L.C. Big Mak Burger, Inc. v. McDonald’s Corporation

DOCTRINE: The judgment in the separate case of infringement and unfair competition cannot reverse nor modify the said SEC’s Decision for the use of corporate name.

FACTS: McDonald’s Corporation filed against L.C. Big Mak Burger, Inc. for trademark infringement and unfair competition in the RTC Makati (Infringement Court). The court ruled in favor of McDonald’s and directed the petitioner to refrain from using the name “Big Mak” or any other mark, word, name, or device, which by colorable imitation is likely to confuse, mislead or deceive the public into believing that the [petitioner’s] goods and services originate from, or are sponsored by or affiliated with those of [respondent’s], and from otherwise unfairly trading on the reputation and goodwill of the Mcdonald’s Marks, in particular the mark “BIG MAC”; selling, distributing, advertising, offering for sale or procuring to be sold, or otherwise disposing of any article described as or purporting to be manufactured by [respondent]; and directly or indirectly using any mark, or doing any set or thing, likely to induce the belief on the part of the public that [petitioner] and their products and services are in any way connected with [respondent’s] and their products and services; in such places within the jurisdiction of the National Capital Judicial Region. 

The CA overturned the decision but the SC reinstated the decision of the Infringement Court in 2004.

In 2008, respondent filed a Petition for Contempt against petitioner, averred therein that despite service upon the petitioner and its president of the Writ of Execution in the trademark infringement and unfair competition case, the latter continues to disobey and ignore their judgment obligation by continuously using, as part of their food and restaurant business, the words “Big Mak.” It was also alleged that petitioner refused to fully pay the damages awarded to the respondent in the said case. According to the petitioner, it offered and tendered payment to the respondent through the sheriff but respondent refused to accept the same and demanded that payment be made directly to it. Moreover, its stalls were using its company name “L.C. Big Mak Burger, Inc.” and changed the name of some of its stalls and products to “Supermak”. The RTC Makati ruled in favor of the petitioner but the CA reversed the RTC’s decision.

ISSUE: Whether or not the petitioner can use its corporate name

HELD: It bears stressing that the proscription in the injunction order is against petitioner’s use of the mark “Big Mak.” However, as established, petitioner had already been using its corporate name instead of the proscribed mark. The use of petitioner’s corporate name instead of the words “Big Mak” solely was evidently pursuant to the directive of the court in the injunction order. Clearly, as correctly found by the RTC, petitioner had indeed desisted from the use of “Big Mak” to comply with the injunction order.

In the SEC’s decision in McDonald’s Corporation and McGeorge Food Industries, Inc. v. L.C. Big Mak Burger, Inc., et al., the SEC dismissed respondent’s case, ruling that petitioner’s use of the name “Big Mak Burger” has priority in right; and that petitioner’s corporate name is not identical or confusingly similar to respondent’s “Big Mac” mark, hence, there is no basis to cancel petitioner’s corporate name, among others. 

Notably, it was a patent error on the part of the CA to rule that the said SEC’s Decision was binding upon the parties until this Court issued its final and executory 2004 Decision giving the impression that the latter Decision overturned or modified SEC’s final and executory Decision. 

To be sure, the complaint for change of corporate name before the SEC is a separate and distinct case from that of the infringement and unfair competition case before the trial court. Hence, inasmuch as the SEC’s Decision had long attained finality, the judgment in the separate case of infringement and unfair competition cannot reverse nor modify the said SEC’s Decision. 

This Court finds no reason to reject petitioner’s explanation or doubt its good faith as certainly, the use of its corporate name was warranted by the SEC’s Decision. It was also not unreasonable for the petitioner, through its officers, to think that the stalls and products bearing its corporate name would send the message to the public that the products were the petitioner’s and not those of respondent’s, the very evil sought to be prevented and/or eradicated by the decision in the infringement/unfair competition case.