Orient Ship Management Philippines, Inc. v. OSM Shipping Philippines, Inc.

[SEC-SICD * CASE NO. 07-96-5388. August 12, 1999.] ORIENT SHIP MANAGEMENT PHILIPPINES, INC. , petitioner , vs .OSM SHIPPING PHILIPPINES, INC. RAFAEL C. DINO and ALEXANDER ABILO , respondents . D E C I S I O N Who has the prior right to use the name "OSM",respondent OSM Shipping Philippines, Inc. or petitioner Orient Ship Management Philippines, Inc.? This, in a nutshell, is the main cause of action in this case which this Commission is tasked to resolved. This is a petition brought about by petitioner for violation of Section 18 of the Corporation Code, which provides: "SECTION 18. Corporate Name . 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, confusing, or contrary to existing laws. When a change in the corporate name is approved, the Commission shall issue an amended certificate of incorporation under the amended name." LLphil Respondents, formerly El Shaddai Shipping, Inc. applied for a change of corporate name from "El Shaddai Shipping, Inc." to "OSM Shipping Phil.,Inc." as far back as October 05, 1990. On the other hand, petitioner, formerly "Arendal Ship Management, Inc." filed and was approved to change its corporate name to "Orient Ship Management Philippines, Inc. only on October 28, 1993. The two companies being engaged in the same line of business of "manning and crewing",there arose confusion resulting to alleged losses by either party ,as a result of their names being confusingly similar to each other. Both parties now seek to eliminate the other and seek damages by way of actual, exemplary and attorney's fees, plus cost of this suit. After a careful evaluation of the parties' allegations, we find for the respondents. Jurisprudence in this regard is given in Philips Export BV vs. Court of Appeals, G.R. No. 96161, February 21, 1992, which gives the test, to wit: "In determining the existence of confusing similarity in corporate name, the test is whether the similarity is such as to mislead a person using ordinary care and discrimination. In so doing, the court must look to the records as well as the names themselves. ..." As to who among the parties acquired prior right over the name "OSM",there is no dispute that respondent corporation acquired its use ahead of petitioner. It is of judicial notice that when a corporation is applying for registration, it is required to spell out the full name of the word written with its initials only. In this case, "OSM" really stands for "Orient Ship Management" which was then, a principal of respondent corporation. This Office finds that there arose a situation when the corporate name of petitioner and that of respondents are strikingly identical and deceptively or confusingly similar when petitioner uses the acronym "OSM" instead of the full name. Respondents Exhibits "4" and "5" clearly tell it all. Petitioner ORIENT SHIP MANAGEMENT PHILIPPINES, INC. continues to use the acronym "OSM" in its press releases and advertisements, thereby creating confusion to the foreign principals of both parties and to the public. For this purpose, one has to desist or to be restrained from using the word "OSM",otherwise, one has to continue to suffer damages which is unavoidable in the circumstances. The law is very clear and needs no further explanation. He who is registered first, is to have the upper hand, hence it is respondents OSM SHIPPING PHILIPPINES, INC.,who obtained prior registration with this Commission although both their names at present are not their original names which comes only after the Amendment of their Articles of Incorporation. WHEREFORE, premises considered, judgment is hereby rendered DISMISSING the petition against the Respondents. Corollary thereto, petitioner corporation is hereby ordered to desist/refrain from using the acronym "OSM" and is further directed to change its corporate name to another name not confusingly or deceptively similar to respondents name within thirty (30) days from finality of this Order. Attorney's fees and cost of litigation shall be borne by both parties. SO ORDERED. (SGD.) JULIETO F. FABRERO Hearing Officer