Republic of the Philippines

SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 148222 August 15, 2003
PEARL & DEAN (PHIL.), INCORPORATED, Petitioner,
vs.
SHOEMART, INCORPORATED, and NORTH EDSA MARKETING,
INCORPORATED, Respondents.
D E C I S I O N
CORONA, J.:
In the instant petition for review on certiorari under Rule 45 of the Rules
of Court, petitioner Pearl & Dean (Phil.) Inc. (P & D) assails the May 22,
2001 decision1 of the Court of Appeals reversing the October 31, 1996
decision2 of the Regional Trial Court of Makati, Branch 133, in Civil Case
No. 92-516 which declared private respondents Shoemart Inc. (SMI) and
North Edsa Marketing Inc. (NEMI) liable for infringement of trademark
and copyright, and unfair competition.
FACTUAL ANTECEDENTS
The May 22, 2001 decision of the Court of Appeals3 contained a
summary of this dispute:
"Plaintif-appellant Pearl and Dean (Phil.), Inc. is a corporation engaged
in the manufacture of advertising display units simply referred to as light
boxes. These units utilize specially printed posters sandwiched between
plastic sheets and illuminated with back lights. Pearl and Dean was able
to secure a Certifcate of Copyright Registration dated January 20, 1981
over these illuminated display units. The advertising light boxes were
marketed under the trademark "Poster Ads". The application for
registration of the trademark was fled with the Bureau of Patents,
Trademarks and Technology Transfer on June 20, 1983, but was
1
approved only on September 12, 1988, per Registration No. 41165. From
1981 to about 1988, Pearl and Dean employed the services of Metro
Industrial Services to manufacture its advertising displays.
Sometime in 1985, Pearl and Dean negotiated with defendant-appellant
Shoemart, Inc. (SMI) for the lease and installation of the light boxes in
SM City North Edsa. Since SM City North Edsa was under construction
at that time, SMI ofered as an alternative, SM Makati and SM Cubao, to
which Pearl and Dean agreed. On September 11, 1985, Pearl and Deans
General Manager, Rodolfo Vergara, submitted for signature the contracts
covering SM Cubao and SM Makati to SMIs Advertising Promotions and
Publicity Division Manager, Ramonlito Abano. Only the contract for SM
Makati, however, was returned signed. On October 4, 1985, Vergara
wrote Abano inquiring about the other contract and reminding him that
their agreement for installation of light boxes was not only for its SM
Makati branch, but also for SM Cubao. SMI did not bother to reply.
Instead, in a letter dated January 14, 1986, SMIs house counsel
informed Pearl and Dean that it was rescinding the contract for SM
Makati due to non-performance of the terms thereof. In his reply dated
February 17, 1986, Vergara protested the unilateral action of SMI, saying
it was without basis. In the same letter, he pushed for the signing of the
contract for SM Cubao.
Two years later, Metro Industrial Services, the company formerly
contracted by Pearl and Dean to fabricate its display units, ofered to
construct light boxes for Shoemarts chain of stores. SMI approved the
proposal and ten (10) light boxes were subsequently fabricated by Metro
Industrial for SMI. After its contract with Metro Industrial was
terminated, SMI engaged the services of EYD Rainbow Advertising
Corporation to make the light boxes. Some 300 units were fabricated in
1991. These were delivered on a staggered basis and installed at SM
Megamall and SM City.
Sometime in 1989, Pearl and Dean, received reports that exact copies of
its light boxes were installed at SM City and in the fastfood section of SM
Cubao. Upon investigation, Pearl and Dean found out that aside from the
two (2) reported SM branches, light boxes similar to those it
manufactures were also installed in two (2) other SM stores. It further
discovered that defendant-appellant North Edsa Marketing Inc. (NEMI),
2
through its marketing arm, Prime Spots Marketing Services, was set up
primarily to sell advertising space in lighted display units located in
SMIs diferent branches. Pearl and Dean noted that NEMI is a sister
company of SMI.
In the light of its discoveries, Pearl and Dean sent a letter dated
December 11, 1991 to both SMI and NEMI enjoining them to cease using
the subject light boxes and to remove the same from SMIs
establishments. It also demanded the discontinued use of the trademark
"Poster Ads," and the payment to Pearl and Dean of compensatory
damages in the amount of Twenty Million Pesos (P20,000,000.00).
Upon receipt of the demand letter, SMI suspended the leasing of two
hundred twenty-four (224) light boxes and NEMI took down its
advertisements for "Poster Ads" from the lighted display units in SMIs
stores. Claiming that both SMI and NEMI failed to meet all its demands,
Pearl and Dean fled this instant case for infringement of trademark and
copyright, unfair competition and damages.
In denying the charges hurled against it, SMI maintained that it
independently developed its poster panels using commonly known
techniques and available technology, without notice of or reference to
Pearl and Deans copyright. SMI noted that the registration of the mark
"Poster Ads" was only for stationeries such as letterheads, envelopes, and
the like. Besides, according to SMI, the word "Poster Ads" is a generic
term which cannot be appropriated as a trademark, and, as such,
registration of such mark is invalid. It also stressed that Pearl and Dean
is not entitled to the reliefs prayed for in its complaint since its
advertising display units contained no copyright notice, in violation of
Section 27 of P.D. 49. SMI alleged that Pearl and Dean had no cause of
action against it and that the suit was purely intended to malign SMIs
good name. On this basis, SMI, aside from praying for the dismissal of
the case, also counterclaimed for moral, actual and exemplary damages
and for the cancellation of Pearl and Deans Certifcation of Copyright
Registration No. PD-R-2558 dated January 20, 1981 and Certifcate of
Trademark Registration No. 4165 dated September 12, 1988.
NEMI, for its part, denied having manufactured, installed or used any
advertising display units, nor having engaged in the business of
3
advertising. It repleaded SMIs averments, admissions and denials and
prayed for similar reliefs and counterclaims as SMI."
The RTC of Makati City decided in favor of P & D:
Wherefore, defendants SMI and NEMI are found jointly and severally
liable for infringement of copyright under Section 2 of PD 49, as
amended, and infringement of trademark under Section 22 of RA No.
166, as amended, and are hereby penalized under Section 28 of PD 49,
as amended, and Sections 23 and 24 of RA 166, as amended.
Accordingly, defendants are hereby directed:
(1) to pay plaintif the following damages:
(a) actual damages - P16,600,000.00,
representing profts
derived by defendants
as a result of infringe-
ment of plaintifs copyright
from 1991 to 1992
(b) moral damages - P1,000.000.00
(c) exemplary damages - P1,000,000.00
(d) attorneys fees - P1,000,000.00
plus
(e) costs of suit;
(2) to deliver, under oath, for impounding in the National Library, all light
boxes of SMI which were fabricated by Metro Industrial Services and EYD
Rainbow Advertising Corporation;
(3) to deliver, under oath, to the National Library, all fller-posters using
the trademark "Poster Ads", for destruction; and
(4) to permanently refrain from infringing the copyright on plaintifs light
boxes and its trademark "Poster Ads".
4
Defendants counterclaims are hereby ordered dismissed for lack of
merit.
SO ORDERED.4
On appeal, however, the Court of Appeals reversed the trial court:
Since the light boxes cannot, by any stretch of the imagination, be
considered as either prints, pictorial illustrations, advertising copies,
labels, tags or box wraps, to be properly classifed as a copyrightable
class "O" work, we have to agree with SMI when it posited that what was
copyrighted were the technical drawings only, and not the light boxes
themselves, thus:
42. When a drawing is technical and depicts a utilitarian object, a
copyright over the drawings like plaintif-appellants will not extend to the
actual object. It has so been held under jurisprudence, of which the
leading case is Baker vs. Selden (101 U.S. 841 (1879). In that case,
Selden had obtained a copyright protection for a book entitled "Seldens
Condensed Ledger or Bookkeeping Simplifed" which purported to explain
a new system of bookkeeping. Included as part of the book were blank
forms and illustrations consisting of ruled lines and headings, specially
designed for use in connection with the system explained in the work.
These forms showed the entire operation of a day or a week or a month
on a single page, or on two pages following each other. The defendant
Baker then produced forms which were similar to the forms illustrated in
Seldens copyrighted books. The Court held that exclusivity to the actual
forms is not extended by a copyright. The reason was that "to grant a
monopoly in the underlying art when no examination of its novelty has
ever been made would be a surprise and a fraud upon the public; that is
the province of letters patent, not of copyright." And that is precisely the
point. No doubt aware that its alleged original design would never pass
the rigorous examination of a patent application, plaintif-appellant
fought to foist a fraudulent monopoly on the public by conveniently
resorting to a copyright registration which merely employs a recordal
system without the beneft of an in-depth examination of novelty.
The principle in Baker vs. Selden was likewise applied in Muller vs.
Triborough Bridge Authority [43 F. Supp. 298 (S.D.N.Y. 1942)]. In this
5
case, Muller had obtained a copyright over an unpublished drawing
entitled "Bridge Approach the drawing showed a novel bridge approach
to unsnarl trafc congestion". The defendant constructed a bridge
approach which was alleged to be an infringement of the new design
illustrated in plaintifs drawings. In this case it was held that protection
of the drawing does not extend to the unauthorized duplication of the
object drawn because copyright extends only to the description or
expression of the object and not to the object itself. It does not prevent
one from using the drawings to construct the object portrayed in the
drawing.
In two other cases, Imperial Homes Corp. v. Lamont, 458 F. 2d 895 and
Scholtz Homes, Inc. v. Maddox, 379 F. 2d 84, it was held that there is no
copyright infringement when one who, without being authorized, uses a
copyrighted architectural plan to construct a structure. This is because
the copyright does not extend to the structures themselves.
In fne, we cannot fnd SMI liable for infringing Pearl and Deans
copyright over the technical drawings of the latters advertising display
units.
xxx xxx xxx
The Supreme Court trenchantly held in Faberge, Incorporated vs.
Intermediate Appellate Court that the protective mantle of the Trademark
Law extends only to the goods used by the frst user as specifed in the
certifcate of registration, following the clear mandate conveyed by
Section 20 of Republic Act 166, as amended, otherwise known as the
Trademark Law, which reads:
SEC. 20. Certifcation of registration prima facie evidence of validity.- A
certifcate of registration of a mark or trade-name shall be prima facie
evidence of the validity of the registration, the registrants ownership of
the mark or trade-name, and of the registrants exclusive right to use the
same in connection with the goods, business or services specifed in the
certifcate, subject to any conditions and limitations stated therein."
(underscoring supplied)
The records show that on June 20, 1983, Pearl and Dean applied for the
registration of the trademark "Poster Ads" with the Bureau of Patents,
6
Trademarks, and Technology Transfer. Said trademark was recorded in
the Principal Register on September 12, 1988 under Registration No.
41165 covering the following products: stationeries such as letterheads,
envelopes and calling cards and newsletters.
With this as factual backdrop, we see no legal basis to the fnding of
liability on the part of the defendants-appellants for their use of the
words "Poster Ads", in the advertising display units in suit.
Jurisprudence has interpreted Section 20 of the Trademark Law as "an
implicit permission to a manufacturer to venture into the production of
goods and allow that producer to appropriate the brand name of the
senior registrant on goods other than those stated in the certifcate of
registration." The Supreme Court further emphasized the restrictive
meaning of Section 20 when it stated, through Justice Conrado V.
Sanchez, that:
Really, if the certifcate of registration were to be deemed as including
goods not specifed therein, then a situation may arise whereby an
applicant may be tempted to register a trademark on any and all goods
which his mind may conceive even if he had never intended to use the
trademark for the said goods. We believe that such omnibus registration
is not contemplated by our Trademark Law.
While we do not discount the striking similarity between Pearl and
Deans registered trademark and defendants-appellants "Poster Ads"
design, as well as the parallel use by which said words were used in the
parties respective advertising copies, we cannot fnd defendants-
appellants liable for infringement of trademark. "Poster Ads" was
registered by Pearl and Dean for specifc use in its stationeries, in
contrast to defendants-appellants who used the same words in their
advertising display units. Why Pearl and Dean limited the use of its
trademark to stationeries is simply beyond us. But, having already done
so, it must stand by the consequence of the registration which it had
caused.
xxx xxx xxx
We are constrained to adopt the view of defendants-appellants that the
words "Poster Ads" are a simple contraction of the generic term poster
advertising. In the absence of any convincing proof that "Poster Ads" has
7
acquired a secondary meaning in this jurisdiction, we fnd that Pearl and
Deans exclusive right to the use of "Poster Ads" is limited to what is
written in its certifcate of registration, namely, stationeries.
Defendants-appellants cannot thus be held liable for infringement of the
trademark "Poster Ads".
There being no fnding of either copyright or trademark infringement on
the part of SMI and NEMI, the monetary award granted by the lower
court to Pearl and Dean has no leg to stand on.
xxx xxx xxx
WHEREFORE, premises considered, the assailed decision is REVERSED
and SET ASIDE, and another is rendered DISMISSING the complaint and
counterclaims in the above-entitled case for lack of merit.5
Dissatisfed with the above decision, petitioner P & D fled the instant
petition assigning the following errors for the Courts consideration:
A. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT NO
COPYRIGHT INFRINGEMENT WAS COMMITTED BY RESPONDENTS SM
AND NEMI;
B. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT NO
INFRINGEMENT OF PEARL & DEANS TRADEMARK "POSTER ADS" WAS
COMMITTED BY RESPONDENTS SM AND NEMI;
C. THE HONORABLE COURT OF APPEALS ERRED IN DISMISSING THE
AWARD OF THE TRIAL COURT, DESPITE THE LATTERS FINDING, NOT
DISPUTED BY THE HONORABLE COURT OF APPEALS, THAT SM WAS
GUILTY OF BAD FAITH IN ITS NEGOTIATION OF ADVERTISING
CONTRACTS WITH PEARL & DEAN.
D. THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING
RESPONDENTS SM AND NEMI LIABLE TO PEARL & DEAN FOR
ACTUAL, MORAL & EXEMPLARY DAMAGES, ATTORNEYS FEES AND
COSTS OF SUIT.6
ISSUES
8
In resolving this very interesting case, we are challenged once again to
put into proper perspective four main concerns of intellectual property
law patents, copyrights, trademarks and unfair competition arising
from infringement of any of the frst three. We shall focus then on the
following issues:
(1) if the engineering or technical drawings of an advertising display unit
(light box) are granted copyright protection (copyright certifcate of
registration) by the National Library, is the light box depicted in such
engineering drawings ipso facto also protected by such copyright?
(2) or should the light box be registered separately and protected by a
patent issued by the Bureau of Patents Trademarks and Technology
Transfer (now Intellectual Property Ofce) in addition to the copyright
of the engineering drawings?
(3) can the owner of a registered trademark legally prevent others from
using such trademark if it is a mere abbreviation of a term descriptive of
his goods, services or business?
ON THE ISSUE OF COPYRIGHT INFRINGEMENT
Petitioner P & Ds complaint was that SMI infringed on its copyright over
the light boxes when SMI had the units manufactured by Metro and EYD
Rainbow Advertising for its own account. Obviously, petitioners position
was premised on its belief that its copyright over the engineering
drawings extended ipso facto to the light boxes depicted or illustrated in
said drawings. In ruling that there was no copyright infringement, the
Court of Appeals held that the copyright was limited to the drawings
alone and not to the light box itself. We agree with the appellate court.
