G.R.
L-24919 January 28, 1980
JAMES HOWARD BOOTHE and JOHN MORTON, II, petitioners,
vs.
THE DIRECTOR OF PATENTS, respondent.
Picazo & Agcaoili for petition.
Office of the Solicitor General for respondent.
MELENCIO-HERRERA, J.:
Sought to be reviewed herein is the Decision of the Director of Patents, dated
December 9, 1964, denying priority rights under section 15 of our Patent Law
(Republic Act No. 165) to petitioners, as foreign applicants for Letters Patent, for
their invention of "Chemotherapeutic Materials and Methods of Preparing the same.
Petitioners James Howard Boothe and John Morton II, chemists, citizens and
residents of the United States, claim to be the inventors of a new antibiotic
designated as "tetracycline", a new derivative of chlortetracycline (popularly known
as "aureomycin")
On February 19, 1954, petitioners applied for Letters Patent covering said invention
to respondent Director of Patents claiming the right of priority granted to foreign
applicants under section 15 of the Patent Law (RA 165). Receipt of petitioners'
application was acknowledged by respondent Director on March 6, 1954.
On April 14, 1954, petitioners filed with respondent Director a legalized copy of
their Application for Letters Patent in the United States for the same invention (U.S.
Serial No. 342556). Said legalized copy indicated that the application in the United
States was filed on March 16, 1963. 1 This latter date is of crucial importance to
petitioners' cause under section 15 of the Patent Law, which provides that:
Section 15. Application previously filed abroad. — An application
for patent for an invention filed in this country by any person who
has previously regularly filed an application for a patent for the
same invention in a foreign country, which by treaty, convention or
law affords similar privileges to citizens of the Philippines, shall
have the same force and effect as the same application would have
if filed in this country on the date on which the application for
patent for the same invention was first filed in such foreign
country: Provided, That the application in this country is filed
within twelve months from the earliest date on which such foreign
application was filed and a certified copy of the foreign application
together with a translation thereof into English, if not in the
English language, is filed within six months from the date of filing
in the Philippines, unless the Director for good cause shown shall
extend the time for filing such certified copy: And provided,
further, that no patent shall be granted on an application for patent
for an invention which had been patented or described in a printed
publication in this or any foreign country more than one year
before the date of the actual filing of the application in this
country, or which had been in public use or sale in this country for
more than one year prior to such filing.
Under the foregoing provision, petitioners would be entitled to the priority date of
March 16, 1953 if their application is considered filed in the Philippines as of March
5, 1954, since the latter date would fall within the one-year period prior to March 5,
1954.
On February 7, 1958, petitioners informed respondent Director that in interference
proceedings in the United States, Letters Patent for a similar invention as theirs was
awarded to Pfizer and Co., which had filed its application ahead and that they failed
to obtain any U.S. patent for their own invention. Petitioners, however, observed and
requested:
In the Philippines, however, the situation is at least the reverse.
Pfizer and Co. did not file or else filed an application after the
above application has already been filed. The said above
application therefore is good and valid.
We request, therefore, that the present application be granted on
the basis of the claims originally filed. 2
On August 5, 1959, in Paper No. 6, 3 Patent Examiner, Lydia Nueva España, rejected
all of petitioners' claims in view of "Philippine Patent No. 254 — November 29,
1956", apparently referring to a local Patent obtained by Pfizer and Co., presumably
covering the same invention. Additionally, petitioners were advised that the
"Specification" they had submitted was "incomplete" and that responsive action
should be filed them four months from date of mailing, which was also August 5,
1959. Paper No. 6 precipitated a series of communications between the
aforementioned Patent Examiner and petitioners, who apparently failed to meet the
deadline of four months for filing their responsive action.
On October 9, 1961, petitioners requested for clarification of Paper No. 6,
particularly as to why their Specification was considered incomplete.
In response, Supervising Patent Examiner Nelia de Castro informed petitioners as
follows:
With respect to applicant's request for clarification as to the
meaning of the second to the last sentence contained in Paper 6,
attention is called to the fact that the specification which was
originally filed is incomplete and not in accordance with Rule 62
of the Revised Rules. Said specification ends on Page 9 with the
incomplete sentence "The refractive indices of this crystalline
phase were found —
It appears from further from a comparison between the submitted 9
pages of the specification and 2 pages of the claims on one hand
and the corresponding pages of the legalized copy of the U.S.
application on the other that the present application does not
correspond with the said certified copy of the U.S. Application.
The present application cannot therefore be granted priority date
under section 15 are requested by applicant. 4
On July 3, 1962, petitioners submitted two complete copies of the Specification,
which included nine additional pages, and reiterated their request for priority right in
the Philippines. 5
On October 2, 1962, Chief Patent Examiner Nicanor Mapili issued Paper No. 20
rejecting the additional nine pages of Specification submitted by petitioners, and
ruling:
xxx xxx xxx
The filing of the alleged complete copy Of the specification is an
attempt to effect a remedy to the previous finding of
incompleteness as stated in the 2nd to the last paragraph of Office
Action mailed Aug. 5, 1959, marked Paper 6. This cannot be
allowed inasmuch as 9 pages of new matter are actually proposed
to be added to the specification.
This action is made final for purpose of appeal 6
Petitioners moved for reconsideration on the ground that their application falls under
the exception provided for in Rule 47 of the Revised Rules of Practice in Patent
Cases in that the missing nine pages submitted by them are not really new matter but
a mere "minor informality."
On February 5, 1963, Chief Patent Examiner Mapili issued Paper No. 22 denying
petitioners' Motion for Reconsideration and the findings of Examiner de Castro as
follows:
The basis of the examiner's finding is applicant's verification on
file, exclusive of what is in an alleged corresponding application in
the US as evidenced by a certified copy of record. The only use of
such certified a copy is to give proof to an earlier filing date as
provided for such section 15 of the Patent Law and to use the
inventors' oath therein to complete the form requirements relative
to his application in a dance with the provisions of section 13(3) of
the same law.
The provisions of section 15 of the Patent Law, under which the
present application was filed, provides for a for filing. This
deadline cannot be extended directly or indirectly by the filing of
an imperfect application which can be freely amended or rectified
at a later date. If this can be done legally, the restrictive provisions
of section 15 will be nullified. 7
Adversely affected, petitioners appealed to dent Director of Patents.
In their Brief filed with respondent Directors petitioners prayed for 1) revocation of
the of the Chief Patent Examiner, 8 2) admission of their Specification submitted on
July 3, 1962; and 3) allowance of their application on the merits.
On December 9, 1964, respondent Director rendered the questioned Decision, the
dispositive portion of which reads:
WHEREFORE, the appeal is hereby sustained. The additional
pages to the specification are hereby admitted, but the application
shall not be extended priority rights under section 15 of the Patent
Law. Let the filing date of this application be changed from March
5, 1954 to April 14, 1954. The application is hereby remanded to
the Chief Patent Examiner for proper action and for further
examination on the merits. 9
In reaching the foregoing conclusion, respondent Director opined that the portions
subsequently supplied in the local application are not new matter a comparison
between the foreign and local applications showed that the foreign application
included the missing portions of the local one. However, respondent Direct qualified
that petitioners' application may be considered complete only on April 14, 1954
when the certified copy of the foreign application was submitted. Consequently, the
instant application is to be considered an ordinary application, not entitled to the
right of priority granted by section 15 of the Patent Law, inasmuch as said
application was not complete within the meaning of Rules 47 and 48 of the Revised
Rules of Practice in Patent Case when first filed on March 5, 1954.
Petitioners filed a Motion for Partial Reconsideration of the above-mentioned
Decision questioning that portion of respondent Director's ruling barring them from
entitlement to the right of priority under section 15 of the Patent Law contending that
their appeal centered merely on the issue of whether or not the additional nine pages
of Specification they had submitted should be treated as new matter.
On June 10, 1965, respondent Director denied reconsideration for lack of merit, and
explained:
... It should be emphasized that under Rule 262 (b) of the Revised
Rules of Practice in Patent Cases, it is stated that should the
Director have any knowledge of any ground not involved in the
appeal for rejecting any claim, he may include in his decision a
statement to that effect with his reasons for so holding, which
statement shall constitute a rejection of the claim. Priority claims
are covered by the rule: 10
On June 11, 1965, petitioners filed a Second Motion for reconsideration on the
ground that priority rights are governed by convention and treaty, while invention
claims are governed exclusively by the Statute and Rules of Practice. Respondent
Director denied that Motion for lack of merit on August 24, 1965.
Hence, this recourse.
On January 9, 1967, we deemed the case submitted for decision, after petitioners had
filed their Brief on February 12, 1966, and respondent Director, through the Solicitor
General, his Brief on June 9, 1966.
On June 9, 1968, Republic Act No. 5434 was enacted providing that final Orders and
Decisions of the Director of Patents in ex parte and inter partes proceedings are
appealable to the Court of Appeals. Since no provision for retroactivity exists in said
Act this Tribunal has resolved to retain jurisdiction over this case.
Petitioners maintain before this Court that:
RESPONDENT DIRECTOR OF PATENTS ERRED IN
HOLDING THAT PETITIONERS' APPLICATION, SERIAL NO.
952, MAY NOT BE TREATED AS FILED UNDER SECTION 15
AS AMENDED, OF REPUBLIC ACT NO. 165 KNOWN AS
THE PATENT LAW.
and in support thereof stress that:
1) The Director had no jurisdiction to decide the question of
whether or not the Philippine Application should be treated as filed
under Section 15 of the Act;
2) The Director had no jurisdiction to decide the question of
whether or not the Philippine Application was incomplete under
Rules 47 and 48 of the Revised Rules of Practice in Patent Cases;
3) The Director misconstrued and misapplied Rules 47 and 48 of
the Rules;
4) The Director misconstrued and misapplied Rule 262 (b) of the
Rules.
For resolution, therefore, are the following issues: the scope of the powers of the
Director of Patents in cases appealed to him and the correctness of his application of
Rules 47, 48 and 262(b) of the Revised Rules of Practice in Patent Cases.
The facts unfolded call for an affirmance of respondent Director's rulings.
Explicit in Rule 262 of the Revised Rules of Practice in Patent Cases is the power
and authority of respondent Director to decide petitioners' appeal in the manner that
he did, and we quote:
262. Decision by the Director. — (a) The Director, in his decision,
may affirm or reverse the decision of the Principal Examiner in
whole or in part on the ground and on the claims specified by the
Examiner. The affirmance of the rejection of a claim on any of the
grounds specified constitutes a general affirmance of the decision
of the Principal Examiner on that claim, except as to any ground
specifically reversed.
(b) Should the Director have knowledge of any grounds not
involved in the appeal for rejecting any claim he may include in his
decision a statement to that effect with his reasons for so holding
which statement shall constitute a rejection of the claims. ...
In other words, respondent Director is empowered to consider grounds which may
have come to his knowledge other than those specifically raised in an appeal He need
not confine himself only to issues invoked. Besides, the question of new matter is
inextricably linked with the right of priority on which petitioners have anchored their
application. As early as Paper No. 18, supra, the Supervising Patent Examiner had
concluded that inasmuch as the submitted pages did not correspond with the certified
copy of the U.S. application, "the present application cannot therefore be granted
priority date under section 16 as requested by applicant." Again, in Paper No.
22, supra, the Chief Patent Examiner made mention of petitioner' imperfect
application and the fact that the deadline for filinf required by section 15 of the
Patent Law cannot be extended directly or indirectly otherwise "the restrictive
provisions of section 15 will be nullified."
It is also far-fetched for petitioners to claim that in ruling on petitioners' right of
priority, respondent Director had contravened Rule 254 of the Revised Rules of
Practice in Patent cases, which provides that the Director of Patents exercises no
direct control, direction and supervision over the Principal Examiner and the
Executive Examiner. What respondent Director exercised was his authority to review
the decisions of Patent Examiners, as explicitly provided for in the last paragraph of
the same Rules 254, as follows:
xxx xxx xxx
The only supervision which the Director of Patent may lawfully
exercise over the Principal Examiners and the Executive Examiner
is a general supervision, exercised through a review of the
recommendations they may make for the grant of a patent, and
through a review of their decision by petition and appeal.
Similarly untenable is petitioners' contention that respondent Director had
misconstrued and misapplied Rules 47 and 48 of the Revised Rules of Practice in
Patent Cases. The said Rules provide:
47. Application accepted and filed for examination only w hen
complete — An application for an invention patent will not be
accepted and placed upon the files for examination until all its
required parts, complying with the rules relating thereto are
received except that 'certain minor informalities may be waived
subject to subsequent correction, whenever required.
If the papers and parts are incomplete, or so defective that they
cannot be accepted as a complete application for examination, the
applicant will be notified; the papers will be held four months for
completion and if not by then completed, will be stored as an
abandoned incomplete application and eventually destroyed or
otherwise disposed of.
48. Serial number and filing date of application — Complete
applications are numbered in regular order, and the applicant win
be informed of the serial number and filing date of the application
by a filing receipt. The filing date of the applicant is the, date on
which the complete application, acceptable for placing on the files
for examination, is received in the Patent Office; or the date on
which the last part completing such application is received, in the
case of an incomplete or defective application completed within
four months. The Executive Examiner shall be in charge of fixing
the filing date and serial number of an application.
Under the aforecited provisions, it is imperative that the application be complete in
order that it may be accepted. It is essential to the validity of Letters Patent that the
specifications be full, definite, and specific. 11 The purpose of requiring a definite
and accurate description of the process is to apprise the public of what the patentee
claims as his invention, to inform the Courts as to what they are called upon to
construe, and to convey to competing manufacturers and dealers information of
exactly what they are bound to avoid. 12
The specification which petitioners submitted on March 5, 1954 was far from
complete. That defect was one of substance and not merely one of form. What
petitioners claimed as their invention was not completely determinable therefrom.
Petitioners' application could be deemed as complete only on July 2, 1963 when they
submitted the additional pages on the Specifications and Claims. Respondent
Director, therefore, did not err in converting petitioners' application into an ordinary
application filed on April 14, 1954, not only for their having failed to complete their
application within the four-month period provided for by Rules 47 and 48, Revised
Rules of Practice in Patent Cases, and as required of them by Paper No. 6, but also
for their having failed to file a complete application within twelve months from
March 16, 1953, the date of the foreign application For, to be entitled to the filing
date of the patent application, an invention disclosed in a previously filed application
must be described within the instant application in such a manner as to enable one
skilled in the art to use the same for a legally adequate utility. 13
All told, we sustain respondent Director's findings in the absence of error or abuse of
power or lack of jurisdiction or grave abuse of discretion. 14 We have held that in the
absence of arbitrariness, and provided they are supported by substantial evidence, as
in this case, the conclusions reached by the Director of Patents are to be accorded
respect and must be upheld. 15
WHEREFORE, we hereby affirm the Decision of respondent Director of Patents
dated December 9, 1964.
SO ORDERED.
 SECOND DIVISION formula IA. The scope of the claims of the Patent extends to a
combination of penicillin such as ampicillin sodium and beta-
lactam antibiotic like sulbactam sodium.
PHIL PHARMAWEALTH, INC., G.R. No. 167715
Petitioner, 7. Patent No. 21116 thus covers ampicillin sodium/sulbactam
Present: sodium (hereafter Sulbactam Ampicillin). Ampicillin sodium is a
specific example of the broad beta-lactam antibiotic disclosed and
CARPIO, J., Chairperson, claimed in the Patent. It is the compound which efficacy is being
- versus - NACHURA, enhanced by co-administering the same with sulbactam sodium.
PERALTA, Sulbactam sodium, on the other hand, is a specific compound of
ABAD, and the formula IA disclosed and claimed in the Patent.
MENDOZA, JJ.
8. Pfizer is marketing Sulbactam Ampicillin under the brand name
Promulgated: Unasyn. Pfizer's Unasyn products, which come in oral and IV
PFIZER, INC. and PFIZER (PHIL.) INC., formulas, are covered by Certificates of Product Registration
Respondents. November 17, 2010 (CPR) issued by the Bureau of Food and Drugs (BFAD) under the
name of complainants. The sole and exclusive distributor of
Unasyn products in the Philippines is Zuellig Pharma Corporation,
pursuant to a Distribution Services Agreement it executed with
Pfizer Phils. on January 23, 2001.

