Republic of the Philippines infringement of said patents and therefore its immediate discontinuance is demanded, otherwise it
SUPREME COURT will be compelled to take judicial action. (Rollo, pp. 7-8).
Manila
SECOND DIVISION
G.R. L-45101 November 28, 1986
ROSARIO C. MAGUAN (formerly ROSARIO C. TAN), petitioner,
vs.
THE HONORABLE COURT OF APPEALS and SUSANA LUCHAN, respondents.
Ambrosio Padilla Law Offices for petitioner.
PARAS, J.:p
Submitted on December 9, 1977 for Our decision is this petition for review on certiorari of the two
Resolutions of the Court of Appeals, the first dated July 6, 1976, setting aside its Decision of
February 16, 1976 in CA-G.R. No. SP-04706, titled "SUSANA LUCHAN v. Hon. HONRADO, et
al." wherein it ruled for the dismissal of the petition for lack of merit and at the same time nullifying
the writ of preliminary injunction it had previously issued; and the second, dated November 4,
1976, denying the motion for reconsideration of the first resolution above-mentioned.
Petitioner is doing business under the firm name and style of SWAN MANUFACTURING" while
private respondent is likewise doing business under the firm name and style of "SUSANA
LUCHAN POWDER PUFF MANUFACTURING."
It is undisputed that petitioner is a patent holder of powder puff namely:
1. UM-423 (extended and/or renewed under Extension No. UM-
109 for a period of 5 years from October 6, 1971)
2. UM-450 (extended and/or renewed under Extension No.
UM110 for a period of 5 years from January 26, 1972)
3. UM 1184, for a period of 5years fromApril 5, 1974.(Petition,
Rollo, pp. 6-7).
In a letter dated July 10, 1974 (Annex "D", Rollo, p. 86), petitioner informed private respondent
that the powder puffs the latter is manufacturing and selling to various enterprises particularly
those in the cosmetics industry, resemble Identical or substantially Identical powder puffs of which
the former is a patent holder under Registration Certification Nos. Extension UM-109, Extension
UM-110 and Utility Model No. 1184; petitioner explained such production and sale constitute
Private respondent replied stating that her products are different and countered that petitioner's
patents are void because the utility models applied for were not new and patentable and the
person to whom the patents were issued was not the true and actual author nor were her rights
derived from such author. (Taken from allegations in the Answer, par. 4, Rollo, p. 93). And on July
25, 1974, private respondent assailed the validity of the patents involved and filed with the
Philippine Patent Office petitions for cancellation of (1) Utility Model Letter Patent Extension No.
UM-109 (Inter Partes Case No. 838, Susana Luchan v. Rosario C. Tan), (2) Utility Model Letters
Patent No. UM-1184 (Inter Partes Case No. 839, Susana Luchan v. Rosario C. Tan), (3) Utility
Model Letters Patent Extension No. UM-110 (Inter Partes Case No. 840, Susana Luchan v.
Rosario C. Tan. (Taken from allegations in the Answer, par. 10, Rollo, pp. 94-95).
In view thereof, petitioner, on August 24, 1974, filed a complaint for damages with injunction and
preliminary injunction against private respondent with the then Court of First Instance of Rizal,
Pasig Branch, docketed as Civil Case No. 19908, for infringing the aforesaid letters patent, and
prayed, among others, that a writ of preliminary injunction be immediately issued (Complaint,
Rollo, p. 90).
In her answer, private respondent alleged that the products she is manufacturing and offering for
sale are not Identical, or even only substantially Identical to the products covered by petitioner's
patents and, by way of affirmative defenses, further alleged that petitioner's patents in question
are void on the following grounds:
(1) at the time of filing of application for the patents involved, the
utility models applied for were not new and patentable under
Sec. 55 of R.A. 165, as amended by R.A. 864; and
(2) the person to whom the patents were issued was not the
true and actual author of the utility models applied for, and
neither did she derive her rights from any true and actual author
of these utility models.
for the following reasons:
(a) since years prior to the filing of applications for the patents
involved, powder puffs of the kind applied for were then already
existing and publicly being sold in the market; both in the
Philippines and abroad; and
(b) applicant's claims in her applications, of "construction" or
process of manufacturing the utility models applied for, with
respect to UM-423 and UM-450, were but a complicated and
impractical version of an old, simple one which has been well
known to the cosmetics industry since years previous to her
filing of applications, and which belonged to no one except to
 the general public; and with respect to UM1184; her claim in her
application of a unitary powder puff, was but an limitation of a
product well known to the cosmetics industry since years
previous to her firing of application, and which belonged to no
one except to the general public; (Answer, Rollo, pp. 93-94).
