MIRPURI VS.

CA

FACTS
Lolita Escobar applied with the Bureau of Patents for the registration of the trademark
Barbizon, alleging that she had been manufacturing and selling these products since 1970.
private respondent Barbizon Corp opposed the application in IPC No. 686. The Bureau granted
the application and a certificate of registration was issued for the trademark Barbizon. Escobar
later assigned all her rights and interest over the trademark to petitioner Mirpuri. In 1979,
Escobar failed to file with the Bureau the Affidavit of Use of the trademark. Due to his failure, the
Bureau cancelled the certificate of registration. Escobar reapplied and Mirpuri also applied and
this application was also opposed by private respondent in IPC No. 2049, claiming that it adopted
said trademark in 1933 and has been using it. It obtained a certificate from the US Patent Office
in 1934. Then in 1991, DTI cancelled petitioners registration and declared private respondent
the owner and prior user of the business name Barbizon International.

ISSUE
Whether or not the treaty (Paris Convention) affords protection to a foreign corporation
against a Philippine applicant for the registration of a similar trademark.

HELD
The Court held in the affirmative. RA 8293 defines trademark as any visible sign capable of
distinguishing goods. 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. 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.

COCA-COLA BOTTLERS, PHILS., INC. (CCBPI), Naga Plant, petitioner,

vs.
QUINTIN J. GOMEZ, a.k.a. "KIT" GOMEZ and DANILO E. GALICIA, a.k.a. "DANNY
GALICIA", respondents.

FACTS:
Coca-Cola applied for a search warrant against Pepsi for hoarding Coke empty bottles in Pepsi's
yard in Concepcion Grande, Naga City, an act allegedly penalized as unfair competition under the
IP Code. Coca-Cola claimed that the bottles must be confiscated to preclude their illegal use,
destruction or concealment by the respondents. In support of the application, Coca-Cola

submitted the sworn statements of three witnesses: Naga plant representative Arnel John Ponce
said he was informed that one of their plant security guards had gained access into the Pepsi
compound and had seen empty Coke bottles; acting plant security officer Ylano A. Regaspi said
he investigated reports that Pepsi was hoarding large quantities of Coke bottles by requesting
their security guard to enter the Pepsi plant and he was informed by the security guard that
Pepsi hoarded several Coke bottles; security guard Edwin Lirio stated that he entered Pepsi's
yard on July 2, 2001 at 4 p.m. and saw empty Coke bottles inside Pepsi shells or cases.
Municipal Trial Court (MTC) Executive Judge Julian C. Ocampo of Naga City, after taking the joint
deposition of the witnesses, issued Search Warrant No. 2001-01 to seize 2,500 Litro and 3,000
eight and 12 ounces empty Coke bottles at Pepsi's Naga yard for violation of Section 168.3 (c) of
the IP Code.
In their counter-affidavits, Galicia and Gomez claimed that the bottles came from various Pepsi
retailers and wholesalers who included them in their return to make up for shortages of empty
Pepsi bottles; they had no way of ascertaining beforehand the return of empty Coke bottles as
they simply received what had been delivered; the presence of the bottles in their yard was not
intentional nor deliberate.
The respondents also filed motions for the return of their shells and to quash the search warrant.
Coca-Cola opposed the motions as the shells were part of the evidence of the crime, arguing that
Pepsi used the shells in hoarding the bottles. It insisted that the issuance of warrant was based
on probable cause for unfair competition under the IP Code, and that the respondents violated
R.A. 623, the law regulating the use of stamped or marked bottles, boxes, and other similar
containers.
The MTC issued the first assailed order denying the twin motions. It explained there was an
exhaustive examination of the applicant and its witnesses through searching questions and that
the Pepsi shells are prima facie evidence that the bottles were placed there by the respondents.
The MTC denied the motion for reconsideration in the second assailed order, explaining that the
issue of whether there was unfair competition can only be resolved during trial.
The respondents responded by filing a petition for certiorari under Rule 65 of the Revised Rules of
Court before the Regional Trial Court (RTC) of Naga City on the ground that the subject search
warrant was issued without probable cause and that the empty shells were neither mentioned in
the warrant nor the objects of the perceived crime.
The RTC voided the warrant for lack of probable cause and the non-commission of the crime of
unfair competition, even as it implied that other laws may have been violated by the
respondents. The RTC, though, found no grave abuse of discretion on the part of the issuing MTC
judge.

ISSUE:
Whether the Naga MTC was correct in issuing Search Warrant No. 2001-01 for the seizure of the
empty Coke bottles from Pepsi's yard for probable violation of Section 168.3 (c) of the IP Code.

HELD:
NO.
We clarify at the outset that while we agree with the RTC decision, our agreement is more in the
result than in the reasons that supported it. The decision is correct in nullifying the search
warrant because it was issued on an invalid substantive basis - the acts imputed on the
respondents do not violate Section 168.3 (c) of the IP Code. For this reason, we deny the present
petition.
In the context of the present case, the question is whether the act charged - alleged to be
hoarding of empty Coke bottles - constitutes an offense under Section 168.3 (c) of the IP Code.
Section 168 in its entirety states:
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.
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)

From jurisprudence, unfair competition has been defined as the passing off (or palming off) or
attempting to pass off upon the public the goods or business of one person as the goods or
business of another with the end and probable effect of deceiving the public. It formulated the
"true test" of unfair competition: whether the acts of defendant are such as are calculated to
deceive the ordinary buyer making his purchases under the ordinary conditions which prevail in
the particular trade to which the controversy relates. One of the essential requisites in an action
to restrain unfair competition is proof of fraud; the intent to deceive must be shown before the
right to recover can exist. The advent of the IP Code has not significantly changed these rulings
as they are fully in accord with what Section 168 of the Code in its entirety provides. Deception,
passing of and fraud upon the public are still the key elements that must be present for unfair
competition to exist.
The act alleged to violate the petitioner's rights under Section 168.3 (c) is hoarding which we
gather to be the collection of the petitioner's empty bottles so that they can be withdrawn from
circulation and thus impede the circulation of the petitioner's bottled products. This, according to
the petitioner, is an act contrary to good faith - a conclusion that, if true, is indeed an unfair act
on the part of the respondents. The critical question, however, is not the intrinsic unfairness of
the act of hoarding; what is critical for purposes of Section 168.3 (c) is to determine if the
hoarding, as charged, "is of a nature calculated to discredit the goods, business or services" of
the petitioner.
We hold that it is not. Hoarding as defined by the petitioner is not even an act within the
contemplation of the IP Code.
Under all the above approaches, we conclude that the "hoarding" - as defined and charged by
the petitioner - does not fall within the coverage of the IP Code and of Section 168 in particular. It
does not relate to any patent, trademark, trade name or service mark that the respondents have
invaded, intruded into or used without proper authority from the petitioner. Nor are the
respondents alleged to be fraudulently "passing off" their products or services as those of the
petitioner. The respondents are not also alleged to be undertaking any representation or
misrepresentation that would confuse or tend to confuse the goods of the petitioner with those of
the respondents, or vice versa. What in fact the petitioner alleges is an act foreign to the Code,
to the concepts it embodies and to the acts it regulates; as alleged, hoarding inflicts unfairness
by seeking to limit the opposition's sales by depriving it of the bottles it can use for these sales.
Based on the foregoing, we conclude that the RTC correctly ruled that the petitioner's search
warrant should properly be quashed for the petitioner's failure to show that the acts imputed to
the respondents do not violate the cited offense. There could not have been any probable cause
to support the issuance of a search warrant because no crime in the first place was effectively
charged. This conclusion renders unnecessary any further discussion on whether the search
warrant application properly alleged that the imputed act of holding Coke empties was in fact a
"hoarding" in bad faith aimed to prejudice the petitioner's operations, or whether the MTC duly
complied with the procedural requirements for the issuance of a search warrant under Rule 126
of the Rules of Court.