x--------------------------------------------------x 9. Sometime in January and February 2003, complainants came to

DECISION
PERALTA, J.:
Before the Court is a petition for review on certiorari seeking to annul and set aside
the Resolutions dated January 18, 2005[1] and April 11, 2005[2] by the Court of
Appeals (CA) in CA-G.R. SP No. 82734.
The instant case arose from a Complaint[3] for patent infringement filed against
petitioner Phil Pharmawealth, Inc. by respondent companies, Pfizer, Inc. and Pfizer
(Phil.), Inc., with the Bureau of Legal Affairs of the Intellectual Property Office
(BLA-IPO). The Complaint alleged as follows:
xxxx
6. Pfizer is the registered owner of Philippine Letters Patent No.
21116 (the Patent) which was issued by this Honorable Office on
July 16, 1987. The patent is valid until July 16, 2004. The claims
of this Patent are directed to a method of increasing the
effectiveness of a beta-lactam antibiotic in a mammalian subject,
which comprises co-administering to said subject a beta-lactam
antibiotic effectiveness increasing amount of a compound of the
know that respondent [herein petitioner] submitted bids for the
supply of Sulbactam Ampicillin to several hospitals without the
consent of complainants and in violation of the complainants'
intellectual property rights. x x x
xxxx
10. Complainants thus wrote the above hospitals and demanded
that the latter immediately cease and desist from accepting bids for
the supply [of] Sulbactam Ampicillin or awarding the same to
entities other than complainants. Complainants, in the same letters
sent through undersigned counsel, also demanded that respondent
immediately withdraw its bids to supply Sulbactam Ampicillin.
11. In gross and evident bad faith, respondent and the hospitals
named in paragraph 9 hereof, willfully ignored complainants' just,
plain and valid demands, refused to comply therewith and
continued to infringe the Patent, all to the damage and prejudice of
complainants. As registered owner of the Patent, Pfizer is entitled
to protection under Section 76 of the IP Code.
x x x x[4]
Respondents prayed for permanent injunction, damages and the forfeiture and
impounding of the alleged infringing products. They also asked for the issuance of a
temporary restraining order and a preliminary injunction that would prevent herein
petitioner, its agents, representatives and assigns, from importing, distributing,
selling or offering the subject product for sale to any entity in the Philippines.
In an Order[5] dated July 15, 2003 the BLA-IPO issued a preliminary injunction
which was effective for ninety days from petitioner's receipt of the said Order.
Prior to the expiration of the ninety-day period, respondents filed a Motion for
Extension of Writ of Preliminary Injunction[6] which, however, was denied by the
BLA-IPO in an Order[7] dated October 15, 2003.
Respondents filed a Motion for Reconsideration but the same was also denied by the
BLA-IPO in a Resolution[8] dated January 23, 2004.
Respondents then filed a special civil action for certiorari with the CA assailing the
October 15, 2003 and January 23, 2004 Resolutions of the BLA-IPO. Respondents
also prayed for the issuance of a preliminary mandatory injunction for the
reinstatement and extension of the writ of preliminary injunction issued by the BLA-
IPO.
restraining order[14] which prohibited petitioner from importing, distributing, selling
or offering for sale Sulbactam Ampicillin products to any hospital or to any other
entity in the Philippines, or from infringing Pfizer Inc.'s Philippine Patent No. 21116
and impounding all the sales invoices and other documents evidencing sales by
[petitioner] of Sulbactam Ampicillin products.
On February 7, 2005, petitioner again filed a Motion to Dismiss[15] the case for being
moot and academic, contending that respondents' patent had already lapsed. In the
same manner, petitioner also moved for the reconsideration of the temporary
restraining order issued by the CA on the same basis that the patent right sought to
be protected has been extinguished due to the lapse of the patent license and on the
ground that the CA has no jurisdiction to review the order of the BLA-IPO as said
jurisdiction is vested by law in the Office of the Director General of the IPO.
On April 11, 2005, the CA rendered its presently assailed Resolution denying the
Motion to Dismiss, dated November 16, 2004, and the motion for reconsideration, as
well as Motion to Dismiss, both dated February 7, 2005.