First, petitioners application for a copyright certifcate as well as
Copyright Certifcate No. PD-R2588 issued by the National Library on
January 20, 1981 clearly stated that it was for a class "O" work under
Section 2 (O) of PD 49 (The Intellectual Property Decree) which was the
statute then prevailing. Said Section 2 expressly enumerated the works
subject to copyright:
9
SEC. 2. The rights granted by this Decree shall, from the moment of
creation, subsist with respect to any of the following works:
x x x x x x x x x
(O) Prints, pictorial illustrations, advertising copies, labels, tags, and box
wraps;
x x x x x x x x x
Although petitioners copyright certifcate was entitled "Advertising
Display Units" (which depicted the box-type electrical devices), its claim
of copyright infringement cannot be sustained.
Copyright, in the strict sense of the term, is purely a statutory right.
Being a mere statutory grant, the rights are limited to what the statute
confers. It may be obtained and enjoyed only with respect to the subjects
and by the persons, and on terms and conditions specifed in the
statute.7 Accordingly, it can cover only the works falling within the
statutory enumeration or description.8
P & D secured its copyright under the classifcation class "O" work. This
being so, petitioners copyright protection extended only to the technical
drawings and not to the light box itself because the latter was not at all
in the category of "prints, pictorial illustrations, advertising copies,
labels, tags and box wraps." Stated otherwise, even as we fnd that P & D
indeed owned a valid copyright, the same could have referred only to the
technical drawings within the category of "pictorial illustrations." It could
not have possibly stretched out to include the underlying light box. The
strict application9 of the laws enumeration in Section 2 prevents us from
giving petitioner even a little leeway, that is, even if its copyright
certifcate was entitled "Advertising Display Units." What the law does not
include, it excludes, and for the good reason: the light box was not a
literary or artistic piece which could be copyrighted under the copyright
law. And no less clearly, neither could the lack of statutory authority to
make the light box copyrightable be remedied by the simplistic act of
entitling the copyright certifcate issued by the National Library as
"Advertising Display Units."
10
In fne, if SMI and NEMI reprinted P & Ds technical drawings for sale to
the public without license from P & D, then no doubt they would have
been guilty of copyright infringement. But this was not the case. SMIs
and NEMIs acts complained of by P & D were to have units similar or
identical to the light box illustrated in the technical drawings
manufactured by Metro and EYD Rainbow Advertising, for leasing out to
diferent advertisers. Was this an infringement of petitioners copyright
over the technical drawings? We do not think so.
During the trial, the president of P & D himself admitted that the light
box was neither a literary not an artistic work but an "engineering or
marketing invention."10 Obviously, there appeared to be some confusion
regarding what ought or ought not to be the proper subjects of
copyrights, patents and trademarks. In the leading case of Kho vs. Court
of Appeals,11 we ruled that these three legal rights are completely
distinct and separate from one another, and the protection aforded by
one cannot be used interchangeably to cover items or works that
exclusively pertain to the others:
Trademark, copyright and patents are diferent intellectual property
rights that cannot be interchanged with one another. A trademark is any
visible sign capable of distinguishing the goods (trademark) or services
(service mark) of an enterprise and shall include a stamped or marked
container of goods. In relation thereto, a trade name means the name or
designation identifying or distinguishing an enterprise. Meanwhile, the
scope of a copyright is confned to literary and artistic works which are
original intellectual creations in the literary and artistic domain
protected from the moment of their creation. Patentable inventions, on
the other hand, refer to any technical solution of a problem in any feld of
human activity which is new, involves an inventive step and is
industrially applicable.
ON THE ISSUE OF PATENT INFRINGEMENT
This brings us to the next point: if, despite its manufacture and
commercial use of the light boxes without license from petitioner, private
respondents cannot be held legally liable for infringement of P & Ds
copyright over its technical drawings of the said light boxes, should they
be liable instead for infringement of patent? We do not think so either.
11
For some reason or another, petitioner never secured a patent for the
light boxes. It therefore acquired no patent rights which could have
protected its invention, if in fact it really was. And because it had no
patent, petitioner could not legally prevent anyone from manufacturing or
commercially using the contraption. In Creser Precision Systems, Inc. vs.
Court of Appeals,12 we held that "there can be no infringement of a
patent until a patent has been issued, since whatever right one has to
the invention covered by the patent arises alone from the grant of patent.
x x x (A)n inventor has no common law right to a monopoly of his
invention. He has the right to make use of and vend his invention, but if
he voluntarily discloses it, such as by ofering it for sale, the world is free
to copy and use it with impunity. A patent, however, gives the inventor
the right to exclude all others. As a patentee, he has the exclusive right
of making, selling or using the invention.13 On the assumption that
petitioners advertising units were patentable inventions, petitioner
revealed them fully to the public by submitting the engineering drawings
thereof to the National Library.
To be able to efectively and legally preclude others from copying and
profting from the invention, a patent is a primordial requirement. No
patent, no protection. The ultimate goal of a patent system is to bring
new designs and technologies into the public domain through
disclosure.14 Ideas, once disclosed to the public without the protection
of a valid patent, are subject to appropriation without signifcant
restraint.15
On one side of the coin is the public which will beneft from new ideas;
on the other are the inventors who must be protected. As held in Bauer &
Cie vs. ODonnel,16 "The act secured to the inventor the exclusive right
to make use, and vend the thing patented, and consequently to prevent
others from exercising like privileges without the consent of the patentee.
It was passed for the purpose of encouraging useful invention and
promoting new and useful inventions by the protection and stimulation
given to inventive genius, and was intended to secure to the public, after
the lapse of the exclusive privileges granted the beneft of such
inventions and improvements."
The law attempts to strike an ideal balance between the two interests:
12
"(The p)atent system thus embodies a carefully crafted bargain for
encouraging the creation and disclosure of new useful and non-obvious
advances in technology and design, in return for the exclusive right to
practice the invention for a number of years. The inventor may keep his
invention secret and reap its fruits indefnitely. In consideration of its
disclosure and the consequent beneft to the community, the patent is
granted. An exclusive enjoyment is guaranteed him for 17 years, but
upon the expiration of that period, the knowledge of the invention inures
to the people, who are thus enabled to practice it and proft by its
use."17
The patent law has a three-fold purpose: "frst, patent law seeks to foster
and reward invention; second, it promotes disclosures of inventions to
stimulate further innovation and to permit the public to practice the
invention once the patent expires; third, the stringent requirements for
patent protection seek to ensure that ideas in the public domain remain
there for the free use of the public."18
It is only after an exhaustive examination by the patent ofce that a
patent is issued. Such an in-depth investigation is required because "in
rewarding a useful invention, the rights and welfare of the community
must be fairly dealt with and efectively guarded. To that end, the
prerequisites to obtaining a patent are strictly observed and when a
patent is issued, the limitations on its exercise are equally strictly
enforced. To begin with, a genuine invention or discovery must be
demonstrated lest in the constant demand for new appliances, the heavy
hand of tribute be laid on each slight technological advance in art."19
There is no such scrutiny in the case of copyrights nor any notice
published before its grant to the efect that a person is claiming the
creation of a work. The law confers the copyright from the moment of
creation20 and the copyright certifcate is issued upon registration with
the National Library of a sworn ex-parte claim of creation.
Therefore, not having gone through the arduous examination for patents,
the petitioner cannot exclude others from the manufacture, sale or
commercial use of the light boxes on the sole basis of its copyright
certifcate over the technical drawings.
13
Stated otherwise, what petitioner seeks is exclusivity without any
opportunity for the patent ofce (IPO) to scrutinize the light boxs
eligibility as a patentable invention. The irony here is that, had petitioner
secured a patent instead, its exclusivity would have been for 17 years
only. But through the simplifed procedure of copyright-registration with
the National Library without undergoing the rigor of defending the
patentability of its invention before the IPO and the public the
petitioner would be protected for 50 years. This situation could not have
been the intention of the law.
In the oft-cited case of Baker vs. Selden21, the United States Supreme
Court held that only the expression of an idea is protected by copyright,
not the idea itself. In that case, the plaintif held the copyright of a book
which expounded on a new accounting system he had developed. The
publication illustrated blank forms of ledgers utilized in such a system.
The defendant reproduced forms similar to those illustrated in the
plaintifs copyrighted book. The US Supreme Court ruled that:
"There is no doubt that a work on the subject of book-keeping, though
only explanatory of well known systems, may be the subject of a
copyright; but, then, it is claimed only as a book. x x x. But there is a
clear distinction between the books, as such, and the art, which it is,
intended to illustrate. The mere statement of the proposition is so evident
that it requires hardly any argument to support it. The same distinction
may be predicated of every other art as well as that of bookkeeping. A
treatise on the composition and use of medicines, be they old or new; on
the construction and use of ploughs or watches or churns; or on the
mixture and application of colors for painting or dyeing; or on the mode
of drawing lines to produce the efect of perspective, would be the subject
of copyright; but no one would contend that the copyright of the treatise
would give the exclusive right to the art or manufacture described
therein. The copyright of the book, if not pirated from other works, would
be valid without regard to the novelty or want of novelty of its subject
matter. The novelty of the art or thing described or explained has nothing
to do with the validity of the copyright. To give to the author of the book
an exclusive property in the art described therein, when no examination
of its novelty has ever been ofcially made, would be a surprise and a
fraud upon the public. That is the province of letters patent, not of
copyright. The claim to an invention of discovery of an art or
manufacture must be subjected to the examination of the Patent Ofce
14
before an exclusive right therein can be obtained; and a patent from the
government can only secure it.
The diference between the two things, letters patent and copyright, may
be illustrated by reference to the subjects just enumerated. Take the case
of medicines. Certain mixtures are found to be of great value in the
healing art. If the discoverer writes and publishes a book on the subject
(as regular physicians generally do), he gains no exclusive right to the
manufacture and sale of the medicine; he gives that to the public. If he
desires to acquire such exclusive right, he must obtain a patent for the
mixture as a new art, manufacture or composition of matter. He may
copyright his book, if he pleases; but that only secures to him the
exclusive right of printing and publishing his book. So of all other
inventions or discoveries.
The copyright of a book on perspective, no matter how many drawings
and illustrations it may contain, gives no exclusive right to the modes of
drawing described, though they may never have been known or used
before. By publishing the book without getting a patent for the art, the
latter is given to the public.
x x x
Now, whilst no one has a right to print or publish his book, or any
material part thereof, as a book intended to convey instruction in the art,
any person may practice and use the art itself which he has described
and illustrated therein. The use of the art is a totally diferent thing from
a publication of the book explaining it. The copyright of a book on
bookkeeping cannot secure the exclusive right to make, sell and use
account books prepared upon the plan set forth in such book. Whether
the art might or might not have been patented, is a question, which is
not before us. It was not patented, and is open and free to the use of the
public. And, of course, in using the art, the ruled lines and headings of
accounts must necessarily be used as incident to it.
The plausibility of the claim put forward by the complainant in this case
arises from a confusion of ideas produced by the peculiar nature of the
art described in the books, which have been made the subject of
copyright. In describing the art, the illustrations and diagrams employed
happened to correspond more closely than usual with the actual work
15
performed by the operator who uses the art. x x x The description of the
art in a book, though entitled to the beneft of copyright, lays no
foundation for an exclusive claim to the art itself. The object of the one is
explanation; the object of the other is use. The former may be secured by
copyright. The latter can only be secured, if it can be secured at all, by
letters patent." (underscoring supplied)
ON THE ISSUE OF TRADEMARK INFRINGEMENT
This issue concerns the use by respondents of the mark "Poster Ads"
which petitioners president said was a contraction of "poster
advertising." P & D was able to secure a trademark certifcate for it, but
one where the goods specifed were "stationeries such as letterheads,
envelopes, calling cards and newsletters."22 Petitioner admitted it did not
commercially engage in or market these goods. On the contrary, it dealt
in electrically operated backlit advertising units and the sale of
advertising spaces thereon, which, however, were not at all specifed in
the trademark certifcate.
Under the circumstances, the Court of Appeals correctly cited Faberge
Inc. vs. Intermediate Appellate Court,23 where we, invoking Section 20 of
the old Trademark Law, ruled that "the certifcate of registration issued
by the Director of Patents can confer (upon petitioner) the exclusive right
to use its own symbol only to those goods specifed in the certifcate,
subject to any conditions and limitations specifed in the certifcate x x x.
One who has adopted and used a trademark on his goods does not
prevent the adoption and use of the same trademark by others for
products which are of a diferent description."24 Faberge, Inc. was
correct and was in fact recently reiterated in Canon Kabushiki Kaisha vs.
Court of Appeals.25
Assuming arguendo that "Poster Ads" could validly qualify as a
trademark, the failure of P & D to secure a trademark registration for
specifc use on the light boxes meant that there could not have been any
trademark infringement since registration was an essential element
thereof.1wphi1
ON THE ISSUE OF UNFAIR COMPETITION
16
If at all, the cause of action should have been for unfair competition, a
situation which was possible even if P & D had no registration.26
However, while the petitioners complaint in the RTC also cited unfair
competition, the trial court did not fnd private respondents liable
therefor. Petitioner did not appeal this particular point; hence, it cannot
now revive its claim of unfair competition.
But even disregarding procedural issues, we nevertheless cannot hold
respondents guilty of unfair competition.
By the nature of things, there can be no unfair competition under the law
on copyrights although it is applicable to disputes over the use of
trademarks. Even a name or phrase incapable of appropriation as a
trademark or tradename may, by long and exclusive use by a business
(such that the name or phrase becomes associated with the business or
product in the mind of the purchasing public), be entitled to protection
against unfair competition.27 In this case, there was no evidence that P
& Ds use of "Poster Ads" was distinctive or well-known. As noted by the
Court of Appeals, petitioners expert witnesses himself had testifed that "
Poster Ads was too generic a name. So it was difcult to identify it with
any company, honestly speaking."28 This crucial admission by its own
expert witness that "Poster Ads" could not be associated with P & D
showed that, in the mind of the public, the goods and services carrying
the trademark "Poster Ads" could not be distinguished from the goods
and services of other entities.
This fact also prevented the application of the doctrine of secondary
meaning. "Poster Ads" was generic and incapable of being used as a
trademark because it was used in the feld of poster advertising, the very
business engaged in by petitioner. "Secondary meaning" means that a
word or phrase originally incapable of exclusive appropriation with
reference to an article in the market (because it is geographically or
otherwise descriptive) might nevertheless have been used for so long and
so exclusively by one producer with reference to his article that, in the
trade and to that branch of the purchasing public, the word or phrase
has come to mean that the article was his property.29 The admission by
petitioners own expert witness that he himself could not associate
"Poster Ads" with petitioner P & D because it was "too generic" defnitely
precluded the application of this exception.
17
Having discussed the most important and critical issues, we see no need
to belabor the rest.
All told, the Court fnds no reversible error committed by the Court of
Appeals when it reversed the Regional Trial Court of Makati City.
WHEREFORE, the petition is hereby DENIED and the decision of the
Court of Appeals dated May 22, 2001 is AFFIRMED in toto.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. L-45101 November 28, 1986
ROSARIO C. MAGUAN (formerly ROSARIO C. TAN), petitioner,
vs.
THE HONORABLE COURT OF APPEALS and SUSANA LUCHAN,
respondents.
Ambrosio Padilla Law Ofces for petitioner.
PARAS, J.:p
Submitted on December 9, 1977 for Our decision is this petition for
review on certiorari of the two Resolutions of the Court of Appeals, the
frst dated July 6, 1976, setting aside its Decision of February 16, 1976
in CA-G.R. No. SP-04706, titled "SUSANA LUCHAN v. Hon. HONRADO, et
al." wherein it ruled for the dismissal of the petition for lack of merit and
at the same time nullifying the writ of preliminary injunction it had
previously issued; and the second, dated November 4, 1976, denying the
motion for reconsideration of the frst resolution above-mentioned.
18
Petitioner is doing business under the frm name and style of SWAN
MANUFACTURING" while private respondent is likewise doing business
under the frm name and style of "SUSANA LUCHAN POWDER PUFF
MANUFACTURING."
