G.R. No.

96161 February 21, 1992
PHILIPS EXPORT B.V., PHILIPS ELECTRICAL LAMPS, INC. and PHILIPS
INDUSTRIAL DEVELOPMENT v. COURT OF APPEALS, SECURITIES &
EXCHANGE COMMISSION and STANDARD PHILIPS
CORPORATION,respondents.
FACTS:

Petitioner Philips Export B.V. (PEBV), aforeign corporation organized
under the laws of the Netherlands, although not engaged in business
here, is the registered owner of the trademarks PHILIPS and PHILIPS SHIELD
EMBLEM .

Respondent Standard Philips Corporation (Standard Philips), on the
other hand, was issued a Certificate of Registration by respondent
Commission on 19 May 1982.

Petitioners filed a letter complaint with the Securities & Exchange
Commission (SEC) asking for the cancellation of the word “PHILIPS” from
Private Respondent’s corporate name.

As a result of Private Respondent’s refusal to amend its Articles of
Incorporation, Petitioners filed with the SEC. Alleging, among others, that
Private Respondent’s use of the word PHILIPS amounts to an infringement
and clear violation of Petitioners’ exclusive right to use the same
considering that both parties engage in the same business.

Private Respondent countered that Petitioner PEBV has no legal
capacity to sue; that its use of its corporate name is not at all similar to
Petitioners’ trademark PHILIPS when considered in its entirety; and that its
products consisting of chain rollers, belts, bearings and cutting saw are
grossly different from Petitioners’ electrical products.
ISSUE: WON petitioner may sue private respondent.
HELD: YES.

The Court declared that a corporation’s right to use its corporate and
trade name is a property right, a rightin rem, which it may assert and
protect against the world in the same manner as it may protect its tangible
property, real or personal, against trespass or conversion. It is regarded, to
a certain extent, as a property right and one which cannot be impaired or
defeated by subsequent appropriation by another corporation in the same
field.

expressly provides that: 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 law or is patently deceptive. two requisites must be proven. confusing or contrary to existing law. Petitioner PEBV has also used the trademark “PHILIPS” .  A corporation acquires its name by choice and need not select a name identical with or similar to one already appropriated by a senior corporation while an individual’s name is thrust upon him. and essential to its identity. Its name is one of its attributes. namely: (1) that the complainant corporation acquired a prior right over the use of such corporate name. respectively. there is no doubt with respect to Petitioners’ prior adoption of’ the name ”PHILIPS” as part of its corporate name. or (b) deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law. and (2) the proposed name is either: (a) identical. confusing or contrary to existing law. or (c) patently deceptive. while Respondent Standard Philips was issued a Certificate of Registration on 12 April 1982. To come within its scope. p. an element of its existence. A name is peculiarly important as necessary to the very existence of a corporation. the commission shall issue an amended certificate of incorporation under the amended name. 16). twenty-six (26) years later (Rollo. in its Section 18. The statutory prohibition cannot be any clearer.  In this regard. A corporation can no more use a corporate name in violation of the rights of others than an individual can use his name legally acquired so as to mislead the public and injure another  Our own Corporation Code. Petitioners Philips Electrical and Philips Industrial were incorporated on 29 August 1956 and 25 May 1956.Where a change in a corporate name is approved.

PHILIPS ELECTRICAL LAMPS. to wit: PHILIPS EXPORT B. have the exclusive right to its use which must be free from any infringement by similarity. PEBV.S. is that PHILIPS is a trademark or trade name which was registered as far back as 1922.on electrical lamps of all types and their accessories since 30 September 1922. which may be protected by injunction upon a principle similar to that upon which persons are protected in the use of trademarks and tradenames (18 C. Such principle proceeds upon the theory that it is a fraud on the corporation which has acquired a right to that name and perhaps carried on its business thereunder.  However. In so doing..  Their action is based on a SEC Resolution wherein SEC ordered the Lyceum of Baguio to change its corporate name as it is identical to the Lyceum of the Philippines which was able to register first. (Sept)  In 1984. the dominant word in that all the companies affiliated or associated with the principal corporation. however. that another should attempt to use the same name. INC. While the corporate names of Petitioners and Private Respondent are not identical. therefore. the CA ruled otherwise.  What is lost sight of. NO . A corporation has an exclusive right to the use of its name.  SEC En Banc ruled that the attaching of the geographical names after the word “Lyceum” sufficiently distinguishes one from the other. Issue No. INC. inevitably leads one to conclude that “PHILIPS” is. In determining the existence of confusing similarity in corporate names.1: WON the corporate names of the parties are identical with or deceptively similar to that of the petitioner. is an educational institution duly registered with Securities and Exchange Commission since 1950. a reading of Petitioner’s corporate names.V.. the Court must look to the record as well as the names themselves. it instituted proceedings before SEC to compel several education institutions to delete the word “Lyceum” from their corporate names and to permanently enjoin them from using the said word. Inc. are known in the Philippines and abroad as the PHILIPS Group of Companies. the test is whether the similarity is such as to mislead a person. or the same name with a slight variation in such a way as to induce persons to deal with it in the belief that they are dealing with the corporation which has given a reputation to the name. using ordinary care and discrimination. indeed.J.  The second requisite no less exists in this case. Facts:  Lyceum of the Philippines. 574). Petitioners. and PHILIPS INDUSTRIAL DEVELOPMENT.