On September 18, 1974, the trial court issued an Order (Annex "K", Rollo, p. 125) granting the
preliminary injunction prayed for by petitioner. Consequently, the corresponding writ was
subsequently issued (Annex "K-1", Rollo, p. 131) enjoining the herein private respondent (then
defendant) and all other persons employed by her, her agents, servants and employees from
directly or indirectly manufacturing, making or causing to be made, selling or causing to be sold, or
using or causing to be used in accordance with, or embodying the utility models of the Philippine
Patent Office Utility Model Letters Patent Nos. 423 (Extension No. UM-109), No. 450 (Extension
No. UM-110), and Utility Model No. 1184 or from infringement upon or violating said letters patent
in any way whatsoever (Annex " K-1 ", Rollo, p. 131).
Private respondent questioned the propriety of the trial court's issuance of the Writ of Preliminary
Injunction arguing that since there is still a pending cancellation proceedings before the Philippine
Patent Office concerning petitioner's patents, such cannot be the basis for preliminary injunction
(Motion for Reconsideration, Rollo, p. 132).
In an Order dated September 11, 1975, the trial court denied private respondent's motion for
reconsideration (Annex "N", Rollo, p. 142).
In challenging these Orders private respondent filed a petition for certiorari with the respondent
court on September 29, 1975 (Annex "D", Rollo, pp. 148-171) reiterating among other things the
invalidity of petitioner's patents and prayed that the trial court be restrained from enforcing or
continuing to enforce the following:
(1) Order dated September 18, 1974, granting the preliminary
injunction;
(2) Writ of preliminary injunction dated September 18, 1974; and
(3) Order dated September 11, 1974 denying petitioner's motion
petition for reconsideration.
On October 15, 1975, the Writ of Preliminary Injunction was issued by the respondent Court of
Appeals as follows:
NOW, THEREFORE, you, respondents, and/or any person/persons acting on
your stead, are hereby ENJOINED to RESTRAIN from enforcing or continuing to
enforce, the proceedings complained of in the petition to wit: 1) Order dated
September 18, 1974, granting the preliminary injunction; 2) Writ of Preliminary
Injunction dated September 18, 1974; and Order dated September 11, 1975,
denying petitioner's motion for reconsideration, all issued in connection with Civil
Case No. 19908, UNTIL FURTHER ORDERS FROM THIS COURT. (Annex "P",
Rollo, p. 1.73)
On February 16, 1976, respondent court promulgated a decision the dispositive portion of which
reads:
WHEREFORE, finding no merit in the herein petition, the same is hereby
dismissed and the preliminary injunction previously issued by this Court is hereby
set aside, with costs.
SO ORDERED. (CA Decision, Rollo, p. 189).
ln said decision respondent court stated that in disposing of the petition it tackled only the issue of
whether the court a quo acted with grave abuse of discretion in issuing the challenged orders. It
made clear the question of whether the patents have been infringed or not was not determined
considering the court a quo has yet to decide the case on the merits (Ibid., p. 186).
Feeling aggrieved, private respondent moved to reconsider the afore-mentioned Decision based
on the following grounds:
I
THAT THIS HONORABLE COURT ERRED IN NOT
APPRECIATING THE EXISTENCE OF A FAIR QUESTION OF
INVALIDITY OF PRIVATE RESPONDENT'S PATENTS.
II
THAT THIS HONORABLE COURT ERRED IN NOT
REJECTING THE THEORY OF RESPONDENT JUDGE THAT
HE HAS NO JURISDICTION TO INVALIDATE THE PATENTS
UPON GROUND OF LACK OF NOVELTY OF THE
PRODUCTS PATENTED. (Motion for Reconsideration, Rollo, p.
190).