It is undisputed that petitioner is a patent holder of powder puf namely:
1. UM-423 (extended and/or renewed under Extension No. UM-109
for a period of 5 years from October 6, 1971)
2. UM-450 (extended and/or renewed under Extension No. UM110 for
a period of 5 years from January 26, 1972)
3. UM 1184, for a period of 5years fromApril 5, 1974.(Petition, Rollo,
pp. 6-7).
In a letter dated July 10, 1974 (Annex "D", Rollo, p. 86), petitioner
informed private respondent that the powder pufs the latter is
manufacturing and selling to various enterprises particularly those in
the cosmetics industry, resemble Identical or substantially Identical
powder pufs of which the former is a patent holder under Registration
Certifcation Nos. Extension UM-109, Extension UM-110 and Utility
Model No. 1184; petitioner explained such production and sale constitute
infringement of said patents and therefore its immediate discontinuance
is demanded, otherwise it will be compelled to take judicial action. (Rollo,
pp. 7-8).
Private respondent replied stating that her products are diferent and
countered that petitioner's patents are void because the utility models
applied for were not new and patentable and the person to whom the
patents were issued was not the true and actual author nor were her
rights derived from such author. (Taken from allegations in the Answer,
par. 4, Rollo, p. 93). And on July 25, 1974, private respondent assailed
the validity of the patents involved and fled with the Philippine Patent
Ofce petitions for cancellation of (1) Utility Model Letter Patent
Extension No. UM-109 (Inter Partes Case No. 838, Susana Luchan v.
Rosario C. Tan), (2) Utility Model Letters Patent No. UM-1184 (Inter
Partes Case No. 839, Susana Luchan v. Rosario C. Tan), (3) Utility Model
Letters Patent Extension No. UM-110 (Inter Partes Case No. 840, Susana
19
Luchan v. Rosario C. Tan. (Taken from allegations in the Answer, par. 10,
Rollo, pp. 94-95).
In view thereof, petitioner, on August 24, 1974, fled a complaint for
damages with injunction and preliminary injunction against private
respondent with the then Court of First Instance of Rizal, Pasig Branch,
docketed as Civil Case No. 19908, for infringing the aforesaid letters
patent, and prayed, among others, that a writ of preliminary injunction
be immediately issued (Complaint, Rollo, p. 90).
In her answer, private respondent alleged that the products she is
manufacturing and ofering for sale are not Identical, or even only
substantially Identical to the products covered by petitioner's patents
and, by way of afrmative defenses, further alleged that petitioner's
patents in question are void on the following grounds:
(1) at the time of fling of application for the patents involved, the
utility models applied for were not new and patentable under Sec. 55 of
R.A. 165, as amended by R.A. 864; and
(2) the person to whom the patents were issued was not the true and
actual author of the utility models applied for, and neither did she derive
her rights from any true and actual author of these utility models.
for the following reasons:
(a) since years prior to the fling of applications for the patents
involved, powder pufs of the kind applied for were then already existing
and publicly being sold in the market; both in the Philippines and
abroad; and
(b) applicant's claims in her applications, of "construction" or process
of manufacturing the utility models applied for, with respect to UM-423
and UM-450, were but a complicated and impractical version of an old,
simple one which has been well known to the cosmetics industry since
years previous to her fling of applications, and which belonged to no one
except to the general public; and with respect to UM1184; her claim in
her application of a unitary powder puf, was but an limitation of a
product well known to the cosmetics industry since years previous to her
20
fring of application, and which belonged to no one except to the general
public; (Answer, Rollo, pp. 93-94).
On September 18, 1974, the trial court issued an Order (Annex "K",
Rollo, p. 125) granting the preliminary injunction prayed for by
petitioner. Consequently, the corresponding writ was subsequently
issued (Annex "K-1", Rollo, p. 131) enjoining the herein private
respondent (then defendant) and all other persons employed by her, her
agents, servants and employees from directly or indirectly
manufacturing, making or causing to be made, selling or causing to be
sold, or using or causing to be used in accordance with, or embodying
the utility models of the Philippine Patent Ofce Utility Model Letters
Patent Nos. 423 (Extension No. UM-109), No. 450 (Extension No. UM-
110), and Utility Model No. 1184 or from infringement upon or violating
said letters patent in any way whatsoever (Annex " K-1 ", Rollo, p. 131).
Private respondent questioned the propriety of the trial court's issuance
of the Writ of Preliminary Injunction arguing that since there is still a
pending cancellation proceedings before the Philippine Patent Ofce
concerning petitioner's patents, such cannot be the basis for preliminary
injunction (Motion for Reconsideration, Rollo, p. 132).
In an Order dated September 11, 1975, the trial court denied private
respondent's motion for reconsideration (Annex "N", Rollo, p. 142).
In challenging these Orders private respondent fled a petition for
certiorari with the respondent court on September 29, 1975 (Annex "D",
Rollo, pp. 148-171) reiterating among other things the invalidity of
petitioner's patents and prayed that the trial court be restrained from
enforcing or continuing to enforce the following:
(1) Order dated September 18, 1974, granting the preliminary
injunction;
(2) Writ of preliminary injunction dated September 18, 1974; and
(3) Order dated September 11, 1974 denying petitioner's motion
petition for reconsideration.
21
On October 15, 1975, the Writ of Preliminary Injunction was issued by
the respondent Court of Appeals as follows:
NOW, THEREFORE, you, respondents, and/or any person/persons
acting on your stead, are hereby ENJOINED to RESTRAIN from enforcing
or continuing to enforce, the proceedings complained of in the petition to
wit: 1) Order dated September 18, 1974, granting the preliminary
injunction; 2) Writ of Preliminary Injunction dated September 18, 1974;
and Order dated September 11, 1975, denying petitioner's motion for
reconsideration, all issued in connection with Civil Case No. 19908,
UNTIL FURTHER ORDERS FROM THIS COURT. (Annex "P", Rollo, p.
1.73)
On February 16, 1976, respondent court promulgated a decision the
dispositive portion of which reads:
WHEREFORE, fnding no merit in the herein petition, the same is hereby
dismissed and the preliminary injunction previously issued by this Court
is hereby set aside, with costs.
SO ORDERED. (CA Decision, Rollo, p. 189).
ln said decision respondent court stated that in disposing of the petition
it tackled only the issue of whether the court a quo acted with grave
abuse of discretion in issuing the challenged orders. It made clear the
question of whether the patents have been infringed or not was not
determined considering the court a quo has yet to decide the case on the
merits (Ibid., p. 186).
Feeling aggrieved, private respondent moved to reconsider the afore-
mentioned Decision based on the following grounds:
I
THAT THIS HONORABLE COURT ERRED IN NOT APPRECIATING THE
EXISTENCE OF A FAIR QUESTION OF INVALIDITY OF PRIVATE
RESPONDENT'S PATENTS.
II
22
THAT THIS HONORABLE COURT ERRED IN NOT REJECTING THE
THEORY OF RESPONDENT JUDGE THAT HE HAS NO JURISDICTION
TO INVALIDATE THE PATENTS UPON GROUND OF LACK OF NOVELTY
OF THE PRODUCTS PATENTED. (Motion for Reconsideration, Rollo, p.
190).
Reviewing on reconsideration, respondent court gave weight to private
respondent's allegation that the latter's products are not identical or even
only substantially identical to the products covered by petitioner's
patents. Said court noticed that contrary to the lower courts position
that the court a quo had no jurisdiction to determine the question of
invalidity of the patents, Section 45 and 46 of the Patent Law allow the
court to make a fnding on the validity or invalidity of patents and in the
event there exists a fair question of its invalidity, the situation calls for a
denial of the writ of preliminary injunction pending the evaluation of the
evidence presented (Rollo, pp. 218-226). Thus, fnding the lower court's
position to have been opposed to Patent Law, respondent court
considered it a grave abuse of discretion when the court a quo issued the
writ being questioned without looking into the defenses alleged by herein
private respondent. Further, it considered the remedy of appeal, under
the circumstances, to be inadequate.
Thus, on July 6, 1976, respondent court made a complete turnabout
from its original decision and promulgated a Resolution, the dispositive
portion of which reads:
WHEREFORE, our decision is hereby set aside. The writ of certiorari is
ordered issued. Accordingly, the challenged orders, Exhibit H and H-1
and the order denying the motion for reconsideration (Annex "K",
Petition), are hereby set aside. The writ of preliminary injunction
previously ordered by this Court and ordered lifted by the Decision now
being set aside is hereby reinstated and made permanent. Without
pronouncement as to costs.
SO ORDERED. (CA Resolution, Rollo, p. 226).
In a Resolution dated November 4, 1976, respondent court, not
persuaded by the grounds embodied in the motion for reconsideration
fled by herein petitioner (Annex "V ", Rollo, p. 227), denied the same for
23
lack of merit, thereby maintaining the same stand it took in its July 6,
1976 Resolution (Rollo, p. 281). Hence, this petition.
On December 3, 1976, without giving due course to the petition, this
Court required respondent to fle her Comment (Rollo, p. 290) which was
fled on December 16, 1976 (Rollo, pp. 291-316). Thereafter, petitioner
fled her Reply (Rollo, p. 323) and on May 30, 1977, the petition was
given due course (Rollo, p. 345). Petitioner fled her brief on July 14,
1977 (Rollo, p. 351) while private respondent fled her brief on August
25, 1977 (Rollo, p. 359). Thereafter, petitioner having failed to fle reply
brief, the Court resolved to declare the case submitted for decision on
December 9, 1977 (Rollo, p. 359).
The assignment of errors raised by the petitioner in this case (Rollo, pp.
15-16) may be reduced to three main issues:
(1) Whether or not in an action for infringement the Court a quo had
jurisdiction to determine the invalidity of the patents at issue which
invalidity was still pending consideration in the patent ofce.
(2) Whether or not the Court a quo committed grave abuse of
discretion in the issuance of a writ of preliminary injunction.
(3) Whether or not certiorari is the proper remedy.
The frst issue has been laid to rest in a number of cases where the Court
ruled that "When a patent is sought to be enforced, the questions of
invention, novelty or prior use, and each of them, are open to judicial
examination." (Vargas v. F.M. Yaptico & Co. 40 Phil. 199 [1919]; Vargas v.
Chua, 57 Phil. 790-791 [1933]; Frank and Gohn v. Kosuyana 59 Phil.
207 [1933]).
Under the present Patent Law, there is even less reason to doubt that the
trial court has jurisdiction to declare the patents in question invalid. A
patentee shall have the exclusive right to make, use and sell the patented
article or product and the making, using, or selling by any person
without the authorization of the patentee constitutes infringement of the
patent (Sec. 37, R.A. 165). Any patentee whose rights have been infringed
upon may bring an action before the proper CFI now (RTC) and to secure
an injunction for the protection of his rights (Sec. 42, R.A. 165). Defenses
24
in an action for infringement are provided for in Section 45 of the same
law which in fact were availed of by private respondent in this case.
Then, as correctly stated by respondent Court of Appeals, this conclusion
is reinforced by Sec. 46 of the same law which provides that if the Court
shall fnd the patent or any claim thereof invalid, the Director shall on
certifcation of the fnal judgment ... issue an order cancelling the patent
or the claims found invalid and shall publish a notice thereof in the
Ofcial Gazette." Upon such certifcation, it is ministerial on the part of
the patent ofce to execute the judgment. (Rollo, pp. 221-222).
II.
The burden of proof to substantiate a charge of infringement is with the
plaintif. But where the plaintif introduces the patent in evidence, and
the same is in due form, there is created a prima facie presumption of its
correctness and validity. The decision of the Commissioner (now Director)
of Patent in granting the patent is presumed to be correct. The burden of
going forward with the evidence (burden of evidence) then shifts to the
defendant to overcome by competent evidence this legal presumption.
The question then in the instant case is whether or not the evidence
introduced by private respondent herein is sufcient to overcome said
presumption.
After a careful review of the evidence consisting of 64 exhibits and oral
testimonies of fve witnesses presented by private respondents before the
Court of First Instance before the Order of preliminary injunction was
issued as well as those presented by the petitioner, respondent Court of
Appeals was satisfed that there is a prima facie showing of a fair
question of invalidity of petitioner's patents on the ground of lack of
novelty. As pointed out by said appellate court said evidence appeared
not to have been considered at all by the court a quo for alleged lack of
jurisdiction, on the mistaken notion that such question in within the
exclusive jurisdiction of the patent ofce.
It has been repeatedly held that an invention must possess the essential
elements of novelty , originality and precedence and for the patentee to
be entitled to protection, the invention must be new to the world.
Accordingly, a single instance of public use of the invention by a patentee
for more than two years (now for more than one year only under Sec. 9 of
25
the Patent Law) before the date of his application for his patent, will be
fatal to, the validity of the patent when issued. (Frank, et al. v. Kosuyama
Vargas v. F.M. Yaptico & Co. and Vargas v. Chua, et al., supra).
The law provides:
SEC. 9. Invention not considered new or patentable. An invention shall
not be considered new or capable of being patented if it was known or
used by others in the Philippines before the invention thereof by the
inventor named in an application for patent for the invention; or if it was
patented or described in any printed publication in the Philippines or
any foreign country more than one year before the application for a
patent therefor; or if it had been in public use or on sale in the
Philippines for more than one year before the application for a patent
therefor; or if it is the subject matter of a validity issued patent in the
Philippines granted on an application fled before the fling of the
application for patent therefor.
Thus, more specifcally, under American Law from which our Patent Law
was derived (Vargas v. F.M. Yaptico & Co. supra) it is generally held that
in patent cases a preliminary injunction will not issue for patent
infringement unless the validity of the patent is clear and beyond
question. The issuance of letters patent, standing alone, is not sufcient
to support such drastic relief (8 Deller's Walker on Patents p. 406). In
cases of infringement of patent no preliminary injunction will be granted
unless the patent is valid and infringed beyond question and the record
conclusively proves the defense is sham. (Ibid., p. 402)
In the same manner, under our jurisprudence, as a general rule because
of the injurious consequences a writ of injunction may bring, the right to
the relief demanded must be clear and unmistakable. (Sangki v. Comelec,
21 SCRA 1392; December 26, 1967) and the dissolution of the writ is
proper where applicant has doubtful title to the disputed property.
(Ramos v. C.A., 95 SCRA 359).
III.
It will be noted that the validity of petitioner's patents is in question for
want of novelty. Private respondent contends that powder pufs Identical
in appearance with that covered by petitioner's patents existed and were
26
publicly known and used as early as 1963 long before petitioner was
issued the patents in question. (List of Exhibits, Rollo, pp. 194-199). As
correctly observed by respondent Court of Appeals, "since sufcient
proofs have been introduced in evidence showing a fair question of the
invalidity of the patents issued for such models, it is but right that the
evidence be looked into, evaluated and determined on the merits so that
the matter of whether the patents issued were in fact valid or not may be
resolved." (Rollo, pp. 286-287).
All these notwithstanding, the trial court nonetheless issued the writ of
preliminary injunction which under the circumstances should be denied.
For failure to determine frst the validity of the patents before aforesaid
issuance of the writ, the trial court failed to satisfy the two requisites
necessary if an injunction is to issue, namely: the existence of the right
to be protected and the violation of said right. (Buayan Cattle Co., Inc. v.
Quintillan, 128 SCRA 276).
Under the above established principles, it appears obvious that the trial
court committed a grave abuse of discretion which makes certiorari the
appropriate remedy.
