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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

TAKE NOTE:
Red font color: From the discussion of Atty.
Blue font color: From the book
Violet font color: From the cases
ITALICS - Amendments

3. Importance of Adopting
Intellectual Property Rights
NOTES:
Purpose for adopting the law

protecting

PRIMARY PURPOSE: promote the diffusion of knowledge


and information for the promotion of national development
and progress and the common good

INTELLECTUAL PROPERTY LAW


I.

Laws

INTRODUCTION
- The law bears in itself a SOCIAL FUNCTION

NOTES:
Three Major Domains/Subjects of IPL:
1. Copy right literary/artistic works; for the purpose of
distribution (books)
2. Patent for inventionmostly in the fields of science &
technology
3. Trademark any mark capable of establishing goods &
services; for product
1. Basis of the Intellectual Property law (R.A.
8293, as amendedIntellectual Property
Code)

Embodied several laws in one instrument


Took effect Jan. 1, 1998
However, there are prior laws dealing with
these subjects
CopyrightPD 49
PatentRA 165
Trademark RA 166

Amended the following Sections of RA


No. 8203: Secs. 112, 113, 114, 116, 117,
119 and 120 under Chapter XIII
Republic Act No. 9502 (2008)

Amended the following Sections of RA


No. 8203: Secs. 22, 26, 72, 74.3 & 74.4,
76.1, 93 (a new Section inserted: Sec. 93A),
94, 95, 147, 159

Q: Why is it important to determine the objective?


A: in order for us to be guided with the manner of
interpreting indirect or ambiguous provisions of the said
law
4. Philippine commitment to the GATT-TRIPS
agreement
NOTES:
Article 14, Section 13. The State shall protect and secure
the exclusive rights of scientists, inventors, artists, and
other gifted citizens to their intellectual property and
creations, particularly when beneficial to the people, for
such period as may be provided by law.
* What is the nature of his right of the author?-characterized as exclusive rightOnly he can exercise
his right, to the exclusion of others.

2. Amendments to R.A. 8293:


Republic Act No. 9150 (2001)

SECONDARY PURPOSE: It shall protect and secure the


exclusive rights of scientists, inventors, artists and other
gifted citizens to their intellectual property and creations,
particularly when beneficial to the people, for such periods
as provided in this Act. (must be subservient to the primary
purposes

Republic Act No. 10372 (2013)

Amended the following Sections of RA


No. 8203: Secs. 6,7, (a new Section is inserted:
Sec. 9A), 171.3, 171.9, (two new
subsection added
at the end of Sec.
171.11: Section 171.12 and
171.13), The Chapter Title of Chapter VII, Part IV, The
Law on Copyright amended to: Chapter
VII
Transfer, Assignment & Licensing of Copyright),
Amended: Secs. 180, 181
183, 184,1, 185.1, 188.1,
(deleted in its entirety: 190.1 & 190.2), (190.3
renumbered & amended as the sole
provision
under Sec. 190) 191, 198, 203, 208, 212, 216, 217.2,
218.1, (Section 220A inserted after Sec. 220.2 ), 226,
(Sec. 230
renumbered to Sec. 231)
- Additional legislation relating to IP Rights:
Republic Act No. 10055 (2010)

World Trade Organization


If we dont have stringent policies and laws, foreign
investors will not be confident enough that their rights will
be adequately protected thus wont invest. This in turn lead
to the imperative need to enter to the General Agreement
on Tariff and Trades (embodies a lot of sub agreements)
Trade-Related Aspects of Intellectual Property Rights
(GATT-TRIPS)
CASE:
Tanada vs. Angara G.R. No. 118295, May 2,
1997
GATT-TRIPS contain regulations violative of our
constitution (ex. Violative of Filipino first Policy).
The GATT-TRIP must follow the most favored
nation principle stating that the Philippines being a
member of international agreement shall afford
other signatories same right and privileges with
other Filipinos. SC said that it is not
unconstitutional or repugnant to the first Filipino
policy, because that provision is not self-executing
provision, thus there should be a legislative
enactment to enforce such law. Hence there is no
course of action. Further the Philippines cannot
adopt an isolated policy because of the rapid
global change. With GAPIL, it become part of
Municipal Laws.

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

5. Did RA 8293 repeal


Intellectual Property?

existing

laws

CASES:
Mirpuri vs. CA (G.R. No. 114508, Nov. 19, 1999)
FACTS:
In 1970, Escobar filed an application with the
Bureau of Patents for the registration of the
trademark Barbizon for use in horsiers and
ladies undergarments (IPC No. 686). Private
respondent reported Barbizon Corporation, a
corporation organized and doing business under
the laws of New York, USA, opposed the
application. It was alleged that its trademark is
confusingly similar with that of Escobar and that
the registration of the said trademark will cause
damage to its business reputation and goodwill. In
1974, the Director of Patents gave due course to
the application.
Escobar later assigned all his rights and interest
over the trademark to petitioner. In 1979, Escobar
failed to file with the Bureau the affidavit of use of
the trademark required under the Philippine
Trademark Law. Due to this failure, the Bureau
cancelled Escobars certificate of registration. In
1981, Escobar and petitioner separately filed this
application for registration of the same trademark.
(IPC 2049). Private respondent opposed again.
This time it alleged (1) that the said trademark
was registered with the US Patent Office; (2) that
it is entitled to protection as well-known mark
under Article 6 bis of the Paris Convention, EO
913 and the two Memoranda of the Minister of
Trade and Industry and (3) that its use on the
same class of goods amounts to a violation of the
Trademark Law and Art. 189 of the RPC.
Petitioner raised the defense of Res Judicata.
HELD: (In relation to the topic)
The Intellectual Property Code of the Philippines
declares that "an effective intellectual and
industrial property system is vital to the
development of domestic and creative activity,
facilitates transfer of technology, it attracts foreign
investments, and ensures market access for our
products." The Intellectual Property Code took
effect on January 1, 1998 and by its express
provision, repealed the Trademark Law, the
Patent Law, Articles 188 and 189 of the
Revised Penal Code, the Decree on Intellectual
Property, 82 and the Decree on Compulsory
Reprinting of Foreign Textbooks. The Code
was enacted to strengthen the intellectual and
industrial property system in the Philippines as
mandated by the country's accession to the
Agreement Establishing the World Trade
Organization (WTO).

Samson vs. Daway (G.R. No. 106654, July 21,


2004)
FACTS: Two informations for unfair competition
under Section 168.3 (a), in relation to Section 170,

on

of the Intellectual Property Code (Republic Act No.


8293), similarly worded save for the dates and
places of commission, were filed against petitioner
Manolo P. Samson, the registered owner of ITTI
Shoes.
The accusatory portion of said
informations read:
xxx owner/proprietor of ITTI Shoes/Mano Shoes
Manufactuirng Corporation located at Robinsons
Galleria, EDSA corner Ortigas Avenue, Quezon
City, did then and there willfully, unlawfully and
feloniously distribute, sell and/or offer for sale
CATERPILLAR products such as footwear,
garments, clothing, bags, accessories and
paraphernalia which are closely identical to and/or
colorable imitations of the authentic Caterpillar
products and likewise using trademarks, symbols
and/or designs as would cause confusion,
mistake or deception on the part of the buying
public to the damage and prejudice of
CATERPILLAR, INC., the prior adopter, user and
owner
of
the
following
internationally:
CATERPILLAR, CAT, CATERPILLAR &
DESIGN, CAT AND DESIGN, WALKING
MACHINES and TRACK-TYPE TRACTOR &
DESIGN.
Petitioner filed a twin motion to quash the
information and motion for reconsideration of the
order denying motion to suspend, this time
challenging the jurisdiction of the trial court over
the offense charged. He contended that since
under Section 170 of R.A. No. 8293, the penalty5
of imprisonment for unfair competition does not
exceed six years, the offense is cognizable by the
Municipal Trial Courts and not by the Regional
Trial Court, per R.A. No. 7691. Trial court denied
petitioners twin motions. A motion for
reconsideration thereof was likewise denied.
Hence, the instant petition alleging that
respondent Judge gravely abused its discretion in
issuing the assailed orders.
ISSUE: Which court has jurisdiction over criminal
and civil cases for violation of intellectual property
rights?
HELD: Under Section 170 of R.A. No. 8293,
which took effect on January 1, 1998, the criminal
penalty for infringement of registered marks, unfair
competition, false designation of origin and false
description or representation, is imprisonment
from 2 to 5 years and a fine ranging from Fifty
Thousand Pesos to Two Hundred Thousand
Pesos, to wit:
SEC. 170. Penalties. Independent of the civil and
administrative sanctions imposed by law, a criminal
penalty of imprisonment from two (2) years to five (5)
years and a fine ranging from Fifty thousand pesos
(P50,000.00) to Two hundred thousand pesos
(P200,000.00), shall be imposed on any person who is
found guilty of committing any of the acts mentioned in
Section 155 [Infringement], Section 168 [Unfair
Competition] and Section 169.1 [False Designation of
Origin and False Description or Representation].

Corollarily, Section 163 of the same Code states


that actions (including criminal and civil) under
Sections 150, 155, 164, 166, 167, 168 and 169
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

shall be brought before the proper courts with


appropriate jurisdiction under existing laws, thus
SEC. 163. Jurisdiction of Court. All actions under
Sections 150, 155, 164 and 166 to 169 shall be brought
before the proper courts with appropriate jurisdiction
under existing laws. (Emphasis supplied)

The existing law referred to in the foregoing


provision is Section 27 of R.A. No. 166 (The
Trademark Law) which provides that jurisdiction
over cases for infringement of registered marks,
unfair competition, false designation of origin and
false description or representation, is lodged with
the Court of First Instance (now Regional Trial
Court)
SEC. 27. Jurisdiction of Court of First Instance. All
actions under this Chapter [V Infringement] and
Chapters VI [Unfair Competition] and VII [False
Designation of Origin and False Description or
Representation], hereof shall be brought before the
Court of First Instance.

We find no merit in the claim of petitioner that


R.A. No. 166 was expressly repealed by R.A.
No. 8293. The repealing clause of R.A. No. 8293,
reads
SEC. 239. Repeals. 239.1. All Acts and parts of Acts
inconsistent herewith, more particularly Republic Act
No. 165, as amended; Republic Act No. 166, as
amended; and Articles 188 and 189 of the Revised
Penal Code; Presidential Decree No. 49, including
Presidential Decree No. 285, as amended, are hereby
repealed. (Emphasis added)

Notably, the aforequoted clause did not


expressly repeal R.A. No. 166 in its entirety,
otherwise, it would not have used the phrases
parts of Acts and inconsistent herewith; and it
would have simply stated Republic Act No. 165,
as amended; Republic Act No. 166, as amended;
and Articles 188 and 189 of the Revised Penal
Code; Presidential Decree No. 49, including
Presidential Decree No. 285, as amended are
hereby repealed. It would have removed all
doubts that said specific laws had been rendered
without force and effect. The use of the phrases
parts of Acts and inconsistent herewith only
means that the repeal pertains only to provisions
which are repugnant or not susceptible of
harmonization with R.A. No. 8293.7 Section 27 of
R.A. No. 166, however, is consistent and in
harmony with Section 163 of R.A. No. 8293. Had
R.A. No. 8293 intended to vest jurisdiction over
violations of intellectual property rights with the
Metropolitan Trial Courts, it would have expressly
stated so under Section 163 thereof.
Moreover, the settled rule in statutory construction
is that in case of conflict between a general law
and a special law, the latter must prevail.
Jurisdiction conferred by a special law to Regional
Trial Courts must prevail over that granted by a
general law to Municipal Trial Courts.
In the case at bar, R.A. No. 8293 and R.A. No.
166 are special laws conferring jurisdiction over
violations of intellectual property rights to the
Regional Trial Court.
They should therefore

prevail over R.A. No. 7691, which is a general law.


Hence, jurisdiction over the instant criminal case
for unfair competition is properly lodged with the
Regional Trial Court even if the penalty therefor is
imprisonment of less than 6 years, or from 2 to 5
years and a fine ranging from P50,000.00 to
P200,000.00.
The case of Mirpuri v. Court of Appeals, invoked
by petitioner finds no application in the present
case. Nowhere in Mirpuri did we state that
Section 27 of R.A. No. 166 was repealed by R.A.
No. 8293. Neither did we make a categorical
ruling therein that jurisdiction over cases for
violation of intellectual property rights is lodged
with the Municipal Trial Courts. The passing
remark in Mirpuri on the repeal of R.A. No. 166 by
R.A. No. 8293 was merely a backgrounder to the
enactment of the present Intellectual Property
Code and cannot thus be construed as a
jurisdictional pronouncement in cases for violation
of intellectual property rights.

6. Intellectual
Property
Copyright and Patents

RightsTrademark,

Section 4. Definitions. - 4.1. The term "intellectual property


rights" consists of:
a) Copyright and Related Rights;
b) Trademarks and Service Marks;
c) Geographic Indications;
d) Industrial Designs;
e) Patents;
f) Layout-Designs (Topographies) of Integrated Circuits;
and
g) Protection of Undisclosed Information (n, TRIPS).
REPUBLIC ACT NO. 8293INTELLECTUAL
PROPERTY LAW
II. Preliminary Matters
1. State Policy Declaration
Section 2. Declaration of State Policy. - The State
recognizes that an effective intellectual and industrial
property system is vital to the development of domestic
and creative activity, facilitates transfer of technology,
attracts foreign investments, and ensures market access
for our products. It shall protect and secure the exclusive
rights of scientists, inventors, artists and other gifted
citizens to their intellectual property and creations,
particularly when beneficial to the people, for such periods
as provided in this Act.
The use of intellectual property bears a social
function. To this end, the State shall promote the diffusion
of knowledge and information for the promotion of national
development and progress and the common good.
It is also the policy of the State to streamline
administrative
procedures
of
registering
patents,
trademarks and copyright, to liberalize the registration on
the transfer of technology, and to enhance the enforcement
of intellectual property rights in the Philippines. (n)
CASES:
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Twentieth Century Music Corp. vs.


Aiken (422 U.S. 151)

Private respondent also cited protection of the


trademark under the Convention of Paris for the
Protection of Industrial Property, specifically Article
6bis thereof, and the implementation of Article
6bis by two Memoranda dated November 20,
1980 and October 25, 1983 of the Minister of
Trade and Industry to the Director of Patents, as
well as Executive Order (E.O.) No. 913.

FACTS:
ISSUE:
HELD:
Feist Publications Inc. vs. Rural Telephone
Service Co. ( 499 U.S. 340, 1991)
FACTS:
ISSUE:
HELD:
2. Effect on International Conventions and on
Principle of Reciprocity
Section 3. International Conventions and Reciprocity. Any person who is a national or who is domiciled or has a
real and effective industrial establishment in a country
which is a party to any convention, treaty or agreement
relating to intellectual property rights or the repression of
unfair competition, to which the Philippines is also a party,
or extends reciprocal rights to nationals of the Philippines
by law, shall be entitled to benefits to the extent necessary
to give effect to any provision of such convention, treaty or
reciprocal law, in addition to the rights to which any owner
of an intellectual property right is otherwise entitled by this
Act. (n)
Section 231. Reverse Reciprocity of Foreign Laws. - Any
condition, restriction, limitation, diminution, requirement,
penalty or any similar burden imposed by the law of a
foreign country on a Philippine national seeking protection
of intellectual property rights in that country, shall
reciprocally be enforceable upon nationals of said country,
within Philippine jurisdiction. (n)
NOTE:
SECTION 3 - Talks about any person who will benefit the
provisions but with qualifying statements:
I.
either a national
domiciled or
has a real and effective industrial establishment
in a country who is a national of a country which
is party to an international agreement pertaining to
intellectual property rights or the Repression of
Unfair Competition (ex. Berne Convention, Paris
Convention, WIPO Agreement)

II.
If he does not fall under the qualifications
mentioned above, for as long he is a person who is
a national, domicile or has a real and effective
industrial establishment of a country that extends
reciprocal rights to national of the Philippines

CASE:
Mirpuri vs. CA (G.R. No. 114508, Nov. 19, 1999)
Ruling of SC in relation to the topic:

The Convention of Paris for the Protection of


Industrial Property, otherwise known as the Paris
Convention, is a multilateral treaty that seeks to
protect industrial property consisting of patents,
utility models, industrial designs, trademarks,
service marks, trade names and indications of
source or appellations of origin, and at the same
time aims to repress unfair competition. The
Convention is essentially a compact among
various countries which, as members of the
Union, have pledged to accord to citizens of the
other member countries trademark and other
rights comparable to those accorded their own
citizens by their domestic laws for an effective
protection against unfair competition. In short,
foreign nationals are to be given the same
treatment in each of the member countries as
that country makes available to its own
citizens. Nationals of the various member nations
are thus assured of a certain minimum of
international protection of their industrial property.
The Convention was first signed by eleven
countries in Paris on March 20, 1883. It underwent
several revisions at Brussels in 1900, at
Washington in 1911, at The Hague in 1925, at
London in 1934, at Lisbon in 1958, and at
Stockholm in 1967. Both the Philippines and the
United States of America, herein private
respondent's country, are signatories to the
Convention. The United States acceded on May
30, 1887 while the Philippines, through its Senate,
concurred on May 10, 1965. The Philippines'
adhesion became effective on September 27,
1965, 48 and from this date, the country
obligated itself to honor and enforce the
provisions of the Convention.

3. Coverage
Rights/Differences

of

Intellectual

Property

Section 4. Definitions. - 4.1. The term "intellectual property


rights" consists of:
a) Copyright and Related Rights;
b) Trademarks and Service Marks;
c) Geographic Indications;
d) Industrial Designs;
e) Patents;
f)Layout-Designs (Topographies) of
Integrated Circuits; and
g) Protection of Undisclosed Information
(n,
TRIPS).
NOTES:
3 concepts:
1. Copyright - Deals with LITERARY and ARTISTIC
WORKS, includes SCIENTIFIC AND SCHOLARLY
WORKS (ex. publications, books, CDs or movies, music)

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

2. Patent - Deals with INVENTIONS, INDUSTRIAL


DESIGNS (ex. Cars) and UTILITY MODELS, includes
TRADE SECRETS
3. Trademark - Deals with VISIBLE SIGNS
susceptible to ocular senses and capable of distinguishing
goods and services (ex. Brands, logos)
CASES:
Kho vs. CA (G.R. No. 115758, march 19, 2002)
FACTS: Petitioner Elidad C. Kho filed a complaint
for injunction and damages with a prayer for the
issuance of a writ of preliminary injunction against
the
respondents
Summerville
General
Merchandising and Company (Summerville, for
brevity) and Ang Tiam Chay.
The petitioners complaint alleges that petitioner,
doing business under the name and style of KEC
Cosmetics Laboratory, is the registered owner of
the copyrights Chin Chun Su and Oval Facial
Cream Container/Case; that she also has patent
rights on Chin Chun Su & Device and Chin Chun
Su for medicated cream after purchasing the
same from Quintin Cheng; he alleges that
respondent Summerville advertised and sold
petitioners cream products under the brand name
Chin Chun Su, in similar containers that petitioner
uses, thereby misleading the public, and resulting
in the decline in the petitioners business sales
and income; and, that the respondents should be
enjoined from allegedly infringing on the
copyrights and patents of the petitioner.
The respondents, on the other hand, alleged as
their defense that Summerville is the exclusive
and authorized importer, re-packer and distributor
of Chin Chun Su products manufactured by Shun
Yi Factory of Taiwan; that the said Taiwanese
manufacturing company authorized Summerville
to register its trade name Chin Chun Su
Medicated Cream with the Philippine Patent Office
and other appropriate governmental agencies;
that KEC Cosmetics Laboratory of the petitioner
obtained the copyrights through misrepresentation
and falsification; and, that the authority of Quintin
Cheng, assignee of the patent registration
certificate, to distribute and market Chin Chun Su
products in the Philippines had already been
terminated by the said Taiwanese Manufacturing
Company.
ISSUE: Whether the copyright and patent over the
name and container of a beauty cream product
would entitle the registrant to the use and
ownership over the same to the exclusion of
others.
HELD: In the case at bar, the petitioner applied for
the issuance of a preliminary injunctive order on
the ground that she is entitled to the use of the
trademark on Chin Chun Su and its container
based on her copyright and patent over the same.
Trademark, copyright and patents are different

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 confined
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 field of human activity which is new,
involves an inventive step and is industrially
applicable.
Petitioner has no right to support her claim for the
exclusive use of the subject trade name and its
container. The name and container of a beauty
cream product are proper subjects of a trademark
inasmuch as the same falls squarely within its
definition. In order to be entitled to exclusively
use the same in the sale of the beauty cream
product, the user must sufficiently prove that she
registered or used it before anybody else did. The
petitioners copyright and patent registration of the
name and container would not guarantee her the
right to the exclusive use of the same for the
reason that they are not appropriate subjects of
the said intellectual rights. Consequently, a
preliminary injunction order cannot be issued for
the reason that the petitioner has not proven that
she has a clear right over the said name and
container to the exclusion of others, not having
proven that she has registered a trademark
thereto or used the same before anyone did.

Pearl & Dean Inc. vs. Shoemart Inc. (G.R. No.


148222, August 15, 2003)
FACTS: Plaintiff-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 Certificate 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 filed with the Bureau of Patents,
Trademarks and Technology Transfer on June 20,
1983, but was approved only on September 12,
1988. From 1981 to about 1988, Pearl and Dean
employed the services of Metro Industrial Services
to manufacture its advertising displays.
Pearl & Dean negotiated with Shoemart for the
lease and installation of the light boxes in
Shoemart Malls. After Pearl & Beans contract was
rescinded, exact copies of its light b oxes were
installed in various SM malls (fabricated by Metro
Industrial Services, and later EYD Rainbow
Advertising Corp.) Pearl & Dean sent a letter to
Shoemart and it sister company. North EDSA
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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Marketing, to cease using the light boxes and to


remove them from the malls, and demanded the
discontinued use of the trade mark Poster Ads.
Unsatisfied with the compliance of its demands,
Pearl & Dean sued. The trial court ruled in favor of
Pearl & Dean, while the appellate court reversed
the decision of the trial court.
ISSUE: Whether pearl & Deans copyright
registration for its light boxes preclude Shoemart
and North Edsa Marketing from using the same
HELD: 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
certificate as well as Copyright Certificate 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:
SEC. 2. The rights granted by this Decree shall, from
the moment of creation, subsist with respect to any of
the following works:
(O) Prints, pictorial illustrations, advertising copies,
labels, tags, and box wraps;

Although petitioners copyright certificate 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 specified in the statute.
Accordingly, it can cover only the works falling
within the statutory enumeration or description.
P & D secured its copyright under the
classification 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
find 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 application of the laws

enumeration in Section 2 prevents us from giving


petitioner even a little leeway, that is, even if its
copyright certificate 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
certificate issued by the National Library as
Advertising Display Units.
In fine, 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 different
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. 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, we ruled that these
three legal rights are completely distinct and
separate from one another, and the protection
afforded by one cannot be used interchangeably
to cover items or works that exclusively pertain to
the others:
Trademark, copyright and patents are different
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 confined 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 field of human activity which is new,
involves an inventive step and is industrially
applicable.

4. The Intellectual Property Office


Section 6. The Organizational Structure of the IPO. - 6.1.
The Office shall be headed by a Director General who shall
be assisted by two (2) Deputies Director General.
6.2. The Office shall be divided into seven (7)
Bureaus, each of which shall be headed by a Director and
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2 6

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

assisted by an Assistant Director. These Bureaus are:


a) The Bureau of Patents;
b) The Bureau of Trademarks;
c) The Bureau of Legal Affairs;
d) The Documentation, Information
and Technology Transfer Bureau;
e) The Management Information
System and EDP Bureau;
(f) The Administrative, Financial and
Personnel Services Bureau; and
(g) The Bureau of Copyright and
Other Related Rights.

protecting IP rights and objectives of this Act.

6.3. The Director General, Deputies Director


General, Directors and Assistant Directors shall be
appointed by the President, and the other officers and
employees of the Office by the Secretary of Trade and
Industry, conformably with and under the Civil Service Law.
(n)
Section 7. The Director General and Deputies Director
General. - 7.1. Functions. - The Director General shall
exercise the following powers and functions:
a) Manage and direct all functions and activities of
the Office, including the promulgation of rules and
regulations to implement the objectives, policies, plans,
programs and projects of the Office: Provided, That in the
exercise of the authority to propose policies and standards
in relation to the following: (1) the effective, efficient, and
economical operations of the Office requiring statutory
enactment; (2) coordination with other agencies of
government in relation to the enforcement of intellectual
property rights; (3) the recognition of attorneys, agents, or
other persons representing applicants or other parties
before the Office; and (4) the establishment of fees for the
filing and processing of an application for a patent, utility
model or industrial design or mark or a collective mark,
geographic indication and other marks of ownership, and
for all other services performed and materials furnished by
the Office, the Director General shall be subject to the
supervision of the Secretary of Trade and Industry;
(b) Exercise exclusive appellate jurisdiction over all
decisions rendered by the Director of Legal Affairs, the
Director of Patents, the Director of Trademarks, the
Director of Copyright and Other Related Rights, and the
Director of the Documentation, Information and Technology
Transfer Bureau. The decisions of the Director General in
the exercise of his appellate jurisdiction in respect of the
decisions of the Director of Patents, the Director of
Trademarks and the Director of Copyright and Other
Related Rights shall be appealable to the Court of Appeals
in accordance with the Rules of Court; and those in respect
of the decisions of the Director of the Documentation,
Information and Technology Transfer Bureau shall be
appealable to the Secretary of Trade and Industry;
(c) Undertake enforcement functions supported by
concerned agencies such as the Philippine National Police,
the National Bureau of Investigation, the Bureau of
Customs, the Optical Media Board, and the local
government units, among others;
(d) Conduct visits during reasonable hours to
establishments and businesses engaging in activities
violating intellectual property rights and provisions of this
Act based on report, information or complaint received by
the office; and
(e)

Such

other

functions

in

furtherance

of

7.2. Qualifications. - The Director General and the


Deputies Director General must be natural born citizens of
the Philippines, at least thirty-five (35) years of age on the
day of their appointment, holders of a college degree, and
of
proven
competence,
integrity,
probity
and
independence: Provided, That the Director General and at
least one (1) Deputy Director General shall be members of
the Philippine Bar who have engaged in the practice of law
for at least ten (10) years: Provided further, That in the
selection of the Director General and the Deputies Director
General, consideration shall be given to such
qualifications as would result, as far as practicable, in the
balanced representation in the Directorate General of the
various fields of intellectual property.
7.3. Term of Office. - The Director General and the
Deputies Director General shall be appointed by the
President for a term of five (5) years and shall be eligible
for reappointment only once: Provided, That the first
Director General shall have a first term of seven (7) years.
Appointment to any vacancy shall be only for the
unexpired term of the predecessor.
7.4. The Office of the Director General. - The Office of the
Director General shall consist of the Director General and
the Deputies Director General, their immediate staff and
such Offices and Services that the Director General will set
up to support directly the Office of the Director General. (n)
Section 8. The Bureau of Patents. - The Bureau of
Patents shall have the following functions:
8.1. Search and examination of patent
applications and the grant of patents;
8.2. Registration of utility models, industrial
designs, and integrated circuits; and
8.3. Conduct studies and researches in the field of
patents in order to assist the Director General in
formulating policies on the administration and
examination of patents. (n)
Section 9. The Bureau of Trademarks. - The Bureau of
Trademarks shall have the following functions:
9.1. Search and examination of the applications for
the registration of marks, geographic indications and other
marks of ownership and the issuance of the certificates of
registration; and
9.2. Conduct studies and researches in the field of
trademarks in order to assist the Director General in
formulating policies on the administration and examination
of trademarks. (n)
Section 9A. The Bureau of Copyright and Other Related
Rights. The Bureau of Copyright and Other Related
Rights shall have the following functions:
9A.1. Exercise original jurisdiction to resolve
disputes relating to the terms of a license involving the
authors right to public performance or other
communication of his work;
9A.2. Accept, review and decide on applications for
the accreditation of collective management organizations
or similar entities;
9A.3. Conduct studies and researches in the field
of copyright and related rights; and

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

9A.4. Provide other copyright and related rights


service and charge reasonable fees therefor.
Section 10. The Bureau of Legal Affairs. - The Bureau of
Legal Affairs shall have the following functions:
10.1. Hear and decide opposition to the application
for registration of marks; cancellation of trademarks;
subject to the provisions of Section 64, cancellation
of patents, utility models, and industrial designs; and
petitions for compulsory licensing of patents;
10.2. (a) Exercise original jurisdiction in
administrative complaints for violations of laws
involving intellectual property rights: Provided, That
its jurisdiction is limited to complaints where the total
damages claimed are not less than Two hundred
thousand pesos (P200,000): Provided further, That
availment of the provisional remedies may be
granted in accordance with the Rules of Court. The
Director of Legal Affairs shall have the power to hold
and punish for contempt all those who disregard
orders or writs issued in the course of the
proceedings. (n)

(v) The imposition of administrative fines in


such amount as deemed reasonable by the Director of
Legal Affairs, which shall in no case be less than Five
thousand pesos (P5,000) nor more than One hundred fifty
thousand pesos (P150,000). In addition, an additional fine
of not more than One thousand pesos (P1,000) shall be
imposed for each day of continuing violation;
(vi) The cancellation of any permit, license,
authority, or registration which may have been granted by
the Office, or the suspension of the validity thereof for such
period of time as the Director of Legal Affairs may deem
reasonable which shall not exceed one (1) year;
(vii) The withholding of any permit, license,
authority, or registration which is being secured by the
respondent from the Office;
(viii) The assessment of damages;
(ix) Censure; and
(x) Other analogous penalties or sanctions. (Secs.
6, 7, 8, and 9, Executive Order No. 913 [1983]a)

(b) After formal investigation, the Director for Legal


Affairs may impose one (1) or more of the following
administrative penalties:

10.3. The Director General may by Regulations


establish
the
procedure
to
govern
the
implementation of this Section. (n)

(i) The issuance of a cease and desist order which


shall specify the acts that the respondent shall cease and
desist from and shall require him to submit a compliance
report within a reasonable time which shall be fixed in the
order;

Section 11. The Documentation, Information and


Technology Transfer Bureau. - The Documentation,
Information and Technology Transfer Bureau shall have
the following functions:

(ii) The acceptance of a voluntary assurance of


compliance or discontinuance as may be imposed. Such
voluntary assurance may include one or more of the
following:
(1) An assurance to comply with the
provisions of the intellectual property law violated;
(2) An assurance to refrain from engaging
in unlawful and unfair acts and practices subject of the
formal investigation;
(3) An assurance to recall, replace, repair,
or refund the money value of defective goods distributed in
commerce; and
(4) An assurance to reimburse the
complainant the expenses and costs incurred in
prosecuting the
case in the Bureau of Legal Affairs.
The Director of Legal Affairs may also require the
respondent to submit periodic compliance reports and file
a bond to guarantee compliance of his undertaking;
(iii) The condemnation or seizure of
products which are subject of the offense. The goods
seized hereunder shall be disposed of in such manner as
may be deemed appropriate by the Director of Legal
Affairs, such as by sale, donation to distressed local
governments or to charitable or relief institutions,
exportation, recycling into other goods, or any combination
thereof, under such guidelines as he may provide;
(iv) The forfeiture of paraphernalia and all
real and personal properties which have been used in the
commission of the offense;

11.1. Support the search and examination


activities of the Office through the following
activities:
(a) Maintain and upkeep classification
systems whether they be national or
international such as the International Patent
Classification (IPC) system;
(b) Provide advisory services for the
determination of search patterns;
(c) Maintain search files and search
rooms and reference libraries; and
(d) Adapt and package industrial
property information.
11.2. Establish networks or intermediaries or regional
representatives;
11.3. Educate the public and build awareness on
intellectual property through the conduct of seminars and
lectures, and other similar activities;
11.4. Establish working relations with research and
development institutions as well as with local and
international intellectual property professional groups and
the like;
11.5. Perform state-of-the-art searches;
11.6. Promote the use of patent information as an effective
tool to facilitate the development of technology in the
country;
11.7. Provide technical, advisory, and other services
relating to the licensing and promotion of technology, and
carry out an efficient and effective program for technology
transfer; and
11.8. Register technology transfer arrangements, and
settle disputes involving technology transfer payments. (n)

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Section 12. The Management Information Services and


EDP Bureau. - The Management Information Services and
EDP Bureau shall:
12.1. Conduct automation planning, research and
development, testing of systems, contracts with firms,
contracting, purchase and maintenance of equipment,
design and maintenance of systems, user consultation,
and the like; and
12.2. Provide management information
support and service to the Office. (n)

Section 13. The Administrative, Financial and Human


Resource Development Service Bureau. - 13.1. The
Administrative Service shall: (a) Provide services relative
to procurement and allocation of supplies and equipment,
transportation, messengerial work, cashiering, payment of
salaries and other Office's obligations, office maintenance,
proper safety and security, and other utility services; and
comply with government regulatory requirements in the
areas of performance appraisal, compensation and
benefits, employment records and reports;
(b) Receive all applications filed with the Office and
collect fees therefor, and
(c) Publish patent applications and grants,
trademark applications, and registration of marks,
industrial designs, utility models, geographic
indication, and lay-out-designs of integrated circuits
registrations.
13.2. The Patent and Trademark Administration Services
shall perform the following functions among others:
(a) Maintain registers of assignments, mergings,
licenses, and bibliographic on patents and
trademarks;
(b) Collect maintenance fees, issue certified copies
of documents in its custody and perform similar
other activities; and
(c) Hold in custody all the applications filed with the
office, and all patent grants, certificate of
registrations issued by the office, and the like.
13.3. The Financial Service shall formulate and
manage a financial program to ensure availability
and proper utilization of funds; provide for an
effective monitoring system of the financial
operations of the Office; and

existing accounting and auditing rules and regulations, all


the fees, fines, royalties and other charges, collected by
the Office under this Act and the other laws that the Office
will be mandated to administer, for use in its operations,
like upgrading of its facilities, equipment outlay, human
resource development, and the acquisition of the
appropriate office space, among others, to improve the
delivery of its services to the public. This amount, which
shall be in addition to the Office's annual budget, shall be
deposited and maintained in a separate account or fund,
which may be used or disbursed directly by the Director
General.
14.2. After five (5) years from the coming into force of this
Act, the Director General shall, subject to the approval of
the Secretary of Trade and Industry, determine if the fees
and charges mentioned in Subsection 14.1 hereof that the
Office shall collect are sufficient to meet its budgetary
requirements. If so, it shall retain all the fees and charges
it shall collect under the same conditions indicated in said
Subsection 14.1 but shall forthwith, cease to receive any
funds from the annual budget of the National Government;
if not, the provisions of said Subsection 14.1 shall continue
to apply until such time when the Director General, subject
to the approval of the Secretary of Trade and Industry,
certifies that the above-stated fees and charges the Office
shall collect are enough to fund its operations. (n)
Section 15. Special Technical and Scientific Assistance. The Director General is empowered to obtain the
assistance of technical, scientific or other qualified officers
and employees of other departments, bureaus, offices,
agencies and instrumentalities of the Government,
including corporations owned, controlled or operated by
the Government, when deemed necessary in the
consideration of any matter submitted to the Office relative
to the enforcement of the provisions of this Act. (Sec. 3,
R.A. No. 165a)
Section 16. Seal of Office. - The Office shall have a seal,
the form and design of which shall be approved by the
Director General. (Sec. 4, R.A. No. 165a)
CASES:
Pest Management Association of the
Philippines vs. Fertilizer and Pesticide
Authority (G.R. No. 156041, feb. 21, 2007)
FACTS:
ISSUE:
HELD:

13.4. The Human Resource Development Service shall


design and implement human resource development plans
and programs for the personnel of the Office; provide for
present and future manpower needs of the organization;
maintain high morale and favorable employee attitudes
towards the organization through the continuing design
and implementation of employee development programs.
(n)
Section 14. Use of Intellectual Property Rights Fees by
the IPO. - 14.1. For a more effective and expeditious
implementation of this Act, the Director General shall be
authorized to retain, without need of a separate approval
from any government agency, and subject only to the

In-N-out Burger, Inc. vs. Sehwani, Inc. and/or


Benita's frites Inc. (G.R. No. 179127, Dec. 24,
2008)
FACTS:
Petitioner IN-N-OUT BURGER, INC., a business
entity incorporated under the laws of California,
United States (US) of America, which is a
signatory to the Convention of Paris on Protection
of Industrial Property and the Agreement on Trade
Related Aspects of Intellectual Property Rights
(TRIPS). Petitioner is engaged mainly in the
restaurant business, but it has never engaged in

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

business in the Philippines. Respondents


Sehwani, Incorporated and Benita Frites, Inc. are
corporations organized in the Philippines.
On 2 June 1997, petitioner filed trademark and
service mark applications with the Bureau of
Trademarks (BOT) of the IPO for "IN-N-OUT"and
"IN-N-OUT Burger & Arrow Design." Petitioner
later found out, through the Official Action Papers
issued by the IPO on 31 May 2000,that
respondent Sehwani, Incorporated had already
obtained Trademark Registration for the mark "IN
N OUT (the inside of the letter "O"formed like a
star)." Petitioner eventually filed on 4 June 2001
before the Bureau of Legal Affairs (BLA) of the
IPO an administrative complaint against
respondents
for
unfair
competition
and
cancellation
of
trademark
registration.
Respondents asserted therein that they had been
using the mark "IN N OUT" in the Philippines
since 15 October 1982. Respondent then filed
with the Bureau of Patents, Trademarks and
Technology Transfer (BPTTT) an application for
the registration of the mark. BPTTT approved its
application and issued the corresponding
certificate of registration in favor of the
respondent.
On Dec 22, 2003, IPO Director of Legal Affairs
rendered a decision in favor of petitioner stating
petitioner had the right to use its tradename and
mark in the Philippines to the exclusion of others.
However, the decision also includes that
respondent is not guilty of unfair competition.
Upon appeal by petitioner, the new IPO Director
General declared that respondents were guilty of
unfair competition on December 23, 2005. On 18
July 2006, the Court of Appeals promulgated a
Decision reversing the Decision dated 23
December 2005 of the IPO Director General. The
appellate court declared that Section 163 of the
Intellectual Property Code specifically confers
upon the regular courts, and not the BLA-IPO,
sole jurisdiction to hear and decide cases
involving provisions of the Intellectual Property
Code,particularly trademarks. Hence, the present
petition.
ISSUE: Whether the IPO (administrative bodies)
have jurisdiction to cases involving unfair
competition
HELD: The Court of Appeals adjudged that the
IPO Director for Legal Affairs and the IPO Director
General had no jurisdiction over the administrative
proceedings below to rule on issue of unfair
competition, because Section 163 of the
Intellectual Property Code confers jurisdiction over
particular provisions in the law on trademarks on
regular courts exclusively.
Section 163. Jurisdiction of Court.All actions under
Sections 150, 155, 164, and 166 to 169 shall be
brought before the proper courts with appropriate
jurisdiction under existing laws.

The provisions referred to in Section 163 are:


Section 150 on License Contracts; Section 155 on
Remedies on Infringement; Section 164 on Notice

of Filing Suit Given to the Director; Section 166 on


Goods Bearing Infringing Marks or Trade Names;
Section 167 on Collective Marks; Section 168 on
Unfair Competition, Rights, Regulation and
Remedies; and Section 169 on False
Designations of Origin, False Description or
Representation.
The Court disagrees with the Court of Appeals.
Section 10 of the Intellectual Property Code
specifically identifies the functions of the Bureau
of Legal Affairs (see: Sec. 10.1, 10.2(a), 10.2(b):
(vi) and (viii))
Unquestionably, petitioners complaint, which
seeks the cancellation of the disputed mark in the
name of respondent Sehwani, Incorporated, and
damages for violation of petitioners intellectual
property rights, falls within the jurisdiction of the
IPO Director of Legal Affairs.
The Intellectual Property Code also expressly
recognizes the appellate jurisdiction of the IPO
Director General over the decisions of the IPO
Director of Legal Affairs (Sec. 7.1 (b) of RA NO.
8293)
The Court of Appeals erroneously reasoned that
Section 10(a) of the Intellectual Property Code,
conferring upon the BLA-IPO jurisdiction over
administrative complaints for violations of
intellectual property rights, is a general provision,
over which the specific provision of Section 163 of
the same Code, found under Part III thereof
particularly governing trademarks, service marks,
and tradenames, must prevail.
Proceeding
therefrom, the Court of Appeals incorrectly
concluded that all actions involving trademarks,
including charges of unfair competition, are under
the exclusive jurisdiction
of civil courts.
Such interpretation is not supported by the
provisions of the Intellectual Property Code.
While Section 163 thereof vests in civil courts
jurisdiction over cases of unfair competition,
nothing in the said section states that the
regular courts have sole jurisdiction over
unfair competition cases, to the exclusion of
administrative bodies.
On the contrary,
Sections 160 and 170, which are also found
under Part III of the Intellectual Property Code,
recognize the concurrent jurisdiction of civil
courts and the IPO over unfair competition
cases.
Based on the foregoing discussion, the IPO
Director of Legal Affairs had jurisdiction to
decide the petitioners administrative case
against respondents and the IPO Director
General had exclusive jurisdiction over the
appeal of the judgment of the IPO Director of
Legal Affairs.

Phil Pharmawealth, Inc. vs. Pfizer Inc, and


Pfizer (Phil) Inc. (G.R. No. 167715, Nov. 17,
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

10

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

period, for non-profit purposes, by an institution the


services of which are available to the public, such as public
library or archive;

2010)
FACTS:
ISSUE:
HELD:

ADOPTION OF INTELLECTUAL PROPERTY POLICIES


Section 230 (New Provision introduced by R.A.
10372:
R.A. No. 10372, SEC. 27. Chapter XX of Republic
Act No. 8293 is hereby amended by adding a new section
at the end thereof to be denominated as Section 230, to
read as follows:
SEC. 230. Adoption of Intellectual Property (IP) Policies.
Schools and universities shall adopt intellectual property
policies that would govern the use and creation of
intellectual property with the purpose of safeguarding the
intellectual creations of the learning institution and its
employees, and adopting locally-established industry
practice fair use guidelines. These policies may be
developed in relation to licensing agreements entered into
by the learning institution with a collective licensing
organization.
III. THE LAW ON COPYRIGHT
NOTE: Section. 172 what are cover under Copyright.
1. Definitions Sections 171-171.13 as amended
by RA 10372
Section 171. Definitions. - For the purpose of this Act, the
following terms have the following meaning:
171.1. "Author" is the natural person who has created the
work;
171.2. A "collective work" is a work which has been created
by two (2) or more natural persons at the initiative and
under the direction of another with the understanding that it
will be disclosed by the latter under his own name and that
contributing natural persons will not be identified;
171.3. Communication to the public or communicate to
the public means any communication to the public,
including broadcasting, rebroadcasting, retransmitting by
cable, broadcasting and retransmitting by satellite, and
includes the making of a work available to the public by
wire or wireless means in such a way that members of the
public may access these works from a place and time
individually chosen by them; (amended one)
171.4. A "computer" is an electronic or similar device
having information-processing capabilities, and a
"computer program" is a set of instructions expressed in
words, codes, schemes or in any other form, which is
capable when incorporated in a medium that the computer
can read, of causing the computer to perform or achieve a
particular task or result;
171.5. "Public lending" is the transfer of possession of the
original or a copy of a work or sound recording for a limited

171.6. "Public performance", in the case of a work other


than an audiovisual work, is the recitation, playing,
dancing, acting or otherwise performing the work, either
directly or by means of any device or process; in the case
of an audiovisual work, the showing of its images in
sequence and the making of the sounds accompanying it
audible; and, in the case of a sound recording, making the
recorded sounds audible at a place or at places where
persons outside the normal circle of a family and that
family's closest social acquaintances are or can be
present, irrespective of whether they are or can be present
at the same place and at the same time, or at different
places and/or at different times, and where the
performance can be perceived without the need for
communication within the meaning of Subsection 171.3;
171.7. "Published works" means works, which, with the
consent of the authors, are made available to the public by
wire or wireless means in such a way that members of the
public may access these works from a place and time
individually chosen by them: Provided, That availability of
such copies has been such, as to satisfy the reasonable
requirements of the public, having regard to the nature of
the work;
171.8. "Rental" is the transfer of the possession of the
original or a copy of a work or a sound recording for a
limited period of time, for profit-making purposes;
1171.9. Reproduction is the making of one (1) or more
copies, temporary or permanent, in whole or in part, of a
work or a sound recording in any manner or form without
prejudice to the provisions of Section 185 of this Act (Sec.
41[E], P.D. No. 49a); (amended one)
171.10. A "work of applied art" is an artistic creation with
utilitarian functions or incorporated in a useful article,
whether made by hand or produced on an industrial scale;
171.11. A "work of the Government of the Philippines"
is a work created by an officer or employee of the
Philippine Government or any of its subdivisions and
instrumentalities,
including
government-owned
or
controlled corporations as a part of his regularly prescribed
official duties.
171.12. Technological measure means any technology,
device or component that, in the normal course of its
operation, restricts acts in respect of a work, performance
or sound recording, which are not authorized by the
authors, performers or producers of sound recordings
concerned or permitted by law; (new subsection added)
171.13. Rights management information means
information which identifies the work, sound recording or
performance; the author of the work, producer of the
sound recording or performer of the performance; the
owner of any right in the work, sound recording or
performance; or information about the terms and
conditions of the use of the work, sound recording or
performance; and any number or code that represent such
information, when any of these items is attached to a copy
of the work, sound recording or fixation of performance or
appears in conjunction with the communication to the

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

public of a work, sound recording or performance. (new


subsection added)
NOTES:
According to FUNA Book:

Originality means the work originated from the intellect of


the author/creator
***he is the source of the work

1. DEFINITION: COPYRIGHT

Copyright is a branch of that part of the law which


deals with the rights of intellectual creators. It deals
with particular forms of creativity, concerned
primarily with mass communication.
Copyright is an exclusive property right granted by
statute to an author of an intellectual production,
for a limited term of years, to multiply and vend
copies of his work and to engage in the other
activities prescribed by the statute in relation to the
subject matter of the grant.

2. COPYRIGHT as a branch of Intellectual Property


Intellectual property is divided into two branches,
industrial property and copyright.

A work is created when the two requirements are met:


1. Originality
2. Some form of expression

Industrial Property- embraces protection of


inventions by means of patents, protection of
certain commercial interests by means of
trademark law and law on trade names, and the
law on protection of industrial designs. It also
embraces the repression of unfair competition.

Novelty is, however, not a requirement.


The ideas in the work do not need to be new but the form,
be it literary or artistic, in which they are expressed must
be an original creation of the author. The work must have
their origin in the labor of the author
ORIGINAL, as the term is used in copyright, means only
that the work was independently created by the author
(as opposed to copied from other works), and that it
possesses at least some minimal degree of creativity.
The distinction is one between creation and discovery:
the first person to find and report a particular fact has not
created the fact; he or she has merely discovered its
existence.
Ex. If regular conversation (text message) cannot be
copyrightable; If there is a poem included: it is
copyrightable.
Law on copyright focuses on creation not discovery.

However, it is not necessary, to qualify for


copyright protection, that works should pass a test
of imaginativeness, of inventiveness. The work is
protected irrespective of the quality thereof and
also when it has.....

The right to obtain a copyright on a book depends


on originality of authors work and not upon any
standard of merit in the subject matter. The right is
given to the first producer of a book, whether that
book is wise or foolish, accurate or inaccurate.

Nor is the artistic worth a picture the criterion by


which is right to copyright is to be determined. If it
commands the interest of public, it has a
commercial value, and whether it has an aesthetic
and educational value is largely a matter of taste.

3. Copyright as purely statutory right

Copyright, in the strict sense of the term, is purely


a statutory right. Being a statutory grant, the rights
are only such as the statute confers, and may be
obtained and enjoyed only with respect to the
subjects and by the persons, and on terms and
conditions specified in the statute. Accordingly, it
can cover only the works falling within the statutory
enumeration or description. (Ching vs. Salinas et
al, 462 SCRA 241)

4. Copyright is distinct from trademark and patent.

Copyright, trademark and patents are completely


distinct and separate from one another and the
protection afforded by one cannot be used
interchangeably to cover items or works that
exclusively pertain to the others (Pearl & Dean
Phils. Inc. v. Shoemart, Inc. et al, 409 SCRA 410,
2003).

2. Protection, when commenced

2nd requirement: EXPRESSION


In order for a work to be entitled protection, there must at
least be some verifiable expression of the intellectual
product.
A mere idea is not protected, only expression!

Section 172.2. Works are protected by the sole fact of


their creation, irrespective of their mode or form of
expression, as well as of their content, quality and
purpose. (Sec. 2, P.D. No. 49a)

There is creation when an idea is expressed in some


tangible form.

-When a work is created?

Copyright deals with the rights of intellectual creators in


their creation. Most works, for. Example books, Paintings
or drawings, exist only once they are embodied in a
physical object. But some of them exist without
embodiment in a physical object. For ex. Music or poems
are works even if they are not, or even before they are,....

Q: Why we need to know when it was created


A: For purposes of protection

Copyright law, however, protects only the form of


expression of ideas, not the ideas themselves

NOTES:
-Work here covers everything

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3. Idea/Expression Dichotomy
Section
175.
Unprotected
Subject
Matter.
Notwithstanding the provisions of Sections 172 and 173,
no protection shall extend, under this law, to any idea,
procedure, system, method or operation, concept,
principle, discovery or mere data as such, even if they are
expressed, explained, illustrated or embodied in a work;
news of the day and other miscellaneous facts having the
character of mere items of press information; or any official
text of a legislative, administrative or legal nature, as well
as any official translation thereof (n)
IDEA/EXPRESSION DICHOTOMY
This means that ideas are not entitled to copyright
protection. The protection of a given work applies to the
expressions od ideas that are contained therein. Mere
ideas found in a work cannot be protected by
copyright. And may be used freely. (From the book of
Funa, Intellectual Property Law, 12th ed.)
Pearl & Dean Inc. Shoemart Case (cited the case the
BAKER vs. SELDEN) -- Principle: idea/expression
dichotomy
Baker vs. Selden
From the case: Selden had obtained a copyright
protection for a book entitled Seldens
Condensed Ledger or Bookkeeping Simplified
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, plaintiff- 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 benefit of
an in-depth examination of novelty.
***Notes from Sir:
Plaintiff Seldens copyright in a book describing a
new system of bookkeeping extended only to his
verbal description of the system, and not to the
system itself. As a consequence, Seldens
copyright did not cover his bookkeeping forms
ruled lines and blank columns with proper
headings which contained no expression
beyond the bare embodiment of the new
bookkeeping method. He should have filed for a
patent for such creation.

Note: It is wiser to apply for a patent first before a


copyright and making such creation public.
The ideas incorporated in a work are not protectable.
Titles works are not copyrightable as they are building
block ideas (other building block: theme, plot and stock
characters and settings).
The right to make a translated work goes in favor of the
owner of the copyright of the original work.
4. Works Protected
a. Literary or Artistic Works
Section 172. Literary and Artistic Works. - 172.1. Literary
and artistic works, hereinafter referred to as "works", are
original intellectual creations in the literary and artistic
domain protected from the moment of their creation and
shall include in particular:
(a) Books, pamphlets, articles and other writings;
(b) Periodicals and newspapers;
(c) Lectures, sermons, addresses, dissertations
prepared for oral delivery, whether or not reduced in writing
or other material form;
(d) Letters;
(e)Dramatic or dramatico-musical compositions;
choreographic works or entertainment in dumb shows;
(f) Musical compositions, with or without words;
(g) Works of drawing, painting, architecture,
sculpture, engraving, lithography or other works of art;
models or designs for works of art;
(h) Original ornamental designs or models for
articles of manufacture, whether or not registrable as an
industrial design, and other works of applied art;
(i) Illustrations, maps, plans, sketches, charts and
three-dimensional works relative to geography, topography,
architecture or science;
(j) Drawings or plastic works of a scientific or
technical character;
(k) Photographic works including works produced
by a process analogous to photography; lantern slides;
(l) Audiovisual works and cinematographic works
and works produced by a process analogous to
cinematography or any process for making audio-visual
recordings;
(m) Pictorial illustrations and advertisements;
(n) Computer programs; and
(o) Other literary, scholarly, scientific and artistic
works.
NOTES:
The law asserts the principle of an all-embracing protection
for the benefit of all productions in the literary, scientific,
and artistic domain, and, in a second assertion, lays down
that the mode or form of expression of a work in no way
affects its protection.
(a) Books, pamphlets, articles and other writings;
all types of writings, manual or type written
(b) Periodicals and newspapers:
News articles are copyrightable; factual info
contained therein are not copyrightable. The news
elementthe info respecting current events
contained in the literary productionsis not the
creation of the writer, but is a report of matters that
ordinarily are public juris, it is the history of the day.