Reviewing on reconsideration, respondent court gave weight to private respondent's allegation
that the latter's products are not identical or even only substantially identical to the products
covered by petitioner's patents. Said court noticed that contrary to the lower courts position that
the court a quo had no jurisdiction to determine the question of invalidity of the patents, Section 45
and 46 of the Patent Law allow the court to make a finding on the validity or invalidity of patents
and in the event there exists a fair question of its invalidity, the situation calls for a denial of the
writ of preliminary injunction pending the evaluation of the evidence presented (Rollo, pp. 218-
226). Thus, finding the lower court's position to have been opposed to Patent Law, respondent
court considered it a grave abuse of discretion when the court a quo issued the writ being
questioned without looking into the defenses alleged by herein private respondent. Further, it
considered the remedy of appeal, under the circumstances, to be inadequate.
Thus, on July 6, 1976, respondent court made a complete turnabout from its original decision and
promulgated a Resolution, the dispositive portion of which reads:
WHEREFORE, our decision is hereby set aside. The writ of certiorari is ordered
issued. Accordingly, the challenged orders, Exhibit H and H-1 and the order
denying the motion for reconsideration (Annex "K", Petition), are hereby set
aside. The writ of preliminary injunction previously ordered by this Court and
ordered lifted by the Decision now being set aside is hereby reinstated and made
permanent. Without pronouncement as to costs.
SO ORDERED. (CA Resolution, Rollo, p. 226).
In a Resolution dated November 4, 1976, respondent court, not persuaded by the grounds
embodied in the motion for reconsideration filed by herein petitioner (Annex "V ", Rollo, p. 227),
denied the same for lack of merit, thereby maintaining the same stand it took in its July 6, 1976
Resolution (Rollo, p. 281). Hence, this petition.
On December 3, 1976, without giving due course to the petition, this Court required respondent to
file her Comment (Rollo, p. 290) which was filed on December 16, 1976 (Rollo, pp. 291-316).
Thereafter, petitioner filed her Reply (Rollo, p. 323) and on May 30, 1977, the petition was given
due course (Rollo, p. 345). Petitioner filed her brief on July 14, 1977 (Rollo, p. 351) while private
respondent filed her brief on August 25, 1977 (Rollo, p. 359). Thereafter, petitioner having failed to
file reply brief, the Court resolved to declare the case submitted for decision on December 9, 1977
(Rollo, p. 359).
The assignment of errors raised by the petitioner in this case (Rollo, pp. 15-16) may be reduced to
three main issues:
(1) Whether or not in an action for infringement the Court a
quo had jurisdiction to determine the invalidity of the patents at
issue which invalidity was still pending consideration in the
patent office.
(2) Whether or not the Court a quo committed grave abuse of
discretion in the issuance of a writ of preliminary injunction.
(3) Whether or not certiorari is the proper remedy.
The first issue has been laid to rest in a number of cases where the Court ruled that "When a
patent is sought to be enforced, the questions of invention, novelty or prior use, and each of them,
are open to judicial examination." (Vargas v. F.M. Yaptico & Co. 40 Phil. 199 [1919]; Vargas v.
Chua, 57 Phil. 790-791 [1933]; Frank and Gohn v. Kosuyana 59 Phil. 207 [1933]).
Under the present Patent Law, there is even less reason to doubt that the trial court has
jurisdiction to declare the patents in question invalid. A patentee shall have the exclusive right to
make, use and sell the patented article or product and the making, using, or selling by any person
without the authorization of the patentee constitutes infringement of the patent (Sec. 37, R.A. 165).
Any patentee whose rights have been infringed upon may bring an action before the proper CFI
now (RTC) and to secure an injunction for the protection of his rights (Sec. 42, R.A. 165).
Defenses in an action for infringement are provided for in Section 45 of the same law which in fact
were availed of by private respondent in this case. Then, as correctly stated by respondent Court
of Appeals, this conclusion is reinforced by Sec. 46 of the same law which provides that if the
Court shall find the patent or any claim thereof invalid, the Director shall on certification of the final
judgment ... issue an order cancelling the patent or the claims found invalid and shall publish a
notice thereof in the Official Gazette." Upon such certification, it is ministerial on the part of the
patent office to execute the judgment. (Rollo, pp. 221-222).
II.
The burden of proof to substantiate a charge of infringement is with the plaintiff. But where the
plaintiff introduces the patent in evidence, and the same is in due form, there is created a prima
facie presumption of its correctness and validity. The decision of the Commissioner (now Director)
of Patent in granting the patent is presumed to be correct. The burden of going forward with the
evidence (burden of evidence) then shifts to the defendant to overcome by competent evidence
this legal presumption.
