Kensonic, Inc. vs. Uni-Line Multi-Resources, Inc.

A generic term may be appropriated as a trademark if it is not descriptive of the specific goods it identifies, and the cancellation of a trademark registration cannot extend to goods that are unrelated to those of the prior registrant under the multi-factor test in Mighty Corporation v. E. & J. Gallo Winery, regardless of whether the later goods fall within the same Nice Classification or are merely a potential expansion of the prior registrant’s business.

Kensonic, Inc. introduced the SAKURA mark in the Philippines in 1994 for electronic audio-video equipment such as amplifiers, speakers, car stereos, televisions, and DVD/VCD players, and owned prior registrations for those goods under Class 09 of the Nice Classification. Uni-Line Multi-Resources, Inc. (Phils.) later filed multiple trademark applications for SAKURA covering a broad range of electrical and home appliances under Classes 07, 09, and 11. Disputes between the parties had already produced final rulings in earlier inter partes cases affirming Kensonic’s prior use and ownership of the SAKURA mark for Class 09 goods. The present controversy originated from Uni-Line’s successful registration in 2006 of the SAKURA mark for goods in Classes 07, 09, and 11, which Kensonic then sought to cancel in its entirety.

• Prior Registration and Ownership: Kensonic, Inc. had used the trademark SAKURA on electronic audio-video products (amplifiers, speakers, cassette decks, car stereos, televisions, DVD/VCD players, etc.) in the Philippines since 1994. Its ownership of the mark for goods falling under Class 09 was affirmed in previous BLA proceedings that attained finality.

• Uni-Line’s Registration: Uni-Line Multi-Resources, Inc. (Phils.) filed an application for the SAKURA mark on June 6, 2002 covering goods in three classes. After publication without opposition, Certificate of Registration No. 4-2002-004572 issued effective March 18, 2006 for the following:

  • Class 07: Washing machines, high pressure washers, vacuum cleaners, floor polishers, blender, electric mixer, electrical juicer;
  • Class 09: Television sets, stereo components, DVD/VCD players, voltage regulators, portable generators, switch breakers, fuse;

  • Class 11: Refrigerators, air conditioners, oven toaster, turbo broiler, rice cooker, microwave oven, coffee maker, sandwich/waffle maker, electric stove, electric fan, hot & cold water dispenser, airpot, electric griller, electric hot pot.

  • Cancellation Proceedings: Kensonic filed a petition for cancellation with the BLA on September 7, 2006, invoking its prior use and the final rulings in earlier inter partes cases. The BLA cancelled the entire registration, finding the marks confusingly similar and the goods related. On appeal, the Director General modified the decision, upholding cancellation only for the Class 09 goods while allowing Classes 07 and 11 to stand, reasoning that the Class 07 and 11 goods were home appliances not related to Kensonic’s audio-video products, and that purchasers of such expensive items exercise careful examination.

  • Nature of the Contested Goods: Kensonic’s registered Class 09 goods are information technology and audiovisual equipment, final consumer products. Uni-Line’s Class 09 goods (voltage regulators, portable generators, switch breakers, fuses) are apparatus and devices for controlling the distribution and use of electricity, functioning as spare parts rather than final products. Uni-Line’s Class 07 and 11 goods are home appliances, distinct from Kensonic’s electronic entertainment devices.

• Kensonic (G.R. Nos. 211820-21):

  • Relatedness of Class 07 and 11 Goods: Kensonic argued that Uni-Line’s goods under Class 07 and Class 11 are related to its Class 09 goods; the use of identical marks on related goods is likely to cause confusion regarding the source of the goods.
  • Normal Potential Expansion: Kensonic maintained that the contested goods fall within the normal potential expansion of its business, and that trademark protection should extend to such goods.

• Uni-Line (G.R. Nos. 211834-35):

  • Generic Nature of the Mark: Uni-Line contended that “SAKURA” is merely the Japanese term for cherry blossom, a generic word that cannot be appropriated as a trademark by any single entity.
  • Unrelatedness of Class 09 Goods: Uni-Line argued that its voltage regulators, portable generators, switch breakers, and fuses are not electronic products akin to Kensonic’s audio-video equipment; they are apparatuses for controlling electricity and are unrelated to Kensonic’s line of business.
  • Factual Challenge Barred: Uni-Line asserted that the lower tribunals erred in treating all Class 09 goods as related without examining the specific sub‑classifications and actual uses.