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(c) Lectures, sermons, addresses, dissertations


prepared for oral delivery, whether or not reduced in
writing or other material form; TAKE NOTE: these types of work must be orally delivered
before you can say that it is expressed.
Q: how about drafts of speeches?
A: not protected under par. C rather by. par A;
Q: are impromptu or extemporaneous speeches protected?
A: Although it was not prepared ahead of time, they are still
protected. Provision should not have restrictive
understanding, it is enough that there was mental
preparation
(d) Letters:
Article 723 of New Civil Code. Letters and other private
communication in writing are owned by the person to
whom they are addressed and delivered, but they cannot
be published or disseminated without the consent of the
writer or his heirs. However, the court may authorize their
publication or dissemination if the public good or the
interest of justice so requires.
(e) Dramatic or dramatico-musical compositions;
choreographic works or entertainment in dumb shows;

i.e. Plays, operas , ballets, musicals revues and


the like
Copyrightable when performed - A dramaticmusical
composition
has
the
distinctive
characteristics of containing not only a plot
character and acting but the musical component as
well - Included in this enumeration is a dumb show
(ex. Pantomime) all that is required is that the
acting form is fixed in some medium
Choreographic Works - It must include series of
moves not just social dance steps to be considered
copyrightable (There has to be a pattern)
Excluded from copyright are social dance steps
and simple routines

(f) Musical compositions, with or without words;

When the composition consists of melody and


lyrics, both together enjoy separate copyright
Lyrics alone will be dealt with as a literary work
Where the music and lyrics are composed by two
authors, musical works are considered works of
joint authorship under section 178.2 consisting of
parts that can be used separately. In such a case,
the author of each part shall be the original owner
of the copyright in the part that he has created

(g) Works of drawing, painting, architecture, sculpture,


engraving, lithography or other works of art; models or
designs for works of art;
This can be two dimensional or 3D. covers virtually
all artistic works
Independent of their nature (figurative or abstract)
and their intention (pure or commercial art)
Architectural Plan: Look Sec 186 (RA 8293)
Section 186. Work of Architecture. - Copyright in a work of

architecture shall include the right to control the erection of


any building which reproduces the whole or a substantial
part of the work either in its original form or in any form
recognizably derived from the original: Provided, That
the copyright in any such work shall not include the right to
control the reconstruction or rehabilitation in the same style
as the original of a building to which that copyright relates.
Architectural plans copyright owners, in addition to the
other rights constituting copyright, has the right to control
the erection of any building which reproduces the whole or
a substantial part of the work either in its original form, or in
any form recognizably derived from the original. Once
constructed, however, there is no more right to control
reconstruction or rehabilitation. (With this new provision,
architects have the control of their right by controlling the
construction; further, note that if the building is destroyed
and you have to rebuild, the architect no longer has the
control thereof)
Q: will a buyer of a work of art free to display it publicly?
A: Yes [section 184.1 (j)], whether it be the original or copy
of the work. This is because you are not reproducing but
you are only displaying. Except works produced by film,
slide, television images or analogous process because the
purpose of such creation is for public display (reason:
public display are precisely the sources of economic
advantage for the creators while other works such as
sculptures derive economic gain from the sale of the work
itself)
(h) Original ornamental designs or models for articles
of manufacture, whether or not registrable as an
industrial design, and other works of applied art;

Work of applied art is an artistic creation with


utilitarian functions or incorporated in a useful
article, whether made by hand or produced on an
industrial scale.
Primarily it is a work of art but incidentally it has a
utilitarian purpose
The law refers to a work of applied art which is an
artistic creation. It bears stressing that there is no
copyright protection for works of applied art or
industrial design which have aesthetic or artistic
features that cannot be identified separately from
the utilitarian aspects of the article.
(Case: Ching vs Salinas)
Functional components of useful articles no matter
how artistically designed, have generally been denied
copyright protection unless they are separable from
the useful article.
Unless separable from the useful article, a
decorative quality of a functional component
cannot be considered copyrightable
Ex. Vase, mug ( that has artistic component)
If it becomes unuseful then not protected under "work of
applied art"
(i) Illustrations, maps, plans, sketches, charts and
three- dimensional works relative to geography,
topography, architecture or science;
common denominator: useful purpose
copyrightable because there is a form of
expression

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

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What is copyrightable in a map is the selection,


arrangement and presentation of the component
parts

(j) Drawings or plastic works of a scientific or technical


character;

(k) Photographic works including works produced by a


process analogous to photography; lantern slides;

The selecting, arranging and posing of the subject


and background, the light and shade arrangements
all fulfill the requirement or originality.

(l) Audiovisual works and cinematographic works and


works produced by a process analogous to
cinematography or any process for making audiovisual recordings;

Motion pictures and other audiovisual works are


most often embodied in film. It is now clear,
however, that this need not be the case. A work is
no less a motion picture (or other audiovisual work)
because the images are embodied in the video
tape, video disk, or any other tangible form
The soundtrack of movies are protected with the
same copyright that protects the movies
themselves

(m) Pictorial illustrations and advertisements;


Included in copyright protection under this
category are pictorial matter and text alike
Included in copyright protection under this
category are pictorial matter and text alike.
Included too are greeting cards, picture postcards,
prints and labels used for merchandise.
They are distinct form trademark protection (deals
with the nature of the goods)
Label can be protected as long as it has an artistic
value, appreciable amount of original text or
pictorial material to be copyrightable. It must go
beyond a mere trademark and has a value of
creation
For a textual matter to be copyrightable it must aid
or augment an accompanying graphical illustration
NOTE: Esp. In advertisements of product cover under the
law trademark
Ex. Designs of the label, but separate rights
BOEING; the logo is not considered work of
authorship because it only consist of a text in a simple
typeface, so it is not an object of copyright in respect to US
law. However this logo is protected under trademark law.
Unlike STARBUCKS LOGO; it has some sort of
creativity
(n) Computer programs;
Sec. 171.4: definition of computer - an electronic or similar
device having information-processing capabilities, and a
"computer program" is a set of instructions expressed in
words, codes, schemes or in any other form, which is
capable when incorporated in a medium that the computer
can read, of causing the computer to perform or achieve a
particular task or result.

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Computer programs are identified as literary works


(gatt-trips)
Computer programs are set of instruction to
perform a specific task
A computer program , whether in object code or
source code, is a literary work and is protected
from unauthorized copying, whether from its object
or source code version
Ideas can be expressed in different manners, so if
a computer expert finds a program worthy of
reproduction, he can express it in another way thru
source codes. Thus the expression is still protected
as well
Computer programs are copyrightable not under
patents.
Computer programs are copyrightable.

(o) Other literary, scholarly, scientific and artistic


works.
172.2. Works are protected by the sole fact of their
creation, irrespective of their mode or form of expression,
as well as of their content, quality and purpose. (Sec. 2,
P.D. No. 49a)
Principle of Automatic Protection (Sec. 172.2)
-it provides that the enjoyment and exercise of
copyright, including moral rights, shall not be subjected of
any formality.
CASES:
Columbia Pictures vs. CA (261 SCRA 144
(1996))
FACTS: Complainants thru counsel lodged a
formal complaint with the National Bureau of
Investigation for violation of PD No. 49, as
amended, and sought its assistance in their antifilm piracy drive. Agents of the NBI and private
researchers made discreet surveillance on various
video establishments in Metro Manila including
Sunshine Home Video Inc. owned and operated
by Danilo A. Pelindario.
NBI Senior Agent applied for a search warrant
with the court a quo against Sunshine. The search
warrant was served to Sunshine and/or their
representatives. In the course of the search of the
premises indicated in the search warrant, the NBI
Agents found and seized various video tapes of
duly copyrighted motion pictures/films owned or
exclusively distributed by private complainants,
and machines, equipment, television sets,
paraphernalia, materials, accessories all of which
were included in the receipt for properties
accomplished by the raiding team. Copy of the
receipt was furnished and/or tendered to Mr.
Danilo A. Pelindario, registered owner-proprietor
of Sunshine Home Video.
AReturn of Search Warrant was filed with the
Court. A Motion To Lift the Order of Search
Warrant was filed but was later denied for lack of
merit. A Motion for reconsideration of the Order of
denial was filed. The court a quo granted the said
motion for reconsideration and justified it.
Petitioners thereafter appealed the order of the

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trial court granting private respondents motion for


reconsideration, thus lifting the search warrant
which it had therefore issued, to the Court of
Appeals. As stated at the outset, said appeal was
dismissed and the motion for reconsideration
thereof was denied. Hence, this petition was
brought to this Court particularly challenging the
validity of respondent courts retroactive
application of the ruling in 20th Century Fox Film
Corporation vs. Court of Appeals, et al. in
dismissing petitioners appeal and upholding the
quashal of the search warrant by the trial court.
ISSUE: Whether registration and deposit
requirements under Presidential Decree No. 49 as
prerequisites for invoking the courts protective
mantle in copyright infringement cases.
HELD: It is pointless for private respondents to
insist on compliance with the registration and
deposit requirements under Presidential Decree
No. 49 as prerequisites for invoking the courts
protective mantle in copyright infringement cases.
Defendants-movants contend that PD 49 as
amended covers only producers who have
complied with the requirements of deposit and
notice (in other words registration) under Sections
49 and 50 thereof. Absent such registration, as in
this case, there was no right created, hence, no
infringement under PD 49 as amended. This is
not well-taken.
As correctly pointed out by private complainantsoppositors, the Department of Justice has
resolved this legal question as far back as
December 12, 1978 in its Opinion No. 191 of
the then Secretary of Justice Vicente Abad
Santos which stated that Sections 26 and 50
do not apply to cinematographic works and PD
No. 49 had done away with the registration
and deposit of cinematographic works and
that even without prior registration and
deposit of a work which may be entitled to
protection under the Decree, the creator can
file action for infringement of its rights. He
cannot demand, however, payment of damages
arising from infringement. The same opinion
stressed that the requirements of registration and
deposit are thus retained under the Decree, not as
conditions for the acquisition of copyright and
other rights, but as prerequisites to a suit for
damages. The statutory interpretation of the
Executive Branch being correct, is entitled (to)
weight and respect.
PD 49 as amended, does not require registration
and deposit for a creator to be able to file an
action for infringement of his rights.
These
conditions are merely pre-requisites to an action
for damages. So, as long as the proscribed acts
are shown to exist, an action for infringement may
be initiated.
Accordingly, the certifications from the Copyright
Section of the National Library, presented as
evidence by private respondents to show nonregistration of some of the films of petitioners,
assume no evidentiary weight or significance,

whatsoever.
Furthermore, a closer review of Presidential
Decree No. 49 reveals that even with respect to
works which are required under Section 26
thereof to be registered and with copies to be
deposited with the National Library, such as
books, including composite and cyclopedic works,
manuscripts, directories and gazetteers; and
periodicals, including pamphlets and newspapers;
lectures, sermons, addresses, dissertations
prepared for oral delivery; and letters, the failure
to comply with said requirements does not deprive
the copyright owner of the right to sue for
infringement. Such non-compliance merely limits
the remedies available to him and subjects him to
the corresponding sanction.
The reason for this is expressed in Section 2 of
the decree which prefaces its enumeration of
copyrightable works with the explicit statement
that the rights granted under this Decree shall,
from the moment of creation, subsist with respect
to any of the following classes of works. This
means that under the present state of the law, the
copyright for a work is acquired by an intellectual
creator from the moment of creation even in the
absence of registration and deposit. As has been
authoritatively clarified:
The registration and deposit of two complete
copies or reproductions of the work with the
National Library within three weeks after the first
public dissemination or performance of the work,
as provided for in Section 26 (P.D. No. 49, as
amended), is not for the purpose of securing a
copyright of the work, but rather to avoid the
penalty for non-compliance of the deposit of said
two copies and in order to recover damages in an
infringement suit.

Registration is not a requirement for its


protection,

Ching vs. Salinas (G.R. No. 161295, June 29,


2005)
FACTS: Ching is the owner and general manager
of Jeshicris Manufacturing Co., the maker and
manufacturer of a Utility Model, described as
Leaf Spring Eye Bushing for Automobile made
up of plastic. Ching and Joseph Yu were issued
by the National Library Certificates of Copyright
Registration and Deposit of the said work
described therein as Leaf Spring Eye Bushing for
Automobile. Ching requested the NBI for
police/investigative
assistance;
NBI
filed
applications for search warrants against William
Salinas, Sr. and the officers and members of the
Board of Directors of Wilaware Product
Corporation. The RTC granted the application and
issued Search Warrant (SW) for the seizure of the
articles in the SW application.
The respondents filed a motion to quash the
search warrants on the following grounds:
2. The copyright registrations were issued in
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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

violation of the Intellectual Property Code on the


ground that:
a) the subject matter of the registrations are not
artistic or literary;
b)
the subject matter of the registrations are
spare parts of automobiles meaning there (sic)
are original parts that they are designed to
replace. Hence, they are not original.

a central hole to secure a conventional bearing


and a plurality of ridges provided therefore, with
said cushion bearing being made of the same
plastic materials. Plainly, these are not literary or
artistic works. They are not intellectual creations
in the literary and artistic domain, or works of
applied art. They are certainly not ornamental
designs or one having decorative quality or value.

The respondents averred that the works covered


by the certificates issued by the National Library
are not artistic in nature; they are considered
automotive spare parts and pertain to technology.
They aver that the models are not original, and as
such are the proper subject of a patent, not
copyright.

It bears stressing that the focus of copyright is the


usefulness of the artistic design, and not its
marketability. The central inquiry is whether the
article is a work of art. Works for applied art
include all original pictorials, graphics, and
sculptural works that are intended to be or have
been embodied in useful article regardless of
factors such as mass production, commercial
exploitation, and the potential availability of
design patent protection.

The trial court issued an order granting the


motion, and quashed the search warrant. His
motion for reconsideration of the order denied by
the trial court. The petitioner filed a petition for
certiorari in the CA. He insisted that his works are
covered by Sections 172.1 and 172.2 of the
Intellectual Property Code. CA rendered judgment
dismissing the petition on its finding that the RTC
did not commit any grave abuse of its discretion in
issuing the assailed order.
ISSUE: Whether petitioners models are works of
applied art or artistic works.
HELD: To discharge his burden of probable cause
for the issuance of a search warrant for violation
of R.A. No. 8293, the petitioner-applicant
submitted to the RTC Certificate of Copyright
Registration Nos. 2001-197 and 2001-204 dated
September 3, 2001 and September 4, 2001,
respectively, issued by the National Library
covering work identified as Leaf Spring Eye
Bushing for Automobile and Vehicle Bearing
Cushion both classified under Section 172.1(h) of
R.A. No. 8293, to wit:
SEC. 172. Literary and Artistic Works. 172.1. Literary
and artistic works, hereinafter referred to as works,
are original intellectual creations in the literary and
artistic domain protected from the moment of their
creation and shall include in particular: ...
(h)
Original ornamental designs or models for
articles of manufacture, whether or not registrable as
an industrial design, and other works of applied art.
Related to the provision is Section 171.10, which
provides that a work of applied art is an artistic
creation with utilitarian functions or incorporated in a
useful article, whether made by hand or produced on
an industrial scale.

But, as gleaned from the specifications appended


to the application for a copyright certificate filed by
the petitioner, the said Leaf Spring Eye Bushing
for Automobile is merely a utility model described
as comprising a generally cylindrical body having
a co-axial bore that is centrally located and
provided with a perpendicular flange on one of its
ends and a cylindrical metal jacket surrounding
the peripheral walls of said body, with the bushing
made of plastic that is either polyvinyl chloride or
polypropylene. Likewise, the Vehicle Bearing
Cushion is illustrated as a bearing cushion
comprising a generally semi-circular body having

As gleaned from the description of the models


and their objectives, these articles are useful
articles which are defined as one having an
intrinsic utilitarian function that is not merely to
portray the appearance of the article or to convey
information. Indeed, while works of applied art,
original intellectual, literary and artistic works are
copyrightable, useful articles and works of
industrial design are not. A useful article may be
copyrightable only if and only to the extent that
such design incorporates pictorial, graphic, or
sculptural features that can be identified
separately from, and are capable of existing
independently of the utilitarian aspects of the
article.
We agree with the contention of the petitioner
(citing Section 171.10 of R.A. No. 8293), that the
authors intellectual creation, regardless of
whether it is a creation with utilitarian functions or
incorporated in a useful article produced on an
industrial scale, is protected by copyright law.
However, the law refers to a work of applied art
which is an artistic creation. It bears stressing
that there is no copyright protection for works of
applied art or industrial design which have
aesthetic or artistic features that cannot be
identified separately from the utilitarian aspects of
the article. Functional components of useful
articles, no matter how artistically designed,
have generally been denied copyright
protection unless they are separable from the
useful article.
In this case, the petitioners models are not
works of applied art, nor artistic works. They
are utility models, useful articles, albeit with
no artistic design or value. The Leaf Spring
Eye Bushing and Vehicle Bearing Cushion are not
ornamental. They lack the decorative quality
or value that must characterize authentic
works of applied art. They are not even
artistic creations with incidental utilitarian
functions or works incorporated in a useful
article.
In actuality, the personal properties
described in the search warrants are mechanical
works, the principal function of which is utility
sans any aesthetic embellishment. The bushing
and cushion are not works of art. They are, as
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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

the petitioner himself admitted, utility models


which may be the subject of a patent.

2. The work must recast, transform or adoptand not


simply copythe work upon which it s based.

b. Derivative Works
Section 173. Derivative Works. - 173.1. The following
derivative works shall also be protected by copyright:
(a) Dramatizations, translations, adaptations,
abridgments, arrangements, and other alterations of
literary or artistic works; and
(b) Collections of literary, scholarly or artistic works,
and compilations of data and other materials which are
original by reason of the selection or coordination or
arrangement of their contents. (Sec. 2, [P] and [Q], P.D.
No. 49)
173.2. The works referred to in paragraphs (a) and (b) of
Subsection 173.1 shall be protected as new works:
Provided however, That such new work shall not affect
the force of any subsisting copyright upon the original
works employed or any part thereof, or be construed to
imply any right to such use of the original works, or to
secure or extend copyright in such original works. (Sec. 8,
P.D. 49; Art. 10, TRIPS)
NOTES:
Example of Derivative works:
A novel converts it to movie. (the same
expression)
Derivative work of a literary or artistic work shall be
protected as original works. Derivative works are those
based on another pre-existing (underlying) work.

They are protected as original works since their


creation calls for intellectual efforts. The protection
that those works enjoy is without prejudice to the
copyright of the originals.

In order to translate, adapt, arrange or alter a protected


work, the consent of the author is needed, unless, of
course, the work is in the public domain.
In both instance of derivative and reproduction, one should
seek the authorization of the original owner. This is
because it is the exclusive right of the owner to have a
reproduction and derivation of his work.
Thus, where both the original and derivative work are
protected, a double set of rights must be acknowledged.
(the right of the author of the pre-existing work and the right
of the author derivative workthey can co-exist)
~During lifetime and 50 years after death...after 50
year it belongs to public domain.
Q: Why is it important to determine that a work is derivative
work?
A: Because derivative work is protected as original work.
Q: when can we say that an alteration is considered a
derivative work?
A: any type of alteration will not automatically afford
protection. The requirements (below)
Two boundaries to constitute a derivative work:
1. The work must borrow original and expressive
content from another work and

To constitute a derivative work, the new work must be so


substantial similar to the underlying work that in the
absence...
Note: There must be a substantial variation form the
underlying work, not merely a trivial variation.
The author must have contributed a
distinguishable variation form the older
works. In such cases, of course, only those
parts which are new are protected by the
new copyright
A derivative work is protected as a new work
independent from the underlying original work.
It does not affect the subsisting copyright of the
original work (sec. 173.2, IPC)
even if you authorize, it does not mean that
you relinquish such right from any subsequent
copies of work
Q: Can an author of a derivative work w/o authority from
the underlying work enjoy copyright protection?
A: No. One who adapts... Art. 5 Civil Code
Art, 5 CC. Acts executed against the provisions of
mandatory or prohibitory laws shall be void, except
when the law itself authorizes their validity.
CASE:
Laktaw vs. Paglinawan
(44 Phil 855, 1918)
FACTS: In the complaint presented in the Court of
First Instance, it was alleged: (1) That the plaintiff
was, according to the laws regulating literary
properties, the registered owner and author of a
literary work entitled Diccionario Hispano-Tagalog
(Spanish-Tagalog Dictionary) published in the City
of Manila in 1889 by the printing establishment La
Opinion, (2) that the defendant, without the
consent of the plaintiff, reproduced said literary
work, improperly copied the greater part thereof in
the work published by him and entitled
Diccionariong Kastila-Tagalog (Spanish-Tagalog
Dictionary) (3) that said act of the defendant,
which is a violation of article 7 of the Law of
January 10, 1879, on Intellectual Property, caused
irreparable injuries to the plaintiff, who was
surprised when, on publishing his new work
entitled Diccionario Tagalog-Hispano(TagalogSpanish Dictionary) he learned of the fact.
The defendeant denied and the trial court
rendered judgment absolving the defendant from
the complaint, but without making any special
pronouncement as to costs.
The ground of the decision appealed from is that a
comparison of the plaintiff's dictionary with that of
the defendant does not show that the latter is an
improper copy of the former, which has been
published and offered for sale by the plaintiff for
about twenty-five years or more. For this reason
the court held that the plaintiff had no right of
action and that the remedy sought by him could

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

18

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

not be granted.
The appellant contends that court below erred in
not declaring that the defendant had reproduced
the plaintiff's work and that the defendant had
violated article 7 of the Law of January 10, 1879,
on Intellectual Property. Said article provides:
Nobody may reproduce another person's work
without the owner's consent, even merely to
annotate or add anything to it, or improve any
edition thereof. Therefore, in order that said article
may be violated, it is not necessary, as the court
below seems to have understood, that a work
should be an improper copy of another work
previously published. It is enough that another's
work has been reproduced without the consent of
the owner, even though it be only to annotate, add
something to it, or improve any edition thereof.
HELD: According to article 428 of the Civil Code,
the author of a literary, scientific, or artistic work,
has the right to exploit it and dispose thereof at
will. In relation to this right, there exists the
exclusive right of the author, who is the absolute
owner of his own work, to produce it, according to
article 2 of the Law of January 10, 1879, and
consequently, nobody may reproduce it, without
his permission, not even to annotate or add
something to it, or to improve any edition thereof,
according to article 7 of said law. Manresa, in his
commentaries on article 429 of the Civil Code (vol.
3, p. 633, 3d ed.) says that the concrete statement
of the right to literary properties is found in the
legal doctrine according to which nobody may
reproduce another person's work, without the
consent of his owner, or even to annotate or add
something to it or to improve any edition thereof.
And on page 616 of said volume, Manresa says
the following:
He who writes a book, or carves a statue, or makes an
invention, has the absolute right to reproduce or sell it,
just as the owner of land has the absolute right to sell it
or its fruits. But while the owner of land, by selling it and
its fruits, perhaps fully realizes all its economic value, by
receiving its benefits and utilities, which are presented,
for example, by the price, on the other hand the author
of a book, statue or invention, does not reap all the
benefits and advantages of his own property by
disposing of it, for the most important form of realizing
the economic advantages of a book, statue or invention,
consists in the right to reproduce it in similar or like
copies, everyone of which serves to give to the person
reproducing them all the conditions which the original
requires in order to give the author the full enjoyment
thereof. If the author of a book, after its publication,
cannot prevent its reproduction by any person who may
want to reproduce it, then the property right granted him
is reduced to a very insignificant thing and the effort
made in the production of the book is no way rewarded.

Indeed the property right recognized and


protected by the Law of January 10, 1879, on
Intellectual Property, would be illusory if, by
reason of the fact that said law is no longer in
force as a consequence of the change of
sovereignty in these Islands, the author of a work,
who has the exclusive right to reproduce it, could
not prevent another person from so doing without
his consent, and could not enforce this right
through the courts of justice in order to prosecute

the violator of this legal provision and the


defrauder or usurper of his right, for he could not
obtain the full enjoyment of the book or other
work, and his property right thereto, which is
recognized by law, would be reduced, as Manresa
says, to an insignificant thing, if he should have no
more right than that of selling his work.
The reproduction by the defendant without the
plaintiff's consent of the Diccionario HispanoTagalog (Spanish-Tagalog Dictionary), published
and edited in the City of Manila in 1889, by the
publication of the Diccionariong Kastila- Tagalog
(Spanish-Tagalog Dictionary), published in the
same city and edited in the press El Progreso in
1913, as appears from Exhibit B, which is
attached to the complaint, has caused the plaintiff,
according to the latter, damages in the sum of
$10,000. It is true that it cannot be denied that the
reproduction of the plaintiff's book by the
defendant has caused damages to the former, but
the amount thereof has not been determined at
the trial, for the statement of the plaintiff as to the
proceeds he would have realized if he had printed
in 1913 the number of copies of his work which he
stated in his declaration a fact which he did not
do because the defendant had reproduced it
was not corroborated in any way at the trial and is
based upon mere calculations made by the
plaintiff
himself;
for
which
reason
no
pronouncement can be made in this decision as to
the indemnification for damages which the plaintiff
seeks to recover.
c. Published Edition
Section 174. Published Edition of Work. - In addition to the
right to publish granted by the author, his heirs, or assigns,
the publisher shall have a copyright consisting merely of
the right of reproduction of the typographical
arrangement of the published edition of the work. (n)
This right only covers the right of reproduction and it only
belongs to the publisher. But this right of reproduction is
limited only only with respect to typographical
arrangements not to the content.
Ex. Posting in the internet
-Not with respect to the contents but to the typographical
arrangement
5. Works not protected
a. Unprotected Subject Matter
Section
175.
Unprotected
Subject
Matter.
Notwithstanding the provisions of Sections 172 and 173,
no protection shall extend, under this law, to any idea,
procedure, system, method or operation, concept,
principle, discovery or mere data as such, even if they
are expressed, explained, illustrated or embodied in a
work; news of the day and other miscellaneous facts
having the character of mere items of press
information; or any official text of a legislative,
administrative or legal nature, as well as any official
translation thereof (n)
NOTE: Not Copyrightable:
1. IDEAS
2. WORKS OF GOVERNMENTSec. 176
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

19

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

CASE:
Joaquin, Jr. vs. Drilon (302 SCRA 225 (1999))
FACTS: Petitioner BJ Productions, Inc. (BJPI) is
the holder/grantee of Certificate of Copyright No.
M922 dated January 28, 1971 of Rhoda and Me,
a dating game show aired from 1970 to 1977. In
1973, petitioner BJPI submitted to the National
Library an addendum to its certificate of copyright
specifying the shows format and style
presentation.
In 1991, petitioner Francisco
Joaquin, Jr., president of BJPI, saw on RPN 9 an
episode of Its a Date. He immediately protested
the airing of the show through a letter sent to
Grabriel M. Zosa, president and general manager
of IXL Productions, Inc., the producer of Its a
Date. Petitioner Joaquin informed respondent
Zosa of a copyright to Rhoda and Me and
demanded that IXL discontinue airing Its a Date.
Respondent Zosa apologized to Joaquin, but
continued airing the show. Zosa also sought to
register IXLs copyright to the first episode of Its a
Date for which a certificate of copyright was
issued by the National Library on August 14,
1991.
With these developments, petitioners
herein filed a complaint against Zosa and other
RPN Channel 9 officers as a result of which an
information for violation of P.D. No. 49 was filed
before the Regional Trial Court of Quezon City.
Zosa appealed to the Department of Justice. The
Secretary of Justice reversed the prosecutors
findings and directed the dismissal of the case.
Petitioner
Joaquin
filed
a
motion
for
reconsideration, but it was denied by the
Secretary of Justice. Hence, this petition. Both
public and private respondents maintained that
petitioners failed to establish the existence of
probable cause due to their failure to present the
copyrighted master videotape of Rhoda and Me.
They contended that BJPIs copyright covers only
a specific episode of Rhosa and Me and that the
formats or concepts of dating game shows were
not covered by the copyright protection under P.D:
No. 49.
Issue: whether or not format or mechanics of a
television show is not included in the list of
protected works.
HELD: The format of a show is not copyrightable.
Section 2 of P.D. No. 49,[10] otherwise known as
the DECREE ON INTELLECTUAL PROPERTY,
enumerates the classes of work entitled to
copyright protection, to wit: Section 2. The rights
granted by this Decree shall, from the moment of
creation, subsist with respect to any of the
following classes of works: (A) Books, including
composite and cyclopedic works, manuscripts,
directories, and gazetteers; (B) Periodicals,
including pamphlets and newspapers; (C)
Lectures, sermons, addresses, dissertations
prepared for oral delivery; (D) Letters; (E)
Dramatic or dramatico-musical compositions;
choreographic works and entertainments in dumb
shows, the acting form of which is fixed in writing
or otherwise; (F) Musical compositions, with or
without words; (G) Works of drawing, painting,
architecture, sculpture, engraving, lithography,

and other works of art; models or designs for


works of art; (H) Reproductions of a work of art;
(I) Original ornamental designs or models for
articles of manufacture, whether or not
patentable, and other works of applied art; (J)
Maps, plans, sketches, and charts; (K) Drawings
or plastic works of a scientific or technical
character; (L) Photographic works and works
produced by a process analogous to
photography; lantern slides; (M) Cinematographic
works and works produced by a process
analogous to cinematography or any process for
making audio-visual recordings; (N) Computer
programs; (O) Prints, pictorial illustrations
advertising copies, labels, tags, and box wraps;
(P) Dramatizations, translations, adaptations,
abridgements, arrangements and other alterations
of literary, musical or artistic works or of works of
the Philippine government as herein defined,
which shall be protected as provided in Section 8
of this Decree. (Q) Collections of literary,
scholarly, or artistic works or of works referred to
in Section 9 of this Decree which by reason of the
selection and arrangement of their contents
constitute intellectual creations, the same to be
protected as such in accordance with Section 8 of
this Decree. (R) Other literary, scholarly, scientific
and artistic works.
This provision is substantially the same as 172
of the INTELLECTUAL PROPERTY CODE OF
THE PHILIPPINES (R.A. No. 8293). The format
or mechanics of a television show is not included
in the list of protected works in 2 of P.D. No. 49.
For this reason, the protection afforded by the law
cannot be extended to cover them.
P.D. No. 49, 2, in enumerating what are subject
to copyright, refers to finished works and not to
concepts. The copyright does not extend to an
idea, procedure, process, system, method of
operation, concept, principle, or discovery,
regardless of the form in which it is described,
explained, illustrated, or embodied in such work.
[15] Thus, the new INTELLECTUAL PROPERTY
CODE OF THE PHILIPPINES provides:
Sec. 175.
Unprotected Subject Matter. Notwithstanding the provisions of Sections 172 and
173, no protection shall extend, under this law, to any
idea, procedure, system, method or operation, concept,
principle, discovery or mere data as such, even if they
are expressed, explained, illustrated or embodied in a
work; news of the day and other miscellaneous facts
having the character of mere items of press
information; or any official text of a legislative,
administrative or legal nature, as well as any official
translation thereof.

What then is the subject matter of petitioners


copyright? This Court is of the opinion that
petitioner BJPIs copyright covers audio-visual
recordings of each episode of Rhoda and Me, as
falling within the class of works mentioned in P.D.
49, 2(M), to wit: Cinematographic works and
works produced by a process analogous to
cinematography or any process for making audiovisual recordings;
The copyright does not extend to the general
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

approval of where the work is created is


necessary before one exploits the work. Not
prohibitory, but merely regulatory

concept or format of its dating game show.


Accordingly, by the very nature of the subject of
petitioner BJPIs copyright, the investigating
prosecutor should have the opportunity to
compare the videotapes of the two shows.
-SC held that if it was the format of the show Rhoda &
Me the petitioner sought to protect, he could not turn
to the courts for it, for none would be afforded him.
But because It's a Date merely embodied the very
same idea, it could not be held liable.

Except (not need approval): statutes, rules and


regulation, and speeches, lectures, sermons,
addresses and dissertations

Section 176.3:

Q since no copyright subsist, does this mean


government cant own a copyright?

A: NO, because government is not precluded


from receiving and holding copyrights
transferred to it by assignment, bequest or
otherwise

The format of the show is not copyrightable.


b. Works of Government
Section 176. Works of the Government. - 176.1. No
copyright shall subsist in any work of the Government
of the Philippines. However, prior approval of the
government agency or office wherein the work is created
shall be necessary for exploitation of such work for profit.
Such agency or office may, among other things, impose as
a condition the payment of royalties. No prior approval or
conditions shall be required for the use of any purpose of
statutes, rules and regulations, and speeches, lectures,
sermons, addresses, and dissertations, pronounced, read
or rendered in courts of justice, before administrative
agencies, in deliberative assemblies and in meetings of
public character. (Sec. 9, first par., P.D. No. 49)
176.2. The author of speeches, lectures, sermons,
addresses, and dissertations mentioned in the preceding
paragraphs shall have the exclusive right of making a
collection of his works. (n)
176.3. Notwithstanding the foregoing provisions, the
Government is not precluded from receiving and
holding copyrights transferred to it by assignment,
bequest or otherwise; nor shall publication or
republication by the Government in a public document of
any work in which copyright is subsisting be taken to cause
any abridgment or annulment of the copyright or to
authorize any use or appropriation of such work without the
consent of the copyright owner. (Sec. 9, third par., P.D. No.
49)
Sec. 171.11. A "work of the Government of the Philippines"
is a work created by an officer or employee of the
Philippine Government or any of its subdivisions and
instrumentalities,
including
government-owned
or
controlled corporations as a part of his regularly prescribed
official duties.
NOTES:

Any work outside the scope of his official duties is


outside the ambit of the provision

Philosophy behind the provision: works of


employment is copyrightable but the owner of
such is the employer if the work is made in
accordance or within his scope of his regular
duties

Although no copyright subsists, government can


still assert its possessory rights over the work. It
will not preclude the government regulatory
measures with the use of such works. Thus prior

6. Copyright or Economic Rights; Ownership


NOTES:
2 rights of a copyright holder: these rights are
classified as
(1) EXCLUSIVE RIGHTS (sec. 177: exclusive rights to
carry out, authorize or prevent the following acts
177.1 177.7) and
(2) STATUTORY RIGHTS (provided or conferred by law:
1. Right to reproduce
2. Right to make derivative works
3. Right to first public distribution
4. Right to rental
5. Right to public display of original work
6. Right to public performance
7. Other communication; limited to what the statutes
confers)
Two set of rights:
1. Economic rights- suggests a right of fair return for
his work; to generate income from his works;
2. Moral rights
a. Copyright or Economic Rights
Section 177. Copyright or Economic Rights. - Subject to
the provisions of Chapter VIII, copyright or economic
rights shall consist of the exclusive right to carry out,
authorize or prevent the following acts:
177.1. Reproduction of the work or substantial
portion of the work;
most elemental of the rights of copyright owner
this is where they earn profit from their works
Reproduction is not necessarily in the same form,
because any type of reproduction, regardless of
the change in form and medium is still considered
reproduction.
177.2. Dramatization, translation, adaptation,
abridgment, arrangement or other transformation of the
work;

(derivation of works)
Movie, before being produced must seek the
authorization of the author

177.3. The first public distribution of the original


and each copy of the work by sale or other forms of

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

transfer of ownership;
*or first transfer of ownership
Distribution: transfer of ownership of the object (not
the copyright)
First public distribution: classic example is the sale
to the end user (not to retailers and distributors)
Right belongs to the author.
Why only limited to first distribution? Because, the
moment the copyright owner parted with the
original copy or object, it is the end user has
control over the subsequent sales. Thus author no
longer has the control of subsequent sale. The
ownership over the object is absolutely conveyed
to another person. (absolute transfer of ownership)
Qualification to first public distribution (author can
still participate with regards to gross proceeds;
exception to the rule of first publication):
Section 200. Sale or Lease of Work. In every
sale or lease of an original work of painting or
sculpture or of the original manuscript of a
writer or composer, subsequent to the first
disposition thereof by the author, the author or
his heirs shall have an inalienable right to
participate in the gross proceeds of the
sale or lease to the extent of five percent
(5%). This right shall exist during the lifetime of
the author and for fifty (50) years after his
death.
177.4. Rental of the original or a copy of an
audiovisual or cinematographic work, a work
embodied in a sound recording, a computer program, a
compilation of data and other materials or a musical
work in graphic form, irrespective of the ownership of the
original or the copy which is the subject of the rental; (n)
The right of rental only covers specific works (enumerated
above)
Q: Why limit only to this type of works?
A: Because the basis of making of this work is the
continued use of such product. Motive of making such work
is the repetitive use of the end users. Authors can stipulate
the no rental of his work shall take place
177.5. Public display of the original or a copy of the
work;
See: Section 184.1 par. J exception
(j) Public display of the original or a copy of the
work not made by means of a film, slide, television image
or otherwise on screen or by means of any other device or
process: Provided, That either the work has been
published, or, that the original or the copy displayed has
been sold, given away or otherwise transferred to another
person by the author or his successor in title; and
The right of public display includes movie stills. To display
images non sequentially
Limitations of copyright: new owner of the work has the
right of public display of literary or artistic works
177.6. Public performance of the work; and
See: Sec. 171. 6
171.6. "Public performance", in the case of a

work other than an audiovisual work, is the recitation,


playing, dancing, acting or otherwise performing the work,
either directly or by means of any device or process; in the
case of an audiovisual work, the showing of its images in
sequence and the making of the sounds accompanying it
audible; and, in the case of a sound recording, making the
recorded sounds audible at a place or at places where
persons outside the normal circle of a family and that
family's closest social acquaintances are or can be
present, irrespective of whether they are or can be present
at the same place and at the same time, or at different
places and/or at different times, and where the
performance can be perceived without the need for
communication within the meaning of Subsection 171.3;
Why we have to determine whether an act is a public or
private...in order to determine if it is whether a violation of
the economic rights of the author.
Take Note the definition the word performance as well as
Public.

Recitation
playing,
dancing
or
otherwise
performing. Work otherwise audiovisual (showing
of images in sequence)

To whom should it be performed: place open to the


public or at any place where a substantial number
of persons outsider the normal circle of a family
and its social acquaintances is gathered

It can be at the same place or time or different


place or time. It can still be performance without
the need of communication (present or remotely
witnessed; wired or wireless means)

NOTE: whether reproduction or derivation, if


without the permission of the real author, there is
an infringement. But note that a derivation is
protected as a new work and therefore has a
separate economic rights. Further, such new work
shall not affect the force of any subsisting
copyright. Meaning, it should not impair the rights
of the author of the underlying work.

177.7. Other communication to the public of the


work. (Sec. 5, P. D. No. 49a
-It covers all types of communication
NOTE: How can we characterized economic rights?
It is a statutory rights (based on the laws)-limited to
any thing what the law provides
Therefore, the rights bestowed by law on the owner of
copyright in a protected work are frequently described as
exclusive rights to authorize others to use the protected
work.
Anyone who violates any of the exclusive rights of
copyright owner, that is, anyone who trespasses into
exclusive domain by using or authorizing the use of
copyrighted work in one of the five ways set forth in
statute, is an infringer of the copyright.

the
his
the
the

Being a mere statutory grant, the rights are limited to what


the statute confers.

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Note: Reproduction of the work or substantial portion of


the work
The right to reproduce is taken to be the most
elemental of the rights of a copyright owner, the very same
acts that constitutes reproduction, when done by one other
than the owner...
The right of the owner of copyright to prevent others from
making copies of his works is the most basic right under
copyright. For example, the right of a phonogram producer
to manufacture and distribute compact discs containing...
Thus, when an entire article is computer-scanned, stored in
a hard disk of a computer or in some medium, there is
reproduction. These days to cater to the blind, several
best-sellers have been recorded on cassettes. Although
the reproduction be of a kind different from the original
material, the statutory definition still categorizes it as a
reproduction.
Dramatization, translation, adaptation. Etc (Derivative
works)
It is clear that the owner of copyright controls the
adaptation of the work.
The acts of translating....
Adaptation is generally understood as the modification
of a work from one type of work to another, for ex.,
adapting a novel so as to make a motion picture...
The first public distribution of the original and each
copy of the work by sale or other forms of transfer of
ownership
The right to distribute to the public by sale (or by any other
mode of transfer)...
Only with respect to MATERIAL OBJECT
EXCEPTION (even after first distribution, the owner
still have the right) :
However, Sec. 200 states that in every sale or
lease of an original work of painting or composer,
subsequent to the first disposition, the author has the
inalienable right to participate in the gross proceeds of
the sale or lease to the extent of 5%.
Sec 200, (right to participate to the proceed of
lease/sale limited only to 5%)
Rental of the original copy or a copy of an audiovisual
or cinematographic work, etc.
Rental is defined as the transfer of the
possession...
The author of such works undertakes to create these works
most of the time with the end in view of deriving profit by
renting out copies of these works to the public. The new
provision is therefore a protection of the producer's
expectations. Precisely, because....
Public display of the original or a copy of the work
-iT INCLUDES THE RIGHT OF THE COPYRIGHT
OWNER TO DISPLAY OR SHOW THE WORK OR AN
IMAGE OF IT TO THE PUBLIC.
In case of a motion or picture or of an audiovisual
work, to display....

Exception to right to public display:


Sec. 184.3 (j)
(j) Public display of the original or a copy of the work not
made by means of a film, slide, television image or
otherwise on screen or by means of any other device or
process: Provided, That either the work has been
published, or, that the original or the copy displayed has
been sold, given away or otherwise transferred to another
person by the author or his successor in title; and
CASES:

Pearl & dean Inc., supra

Filipino Society of Composers vs. tan (148


SCRA 461 (1987))
FACTS:
Plaintiff-appellant is a non-profit association of
authors, composers and publishers duly
organized under the Corporation Law of the
Philippines and registered with the Securities and
Exchange Commission. Said association is the
owner of certain musical compositions among
which are the songs entitled: "Dahil Sa Iyo",
"Sapagkat Ikaw Ay Akin," "Sapagkat Kami Ay Tao
Lamang" and "The Nearness Of You."
Defendant-appellee is the operator of a restaurant
known as "Alex Soda Foundation and Restaurant"
where a combo with professional singers, hired to
play and sing musical compositions to entertain
and amuse customers therein, were playing and
singing the above-mentioned compositions
without any license or permission from the
appellant to play or sing the same. Accordingly,
appellant demanded from the appellee payment of
the necessary license fee for the playing and
singing of aforesaid compositions but the demand
was ignored. Hence, appellant filed a complaint
with the lower court for infringement of copyright
against defendant-appellee for allowing the
playing in defendant-appellee's restaurant of said
songs copyrighted in the name of the former.
Defendant-appellee, in his answer, countered that
the complaint states no cause of action. While not
denying the playing of said copyrighted
compositions in his establishment, appellee
maintains that the mere singing and playing of
songs and popular tunes even if they are
copyrighted do not constitute an infringement
under the provisions of Section 3 of the Copyright
Law (Act 3134 of the Philippine Legislature). The
lower court, finding for the defendant, dismissed
the complaint. Plaintiff appealed to the Court of
Appeals.
ISSUE: Whether or not the playing and signing of
musical
compositions
which
have
been
copyrighted under the provisions of the Copyright
Law (Act 3134) inside the establishment of the
defendant-appellee
constitute
a
public
performance for profit within the meaning and
contemplation of the Copyright Law of the
Philippines; and assuming that there were indeed
public performances for profit, whether or not

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

23

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

appellee can be held liable therefor.


HELD: The petition is devoid of merit.
SC concede that indeed there were "public
performances for profit. " The word "perform" as
used in the Act has been applied to "One who
plays a musical composition on a piano, thereby
producing in the air sound waves which are heard
as music ... and if the instrument he plays on is a
piano plus a broadcasting apparatus, so that
waves are thrown out, not only upon the air, but
upon the other, then also he is performing the
musical composition."
In relation thereto, it has been held that "The
playing of music in dine and dance establishment
which was paid for by the public in purchases of
food and drink constituted "performance for profit"
within a Copyright Law." (Buck, et al. v. Russon)
Thus, it has been explained that while it is
possible in such establishments for the patrons to
purchase their food and drinks and at the same
time dance to the music of the orchestra, the
music is furnished and used by the orchestra
for the purpose of inducing the public to
patronize the establishment and pay for the
entertainment in the purchase of food and
drinks. The defendant conducts his place of
business for profit, and it is public; and the music
is performed for profit. In a similar case, the Court
ruled that "The Performance in a restaurant or
hotel dining room, by persons employed by the
proprietor, of a copyrighted musical composition,
for the entertainment of patrons, without charge
for admission to hear it, infringes the exclusive
right of the owner of the copyright."
In the case at bar, it is admitted that the patrons of
the restaurant in question pay only for the food
and drinks and apparently not for listening to the
music. As found by the trial court, the music
provided is for the purpose of entertaining and
amusing the customers in order to make the
establishment more attractive and desirable. It
will be noted that for the playing and singing the
musical compositions involved, the combo was
paid as independent contractors by the appellant.
It is therefore obvious that the expenses entailed
thereby are added to the overhead of the
restaurant which are either eventually charged in
the price of the food and drinks or to the overall
total of additional income produced by the bigger
volume of business which the entertainment was
programmed to attract. Consequently, it is
beyond question that the playing and singing
of the combo in defendant-appellee's
restaurant constituted performance for profit
contemplated by the Copyright Law. (Act 3134
amended by P.D. No. 49, as amended).
Nevertheless, appellee cannot be said to have
infringed upon the Copyright Law. Appellee's
allegation that the composers of the contested
musical compositions waived their right in
favor of the general public when they allowed
their intellectual creations to become property
of the public domain before applying for the
corresponding copyrights for the same is
correct. The Supreme Court has ruled that

"Paragraph 33 of Patent Office Administrative


Order No. 3 (as amended, dated September 18,
1947) entitled 'Rules of Practice in the Philippines
Patent Office relating to the Registration of
Copyright Claims' promulgated pursuant to
Republic Act 165, provides among other things
that an intellectual creation should be copyrighted
thirty (30) days after its publication, if made in
Manila, or within the (60) days if made elsewhere,
failure of which renders such creation public
property." Indeed, if the general public has made
use of the object sought to be copyrighted for
thirty (30) days prior to the copyright application
the law deems the object to have been donated to
the public domain and the same can no longer be
copyrighted.
After careful study of the records, it shows that the
musical compositions in question had long
become public property, and are therefore beyond
the protection of the Copyright Law.
Malang Santos vs. McCullough Printing (12
SCRA 321)
FACTS: an action for damages based on the
provisions of Articles 721 and 722 of the Civil
Code of the Philippines, allegedly on the
unauthorized use, adoption and appropriation by
the defendant company of plaintiff's intellectual
creation or artistic design for a Christmas Card.
The design depicts "a Philippine rural Christmas
time scene consisting of a woman and a child in a
nipa hut adorned with a star-shaped lantern and a
man astride a carabao, beside a tree, underneath
which appears the plaintiff's pen name, Malang."
The complaint alleges that plaintiff Mauro Malang
Santos designed for former Ambassador Felino
Neri, for his personal Christmas Card greetings for
the year 1959, the artistic motif in question. The
following year the defendant McCullough Printing
Company, without the knowledge and authority of
plaintiff, displayed the very design in its album of
Christmas cards and offered it for sale, for a price.
For such unauthorized act of defendant, plaintiff
suffered moral damages to the tune of
P16,000.00, because it has placed plaintiff's
professional integrity and ethics under serious
question and caused him grave embarrassment
before Ambassador Neri.
ISSUE:
(1) whether plaintiff is entitled to
protection, notwithstanding the, fact that he has
not copyrighted his design;
(2) whether the publication is limited, so as to
prohibit its use by others, or it is general
publication,
HELD: Under the established facts, We find that
plaintiff is not entitled to a protection, the provision
of the Civil Code, notwithstanding. Paragraph 33
of Patent Office Administrative Order No. 3
entitled "Rules of Practice in the Philippines
Patent Office relating to the Registration of
Copyright Claims" promulgated pursuant to
Republic Act 165, provides, among others, that an
intellectual creation should be copyrighted thirty
(30) days after its publication, if made in Manila,
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

24

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

thereto shall remain with the creator, unless there is a


written stipulation to the contrary;
178.5. In the case of audiovisual work, the
copyright shall belong to the producer, the author of the
scenario, the composer of the music, the film director, and
the author of the work so adapted. However, subject to
contrary or other stipulations among the creators, the
producer shall exercise the copyright to an extent
required for the exhibition of the work in any manner,
except for the right to collect performing license fees for the
performance of musical compositions, with or without
words, which are incorporated into the work; and
178.6. In respect of letters, the copyright shall
belong to the writer subject to the provisions of Article 723
of the Civil Code. (Sec. 6, P.D. No. 49a)

or within sixty (60) day's if made elsewhere, failure


of which renders such creation public property. In
the case at bar, even as of this moment, there is
no copyright for the design in question. We are not
also prepared to accept the contention of
appellant that the publication of the design was a
limited one, or that there was an understanding
that only Ambassador Neri should, have absolute
right to use the same. In the first place, if such
were the condition then Ambassador Neri would
be the aggrieved party, and not the appellant. In
the second place, if there was such a limited
publication or prohibition, the same was not
shown on the face of the design. When the
purpose is a limited publication, but the effect is
general publication, irrevocable rights thereupon
become vested in the public, in consequence of
which enforcement of the restriction becomes
impossible.

Section 179. Anonymous and Pseudonymous Works. For purposes of this Act, the publishers shall be deemed
to represent the authors of articles and other writings
published without the names of the authors or under
pseudonyms, unless the contrary appears, or the
pseudonyms or adopted name leaves no doubt as to the
author's identity, or if the author of the anonymous works
discloses his identity. (Sec. 7, P.D. 49)

When Ambassador Neri distributed 800 copies of


the design in controversy, the plaintiff lost
control of his design and the necessary
implication was that there had been a general
publication, there having been no showing of a
clear indication that a limited publication was
intended. The author of a literary composition has
a right to the first publication thereof. He has a
right to determine whether it shall be published at
all, and if published, when, where, by whom, and
in what form. This exclusive right is confined to the
first publication. When once published, it is
dedicated to the public, and the author loses the
exclusive right to control subsequent publication
by others, unless the work is placed under the
protection of the copyright law.

Article 723 of New Civil Code. Letters and other private


communication in writing are owned by the person to
whom they are addressed and delivered, but they cannot
be published or disseminated without the consent of the
writer or his heirs. However, the court may authorize their
publication or dissemination if the public good or the
interest of justice so requires.
NOTE:
Copyright ownership belongs to the author of the work.
(Sec. 178.1 IPC)

Sec. 178.1
b. Copyright Ownership
Section 178. Rules on Copyright Ownership. - Copyright
ownership shall be governed by the following rules:
178.1 Subject to the provisions of this section, in
the case of original literary and artistic works, copyright
shall belong to the author of the work;
178.2. In the case of works of joint authorship,
the co-authors shall be the original owners of the
copyright and in the absence of agreement, their rights
shall be governed by the rules on co-ownership. If,
however, a work of joint authorship consists of parts that
can be used separately and the author of each part can be
identified, the author of each part shall be the original
owner of the copyright in the part that he has created;
178.3. In the case of work created by an author
during and in the course of his employment, the copyright
shall belong to:
(a) The employee, if the creation of the object of
copyright is not a part of his regular duties even if the
employee uses the time, facilities and materials of the
employer.
(b) The employer, if the work is the result of the
performance of his regularly-assigned duties, unless
there is an agreement, express or implied, to the contrary.
178.4. In the case of a work commissioned by a
person other than an employer of the author and who pays
for it and the work is made in pursuance of the
commission, the person who so commissioned the work
shall have ownership of the work, but the copyright

Q: Why is it necessary to identify the owner?