EMERALD GARMENT MANUFACTURING CORPORATION vs. HON. COURT OF APPEALS,

BUREAU OF PATENTS, TRADEMARKS AND TECHNOLOGY TRANSFER and H.D. LEE
COMPANY, INC.

FACTS:
On 18 September 1981, private respondent H.D. Lee Co., Inc. filed with the Bureau of
Patents, Trademarks & Technology Transfer (BPTTT) a Petition for Cancellation of Registration No.
SR 5054 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.

Private respondent averred that petitioner's trademark "so closely resembled its own trademark,
'LEE' as previously registered and used in thePhilippines cause confusion, mistake and deception
on the part of the purchasing public as to the origin of the goods.

On 19 July 1988, the Director of Patents rendered a decision granting private respondent's
petition for cancellation and opposition to registration. The Director of Patents, using the test of
dominancy, declared that petitioner's trademark was confusingly similar to private respondent's
mark because "it is the word 'Lee' which draws the attention of the buyer and leads him to
conclude that the goods originated from the same manufacturer. It is undeniably the dominant
feature of the mark.

ISSUE:
Whether or not a trademark causes confusion and is likely to deceive the public is a
question of fact which is to be resolved by applying the "test of dominancy", meaning, if the
competing trademark contains the main or essential or dominant features of another by reason
of which confusion and deception are likely to result.

HELD:
The word "LEE" is the most prominent and distinctive feature of the appellant's trademark
and all of the appellee's "LEE" trademarks. It is the mark which draws the attention of the buyer
and leads him to conclude that the goods originated from the same manufacturer. The alleged
difference is too insubstantial to be noticeable. The likelihood of confusion is further made more
probable by the fact that both parties are engaged in the same line of business.

Although the Court decided in favor of the respondent, the appellee has sufficiently established
its right to prior use and registration of the trademark "LEE" in the Philippines and is thus entitled
to protection from any infringement upon the same. The dissenting opinion of Justice Padilla is
more acceptable.

Elidad Kho vs Court of Appeals

Elidad Kho is the owner of KEC Cosmetics Laboratory and she was also the holder of copyrights
over Chin Chun Su and its Oval Facial Cream Container/Case. She also bought the patent rights
over the Chin Chun Su & Device and Chin Chun Su for medicated cream from one Quintin Cheng,
who was the assignee of Shun Yi Factory a Taiwanese factory actually manufacturing Chin Chun
Su products.
Kho filed a petition for injunction against Summerville General Merchandising and Company to
enjoin the latter from advertising and selling Chin Chun Su products, in similar containers as that
of Kho, for this is misleading the public and causing Kho to lose income; the petition is also to
enjoin Summerville from infringing upon Khos copyrights.
Summerville in their defense alleged that they are the exclusive and authorized importer, repacker and distributor of Chin Chun Su products; that Shun Yi even authorized Summerville to
register its trade name Chin Chun Su Medicated Cream with the Philippine Patent Office; that
Quintin Cheng, from whom Kho acquired her patent rights, had been terminated (her services) by
Shun Yi.
ISSUE: Whether or not Kho has the exclusive right to use the trade name and its container.
HELD: No. Kho 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 (not copyright like what she registered for) 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. Khos 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.

AIRPHIL VS PENNSWELL
Trade secrets should receive greater protection from discovery, because they derive economic
value from being generally unknown and not readily ascertainable by the public.
Facts:
1. Petitioner Air Philippines Corporation is a domestic corporation engaged in the business of
air transportation services. On the other hand, respondent Pennswell, Inc. was organized
to engage in the business of manufacturing and selling industrial chemicals, solvents, and
special lubricants.
2. Respondent delivered and sold to petitioner sundry goods in trade. Under the contracts,
petitioners total outstanding obligation amounted to P449,864.98 with interest at 14% per
annum until the amount would be fully paid. For failure of the petitioner to comply with its
obligation under said contracts, respondent filed a Complaint for a Sum of Money on 28
April 2000 with the RTC.

3. In its Answer, petitioner alleged that it was defrauded in the amount of P592,000.00 by
respondent for its previous sale of four items. Petitioner asserted that it was deceived by
respondent which merely altered the names and labels of such goods. Petitioner
asseverated that had respondent been forthright about the identical character of the
products, it would not have purchased the items complained of.
4. Moreover, petitioner alleged that when the purported fraud was discovered, a conference
was held between petitioner and respondent on 13 January 2000, whereby the parties
agreed that respondent would return to petitioner the amount it previously paid. However,
petitioner was surprised when it received a letter from the respondent, demanding
payment of the amount of P449,864.94, which later became the subject of respondents
Complaint for Collection of a Sum of Money against petitioner.
5. During the pendency of the trial, petitioner filed a Motion to Compel respondent to give a
detailed list of the ingredients and chemical components of the following products. The
RTC rendered an Order granting the petitioners motion.
6. Respondent sought reconsideration of the foregoing Order, contending that it cannot be
compelled to disclose the chemical components sought because the matter is
confidential. It argued that what petitioner endeavored to inquire upon constituted a trade
secret which respondent cannot be forced to divulge.
7. The RTC gave credence to respondents reasoning, and reversed itself. Alleging grave
abuse of discretion on the part of the RTC, petitioner filed a Petition for Certiorari under
Rule 65 of the Rules of Court with the Court of Appeals, which denied the Petition and
affirmed the Order dated 30 June 2004 of the RTC. Petitioners Motion for Reconsideration
was denied. Unyielding, petitioner brought the instant Petition before SC.