While the case was pending before the CA, respondents filed a Complaint [9] with the Hence, the present petition raising the following issues:
Regional Trial Court (RTC) of Makati City for infringement and unfair competition
with damages against herein petitioner. In said case, respondents prayed for the
a) Can an injunctive relief be issued based on an action of patent
issuance of a temporary restraining order and preliminary injunction to prevent
infringement when the patent allegedly infringed has already
herein petitioner from importing, distributing, selling or offering for sale sulbactam
lapsed?
ampicillin products to any entity in the Philippines. Respondents asked the trial court
that, after trial, judgment be rendered awarding damages in their favor and making
b) What tribunal has jurisdiction to review the decisions of the
the injunction permanent.
Director of Legal Affairs of the Intellectual Property Office?
On August 24, 2004, the RTC of Makati City issued an Order[10] directing the
c) Is there forum shopping when a party files two actions with two
issuance of a temporary restraining order conditioned upon respondents' filing of a
seemingly different causes of action and yet pray for the same
bond.
relief?[16]
In a subsequent Order[11] dated April 6, 2005, the same RTC directed the issuance of
a writ of preliminary injunction prohibiting and restraining [petitioner], its agents,
In the first issue raised, petitioner argues that respondents' exclusive right to
representatives and assigns from importing, distributing or selling Sulbactam
monopolize the subject matter of the patent exists only within the term of the patent.
Ampicillin products to any entity in the Philippines.
Petitioner claims that since respondents' patent expired on July 16, 2004, the latter no
longer possess any right of monopoly and, as such, there is no more basis for the
Meanwhile, on November 16, 2004, petitioner filed a Motion to Dismiss [12] the
issuance of a restraining order or injunction against petitioner insofar as the disputed
petition filed with the CA on the ground of forum shopping, contending that the case
patent is concerned.
filed with the RTC has the same objective as the petition filed with the CA, which is
to obtain an injunction prohibiting petitioner from importing, distributing and selling
The Court agrees.
Sulbactam Ampicillin products.
Section 37 of Republic Act No. (RA) 165,[17] which was the governing law at the
On January 18, 2005, the CA issued its questioned Resolution[13] approving the bond
time of the issuance of respondents' patent, provides:
posted by respondents pursuant to the Resolution issued by the appellate court on
March 23, 2004 which directed the issuance of a temporary restraining order
Section 37. Rights of patentees. A patentee shall have the
conditioned upon the filing of a bond. On even date, the CA issued a temporary
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 term of the patent; and such making, using, or
selling by any person without the authorization of the patentee
constitutes infringement of the patent.[18]
It is clear from the above-quoted provision of law that the exclusive right of a
patentee to make, use and sell a patented product, article or process exists only
during the term of the patent. In the instant case, Philippine Letters Patent No.
21116, which was the basis of respondents in filing their complaint with the BLA-
IPO, was issued on July 16, 1987. This fact was admitted by respondents themselves
in their complaint. They also admitted that the validity of the said patent is until July
16, 2004, which is in conformity with Section 21 of RA 165, providing that the term
of a patent shall be seventeen (17) years from the date of issuance thereof. Section 4,
Rule 129 of the Rules of Court provides that an admission, verbal or written, made
by a party in the course of the proceedings in the same case, does not require proof
and that the admission may be contradicted only by showing that it was made
through palpable mistake or that no such admission was made. In the present case,
there is no dispute as to respondents' admission that the term of their patent expired
on July 16, 2004. Neither is there evidence to show that their admission was made
through palpable mistake. Hence, contrary to the pronouncement of the CA, there is
no longer any need to present evidence on the issue of expiration of respondents'
patent.
On the basis of the foregoing, the Court agrees with petitioner that after July 16,
2004, respondents no longer possess the exclusive right to make, use and sell the
articles or products covered by Philippine Letters Patent No. 21116.
Section 3, Rule 58, of the Rules of Court lays down the requirements for the issuance
of a writ of preliminary injunction, viz:
(a) That the applicant is entitled to the relief demanded,
and the whole or part of such relief consists in restraining the
commission or continuance of the acts complained of, or in
requiring the performance of an act or acts, either for a limited
period or perpetually;
(b) That the commission, continuance or non-performance
of the act or acts complained of during the litigation would
probably work injustice to the applicant; or
(c) That a party, court, or agency or a person is doing,
threatening, or attempting to do, or is procuring or suffering to be
done, some act or acts probably in violation of the rights of the
applicant respecting the subject of the action or proceeding, and
tending to render the judgment ineffectual.
In this connection, pertinent portions of Section 5, Rule 58 of the same Rules provide
that if the matter is of extreme urgency and the applicant will suffer grave injustice
and irreparable injury, a temporary restraining order may be issued ex parte.
From the foregoing, it can be inferred that two requisites must exist to warrant the
issuance of an injunctive relief, namely: (1) the existence of a clear and unmistakable
right that must be protected; and (2) an urgent and paramount necessity for the writ
to prevent serious damage.[19]
In the instant case, it is clear that when the CA issued its January 18, 2005
Resolution approving the bond filed by respondents, the latter no longer had a right
that must be protected, considering that Philippine Letters Patent No. 21116 which
was issued to them already expired on July 16, 2004. Hence, the issuance by the CA
of a temporary restraining order in favor of the respondents is not proper.
In fact, the CA should have granted petitioner's motion to dismiss the petition
for certiorari filed before it as the only issue raised therein is the propriety of
extending the writ of preliminary injunction issued by the BLA-IPO. Since the patent
which was the basis for issuing the injunction, was no longer valid, any issue as to
the propriety of extending the life of the injunction was already rendered moot and
academic.
As to the second issue raised, the Court, is not persuaded by petitioner's argument
that, pursuant to the doctrine of primary jurisdiction, the Director General of the IPO
and not the CA has jurisdiction to review the questioned Orders of the Director of the
BLA-IPO.
It is true that under Section 7(b) of RA 8293, otherwise known as the Intellectual
Property Code of the Philippines, which is the presently prevailing law, the Director
General of the IPO exercises exclusive appellate jurisdiction over all decisions
rendered by the Director of the BLA-IPO. However, what is being questioned before
the CA is not a decision, but an interlocutory order of the BLA-IPO denying
respondents' motion to extend the life of the preliminary injunction issued in their
favor.
RA 8293 is silent with respect to any remedy available to litigants who intend to
question an interlocutory order issued by the BLA-IPO. Moreover, Section 1(c),
Rule 14 of the Rules and Regulations on Administrative Complaints for Violation of
Laws Involving Intellectual Property Rights simply provides that interlocutory orders
shall not be appealable. The said Rules and Regulations do not prescribe a procedure
within the administrative machinery to be followed in assailing orders issued by the
BLA-IPO pending final resolution of a case filed with them. Hence, in the absence of
such a remedy, the provisions of the Rules of Court shall apply in a suppletory
manner, as provided under Section 3, Rule 1 of the same Rules and Regulations.
Hence, in the present case, respondents correctly resorted to the filing of a special
civil action for certiorari with the CA to question the assailed Orders of the BLA-
IPO, as they cannot appeal therefrom and they have no other plain, speedy and
adequate remedy in the ordinary course of law. This is consistent with Sections
1[20] and 4,[21] Rule 65 of the Rules of Court, as amended.
In the first place, respondents' act of filing their complaint originally with the BLA-
IPO is already in consonance with the doctrine of primary jurisdiction.
This Court has held that:
[i]n cases involving specialized disputes, the practice has been to
refer the same to an administrative agency of special competence
in observance of the doctrine of primary jurisdiction. The Court
has ratiocinated that it cannot or will not determine a controversy
involving a question which is within the jurisdiction of the
administrative tribunal prior to the resolution of that question by
the administrative tribunal, where the question demands the
exercise of sound administrative discretion requiring the special
knowledge, experience and services of the administrative tribunal
to determine technical and intricate matters of fact, and a
uniformity of ruling is essential to comply with the premises of the
regulatory statute administered. The objective of the doctrine of
primary jurisdiction is to guide a court in determining whether it
should refrain from exercising its jurisdiction until after an
administrative agency has determined some question or some
aspect of some question arising in the proceeding before the court.
It applies where the claim is originally cognizable in the courts and
comes into play whenever enforcement of the claim requires the
resolution of issues which, under a regulatory scheme, has been
placed within the special competence of an administrative body; in
such case, the judicial process is suspended pending referral of
such issues to the administrative body for its view.[22]
Based on the foregoing, the Court finds that respondents' initial filing of their
complaint with the BLA-IPO, instead of the regular courts, is in keeping with the
doctrine of primary jurisdiction owing to the fact that the determination of the basic
issue of whether petitioner violated respondents' patent rights requires the exercise
by the IPO of sound administrative discretion which is based on the agency's special
competence, knowledge and experience.
However, the propriety of extending the life of the writ of preliminary injunction
issued by the BLA-IPO in the exercise of its quasi-judicial power is no longer a
matter that falls within the jurisdiction of the said administrative agency,
particularly that of its Director General. The resolution of this issue which was raised
before the CA does not demand the exercise by the IPO of sound administrative
discretion requiring special knowledge, experience and services in determining
technical and intricate matters of fact. It is settled that one of the exceptions to the
doctrine of primary jurisdiction is where the question involved is purely legal and
will ultimately have to be decided by the courts of justice. [23] This is the case with
respect to the issue raised in the petition filed with the CA.
Moreover, as discussed earlier, RA 8293 and its implementing rules and regulations
do not provide for a procedural remedy to question interlocutory orders issued by the
BLA-IPO. In this regard, it bears to reiterate that the judicial power of the courts, as
provided for under the Constitution, includes the authority of the courts to determine
in an appropriate action the validity of the acts of the political
departments.[24] Judicial power also includes the duty of the courts of justice to settle
actual controversies involving rights which are legally demandable and enforceable,
and to determine whether or not there has been a grave abuse of discretion
amounting to lack or excess of jurisdiction on the part of any branch or
instrumentality of the Government.[25] Hence, the CA, and not the IPO Director
General, has jurisdiction to determine whether the BLA-IPO committed grave abuse
of discretion in denying respondents' motion to extend the effectivity of the writ of
preliminary injunction which the said office earlier issued.
Lastly, petitioner avers that respondents are guilty of forum shopping for having filed
separate actions before the IPO and the RTC praying for the same relief.
The Court agrees.
Forum shopping is defined as the act of a party against whom an adverse judgment
has been rendered in one forum, of seeking another (and possibly favorable) opinion
in another forum (other than by appeal or the special civil action of certiorari), or the
institution of two (2) or more actions or proceedings grounded on the same cause on
the supposition that one or the other court would make a favorable disposition.[26]
The elements of forum shopping are: (a) identity of parties, or at least such parties
that represent the same interests in both actions; (b) identity of rights asserted and
reliefs prayed for, the reliefs being founded on the same facts; (c) identity of the two
preceding particulars, such that any judgment rendered in the other action will,
regardless of which party is successful, amount to res judicata in the action under
consideration.[27]
There is no question as to the identity of parties in the complaints filed with the IPO
and the RTC.
Respondents argue that they cannot be held guilty of forum shopping because their
complaints are based on different causes of action as shown by the fact that the said
complaints are founded on violations of different patents.
The Court is not persuaded.
Section 2, Rule 2 of the Rules of Court defines a cause of action as the act or
omission by which a party violates a right of another. In the instant case,
respondents' cause of action in their complaint filed with the IPO is the alleged act of
petitioner in importing, distributing, selling or offering for sale Sulbactam Ampicillin
products, acts that are supposedly violative of respondents' right to the exclusive sale
of the said products which are covered by the latter's patent. However, a careful
reading of the complaint filed with the RTC of Makati City would show that
respondents have the same cause of action as in their complaint filed with the IPO.
They claim that they have the exclusive right to make, use and sell Sulbactam
Ampicillin products and that petitioner violated this right. Thus, it does not matter
that the patents upon which the complaints were based are different. The fact
remains that in both complaints the rights violated and the acts violative of such
rights are identical.
In fact, respondents seek substantially the same reliefs in their separate complaints
with the IPO and the RTC for the purpose of accomplishing the same objective.
It is settled by this Court in several cases that the filing by a party of two apparently
different actions but with the same objective constitutes forum shopping. [28] The
Court discussed this species of forum shopping as follows:
Very simply stated, the original complaint in the
court a quo which gave rise to the instant petition was filed
by the buyer (herein private respondent and his
predecessors-in-interest) against the seller (herein
petitioners) to enforce the alleged perfected sale of real
estate. On the other hand, the complaint in the Second Case
seeks to declare such purported sale involving the same real
property as unenforceable as against the Bank, which is the
petitioner herein. In other words, in the Second Case, the
majority stockholders, in representation of the Bank, are
seeking to accomplish what the Bank itself failed to do in
the original case in the trial court. In brief, the objective or
the relief being sought, though worded differently, is the
same, namely, to enable the petitioner Bank to escape
from the obligation to sell the property to respondent. [29]
In Danville Maritime, Inc. v. Commission on Audit,[30] the Court ruled as
follows:
In the attempt to make the two actions appear to be different,
petitioner impleaded different respondents therein PNOC in the
case before the lower court and the COA in the case before this
Court and sought what seems to be different reliefs. Petitioner asks
this Court to set aside the questioned letter-directive of the COA
dated October 10, 1988 and to direct said body to approve the
Memorandum of Agreement entered into by and between the
PNOC and petitioner, while in the complaint before the lower court
petitioner seeks to enjoin the PNOC from conducting a rebidding
and from selling to other parties the vessel T/T Andres Bonifacio,
and for an extension of time for it to comply with the paragraph 1
of the memorandum of agreement and damages. One can see that
although the relief prayed for in the two (2) actions are
ostensibly different, the ultimate objective in both actions is the
same, that is, the approval of the sale of vessel in favor of
petitioner, and to overturn the letter directive of the COA of
October 10, 1988 disapproving the sale.[31]
In the instant case, the prayer of respondents in their complaint filed with the IPO is
as follows:
A. Immediately upon the filing of this action, issue an ex
parte order (a) temporarily restraining respondent, its agents,
representatives and assigns from importing, distributing, selling or
offering for sale Sulbactam Ampicillin products to the hospitals
named in paragraph 9 of this Complaint or to any other entity in the
Philippines, or from otherwise infringing Pfizer Inc.'s Philippine
Patent No. 21116; and (b) impounding all the sales invoices and
other documents evidencing sales by respondent of Sulbactam
Ampicillin products.
B. After hearing, issue a writ of preliminary injunction enjoining
respondent, its agents, representatives and assigns from importing,
distributing, selling or offering for sale Sulbactam Ampicillin
products to the hospitals named in paragraph 9 of the Complaint or
to any other entity in the Philippines, or from otherwise infringing
Pfizer Inc.'s Philippine Patent No. 21116; and
C. After trial, render judgment:
(i) declaring that respondent has
infringed Pfizer Inc.'s Philippine
Patent No. 21116 and that respondent
has no right whatsoever over
complainant's patent;
(ii) ordering respondent to pay complainants the
following amounts:
(a) at least P1,000,000.00 as actual damages;
(b) P700,000.00 as attorney's fees and litigation expenses;
(d) P1,000,000.00 as exemplary damages; and
 (d) costs of this suit. or from otherwise infringing
(iii) ordering the condemnation, seizure or Patent No. 26810;
forfeiture of respondent's infringing goods or
products, wherever they may be found, including (2) impounding all the sales invoices
the materials and implements used in the and other documents evidencing sales
commission of infringement, to be disposed of in by Pharmawealth of sulbactam
such manner as may be deemed appropriate by ampicillin products; and
this Honorable Office; and
(3) disposing of the infringing goods outside the
(iv) making the injunction permanent.[32] channels of commerce.