A: Because The owner has the exclusive and statutory
right (carry out, authorize and prevent those stipulated in
the statutory rights)
In case of joint-authorship, the co-authors shall be
the original owners of the copyright subject to the rules on
co-ownership unless there is an agreement between them.
(Sec. 178. 2 IPC )

Sec 178.3
In the case of work created by an author during and IN
THE COURSE OF HIS EMPLOYMENT, the copyright shall
belong to:
(a) The employee, if the creation of the object of
copyright is not a part of his regular duties even if the
employee uses the time, facilities and materials of the
employer.
(b) The employer, if the work is the result of the
performance of his regularly-assigned duties, unless there
is an agreement, express or implied, to the contrary.
(Take Note: work--not definite...it must be copyright
belongs to the employee)
Exception the above-rules: if the parties have a
contrary agreement (express or implied) applicable only to
178.3

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

25

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Sec. 178.4
In a case of a commissioned work: the person who so
commissioned the work shall have ownership of the work,
but the copyright thereto shall remain with the creator,
unless is a written stipulation to the contrary.
Sec. 178.5
In the case of audio-visual work, it shall belong to the
producer, author of the scenario, composer of the music,
film director. and author of the work so adapted.
However, subject to contrary or other stipulations among
the creators, the producer shall exercise the copyright to an
extent required for the exhibition of the work in any manner
(the right for public performance is vested on the
producer), except for the right to collect performing license
fees for the performance of musical compositions, with or
without words, which are incorporated into the work; and
Sec. 179
Anonymous and Pseudonymous work: The publisher shall
be deemed to represent the authors of articles and writings
published without their names or under pseudonyms.
Except:
(i) when the contrary appears;
(ii) the pseudonyms or adapted name leaves no doubt as
to the author's identity; or
(iii) if author of anonymous works discloses his identity
(Sec. 179)
7. Transfer/Assignment or Licensing of Copyright
R.A. 10372, SEC. 8. Section 180 of Republic Act No. 8293
is hereby amended to read as follows:
SEC. 180. Rights of Assignee or Licensee. 180.1. The
copyright may be assigned or licensed in whole or in part.
Within the scope of the assignment or license, the
assignee or licensee is entitled to all the rights and
remedies which the assignor or licensor had with respect to
the copyright.
180.2. The copyright is not deemed assigned or licensed
inter vivos, in whole or in part, unless there is a written
indication of such intention.
180.3. The submission of a literary, photographic or artistic
work to a newspaper, magazine or periodical for
publication shall constitute only a license to make a
single publication unless a greater right is expressly
granted. If two (2) or more persons jointly own a copyright
or any part thereof, neither of the owners shall be entitled
to grant licenses without the prior written consent of the
other owner or owners. (Sec. 15, P.D. No. 49a)
180.4. Any exclusivity in the economic rights in a work
may be exclusively licensed. Within the scope of the
exclusive license, the licensee is entitled to all the rights
and remedies which the licensor had with respect to the
copyright.
180.5. The copyright owner has the right to regular
statements of accounts from the assignee or the licensee
with regard to assigned or licensed work.
SEC. 181. Copyright and Material Object. The
copyright is distinct from the property in the material
object subject to it. Consequently, the transfer,
assignment or licensing of the copyright shall not itself

constitute a transfer of the material object. Nor shall a


transfer or assignment of the sole copy or of one or several
copies of the work imply transfer, assignment or licensing
of the copyright. (Sec. 16, P.D. No. 49)
Section 182. Filing of Assignment or License. - An
assignment or exclusive license may be filed in
duplicate with the National Library upon payment of
the prescribed fee for registration in books and
records kept for the purpose. Upon recording, a copy of
the instrument shall be returned to the sender with a
notation of the fact of record. Notice of the record shall be
published in the IPO Gazette. (Sec. 19, P.D. No. 49a)
NOTES:
Sec. 180.1
-It connotes transfer of ownership
-Copyright may be assigned or licensed in whole or in part,
which would entitle assignee & licensee to all rights and
remedies which assignor/licensor had with respect to the
copyright (Sec. 180.1)
-there must be a written indication for such intention
Sec. 180.2
Copyright is not deemed assigned/licensed inter vivos in
whole or in part unless there is a written indication of such
intention
Exception: Sec. 180.3
Unless greater right is expressly granted,
submission of a literary, photographic or artistic work
to a newspaper, magazine or periodical for publication
shall constitute only a license to make a single
publication NOTE: If two (2) or more persons jointly
own a copyright or any part thereof, neither of the
owners shall be entitled to grant licenses without the
prior written consent of the other owner or owners.
- thus if they republish it, they need the consent of
the author
Since copyright is distinct from the property in the material
object subject to it: the transfer or assignment/licensing of
the copyright shall not itself constitute a transfer of the
material object; nor shall a transfer or assignment of the
sole copy or or of one or several copies of the work imply
transfer or assignment of the copyright.
8. Designation of Society
Section 183. Designation of Society. - The copyright
owners or their heirs may designate a society of artists,
writers or composers to enforce their economic rights and
moral rights on their behalf. (Sec. 32, P.D. No. 49a)
Copyright owners or their heirs may designate a society of
artists, writers or composers to collectively manage their
economic & moral rights. For these societies to be able
to enforce their economic and moral rights they must
be accredited with the IPO (Sec. 183)
He needs the logistics or resources of group of persons
who will promote the enforcements of rights. Thus they can
designate society of artists who will impose and promote
their rights (ex. Filipino Society of Composers)
9. Limitations of Copyright
a. Limitations on Copyright

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

26

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Section 184. Limitations on Copyright. - 184.1.


Notwithstanding the provisions of Chapter V, the following
acts shall not constitute infringement of copyright:

otherwise on screen or by means of any other device


or process: Provided, That either the work has been
published, or, that the original or the copy displayed has
been sold, given away or otherwise transferred to another
person by the author or his successor in title; and

(a) The recitation or performance of a work, once


been lawfully made accessible to the public, if
privately and free of charge or if made strictly
charitable or religious institution or society; (Sec.
P.D. No. 49)

(k) Any use made of a work for the purpose of any judicial
proceedings or for the giving of professional advice by a
legal practitioner.

it has
done
for a
10(1),

(b) The making of quotations from a published work if


they are compatible with fair use and only to the extent
justified for the purpose, including quotations from
newspaper articles and periodicals in the form of press
summaries: Provided, That the source and the name of the
author, if appearing on the work, are mentioned; (Sec. 11,
third par., P.D. No. 49)
(c) The reproduction or communication to the public by
mass media of articles on current political, social,
economic, scientific or religious topic, lectures, addresses
and other works of the same nature, which are delivered in
public if such use is for information purposes and has not
been expressly reserved: Provided, That the source is
clearly indicated; (Sec. 11, P.D. No. 49)
(d) The reproduction and communication to the public
of literary, scientific or artistic works as part of reports
of current events by means of photography,
cinematography or broadcasting to the extent necessary
for the purpose; (Sec. 12, P.D. No. 49)
(e) The inclusion of a work in a publication, broadcast, or
other communication to the public, sound recording or film,
if such inclusion is made by way of illustration for
teaching purposes and is compatible with fair use:
Provided, That the source and of the name of the author, if
appearing in the work, are mentioned;
(f) The recording made in schools, universities, or
educational institutions of a work included in a
broadcast for the use of such schools, universities or
educational institutions: Provided, That such recording
must be deleted within a reasonable period after they
were first broadcast: Provided, further, That such
recording may not be made from audiovisual works which
are part of the general cinema repertoire of feature films
except for brief excerpts of the work;
(g) The making of ephemeral recordings by a broadcasting
organization by means of its own facilities and for use in its
own broadcast;
(h) The use made of a work by or under the direction or
control of the Government, by the National Library or by
educational, scientific or professional institutions where
such use is in the public interest and is compatible with fair
use;
(i) The public performance or the communication to the
public of a work, in a place where no admission fee is
charged in respect of such public performance or
communication, by a club or institution for charitable or
educational purpose only, whose aim is not profit making,
subject to such other limitations as may be provided in the
Regulations; (n)
(j) Public display of the original or a copy of the work not
made by means of a film, slide, television image or

SEE: RA No. 10372, SEC. 11. Section 184.1. of Republic


Act No. 8293 is hereby amended to read as follows:
SEC. 184. Limitations on Copyright. x x x
(1) The reproduction or distribution of published articles or
materials in a specialized format exclusively for the use of
the blind, visually- and reading-impaired persons:
Provided, That such copies and distribution shall be made
on a nonprofit basis and shall indicate the copyright
owner and the date of the original publication.
NOTES:
Limitations of Copyright:
a) Private Recitation or performance; or strictly for
charitable and religious institutions;
Should be private or free of charge. If with fee,
should be for charitable or religious institution
the work before considered to be a limitation,
the work should be lawfully made accessible to
the public (it is already being disseminated to
the public)
b) Quotations and press summaries;
purpose of quotation: for commentary, for
criticism; it can be used in any manner as long
as compatible with fair use and only to the
extent justified for that purpose
when one critiques, you should highlight such
presentation (it should already be a published
work)
c) Communications by mass media for information
purposes;
focus on publication, tv, radio
what type of works: works referring to current
political, social,
made for information purposes and have not
been expressly reserved. If there is a
reservation, this paragraph is not applicable
d) Communications as part of report of current events;
it does not qualify if it is for information
purposes. This is for a general purpose (any
purpose including information purposes)
e) Inclusion of work for teaching purposes;
f) (f) The recording made in schools, universities, or
educational institutions of a work included in a broadcast
for the use of such schools, universities or educational
institutions: Provided, That such recording must be deleted
within a reasonable period after they were first broadcast:
Provided, further, That such recording may not be made
from audiovisual works which are part of the general
cinema repertoire of feature films except for brief excerpts
of the work;

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

There is a qualification that the work is included in


a broadcast and should be educational in purpose
It must be destroyed or deleted within a reasonable
period after the first performance

single copy done by a natural person exclusively


for research and private study shall be permitted,
without the authorization of the owner of copyright
in the work. (Sec, 187, IPC) Exception: Sec. 187.2

(g) The making of ephemeral recordings by a broadcasting


organization by means of its own facilities and for use in its
own broadcast;
An ephemeral recording is a temporary copy of a
sound recording which is maintained by a
transmitting organization, such as a television,,
radio or webcasting service.
Under the present law, transmitting organizations
are allowed to retain a single ephemeral copy free
of charge.
Under the present US law, the copy must be
destroyed within six months from the first date of
the transmission unless iy is intended for archival
purposes.
Ephemeral
recordings
by
broadcasting
organizations
Rationale why ephemeral recordings would not
constitute an infringment is that the recording
is made only for a transitory purpose, that is,
solely for the purpose of facilitating a
transmission of a public performance of a
sound recording under certain limitations.
Broadcasting organizations are characterized as
transmitting organizations, and are exempted
from an infringement charge in broadcasting
copyrighted works provided it is only to make a
single copy of a copyrighted work to facilitate their
broadcast. Thus, a program supplier is not a
broadcaster, but a television station is.

187.2. The permission granted under Subsection 187.1


shall not extend to the reproduction of:
(a) A work of architecture in the form of building
or other construction;
(b) An entire book, or a substantial part thereof,
or of a musical work in graphic form by reprographic
means;
(c) A compilation of data and other materials;
(d) A computer program except as provided in
Section 189; and
(e) Any work in cases where reproduction would
unreasonably conflict with a normal exploitation of the
work or would otherwise unreasonably prejudice the
legitimate interests of the author.

h) Use by the govt and such use is in public interest;


i) Communication
education purpose;

to

the

public-for-

charitable

and

Q: how is it distinguished with paragraph (a)? A: this should


be a public performance while for (a) it is for private
performance
j) Public display of work, exc. Films etc.
k) Any use made of a work for the purpose of any judicial
proceedings or for the giving of professional advice by a
legal practitioner

No infringement rule for legal practitioners

184.2. The provisions of this section shall be interpreted in


such a way as to allow the work to be used in a manner
which does not conflict with the normal exploitation of the
work and does not unreasonably prejudice the right
holder's legitimate interests.
- (interpret in the manner that will guide the courts
to determine if it is infringement or not; if the answer to the
question of conflict is affirmative, then it is infringement; if
not then it is considered a limitation on copyright. Thus the
person doing such, even without the authority of the author
is not liable for copyright infringement)
Sec. 187
Private Reproduction of a published work in a

Reprographic reproduction by libraries. (Sec. 188,


IPC)

Example of Reprographic is Photocopying


Reproduction in one back-up copy of computer
programs (Sec. 189)
Importation for personal purposes when copies of
the work are not available in the Phil. (Sec. 190)
b. Fair Use of Copyright Work
SEC. 12. Section 185.1. of Republic Act No. 8293 is
hereby amended to read as follows:
SEC. 185. Fair Use of a Copyrighted Work. 185.1. The
fair use of a copyrighted work for criticism, comment, news
reporting, teaching including limited number of copies for
classroom use, scholarship, research, and similar
purposes is not an infringement of copyright.
Decompilation, which is understood here to be the
reproduction of the code and translation of the forms
of a computer program to achieve the inter-operability
of an independently created computer program with
other programs may also constitute fair use under the
criteria established by this section, to the extent that such
decompilation is done for the purpose of obtaining the
information necessary to achieve such interoperability.
185.2. The fact that a work is unpublished shall not by
itself bar a finding of fair use if such finding is made upon
consideration of all the above factors.
CASES:
A&M Records Inc. vs. Napster Inc. No. 00-16401
US Court Decision)
Habana vs. Robles (G.R. No. 131522, July 19,
1999)
Facts: petitioners are authors and copyright
owners of duly issued certificates of copyright
registration covering their published works,
produced through their combined resources and
efforts, entitled College English for Today (cet),
books 1 and 2, and workbook for college
freshman english, series 1. Respondent Felicidad
Robles and Goodwill Trading Co., inc. are the
author/publisher and distributor/seller of another

INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

the artistic (usually for commercial purpose) in nature from


scholarly/fact-based (it is for diffusion of knowledge)

published work entitled Developing English


Proficiency (dep), books 1 and 2 (1985 edition)
which book was covered by copyrights issued to
them.

c. Work of Architecture

In the course of revising their published works,


petitioners scouted and looked around various
bookstores to check on other textbooks dealing
with the same subject matter. By chance they
came upon the book of respondent Robles and
upon perusal of said book they were surprised to
see that the book was strikingly similar to the
contents, scheme of presentation, illustrations and
illustrative examples in their own book, CET. After
an itemized examination and comparison of the
two books (CET and DEP), petitioners found that
several pages of the respondents book are
similar, if not all together a copy of petitioners
book, which is a case of plagiarism and copyright
infringement.

Section 186. Work of Architecture. - Copyright in a work of


architecture shall include the right to control the erection of
any building which reproduces the whole or a substantial
part of the work either in its original form or in any form
recognizably derived from the original: Provided, That the
copyright in any such work shall not include the right to
control the reconstruction or rehabilitation in the same style
as the original of a building to which that copyright relates.
(n)
d. Reproduction of Published Work
Section 187. Reproduction of Published Work. - 187.1.
Notwithstanding the provision of Section 177, and subject
to the provisions of Subsection 187.2, the private
reproduction of a published work in a single copy, where
the reproduction is made by a natural person exclusively
for research and private study, shall be permitted, without
the authorization of the owner of copyright in the work.

Petitioners then made demands for damages


against respondents and also demanded that they
cease and desist from further selling and
distributing to the general public the infringed
copies of respondent Robles works.

187.2. The permission granted under Subsection 187.1


shall not extend to the reproduction of:
(a) A work of architecture in the form of building or
other construction;
(b) An entire book, or a substantial part thereof, or
of a musical work in graphic form by reprographic means;
(c) A compilation of data and other materials;
(d) A computer program except as provided in
Section 189; and
(e) Any work in cases where reproduction would
unreasonably conflict with a normal exploitation of the work
or would otherwise unreasonably prejudice the legitimate
interests of the author. (n)

However, respondents ignored the demands,


hence, petitioners filed with the Regional Trial
Court, Makati, a complaint for Infringement
and/or unfair competition with damages against
private respondents.
The trial court dismissed the complaint of the
petitioners herein. Petitioners appealed their case
to the CA, which affirmed the judgment of the trial
court.
The CA also deleted the award of
attorneys fees, since its view was that there was
no bad faith on the part of the petitioners in
instituting the action. The petitioners filed a
motion for reconsideration, but, the CA denied the
same, hence, this petition for review on certiorari.

e. Reprographic Reproduction by Libraries

NOTE:
Section 185 covers all types of works as long as Fair
use unlike Section 184 only specific works
-Fair use is not an infringement of copyrighted
The fair use of a copyrighted work for criticism,
comment, news reporting, teaching, including multiple
copies for classroom use, scholarship, research and
similar purposes is not an infringement of copyright.
(Section 185)
NOTE: Under the judicial doctrine of fair use, as adopted
into law, the following are to be considered in determining
fair use:
1. The purpose and character of the use
2. The nature of the copyrighted work
3. The amount and substantiality of the
portion used in relation to the copyrighted
work as a wholesale
4. The effect of the use on the potential
market for or value of the copyrighted
work.
NATURE of COPYRIGHTED WORK: we have to determine

SEC. 188. Reprographic Reproduction by Libraries.


188.1. Notwithstanding the provisions of Subsection 177.1.,
any library or archive whose activities are not for profit may,
without the authorization of the author or copyright owner,
make a limited number of copies of the work, as may be
necessary for such institutions to fulfill their mandate, by
reprographic reproduction:
(a) Where the work by reason of its fragile
character or rarity cannot be lent to user in its original form;
(b) Where the works are isolated articles contained
in composite works or brief portions of other published
works and the reproduction is necessary to supply them,
when this is considered expedient, to persons requesting
their loan for purposes of research or study instead of
lending the volumes or booklets which contain them; and
(c) Where the making of such limited copies is in
order to preserve and, if necessary in the event that it is
lost, destroyed or rendered unusable, replace a copy, or to
replace, in the permanent collection of another similar
library or archive, a copy which has been lost, destroyed or
rendered unusable and copies are not available with the
publisher.
188.2. Notwithstanding the above provisions, it shall not be

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permissible to produce a volume of a work published in


several volumes or to produce missing tomes or pages of
magazines or similar works, unless the volume, tome or
part is out of stock: Provided, That every library which, by
law, is entitled to receive copies of a printed work, shall be
entitled, when special reasons so require, to reproduce a
copy of a published work which is considered necessary for
the collection of the library but which is out of stock. (Sec.
13, P.D. 49a)
f. Reproduction of Computer Program
Section 189. Reproduction of Computer Program. - 189.1.
Notwithstanding the provisions of Section 177, the
reproduction in one (1) back-up copy or adaptation of a
computer program shall be permitted, without the
authorization of the author of, or other owner of copyright
in, a computer program, by the lawful owner of that
computer program: Provided, That the copy or adaptation
is necessary for:
(a) The use of the computer program in conjunction
with a computer for the purpose, and to the extent, for
which the computer program has been obtained; and
(b) Archival purposes, and, for the replacement of
the lawfully owned copy of the computer program in the
event that the lawfully obtained copy of the computer
program is lost, destroyed or rendered unusable.
189.2. No copy or adaptation mentioned in this Section
shall be used for any purpose other than the ones
determined in this Section, and any such copy or
adaptation shall be destroyed in the event that continued
possession of the copy of the computer program ceases to
be lawful.
189.3. This provision shall be without prejudice to the
application of Section 185 whenever appropriate.
g. Importation for Personal Purposes
NOTE: RA No. 10372, SEC. 14. Sections 190.1. and
190.2. of Republic Act No. 8293 are deleted in their
entirety.
RA No. 10372, SEC. 15. Section 190.3. of Republic Act
No. 8293 is hereby renumbered and amended as the sole
provision under Section 190 to read as follows:
SEC 190. Importation and Exportation of Infringing
Materials. Subject to the approval of the Secretary of
Finance, the Commissioner of Customs is hereby
empowered to make rules and regulations for preventing
the importation or exportation of infringing articles
prohibited under Part IV of this Act and under relevant
treaties and conventions to which the Philippines may be a
party and for seizing and condemning and disposing of the
same in case they are discovered after they have been
imported or before they are exported. (Sec. 30, P.D. No.
49)
10. Registration and Deposit with National Library
and Supreme Court Library
RA No. 10372, SEC 16. Section 191 of Republic Act No.
8293 is hereby amended to read as follows:
SEC 191. Deposit and Notice of Deposit with the National
Library and the Supreme Court Library. At any time
during the subsistence of the copyright, the owner of the

copyright or of any exclusive right in the work may, for the


purpose of completing the records of the National Library
and the Supreme Court Library, register and deposit with
them, by personal delivery or by registered mail, two (2)
complete copies or reproductions of the work in such
form as the Directors of the said libraries may
prescribe in accordance with regulations: Provided,
That only works in the field of law shall be deposited with
the Supreme Court Library. Such registration and deposit
is not a condition of copyright protection.
-Old law only provides: those enumerated in the
provisionspecific works must be deposited; unlike in
the
present law provides all works (but it can
deposited by photograph)
Section 227. Ownership of Deposit and Instruments. - All
copies deposited and instruments in writing filed with the
National Library and the Supreme Court Library in
accordance with the provisions of this Act shall become the
property of the Government. (Sec. 60, P.D. No. 49)
Section 228. Public Records. - The section or division of
the National Library and the Supreme Court Library
charged with receiving copies and instruments deposited
and with keeping records required under this Act and
everything in it shall be opened to public inspection. The
Director of the National Library is empowered to issue such
safeguards and regulations as may be necessary to
implement this Section and other provisions of this Act.
(Sec. 61, P.D. No. 49)
11. Moral rights
Moral Rights of the author are as follows:
1. Right to attribution or paternity right;
2. Right of alteration or non-publication;
3. Right to preservation of integrity;
4. Right not to be identified with work of others or
with distorted work
Moral Right- is independent with economic rights;
Moral Rights cannot be transferred, however, can be a
subject of a waiver.
Except waiver cannot be effective: See: Section 195
a. Scope of Moral Rights
Section 193. Scope of Moral Rights. - The author of a work
shall, independently of the economic rights in Section 177
or the grant of an assignment or license with respect to
such right, have the right:
193.1. To require that the authorship of the works be
attributed to him, in particular, the right that his name, as
far as practicable, be indicated in a prominent way on the
copies, and in connection with the public use of his work;
193.2. To make any alterations of his work prior to, or to
withhold it from publication;
193.3. To object to any distortion, mutilation or other
modification of, or other derogatory action in relation to, his
work which would be prejudicial to his honor or reputation;
and
193.4. To restrain the use of his name with respect to any
work not of his own creation or in a distorted version of his
work. (Sec. 34, P.D. No. 49)
b. Breach of Contract

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Section 194. Breach of Contract. - An author cannot be


compelled to perform his contract to create a work or for
the publication of his work already in existence. However,
he may be held liable for damages for breach of such
contract. (Sec. 35, P.D. No. 49)
NOTE:
c. Waiver of Moral Rights
Section 195. Waiver of Moral Rights. - An author may
waive his rights mentioned in Section 193 by a written
instrument, but no such waiver shall be valid where its
effects is to permit another:
195.1. To use the name of the author, or the title of his
work, or otherwise to make use of his reputation with
respect to any version or adaptation of his work which,
because of alterations therein, would substantially tend to
injure the literary or artistic reputation of another author; or
195.2. To use the name of the author with respect to a work
he did not create. (Sec. 36, P.D. No. 49)

under this Act after the lapse of four (4) years from the
time the cause of action arose. (Sec. 58, P.D. No. 49).
12. Rights to Proceed in Subsequent Transfers
a. Sale or Lease of Work
Section 200. Sale or Lease of Work. - In every sale or
lease of an original work of painting or sculpture or of
the original manuscript of a writer or composer,
subsequent to the first disposition thereof by the author, the
author or his heirs shall have an inalienable right to
participate in the gross proceeds of the sale or lease to
the extent of five percent (5%). This right shall exist
during the lifetime of the author and for fifty (50) years
after his death. (Sec. 31, P.D. No. 49)
Section 201. Works Not Covered. - The provisions of this
Chapter shall not apply to prints, etchings, engravings,
works of applied art, or works of similar kind wherein
the author primarily derives gain from the proceeds of
reproductions. (Sec. 33, P.D. No. 49)
13. Rights of Performers, Producers of Sound
Recordings and Broadcasting Organizations

d. Contribution to Collective Work


a. Definitions
Section 196. Contribution to Collective Work. - When an
author contributes to a collective work, his right to have his
contribution attributed to him is deemed waived unless he
expressly reserves it. (Sec. 37, P.D. No. 49)

Section 202. Definitions. - For the purpose of this Act, the


following terms shall have the following meanings:
202.1. "Performers" are actors, singers, musicians,
dancers, and other persons who act, sing, declaim, play in,
interpret, or otherwise perform literary and artistic work;

e. Term of Moral Rights


RA No. 10372, SEC. 17. Section 198 of Republic Act No.
8293 is hereby amended to read as follows:
SEC. 198. Term of Moral Rights. 198.1. The right of an
author under Section 193.1. shall last during the lifetime of
the author and in perpetuity after his death while the rights
under Sections 193.2. 193.3. and 193.4. shall be
coterminous with the economic rights, the moral rights
shall not be assignable or subject to license. The person or
persons to be charged with the posthumous enforcement
of these rights shall be named in a written instrument
which shall be filed with the National Library. In default of
such person or persons, such enforcement shall devolve
upon either the authors heirs, and in default of the heirs,
the Director of the National Library.
198.2. For purposes of this Section, "Person" shall mean
any individual, partnership, corporation, association, or
society. The Director of the National Library may prescribe
reasonable fees to be charged for his services in the
application of provisions of this Section. (Sec. 39, P.D. No.
49)
Section 199. Enforcement Remedies. - Violation of any of
the rights conferred by this Chapter shall entitle those
charged with their enforcement to the same rights and
remedies available to a copyright owner. In addition,
damages which may be availed of under the Civil Code
may also be recovered. Any damage recovered after the
creator's death shall be held in trust for and remitted to
his heirs, and in default of the heirs, shall belong to the
government. (Sec. 40, P D No. 49)
RA No. 10372, SEC. 26. Section 226 of Republic Act No.
8293 is hereby amended to read as follows:
SEC. 226. Damages. No damages may be recovered

202.2. "Sound recording" means the fixation of the sounds


of a performance or of other sounds, or representation of
sound, other than in the form of a fixation incorporated in a
cinematographic or other audiovisual work;
202.3. An "audiovisual work or fixation" is a work that
consists of a series of related images which impart the
impression of motion, with or without accompanying
sounds, susceptible of being made visible and, where
accompanied by sounds, susceptible of being made
audible;
202.4. "Fixation" means the embodiment of sounds, or of
the representations thereof, from which they can be
perceived, reproduced or communicated through a device;
202. 5. "Producer of a sound recording" means the person,
or the legal entity, who or which takes the initiative and has
the responsibility for the first fixation of the sounds of a
performance or other sounds, or the representation of
sounds;
202.6. "Publication of a fixed performance or a sound
recording" means the offering of copies of the fixed
performance or the sound recording to the public, with the
consent of the right holder: Provided, That copies are
offered to the public in reasonable quality;
202.7. "Broadcasting" means the transmission by wireless
means for the public reception of sounds or of images or of
representations thereof; such transmission by satellite is
also "broadcasting" where the means for decrypting are
provided to the public by the broadcasting organization or
with its consent;
202.8. "Broadcasting organization" shall include a natural
31

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

person or a juridical entity duly authorized to engage in


broadcasting; and
202.9 "Communication to the public of a performance or a
sound recording" means the transmission to the public, by
any medium, otherwise than by broadcasting, of sounds of
a performance or the representations of sounds fixed in a
sound recording. For purposes of Section 209,
"communication to the public" includes making the sounds
or representations of sounds fixed in a sound recording
audible to the public.

fifty (50) years after his death, by his heirs, and in default
of heirs, the government, where protection is claimed.
(Sec. 43, P.D. No. 49)
d. limitation on Performers' Rights
Section 205. Limitation on Right. - 205.1. Subject to the
provisions of Section 206, once the performer has
authorized the broadcasting or fixation of his
performance, the provisions of Sections 203 shall have
no further application.

b. Scope of Performers' Rights

Sec. 203Scope of Performers' Rights

Section 203. Scope of Performers' Rights. - Subject to the


provisions of Section 212, performers shall enjoy the
following exclusive rights:

205.2. The provisions of Section 184 and Section 185 shall


apply mutatis mutandis to performers.

203.1. As regards their performances, the right of


authorizing:
(a) The broadcasting and other communication to the
public of their performance; and
(b) The fixation of their unfixed performance.
RA No. 10372, SEC. 18. Section 203 of Republic Act No.
8293 is hereby amended to read as follows;
x x x
203.2. The right of authorizing the direct or indirect
reproduction of their performances fixed in sound
recordings or audiovisual works or fixations in any manner
or form;
203.3. Subject to the provisions of Section 206, the right
of authorizing the first public distribution of the original and
copies of their performance fixed in sound recordings or
audiovisual works or fixations through sale or rental of
other forms of transfer of ownership;
203.4. The right of authorizing the commercial rental to
the public of the original and copies of their performances
fixed in sound recordings or audiovisual works or
fixations, even after distribution of them by, or
pursuant to the authorization by the performer; and
203.5. The right of authorizing the making available to
the public of their performances fixed in sound
recordings or audiovisual works or fixations, by wire
or wireless means, in such a way that members of the
public may access them from a place and time individually
chosen by them. (Sec. 42, P.D. No. 49A).

e.
Additional
Remuneration
Communications or Broadcasts

for

Subsequent

Section 206. Additional Remuneration for Subsequent


Communications or Broadcasts. - Unless otherwise
provided in the contract, in every communication to the
public or broadcast of a performance subsequent to
the first communication or broadcast thereof by the
broadcasting organization, the performer shall be
entitled to an additional remuneration equivalent to at
least five percent (5%) of the original compensation he
or she received for the first communication or
broadcast. (n)
f. Contract Terms
Section 207. Contract Terms. - Nothing in this Chapter
shall be construed to deprive performers of the right to
agree by contracts on terms and conditions more
favorable for them in respect of any use of their
performance. (n)
g. Scope and Limitation of Right on Sound Recordings
Section 208. Scope of Right. - Subject to the provisions of
Section 212, producers of sound recordings shall enjoy the
following exclusive rights:
208.1. The right to authorize the direct or indirect
reproduction of their sound recordings, in any manner
or form; the placing of these reproductions in the market
and the right of rental or lending;
208.2. The right to authorize the first public distribution of
the original and copies of their sound recordings through
sale or rental or other forms of transferring ownership; and

c. Moral Rights of Performers


Section 204. Moral Rights of Performers.
RA NO. 10372, SEC. 19. Section 204.1. of Republic Act
No. 8293 is hereby amended to read as follows;
204.1. Independently of a performers economic rights,
the performer shall, as regards his live aural performances
or performances fixed in sound recordings or in audiovisual
works or fixations, have the right to claim to be identified
as the performer of his performances, except where the
omission is dictated by the manner of the use of the
performance, and to object to any distortion, mutilation or
other modification of his performances that would be
prejudicial to his reputation.
204.2. The rights granted to a performer in accordance
with Subsection 203.1 shall be maintained and exercised

208.3. The right to authorize the commercial rental to the


public of the original and copies of their sound recordings,
even after distribution by them by or pursuant to
authorization by the producer. (Sec. 46, P.D. No. 49a)
RA NO. 10372, SEC. 20. Section 208 of Republic Act No.
8293 is hereby amended to read as follows:

SEC. 208. Scope of Right. x x x


208.4. The right to authorize the making available to the
public of their sound recordings in such a way that
members of the public may access the sound recording
from a place and at a time individually chosen or selected
by them, as well as other transmissions of a sound
recording with like effect.

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Section 210. Limitation of Right. - Sections 184 and 185


shall apply mutatis mutandis to the producer of sound
recordings. (Sec. 48, P.D. No. 49a)
h. Communication to the Public on Sound Recordings
Section 209. Communication to the Public. - If a sound
recording published for commercial purposes, or a
reproduction of such sound recording, is used directly for
broadcasting or for other communication to the public, or is
publicly performed with the intention of making and
enhancing profit, a single equitable remuneration for the
performer or performers, and the producer of the sound
recording shall be paid by the user to both the performers
and the producer, who, in the absence of any agreement
shall share equally. (Sec. 47, P.D. No. 49a)
i. Scope of Right of Broadcasting Organizations
Section 211. Scope of Right. - Subject to the provisions of
Section 212, broadcasting organizations shall enjoy the
exclusive right to carry out, authorize or prevent any of the
following acts:
211.1. The rebroadcasting of their broadcasts;
211.2. The recording in any manner, including the making
of films or the use of video tape, of their broadcasts for the
purpose of communication to the public of television
broadcasts of the same; and
211.3. The use of such records for fresh transmissions or
for fresh recording. (Sec. 52, P.D. No. 49)

copyright shall be protected for fifty (50) years from the


date on which the work was first lawfully published:
Provided, That where, before the expiration of the said
period, the author's identity is revealed or is no longer in
doubt, the provisions of Subsections 213.1. and 213.2 shall
apply, as the case may be: Provided, further, That such
works if not published before shall be protected for fifty (50)
years counted from the making of the work. (Sec. 23, P.D.
No. 49)
213.4. In case of works of applied art the protection shall
be for a period of twenty-five (25) years from the date of
making. (Sec. 24(B), P.D. No. 49a)
213.5. In case of photographic works, the protection shall
be for fifty (50) years from publication of the work and, if
unpublished, fifty (50) years from the making. (Sec. 24(C),
P.D. 49a)
213.6. In case of audio-visual works including those
produced by process analogous to photography or any
process for making audio-visual recordings, the term shall
be fifty (50) years from date of publication and, if
unpublished, from the date of making. (Sec. 24(C), P.D.
No. 49a)
- Joint Authorship
Section 213.2. In case of works of joint authorship, the
economic rights shall be protected during the life of the last
surviving author and for fifty (50) years after his death.
(Sec. 21, second sentence, P.D. No. 49)

j. Limitations on Rights
- Anonymous or Pseudonymous Works
RA NO 8293, Section 212. Limitations on Rights. Sections 203, 208 and 209 shall not apply where the acts
referred to in those Sections are related to:
212.1. The use by a natural person exclusively for his own
personal purposes;
212.2. Using short excerpts for reporting current events;
212.3. Use solely for the purpose of teaching or for
scientific research; and
212.4. Fair use of the broadcast subject to the conditions
under Section 185. (Sec. 44, P.D. No. 49a)
RA NO. 10372, SEC. 21. Section 212 of Republic Act No.
8293 is hereby amended to read as follows:
SEC. 212. Limitations on Rights. The provisions of
Chapter VIII shall apply mutatis mutandis to the rights of
performers, producers of sound recordings and
broadcasting organizations.

Section 213.3. In case of anonymous or pseudonymous


works, the copyright shall be protected for fifty (50) years
from the date on which the work was first lawfully
published: Provided, That where, before the expiration of
the said period, the author's identity is revealed or is no
longer in doubt, the provisions of Subsections 213.1. and
213.2 shall apply, as the case may be: Provided, further,
That such works if not published before shall be protected
for fifty (50) years counted from the making of the work.
(Sec. 23, P.D. No. 49)
- Works of Applied Art
Section 213.4. In case of works of applied art the
protection shall be for a period of twenty-five (25) years
from the date of making. (Sec. 24(B), P.D. No. 49a)
- Photographic Works

14. Term of Protection in General


a. Term of Protection
Section 213. Term of Protection. - 213.1. Subject to the
provisions of Subsections 213.2 to 213.5, the copyright in
works under Sections 172 and 173 shall be protected
during the life of the author and for fifty (50) years after his
death. This rule also applies to posthumous works. (Sec.
21, first sentence, P.D. No. 49a)
213.2. In case of works of joint authorship, the economic
rights shall be protected during the life of the last surviving
author and for fifty (50) years after his death. (Sec. 21,
second sentence, P.D. No. 49)

Section 213.5. In case of photographic works, the


protection shall be for fifty (50) years from publication of
the work and, if unpublished, fifty (50) years from the
making. (Sec. 24(C), P.D. 49a)
- Audiovisual Works
Section 213.6. In case of audio-visual works including
those produced by process analogous to photography or
any process for making audio-visual recordings, the term
shall be fifty (50) years from date of publication and, if
unpublished, from the date of making. (Sec. 24(C), P.D.
No. 49a)
- Calculation of Terms

213.3. In case of anonymous or pseudonymous works, the


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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Section 214. Calculation of Term. - The term of protection


subsequent to the death of the author provided in the
preceding Section shall run from the date of his death or of
publication, but such terms shall always be deemed to
begin on the first day of January of the year following the
event which gave rise to them. (Sec. 25, P.D. No. 49)
b. Term of protection for Performers, Producers and
Broadcasting Organizations
Section 215. Term of Protection for Performers, Producers
and Broadcasting Organizations. - 215.1. The rights
granted to performers and producers of sound recordings
under this law shall expire:
(a) For performances not incorporated in
recordings, fifty (50) years from the end of the year in
which the performance took place; and
(b) For sound or image and sound recordings and
for performances incorporated therein, fifty (50) years from
the end of the year in which the recording took place.
215.2. In case of broadcasts, the term shall be twenty (20)
years from the date the broadcast took place. The
extended term shall be applied only to old works with
subsisting protection under the prior law. (Sec. 55, P.D. No.
49a)
15. Infringement
a. How committed
RA No. 10372, SEC. 22. Section 216 of Republic Act No.
8293 is hereby amended to read as follows:
SEC. 216. Infringement. A person infringes a right
protected under this Act when one:
(a) Directly commits an infringement;
(b) Benefits from the infringing activity of another person
who commits an infringement if the person benefiting has
been given notice of the infringing activity and has the right
and ability to control the activities of the other person;
(c) With knowledge of infringing activity, induces, causes
or materially contributes to the infringing conduct of
another.
NOTES:
Infringement of copyright consists in the doing by any
person, without the consent of the owner of the copyright,
of anything the sole right to do which is conferred by
statute on the owner of the copyright (Microsoft Corp. vs.
Hwang)
Usual remedy: Injuction
Copyright infringement and unfair competition are not
limited to the act of selling counterfeit goods. They cover
the whole range of acts, from copying, assembling,
packaging to marketing, including the mere offering for sale
of the counterfeit (Microsoft Corp. vs. Maxicorp Inc.)
Mere act of reproduction-included! (as long as he
(infringer) performs the acts that belong to the owner he is
liable copyright infringement)
CASES:

Microsoft Corp. vs. Hwang


(G.R. No. 147043, June 21, 2005)
FACTS: In May 1993, Microsoft and Beltron
Computer Philippines, Inc. entered into a
Licensing Agreement. Under Section 2(a) of the
Agreement Microsoft authorized Beltron, for a fee,
to:
1. Reproduce and install no more than one
copy of Windows on each Customer
System hard disk;
2. Distribute directly or indirectly and license
copies of Windows (reproduced as per
Section 2 of the Agreement and/or
acquired from an Authorized Replicator or
Authorized Distributor.
Their agreement allowed either party to terminate
if one fails to comply with their respective
obligations. Microsoft terminated the Agreement in
June 1995 by reason of Beltrons non-payment of
royalties. Later, Microsoft learned that Beltron was
illegally copying and selling copies of Windows.
Microsoft then sought the assistance of the
National Bureau of Investigation. NBI agents
made some purchase from Beltron where they
acquired a computer unit pre-installed with
Windows, 12 windows installer CDs packed as
Microsoft products. The agents were not given the
end-user license agreements, user manuals, and
certificates of authenticity for the products
purchased. They were given a receipt which has a
header of T.M.T.C. (Phils) Inc. BELTRON
COMPUTER. TMTC stands for Taiwan Machinery
Display and Trade Center.
A search warrant was subsequently issued where
2,831 CDs of Windows installers, among others,
were seized. Based on the items seized from
Beltron, Microsoft filed a case of copyright
infringement against Beltron and TMTC as well as
their officers (Hwang et al) before the Department
of Justice (DOJ). Beltron, in its counter-affidavit,
argued the following:
1. That Microsofts issue with Beltron was
really just to have leverage in forcing
Beltron to pay the unpaid royalties; and
that Microsoft should have filed a
collection suit.
2. That the computer unit allegedly
purchased by the NBI agents from them
cannot be decisively traced as coming
from Beltron because the receipt issued to
the agents did not list the computer unit as
one of the items bought.
3. That the 12 installers purchased by the
agents which are actually listed in the
receipt were not manufactured by Beltron
but rather they were genuine copies
purchased by TMTC from an authorized
Microsoft seller in Singapore.
4. That the 2,831 installers seized from them
were not a property of Beltron but rather
they were left to them by someone for
safekeeping.
The DOJ secretary agreed with Beltron and
dismissed the case. The Secretary ruled that the
issue of the authority of Beltron to copy and sell

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Microsoft products should first be resolved in a


civil suit. Microsoft appealed the decision of the
DOJ secretary before the Supreme Court.
Meanwhile, Beltron filed a motion to quash the
search warrant before the RTC that issued the
same. The RTC partially granted the quashal. The
Court of Appeals reversed the RTC. Hwang et al
did not appeal the CA decision.
ISSUE: Whether or not the DOJ Secretary is
correct.
HELD: No. Section 5[39] of PD 49 (Section 5)
enumerates the rights vested exclusively on the
copyright owner. Contrary to the DOJs ruling, the
gravamen of copyright infringement is not
merely the unauthorized manufacturing of
intellectual works but rather the unauthorized
performance of any of the acts covered by
Section 5.
Section 5 Copyright shall consist in the exclusive
right[:]
(A) To print, reprint, publish, copy, distribute,
multiply, sell, and make photographs, photoengravings, and pictorial illustrations of the works;
(B) To make any translation or other version or
extracts or arrangements or adaptations thereof;
to dramatize it if it be a non-dramatic work; to
convert it into a non-dramatic work if it be a
drama; to complete or execute it if it be a model
or design;
(C) To exhibit, perform, represent, produce, or
reproduce the work in any manner or by any
method whatever for profit or otherwise; if not
reproduced in copies for sale, to sell any
manuscripts or any records whatsoever thereof;
(D) To make any other use or disposition of the
work consistent with the laws of the land. This
has been superseded by Section 177 of RA 8293
Hence, any person who performs any of the
acts under Section 5 without obtaining the
copyright owners prior consent renders
himself civilly and criminally liable for
copyright infringement. We held in Columbia
Pictures, Inc. v. Court of Appeals:
Infringement of a copyright is a trespass on a
private domain owned and occupied by the owner
of the copyright, and, therefore, protected by law,
and infringement of copyright, or piracy, which is a
synonymous term in this connection, consists in
the doing by any person, without the consent of
the owner of the copyright, of anything the sole
right to do which is conferred by statute on the
owner of the copyright.
Significantly, under Section 5(A), a copyright
owner is vested with the exclusive right to copy,
distribute, multiply, [and] sell his intellectual
works.
Being the copyright and trademark owner of
Microsoft software, Microsoft acted well within its
rights in filing the complaint before DOJ on the
incriminating evidence obtained from Beltron.
Hence, it was highly irregular for the DOJ to hold
that Microsoft sought the issuance of the search

warrants and the filing of the complaint merely to


pressure Beltron to pay its overdue royalties to
Microsoft.
There is no basis for the DOJ to rule that
Microsoft must await a prior resolution from the
proper court of whether or not the Agreement is
still binding between the parties. Beltron has not
filed any suit to question Microsofts termination of
the Agreement. Microsoft can neither be expected
nor compelled to wait until Beltron decides to sue
before Microsoft can seek remedies for violation
of its intellectual property rights.
Furthermore, the articles seized from Beltron are
counterfeit per se because Microsoft does not
(and could not have authorized anyone to)
produce such CD installers The copying of the
genuine Microsoft software to produce these fake
CDs and their distribution are illegal even if the
copier or distributor is a Microsoft licensee. As far
as these installer CD-ROMs are concerned, the
Agreement (and the alleged question on the
validity of its termination) is immaterial to the
determination of Beltrons liability for copyright
infringement and unfair competition. Beltrons
defense that the box of CD installers found in their
possession was only left to them for safekeeping
is not tenable.

Microsoft Corp. vs. Maxicorp Inc.


(438 SCRA 224)
FACTS: NBI Agent Samiano, Jr. filed several
applications for search warrants in the RTC
against Maxicorp for alleged violation of Section
29 of PD 49 and Article 189 of the RPC. After
conducting a preliminary examination of the
applicant and his witnesses, Judge William M.
Bayhon issued Search Warrants against
Maxicorp.
Armed with the search warrants, NBI agents
conducted a search of Maxicorps premises and
seized property fitting the description stated in the
search warrants. Maxicorp filed a motion to quash
the search warrants alleging that there was no
probable cause for their issuance and that the
warrants are in the form of general warrants.
RTC denied Maxicorps motion and also denied
Maxicorps motion for reconsideration.
The RTC found probable cause to issue the
search warrants after examining NBI Agent
Samiano, Sacriz, and computer technician Pante .
The three testified on what they discovered during
their respective visits to Maxicorp. NBI Agent
Samiano also presented certifications from
petitioners that they have not authorized Maxicorp
to perform the witnessed activities using
petitioners products.
Maxicorp filed a petition for certiorari with the
Court of Appeals seeking to set aside the RTCs
order. CA reversed the RTCs order denying
Maxicorps motion to quash the search warrants.
Petitioners moved for reconsideration. CA denied
petitioners motion
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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

channels of commerce of imported goods that involve an


infringement, immediately after customs clearance of such
goods.

CA held that NBI Agent Samiano failed to present


during the preliminary examination conclusive
evidence that Maxicorp produced or sold the
counterfeit products.
The Court of Appeals
pointed out that the sales receipt NBI Agent
Samiano presented as evidence that he bought
the products from Maxicorp was in the name of a
certain Joel Diaz. Hence, this petition.

(c) Deliver under oath, for impounding during the


pendency of the action, upon such terms and conditions
as the court may prescribe, sales invoices and other
documents evidencing sales, all articles and their
packaging alleged to infringe a copyright and implements
for making them.

ISSUE: Whether or not the Court of Appeals is


correct.

(d) Deliver under oath for destruction without any


compensation all infringing copies or devices, as well
as all plates, molds, or other means for making such
infringing copies as the court may order.

HELD: SC rule that the Court of Appeals erred in


reversing the RTCs findings.
The testimonies of the two witnesses, coupled
with the object and documentary evidence they
presented, are sufficient to establish the existence
of probable cause. From what they have
witnessed, there is reason to believe that
Maxicorp engaged in copyright infringement and
unfair competition to the prejudice of Microsoft.
Both NBI Agent Samiano and Sacriz were clear
and insistent that the counterfeit software were
not only displayed and sold within Maxicorps
premises, they were also produced, packaged
and in some cases, installed there.

(e) Such other terms and conditions, including


payment of moral and exemplary damages, which
court may deem proper, wise and equitable and
destruction of infringing copies of the work even in
event of acquittal in a criminal case.

The fact that the receipt issued was not in


Samianos name nor was it in Sacriz name does
not render the issuance of the warrant void. No
law or rule states that probable cause requires a
specific kind of evidence. No formula or fixed rule
for its determination exists. Probable cause is
determined in the light of conditions obtaining in a
given situation.Thus, it was improper for the Court
of Appeals to reverse the RTCs findings simply
because the sales receipt evidencing NBI Agent
Samianos purchase of counterfeit goods is not in
his name.
The fact that Sacriz did not actually purchase
counterfeit software from Maxicorp does not
eliminate the existence of probable cause.
Copyright infringement and unfair competition
are not limited to the act of selling counterfeit
goods. They cover a whole range of acts, from
copying, assembling, packaging to marketing,
including the mere offering for sale of the
counterfeit goods.
The clear and firm
testimonies of petitioners witnesses on such other
acts stand untarnished. The Constitution and the
Rules of Court only require that the judge examine
personally and thoroughly the applicant for the
warrant and his witnesses to determine probable
cause. The RTC complied adequately with the
requirement of the Constitution and the Rules of
Court.

b. Remedies for Infringement


SEE: RA No. 8293, Section 216. Remedies for
Infringement. - 216.1. Any person infringing a right
protected under this law shall be liable:
(a) To an injunction restraining such infringement. The
court may also order the defendant to desist from an
infringement, among others, to prevent the entry into the

the
the
the
the

RA No. 10372, Section 216.1. Remedies for Infringement.


Any person infringing a right protected under this law
shall be liable:
x x x
(b) To pay to the copyright proprietor or his assigns or
heirs such actual damages, including legal costs and
other expenses, as he may have incurred due to the
infringement as well as the profits the infringer may have
made due to such infringement, and in proving profits the
plaintiff shall be required to prove sales only and the
defendant shall be required to prove every element of cost
which he claims, or, in lieu of actual damages and profits,
such damages which to the court shall appear to be just
and shall not be regarded as penalty: Provided, That the
amount of damages to be awarded shall be doubled
against any person who:
(i) Circumvents effective technological measures;
or
(ii) Having reasonable grounds to know that it will
induce, enable, facilitate or conceal the infringement,
remove or alter any electronic rights management
information from a copy of a work, sound recording, or
fixation of a performance, or distribute, import for
distribution, broadcast, or communicate to the public works
or copies of works without authority, knowing that
electronic rights management information has been
removed or altered without authority.
x x x
The copyright owner may elect, at any time before final
judgment is rendered, to recover instead of actual
damages and profits, an award of statutory damages for all
infringements involved in an action in a sum equivalent to
the filing fee of the infringement action but not less than
Fifty thousand pesos (Php50,000.00). In awarding
statutory damages, the court may consider the following
factors:
(1) The nature and purpose of the infringing act;
(2) The flagrancy of the infringement;
(3) Whether the defendant acted in bad faith;
(4) The need for deterrence;
(5) Any loss that the plaintiff has suffered or is
likely to suffer by reason of the infringement; and
(6) Any benefit shown to have accrued to the
defendant by reason of the infringement.