As found by respondent Court of Appeals, the injunctive order of the trial
court is of so general a tenor that petitioner may be totally barred from
the sale of any kind of powder puf. Under the circumstances,
respondent appellate court is of the view that ordinary appeal is
obviously inadequate. (Rollo, p. 288). A parallel was drawn from a
decision of the Supreme Court in the case of Sanchez v. Hon. Court of
Appeals, 69 SCRA 328 [1976] where the First Division of the Supreme
Court ruled that "The prerogative writ of certiorari may be applied for by
proper petition notwithstanding the existence of the regular remedy of an
appeal in due cause when among other reasons, the broader interests of
justice so require or an ordinary appeal is not an adequate remedy."
Private respondent maintains the position that the resolutions sought to
be appealed from had long become fnal and executory for failure of Hon.
Reynaldo P. Honrado, the trial court judge, to appeal by certiorari from
the resolutions of respondent Court of Appeals. (Rollo, pp. 291-292).
Such contention is untenable.
27
There is no dispute that petitioner has seasonably petitioned. On the
other hand, it is elementary that the trial judge is a mere nominal party
as clearly provided in Section 5, Rule 65 of the Revised Rules of Court
where it shall be the duty of such person or persons interested in
sustaining the proceedings in court, "to appear and defend, both in his
or their own behalf and in behalf of the court or judge afected by the
proceedings."
Relative thereto "the judge whose order is under attack is merely a
nominal party; wherefore, a judge in his ofcial capacity should not be
made to appear as a party seeking reversal of a decision that is
unfavorable to the action taken by him." (Hon. Alcasid v. Samson, 102
Phil. 735-736; Tarona v. Sayo, 67 SCRA 508, 524; Lim Se v. Argel, 70
SCRA 378).
As to petitioner's claim of prescription, private respondent's contention
that such refers to the fling of petitions for cancellation in the Patent
Ofce under Sec. 28 of the Patent Law and not to a defense against an
action for infringement under Sec. 45 thereof which may be raised
anytime, is evident under aforesaid law.
PREMISES CONSIDERED, the assailed resolutions of the Court of
Appeals are hereby AFFIRMED.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 113388September 5, 1997
ANGELITA MANZANO, petitioner,
28
vs.
COURT OF APPEALS, and MELECIA MADOLARIA, as Assignor to
NEW UNITED FOUNDRY MANUFACTURING CORPORATION,
respondents.
BELLOSILLO, J.:
The primary purpose of the patent system is not the reward of the
individual but the advancement of the arts and sciences. The function of
a patent is to add to the sum of useful knowledge and one of the
purposes of the patent system is to encourage dissemination of
information concerning discoveries and inventions. This is a matter
which is properly within the competence of the Patent Ofce the ofcial
action of which has the presumption of correctness and may not be
interfered with in the absence of new evidence carrying thorough
conviction that the Ofce has erred. Since the Patent Ofce is an expert
body preeminently qualifed to determine questions of patentability, its
fndings must be accepted if they are consistent with the evidence, with
doubts as to patentability resolved in favor of the Patent Ofce. 1
Petitioner Angelita Manzano fled with the Philippine Patent Ofce on 19
February 1982 an action for the cancellation of Letters Patent No. UM-
4609 for a gas burner registered in the name of respondent Melecia
Madolaria who subsequently assigned the letters patent to New United
Foundry and Manufacturing Corporation (UNITED FOUNDRY, for
brevity). Petitioner alleged that (a) the utility model covered by the letters
patent, in this case, an LPG gas burner, was not inventive, new or useful;
(b) the specifcation of the letters patent did not comply with the
requirements of Sec. 14, RA No. 165, as amended; (c) respondent Melecia
Madolaria was not the original, true and actual inventor nor did she
derive her rights from the original, true and actual inventor of the utility
model covered by the letters patent; and, (d) the letters patent was
secured by means of fraud or misrepresentation. In support of her
petition for cancellation petitioner further alleged that (a) the utility
model covered by the letters patent of respondent had been known or
used by others in the Philippines for more than one (1) year before she
fled her application for letters patent on 9 December 1979; (b) the
products which were produced in accordance with the utility model
covered by the letters patent had been in public use or on sale in the
29
Philippines for more than one (1) year before the application for patent
therefor was fled.
Petitioner presented the following documents which she correspondingly
marked as exhibits: (a) afdavit of petitioner alleging the existence of
prior art, marked Exh. "A;" (b) a brochure distributed by Manila Gas
Corporation disclosing a pictorial representation of Ransome Burner
made by Ransome Torch and Burner Company, USA, marked Exh. "D;"
and, (c) a brochure distributed by Esso Gasul or Esso Standard Eastern,
Inc., of the Philippines showing a picture of another similar burner with
top elevation view and another perspective view of the same burner,
marked Exh. "E."
Testifying for herself petitioner narrated that her husband Ong Bun Tua
worked as a helper in the UNITED FOUNDRY where respondent Melecia
Madolaria used to be afliated with from 1965 to 1970; that Ong helped
in the casting of an LPG burner which was the same utility model of a
burner for which Letters Patent No. UM-4609 was issued, and that after
her husband's separation from the shop she organized Besco Metal
Manufacturing (BESCO METAL, for brevity) for the casting of LPG
burners one of which had the confguration, form and component parts
similar to those being manufactured by UNITED FOUNDRY. Petitioner
presented in evidence an alleged model of an LPG burner marked Exh.
"K" and covered by the Letters Patent of respondent, and testifed that it
was given to her in January 1982 by one of her customers who allegedly
acquired it from UNITED FOUNDRY. Petitioner also presented in evidence
her own model of an LPG burner called "Ransome" burner marked Exh.
"L," which was allegedly manufactured in 1974 or 1975 and sold by her
in the course of her business operation in the name of BESCO METAL.
Petitioner claimed that this "Ransome" burner (Exh. "L") had the same
confguration and mechanism as that of the model which was patented
in favor of private respondent Melecia Madolaria. Also presented by
petitioner was a burner cup of an imported "Ransome" burner marked
Exh "M" which was allegedly existing even before the patent application
of private respondent.
Petitioner presented two (2) other witnesses, namely, her husband Ong
Bun Tua and Fidel Francisco. Ong testifed that he worked as a helper in
the UNITED FOUNDRY from 1965 to 1970 where he helped in the
casting of LPG burners with the same form, confguration and
30
mechanism as that of the model covered by the Letters Patent issued to
private respondent. Francisco testifed that he had been employed with
the Manila Gas Corporation from 1930 to 1941 and from 1952 up to
1969 where he retired as supervisor and that Manila Gas Corporation
imported "Ransome" burners way back in 1965 which were advertised
through brochures to promote their sale.
Private respondent, on the other hand, presented only one witness,
Rolando Madolaria, who testifed, among others, that he was the General
Supervisor of the UNITED FOUNDRY in the foundry, machine and
bufng section; that in his early years with the company, UNITED
FOUNDRY was engaged in the manufacture of diferent kinds of gas
stoves as well as burners based on sketches and specifcations furnished
by customers; that the company manufactured early models of single-
piece types of burners where the mouth and throat were not detachable;
that in the latter part of 1978 respondent Melecia Madolaria confded in
him that complaints were being brought to her attention concerning the
early models being manufactured; that he was then instructed by private
respondent to cast several experimental models based on revised
sketches and specifcations; that private respondent again made some
innovations; that after a few months, private respondent discovered the
solution to all the defects of the earlier models and, based on her latest
sketches and specifcations, he was able to cast several models
incorporating the additions to the innovations introduced in the models.
Various tests were conducted on the latest model in the presence and
under the supervision of Melecia Madolaria and they obtained perfect
results. Rolando Madolaria testifed that private respondent decided to
fle her application for utility model patent in December 1979.
On 7 July 1986 the Director of Patents Cesar C. Sandiego issued
Decision No. 86-56 denying the petition for cancellation and holding that
the evidence of petitioner was not able to establish convincingly that the
patented utility model of private respondent was anticipated. Not one of
the various pictorial representations of business clearly and convincingly
showed that the devices presented by petitioner was identical or
substantially identical with the utility model of the respondent. The
decision also stated that even assuming that the brochures depicted
clearly each and every element of the patented gas burner device so that
the prior art and patented device became identical although in truth they
were not, they could not serve as anticipatory bars for the reason that
31
they were undated. The dates when they were distributed to the public
were not indicated and, therefore, were useless prior art references. The
records and evidence also do not support the petitioner's contention that
Letters Patent No. UM-4609 was obtained by means of fraud and/or
misrepresentation. No evidence whatsoever was presented by petitioner
to show that the then applicant Melecia Madolaria withheld with intent
to deceive material facts which, if disclosed, would have resulted in the
refusal by the Philippine Patent Ofce to issue the Letters Patent under
inquiry.
Petitioner elevated the decision of the Director of Patents to the Court of
Appeals which on 15 October 1993 afrmed the decision of the Director
of Patents. Hence, this petition for review on certiorari alleging that the
Court of Appeals erred (a) in relying on imaginary diferences which in
actuality did not exist between the model of private respondent covered
by Letters Patent No. UM-4609 and the previously known model of Esso
Standard Eastern, Inc., and Manila Gas Corporation, making such
imaginary diferences grounded entirely on speculation, surmises and
conjectures; (b) in rendering judgment based on misapprehension of
facts; (c) in relying mainly on the testimony of private respondent's sole
witness Rolando Madolaria; and, (d) in not cancelling Letters Patent No.
UM-4609 in the name of private respondent.
Petitioner submits that the diferences cited by the Court of Appeals
between the utility model of private respondent and the models of Manila
Gas Corporation and Esso Standard Eastern, Inc., are more imaginary
than real. She alleges that based on Exhs. "E," "E-1," "F" and "F-1" or the
brochures of Manila Gas Corporation and Esso Standard Eastern, Inc.,
presented by petitioner, the cup-shaped burner mouth and threaded hole
on the side are shown to be similar to the utility model of private
respondent. The exhibits also show a detachable burner mouth having a
plurality of upwardly existing undulations adopted to act as gas passage
when the cover is attached to the top of said cup-shaped mouth all of
which are the same as those in the patented model. Petitioner also denies
as substantial diference the short cylindrical tube of the burner mouth
appearing in the brochures of the burners being sold by Manila Gas
Corporation and the long cylindered tube of private respondent's model
of the gas burner.
32
Petitioner argues that the actual demonstration made during the hearing
disclosed the similarities in form, operation and mechanism and parts
between the utility model of private respondent and those depicted in the
brochures. The fndings of the Patent Ofce and the Court of Appeals
that the brochures of Manila Gas Corporation and Esso Standard
Eastern, Inc., are undated cannot overcome the fact of their circulation
before private respondent fled her application for utility model patent.
Petitioner thus asks this Court to take judicial notice of the fact that
Esso Standard Eastern, Inc., disappeared before 1979 and reappeared
only during the Martial Law years as Petrophil Corporation. Petitioner
also emphasizes that the brochures indicated the telephone number of
Manila Gas Corporation as 5-79-81 which is a fve (5) numbered
telephone number existing before 1975 because telephones in Metro
Manila started to have six (6) numbers only after that year.
Petitioner further contends that the utility model of private respondent is
absolutely similar to the LPG burner being sold by petitioner in 1975 and
1976, and also to the "Ransome" burner depicted in the old brochures of
Manila Gas Corporation and Esso Standard Eastern, Inc., fabricated by
Ransome Torch and Burner Company of Oakland, California, USA,
especially when considered through actual physical examination,
assembly and disassembly of the models of petitioner and private
respondent. Petitioner faults the Court of Appeals for disregarding the
testimonies of Ong Bun Tua and Fidel Francisco for their failure to
produce documents on the alleged importation by Manila Gas
Corporation of "Ransome" burners in 1965 which had the same
confguration, form and mechanism as that of the private respondent's
patented model.
Finally, it is argued that the testimony of private respondent's lone
witness Rolando Madolaria should not have been given weight by the
Patent Ofce and the Court of Appeals because it contained mere after-
thoughts and pretensions.
We cannot sustain petitioner. Section 7 of RA No. 165, as amended,
which is the law on patents, expressly provides
Sec. 7. Inventians patentable. Any invention of a new and useful
machine, manufactured product or substance, process or an
improvement of any of the foregoing, shall be patentable.
33
Further, Sec. 55 of the same law provides
Sec. 55. Design patents and patents for utility models. (a) Any new,
original and ornamental design for an article of manufacture and (b) any
new model of implements or tools or of any industrial product or of part
of the same, which does not possess the quality of invention, but which
is of practical utility by reason of its form, confguration, construction or
composition, may be protected by the author thereof, the former by a
patent for a design and the latter by a patent for a utility model, in the
same manner and subject to the same provisions and requirements as
relate to patents for inventions insofar as they are applicable except as
otherwise herein provided.
The element of novelty is an essential requisite of the patentability of an
invention or discovery. If a device or process has been known or used by
others prior to its invention or discovery by the applicant, an application
for a patent therefor should be denied; and if the application has been
granted, the court, in a judicial proceeding in which the validity of the
patent is drawn in question, will hold it void and inefective. 2 It has been
repeatedly held that an invention must possess the essential elements of
novelty, originality and precedence, and for the patentee to be entitled to
the protection the invention must be new to the world. 3
In issuing Letters Patent No. UM-4609 to Melecia Madolaria for an "LPG
Burner" on 22 July 1981, the Philippine Patent Ofce found her
invention novel and patentable. The issuance of such patent creates a
presumption which yields only to clear and cogent evidence that the
patentee was the original and frst inventor. The burden of proving want
of novelty is on him who avers it and the burden is a heavy one which is
met only by clear and satisfactory proof which overcomes every
reasonable doubt. 4 Hence, a utility model shall not be considered "new"
if before the application for a patent it has been publicly known or
publicly used in this country or has been described in a printed
publication or publications circulated within the country, or if it is
substantially similar to any other utility model so known, used or
described within the country. 5
As found by the Director of Patents, the standard of evidence sufcient to
overcome the presumption of legality of the issuance of UM-4609 to
34
respondent Madolaria was not legally met by petitioner in her action for
the cancellation of the patent. Thus the Director of Patents explained his
reasons for the denial of the petition to cancel private respondent's
patent
Scrutiny of Exhs. "D" and "E" readily reveals that the utility model (LPG
Burner) is not anticipated. Not one of the various pictorial
representations of burners clearly and convincingly show that the device
presented therein is identical or substantially identical in construction
with the aforesaid utility model. It is relevant and material to state that
in determining whether novelty or newness is negatived by any prior art,
only one item of the prior art may be used at a time. For anticipation to
occur, the prior art must show that each element is found either
expressly or described or under principles of inherency in a single prior
art reference or that the claimed invention was probably known in a
single prior art device or practice. (Kalman v. Kimberly Clark, 218 USPQ
781, 789)
Even assuming gratia arguendi that the aforesaid brochures do depict
clearly on all fours each and every element of the patented gas burner
device so that the prior art and the said patented device become
identical, although in truth they are not, they cannot serve as
anticipatory bars for the reason that they are undated. The dates when
they were distributed to the public were not indicated and, therefore,
they are useless prior art references.
xxx xxx xxx
Furthermore, and more signifcantly, the model marked Exh. "K" does
not show whether or not it was manufactured and/or cast before the
application for the issuance of patent for the LPG burner was fled by
Melecia Madolaria.
With respect to Exh. "L," petitioner claimed it to be her own model of LPG
burner allegedly manufactured sometime in 1974 or 1975 and sold by
her in the course of her business operation in the name of Besco Metal
Manufacturing, which burner was denominated as "Ransome" burner
xxx xxx xxx
35
But a careful examination of Exh. "L" would show that it does not bear
the word "Ransome" which is the burner referred to as the product being
sold by the Petitioner. This is not the way to prove that Exh. "L"
anticipates Letters Patent No. UM-4609 through Exhs. "C" and "D."
Another factor working against the Petitioner's claims is that an
examination of Exh. "L" would disclose that there is no indication of the
time or date it was manufactured. This Ofce, thus has no way of
determining whether Exh. "L" was really manufactured before the fling of
the aforesaid application which matured into Letters Patent No. UM-
4609, subject matter of the cancellation proceeding.