Issue:
W/N CA erred in upholding RTC decision denying petitioners motion to subject respondents
products to compulsory disclosure.
Held:
No. The products are covered by the exception of trade secrets being divulged in compulsory
disclosure. The Court affirms the ruling of the Court of Appeals which upheld the finding of the
RTC that there is substantial basis for respondent to seek protection of the law for its proprietary
rights over the detailed chemical composition of its products.
The Supreme Court has declared that trade secrets and banking transactions are
among the recognized restrictions to the right of the people to information as
embodied in the Constitution. SC said that the drafters of the Constitution also unequivocally
affirmed that, aside from national security matters and intelligence information, trade or
industrial secrets (pursuant to the Intellectual Property Code and other related laws) as well as
banking transactions (pursuant to the Secrecy of Bank Deposits Act), are also exempted from
compulsory disclosure.
A trade secret is defined as a plan or process, tool, mechanism or compound known only to its
owner and those of his employees to whom it is necessary to confide it. The definition also

extends to a secret formula or process not patented, but known only to certain individuals using
it in compounding some article of trade having a commercial value. American jurisprudence has
utilized the following factors to determine if an information is a trade secret, to wit:
(1) the extent to which the information is known outside of the employers business;
(2) the extent to which the information is known by employees and others involved in the
business;
(3) the extent of measures taken by the employer to guard the secrecy of the information;
(4) the value of the information to the employer and to competitors;
(5) the amount of effort or money expended by the company in developing the information; and
(6) the extent to which the information could be easily or readily obtained through an
independent source.
Rule 27 sets an unequivocal proviso that the documents, papers, books, accounts, letters,
photographs, objects or tangible things that may be produced and inspected should not be
privileged. The documents must not be privileged against disclosure. On the ground of public
policy, the rules providing for production and inspection of books and papers do not authorize the
production or inspection of privileged matter; that is, books and papers which, because of
their confidential and privileged character, could not be received in evidence. Such a
condition is in addition to the requisite that the items be specifically described, and must
constitute or contain evidence material to any matter involved in the action and which are in the
partys possession, custody or control.
In the case at bar, petitioner cannot rely on Section 77of Republic Act 7394, or the Consumer Act
of the Philippines, in order to compel respondent to reveal the chemical components of its
products. While it is true that all consumer products domestically sold, whether manufactured
locally or imported, shall indicate their general make or active ingredients in their respective
labels of packaging, the law does not apply to respondent. Respondents specialized lubricants
namely, Contact Grease, Connector Grease, Thixohtropic Grease, Di-Electric Strength
Protective Coating, Dry Lubricant and Anti-Seize Compound are not consumer products.
What is clear from the factual findings of the RTC and the Court of Appeals is that the chemical
formulation of respondents products is not known to the general public and is unique only to it.
Both courts uniformly ruled that these ingredients are not within the knowledge of the public.
Since such factual findings are generally not reviewable by this Court, it is not duty-bound to
analyze and weigh all over again the evidence already considered in the proceedings below.
The revelation of respondents trade secrets serves no better purpose to the disposition of the
main case pending with the RTC, which is on the collection of a sum of money. As can be
gleaned from the facts, petitioner received respondents goods in trade in the normal course of
business. To be sure, there are defenses under the laws of contracts and sales available to
petitioner. On the other hand, the greater interest of justice ought to favor respondent as the
holder of trade secrets. Weighing the conflicting interests between the parties, SC rules in favor
of the greater interest of respondent. Trade secrets should receive greater protection
from discovery, because they derive economic value from being generally unknown
and not readily ascertainable by the public.

PEARL AND DEAN VS. SHOEMART

Facts:
Pearl and Dean is a corporation engaged in the manufacture of advertising display units simply
referred to as light boxes.Pearland Dean was able to secure a Certificate of Copyright
Registration.Pearland Dean, received reports that exact copies of its light boxes were installed at
SM City and in the fastfood section of SM Cubao. In the light of its discoveries,Pearland Dean sent
a letter dated December 11, 1991 to both SMI enjoining it to cease using the subject light boxes
and to remove the same from SMIs establishments. It also demanded the discontinued use of
the trademark Poster Ads. SMI noted that the registration of the mark Poster Ads was only for
stationeries such as letterheads, envelopes, and the like. Besides, according to SMI, the word
Poster Ads is a generic term which cannot be appropriated as a trademark, and, as such,
registration of such mark is invalid.
Issue:
Whether or not there was copyright infringement.
Held:
The SC ruled in favor of the Shoemart Inc adopting the ruling of court of appeals and by coming
up with its own ruling. To wit:
The records show thatPearland Dean applied for the registration of the trademark Poster Ads
with the Bureau of Patents, Trademarks, and Technology Transfer. Said trademark was recorded in
the Principal Register covering the following products: stationeries such as letterheads,
envelopes and calling cards and newsletters.
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
With this as factual backdrop, we see no legal basis to the finding of liability on the part of the
defendants-appellants for their use of the words Poster Ads, in the advertising display units in
suit
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.
The Supreme Court also distinguished Trademark, Copyright and Patents:
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.

ANGELITA MANZANO, petitioner, vs. COURT OF APPEALS, and MELECIA MADOLARIA, as

Assignor to NEW UNITED FOUNDRY MANUFACTURING CORPORATION, respondents.

FACTS:
The petitioner filed an action for the cancellation of Letters of Patent covering a gas burner
registered in the name of responded Melecia Madolaria who subsequently assigned the letter of
patent to United Foundry. Petitioner alleged that the private respondent was not the original, true
and actual inventor nor did she derive her rights from the original, true and actual inventor of the
utility model covered by the letter of patent; further alleged that the utility model covered by the
subject letter of patent had been known or used by others in the Philippines for than one (1) year
before she filed her application for letter of patent on Dec 1979. For failure to present
substantive proof of her allegations, the lower court and Court of Appeals denied the action for
cancellation. Hence, the present petition.
ISSUE:
Whether or not the respondent court wrongfully denied the cancellation of letter of patent
registered under the private respondent.
HELD:
No. 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. Clearly enough, the petitioner
failed to present clear and satisfactory proof to overcome every reasonable doubt to afford the
cancellation of the patent to the private respondent.

Smith Kline Beckman Corporation vs Court of Appeals

Smith Kline is a US corporation licensed to do business in the Philippines. In 1981, a patent was
issued to it for its invention entitled Methods and Compositions for Producing Biphasic
Parasiticide Activity Using Methyl 5 Propylthio-2-Benzimidazole Carbamate. The invention is a
means to fight off gastrointestinal parasites from various cattles and pet animals.
Tryco Pharma is a local corporation engaged in the same business as Smith Kline.
Smith Kline sued Tryco Pharma because the latter was selling a veterinary product called
Impregon which contains a drug called Albendazole which fights off gastrointestinal roundworms, lungworms, tapeworms and fluke infestation in carabaos, cattle and
goats.