In case the infringer was not aware and had no reason to


believe that his acts constitute an infringement of
copyright, the court in its discretion may reduce the award
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2 36

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

of statutory damages to a sum of not more than Ten


thousand pesos (Php10,000.00): Provided, That the
amount of damages to be awarded shall be doubled
against any person who:
(i) Circumvents effective technological measures; or
(ii) Having reasonable grounds to know that it will induce,
enable, facilitate or conceal the infringement, remove or
alter any electronic rights management information from a
copy of a work, sound recording, or fixation of a
performance, or distribute, import for distribution,
broadcast, or communicate to the public works or copies of
works without authority, knowing that electronic rights
management information has been removed or altered
without authority.
x x x
216.2. In an infringement action, the court shall also
have the power to order the seizure and impounding of
any article which may serve as evidence in the court
proceedings, in accordance with the rules on search and
seizure involving violations of intellectual property rights
issued by the Supreme Court. (Sec. 28, P.D. No. 49a)
The foregoing shall not preclude an independent suit for
relief by the injured party by way of damages, injunction,
accounts or otherwise.
NOTE: What is the nature of the proceeding? The
owner has the right to sue a civil or criminal action.
Administrative remedy (look Sec. 10.2 IPC)
Complaint filed with the Bureau of Legal Affairs of the
IPO. ...
CASES:
Habana vs. Robles (310 SCRA 522, 1999)
SEE the Facts in the previous discussions
HELD: SC believe that respondent Robles act of
lifting from the book of petitioners substantial
portions of discussions and examples, and her
failure to acknowledge the same in her book is an
infringement of petitioners copyrights.
When is there a substantial reproduction of a
book? It does not necessarily require that the
entire copyrighted work, or even a large
portion of it, be copied. If so much is taken
that the value of the original work is
substantially
diminished,
there
is
an
infringement of copyright and to an injurious
extent, the work is appropriated.
In determining the question of infringement, the
amount of matter copied from the copyrighted
work is an important consideration. To constitute
infringement, it is not necessary that the whole or
even a large portion of the work shall have been
copied. If so much is taken that the value of the
original is sensibly diminished, or the labors of the
original author are substantially and to an injurious
extent appropriated by another, that is sufficient in
point of law to constitute piracy.
Infringement of a copyright is a trespass on a
private domain owned and occupied by the
owner of the copyright, and, therefore,

protected by law, and infringement of


copyright, or piracy, which is a synonymous
term in this connection, consists in the doing
by any person, without the consent of the
owner of the copyright, of anything the sole
right to do which is conferred by statute on
the owner of the copyright.
A copy of a piracy is an infringement of the
original, and it is no defense that the pirate, in
such cases, did not know whether or not he
was infringing any copyright; he at least knew
that what he was copying was not his, and he
copied at his peril.
The next question to resolve is to what extent can
copying be injurious to the author of the book
being copied. Is it enough that there are
similarities in some sections of the books or large
segments of the books are the same?
SC consider as an indicia of guilt or wrongdoing
the act of respondent Robles of pulling out from
Goodwill bookstores the book DEP upon learning
of petitioners complaint while pharisaically
denying petitioners demand. It was further noted
that when the book DEP was re-issued as a
revised version, all the pages cited by petitioners
to contain portion of their book College English for
Today were eliminated.
In cases of infringement, copying alone is not
what is prohibited. The copying must produce
an
injurious effect.
Here, the injury
consists in that respondent Robles lifted from
petitioners book materials that were the result
of the latters research work and compilation
and misrepresented them as her own. She
circulated the book DEP for commercial use
and did not acknowledge petitioners as her
source.
Hence, there is a clear case of appropriation of
copyrighted work for her benefit that respondent
Robles committed. Petitioners work as authors is
the product of their long and assiduous research
and for another to represent it as her own is injury
enough. In copyrighting books the purpose is to
give protection to the intellectual product of an
author. This is precisely what the law on copyright
protected, under Section 184.1 (b). Quotations
from a published work if they are compatible with
fair use and only to the extent justified by the
purpose, including quotations from newspaper
articles and periodicals in the form of press
summaries are allowed provided that the source
and the name of the author, if appearing on the
work, are mentioned.
In the case at bar, the least that respondent
Robles could have done was to acknowledge
petitioners Habana et. al. as the source of the
portions of DEP. The final product of an authors
toil is her book. To allow another to copy the book
without appropriate acknowledgment is injury
enough.
Columbia Pictures Inc. vs. CA

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37

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

under this Chapter, an affidavit made before a notary public


by or on behalf of the owner of the copyright in any work or
other subject matter and stating that:

SEE the Facts in the previous discussions


HELD:

(a) At the time specified therein, copyright subsisted in the


work or other subject matter;

c. Criminal Penalties
Section 217. Criminal Penalties. - 217.1. Any person
infringing any right secured by provisions of Part IV of this
Act or aiding or abetting such infringement shall be guilty of
a crime punishable by:
(a) Imprisonment of one (1) year to three (3) years
plus a fine ranging from Fifty thousand pesos (P50,000) to
One hundred fifty thousand pesos (P150,000) for the first
offense.
(b) Imprisonment of three (3) years and one (1) day
to six (6) years plus a fine ranging from One hundred fifty
thousand pesos (P150,000) to Five hundred thousand
pesos (P500,000) for the second offense.
(c) Imprisonment of six (6) years and one (1) day to
nine (9) years plus a fine ranging from five hundred
thousand pesos (P500,000) to One million five hundred
thousand pesos (P1,500,000) for the third and subsequent
offenses.
RA No. 10372, SEC. 23. Section 217.2. of Republic Act
No. 8293 hereby amended to read as follows:
217.2. In determining the number of years of
imprisonment and the amount of fine, the court shall
consider the value of the infringing materials that the
defendant has produced or manufactured and the damage
that the copyright owner has suffered by reason of the
infringement: Provided, That the respective maximum
penalty stated in Section 217.1. (a), (b) and (c) herein for
the first, second, third and subsequent offense, shall be
imposed when the infringement is committed by:
(a) The circumvention of effective technological
measures;
(b) The removal or alteration of any electronic
rights management information from a copy of a work,
sound recording, or fixation of a performance, by a person,
knowingly and without authority; or
(c) The distribution, importation for distribution,
broadcast, or communication to the public of works or
copies of works, by a person without authority, knowing
that electronic rights management information has been
removed or altered without authority.
RA No. 8293, 217.3. Any person who at the time when
copyright subsists in a work has in his possession an
article which he knows, or ought to know, to be an
infringing copy of the work for the purpose of:
(a) Selling, letting for hire, or by way of trade
offering or exposing for sale, or hire, the article;
(b) Distributing the article for purpose of trade, or
for any other purpose to an extent that will prejudice the
rights of the copyright owner in the work; or
(c) Trade exhibit of the article in public, shall be guilty of an
offense and shall be liable on conviction to imprisonment
and fine as above mentioned. (Sec. 29, P.D. No. 49a)
d. Affidavit Evidence
Section 218. Affidavit Evidence. - 218.1. In an action

(b) He or the person named therein is the owner of the


copyright; and
RA No. 10372, SEC. 24. Section 218.1. of Republic Act
No. 8293 is hereby amended to read as follows:
SEC. 218. Affidavit Evidence. x x x
(c) The copy of the work or other subject matter annexed
thereto is a true copy thereof.
The affidavit shall be admitted in evidence in any
proceedings under this Chapter and shall be prima facie
proof of the matters therein stated until the contrary is
proved, and the court before which such affidavit is
produced shall assume that the affidavit was made by or
on behalf of the owner of the copyright.
NOTES:
To prove the existence of copyright, an Affidavit stating
that-1. Copyright subsisted in the work
2. The person named therein is the owner
3. Copy of the work is annexed
4. Affidavit shall be admitted as prima facie proof of
matter contained therein until the contrary is
proved in infringement cases.
e. Presumption of Authorship
Section 219. Presumption of Authorship. - 219.1. The
natural person whose name is indicated on a work in the
usual manner as the author shall, in the absence of proof
to the contrary, be presumed to be the author of the work.
This provision shall be applicable even if the name is a
pseudonym, where the pseudonym leaves no doubt as to
the identity of the author.
219.2. The person or body corporate whose name appears
on a audio-visual work in the usual manner shall, in the
absence of proof to the contrary, be presumed to be the
maker of said work. (n)
Bayanihan Music Phils., Inc. vs. BMG Records
(G.R. No. 166337, March 7, 2005)
FACTS: Private respondent Jose Mari Chan
(Chan) entered into a contract with petitioner
Bayanihan Music Philippines, Inc. (Bayanihan),
whereunder the former assigned to the latter all
his rights, interests and participation over his
musical composition "Can We Just Stop and Talk
A While". On March 11, 1976, the parties entered
into a similar contract over Chan's other musical
composition entitled "Afraid For Love To Fade".
On the strength of the abovementioned contracts,
Bayanihan applied for and was granted by the
National Library a Certificate of Copyright
Registration for each of the two musical
compositions, thus: November 19, 1973, for the
song "Can We Just Stop and Talk A While" and on
May 21, 1980, for the song "Afraid for Love To

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38

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Fade."
Apparently, without the knowledge and consent of
petitioner Bayanihan, Chan authorized his corespondent BMG Records (Pilipinas) [BMG] to
record and distribute the aforementioned musical
compositions in a then recently released album of
singer Lea Salonga.
In separate letters both, petitioner Bayanihan
informed respondents Chan and BMG of its
existing copyrights over the subject musical
compositions and the alleged violation of such
right by the two. Demands were made on both to
settle the matter with Bayanihan. However no
settlement was reached by the parties.
Hence, Bayanihan filed with theRTC a complaint
against Chan and BMG for violation of Section
216 of Republic Act No. 8293 (IPC) with a prayer
for the issuance of Temporary Restraining Order
(TRO) and/or writ of preliminary injunction,
enjoining respondent BMG from further recording
and distributing the subject musical compositions
in whatever form of musical products, and Chan
from further granting any authority to record and
distribute the same musical compositions.
The lower court came out with an order denying
Bayanihan's prayer for TRO. Thereafter, the same
court, in its subsequent order likewise denied
Bayanihan's prayer for a writ of preliminary
injunction . Its motion for a reconsideration of the
same order also denied by the trial court.
Petitioner Bayanihan then went to the CA on a
petition for certiorari imputing grave abuse of
discretion on the part of the trial court in issuing
the orders denying its prayers for a writ of
preliminary
injunction
and
motion
for
reconsideration, respectively. CA upheld the
challenged orders of the trial court and
accordingly dismissed Bayanihan petition, Hence,
Bayanihan's present recourse.
HELD: Of course, while a clear showing of the
right to an injunctive writ is necessary albeit its
existence need not be conclusively established,as
the evidence required therefor need not be
conclusive or complete, still, for an applicant, like
petitioner Bayanihan, to be entitled to the writ, he
is required to show that he has the ostensible right
to the final relief prayed for in its complaint. Here,
the trial court did not find ample justifications for
the issuance of the writ prayed for by petitioner.
Unquestionably,
respondent
Chan,
being
undeniably the composer and author of the lyrics
of the two (2) songs, is protected by the mere fact
alone that he is the creator thereof, conformably
with Republic Act No. 8293, otherwise known as
the Intellectual Property Code, Section 172.2 of
which reads:
172.2. Works are protected by the sole fact of
their creation, irrespective of their mode or form of
expression, as well as of their content, quality and
purpose.
An examination of petitioner's verified complaint in
light of the two (2) contracts sued upon and the
evidence it adduced during the hearing on the
application for preliminary injunction, yields not

the existence of the requisite right protectable by


the provisional relief but rather a lingering doubt
on whether there is or there is no such right. The
two contracts between petitioner and Chan
relative to the musical compositions subject of the
suit contain the following identical stipulations:
7.
It is also hereby agreed to by the parties herein that in
the event the PUBLISHER [petitioner herein] fails to use in any
manner whatsoever within two (2) years any of the
compositions covered by this contract, then such composition
may be released in favor of the WRITER and excluded from
this contract and the PUBLISHER shall execute the necessary
release in writing in favor of the WRITER upon request of the
WRITER;
xxx

xxx

xxx

9.
This contract may be renewed for a period of two-andone-half (2 1/2) years at the option of the PUBLISHER.
Renewal may be made by the PUBLISHER by advising the
WRITER of such renewal in writing at least five (5) days before
the expiration of this contract.

It would thus appear that the two (2) contracts


expired on October 1, 1975 and March 11, 1978,
respectively, there being neither an allegation,
much less proof, that petitioner Bayanihan ever
made use of the compositions within the two-year
period agreed upon by the parties.
Anent the copyrights obtained by petitioner on the
basis of the selfsame two (2) contracts, suffice it
to say 'that such purported copyrights are not
presumed to subsist in accordance with Section
218[a] and [b], of the Intellectual Property Code,
because respondent Chan had put in issue the
existence thereof.
It is noted that Chan revoked and terminated said
contracts, along with others, on July 30, 1997, or
almost two years before petitioner Bayanihan
wrote its sort of complaint/demand letter dated
December 7, 1999 regarding the recent
"use/recording of the songs Can We Just Stop
and Talk A While' and Afraid for Love to Fade,'" or
almost three (3) years before petitioner filed its
complaint on August 8, 2000, therein praying,
inter alia, for injunctive relief. By then, it would
appear that petitioner had no more right that is
protectable by injunction.
Petition is hereby denied.
f. International Registration of Works
Section 220. International Registration of Works. - A
statement concerning a work, recorded in an international
register in accordance with an international treaty to which
the Philippines is or may become a party, shall be
construed as true until the contrary is proved except:
220.1. Where the statement cannot be valid under this Act
or any other law concerning intellectual property.
220.2. Where the statement is contradicted by another
statement recorded in the international register. (n)
g. Disclosure of Information
RA No. 10372, SEC. 25. A new Section 220A shall be
inserted after Section 220.2. of Republic Act No. 8293 to
read as follows:
SEC. 220A. Disclosure of Information. Where any article
39

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

or its packaging or an implement for making it is seized or


detained under a valid search and seizure under this Act
is, or is reasonably suspected to be, by an authorized
enforcement officer, in violation of this Act, the said officer,
shall, wherever reasonably practicable, notify the owner of
the copyright in question or his authorized agent of the
seizure or detention, as the case may be.
16. Points of Attachment of rights
a. For Literary and Artistic Works and Derivative Works
Section 221. Points of Attachment for Works under
Sections 172 and 173. - 221.1. The protection afforded by
this Act to copyrightable works under Sections 172 and 173
shall apply to:
(a) Works of authors who are nationals of, or have
their habitual residence in, the Philippines;
(b) Audio-visual works the producer of which has
his headquarters or habitual residence in the Philippines;
(c) Works of architecture erected in the Philippines
or other artistic works incorporated in a building or other
structure located in the Philippines;
(d) Works first published in the Philippines; and
(e) Works first published in another country but
also published in the Philippines within thirty days,
irrespective of the nationality or residence of the authors.
221.2. The provisions of this Act shall also apply to works
that are to be protected by virtue of and in accordance with
any international convention or other international
agreement to which the Philippines is a party. (n)

(a) Broadcasts of broadcasting organizations the


headquarters of which are situated in the Philippines; and
(b) Broadcasts transmitted from transmitters
situated in the Philippines.
224.2. The provisions of this Act shall also apply to
performers who, and to producers of sound recordings and
broadcasting organizations which, are to be protected by
virtue of and in accordance with any international
convention or other international agreement to which the
Philippines is a party. (n)
IV. LAW ON PATENTS, UTILITY MODELS AND
INDUSTRIAL DESIGNS
-it deals with inventions and science
-experts in particular field; scientists
Patent is a temporary monopoly granted to an inventor by
the Govt
in return for disclosing an invention.(the
disclosure in a way: how the inventor created such
invention)
The exclusive right to exploit the invention for 20 years
from the filing date, i.e to make, use sell or import an
invention.
TAKE NOTE:
A patent has a term of protection of twenty (20)
years providing an inventor significant commercial
gain. In return, the patent owner must share the full
description of the invention. This information is
made available to the public in the form of the
Intellectual Property Official Gazette and can be
utilized as basis for future research and will in turn
promote innovation and development.

CASE:
Pearl & Dean Inc. vs. Shoemart Inc. (G.R. No.
148222, August 15, 2003)
HELD:

b. For Performers
Section 222. Points of Attachment for Performers. - The
provisions of this Act on the protection of performers shall
apply to:
222.1. Performers who are nationals of the
Philippines;
222.2. Performers who are not nationals of the
Philippines but whose performances:
(a) Take place in the Philippines; or
(b) Are incorporated in sound recordings that are
protected under this Act; or
(c) Which has not been fixed in sound recording
but are carried by broadcast qualifying for protection under
this Act. (n)
c. Of Sound Recordings

Patentable inventions offer a technical solution to a


problem in any field of human activity. However,
theories, mathematical methods, methods of
treatment and artistic creations are NonPatentable inventions.

Patent in two senses:


First, it may refer to the document. If a person
makes an invention, he files an application with the govt to
give him a document which states what the invention is and
that he is the owner. The document is called PATENT.
Second, relates to the content of the protection. If
anyone wishes to...
General types of patents:

Section 223. Points of Attachment for Sound Recordings. The provisions of this Act on the protection of sound
recordings shall apply to:
223.1. Sound recordings the producers of which are
nationals of the Philippines; and
223.2. Sound recordings that were first published in the
Philippines. (n)
d. For Broadcast

Section 224. Points of Attachment for Broadcasts. - 224.1.


The provisions of this Act on the protection of broadcasts
shall apply to:

a. Utility Patent- A utility patent is granted on any


new useful process, machine, or composition of matter, or
any new and useful improvement thereof. This type of
patent protects the invention's structural or functional
features. A utility patent application must describe the
invention so that one skilled in the technology can make
and use it. It must also include claims which define--in
words--what the applicant considers to be the invention. A

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utility patent is awarded for 20 years from the date of filing,


except in the case of provisional patents.
b. Design Patent.-- A design patent protects the
ornamental design for an article of manufacture. It only
protects the appearance of the invention, not its structure
or utilitarian features.
c. Plant Patent.--A plant patent is granted on any
distinct and new variety of an asexually reproduced plant,
including cultivated mutants, hybrids, and newly found
seedlings, othe than a tuber-propagated plant or a plant
found in an uncultivated state. The Philippine law, however,
only provides for "patent-like" protection.
1. Purpose of the Patent Law
CASE:
MANZANO VS. CA 9278 SCRA 688, 1997)
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.

(i) There must be an "invention that can be


considered as a "technical solution of a problem in any field
of human activity"
(ii) The invention must be "industrially applicable"
(iii) The invention must be "new"
(iv) The invention must involve an "inventive step"
(Patentable inventions) may be or may relate to
-product
-process
-(improvement of a product or a process)
Classes of Invention:
a) a useful machine
b) a product
c) or process or an improvement of any of the
foregoing
d) microorganisms
e) nonbiological and microbiological
processes.
(Rule 201, rules and regulations on Inventions)
Technical solution
Technical character:
-of the contribution to the art
*Must relate to technical field
*Must

NOTE:
Purpose of Patent Law:
The patent law ha a three-fold purpose: 'first,
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. (Pearl & Dean (Phil) Inc. vs
Shoemart Inc. et al)
2. Patentability
a. Patentable InventionsSec. 21
Section 21. Patentable Inventions. - Any technical solution
of a problem in any field of human activity which is new,
involves an inventive step and is industrially applicable
shall be Patentable. It may be, or may relate to, a product,
or process, or an improvement of any of the foregoing.
(Sec. 7, R.A. No. 165a)
NOTES:
Q: What may be patented?
A: Any technical solution of a problem in any field of
human activity which is new, involves an inventive step
and is industrially applicable shall be patentable.
TAKE NOTE:
Patentability is the ability of an invention to satisfy the
legal requirements for obtaining a patent. The basic
conditions of patentability, which an application must
meet before a patent is granted, are that the invention
must be novel, contain an inventive step (or be nonobvious), be capable of industrial application and not
be in certain excluded fields. (Dennis Funa Book)
There are four basic requirements for patentability:
(Sec. 21; Rule 200)

There are some that Not purely aesthetic creations but


gives a technical solution to a problem.
ex. Tire; Book binderBinding of books.
InventorSec. 25.2
Sec. 25.2. For the purposes of Subsection 25.1, "inventor"
also means any person who, at the filing date of
application, had the right to the patent. (n)
First Requirement: NoveltySec 23
Section 23. Novelty. . - An invention shall not be
considered new if it forms part of a prior art. (Sec. 9, R.A.
No. 165a)
-The element of " novelty" -- means some new
characteristic that is not part of the body of existing
knowledge in its particular technical field. The body of
existing knowledge is called "prior art"
-The invention must be new. It must not already have been
available to the public. An invention is new if it 'does not
form part of the state of the art' (prior art)
-Therefore, novelty is really a question of whether the
invention has been 'anticipated', for example by a
previous patent, or by publication or use. The anticipating
patent, or publication could have occurred anywhere in
the world.
- Prior ArtSec. 24
Section 24. Prior Art. - Prior art shall consist of:
24.1. Everything which has been made available to the
public anywhere in the world, before the filing date or the
priority date of the application claiming the invention; and
24.2. The whole contents of an application for a patent,
utility model, or industrial design registration, published in
accordance with this Act, filed or effective in the
Philippines, with a filing or priority date that is earlier than

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the filing or priority date of the application: Provided, That


the application which has validly claimed the filing date of
an earlier application under Section 31 of this Act, shall be
prior art with effect as of the filing date of such earlier
application: Provided further, That the applicant or the
inventor identified in both applications are not one and the
same. (Sec. 9, R.A. No. 165a)

An application for patent filed by any person who has


previously applied for the same invention in another
country which by treaty, convention, or law affords similar
privileges to Filipino citizens, shall be considered as filed
as of the date of filing the foreign applications provided,

NOTES:
Q: What is Prior Art?
A: All information that has been disclosed to the public in
any form before a given date.

b. It is filed w/n 12 mos. From the date of foreign


application

Prior Art is defined as a "previously used or published


technology that may be referred to in a patent application
or examination report i.e. (a) in abroad sense, technology
that is relevant to an invention and was publicly available
(e.g. described in a publication or offered for sale) at the
time of an invention was made; or (b) in a narrow sense,
any such technology which would invalidate a patent or
limit its scope.
Anticipation Doctrine, defined
a. An invention is anticipated only if each and every
element in the claim is found, expressly or inherently, in the
prior art.
b. Anticipation exists when the prior art indicates
that a patent application lacks novelty by fully describing
something within a claim.
c. A situation that exists when claimed invention is
not novel in view of the prior art. to anticipate a claimed
invention, a prior art reference (normally one) must teach
every element (or step) of the claim.
Novelty is a question of fact.
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 Office.
Prior Use
-Prior use which is not present in the Philippines, even if
widespread in a foreign country, cannot form part of the
prior art if such use is not disclosed in printed documents
or in any tangible form.

a. The local application expressly claims priority

c. Certified copy of the foreign application filed w/n 6 mos.


From Phil application.
SEE: Sec. 31, IPC
*Filing date or priority date but they are treated as
EFFECTED DATE. -Why is it important? Because we
follow FIRST PRIORITY RULE.
-

Inventive StepSec. 26; 26.2

RA No. 9502, SEC. 6. Section 26 of Republic Act No.


8293, otherwise known as the Intellectual Property Code of
the Philippines, is hereby amended to read as follows:
"SEC. 26. Inventive Step. - 26.1. An invention involves an
inventive step if, having regard to prior art, it is not obvious
to a person skilled in the art at the time of the filing date or
priority date of the application claiming the invention. (n)
"26.2. In the case of drugs and medicines, there is no
inventive step if the invention results from the mere
discovery of a new form or new property of a known
substance which does not result in the enhancement of the
known efficacy of that substance, or the mere discovery of
any new property or new use for a known substance, or
the mere use of a known process unless such known
process results in a new product that employs at least one
new reactant."
NOTES:
INVENTIVE STEP
An invention involves an inventive step, if having regard to
prior art
-It is not to a person skilled in the art.
THIS IS ALSO KNOWN AS THE NON-OBVIOUSNESS
TEST

..
Enabling Dislcosure

OBVIOUSNESS
Not beyond normal progress of technology

A patent application for the invention may still be validly


obtained if the disclosure is not enabling

Follows plainly or logically from the prior art

Ex. Science-fiction novel

Does not require any skill or ability beyond that to be


expected of the person skilled in the art.

The prior art communication must enable an ordinary


mechanic, without the exercise of any ingenuity and
special skill on his part, to construct and put the....
Priority DateSec. 20.6
20.6. "Priority date" means the date of filing of the foreign
application for the same invention referred to in Section 31
of this Act. (n)
NOTES:

SKILLED PERSON
Ordinary practitioner
Aware of common general knowledge in specific art
Has access to everything disclosed as the state of the art
observes developments in related technical field.
...
THREE MAIN STAGES
(PROBLEM-SOLUTION APPROACH)

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Determining the closest prior art;


Establishing the technical problem to be solved;
Deciding whether invention is obvious

B.

Example of the Problem-Solution Approach


Problem: The ear-like handles of coffee cups are often
quite slippery. You can therefore easily drop the cup. The
result can be a stained carpet, table cloth, wooden
floor...Such coffee stains are usually very difficult or
impossible to remove completely.
There are two problem: Subjective and ojective problem.
Objective problem: the slippery problem. (must be
resolved)
Suggested Answer: Change the material. Rubber is used
as material for the handle. This increases the friction
between the handle and the fingers of the user.
Claim: Coffee cup with an ear-like handle characterized in
that the handle is made of rubber.
CASE:
Graham v. John Deere Co. of Kansas City (383
U.S. 1, 1966)
FACTS:
ISSUE:
HELD:
THIRD ELEMENT: Industrial ApplicabilitySec. 27
Section 27. Industrial Applicability. - An invention that can
be produced and used in any industry shall be industrially
applicable. (n)

Invetion is "industrially applicable" if


-it can be produced and used in any kind of
inductry or any activity
- which belongs to the useful or practical arts
-as distinct to the useful or practical...

-invention cannot be purely theoretical


-it must be an invention that can be carried out in
practice.
Thus, if the invention is intended to be a product, that
product must be capable of being...
CASES:
Manzano vs. CA (278 SCRA 688, 1997)
FACTS:
A case of cancellation of Letters of Patent for a gas
burner before the Patent Office was filed by one
Angelita Manzano against Melecia Mandolaris.The
petitioner made the following allegations:
A.

D.
E.

Respondent Mandolaria presented lone witness,


Rolando, where the latter claimed that he used to work
as a supervisor before the United Foundry was was
involved in the construction of several models of
burners, that after several attempts, they were finally
able to perfect the process of manufacturing
lampburners and consequently, filed the patent before
the office. The Director of Patents issued a decision
denying the petition for cancellation and holding that
the evidence 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 they were undated.
The dates when they were distributed to the public
were not indicated and, therefore, were useless prior
art references. The case was brought before the CA
which upheld the decision of the Patent Office. A
petition for Certiorari was subsequently filed before the
SC.
ISSUE: Whether the dismissal is proper where the
patent applied for has no substantial difference
between the model to be patented and those sold by
petitioner.
HELD: SC cannot sustain petitioner.

NOTES:

C.

this patent was not inventive or useful;


The specification of the letters of patent did not
comply with the requirements of Sec 14, RA
No. 165, as amended;
Melecia was not the original, true and actual
inventor of the utility model;
The letters was secured thru fraud;
The utility model has been in existence years
before her application for patent was filed.

The utility model of the gas burner covered in

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 ineffective. 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.
In issuing Letters Patent No. UM-4609 to Madolaria for
an LPG Burner on 22 July 1981, the Philippine Patent
Office 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 first 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. 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.
As found by the Director of Patents, the standard of
evidence sufficient to overcome the presumption of

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legality of the issuance of UM-4609 to 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 respondents 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. 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.
Petitioner has failed to show compelling grounds for a
reversal of the findings and conclusions of the Patent
Office and the Court of Appeals. Petition DISMISSED.
Maguan vs. CA (146 SCRA 107, 1986)
FACTS: Petitioner is doing business under the firm
name and style of SWAN MANUFACTURING" while
private respondent is likewise doing business under the
firm name and style of "SUSANA LUCHAN POWDER
PUFF MANUFACTURING." It is undisputed that
petitioner is a patent holder of powder puff. In a letter,
petitioner informed private respondent that the powder
puffs the latter is manufacturing and selling to various
enterprises particularly those in the cosmetics industry,
resemble Identical or substantially Identical powder
puffs of which the former is a patent holder under
Registration Certification 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. Private respondent
replied stating that her products are different 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. Private respondent assailed
the validity of the patents involved and filed with the
Philippine Patent Office petitions for cancellation of (1)
Utility Model Letter Patent Extension No. UM-109; (2)
Utility Model Letters Patent No. UM-1184; (3) Utility
Model Letters Patent Extension No. UM-110. In view
thereof, petitioner filed a complaint for damages with
injunction and preliminary injunction against private
respondent with the then CFI (RTC now) for infringing
the aforesaid letters patent, and prayed, among others,
that a writ of preliminary injunction be immediately
issued.
Private respondent alleged that the products she is
manufacturing and offering for sale are not Identical, or
even only substantially Identical to the products
covered by petitioner's patents and further alleged that
petitioner's patents in question are void on the following
grounds: (1) at the time of filing 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 filing of applications for the patents
involved, powder puffs 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 filing 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 puff, was
but an limitation of a product well known to the
cosmetics industry since years previous to her filing of
application, and which belonged to no one except to the
general public.
HELD: 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." 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 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 find the patent or
any claim thereof invalid, the Director shall on
certification of the final judgment ... issue an order
cancelling the patent or the claims found invalid and
shall publish a notice thereof in the Official Gazette."
Upon such certification, it is ministerial on the part of
the patent office to execute the judgment.
The burden of proof to substantiate a charge of
infringement is with the plaintiff. But where the plaintiff
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.
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 the Patent
Law) before the date of his application for his patent,
will be fatal to, the validity of the patent when issued.
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
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RA No. 9502, SEC. 5. Section 22 of Republic Act No.


8293, otherwise known as the Intellectual Property Code of
the Philippines, is hereby amended to read as follows:
"SEC. 22. Non-Patentable Inventions. - The following shall
be excluded from patent protection:

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 filed
before the filing of the application for patent therefor.

"22.1. Discoveries, scientific theories and mathematical


methods, and in the case of drugs and medicines, the
mere discovery of a new form or new property of a known
substance which does not result in the enhancement of the
known efficacy of that substance, or the mere discovery of
any new property or new use for a known substance, or
the mere use of a known process unless such known
process results in a new product that employs at least one
new reactant.

Creser Precision Systems Inc. vs. CA (G.R. No.


118708, Feb. 2, 1998)
FACTS: Private respondent is a domestic corporation
engaged in the manufacture, production, distribution
and sale of military armaments, munitions, airmunitions
and other similar materials. Private respondent was
granted by the Bureau of Patents, Trademarks and
Technology Transfer (BPTTT), a Letters Patent No.
UM-6938 covering an aerial fuze.

"For the purpose of this clause, salts, esters, ethers,


polymorphs, metabolites, pure form, particle size, isomers,
mixtures of isomers, complexes, combinations, and other
derivatives of a known substance shall be considered to be
the same substance, unless they differ significantly in
properties with regard to efficacy;

Private respondent, through its president, Mr. Gregory


Floro, Jr., discovered that petitioner submitted samples
of its patented aerial fuze to the 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 sent a letter to petitioner advising it from 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. In response to private
respondents demand, petitioner filed a complaint for
injunction and damages arising from the alleged
infringement before the RTC. The complaint alleged,
among others: that petitioner is the first, true and actual
inventor of an aerial fuze denominated as Fuze, PDR
77 CB4 which is 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 respondents aerial fuze is identical in
every respect to the petitioners fuze; and that the only
difference 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 profiting therefrom,
and/or from performing any other act in connection
therewith or tending to prejudice and deprive it of any
rights, privileges and benefits to which it is duly entitled
as the first, true and actual inventor of the aerial fuze.

"22.2. x x x;
"22.3. x x x;
"22.4. x x x;
"22.5. x x x; and
"22.6. x x x."
RA No. 8293, Section 22. Non-Patentable Inventions. The following shall be excluded from patent protection:
22.2. Schemes, rules and methods of performing mental
acts, playing games or doing business, and programs for
computers;
22.3. Methods for treatment of the human or animal body
by surgery or therapy and diagnostic methods practiced on
the human or animal body. This provision shall not apply to
products and composition for use in any of these methods;
22.4. Plant varieties or animal breeds or essentially
biological process for the production of plants or animals.
This provision shall not apply to micro-organisms and nonbiological and microbiological processes.
Provisions under this subsection shall not preclude
Congress to consider the enactment of a law providing sui
generis protection of plant varieties and animal breeds and
a system of community intellectual rights protection:

HELD: In relation to the topic above.


It was cited in this case the case of Aguas vs. De Leon,
we stated that: The validity of the patent issued by the
Philippine Patent Office in favor of the private
respondent and the question over the investments,
novelty and usefulness of the improved process therein
specified and described are matters which are better
determined by the Philippines patent Office, composed
of experts in their field, have, by the issuance of the
patent in question, accepted the thinness of the private
respondents new tiles as a discovery. There is a
presumption that the Philippine Patent Office has
correctly determined the patentability of the
improvement by the private respondent of the process
in question.

b. Non-Patentable
amended by RA 9502

InventionsSec.22

22.5. Aesthetic creations; and


22.6. Anything which is contrary to public order or morality.
(Sec. 8, R.A. No. 165a)
NOTES:
Excluded from Patent Protection
Unpatentable matters are in the public domain
Discoveries, scientific theories and mathematical
methods; (amenedded RA 9502)

as

~Discoveries, such as the laws of nature, physical (natural)


phenomena, and abstract ideas are not patentable. Thus, a
new mineral discovered in the earth or a new plant found in
the wild is not patentable subject matter. Likewise, Einstein
could not patent his celebrated law that E=mc2 could
Newton have patented the law of gravity. Such
discoveries are manifestaions of...nature, free to all

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45

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

men and reserved exclusively to none."

means any person who, at the filing date of application,


had the right to the patent. (n)

~However, an application to a law of nature or


mathematical formula to a known structure or process
may well be deserving of patent protection.
Schemes, rules and methods of
-Performing mental acts, playing games,
business, amd programs for computers.

Non-prejudicial Disclosures
or

doing

Computer programs are copyrightable under Copyright but


not patentable.

NOTES:

Methods for treatment of the human or animal


body by surgery or theory

What is not patentable is the method not the product used


in the method like medicine is patentable. (medicine for
treatment)

the disclosure within 12 months preceding the effective


date shall not prejudice the applicant on the ground of lack
of novelty if such disclosure was made by:
1. The inventor;
2. A patent office and the information was
published by mistake;
3. A third party which obtained the information
directly or indirectly from the inventor

Diagnostic methods practiced on the human or


animal body

On-sale Rule--Sec. 9 of RA No. 165 had previously


provided:

Plant varieties or animal breeds or essentially


biological process for the production of plants or
animals

Section 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 validly issued patent in the
Philippines granted on an application filed before the filing
of the application for patent therefor.

-Because: relate it to discovery because it is already


provided by the nature, it is not invention per se.--There
must be a human intervention
(except
microorganisms,
non-biological
and
microbiological process)
(R.A No. 9168, Phil Plant Variety Protection Act of 2002)
~A new bacteria, specifically the invention of a humanmade, genetically engineered bacterium capable of
breaking down crude oil, a property which is possessed by
no naturally occurring bacteria, is patentable subject
matter.
Aesthetic creations
You must look whether there is also technical function not
just aesthetic

Anything contrary to public order or morality.


c. Novelty and Non-Prejudicial DisclosureSec. 25

Section 25. Non-Prejudicial Disclosure. . - 25.1. The


disclosure of information contained in the application
during the twelve (12) months preceding the filing date or
the priority date of the application shall not prejudice the
applicant on the ground of lack of novelty if such disclosure
was made by:
(a) The inventor;
(b) A patent office and the information was contained (a) in
another application filed by the inventor and should
not have been disclosed by the office, or (b) in an
application filed without the knowledge or consent of
the inventor by a third party which obtained the
information directly or indirectly from the inventor; or
(c) A third party which obtained the information directly or
indirectly from the inventor.
25.2. For the purposes of Subsection 25.1, "inventor" also

This rule is now provided under Section 23 and 24


of the IPC. Although it no longer expressly mentions the
"sale in the Philippines", sales would still be considered as
making "available to the public" under the said law. Thus,
an inventor loses his right to a patent if he puts his
invention "on sale in the Philippines" before filing a
patent application." His voluntary act or acquiescence in
the public sale and use is an abandonment of his right."
For otherwise, it would allow an inventor to withdraw
existing knowledge from the public use.
3. Right to Patent
a. Right to PatentSec. 28
Section 28. Right to a Patent. - The right to a patent
belongs to the inventor, his heirs, or assigns. When two (2)
or more persons have jointly made an invention, the right
to a patent shall belong to them jointly.
b. First to File ruleSec. 29
Section 29. First to File Rule. - If two (2) or more persons
have made the invention separately and independently of
each other, the right to the patent shall belong to the
person who filed an application for such invention, or where
two or more applications are filed for the same invention, to
the applicant who has the earliest filing date or, the earliest
priority date. (3rd sentence, Sec. 10, R.A. No. 165a.)
NOTES:

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First-to-File rule grants the patent rights to an invention to


the person who first files a patent application for that
invention, whether or not he is the first inventor.

may become a member. (Rule 305, Rules & Regulations


on Inventions)
4. Patent Application
a. ApplicationSec. 32; 32.2; 33

Correlate this Section to Section 68.


Section 68. Remedies of the True and Actual Inventor. - If
a person, who was deprived of the patent without his
consent or through fraud is declared by final court order or
decision to be the true and actual inventor, the court shall
order for his substitution as patentee, or at the option of the
true inventor, cancel the patent, and award actual and
other damages in his favor if warranted by the
circumstances.
c. Invention Created Pursuant to Commission
Sec. 30
Section 30. Inventions Created Pursuant to a
Commission. - 30.1. The person who commissions the
work shall own the patent, unless otherwise provided in the
contract.
30.2. In case the employee made the invention in the
course of his employment contract, the patent shall belong
to:
(a) The employee, if the inventive activity is not a part of his
regular duties even if the employee uses the time, facilities
and materials of the employer.
(b) The employer, if the invention is the result of the
performance of his regularly-assigned duties, unless there
is an agreement, express or implied, to the contrary. (n)
d. Right of PrioritySec. 31
Section 31. Right of Priority. . - An application for patent
filed by any person who has previously applied for the
same invention in another country which by treaty,
convention, or law affords similar privileges to Filipino
citizens, shall be considered as filed as of the date of filing
the foreign application: Provided, That: (a) the local
application expressly claims priority; (b) it is filed within
twelve (12) months from the date the earliest foreign
application was filed; and (c) a certified copy of the foreign
application together with an English translation is filed
within six (6) months from the date of filing in the
Philippines. (Sec. 15, R.A. No. 165a)

Section 32. The Application. - 32.1. The patent application


shall be in Filipino or English and shall contain the
following:
(a) A request for the grant of a patent;
(b) A description of the invention;
(c)Drawings necessary for the understanding of the
invention;
(d) One or more claims; and
(e) An abstract.
32.2. No patent may be granted unless the application
identifies the inventor. If the applicant is not the inventor,
the Office may require him to submit said authority. (Sec.
13, R.A. No. 165a)
Section 33. Appointment of Agent or Representative. - An
applicant who is not a resident of the Philippines must
appoint and maintain a resident agent or representative in
the Philippines upon whom notice or process for judicial or
administrative procedure relating to the application for
patent or the patent may be served. (Sec. 11, R.A. No.
165a)
NOTES:

Drawing requirement- "The applicant for a patent will be


required by law to furnish a drawing of the invention
whenever the nature of the case requires a drawing to
understant the invention. However, the Director, may
require a drawing where the nature of the subject matter
admits of it; this drawing must be filed with the application.
This includes practically all inventions except
compositions of matter or process, but a drawing may
also be useful in the case of many processes."
SEE: Section. 36 --CLAIMS
Section 36. The Claims. - 36.1. The application shall
contain one (1) or more claims which shall define the
matter for which protection is sought. Each claim shall be
clear and concise, and shall be supported by the
description'
36.2. The Regulations shall prescribe the manner of the
presentation of claims. (n)

NOTES:
This 12-month period is known as the priority period.
Subsequent applications filed within the 12-month priority
period will enjoy the same filing date (know as the priority
date) as the first application. These later applications will
also enjoy priority status over all other applications, acts
and disclosures relating to the same invention that are filed
after the priority date.The withdrawal or abandonment of
the first application (the priority application), or the
revocation of the first patent (the priority patent) does not
affect the priority status of the subsequent applications that
rely on the earlier patent.
The six-month period may be extended by the Director for
a maximum of six months upon showing of good cause or
in compliance with treaties to which the Philippines is or

Notes:
Claims are statements in a patent in which the inventor
defines his or her invention. "Claims are short and concise
statements, expressed with great formality, of the metes
and bounds of the patented invention. "Claims must define
patented device with sufficient certainty that one skilled in
art can determine whether any particular proposed device
falls within their metes and bound, as weel as what
features must be omitted if claims are not to be infringed. A
claim is the "part of a patent document which defines the
matter for which protection is sought or granted.
Patent Claims--are clear and concise statements which
explain the characteristics of the invention and the

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protection being claimed.

of the applicant or resident agent/representative.

Section 37. The Abstract. - The abstract shall consist of a


concise summary of the disclosure of the invention as
contained in the description, claims and drawings in
preferably not more than one hundred fifty (150) words. It
must be drafted in a way which allows the clear
understanding of the technical problem, the gist of the
solution of that problem through the invention, and the
principal use or uses of the invention. The abstract shall
merely serve for technical information.
SEE ALSO:
Section 41. According a Filing Date. - The Office shall
examine whether the patent application satisfies the
requirements for the grant of date of filing as provided in
Section 40 hereof. If the date of filing cannot be accorded,
the applicant shall be given an opportunity to correct the
deficiencies in accordance with the implementing
Regulations. If the application does not contain all the
elements indicated in Section 40, the filing date should
be that date when all the elements are received. If the
deficiencies are not remedied within the prescribed
time limit, the application shall be considered
withdrawn. (n)
*Without the payment of filing fee you cannot have a filing
date.
Inventor must be named. (Pursuant to Sections 32.2
and 34)
Rules & Regulations on Inventions
Rule 400 The Patent Application An application for a
patent shall be in Filipino or English and shall be filed in
writing either directly to the Bureau or by post and must
be addressed to the Director. The application shall
contain the following: (a) A request for the grant of a
patent; (b) A description of the invention; (c) Drawing(s)
necessary for the understanding of the invention; (d)
One or more claims; and (e) An abstract.
Rule 401 Payment of Fees An application shall be
subject to the payment of the filing fee, the search fee
and publication fee (1st publication) within one month
after the filing date of the application. The application
shall be deemed forfeited for non-payment of these
fees.
Rule 402 Marking of Documents; Acknowledgment The
Bureau shall mark the documents making up the
application with the date of the receipt. After receipt of
the full payment of the required fees, the Bureau may
issue an acknowledgment stating the application
number, name of applicant and title of the invention.
Rule 403 Form of Request; Office Application Form The
request shall be made on a form drawn up by the
Office. For the convenience of applicants, the Office
shall draw up and make available a standard
application form which may be reproduced at will by
applicants and other persons at their own cost.
Rule 404 The Request The request shall contain the
following: (a) Petition for the grant of a patent; (b)
Applicants name and address; (c) Title of the invention;
(d) Inventors name; (e) If with claim for convention
priority it shall contain the file number, country of origin
and the date of filing in the said country where the
application was first filed; (f) Name and address of the
resident agent/representative (if any); and (g) Signature

Who may apply for a Patent?


Rule 500 Who may Apply for a Patent Any person,
natural or juridical, may apply for a patent. If the applicant
is not the inventor, the Office may require him to submit
proof of his authority to apply for a patent.
Rule 501 When the Applicant Dies, Becomes Insane In
case the applicant dies, becomes insane or incapacitated,
the legally appointed administrator, executor, guardian,
conservator, or representative of the applicant, may sign
the application papers and other documents, and apply for
and obtain the patent in the name of the applicant, his heirs
or assignee.
Rule 502 Assigned Invention and Patents In case the
whole interest in the invention is assigned, the application
may be filed by or in the name of the assignee who may
sign the application. In case the assignee is a juridical
person, any officer thereof may sign the application in
behalf of the said person. In case of an aliquot portion or
undivided interest, any of the joint owners will sign the
application.
Rule 503 Juridical Person -- Definition A juridical person is
a body of persons, a corporation, a partnership, or other
legal entity that is recognized by law which grants a
juridical personality separate and distinct from that of a
share holder, partner or member.
Rule 504 Proof of Authority If the person who signs the
application in behalf of a juridical person is an officer of the
corporation, no proof of authority to file the said application
will be required. However, if any other person signs for and
in behalf of a juridical person, the Bureau shall require him
to submit proof of authority to sign the application. If the
applicant appoints a representative to prosecute and sign
the application, the Bureau shall require proof of such
authority.
Rule 505 Forms of Signatures Where a signature is
required, the Office may accept: (a) A hand-written
signature; or (b) The use of other forms of signature, such
as a printed or stamped signature, or the use of a seal, or
thumbmarks, instead of a hand-written signature. Provided,
that where a seal or a thumbmark is used, it should be
accompanied by an indication in letters of the name of the
signatory. No attestation, notarization, legalization or other
certification of any signature or other means of selfidentification referred to in the preceding paragraphs, will
be required, except, where the signature concerns the
surrender of a letters patent.
b. Disclosure and Description of InventionSec.
35

Section 35. Disclosure and Description of the Invention. 35.1. Disclosure. - The application shall disclose the
invention in a manner sufficiently clear and complete for it
to be carried out by a person skilled in the art. Where the
application concerns a microbiological process or the
product thereof and involves the use of a micro-organism
which cannot be sufficiently disclosed in the application in
such a way as to enable the invention to be carried out by
a person skilled in the art, and such material is not
available to the public, the application shall be
supplemented by a deposit of such material with an
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international depository institution.


35.2. Description. - The Regulations shall prescribe the
contents of the description and the order of presentation.
NOTES:
The description of the invention "is one of the essential
parts of certain kinds of patent documents, e.g., patent
applications or patents. It usually specifies the technical
field to which the invention relates, includes a brief
summary of the technical background of the invention and
describes the essential features of the invention with
reference to any accompanying draiwngs.
-Unity of InventionSec. 38
Section 38. Unity of Invention. - 38.1. The application shall
relate to one invention only or to a group of inventions
forming a single general inventive concept.
38.2. If several independent inventions which do not form a
single general inventive concept are claimed in one
application, the Director may require that the application be
restricted to a single invention. A later application filed for
an invention divided out shall be considered as having
been filed on the same day as the first application:
Provided, That the later application is filed within four (4)
months after the requirement to divide becomes final or
within such additional time, not exceeding four (4) months,
as may be granted: Provided further, That each divisional
application shall not go beyond the disclosure in the initial
application.
38.3. The fact that a patent has been granted on an
application that did not comply with the requirement of
unity of invention shall not be a ground to cancel the
patent.
NOTES:
Unity of Invention
"An International and a national application shall
relate to one inevention only or to a group of inventions so
linked as to form a single general inventive concept
("requirement of unity of invention").
Where a group of inventions is claimed in an
application, the requirement of unity of invention shall be
fulfilled only when there is a technical relationship among
those inventions involving one or more of the same or
corresponding special technical features.
The expression "special technical fetures" shall
mean those technical that define a contribution which each
of the claimed inventions, considered as a whole, makes
over the prior art."
5. Procedure for Grant of Patent
a. Filing Date RequirementsSec. 40
Section 40. Filing Date Requirements. - 40.1. The filing
date of a patent application shall be the date of receipt by
the Office of at least the following elements:
(a) An express or implicit indication that a
Philippine patent is sought;
(b) Information identifying the applicant; and
(c) Description of the invention and one (1) or more
claims in Filipino or English.
40.2. If any of these elements is not submitted within the
period set by the Regulations, the application shall be
considered withdrawn. (n)

b. Examination ProcessSec. 42-48


Section 42. Formality Examination. - 42.1. After the patent
application has been accorded a filing date and the
required fees have been paid on time in accordance with
the Regulations, the applicant shall comply with the formal
requirements specified by Section 32 and the Regulations
within the prescribed period, otherwise the application shall
be considered withdrawn.
42.2. The Regulations shall determine the procedure for
the re-examination and revival of an application as well as
the appeal to the Director of Patents from any final action
by the examiner.
Section 43. Classification and Search. - An application that
has complied with the formal requirements shall be
classified and a search conducted to determine the prior
art. (n)
Section 44. Publication of Patent Application. - 44.1. The
patent application shall be published in the IPO Gazette
together with a search document established by or on
behalf of the Office citing any documents that reflect prior
art, after the expiration of eighteen (18) months from
the filing date or priority date.
44.2. After publication of a patent application, any
interested party may inspect the application documents
filed with the Office.
44.3. The Director General subject to the approval of the
Secretary of Trade and Industry, may prohibit or restrict the
publication of an application, if in his opinion, to do so
would be prejudicial to the national security and interests of
the Republic of the Philippines. (n)
Section 45. Confidentiality Before Publication. - A patent
application, which has not yet been published, and all
related documents, shall not be made available for
inspection without the consent of the applicant. (n)
Section 46. Rights Conferred by a Patent Application After
Publication. - The applicant shall have all the rights of a
patentee under Section 76 against any person who, without
his authorization, exercised any of the rights conferred
under Section 71 of this Act in relation to the invention
claimed in the published patent application, as if a patent
had been granted for that invention: Provided, That the
said person had:
46.1. Actual knowledge that the invention that he was using
was the subject matter of a published application; or
46.2. Received written notice that the invention that he was
using was the subject matter of a published application
being identified in the said notice by its serial number:
Provided, That the action may not be filed until after the
grant of a patent on the published application and within
four (4) years from the commission of the acts complained
of. (n)
NOTES:
Right here not a patentee but a right of applicant.
An applicant shall have all the rights of a patentee, as if a
patent has been granted for the application: Provided,
-That a written notice is sent to a person using the
published invention,
-That the action may not be filed until after grant of

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a Patent
-that it should be within four 4 years from the
commission of the act.
Section 47. Observation by Third Parties. - Following the
publication of the patent application, any person may
present observations in writing concerning the patentability
of the invention. Such observations shall be communicated
to the applicant who may comment on them. The Office
shall acknowledge and put such observations and
comment in the file of the application to which it relates. (n)
Section 48. Request for Substantive Examination. 48.1. The application shall be deemed withdrawn unless
within six (6) months from the date of publication
under Section 41, a written request to determine whether
a patent application meets the requirements of Sections 21
to 27 and Sections 32 to 39 and the fees have been paid
on time.
48.2. Withdrawal of the request for examination shall be
irrevocable and shall not authorize the refund of any fee.
(n)
NOTES:
All examinations executed ex parte
Applications prosecuted ex parte
-Proceeding is a law contest between the Examiner,
representing the public and trying to give the applicant the
least possible monopoly, and the applicant, on the other
hand, trying to get as much monopoly as possible.
TERM of PROTECTION
20 years from the date of filing of the application
provided,
-That the Annual Fee is paid,
-Thet patent is not cancelled
(However the 20-year period is not absolute, it is
susceptible for cancellation)
Grounds of cancellation
1. Annual Fees (non-payment)
First annual fee--due on the expiration of four (4)
years from the date of first publication
Subsequent annual fees- due on the each
anniversary of such date.
Payment may be made within 3 months beofre the
due date
Application shall be deemed withdrawn, or a patent
be condsidered lapsed if annual fees are not paid on the
due date.

day when notice of his acceptance is published in the IPO


Gazette, the patent shall cease to have effect, but no
action for infringement shall lie and no right compensation
shall accrue for any use of the patented invention before
that day for the services of the government.
3. Grounds enumerated under SEC. 61
4. Sec. 67 (d) Seek cancellation of the patent, if one has
already been issued and Sec. 68
c. Publication and SearchSec. 44.1
Section 44. Publication of Patent Application. - 44.1. The
patent application shall be published in the IPO Gazette
together with a search document established by or on
behalf of the Office citing any documents that reflect prior
art, after the expiration of eighteen (18) months from the
filing date or priority date.
NOTES:
Application is published in the IPO Official Gazette
after 18 months from filing
Withdrawn application shall not be published
Publication shall contain the bibligraphic data,
drawing abstract and search report
Applicant is notified of the publication and remind
him to request for substantive examination within 6
months from publication
Published application are laoiid open for third party
observeation
Applicant may request for the early publication of the
application, Provided that,
Applicant submits a written waiver of the
.....?

PAYMENT OF THE FEE OF EARLIER PUBLICATION:


(p5500)
-Confidentiality before Publication

Sec. 45

Section 45. Confidentiality Before Publication. - A patent


application, which has not yet been published, and all
related documents, shall not be made available for
inspection without the consent of the applicant. (n)
d. Rights Conferred by Patent Application
After PublicationSec. 46

--There is a grace period.


2. It can also be a ground for cancellation. SEE Sec. 56
Section 56. Surrender of Patent. - 56.1. The owner of the
patent, with the consent of all persons having grants or
licenses or other right, title or interest in and to the patent
and the invention covered thereby, which have been
recorded in the Office, may surrender his patent or any
claim or claims forming part thereof to the Office for
cancellation.

Section 46. Rights Conferred by a Patent Application After


Publication. - The applicant shall have all the rights of a
patentee under Section 76 against any person who, without
his authorization, exercised any of the rights conferred
under Section 71 of this Act in relation to the invention
claimed in the published patent application, as if a patent
had been granted for that invention: Provided, That the
said person had:

56.2. A person may give notice to the Office of his


opposition to the surrender of a patent under this section,
and if he does so, the Bureau shall notify the proprietor of
the patent and determine the question.

46.1. Actual knowledge that the invention that he was using


was the subject matter of a published application; or

56.3. If the Office is satisfied that the patent may properly


be surrendered, he may accept the offer and, as from the

46.2. Received written notice that the invention that he was


using was the subject matter of a published application
being identified in the said notice by its serial number:
Provided, That the action may not be filed until after the

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grant of a patent on the published application and within


four (4) years from the commission of the acts complained
of. (n)
e. Grant of PatentSec. 50.3; 52.1
Section 50. Grant of Patent. xxx 50.3. A patent shall take
effect on the date of the publication of the grant of the
patent in the IPO Gazette.
Section 52. Publication Upon Grant of Patent. - 52.1.
The grant of the patent together with other related
information shall be published in the IPO Gazette within the
time prescribed by the Regulations.
CASE:
Manzano vs. CA(278 SCRA 688)
See the facts in the previous discussion.
HELD: The validity of the patent issued by the
Philippine Patent Office 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 Office.
The technical staff of the Philippine Patent Office
composed of experts in their field has by the
issuance of the patent in question accepted
private respondents model of gas burner as a
discovery. There is a presumption that the Office
has correctly determined the patentability of the
model and such action must not be interfered with
in the absence of competent evidence to the
contrary.

within which the annual fees were due. A notice that the
application is deemed withdrawn or the lapse of a patent
for non-payment of any annual fee shall be published in the
IPO Gazette and the lapse shall be recorded in the
Register of the Office.
6. Cancellation of Patents; Substitution of Patentee
a. Cancellation of PatentsSec. 61.1; 61.2
Section 61. Cancellation of Patents. - 61.1. Any interested
person may, upon payment of the required fee, petition to
cancel the patent or any claim thereof, or parts of the
claim, on any of the following grounds:
(a) That what is claimed as the invention is not new
or Patentable;
(b) That the patent does not disclose the invention
in a manner sufficiently clear and complete for it to be
carried out by any person skilled in the art; or
(c) That the patent is contrary to public order or
morality.
61.2. Where the grounds for cancellation relate to some of
the claims or parts of the claim, cancellation may be
effected to such extent only.
NOTES:
SEE ALSO: Section 62. Requirement of the Petition. - The
petition for cancellation shall be in writing, verified by the
petitioner or by any person in his behalf who knows the
facts, specify the grounds upon which it is based, include a
statement of the facts to be relied upon, and filed with the
Office. Copies of printed publications or of patents of other
countries, and other supporting documents mentioned in
the petition shall be attached thereto, together with the
translation thereof in English, if not in the English
language.

The rule is settled that the findings of fact of the


Director of Patents, especially when affirmed 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 findings and conclusions of
the Patent Office 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 justification 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 insufficient. Petition DISMISSED.

Where you file for petiton for cancellation: BUREAU OF


LEGAL AFFAIRS
b. Effect of CancellationSec. 66
Section 66. Effect of Cancellation of Patent or Claim. - The
rights conferred by the patent or any specified claim or
claims cancelled shall terminate. Notice of the cancellation
shall be published in the IPO Gazette. Unless restrained by
the Director General, the decision or order to cancel by
Director of Legal Affairs shall be immediately executory
even pending appeal.
7. Remedies of Person with Patent
a. Application by Persons not having Right to
PatentSec. 67

f. Annual FeesSec. 55.1; 55.2


Section 55. Annual Fees. - 55.1. To maintain the patent
application or patent, an annual fee shall be paid upon the
expiration of four (4) years from the date the application
was published pursuant to Section 44 hereof, and on each
subsequent anniversary of such date. Payment may be
made within three (3) months before the due date. The
obligation to pay the annual fees shall terminate should the
application be withdrawn, refused, or cancelled.
55.2. If the annual fee is not paid, the patent application
shall be deemed withdrawn or the patent considered as
lapsed from the day following the expiration of the period

Section 67. Patent Application by Persons Not Having the


Right to a Patent. . - 67.1. If a person referred to in Section
29 other than the applicant, is declared by final court order
or decision as having the right to the patent, such person
may, within three (3) months after the decision has become
final:
(a) Prosecute the application as his own
application in place of the applicant;
(b) File a new patent application in respect of the
same invention;
(c) Request that the application be refused; or
(d) Seek cancellation of the patent, if one has
already been issued.

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67.2. The provisions of Subsection 38.2 shall apply mutatis


mutandis to a new application filed under Subsection 67.
1(b).
SEE: SECTION 28
Section 28. Right to a Patent. - The right to a patent
belongs to the inventor, his heirs, or assigns. When two (2)
or more persons have jointly made an invention, the right
to a patent shall belong to them jointly.
The remedies enumerated in Sec 67 are not cumulative.
b. Remedies of True and Actual InventorSec. 68;
70
Section 68. Remedies of the True and Actual Inventor. - If
a person, who was deprived of the patent without his
consent or through fraud is declared by final court order or
decision to be the true and actual inventor, the court shall
order for his substitution as patentee, or at the option of the
true inventor, cancel the patent, and award actual and
other damages in his favor if warranted by the
circumstances.
NOTE: This
cancellation.

section

provides

another

ground

for

Section 70. Time to File Action in Court. - The actions


indicated in Sections 67 and 68 shall be filed within one (1)
year from the date of publication made in accordance with
Sections 44 and 51, respectively.
CASE:
Creser Precision Systems vs. CA (286 SCRA 13,
1998)
See the Facts from the previous discussion.
HELD: Section 42 of R.A. 165, otherwise known as the
Patent Law, explicitly provides: SECTION. 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 the
infringer damages sustained by reason of the
infringement and to secure an injunction for the
protection of his right. x x x

institute the petition for injunction and damages arising


from the alleged infringement by private respondent.
While petitioner claims to be the first 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, and
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 offering 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.
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 file an action
for declaratory judgment or injunctive suit which is not
recognized in this jurisdiction. Said person, however, is
not left without any remedy. He can, under Section 28
of the aforementioned law, file 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,
petitioners remedy is not to file an action for injunction
or infringement but to file a petition for cancellation of
private respondent patent. Petitioner however failed to
do so. As such, it can not now assail or impugn the
validity of the private respondents 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 first and true inventor of the invention.

