,Co.vs. Salido Foods & Beverages Co SEC En Banc Case No.07-18-448 Page 10 of 15 DECISION

acquired the right to use the word "Refractories" as part of its corporate name.being its prior registrant on October 13.1976.The Court noted that IRCP only started using its corporate name when it amended its Articles of Incorporation on August 23, 1985." "Industrial Refractories Corporation of the Philippines" (IRCP), has "Refractories Corporation of the Philippines" (RCP), as opposed to

is no corporation to speak of. The foregoing finds support in Section 19 of the Corporation Code which specifically provides the exact moment when a corporation commences to have corporate existence and uses its Commission issues a certificate of incorporation under its official seal, thu corporate name i.e. from the date the Securities and Exchange with the Commission, the corporate name cannot as yet be used as there The reason for this lies in the fact that before an entity is registered

deemed incorporated from the date the Securities and Exchange and thereupon the incorporators, stockholders/members and their stated in the articles of incorporation for the period of time mentioned therein, unless said period is extended or the corporation is sooner dissolved in accordance with law." (Emphasis supplied) "A private corporation formed or organized under this Code commences to have corporate existence and juridical personality and is Commission issues a certificate of incorporation under its official seal; successors shall constitute a body politic and corporate under the name

Appellant has acquired the right to the use of its partnership name under the principle of prius tempore potior jure or first in time, stronger in right. that Appellant has acquired prior right over the use of its partnership name which includes the word "Lido" on the ground that Appellant was registered on 11 February 2009, or ahead of Appellee which was only registered on 31 August 2010. Consequently, being the prior registrant, On the basis of the foregoing parameters, We agree with the CRMD

consistently ruled that in determining if a corporate name is confusingly similar to that of a registered name or one that is protected by law, the test is whether the similarity is such as to mislead a person using ordinary care and discrimination.18 As regards the second requisite, the Supreme Court has

Family Bank - Thrift Bank v. BPI Family Bank19, that the probability or the likelihood of confusion suffices to bar any corporation from More importantly, the Supreme Court laid down the rule in GSIS

19 G.R. No. 175278, September 23, 2015 1s Philips Export B.V. et al. v. Court of Appeals et al., G.R. No. 96161, 21 February 1992

Panciteria Lido Chinese Cuisine, Co.vs. Salido Foods & Beverages Corp SEC En Banc Case No. 07-18-448 Page 11 of 15 DECISION

including word(s) that forms part thereof, to wit: using/adopting as its corporate name, one that is already registered,

discrimination. And even without such proof of actual confusion between the two corporate names, it suffices that confusion is probable or likely to occur." (Emphasis supplied) between petitioner's proposed name and respondent's corporate name, as found by the SEC. In determining the existence of confusing such as to mislead a person using ordinary care and "On the second point (b), there is a deceptive and confusing similarity similarity in corporate names,the test is whether the similarity is

that Appellee's use of the word "Salido" as part of its corporate name did Commission holds that the CRMD committed reversible error in finding not amount to an appropriation of the term "Lido" because the term "Salido" is a coined term which is unique in itself and is thus capable of exclusive appropriation by Appellee.20 Guided by, and applying the foregoing jurisprudential rules, this

Appellee admitted that the term "Lido" had its origin in a Fujian region specifically important as it is associated to King Si Biak who owned secret beginnings.22 and, in relation to the restaurant operation, the word/concept "Lido" is recipes21 which brought success to Panciteria Lido from its humble A careful examination of the records of the case will show that

to the term "Lido" in the word "Salido", to wit: Thus, it is notable that Appellee emphasizes and gives prominence

# R RESTAURA

part of its registered name as follows: Meanwhile, Appellant's uses and presents "Lido", a word that is

20 See Page 8 (Par. 4) of the Assailed Order 21 Par. 2 Of the Answer dated May 16, 2016 22 Par. 15 of the Answer dated May 16, 2016

Panciteria Lido Chinese Cuisine, Co.vs. Salido Foods & Beverages Corp SEC En Banc Case No.07-18-448 Page 12 of 15 DECISION

COGUNATSIN Lido

that in its signages, emphasis and prominence is given by Appellee to the word "Lido"23 such that together with "Sa" before it, the clear message conveyed to the public is that they are dining "at Lido" whenever they are being emphasized and given prominence, the word "Salido" will certainly not add value to the restaurant business of Appellee. This is because only "Lido" is associated with the recipes and tasty food of King Si Biak a.k.a. Mr. Lido. relating to the actual use by Appellee of "Salido", We hold that the adoption by Appellee of the word "Salido" as part of its corporate name was made with the clear intent of being able to use the word "Lido" which is part of the registered name of Appellants. This is supported by the fact Appellee's restaurants. Taken as a whole, and without the word "Lido" On the basis thereof, and considering the evidence on record

the beginning, violative of Section 18 of the Corporation Code because it was calculated and made for no other purpose but to facilitate Appellee's use and appropriation of the term "Lido" which, it admitted, is related to the restaurant serving the secret recipes of King Si Biak who was also known as Mr. Lido. word, the adoption and the actual use of the same by Appellee was from Thus, contrary to the finding of CRMD that "Salido" is a coined

Section 18 of the Corporation Code as the same was intended to facilitate appropriation by Appellee of the word "Salido" constitutes a violation of and justify the use of "Lido" which mislead the public into the belief that Consequently, this Commission holds that the use and