(c) After trial, render judgment:

In an almost identical manner, respondents prayed for the following in their
complaint filed with the RTC:
(a) Immediately upon the filing of this action, issue an ex
parte order:
(1) temporarily restraining Pharmawealth, its agents,
representatives and assigns from importing, distributing,
selling or offering for sale infringing sulbactam
ampicillin products to various government and
private hospitals or to any other entity in the Philippines,
or from otherwise infringing Pfizer Inc.'s Philippine
Patent No. 26810.
(2) impounding all the sales invoices
and other documents
evidencing sales by
pharmawealth of sulbactam
ampicillin products; and
(3) disposing of the infringing goods
outside the channels of
commerce.
(b) After hearing, issue a writ of preliminary injunction:
(1) enjoining Pharmawealth, its agents,
representatives and assigns
from importing, distributing,
selling or offering for sale
infringing sulbactam
ampicillin products to various
government hospitals or to any
other entity in the Philippines,
(1) finding Pharmawealth to have
infringed Patent No. 26810 and
declaring Pharmawealth to have no
right whatsoever over plaintiff's patent;
(2) ordering Pharmawealth to pay
plaintiffs the following amounts:
(i) at least P3,000,000.00 as
actual damages;
(ii) P500,000.00 as attorney's fees and P1,000,000.00 as
litigation expenses;
(iii) P3,000,000.00 as
exemplary damages;
and
(iv) costs of this suit.
(3) ordering the condemnation, seizure
or forfeiture of
Pharmawealth's infringing
goods or products, wherever
they may be found, including
the materials and implements
used in the commission of
infringement, to be disposed
of in such manner as may be
deemed appropriate by this
Honorable Court; and
(4) making the injunction permanent.[33]
It is clear from the foregoing that the ultimate objective which respondents seek to
achieve in their separate complaints filed with the RTC and the IPO, is to ask for
damages for the alleged violation of their right to exclusively sell Sulbactam
Ampicillin products and to permanently prevent or prohibit petitioner from selling
said products to any entity.Owing to the substantial identity of parties, reliefs and
issues in the IPO and RTC cases, a decision in one case will necessarily amount
to res judicata in the other action.
It bears to reiterate that what is truly important to consider in determining whether
forum shopping exists or not is the vexation caused the courts and parties-litigant by
a party who asks different courts and/or administrative agencies to rule on the same
or related causes and/or to grant the same or substantially the same reliefs, in the
process creating the possibility of conflicting decisions being rendered by the
different fora upon the same issue.[34]
Thus, the Court agrees with petitioner that respondents are indeed guilty of forum
shopping.
Jurisprudence holds that if the forum shopping is not considered willful and
deliberate, the subsequent case shall be dismissed without prejudice, on the ground
of either litis pendentia or res judicata.[35] However, if the forum shopping is willful
and deliberate, both (or all, if there are more than two) actions shall be dismissed
with prejudice.[36] In the present case, the Court finds that respondents did not
deliberately violate the rule on non-forum shopping. Respondents may not be totally
blamed for erroneously believing that they can file separate actions simply on the
basis of different patents. Moreover, in the suit filed with the RTC of Makati City,
respondents were candid enough to inform the trial court of the pendency of the
complaint filed with the BLA-IPO as well as the petition for certiorari filed with the
CA. On these bases, only Civil Case No. 04-754 should be dismissed on the ground
of litis pendentia.
WHEREFORE, the petition is PARTLY GRANTED. The assailed Resolutions of
the Court of Appeals, dated January 18, 2005 and April 11, 2005, in CA-G.R. No.
82734, are REVERSED and SET ASIDE. The petition for certiorari filed with the
Court of Appeals is DISMISSED for being moot and academic.
Civil Case No. 04-754, filed with the Regional Trial Court of Makati City, Branch
138, is likewise DISMISSED on the ground of litis pendentia.
SO ORDERED.
IP Views
Case Digest: Pharmawealth vs. Pfizer (Patent Infringement)
December 19, 2010
Phil. Pharmawealth, Inc. v. Pfizer, Inc. & Pfizer (Phil.), Inc. G.R. No. 167715, 17
November 2010
by: Alpheus D. Macalalad
Facts: Pfizer is the registered owner of a patent pertaining to Sulbactam Ampicillin. It
is marketed under the brand name “Unasyn.” Sometime in January and February
2003, Pfizer discovered that Pharmawealth submitted bids for the supply of
Sulbactam Ampicillin to several hospitals without the Pfizer’s consent. Pfizer then
demanded that the hospitals cease and desist from accepting such bids. Pfizer also
demanded that Pharmawealth immediately withdraw its bids to supply Sulbactam
Ampicillin. Pharmawealth and the hospitals ignored the demands.
Pfizer then filed a complaint for patent infringement with a prayer for permanent
injunction and forfeiture of the infringing products. A preliminary injunction effective for
90 days was granted by the IPO’s Bureau of Legal Affairs (IPO-BLA). Upon
expiration, a motion for extension filed by Pfizer was denied. Pfizer filed a Special
Civil Action for Certiorari in the Court of Appeals (CA) assailing the denial.
While the case was pending in the CA, Pfizer filed with the Regional Trial Court of
Makati (RTC) a complaint for infringement and unfair competition, with a prayer for
injunction. The RTC issued a temporary restraining order, and then a preliminary
injunction.
Pharmawealth filed a motion to dismiss the case in the CA, on the ground of forum
shopping. Nevertheless, the CA issued a temporary restraining order. Pharmawealth
again filed a motion to dismiss, alleging that the patent, the main basis of the case,
had already lapsed, thus making the case moot, and that the CA had no jurisdiction to
review the order of the IPO-BLA because this was granted to the Director General.
The CA denied all the motions. Pharmawealth filed a petition for review on Certiorari
with the Supreme Court.
Issues:
a) Can an injunctive relief be issued based on an action of patent infringement when
the patent allegedly infringed has already lapsed?
b) What tribunal has jurisdiction to review the decisions of the Director of Legal Affairs
of the Intellectual Property Office?
c) Is there forum shopping when a party files two actions with two seemingly different
causes of action and yet pray for the same relief?
Held:
a) No. The provision of R.A. 165, from which the Pfizer’s patent was based, clearly
states that "[the] 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 term of the
patent; and such making, using, or selling by any person without the authorization of
the patentee constitutes infringement of the patent."
Clearly, the patentee’s exclusive rights exist only during the term of the patent. Since
the patent was registered on 16 July 1987, it expired, in accordance with the
provisions of R.A. 165, after 17 years, or 16 July 2004. Thus, after 16 July 2004,
Pfizer no longer possessed the exclusive right to make, use, and sell the products
covered by their patent. The CA was wrong in issuing a temporary restraining order
after the cut-off date.

b) According to IP Code, the Director General of the IPO exercises exclusive

jurisdiction over decisions of the IPO-BLA. The question in the CA concerns an
interlocutory order, and not a decision. Since the IP Code and the Rules and
Regulations are bereft of any remedy regarding interlocutory orders of the IPO-BLA,
the only remedy available to Pfizer is to apply the Rules and Regulations suppletorily.
Under the Rules, a petition for certiorari to the CA is the proper remedy. This is
consistent with the Rules of Court. Thus, the CA had jurisdiction.

c) Yes. Forum shopping is defined as the act of a party against whom an adverse
judgment has been rendered in one forum, of seeking another (and possibly
favorable) opinion in another forum (other than by appeal or the special civil action of
certiorari), or the institution of two (2) or more actions or proceedings grounded on the
same cause on the supposition that one or the other court would make a favorable
disposition.

The elements of forum shopping are: (a) identity of parties, or at least such parties
that represent the same interests in both actions; (b) identity of rights asserted and
reliefs prayed for, the reliefs being founded on the same facts; (c) identity of the two
preceding particulars, such that any judgment rendered in the other action will,
regardless of which party is successful, amount to res judicata in the action under
consideration. This instance meets these elements.

The parties are clearly identical. In both the complaints in the BLA-IPO and RTC, the
rights allegedly violated and the acts allegedly violative of such rights are identical,
regardless of whether the patents on which the complaints were based are different.
In both cases, the ultimate objective of Pfizer was to ask for damages and to
permanently prevent Pharmawealth from selling the contested products. Relevantly,
the Supreme Court has decided that the filing of two actions with the same objective,
as in this instance, constitutes forum shopping.

Owing to the substantial identity of parties, reliefs and issues in the IPO and RTC
cases, a decision in one case will necessarily amount to res judicata in the other
action.
G.R. No. L-27793 March 15, 1928
PATRICK HENRY FRANK and WILLIAM HENRY GOHN, plaintiff-
appellees,
vs.
CONSTANCIO BENITO, defendant-appellant.
Abad Santos, Camus, Delgado and Recto for appellant.
J. W. Ferrier for appellees.
STATEMENT
Plaintiffs allege that they are the owners of a patent covering hemp-stripping
machine No. 1519579 issued to them by the United States Patent Office of
December 16, 1924, and duly registered in the Bureau of Commerce and Industry of
the Philippine Islands under the provisions of Act No. 2235 of the Philippine
Legislature on March 17, 1925. That the important feature of the machine "is a
spindle upon which the hemp to be stripped is wound in the process of stripping."
That plaintiffs have for some time been manufacturing the machine under the patent.
That the defendant manufactured a hemp-stripping machine in which, without
authority from the plaintiffs, he has embodied and used such spindles and their
method of application and use, and is exhibiting his machine to the public for the
purpose of inducing its purchase. That the use by the defendant of such spindles and
the principle of their application to the stripping of hemp is in violation of, and in
conflict with, plaintiffs' patent, together with its conditions and specifications. That
the defendant's machine is an infringement upon the patent granted the plaintiffs, and
plaintiffs pray for an injunction that the defendant be required to account to plaintiffs
for any profits he may have made by reason of such infringement, and for a
temporary injunction restraining him in the manufacture of other machines of the
same kind of its exhibition, and that upon the final hearing, the injunction be made
permanent.
The defendant demurred to the complaint upon the ground that the facts alleged
therein do not constitute a cause of action, that it is ambiguous and vague, and that it
was error to make William Henry Gohn plaintiff.
After the demurrer was overruled, the defendant filed an answer in which he denied
all of the material allegations of the complaint, except those which are hereinafter
admitted, and as a special defense alleges:
First. That the defendant has never had at any time nor does he have any
knowledge of any suppose invention of the plaintiffs of whatever kind of
hemp-stripping machine, whether patented or not, which has circulated or
not in the Philippine Islands for the sale thereof or its private exploitation.
Second. That not having had any knowledge of any kind of hemp-stripping
machine supposed to have been invented by the plaintiffs, it never occurred
to the defendant to imitate the unknown invention of the plaintiffs.
Third. That the hemp-stripping machine of the plaintiffs, known as "La
Constancia," patent of which is duly registered, has its characteristics and
original invention belonging to the defendant which consist of two pinions
with horizontal grooves which form the tool for extracting the fibers
between a straight knife upon another which is cylindrical and provided
with teeth and on the center of said two pinions there is a flying wheel its
transmission belt connecting it with the motor.
As a counterclaim, the defendant alleges:
First. That he reproduces in this paragraph each and every allegation
contained in the preceding special defense, as though the same were literally
copied here.
Second. That by the filing of the complaint of the plaintiffs and the
issuance, as a consequence thereof, of a writ of injunction in this case,
unduly obtained by the said plaintiffs through false and fraudulent
representations, the defendant has suffered damages in the sum of five
thousand pesos (P5,000), Philippine currency.
Wherefore, the defendant prays this court that he be absolved from the
herein complaint, and that the plaintiffs be ordered jointly and severally to
pay the sum of five thousand pesos (P5,000), Philippine currency, as
damages, with legal interest thereon from the filing of this action until fully
paid; with the costs of this case, as well as any other remedy that may be
proper in law and equity.
The lower court rendered judgment in legal effect granting the plaintiffs the
injunction prayed for in their complaint, and absolving them from defendant's
counterclaim, and judgment against the defendant for costs.
The defendant's motion for a new trial was overruled, and on appeal, he contends
that the court erred in holding the same spindles used by the parties in this case,
though different in material and form, have the same utility and efficiency and that
they are the same, and in finding that spindles used by the defendant are an imitation
of those of the plaintiffs, and in finding that the defendant infringed upon plaintiffs'
patent, and in not rendering judgment against the plaintiffs, requiring them to pay
defendant P5,000 as damages, and in enjoining the appellant from the manufacture,
use and sale of this hemp-stripping machine.