8. Rights of
Patents

Patentees

and

Infringement

of

a. Rights Conferred by PatentSec. 71; 71.2 and


103.2

Under the aforequoted law, only the patentee or his


successors-in-interest may file 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 patentees 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 grantees,
of the exclusive right. 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. In
short, a person or entity who has not been granted
letters patent over an invention and has not acquired
any right 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.

Section 71. Rights Conferred by Patent. - 71.1. A patent


shall confer on its owner the following exclusive rights:
(a) Where the subject matter of a patent is a
product, to restrain, prohibit and prevent any unauthorized
person or entity from making, using, offering for sale,
selling or importing that product;

Petitioner admits it has no patent over its aerial fuze.


Therefore, it has no legal basis or cause of action to

Section 103. Transmission of Rights. xxx


103.2. Inventions and any right, title or interest in and to

(b) Where the subject matter of a patent is a


process, to restrain, prevent or prohibit any unauthorized
person or entity from using the process, and from
manufacturing, dealing in, using, selling or offering for
sale, or importing any product obtained directly or
indirectly from such process.
71.2. Patent owners shall also have the right to assign, or
transfer by succession the patent, and to conclude
licensing contracts for the same.

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patents and inventions covered thereby, may be assigned


or transmitted by inheritance or bequest or may be the
subject of a license contract.
-Where Patent covers Product
-Where Patent is Process
-Assign and Transfer
-Form of AssignmentSec. 104
Section 104. Assignment of Inventions. - An assignment
may be of the entire right, title or interest in and to the
patent and the invention covered thereby, or of an
undivided share of the entire patent and invention, in which
event the parties become joint owners thereof. An
assignment may be limited to a specified territory.

petitioner
herein.
Consequently,
private
respondent notified 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 filed before the RTC
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 decision was affirmed by
the appellate court. Thereafter, this petition was
filed.
ISSUE:
HELD:

-RecordingSec. 106.2
Section 106. Recording. xxx
106.2. Such instruments shall be void as against any
subsequent purchaser or mortgagee for valuable
consideration and without notice, unless, it is so recorded
in the Office, within three (3) months from the date of said
instrument, or prior to the subsequent purchase or
mortgage.

Smith Kline Beckham Corp. vs CA (G.R. No.


126627, Aug. 14, 2003)
FACTS:
ISSUE:
HELD:

-Rights of Joint OwnersSec. 107


Section 107. Rights of Joint Owners. - If two (2) or more
persons jointly own a patent and the invention covered
thereby, either by the issuance of the patent in their joint
favor or by reason of the assignment of an undivided share
in the patent and invention or by reason of the succession
in title to such share, each of the joint owners shall be
entitled to personally make, use, sell, or import the
invention for his own profit: Provided, however, That neither
of the joint owners shall be entitled to grant licenses or to
assign his right, title or interest or part thereof without the
consent of the other owner or owners, or without
proportionally dividing the proceeds with such other owner
or owners.
b. Doctrine of Equivalents
CASES:
Godines vs. CA (226 SCRA 338)
FACTS: The patent involved in this case is Letters
Patent No. UM-2236 issued by the Philippine
Patent Office to one Magdalena S. Villaruz on July
15, 1976. It covers a utility model for a hand
tractor or power tiller.
The above mentioned patent was acquired by SVAgro 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, 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, SVAgro Industries suffered 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

c. Limitation of
amended by RA 9502

Patent RightsSec. 72 as

d. Prior UserSec. 72
RA No. 9502, SEC. 7. Section 72 of Republic Act No.
8293, otherwise known as the Intellectual Property Code of
the Philippines, is hereby amended to read as follows:
"SEC. 72. Limitations of Patent Rights. - The owner of a
patent has no right to prevent third parties from performing,
without his authorization, the acts referred to in Section 71
hereof in the following circumstances:
"72.1. Using a patented product which has been put on the
market in the Philippines by the owner of the product, or
with his express consent, insofar as such use is performed
after that product has been so put on the said market:
Provided, That, with regard to drugs and medicines, the
limitation on patent rights shall apply after a drug or
medicine has been introduced in the Philippines or
anywhere else in the world by the patent owner, or by any
party authorized to use the invention: Provided, further,
That the right to import the drugs and medicines
contemplated in this section shall be available to any
government agency or any private third party;
"72.2. Where the act is done privately and on a noncommercial scale or for a non-commercial purpose:
Provided, That it does not significantly prejudice the
economic interests of the owner of the patent;
"72.3. Where the act consists of making or using
exclusively for experimental use of the invention for
scientific purposes or educational purposes and such other
activities directly related to such scientific or educational
experimental use;

"72.4. In the case of drugs and medicines, where the act


includes testing, using, making or selling the invention
including any data related thereto, solely for purposes
reasonably related to the development and submission of
information and issuance of approvals by government
regulatory agencies required under any law of the
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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

Philippines or of another country that regulates the


manufacture, construction, use or sale of any product:
Provided, That, in order to protect the data submitted by
the original patent holder from unfair commercial use
provided in Article 39.3 of the Agreement on Trade-Related
Aspects of Intellectual Property Rights (TRIPS Agreement),
the Intellectual Property Office, in consultation with the
appropriate government agencies, shall issue the
appropriate rules and regulations necessary therein not
later than one hundred twenty (120) days after the
enactment of this law;
"72.5. Where the act consists of the preparation for
individual cases, in a pharmacy or by a medical
professional, of a medicine in accordance with a medical
prescription or acts concerning the medicine so prepared;
and
"72.6. Where the invention is used in any ship, vessels,
aircraft or land vehicle of any other country entering the
territory of the Philippines temporarili or accidentally:
Provided, That such invention is used exclusively for the
needs of the ship, vessel, aircraft or land vehicle and not
used for the manufacturing of anything to be sold within the
Philippines.
NOTES:
Another Limitations: SEE Sec. 73. Prior Use
Section 73. Prior User. - 73.1. Notwithstanding Section 72
hereof, any prior user, who, in good faith was using the
invention or has undertaken serious preparations to use
the invention in his enterprise or business, before the filing
date or priority date of the application on which a patent is
granted, shall have the right to continue the use thereof as
envisaged in such preparations within the territory where
the patent produces its effect.
73.2. The right of the prior user may only be transferred or
assigned together with his enterprise or business, or with
that part of his enterprise or business in which the use or
preparations for use have been made.
Another Limitations: Use of invention by the Government
( See: Section 74)
e. Use of Invention of GovernmentSec. 74 as
amended-RA No. 9502, Sec. 8. Section 74 of Republic Act No. 8293,
otherwise known as the Intellectual Property Code of the
Philippines, is hereby amended to read as follows:
"Sec. 74. use of Invention by Government.--74.1 A
Government agency or third person authorized by the
Government may exploit the invention even without
agreement of the patent owner where:
"(a) The public interest, in particular, national
security, nutrition, health or the development of other
sectors, as determined by the appropriate agency of the
government, so requires; or
"(b) A judicial or administrative body has
determined that the manner of explotation, by the owner of
the patent or his licensee, is anti-competitive; or

urgency requiring the use of the invention; or


"(d) In the case of drugs and medicines, there is
public non-commenrcial use of the patent by the patentee,
without satisfactory reason; or
"(e) In the case of drugs and medicines, the
demand for the patented article in the Philippines is not
being met to an adequate extent and on reasonable terms,
as determined by the Secretary of the Department of
Health."
"74.2. Unless otherwise provided herein, the use by the
Government, or third person authorized by the
Government shall be subject, where applicable, to the
following provisions:
"(a) In situations of national emergency or other
circumstances of extreme urgency as provided under
Section 74.1 (c), the right holder shall be notified as soon
as reasonably practicable;
"(b) In the case of public non-commercial use of
the patent by the patentee, without satisfactory reason, as
provided under Section 74.1 (d) , the right holder shall be
informed promptly: Provided, That the Government or third
person authorized by the Government, without making a
patent search, knows or has demonstrable ground to know
that a valid patent is or will be used by or for the
Government;
"(c) If the demand for the patented artcle in the
philippines is not being met to an adequate extent and on
reasonable terms as provided under Section 74.1 (e), the
right holder shall be informed promptly;
"(d) The scope and duration of such use shall be
limited to the purpose for which it was authorized;
"(e) Such use shall be non-exclusive;
(f) The right holder shall be paid adequate
remuneration in the circumstances of each case, taking
into account the economic value of the aurhorization; and
(g) The existence of a national emergency or other
circumstances of extreme urgency, referred to under
Section 74.1 (c), shall be subject to the determination of
the President of the Philippines for the purpose of
determining the need for such use or other exploitation,
which shall be immediately executory.
74.3. All cases arising from the implementation of this
provision shll be cognizable by courts with appropriate
jurisdiction provided by law.
No court, except the Supreme Court of the
Philippines, shall issue any temporary restraining order or
preliminary injunction or such other proviional remedies
that will prevent its immediate execution.
74.4. The Intellectual Property Office (IPO), in consultation
with the appropriate government agencies, shall issue the
appropriate implementing rules and regulations for the use
or exploitation of patented inventions as contemplated in
this section within one hunderdd twenty (120) days after
the effectivity of this law.

NOTES:
The Section 74; It is an act of enforcing of its police power
by the Government.
INTELLECTUAL PROPERTY OF RIZA MAE GUERRERO OMEGA, LLB-2 54

"(c) In the case of drugs and medicine, there is a


national emergency or other cicumstance of extreme

INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

f. Civil Action for InfringementSec. 76 as


amended
RA No. 9502,SEC. 9. Section 76.1 of Republic Act No.
8293, otherwise known as the Intellectual Property Code of
the Philippines, is hereby amended to read as follows:
"SEC. 76. Civil Action for Infringement. - 76.1. The making,
using, offering for sale, selling, or importing a patented
product or a product obtained directly or indirectly from a
patented process, or the use of a patented process without
the authorization of the patentee constitutes patent
infringement: Provided, That, this shall not apply to
instances covered by Sections 72.1 and 72.4 (Limitations
of Patent Rights); Section 74 (Use of Invention by
Government); Section 93.6 (Compulsory Licensing); and
Section 93-A (Procedures on Issuance of a Special
Compulsory License under the TRIPS Agreement) of this
Code.
"76.2. x x x;
"76.3. x x x;
"76.4. x x x;
"76.5. x x x; and
"76.6. x x x."
RA No. 8293, SEC. 76. Civil Action for Infringement. xxx
76.2. 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 a court of
competent jurisdiction, to recover from the infringer such
damages sustained thereby, plus attorney's fees and other
expenses of litigation, and to secure an injunction for the
protection of his rights.
76.3. If the damages are inadequate or cannot be readily
ascertained with reasonable certainty, the court may award
by way of damages a sum equivalent to reasonable royalty.
76.4. The court may, according to the circumstances of the
case, award damages in a sum above the amount found as
actual damages sustained: Provided, That the award does
not exceed three (3) times the amount of such actual
damages.
76.5. The court may, in its discretion, order that the
infringing goods, materials and implements predominantly
used in the infringement be disposed of outside the
channels
of
commerce
or
destroyed,
without
compensation.
76.6. Anyone who actively induces the infringement of a
patent or provides the infringer with a component of a
patented product or of a product produced because of a
patented process knowing it to be especially adopted for
infringing the patented invention and not suitable for
substantial non-infringing use shall be liable as a
contributory infringer and shall be jointly and severally
liable with the infringer.
g. Limitation of Action for DamagesSec. 79
Section 79. Limitation of Action for Damages. - No
damages can be recovered for acts of infringement
committed more than four (4) years before the
institution of the action for infringement.
h. Damages; requirement of NoticeSec. 80
Section 80. Damages, Requirement of Notice. - Damages
cannot be recovered for acts of infringement committed

before the infringer had known, or had reasonable grounds


to know of the patent. It is presumed that the infringer had
known of the patent if on the patented product, or on the
container or package in which the article is supplied to the
public, or on the advertising material relating to the
patented product or process, are placed the words
"Philippine Patent" with the number of the patent.
CASES:
ROBERTO L. DEL ROSARIO vs. COURT OF
APPEALS AND JANITO CORPORATION
G.R. No. 115106 March 15, 1996
FACTS: 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 filed a
complaint for patent infringement against private
respondent Janito Corporation. 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 effectivity of both Letters
Patents was for five (5) years and was extended for
another five (5) years starting 2 June 1988 and 14
November 1991, respectively. He described his singalong system as a handy multi-purpose compact
machine which incorporates an amplifier speaker, one
or two tape mechanisms, optional tuner or radio and
microphone mixer with features to enhance one's 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.
ISSUE: Whether respondent Court of Appeals erred in
finding 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.
HELD: 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.
Admittedly, petitioner is a holder of Letters Patent No.
UM-5629 dated 2 June 1985 issued for a term of five
(5) years from the grant of a Utility Model herein
described
The construction of an audio equipment comprising a
substantially cubical casing having a window at its rear
and upper corner fitted with a slightly inclined control
panel, said cubical (casing) having a vertical partition
wall therein defining a rear compartment and a front
compartment, and said front compartment serving as a
speaker baffle; a transistorized amplifier 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 amplifier circuit capable of being
operated from outside, through various controls
mounted on said control panel of such casing; a loud
speaker fitted inside said front compartment of said

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casing and connected to the output of the main audio


amplifier section of said transistorized amplifier 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 amplifier
circuit.
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
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 defining the rear compartment from the
front compartment, with the front compartment
consisting of a loud speaker baffle, both containing a
transistorized amplifier circuit capable of being operated
from outside through various controls mounted on the
control panel, and that both had loud speakers fitted
inside the front compartment of the casing and
connected to the output of the main audio amplifier
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 amplifier circuit.
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 first patented
model. Notwithstanding the differences 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 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
effect, 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.
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.

Godines vs CA (226 SCRA 338)

HELD:

i. Infringement Action by Foreign NationalSec. 77


Section 77. Infringement Action by a Foreign National. Any foreign national or juridical entity who meets the
requirements of Section 3 and not engaged in business in
the Philippines, to which a patent has been granted or
assigned under this Act, may bring an action for
infringement of patent, whether or not it is licensed to do
business in the Philippines under existing law.
j. Defenses in Action for InfringementSec. 81
Section 81. Defenses in Action for Infringement. - In an
action for infringement, the defendant, in addition to other
defenses available to him, may show the invalidity of the
patent, or any claim thereof, on any of the grounds on
which a petition of cancellation can be brought under
Section 61 hereof.

Section 82. Patent Found Invalid May be Cancelled. - In


an action for infringement, if the court shall find the patent
or any claim to be invalid, it shall cancel the same, and the
Director of Legal Affairs upon receipt of the final judgment
of cancellation by the court, shall record that fact in the
register of the Office and shall publish a notice to that effect
in the IPO Gazette.

k. Criminal Action for Repetition of Infringement


Sec. 84
Section 84. Criminal Action for Repetition of Infringement.
- If infringement is repeated by the infringer or by anyone in
connivance with him after finality of the judgment of the
court against the infringer, the offenders shall, without
prejudice to the institution of a civil action for damages, be
criminally liable therefor and, upon conviction, shall suffer
imprisonment for the period of not less than six (6) months
but not more than three (3) years and/or a fine of not less
than One hundred thousand pesos (P100,000) but not
more than Three hundred thousand pesos (P300,000), at
the discretion of the court. The criminal action herein
provided shall prescribe in three (3) years from date of the
commission of the crime.
CASE:
Kenneth Roy Savage vs, Taypin (331 SCRA
697, 2000)

FACTS:

FACTS:

ISSUE:

ISSUE:

HELD:

HELD:

Tanada vs. Angara (272 SCRA 18, 1997)


FACTS;
ISSUE:

Patent Found Invalid for InfringementSec. 82

9. Voluntary Licensing
a. Voluntary License ContractSec. 85
Section 85. Voluntary License Contract. - To encourage
the transfer and dissemination of technology, prevent or
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control practices and conditions that may in particular


cases constitute an abuse of intellectual property rights
having an adverse effect on competition and trade, all
technology transfer arrangements shall comply with the
provisions of this Chapter. (n)
-Technology Transfer ArrangementsSec.

4.2

Section 4. Definitions. xxx 4.2. The term "technology


transfer arrangements" refers to contracts or agreements
involving the transfer of systematic knowledge for the
manufacture of a product, the application of a process, or
rendering of a service including management contracts;
and the transfer, assignment or licensing of all forms of
intellectual property rights, including licensing of computer
software except computer software developed for mass
market.
b. Prohibited ClausesSec. 87
Section 87. Prohibited Clauses. - Except in cases under
Section 91, the following provisions shall be deemed prima
facie to have an adverse effect on competition and trade:
87.1. Those which impose upon the licensee the obligation
to acquire from a specific source capital goods,
intermediate products, raw materials, and other
technologies, or of permanently employing personnel
indicated by the licensor;
87.2. Those pursuant to which the licensor reserves the
right to fix the sale or resale prices of the products
manufactured on the basis of the license;
87.3. Those that contain restrictions regarding the volume
and structure of production;
87.4. Those that prohibit the use of competitive
technologies in a non-exclusive technology transfer
agreement;
87.5. Those that establish a full or partial purchase option
in favor of the licensor;
87.6. Those that obligate the licensee to transfer for free to
the licensor the inventions or improvements that may be
obtained through the use of the licensed technology;
87.7. Those that require payment of royalties to the owners
of patents for patents which are not used;
87.8. Those that prohibit the licensee to export the licensed
product unless justified for the protection of the legitimate
interest of the licensor such as exports to countries where
exclusive licenses to manufacture and/or distribute the
licensed product(s) have already been granted;
87.9. Those which restrict the use of the technology
supplied after the expiration of the technology transfer
arrangement, except in cases of early termination of the
technology transfer arrangement due to reason(s)
attributable to the licensee;
87.10. Those which require payments for patents and other
industrial property rights after their expiration, termination
arrangement;

87.11. Those which require that the technology recipient


shall not contest the validity of any of the patents of the
technology supplier;
87.12. Those which restrict the research and development
activities of the licensee designed to absorb and adapt the
transferred technology to local conditions or to initiate
research and development programs in connection with
new products, processes or equipment;
87.13. Those which prevent the licensee from adapting the
imported technology to local conditions, or introducing
innovation to it, as long as it does not impair the quality
standards prescribed by the licensor;
87.14. Those which exempt the licensor for liability for nonfulfilment of his responsibilities under the technology
transfer arrangement and/or liability arising from third party
suits brought about by the use of the licensed product or
the licensed technology; and
87.15. Other clauses with equivalent effects.

c. Mandatory ProvisionsSec. 88
Section 88. Mandatory Provisions. - The following
provisions shall be included in voluntary license contracts:
88.1. That the laws of the Philippines shall govern the
interpretation of the same and in the event of litigation, the
venue shall be the proper court in the place where the
licensee has its principal office;
88.2. Continued access to improvements in techniques and
processes related to the technology shall be made
available during the period of the technology transfer
arrangement;
88.3. In the event the technology transfer arrangement
shall provide for arbitration, the Procedure of Arbitration of
the Arbitration Law of the Philippines or the Arbitration
Rules of the United Nations Commission on International
Trade Law (UNCITRAL) or the Rules of Conciliation and
Arbitration of the International Chamber of Commerce
(ICC) shall apply and the venue of arbitration shall be the
Philippines or any neutral country; and
88.4. The Philippine taxes on all payments relating to the
technology transfer arrangement shall be borne by the
licensor. (n)
d. Rights of LicensorSec. 89
Section 89. Rights of Licensor. - In the absence of any
provision to the contrary in the technology transfer
arrangement, the grant of a license shall not prevent the
licensor from granting further licenses to third person nor
from exploiting the subject matter of the technology
transfer arrangement himself.
e. Rights of LicenseeSec. 90
Section 90. Rights of Licensee. - The licensee shall be
entitled to exploit the subject matter of the technology
transfer arrangement during the whole term of the
technology transfer arrangement.

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f. Exceptional CasesSec. 91

reasonable terms, as determined by the Secretary of the


Department of Health."

Section 91. Exceptional Cases. - In exceptional or


meritorious cases where substantial benefits will accrue to
the economy, such as high technology content, increase in
foreign exchange earnings, employment generation,
regional dispersal of industries and/or substitution with or
use of local raw materials, or in the case of Board of
Investments, registered companies with pioneer status,
exemption from any of the above requirements may be
allowed by the Documentation, Information and Technology
Transfer Bureau after evaluation thereof on a case by case
basis. (n)
g. Non-RegistrationSec. 92
Section 92. Non-Registration with the Documentation,
Information and Technology Transfer Bureau. - Technology
transfer arrangements that conform with the provisions of
Sections 86 and 87 need not be registered with the
Documentation, Information and Technology Transfer
Bureau. Non-conformance with any of the provisions of
Sections 87 and 88, however, shall automatically render
the technology transfer arrangement unenforceable, unless
said technology transfer arrangement is approved and
registered with the Documentation, Information and
Technology Transfer Bureau under the provisions of
Section 91 on exceptional cases. (n)
10. Compulsory Licensing
a. Grounds for Compulsory LicensingSec. 93 as
amended by RA 9502
RA No. 9502, SEC. 10. Section 93 of Republic Act No.
8293, otherwise known as the Intellectual Property Code of
the Philippines, is hereby amended to read as follows:
"SEC. 93. Grounds for Compulsory Licensing. - The
Director General of the Intellectual Property Office may
grant a license to exploit a patented invention, even
without the agreement of the patent owner, in favor of any
person who has shown his capability to exploit the
invention, under any of the following circumstances:
"93.1. National emergency or other circumstances of
extreme urgency;
"93.2. Where the public interest, in particular, national
security, nutrition, health or the development of other vital
sectors of the national economy as determined by the
appropriate agency of the Government, so requires; or
"93.3. Where a judicial or administrative body has
determined that the manner of exploitation by the owner of
the patent or his licensee is anti-competitive; or
"93.4. In case of public non-commercial use of the patent
by the patentee, without satisfactory reason;
"93.5. If the patented invention is not being worked in the
Philippines on a commercial scale, although capable of
being worked, without satisfactory reason: Provided, That
the importation of the patented article shall constitute
working or using the patent; (Secs. 34, 34-A, 34-B, R.A.
No. 165a) and
"93.6. Where the demand for patented drugs and
medicines is not being met to an adequate extent and on

CASE:
Smith Kline vs. CA (G.R. No. 121267, Oct. 23,
2001)
FACTS:
ISSUE:
HELD:

b. Period for Filing a Petition for Compulsory License


Sec. 94 as amended
RA No. 9502, SEC. 12. Section 94 of Republic Act No.
8293, otherwise known as the Intellectual Property Code of
the Philippines, is hereby amended to read as follows:
"SEC. 94. Period for Filing a Petition for a Compulsory
License. - 94.1. A compulsory license may not be applied
for on the ground stated in Subsection 93.5 before the
expiration of a period of four (4) years from the date of
filing of the application or three (3) years from the date of
the patent whichever period expires last.
"94.2. A compulsory license which is applied for on any of
the grounds stated in Subsections 93.2, 93.3, 93.4, and
93.6 and Section 97 may be applied for at any time after
the grant of the patent. (Sec. 34(1), R. A. No. 165)"
c. Requirement to Obtain License on
Commercial TermsSec. 95 as amended

Reasonable

RA No 9502, SEC. 13. Section 95 of Republic Act No.


8293, otherwise known as the Intellectual Property Code of
the Philippines, is hereby amended to read as follows:
"SEC. 95. Requirement to Obtain a License on
Reasonable Commercial Terms. - 95.1. The license will
only be granted after the petitioner has made efforts to
obtain authorization from the patent owner on reasonable
commercial terms and conditions but such efforts have not
been successful within a reasonable period of time.
"95.2. The requirement under Subsection 95.1 shall not
apply in any of the following cases:
"(a) Where the petition for compulsory license
seeks to remedy a practice determined after judicial or
administrative process to be anti-competitive;
"(b) In situations of national emergency or other
circumstances of extreme urgency;
"(c) In cases of public non-commercial use; and
"(d) In cases where the demand for the patented
drugs and medicines in the Philippines is not being met to
an adequate extent and on reasonable terms, as
determined by the Secretary of the Department of Health.
"95.3. In situations of national emergency or other
circumstances of extreme urgency, the right holder shall be
notified as soon as reasonably practicable.
"95.4. In the case of public non-commercial use, where the
government or contractor, without making a patent search,
knows or has demonstrable grounds to know that a valid
patent is or will be used by or for the government, the right
holder shall be informed promptly. (n)

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"95.5. Where the demand for the patented drugs and


medicines in the Philippines is not being met to an
adequate extent and on reasonable terms, as determined
by the Secretary of the Department of Health, the right
holder shall be informed promptly."

Section 100. Terms and Conditions of Compulsory


License. - The basic terms and conditions including the
rate of royalties of a compulsory license shall be fixed by
the Director of Legal Affairs subject to the following
conditions:

CASES:
Parke Davis & Co. vs. Doctors' Pharmaceutical
(14 SCRA 1053, 1965)

100.1. The scope and duration of such license shall be


limited to the purpose for which it was authorized;
100.2. The license shall be non-exclusive;

FACTS:
100.3. The license shall be non-assignable, except with
that part of the enterprise or business with which the
invention is being exploited;

ISSUE:
HELD:

100.4. Use of the subject matter of the license shall be


devoted predominantly for the supply of the Philippine
market: Provided, That this limitation shall not apply where
the grant of the license is based on the ground that the
patentee's manner of exploiting the patent is determined by
judicial or administrative process, to be anti-competitive.

Smith Kline vs CA (274 SCRA 224, 1997)


FACTS:
ISSUE:
HELD:

d. Compulsory Licensing on Semi-Conductor Technology


Sec. 96

100.5. The license may be terminated upon proper


showing that circumstances which led to its grant have
ceased to exist and are unlikely to recur: Provided, That
adequate protection shall be afforded to the legitimate
interest of the licensee; and

Section 96. Compulsory Licensing of Patents Involving


Semi-Conductor Technology. - In the case of compulsory
licensing of patents involving semi-conductor technology,
the license may only be granted in case of public noncommercial use or to remedy a practice determined after
judicial or administrative process to be anti-competitive. (n)

100.6. The patentee shall be paid adequate remuneration


taking into account the economic value of the grant or
authorization, except that in cases where the license was
granted to remedy a practice which was determined after
judicial or administrative process, to be anti-competitive,
the need to correct the anti-competitive practice may be
taken into account in fixing the amount of remuneration.

e. Compulsory License Based on Interdependence of


PatentsSec. 97

g. Amendment, Cancellation, Surrender of Compulsory


LicenseSec. 101

Section
97.
Compulsory
License
Based
on
Interdependence of Patents. - If the invention protected by
a patent, hereafter referred to as the "second patent,"
within the country cannot be worked without infringing
another patent, hereafter referred to as the "first patent,"
granted on a prior application or benefiting from an earlier
priority, a compulsory license may be granted to the owner
of the second patent to the extent necessary for the
working of his invention, subject to the following conditions:

Section 101. Amendment, Cancellation, Surrender of


Compulsory License. - 101.1. Upon the request of the
patentee or the licensee, the Director of Legal Affairs may
amend the decision granting the compulsory license, upon
proper showing of new facts or circumstances justifying
such amendment.

97.1. The invention claimed in the second patent involves


an important technical advance of considerable economic
significance in relation to the first patent;

(a) If the ground for the grant of the compulsory license no


longer exists and is unlikely to recur;

97.2. The owner of the first patent shall be entitled to a


cross-license on reasonable terms to use the invention
claimed in the second patent;
97.3. The use authorized in respect of the first patent shall
be non-assignable except with the assignment of the
second patent; and
97.4. The terms and conditions of Sections 95, 96 and 98
to 100 of this Act.
f. Terms and Conditions of Compulsory LicenseSec. 100

101.2. Upon the request of the patentee, the said Director


may cancel the compulsory license:

(b) If the licensee has neither begun to supply the domestic


market nor made serious preparation therefor;
(c) If the licensee has not complied with the prescribed
terms of the license;
101.3. The licensee may surrender the license by a written
declaration submitted to the Office.
101.4. The said Director shall cause the amendment,
surrender, or cancellation in the Register, notify the
patentee, and/or the licensee, and cause notice thereof to
be published in the IPO Gazette.

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h. Licensee's Exemption from LiabilitySec. 102

c. Prohibition Against Filing of Parallel ApplicationsSec.


111

Section 102. Licensee's Exemption from Liability. - Any


person who works a patented product, substance and/or
process under a license granted under this Chapter, shall
be free from any liability for infringement: Provided
however, That in the case of voluntary licensing, no
collusion with the licensor is proven. This is without
prejudice to the right of the rightful owner of the patent to
recover from the licensor whatever he may have received
as royalties under the license.

Section 111. Prohibition against Filing of Parallel


Applications. - An applicant may not file two (2)
applications for the same subject, one for utility model
registration and the other for the grant of a patent whether
simultaneously or consecutively.
12. Industrial Designs
a. Industrial DesignsSec. 112.1

11. Registration of Utility Models


a. Applicability of Provisions Relating to PatentsSec. 108
Section 108. Applicability of Provisions Relating to
Patents. - 108.1. Subject to Section 109, the provisions
governing patents shall apply, mutatis mutandis, to the
registration of utility models.
108.2. Where the right to a patent conflicts with the right to
a utility model registration in the case referred to in Section
29, the said provision shall apply as if the word "patent"
were replaced by the words "patent or utility model
registration".
-Sec. 109.1
Section 109. Special Provisions Relating to Utility Models.
- 109.1. (a) An invention qualifies for registration as a utility
model if it is new and industrially applicable.
(b) Section 21, "Patentable Inventions", shall apply except
the reference to inventive step as a condition of protection.
-Patentable Inventions
-Sec. 109.3
Sec. 109.3. A utility model registration shall expire, without
any possibility of renewal, at the end of the seventh year
after the date of the filing of the application.
CASE:
Del Rosario vs. CA (G.R. No. 115106, Mar. 15,
1996, 255 SCRA 152)
FATCS:

RA No. 9150, SECTION. 1. Sections 112, 113, 114, 116,


117, 118, 119 and 120 under Chapter XIII of R.A. No. 8293
are hereby amended to read as follows:
CHAPTER XIII
INDUSTRIAL DESIGN AND LAYOUT-DESIGNS
(TOPOGRAPHIES) OF INTEGRATED CIRCUITS
SEC. 12. Definition of Terms:
1. An Industrial Design is any composition of lines or
colors or any three-dimensional form, whether or not
associated with lines or colors: Provided, That such
composition or form gives a special appearance to and can
serve as pattern for an industrial product or handicraft;
b. Integrated CircuitSec. 112.2 (amended by RA
9150, Sec. 1)
2. Integrated Circuit means a product, in its final form, or
an intermediate form, in which the elements, at least one of
which is an active element, and some or all of the
interconnections are integrally formed in and/or on a piece
of material, and which is intended to perform an electronic
function; and
c. Lay-out DesignsSec. 112.3 (amended by RA
9150, Sec. 1)
3. Layout-Design is synonymous with Topography and
means the three-dimensional disposition, however
expressed, of the elements, at least one of which is an
active element, and of some or all of the interconnections
of an integrated circuit, or such a three-dimensional
disposition prepared for an integrated circuit intended for
manufacture.
d. Substantial Conditions for Protection
Sec.113.1; 113.3; 113.4; 113.2 (amended by RA
9150, Sec. 1)

ISSUE:
HELD:
b. Conversion of Patent Application for Utility Model
RegistrationSec. 110.1; 110.2
Section 110. Conversion of Patent Applications or
Applications for Utility Model Registration. - 110.1. At any
time before the grant or refusal of a patent, an applicant for
a patent may, upon payment of the prescribed fee, convert
his application into an application for registration of a utility
model, which shall be accorded the filing date of the initial
application. An application may be converted only once.
110.2. At any time before the grant or refusal of a utility
model registration, an applicant for a utility model
registration may, upon payment of the prescribed fee,
convert his application into a patent application, which shall
be accorded the filing date of the initial application.

SEC. 113. Substantive Conditions for Protection. 113.1.


Only industrial designs that are new or ornamental shall
benefit from protection under this Act.
113.2. Industrial designs dictated essentially by technical
or functional considerations to obtain a technical result or
those that are contrary to public order, health or morals
shall not be protected.
113.3. Only layout-designs of integrated circuits that are
original shall benefit from protection under this Act. A
layout-design shall be considered original if it is the result
of its creators own intellectual effort and is not
commonplace among creators of layout-designs and
manufacturers of integrated circuits at the time of its
creation.
113.4. A layout-design consisting of a combination of
elements and interconnections that are commonplace shall

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be protected only if the combination, taken as a whole, is


original.
e. Term
Sec. 118

of

Industrial

Design

Registration

SEC. 118. The Term of Industrial Design or Layout-Design


Registration. 118.1. The registration of an industrial
design shall be for a period of five (5) years from the filing
date of the application.
118.2. The registration of an industrial design may be
renewed for not more than two (2) consecutive periods of
five (5) years each, by paying the renewal fee.
118.3. The renewal fee shall be paid within
months preceding the expiration of the
registration. However, a grace period of six
shall be granted for payment of the fees
expiration, upon payment of a surcharge.

twelve (12)
period of
(6) months
after such

118.4. The Regulations shall fix the amount of renewal


fee, the surcharge and other requirements regarding the
recording of renewals of registration.
118.5. Registration of a layout-design shall be valid for a
period of ten (10) years, without renewal, and such validity
to be counted from the date of commencement of the
protection accorded to the layout-design. The protection of
a layout-design under this Act shall commence:
a) on the date of the first commercial exploitation,
anywhere in the world, of the layout-design by or with the
consent of the right holder: Provided, That an application
for registration is filed with the Intellectual Property Office
within two (2) years from such date of first commercial
exploitation; or
b) on the filing date accorded to the application for the
registration of the layout-design if the layout-design has not
been previously exploited commercially anywhere in the
world.
f. Rights Conferred to Owner of Layout Design
RegistrationSec. 119.4; Sec. 119.5 (amended by RA
9150, Sec. 1)
119.4. Rights Conferred to the Owner of a Layout-Design
Registration. The owner of a layout-design registration
shall enjoy the following rights:
(1) to reproduce, whether by incorporation in an integrated
circuit or otherwise, the registered layout-design in its
entirety or any part thereof, except the act of reproducing
any part that does not comply with the requirement of
originality; and
(2) to sell or otherwise distribute for commercial purposes
the registered layout-design, an article or an integrated
circuit in which the registered layout-design is
incorporated.
119.5. Limitations of Layout Rights. The owner of a
layout design has no right to prevent third parties from
reproducing, selling or otherwise distributing for
commercial purposes the registered layout-design in the
following circumstances:
(1) Reproduction of the registered layout-design for
private purposes or for the sole purpose of evaluation,
analysis, research or teaching;
(2) Where the act is performed in respect of a layoutdesign created on the basis of such analysis or evaluation

and which is itself original in the meaning as provided


herein;
(3) Where the act is performed in respect of a registered
layout-design, or in respect of an integrated circuit in which
such a layout-design is incorporated, that has been put on
the market by or with the consent of the right holder;
(4) In respect of an integrated circuit where the person
performing or ordering such an act did not know and had
no reasonable ground to know when acquiring the
integrated circuit or the article incorporating such an
integrated circuit, that it incorporated an unlawfully
reproduced layout-design: Provided, however, That after
the time that such person has received sufficient notice
that the layout-design was unlawfully reproduced, that
person may perform any of the said acts only with respect
to the stock on hand or ordered before such time and shall
be liable to pay to the right holder a sum equivalent to at
least 5% of net sales or such other reasonable royalty as
would be payable under a freely negotiated license in
respect of such layout-design; or
(5) Where the act is performed in respect of an identical
layout design which is original and has been created
independently by a third party.

V. THE LAW ON TRADEMARKS, SERVICE MARKS AND


TRADE NAMES
NOTES:
Registration is important!
IPO where you registered.
-Any visible sign used to identify goods and services or any
item or article for sale.
-Goods: trademark
-Services: Service marks
1. Purpose of the Trademark Law
Philip Morris Inc. vs Fortune Tobacco Corp. (G.R.
No. 158589, June 27, 2006)
FACTS: Petitioner Philip Morris, Inc., a corporation
organized under the laws of the State of Virginia, USA,
is, per Certificate of Registration No. 18723 by the
Philippine Patents Office (PPO), the registered owner
of the trademark MARK VII for cigarettes. Similarly,
petitioner Benson & Hedges (Canada), Inc., a
subsidiary of Philip Morris, Inc., is the registered owner
of the trademark MARK TEN for cigarettes. Another
subsidiary of Philip Morris, Inc., the Swiss company
Fabriques de Tabac Reunies, S.A., is the assignee of
the trademark LARK, which was originally registered
in 1964 by Ligget and Myers Tobacco Company.
Respondent Fortune Tobacco Corporation, a company
organized in the Philippines, manufactures and sells
cigarettes using the trademark MARK.
The legal dispute between the parties started when the
herein petitioners, on the claim that an infringement of
their respective trademarks had been committed, filed a
Complaint for Infringement of Trademark and Damages
against respondent Fortune Tobacco Corporation.
[Petitioners] likewise manifested [being registered
owners of the trademark MARK VII and MARK TEN
for cigarettes as evidenced by the corresponding
certificates of registration and an applicant for the
registration of the trademark LARK MILDS]. xxx.
[Petitioners] claimed that they have registered the
aforementioned trademarks in their respective

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countries of origin and that, by virtue of the long and


extensive usage of the same, these trademarks have
already gained international fame and acceptance.
Imputing bad faith on the part of the [respondent],
petitioners claimed that the [respondent], without any
previous consent from any of the [petitioners],
manufactured and sold cigarettes bearing the identical
and/or confusingly similar trademark MARK xxx
Accordingly, they argued that [respondents] use of the
trademark MARK in its cigarette products have
caused and is likely to cause confusion or mistake, or
would deceive purchasers and the public in general into
buying these products under the impression and
mistaken belief that they are buying [petitioners]
products.
Invoking the provisions of the Paris Convention for the
Protection of Industrial and Intellectual Property (Paris
Convention, for brevity), to which the Philippines is a
signatory [petitioners] pointed out that upon the request
of an interested party, a country of the Union may
prohibit the use of a trademark which constitutes a
reproduction, imitation, or translation of a mark already
belonging to a person entitled to the benefits of the said
Convention. They likewise argued that, in accordance
with Section 21-A in relation to Section 23 of Republic
Act 166, as amended, they are entitled to relief in the
form of damages xxx [and] the issuance of a writ of
preliminary injunction which should be made
permanent to enjoin perpetually the [respondent] from
violating [petitioners] right to the exclusive use of their
aforementioned trademarks. [Respondent] filed its
Answer xxx denying [petitioners] material allegations
and xxx averred [among other things] xxx that MARK
is a common word, which cannot particularly identify a
product to be the product of the [petitioners].
Trial court rendered its Decision dismissing the
complaint and counterclaim after making a finding that
the [respondent] did not commit trademark infringement
against the [petitioners]; the issue of whether or not
there was infringement of the [petitioners] trademarks
by the [respondent] was likewise answered xxx in the
negative. CA affirmed the trial courts decision on the
underlying issue of respondents liability for
infringement
IN RELATION TO THE TOPIC ABOVE.
HELD: A trademark is any distinctive word, name,
symbol, emblem, sign, or device, or any combination
thereof adopted and used by a manufacturer or
merchant on his goods to identify and distinguish them
from those manufactured, sold, or dealt in by others.
Inarguably, a trademark deserves protection. For, as
Mr. Justice Frankfurter observed in Mishawaka Mfg.
Co. v. Kresge Co.:
The protection of trademarks is the laws recognition of
the psychological function of symbols. If it is true that
we live by symbols, it is no less true that we purchase
goods by them. A trade-mark is a merchandising shortcut which induces a purchaser to select what he wants,
or what he has been led to believe what he wants. The
owner of a mark exploits this human propensity by
making every effort to impregnate the atmosphere of
the market with the drawing power of a congenial
symbol. Whatever the means employed, the aim is the
same - to convey through the mark, in the minds of
potential customers, the desirability of the commodity
upon which it appears. Once this is attained, the
trade-mark owner has something of value.
If
another poaches upon the commercial magnetism of
the symbol he has created, the owner can obtain legal
redress.
It is thus understandable for petitioners to invoke in this
recourse their entitlement to enforce trademark rights in
this country, specifically, the right to sue for trademark

infringement in Philippine courts and be accorded


protection against unauthorized use of their Philippineregistered trademarks.

NOTES:
The owner of the mark has something of value, so it is
important to protect his mark; protection from the
usurper.
2. Historical Development
Mirpuri vs. CA (G.R. No. 114508, Nov. 19, 1999)
SEE FACTS UNDER COPYRIGHT DISCUSSION.
(THE RULING HERE IS IN RELATION TO THE TOPIC
ABOVE)
HELD: A "trademark" is defined under R.A. 166, the
Trademark Law, as including "any word, name, symbol,
emblem, sign or device or any combination thereof
adopted and used by a manufacturer or merchant to
identify his goods and distinguish them from those
manufactured, sold or dealt in by others." This definition
has been simplified in R.A. No. 8293, the Intellectual
Property Code of the Philippines, which defines a
"trademark" as "any visible sign capable of
distinguishing goods." In Philippine jurisprudence, the
function of a trademark is to point out distinctly the
origin or ownership of the goods to which it is affixed; to
secure to him, who has been instrumental in bringing
into the market a superior article of merchandise, the
fruit of his industry and skill; to assure the public that
they are procuring the genuine article; to prevent fraud
and imposition; and to protect the manufacturer against
substitution and sale of an inferior and different article
as his product.
Modern authorities on trademark law view trademarks
as performing three distinct functions:
(1) they
indicate origin or ownership of the articles to which
they are attached; (2) they guarantee that those
articles come up to a certain standard of quality;
and (3) they advertise the articles they symbolize.
Symbols have been used to identify the ownership or
origin of articles for several centuries. As early as
5,000 B.C., markings on pottery have been found by
archaeologists. Cave drawings in southwestern Europe
show bison with symbols on their flanks. Archaeological
discoveries of ancient Greek and Roman inscriptions
on sculptural works, paintings, vases, precious stones,
glassworks, bricks, etc. reveal some features which are
thought to be marks or symbols. These marks were
affixed by the creator or maker of the article, or by
public authorities as indicators for the payment of tax,
for disclosing state monopoly, or devices for the
settlement of accounts between an entrepreneur and
his workmen. In the Middle Ages, the use of many kinds
of marks on a variety of goods was commonplace.
Fifteenth century England saw the compulsory use of
identifying marks in certain trades. There were the
baker's mark on bread, bottlemaker's marks, smith's
marks, tanner's marks, watermarks on paper, etc.
Every guild had its own mark and every master
belonging to it had a special mark of his own. The
marks were not trademarks but police marks
compulsorily imposed by the sovereign to let the public
know that the goods were not "foreign" goods
smuggled into an area where the guild had a monopoly,
as well as to aid in tracing defective work or poor
craftsmanship to the artisan. For a similar reason,
merchants also used merchants' marks. Merchants
dealt in goods acquired from many sources and the
marks enabled them to identify and reclaim their goods
upon recovery after shipwreck or piracy. With constant
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use, the mark acquired popularity and became


voluntarily adopted. It was not intended to create or
continue monopoly but to give the customer an index or
guarantee of quality. It was in the late 18th century
when the industrial revolution gave rise to mass
production and distribution of consumer goods that the
mark became an important instrumentality of trade and
commerce. By this time, trademarks did not merely
identify the goods; they also indicated the goods to be
of satisfactory quality, and thereby stimulated further
purchases by the consuming public. Eventually, they
came to symbolize the goodwill and business
reputation of the owner of the product and became a
property right protected by law. The common law
developed the doctrine of trademarks and tradenames
"to prevent a person from palming off his goods as
another's, from getting another's business or injuring
his reputation by unfair means, and, from defrauding
the public." Subsequently, England and the United
States enacted national legislation on trademarks as
part of the law regulating unfair trade. It became the
right of the trademark owner to exclude others from the
use of his mark, or of a confusingly similar mark where
confusion resulted in diversion of trade or financial
injury. At the same time, the trademark served as a
warning against the imitation or faking of products to
prevent the imposition of fraud upon the public.

Mirpuri vs. CA (G.R. No. 114508, Nov. 19, 1999)


A "trademark" is defined under R.A. 166, the Trademark
Law, as including "any word, name, symbol, emblem,
sign or device or any combination thereof adopted and
used by a manufacturer or merchant to identify his
goods and distinguish them from those manufactured,
sold or dealt in by others." This definition has been
simplified in R.A. No. 8293, the Intellectual Property
Code of the Philippines, which defines a "trademark" as
"any visible sign capable of distinguishing goods."

Canon Kabushiki Kaisha vs. CA (G.R. No. 120900,


July 20, 2001)
FACTS: Private respondent NSR Rubber Corporation
(private respondent) filed an application for registration
of the mark CANON for sandals in the Bureau of
Patents, Trademarks, and Technology Transfer
(BPTTT). A Verified Notice of Opposition was filed by
petitioner, a foreign corporation duly organized and
existing under the laws of Japan, alleging that it will be
damaged by the registration of the trademark CANON
in the name of private respondent.
The BPTTT then declared private respondent in default
and allowed petitioner to present its evidence ex-parte.
Based on the records, the evidence presented by
petitioner consisted of its certificates of registration for
the mark CANON in various countries covering goods
belonging to class 2 (paints, chemical products, toner,
and dye stuff). Petitioner also submitted in evidence its
Philippine Trademark Registration No. 39398, showing
its ownership over the trademark CANON also under
class 2. The BPTTT issued its decision dismissing the
opposition of petitioner and giving due course to private
respondents application for the registration of the
trademark CANON. Petitioner appealed the decision of
the BPTTT with public respondent Court of Appeals that
eventually affirmed the decision of BPTTT. Hence, this
petition for review.

Today, the trademark is not merely a symbol of origin


and goodwill; it is often the most effective agent for the
actual creation and protection of goodwill. It imprints
upon the public mind an anonymous and impersonal
guaranty of satisfaction, creating a desire for further
satisfaction. In other words, the mark actually sells the
goods. The mark has become the "silent salesman,"
the conduit through which direct contact between the
trademark owner and the consumer is assured. It has
invaded popular culture in ways never anticipated that it
has become a more convincing selling point than even
the quality of the article to which it refers. In the last half
century, the unparalleled growth of industry and the
rapid development of communications technology have
enabled trademarks, tradenames and other distinctive
signs of a product to penetrate regions where the
owner does not actually manufacture or sell the product
itself. Goodwill is no longer confined to the territory of
actual market penetration; it extends to zones where
the marked article has been fixed in the public mind
through advertising. Whether in the print, broadcast or
electronic communications medium, particularly on the
Internet, advertising has paved the way for growth and
expansion of the product by creating and earning a
reputation that crosses over borders, virtually turning
the whole world into one vast marketplace.

RA 8293 Section 121. Definitions. - As used in Part III, the


following terms have the following meanings:

HELD: (In relation to the Topic above)


The term "trademark" is defined by RA 166, the
Trademark Law, as including "any word, name, symbol,
emblem, sign or device or any combination thereof
adopted and used by a manufacturer or merchant to
identify his goods and distinguish them for those
manufactured, sold or dealt in by others." Tradename
is defined by the same law as including "individual
names and surnames, firm names, tradenames,
devices or words used by manufacturers, industrialists,
merchants, agriculturists, and others to identify their
business, vocations, or occupations; the names or titles
lawfully adopted and used by natural or juridical
persons, unions, and any manufacturing, industrial,
commercial, agricultural or other organizations
engaged in trade or commerce." Simply put, a trade
name refers to the business and its goodwill; a
trademark refers to the goods.

121.1. "Mark" means 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; (Sec. 38, R.A. No. 166a)

Societe des Produits vs. CA


(G.R. No. 112012, April 4, 2001)

3. Definition of marks, service marks & collective


marks

121.2. "Collective mark" means any visible sign designated


as such in the application for registration and capable of
distinguishing the origin or any other common
characteristic, including the quality of goods or services of
different enterprises which use the sign under the control of
the registered owner of the collective mark; (Sec. 40, R.A.
No. 166a)

FACTS: Private respondent CFC Corporation filed with


the BPTTT an application for the registration of the
trademark FLAVOR MASTER for instant coffee. The
application, as a matter of due course, was published in
the issue of the BPTTTs Official Gazette.
Petitioner Societe Des Produits Nestle, S.A., a Swiss
company registered under Swiss laws and domiciled in

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Switzerland, filed an unverified Notice of Opposition,


claiming that the trademark of private respondents
product is confusingly similar to its trademarks for
coffee and coffee extracts, to wit: MASTER ROAST and
MASTER BLEND.
Likewise, a verified Notice of Opposition was filed by
Nestle Philippines, Inc., a Philippine corporation and a
licensee of Societe Des Produits Nestle S.A., against
CFCs application for registration of the trademark
FLAVOR MASTER. Nestle claimed that the use, if any,
by CFC of the trademark FLAVOR MASTER and its
registration would likely cause confusion in the trade; or
deceive purchasers and would falsely suggest to the
purchasing public a connection in the business of
Nestle, as the dominant word present in the three (3)
trademarks is MASTER; or that the goods of CFC
might be mistaken as having originated from the latter.
In answer to the two oppositions, CFC argued that its
trademark, FLAVOR MASTER, is not confusingly
similar with the formers trademarks, MASTER ROAST
and MASTER BLEND, alleging that, except for the
word MASTER (which cannot be exclusively
appropriated by any person for being a descriptive or
generic name), the other words that are used
respectively with said word in the three trademarks are
very different from each other in meaning, spelling,
pronunciation, and sound. CFC further argued that its
trademark, FLAVOR MASTER, is clearly very different
from any of Nestles alleged trademarks MASTER
ROAST and MASTER BLEND, especially when the
marks are viewed in their entirety, by considering their
pictorial representations, color schemes and the letters
of their respective labels.
BPTTT denied CFCs application for registration. CA
reversed the decision of the BPTTT and ordered the
Director of Patents to approve CFCs application.
HELD: (In relation to the Topic above)
A trademark has been generally defined as any word,
name, symbol or device adopted and used by a
manufacturer or merchant to identify his goods and
distinguish them from those manufactured and sold by
others. A manufacturers trademark is entitled to
protection. As Mr. Justice Frankfurter observed in the
case of Mishawaka Mfg. Co. v. Kresge Co.: The
protection of trade-marks is the laws recognition of the
psychological function of symbols. If it is true that we
live by symbols, it is no less true that we purchase
goods by them. A trade-mark is a merchandising shortcut which induces a purchaser to select what he wants,
or what he has been led to believe he wants. The
owner of a mark exploits this human propensity by
making every effort to impregnate the atmosphere of
the market with the drawing power of a congenial
symbol. Whatever the means employed, the aim is the
same --- to convey through the mark, in the minds of
potential customers, the desirability of the commodity
upon which it appears. Once this is attained, the trademark owner has something of value.
If another
poaches upon the commercial magnetism of the
symbol he has created, the owner can obtain legal
redress.

goods to which it is affixed; to secure to him, who has


been instrumental in bringing into the market a superior
article of merchandise, the fruit of his industry and skill;
to assure the public that they are procuring the genuine
article; to prevent fraud and imposition; and to protect
the manufacturer against substitution and sale of an
inferior and different article as his product.

Phil. Refining Co. vs. Ng Sam (G.R. No. L-27906


FACTS: The trademark "CAMIA" was first used ill the
Philippines by petitioner on its products in 1922. In
1949, petitioner caused the registration of said
trademark with the Philippine Patent Office under
certificates of registration Nos. 1352-S and 1353-S,
both issued on May 3, 1949. Certificate of Registration
No. 1352-S covers vegetable and animal fats,
particularly lard, butter and cooking oil, all classified
under Class 47 (Foods and Ingredients of Food) of the
Rules of Practice of the Patent Office, while certificate
of registration No. 1353-S applies to abrasive
detergents, polishing materials and soap of all kinds
(Class 4). 1960, respondent Ng Sam filed an
application with the Philippine Patent office for
registration of the Identical trademark "CAMIA" for his
product, ham, which likewise falls under Class 47.
Alleged date of first use of the trademark by respondent
was on February 10, 1959.
After due publication of the application, petitioner filed
an opposition, in accordance with Section 8 of Republic
Act No. 166 (Trademark Law, as amended.) Basis of
petitioner's opposition was Section 4(d) of said law,
which provides as unregistrable: a mark which consists
of or comprises a mark or tradename which so
resembles a mark or tradename registered in the
Philippines or a mark or tradename previously used in
the Philippines by another and not abandoned, as to be
likely, when applied to or used in connection with the
goods, business services of the applicant, to cause
confusion or mistake or to deceive purchasers. The
parties submitted the case for decision without
presenting any evidence: thereafter the Director of
patents rendered a decision allowing registration of the
trademark "CAMIA" in favor of Ng Sam. Petitioner
moved for a reconsideration, but the same was denied.
Hence, this petition.
HELD: (In relation to the Topic above)
A trademark is designed to identify the user. But it
should be so distinctive and sufficiently original as to
enable those who come into contact with it to recognize
instantly the identity of the user. " It must be affirmative
and definite, significant and distinctive, capable to
indicate origin."