Smith Kline is claiming that Albendazole is covered in their patent because it is substantially the
same as methyl 5 propylthio-2-benzimidazole carbamate covered by its patent since both of
them are meant to combat worm or parasite infestation in animals. And that Albendazole is
actually patented under Smith Kline in the US.
Tryco Pharma averred that nowhere in Smith Klines patent does it mention that Albendazole is
present but even if it were, the same is unpatentable.
Smith Kline thus invoked the doctrine of equivalents, which implies that the two substances
substantially do the same function in substantially the same way to achieve the same results,
thereby making them truly identical for in spite of the fact that the word Albendazole does not
appear in Tryco Paharmas letters of patent, it has ably shown by evidence its sameness with
methyl 5 propylthio-2-benzimidazole carbamate.
ISSUE: Whether or not there is patent infringement in this case
HELD: No. Smith Kline failed to prove that Albendazole is a compound inherent in the patented
invention. Nowhere in the patent is the word Albendazole found. When the language of its claims
is clear and distinct, the patentee is bound thereby and may not claim anything beyond them.
Further, there was a separate patent for Albendazole given by the US which implies that
Albendazole is indeed separate and distinct from the patented compound here.
A scrutiny of Smith Klines evidence fails to prove the substantial sameness of the patented
compound and Albendazole. While both compounds have the effect of neutralizing parasites in
animals, identity of result does not amount to infringement of patent unless Albendazole
operates in substantially the same way or by substantially the same means as the patented
compound, even though it performs the same function and achieves the same result. In other
words, the principle or mode of operation must be the same or substantially the same.
The doctrine of equivalents thus requires satisfaction of the function-means-and-result test, the
patentee having the burden to show that all three components of such equivalency test are met.

Creser Precision Systems Inc. v CA and Floro International Co.

Facts:
Respondent was granted by the Bureau of Patents, Trademarks and Technology Transfer (BPTTT)
a Letter of patent for its aerial fuze on January 23, 1990. Sometime in 1993, respondent
discovered that the petitioner submitted samples of its patented aerial fuze to the AFP for testing
claiming to be his own. To protect its right, respondent sent letter of warning to petitioner on a
possible court action should it proceed its testing by the AFP. In response the petitioner filed a
complaint for injunction and damages arising from alleged infringement before the RTC asserting
that it is the true and actual inventor of the aerial fuze which it developed on 1981 under the Self
Reliance Defense Posture Program of the AFP. It has been supplying the military of the aerial fuze
since then and that the fuze of the respondent is similar as that of the petitioner. Petitioner
prayed for restraining order and injunction from marketing, manufacturing and profiting from the
said invention by the respondent. The trial court ruled in favor of the petitioner citing the fact
that it was the first to develop the aerial fuze since 1981 thsu it concludes that it is the
petitioners aerial fuze that was copied by the respondent. Moreover, the claim of respondent is

solely based on its letter of patent which validity is being questioned. On

appeal, respondent argued that the petitioner has no cause of action since he has no right to
assert there being no patent issued to his aerial fuze. The Court of Appeals reversed the decision
of the trial court dismissing the complaint of the petitioner. It was the contention of the petitioner
that it can file under Section 42 of the Patent Law an action for infringement not as a patentee
but as an entity in possession of a right, title or interest to the patented invention. It theorizes
that while the absence of a patent prevents one from lawfully suing another for infringement of
said patent, such absence does not bar the true and actual inventor of the patented invention
from suing another in the same nature as a civil action for infringement.
Issue:
Whether or not the petitioner has the right to assail the validity of the patented work of the
respondent?
Ruling:
The court finds the argument of the petitioner untenable. Section 42 of the Law on Patent (RA
165) provides that only the patentee or his successors-in-interest may file an action against
infringement. What the law contemplates in the phrase anyone possessing any right, title or
interest in and to the patented invention refers only to the patentees successors-in-interest,
assignees or grantees since the action onpatent infringement may be brought only in the name
of the person granted with the patent. There can be no infringement of a patent until a patent
has been issued since the right one has over the invention covered by the patent arises from the
grant of the patent alone. Therefore, a person who has not been granted letter of patent over an
invention has not acquired right or title over the invention and thus has no cause of action for
infringement. Petitioner admitted to have no patent over his invention. Respondents aerial
fuze is covered byletter of patent issued by the Bureau of Patents thus it has in his favor not only
the presumption of validity of its patent but that of a legal and factual first and true inventor of
the invention.

VENANCIO SAMBAR, doing business under the name and style of CVS Garment
Enterprises vs. LEVI STRAUSS & CO., LEVI STRAUSS (PHIL.), INC.
FACTS:
Private respondents alleged in their complaint that Levi Strauss and Co. (LS&Co.), an
internationally known clothing manufacturer, own the arcuate design trademark which was
registered under US Trademark Registration No. 404,248 on November 16, 1943. That sometime
in 1987, CVSGIC and Venancio Sambar, without the consent and authority of private respondents
and in infringement and unfair competition, sold and advertised, and despite demands to cease
and desist, continued to manufacture, sell and advertise denim, pants under the brand name
Europress with back pockets bearing a design similar to the arcuate trademark of private
respondents, thereby causing confusion on the buying public, prejudiced to private respondents
goodwill and property right.
Sambar filed a separate answer. He admitted that copyright Registration No. 1-1998 was issued

to him, but he denied using it. He said he did not authorize anyone to use the copyrighted
design.
Trial court issued a writ of preliminary injunction enjoining CVSGIC and petitioner from
manufacturing, advertising and selling pants with the arcuate design on their back pockets.
Private respondents moved for reconsideration praying for the cancellation of petitioners
copyright registration.
Trial court granted the prayer.
Petitioner appealed to the Court of Appeals which affirmed the ruling of the trial court.
ISSUE:
Whether petitioner infringe on private respondents arcuate design.
HELD:
To be entitled to a copyright, the thing being copyrighted must be original, created by the author
through his own skill, labor and judgment, without directly copying or evasively imitating the
work of another.
Both the trail court and the Court of Appeals found there was infringement.