The question then in the instant case is whether or not the evidence introduced by private
respondent herein is sufficient to overcome said presumption.
After a careful review of the evidence consisting of 64 exhibits and oral testimonies of five
witnesses presented by private respondents before the Court of First Instance before the Order of
preliminary injunction was issued as well as those presented by the petitioner, respondent Court of
Appeals was satisfied that there is a prima facie showing of a fair question of invalidity of
petitioner's patents on the ground of lack of novelty. As pointed out by said appellate court said
evidence appeared not to have been considered at all by the court a quo for alleged lack of
jurisdiction, on the mistaken notion that such question in within the exclusive jurisdiction of the
patent office.
It has been repeatedly held that an invention must possess the essential elements of novelty ,
originality and precedence and for the patentee to be entitled to protection, the invention must be
new to the world. Accordingly, a single instance of public use of the invention by a patentee for
more than two years (now for more than one year only under Sec. 9 of the Patent Law) before the
date of his application for his patent, will be fatal to, the validity of the patent when issued. (Frank,
et al. v. Kosuyama Vargas v. F.M. Yaptico & Co. and Vargas v. Chua, et al., supra).
The law provides:
SEC. 9. Invention not considered new or patentable. — An invention shall not be
considered new or capable of being patented if it was known or used by others in
the Philippines before the invention thereof by the inventor named in an
application for patent for the invention; or if it was patented or described in any
printed publication in the Philippines or any foreign country more than one year
before the application for a patent therefor; or if it had been in public use or on
 sale in the Philippines for more than one year before the application for a patent
therefor; or if it is the subject matter of a validity issued patent in the Philippines
granted on an application filed before the filing of the application for patent
therefor.
Thus, more specifically, under American Law from which our Patent Law was derived (Vargas v.
F.M. Yaptico & Co. supra) it is generally held that in patent cases a preliminary injunction will not
issue for patent infringement unless the validity of the patent is clear and beyond question. The
issuance of letters patent, standing alone, is not sufficient to support such drastic relief (8 Deller's
Walker on Patents p. 406). In cases of infringement of patent no preliminary injunction will be
granted unless the patent is valid and infringed beyond question and the record conclusively
proves the defense is sham. (Ibid., p. 402)
In the same manner, under our jurisprudence, as a general rule because of the injurious
consequences a writ of injunction may bring, the right to the relief demanded must be clear and
unmistakable. (Sangki v. Comelec, 21 SCRA 1392; December 26, 1967) and the dissolution of the
writ is proper where applicant has doubtful title to the disputed property. (Ramos v. C.A., 95 SCRA
359).
III.
notwithstanding the existence of the regular remedy of an appeal in due cause when among other
reasons, the broader interests of justice so require or an ordinary appeal is not an adequate
remedy."
Private respondent maintains the position that the resolutions sought to be appealed from had
long become final and executory for failure of Hon. Reynaldo P. Honrado, the trial court judge, to
appeal by certiorari from the resolutions of respondent Court of Appeals. (Rollo, pp. 291-292).
Such contention is untenable.
There is no dispute that petitioner has seasonably petitioned. On the other hand, it is elementary
that the trial judge is a mere nominal party as clearly provided in Section 5, Rule 65 of the Revised
Rules of Court where it shall be the duty of such person or persons interested in sustaining the
proceedings in court, "to appear and defend, both in his or their own behalf and in behalf of the
court or judge affected by the proceedings."
Relative thereto "the judge whose order is under attack is merely a nominal party; wherefore, a
judge in his official capacity should not be made to appear as a party seeking reversal of a
decision that is unfavorable to the action taken by him." (Hon. Alcasid v. Samson, 102 Phil. 735-
736; Tarona v. Sayo, 67 SCRA 508, 524; Lim Se v. Argel, 70 SCRA 378).

It will be noted that the validity of petitioner's patents is in question for want of novelty. Private
respondent contends that powder puffs Identical in appearance with that covered by petitioner's
patents existed and were publicly known and used as early as 1963 long before petitioner was
issued the patents in question. (List of Exhibits, Rollo, pp. 194-199). As correctly observed by
respondent Court of Appeals, "since sufficient proofs have been introduced in evidence showing a
fair question of the invalidity of the patents issued for such models, it is but right that the evidence
be looked into, evaluated and determined on the merits so that the matter of whether the patents
issued were in fact valid or not may be resolved." (Rollo, pp. 286-287).