5. Nature of a Trademark Right


NOTES:
Nature of a Right to a Trademark: RIGHT OF EXCLUSIVITY

4. Functions of a Trademark
Mirpuri vs. CA (G.R. No. 114508, Nov. 19, 1999)
In Philippine jurisprudence, the function of a trademark
is to point out distinctly the origin or ownership of the

CASES:
Arce Sons and Co vs Ng Sam (1 SCRA 253, 1961)
FACTS: Selecta Biscuit Company, Inc., hereinafter
referred to as respondent, filed with the Philippine
Patent Office a petition for the registration of the word
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"SELECTA" as trade-mark to be use in its bakery


products alleging that it is in actual use thereof for not
less than two months before said date and that "no
other
persons,
partnership,
corporation
or
association ... has the right to use said trade-mark in
the Philippines, either in the identical form or in any
such near resemblance thereto, as might be calculated
to deceive." Its petition was referred to an examiner for
study who found that the trade-mark sought to be
registered resembles the word "SELECTA" used by the
Acre and Sons and Company, hereinafter referred to as
petitioner, in its milk and ice cream products so that its
use by respondent will cause confusion as to the origin
of their respective goods. Consequently, he
recommended that the application be refused.
However, upon reconsideration, the Patent Office
ordered the publication of the application for purposes
of opposition.
In due time, petitioner filed its opposition thereto on
several grounds, among which are: (1) that the mark
"SELECTA" had been continuously used by petitioner
in the manufacture and sale of its products, including
cakes, bakery products, milk and ice cream from the
time of its organization and even prior thereto by its
predecessor-in-interest, Ramon Arce; (2) that the mark
"SELECTA" has already become identified with name
of the petitioner and its business; (3) that petitioner had
warned respondent not to use said mark because it
was already being used by the former, but that the
latter ignored said warning; (4) that respondent is using
the word "SELECTA" as a trade-mark as bakery
products in unfair competition with the products of
petitioner thus resulting in confusion in trade; (5) that
the mark to which the application of respondent refers
has striking resemblance, both in appearance and
meaning, to petitioner's mark as to be mistaken therefor
by the public and cause respondent's goods to be sold
as petitioner's; and (6) that actually a complaint has
been filed by the petitioner against respondent for
unfair competition in the CFI asking for damages and
for the issuance of a writ of injunction against
respondent enjoining the latter for continuing with the
use of said mark.
CFI rendered decision in the unfair competition case
perpetually enjoining respondent from using the name
"SELECTA" as a trade-mark on the goods
manufactured and/or sold by it. However, the Director
of Patents, on December 7, 1958, rendered decision
dismissing petitioner's opposition and stating that the
registration of the trade-mark "SELECTA" in favor of
applicant Selecta Biscuits Company, Inc. will not cause
confusion or mistake nor will deceive the purchasers as
to the cause damage to petitioner. Hence, petitioner
interposed the present petition for review.
HELD: The word 'SELECTA', it is true, may be an
ordinary or common word in the sense that may be
used or employed by any one in promoting his
business or enterprise, but once adopted or coined in
connection with one's business as an emblem, sign
or device to characterize its products, or as a
badge of authenticity, it may acquire a secondary
meaning as to be exclusively associated with its
products and business. In this sense, its used by
another may lead to confusion in trade and cause
damage to its business. And this is the situation of
petitioner when it used the word 'SELECTA' as a trademark. In this sense, the law gives its protection and
guarantees its used to the exclusion of all others. And it
is also in the sense that the law postulates that "The
ownership or possession of a trade-mark, . . . shall
be recognized and protected in the same manner
and to the same extent, as are other property rights
known to the law," thereby giving to any person

entitled to the exclusive use of such trade-mark the


right to recover damages in a civil action from any
person who may have sold goods of similar kind
bearing such trade-mark (Sections 2-A and 23,
Republic Act No. 166, as amended).

Converse Rubber vs. Universal Rubber (G.R. No. L27906, Jan. 8 1987)
FACTS: Respondent Universal Rubber Products, Inc.
filed an application with the Philippine Patent office for
registration of the trademark "UNIVERSAL CONVERSE
AND DEVICE" used on rubber shoes and rubber
slippers. Petitioner Converse Rubber Corporation filed
its opposition to the application for registration on
grounds that: a] The trademark sought to be registered
is confusingly similar to the word "CONVERSE" which
is part of petitioner's corporate name "CONVERSE
RUBBER CORPORATION" as to likely deceive
purchasers of products on which it is to be used to an
extent that said products may be mistaken by the
unwary public to be manufactured by the petitioner;
and, b] The registration of respondent's trademark will
cause great and irreparable injury to the business
reputation and goodwill of petitioner in the Philippines
and would cause damage to said petitioner within the,
meaning of Section 8, R.A. No. 166, as amended.
Thereafter, respondent filed its answer and at the pretrial, the parties submitted the following partial
stipulation of facts: 1] The petitioner's corporate name
is "CONVERSE RUBBER CORPORATION" and has
been in existence since July 31, 1946; it is duly
organized under the laws of Massachusetts, USA and
doing business at 392 Pearl St., Malden, County of
Middle sex, Massachusetts; 2] Petitioner is not licensed
to do business in the Philippines and it is not doing
business on its own in the Philippines; and, 3] Petitioner
manufacturers rubber shoes and uses thereon the
trademarks "CHUCK TAYLOR "and "ALL STAR AND
DEVICE".
Eventually, the Director of Patents dismissed the
opposition of the petitioner and gave due course to
respondent's application.
HELD: (In relation to the Topic above)
A trade name is any individual name or surname, firm
name, device or word used by manufacturers,
industrialists, merchants and others to Identify their
businesses, vocations or occupations. 8 As the trade
name refers to the business and its goodwill ... the
trademark refers to the goods." The ownership of a
trademark or tradename is a property right which
the owner is entitled to protect "since there is
damage to him from confusion or reputation or
goodwill in the mind of the public as well as from
confusion of goods. The modern trend is to give
emphasis to the unfairness of the acts and to
classify and treat the issue as fraud.

6. Trademark vs. Trade Name


Sec. 121.3. "Trade name" means the name or designation
identifying or distinguishing an enterprise; (Sec. 38, R.A.
No. 166a)
Section 165. Trade Names or Business Names. - 165.1. A
name or designation may not be used as a trade name if
by its nature or the use to which such name or designation
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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

may be put, it is contrary to public order or morals and if, in


particular, it is liable to deceive trade circles or the public
as to the nature of the enterprise identified by that name.

other property rights.

165.2.(a) Notwithstanding any laws or regulations providing


for any obligation to register trade names, such names
shall be protected, even prior to or without registration,
against any unlawful act committed by third parties.

Rights ACQUIRED THROUGH REGISTRATION is


considered more superior than that acquired through use.

(b) In particular, any subsequent use of the trade name by


a third party, whether as a trade name or a mark or
collective mark, or any such use of a similar trade name or
mark, likely to mislead the public, shall be deemed
unlawful.

~ the basis of the right through actual use.

The owners of registered marks can sue for


INFRINGEMENT and UNFAIR COMPETITION. While
unregistered marks described in Sec. 168.1 can only sue
for UNFAIR COMPETITION.
CASES:

165.3. The remedies provided for in Sections 153 to 156


and Sections 166 and 167 shall apply mutatis mutandis.

PUMA SPORTSCHUHFABRIKEN vs. IAC (G.R. No.


75067, Feb. 26, 1988)

165.4. Any change in the ownership of a trade name shall


be made with the transfer of the enterprise or part thereof
identified by that name. The provisions of Subsections
149.2 to 149.4 shall apply mutatis mutandis.

FACTS: The petitioner, a foreign corporation duly


organized and existing under the laws of the Federal
Republic of Germany and the manufacturer and
producer of "PUMA PRODUCTS," filed a complaint for
infringement of patent or trademark with a prayer for
the issuance of a writ of preliminary injunction against
the private respondent before the RTC of Makati.

Canon Kabushiki Kaisha vs CA


Prior to the filing of the said civil suit, three cases were
pending before the Philippine Patent Office, namely:

The term "trademark" is defined by RA 166, the


Trademark Law, as including "any word, name, symbol,
emblem, sign or device or any combination thereof
adopted and used by a manufacturer or merchant to
identify his goods and distinguish them for those
manufactured, sold or dealt in by others." Tradename is
defined by the same law as including "individual names
and surnames, firm names, tradenames, devices or
words used by manufacturers, industrialists, merchants,
agriculturists, and others to identify their business,
vocations, or occupations; the names or titles lawfully
adopted and used by natural or juridical persons,
unions, and any manufacturing, industrial, commercial,
agricultural or other organizations engaged in trade or
commerce."[27] Simply put, a trade name refers to the
business and its goodwill; a trademark refers to the
goods.

Inter Partes Case No. 1259 entitled 'PUMA


SPORTSCHUHFABRIKEN
v.
MIL-ORO
MANUFACTURING CORPORATION, respondentapplicant which is an opposition to the registration of
petitioner's trademark 'PUMA and DEVICE' in the
PRINCIPAL REGISTER;
Inter Partes Case No. 1675 similarly entitled, 'PUMA
SPORTSCHUHFABRIKEN RUDOLF DASSLER, K.G.,
petitioner, versus MIL-ORO MANUFACTURING
CORPORATION, respondent-registrant,' which is a
case for the cancellation of the trademark registration
of the petitioner; and
Inter Partes Case No. 1945 also between the same
parties this time the petitioner praying for the
cancellation of private respondent's Certificate of
Registration No. 26875

7. Basis of the Right to a Mark


Section 122. How Marks are Acquired. - The rights in a
mark shall be acquired through registration made validly in
accordance with the provisions of this law.
NOTES:
When are rights to a mark acquired?
The rigth in a mark shall be acquired through registration
made validly in accordance with the provision of the law.
(sec. 122)
But Acquisition of such right CAN BE HAD THROUGH
USE even if w/o registration
SEE: Section 168. Unfair Competition, Rights, Regulation
and Remedies. - 168.1. A person who has identified in the
mind of the public the goods he manufactures or deals in,
his business or services from those of others, whether or
not a registered mark is employed, has a property right in
the goodwill of the said goods, business or services so
identified, which will be protected in the same manner as

Trial court issued a temporary restraining order,


restraining the private respondent and the Director of
Patents from using the trademark "PUMA' or any
reproduction, counterfeit copy or colorable imitation
thereof, and to withdraw from the market all products
bearing the same trademark. On August 9, 1985, the
private respondent filed a motion to dismiss on the
grounds that the petitioners' complaint states no cause
of action, petitioner has no legal personality to sue, and
litis pendentia. On August 19, 1985, the trial court
denied the motion to dismiss and at the same time
granted the petitioner's application for a writ of
injunction. The private respondents appealed to the
Court of Appeals. On June 23, 1986, the Court of
Appeals reversed the order of the trial court and
ordered the respondent judge to dismiss the civil case
filed by the petitioner.
ISSUE:
HELD:

Marvex Commercial Co., Inc. vs petra Hawpia & Co


(G.R. No. L-16297, Dec. 22, 1926)

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INTELLECTUAL PROPERTY LAW SUMMER CLASS 2013-2014

FACTS: Petra Hawpia & Co., a partnership duly


organized under the laws of the Philippines
(hereinafter referred to as the applicant), filed a petition
for the registration of the trademark "LIONPAS" used
on medicated plaster, with the Philippine Patent Office,
asserting its continuous use in the Philippines since
1958. The Marvex Commercial Co., Inc., a corporation
also duly organized under the laws of the Philippines
(hereinafter referred to as the oppositor), filed an
opposition thereto, alleging that the registration of such
trademark would violate its right to and interest in the
trademark "SALONPAS" used on another medicated
plaster, which is registered in its name under Certificate
of Registration 5486, issued by the Director of Patents
on September 29, 1956, and that both trademarks
when used on medicated plaster would mislead the
public as they are confusingly similar.
After due hearing, the Director of Patents dismissed the
opposition and gave due course to the petition, stating
in part that "confusion, mistake, or deception among
the purchasers will not likely and reasonably occur"
when both trademarks are applied to medicated plaster.
The oppositor moved to have the decision
reconsidered. This motion was denied in a resolution
The oppositor then interposed the present appeal.
ISSUE: Is the applicant the owner of the trademark
"LIONPAS?"
HELD: Under sections 2 and 2-A of the Trade Mark
Law, as amended, the right to register trademarks,
tradenames and service marks by any person,
corporation, partnership or association domiciled
in the Philippines or in any foreign country, is
based on ownership, and the burden is upon the
applicant to prove such ownership (Operators, Inc.
vs. The Director of Patents, et al., L-17901, Oct. 29,
1965).
The Director of Patents found, on the strength of
exhibits 5 and 6 for the applicant, that the latter has
"satisfactorily shown" its ownership of the trademark
sought to be registered. Exhibit 5 is a letter dated June
20, 1958, sent by "OSAKA BOEKI KAISHA, LTD." to
the applicant which tends to show that the former, for a
$1 consideration, has assigned, ceded, and conveyed
all its "rights, interests and goodwill in the tradename
LIONPAS Medicated Plaster . . ." in favor of the latter.
Exhibit 6 is a joint "SWORN STATEMENT" which
appears to have been executed by the presidents of
"OSAKA BOEKI KAISHA, LTD." and "ASUNARO
PHARMACEUTICAL INDUSTRY CO.", and tends to
confirm the contents of exhibit 5.
A careful scrutiny of exh. 5 will reveal, however, that the
sender of the letter, "OSAKA BOEKI KAISHA LTD.",
and which appears to be the seller, is merely a
representative of the manufacturer "ASUNARO
PHARMACEUTICAL INDUSTRY CO." There is no
proof that as such representative, the former has been
authorized by the latter to sell the trademark in
question. Moreover, exh. 5 on its face appears to have
been signed only by someone whose position in the
company's "Sundries Dept." is not described; the
signature is not legible. It is even contradicted by exh.
6. While exh. 5 shows that "OSAKA BOEKI KAISHA,
LTD."
is
a
representative
of
"ASUNARO
PHARMACEUTICAL INDUSTRY CO."; exh. 6 asserts
that the former is not a representative of the latter, but
that it is the owner of the trademark "LIONPAS" (par. 2,
exh. 6). At all events, neither averment can be
accorded the weight of an assignment of ownership of
the trademark in question under the Trade Mark Law.
Exh. 5 is not acknowledged. Exh. 6 does not bear the
acknowledgment contemplated by the aforesaid law,
particularly by the last paragraph of section 37 and

paragraph 2 of section 31 of R.A. 166, as amended,


which provide as follows:
The registration of a mark under the provisions of this
section shall be independent of the registration in the
country of origin and the duration, validity or transfer in
the Philippines of such registration shall be governed
by the provisions of this Act. (Sec. 37, last par.)
(Emphasis ours)
The assignment must be in writing, acknowledged
before a notary public or other officer authorized to
administer oaths or perform other notarial acts and
certified under the hand and official seal of the notary
or other officer. (Sec. 31, par. 2)
In this case, although a sheet of paper is attached to
exh. 6, on which is typewritten a certification that the
signatures of the presidents of the two named
companies (referring to the signatures in exh. 6) "have
been duly written by themselves", this sheet is
unmarked, unpaged, unsigned, undated and unsealed.
We have thumbed the record in quest of any definitive
evidence that it is a correct translation of the Japanese
characters found on another unmarked and unpaged
sheet, and have found none. It follows from the above
disquisition that exhs. 5 and 6 are legally insufficient to
prove that the applicant is the owner of the trademark
in question. As a matter of fact, the other evidence on
record conclusively belies the import of exh. 6.
Thus exh. A states that the applicant is merely the
"exclusive distributor" in the Philippines of the
"LIONPAS" penetrative plaster; exh. A-1 describes the
applicant as the "Philippine sole distributor" of
"LIONPAS"; exh. B simply states that "LIONPAS" is
"manufactured exclusively for Petra Hawpia & Co. for
distribution in the Philippines." Not being the owner of
the trademark "LIONPAS" but being merely an
importer and/or distributor of the said penetrative
plaster, the applicant is not entitled under the law
to register it in its name (Operators, Inc. vs. Director
of Patents, supra).

Operators Inc vs. Director of Patents (G.R. No. L17902, Oct. 29, 1965)
FACTS: Petitioner, a domestic corporation, applied to
the Philippine Patent Office for registration of AMBISCO
as a trademark for its locally manufactured candy
products. It has been using said trademark since May
1956 by virtue of two contracts with the American
Biscuit Company, also a domestic corporation. The
National Biscuit Company opposed the application,
having previously registered NABISCO as trademark
for its own bakery goods, such as biscuits, crackers,
cakes and wafers. The oppositor, a corporation
organized in the United States, has had the said
trademark registered in the Philippines since 1930, and
renewed the registration in 1948 under the latest
trademark law.
ISSUE: Whether or not the applicant had a right in the
first place to apply for registration of AMBISCO as a
trademark at all.
HELD: Under section 2 of Republic Act No. 166, as
amended by section 1 of Republic Act No. 865,
trademarks, tradenames, and service marks, owned by
persons, corporations, partnerships or associations
domiciled in the Philippines or in any foreign country
may be registered here provided certain conditions
enumerated in the same section are complied with. The
right to register, as may be noted, is based on
ownership. In the case of the trademark AMBISCO,
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the evidence shows that it is owned by the American


Biscuit Co., Inc., and not by petitioner Operators, Inc.
Such evidence consists of the certification signed jointly
by Jorge B. Vargas and by Eu Chua Leh, presidents of
the said Corporations, respectively, as follows (Exh. 2):
On September 26, 1953, and on June 12, 1954, the
American Biscuit Co., Inc., and the Operators
Incorporated, both corporations organized under the
laws of the Philippines, entered into contracts, and
under such contracts, the Operators Incorporated is
authorized by the American Biscuit Co., Inc. to operate
the candy business of the latter and among the various
terms and stipulations in said contracts, the Operators
Incorporated agreed to distinctly label and display all
products manufactured and sold by it as products of
the American Biscuit Co., Inc. and that all the
trademarks contained in such labels shall be
considered as property of the American Biscuits Co.,
Inc.
Petitioner objects to the consideration of the question of
ownership of the trademark as an issue on the ground
that it was not raised by respondent either in its
opposition or in its memorandum filed after the parties
had adduced their evidence. In the first place
respondent could not have known at the outset that
petitioner was not the owner of the trademark it was
seeking to register. That fact was brought out for the
first time when the certification quoted above was
presented. Secondly, it was incumbent upon petitioner,
as applicant, to prove that it had a right to register the
trademark applied for and consequently, to show
compliance with all the legal requisites including
ownership thereof. An application for registration under
the Patent Law is not an ordinary litigious controversy
between private parties. Public interest is involved and
all questions as to whether or not the law is satisfied
may be considered by the Patent Office or by the Court
even though not specifically raised by either of the
parties.

Gabriel vs. perez (G.R. No. L-24075, Jan 31, 1974)


FACTS:
ISSUE:
HELD:

Unno vs. General Milling (G.R. No L-28554, Feb. 28,


1983)
FACTS: Respondent General Milling Corporation filed
an application for the registration of the trademark "All
Montana" to be used in the sale of wheat flour. In view
of the fact that the same trademark was previously,
registered in favor of petitioner Unno Commercial
Enterprises, Inc., the Chief Trademark Examiner of the
Philippines Patent Office declared an interference
proceeding
between
respondent
corporation's
application, as Junior - Party-Applicant and petitioner
company's registration, as Senior Party-Applicant,
docketed in the Philippines Patent Office as Inter
Partes Case No. 313, to determine which party has
previously adopted and used the trademark "All
Montana".
Respondent General Milling Corporation, in its
application for registration, alleged that it started using
the trademark "All Montana" on August 31, 1955 and
subsequently was licensed to use the same by
Centennial Mills, Inc. by virtue of a deed of assignment

executed. On the other hand petitioner Unno


Commercial Enterprises, Inc. argued that the same
trademark had been registered in its favor on March 8,
1962 asserting that it started using the trademark on
June 30, 1956, as indentor or broker for S.H. Huang
Bros. & Co., a local firm.
Director of Patents, after hearing, ruled in favor of
respondent General Milling Corporation.
PETITIONER'S ARGUMENTS: Petitioner based its
claim of ownership over the trademark in question by
the fact that it acted as an indentor or broker for S. H.
Huang Bros. & Co., a local importer of wheat flour,
offering as evidence the various shipments,
documents, invoices and other correspondence of
Centennial Mills, Inc., shipping thousand of bags of
wheat flour bearing the trademark "All Montana" to the
Philippines. Petitioner argued that these documents,
invoices and correspondence proved the fact that it has
been using the trademark "All Montana" as early as
1955 in the concept of an owner and maintained that
anyone, whether he is only an importer, broker or
indentor can appropriate, use and own a particular
mark of its own choice although he is not the
manufacturer of the goods he deals with. Relying on
the provisions of Section 2-A of the Trademarks Law 2
(Republic Act 166), petitioner insists that "the
appropriation and ownership of a particular trademark
is not merely confined to producers or manufacturers
but likewise to anyone who lawfully deals in
merchandise who renders any lawful service in
commerce, like petitioner in the case at bar.
HELD: The right to register trademark is based on
ownership. When the applicant is not the owner of the
trademark being applied for, he has no right to apply for
the registration of the same. Under the Trademark Law
only the owner of the trademark, trade name or service
mark used to distinguish his goods, business or service
from the goods, business or service of others is entitled
to register the same.
The term owner does not include the importer of the
goods bearing the trademark, trade name, service
mark, or other mark of ownership, unless such importer
is actually the owner thereof in the country from which
the goods are imported. A local importer, however,
may make application for the registration of a
foreign trademark, trade name or service mark if he
is duly authorized by the actual owner of the name
or other mark of ownership. Thus, this Court, has on
several occasions ruled that where the applicant's
alleged ownership is not shown in any notarial
document and the applicant appears to be merely an
importer or distributor of the merchandise covered by
said trademark, its application cannot be granted.
Moreover, the provision relied upon by petitioner (Sec.
2-A, Rep. Act No. 166) allows one "who lawfully
produces or deals in merchandise ... or who engages in
any lawful business or who renders any lawful service
in commerce, by actual use thereof . . . (to) appropriate
to his exclusive use a trademark, or a service mark not
so appropriated by another. " In the case at bar, the
evidence showed that the trademark "All Montana" was
owned and registered in the name of Centennial Mills,
Inc. which later transferred it to respondent General
Milling Corporation by way of a deed of assignment. It
is undisputed that way back in March, 1955, Centennial
Mills, Inc. under the tradename Wenatchee Milling Co.,
exported flour to the Philippines, through its distributor,
herein petitioner Unno Commercial Enterprises, Inc.
which acted as indentor or broker for the firm S. H.
Huang Bros. & Co. However, because of increased
taxes and subsidies, Centennial Mills discontinued
shipments of flour in the Philippines and eventually sold
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its brands for wheat flour, including "All Montana" brand


to respondent General Milling Corporation in
consideration of 1,000 shares of stock of respondent
corporation with a par value of P100.00 per share or a
total of P100,000.00. Respondent General Milling
Corporation, since the start of the operation in 1961 of
its flour mills located in Lapu-lapu City, Cebu has been
manufacturing and selling "All Montana" flour in the
Philippines.
As against petitioner's argument that respondent failed
to establish convincingly the ownership of the
trademark "All Montana" by its assignor Centennial
Mills, Inc., the Director of Patents correctly found that
ample evidence was presented that Centennial Mills,
Inc. was the owner and prior user in the Philippines of
the trademark "All Montana" through a local importer
and broker. The Deed of Assignment itself constitutes
sufficient proof of its ownership of the trademark "All
Montana," showing that Centennial Mills was a
corporation duly organized and existing under and by
virtue of the laws of the State of Oregon, U.S.A. with
principal place and business at Portland, Oregon,
U.S.A. and the absolute and registered owner of
several trademarks for wheat flour, of which were
assigned by it to respondent General Milling
Corporation.
Trademarks used and adopted on goods manufactured
or packed in a foreign country in behalf of a domestic
importer, broker, or indentor and distributor are
presumed to be owned by the manufacturer or packer,
unless there is a written agreement clearly showing that
ownership vests in the importer, broker, indentor or
distributor.
Thus, petitioner's contention that it is the owner of the
mark "All Montana" because of its certificate of
registration issued by the Director of Patents, must fail,
since ownership of a trademark is not acquired by the
mere fact of registration alone. Registration merely
creates a prima facie presumption of the validity of the
registration, of the registrant's ownership of the
trademark and of the exclusive right to the use thereof.
Registration does not perfect a trademark right. As
conceded itself by petitioner, evidence may be
presented to overcome the presumption. Prior use by
one will controvert a claim of legal appropriation,
by subsequent users. In the case at bar, the Director
of Patents found that "ample evidence was presented
in the record that Centennial Mills, Inc. was the owner
and prior user in the Philippines of the trademark 'All
Montana' through a local importer and broker. Use of a
trademark by a mere importer, indentor or exporter (the
Senior Party herein) inures to the benefit of the foreign
manufacturer whose goods are Identified by the
trademark. The Junior Party has hereby established a
continuous chain of title and, consequently, prior
adoption and use" and ruled that "based on the facts
established, it is safe to conclude that the Junior Party
has satisfactorily discharged the burden of proving
priority of adoption and use and is entitled to
registration."

How is ownership over a mark required?


Emerald Garments Mfg. Corp vs. CA (G.R. No.
100098, December 29, 1995, 251 SCRA 600)

FACTS: Private respondent H.D. Lee Co., Inc., a


foreign corporation organized under the laws of
Delaware, U.S.A., filed with the BPTTT a Petition for
Cancellation
of
Registration
No.
SR
5054
(Supplemental Register) for the trademark "STYLISTIC

MR. LEE" used on skirts, jeans, blouses, socks, briefs,


jackets, jogging suits, dresses, shorts, shirts and
lingerie under Class 25, issued on 27 October 1980 in
the name of petitioner Emerald Garment Manufacturing
Corporation, a domestic corporation organized and
existing under Philippine laws.
Private respondent, invoking Sec. 37 of R.A. No. 166
(Trademark Law) and Art. VIII of the Paris Convention
for the Protection of Industrial Property, averred that
petitioner's trademark "so closely resembled its own
trademark, 'LEE' as previously registered and used in
the Philippines, and not abandoned, as to be likely,
when applied to or used in connection with petitioner's
goods, to cause confusion, mistake and deception on
the part of the purchasing public as to the origin of the
goods." In its answer, petitioner contended that its
trademark was entirely and unmistakably different from
that of private respondent and that its certificate of
registration was legally and validly granted.
Director of Patents rendered a decision granting private
respondent's petition for cancellation and opposition to
registration. The Director of Patents found private
respondent to be the prior registrant of the trademark
"LEE" in the Philippines and that it had been using said
mark in the Philippines. CA affirmed the decision of
Director of Patents in all respect.

HELD: SC are constrained to agree with petitioner's


contention that private respondent failed to prove prior
actual commercial use of its "LEE" trademark in the
Philippines before filing its application for registration
with the BPTTT and hence, has not acquired ownership
over said mark. Actual use in commerce in the
Philippines is an essential prerequisite for the
acquisition of ownership over a trademark pursuant to
Sec. 2 and 2-A of the Philippine Trademark Law (R.A.
No. 166) which explicitly provides that:
CHAPTER II. Registration of Marks and Trade-names.
Sec. 2. What are registrable. Trade-marks, tradenames, and service marks owned by persons,
corporations, partnerships or associations domiciled in
the Philippines and by persons, corporations,
partnerships, or associations domiciled in any foreign
country may be registered in accordance with the
provisions of this act: Provided, That said trademarks, trade-names, or service marks are actually
in use in commerce and services not less than two
months in the Philippines before the time the
applications for registration are filed: And
Provided, further, That the country of which the
applicant for registration is a citizen grants by law
substantially similar privileges to citizens of the
Philippines, and such fact is officially certified, with a
certified true copy of the foreign law translated into the
English language, by the government of the foreign
country to the Government of the Republic of the
Philippines.
Sec. 2-A. Ownership of trade-marks, trade-names and
service-marks; how acquired. Anyone who lawfully
produces or deals in merchandise of any kind or who
engages in lawful business, or who renders any lawful
service in commerce, by actual use hereof in
manufacture or trade, in business, and in the service
rendered; may appropriate to his exclusive use a trademark, a trade-name, or a service-mark not so
appropriated
by another, to
distinguish
his
merchandise, business or services from others. The
ownership or possession of trade-mark, trade-name,
service-mark, heretofore or hereafter appropriated, as
in this section provided, shall be recognized and
protected in the same manner and to the same extent
as are other property rights to the law.
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The provisions of the 1965 Paris Convention for the


Protection of Industrial Property relied upon by private
respondent and Sec. 21-A of the Trademark Law (R.A.
No. 166) were sufficiently expounded upon and
qualified in the recent case of Philip Morris, Inc. v.
Court of Appeals:
xxx xxx xxx

Sec. 20. Certificate of registration prima facie evidence


of validity. A certificate of registration of a mark or
tradename shall be a prima facie evidence of the
validity of the registration, the registrant's ownership of
the mark or trade-name, and of the registrant's
exclusive right to use the same in connection with the
goods, business or services specified in the certificate,
subject to any conditions and limitations stated therein.

Following universal acquiescence and comity, our


municipal law on trademarks regarding the requirement
of actual use in the Philippines must subordinate an
international agreement inasmuch as the apparent
clash is being decided by a municipal tribunal. Withal,
the fact that international law has been made part of
the law of the land does not by any means imply the
primacy of international law over national law in the
municipal sphere. Under the doctrine of incorporation
as applied in most countries, rules of international law
are given a standing equal, not superior, to national
legislative enactments.

The credibility placed on a certificate of registration of


one's trademark, or its weight as evidence of validity,
ownership and exclusive use, is qualified. A registration
certificate serves merely as prima facie evidence. It is
not conclusive but can and may be rebutted by
controverting evidence. Moreover, the aforequoted
provision applies only to registrations in the principal
register. Registrations in the supplemental register do
not enjoy a similar privilege. A supplemental register
was created precisely for the registration of marks
which are not registrable on the principal register due to
some defects.

xxx xxx xxx

For lack of adequate proof of actual use of its


trademark in the Philippines prior to petitioner's use of
its own mark and for failure to establish confusing
similarity
between
said
trademarks,
private
respondent's action for infringement must necessarily
fail.

In other words, (a foreign corporation) may have the


capacity to sue for infringement irrespective of lack of
business activity in the Philippines on account of
Section 21-A of the Trademark Law but the question of
whether they have an exclusive right over their symbol
as to justify issuance of the controversial writ will
depend on actual use of their trademarks in the
Philippines in line with Sections 2 and 2-A of the same
law. It is thus incongruous for petitioners to claim that
when a foreign corporation not licensed to do business
in the Philippines files a complaint for infringement, the
entity need not be actually using its trademark in
commerce in the Philippines. Such a foreign
corporation may have the personality to file a suit for
infringement but it may not necessarily be entitled to
protection due to absence of actual use of the emblem
in the local market.
xxx xxx xxx
Undisputably, private respondent is the senior
registrant, having obtained several registration
certificates for its various trademarks "LEE,"
"LEERIDERS," and "LEESURES" in both the
supplemental and principal registers, as early as 1969
to 1973. However, registration alone will not suffice. In
Sterling Products International, Inc. v. Farbenfabriken
Bayer Aktiengesellschaft, we declared: xxx xxx xxx A
rule widely accepted and firmly entrenched because it
has come down through the years is that actual use in
commerce or business is a prerequisite in the
acquisition of the right of ownership over a trademark.
xxx xxx xxx
It would seem quite clear that adoption alone of a
trademark would not give exclusive right thereto.
Such right "grows out of their actual use."
Adoption
is
not
use.
One
may
make
advertisements, issue circulars, give out price lists
on certain goods; but these alone would not give
exclusive right of use. For trademark is a creation
of use. The underlying reason for all these is that
purchasers have come to understand the mark as
indicating the origin of the wares. Flowing from this
is the trader's right to protection in the trade he has
built up and the goodwill he has accumulated from
use of the trademark. Registration of a trademark,
of course, has value: it is an administrative act
declaratory of a pre-existing right. Registration
does not, however, perfect a trademark right. xxx
xxx xxx
To augment its arguments that it was, not only the prior
registrant, but also the prior user, private respondent
invokes Sec. 20 of the Trademark Law, thus:

How is trademark use proven?


Converse Rubber vs. Universal Rubber (G.R. No. L27906, Jan. 8, 1987)
The testimony of petitioner's witness, who is a
legitimate trader as well as the invoices evidencing
sales of petitioner's products in the Philippines, give
credence to petitioner's claim that it has earned a
business reputation and goodwill in this country. The
sales invoices submitted by petitioner's lone witness
show that it is the word "CONVERSE" that mainly
Identifies petitioner's products, i.e. "CONVERSE
CHUCK TAYLOR, "CONVERSE ALL STAR," ALL STAR
CONVERSE CHUCK TAYLOR," or "CONVERSE
SHOES CHUCK and TAYLOR."
Thus, contrary to the determination of the respondent
Director of Patents, the word "CONVERSE" has grown
to be identified with petitioner's products, and in this
sense, has acquired a second meaning within the
context of trademark and tradename laws.
Furthermore, said sales invoices provide the best
proof that there were actual sales of petitioner's
products in the country and that there was actual
use for a protracted period of petitioner's
trademark or part thereof through these sales. "The
most convincing proof of use of a mark in
commerce is testimony of such witnesses as
customers, or the orders of buyers during a certain
period. Petitioner's witness, having affirmed her
lack of business connections with petitioner, has
testified as such customer, supporting strongly
petitioner's move for trademark pre-emption.

Sterling Products International, Inc. v.


Farbenfabriken Bayer Aktiengesellschaft (G.R. No.
L-19906, April 30, 1969)
FACTS: The Bayer Cross in circle trademark was
registered in Germany in 1904 to Farbenfabriken vorm.
Friedr. Bayer (FFB), successor to the original Friedr.
Bauyer et. Comp., and predecessor to Farbenfabriken
Bayer aktiengessel craft (FB2). The Bayer, and Bayer
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three (3) years from the filing date of the application.


Otherwise, the application shall be refused or the mark
shall be removed from the Register by the Director.

Cross in circle trademarks were acquired by sterling


Drug Inc. when it acquired FFBs subsidiary Bayer Co.
of New York as a result of the sequestration of its
assets by the US Alien Property Custodian during
World War I. Bayer products have been known in
Philippines by the close of the 19 th century. Sterling
Drugs, Inc., however, owns the trademarks Bayer in
relation to medicine.
Farbenfabriken Bayer
Aktiengesellschaft (FBA) attempted to register its
chemical products with the Bayer Cross in circle
trademarks. Sterling Products International and FBA
seek to exclude each other from use of the trademarks
in the Philippines. The trial court sustained SPIs right
to use the Bayer trademark for medicines and directed
FBA to add distinctive word(s) in their mark to indicate
their products come from Germany. Both appealed.

SEE THE CASE OF SHANGRI-LA INT'L HOTEL


MANAGEMENT VS. CA (G.R. NO. 111580, JUNE 2, 2001)
SHANGRI-LA INT'L HOTEL MANAGEMENT VS. CA
(G.R. NO. 111580, JUNE 2, 2001)

Even if a person is issued a certificate of


registration, such is not conclusive of his right to
the mark because it is conditioned on presenting
proof of actual use, which is the basis for
ownership over the mark.

HELD: . A rule widely accepted and firmly entrenched


because it has come down through the years is that
actual use in commerce or business is a prerequisite to
the acquisition of the right of ownership over a
trademark. This rule is spelled out in our. Trademark
Law thus: (SEE: RA No. 166--Trademark Law SEC. 2A; look from the previous case)

Registration is not a mode of acquiring ownership....

It would seem quite clear that adoption alone of a


trademark would not give exclusive right thereto. Such
right grows out of their actual use." Adoption is not use.
One may make advertisements, issue circulars, give
out price lists on certain goods; but these alone would
not give exclusive right of use. For trademark is a
creation of use. The underlying reason for all these is
that Purchasers have come to understand the mark as
indicating the origin of the wares. Flowing from this is
the trader's right to protection in the trade he has
built up and the goodwill he has accumulated from
use of the trademark. Registration of a trademark,
of course, has value: it is an administrative act
declaratory of a pre-existing right. Registration
does not, however, perfect a trademark right.

Prior use is no longer a condition for filing or registration.


However, the applicant or registrant shall file...
Section 152. Non-use of a Mark When Excused. - 152.1.
Non-use of a mark may be excused if caused by
circumstances arising independently of the will of the
trademark owner. Lack of funds shall not excuse non-use
of a mark.
152.2. The use of the mark in a form different from the form
in which it is registered, which does not alter its distinctive
character, shall not be ground for cancellation or removal
of the mark and shall not diminish the protection granted to
the mark.

The BAYER trademarks registered in the Philippines to


which plaintiff SPI may lay claim, as correctly stated in
the decision below, are those which cover medicines
only. For, it was on said goods that the BAYER
trademarks were actually used by it in the Philippines.
Therefore, the certificates of registration for medicines
issued by the Director of Patents upon which the
protection is enjoyed are only for medicines. Nothing in
those certificates recited would include chemical or
insecticides.

152.3. The use of a mark in connection with one or more of


the goods or services belonging to the class in respect of
which the mark is registered shall prevent its cancellation
or removal in respect of all other goods or services of the
same class.
152.4. The use of a mark by a company related with the
registrant or applicant shall inure to the latter's benefit, and
such use shall not affect the validity of such mark or of its
registration: Provided, That such mark is not used in such
manner as to deceive the public. If use of a mark by a
person is controlled by the registrant or applicant with
respect to the nature and quality of the goods or services,
such use shall inure to the benefit of the registrant or
applicant. (n)

Berris Agricultural Co. Inc. vs Norby Abyadang


(G.R. No. 183404)

8. Prior Use of a Mark


IS proof of prior use a requirement for registration? (There
is a change--no use requirement in new law)
Although "use" is a requirement for registration, no
application for trademark registration should be refused
even if the applicant has not shown proof of use at the time
of filing the application.

Section 138. Certificates of Registration. - A certificate of


registration of a mark shall be prima facie evidence of the
validity of the registration, the registrant's ownership of the
mark, and of the registrant's exclusive right to use the
same in connection with the goods or services and those
that are related thereto specified in the certificate. (Sec. 20,
R.A. No. 165)
9. Who may apply for a trademark?

PROOF OF USE. may by presented subsequent to the


filing.
SEE: Sec. 124.2. The applicant or the registrant shall file a
declaration of actual use of the mark with evidence to
that effect, as prescribed by the Regulations within

Sec. 3 IPC Section 3. International Conventions and


Reciprocity. - Any person who is a national or who is
domiciled or has a real and effective industrial
establishment in a country which is a party to any
convention, treaty or agreement relating to intellectual

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property rights or the repression of unfair competition, to


which the Philippines is also a party, or extends reciprocal
rights to nationals of the Philippines by law, shall be
entitled to benefits to the extent necessary to give effect to
any provision of such convention, treaty or reciprocal law,
in addition to the rights to which any owner of an
intellectual property right is otherwise entitled by this Act.

(g) (DESCRIPTIVELY MISLEADING) Is likely to mislead


the public, particularly as to the nature, quality,
characteristics or geographical origin of the goods or
services;
(h) (GENERIC MARKS) Consists exclusively of signs that
are generic for the goods or services that they seek to
identify;

10. Registrability of a Mark


Section 123. Registrability. - 123.1. A mark cannot be
registered if it:
(a) Consists of immoral, deceptive or scandalous matter, or
matter which may disparage or falsely suggest a
connection with persons, living or dead, institutions, beliefs,
or national symbols, or bring them into contempt or
disrepute;
(b) Consists of the flag or coat of arms or other insignia of
the Philippines or any of its political subdivisions, or of any
foreign nation, or any simulation thereof;
(c) Consists of a name, portrait or signature identifying a
particular living individual except by his written consent, or
the name, signature, or portrait of a deceased President of
the Philippines, during the life of his widow, if any, except
by written consent of the widow;
(d) (FIRST TO FILE RULE) Is identical with a registered
mark belonging to a different proprietor or a mark with an
earlier filing or priority date, in respect of:

(i) (GENERICIDAL MARKS) Consists exclusively of signs


or of indications that have become customary or usual to
designate the goods or services in everyday language or in
bona fide and established trade practice;
Ex. Elevator, Scotch tape
(j) (DESCRIPTIVE MARKS) Consists exclusively of signs
or of indications that may serve in trade to designate the
kind, quality, quantity, intended purpose, value,
geographical origin, time or production of the goods or
rendering of the services, or other characteristics of the
goods or services;
Note: Descriptive terms forthwith conveys the
characteristics, functions, qualities or ingredients of a
product to one who has never seen it does not know what it
is, "or" if it forthwith conveys an immediate idea of the
ingredients, qualities or characteristics of the goods," or if it
clearly denotes what goods or services are provided in
such a way that the consumer does not have to exercise
powers of perception or imagination (Societe de produits
case)
(k) Consists of shapes that may be necessitated by
technical factors or by the nature of the goods themselves
or factors that affect their intrinsic value;

i) The same goods or services, or


ii) Closely related goods or services, or
iii) If it nearly resembles such a mark as to be likely
to deceive or cause confusion; (CONFUSING SIMILARITY)
(e) (UNREGISTERED INTERNATIONAL WELL-KNOWN
MARKS) Is identical with, or confusingly similar to, or
constitutes a translation of a mark which is considered by
the competent authority of the Philippines to be wellknown internationally and in the Philippines, whether or
not it is registered here, as being already the mark of a
person other than the applicant for registration, and used
for identical or similar goods or services: Provided, That in
determining whether a mark is well-known, account shall
be taken of the knowledge of the relevant sector of the
public, rather than of the public at large, including
knowledge in the Philippines which has been obtained as a
result of the promotion of the mark;
(f) (REGISTERED WELL-KNOWN MARKS) Is identical
with, or confusingly similar to, or constitutes a translation of
a mark considered well-known in accordance with the
preceding paragraph, which is registered in the
Philippines with respect to goods or services which
are not similar to those with respect to which
registration is applied for: Provided, That use of the mark
in relation to those goods or services would indicate a
connection between those goods or services, and the
owner of the registered mark: Provided further, That the
interests of the owner of the registered mark are likely to be
damaged by such use;

(l) Consists of color alone, unless defined by a given form;


or
(m) Is contrary to public order or morality.
123.2. As regards signs or devices mentioned in
paragraphs (j), (k), and (l), nothing shall prevent the
registration of any such sign or device which has become
distinctive in relation to the goods for which registration is
requested as a result of the use that have been made of it
in commerce in the Philippines. The Office may accept as
prima facie evidence that the mark has become distinctive,
as used in connection with the applicant's goods or
services in commerce, proof of substantially exclusive and
continuous use thereof by the applicant in commerce in the
Philippines for five (5) years before the date on which the
claim of distinctiveness is made.
123.3. The nature of the goods to which the mark is applied
will not constitute an obstacle to registration. (Sec. 4, R.A.
No. 166a)
CASES:
Emerald Garments Mfg Corp v CA (G.R. No. 100098,
Dec. 29, 1995)
What marks are registrable pursuant to Sec. 4 of R.A.
No. 166, particularly paragraph 4 (e):

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CHAPTER II-A. The Principal Register


(Inserted by Sec. 2, Rep. Act No. 638.)
Sec. 4. Registration of trade-marks, trade-names and
service-marks on the principal register. There is
hereby established a register of trade-marks, tradenames and service-marks which shall be known as the
principal register. The owner of a trade-mark, tradename or service-mark used to distinguish his goods,
business or services from the goods, business or
services of others shall have the right to register the
same on the principal register, unless it:
xxx xxx xxx
(e) Consists of a mark or trade-name which, when
applied to or used in connection with the goods,
business or services of the applicant is merely
descriptive or deceptively misdescriptive of them, or
when applied to or used in connection with the goods,
business or services of the applicant is primarily
geographically descriptive or deceptively misdescriptive
of them, or is primarily merely a surname; (Emphasis
ours.)
xxx xxx xxx
"LEE" is primarily a surname. Private respondent
cannot, therefore, acquire exclusive ownership over
and singular use of said term. . . . It has been held that
a personal name or surname may not be monopolized
as a trademark or tradename as against others of the
same name or surname. For in the absence of
contract, fraud, or estoppel, any man may use his
name or surname in all legitimate ways. Thus,
"Wellington" is a surname, and its first user has no
cause of action against the junior user of "Wellington"
as it is incapable of exclusive appropriation.
Ang vs. Wellington (92 Phil 448 (1953))
FACTS: The plaintiffs-appellants herein are engaged in
the business of manufacturing shirts, pants, drawers,
and other articles of wear for men, women, and
children. They have been in that business since the
year 1938, having obtained the registration for the said
articles the trademark of "Wellington." In the year 1940
they registered the business name "Wellington
Company," and this registration of the name was
renewed on June 11, 1946. Their invoices, stationery,
and signboard bear the trade name "Wellington
Company," and in newspaper advertisements they
described their business as "Wellington Shirt Factory."
It does not appear, however, that their trademark for
their articles of wear was again registered after August
27, 1938, nor their trade name registered after 1946.
Defendant Benjamin Chua applied for the registration
of the business name "Wellington Department Store"
on May 7, 1946. His application therefor was approved
by the Bureau of Commerce, and a certificate issued in
his favor. On June 8, 1946, this business name was
transferred to Wellington Department Store, Inc., of
which he is the president. It does not appear, however,
that his application with the Bureau of Commerce for
the registration of the business name "Wellington
Department Store" has been renewed, and neither
does it appear that the business name "Wellington
Company" applied for by plaintiffs- appellants has also
been renewed.
The plaintiffs-appellants allege that the use of the
words "Wellington Department Store" as a business
name and as a corporate name by the defendantappellee deceives the public into buying defendant
corporation's goods under the mistaken belief that the
names are the plaintiff's or have the same source as

plaintiffs' goods, thereby resulting in damage to them.


They, therefore, pray that the defendant corporation be
enjoined from using the business name "Wellington
Department Store" and the corporate name "Wellington
Department Store, Inc"; that the Director of Commerce
be ordered to cancel the registration of said business
name, and the Securities and Exchange Commissioner
be also ordered to cancel the corporate name
"Wellington Department Store, Inc."
The court a quo dismissed the complaint and absolved
the defendants therefrom, holding that the corporate
name "Wellington Department Store Inc.," has not been
previously acquired and appropriated by any person or
corporation.
HELD: The term "Wellington" is either a geographical
name (see Webster's International Dictionary, where it
is said to be the capital of New Zealand; urban district
of Shropshire, England and of Somersetshire, England;
co. seat, of Summer co., Kans, etc.), or the surname of
a person. But mere geographical names are ordinarily
regarded as common property, and it is a general rule
that the same cannot be appropriated as the subject of
an exclusive trademark or trade name. (52 Am. Jur.,
548.) Even if Wellington were a surname, which is not
even that of the plaintiffs-appellants, it cannot also be
validly registered as a trade name. (Section 4,
Paragraph (e), Republic Act. No. 166.) As the term
cannot be appropriated as a trademark or a trade
name, no action for violation thereof can be
maintained, as none is granted by the statute in such
cases. The right to damages and for an injunction for
infringement of a trademark or a trade name is granted
only to those entitled to the exclusive use of a
registered trademark or trade name. (Section 23,
Republic Act No. 166.) It is evident, therefore, that no
action may lie in favor of the plaintiffs-appellants herein
for damages or injunctive relief for the use by the
defendants- appellees of the name "Wellington."

Identical with Prior marks

CASES:
Chuanchow Soy & Canning Co. vs. Director of
Patents (108 Phil 833)
FACTS: Both petitioner Chuanchow Soy & Canning
Co. and respondent Rosario Villapania are engaged in
the manufacture and sale of soy sauce. Since 1950,
petitioner had been using as trade mark the words
"Carp Brand Soy", printed in a distinctive style of
lettering above the drawing of a fish to distinguish its
product, on labels affixed directly to the bottles
containing soy sauce, and on tissue paper in which
these bottles were wrapped. In 1953, the Patent Office
issued Trademark Registration Certificate 4384 to it for
its aforesaid trademark. Respondent Villapania since
1956 had been using as trademark of her soy sauce
the name of "Bangos Brand" written in the same
distinctive style of lettering as that of the petitioner's
"Carp Brand", above the drawing of the fish similar to
the fish drawing on the trademark of petitioner, on
labels also attached to the bottles containing her soy
sauce, and the bottles were wrapped also in tissue
paper bearing a similar design. Villapania applied for
registration of her trademark as above-described. Upon
examination of the trademark, the examiner of the
Office of the Director of Patents made the following
ruling:
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1. Examiner has taken into consideration a previously


registered mark: CARP BRAND & fish representation
for soy sauce of the Chuanchow Soy & Caning Co.,
and found that the fish representation closely
resembles to applicant's mark as presented in the
drawing. In view thereof, the applicant must submit new
drawings and facsimiles for the word: "BANGOS
BRAND" only as shown in the labels submitted,
excluding SOY and fish representation.
Complying with said ruling, respondent Villapania
submitted a drawing of the word "Bangos Brand" only,
the same was published in the Official Gazette.
However, she continued and is supposedly still
continuing to use the labels and wrappers Exhibits D
and E on the bottles containing her product, which as
already stated, included not only "Bangos Brand" but
also the word "Soy" above the drawing of the fish.
Petitioner company filed its opposition to respondent's
application. Respondent Director of Patents rendered a
decision dismissing petitioner's opposition to the
application above-stated, which decision is now on
appeal.
HELD: one applies for the registration of a trademark
or label which is almost the same or very closely
resembles one already used and registered by another,
the application should be rejected and dismissed
outright, even without any opposition on the part of the
owner and user of a previously registered label or
trademark, this not only to avoid confusion on the part
of the public, but also to protect an already used and
registered trademark and an established goodwill.
There should be no halfway measures, as was done in
this case by the ruling of the examiner who directed the
respondent to amend or modify the labelor trademark
she sought to register by eliminating some portions
thereof. As a result, although the word "Soy" and the
drawing of a fish were eliminated, still, the word
"Bangos" and the word "Brand" which are similar to the
style of lettering of the corresponding words in the
label, Exhibit B, of petitioner, could still create
confusion or doubt in the mind of prospective
purchasers, to say nothing of the fact that the words
"Carp" and "Bangos" both indicate fish, and the
additional fact that both trademarks and labels refer or
advertise the same product, namely, soy sauce.
Why the respondent in the present case could not have
selected as the principal figure in her label some
animal living in the surface of the earth, like a dog, cat,
monkey, etc., or an article or furniture, like a table,
chair, or if she was determined to select a creature
living in the sea, that of a crab, lobster, or octopus, is
hard to understand. She had to select fish, which as
already stated, she pictured in her label similar in size,
shape and form as that appearing in the already used
and registered label of petitioner. The Director of
Patents should as much as possible discourage all
attempts at imitation of labels already used and
registered, as already stated, to avoid confusion, to
protect the public from purchasing the wrong article or
brand and also to give protection to those who have
established goodwill, reputation and name in the
manufacture and the sale of their products by means of
a label of long standing and use and duly registered.
Another circumstance against the registration of the
trademark or label of respondent is that she would
appear not to have used the amended or modified label
she presented for registration, but continued to use the
original label or trademark which was refused
registration by the Director of Patents. This indicates
not only her desire to continue taking advantage of the
goodwill acquired and established by the petitioner, but

it equally shows that she had not used the label or


trademark now being applied for by her, despite the
fact that the law requires at least two months previous
use prior to application for registration.

Phil. Refining Co. vs Ng Sam (G.R. No. L-26676,


July 30, 1982)
HELD:The particular goods of the parties are so
unrelated that consumers would not in any probability
mistake one as the source or origin of the product of
the other. "Ham" is not a daily food fare for the average
consumer. One purchasing ham would exercise a more
cautious inspection of what he buys on account of it
price. Seldom, if ever, is the purchase of said food
product delegated to household helps, except perhaps
to those who, like the cooks, are expected to know their
business. Besides, there can be no likelihood for the
consumer of respondent's ham to confuse its source as
anyone but respondent. The facsimile of the label
attached by him on his product, his business name
"SAM'S HAM AND BACON FACTORY" written in bold
white letters against a reddish orange background 6, is
certain to catch the eye of the class of consumers to
which he caters. In addition, the goods of petitioners
are basically derived from vegetable oil and animal
fats, while the product of respondent is processed from
pig's legs. A consumer would not reasonably assume
that, petitioner has so diversified its business as to
include the product of respondent.
The Court, after noting that the same CAMIA trademark
had been registered by two other companies,
Everbright Development Company and F. E. Zuellig,
Inc. for their respective products of thread and yarn (for
the former) and textiles, embroideries and laces (for the
latter) ruled that "while ham and some of the products
of petitioner are classified under Class 47 (Foods and
Ingredients of Food), this alone cannot serve as the
decisive factor in the resolution of whether or not they
are related goods. Emphasis should be on the similarity
of the products involved and not on the arbitrary
classification or general description of their properties
or characteristics." The Court, therefore, concluded that
"In fine, We hold that the businesses of the parties are
non-competitive and their products so unrelated that
the use of Identical trademarks is not likely to give rise
to confusion, much less cause damage to petitioner." In
fine, We hold that the businesss of the parties are noncompetitive and their products so unrelated that the
use of Identical trademarks is not likely to give rise to
confusion, much less cause damage to petitioner.