Roberto Del Rosario vs Court of Appeals

FACTS:
Roberto Del Rosario was granted a patent for his innovation called the Minus One karaoke. The
patent was issued in June 1988 for five years and was renewed in November 1991 for another
five years as there were improvement introduced to his minus one karaoke. In 1993, while the
patent was still effective, Del Rosario sued Janito Corporation, a Japanese company owned by
Janito Cua, for allegedly infringing upon the patent of Del Rosario. Del Rosario alleged that Janito
was manufacturing a sing-along system under the brand miyata karaoke which is substantially,
if not identical, the same to his minus one karaoke. The lower court ruled in favor of Del
Rosario but the Court of Appeals ruled that there was no infringement because the karaoke
system was a universal product manufactured, advertised, and marketed all over the world long
before Del Rosario was issued his patents.
ISSUE: Whether or not the Court of Appeals erred in its ruling.
HELD: Yes. The Patent Law expressly acknowledges that any new model of implements or tools
of any industrial product even if not possessed of the quality of invention but which is of practical
utility is entitled to a patent for utility model. Here, there is no dispute that the letters patent
issued to Del Rosario are for utility models of audio equipment. It is elementary that a patent
may be infringed where the essential or substantial features of the patented invention are taken
or appropriated, or the device, machine or other subject matter alleged to infringe is
substantially identical with the patented invention. In order to infringe a patent, a machine or

device must perform the same function, or accomplish the same result by identical or
substantially identical means and the principle or mode of operation must be substantially the
same. In the case at bar, miyata karaoke was proven to have substantial if not identical
functionality as that of the minus one karaoke which was covered by the second patent issued to
Del Rosario. Further, Janito failed to present competent evidence that will show that Del Rosarios
innovation is not new.

GODINEZ V CA
Through this petition for review in certiorari of a decision of the Court of Appeals affirming the
decision of the trial court, petitioner Pascual Godines seeks to reverse the adverse decision of the
Court a quo that he was liable for infringement of patent and unfair competition. The dispositive
portion of the assailed decision is hereby quoted to wit:
WHEREFORE, with the elimination of the award for attorney's fees, the judgment appealed from
is hereby AFFIRMED, with costs against appellant. 1
The patent involved in this case is Letters Patent No. UM-2236 issued by the Philippine Patent
Office to one Magdalena S. Villaruz on July 15, 1976. It covers a utility model for a hand tractor or
power tiller, the main components of which are the following: "(1) a vacuumatic house float; (2) a
harrow with adjustable operating handle; (3) a pair of paddy wheels; (4) a protective water
covering for the engine main drive; (5) a transmission case; (6) an operating handle; (7) an
engine foundation on the top midportion of the vacuumatic housing float to which the main
engine drive is detachedly installed; (8) a frontal frame extension above the quarter circularly
shaped water covering hold (sic) in place the transmission case; (9) a V-belt connection to the
engine main drive with transmission gear through the pulley, and (10) an idler pulley installed on
the engine foundation." 2 The patented hand tractor works in the following manner: "the engine
drives the transmission gear thru the V-belt, a driven pulley and a transmission shaft. The engine
drives the transmission gear by tensioning of the V-belt which is controlled by the idler pulley.
The V-belt drives the pulley attached to the transmission gear which in turn drives the shaft
where the paddy wheels are attached. The operator handles the hand tractor through a handle
which is inclined upwardly and supported by a pair of substanding pipes and reinforced by a Ushaped G.I. pipe at the V-shaped end." 3
The above mentioned patent was acquired by SV-Agro Industries Enterprises, Inc., herein private
respondent, from Magdalena Villaruz, its chairman and president, by virtue of a Deed of
Assignment executed by the latter in its favor. On October 31, 1979, SV-Agro Industries caused
the publication of the patent in Bulletin Today, a newspaper of general circulation.
In accordance with the patent, private respondent manufactured and sold the patented power
tillers with the patent imprinted on them. In 1979, SV-Agro Industries 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 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
Regional Trial Court a complaint for infringement of patent and unfair competition.
After trial, the court held Pascual Godines liable for infringement of patent and unfair
competition. The dispositive portion of the decision reads as follows:
WHEREFORE, premises considered, JUDGMENT is hereby rendered in favor of the plaintiff SV-Agro
Industries Enterprises, Inc., and against defendant Pascual Godines:
1. Declaring the writ of preliminary injunction issued by this Court against defendant as
permanent;
2. Ordering defendant Pascual Godines to pay plaintiff the sum of Fifty Thousand Pesos
(P50,000.00) as damages to its business reputation and goodwill, plus the further sum of Eighty
Thousand Pesos (P80,000.00) for unrealized profits during the period defendant was
manufacturing and selling copied or imitation floating power tiller;
3. Ordering the defendant to pay the plaintiff, the further sum of Eight Thousand Pesos
(P8,000.00) as reimbursement of attorney's fees and other expenses of litigation; and to pay the
costs of the suit.
SO ORDERED. 4
The decision was affirmed by the appellate court.
Thereafter, this petition was filed. Petitioner maintains the defenses which he raised before the
trial and appellate courts, to wit: that he was not engaged in the manufacture and sale of the
power tillers as he made them only upon the special order of his customers who gave their own
specifications; hence, he could not be liable for infringement of patent and unfair competition;
and that those made by him were different from those being manufactured and sold by private
respondent.
We find no merit in his arguments. The question of whether petitioner was manufacturing and
selling power tillers is a question of fact better addressed to the lower courts. In dismissing the
first argument of petitioner herein, the Court of Appeals quoted the findings of the court, to wit:
It is the contention of defendant that he did not manufacture or make imitations or copies of
plaintiff's turtle power tiller as what he merely did was to fabricate his floating power tiller upon
specifications and designs of those who ordered them. However, this contention appears
untenable in the light of the following circumstances: 1) he admits in his Answer that he has
been manufacturing power tillers or hand tractors, selling and distributing them long before
plaintiff started selling its turtle power tiller in Zamboanga del Sur and Misamis Occidental,
meaning that defendant is principally a manufacturer of power tillers, not upon specification and
design of buyers, but upon his own specification and design; 2) it would be unbelievable that
defendant would fabricate power tillers similar to the turtle power tillers of plaintiff upon
specifications of buyers without requiring a job order where the specification and designs of
those ordered are specified. No document was (sic) ever been presented showing such job
orders, and it is rather unusual for defendant to manufacture something without the specification
and designs, considering that he is an engineer by profession and proprietor of the Ozamis