JOHNS, J.:
It is conceded that on December 16, 1924, the United States Patent Office issued to
the plaintiffs the patent in question No. 1519579, and it was duly registered in the
Bureau of Commerce and Industry of the Philippine Islands on March 17, 1925.
After such registration the patent laws, as they exist in the United States for such
patent, are then applied to and are in force and effect in the Philippine Islands.
(Vargas vs. F. M. Yaptico & Co., 40 Phil., 195.) In the instant case, the original
patent is in evidence, and that decision further holds that:
The burden of proof to substantiate a charge of infringement is with the
plaintiff. Where, however, the plaintiff introduces the patent in evidence, if
it is in due form, it affords a prima facie presumption of its correctness and
validity. The decision of the Commissioner of Patents in granting the patent
is always presumed to be correct. The burden the shifts to the defendant to
overcome by competent evidence this legal presumption.
That is to say, the patent, which in the instant case is in due form, having
been introduced in evidence, "affords a prima facie presumption of its
correctness and validity." Hence, this is not a case of a conflict between two
different patents. In the recent of Temco Electric Motor Co. vs. Apco Mfg.
Co., decided by the Supreme Court of the United States on January 3, 1928,
Advance Sheet No. 5, p. 192, the syllabus says:
An improper cannot appropriate the basic patent of another, and if he does
so without license is an infringer, and may be used as such.
And on page 195 of the opinion, it is said:
It is well established that an improver cannot appropriate the basic patent of
another and that the improver without a license is an infringer and may be
sued as such.
Citing a number of Federal decisions.
The plans and specifications upon which the patent was issued recite:
Our invention relates to hemp stripping machines and it consists in the
combinations, constructions and arrangements herein described and
claimed.
An object of our invention is to provide a machine affording facilities
whereby the operation of stripping hemp leaves may be accomplished
mechanically, thereby obviating the strain incident to the performance of
hemp stripping operations manually.
And on page 3 of the application for patent, it is said:
Obviously, our invention is susceptible of embodiment in forms other than
the illustrated herein and we therefore consider as our own all modifications
of the form of device herein disclosed which fairly fall within the spirit and
scope of our invention as claimed.
We claim:
1. In a hemp stripping machine, a stripping head having a supporting
portion on which the hemp leaves may rest and having also an upright
bracket portion, a lever of angular formation pivotally attached substantially
at the juncture of the arms thereof of the bracket portion of the stripping
head, whereby one arm of the lever overlies the supporting portion of the
stripping head, a blade carried by said one arm of the lever for cooperating
with said supporting, means connected with the other arm of the lever and
actuating the latter to continously urge the blade toward said supporting
portion of the stripping head, and a rotatable spindle positioned adjacent to
said stripping head, said spindle being adapted to be engaged by hemp
leaves extending across said supporting portion of the stripping head
underneath said blade and being operable to draw said hemp leaves in the
direction of their length between said supporting portion of the stripping
head and said blade.
2. In a hemp stripping machine, a stripping head having a horizontal table
portion, a rest supported upon said table portion, a stripping knife supported
upon the table for movement into and out of position to cooperate with the
rest to strip hemp leaves drawn between the knife and the rest, and power
driven means adapted to be engaged with said hemp leaves and to pull the
latter between the knife and rest, said power driven means including a
rotating spindle, said spindle being free at one end and tapering regularly
toward its free end.
3. In a hemp stripping machine, a stripping head having a horizontal table
portion and an upright bracket portion a rest holder adjustably on the table
portion, a rest resiliently supported by the holder, a knife carrying lever of
angular formation and being pivotally attached substantially at the juncture
of the arms thereof to the bracket portion of the stripping head, whereby one
arm of the lever overlies the rest, a blade adjustably supported on said one
arm, for cooperating with said rest and gravity means connected with the
 other arm of the lever and actuating the latter to continously urge the blade
toward the rest.
The spindle upon which the patent was obtained, together with the spindle upon
which the defendant relies are exhibits in the record and were before the court at the
time this case was argued. The spindle of the plaintiffs was made of wood, conical in
shape and with a smooth surface. That of the defendant was somewhat similar in
shape, but was made of metal with rough surface, and the defendant claims that his
spindle was more effective and would do better work than that of the plaintiffs. Be
that as it may, the plaintiffs have a patent for their machine, and the defendant does
not have a patent, and the basic principle of plaintiffs' patent is the spindle upon
which they rely, together with its specified manner and mode of operation, and in the
final analysis, it must be conceded that the basic principle of the spindle upon which
the defendant relies is founded upon the basic principle of the spindle for which the
plaintiffs have a patent. Assuming, without deciding, that the defendant's spindle is
an improvement upon and is a better spindle than that of the plaintiffs, yet, under the
authority above cited, the defendant had no legal right to appropriate the basic
principle upon which the plaintiffs obtained their patent. The plaintiffs having
obtained their patent, which was duly registered in the Philippines Islands, the
defendant cannot infringe upon its basic principle.
The defendant contends that the basic principle of the spindle was a very old one in
mechanics, and that there was nothing new or novel in the application of it by the
plaintiffs. Be that as it may, the plaintiffs applied for and obtained their patent with
its specifications which are attached to, and made part of, the patent, and the proof is
conclusive that the defendant is infringing upon the basic principle of the spindle as
it is defined and specified in plaintiffs' patent.
Plaintiffs assert the violation of infringement upon the patent granted to Frank &
Gohn, and requested that an action for injunction and damages be instituted against
Benito.
Respondent on the other hand contends that it had no prior knowledge of the prior
existence of the hemp-stripping invention of the plaintiffs nor had any intent to
imitate the Frank’s product. Likewise, the defendant contended that the facts alleged
therein do not constitute a cause of action, that it is ambiguous and vague. The lower
court rendered judgment in favor of the plaintiffs, to which was later affirmed by the
appellate court.
HELD: As a rule, the burden of proof to substantiate a charge of infringement is
with the plaintiff. Where, however, the plaintiff introduces the patent in evidence, if
it is in due form, it affords a prima facie presumption of its correctness and validity.
The decision of the Commissioner of Patents in granting the patent is always
presumed to be correct. The burden the shifts to the defendant to overcome by
competent evidence this legal presumption.
The patent in the case at bar, having been introduced in evidence, affords a prima
facie presumption of its correctness and validity. Hence, this is not a case of a
conflict between two different patents. In the recent of Temco Electric Motor Co. vs.
Apco Mfg. Co., decided by the Supreme Court of the United States ruled “an
improper cannot appropriate the basic patent of another, and if he does so without
license is an infringer, and may be used as such. It is well established that an
improver cannot appropriate the basic patent of another and that the improver
without a license is an infringer and may be sued as such.”

The judgment of the lower court is affirmed, with costs. So ordered.

ATRICK HENRY FRANK and WILLIAM HENRY GOHN vs. CONSTANCIO

BENITO
G.R. No. L-27793, March 15, 1928

FACTS: Plaintiffs are the owners of a patent covering hemp-stripping machine No.
1519579 issued to them by the United States Patent Office and duly registered in the
Bureau of Commerce and Industry of the Philippine Islands under the provisions of
Act No. 2235

Plaintiffs allege that the defendant manufactured a hemp-stripping machine in which,

