Doctrine: Ownership of the warehouse is not an element of unfair competition. The elements of unfair competition are (1) confusing similarity in the general appearance of the goods; and (2) intent to deceive the public and defraud a competitor.
Facts: The National Bureau of Investigation (NBI) applied for the issuance of search warrants for the search of a warehouse allegedly owned by Michael Tan a.k.a. Paul D. Tan (
Orespondent). The application alleged that the respondent had in his possession counterfeit shampoo products which were being sold, retailed, distributed, dealt with or intended to be disposed of, in violation of Section 168, in relation with Section 170, of Republic Act (R.A.) No. 8293, otherwise known as the Intellectual Property Code of the Philippines.
On the same date, Judge Antonio M. Eugenio, Jr. of the Regional Trial Court of Manila, Branch 1, granted the application and issued Search Warrant. Armed with the search warrants, the NBI searched the premises and, in the course of the search, seized Unilever products.
The NBI thereafter filed with the Department of Justice (DOJ) a complaint against the respondent for violation of R.A. No. 8293, specifically Section 168 (unfair competition), in relation with Section 170.
In his counter-affidavit, the respondent claimed that he is engaged in the business of selling leather goods and raw materials for making leather products, and he conducts his business under the name “Probest International Trading,”; he is not engaged in the sale of counterfeit Unilever shampoo products; the sachets of Unilever shampoos seized from his office in Probest International Trading Building are genuine shampoo products which they use for Nnpersonal consumption.
Issue: WON respondent committed unfair competition
Held: The court found probable cause that the respondent committed unfair competition. A total of 1,238 assorted counterfeit Unilever products were found at, and seized from, the respondent’s office. The huge volume and the location where these shampoos were found (inside a box under a pile of other boxes located inside the respondent’s office) belie the respondent’s claim of personal consumption. Human experience and common sense dictate that shampoo products (intended for personal consumption) will ordinarily and logically be found inside the house, specifically, inside the bathroom or in a private room, not in the consumer’s office. the failure to prove that the respondent is the owner of the warehouse does not automatically free him from liability. Proof of the warehouse’s ownership is not crucial to the finding of probable cause. In fact, ownership of the establishment where the counterfeit products were found is not even an element of unfair competition. While the respondent may not be its owner, this does not foreclose the possibility that he was the manufacturer or distributor of the counterfeit shampoo products. The striking similarities between the genuine Unilever shampoo sachets and the counterfeit sachets seized by the NBI support the belief that the respondent had been engaged in dealing, manufacturing, selling and distributing counterfeit Unilever shampoo products.