• Kensonic (as respondent to Uni-Line’s petition):

  • Settled Ownership: Kensonic countered that its ownership of the SAKURA mark by prior use since 1994 had been conclusively determined in earlier IPO decisions that are final and executory, precluding any further challenge.
  • Relatedness of Class 09 Goods: Kensonic argued that voltage regulators, portable generators, switch breakers, and fuses are accessories or components closely related to its electronic products and are encompassed by the same general class of goods.
  • Likelihood of Confusion: The identity of the marks, combined with the relatedness of the goods, creates a likelihood of confusion as to the source of the products.

• Uni-Line (as respondent to Kensonic’s petition):

  • Distinct Nature of Goods: Uni-Line maintained that its Class 07 and 11 goods are home appliances that are not related to Kensonic’s audio-video equipment; consumers of such relatively expensive and durable goods exercise careful scrutiny, making confusion unlikely.
  • Absence of Damage: Uni-Line argued that Kensonic failed to present evidence showing that the continued registration of the SAKURA mark for Classes 07 and 11 would cause actual damage or dilute its own mark.

• Appropriability of the SAKURA Mark: Whether the word “SAKURA” is a generic term incapable of exclusive appropriation as a trademark.
• Relatedness of Class 07 and 11 Goods: Whether Uni-Line’s goods under Class 07 (washing machines, vacuum cleaners, blenders, etc.) and Class 11 (refrigerators, air conditioners, rice cookers, etc.) are related to Kensonic’s Class 09 goods.
• Relatedness of Specific Class 09 Goods: Whether Uni-Line’s Class 09 goods, namely voltage regulators, portable generators, switch breakers, and fuses, are related to Kensonic’s Class 09 audio-video goods.

• Appropriability of the SAKURA Mark: The SAKURA mark is capable of appropriation. Section 123(h) of the Intellectual Property Code prohibits the registration of a trademark that is generic for the goods or services it seeks to identify. Although “SAKURA” denotes the Japanese flowering cherry and is therefore a generic term, it does not describe or identify Kensonic’s DVD/VCD players or other electronic products. Unlike the mark “Pale Pilsen,” which directly described the beer in Asia Brewery, Inc. v. Court of Appeals, SAKURA bears no descriptive relation to the goods. Consequently, it is not barred from registration. Moreover, Kensonic’s ownership by prior use since 1994 had been settled in earlier proceedings and could not be revisited in a Rule 45 petition limited to questions of law.

• Relatedness of Class 07 and 11 Goods: The Class 07 and 11 goods are not related to Kensonic’s Class 09 goods. Applying the factors enumerated in Mighty Corporation v. E. & J. Gallo Winery — including the business to which the goods belong, the class of product, quality, descriptive properties, purpose, nature and cost of the articles, and channels of trade — the goods differ significantly. Uni-Line’s products are home appliances, not ordinary everyday consumables; they are relatively expensive items that a purchaser would examine carefully. The prohibition against registration under Section 123 of the IP Code does not extend to goods that a registrant might produce in the future, as such an expansion is based on mere possibility and conjecture. Protection is limited to goods that are actually related.

• Relatedness of Specific Class 09 Goods: The voltage regulators, portable generators, switch breakers, and fuses are not related to Kensonic’s Class 09 goods. As held in Taiwan Kolin Corporation, Ltd. v. Kolin Electronics, Co., Inc., mere inclusion in the same Nice Class does not automatically render goods related; sub‑classifications within the Class must be considered. Kensonic’s products fall under the sub‑class of information technology and audiovisual equipment (final consumer products), while Uni-Line’s contested items belong to the sub‑class of apparatus and devices for controlling the distribution and use of electricity (spare parts). These distinctions preclude a finding of relatedness.

• Generic Mark Doctrine — A trademark consisting exclusively of a sign generic for the goods or services it identifies is prohibited from registration under Section 123(h) of the Intellectual Property Code. However, a generic term that is not descriptive of, and does not identify, the specific goods in question may be appropriated as a valid trademark (citing Asia Brewery, Inc. v. Court of Appeals, G.R. No. 103543, July 5, 1993).