without authority from the plaintiffs, and has embodied and used such spindles and
their method of application and use, and is exhibiting his machine to the public for
the purpose of inducing its purchase. Frank and Gohn stress that use by the Benito of
such spindles and the principle of their application to the stripping of hemp is in
violation of, and in conflict with, plaintiffs' patent, together with its conditions and
specifications.
G.R. No. L-4720 January 19, 1909
CARLOS GSELL, plaintiff-appellee,
vs.
VALERIANO VELOSO YAP-JUE, defendant-appellant.
Chicote and Miranda, for appellant.
Haussermann and Cohn, for appellee.
CARSON, J.:
This an appeal from a final order of the Court of First Instance of the city of Manila,
in contempt proceedings prosecuted under the provisions of section 172 of the Code
of Civil Procedure. The principal case to which these proceedings are ancillary, was
an action to enjoin infringement of a patented process for the manufacture of curved
handles for canes, parasols, and umbrellas. In that case plaintiff established his title
to a valid patent covering the process in question, and obtained against this defendant
a judgment, granting a perpetual injunction restraining its infringement, which
judgment was affirmed by this court on appeal (6 Phil. Rep., 143.) The order was
couched in the following terms:
It is ordered that the defendant abstain from manufacturing canes and
umbrellas with a curved handle by means of a lamp or blowpipe fed with
mineral oil or petroleum, which process was protected by patent No. 19228,
issued in favor of Henry Gsell, and by him transferred to Carlos Gsell —
and the process therein mentioned is fully described in the following statement
which accompanied the application for the patent:
After the canes have been cut for cane or umbrella handles, the outsides are
thoroughly cleaned. This operation having been performed, they are then
trimmed and the interior cleaned by means of a gimlet of about 15
centimeters in length operated by a wheel, by means of which the knots
inside are broken. There is then introduced to a depth of about 15
centimeters a piece of very clean bamboo, which completely fills the hole
made by the gimlet, thereby giving to the cane the necessary strength to
resist the heat of the lamp or blowpipe without breaking or cracking.
This operation having been performed, the cane, the end of which is
attached to a fixed point, is given the shape of a hook or some other form by
means of fire and pressure. Once the cane has been shaped as desired, it is
allowed to cool, and is then cleaned, varnished, and ornamented at will.
This industry requires skillful, handiwork, owing to the great risk
engendered by the treatment of such fragile material as a light cane. On the
other hand, however, it affords large profits to the workman.
NOTE. — The patent applied for shall be for the industrial product "cane
handles for walking sticks and umbrellas, curved by means of a small lamp
or blowpipe, fed by petroleum or mineral fuel."
Thereafter the defendant continued to manufacture curved cane handled for walking
sticks and umbrellas by a process in all respectes identical with that used by the
plaintiff under his patent, except only that he be substituted for a lamp fed with
petroleum or mineral oil, lamp fed with alcohol, as appears from a stipulation entered
into between plaintiff and defendant in the following terms:
The plaintiff and defendant agree upon the fact that the defendant has used
and is still using a process for curving handles of canes and umbrellas
identical with that described in the application for the patent by the plaintiff
with the exception that he has substituted for the lamp fed with all other
lamp fed with alcohol.
Contempt proceedings were instituted against the defendant in the month of
February, 1904, the plaintiff in the original action alleging that the —
Defendant in disobediencce of the judgment of the same was and is now
engaged in the unlawful manufacture of umbrella handles by the identical
process described in and protected said patent, No. 19228, or a process so
like the patented process as to be indistinguishable.
The trial court found the defendant "not guilty" of contempt as charged; and this
court, on appeal, held that — a character that it could be made patent by the mere
annunciation of the acts performed by the defendant, which are alleged to constitute
the said violation. These acts were not clearly and manifestly contrary to the precise
terms of the prohibition. According to the express language of the judgment, the
prohibition is against the manufacture of canes and umbrellas with curved handles by
means of the use of a cool or mineral oil-burning lamp or blowpipe and the parties
have stipulated that the defendant did not use a coal or mineral oil-burning lamp but
an alcohol-burning lamp.
The question, however, arises as to whether that prohibition included the
substitution of alcohol for coal or mineral oil. In more abstract and general
terms, the appellant propounds this question in his brief, as follows: "The
question presented by this appeal is whether or not the use of a patented
process by a third person, without license or authority therefor, constitutes
an infringement when the alleged infringer has substituted in lieu of
some unessential part of the patented process a well-known mechanical
 equivalent." It has seen that by its very terms this question implies in the
present case the existence of two fundamental facts which must first be duly
established, viz: (1) That the use of the lamp fed with petroleum or mineral
oil was an unessential part of the patented process the use of which by the
accused was prohibited by the said judgment; and (2) that alcohol is an
equivalent and proper substitute, well known as such, for mineral oil or
petroleum in connection with the said process. The appellant has failed to
affirmatively establish either of these two essential facts. He has merely
assumed their existence, without proving the same, thus begging the whole
question. Consequently the contempt with which the accused is charged has
not been fully and satisfactorily proved, and the order appealed from should
accordingly be affirmed in so far as it holds that the defendant is not guilty
of contempt. (7 Phil. Rep., 130).
Thereafter the plaintiff continued the use of the patented process, save only for the
substitutions of a lamp fed by alcohol for a lamp fed by petroleum or mineral oil, and
new proceedings were instituted under the provisions of section 172 for the purpose
of enforcing the original injunction above cited. Substantially the same question is
submitted in these new proceedings as that submitted in the former case, but at the
trial of this case testimony was introduced which, in our opinion, leaves no room for
doubt, first, that alcohol is an equivalent or substitute, well known as such at the time
when the patent was issued, for mineral oil or petroleum, in connection with blast
lamps or blowpipes such as that which plaintiff uses in the patented process, and,
second, that the use of a blast lamp or blowpipe fed with petroleum or mineral oil,
rather than one fed with alcohol, is an unessential part of the patented process the use
of which was prohibited by the said judgment.
It was clearly proven at the trial, that kerosene and alcohol blast lamps are agencies
for producing and applying heat, well known throughout the world long prior to
1906, the date of the issue of the patent; that it is and for many years has been known
that one may for all ordinary purposes be used in the place of the other, and
especially for the purpose of applying heat in the manner described in the patent; that
the only consideration which determines the employment of one in place of the other
is the convenience of the user and the question of relative cost; and that the principle
upon which both lamps work is substantially identical, the only difference in
construction being occasioned by the application of this principle to oils of different
physical and chemical composition.
The plaintiff does not and can not claim a patent upon the particular lamp used by
him. The patent, however, gives him the exclusive right to the use of "la lamparilla o
soplete, alimentada de petroleo o esencia mineral" (the small lamp or blowpipe fed
with petroleum or mineral oil) in manufacturing curved handles for umbrellas and
canes, to which reference is made in the above-cited descriptive statement and
annexed note. "The small lamp or blowpipe" mentioned in the descriptive statement
and annexed note which accompanied the application for the patent, evidently
referred to the design of a blast lamp which was attached thereto; and in our opinion
both plaintiff and defendant make use of a blast lamp substantially similar, in
principle and design, to that referred to in the descriptive statement and the annexed
note, for the exclusive use of which in the manufacture of curved handles, plaintiff
holds a patent. True, defendant's blast lamp is fed with alcohol, and its shape varies
in unimportant details, for the purpose of accommodating the principle, by which the
flame is secured, to the different physical and chemical composition of the fuel used
therein; but the principle on which it works, its mode of application, and its general
design distinguish it in no essential particular from that used by the plaintiff. If the
original design accompanying the statement had shown a blast lamp made of brass or
delf, he would be a reckless advocate who would claim that the patent might lawfully
be evaded by the use of a lamp made of iron or tin; or if the original design had
shown a blast lamp 6 inches high with a nozzle 4 inches long it would hardly be
seriously contended that the use of lamp 8 inches high with a nozzle 3 inches long
would protect the ingenious individual, who in all other respects borrowed the
patented process, from the consequences of an action for damages for infringement.
But in the light of the evidence of record in this case, the reasoning upon which these
hypothetical claims should be rejected applies with equal force to the contentions of
the defendant, the ground for the rejection of the claims in each case being the same,
and resting on the fact that unessential changes, which do not affect the principle of
the blast lamp used in the patented process, or the mode of application of heat
authorized by the patent, are not sufficient to support a contention that the process in
one case is in any essential particular different from that used in the other.
Counsel for plaintif invokes the doctrine of "mechanical equivalents" in support of
his contention, and indeed that doctrine is strikingly applicable to the facts in this
case. This doctrine is founded upon sound rules of reason and logic, and unless
restrained or modified by law in particular jurisdiction, is of universal application, so
that it matters not whether a patent be issued by one sovereignty or another, the
doctrine may properly be invoked to protect the patentee from colorable invasions of
his patent under the guise of substitution of some part of his invention by some well
known mechanical equivalent. Our attention has not been called to any provision of
the patent law of Spain, which denies to patentees thereunder the just and equitable
protection of the doctrine; and indeed a patent law which failed to recognize this
doctrine would afford scant protection to inventors, for it is difficult if not impossible
to conceive an invention, which is incapable of alteration or change in some
unessential part, so as to bring that part outside of the express terms of any form of
language which might be used in granting a patent for the invention; and has been
well said by counsel for plaintiff, human ingenuity would be taxed beyond its powers
in preparing a grant of a patent so comprehensive in its terms, "as to include within
the express terms of its detailed description every possible alternative of form, size,
shape, material, location, color, weight, etc., of every wheel, rod, bolt, nut, screw,
plate, and other component parts of an invention."
The following citations from various decisions of the Federal Courts of the United
States illustrate the application of the doctrine in that jurisdiction, and clearly point
the way to the proper solution of the questions involved in the case at bar:
Can the defendant have the right of infringement, by substituting in lieu of
some parts of the combination well-known mechanical equivalents? I am
quite clear that be can not, both on principle and authority. It is not to be
disputed that the inventor of an ordinary machine is, by his letters patent,
protected against all mere formal alterations and against the substitution of
mere mechanical equivalents. Why should not the inventor of a new
combination receive the same protection? If he can not, then will his patent
not be worth the parchment on which it is written.
If no one can be held to infringe a patent for a combination unless he uses
all the parts of the combination and the identical machinery as that of the
patentee, then will no patent for a combination be infringed; for certainly
no one capable of operating a machine can be incapable of adopting some
formal alteration in the machinery, or of substituting mechanical
equivalents. No one infringes a patent for a combination who does not
employ all of the ingredients of the combination; but if he employs all the
ingredients, or adopts mere formal alterations, or substitutes, for one
ingredient another which was well known at the date of the patent as a
proper substitute for the one withdrawn, and which performs substantially
the same function as the one withdrawn, he does infringe. (King vs.
Louisville Cement Co., Fed. Cas., 7798.)
Bona fide inventors of a combination are as much entitled to equivalents as
the inventors other patentable improvements; by which is meant that a
patentee in such a case may substitute another ingredient for any one of the
ingredients of his invention, if the ingredient substituted performs the same
function as the one omitted and as well known at the date of his patent as a
proper substitute for the one omitted in the patented combination. Apply
that rule and it is clear that an alteration in a patented combination which
merely substitutes another old ingredient for one of the ingredients in the
patented combination, is an infringement of the patent, if the substitute
performs the same function and was well known at the date of the patent as
a proper substitute for the omitted ingredient. (Gould vs. Rees, 82 U.S., 187,
194.)
Mere formal alterations in a combination in letters patent are no defense to
the charge of infringement and the withdrawal of one ingredient from the
same and the substitution of another which was well known at the date of
the patent as a proper substitute for the one withdrawn is a mere formal
alteration of the combination if the ingredient substituted performs
substantially the same function as the one withdrawn.
Bona fide inventors of a combination are as much entitled to suppress every
other combination of the same ingredients to produce the same result, not
substantially different from what they have invented and caused to be
patented as to any other class of inventors. All alike have the right to
suppress every colorable invasion of that which is secured to them by letters
patent. (Seymour vs. Osborne, 78 U.S., 516, 556.)
A claim for the particular means and mode of operation described in the
specification extends, by operation of law, to the equivalent of such means
— not equivalent simply because the same result is thereby produced — but
equivalent as being substantially the same device in structure, arrangement
and mode of operation. (Burden vs. Corning, Fed. Cas., 2143.
Gottfried vs. Philip Best Brewing Co., Fed. Cas., 5633.)
An equivalent device is such as a mechanic of ordinary skill in construction
of similar machinery, having the forms, specifications and machine before
him, could substitute in the place of the mechanism described without the
exercise of the inventive faculty. (Burden vs. Corning, supra.)
All the elements of the invention in this case are old, and the rule in such
cases, as before explained, undoubtedly is that a purpose can not invoke the
doctrine of equivalents to suppress all other improvements of the old
machine, but he is entitled to treat everyone as an infringer who makes,
uses, or vends his patented improvement without any other change than the
employment of a substitute for one of its elements, well known as such at
the date of his invention, and which any constructor acquainted with the art
will know how to comply. The reason for the qualification of the rule as
stated is, that such change — that is, the mere substitution of a well- known
element for another — where it appears that the substituted element was
well known as a usual substitute for the element left out — is merely a
formal one, and nothing better than a colorable evasion of the patent.
(Union Sugar Refining Co. vs. Matthieson, Fed. Cas., 14399.)
Counsel for the defendant insists that, under Spanish law, none of the steps of the
process described in the descriptive statement, save those mentioned in the "note"
thereto attached are included in the patent, and that the patent rights secured
thereunder are strictly limited to the precise language of the "note" attached to the
descriptive statement; while counsel for plaintiff appears to think that the language
of the patent covers any process or device whereby wood or cane may be bent or
curved by the use of heat. But for the purpose of this decision it is not necessary to
consider these questions, further than to hold, as we do, that under the doctrine of
equivalents, the language of the note in the descriptive statement applies to the
operation of applying heat for the purpose of curving handles or canes and umbrellas
by means of a blast lamp fed with alcohol, as well as by means of a blast lamp fed
with petroleum or mineral oil; and the defendant having admitted the fact that he
applied heat for the purpose of curving handles for canes and umbrellas by means of
a blast lamp fed with alcohol, he must be deemed to have contempt of violating the
terms and the injunction issued in the principal case, wherein plaintiff was declared
the owner of the patent in question, and defendant enjoined from its infringement.
The argument of counsel for defendant and appellant, based on the theory that the
questions herein discussed and decided to have been heretofore settled by this court,
and that the subject-matter of this proceeding is res adjudicata between the parties
thereto is sufficiently refuted by the simple reading of the decision of this court in the
case relied upon. (Gsell vs. Veloso, 7 Phil. Rep., 130.)
The judgment of the lower court should be and is hereby affirmed, with the costs of
this instance against the appellant.
Arellano, C.J., Torres, Mapa, Willard, and Tracey, JJ., concur.
CASE DIGEST: CARLOS GSELL vs. VALERIANO VELOSO YAP-JUE
FACTS:
The principal case to which these proceedings are ancillary, was an action to
enjoin infringement of a patented process for manufacture of curved handles for
canes, parasols, and umbrellas. In that case, plaintiff established his title to a valid
patent covering the process in question, and obtained against this defendant a
judgment, granting a perpetual injunction restraining its infringement, which
judgment was affirmed by this Court on appeal. The order was couched in the
following terms:
“It is ordered that the defendant abstain from manufacturing canes and umbrellas
with a curved handle by means of a lamp or blowpipe fed with mineral oil or
petroleum, which process was protected by patent no. 19288, issued in favor of
Henry Gsell, and by him transferred to Carlos Gsell”.
Whether the use of a patented process by a third person, without license or
authority therefore, constitutes an infringement when the alleged infringer has
substituted in lieu of some unessential part of the patented process a well-known
mechanical equivalent.
HELD:
Counsel for plaintiff invokes the doctrine of “mechanical equivalents” in
support of his contention, and indeed that doctrine is applicable to the facts of the
case. This doctrine is founded upon sound rules of reason and logic, and unless
restrained or modified by law in particular jurisdiction, is of universal application, so
that it matters not whether a patent be issued by one sovereignty or another, the
doctrine may properly be invoked to protect the patentee from colorable invasions of
his patent under the guise of a substitution of some part of his invention by some
well-known mechanical equivalent.
The use of a process in all respects identical with a process protected by a
valid patent, save only that a well-known mechanical equivalent is substituted in lieu
of some particular part of the patented process is an infringement upon the rights of
the owner of the patent, which will be enjoined in appropriate proceeding, and the
use of such process, after the order enjoining its use has been issued, is a “contempt”,
under the provision of section 172 of the Code of Civil Procedure.

Thereafter the defendant continued to manufacture curved cane handles for

walking sticks and umbrellas by a process in all respects identical with that used by
the plaintiff under his patent, except only that he substituted for a lamp fed with
petroleum or mineral oil, a lamp fed with alcohol.

The trial court found the defendant “not guilty” of contempt as charged; and
this court, on appeal, held that “The violation, if there has been any, was not of such
a character that it could be made patent by the mere annunciation of the acts
performed by the defendant, which are alleged to constitute the said violation.
Consequently, the contempt with which the accused is charged has not been fully
and satisfactorily proved, and the order appealed from should accordingly be
affirmed in so far as it holds that the defendant is not guilty of contempt.

Substantially, the same question is submitted in these new proceedings as that

submitted in the former case.