there may be other schools using the name but not registered with the SEC because they have not adopted the corporate form of organization. It may be noted that one of the respondents – Western Pangasinan Lyceum used such term 17 years before the petitioner registered with the SEC. Western Pangasinan Lyceum — 27 October 1950 Lyceum of Cabagan — 31 October 1962 Lyceum of Lallo. Inc. might nevertheless have been used so long and so exclusively by one producer with reference to his article that. NO Held: Doctrine of Secondary meaning is a word of phrase originally incapable of exclusive appropriation. Issue No. — 26 March 1972 Lyceum of Aparri — 28 March 1972 Lyceum of Tuao. Lyceum generally refers to a school or an institution of learning and it is natural to use this word to designate an entity which is organized and operating as an educational institution.Held: The corporate names of the parties carry the word “Lyceum” but confusion and deception are precluded by the appending of geographic names. in trade and to that branch of the purchasing public. Lyceum of the Philippines has not gained exclusive use of “Lyceum” by long passage of time. (Doctrine of Secondary meaning). Thus. The number alone of the private respondents suggests strongly that the use of Lyceum has not been attended with the exclusivity essential for the applicability of the doctrine. or that the "Lyceum of Camalaniugan" would be confused with the Lyceum of the Philippines. DOCTRINE: Doctrine of secondary meaning can be extended to corporation name but must comply with the requirement that it has been used so long and so exclusively by one and that the said name has come to mean that it is referred to as that corporation. 2: WON the use by the Lyceum of the Philippines of the word Lyceum in its corporate name has been for such length of time and with such exclusivity as to have become associated or identified with the petitioner institution in the mind of the general public. we do not believe that the "Lyceum of Aparri" can be mistaken by the general public for the Lyceum of the Philippines. the word or phrase has come to mean that the article was his product. — 28 March 1972 Lyceum of Camalaniugan — 28 March 1972 . Moreover. Inc.

INC. 1993  LYCEUM OF THE PHILIPPINES." in other places... LYCEUM OF CABAGAN. Mercedelin Potenciano. entered into a Sale and Purchase Agreement. authorized the sale of its shares in BLTB and the execution of the Agreement. 2001 FACTS: On October 28. and WESTERN PANGASINAN LYCEUM." Lyceum" is in fact as generic in character as the word "university. INC. LYCEUM OF TUAO.. No.. the word "Lyceum" is the Latin word for the Greek lykeion which in turn referred to a locality on the river Ilissius in ancient Athens "comprising an enclosure dedicated to Apollo and adorned with fountains and buildings erected by Pisistratus. petitioner. LYCEUM OF SOUTHERN PHILIPPINES. Max Joseph Potenciano.R. the Secretary's Certificate stating that the Board of Directors of Maya Industries." or "Liceo" or "Lycee" frequently denotes a secondary school or a college. INC.071. No. The contracting parties stipulated that the downpayment was conditioned upon receipt by the buyer of certain documents upon signing of the Agreement. INC vs. The said shares represented 47. "Lyceum" appears to be a substitute for "university. respondents BATANGAS LAGUNA TAYABAS BUS COMPANY. No. represented by its President. Inc. LYCEUM OF EASTERN MINDANAO.425." In the name of the petitioner. INC.Etymologically. The purchase price for the shares of stock was P72. LYCEUM OF APARRI. CENTRAL LYCEUM OF CATANDUANES. Inc. BITANGA G. however. 137936 August 10. whereby they sold to BMB Property Holdings.114 shares of stock in BLTB... Benjamin Bitanga. A downpayment was made while the balance was payable on November 26. . Pericles and Lycurgus frequented by the youth for exercise and by the philosopher Aristotle and his followers for teaching. INC. INC.R. "Lyceum. vs. BUHI LYCEUM. and Maya Industries..076. Inc. LYCEUM OF CAMALANIUGAN.00.98% of the total outstanding capital stock of BLTB. 1997. Delfin Yorro. namely. 101897  March 5. 1997. Citation:  G. LYCEUM OF LALLO. Dolores Potenciano. 137934/ G. COURT OF APPEALS.R. their 21.

