CMT successfully represented Philippine Electricity Market Corporation (“PEMC”) as a petitioner in the case filed with the Securities and Exchange Commission (“SEC”) to cancel the corporate name of World Electricalmech System Management (WESM), Inc (“World Electricalmech”), or to order the latter to amend or modify its corporate name.

PEMC is a non-stock, non-profit domestic corporation, whose primary purpose is to “manage, govern and administer an efficient, competitive, transparent and reliable market for the wholesale and purchase of electricity and ancillary services in the Philippines (the Wholesale Electricity Spot Market or “WESM”). PEMC owns the trademark “WESM” and two other marks which incorporate the letters “WESM”.

Our lawyers filed a petition for cancellation of corporate name of World Electricalmech arguing that the corporate name of the latter is confusingly similar to Philippine Electricity Market Corporation’s trade name and registered mark WESM.

In its Decision dated 04 July 2017, the SEC granted the petition and directed World Electricalmech System Management (WESM), Inc. to change or modify its corporate name by deleting the word “WESM” and amending its Articles of Incorporation; otherwise, its Certificate of Registration shall be revoked.

The SEC restated the two requisites of a prohibited corporate name: first, that the complainant corporation acquired a prior right over the use of such corporate name; and second, that the proposed name is either: (a) identical or (b) deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law; or (c) patently deceptive, confusing or contrary to existing law.

As to the first requisite, the SEC noted that “[a]lthough [World Electricalmech] was the first to use WESM as part of its corporate name, WESM is already a registered trademark at that time.” As to the second requisite, the SEC said that “although the trademark WESM of [PEMC] and the complete corporate name of [World Electricalmech] is not identical, it may lead people to believe that [World Electricalmech] is the one who holds the trademark WESM. The evidence on record shows that WESM is used by [World Electricalmech] not merely as an abbreviation of its corporate name but as a unique identifier.” Hence, the SEC ruled that World Electricalmech’s corporate name falls within the prohibition of the law.

Finally, the SEC ruled that World Electricalmech must also be held to its undertaking with the SEC of “xxx its willingness to change its corporate name in the event [that] another … entity has acquired a prior right to use the said firm name or one deceptively or confusingly similar to it.”

Divina Gracia E. Pedron was the lead counsel in this case.

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