Engineering shop. On the other hand, it is also highly unusual for buyers to order the fabrication
of a power tiller or hand tractor and allow defendant to manufacture them merely based on their
verbal instructions. This is contrary to the usual business and manufacturing practice. This is not
only time consuming, but costly because it involves a trial and error method, repeat jobs and
material wastage. Defendant judicially admitted two (2) units of the turtle power tiller sold by
him to Policarpio Berondo. 5
Of general acceptance is the rule imbedded in our jurisprudence that ". . . the jurisdiction of the
Supreme Court in cases brought to it from the Court of Appeals in a petition for certiorari under
Rule 45 of the Rules of Court is limited to the review of errors of law, and that said appellate
court's findings of fact are conclusive upon this Court." 6
The fact that petitioner herein manufactured and sold power tillers without patentee's authority
has been established by the courts despite petitioner's claims to the contrary.
The question now arises: Did petitioner's product infringe upon the patent of private respondent?
Tests have been established to determine infringement. These are (a) literal infringement; and
(b) the doctrine of equivalents. 7 In using literal infringement as a test, ". . . resort must be had, in
the first instance, to the words of the claim. If accused matter clearly falls within the claim,
infringement is made out and that is the end of it." 8 To determine whether the particular item
falls within the literal meaning of the patent claims, the court must juxtapose the claims of the
patent and the accused product within the overall context of the claims and specifications, to
determine whether there is exact identity of all material elements. 9
The trial court made the following observation:
Samples of the defendant's floating power tiller have been produced and inspected by the court
and compared with that of the turtle power tiller of the plaintiff (see Exhibits H to H-28). In
appearance and form, both the floating power tillers of the defendant and the turtle power tiller
of the plaintiff are virtually the same. Defendant admitted to the Court that two (2) of the power
inspected on March 12, 1984, were manufactured and sold by him (see TSN, March 12, 1984, p.
7). The three power tillers were placed alongside with each other. At the center was the turtle
power tiller of plaintiff, and on both sides thereof were the floating power tillers of defendant
(Exhibits H to H-2). Witness Rodrigo took photographs of the same power tillers (front, side, top
and back views for purposes of comparison (see Exhibits H-4 to H-28). Viewed from any
perspective or angle, the power tiller of the defendant is identical and similar to that of the turtle
power tiller of plaintiff in form, configuration, design and appearance. The parts or components
thereof are virtually the same. Both have the circularly-shaped vacuumatic housing float, a
paddy in front, a protective water covering, a transmission box housing the transmission gears, a
handle which is V-shaped and inclined upwardly, attached to the side of the vacuumatic housing
float and supported by the upstanding G.I. pipes and an engine base at the top midportion of the
vacuumatic housing float to which the engine drive may be attached. In operation, the floating
power tiller of the defendant operates also in similar manner as the turtle power tiller of plaintiff.
This was admitted by the defendant himself in court that they are operating on the same
principles. (TSN, August 19, 1987, p. 13) 10
Moreover, it is also observed that petitioner also called his power tiller as a floating power tiller.
The patent issued by the Patent Office referred to a "farm implement but more particularly to a
turtle hand tractor having a vacuumatic housing float on which the engine drive is held in place,
the operating handle, the harrow housing with its operating handle and the paddy wheel

protective covering." 11 It appears from the foregoing observation of the trial court that these
claims of the patent and the features of the patented utility model were copied by petitioner. We
are compelled to arrive at no other conclusion but that there was infringement.
Petitioner's argument that his power tillers were different from private respondent's is that of a
drowning man clutching at straws.
Recognizing that the logical fallback position of one in the place of defendant is to aver that his
product is different from the patented one, courts have adopted the doctrine of equivalents
which recognizes that minor modifications in a patented invention are sufficient to put the item
beyond the scope of literal infringement. 12 Thus, according to this doctrine, "(a)n infringement
also occurs when a device appropriates a prior invention by incorporating its innovative concept
and, albeit with some modification and change, performs substantially the same function in
substantially the same way to achieve substantially the same result." 13 The reason for the
doctrine of equivalents is that to permit the imitation of a patented invention which does not
copy any literal detail would be to convert the protection of the patent grant into a hollow and
useless thing. Such imitation would leave room for indeed encourage the unscrupulous
copyist to make unimportant and insubstantial changes and substitutions in the patent which,
though adding nothing, would be enough to take the copied matter outside the claim, and hence
outside the reach of the law. 14
In this case, the trial court observed:
Defendant's witness Eduardo Caete, employed for 11 years as welder of the Ozamis
Engineering, and therefore actually involved in the making of the floating power tillers of
defendant tried to explain the difference between the floating power tillers made by the
defendant. But a careful examination between the two power tillers will show that they will
operate on the same fundamental principles. And, according to establish jurisprudence, in
infringement of patent, similarities or differences are to be determined, not by the names of
things, but in the light of what elements do, and substantial, rather than technical, identity in the
test. More specifically, it is necessary and sufficient to constitute equivalency that the same
function can be performed in substantially the same way or manner, or by the same or
substantially the same, principle or mode of operation; but where these tests are satisfied, mere
differences of form or name are immaterial. . . . 15
It also stated:
To establish an infringement, it is not essential to show that the defendant adopted the device or
process in every particular; Proof of an adoption of the substance of the thing will be sufficient.
"In one sense," said Justice Brown, "it may be said that no device can be adjudged an
infringement that does not substantially correspond with the patent. But another construction,
which would limit these words to exact mechanism described in the patent, would be so
obviously unjust that no court could be expected to adopt it. . . .
The law will protect a patentee against imitation of his patent by other forms and proportions. If
two devices do the same work in substantially the same way, and accomplish substantially the
same result, they are the same, even though they differ in name, form, or shape. 16
We pronounce petitioner liable for infringement in accordance with Section 37 of Republic Act No.
165, as amended, providing, inter alia:

Sec. 37. Right of Patentees. A patentee shall have the exclusive right to make, use and sell the
patented machine, article or product, and to use the patented process for the purpose of industry
or commerce, throughout the territory of the Philippines for the terms of the patent; and such
making, using, or selling by any person without the authorization of the Patentee constitutes
infringement of the patent. (Emphasis ours)
As far as the issue regarding unfair competition is concerned, suffice it to say that Republic Act
No. 166, as amended, provides, inter alia:
Sec. 29. Unfair competition, rights and remedies. . . .
xxx xxx xxx
In particular, and without in any way limiting the scope of unfair competition, the following shall
be deemed guilty of unfair competition:
(a) Any person, who in selling his goods shall give them the general appearance of goods of
another manufacturer or dealer, either as to the goods themselves or in the wrapping of the
packages in which they are contained, or the devices or words thereon, or in any other feature of
their appearance, which would be likely to influence purchasers 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. . . .
xxx xxx xxx
Considering the foregoing, we find no reversible error in the decision of the Court of Appeals
affirming with modification the decision of the trial court.
WHEREFORE, premises considered, the decision of the Court of Appeals is hereby AFFIRMED and
this petition DENIED for lack of merit.
Cresser Precision Systems v. CA - Only the patentee may file for infringement. There can be no
infringement of a patent until a patent has been issued since whatever right one has to the
invention conferred by the patent arises alone from a grant of patent.
Smith Kline v. CA - Article 5 of the Paris Convention unequivocally and explicitly respects the
right of the member countries to adopt legislative measures to provide for grant of compulsory
licenses to prevent abuses which might result from the exercise of the exclusive rights conferred
by the patent.
Smith Kline Beckman v. CA - The doctrine of equivalents thus requires satisfaction of the
functions-means-and-result test, the patentee having the burden to show that all three
components of such equivalency test are met.
Godinez v. CA - Tests to determine infringement are; 1) Doctrine of Literal Infringement 2)
Doctrine of Equivalents. The reason for thedoctrine of equivalents is that to permit the imitation
of a patented invention which does not copy any literal detail would be to convert the protection
of the patent grant into hollow and useless thing.
Manzano v. CA - There is a presumption that the Philippine Patent 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.

