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MCDONALD'S CORPORATION v. MACJOY FASTFOOD CORPORATION

FACTS:

McDonald's Corporation filed a petition for review on certiorari seeking the reversal of the Court of Appeals' decision and resolution in CA-G.R. SP No. 57247. The decision and resolution reversed the Intellectual Property Office's (IPO) rejection of MacJoy FastFood Corporation's application for the registration of the trademark "MACJOY & DEVICE." MacJoy, a domestic corporation engaged in the sale of fast food products, filed an application for the trademark registration with the IPO. McDonald's opposed the application, claiming that the "MACJOY & DEVICE" mark resembled its corporate logo and various trademarks. The IPO sustained McDonald's opposition and rejected MacJoy's application. MacJoy then filed a petition for review with the Court of Appeals, which reversed the IPO's decision and ordered the IPO to give due course to the application. McDonald's appealed the CA's decision to the Supreme Court, arguing that the trademarks were confusingly similar under the Dominancy Test and that the CA erred in ruling that the IPO decision was not based on substantial evidence. MacJoy claimed that the petition should be dismissed for being procedurally defective and that the CA committed no reversible error in its ruling. The Supreme Court found merit in McDonald's petition and decided to review the case.

ISSUES:

  1. Whether the petition is procedurally defective.

  2. Whether the Court is the proper venue to consider factual issues.

  3. Whether there is a confusing similarity between the MCDONALD'S marks and the respondent's "MACJOY & DEVICE" trademark.

  4. Whether the marks "MCDONALD'S" and "MACJOY & DEVICE" are confusingly similar.

  5. Who has the rightful claim of ownership over the marks.

  6. Whether the respondent's use of "MACJOY & DEVICE" on its restaurant business and food products infringes upon the petitioner's trademark rights.

  7. Whether the respondent can claim ownership of the word "Mac" as a personal name and therefore cannot be monopolized as a trademark.

RULING:

  1. The petition is not procedurally defective as the person who executed and signed the certification against forum shopping has the authority to do so.

  2. The Court can consider factual issues when the findings of the appellate court are mistaken, absurd, speculative, conjectural, conflicting, tainted with grave abuse of discretion, or contrary to the findings of the court of origin.

  3. The dominancy test should be applied in determining confusing similarity between trademarks. The IPO used the dominancy test and found confusing similarity between the marks, while the CA used the holistic test and found no confusing similarity. The Court agrees with the petitioner that the dominancy test should be applied in this case.

  4. The Court ruled that the marks "MCDONALD'S" and "MACJOY & DEVICE" are confusingly similar. The Court applied the dominancy test and considered the visual, aural, connotative comparisons, and overall impressions of the marks. Both marks use the corporate "M" design logo and the prefixes "Mc" and/or "Mac" as dominant features, and are used in the sale of fast food products. The minor differences in styles and variations are overshadowed by the similarity of the predominant features. The Court concluded that an ordinary purchaser can conclude an association or relation between the marks.

  5. The Court ruled that the petitioner, McDonald's, has the rightful claim of ownership over the marks. McDonald's has registered its "MCDONALD'S" marks successively and has established its ownership of the marks. On the other hand, the respondent's application for registration of its trademark "MACJOY & DEVICE" was filed after McDonald's registration and first use of its marks.

  6. The Supreme Court held that the respondent's use of "MACJOY & DEVICE" on its restaurant business and food products is an infringement upon the petitioner's trademark rights. The requirement of actual use in commerce in the Philippines for trademark registration is not confined to a certain region, province, city, or barangay. Moreover, the respondent failed to overcome the presumption of validity of the petitioner's registered trademark. The court also rejected the respondent's claim that the word "Mac" cannot be monopolized as a trademark because it is a personal name. The court found no evidence to support the claim and concluded that the respondent's choice of the word "MACJOY" was to ride on the established reputation and goodwill of the petitioner's McDonald's marks.

PRINCIPLES:

  • The registration of a trademark is subject to the provisions of Section 4(d) of Republic Act No. 166, which prohibits the registration of a mark or trade name that resembles a mark or trade name previously registered or used in the Philippines by another.

  • In determining similarity and likelihood of confusion between trademarks, two tests have been developed: the dominancy test and the holistic test. The dominancy test focuses on the similarity of the prevalent features of the competing trademarks, while the holistic test considers the entirety of the marks, including labels and packaging.

  • Precedents in trademark cases should be applied only if they are specifically in point and must be studied in the light of the facts of the particular case. The Court has consistently applied the dominancy test in recent cases with similar factual situations.

  • The dominancy test is used to determine whether marks are confusingly similar. It considers the dominant features in the competing marks and gives greater weight to the similarity of appearance, aural and visual impressions, disregarding minor differences.

  • Confusing similarity is determined based on visual, aural, connotative comparisons, and overall impressions of marks encountered in the marketplace.

  • Ownership of a registered mark is prima facie presumed once registered.

  • Actual use in commerce in the Philippines is required for trademark registration.

  • The validity of a registered trademark is presumed.

  • When a trademark or label closely resembles one already used and registered by another, the application for registration should be rejected to avoid confusion and protect the already used and registered trademark and goodwill.