At this juncture, it is worthwhile to point out that petitioner also
presented Exh. "M" which is the alleged burner cup of an imported
"Ransome" burner. Again, this Ofce fnds the same as unreliable
evidence to show anticipation. It observed that there is no date indicated
therein as to when it was manufactured and/or imported before the fling
of the application for issuance of patent of the subject utility model.
What is more, some component parts of Exh. "M" are missing, as only
the cup was presented so that the same could not be compared to the
utility model (subject matter of this case) which consists of several other
detachable parts in combination to form the complete LPG burner.
xxx xxx xxx
It must likewise be pointed out that Ong Bun Tua testifed on the
brochures allegedly of Manila Gas and of Esso Gasul marked Exhs. "E"
and "F" and on the alleged fact that Manila Gas Corporation was
importing from the United States "Ransome" burners. But the same
could not be given credence since he himself admitted during cross-
examination that he has never been connected with Manila Gas
Corporation. He could not even present any importation papers relating
to the alleged imported ransome burners. Neither did his wife. 6
The above fndings and conclusions of the Director of Patent were
reiterated and afrmed by the Court of Appeals. 7
The validity of the patent issued by the Philippine Patent Ofce in favor
of private respondent and the question over the inventiveness, novelty
and usefulness of the improved model of the LPG burner are matters
which are better determined by the Patent Ofce. The technical staf of
36
the Philippine Patent Ofce composed of experts in their feld has by the
issuance of the patent in question accepted private respondent's model of
gas burner as a discovery. There is a presumption that the Ofce has
correctly determined the patentability of the model 8 and such action
must not be interfered with in the absence of competent evidence to the
contrary.
The rule is settled that the fndings of fact of the Director of Patents,
especially when afrmed by the Court of Appeals, are conclusive on this
Court when supported by substantial evidence. Petitioner has failed to
show compelling grounds for a reversal of the fndings and conclusions of
the Patent Ofce and the Court of Appeals.
The alleged failure of the Director of Patents and the Court of Appeals to
accord evidentiary weight to the testimonies of the witnesses of petitioner
showing anticipation is not a justifcation to grant the petition. Pursuant
to the requirement of clear and convincing evidence to overthrow the
presumption of validity of a patent, it has been held that oral testimony
to show anticipation is open to suspicion and if uncorroborated by cogent
evidence, as what occurred in this case, it may be held insufcient. 9
Finally, petitioner would want this Court to review all over again the
evidence she presented before the Patent Ofce. She argues that contrary
to the decision of the Patent Ofce and the Court of Appeals, the
evidence she presented clearly proves that the patented model of private
respondent is no longer new and, therefore, fraud attended the
acquisition of patent by private respondent.
It has been held that the question on priority of invention is one of fact.
Novelty and utility are likewise questions of fact. The validity of patent is
decided on the basis of factual inquiries. Whether evidence presented
comes within the scope of prior art is a factual issue to be resolved by
the Patent Ofce. 10 There is question of fact when the doubt or
diference arises as to the truth or falsehood of alleged facts or when the
query necessarily invites calibration of the whole evidence considering
mainly the credibility of witnesses, existence and relevance of specifc
surrounding circumstances, their relation to each other and to the whole
and the probabilities of the situation. 11
37
Time and again we have held that it is not the function of the Supreme
Court to analyze or weigh all over again the evidence and credibility of
witnesses presented before the lower tribunal or ofce. The Supreme
Court is not a trier of facts. Its jurisdiction is limited to reviewing and
revising errors of law imputed to the lower court, its fndings of fact being
conclusive and not reviewable by this Court.
WHEREFORE, the Petition is DENIED. The Decision of the Court of
Appeals afrming that of the Philippine Patent Ofce is AFFIRMED.
Costs against petitioner.
SO ORDERED.
38
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 118708February 2, 1998
CRESER PRECISION SYSTEMS, INC., petitioner,
vs.
COURT OF APPEALS AND FLORO INTERNATIONAL CORP.,
respondents.
MARTINEZ, J.:
This petition for review on certiorari assails the decision 1 of the Court of
Appeals dated November 9, 1994 in C.A.-G.R. SP No. 34425 entitled
"Floro International Corp. vs. Hon. Tirso D.C Cruz and Creser Precision
System, Inc.", the dispositive portion of which reads:
WHEREFORE, THE PETITION IS HEREBY GRANTED. THE COMPLAINT
FOR INJUNCTION AND DAMAGES, CIVIL CASE NO. 93-1856 BEFORE
THE RESPONDENT JUDGE IS HEREBY ORDERED DISMISSED AND
HIS ORDERS THEREIN OF DECEMBER 29, 1993 AND MAY 11, 1994
ARE ORDERED SET ASIDE.
Private respondent is a domestic corporation engaged in the
manufacture, production, distribution and sale of military armaments,
munitions, airmunitions and other similar materials. 2
On January 23, 1990, private respondent was granted by the Bureau of
Patents, Trademarks and Technology Transfer (BPTTT), a Letters Patent
No. UM-6938 3 covering an aerial fuze which was published in the
39
September-October-1990, Vol. III, No. 5 issue of the Bureau of Patent's
Ofcial Gazette. 4
Sometime in November 1993, private respondent, through its president,
Mr. Gregory Floro, Jr., discovered that petitioner submitted samples of its
patented aerial fuze to the Armed Forces of the Philippines (AFP) for
testing. He learned that petitioner was claiming the aforesaid aerial fuze
as its own and planning to bid and manufacture the same commercially
without license or authority from private respondent. To protect its right,
private respondent on December 3, 1993, sent a letter 5 to petitioner
advising it of its existing patent and its rights thereunder, warning
petitioner of a possible court action and/or application for injunction,
should it proceed with the scheduled testing by the military on December
7, 1993.
In response to private respondent's demand, petitioner fled on December
8, 1993 a complaint 6 for injunction and damages arising from the
alleged infringement before the Regional Trial Court of Quezon City,
Branch 88. The complaint alleged, among others: that petitioner is the
frst, true and actual inventor of an aerial fuze denominated as "Fuze,
PDR 77 CB4" which it developed as early as December 1981 under the
Self-Reliance Defense Posture Program (SRDP) of the AFP; that sometime
in 1986, petitioner began supplying the AFP with the said aerial fuze;
that private respondent's aerial fuze is identical in every respect to the
petitioner's fuze; and that the only diference between the two fuzes are
miniscule and merely cosmetic in nature. Petitioner prayed that a
temporary restraining order and/or writ of preliminary injunction be
issued enjoining private respondent including any and all persons acting
on its behalf from manufacturing, marketing and/or profting therefrom,
and/or from performing any other act in connection therewith or tending
to prejudice and deprive it of any rights, privileges and benefts to which
it is duly entitled as the frst, true and actual inventor of the aerial fuze.
On December 10, 1993, the trial court issued a temporary restraining
order. Thereafter, hearings were held on the application of petitioner for
the issuance of a writ of preliminary injunction, with both parties
presenting their evidence. After the hearings, the trial court directed the
parties to submit their respective memoranda in support of their
positions.
40
On December 27, 1993, private respondent submitted its memorandum
7 alleging that petitioner has no cause of action to fle a complaint for
infringement against it since it has no patent for the aerial fuze which it
claims to have invented; that petitioner's available remedy is to fle a
petition for cancellation of patent before the Bureau of Patents; that
private respondent as the patent holder cannot be stripped of its
property right over the patented aerial fuze consisting of the exclusive
right to manufacture, use and sell the same and that it stands to sufer
irreparable damage and injury if it is enjoined from the exercise of its
property rights over its patent.
On December 29, 1993, the trial court issued an Order 8 granting the
issuance of a writ of preliminary injunction against private respondent
the dispositive portion of which reads:
WHEREFORE, plaintifs application for the issuance of a writ of
preliminary injunction is granted and, upon posting of the corresponding
bond by plaintif in the amount of PHP 200,000.00, let the writ of
preliminary injunction be issued by the branch Clerk of this Court
enjoining the defendant and any and all persons acting on its behalf or
by and under its authority, from manufacturing, marketing and/or
selling aerial fuzes identical, to those of plaintif, and from profting
therefrom, and/or from performing any other act in connection therewith
until further orders from this Court.
Private respondent moved for reconsideration but this was denied by the
trial court in its Order 9 of May 11, 1994, pertinent portions of which
read:
For resolution before this Court is the Motion for Reconsideration fled by
the defendant and the plaintif's Opposition thereto. The Court fnds no
sufcient cause to reconsider its order dated December 29, 1993. During
the hearing for the issuance of the preliminary injunction, the plaintif
has amply proven its entitlement to the relief prayed for. It is undisputed
that the plaintif has developed its aerial fuze way back in 1981 while the
defendant began manufacturing the same only in 1987. Thus, it is only
logical to conclude that it was the plaintif's aerial fuze that was copied
or imitated which gives the plaintif the right to have the defendant
enjoined "from manufacturing, marketing and/or selling aerial fuzes
identical to those of the plaintif, and from profting therefrom and/or
41
performing any other act in connection therewith until further orders
from this Court." With regards to the defendant's assertion that an action
for infringement may only be brought by "anyone possessing right, title or
interest to the patented invention," (Section 42, RA 165) qualifed by Sec.
10, RA 165 to include only "the frst true and actual inventor, his heirs,
legal representatives or assignees, "this court fnds the foregoing to be
untenable. Sec. 10 merely enumerates the persons who may have an
invention patented which does not necessarily limit to these persons the
right to institute an action for infringement. Defendant further contends
that the order in issue is disruptive of the status quo. On the contrary,
the order issued by the Court in efect maintained the status quo. The
last actual, peaceable uncontested status existing prior to this
controversy was the plaintif manufacturing and selling its own aerial
fuzes PDR 77 CB4 which was ordered stopped through the defendant's
letter. With the issuance of the order, the operations of the plaintif
continue. Lastly, this court believes that the defendant will not sufer
irreparable injury by virtue of said order. The defendant's claim is
primarily hinged on its patent (Letters Patent No. UM-6983) the validity
of which is being questioned in this case.
WHEREFORE, premises considered, the Motion for Reconsideration is
hereby denied for lack of merit.
SO ORDERED.
Aggrieved, private respondent on June 27, 1994, fled a petition for
certiorari, mandamus and prohibition 10 before respondent Court of
Appeals raising as grounds the following:
a. Petitioner has no cause of action for infringement against private
respondent, the latter not having any patent for the aerial fuze which it
claims to have invented and developed and allegedly infringed by private
respondent;
b. the case being an action for cancellation or invalidation of private
respondent's Letters Patent over its own aerial fuze, the proper venue is
the Ofce of the Director of Patents;
42
c. The trial court acted in grave abuse of discretion and/or in excess
of jurisdiction in fnding that petitioner has fully established its clear title
or right to preliminary injunction;
d. The trial court acted in grave abuse of discretion and/or in excess
of jurisdiction in granting the preliminary injunction, it being disruptive
of the status quo; and
e. The trial court acted in grave abuse of discretion and/or in excess
of jurisdiction in granting the preliminary injunction thereby depriving
private respondent of its property rights over the patented aerial fuze and
cause it irreparable damages.
On November 9, 1994, the respondent court rendered the now assailed
decision reversing the trial court's Order of December 29, 1993 and
dismissing the complaint fled by petitioner.
The motion for reconsideration was also denied on January 17, 1995. 11
Hence, this present petition.
It is petitioner's contention that it can fle, under Section 42 of the Patent
Law (R.A. 165), an action for infringement not as a patentee but as an
entity in possession of a right, title or interest in and to the patented
invention. It advances the theory that while the absence of a patent may
prevent one from lawfully suing another for infringement of said patent,
such absence does not bar the frst true and actual inventor of the
patented invention from suing another who was granted a patent in a
suit for declaratory or injunctive relief recognized under American patent
laws. This remedy, petitioner points out, may be likened to a civil action
for infringement under Section 42 of the Philippine Patent Law.
We fnd the above arguments untenable.
Section 42 of R.A. 165, otherwise known as the Patent Law, explicitly
provides:
Sec. 42. Civil action for infringement. Any patentee, or anyone
possessing any right, title or interest in and to the patented invention,
whose rights have been infringed, may bring a civil action before the
proper Court of First Instance (now Regional Trial court), to recover from
43
the infringer damages sustained by reason of the infringement and to
secure an injunction for the protection of his right. . . .
Under the aforequoted law, only the patentee or his successors-in-
interest may fle an action for infringement. The phrase "anyone
possessing any right, title or interest in and to the patented invention"
upon which petitioner maintains its present suit, refers only to the
patentee's successors-in-interest, assignees or grantees since actions for
infringement of patent may be brought in the name of the person or
persons interested, whether as patentee, assignees, or as grantees, of the
exclusive right. 12 Moreover, there can be no infringement of a patent
until a patent has been issued, since whatever right one has to the
invention covered by the patent arises alone from the grant of patent. 13
In short, a person or entity who has not been granted letters patent over
an invention and has not acquired any light or title thereto either as
assignee or as licensee, has no cause of action for infringement because
the right to maintain an infringement suit depends on the existence of
the patent. 14
Petitioner admits it has no patent over its aerial fuze. Therefore, it has no
legal basis or cause of action to institute the petition for injunction and
damages arising from the alleged infringement by private respondent.
While petitioner claims to be the frst inventor of the aerial fuze, still it
has no right of property over the same upon which it can maintain a suit
unless it obtains a patent therefor. Under American jurisprudence, an
inventor has no common-law right to a monopoly of his invention. He has
the right to make, use and vend his own invention, but if he voluntarily
discloses it, such as by ofering it for sale, the world is free to copy and
use it with impunity. A patent, however, gives the inventor the right to
exclude all others. As a patentee, he has the exclusive right of making,
using or selling the invention. 15
Further, the remedy of declaratory judgment or injunctive suit on patent
invalidity relied upon by petitioner cannot be likened to the civil action
for infringement under Section 42 of the Patent Law. The reason for this
is that the said remedy is available only to the patent holder or his
successors-in-interest. Thus, anyone who has no patent over an
invention but claims to have a right or interest thereto can not fle an
action for declaratory judgment or injunctive suit which is not recognized
in this jurisdiction. Said person, however, is not left without any remedy.
44
He can, under Section 28 of the aforementioned law, fle a petition for
cancellation of the patent within three (3) years from the publication of
said patent with the Director of Patents and raise as ground therefor that
the person to whom the patent was issued is not the true and actual
inventor. Hence, petitioner's remedy is not to fle an action for injunction
or infringement but to fle a petition for cancellation of private
respondent's patent. Petitioner however failed to do so. As such, it can
not now assail or impugn the validity of the private respondent's letters
patent by claiming that it is the true and actual inventor of the aerial
fuze.
Thus, as correctly ruled by the respondent Court of Appeals in its
assailed decision: "since the petitioner (private respondent herein) is the
patentee of the disputed invention embraced by letters of patent UM No.
6938 issued to it on January 23, 1990 by the Bureau of Patents, it has
in its favor not only the presumption of validity of its patent, but that of a
legal and factual frst and true inventor of the invention."
In the case of Aguas vs. De Leon, 16 we stated that:
The validity of the patent issued by the Philippine Patent Ofce in favor
of the private respondent and the question over the investments, novelty
and usefulness of the improved process therein specifed and described
are matters which are better determined by the Philippines Patent Ofce.
The technical Staf of the Philippines Patent Ofce, composed of experts
in their feld, have, by the issuance of the patent in question, accepted
the thinness of the private respondent's new tiles as a discovery. There is
a presumption that the Philippine Patent Ofce has correctly determined
the patentability of the improvement by the private respondent of the
process in question.