ESSO Standard Easter Inc. vs. CA


FACTS: Petitioner Esso Standard Eastern, Inc.,

then a foreign corporation duly licensed to do


business in the Philippines, is engaged in the sale
of petroleum products which are Identified with its
trademark ESSO (which as successor of the
defunct Standard Vacuum Oil Co. it registered as
a business name with the Bureaus of Commerce
and Internal Revenue. Private respondent in turn
is a domestic corporation then engaged in the
manufacture and sale of cigarettes, after it
acquired in November, 1963 the business, factory
and patent rights of its predecessor La Oriental
Tobacco Corporation, one of the rights thus
acquired having been the use of the trademark
ESSO on its cigarettes, for which a permit had
been duly granted by the Bureau of Internal
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Revenue.
Barely had respondent as such successor started
manufacturing cigarettes with the trademark
ESSO, when petitioner commenced a case for
trademark infringement in the Court of First
Instance of Manila. The complaint alleged that the
petitioner had been for many years engaged in
the sale of petroleum products and its trademark
ESSO had acquired a considerable goodwill to
such an extent that the buying public had always
taken the trademark ESSO as equivalent to high
quality petroleum products. Petitioner asserted
that the continued use by private respondent of
the same trademark ESSO on its cigarettes was
being carried out for the purpose of deceiving the
public as to its quality and origin to the detriment
and disadvantage of its own products.
The trial court decided in favor of petitioner and
ruled that respondent was guilty of infringement of
trademark. On appeal, respondent CA found that
there was no trademark infringement and
dismissed the complaint. Reconsideration of the
decision having been denied, petitioner appealed
to this Court by way of certiorari to reverse the
decision of the CA and to reinstate the decision of
the CFI.
HELD: It is undisputed that the goods on which
petitioner uses the trademark ESSO, petroleum
products, and the product of respondent,
cigarettes, are non-competing. But as to whether
trademark infringement exists depends for the
most part upon whether or not the goods are so
related that the public may be, or is actually,
deceived and misled that they came from the
same maker or manufacturer. For non-competing
goods may be those which, though they are not in
actual competition, are so related to each other
that it might reasonably be assumed that they
originate from one manufacturer. Non-competing
goods may also be those which, being entirely
unrelated, could not reasonably be assumed to
have a common source. in the former case of
related goods, confusion of business could arise
out of the use of similar marks; in the latter case
of non- related goods, it could not. 8 The vast
majority of courts today follow the modern theory
or concept of "related goods" 9 which the Court
has likewise adopted and uniformly recognized
and applied.
Goods are related when they belong to the same
class or have the same descriptive properties;
when they possess the same physical attributes
or essential characteristics with reference to their
form, composition, texture or quality. They may
also be related because they serve the same
purpose or are sold in grocery stores. 11 Thus,
biscuits were held related to milk because they
are both food products. 12 Soap and perfume,
lipstick and nail polish are similarly related
because they are common household items now
a days. The trademark "Ang Tibay" for shoes and
slippers was disallowed to be used for shirts and
pants because they belong to the same general
class of goods. Soap and pomade although noncompetitive, were held to be similar or to belong
to the same class, since both are toilet articles.

But no confusion or deception can possibly result


or arise when the name "Wellington" which is the
trademark for shirts, pants, drawers and other
articles of wear for men, women and children is
used as a name of a department store.
The goods are obviously different from each other
with "absolutely no iota of similitude" as stressed
in respondent court's judgment. They are so
foreign to each other as to make it unlikely that
purchasers would think that petitioner is the
manufacturer of respondent's goods. The mere
fact that one person has adopted and used a
trademark on his goods does not prevent the
adoption and use of the same trademark by
others on unrelated articles of a different kind.
Although petitioner's products are numerous, they
are of the same class or line of merchandise
which are non-competing with respondent's
product of cigarettes, which as pointed out in the
appealed judgment is beyond petitioner's "zone of
potential or natural and logical expansion" When
a trademark is used by a party for a product in
which the other party does not deal, the use of
the same trademark on the latter's product cannot
be validly objected to.
Another factor that shows that the goods
involved are non-competitive and non-related
is the appellate court's finding that they flow
through different channels of trade, thus: "The
products of each party move along and are
disposed through different channels of
distribution. The (petitioner's) products are
distributed principally through gasoline
service and lubrication stations, automotive
shops and hardware stores. On the other
hand, the (respondent's) cigarettes are sold in
sari- sari stores, grocery stores, and other
small distributor outlets. (Respondent's)
cigarettes are even peddled in the streets
while (petitioner's) 'gasul' burners are not.
Finally, there is a marked distinction between
oil and tobacco, as well as between petroleum
and cigarettes. Evidently, in kind and nature
the products of (respondent) and of
(petitioner) are poles apart."

SEE CANON KABUSHIKI KAISHA vs. CA


Undoubtedly, the paints, chemical products, toner and
dyestuff of petitioner that carry the trademark CANON are
unrelated to sandals, the product of private respondent.
We agree with the BPTTT, following the Esso doctrine,
when it noted that the two classes of products in this case
flow through different trade channels. The products of
petitioner are sold through special chemical stores or
distributors while the products of private respondent are
sold in grocery stores, sari-sari stores and department
stores. Thus, the evident disparity of the products of the
parties in the case at bar renders unfounded the
apprehension of petitioner that confusion of business or
origin might occur if private respondent is allowed to use
the mark CANON.

Confusingly Similar Marks

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CASES:
American Wire Cable Co. vs. Director of Patents (G.R.
No. L-2655, Fe. 18, 1970)
FACTS: On 2 June 1962, Central Banahaw Industries, Inc.,
applied with the Director of Patents for registration of the
trademark DYNAFLEX and Device to be used in
connection with electric wires, class 20, which mark
applicant allegedly had been using since 29 March 1962.
The American Wire and Cable Co., Inc., another domestic
corporation and authorized user since 10 April 1958 of the
registered
trade
mark
DURAFLEX
and
Globe
representation, for electric wires, apparatus, machines and
supplies, class 20, opposed the application on the ground
that applicant's use of the trade mark DYNAFLEX would
cause confusion or result in mistake to purchasers
intending to buy DURAFLEX electric wires and goods, the
mark being registered allegedly having practically the same
spelling, pronunciation and sound, and covering the same
good, as that of the opposer. Besides, opposer contended
that there has been no continuous use in commerce of the
applicant's mark.
After due hearing, the Director of Patents rendered
decision holding the applicant's mark DYNAFLEX not to be
similar to the previously registered trademark DURAFLEX.
Consequently, the application of Central Banahaw
Industries for registration of DYNAFLEX was given due
course and the opposition thereto by American Wire &
Cable Company dismissed. The latter interposed the
present appeal.
ISSUE: Whether or not the mark DYNAFLEX and Device
is registrable as label for electric wires, class 20,
considering that the trademark DURAFLEX and Globe
representation also for electric wires, machines and
supplies under class 20, has been registered more than 4
years earlier.
HELD: The pertinent law, Republic Act 166, as amended,
on registrability of trademarks, prescribes:
SEC. 4. The owner of a trademark, trade name or
service-mark used to distinguish his goods, business or
services from the goods, business or services of others
shall have the right to register the same, unless it:
xxx xxx xxx
(d) Consists of or comprises a mark or trade name which
so resembles a mark or trade-name registered in the
Philippines by another and not abandoned, as to be likely,
when applied to or used in connection with the goods,
business or services of the applicant, to cause confusion or
mistake or to deceive purchasers. (Emphasis supplied)
It is clear from the above-quoted provision that the
determinative factor in a contest involving registration of
trade mark is not whether the challenged mark would
actually cause confusion or deception of the purchasers
but whether the use of such mark would likely cause
confusion or mistake on the part of the buying public. In
short, to constitute an infringement of an existing
trademark patent and warrant a denial of an application for
registration, the law does not require that the competing
trademarks must be so identical as to produce actual error
or mistake; it would be sufficient, for purposes of the law,
that the similarity between the two labels is such that there
is a possibility or likelihood of the purchaser of the older
brand mistaking the newer brand for it.

The question is, when is a trademark likely to confuse or


cause the public to mistake one for another? Earlier rulings
of the Court seem to indicate its reliance on the dominancy
test or the assessment of the essential or dominant
features in the competing labels to determine whether they
are confusingly similar. On this matter, the Court said:
It has been consistently held that the question of
infringement of a trademark is to be determined by the test
of dominancy. Similarity in size, form, and color, while
relevant, is not conclusive. If the competing trademark
contains the main or essential or dominant features of
another, and confusion and deception is likely to result,
infringement takes place. Duplication or imitation is not
necessary, nor is it necessary that the infringing label
should suggest an effort to imitate . The question at issue
in cases of infringement of trademarks is whether the use
of the marks involved would be likely to cause confusion or
mistakes in the mind of the public or deceive purchasers."
In fact, even their similarity in sound is taken into
consideration, where the marks refer to merchandise of the
same descriptive properties, for the reason that trade idem
sonans constitutes a violation of trade mark patents.
The present case is governed by the principles laid down in
the preceding cases. The similarity between the competing
trademarks, DURAFLEX and DYNAFLEX, is apparent. Not
only are the initial letters and the last half of the
appellations identical, but the difference exists only in two
out of the eight literal elements of the designations.
Coupled with the fact that both marks cover insulated
flexible wires under class 20; that both products are
contained in boxes of the same material, color, shape and
size; that the dominant elements of the front designs are a
red circle and a diagonal zigzag commonly related to a
spark or flash of electricity; that the back of both boxes
show similar circles of broken lines with arrows at the
center pointing outward, with the identical legend "Cut Out
Ring" "Draw From Inside Circle", no difficulty is
experienced in reaching the conclusion that there is a
deceptive similarity that would lead the purchaser to
confuse one product with the other.
The decision appealed from is hereby set aside, and the
application for registration of the trademark DYNAFLEX for
electric wires, class 20, is ordered denied.
SEE: AMERICAN CYANAMID CASE:
The similarity must be such as is likely to mislead
purchasers of ordinary caution and prudence into the belief
that the articles are those of another producer or
manufacturer. Whther the mark or label of one competitor
resembles....
Confusing similarity or the likelihood of confusion stems
form colorable imitation. The phrase "colorable imitation "
denotes such a "close or ingenious imitation as to be
calculated to deceive ordinary persons, or such a
resemblance to the original as to deceive an ordinary
purchaser, giving sucg attention as a purchaser usually
gives, and to cause him to purchase the one supposing it
to be the other.

Etepha vs. Director of Patents (G.R. No. L-20635,


march 31, 1966)

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FACTS: On April 23, 1959, respondent Westmont


Pharmaceuticals, Inc., a New York corporation, sought
registration of trademark "Atussin" placed on its "medicinal
preparation of expectorant antihistaminic, bronchodilator
sedative, ascorbic acid (Vitamin C) used in the treatment of
cough". The trademark is used exclusively in the
Philippines since January 21, 1959.

FACTS:

Petitioner, Etepha, A. G., a Liechtenstin (principality)


corporation, objected. Petitioner claims that it will be
damaged because Atussin is so confusedly similar to its
Pertussin (Registration No. 6089, issued on September 25,
1957) used on a preparation for the treatment of coughs,
that the buying public will be misled into believing that
Westmont's product is that of petitioner's which allegedly
enjoys goodwill.

ISSUE: May trademark ATUSSIN be registered, given the


fact that PERTUSSIN, another trademark, had been
previously registered in the Patent Office?
HELD: Yes because there is no likelihood of confusion.
A practical approach to the problem of similarity or
dissimilarity is to go into the whole of the two trademarks
pictured in their manner of display. Inspection should be
undertaken from the viewpoint of a prospective buyer. The
trademark complained of should be compared and
contrasted with the purchaser's memory (not in
juxtaposition) of the trademark said to be infringed. 10
Some such factors as "sound; appearance; form, style,
shape, size or format; color; ideas connoted by marks; the
meaning, spelling, and pronunciation, of words used; and
the setting in which the words appear" may be considered.
For, indeed, trademark infringement is a form of unfair
competition.
The two labels are entirely different in colors, contents,
arrangement of words thereon, sizes, shapes and general
appearance. The contrasts in pictorial effects and appeals
to the eye is so pronounced that the label of one cannot be
mistaken for that of the other, not even by persons
unfamiliar with the two trademarks.
On this point the following culled from a recent decision of
the United States Court of Customs and Patent Appeals
(June 15, 1956) is persuasive:
Confusion is likely between trademarks, however, only if
their over-all presentations in any of the particulars of
sound, appearance, or meaning are such as would lead
the purchasing public into believing that the products to
which the marks are applied emanated from the same
source. In testing this issue, fixed legal rules exist if not
in harmony, certainly in abundance but, in the final
analysis, the application of these rules in any given
situation necessarily reflects a matter of individual
judgment largely predicated on opinion. There is, however,
and can be no disagreement with the rule that the
purchaser is confused, if at all, by the marks as a whole.
For the reasons given, the appealed decision of the
respondent Director of Patents giving due course to the
application for the registration of trademark ATTUSIN is
hereby affirmed
Rueda Hermanos vs. pangilinan (G.R. No. 10738, jan.
14, 1916)

ISSUE:
HELD:

Ordinary Purchasers

NOTES:
Who will be confused? THE ORDINARY PURCHASER!
There are two kinds of purchsers, namely, the casual
purchaser and the careful purchaser. Although the IPC
does not define who are the purchasers likely to be
confused, such purchasers have been referred to as
the ordinary average purchasers, and not the experts,
the dealers, or other persons esp. familiar with the
trademark or goods involved.
The test....
CASES:
Fruit of the Loom vs. CA (G.R. No. L-32747, nov. 29,
1984)
FACTS: Petitioner, a corporation duly organized and
existing under the laws of the State of Rhode Island, United
States of America, is the registrant of a trademark, FRUIT
OF THE LOOM, in the Philippines Patent Office and was
issued two Certificates of Registration Nos. 6227 and
6680. The classes of merchandise covered by Registration
Certificate No. 6227 are, among others, men's, women's
and children's underwear, which includes women's panties
and which fall under class 40 in the Philippine Patent
Office's classification of goods. Registration Certificate No.
6680 covers knitted, netted and textile fabrics.
Private respondent, a domestic corporation, is the
registrant of a trademark FRUIT FOR EVE in the Philippine
Patent Office and was issued a Certificate of Registration
No. 10160, on January 10, 1963 covering garments similar
to petitioner's products like women's panties and pajamas.
Petitioner filed before the lower court, a complaint for
infringement of trademark and unfair competition against
the herein private respondent. Petitioner principally alleged
in the complaint that private respondent's trademark FRUIT
FOR EVE is confusingly similar to its trademark FRUIT OF
THE LOOM used also on women's panties and other textile
products. Furthermore, it was also alleged therein that the
color get-up and general appearance of private
respondent's hang tag consisting of a big red apple is a
colorable imitation to the hang tag of petitioner. The trial
court ruled in favor of Fruit of the Loom. General Garments
appealed. The appellate court reversed the trial courts
decision. Hence, the petition for review on certiorari.
ISSUE: Whether or not private respondent's trademark
FRUIT FOR EVE and its hang tag are confusingly similar to
petitioner's trademark FRUIT OF THE LOOM and its hang
tag so as to constitute an infringement of the latter's
trademark rights and justify the cancellation of the former.

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HELD: In cases involving infringement of trademark


brought before this Court it has been consistently held that
there is infringement of trademark when the use of the
mark involved would be likely to cause confusion or
mistake in the mind of the public or to deceive purchasers
as to the origin or source of the commodity.
In the trademarks FRUIT OF THE LOOM and FRUIT FOR
EVE, the lone similar word is FRUIT. WE agree with the
respondent court that by mere pronouncing the two marks,
it could hardly be said that it will provoke a confusion, as to
mistake one for the other. Standing by itself, FRUIT OF
THE LOOM is wholly different from FRUIT FOR EVE. WE
do not agree with petitioner that the dominant feature of
both trademarks is the word FRUIT for even in the printing
of the trademark in both hang tags, the word FRUIT is not
at all made dominant over the other words. As to the
design and coloring scheme of the hang tags, We believe
that while there are similarities in the two marks like the red
apple at the center of each mark, We also find differences
or dissimilarities which are glaring and striking to the eye
such as:
1. The shape of petitioner's hang tag is round with
a base that looks like a paper rolled a few inches in both
ends; while that of private respondent is plain rectangle
without any base.
2. The designs differ. Petitioner's trademark is
written in almost semi-circle while that of private
respondent is written in straight line in bigger letters than
petitioner's. Private respondent's tag has only an apple in
its center but that of petitioner has also clusters of grapes
that surround the apple in the center.
3. The colors of the hang tag are also very distinct
from each other. Petitioner's hang tag is fight brown while
that of respondent is pink with a white colored center piece.
The apples which are the only similarities in the hang tag
are differently colored. Petitioner's apple is colored dark
red, while that of private respondent is light red.
The similarities of the competing trademarks in this case
are completely lost in the substantial differences in the
design and general appearance of their respective hang
tags. WE have examined the two trademarks as they
appear in the hang tags submitted by the parties and We
are impressed more by the dissimilarities than by the
similarities appearing therein. WE hold that the
trademarks FRUIT OF THE LOOM and FRUIT FOR EVE
do not resemble each other as to confuse or deceive
an ordinary purchaser. The ordinary purchaser must
be thought of as having, and credited with, at least a
modicum of intelligence to be able to see the obvious
differences between the two trademarks in question.
Furthermore, We believe that a person who buys
petitioner's products and starts to have a liking for it,
will not get confused and reach out for private
respondent's products when she goes to a garment
store.

Converse Rubber vs. Universal Rubber, supra


HELD: Another factor why respondent's applications
should be denied is the confusing similarity between its
trademark "UNIVERSAL CONVERSE AND DEVICE" and

petitioner's corporate name and/or its trademarks "CHUCK


TAYLOR" and "ALL STAR DEVICE" which could confuse
the purchasing public to the prejudice of petitioner.
The trademark of respondent "UNIVERSAL CONVERSE
and DEVICE" is imprinted in a circular manner on the side
of its rubber shoes. In the same manner, the trademark of
petitioner which reads "CONVERSE CHUCK TAYLOR" is
imprinted on a circular base attached to the side of its
rubber shoes. The deteminative factor in ascertaining
whether or not marks are confusingly similar to each other
"is not whether the challenged mark would actually cause
confusion or deception of the purchasers but whether the
use of such mark would likely cause confusion or mistake
on the part of the buying public. It would be sufficient, for
purposes of the law, that the similarity between the two
labels is such that there is a possibility or likelihood of the
purchaser of the older brand mistaking the new brand for
it." Even if not an the details just mentioned were identical,
with the general appearance alone of the two products, any
ordinary, or even perhaps even [sic] a not too perceptive
and discriminating customer could be deceived ... "
When the law speaks co-purchaser," the reference is to
ordinary average purchaser. It is not necessary in
either case that the resemblance be sufficient to
deceive experts, dealers, or other persons specially
familiar with the trademark or goods involve."
The similarity in the general appearance of respondent's
trademark and that of petitioner would evidently create a
likelihood of confusion among the purchasing public. But
even assuming, arguendo, that the trademark sought to be
registered by respondent is distinctively dissimilar from
those of the petitioner, the likelihood of confusion would still
subsists, not on the purchaser's perception of the goods
but on the origins thereof. By appropriating the word
"CONVERSE," respondent's products are likely to be
mistaken as having been produced by petitioner. "The risk
of damage is not limited to a possible confusion of goods
but also includes confusion of reputation if the public could
reasonably assume that the goods of the parties originated
from the same source.
Ethepa vs. Director of Patents (G.R. No. L-20635, Mar.
31 1966)
ISSUE: May trademark ATUSSIN be registered, given the
fact that PERTUSSIN, another trademark, had been
previously registered in the Patent Office?
HELD: Yes because there is no likelihood of confusion.
In the solution of a trademark infringement problem, regard
too should be given to the class of persons who buy the
particular product and the circumstances ordinarily
attendant to its acquisition. The medicinal preparation
clothed with the trademarks in question, are unlike articles
of everyday use such as candies, ice cream, milk, soft
drinks and the like which may be freely obtained by
anyone, anytime, anywhere. Petitioner's and respondent's
products are to be dispensed upon medical prescription.
The respective labels say so. An intending buyer must
have to go first to a licensed doctor of medicine; he
receives instructions as to what to purchase; he reads the
doctor's prescription; he knows what he is to buy. He is not
of the incautious, unwary, unobservant or unsuspecting
type; he examines the product sold to him; he checks to

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find out whether it conforms to the medical prescription.


The common trade channel is the pharmacy or the
drugstore. Similarly, the pharmacist or druggist verifies the
medicine sold. The margin of error in the acquisition of one
for the other is quite remote.
For the reasons given, the appealed decision of the
respondent Director of Patents giving due course to the
application for the registration of trademark ATTUSIN is
hereby affirmed

Lim Hoa vs. Director of Patents (G.R. No. L-8072, Oct.


31, 1956)
ASIA BREWERY, INC.vs. COURT OF APPEALS
G.R. No. 103543 July 5, 1993
FACTS: San Miguel Corporation (SMC) filed a
complaint against Asia Brewery Inc. (ABI) for
infringement of trademark and unfair competition on
account of the latter's BEER PALE PILSEN or BEER
NA BEER product which has been competing with
SMC's SAN MIGUEL PALE PILSEN for a share of the
local beer market.
The registered trademark of SMC for its pale pilsen
beer is:
San Miguel Pale Pilsen With Rectangular Hops and
Malt Design. The dominant feature is the phrase "San
Miguel" written horizontally at the upper portion.
On the other hand, ABI's trademark is consist of:
. . . a rectangular design bordered by what appear to
be buds of flowers with leaves. The dominant feature is
"Beer" written across the upper portion of the
rectangular design. The phrase "Pale Pilsen" appears
immediately below in smaller block letters.
A decision was rendered by the trial Court dismissing
SMC's complaint because ABI has not committed
trademark infringement or unfair competition against.
SMC appealed to the Court of Appeals which reversed
the decision of the trial court. ABI appealed to the
Supreme Court by a petition for certiorari.
ISSUE: Whether or not ABI's BEER PALE PILSEN
label or "design" infringes upon SMC's SAN MIGUEL
PALE PILSEN WITH RECTANGULAR MALT AND
HOPS DESIGN and thereby commits unfair
competition against the latter.
HELD: No. Infringement is determined by the "test of
dominancy" rather than by differences or variations in
the details of one trademark and of another. If the
competing trademark contains the main or essential or
dominant features of another, and confusion and
deception is likely to result, infringement takes place.
Duplication or imitation is not necessary; nor it is
necessary that the infringing label should suggest an
effort to imitate. The question at issue in cases of
infringement of trademarks is whether the use of the
marks involved would be likely to cause confusion or
mistakes in the mind of the public or deceive
purchasers.
There is hardly any dispute that the dominant feature of
SMC's trademark is the name of the product: SAN
MIGUEL PALE PILSEN, written in white Gothic letters
with elaborate serifs at the beginning and end of the
letters "S" and "M" on an amber background across the
upper portion of the rectangular design. On the other
hand, the dominant feature of ABI's trademark is the
name: BEER PALE PILSEN, with the word "Beer"
written in large amber letters, larger than any of the
letters found in the SMC label.
The trial court

perceptively observed that the word "BEER" does not


appear in SMC's trademark, just as the words "SAN
MIGUEL" do not appear in ABI's trademark. Hence,
there is absolutely no similarity in the dominant
features of both trademarks.
The fact that the words pale pilsen are part of ABI's
trademark does not constitute an infringement of
SMC's trademark: SAN MIGUEL PALE PILSEN, for
"pale pilsen" are generic words descriptive of the color
("pale"), of a type of beer ("pilsen"), which is a light
bohemian beer with a strong hops flavor that originated
in the City of Pilsen in Czechoslovakia and became
famous in the Middle Ages. "Pilsen" is a "primarily
geographically descriptive word," hence, nonregisterable and not appropriable by any beer
manufacturer. The words "pale pilsen" may not be
appropriated by SMC for its exclusive use even if they
are part of its registered trademark: SAN MIGUEL
PALE PILSEN, any more than such descriptive words
as "evaporated milk," "tomato ketchup," "cheddar
cheese," "corn flakes" and "cooking oil" may be
appropriated by any single manufacturer of these food
products, for no other reason than that he was the first
to use them in his registered trademark.
The circumstance that the manufacturer of BEER PALE
PILSEN, Asia Brewery Incorporated, has printed its
name all over the bottle of its beer product: on the
label, on the back of the bottle, as well as on the bottle
cap, disproves SMC's charge that ABI dishonestly and
fraudulently intends to palm off its BEER PALE PILSEN
as SMC's product. In view of the visible differences
between the two products, the Court believes it is quite
unlikely that a customer of average intelligence would
mistake a bottle of BEER PALE PILSEN for SAN
MIGUEL PALE PILSEN.
The fact that BEER PALE PILSEN like SAN MIGUEL
PALE PILSEN is bottled in amber-colored steinie
bottles of 320 ml. capacity and is also advertised in
print, broadcast, and television media, does not
necessarily constitute unfair competition.
Unfair competition is the employment of deception or
any other means contrary to good faith by which a
person shall pass off the goods manufactured by him or
in which he deals, or his business, or services, for
those of another who has already established goodwill
for his similar goods, business or services, or any acts
calculated to produce the same result.
The use of ABI of the steinie bottle, similar but not
identical to the SAN MIGUEL PALE PILSEN bottle, is
not unlawful. As pointed out by ABI's counsel, SMC did
not invent but merely borrowed the steinie bottle from
abroad and it claims neither patent nor trademark
protection for that bottle shape and design. The
petitioner's contention that bottle size, shape and color
may not be the exclusive property of any one beer
manufacturer is well taken. SMC's being the first to use
the steinie bottle does not give SMC a vested right to
use it to the exclusion of everyone else. Being of
functional or common use, and not the exclusive
invention of any one, it is available to all who might
need to use it within the industry. With regard to the
white label of both beer bottles, ABI explained that it
used the color white for its label because white
presents the strongest contrast to the amber color of
ABI's bottle; it is also the most economical to use on
labels, and the easiest to "bake" in the furnace. No one
can have a monopoly of the color amber for bottles, nor
of white for labels, nor of the rectangular shape which
is the usual configuration of labels. Needless to say, the
shape of the bottle and of the label is unimportant.
What is all important is the name of the product written
on the label of the bottle for that is how one beer may

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scrutiny nor does he usually have the time to do so. The


average shopper is usually in a hurry and does not inspect
every product on the shelf as if he were browsing in a
library.

be distinguished from the others.


The finding the petition for review meritorious, the
same is hereby granted. The decision and resolution of
the Court of Appeals are hereby set aside and that of
the trial court is REINSTATED and AFFIRMED.

Del Monte Corp. vs. CA (181 SCRA 410 (1990)


FACTS: Petitioner Del Monte Corporation is a foreign
company organized under the laws of the United States
and not engaged in business in the Philippines. Both the
Philippines and the United States are signatories to the
Convention of Paris of September 27, 1965, which grants
to the nationals of the parties rights and advantages which
their own nationals enjoy for the repression of acts of
infringement and unfair competition.
Petitioner Philippine Packing Corporation (Philpack) is a
domestic corporation duly organized under the laws of the
Philippines. On April 11, 1969, Del Monte granted Philpack
the right to manufacture, distribute and sell in the
Philippines various agricultural products, including catsup,
under the Del Monte trademark and logo. Del Monte
authorized Philpack to register with the Philippine Patent
Office the Del Monte catsup bottle configuration, for which
it was granted Certificate of Trademark Registration No.
SR-913 by the Philippine Patent Office under the
Supplemental Register. Del Monte also obtained two
registration certificates for its trademark "DEL MONTE" and
its logo. Respondent Sunshine Sauce Manufacturing
Industries was issued a Certificate of Registration by the
Bureau of Domestic Trade to engage in the manufacture,
packing, distribution and sale of various kinds of sauce,
identified by the logo Sunshine Fruit Catsup. This logo was
registered in the Supplemental Register on September 20,
1983. The product itself was contained in various kinds of
bottles, including the Del Monte bottle, which the private
respondent bought from the junk shops for recycling.
Having received reports that the private respondent was
using its exclusively designed bottles and a logo
confusingly similar to Del Monte's, Philpack warned it to
desist from doing so on pain of legal action. Thereafter,
claiming that the demand had been ignored, Philpack and
Del Monte filed a complaint against the private respondent
for infringement of trademark and unfair competition, with a
prayer for damages and the issuance of a writ of
preliminary injunction.
RTC dismissed the complaint. It held that there were
substantial differences between the logos or trademarks of
the parties; that the defendant had ceased using the
petitioners' bottles; and that in any case the defendant
became the owner of the said bottles upon its purchase
thereof from the junk yards. Furthermore, the complainants
had failed to establish the defendant's malice or bad faith,
which was an essential element of infringement of
trademark or unfair competition. This decision was affirmed
in toto by the respondent court, which is now faulted in this
petition for certiorari under Rule 45 of the Rules of Court.
HELD: It has been correctly held that side-by-side
comparison is not the final test of similarity. Such
comparison requires a careful scrutiny to determine in what
points the labels of the products differ, as was done by the
trial judge. The ordinary buyer does not usually make such

SC also note that the respondent court failed to take into


consideration several factors which should have affected
its conclusion, to wit: age, training and education of the
usual purchaser, the nature and cost of the article, whether
the article is bought for immediate consumption and also
the conditions under which it is usually purchased. Among
these, what essentially determines the attitude of the
purchaser, specifically his inclination to be cautious, is the
cost of the goods. To be sure, a person who buys a box of
candies will not exercise as much care as one who buys an
expensive watch. As a general rule, an ordinary buyer does
not exercise as much prudence in buying an article for
which he pays a few centavos as he does in purchasing a
more valuable thing. 22 Expensive and valuable items are
normally bought only after deliberate, comparative and
analytical investigation. But mass products, low priced
articles in wide use, and matters of everyday purchase
requiring frequent replacement are bought by the casual
consumer without great care. In this latter category is
catsup.
At that, even if the labels were analyzed together it is not
difficult to see that the Sunshine label is a colorable
imitation of the Del Monte trademark. The predominant
colors used in the Del Monte label are green and redorange, the same with Sunshine. The word "catsup" in both
bottles is printed in white and the style of the print/letter is
the same. Although the logo of Sunshine is not a tomato,
the figure nevertheless approximates that of a tomato.
As previously stated, the person who infringes a trade mark
does not normally copy out but only makes colorable
changes, employing enough points of similarity to confuse
the public with enough points of differences to confuse the
courts. What is undeniable is the fact that when a
manufacturer prepares to package his product, he has
before him a boundless choice of words, phrases, colors
and symbols sufficient to distinguish his product from the
others. When as in this case, Sunshine chose, without a
reasonable explanation, to use the same colors and letters
as those used by Del Monte though the field of its selection
was so broad, the inevitable conclusion is that it was done
deliberately to deceive. It has been aptly observed that the
ultimate ratio in cases of grave doubt is the rule that as
between a newcomer who by the confusion has nothing to
lose and everything to gain and one who by honest dealing
has already achieved favor with the public, any doubt
should be resolved against the newcomer inasmuch as the
field from which he can select a desirable trademark to
indicate the origin of his product is obviously a large one.

Confusion of Goods vs. Confusion of Business

NOTES:

TWO TYPES OF CONFUSION:


1. CONFUSION OF GOODS
2. CONFUSION OF BUSINESS OR ORIGIN
The first is the confusion of goods"in which event the

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ordinarily prudent purchaser would be induced to


purchase one product in the belief (Sterling products
case)
There is confusion of goods when the products are
competing, confusion of business exists when the products
are non-competing but related enough to produce confusion
of affiliation.
Sterling Products International, Inc. v.
Farbenfabriken Bayer Aktiengesellschaft (G.R. No.
L-19906, April 30, 1969)
See the Facts from the previous discussion.

HELD: A question basic in the field of trademarks and


unfair competition is the extent to which a registrant of
a trademark covering one product may invoke the right
to protection against the use by other(s) of the same
trademark to identify merchandise different from those
for which the trademark has been appropriated.

respondent corporation, of its exclusive right to the "Big


Mac" mark and requested him to desist from using the "Big
Mac" mark or any similar mark. Having received no reply
from respondent Dy, petitioners sued respondents in the
RTC for trademark infringement and unfair competition.
RTC rendered judgment finding respondent corporation
liable for trademark infringement and unfair competition.
However, the RTC dismissed the complaint against private
respondents and the counterclaim against petitioners for
lack of merit and insufficiency of evidence. The CA
rendered judgment reversing the RTC Decision and
ordering McDonald's to pay respondents P1,600,000 as
actual and compensatory damages and P300,000 as moral
damages. Petitioners sought reconsideration of the CA's
Decision but the appellate court denied their motion in its
Resolution of 11 July 2000. Hence, this petition for review.
ISSUE: Whether respondents used the words "Big Mak"
not only as part of the corporate name "L.C. Big Mak
Burger, Inc." but also as a trademark for their hamburger
products

Plaintiff's trenchant claim is that it should not be turned


away because its case comes within the protection of
the confusion of origin rule. Callmann notes two types
of confusion. The first is the confusion of goods "in
which event the ordinarily prudent purchaser would be
induced to purchase one product in the belief that he
was purchasing the other." In which case, "defendant's
goods are then bought as the plaintiff's, and the poorer
quality of the former reflects adversely on the plaintiff's
reputation." The other is the confusion of business:
"Here though the goods of the parties are different, the
defendant's product is such as might reasonably be
assumed to originate with the plaintiff, and the public
would then be deceived either into that belief or into the
belief that there is some connection between the
plaintiff and defendant which, in fact, does not exist."

HELD: The petition has merit.


On Types of Confusion
Section 22 covers two types of confusion arising from the
use of similar or colorable imitation marks, namely,
confusion of goods (product confusion) and confusion of
business (source or origin confusion). In Sterling Products
International, Incorporated v. Farbenfabriken Bayer
Aktiengesellschaft, et al.,49 the Court distinguished these
two types of confusion, thus:

McDonald Corp vs. L.C. Big Mak (G.R. No. 143993, Aug.
18, 2004)
FACTS: Petitioner McDonald's Corporation ("McDonald's")
is a corporation organized under the laws of Delaware,
United States. McDonald's operates, by itself or through its
franchisees, a global chain of fast-food restaurants.
McDonald's4 owns a family of marks5 including the "Big
Mac" mark for its "double-decker hamburger sandwich."
McDonald's registered this trademark with the United
States Trademark Registry. Based on this Home
Registration, McDonald's applied for the registration of the
same mark in the Principal Register of the then Philippine
Bureau of Patents, Trademarks and Technology ("PBPTT"),
now the Intellectual Property Office ("IPO"). Pending
approval of its application, McDonald's introduced its "Big
Mac" hamburger sandwiches in the Philippine market in
September 1981. On the other hand, Respondent L.C. Big
Mak Burger, Inc. is a domestic corporation which operates
fast-food outlets and snack vans in Metro Manila and
nearby provinces. Respondent corporation's menu includes
hamburger sandwiches and other food items.
Respondent corporation applied with the PBPTT for the
registration of the "Big Mak" mark for its hamburger
sandwiches.
McDonald's
opposed
respondent
corporation's application on the ground that "Big Mak" was
a colorable imitation of its registered "Big Mac" mark for the
same food products. McDonald's also informed respondent
Francis Dy, the chairman of the Board of Directors of

[Rudolf] Callman notes two types of confusion. The first is


the confusion of goods "in which event the ordinarily
prudent purchaser would be induced to purchase one
product in the belief that he was purchasing the other." xxx
The other is the confusion of business: "Here though the
goods of the parties are different, the defendant's product
is such as might reasonably be assumed to originate with
the plaintiff, and the public would then be deceived either
into that belief or into the belief that there is some
connection between the plaintiff and defendant which, in
fact, does not exist."
Under Act No. 666,50 the first trademark law, infringement
was limited to confusion of goods only, when the infringing
mark is used on "goods of a similar kind." Thus, no relief
was afforded to the party whose registered mark or its
colorable imitation is used on different although related
goods. To remedy this situation, Congress enacted RA 166
on 20 June 1947. In defining trademark infringement,
Section 22 of RA 166 deleted the requirement in question
and expanded its scope to include such use of the mark or
its colorable imitation that is likely to result in confusion on
"the source or origin of such goods or services, or identity
of such business." Thus, while there is confusion of goods
when the products are competing, confusion of business
exists when the products are non-competing but related
enough to produce confusion of affiliation.
On Whether Confusion of Goods and Confusion of
Business are Applicable
Petitioners claim that respondents' use of the "Big Mak"

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mark on respondents' hamburgers results in confusion of


goods, particularly with respect to petitioners' hamburgers
labeled "Big Mac." Since respondents used the "Big Mak"
mark on the same goods, i.e. hamburger sandwiches, that
petitioners' "Big Mac" mark is used, trademark infringement
through confusion of goods is a proper issue in this case.
Petitioners also claim that respondents' use of the "Big
Mak" mark in the sale of hamburgers, the same business
that petitioners are engaged in, results in confusion of
business.
Respondents admit that their business includes selling
hamburger sandwiches, the same food product that
petitioners sell using the "Big Mac" mark. Thus, trademark
infringement through confusion of business is also a proper
issue in this case. Respondents assert that their "Big Mak"
hamburgers cater mainly to the low-income group while
petitioners' "Big Mac" hamburgers cater to the middle and
upper income groups. Even if this is true, the likelihood of
confusion of business remains, since the low-income group
might be led to believe that the "Big Mak" hamburgers are
the low-end hamburgers marketed by petitioners. After all,
petitioners have the exclusive right to use the "Big Mac"
mark. On the other hand, respondents would benefit by
associating their low-end hamburgers, through the use of
the "Big Mak" mark, with petitioners' high-end "Big Mac"
hamburgers, leading to likelihood of confusion in the
identity of business.
Respondents further claim that petitioners use the "Big
Mac" mark only on petitioners' double-decker hamburgers,
while respondents use the "Big Mak" mark on hamburgers
and other products like siopao, noodles and pizza.
Respondents also point out that petitioners sell their Big
Mac double-deckers in a styrofoam box with the
"McDonald's" logo and trademark in red, block letters at a
price more expensive than the hamburgers of respondents.
In contrast, respondents sell their Big Mak hamburgers in
plastic wrappers and plastic bags. Respondents further
point out that petitioners' restaurants are air- conditioned
buildings with drive-thru service, compared to respondents'
mobile vans.
These and other factors respondents cite cannot negate
the undisputed fact that respondents use their "Big Mak"
mark on hamburgers, the same food product that
petitioners' sell with the use of their registered mark "Big
Mac." Whether a hamburger is single, double or tripledecker, and whether wrapped in plastic or styrofoam, it
remains the same hamburger food product. Even
respondents' use of the "Big Mak" mark on non-hamburger
food products cannot excuse their infringement of
petitioners' registered mark, otherwise registered marks will
lose their protection under the law. The registered
trademark owner may use his mark on the same or similar
products, in different segments of the market, and at
different price levels depending on variations of the
products for specific segments of the market. The Court
has recognized that the registered trademark owner enjoys
protection in product and market areas that are the normal
potential expansion of his business. Thus, the Court has
declared:
Modern law recognizes that the protection to which the
owner of a trademark is entitled is not limited to guarding
his goods or business from actual market competition with
identical or similar products of the parties, but extends to
all cases in which the use by a junior appropriator of a
trade-mark or trade-name is likely to lead to a confusion of

source, as where prospective purchasers would be misled


into thinking that the complaining party has extended his
business into the field or is in any way connected with the
activities of the infringer; or when it forestalls the normal
potential expansion of his business.
THE GEORGE W. LUFT COMPANY INC. vs. NGO
GUAN and DIRECTOR OF PATENTS
FACTS: This is a petition for review of a decision and a
resolution of the Director of Patents. Petitioner, George
W. Luft Co., Inc. a foreign corporation organized
under the laws of the State of New York is the owner
of the trademark "Tangee", which it has allegedly used
since February 28, 1928, and is covered by Certificate
of Registration No. 2178-S of the Philippine Patent
Office.
On 1959, Ngo Guan applied for the registration of the
trademark "Tango", which he claims to have used since
June, 1958. Petitioner objected thereto alleging that
"Tango" is likely to be mistaken for "Tangee", upon the
ground that the two trademarks are confusingly similar.
After appropriate proceedings the Director of Patents
rendered a decision overruling said opposition and
granting Ngo Guan's application. A reconsideration of
this decision having been denied, petitioner brought the
matter before this Court for a review of said decision
and of the resolution denying a reconsideration thereof.
ISSUE: Whether or not the "Tango" trademark is
confusingly similar with the "Tangee" trademark, as
contended by petitioner herein, as to be likely to be
mistaken for the latter by the unsuspecting public.
HELD: To begin with, one of the factors essential
therefor is whether or not there is a general similarity in
the appearance of the trademarks in question, which
can not be determined with reasonable certainty
without a physical examination and comparison
thereof. Petitioner has rendered such examination
impossible, by not introducing any evidence
whatsoever as to the appearance of the "Tangee"
trademark. What is more, such omission suggests that
its appearance is not analogous to that of respondent's
"Tango", for, otherwise, petitioner would not have failed
to present a sample of its trademark, for comparison
with that of respondent Ngo Guan.
Moreover, the word "Tango" has a well established
meaning, for it describes a particular dance that is well
known in the Philippines. In fact, respondent's label
includes the picture of a man and a woman dancing.
Again, "Tango" is used by Ngo Guan for no other
product than hair pomade, in which petitioner does not
deal. Upon the other hand, petitioner's trademark is
used for specified chemicals, medical and
pharmaceutical preparations namely: "lipstick,
creme rouge, compact rouge, cleansing cream, day
cream, night cream, massage cream, face lotion,
astringent, face powder, powder compacts, cosmetics
for lashes, brows, and hair, hair pencils, nail polish,
perfumes, and toilet waters and it is not claimed that
Ngo Guan uses or intends to use its "Tango" trademark
on articles of this kind.
The decision and the
resolution appealed from are hereby affirmed

Actual Confusion

CASES:
McDonald Corp. vs. L.C. Big Mak (G.R. No. 143993,
Aug. 18, 2004)

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On the Lack of Proof of Actual Confusion

2. Holistic Test (READ THE CASES OF BRISTOL AND


MEAD)

Petitioners' failure to present proof of actual confusion


does not negate their claim of trademark infringement. As
noted in American Wire & Cable Co. v. Director of Patents,
Section 22 requires the less stringent standard of
"likelihood of confusion" only. While proof of actual
confusion is the best evidence of infringement, its
absence is inconsequential.
Acoje Mining Co. vs Director of Patents (G.R. No. L28744, April 29, 1971)
In the language of Justice J. B. L. Reyes, who spoke for
the Court in American Wire & Cable Co. v. Director of
Patents: "It is clear from the above-quoted provision that
the determinative factor in a contest involving registration
of trade mark is not whether the challenging mark would
actually cause confusion or deception of the purchasers
but whether the use of such mark would likely cause
confusion or mistake on the part of the buying public. In
short, to constitute an infringement of an existing
trade-mark patent and warrant a denial of an
application for registration, the law does not require
that the competing trademarks must be so identical as
to produce actual error or mistake; it would be
sufficient, for purposes of the law, that the similarity
between the two labels, is such that there is a
possibility or likelihood of the purchaser of the older
brand mistaking the newer brand for it."

Test of Confusing similarity

1. Phoenetic Similarity
Marvex Commercial Co. vs. Petra Haw Pia:
The registration of the trademark "Lionpas" for medicated
plaster was denied for being confusingly similar in sound
with "Salonpas", a registered mark also for medicated
plaster, the Court saying: Two letters of "SALONPAS" are
missing in "LIONPAS" the first letter a and the letters. Be
that as it may, when the two words are pronounced, the
sound effects are confusingly similar. And where goods are
advertised over the radio, similarity in sound is of especial
significance. "The importance of this rule is emphasized by
the increase of radio advertising in which we are deprived
of help of our eyes and must depend entirely on the ear.
The following random list of confusingly similar sounds in
the matter of trademarks, culled from Nims, Unfair
Competition and Trade Marks, 1947, Vol. 1, will reinforce
our view that "SALONPAS" and "LIONPAS" are confusingly
similar in sound: "Gold Dust" and "Gold Drop"; "Jantzen"
and "Jass-Sea"; "Silver Flash" and "Supper Flash";
"Cascarete" and "Celborite"; "Celluloid" and "Cellonite";
"Chartreuse" and "Charseurs"; "Cutex" and "Cuticlean";
"Hebe" and "Meje"; "Kotex" and "Femetex"; "Zuso" and
"Hoo Hoo". Leon Amdur, in his book "Trade- Mark Law and
Practice", pp. 419-421, cities, as coming within the purview
of the idem sonans rule, "Yusea" and "U- C-A", "Steinway
Pianos" and "Steinberg Pianos", and "Seven-Up" and
"Lemon-Up". In Co Tiong vs. Director of Patents, this Court
unequivocally said that "Celdura" and "Cordura" are
confusingly similar in sound; this Court held in Sapolin Co.
vs. Balmaceda, 67 Phil. 795 that the name "Lusolin" is an
infringement of the trademark "Sapolin", as the sound of
the two names is almost the same.

NOTES:
The holistic test mandates that the entirety of the
marks in question must be considered in determining
confusing similarity.
It requires the court to consider the entirety of the
marks as applied to the products, including the labels
and packaging, in determing confusing similarity.
In determining whether the trademarks are confusingly
similar, a comparison of the words is not the only
determinant factor. The trademarks in their entirety as they
appear in their respective labels or hang tags must also be
considered in relation to the goods to which they are
attached. The discerning eye of the observer must focus
not only on the predominant words but also on the other
features appearing in both labels in order that he may draw
his conclusion whether one is confusingly similar to the
other.
CASES:
BRISTOL MYERS COMPANY vs. THE DIRECTOR OF
PATENTS (17 SCRA 128 (1966)
FACTS: A petition for registration in the Principal
Register of the Patent Office of the trademark
"BIOFERIN" was filed on October 21, 1957 by United
American Pharmaceuticals, Inc. Said domestic
corporation first used the afore-stated trademark in the
Philippines on August 13, 1957. It covers "a medicinal
preparation of antihistamic, analgesic, antipyritic with
vitamin C and Bioflavenoid used in the treatment of
common colds, influenza and other febrile diseases
with capillary hemmorrhagic tendencies." The product
falls under Class 6 of the official classification, that is,
"Medicines and Pharmaceutical Preparations". Bristol
Myers Co., a corporation of the State of Delaware,
U.S.A., filed on January 6, 1959 an opposition to the
application. Said oppositor is the owner in the
Philippines of the trademark "BUFFERIN" under
Certificate of Registration No. 4578 issued by the
Philippine Patent Office on March 3, 1954. Its
trademark is also registered in the United States under
Certificate of Registration No. 566190 issued on
November 4, 1952. It was first used in the Philippines
on May 13, 1953. The product covered by "BUFFERIN"
also belongs to Class 6, Medicines and Pharmaceutical
Preparations. Designated as "Antacid analgesic", it is
intended for relief in cases of "simple headaches,
neuralgia, colds, menstrual pain and minor muscular
aches."
MEAD CASE:

3. Dominancy Test
NOTES:
The test of dominancy focuses on the similarity of the
prevalent features of the competing trademarks which
might cause confusion or deception and thus
constitutes infringement.

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. . . If the competing trademark contains the main or


essential or dominant features of another, and confusion
and deception is likely to result, infringement takes place.
Duplication or imitation is not necessary; nor it is necessary
that the infringing label should suggest an effort to imitate.
The question at issue in cases of infringement of
trademarks is whether the use of the marks involved would
be likely to cause confusion or mistakes in the mind of the
public or deceive purchasers.
The Court reiterated the dominancy test in Lim Hoa v.
Director of Patents,61 Phil. Nut Industry, Inc. v. Standard
Brands Inc., Converse Rubber Corporation v. Universal
Rubber Products, Inc.,63 and Asia Brewery, Inc. v. Court of
Appeals. In the 2001 case of Societe Des Produits Nestl,
S.A. v. Court of Appeals,65 the Court explicitly rejected the
holistic test in this wise:
[T]he totality or holistic test is contrary to the
elementary postulate of the law on trademarks and
unfair competition that confusing similarity is to be
determined on the basis of visual, aural, connotative
comparisons and overall impressions engendered by
the marks in controversy as they are encountered in
the realities of the marketplace. (Emphasis supplied)
The test of dominancy is now explicitly incorporated into
law in Section 155.1 of the Intellectual Property Code
which defines infringement as the "colorable imitation of a
registered mark xxx or a dominant feature thereof."

Generic & Descriptive Marks

CASES:

nevertheless involve an element of incongruity,


figurativeness, or imaginative effort on the part of the
observer.
This is evident from the advertising scheme adopted by
Nestle in promoting its coffee products. In this case, Nestle
has, over time, promoted its products as coffee perfection
worthy of masters like Robert Jaworski and Ric Puno Jr. In
associating its coffee products with the term MASTER
and thereby impressing them with the attributes of said
term, Nestle advertised its products thus: Robert Jaworski.
Living Legend. A true hard court hero. Fast on his feet.
Sure in every shot he makes. A master strategist. In one
word, unmatched. MASTER ROAST. Equally unmatched.
Rich and deeply satisfying.
Made from a unique
combination of the best coffee beans - Arabica for superior
taste and aroma, Robusta for strength and body. A
masterpiece only NESCAFE, the worlds coffee masters,
can create. MASTER ROAST. Coffee perfection worthy of
masters like Robert Jaworski. In the art of conversation,
Ric Puno Jr. is master. Witty. Well-informed. Confident. In
the art of coffee-making, nothing equals Master Roast, the
coffee masterpiece from Nescafe, the worlds coffee
masters. A unique combination of the best coffee beans Arabica for superior taste and aroma, Robusta for strength
and body. Truly distinctive and rich in flavor. Master Roast.
Coffee perfection worthy of masters like Ric Puno Jr.
The term MASTER, therefore, has acquired a certain
connotation to mean the coffee products MASTER ROAST
and MASTER BLEND produced by Nestle. As such, the
use by CFC of the term MASTER in the trademark for its
coffee product FLAVOR MASTER is likely to cause
confusion or mistake or even to deceive the ordinary
purchasers.

Societe des Produits vs. CA


The word MASTER is neither a generic nor a descriptive
term. As such, said term can not be invalidated as a
trademark and, therefore, may be legally protected.
Generic terms are those which constitute the common
descriptive name of an article or substance, or comprise
the genus of which the particular product is a species, or
are commonly used as the name or description of a kind
of goods, or imply reference to every member of a genus
and the exclusion of individuating characters, or refer to
the basic nature of the wares or services provided rather
than to the more idiosyncratic characteristics of a particular
product, and are not legally protectable. On the other
hand, a term is descriptive and therefore invalid as a
trademark if, as understood in its normal and natural
sense, it forthwith conveys the characteristics, functions,
qualities or ingredients of a product to one who has never
seen it and does not know what it is, or if it forthwith
conveys an immediate idea of the ingredients, qualities or
characteristics of the goods, or if it clearly denotes what
goods or services are provided in such a way that the
consumer does not have to exercise powers of perception
or imagination. Rather, the term MASTER is a
suggestive term brought about by the advertising
scheme of Nestle. Suggestive terms are those which, in
the phraseology of one court, require imagination, thought
and perception to reach a conclusion as to the nature of
the goods. Such terms, which subtly connote something
about the product, are eligible for protection in the
absence of secondary meaning. While suggestive marks
are capable of shedding some light upon certain
characteristics of the goods or services in dispute, they

Why are generic & descriptive terms not registrable?


MASSO HERMANOS CASE:
The import of the decision is that the trade-name may be
registered, but applicant-appellant may not be entitled to
the exclusive use of the terms "shirts factory" and "nylon"
as against any other who may subsequently use the said
terms, juris publici, incapable of appropriation by any single
individual to the exclusion of others. This is supported by
reason and authority.
A word or a combination of words which is merely
descriptive of an article of trade, or of its composition,
characteristics, or qualities, cannot be appropriated and
protected as a trademark to the exclusion of its use by
others. The reason for this is that inasmuch as all
persons have an equal right to produce and vend
similar articles, they also have the right to describe
them properly and to use any appropriate to himself
exclusively any word or expression, properly
descriptive of the article, its qualities, ingredients, or
characteristics, and thus limit other persons in the use
of language appropriate to the description of their
manufactures, the right to the use of such language
being common to all. This rule excluding descriptive
terms has also been held to apply to trade-names. As to
whether words employed fall within this prohibition, it is
said that the true test is not whether they are exhaustively
descriptive of the article designated, but whether in

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themselves, and as they are commonly used by those who


understand their meaning, they are reasonably indicative
and descriptive of the thing intended. If they are thus
descriptive, and not arbitrary, they cannot be appropriated
from general use and become the exclusive property of
anyone.
. . . If the trade-name consists of a descriptive word, no
monopoly of the right to use the same can be acquired.
This is but a corollary of the proposition that a descriptive
word cannot be the subject of a trade mark. Other may use
the same or similar descriptive word in connection with
their own wares, provided they take proper steps to prevent
the public being deceived. . . .
. . . The so-called descriptive terms, which may be used to
described the product adequately, can not be monopolized
by a single user and are available to all. It is only natural
that the trade will prefer those marks which bear some
reference to the article itself. Therefore, even those
descriptive marks which are distinctive by themselves can
be appropriated by others with impunity. A descriptive word
may be admittedly distinctive, especially if the user is the
first creator of the article. It will, however, be denied
protection, not because it lacks distinctiveness, but rather
because others are equally entitled to its use. . .
The claim that a combination of words may be registered
as a trade-name is no justification for not applying the rules
or principles hereinabove mentioned. The use of a generic
term in a trade-name is always conditional, i. e., subject to
the limitation that the registrant does not acquire the
exclusive right to the descriptive or generic term or word.
. . . A combination of marks or words may constitute a valid
trademark or (in the case of words) a tradename even
though some of the constituent portions thereof would not
be subject, separately, to exclusive appropriation as such.
Thus, although a word may be descriptive and not subject
to exclusive use as a trademark, it may properly become
the subject of a trademark by combination with another
word or term which is nondescriptive, although no
exclusive right to then descriptive word or term id
created . . .
The citation of appellant himself supports the decision thus:
". . . although perhaps not entitled to protection against
infringement by the use of the descriptive matter by
another."