As to petitioner's claim of prescription, private respondent's contention that such refers to the filing
of petitions for cancellation in the Patent Office under Sec. 28 of the Patent Law and not to a
defense against an action for infringement under Sec. 45 thereof which may be raised anytime, is
evident under aforesaid law.
PREMISES CONSIDERED, the assailed resolutions of the Court of Appeals are hereby
AFFIRMED.

All these notwithstanding, the trial court nonetheless issued the writ of preliminary injunction which SO ORDERED.
under the circumstances should be denied.
Feria (Chairman), Fernan, Gutierrez, Jr., and Feliciano, * JJ., concur.
For failure to determine first the validity of the patents before aforesaid issuance of the writ, the
trial court failed to satisfy the two requisites necessary if an injunction is to issue, namely: the Alampay, J., took no part.
existence of the right to be protected and the violation of said right. (Buayan Cattle Co., Inc. v.
Quintillan, 128 SCRA 276).

Under the above established principles, it appears obvious that the trial court committed a grave
abuse of discretion which makes certiorari the appropriate remedy.

As found by respondent Court of Appeals, the injunctive order of the trial court is of so general a
tenor that petitioner may be totally barred from the sale of any kind of powder puff. Under the
circumstances, respondent appellate court is of the view that ordinary appeal is obviously
inadequate. (Rollo, p. 288). A parallel was drawn from a decision of the Supreme Court in the
case of Sanchez v. Hon. Court of Appeals, 69 SCRA 328 [1976] where the First Division of the
Supreme Court ruled that "The prerogative writ of certiorari may be applied for by proper petition
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 14101 September 24, 1919
ANGEL VARGAS, plaintiff-appellant,
vs.
F. M. YAPTICO & CO. (Ltd.), defendant-appellee.
Charles C. Cohn for appellants .
John Bordman for appellee.
MALCOLM, J.:
Rude wooden implements for tilling the soil have been in use in the Philippines, possibly not since
the Israelites "went down to sharpen every man his share and his coulter," but certainly for many
years. Iron plows called "Urquijo" and "Pony" have latterly been the vogue.
Angel Vargas, a farmer acquainted with local conditions and alive to the commercial possibilities,
took it upon himself to produce, with the native plow as the model, an improved, adjustable plow.
On July 22, 1910, he made application for a United States patent to cover his so-called invention.
On March 12, 1912, letters patent were issued by the United States Patent Office in favor of
Vargas .On April 24, 1912, a certified copy of the patent was filed in the Division of Patents,
Copyrights, and Trademarks of the Executive Bureau, Government of the Philippine Islands. The
patent and its registry was also published in the newspaper, El Tiempo.
Since 1910, Vargas has engaged in the manufacture of these plows in the city of Iloilo, Philippine
Islands. On the plows there was first stamped the words "Patent Applied For," later after the patent
had been granted, changed to "Patented Mar. 12, 1912." Ninety per cent of the plows in use in the
Visayas (Iloilo and vicinity) are said to be Vargas plows.
During this same period, the firm of F. M. Yaptico & Co. (Ltd.), was engaged in the foundry
business in the City of Iloilo. It openly held itself out as a manufacturer of plow parts. It has in fact
produced points, shares, shoes, and heel pieces in a considerable amount adapted to replace
worn-out parts of the Vargas plow.
Such was the existing situation when, in the early part of 1918, the owner of the patent, and thus
the proper party to institute judicial proceedings, began action in the Court of First Instance of Iloilo
to enjoin the alleged infringement of U.S. Patent No. 1020232 by the defendant F. M Yaptico &
Co. (Ltd.), and to recover the damages suffered by reason of this infringement. The court issued
the preliminary injunction as prayed for. The defendant, in addition to a general denial, alleged, as
special defenses, that the patent lacked novelty or invention, that there was no priority of ideas or
device in the principle and construction of the plow, and that the plow, whose manufacture it was
sought to have enjoined by the plaintiff, had already been in public use for more than two years
before the application of the plaintiff for his patent. The parties subsequently entered into a
stipulation that the court should first resolve the question of whether or not there had been an
infraction of the patent, reserving the resultant question of damages for later decision. After the
taking of evidence, including the presentation of exhibits, the trial judge, the Honorable Antonio
Villareal, in a very exhaustive and learned decision, rendered judgment in favor of the defendant
and against the plaintiff, declaring null and without effect the patent in question and dismissing the
suit with costs against the plaintiff .The preliminary injunction theretofore issued was dissolved.