at a meeting of the stockholders of BLTB. 1998. indicating no taxable gain on the same. 1998. The Potenciano group was re-elected to the Board of Directors. 1997. Potenciano for purposes of the Agreement. Jr. Furthermore.and designating Dolores A. however. Their prayer for the issuance of a temporary restraining order was. a revocable proxy to vote the subject shares made by the sellers in favor of the buyer. The SEC Chairman Perfecto Yasay. Jr. arrived and attended the meeting. On the scheduled date of the meeting. Laguna. the Special Power of Attorney executed by each of the sellers in favor of Dolores A. Eduardo Azucena. The majority of the stockholders present rejected the postponement and voted to proceed with the meeting. Leveriza were elected as directors. Siy and Renato L. and the duly executed capital gains tax return forms covering the sale. a Complaint for Injunction and Damages with Preliminary Injunction and Temporary Restraining Order with the SEC. and a new set of officers was thereafter elected. to be held at the principal office of BLTB in San Pablo. Likewise. wherein Laureano A. Before the scheduled meeting. except Henry John A. 1997. another stockholders' meeting was held. At the same meeting. issued a temporary restraining order enjoining the Bitanga group from acting as . and Gemma Santos as officers. 1998. 1998. Evelio Custodia. the Board of Directors of BLTB elected James Olayvar. requesting for a postponement of the stockholders' meeting due to the absence of a thirty-day advance notice. Michael A. the Bitanga group filed with the SEC a Complaint for Damages and Injunction. inasmuch as there was no notice of postponement prior to that. the buyer guaranteed that it shall take over the management and operations of BLTB but shall immediately surrender the same to the sellers in case it fails to pay the balance of the purchase price on November 26. the newly elected directors of BLTB scheduled the annual stockholders' meeting on May 19. a Declaration of Trust made by the sellers in favor of the buyer acknowledging that the subject shares shall be held in trust by the sellers for the buyer pending their transfer to the latter's name. However. During a meeting of the Board of Directors on April 14. denied at the exparte summary hearing conducted by SEC Chairman Perfecto Yasay. Potenciano. On November 21. on November 28. the undated written resignation letters of the Directors of BLTB. a total of 286 stockholders. no response from Bitanga on whether or not the request for postponement was favorably acted upon. Michael Potenciano wrote Benjamin Bitanga. representing 87% of the shares of stock of BLTB. Benjamin Bitanga and Monina Grace Lim were elected as directors of the corporation Subsequently. the Potenciano group filed on May 25. Potenciano. Potenciano as its Attorney-in-Fact. On May 21. Potericiano and Candido A. 1997.

after the Potencianos posted the required bond of P20. reversing the assailed Orders of the SEC En Banc and reinstating the Order of the Hearing Panel ordered dated June 17. the SEC En Banc set aside the June 17. seeking a writ of preliminary injunction to restrain the implementation of the Hearing Panel's assailed Order. A joint hearing was conducted. On July 21. is two-fold: to enable the transferee to exercise all the rights of a stockholder.26% of BLTB's shares having purchased the same from the Potenciano group. followed by a Supplemental Petition on August 10. cannot be effective as against the corporation. 1998. 1998 was void since BMB Holdings. ISSUE: Whether or not the stockholders' meeting on May 19. Meanwhile. 1998. 1998. On November 23. the transfer.00. there was no quorum. 1998. the Bitanga group filed another complaint with application for a writ of preliminary injunction and prayer for temporary restraining order. on July 29. The purpose of registration. including the right to vote and to be voted for.officers and directors of BLTB. Hence. 1998. though valid between the parties. 1999. 1998. 1998. the Bitanga group in this case. It declared that the May 19. On June 8. represented by the Bitanga group was not present at the said meeting. Thus.000. the CA rendered the now assailed Decision. since BMB Holdings. 1998 stockholders' meeting. On June 17. The Potenciano group filed a petition for certiorari with the SEC En Banc on June 29. Until challenged in a proper . which then owned 50. RULING: Until registration is accomplished.000. 1998 stockholders' meeting was void on the grounds that.. and to inform the corporation of any change in share ownership so that it can ascertain the persons entitled to the rights and subject to the liabilities of a stockholder. represented by the Bitanga group. seeking to annul the May 19. cannot vote nor be voted for. therefore..000. Inc. was not present at the said meeting. The CA denied the Motions for Reconsideration in a Resolution dated March 25.000.00. 1998. Michael Potenciano had himself asked for its postponement due to improper notice. the SEC Hearing Panel granted the Bitanga group's application for a writ of preliminary injunction upon the posting of a bond in the amount of P20. and. first. The Bitanga group immediately filed a petition for certiorari with the Court of Appeals on July 22. The Hearing Panel further held that the Bitanga Board remains the legitimate Board in a holdover capacity. 1998 Order of the Hearing Panel and issued the writ of preliminary injunction prayed for. the SEC En Banc issued a writ of preliminary injunction against the Bitanga group. the unrecorded transferee. 1998. second. Inc. this petition for review.