Maguan v. CA - An invention must possess the essential elements of novelty, originality, and
precedence and for the patentee to beentitled to protection, the invention must be new to the
world. A single instance of public use of the invention by a patentee for more than two years(now
more than 1 year under Sec.9 of Patent Law) before the date of application for his patent will be
fatal to the validity of the patent when issued.

MAGUAN V CA
Principle in the case: 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.
FACTS: Maguan is doing business under the firm name and style of SWAN MANUFACTURING"
while Luchan is likewise doing business under the firm name and style of "SUSANA LUCHAN
POWDER PUFFMANUFACTURING.Maguan informed Luchan that the powder puffs Luchan is
manufacturing and selling to various enterprises particularly those in the cosmetics industry,
resemble Identical or substantially Identical powder puffs of which she (Maguan) is a patent
holder under Registration Certification Nos. Extension UM-109, ExtensionUM-110 and Utility
Model No. 1184; Maguan 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. Luchan replied stating that her products are different and countered that
Maguans 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. Maguan filed a complaint for damages with injunction and
preliminary injunction against Luchan with the then Court of First Instance of Rizal. The trial court
issued an Order granting the preliminary injunction prayed for. Consequently, the corresponding
writ was subsequently issued.
Issue: WON in Maguan has a right to file an action before the CFI for injunction due to
infringement of her patent.
Ruling: Yes. Rationale: 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.
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.

McDonald's Corporation v. L.C. Big Mak Burger, Inc.

Petitioner McDonald's Corporation ("McDonald's") is a US corporation that operates a global chain
of fast-food restaurants, with Petitioner McGeorge Food Industries ("McGeorge"), as the Philippine
franchisee.
McDonald's owns the "Big Mac" mark for its "double-decker hamburger sandwich." with the US
Trademark Registry on 16 October 1979.
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 IPO). On 18 July 1985, the PBPTT allowed registration of the "Big Mac."
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.
On 21 October 1988, respondent corporation applied with the PBPTT for the registration of the
"Big Mak" mark for its hamburger sandwiches, which was opposed by McDonald's. McDonald's
also informed LC Big Mak chairman 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, petitioners sued L.C. Big Mak Burger, Inc. and its directors before
Makati RTC Branch 137 ("RTC"), for trademark infringement and unfair competition.
RTC rendered a Decision finding respondent corporation liable for trademark infringement and
unfair competition. CA reversed RTC's decision on appeal.
1ST ISSUE:W/N respondent corporation is liable for trademark infringement and unfair
competition.
Ruling: Yes
Section 22 of Republic Act No. 166, as amended, defines trademark infringement as follows:
Infringement, what constitutes. - Any person who [1] 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 [2] reproduce, counterfeit, copy, or colorably imitate any such mark or tradename 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.

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.
1st element:
A mark is valid if it is distinctive and not merely generic and descriptive.
The "Big Mac" mark, which should be treated in its entirety and not dissected word for word, is
neither generic nor descriptive. Generic marks are commonly used as the name or description of
a kind of goods, such as "Lite" for beer. Descriptive marks, on the other hand, convey the
characteristics, functions, qualities or ingredients of a product to one who has never seen it or
does not know it exists, such as "Arthriticare" for arthritis medication. On the contrary, "Big Mac"
falls under the class of fanciful or arbitrary marks as it bears no logical relation to the actual
characteristics of the product it represents. As such, it is highly distinctive and thus valid.
2nd element:
Petitioners have duly established McDonald's exclusive ownership of the "Big Mac" mark. Prior
valid registrants of the said mark had already assigned his rights to McDonald's.
3rd element:
Section 22 covers two types of confusion arising from the use of similar or colorable imitation
marks, namely, confusion of goods (confusion in which the ordinarily prudent purchaser would be
induced to purchase one product in the belief that he was purchasing the other) and confusion of
business (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).
There is confusion of goods in this case since respondents used the "Big Mak" mark on the same
goods, i.e. hamburger sandwiches, that petitioners' "Big Mac" mark is used.
There is also confusion of business due to Respondents' use of the "Big Mak" mark in the sale of
hamburgers, the same business that petitioners are engaged in, also results in confusion of
business. 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 registered trademark owner enjoys protection
in product and market areas that are the normal potential expansion of his business.
Furthermore, In determining likelihood of confusion, the SC has relied on the dominancy test
(similarity of the prevalent features of the competing trademarks that might cause confusion)
over the holistic test (consideration of the entirety of the marks as applied to the products,
including the labels and packaging).
Applying the dominancy test, Respondents' use of the "Big Mak" mark results in likelihood of
confusion. Aurally the two marks are the same, with the first word of both marks phonetically the

same, and the second word of both marks also phonetically the same. Visually, the two marks
have both two words and six letters, with the first word of both marks having the same letters
and the second word having the same first two letters.
Lastly, since Section 22 only requires the less stringent standard of "likelihood of confusion,"
Petitioners' failure to present proof of actual confusion does not negate their claim of trademark
infringement.
2ND ISSUE: W/N Respondents committed Unfair Competition
Ruling: Yes.
Section 29 ("Section 29")73 of RA 166 defines unfair competition, thus:
Any person who will 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.
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.
In the case at bar, Respondents have applied on their plastic wrappers and bags almost the
same words that petitioners use on their styrofoam box. Further, Respondents' goods are
hamburgers which are also the goods of petitioners. Moreover, there is actually no notice to the
public that the "Big Mak" hamburgers are products of "L.C. Big Mak Burger, Inc." This clearly
shows respondents' intent to deceive the public.

Del Monte vs Court of Appeals and Sunshine Sauce

Del Monte Corporation is an American corporation which is not engaged in business in the
Philippines. Though not engaging business here, it has given authority to Philippine Packing
Corporation (Philpack) the right to manufacture, distribute and sell in the Philippines various
agricultural products, including catsup, under the Del Monte trademark and logo. In 1965, Del
Monte also authorized Philpack to register with the Patent Office the Del Monte catsup bottle
configuration. Philpack was issued a certificate of trademark registration under the Supplemental
Register.
Later, Del Monte and Philpack learned that Sunshine Sauce Manufacturing was using Del Monte
bottles in selling its products and that Sunshine Sauces logo is similar to that of Del Monte. The
RTC of Makati as well as the Court of Appeals ruled that there was no infringement because the
trademarks used between the two are different in designs and that the use of Del Monte bottles
by Sunshine Sauce does not constitute unfair competition because as ruled in Shell Company vs
Insular Petroleum: selling oil in containers of another with markings erased, without intent to
deceive, was not unfair competition.
ISSUE: Whether or not there is unfair competition and infringement in the case at bar.