In fne, in the absence of error or abuse of power or lack of jurisdiction or
grave abuse of discretion, we sustain the assailed decision of the
respondent Court of Appeal.
WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED.
No pronouncement as to costs.
SO ORDERED.
45
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G. R. No. 126627 August 14, 2003
SMITH KLINE BECKMAN CORPORATION, Petitioner,
vs.
THE HONORABLE COURT OF APPEALS and TRYCO PHARMA
CORPORATION, Respondents.
D E C I S I O N
CARPIO-MORALES, J.:
Smith Kline Beckman Corporation (petitioner), a corporation existing by
virtue of the laws of the state of Pennsylvania, United States of America
(U.S.) and licensed to do business in the Philippines, fled on October 8,
1976, as assignee, before the Philippine Patent Ofce (now Bureau of
Patents, Trademarks and Technology Transfer) an application for patent
over an invention entitled "Methods and Compositions for Producing
Biphasic Parasiticide Activity Using Methyl 5 Propylthio-2-Benzimidazole
Carbamate." The application bore Serial No. 18989.
On September 24, 1981, Letters Patent No. 145611 for the aforesaid
invention was issued to petitioner for a term of seventeen (17) years.
The letters patent provides in its claims2 that the patented invention
consisted of a new compound named methyl 5 propylthio-2-
benzimidazole carbamate and the methods or compositions utilizing the
compound as an active ingredient in fghting infections caused by
gastrointestinal parasites and lungworms in animals such as swine,
sheep, cattle, goats, horses, and even pet animals.
46
Tryco Pharma Corporation (private respondent) is a domestic corporation
that manufactures, distributes and sells veterinary products including
Impregon, a drug that has Albendazole for its active ingredient and is
claimed to be efective against gastro-intestinal roundworms, lungworms,
tapeworms and fuke infestation in carabaos, cattle and goats.
Petitioner sued private respondent for infringement of patent and unfair
competition before the Caloocan City Regional Trial Court (RTC).3 It
claimed that its patent covers or includes the substance Albendazole
such that private respondent, by manufacturing, selling, using, and
causing to be sold and used the drug Impregon without its authorization,
infringed Claims 2, 3, 4, 7, 8 and 9 of Letters Patent No. 145614 as well
as committed unfair competition under Article 189, paragraph 1 of the
Revised Penal Code and Section 29 of Republic Act No. 166 (The
Trademark Law) for advertising and selling as its own the drug Impregon
although the same contained petitioners patented Albendazole.5
On motion of petitioner, Branch 125 of the Caloocan RTC issued a
temporary restraining order against private respondent enjoining it from
committing acts of patent infringement and unfair competition.6 A writ of
preliminary injunction was subsequently issued.7
Private respondent in its Answer8 averred that Letters Patent No. 14561
does not cover the substance Albendazole for nowhere in it does that
word appear; that even if the patent were to include Albendazole, such
substance is unpatentable; that the Bureau of Food and Drugs allowed it
to manufacture and market Impregon with Albendazole as its known
ingredient; that there is no proof that it passed of in any way its
veterinary products as those of petitioner; that Letters Patent No. 14561
is null and void, the application for the issuance thereof having been fled
beyond the one year period from the fling of an application abroad for
the same invention covered thereby, in violation of Section 15 of Republic
Act No. 165 (The Patent Law); and that petitioner is not the registered
patent holder.
Private respondent lodged a Counterclaim against petitioner for such
amount of actual damages as may be proven; P1,000,000.00 in moral
damages; P300,000.00 in exemplary damages; and P150,000.00 in
attorneys fees.
47
Finding for private respondent, the trial court rendered a Decision dated
July 23, 1991,9 the dispositive portion of which reads:
WHEREFORE, in view of the foregoing, plaintifs complaint should be, as
it is hereby, DISMISSED. The Writ of injunction issued in connection
with the case is hereby ordered DISSOLVED.
The Letters Patent No. 14561 issued by the then Philippine Patents Ofce
is hereby declared null and void for being in violation of Sections 7, 9 and
15 of the Patents Law.
Pursuant to Sec. 46 of the Patents Law, the Director of Bureau of Patents
is hereby directed to cancel Letters Patent No. 14561 issued to the
plaintif and to publish such cancellation in the Ofcial Gazette.
Defendant Tryco Pharmaceutical Corporation is hereby awarded
P330,000.00 actual damages and P100,000.00 attorneys fees as prayed
for in its counterclaim but said amount awarded to defendant is subject
to the lien on correct payment of fling fees.
SO ORDERED. (Underscoring supplied)
On appeal, the Court of Appeals, by Decision of April 21, 1995,10 upheld
the trial courts fnding that private respondent was not liable for any
infringement of the patent of petitioner in light of the latters failure to
show that Albendazole is the same as the compound subject of Letters
Patent No. 14561. Noting petitioners admission of the issuance by the
U.S. of a patent for Albendazole in the name of Smith Kline and French
Laboratories which was petitioners former corporate name, the appellate
court considered the U.S. patent as implying that Albendazole is diferent
from methyl 5 propylthio-2-benzimidazole carbamate. It likewise found
that private respondent was not guilty of deceiving the public by
misrepresenting that Impregon is its product.
The appellate court, however, declared that Letters Patent No. 14561 was
not void as it sustained petitioners explanation that Patent Application
Serial No. 18989 which was fled on October 8, 1976 was a divisional
application of Patent Application Serial No. 17280 fled on June 17, 1975
with the Philippine Patent Ofce, well within one year from petitioners
48
fling on June 19, 1974 of its Foreign Application Priority Data No.
480,646 in the U.S. covering the same compound subject of Patent
Application Serial No. 17280.
Applying Section 17 of the Patent Law, the Court of Appeals thus ruled
that Patent Application Serial No. 18989 was deemed fled on June 17,
1995 or still within one year from the fling of a patent application abroad
in compliance with the one-year rule under Section 15 of the Patent Law.
And it rejected the submission that the compound in Letters Patent No.
14561 was not patentable, citing the jurisprudentially established
presumption that the Patent Ofces determination of patentability is
correct. Finally, it ruled that petitioner established itself to be the one
and the same assignee of the patent notwithstanding changes in its
corporate name. Thus the appellate court disposed:
WHEREFORE, the judgment appealed from is AFFIRMED with the
MODIFICATION that the orders for the nullifcation of Letters Patent No.
14561 and for its cancellation are deleted therefrom.
SO ORDERED.
Petitioners motion for reconsideration of the Court of Appeals decision
having been denied11 the present petition for review on certiorari12 was
fled, assigning as errors the following:
I. THE COURT OF APPEALS GRAVELY ERRED IN NOT FINDING THAT
ALBENDAZOLE, THE ACTIVE INGREDIENT IN TRYCOS "IMPREGON"
DRUG, IS INCLUDED IN PETITIONERS LETTERS PATENT NO. 14561,
AND THAT CONSEQUENTLY TRYCO IS ANSWERABLE FOR PATENT
INFRINGEMENT.
II. THE COURT OF APPEALS GRAVELY ERRED IN AWARDING TO
PRIVATE RESPONDENT TRYCO PHARMA CORPORATION P330,000.00
ACTUAL DAMAGES AND P100,000.00 ATTORNEYS FEES.
Petitioner argues that under the doctrine of equivalents for determining
patent infringement, Albendazole, the active ingredient it alleges was
appropriated by private respondent for its drug Impregon, is
substantially the same as methyl 5 propylthio-2-benzimidazole
carbamate covered by its patent since both of them are meant to combat
49
worm or parasite infestation in animals. It cites the "unrebutted"
testimony of its witness Dr. Godofredo C. Orinion (Dr. Orinion) that the
chemical formula in Letters Patent No. 14561 refers to the compound
Albendazole. Petitioner adds that the two substances substantially do the
same function in substantially the same way to achieve the same results,
thereby making them truly identical. Petitioner thus submits that the
appellate court should have gone beyond the literal wordings used in
Letters Patent No. 14561, beyond merely applying the literal infringement
test, for in spite of the fact that the word Albendazole does not appear in
petitioners letters patent, it has ably shown by evidence its sameness
with methyl 5 propylthio-2-benzimidazole carbamate.
Petitioner likewise points out that its application with the Philippine
Patent Ofce on account of which it was granted Letters Patent No.
14561 was merely a divisional application of a prior application in the U.
S. which granted a patent for Albendazole. Hence, petitioner concludes
that both methyl 5 propylthio-2-benzimidazole carbamate and the U.S.-
patented Albendazole are dependent on each other and mutually
contribute to produce a single result, thereby making Albendazole as
much a part of Letters Patent No. 14561 as the other substance is.
Petitioner concedes in its Sur-Rejoinder13 that although methyl 5
propylthio-2-benzimidazole carbamate is not identical with Albendazole,
the former is an improvement or improved version of the latter thereby
making both substances still substantially the same.
With respect to the award of actual damages in favor of private
respondent in the amount of P330,000.00 representing lost profts,
petitioner assails the same as highly speculative and conjectural, hence,
without basis. It assails too the award of P100,000.00 in attorneys fees
as not falling under any of the instances enumerated by law where
recovery of attorneys fees is allowed.
In its Comment,14 private respondent contends that application of the
doctrine of equivalents would not alter the outcome of the case,
Albendazole and methyl 5 propylthio-2-benzimidazole carbamate being
two diferent compounds with diferent chemical and physical properties.
It stresses that the existence of a separate U.S. patent for Albendazole
indicates that the same and the compound in Letters Patent No. 14561
are diferent from each other; and that since it was on account of a
50
divisional application that the patent for methyl 5 propylthio-2-
benzimidazole carbamate was issued, then, by defnition of a divisional
application, such a compound is just one of several independent
inventions alongside Albendazole under petitioners original patent
application.
As has repeatedly been held, only questions of law may be raised in a
petition for review on certiorari before this Court. Unless the factual
fndings of the appellate court are mistaken, absurd, speculative,
conjectural, conficting, tainted with grave abuse of discretion, or
contrary to the fndings culled by the court of origin,15 this Court does
not review them.
From an examination of the evidence on record, this Court fnds nothing
infrm in the appellate courts conclusions with respect to the principal
issue of whether private respondent committed patent infringement to
the prejudice of petitioner.
The burden of proof to substantiate a charge for patent infringement
rests on the plaintif.16 In the case at bar, petitioners evidence consists
primarily of its Letters Patent No. 14561, and the testimony of Dr.
Orinion, its general manager in the Philippines for its Animal Health
Products Division, by which it sought to show that its patent for the
compound methyl 5 propylthio-2-benzimidazole carbamate also covers
the substance Albendazole.
From a reading of the 9 claims of Letters Patent No. 14561 in relation to
the other portions thereof, no mention is made of the compound
Albendazole. All that the claims disclose are: the covered invention, that
is, the compound methyl 5 propylthio-2-benzimidazole carbamate; the
compounds being anthelmintic but nontoxic for animals or its ability to
destroy parasites without harming the host animals; and the patented
methods, compositions or preparations involving the compound to
maximize its efcacy against certain kinds of parasites infecting specifed
animals.
When the language of its claims is clear and distinct, the patentee is
bound thereby and may not claim anything beyond them.17 And so are
the courts bound which may not add to or detract from the claims
matters not expressed or necessarily implied, nor may they enlarge the
51
patent beyond the scope of that which the inventor claimed and the
patent ofce allowed, even if the patentee may have been entitled to
something more than the words it had chosen would include.18
It bears stressing that the mere absence of the word Albendazole in
Letters Patent No. 14561 is not determinative of Albendazoles non-
inclusion in the claims of the patent. While Albendazole is admittedly a
chemical compound that exists by a name diferent from that covered in
petitioners letters patent, the language of Letter Patent No. 14561 fails to
yield anything at all regarding Albendazole. And no extrinsic evidence
had been adduced to prove that Albendazole inheres in petitioners
patent in spite of its omission therefrom or that the meaning of the
claims of the patent embraces the same.
While petitioner concedes that the mere literal wordings of its patent
cannot establish private respondents infringement, it urges this Court to
apply the doctrine of equivalents.
The doctrine of equivalents provides that an infringement also takes
place when a device appropriates a prior invention by incorporating its
innovative concept and, although with some modifcation and change,
performs substantially the same function in substantially the same way
to achieve substantially the same result.19 Yet again, a scrutiny of
petitioners evidence fails to convince this Court of the substantial
sameness of petitioners patented compound and Albendazole. While both
compounds have the efect of neutralizing parasites in animals, identity
of result does not amount to infringement of patent unless Albendazole
operates in substantially the same way or by substantially the same
means as the patented compound, even though it performs the same
function and achieves the same result.20 In other words, the principle or
mode of operation must be the same or substantially the same.21
The doctrine of equivalents thus requires satisfaction of the function-
means-and-result test, the patentee having the burden to show that all
three components of such equivalency test are met.22
As stated early on, petitioners evidence fails to explain how Albendazole
is in every essential detail identical to methyl 5 propylthio-2-
benzimidazole carbamate. Apart from the fact that Albendazole is an
anthelmintic agent like methyl 5 propylthio-2-benzimidazole carbamate,
52
nothing more is asserted and accordingly substantiated regarding the
method or means by which Albendazole weeds out parasites in animals,
thus giving no information on whether that method is substantially the
same as the manner by which petitioners compound works. The
testimony of Dr. Orinion lends no support to petitioners cause, he not
having been presented or qualifed as an expert witness who has the
knowledge or expertise on the matter of chemical compounds.
As for the concept of divisional applications profered by petitioner, it
comes into play when two or more inventions are claimed in a single
application but are of such a nature that a single patent may not be
issued for them.23 The applicant thus is required "to divide," that is, to
limit the claims to whichever invention he may elect, whereas those
inventions not elected may be made the subject of separate applications
which are called "divisional applications."24 What this only means is that
petitioners methyl 5 propylthio-2-benzimidazole carbamate is an
invention distinct from the other inventions claimed in the original
application divided out, Albendazole being one of those other inventions.
Otherwise, methyl 5 propylthio-2-benzimidazole carbamate would not
have been the subject of a divisional application if a single patent could
have been issued for it as well as Albendazole.1wphi1
The foregoing discussions notwithstanding, this Court does not sustain
the award of actual damages and attorneys fees in favor of private
respondent. The claimed actual damages of P330,000.00 representing
lost profts or revenues incurred by private respondent as a result of the
issuance of the injunction against it, computed at the rate of 30% of its
alleged P100,000.00 monthly gross sales for eleven months, were
supported by the testimonies of private respondents President25 and
Executive Vice-President that the average monthly sale of Impregon was
P100,000.00 and that sales plummeted to zero after the issuance of the
injunction.26 While indemnifcation for actual or compensatory damages
covers not only the loss sufered (damnum emergens) but also profts
which the obligee failed to obtain (lucrum cessans or ganacias
frustradas), it is necessary to prove the actual amount of damages with a
reasonable degree of certainty based on competent proof and on the best
evidence obtainable by the injured party.27 The testimonies of private
respondents ofcers are not the competent proof or best evidence
obtainable to establish its right to actual or compensatory damages for
53
such damages also require presentation of documentary evidence to
substantiate a claim therefor.28
In the same vein, this Court does not sustain the grant by the appellate
court of attorneys fees to private respondent anchored on Article 2208
(2) of the Civil Code, private respondent having been allegedly forced to
litigate as a result of petitioners suit. Even if a claimant is compelled to
litigate with third persons or to incur expenses to protect its rights, still
attorneys fees may not be awarded where no sufcient showing of bad
faith could be refected in a partys persistence in a case other than an
erroneous conviction of the righteousness of his cause.29 There exists no
evidence on record indicating that petitioner was moved by malice in
suing private respondent.