• Relatedness of Goods Test — To determine whether non-competing goods are related, the following factors must be considered: (a) the business and its location to which the goods belong; (b) the class of product; (c) the product’s quality, quantity, size, including the nature of the package, wrapper, or container; (d) the nature and cost of the articles; (e) the descriptive properties, physical attributes, or essential characteristics with reference to their form, composition, texture, or quality; (f) the purpose of the goods; (g) whether the article is bought for immediate consumption (day-to-day household items); (h) the fields of manufacture; (i) the conditions under which the article is usually purchased; and (j) the channels of trade through which the goods flow, how they are distributed, marketed, displayed, and sold (adopting the test in Mighty Corporation v. E. & J. Gallo Winery, G.R. No. 154342, July 14, 2004).

• Nice Classification Not Dispositive — The inclusion of goods in the same Nice Classification is merely one of many factors to consider; it does not by itself establish that the goods are related. Sub‑classifications within a class may demonstrate that the goods belong to distinct categories and are unrelated (reiterating Taiwan Kolin Corporation, Ltd. v. Kolin Electronics, Co., Inc., G.R. No. 209843, March 25, 2015).

• No Preemptive Right Over Potential Expansion — A trademark registrant cannot preclude future registrants from using a similar mark on goods that the registrant might produce in the future. The right to a trademark does not rest on mere possibilities and conjectures; protection is confined to goods that are actually related.

• “Although SAKURA refers to the Japanese flowering cherry and is, therefore, of a generic nature, such mark did not identify Kensonic's goods unlike the mark in Asia Brewery, Inc., v. Court of Appeals. Kensonic's DVD or VCD players and other products could not be identified with cherry blossoms. Hence, the mark can be appropriated.”

• “In resolving whether goods are related, several factors come into play: (a) the business (and its location) to which the goods belong (b) the class of product to which the goods belong (c) the product's quality, quantity, or size, including the nature of the package, wrapper or container (d) the nature and cost of the articles (e) the descriptive properties, physical attributes or essential characteristics with reference to their form, composition, texture or quality (f) the purpose of the goods (g) whether the article is bought for immediate consumption, that is, day-to-day household items (h) the fields of manufacture (i) the conditions under which the article is usually purchased and (j) the channels of trade through which the goods flow, how they are distributed, marketed, displayed and sold.”

• “It is not sufficient to state that the goods involved herein are electronic products under Class 9 in order to establish relatedness between the goods, for this only accounts for one of many considerations enumerated in Mighty Corporation.”

• Asia Brewery, Inc. v. Court of Appeals, G.R. No. 103543, July 5, 1993 — Distinguished; the generic words “pale pilsen” were descriptive of the beer, whereas “SAKURA” does not describe Kensonic’s electronic goods, making the mark appropriable.

• Mighty Corporation v. E. & J. Gallo Winery, G.R. No. 154342, July 14, 2004 — Relied upon for the multi-factor test to determine whether non-competing goods are related; the Court applied these factors to conclude that Uni-Line’s goods were unrelated.

• Taiwan Kolin Corporation, Ltd. v. Kolin Electronics, Co., Inc., G.R. No. 209843, March 25, 2015 — Relied upon for the rule that goods falling under the same Nice Class are not automatically related and that sub‑classifications within Class 9 must be considered.

• Tongonan Holdings and Development Corporation v. Escaño, Jr., G.R. No. 190994, September 7, 2011 — Cited to distinguish questions of law from questions of fact, reinforcing that the Supreme Court is not a trier of facts in a Rule 45 petition.

• Section 123(h), Republic Act No. 8293 (Intellectual Property Code) — Prohibits registration of a mark consisting exclusively of signs that are generic for the goods or services they seek to identify. Applied to hold that SAKURA, though a generic word, is not generic for electronic goods and may therefore be registered.

• Section 121.1, Intellectual Property Code — Defines a “mark” as any visible sign capable of distinguishing the goods or services of an enterprise. Used to distinguish the SAKURA trademark from copyright.

• Section 1, Rule 45, Rules of Court — Limits petitions for review on certiorari to questions of law; invoked to bar Uni-Line’s attempt to re-litigate Kensonic’s ownership of the mark based on factual evidence.

• Section 4, Rule 3, Internal Rules of the Supreme Court — Provides that factual findings of lower courts are generally binding on the Court; noted in affirming that Kensonic’s priority of use was a settled factual matter.

Velasco, Jr., Leonen, Martires, and Gesmundo, JJ., concurred. No separate concurring opinions were registered.