ISSUE:
 [G. R. No. 126627. August 14, 2003]
SMITH KLINE BECKMAN CORPORATION, petitioner, vs. THE
HONORABLE COURT OF APPEALS and TRYCO PHARMA
CORPORATION, respondents.
DECISION
CARPIO-MORALES, J.:
Smith Kline Beckman Corporation (petitioner), a corporation existing by virtue
of the laws of the state of Pennsylvania, United States of America (U.S.) and
licensed to do business in the Philippines, filed on October 8, 1976, as assignee,
before the Philippine Patent Office (now Bureau of Patents, Trademarks and
Technology Transfer) an application for patent over an invention entitled Methods
and Compositions for Producing Biphasic Parasiticide Activity Using Methyl 5
Propylthio-2-Benzimidazole Carbamate. The application bore Serial No. 18989.
On September 24, 1981, Letters Patent No. 14561 [1] for the aforesaid invention
was issued to petitioner for a term of seventeen (17) years.
The letters patent provides in its claims[2] that the patented invention consisted
of a new compound named methyl 5 propylthio-2-benzimidazole carbamate and the
methods or compositions utilizing the compound as an active ingredient in fighting
infections caused by gastrointestinal parasites and lungworms in animals such as
swine, sheep, cattle, goats, horses, and even pet animals.
Tryco Pharma Corporation (private respondent) is a domestic corporation that
manufactures, distributes and sells veterinary products including Impregon, a drug
that has Albendazole for its active ingredient and is claimed to be effective against
gastro-intestinal roundworms, lungworms, tapeworms and fluke infestation in
carabaos, cattle and goats.
Petitioner sued private respondent for infringement of patent and unfair
competition before the Caloocan City Regional Trial Court (RTC). [3] It claimed that
its patent covers or includes the substance Albendazole such that private respondent,
by manufacturing, selling, using, and causing to be sold and used the drug Impregon
without its authorization, infringed Claims 2, 3, 4, 7, 8 and 9 of Letters Patent No.
14561[4] as well as committed unfair competition under Article 189, paragraph 1 of
the Revised Penal Code and Section 29 of Republic Act No. 166 (The Trademark
Law) for advertising and selling as its own the drug Impregon although the same
contained petitioners patented Albendazole.[5]
On motion of petitioner, Branch 125 of the Caloocan RTC issued a temporary
restraining order against private respondent enjoining it from committing acts of
patent infringement and unfair competition.[6] A writ of preliminary injunction was
subsequently issued.[7]
Private respondent in its Answer[8] averred that Letters Patent No. 14561 does
not cover the substance Albendazole for nowhere in it does that word appear; that
even if the patent were to include Albendazole, such substance is unpatentable; that
the Bureau of Food and Drugs allowed it to manufacture and market Impregon with
Albendazole as its known ingredient; that there is no proof that it passed off in any
way its veterinary products as those of petitioner; that Letters Patent No. 14561 is
null and void, the application for the issuance thereof having been filed beyond the
one year period from the filing of an application abroad for the same invention
covered thereby, in violation of Section 15 of Republic Act No. 165 (The Patent
Law); and that petitioner is not the registered patent holder.
Private respondent lodged a Counterclaim against petitioner for such amount of
actual damages as may be proven; P1,000,000.00 in moral damages; P300,000.00 in
exemplary damages; and P150,000.00 in attorneys fees.
Finding for private respondent, the trial court rendered a Decision dated July
23, 1991,[9] the dispositive portion of which reads:
WHEREFORE, in view of the foregoing, plaintiffs complaint should be, as it is
hereby, DISMISSED. The Writ of injunction issued in connection with the case is
hereby ordered DISSOLVED.
The Letters Patent No. 14561 issued by the then Philippine Patents Office is hereby
declared null and void for being in violation of Sections 7, 9 and 15 of the Patents
Law.
Pursuant to Sec. 46 of the Patents Law, the Director of Bureau of Patents is hereby
directed to cancel Letters Patent No. 14561 issued to the plaintiff and to publish such
cancellation in the Official Gazette.
Defendant Tryco Pharmaceutical Corporation is hereby awarded P330,000.00 actual
damages and P100,000.00 attorneys fees as prayed for in its counterclaim but said
amount awarded to defendant is subject to the lien on correct payment of filing fees.
SO ORDERED. (Underscoring supplied)
On appeal, the Court of Appeals, by Decision of April 21, 1995, [10] upheld the
trial courts finding that private respondent was not liable for any infringement of the
patent of petitioner in light of the latters failure to show that Albendazole is the same
as the compound subject of Letters Patent No. 14561. Noting petitioners admission
of the issuance by the U.S. of a patent for Albendazole in the name of Smith Kline
and French Laboratories which was petitioners former corporate name, the appellate
court considered the U.S. patent as implying that Albendazole is different from
methyl 5 propylthio-2-benzimidazole carbamate. It likewise found that private
respondent was not guilty of deceiving the public by misrepresenting that Impregon
is its product.
The appellate court, however, declared that Letters Patent No. 14561 was not
void as it sustained petitioners explanation that Patent Application Serial No. 18989
which was filed on October 8, 1976 was a divisional application of Patent
Application Serial No. 17280 filed on June 17, 1975 with the Philippine Patent
Office, well within one year from petitioners filing on June 19, 1974 of its Foreign
Application Priority Data No. 480,646 in the U.S. covering the same compound
subject of Patent Application Serial No. 17280.
Applying Section 17 of the Patent Law, the Court of Appeals thus ruled that
Patent Application Serial No. 18989 was deemed filed on June 17, 1995 or still
within one year from the filing of a patent application abroad in compliance with the
one-year rule under Section 15 of the Patent Law. And it rejected the submission that
the compound in Letters Patent No. 14561 was not patentable, citing the
jurisprudentially established presumption that the Patent Offices determination of
patentability is correct. Finally, it ruled that petitioner established itself to be the one
and the same assignee of the patent notwithstanding changes in its corporate
name. Thus the appellate court disposed:
WHEREFORE, the judgment appealed from
is AFFIRMED with the MODIFICATION that the
orders for the nullification of Letters Patent No. 14561
and for its cancellation are deleted therefrom.
SO ORDERED.
Petitioners motion for reconsideration of the Court of Appeals decision having
been denied[11] the present petition for review on certiorari[12] was filed, assigning as
errors the following:
I. THE COURT OF APPEALS GRAVELY ERRED IN NOT FINDING
THAT ALBENDAZOLE, THE ACTIVE INGREDIENT IN TRYCOS
IMPREGON DRUG, IS INCLUDED IN PETITIONERS LETTERS
PATENT NO. 14561, AND THAT CONSEQUENTLY TRYCO IS
ANSWERABLE FOR PATENT INFRINGEMENT.
II. THE COURT OF APPEALS GRAVELY ERRED IN
AWARDING TO PRIVATE RESPONDENT TRYCO PHARMA
CORPORATION P330,000.00 ACTUAL DAMAGES AND
P100,000.00 ATTORNEYS FEES.
Petitioner argues that under the doctrine of equivalents for determining patent
infringement, Albendazole, the active ingredient it alleges was appropriated by
private respondent for its drug Impregon, is substantially the same as methyl 5
propylthio-2-benzimidazole carbamate covered by its patent since both of them are
meant to combat worm or parasite infestation in animals. It cites the unrebutted
testimony of its witness Dr. Godofredo C. Orinion (Dr. Orinion) that the chemical
formula in Letters Patent No. 14561 refers to the compound Albendazole.Petitioner
adds that the two substances substantially do the same function in substantially the
same way to achieve the same results, thereby making them truly identical. Petitioner
thus submits that the appellate court should have gone beyond the literal wordings
used in Letters Patent No. 14561, beyond merely applying the literal infringement
test, for in spite of the fact that the word Albendazole does not appear in petitioners
letters patent, it has ably shown by evidence its sameness with methyl 5 propylthio-
2-benzimidazole carbamate.
Petitioner likewise points out that its application with the Philippine Patent
Office on account of which it was granted Letters Patent No. 14561 was merely a
divisional application of a prior application in the U. S. which granted a patent for
Albendazole. Hence, petitioner concludes that both methyl 5 propylthio-2-
benzimidazole carbamate and the U.S.-patented Albendazole are dependent on each
other and mutually contribute to produce a single result, thereby making
Albendazole as much a part of Letters Patent No. 14561 as the other substance is.
Petitioner concedes in its Sur-Rejoinder[13] that although methyl 5 propylthio-2-
benzimidazole carbamate is not identical with Albendazole, the former is an
improvement or improved version of the latter thereby making both substances still
substantially the same.
With respect to the award of actual damages in favor of private respondent in
the amount of P330,000.00 representing lost profits, petitioner assails the same as
highly speculative and conjectural, hence, without basis. It assails too the award
of P100,000.00 in attorneys fees as not falling under any of the instances enumerated
by law where recovery of attorneys fees is allowed.
In its Comment,[14] private respondent contends that application of the doctrine
of equivalents would not alter the outcome of the case, Albendazole and methyl 5
propylthio-2-benzimidazole carbamate being two different compounds with different
chemical and physical properties. It stresses that the existence of a separate U.S.
patent for Albendazole indicates that the same and the compound in Letters Patent
No. 14561 are different from each other; and that since it was on account of a
divisional application that the patent for methyl 5 propylthio-2-benzimidazole
carbamate was issued, then, by definition of a divisional application, such a
compound is just one of several independent inventions alongside Albendazole under
petitioners original patent application.
As has repeatedly been held, only questions of law may be raised in a petition
for review on certiorari before this Court. Unless the factual findings of the appellate
court are mistaken, absurd, speculative, conjectural, conflicting, tainted with grave
abuse of discretion, or contrary to the findings culled by the court of origin, [15] this
Court does not review them.
 From an examination of the evidence on record, this Court finds nothing infirm
in the appellate courts conclusions with respect to the principal issue of whether
private respondent committed patent infringement to the prejudice of petitioner.
The burden of proof to substantiate a charge for patent infringement rests on the
plaintiff.[16] In the case at bar, petitioners evidence consists primarily of its Letters
Patent No. 14561, and the testimony of Dr. Orinion, its general manager in the
Philippines for its Animal Health Products Division, by which it sought to show that
its patent for the compound methyl 5 propylthio-2-benzimidazole carbamate also
covers the substance Albendazole.
From a reading of the 9 claims of Letters Patent No. 14561 in relation to the
other portions thereof, no mention is made of the compound Albendazole. All that
the claims disclose are:the covered invention, that is, the compound methyl 5
propylthio-2-benzimidazole carbamate; the compounds being anthelmintic but
nontoxic for animals or its ability to destroy parasites without harming the host
animals; and the patented methods, compositions or preparations involving the
compound to maximize its efficacy against certain kinds of parasites infecting
specified animals.
When the language of its claims is clear and distinct, the patentee is bound
thereby and may not claim anything beyond them.[17] And so are the courts bound
which may not add to or detract from the claims matters not expressed or necessarily
implied, nor may they enlarge the patent beyond the scope of that which the inventor
claimed and the patent office allowed, even if the patentee may have been entitled to
something more than the words it had chosen would include. [18]
It bears stressing that the mere absence of the word Albendazole in Letters
Patent No. 14561 is not determinative of Albendazoles non-inclusion in the claims of
the patent. While Albendazole is admittedly a chemical compound that exists by a
name different from that covered in petitioners letters patent, the language of Letter
Patent No. 14561 fails to yield anything at all regarding Albendazole. And no
extrinsic evidence had been adduced to prove that Albendazole inheres in petitioners
patent in spite of its omission therefrom or that the meaning of the claims of the
patent embraces the same.
While petitioner concedes that the mere literal wordings of its patent cannot
establish private respondents infringement, it urges this Court to apply the doctrine
of equivalents.
The doctrine of equivalents provides that an infringement also takes place when
a device appropriates a prior invention by incorporating its innovative concept and,
although with some modification and change, performs substantially the same
function in substantially the same way to achieve substantially the same
result.[19] Yet again, a scrutiny of petitioners evidence fails to convince this Court of
the substantial sameness of petitioners patented compound and Albendazole. While
both compounds have the 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.[20] In other words, the principle or mode of operation must be the same or
substantially the same.[21]
The doctrine of equivalents thus requires satisfaction of the function-means-
and-result test, the patentee having the burden to show that all three components of
such equivalency test are met.[22]
As stated early on, petitioners evidence fails to explain how Albendazole is in
every essential detail identical to methyl 5 propylthio-2-benzimidazole
carbamate. Apart from the fact that Albendazole is an anthelmintic agent like methyl
5 propylthio-2-benzimidazole carbamate, nothing more is asserted and accordingly
substantiated regarding the method or means by which Albendazole weeds out
parasites in animals, thus giving no information on whether that method is
substantially the same as the manner by which petitioners compound works. The
testimony of Dr. Orinion lends no support to petitioners cause, he not having been
presented or qualified as an expert witness who has the knowledge or expertise on
the matter of chemical compounds.
As for the concept of divisional applications proffered by petitioner, it comes
into play when two or more inventions are claimed in a single application but are of
such a nature that a single patent may not be issued for them. [23] The applicant thus is
required to divide, that is, to limit the claims to whichever invention he may elect,
whereas those inventions not elected may be made the subject of separate
applications which are called divisional applications.[24] What this only means is that
petitioners methyl 5 propylthio-2-benzimidazole carbamate is an invention distinct
from the other inventions claimed in the original application divided out,
Albendazole being one of those other inventions. Otherwise, methyl 5 propylthio-2-
benzimidazole carbamate would not have been the subject of a divisional application
if a single patent could have been issued for it as well as Albendazole.
The foregoing discussions notwithstanding, this Court does not sustain the
award of actual damages and attorneys fees in favor of private respondent. The
claimed actual damages of P330,000.00 representing lost profits or revenues incurred