Doctrine of Secondary Meaning

CASES:
Phil. Nut Industry vs. Standard (G.R. L-23055, July 31,
1975)
Petitioner, invoking American jurisprudence, asserts that
the first user of a tradename composed of common words
is given no special preference unless it is shown that such
words have acquired secondary meaning, and this,
respondent Standard Brands failed to do when no
evidence was presented to establish that fact.
The doctrine of secondary meaning is found in Sec. 4 (f),

Chapter II-A of the Trade-Mark Law, viz: Except as


expressly excluded in paragraphs (a), (b), (c) and (d) of this
section, nothing herein shall prevent the registration of a
mark or trade-name used by the applicant which has
become distinctive of the applicant's goods, business or
services. The Director may accept as prima facie evidence
that the mark or trade-name has become distinctive, as
applied to or used in connection with the applicant's goods,
business or services, proof of substantially exclusive and
continuous use thereof as a mark or trade-name by the
applicant in connection with the sale of goods, business or
services for the five years next preceding the date of the
filing of the application for its registration. (As amended by
Sec. 3, Rep. Act No. 638.)
This Court held that the doctrine is to the effect that a word
or phrase originally incapable of exclusive appropriation
with reference to an article on the market, because
geographically or otherwise descriptive, might nevertheless
have been used so long and so exclusively by one
producer with reference to his article that, in that trade and
to that branch of the purchasing public, the word or phrase
has come to mean that the article was his product.
By way of illustration, is the word "Selecta" which according
to this Court is a common ordinary term in the sense that it
may be used or employed by any one in promoting his
business or enterprise, but which once adopted or coined
in connection with one's business as an emblem, sign or
device to characterize its products, or as a badge of
authenticity, may acquire a secondary meaning as to be
exclusively associated with its products and business, so
that its use by another may lead to confusion in trade and
cause damage to its business.
The applicability of the doctrine of secondary meaning to
the situation now before Us is appropriate because there is
oral and documentary evidence showing that the word
PLANTERS has been used by and closely associated with
Standard Brands for its canned salted peanuts since 1938
in this country. Not only is that fact admitted by petitioner in
the amended stipulation of facts, but the matter has been
established by testimonial and documentary evidence
consisting of invoices covering the sale of "PLANTERS
cocktail peanuts". In other words, there is evidence to
show that the term PLANTERS has become a
distinctive mark or symbol insofar as salted peanuts
are concerned, and by priority of use dating as far
back as 1938, respondent Standard Brands has
acquired a preferential right to its adoption as its
trademark warranting protection against its usurpation
by another. Ubi jus ibi remedium. Where there is a right
there is a remedy. Standard Brands has shown the
existence of a property right(Arce Sons & Co. vs.
Selecta Biscuit Co., Inc., supra, pp. 262-263) and
respondent Director, has afforded the remedy.
Ang vs. Teodoro (74 Phil 50) (1942)
FACTS: Toribio Teodoro, at first in partnership with
Juan Katindig and later as sole proprietor, had
continuously used "Ang Tibay" both as trademark and
as tradename in the manufacture and sale of slippers,
shoes and indoor baseballs since 1910. He formally
registered it as a trademark on September 29, 1915
and as a tradename on January 3, 1933. Ana L. Ang
registered the same trademark "Ang Tibay" for pants
and shirts on April 11, 1932 and established a factory
for the manufacture of said articles in 1937. Suit was

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owner of the registered mark: Provided further, That the


interests of the owner of the registered mark are likely to be
damaged by such use. (n)

lodged by Teodoro against Ang to cancel the latter's


registration of the trademark "Ang Tibay" and to
perpetually enjoin her from using the said trademark on
goods manufactured and sold by her. The judgment of
the trial court absolved defendant (Ana L. Ang) from the
complaint with costs against the plaintiff. The Court of
Appeals reversed.

Rule 100 par. C. Trademark Regulations


Rule 102

HELD: In her second assignment of error petitioner


contends that the Court of Appeals erred in holding that
the words "Ang Tibay" had acquired a secondary
meaning. In view of the conclusion we have reached
upon the first assignment of error, it is unnecessary to
apply here the doctrine of "secondary meaning" in
trade-mark parlance. This doctrine is to the effect that a
word or phrase originally incapable of exclusive
appropriation with reference to an article of the market,
because geographically or otherwise descriptive, might
nevertheless have been used so long and so
exclusively by one producer with reference to his article
that, in that trade and to that branch of the purchasing
public, the word or phrase has come to mean that the
article was his product. (G. & C. Merriam Co. vs.
Salfield, 198 F., 369, 373.) We have said that the
phrase "Ang Tibay," being neither geographic nor
descriptive, was originally capable of exclusive
appropriation as a trade-mark. But were it not so, the
application of the doctrine of secondary meaning made
by the Court of Appeals could nevertheless be fully
sustained because, in any event, by respondent's long
and exclusive use of said phrase with reference to his
products and his business, it has acquired a proprietary
connotation. (Landers, Frary, and Clark vs. Universal
Cooler Corporation, 85 F. [2d], 46.)

CASE:
246 Corp. vs. Daway (G.R. No. 157216, Nov. 20, 2003)
Under the old Trademark Law where the goods for which
the identical marks are used are unrelated, there can be no
likelihood of confusion and there is therefore no
infringement in the use by the junior user of the registered
mark on the entirely different goods. This ruling, however,
has been to some extent, modified by Section 123.1(f) of
the Intellectual Property Code (Republic Act No. 8293),
which took effect on January 1, 1998. The said section
reads:
Sec. 123. Registrability. 123.1. A mark cannot be
registered if it: x x x
xxx
xxx

Well-Known Marks

Sec. 123.1 (e) Is identical with, or confusingly similar to, or


constitutes a translation of a mark which is considered by
the competent authority of the Philippines to be well-known
internationally and in the Philippines, whether or not it is
registered here, as being already the mark of a person
other than the applicant for registration, and used for
identical or similar goods or services: Provided, That in
determining whether a mark is well-known, account shall
be taken of the knowledge of the relevant sector of the
public, rather than of the public at large, including
knowledge in the Philippines which has been obtained as a
result of the promotion of the mark;
(f) Is identical with, or confusingly similar to, or constitutes
a translation of a mark considered well-known in
accordance with the preceding paragraph, which is
registered in the Philippines with respect to goods or
services which are not similar to those with respect to
which registration is applied for: Provided, That use of the
mark in relation to those goods or services would indicate a
connection between those goods or services, and the
owner of the registered mark: Provided further, That the
interests of the owner of the registered mark are likely to be
damaged by such use;
Sec.147.2. The exclusive right of the owner of a wellknown mark defined in Subsection 123.1(e) which is
registered in the Philippines, shall extend to goods and
services which are not similar to those in respect of which
the mark is registered: Provided, That use of that mark in
relation to those goods or services would indicate a
connection between those goods or services and the

(f) Is identical with, or confusingly similar to, or constitutes


a translation of a mark considered well-known in
accordance with the preceding paragraph, which is
registered in the Philippines with respect to goods or
services which are not similar to those with respect to
which registration is applied for: Provided, That use of the
mark in relation to those goods or services would indicate a
connection between those goods or services, and the
owner of the registered mark: Provided, further, That the
interest of the owner of the registered mark are likely to be
damaged by such use; (Emphasis supplied)
A junior user of a well-known mark on goods or services
which are not similar to the goods or services, and are
therefore unrelated, to those specified in the certificate of
registration of the well-known mark is precluded from using
the same on the entirely unrelated goods or services,
subject to the following requisites, to wit:
1. The mark is well-known internationally and in the
Philippines. Under Rule 102 of the Rules and Regulations
on Trademarks, Service Marks, Trade Names and Marked
or Stamped Containers, in determining whether a mark is
well known, the following criteria or any combination
thereof may be taken into account:
(a) the duration, extent and geographical area of any use
of the mark, in particular, the duration, extent and
geographical area of any promotion of the mark, including
advertising or publicity and presentation, at fairs or
exhibitions, of the goods and/or services to which the mark
applies;
(b) the market share in the Philippines and in other
countries, of the goods and/or services to which the mark
applies;
(c) the degree of the inherent or acquired distinction of the
mark;
(d) the quality-image or reputation acquired by the mark;

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(e) the extent to which the mark has been registered in the
world;
(f) the exclusivity of the registration attained by the mark in
the world;

recognition that each trademark infringement case


presents its own unique set of facts.
Indeed, the
complexities attendant to an accurate assessment of
likelihood of confusion require that the entire panoply of
elements constituting the relevant factual landscape be
comprehensively examined.

(g) the extent to which the mark has been used in the
world;

12. Well-known marks*

(h) the exclusivity of use attained by the mark in the world;

13. Trademark Dilution

(i) the commercial value attributed to the mark in the world;

CASE:

(j) the record of successful protection of the rights in the


mark;

14. Formal Requirement for application of registration

(k) the outcome of litigations dealing with the issue of


whether the mark is a well-known mark; and
(l) the presence of absence of identical or similar marks
validly registered for or used on identical or similar goods
or services and owned by persons other than the person
claiming that his mark is a well-known mark.
2. The use of the well-known mark on the entirely unrelated
goods or services would indicate a connection between
such unrelated goods or services and those goods or
services specified in the certificate of registration in the well
known mark. This requirement refers to the likelihood of
confusion of origin or business or some business
connection or relationship between the registrant and the
user of the mark.
3. The interests of the owner of the well-known mark are
likely to be damaged. For instance, if the registrant will be
precluded from expanding its business to those unrelated
good or services, or if the interests of the registrant of the
well-known mark will be damaged because of the inferior
quality of the good or services of the user.
Section 123.1(f) is clearly in point because the Music
Lounge of petitioner is entirely unrelated to respondents
business involving watches, clocks, bracelets, etc.
However, the Court cannot yet resolve the merits of the
present controversy considering that the requisites for the
application of Section 123.1(f), which constitute the kernel
issue at bar, clearly require determination facts of which
need to be resolved at the trial court. The existence or
absence of these requisites should be addressed in a full
blown hearing and not on a mere preliminary hearing. The
respondent must be given ample opportunity to prove its
claim, and the petitioner to debunk the same.

Section 124. Requirements of Application. - 124.1. The


application for the registration of the mark shall be in
Filipino or in English and shall contain the following:
(a) A request for registration;
(b) The name and address of the applicant;
(c) The name of a State of which the applicant is a national
or where he has domicile; and the name of a State in which
the applicant has a real and effective industrial or
commercial establishment, if any;
(d) Where the applicant is a juridical entity, the law under
which it is organized and existing;
(e) The appointment of an agent or representative, if the
applicant is not domiciled in the Philippines;
(f) Where the applicant claims the priority of an earlier
application, an indication of:
i) The name of the State with whose national office
the earlier application was filed or if filed with an office
other than a national office, the name of that office,
ii) The date on which the earlier application was
filed, and
iii) Where available, the application number of the
earlier application;
(g) Where the applicant claims color as a distinctive feature
of the mark, a statement to that effect as well as the name
or names of the color or colors claimed and an indication,
in respect of each color, of the principal parts of the mark
which are in that color;

SEE: MIRPURI CASE:


(h) Where the mark is a three-dimensional mark, a
statement to that effect;
11. Trademark Infringement is a relative concept

(i) One or more reproductions of the mark, as prescribed in


the Regulations;

In Esso Standard, Inc. v. Court of Appeals, we ruled that


the likelihood of confusion is a relative concept; to be
determined only according to the particular, and sometimes
peculiar, circumstances of each case. In trademark cases,
even more than in any other litigation, precedent must be
studied in light of the facts of the particular case. The
wisdom of the likelihood of confusion test lies in its

(j) A transliteration or translation of the mark or of some


parts of the mark, as prescribed in the Regulations;
(k) The names of the goods or services for which the
registration is sought, grouped according to the classes of
the Nice Classification, together with the number of the

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class of the said Classification to which each group of


goods or services belongs; and
(l) A signature by, or other self-identification of, the
applicant or his representative.
124.2. The applicant or the registrant shall file a declaration
of actual use of the mark with evidence to that effect, as
prescribed by the Regulations within three (3) years from
the filing date of the application. Otherwise, the application
shall be refused or the mark shall be removed from the
Register by the Director.
124.3. One (1) application may relate to several goods
and/or services, whether they belong to one (1) class or to
several classes of the Nice Classification.
124.4. If during the examination of the application, the
Office finds factual basis to reasonably doubt the veracity
of any indication or element in the application, it may
require the applicant to submit sufficient evidence to
remove the doubt. (Sec. 5, R.A. No. 166a)
15. Filing date
Section 127. Filing Date. - 127.1. Requirements. - The
filing date of an application shall be the date on which the
Office received the following indications and elements in
English or Filipino:
(a) An express or implicit indication that the registration of a
mark is sought;
(b) The identity of the applicant;
(c) Indications sufficient to contact the applicant or his
representative, if any;
(d) A reproduction of the mark whose registration is sought;
and
(e) The list of the goods or services for which the
registration is sought.
127.2. No filing date shall be accorded until the required
fee is paid. (n)
16. Priority Right of a Foreign Applicant
Section 131. Priority Right. - 131.1. An application for
registration of a mark filed in the Philippines by a person
referred to in Section 3, and who previously duly filed an
application for registration of the same mark in one of
those countries, shall be considered as filed as of the day
the application was first filed in the foreign country.

in Section 123.1(e) of this Act, that is not registered in the


Philippines, may, against an identical or confusingly similar
mark, oppose its registration, or petition the cancellation of
its registration or sue for unfair competition, without
prejudice to availing himself of other remedies provided for
under the law.
131.4. In like manner and subject to the same conditions
and requirements, the right provided in this section may be
based upon a subsequent regularly filed application in the
same foreign country: Provided, That any foreign
application filed prior to such subsequent application has
been withdrawn, abandoned, or otherwise disposed of,
without having been laid open to public inspection and
without leaving any rights outstanding, and has not served,
nor thereafter shall serve, as a basis for claiming a right of
priority. (Sec. 37, R.A. No. 166a)
17. Certificate of Registration
Section 138. Certificates of Registration. - A certificate of
registration of a mark shall be prima facie evidence of the
validity of the registration, the registrant's ownership of the
mark, and of the registrant's exclusive right to use the
same in connection with the goods or services and those
that are related thereto specified in the certificate. (Sec. 20,
R.A. No. 165)
CASES:

18. Duration of the registration (Sec. 145; 146.2)


Section 145. Duration. - A certificate of registration shall
remain in force for ten (10) years: Provided, That the
registrant shall file a declaration of actual use and evidence
to that effect, or shall show valid reasons based on the
existence of obstacles to such use, as prescribed by the
Regulations, within one (1) year from the fifth anniversary
of the date of the registration of the mark. Otherwise, the
mark shall be removed from the Register by the Office.
(Sec. 12, R.A. No. 166a)
Section 146. Renewal. - 146.1. A certificate of registration
may be renewed for periods of ten (10) years at its
expiration upon payment of the prescribed fee and upon
filing of a request. The request shall contain the following
indications:
(a) An indication that renewal is sought;
(b) The name and address of the registrant or his
successor-in-interest, hereafter referred to as the "right
holder";
(c) The registration number of the registration concerned;

131.2. No registration of a mark in the Philippines by a


person described in this section shall be granted until such
mark has been registered in the country of origin of the
applicant.
131.3. Nothing in this section shall entitle the owner of a
registration granted under this section to sue for acts
committed prior to the date on which his mark was
registered in this country: Provided, That, notwithstanding
the foregoing, the owner of a well-known mark as defined

(d) The filing date of the application which resulted in the


registration concerned to be renewed;
(e) Where the right holder has a representative, the name
and address of that representative;
(f) The names of the recorded goods or services for which
the renewal is requested or the names of the recorded

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goods or services for which the renewal is not requested,


grouped according to the classes of the Nice Classification
to which that group of goods or services belongs and
presented in the order of the classes of the said
Classification; and
(g) A signature by the right holder or his representative.
146.2. Such request shall be in Filipino or English and may
be made at any time within six (6) months before the
expiration of the period for which the registration was
issued or renewed, or it may be made within six (6) months
after such expiration on payment of the additional fee
herein prescribed.
146.3. If the Office refuses to renew the registration, it shall
notify the registrant of his refusal and the reasons therefor.
146.4. An applicant for renewal not domiciled in the
Philippines shall be subject to and comply with the
requirements of this Act. (Sec. 15, R.A. No. 166a)
19. Rights conferred with registration
SEC. 14. Section 147 of Republic Act No. 8293, otherwise
known as the Intellectual Property Code of the Philippines,
is hereby amended to read as follows:
"SEC. 147. Rights Conferred. - 147.1. Except in cases of
importation of drugs and medicines allowed under Section
72.1 of this Act and of off-patent drugs and medicines, the
owner of a registered mark shall have the exclusive right to
prevent all third parties not having the owner's consent
from using in the course of trade identical or similar signs
or containers for goods or services which are identical or
similar to those in respect of which the trademark is
registered where such use would result in a likelihood of
confusion. In case of the use of an identical sign for
identical goods or services, a likelihood of confusion shall
be presumed.
"There shall be no infringement of trademarks or
tradenames of imported or sold patented drugs and
medicines allowed under Section 72.1 of this Act, as well
as imported or sold off-patent drugs and medicines:
Provided, That, said drugs and medicines bear the
registered marks that have not been tampered, unlawfully
modified, or infringed upon, under Section 155 of this
Code.
"147.2. x x x."
Sec. 147.2. The exclusive right of the owner of a wellknown mark defined in Subsection 123.1(e) which is
registered in the Philippines, shall extend to goods and
services which are not similar to those in respect of which
the mark is registered: Provided, That use of that mark in
relation to those goods or services would indicate a
connection between those goods or services and the
owner of the registered mark: Provided further, That the
interests of the owner of the registered mark are likely to be
damaged by such use. (n)
20. Limitation of rights
Section 148. Use of Indications by Third Parties for
Purposes Other than those for which the Mark is Used. Registration of the mark shall not confer on the
registered owner the right to preclude third parties

from using bona fide their names, addresses,


pseudonyms, a geographical name, or exact
indications concerning the kind, quality, quantity,
destination, value, place of origin, or time of
production or of supply, of their goods or services:
Provided, That such use is confined to the purposes of
mere identification or information and cannot mislead the
public as to the source of the goods or services. (n)
21.Assignment
Registration

and

Transfer

of

Application

and

Section 149. Assignment and Transfer of Application and


Registration. - 149.1. An application for registration of a
mark, or its registration, may be assigned or transferred
with or without the transfer of the business using the mark.
(n)
149.2. Such assignment or transfer shall, however, be null
and void if it is liable to mislead the public, particularly as
regards the nature, source, manufacturing process,
characteristics, or suitability for their purpose, of the goods
or services to which the mark is applied.
149.3. The assignment of the application for registration of
a mark, or of its registration, shall be in writing and require
the signatures of the contracting parties. Transfers by
mergers or other forms of succession may be made by any
document supporting such transfer.
149.4. Assignments and transfers of registrations of marks
shall be recorded at the Office on payment of the
prescribed fee; assignment and transfers of applications for
registration shall, on payment of the same fee, be
provisionally recorded, and the mark, when registered,
shall be in the name of the assignee or transferee.
149.5. Assignments and transfers shall have no effect
against third parties until they are recorded at the Office.
(Sec. 31, R.A. No. 166a)
22. License Contracts
Section 150. License Contracts. - 150.1. Any license
contract concerning the registration of a mark, or an
application therefor, shall provide for effective control by
the licensor of the quality of the goods or services of the
licensee in connection with which the mark is used. If the
license contract does not provide for such quality control,
or if such quality control is not effectively carried out, the
license contract shall not be valid.
150.2. A license contract shall be submitted to the Office
which shall keep its contents confidential but shall record it
and publish a reference thereto. A license contract shall
have no effect against third parties until such recording is
effected. The Regulations shall fix the procedure for the
recording of the license contract. (n)
23. Cancellation of Registration
Section 151. Cancellation. - 151.1. A petition to cancel a
registration of a mark under this Act may be filed with the
Bureau of Legal Affairs by any person who believes that he
is or will be damaged by the registration of a mark under
this Act as follows:

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(a) Within five (5) years from the date of the registration of
the mark under this Act.
(b) At any time, if the registered mark becomes the generic
name for the goods or services, or a portion thereof, for
which it is registered, or has been abandoned, or its
registration was obtained fraudulently or contrary to the
provisions of this Act, or if the registered mark is being
used by, or with the permission of, the registrant so as to
misrepresent the source of the goods or services on or in
connection with which the mark is used. If the registered
mark becomes the generic name for less than all of the
goods or services for which it is registered, a petition to
cancel the registration for only those goods or services
may be filed. A registered mark shall not be deemed to be
the generic name of goods or services solely because such
mark is also used as a name of or to identify a unique
product or service. The primary significance of the
registered mark to the relevant public rather than
purchaser motivation shall be the test for determining
whether the registered mark has become the generic name
of goods or services on or in connection with which it has
been used. (n)
(c) At any time, if the registered owner of the mark without
legitimate reason fails to use the mark within the
Philippines, or to cause it to be used in the Philippines by
virtue of a license during an uninterrupted period of three
(3) years or longer.
151.2. Notwithstanding the foregoing provisions, the court
or the administrative agency vested with jurisdiction to hear
and adjudicate any action to enforce the rights to a
registered mark shall likewise exercise jurisdiction to
determine whether the registration of said mark may be
cancelled in accordance with this Act. The filing of a suit to
enforce the registered mark with the proper court or
agency shall exclude any other court or agency from
assuming jurisdiction over a subsequently filed petition to
cancel the same mark. On the other hand, the earlier filing
of petition to cancel the mark with the Bureau of Legal
Affairs shall not constitute a prejudicial question that must
be resolved before an action to enforce the rights to same
registered mark may be decided. (Sec. 17, R.A. No. 166a)
CASES:

152.3. The use of a mark in connection with one or more of


the goods or services belonging to the class in respect of
which the mark is registered shall prevent its cancellation
or removal in respect of all other goods or services of the
same class.
152.4. The use of a mark by a company related with the
registrant or applicant shall inure to the latter's benefit, and
such use shall not affect the validity of such mark or of its
registration: Provided, That such mark is not used in such
manner as to deceive the public. If use of a mark by a
person is controlled by the registrant or applicant with
respect to the nature and quality of the goods or services,
such use shall inure to the benefit of the registrant or
applicant. (n)
25. Infringement; Elements *
NOTES:
Section 22 of R.A. No. 166, otherwise known as the
Trademark Law, provides in part as follows:
Sec. 22. Infringement, what constitutes. Any person who
shall use, without the consent of the registrant, any
reproduction, counterfeit, copy or colorable imitation of any
registered mark or trade-name in connection with the sale,
offering for sale, or advertising of any goods, business or
services on or in connection with which such use is likely to
cause confusion or mistake or to deceive purchasers or
others as to the source or origin of such goods or services
or identity of such business; or reproduce, counterfeit copy
or colorably imitate any such mark or trade name and
apply such reproduction, counterfeit copy or colorable
imitation to labels, signs, prints, packages, wrappers,
receptacles or advertisements intended to be used upon or
in connection with such goods, business or services, shall
be liable to a civil action by the registrant for any or all of
the remedies herein provided.
In Mighty Corporation v. E & J Gallo Winery, the Court held
that the following constitute the elements of trademark
infringement in accordance not only with Section 22 of R.A.
No. 166, as amended, but also Sections 2, 2-A, 9-A[54]
and 20 thereof:
(a)
a trademark actually used in commerce in
the Philippines and registered in the principal register of
the Philippine Patent Office,

Bata Industries Ltd. vs. CA (114 SCRA 318 (1982))


Emerald Garment Mfg., vs. CA. supra

24. Non-use of Mark when excused *


Section 152. Non-use of a Mark When Excused. - 152.1.
Non-use of a mark may be excused if caused by
circumstances arising independently of the will of the
trademark owner. Lack of funds shall not excuse non-use
of a mark.
152.2. The use of the mark in a form different from the form
in which it is registered, which does not alter its distinctive
character, shall not be ground for cancellation or removal
of the mark and shall not diminish the protection granted to
the mark.

(b)
is used by another person in connection
with the sale, offering for sale, or advertising of any goods,
business or services or in connection with which such use
is likely to cause confusion or mistake or to deceive
purchasers or others as to the source or origin of such
goods or services, or identity of such business; or such
trademark is reproduced, counterfeited, copied or colorably
imitated by another person and such reproduction,
counterfeit, copy or colorable imitation is applied to labels,
signs, prints, packages, wrappers, receptacles or
advertisements intended to be used upon or in connection
with such goods, business or services as to likely cause
confusion or mistake or to deceive purchasers,
(c)
goods, and

the trademark is used for identical or similar

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(d)
such act is done without the consent of the
trademark registrant or assignee.
___
To establish trademark infringement, the following
elements must be shown: (1) the validity of plaintiff's mark;
(2) the plaintiff's ownership of the mark; and (3) the use of
the mark or its colorable imitation by the alleged infringer
results in "likelihood of confusion." Of these, it is the
element of likelihood of confusion that is the gravamen of
trademark infringement. (McDonald Corp. Case, 2004)
-The essential element of infringement is colorable
imitation. (Emerald Garments Case)
Colorable Imitation has been defined as "such a close
or ingenious imitation as to be calculated to deceive
ordinary purchasers, or such resemblance of the
infringing mark to the original as to deceive an
ordinary purchaser giving such attention as a
purchaser usually gives, and to cause him to purchase
the one supposing it to be the other."
Colorable imitation does not mean such similitude as
amounts to identity. Nor does it require that all the
details be literally copied. Colorable imitation refers to
such similarity in form, content, words, sound,
meaning, special arrangement, or general appearance
of the trademark or tradename with that of the other
mark or tradename in their over-all presentation or in
their essential, substantive and distinctive parts as
would likely mislead or confuse persons in the
ordinary course of purchasing the genuine article.
-In determining whether colorable imitation exists,
jurisprudence has developed two kinds of tests the
Dominancy Test applied in Asia Brewery, Inc. v. Court of
Appeals and other cases and the Holistic Test developed in
Del Monte Corporation v. Court of Appeals and its
proponent cases.
Distinctions between infringement of trademark and
unfair competition.
(1) Infringement of trademark is the unauthorized use of a
trademark, whereas unfair competition is the passing off of
one's goods as those of another.
(2) In infringement of trademark fraudulent intent is
unnecessary whereas in unfair competition fraudulent
intent is essential.
(3) In infringement of trademark the prior registration of the
trademark is a prerequisite to the action, whereas in unfair
competition registration is not necessary

copy, or colorable imitation of a registered mark or the


same container or a dominant feature thereof in connection
with the sale, offering for sale, distribution, advertising of
any goods or services including other preparatory steps
necessary to carry out the sale of any goods or services on
or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive; or
155.2. Reproduce, counterfeit, copy or colorably imitate a
registered mark or a dominant feature thereof and apply
such reproduction, counterfeit, copy or colorable imitation
to labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used in commerce upon or
in connection with the sale, offering for sale, distribution, or
advertising of goods or services on or in connection with
which such use is likely to cause confusion, or to cause
mistake, or to deceive, shall be liable in a civil action for
infringement by the registrant for the remedies hereinafter
set forth: Provided, That the infringement takes place at the
moment any of the acts stated in Subsection 155.1 or this
subsection are committed regardless of whether there is
actual sale of goods or services using the infringing
material. (Sec. 22, R.A. No 166a)

27. Actions, Damages and Injunction for Infringement


Section 156. Actions, and Damages and Injunction for
Infringement. - 156.1. The owner of a registered mark may
recover damages from any person who infringes his rights,
and the measure of the damages suffered shall be either
the reasonable profit which the complaining party would
have made, had the defendant not infringed his rights, or
the profit which the defendant actually made out of the
infringement, or in the event such measure of damages
cannot be readily ascertained with reasonable certainty,
then the court may award as damages a reasonable
percentage based upon the amount of gross sales of the
defendant or the value of the services in connection with
which the mark or trade name was used in the infringement
of the rights of the complaining party. (Sec. 23, first par.,
R.A. No. 166a)
156.2. On application of the complainant, the court may
impound during the pendency of the action, sales invoices
and other documents evidencing sales. (n)
156.3. In cases where actual intent to mislead the public or
to defraud the complainant is shown, in the discretion of
the court, the damages may be doubled. (Sec. 23, first
par., R.A. No. 166)
156.4. The complainant, upon proper showing, may also be
granted injunction. (Sec. 23, second par., R.A. No. 166a)

Section 157. Power of Court to Order Infringing Material


Destroyed. - 157.1 In any action arising under this Act, in
which a violation of any right of the owner of the registered
mark is established, the court may order that goods found
to be infringing be, without compensation of any sort,
26. Remedies for Infringement
disposed of outside the channels of commerce in such a
Section 155. Remedies; Infringement. - Any person who manner as to avoid any harm caused to the right holder, or
shall, without the consent of the owner of the registered destroyed; and all labels, signs, prints, packages,
wrappers, receptacles and advertisements in the
mark:
possession of the defendant, bearing the registered mark
or trade name or any reproduction, counterfeit, copy or
155.1. Use in commerce any reproduction, counterfeit,
colorable imitation thereof, all plates, molds, matrices and
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other means of making the same, shall be delivered up and


destroyed.

consideration. Hence, the instant petition.

157.2. In regard to counterfeit goods, the simple removal of


the trademark affixed shall not be sufficient other than in
exceptional cases which shall be determined by the
Regulations, to permit the release of the goods into the
channels of commerce. (Sec. 24, R.A. No. 166a)

ISSUE: Whether, despite the institution of an Inter


Partes case for cancellation of a mark with the
BPTTT (now the Bureau of Legal Affairs,
Intellectual Property Office) by one party, the
adverse party can file a subsequent action for
infringement with the regular courts of justice in
connection with the same registered mark.

Section 158. Damages; Requirement of Notice. - In any


suit for infringement, the owner of the registered mark shall
not be entitled to recover profits or damages unless the
acts have been committed with knowledge that such
imitation is likely to cause confusion, or to cause mistake,
or to deceive. Such knowledge is presumed if the registrant
gives notice that his mark is registered by displaying with
the mark the words '"Registered Mark" or the letter R within
a circle or if the defendant had otherwise actual notice of
the registration. (Sec. 21, R.A. No. 166a)
Section 170. Penalties. - Independent of the civil and
administrative sanctions imposed by law, a criminal penalty
of imprisonment from two (2) years to five (5) years and a
fine ranging from Fifty thousand pesos (P50,000) to Two
hundred thousand pesos(P200,000), shall be imposed on
any person who is found guilty of committing any of the
acts mentioned in Section 155, Section 168 and
Subsection 169.1. (Arts. 188 and 189, Revised Penal
Code)
CASES:
Shangri-la Int'l Hotel Management vs. CA (G.R.
No. 111580, june 21, 2001)
FACTS:
The
Shangri-La
International
Hotel
Management, Ltd., Shangri-La Properties, Inc., Makati
Shangri-La Hotel and Resort, Inc. and Kuok Philippine
Properties, Inc. filed with the Bureau of Patents,
Trademarks and Technology Transfer (BPTTT) a
petition, praying for the cancellation of the registration
of the Shangri-La mark and S device/logo issued to
the Developers Group of Companies, Inc., on the
ground that the same was illegally and fraudulently
obtained and appropriated for the latters restaurant
business. The Shangri-La Group alleged that it is the
legal and beneficial owners of the subject mark and
logo; that it has been using the said mark and logo for
its corporate affairs and business since March 1962
and caused the same to be specially designed for their
international hotels in 1975, much earlier than the
alleged first use thereof by the Developers Group in
1982.
Likewise, the Shangri-La Group filed with the BPTTT its
own application for registration of the subject mark and
logo. The Developers Group filed an opposition to the
application. Almost three (3) years later, or on April 15,
1991, the Developers Group instituted with the RTC, a
complaint for infringement and damages with prayer for
injunction against the Shangri-La Group. The ShangriLa Group moved for the suspension of the proceedings
in the infringement case on account of the pendency of
the administrative proceedings before the BPTTT. This
was denied by the trial court. The Shangri-La Group
filed a Motion for Reconsideration. The Shangri-La
Group filed a petition for certiorari before the CA. CA
rendered its decision dismissing the petition for
certiorari. The Shangri-La Group filed a Motion for
Reconsideration, which was denied on the ground that
the same presented no new matter that warranted

HELD: SC rule in the affirmative. Section 151.2 of


Republic Act No. 8293, otherwise known as the
Intellectual Property Code, provides, as follows
Section 151.2. Notwithstanding the foregoing
provisions, the court or the administrative agency
vested with jurisdiction to hear and adjudicate any
action to enforce the rights to a registered mark
shall likewise exercise jurisdiction to determine
whether the registration of said mark may be
cancelled in accordance with this Act. The filing
of a suit to enforce the registered mark with the
proper court or agency shall exclude any other
court or agency from assuming jurisdiction over a
subsequently filed petition to cancel the same
mark. On the other hand, the earlier filing of
petition to cancel the mark with the Bureau of
Legal Affairs shall not constitute a prejudicial
question that must be resolved before an
action to enforce the rights to same registered
mark may be decided. (Emphasis provided)
Similarly, Rule 8, Section 7, of the Regulations on
Inter Partes Proceedings, provides to wit
Section 7. Effect of filing of a suit before the
Bureau or with the proper court. - The filing of a
suit to enforce the registered mark with the proper
court or Bureau shall exclude any other court or
agency from assuming jurisdiction over a
subsequently filed petition to cancel the same
mark. On the other hand, the earlier filing of
petition to cancel the mark with the Bureau
shall not constitute a prejudicial question that
must be resolved before an action to enforce
the rights to same registered mark may be
decided. (Emphasis provided)
Hence, as applied in the case at bar, the earlier
institution of an Inter Partes case by the ShangriLa Group for the cancellation of the Shangri-La
mark and S device/logo with the BPTTT cannot
effectively bar the subsequent filing of an
infringement case by registrant Developers
Group. The law and the rules are explicit.
The rationale is plain: Certificate of Registration
No. 31904, upon which the infringement case is
based, remains valid and subsisting for as long as
it has not been cancelled by the Bureau or by an
infringement court. As such, Developers Groups
Certificate of Registration in the principal register
continues as 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 specified in the
certificate. Since the certificate still subsists,
Developers Group may thus file a corresponding

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infringement suit and recover damages from any


person who infringes upon the formers rights.
The case of Conrad and Company, Inc. v. Court
of Appeals is in point. We held: We cannot see
any error in the above disquisition. It might be
mentioned that while an application for the
administrative cancellation of a registered
trademark on any of the grounds enumerated in
Section 17 of Republic Act No. 166, as amended,
otherwise known as the Trade-Mark Law, falls
under the exclusive cognizance of BPTTT (Sec.
19, Trade-Mark Law), an action, however, for
infringement or unfair competition, as well as the
remedy of injunction and relief for damages, is
explicitly
and
unquestionably
within
the
competence and jurisdiction of ordinary courts.
Surely, an application with BPTTT for an
administrative cancellation of a registered trade
mark cannot per se have the effect of restraining
or preventing the courts from the exercise of their
lawfully conferred jurisdiction. A contrary rule
would unduly expand the doctrine of primary
jurisdiction which, simply expressed, would
merely behoove regular courts, in controversies
involving specialized disputes, to defer to the
findings or resolutions of administrative tribunals
on certain technical matters. This rule, evidently,
did not escape the appellate court for it likewise
decreed that for good cause shown, the lower
court, in its sound discretion, may suspend the
action pending outcome of the cancellation
proceedings before the BPTTT.
Following both law and the jurisprudence
enunciated in Conrad and Company, Inc. v. Court
of Appeals, the infringement case can and should
proceed independently from the cancellation case
with the Bureau so as to afford the owner of
certificates of registration redress and injunctive
writs. In the same light, so must the cancellation
case with the BPTTT (now the Bureau of Legal
Affairs, Intellectual Property Office) continue
independently from the infringement case so as to
determine whether a registered mark may
ultimately be cancelled. However, the Regional
Trial Court, in granting redress in favor of
Developers Group, went further and upheld the
validity and preference of the latters registration
over that of the Shangri-La Group. There can be
no denying that the infringement court may validly
pass upon the right of registration. Section 161 of
Republic Act No. 8293 provides to wit
SEC. 161. Authority to Determine Right to
Registration In any action involving a registered
mark the court may determine the right to
registration, order the cancellation of the
registration, in whole or in part, and otherwise
rectify the register with respect to the registration
of any party to the action in the exercise of this.
Judgement and orders shall be certified by the
court to the Director, who shall make appropriate
entry upon the records of the Bureau, and shall
be controlled thereby. (Sec. 25, R.A. No. 166a).

28.Limitations to Actions for Infringement


RA 8293, Section 159. Limitations to Actions for
Infringement. - Notwithstanding any other provision of
this Act, the remedies given to the owner of a right
infringed under this Act shall be limited as follows:
159.1. Notwithstanding the provisions of Section 155
hereof, a registered mark shall have no effect against any
person who, in good faith, before the filing date or the
priority date, was using the mark for the purposes of his
business or enterprise: Provided, That his right may only
be transferred or assigned together with his enterprise or
business or with that part of his enterprise or business in
which the mark is used.
159.2. Where an infringer who is engaged solely in the
business of printing the mark or other infringing materials
for others is an innocent infringer, the owner of the right
infringed shall be entitled as against such infringer only to
an injunction against future printing.
159.3. Where the infringement complained of is contained
in or is part of paid advertisement in a newspaper,
magazine, or other similar periodical or in an electronic
communication, the remedies of the owner of the right
infringed as against the publisher or distributor of such
newspaper, magazine, or other similar periodical or
electronic communication shall be limited to an injunction
against the presentation of such advertising matter in
future issues of such newspapers, magazines, or other
similar periodicals or in future transmissions of such
electronic communications. The limitations of this
subparagraph shall apply only to innocent infringers:
Provided, That such injunctive relief shall not be available
to the owner of the right infringed with respect to an issue
of a newspaper, magazine, or other similar periodical or an
electronic communication containing infringing matter
where restraining the dissemination of such infringing
matter in any particular issue of such periodical or in an
electronic communication would delay the delivery of such
issue or transmission of such electronic communication is
customarily conducted in accordance with the sound
business practice, and not due to any method or device
adopted to evade this section or to prevent or delay the
issuance of an injunction or restraining order with respect
to such infringing matter. (n)
RA No. 9502, SEC. 15. Section 159 of Republic Act No.
8293, otherwise known as the Intellectual Property
Code of the Philippines, is hereby amended to read as
follows:
"SEC. 159. Limitations to Actions for Infringement. Notwithstanding any other provision of this Act, the
remedies given to the owner of a right infringed under this
Act shall be limited as follows:
"159.1. x x x;
"159.2 x x x;
"159.3 x x x; and
"159.4 There shall be no infringement of trademarks or
tradenames of imported or sold drugs and medicines
allowed under Section 72.1 of this Act, as well as imported
or sold off-patent drugs and medicines: Provided, That said
drugs and medicines bear the registered marks that have
not been tampered, unlawfully modified, or infringed upon
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as defined under Section 155 of this Code."

29. Rights of Foreign Corporation to sue in Trademark


or Service Mark Enforcement action
Section 160. Right of Foreign Corporation to Sue in
Trademark or Service Mark Enforcement Action. - Any
foreign national or juridical person who meets the
requirements of Section 3 of this Act and does not engage
in business in the Philippines may bring a civil or
administrative
action
hereunder
for
opposition,
cancellation, infringement, unfair competition, or false
designation of origin and false description, whether or not it
is licensed to do business in the Philippines under existing
laws. (Sec. 21-A, R.A. No. 166a)
CASES:
Leviton Industrieds vs. Salvador (114 SCRA 420) (1982)
General Garments vs. Director of Patents (41 SCRA 50)
(1971)

La Chemise Lacoste vs. Fernandez


But even assuming the truth of the private respondents
allegation that the petitioner failed to allege material facts
in its petition relative to capacity to sue, the petitioner may
still maintain the present suit against respondent
Hernandes. As early as 1927, this Court was, and it still is,
of the view that a foreign corporation not doing
business in the Philippines needs no license to sue
before Philippine courts for infringement of trademark
and unfair competition. Thus, in Western Equipment and
Supply Co. v. Reyes (51 Phil. 11 5), this Court held that a
foreign corporation which has never done any business in
the Philippines and which is unlicensed and unregistered
to do business here, but is widely and favorably known in
the Philippines through the use therein of its products
bearing its corporate and tradename, has a legal right to
maintain an action in the Philippines to restrain the
residents and inhabitants thereof from organizing a
corporation therein bearing the same name as the
foreign corporation, when it appears that they have
personal knowledge of the existence of such a foreign
corporation, and it is apparent that the purpose of the
proposed domestic corporation is to deal and trade in
the same goods as those of the foreign corporation.
Converse Rubber vs. Universal Rubber (this case cited
the La Chemise case ruling)

30. Trade names or business names


Section 165. Trade Names or Business Names. - 165.1. A
name or designation may not be used as a trade name if
by its nature or the use to which such name or designation
may be put, it is contrary to public order or morals and if, in
particular, it is liable to deceive trade circles or the public
as to the nature of the enterprise identified by that name.

165.2.(a) Notwithstanding any laws or regulations providing


for any obligation to register trade names, such names
shall be protected, even prior to or without registration,
against any unlawful act committed by third parties.
(b) In particular, any subsequent use of the trade name by
a third party, whether as a trade name or a mark or
collective mark, or any such use of a similar trade name or
mark, likely to mislead the public, shall be deemed
unlawful.
165.3. The remedies provided for in Sections 153 to 156
and Sections 166 and 167 shall apply mutatis mutandis.
165.4. Any change in the ownership of a trade name shall
be made with the transfer of the enterprise or part thereof
identified by that name. The provisions of Subsections
149.2 to 149.4 shall apply mutatis mutandis
31. Goods bearing infringing marks of Trade names
Section 166. Goods Bearing Infringing Marks or Trade
Names. - No article of imported merchandise which shall
copy or simulate the name of any domestic product, or
manufacturer, or dealer, or which shall copy or simulate a
mark registered in accordance with the provisions of this
Act, or shall bear a mark or trade name calculated to
induce the public to believe that the article is manufactured
in the Philippines, or that it is manufactured in any foreign
country or locality other than the country or locality where it
is in fact manufactured, shall be admitted to entry at any
customhouse of the Philippines. In order to aid the officers
of the customs service in enforcing this prohibition, any
person who is entitled to the benefits of this Act, may
require that his name and residence, and the name of the
locality in which his goods are manufactured, a copy of the
certificate of registration of his mark or trade name, to be
recorded in books which shall be kept for this purpose in
the Bureau of Customs, under such regulations as the
Collector of Customs with the approval of the Secretary of
Finance shall prescribe, and may furnish to the said
Bureau facsimiles of his name, the name of the locality in
which his goods are manufactured, or his registered mark
or trade name, and thereupon the Collector of Customs
shall cause one (1) or more copies of the same to be
transmitted to each collector or to other proper officer of the
Bureau of Customs. (Sec. 35, R.A. No. 166)
32. Unfair
remedies

competition,

rights,

regulations

and

Section 168. Unfair Competition, Rights, Regulation and


Remedies. - 168.1. A person who has identified in the mind
of the public the goods he manufactures or deals in, his
business or services from those of others, whether or not a
registered mark is employed, has a property right in the
goodwill of the said goods, business or services so
identified, which will be protected in the same manner as
other property rights.
168.2. Any person who shall employ deception or any other
means contrary to good faith by which he shall pass off the
goods manufactured by him or in which he deals, or his
business, or services for those of the one having
established such goodwill, or who shall commit any acts
calculated to produce said result, shall be guilty of unfair
competition, and shall be subject to an action therefor.

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168.3. In particular, and without in any way limiting the


scope of protection against unfair competition, the following
shall be deemed guilty of unfair competition:
(a) Any person, who is selling his goods and gives
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
influence purchasers to believe that the goods offered 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, or any
subsequent vendor of such goods or any agent of any
vendor engaged in selling such goods with a like purpose;
(b) Any person who by any artifice, or device, or
who employs any other means calculated to induce the
false belief that such person is offering the services of
another who has identified such services in the mind of the
public; or
(c) Any person who shall make any false statement
in the course of trade or who shall commit any other act
contrary to good faith of a nature calculated to discredit the
goods, business or services of another.
168.4. The remedies provided by Sections 156, 157 and
161 shall apply mutatis mutandis. (Sec. 29, R.A. No. 166a)
NOTES:
The essential elements of an action for unfair
competition are (1) confusing similarity in the general
appearance of the goods, and (2) intent to deceive the
public and defraud a competitor. The confusing
similarity may or may not result from similarity in the
marks, but may result from other external factors in the
packaging or presentation of the goods. The intent to
deceive and defraud may be inferred from the
similarity of the appearance of the goods as offered for
sale to the public. Actual fraudulent intent need not be
shown.
Unfair competition is broader than trademark
infringement and includes passing off goods with or
without
trademark
infringement.
Trademark
infringement is a form of unfair competition.
Trademark infringement constitutes unfair competition
when there is not merely likelihood of confusion, but
also actual or probable deception on the public
because of the general appearance of the goods. There
can be trademark infringement without unfair
competition as when the infringer discloses on the
labels containing the mark that he manufactures the
goods, thus preventing the public from being deceived
that the goods originate from the trademark owner.
CASES:
Proline Sports Center vs. CA (281 SCRA 162)
American Wire vs. Director of Patents (31 SCRA 544)
In-N-Out Burger Inc vs. Sehwani Incorporated

and/or Benita's Frites Inc. (G.R. No. 179127,


Decmeber 24, 2008)
FACTS: Petitioner IN-N-OUT BURGER, INC., a
business entity incorporated under the laws of
California, United States (US) of America, which is a
signatory to the Convention of Paris on Protection of
Industrial Property and the Agreement on Trade
Related Aspects of Intellectual Property Rights
(TRIPS). Petitioner is engaged mainly in the restaurant
business, but it has never engaged in business in the
Philippines.
On 2 June 1997, petitioner filed trademark and service
mark applications with the Bureau of Trademarks
(BOT) of the IPO for "IN-N-OUT" and "IN-N-OUT
Burger & Arrow Design." Petitioner later found out,
through the Official Action Papers issued by the IPO on
31 May 2000, that respondent Sehwani, Incorporated
had already obtained Trademark Registration for the
mark "IN N OUT (the inside of the letter "O" formed like
a star)." By virtue of a licensing agreement, Benita
Frites, Inc. was able to use the registered mark of
respondent Sehwani, Incorporated. Petitioner pointed
out that its internationally well-known trademarks and
the mark of the respondents are all registered for the
restaurant business and are clearly identical and
confusingly similar. Petitioner claimed that respondents
are making it appear that their goods and services are
those of the petitioner, thus, misleading ordinary and
unsuspecting consumers that they are purchasing
petitioners products.
However, respondent is claiming good faith and that
they have openly and continuously used the subject
mark since 1982 and is in the process of expanding its
business. They contend that assuming that there is
value in the foreign registrations presented as evidence
by the petitioner, the purported exclusive right to the
use of the subject mark based on such foreign
registrations is not essential to a right of action for
unfair competition. Respondents also claim that actual
or probable deception and confusion on the part of
customers by reason of respondents practices must
always appear, and in the present case, the Bureau of
Legal Affairs (BLA) of the IPO has found none.
ISSUE: Whether or not Sehwani, Incorporated and/or
Benitas Frites, Inc. are guilty of unfair competition
HELD: Yes. The essential elements of an action for
unfair competition are (1) confusing similarity in the
general appearance of the goods and (2) intent to
deceive the public and defraud a competitor. The
confusing similarity may or may not result from
similarity in the marks, but may result from other
external factors in the packaging or presentation of the
goods. The intent to deceive and defraud may be
inferred from the similarity of the appearance of the
goods as offered for sale to the public. Actual
fraudulent intent need not be shown.
With such finding, the award of damages in favor of
petitioner is but proper. This is in accordance with
Section 168.4 of the Intellectual Property Code, which
provides that the remedies under Sections 156, 157
and 161 for infringement shall apply mutatis mutandis
to unfair competition. The remedies provided under
Section 156 include the right to damages, to be
computed in the following manner:
Section 156. Actions, and Damages and Injunction
for Infringement.--156.1
The owner of a registered mark may recover damages
from any person who infringes his rights, and the
measure of the damages suffered shall be either
the reasonable profit which the complaining party
would have made, had the defendant not infringed

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They have held that there is no fetish in the word


"competition," and that the invocation of equity rest more
vitally on the element of unfairness." As we have stated,
appellant have not shown any well-established reputation
or goodwill previous to the establishment of appellees'
business, such that it can be said that something was
unfairly taken by the use of such reputation by the
appellees' department store.

his rights, or the profit which the defendant actually


made out of the infringement, or in the event such
measure of damages cannot be readily ascertained
with reasonable certainty, then the court may award
as damages a reasonable percentage based upon
the amount of gross sales of the defendant or the
value of the services in connection with which the
mark or trade name was used in the infringement of
the rights of the complaining party.

33. False Designation of Origin, False Description or


representation

NOTES:
The Courts have come to realize that there can be
unfair competition or unfair trading even if the goods
are non-competing, and that such unfair trading can
cause injury or damage to the first user of a given
trade mark, first, by prevention of the natural
expansion of his business, and second, by having his
business reputation confused with and put at the
mercy of the second user.
In the case of Ang vs. Wellington (cited the cases of
Ang vs. Teodoro and Teodoro Kalaw Ng Khe vs. Lever
Brothers Co.)
The concept of unfair competition has received the
attention of this Court in two previous cases, that of Ang vs.
Teodoro and Teodoro Kalaw Ng Khe vs. Lever Brothers
Co.2 (G.R. No. 46817, promulgated on April 18, 1941.) In
the first case this Court stated that even a name or phrase
not capable of appropriation as trademark or trade name
may, by long and exclusive use by a business with
reference thereto or to its products, acquire a proprietary
connotation, such that the name or phrase to the
purchasing public becomes associated with the business
or the products and entitled to protection against unfair
competition. But in the case at bar, the principle therein
enunciated cannot be made to apply because the evidence
submitted by the appellants did not prove that their
business has continued for so long a time that it has
become of consequence and acquired a goodwill of
considerable value, such that its articles and products have
acquired a well-known reputation and confusion will result
by the use of the disputed name by the defendants'
department store. It is true that appellants business
appears to have been established a few years before the
war and appellees' after liberation, yet it seems appellees'
business and goodwill are the products of their own
individual initiative, not wrested by unfair competition from
appellants' business and goodwill.

Section 169. False Designations of Origin; False


Description or Representation. - 169.1. Any person who, on
or in connection with any goods or services, or any
container for goods, uses in commerce any word, term,
name, symbol, or device, or any combination thereof, or
any false designation of origin, false or misleading
description of fact, or false or misleading representation of
fact, which:
(a) Is likely to cause confusion, or to cause
mistake, or to deceive as to the affiliation, connection, or
association of such person with another person, or as to
the origin, sponsorship, or approval of his or her goods,
services, or commercial activities by another person; or
(b) In commercial advertising or promotion,
misrepresents the nature, characteristics, qualities, or
geographic origin of his or her or another person's goods,
services, or commercial activities, shall be liable to a civil
action for damages and injunction provided in Sections 156
and 157 of this Act by any person who believes that he or
she is or is likely to be damaged by such act.
169.2. Any goods marked or labelled in contravention of
the provisions of this Section shall not be imported into the
Philippines or admitted entry at any customhouse of the
Philippines. The owner, importer, or consignee of goods
refused entry at any customhouse under this section may
have any recourse under the customs revenue laws or may
have the remedy given by this Act in cases involving goods
refused entry or seized. (Sec. 30, R.A. No. 166a)

In the case of Kalaw Ng Khe vs. Lever Brothers Co., this


Court citing a well-considered opinion of the Court of
Appeals published in 39 Off. Gaz., 1479-1486, No. 62, May
21, 1941, declared that it is not necessary that the articles
of the petitioner be exactly similar to those handled by
respondents in order that unfair competition may be said to
arise, and that it is sufficient for the articles to fall under the
general category of toilet articles. It might be true that,
inasmuch as appellees' department store deals on shirts
and other articles of wear while appellants produce the
same articles, some competition would arise between
them. It is not, however, competition that the law seeks to
prevent, but unfair competition, wherein a newcomer in
business tries to grab or steal away the reputation or
goodwill of the business of another. As the court stated in
said case, "the tendency of the courts has been to widen
the scope of protection in the field of unfair competition.
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