23 Par. 18 of the Answer

Panciteria Lido Chinese Cuisine,Co.vs Salido Foods & Beverages Corp SEC En Banc Case No. 07-18-448 Page 13 of 15 DECISION

Appellee's restaurants are owned and operated by Appellants24, a matter

proof of actual confusion between the parties' names, the position of this Partners, Inc. v. San Francisco Coffee & Roastery, Inc.25, that the likelihood that was proven by substantial evidence. Moreover, even without such Commission on the matter will not change on the ground that, as established in jurisprudence, it suffices that confusion is probable or likely to occur. Relative thereto, the High Court emphasized in Coffee

of confusion is higher when the parties are engaged in the same business, to wit:

of one corporation is the same or substantially the same as that of another corporation. "The likelihood of confusion is higher in cases where the business

trade name from then on must be free from any infringement by similarity." (Emphasis supplied) Respondent has acquired an exclusive right to the use of the trade name "SAN FRANCISCO COFFEE & ROASTERY, INC." since the registration of the business name with the DTI in 1995. Thus, respondent's use of its

(MC 14) as the same is misleading and confusingly similar to the Appellant's name, to wit: part of its corporate name violates Memorandum Circular No. 14 s. 2000 The Commission also finds that the use by Appellee of "Salido" as

"3(a) The name shall not be identical, misleading or confusingly similar to a corporate or partnership name registered with the Commission,or with the Department of Trade and Industry,in the case of sole proprietorships;" (Emphasis supplied)

name, it can continue to use the term "Lido", to the prejudice of the public. the issue on the purported confusion on the parties' names is a matter proper to the IPo because it was brought about by extraneous circumstances independent such names. The evidence showed that the use and appropriation by Appellee of its corporate name was specifically intended and calculated to facilitate and enable it to use "Lido", which has the IPO on an administrative case for violation of the Intellectual Property Code will not necessarily stop or prevent fraud on the public in relation to the use of a confusingly similar or misleading corporate name. As long as Appellee continues to have access to the use of its corporate mislead and will continue to mislead the public. A decision rendered by Moreover, the Commission does not agree with the argument that

25 G.R. No. 169504, March 3, 2010 + See Annex "I" of the Petition

Panciteria Lido Chinese Cuisine,Co.vs. Salido Foods & Beverages Corp SEC En Banc Case No. 07-18-448 Page 14 of 15 DECISION

In a similar manner, a corporation or partnership has no right to use a term/word as part of its name if the same is already part of the tradename. The reason for this is that both the letter and intent of Section registered name, and such use will mislead or confuse the public, even if the registered name is not registered with IPO as a trademark or

is misleading/confusing or is likely to mislead/confuse the public, and it 18 of the Corporation Code proscribes the use of a corporate name which

is the duty of this Commission to implement this for the protection of the public.

words "Lido" and "Salido" might still pass as not confusingly similar, While it is arguable, as observed by the CRMD, that on its face, the

however, the Commission finds that the evidence on record showing justifies the exercise of its regulatory power to implement Section 18 of Appellee's real intent in using "Salido" i.e. to use and appropriate "Lido"

the Corporation Code and to prevent the evils that it seeks to avoid which was explained in Ang mga Kaanib sa Iglesia ng Dios kay Kristo Hesus v. Iglesia ng Dios kay Cristo Jesus to wit:

"At any rate,the SEC has the authority to de-register at all times and under all circumstances co rporate names which in its estimation

confusion in the use of corporate names not only for the protection of the corporations involved but more so for the protection of the public." (Emphasis supplied) are likely to spawn confusion. It is the duty of the SEc to prevent

to disallow the use of names which, in its judgment, are misleading or deceptive, to wit: Relative thereto, the Commission is mandated in Par. 14 of MC 14

disallow the use of names that, in its judgment, are misleading, public morals, good customs and public policy." (Emphasis supplied) deceptive, confusingly similar to a registered name,or contrary to "Notwithstanding the foregoing, the Commission shall, for the protection of the public interest and other justifiable causes,

its corporate name, fully aware based on the evidence on record, that such use was intentionally and carefully made for no other purpose but to have access to the use of the term "Lido" which it accorded prominence will continue to allow Appellee to use and appropriate "Salido" as part of and is central to its corporate name. The Commission will be remiss of its duty to protect the public if it

Finally, it should be emphasized that in relation to the effective implementation of Section 18 of the Corporation Code, Appellee made an express undertaking in its Articles of Incorporation to change its

Panciteria Lido Chinese Cuisine, Co. vs. Salido Foods & Beverages Corp SEC En Banc Case No. 07-18-448 Page 15 of 15 DECISION

corporate name in the event another person, firm, or entity has acquired a prior right to use the said firm name or one deceptively or confusingly similar to it, immediately upon receipt of notice or directive from the

requiring the Appellee to comply with this undertaking is in order. Commission. In light of the findings of this Commission, the propriety of

Corporate Name against Appellee is hereby REVERSED and SET ASIDE. GRANTED. The Assailed Order of the Company Registration and Monitoring Department dismissing Appellant's Petition to Change WHEREFORE, premises considered, the instant Appeal is hereby

SO ORDERED.

Makati City, Philippines.

EMILIO B.AQUINO Chairberson

JAVE Commissioner PAUL D.FRANCISCO KEIAN Commissioner LEE

KARLO S.BELLO* Commissioner MCJILL BRYANT T. FERNANDEZ Commissioner

*On Official Business