While not required in Philippine intellectual property (IP) litigation, market survey evidence may be used “to prove (a) the primary significance of a mark to the relevant public, including its distinctiveness, its descriptive or generic status, its strength or well-known status and/or (b) likelihood of confusion.”¹

In Ginebra San Miguel, Inc. v. Director of the Bureau of Trademarks, ² the Philippine Supreme Court, guided by the leading U.S. case of Zippo Mfg. Co. v. Rogers Imps., Inc, ³ justified the admissibility of market survey evidence (or its acceptability as proof) on two bases, i.e., necessity and trustworthiness.

Anent necessity, the Philippine Supreme Court declared, in Ginebra, that market survey evidence is important in establishing likelihood of confusion in trademark disputes, because market surveys allow an economical and systematic way of gathering data on numerous consumers about the likelihood of confusion. Therefore, market surveys enable courts to determine likelihood of confusion based on empirical facts, instead of the courts’ own assumptions on how consumers are likely to respond to certain marks. Later, in Lacoste S.A. v. Crocodile International Pte. Ltd., ⁴ the Philippine Supreme Court found that market survey evidence was necessary therein, because there was no other practical means of determining the existence of actual confusion, except by getting a representative sample of the consuming public and personally eliciting their perception of the contending marks, through a market survey conducted and analyzed in accordance with scientifically accepted procedure.

Anent trustworthiness, the Philippine Supreme Court declared, in Ginebra, that the probative value of market survey evidence (or its usefulness in proving or disproving a fact in question) depends on its reliability. Citing the Manual for Complex Litigation of the Federal Judicial Center, the Philippine Supreme Court declared that the reliability of market survey evidence depends, in turn, on the following factors:

1.the universe was properly defined;
2. a representative sample of that universe was selected;
3. the questions to be asked of interviewees were framed in a clear, precise, and non-leading manner;
4. sound interview procedures were followed by competent interviewers, who had no knowledge of the litigation or the purpose for which the survey was conducted;
5. the data gathered was accurately reported;
6. the data was analyzed in accordance with accepted statistical principles; and
7. objectivity of the entire process was assured. ⁵

An eighth factor -- “the sample and the interviews were conducted independently of the attorneys in the case” -- is cited in some U.S. cases. ⁶

In Ginebra, the Philippine Supreme Court found that the two market surveys presented by Ginebra San Miguel, Inc. were reliable because: (1) the universe where each sample was taken was defined (in one market survey for example, the universe was comprised of 6,203,643 gin drinkers from three geographical areas); (2) each sample was numerically relevant (there were 300 respondents in each market survey); (3) the market survey questions were framed in a clear, precise, and non-leading manner, and open-ended questions were posed to avoid bias; (4) the methodology (face-to-face interviews using standardized questionnaires in both market surveys, including an audio-visual presentation in one market survey) was adequately explained and developed from long years of experience by a reputable market research organization; (5) the data gathered were accurately reported and analyzed in accordance with acceptable statistical principles; (6) the individuals who administered the market surveys were unaware of the ongoing litigation; neither the client nor its attorneys had any participation in any aspect of the market surveys; and the market research firm was paid regardless of the results of the market surveys; and (7) an expert in market research testified on the market surveys during trial.

However, in Lacoste, the Philippine Supreme Court noted that the market survey evidence was unreliable because: (1) the universe, with a sample of 450 respondents, was not defined; (2) without the universe, it could not be determined if the sample was sufficiently large and numerically representative, and there was no showing that the sample was randomly selected following accepted scientific sampling procedures; and (3) while some questions were testified to by the expert witness, no list of all questions (or a copy of the questionnaire) was presented to show that they were asked in a non-leading manner.

In sum, market survey evidence may generally be considered in resolving Philippine IP disputes involving (1) the primary significance of a mark to the relevant public (including its distinctiveness, its descriptive or generic status, and its strength or well-known status) or (2) the likelihood of confusion. However, the probative value of market survey evidence depends largely on its reliability. Consequently, a party (relying on market survey evidence) must present an expert witness who must detail how the data was scientifically, accurately, and objectively collected and analyzed. Stated differently, such party must, in the words of the Philippine Supreme Court, show that “[t]he right questions [were] asked of the right number of people from the right population in the right manner and designed and analyzed by the right expert using the right methodology.” ⁷

If you want to read more on the legal concept of primary significance, please see this article: “The Primary Significance Test: How Public Perception Shapes the Distinctiveness of a Mark.”

Please Note: This article was prepared for informational purposes only. It is not a legal advice. And while it strives to be accurate and relevant, there is no guarantee that it will remain so in the future or when it is received. For legal advice on Philippine intellectual property (IP) law, please consult a licensed Philippine attorney.

We Can Help You: Zamora and Poblador provides legal services on Philippine IP law, including registration, opposition, cancellation, enforcement, prosecution, defense, contract preparation, contract review, due diligence, and portfolio management.

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• ¹1 Rule 18, Section 9, The 2020 Revised Rules of Procedure for Intellectual Property Rights Cases (A.M. No. 10-3-10-SC, 6 October 2020).
  ² G.R. Nos. 196372, 210224, 216104, and 219632, 9 August 2022.
  ³ 216 F. Supp. 670 (1963).
  ⁴ G.R. No. 223270, 6 November 2023.
  ⁵ McCarthy, Trademarks and Unfair Competition §32:53 (1973), 4 Louisell and Mueller, Federal Evidence §472 at 957 (1979); Manual for Complex Litigation, 116 (5th Ed. 1981); and 3 Gilson on Trademarks §8.03 (2020), citing Manual for Complex Litigation, Fourth (2004) §11.493.
  ⁶ G. Heileman Brewing Co. v. Anheuser-Busch, Inc., 873 F.2d 985 (7th Cir. 1989).
  ⁷ Ginebra San Miguel, Inc. v. Director of the Bureau of Trademarks, supra.