From this judgment the plaintiff has appealed, specifying five errors. The principal assignment No.
1 is, that the trial court erred in finding that the patented invention of the plaintiff is lacking in
novelty and invention. Defendant, in reply, relies on three propositions, namely: (1) The judgment
of the trial court in finding the patent granted plaintiff void for lack of novelty and invention should
be affirmed; (2) The patent granted plaintiff is void from the public use of his plow for over two
years prior to his application for a patent, and (3) If the patent is valid, there has been no
contributory infringement by defendant.
Before resolving these rival contentions, we should have before us the relevant law. Act No. 2235
of the Philippine Legislature, enacted on February 10, 1913, in effect makes the United States
Patent Laws applicable in the Philippine Islands. It provides that "owners of patents, including
design patents, which have been issued or may hereafter be issued, duly registered in the United
States Patent Office under the laws of the United States relating to the grant of patents, shall
receive in the Philippine Islands the protection accorded them in the United States under said
laws." (Sec. 1.) Turning to the United States Patent Laws, we find the Act of Congress of March 3,
1897, amendatory of section 4886 of the United States Revised Statutes, reading as follows:
Any person who has invented or discovered any new and useful art, machine,
manufacture, or composition of matter, or any new an useful improvements thereof, not
known or used by others in this country, before his invention or discovery thereof, and not
patented or described in any printed publication in this or any foreign country, before his
invention or discovery thereof, or more than two years prior to his application, and not in
public use or on sale in this country for more than two years prior to his application,
unless the same is proved to have been abandoned, may upon payment of the fees
required by law, and other due proceeding had, obtain a patent therefor. (29 Stat. L., 692,
7 Fed .Stat. Ann. [2d Ed.], p. 23.)
When a patent is sought to be enforced, "the question of invention, novelty, or prior use, and each
of them, are open to judicial examination." 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
then shifts to the defendant to overcome by competent evidence this legal presumption .With all
due respect, therefore, for the critical and expert examination of the invention by the United States
Patent Office, the question of the validity of the patent is one for judicial determination, and since a
patent has been submitted, the exact question is whether the defendant has assumed the burden
of proof as to anyone of his defenses. (See Agawan Co. vs. Jordan [1869], 7 Wall., 583;
Blanchard vs .Putnam [1869], 8 Wall., 420; Seymour vs. Osborne [1871], 11 Wall., 516;
Reckendorfer vs. Faber [1876], 92 U.S., 347; 20 R. C. L., 1112, 1168, 1169.)
As herein before stated, the defendant relies on three special defenses. One such defense, on
which the judgment of the lower court is principally grounded, and to which appellant devotes the
major portion of his vigorous argument, concerns the element of novelty, invention, or discovery,
that gives existence to the right to a patent. On this point the trial court reached the conclusion that
"the patented plow of the plaintiff, Exhibit D, is not different from the native plow, Exhibit 2, except
in the material, in the form, in the weight and the grade of the result, the said differences giving it
neither a new function nor a new result distinct from the function and the result obtained from the
native plow; consequently, its production does not presuppose the exercise of the inventive faculty
but merely of mechanical skill, which does not give a right to a patent of an invention under the
provisions of the Patent Law." In thus finding, the court may have been right, since the Vargas
plow does not appear to be such a "combination" as contains a novel assemblage of parts
exhibiting invention. (See Stimpson vs. Woodman [1870], 10 Wall., 117 — rollers; Hicks vs. Kelsey
[1874], 20 Wall., 353 — stoves; Washburn & Moen Mfg. Co. vs. Beat 'Em All Barbed Wire Co.
[1892], 143 U.S., 275 — barbed wire; Lynch vs .Dryden [1873], C. D., 73 — walking cultivators;
Torrey vs. Hancock [1910], 184 Fed., 61 — rotary plows.)