No. SP No. EB 611 are ordered REINSTATED. Guerrero. in view of all the foregoing. executed a Deed of Assignment for the remaining one (1) share of stock in favor of private respondent Francisco Guerrero. 1999 are SET ASIDE. Rural Bank of Salinas Inc. vs. private respondent Melania Guerrero. to execute the proper documents therefor. his vote can be properly counted to determine whether a stockholders' resolution was approved. On February 27. Inc. Almost four months later. Clemente G. 49 and 65). 1980. a person who has purchased stock. executed a Deed of Assignment for 472 shares out of the 473 shares. giving and granting the latter full power and authority to sell or otherwise dispose of and/or mortgage 473 shares of stock of the Bank registered in his name (represented by the Bank's stock certificates nos. a stockholder of record has a right to participate in any meeting. and who desires to be recognized as a stockholder for the purpose of voting.R. Sr. Wilhelmina Rosales (10 shares) and Francisco Guerrero. June 26. Until the transfer is registered. executed a Special Power of Attorney in favor of his wife. must secure such a standing by having the transfer recorded on the corporate books. (5 shares). private respondent Melania Guerrero. 1998 in CA-G. the transferee is not a stockholder but an outsider. 1998 and July 27. 1992 FACTS: On June 10. President of the Rural Bank of Salinas. pursuant to the same Special Power of Attorney. 1980. the instant petitions for review are GRANTED. The Decision of the Court of Appeals dated November 23. and to receive and sign receipts for the dispositions. 26.R. WHEREFORE. . 48374 and its resolution dated March 25. and pursuant to said Special Power of Attorney. private respondent Melania Guerrero. 1979. The Orders of the SEC En Banc dated July 21. CA (supra) G. 1998 in SEC Case No.proceeding. in favor of private respondents Luz Andico (457 shares). Jr. 96674. as Attorney-in-Fact. On the other hand. despite the claim of the alleged transferee. or two (2) days before the death of Clemente Guerrero on June 24..

private respondent Melania Guerrero filed with the Securities and Exchange Commission" (SEC) an action for mandamus against petitioners Rural Bank of Salinas. Lim Tay v. Thus. This is because the corporation's obligation to register is ministerial. However. 1979. Cf. the person requesting the registration must be the prima facie owner of the shares. however. (Note. its President and Corporate Secretary. private respondent Melania Guerrero presented to petitioner Rural Bank of Salinas the two (2) Deeds of Assignment for registration with a request for the transfer in the Bank's stock and transfer book of the 473 shares of stock so assigned. On December 5. since the person who sought the transfer of shares had express instructions from and specific authority given by the registered stockholder to cause the disposition of stocks registered in his name. mandamus will lie to compel the officers of the corporation to transfer said stock in the books of the corporation.Subsequently. there was a clear duty on the part of the corporate secretary to register the 473 shares in favor of the new owners. The case was docketed as SEC Case No. HELD: YES. 293 SCRA 634) . petitioner Bank denied the request of respondent Melania Guerrero. Based on those circumstances. whenever a corporation refuses to transfer and register stock. that in such cases. The right of a transferee/assignee to have stocks transferred to his name is an inherent right flowing from his ownership of the stocks. 1980. Guerrero. the cancellation of stock certificates in the name of Clemente G. and the issuance of new stock certificates covering the transferred shares of stocks in the name of the new owners thereof. CA. ISSUE: WON the corporate secretary is compelled to register the said transfer of shares.

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