This Court, however, grants private respondent temperate or moderate
damages in the amount of P20,000.00 which it fnds reasonable under
the circumstances, it having sufered some pecuniary loss the amount of
which cannot, from the nature of the case, be established with
certainty.30
WHEREFORE, the assailed decision of the Court of Appeals is hereby
AFFIRMED with MODIFICATION. The award of actual or compensatory
damages and attorneys fees to private respondent, Tryco Pharma
Corporation, is DELETED; instead, it is hereby awarded the amount of
P20,000.00 as temperate or moderate damages.
SO ORDERED.
54
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 115106March 15, 1996
ROBERTO L. DEL ROSARIO, petitioner,
vs.
COURT OF APPEALS AND JANITO CORPORATION, respondents.

BELLOSILLO, J.:p
Roberto del Rosario petitions this Court to review the decision of the
Court of Appeals 1 which set aside the order of the Regional Trial Court
of Makati granting a writ of preliminary injunction in his favor.
The antecedents: On 18 January 1993 petitioner fled a complaint for
patent infringement against private respondent Janito Corporation. 2
Roberto L. del Rosario alleged that he was a patentee of an audio
equipment and improved audio equipment commonly known as the sing-
along System or karaoke under Letters Patent No. UM-5269 dated 2 June
1983 as well as Letters Patent No. UM-6237 dated 14 November 1986
issued by the Director of Patents. The efectivity of both Letters Patents
was for fve (5) years and was extended for another fve (5) years starting
2 June 1988 and 14 November 1991, respectively. He described his sing-
along system as a handy multi-purpose compact machine which
incorporates an amplifer speaker, one or two tape mechanisms, optional
tuner or radio and microphone mixer with features to enhance one's
55
voice, such as the echo or reverb to stimulate an opera hall or a studio
sound, with the whole system enclosed in one cabinet casing.
In the early part of 1990 petitioner learned that private respondent was
manufacturing a sing-along system bearing the trademark miyata or
miyata karaoke substantially similar if not identical to the sing-along
system covered by the patents issued in his favor. Thus he sought from
.the trial court the issuance of a writ of preliminary injunction to enjoin
private respondent, its ofcers and everybody elsewhere acting on its
behalf, from using, selling and advertising the miyata or miyata karaoke
brand, the injunction to be made permanent after trial, and praying for
damages, attorney's fees and costs of suit.
On 5 February 1993 the trial court temporarily restrained private
respondent from manufacturing, using and/or selling and advertising
the miyata sing-along system or any sing-along system substantially
identical to the sing-along system patented by petitioner until further
orders.
On 24 February 1993 the trial court issued a writ of preliminary
injunction upon a bond on the basis of its fnding that petitioner was a
holder of a utility model patent for a sing-along system and that without
his approval and consent private respondent was admittedly
manufacturing and selling its own sing-along system under the brand
name miyata which was substantially similar to the patented utility
mode 3 of petitioner.
Private respondent assailed the order of 24 February 1993 directing the
issuance of the writ by way of a petition for certiorari with prayer for the
issuance of a writ of preliminary injunction and a temporary restraining
order before respondent Court of Appeals.
On 15 November 1993 respondent appellate court granted the writ and
set aside the questioned order of the trial court. It expressed the view
that there was no infringement of the patents of petitioner by the fact
alone that private respondent had manufactured the miyata karaoke or
audio system, and that the karaoke system was a universal product
manufactured, advertised and marketed in most countries of the world
long before the patents were issued to petitioner. The motion to
56
reconsider the grant of the writ was denied; 4 hence, the instant petition
for review.
This petition alleges that: (a) it was improper for the Court of Appeals to
consider questions of fact in a certiorari proceeding; (b) the Court of
Appeals erred in taking judicial notice of private respondent's self-serving
presentation of facts; (c) the Court of Appeals erred in disregarding the
fndings of fact of the trial court; and, (d) there was no basis for the
Court of Appeals to grant a writ of preliminary injunction in favor of
private respondent. 5
Petitioner argues that in a certiorari proceeding questions of fact are not
generally permitted the inquiry being limited essentially to whether the
tribunal has acted without or in excess of jurisdiction or with grave
abuse of discretion; that respondent court should not have disturbed but
respected instead the factual fndings of the trial court; that the movant
has a clear legal right to be protected and that there is a violation of such
right by private respondent. Thus, petitioner herein claims, he has
satisfed the legal requisites to justify the order of the trial court directing
the issuance of the writ of injunction. On the other hand, in the absence
of a patent to justify the manufacture and sale by private respondent of
sing-along systems, it is not entitled to the injunctive relief granted by
respondent appellate court.
The crux of the controversy before us hinges on whether respondent
Court of Appeals erred in fnding the trial court to have committed grave
abuse of discretion in enjoining private respondent from manufacturing,
selling and advertising the miyata karaoke brand sing-along system for
being substantially similar if not identical to the audio equipment
covered by letters patent issued to petitioner.
Injunction is a preservative remedy for the protection of substantive
rights or interests. It is not a cause of action in itself but merely a
provisional remedy, an adjunct to a main suit. The controlling reason for
the existence of the judicial power to issue the writ is that the court may
thereby prevent a threatened or continuous irremediable injury to some
of the parties before their claims can be thoroughly investigated and
advisedly adjudicated. It is to be resorted to only when there is a pressing
necessity to avoid injurious consequences which cannot be remedied
under any standard of compensation. The application of the writ rests
57
upon an alleged existence of an emergency or of a special reason for such
an order before the case can be regularly heard, and the essential
conditions for granting such temporary injunctive relief are that the
complaint alleges facts which appear to be sufcient to constitute a
cause of action for injunction and that on the entire showing from both
sides, it appears, in view of all the circumstances, that the injunction is
reasonably necessary to protect the legal rights of plaintif pending the
litigation. 6
A preliminary injunction may be granted at any time after the
commencement of the action and before judgment when it is established
that the defendant is doing, threatens, or is about to do, or is procuring
or sufering to be done, some act probably in violation of the plaintif's
rights. Thus, there are only two requisites to be satisfed if an injunction
is to issue, namely, the existence of the right to be protected, and that
the facts against which the injunction is to be directed are violative of
said right. 7
For the writ to issue the interest of petitioner in the controversy or the
right he seeks to be protected must be a present right, a legal right which
must be shown to be clear and positive.
In this regard Sec. 55 of R.A. 165 as amended, known as The Patent Law,
provides
Sec. 55. Design patents and patents for utility models. (a) Any new,
original, and ornamental design for an article of manufacture and (b)
new model or implements or tools or of any industrial product or of part
of the same, which does not possess the quality of invention but which is
of practical utility by reason of its form, confguration, construction or
composition, may be protected by the author thereof, the former by a
patent for a design and the latter by a patent for a utility model, in the
same manner and subject to the same provisions and requirements as
relate to patents for inventions insofar as they are applicable, except as
otherwise herein provide . . . .
Admittedly, petitioner is a holder of Letters Patent No. UM-5629 dated 2
June 1985 issued for a term of fve (5) years from the grant of a Utility
Model herein described
58
The construction of an audio equipment comprising a substantially
cubical casing having a window at its rear and upper corner ftted with a
slightly inclined control panel, said cubical (casing) having a vertical
partition wall therein defning a rear compartment and a front
compartment, and said front compartment serving as a speaker bafe; a
transistorized amplifer circuit having an echo section and writhed in at
least the printed circuit boards placed inside said rear compartment of
said casing and attached to said vertical partition wall, said
transistorized amplifer circuit capable of being operated from outside,
through various controls mounted on said control panel of such casing; a
loud speaker ftted inside said front compartment of said casing and
connected to the output of the main audio amplifer section of said
transistorized amplifer circuit and a tape player mounted on the top wall
of said casing and said tape player being connected in conventional
manner to said transistorized amplifer circuit. 8
Again, on 14 November 1986 petitioner was granted Letters Patent No.
UM-6237 for a term of fve (5) years from the grant of a Utility Model
described as
In an audio equipment consisting of a frst cubical casing having an
opening at its rear and upper rear portion and a partition therein
forming a rear compartment and a front compartment serving as a loud
speaker bafe, a control panel formed by vertical and horizontal sections,
a transistorized amplifer circuit wired in at least two printed circuit
boards attached at the back of said control panel, a frst loud speaker
ftted inside said frst compartment of such frst casing and connected to
the output of said transistorized amplifer circuit; the improvement
wherein said control panel being removably ftted to said frst cubical
casing and further comprises a set of tape recorder and tape player
mounted on the vertical section of said control panel and said recorder
and player are likewise connected to said transistorized amplifer circuit;
a second cubical casing having an opening at its rear, said second
cubical casing having (being?) provided with a vertical partition therein
defning a rear compartment and a front compartment, said rear
compartment being provided with a door and enclosing therein a set of
tape racks and said front compartment serving as loud speaker bafe,
said second cubical casing being adapted to said frst cubical casing so
that said frst and second casings are secured together in compact and
portable form; and a second loud speaker ftted inside said front
59
compartment of said casing and connected to the output of said amplifer
circuit. 9
The terms of both Letters Patents were extended for another fve (5) years
each, the frst beginning 2 June 1988 and the second, 14 November
1991.
The Patent Law expressly acknowledges that any new model of
implements or tools of any industrial product even if not possessed of the
quality of invention but which is of practical utility is entitled to a patent
for utility model. 10 Here, there is no dispute that the letters patent
issued to petitioner are for utility models of audio equipment.
In issuing, reissuing or withholding patents and extensions thereof, the
Director of Patents determines whether the patent is new and whether
the machine or device is the proper subject of patent. In passing on an
application, the Director decides not only questions of law but also
questions of fact, i.e. whether there has been a prior public use or sale of
the article sought to be patented. 11 Where petitioner introduces the
patent in evidence, if it is in due form, it afords a prima facie
presumption of its correctness and validity. The decision of the Director
of Patents in granting the patent is always presumed to be correct, and
the burden then shifts to respondent to overcome this presumption by
competent evidence. 12
Under Sec. 55 of The Patent Law a utility model shall not be considered
"new" if before the application for a patent it has been publicly known or
publicly used in this country or has been described in a printed
publication or publications circulated within the country, or if it is
substantially similar to any other utility model so known, used or
described within the country. Respondent corporation failed to present
before the trial court competent evidence that the utility models covered
by the Letters Patents issued to petitioner were not new. This is evident
from the testimony of Janito Cua, President of respondent Janito
Corporation, during the hearing on the issuance of the injunction, to wit

Q. Mr. Cua, you testifed that there are (sic) so many other companies
which already have (sic) the sing-along system even before the patent
60
application of Mr. del Rosario and as a matter of fact you mentioned
Sanyo, Sony and Sharp, is that right?
A. Musicmate and Asahi.
Q. Now do you recall that your lawyer fled with this Honorable Court
an Urgent Motion to Lift Temporary Restraining Order of this Honorable
Court. I am sure you were the one who provided him with the
information about the many other companies selling the sing-along
system, is that right? These 18 which you enumerated here.
A. More than that because. . . .
Q. Now you will agree with me that in your statement Sharp you put
the date as 1985 agreed?
A. No.
Q. You mean your lawyer was wrong when he put the word Sharp
1985?
A. Maybe I informed him already.
xxx xxx xxx
Q. You mean your lawyer was wrong in alleging to this Court that
Sharp manufactured and sold (in) 1985 as found in the Urgent Motion?
A. Since it is urgent it is more or less.
Q. The same also with Sanyo 1985 which you put, more or less?
A. Sanyo is wrong.
Q. It is not 1985?
A. Sanyo is 1979 I think.
Q. So this is also wrong. Panasonic 1986 is also wrong?
61
A. Panasonic I think.
Q. So you don't think this is also correct.
A. The date?
Q. So you don't think also that this allegation here that they
manufactured in 1986 is correct?
A. Wrong. Earlier.
Q. National by Precision Electronic 1986 this is also wrong?
A. I think earlier.
Q. So that means all your allegations here from 2 to 5 are wrong? OK.
By Philipps Philippines 1986, this is also correct or wrong?
A. More or less. We said more or less.
Q. Nakabutshi by Asahi Electronics that is also wrong?
A. No that is 1979.
Q. Electone by DICO 1989 is this correct or wrong?
A. Correct. More or less.
Q. Skylers 1985 is that correct or wrong?
A. It is more or less because it is urgent. We don't have time to exact
the date.
Q. Musicmate of G.A. Yupangco 1981 this is more or less? You are not
also sure?
A. 95% sure.
Q. Now you are sure 1981.
62
A. This one because. . . .
Q. Mr. Witness so you are now trying to tell this Honorable Court that
all your allegations here of the dates in this Urgent Motion except for
Musicmate which you are only 95% sure they are all wrong or they are
also more or less or not sure, is that right?
A. More or less.
Q. Now do you have any proof, any advertisement, anything in writing
that would show that all these instruments are in the market, do you
have it.
A. No I don't have it because. . . .
Q. No I am satisfed with your answer. Now Mr. Witness, you don't
also have a proof that Akai instrument that you said was also in the
market before 1982? You don't have any written proof, any
advertisement?
A. I have the product.
Q. But you have not brought the product in (sic) this Honorable
Court, right?
A. No. 13
As may be gleaned herein, the rights of petitioner as a patentee have
been sufciently established, contrary to the fndings and conclusions of
respondent Court of Appeals. Consequently, under Sec. 37 of The Patent
law, petitioner as a patentee shall have the exclusive right to make, use
and sell the patented machine, article or product for the purpose of
industry or commerce, throughout the territory of the Philippines for the
term of the patent, and such making, using or selling by any person
without authorization of the patentee constitutes infringement of his
patent.
Petitioner established before the trial court that respondent Janito
Corporation was manufacturing a similar sing-along system bearing the
trademark miyata which infringed his patented models. He also alleged
63
that both his own patented audio equipment and respondent's sing-along
system were constructed in a casing with a control panel, the casing
having a vertical partition wall defning the rear compartment from the
front compartment, with the front compartment consisting of a loud
speaker bafe, both containing a transistorized amplifer circuit capable
of being operated from outside through various controls mounted on the
control panel, and that both had loud speakers ftted inside the front
compartment of the casing and connected to the output of the main
audio amplifer section both having a tape recorder and a tape player
mounted on the control panel with the tape recorder and tape player
being both connected to the transistorized amplifer circuit. 14
Respondent Janito Corporation denied that there was any violation of
petitioner's patent rights, and cited the diferences between its miyata
equipment and petitioner's audio equipment. But, it must be
emphasized, respondent only confned its comparison to the frst model,
Utility Model No. 5269, and completely disregarded Utility Model No.
6237 which improved on the frst. As described by respondent
corporation, 15 these diferences are
First.Under Utility Model 5269, the unit is a substantially cubical casing
with a window at its rear and upper corner ftted with slightly inclined
control panel, while the miyata equipment is a substantially rectangular
casing with panel vertically positioned.
Second. Under Utility Model 5269, the cubical casing has a vertical
partition wall defning a rear compartment and a front compartment
serving as a speaker bafe, while the miyata equipment has no rear
compartment and front compartment in its rectangular casing; it has
only a front compartment horizontally divided into 3 compartments like a
3-storey building, the 1st compartment being a kit, the 2nd also the
speaker, and the 3rd are kits.
Third.Under Utility Model No. 5269, a transistorized amplifer circuit
with an echo section wired in at least 2 printed circuit boards is placed
inside the rear compartment of the casing and attached to the vertical
partition wall, the printed circuit board having 1 amplifer and 1 echo,
while in the miyata equipment the amplifer is mainly IC (Integrated
Circuit) powered with 8 printed circuit boards almost all of which are
IC controlled, with 1 amplifer with power supply, 1 main tuner, 1
64
equalizer (3-band), 1 IC controlled volume control, 1 echo IC, 1 tape
pream, 1 instrument and 1 wireless microphone.