A second line of defense relates to the fact that defendant has never made a complete Vargas
plow, but only points, shares, shoes, and heel pieces, to serve as repairs. Defendant's contention
is, that in common with other foundries, he has for years cast large numbers of plow points and
shares suitable for use either on the native wooden plow, or on the Vargas plow. A difference has
long been recognized between repairing and reconstructing a machine. If, for instance, partial
injuries, whether they occur from accident or from wear and tear, to a machine for agricultural
purposes, are made this is only re-fitting the machine for use, and thus permissible. (Wilson vs.
Simpson [1850], 9 How., 109.) Even under the more rigorous doctrine of Leeds & Catlin Co. vs.
Victor Talking Machine Co. ([1909], 213 U.S., 325), it may be possible that all the defendant has
done is to manufacture and sell isolated parts to be used to replace worn-out parts.
The third defense is, that under the provisions of the statute, an inventor's creation must not have
been in public use or on sale in the United States (and the Philippine Islands) for more than two
years prior to his application .Without, therefore, committing ourselves as to the first two defenses,
we propose to base our decision on the one just suggested as more easily disposing of the case.
(See 20 R. C. L., 1140-1142.) We do so with full consciousness of the doubt which arose in the
mind of the trial court, but with the belief that since it has been shown that the invention was used
in public at Iloilo by others than Vargas, the inventor, more than two years before the application
for the patent, the patent is invalid.
Although we have spent some time in arriving at this point, yet having reached it, the question in
the case is single and can be brought to a narrow compass. Under the English Statute of
Monopolies (21 Jac. Ch., 3), and under the United States Patent Act of February 21, 1793, later
amended to be as herein quoted, it was always the rule, as stated by Lord Coke, Justice Story and
other authorities, that to entitle a man to a patent, the invention must be new to the world.
(Pennock and Sellers vs. Dialogue [1829], 2 Pet., 1.) As said by the United States Supreme Court,
"it has been repeatedly held by this court that a single instance of public use of the invention by a
patentee for more than two years before the date of his application for his patent will be fatal to the
validity of the patent when issued." (Worley vs. Lower Tobacco Co .[1882], 104 U. S., 340;
McClurg vs. Kingsland [1843], I How., 202; Consolidated Fruit Jar Co. vs. Wright [1877], 94 U. S.,
92; Egbert vs. Lippmann [1881], 104 U. S., 333; Coffin vs. Ogden [1874], 18 Wall., 120;
Manning vs. Cape Ann Isinglass and Glue Co. [1883], 108 U. S., 462; Andrews vs. Hovey [1887],
123 U. S., 267; Campbell vs. City of New York [1881], 1 L. R. A., 48.)
On the facts, we think the testimony shows such a public use of the Vargas plow as to render the
patent invalid Nicolas Roces, a farmer, testified that he had bought twenty Vargas plows, of which
Exhibit 5 was one, in December, 1907; and Exhibit 5, the court found, was a plow completely
identical with that for which the plaintiff had received a patent. The minor exception, and this in
itself corroborative of Roces' testimony, is that the handle of plow Exhibit 5 is marked with the
letters "A V" and not with the words "Patent Applied For" or "Patented Mar.12, 1912." Salvador
Lizarraga, a clerk in a business house, testified that he had received plows similar to Exhibits D, 5,
and 4, for sale on commission on May, 1908, from Bonifacio Araneta, partner of Vargas in the
plow business. Ko Pao Ko, a blacksmith, testified that he had made fifty plow frames in 1905 for
Vargas and Araneta, of which Exhibit 4 is one; Exhibit 4, the court found, is a plow identical with
that patented by Vargas, but without share and mould-board. Alfred Berwin, an employee in the
office of Attorney John Bordman, testified that on September 21, 1908, he had knowledge of a
transaction wherein Vargas and Araneta desired to obtain money to invest in a plow factory.