HELD: Yes. The Supreme Court recognizes that there really are distinctions between the designs
of the logos or trademarks of Del Monte and Sunshine Sauce. However, it has been that side
by side comparison is not the final test of similarity. Sunshine Sauces logo is a colorable
imitation of Del Montes trademark. 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. 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.
The Supreme Court also ruled that Del Monte does not have the exclusive right to use Del Monte
bottles in the Philippines because Philpacks patent was only registered under the Supplemental
Register and not with the Principal Register. Under the law, registration under the Supplemental
Register is not a basis for a case of infringement because unlike registration under the Principal
Register, it does not grant exclusive use of the patent. However, the bottles of Del Monte do say
in embossed letters: Del Monte Corporation, Not to be Refilled. And yet Sunshine Sauce refilled
these bottles with its catsup products. This clearly shows the Sunshine Sauces bad faith and its
intention to capitalize on the Del Montes reputation and goodwill and pass off its own product as
that of Del Monte.

Solid Triangle Sales Corporation vs the Sheriff of RTC QC

FACTS: Judge Bruselas,Jr., Presiding Judge of RTC, Quezon City, upon application of the Economic
Intelligence and Investigation Bureau(EIIB), issued a search warrant against herein private
respondent Sanly Corporation for violation of Sec. 168 of R.A No. 8293 for unfair competition.
The private respondent corporation contends that there is no unfair competition being
committed since the products that he sells, particularly Mitsubishi photographic color paper, are
genuine products of Mitsubishi that he buys from Hong Kong while the complainant purchases
the same kind of paper from Japan.
ISSUE: whether or not there was probable cause that the crime of unfair competition under the
IPC Code has been committed by the respondents?
HELD: No. The SC disagreed with petitioners and find that the evidence presented before the
trial court does not prove unfair competition under Section 168 of the Intellectual Property
Code.
Under SEC. 168. Unfair Competition, Rights, Regulation and Remedies. 168.1 A person who has
identified in the mind of the public 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 of 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.
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 ofered
are those of a manufacturer or dealer, other than the actual manufacturer or dealer, or who
otherwise clothes the goods with such appearance as shall deceive the public and defraud
another of his legitimate trade, or any subsequent vendor of such goods or any agent of any
vendor engaged in selling such goods with a lie 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 ofering the service 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.
Sanly Corporation did not pass off the subject goods as that of another. Indeed, it admits that
the goods are genuine Mitsubishi photographic paper, which it purchased from a supplier in Hong
Kong. Petitioners also allege that private respondents made it appear that they were duly
authorized to sell or distribute Mitsubishi Photo Paper in the Philippines. Assuming that this act
constitutes a crime, there is no proof to establish such an allegation.

KENNETH ROY SAVAGE/K ANGELIN EXPORT TRADING VS. TAYPIN

FACTS: Petitioners Savage, seek to nullify the search warrant issued by respondent Judge
Aproniano B. Taypin of the Regional Trial Court, Br. 12 Cebu City, which resulted in the seizure of
certain pieces of wrought iron furniture from the factory of petitioners located in Biasong,
Talisay, Cebu.
The complaint was lodged by private respondent Eric Ng Mendoza, president and general
manager of Mendco Development Corporation (MENDCO), alleging that Savages products are
the object of unfair competition involving design patents, punishable under Art. 189 of the
Revised Penal Code as amended. Savage contends however, that there was no existence of
offense leading to the issuance of a search warrant and eventual seizure of its products.
ISSUE: Whether or not unfair competition involving design patents are punishable under Article
189 of the Revised Penal Code.

HELD: To provide a clear view, the Intellectual Property Code took effect on January 1, 1998. The
repealing clause of the IPC provides that Articles 188 and 189 of the Revised Penal Code (RPC),
Presidential Decree No. 49, are hereby repealed The issue involving the existence of "unfair
competition" as a felony involving design patents, referred to in Art. 189 of the Revised Penal
Code, has been rendered moot and academic by the repeal of the article. Hence, the search
warrant cannot even be issued by virtue of a possible violation of the IPR Code.
There is no mention of any crime of "unfair competition" involving design patents in the
controlling provisions on Unfair Competition of the RPC. It is therefore unclear whether the crime
exists at all, for the enactment of RA 8293 did not result in the reenactment of Art. 189 of the
Revised Penal Code.
The court is are prevented from applying these principles, along with the new provisions on
Unfair Competition found in the IPR Code, to the alleged acts of the petitioners, for such acts
constitute patent infringement as defined by the same Code
Although the case traces its origins to the year 1997 or before the enactment of the IPR Code,
Article 22 of the Revised Penal Code provides that penal laws shall be applied retrospectively, if
such application would be beneficial to the accused. Since the IPR Code effectively obliterates
the possibility of any criminal liability attaching to the acts alleged, then RPC provisions must be
applied.

CHING VS SALINASG.R. No. 161295 June 29, 2005FACTS:

FACTS:
Jessie G. 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. On September 4, 2001, 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."
After due investigation, the NBI filed applications for search warrants in the RTC of Manila against
William Salinas, Sr. and the officers and members of the Board of Directors of Wilaware Product
Corporation. It was alleged that the respondents therein reproduced and distributed the said
models penalized under Sections 177.1 and 177.3of Republic Act (R.A.) No.
8293. 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.
ISSUE:
WON the Leaf Spring Eye Bushing for Automobile is a work of art
HELD:

No copyright granted by law can be said to arise in favor of the petitioner despite the issuance of
the certificates of copyright registration and the deposit of the Leaf Spring Eye Bushing and
Vehicle Bearing Cushion.
RATIO RECIDENDI:
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. A utility model is a technical
solution to a problem in any field of human activity which is new and industrially applicable. It
may be, or may relate to, a product, or process, or an improvement of any of the aforesaid.
Essentially, a utility model refers to an invention in the mechanical field. This is the reason why
its object is sometimes described as a device or useful object. A utility model varies from an
invention, for which a patent for invention is, likewise, available, on at least three aspects: first,
the requisite of "inventive step" in a patent for invention is not required; second, the
maximum term of protection is only seven years compared to a patent which is twenty years,
both reckoned from the date of the application; and third, the provisions
on utility model dispense with its substantive examination and prefer for a less complicated
system. Being plain automotive spare parts that must conform to the original structural design of
the components they seek to replace, 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.