Fourth. Under Utility Model 5269, 4 printed circuits are placed
inside the compartment of its casing attached to the vertical partition
wall, while in the miyata, the 7 printed circuit boards (PCB) are attached
to the front panel and 1 attached to the horizontal divider.
Fifth.Under Utility Model 5269, there are various controls mounted on
the control panel of the casing, while in miyata, the various controls are
all separated from the printed circuit boards and the various controls are
all attached thereto.
Sixth.Under Utility Model 5269, a loud speaker ftted inside the front
compartment of the casing is connected to the output of the main audio
amplifer section of the transistorized amplifer circuit, while in miyata,
there is no other way but to use 2 loud speakers connected to the
amplifer.
Seventh. Under Utility Model 5269, a tape player is mounted on the
top wall of the casing, while in miyata, 2 tape players are used mounted
side by side at the front.
It is elementary that a patent may be infringed where the essential or
substantial features of the patented invention are taken or appropriated,
or the device, machine or other subject matter alleged to infringe is
substantially identical with the patented invention. In order to infringe a
patent, a machine or device must perform the same function, or
accomplish the same result by identical or substantially identical means
and the principle or mode of operation must be substantially the same.
16
It may be noted that respondent corporation failed to present before the
trial court a clear, competent and reliable comparison between its own
model and that of petitioner, and disregarded completely petitioner's
utility Model No. 6237 which improved on his frst patented model.
Notwithstanding the diferences cited by respondent corporation, it did
not refute and disprove the allegations of petitioner before the trial court
that: (a) both are used by a singer to sing and amplify his voice; (b) both
are used to sing with a minus-one or multiplex tapes, or that both are
65
used to play minus-one or standard cassette tapes for singing or for
listening to; (c) both are used to sing with a minus-one tape and
multiplex tape and to record the singing and the accompaniment; (d)
both are used to sing with live accompaniment and to record the same;
(e) both are used to enhance the voice of the singer using echo efect,
treble, bass and other controls; (g) both are equipped with cassette tape
decks which are installed with one being used for playback and the other,
for recording the singer and the accompaniment, and both may also be
used to record a speaker's voice or instrumental playing, like the guitar
and other instruments; (h) both are
encased in a box-like cabinets; and, (i) both can be used with one or
more microphones. 17
Clearly, therefore, both petitioner's and respondent's models involve
substantially the same modes of operation and produce substantially the
same if not identical results when used.
In view thereof, we fnd that petitioner had established before the trial
court prima facie proof of violation of his rights as patentee to justify the
issuance of a writ of preliminary injunction in his favor during the
pendency of the main suit for damages resulting from the alleged
infringement.
WHEREFORE, the Decision of the Court of Appeals dated 15 November
1993 is REVERSED and SET ASIDE and the Order of the trial court
dated 24 February 1993 granting petitioner the writ of injunction is
REINSTATED.
The trial court is directed to continue with the proceedings on the main
action pending before it in order to resolve with dispatch the issues
therein presented.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 97343 September 13, 1993
66
PASCUAL GODINES, petitioner,
vs.
THE HONORABLE COURT OF APPEALS, SPECIAL FOURTH DIVISION
and SV-AGRO ENTERPRISES, INC., respondents.
Jesus S. Anonat for petitioner.
Arturo M. Alinio for private respondent.
ROMERO, J.:
Through this petition for review in certiorari of a decision of the Court of
Appeals afrming the decision of the trial court, petitioner Pascual
Godines seeks to reverse the adverse decision of the Court a quo that he
was liable for infringement of patent and unfair competition. The
dispositive portion of the assailed decision is hereby quoted to wit:
WHEREFORE, with the elimination of the award for attorney's fees, the
judgment appealed from is hereby AFFIRMED, with costs against
appellant. 1
The patent involved in this case is Letters Patent No. UM-2236 issued by
the Philippine Patent Ofce to one Magdalena S. Villaruz on July 15,
1976. It covers a utility model for a hand tractor or power tiller, the main
components of which are the following: "(1) a vacuumatic house foat; (2)
a harrow with adjustable operating handle; (3) a pair of paddy wheels; (4)
a protective water covering for the engine main drive; (5) a transmission
case; (6) an operating handle; (7) an engine foundation on the top
midportion of the vacuumatic housing foat to which the main engine
drive is detachedly installed; (8) a frontal frame extension above the
quarter circularly shaped water covering hold (sic) in place the
transmission case; (9) a V-belt connection to the engine main drive with
transmission gear through the pulley, and (10) an idler pulley installed
on the engine foundation." 2 The patented hand tractor works in the
following manner: "the engine drives the transmission gear thru the V-
belt, a driven pulley and a transmission shaft. The engine drives the
transmission gear by tensioning of the V-belt which is controlled by the
idler pulley. The V-belt drives the pulley attached to the transmission
67
gear which in turn drives the shaft where the paddy wheels are attached.
The operator handles the hand tractor through a handle which is
inclined upwardly and supported by a pair of substanding pipes and
reinforced by a U-shaped G.I. pipe at the V-shaped end." 3
The above mentioned patent was acquired by SV-Agro Industries
Enterprises, Inc., herein private respondent, from Magdalena Villaruz, its
chairman and president, by virtue of a Deed of Assignment executed by
the latter in its favor. On October 31, 1979, SV-Agro Industries caused
the publication of the patent in Bulletin Today, a newspaper of general
circulation.
In accordance with the patent, private respondent manufactured and
sold the patented power tillers with the patent imprinted on them. In
1979, SV-Agro Industries sufered a decline of more than 50% in sales in
its Molave, Zamboanga del Sur branch. Upon investigation, it discovered
that power tillers similar to those patented by private respondent were
being manufactured and sold by petitioner herein. Consequently, private
respondent notifed Pascual Godines about the existing patent and
demanded that the latter stop selling and manufacturing similar power
tillers. Upon petitioner's failure to comply with the demand, SV-Agro
Industries fled before the Regional Trial Court a complaint for
infringement of patent and unfair competition.
After trial, the court held Pascual Godines liable for infringement of
patent and unfair competition. The dispositive portion of the decision
reads as follows:
WHEREFORE, premises considered, JUDGMENT is hereby rendered in
favor of the plaintif SV-Agro Industries Enterprises, Inc., and against
defendant Pascual Godines:
1. Declaring the writ of preliminary injunction issued by this Court
against defendant as permanent;
2. Ordering defendant Pascual Godines to pay plaintif the sum of
Fifty Thousand Pesos (P50,000.00) as damages to its business reputation
and goodwill, plus the further sum of Eighty Thousand Pesos
(P80,000.00) for unrealized profts during the period defendant was
manufacturing and selling copied or imitation foating power tiller;
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3. Ordering the defendant to pay the plaintif, the further sum of
Eight Thousand Pesos (P8,000.00) as reimbursement of attorney's fees
and other expenses of litigation; and to pay the costs of the suit.
SO ORDERED. 4
The decision was afrmed by the appellate court.
Thereafter, this petition was fled. Petitioner maintains the defenses
which he raised before the trial and appellate courts, to wit: that he was
not engaged in the manufacture and sale of the power tillers as he made
them only upon the special order of his customers who gave their own
specifcations; hence, he could not be liable for infringement of patent
and unfair competition; and that those made by him were diferent from
those being manufactured and sold by private respondent.
We fnd no merit in his arguments. The question of whether petitioner
was manufacturing and selling power tillers is a question of fact better
addressed to the lower courts. In dismissing the frst argument of
petitioner herein, the Court of Appeals quoted the fndings of the court,
to wit:
It is the contention of defendant that he did not manufacture or make
imitations or copies of plaintif's turtle power tiller as what he merely did
was to fabricate his foating power tiller upon specifcations and designs
of those who ordered them. However, this contention appears untenable
in the light of the following circumstances: 1) he admits in his Answer
that he has been manufacturing power tillers or hand tractors, selling
and distributing them long before plaintif started selling its turtle power
tiller in Zamboanga del Sur and Misamis Occidental, meaning that
defendant is principally a manufacturer of power tillers, not upon
specifcation and design of buyers, but upon his own specifcation and
design; 2) it would be unbelievable that defendant would fabricate power
tillers similar to the turtle power tillers of plaintif upon specifcations of
buyers without requiring a job order where the specifcation and designs
of those ordered are specifed. No document was (sic) ever been presented
showing such job orders, and it is rather unusual for defendant to
manufacture something without the specifcation and designs,
considering that he is an engineer by profession and proprietor of the
69
Ozamis Engineering shop. On the other hand, it is also highly unusual
for buyers to order the fabrication of a power tiller or hand tractor and
allow defendant to manufacture them merely based on their verbal
instructions. This is contrary to the usual business and manufacturing
practice. This is not only time consuming, but costly because it involves a
trial and error method, repeat jobs and material wastage. Defendant
judicially admitted two (2) units of the turtle power tiller sold by him to
Policarpio Berondo. 5
Of general acceptance is the rule imbedded in our jurisprudence that
". . . the jurisdiction of the Supreme Court in cases brought to it from the
Court of Appeals in a petition for certiorari under Rule 45 of the Rules of
Court is limited to the review of errors of law, and that said appellate
court's fndings of fact are conclusive upon this Court." 6
The fact that petitioner herein manufactured and sold power tillers
without patentee's authority has been established by the courts despite
petitioner's claims to the contrary.
The question now arises: Did petitioner's product infringe upon the
patent of private respondent?
Tests have been established to determine infringement. These are (a)
literal infringement; and (b) the doctrine of equivalents. 7 In using literal
infringement as a test, ". . . resort must be had, in the frst instance, to
the words of the claim. If accused matter clearly falls within the claim,
infringement is made out and that is the end of it." 8 To determine
whether the particular item falls within the literal meaning of the patent
claims, the court must juxtapose the claims of the patent and the
accused product within the overall context of the claims and
specifcations, to determine whether there is exact identity of all material
elements. 9
The trial court made the following observation:
Samples of the defendant's foating power tiller have been produced and
inspected by the court and compared with that of the turtle power tiller
of the plaintif (see Exhibits H to H-28). In appearance and form, both
the foating power tillers of the defendant and the turtle power tiller of
the plaintif are virtually the same. Defendant admitted to the Court that
70
two (2) of the power inspected on March 12, 1984, were manufactured
and sold by him (see TSN, March 12, 1984, p. 7). The three power tillers
were placed alongside with each other. At the center was the turtle power
tiller of plaintif, and on both sides thereof were the foating power tillers
of defendant (Exhibits H to H-2). Witness Rodrigo took photographs of
the same power tillers (front, side, top and back views for purposes of
comparison (see Exhibits H-4 to H-28). Viewed from any perspective or
angle, the power tiller of the defendant is identical and similar to that of
the turtle power tiller of plaintif in form, confguration, design and
appearance. The parts or components thereof are virtually the same.
Both have the circularly-shaped vacuumatic housing foat, a paddy in
front, a protective water covering, a transmission box housing the
transmission gears, a handle which is V-shaped and inclined upwardly,
attached to the side of the vacuumatic housing foat and supported by
the upstanding G.I. pipes and an engine base at the top midportion of
the vacuumatic housing foat to which the engine drive may be attached.
In operation, the foating power tiller of the defendant operates also in
similar manner as the turtle power tiller of plaintif. This was admitted
by the defendant himself in court that they are operating on the same
principles. (TSN, August 19, 1987, p. 13) 10
Moreover, it is also observed that petitioner also called his power tiller as
a foating power tiller. The patent issued by the Patent Ofce referred to a
"farm implement but more particularly to a turtle hand tractor having a
vacuumatic housing foat on which the engine drive is held in place, the
operating handle, the harrow housing with its operating handle and the
paddy wheel protective covering." 11 It appears from the foregoing
observation of the trial court that these claims of the patent and the
features of the patented utility model were copied by petitioner. We are
compelled to arrive at no other conclusion but that there was
infringement.
Petitioner's argument that his power tillers were diferent from private
respondent's is that of a drowning man clutching at straws.
Recognizing that the logical fallback position of one in the place of
defendant is to aver that his product is diferent from the patented one,
courts have adopted the doctrine of equivalents which recognizes that
minor modifcations in a patented invention are sufcient to put the item
beyond the scope of literal infringement. 12 Thus, according to this
71
doctrine, "(a)n infringement also occurs when a device appropriates a
prior invention by incorporating its innovative concept and, albeit with
some modifcation and change, performs substantially the same function
in substantially the same way to achieve substantially the same result."
13 The reason for the doctrine of equivalents is that to permit the
imitation of a patented invention which does not copy any literal detail
would be to convert the protection of the patent grant into a hollow and
useless thing. Such imitation would leave room for indeed encourage
the unscrupulous copyist to make unimportant and insubstantial
changes and substitutions in the patent which, though adding nothing,
would be enough to take the copied matter outside the claim, and hence
outside the reach of the law. 14
In this case, the trial court observed:
Defendant's witness Eduardo Caete, employed for 11 years as welder of
the Ozamis Engineering, and therefore actually involved in the making of
the foating power tillers of defendant tried to explain the diference
between the foating power tillers made by the defendant. But a careful
examination between the two power tillers will show that they will
operate on the same fundamental principles. And, according to establish
jurisprudence, in infringement of patent, similarities or diferences are to
be determined, not by the names of things, but in the light of what
elements do, and substantial, rather than technical, identity in the test.
More specifcally, it is necessary and sufcient to constitute equivalency
that the same function can be performed in substantially the same way
or manner, or by the same or substantially the same, principle or mode
of operation; but where these tests are satisfed, mere diferences of form
or name are immaterial. . . . 15
It also stated:
To establish an infringement, it is not essential to show that the
defendant adopted the device or process in every particular; Proof of an
adoption of the substance of the thing will be sufcient. "In one sense,"
said Justice Brown, "it may be said that no device can be adjudged an
infringement that does not substantially correspond with the patent. But
another construction, which would limit these words to exact mechanism
described in the patent, would be so obviously unjust that no court could
be expected to adopt it. . . .
72
The law will protect a patentee against imitation of his patent by other
forms and proportions. If two devices do the same work in substantially
the same way, and accomplish substantially the same result, they are the
same, even though they difer in name, form, or shape. 16
We pronounce petitioner liable for infringement in accordance with
Section 37 of Republic Act No. 165, as amended, providing, inter alia:
Sec. 37. Right of Patentees. A patentee shall have the exclusive
right to make, use and sell the patented machine, article or product, and
to use the patented process for the purpose of industry or commerce,
throughout the territory of the Philippines for the terms of the patent;
and such making, using, or selling by any person without the
authorization of the Patentee constitutes infringement of the patent.
(Emphasis ours)
As far as the issue regarding unfair competition is concerned, sufce it to
say that Republic Act No. 166, as amended, provides, inter alia:
Sec. 29. Unfair competition, rights and remedies. . . .
xxx xxx xxx
In particular, and without in any way limiting the scope of unfair
competition, the following shall be deemed guilty of unfair competition:
(a) Any person, who in selling his goods shall give them the general
appearance of goods of another manufacturer or dealer, either as to the
goods themselves or in the wrapping of the packages in which they are
contained, or the devices or words thereon, or in any other feature of
their appearance, which would be likely to infuence purchasers that the
goods ofered are those of a manufacturer or dealer other than the actual
manufacturer or dealer, or who otherwise clothes the goods with such
appearance as shall deceive the public and defraud another of his
legitimate trade. . . .
xxx xxx xxx
73
Considering the foregoing, we fnd no reversible error in the decision of
the Court of Appeals afrming with modifcation the decision of the trial
court.
WHEREFORE, premises considered, the decision of the Court of Appeals
is hereby AFFIRMED and this petition DENIED for lack of merit.
74