by private respondent as a result of the issuance of the injunction against it,
computed at the rate of 30% of its alleged P100,000.00 monthly gross sales for
eleven months, were supported by the testimonies of private respondents
President[25] and Executive Vice-President that the average monthly sale of Impregon
was P100,000.00 and that sales plummeted to zero after the issuance of the
injunction.[26] While indemnification for actual or compensatory damages covers not
only the loss suffered (damnum emergens) but also profits which the obligee failed to
obtain (lucrum cessans or ganacias frustradas), it is necessary to prove the actual
amount of damages with a reasonable degree of certainty based on competent proof
and on the best evidence obtainable by the injured party.[27] The testimonies of
private respondents officers are not the competent proof or best evidence obtainable
to establish its right to actual or compensatory damages for such damages also
require presentation of documentary evidence to substantiate a claim therefor. [28]
 In the same vein, this Court does not sustain the grant by the appellate court of HELD: No. The granting is a valid exercise of police power. Cimetidine is
attorneys fees to private respondent anchored on Article 2208 (2) of the Civil Code, medicinal in nature, and therefore necessary for the promotion of public health and
private respondent having been allegedly forced to litigate as a result of petitioners safety.
suit. Even if a claimant is compelled to litigate with third persons or to incur
On the second contention, Section A(2) of Article 5 [of the Paris Convention]
expenses to protect its rights, still attorneys fees may not be awarded where no
unequivocally and explicitly respects the right of member countries to adopt
sufficient showing of bad faith could be reflected in a partys persistence in a case
legislative measures to provide for the grant of compulsory licenses to prevent
other than an erroneous conviction of the righteousness of his cause.[29]There exists
abuses which might result from the exercise of the exclusive rights conferred by the
no evidence on record indicating that petitioner was moved by malice in suing
patent. An example provided of possible abuses is “failure to work;” however, as
private respondent.
such, is merely supplied by way of an example, it is plain that the treaty does not
This Court, however, grants private respondent temperate or moderate damages preclude the inclusion of other forms of categories of abuses. The legislative intent in
in the amount of P20,000.00 which it finds reasonable under the circumstances, it the grant of a compulsory license was not only to afford others an opportunity to
having suffered some pecuniary loss the amount of which cannot, from the nature of provide the public with the quantity of the patented product, but also to prevent the
the case, be established with certainty.[30] growth of monopolies. Certainly, the growth of monopolies was among the abuses
which Section A, Article 5 of the Convention foresaw, and which our Congress
WHEREFORE, the assailed decision of the Court of Appeals is hereby likewise wished to prevent in enacting.
AFFIRMED with MODIFICATION. The award of actual or compensatory damages
and attorneys fees to private respondent, Tryco Pharma Corporation, is DELETED;
instead, it is hereby awarded the amount of P20,000.00 as temperate or moderate
damages.
SO ORDERED.
368 SCRA 9 – Mercantile Law – Law on Intellectual Property – Law on Patents –
Compulsory License
In August 1989, Danlex Research Laboratories petitioned before Bureau of Patents,
Trademarks and Technology Transfer (BPTTT) that it may be granted a compulsory
license for the use and manufacture of the pharmaceutical product Cimetidine.
Cimetidine is useful as an antihistamine and in the treatment of ulcers. Cimetidine is
originally patented to Smith Kline and French Laboratories, Ltd. in 1978, and the
said patent is still in force at the time of application by Danlex Research.
The BPTTT granted the application of Danlex Research together with a provision
that Danlex Research should be paying 2.5% of the net wholesale price as royalty
payment to Smith Kline. This was affirmed by the Court of Appeals.
Smith Kline assailed the grant as it argued, among others, that the same is an invalid
exercise of police power because there is no overwhelming public necessity for such
grant considering that Smith Kline is able to provide an adequate supply of it to
satisfy the needs of the Philippine market; that a provision in the Philippine Patent
Laws is violative of the Paris Convention to which the Philippines is a signatory.
To explain the second contention, Smith Kline states that the Paris Convention only
allows compulsory licensing if the original licensee (patent holder) has failed to
work on the patent; that therefore, the provision in the Philippine Patent Laws which
adds other grounds for the granting of compulsory license i.e. monopoly, is invalid
and contrary to the Paris Convention.
ISSUE: Whether or not Smith Kline is correct.
 G.R. No. 118708. February 2, 1998]
CRESER PRECISION SYSTEMS, INC., petitioner, vs. COURT OF APPEALS
AND FLORO INTERNATIONAL CORP., respondents.
DECISION
MARTINEZ, J.:
This petition for review on certiorari assails the decision[1]. The decision of the
Court of Appeals was penned by Justice Gloria C. Paras and concurred in by Justice
Salome A. Montoya and Justice Hector L. Hofilea.
1 of the Court of Appeals dated November 9, 1994 in C.A.-G.R. SP. No. 34425
entitled Floro International Corp. vs. Hon. Tirso D.C Cruz and Creser Precision
System, Inc., the dispositive portion of which reads:
WHEREFORE, THE PETITION IS HEREBY GRANTED. THE COMPLAINT
FOR INJUNCTION AND DAMAGES, CIVIL CASE NO. 93-1856 BEFORE THE
RESPONDENT JUDGE IS HEREBY ORDERED DISMISSED AND HIS
ORDERS THEREIN OF DECEMBER 29, 1993 AND MAY 11, 1994 ARE
ORDERED SET ASIDE.
Private respondent is a domestic corporation engaged in the manufacture,
production, distribution and sale of military armaments, munitions, airmunitions and
other similar materials.[2]
On January 23, 1990, private respondent was granted by the Bureau of Patents,
Trademarks and Technology Transfer (BPTTT), a Letters Patent No. UM-
6938[3] covering an aerial fuze which was published in the September-October 1990,
Vol. III, No. 5 issue of the Bureau of Patents Official Gazette. [4]
Sometime in November 1993, private respondent, through its president, Mr.
Gregory Floro, Jr., discovered that petitioner submitted samples of its patented aerial
fuze to the Armed Forces of the Philippines (AFP) for testing. He learned that
petitioner was claiming the aforesaid aerial fuze as its own and planning to bid and
manufacture the same commercially without license or authority from private
respondent. To protect its right, private respondent on December 3, 1993, sent a
letter[5] to petitioner advising it fro its existing patent and its rights thereunder,
warning petitioner of a possible court action and/or application for injunction, should
it proceed with the scheduled testing by the military on December 7, 1993.
In response to private respondents demand, petitioner filed on December 8,
1993 a complaint[6] for injunction and damages arising from the alleged infringement
before the Regional Trial Court of Quezon City, Branch 88. The complaint alleged,
among others: that petitioner is the 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.
On December 10, 1993, the trial court issued a temporary restraining order.
Thereafter, hearings were held on the application of petitioner for the issuance of a
writ of preliminary injunction, with both parties presenting their evidence. After the
hearings, the trial court directed the parties to submit their respective memoranda in
support of their positions.
On December 27, 1993, private respondent submitted its
memorandum[7] alleging that petitioner has no cause of action to file a complaint of
infringement against it since it has no patent for the aerial fuze which it claims to
have invented; that petitioners available remedy is to file a petition for cancellation
of patent before the Bureau of Patents; that private respondent as the patent holder
cannot be stripped of its property right over the patented aerial fuze consisting of the
exclusive right to manufacture, use and sell the same and that it stands to suffer
irreparable damage and injury if it is enjoined from the exercise of its property right
over its patent.
On December 29, 1993, the trial court issued an Order [8] granting the issuance
of a writ of preliminary injunction against private respondent the dispositive portion
of which reads:
WHEREFORE, plaintiffs application for the issuance of a writ of preliminary
injunction is granted and, upon posting of the corresponding bond by plaintiff in the
amount of PHP 200,000.00, let the writ of preliminary injunction be issued by the
branch Clerk of this Court enjoining the defendant and any and all persons acting on
its behalf or by and under its authority, from manufacturing, marketing and/or selling
aerial fuzes identical, to those of plaintiff, and from profiting therefrom, and/or from
performing any other act in connection therewith until further orders from this Court.
Private respondent moved for reconsideration but this was denied by the trial
courts in its Order[9] of May 11, 1994, pertinent portions of which read:
For resolution before this Court is the Motion for Reconsideration filed by the
defendant and the plaintiffs Opposition thereto. The Court finds no sufficient cause
to reconsider its order dated December 29, 1993. During the hearing for the issuance
of the preliminary injunction, the plaintiff has amply proven its entitlement to the
relief prayed for. It is undisputed that the plaintiff has developed its aerial fuze way
back in 1981 while the defendant began manufacturing the same only in 1987. Thus,
it is only logical to conclude that it was the plaintiffs aerial fuze that was copied or
imitated which gives the plaintiff the right to have the defendant enjoined from
manufacturing, marketing and/or selling aerial fuzes identical to those of the
plaintiff, and from profiting therefrom and/or performing any other act in connection
therewith until further orders from this Court. With regards to the defendants
assertion that an action for infringement may only be brought by anyone possessing
right, title or interest to the patented invention, (Section 42, RA 165) qualified by
Section 10, RA 165 to include only the first true and actual inventor, his heirs, legal
representatives to assignees, this court finds the foregoing to be untenable. Sec. 10
merely enumerates the persons who may have an invention patented which does not
necessarily limit to these persons the right to institute an action for infringement.
Defendant further contends that the order in issue is disruptive of the status quo. On
the contrary, the order issued by the Court in effect maintained the status quo. The
last actual , peaceable uncontested status existing prior to this controversy was the
plaintiff manufacturing and selling its own aerial fuzes PDR 77 CB4 which was
ordered stopped through the defendants letter. With issuance of the order, the
operations of the plaintiff continue. Lastly, this court believes that the defendant will
not suffer irreparable injury by virtue of said order. The defendants claim is
primarily hinged on its patent (Letters Patent No. UM-6983) the validity of which is
being questioned in this case.
WHEREFORE, premises considered, the Motion for Reconsideration is hereby
denied for lack of merit.
SO ORDERED.
Aggrieved, private respondent on June 27, 1994, filed a petition for certiorari,
mandamus and prohibition[10]before respondent Court of Appeals raising as grounds
the following:
a. Petitioner has no cause of action for infringement against private
respondent, the latter not having any patent for the aerial fuze
which it claims to have invented and developed and allegedly
infringed by private respondent;
b. The case being an action for cancellation or invalidation of private
respondents Letters Patent over its own aerial fuze, the proper
venue is the Office of the Director of Patents;
c. The trial court acted in grave abuse of discretion and or in excess of
jurisdiction in finding that petitioner has fully established its clear
title or right to preliminary injunction;
d. The trial court acted in grave abuse of discretion and/or in excess of
jurisdiction in granting the preliminary injunction, it being
disruptive of the status quo; and
e. The trial court acted in grave abuse of discretion and/or in excess of
jurisdiction in granting the preliminary injunction thereby
depriving private respondent of its property rights over the
patented aerial fuze and cause it irreparable damages.
On November 9, 1994, the respondent court rendered the now assailed decision
reversing the trial courts Order of December 29, 1993 and dismissing the complaint
filed by petitioner.
The motion for reconsideration was also denied on January 17, 1995. [11] Hence,
this present petition.
It is petitioners contention that it can file, under Section 42 of the Patent Law
(R.A. 165), an action for infringement not as a patentee but as an entity in possession
of a right, title or interest in and to the patented invention. It advances the theory that
while the absence of a patent may prevent one from lawfully suing another for
infringement of said patent, such absence does not bar the first true and actual
inventor of the patented invention from suing another who was granted a patent in a
suit for declaratory or injunctive relief recognized under American patent laws. This
remedy, petitioner points out, may be likened to a civil action for infringement under
Section 42 of the Philippine Patent Law.
We find the above arguments untenable.
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
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.[12] Moreover, there can be no infringement of a patent until a patent has been
issued, since whatever right one has to the invention covered by the patent arises
alone from the grant of patent.[13] In short, a person or entity who has not been
granted letters patent over an invention and has not acquired any 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. [14]
Petitioner admits it has no patent over its aerial fuze. Therefore, it has no legal
basis or cause of action to institute the petition for injunction and damages arising
from the alleged infringement by private respondent. While petitioner claims to be
the 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.[15]
Further, the remedy of declaratory judgment or injunctive suit on patent
invalidity relied upon by petitioner cannot be likened to the civil action for
infringement under Section 42 of the Patent Law. The reason for this is that the said
remedy is available only to the patent holder or his successors-in-interest. Thus,
anyone who has no patent over an invention but claims to have a right or interest
thereto can not 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.
In the case of Aguas vs. De Leon,[16] 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.
In fine, in the absence of error or abuse of power or lack or jurisdiction or grave
abuse of discretion, we sustain the assailed decision of the respondent Court of
Appeal.
WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED.
No pronouncement as to costs.
SO ORDERED.
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
petitioner’s 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.
ssue:
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 patentee’s successors-in-interest, assignees or grantees since the action on patent
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. Respondent’s aerial fuze is covered by letter 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.
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