George Ramon Saul, a mechanic of the "Taller Visayas" of Strachan and MacMurray, testified that
he had made Vargas plow points and shares of the present form upon order of Araneta and
Vargas in 1906 and 1907 .William MacMurray, proprietor of the "Taller Visayas," corroborated the
evidence of the witness Saul by the exhibition of the account against Vargas and Araneta wherein,
under date of December 13, 1906, appears the item "12 new soft steel plow shares forged and
bored for rivets as per sample." Against all this, was the testimony of the plaintiff Angel Vargas
who denied that Saul could have been seen the Vargas plow in 1907 and 1907, who denied that
Roces purchased the Vargas plow in 1907, who denied that Lizarraga could have acted as an
agent to sell two plows in November, 1908, who denied any remembrance of the loan mentioned
by Berwin as having been negotiated in September, 1908, who denied that Ko Pao Ko made fifty
plows one of which is Exhibit 4, for Araneta and Vargas in 1905. Plaintiff introduced his books to
substantiate his oral testimony .It is hardly believable that five or six witnesses for the defense
would deliberately perjure themselves under oath. One might, but that all together, of different
nationalities, would enter into such a conspiracy, is to suppose the improbable.
Tested by the principles which go to make the law, we think a preponderance of the evidence is to
the effect that for more than two years before the application for the original letters patent, or
before July 22, 1908, there was, by the consent and allowance of Vargas, a public use of the
invention covered by them.
To conclude, we are not certain but that appellee has proved every one of his defenses. We are
certain that he has at least demonstrated the public use of the Vargas plow over two years prior to
the application for a patent. Such being the case, although on a different ground, we must sustain
the judgment of the lower court, without prejudice to the determination of the damages resulting
from the granting of the injunction, with the costs of this instance against the appellant. So
ordered.
Arellano, C.J. Torres, Johnson, Araullo, Street, Avanceña and Moir, JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-36650 January 27, 1933
ANGEL VARGAS, plaintiff-appellee,
vs.
PETRONILA CHUA, ET AL., defendants-appellants.
Jose F. Orozco for appellants.
Jose Yulo for appellee.
IMPERIAL, J.:
The defendants Petronila Chua, Coo Pao and Coo Teng Hee, appeal from the judgment of the
Court of First Instance of Manila, the dispositive part of which reads as follows:
Wherefore judgment is rendered in favor of the plaintiff and against the defendants,
ordering each and every one of them, their agents, mandatories and attorneys, to
henceforth abstain from making, manufacturing, selling or offering for a sale plows of the
type of those manufactured by the plaintiff, and particularly plows of the model of Exhibits
B, B-1 and B-2, and to render to the plaintiff a detailed accounting of the profits obtained
by them from the manufacture and sale of said type of plows within thirty (30) days from
the date of the receipt by them of notice of this decision, with costs against all of the
defendants.
Angel Vargas, the plaintiff herein, brought this action to restrain the appellants and the other
defendant entity, Cham Samco & Sons, their agents and mandatories, from continuing the
manufacture and sale of plows similar to his plow described in his patent No. 1,507,530 issued by
the United States Patent Office on September 2, 1924; and to compel all of said defendants, after
rendering an accounting of the profits obtained by them from the sale of said plows from
September 2, 1924, to pay him damages equivalent to double the amount of such profits.
It appears from the bill of exceptions that Cham Samco & Sons did not appeal.
In addition to the evidence presented, the parties submitted the following stipulation of facts:
The parties agree on the following facts:
1. That the plaintiff, Angel Vargas, is of age and a resident of the municipality of Iloilo,
Iloilo, Philippine Islands.
2. That the defendant, Petronila Chua, is also of age, and is married to Coo Pao alias Coo
Paoco, and resides in Iloilo.
3. That the defendant, Coo Teng Hee, is also of age and a resident of Iloilo, and is the
sole owner of the business known as Coo Kun & Sons Hardware Co. established in Iloilo.
4. That the defendant, Cham Samco & Sons, is a commercial partnership duly organized
under the laws of the Philippine Islands, with their principal office in the City of Manila,
and that the defendants Cham Samco, Cham Siong E, Cham Ai Chia and Lee Cham Say,
all of age and residents of the City of Manila, are the partners of the firm Cham Samco &
Sons.
5. The parties take for granted that the complaint in this case is amended in the sense
that it includes Coo Paoco as party defendant in his capacity as husband of the
defendant, Petronila Chua, with Attorney Jose F. Orozco also representing him, and that
he renounces his rights to receive summons in this case by reproducing the answer of his
codefendant, Petronila Chua.
6. That the plaintiff is the registered owner and possessor of United States Patent No.
1,507,530 on certain plow improvements, issued by the United States Patent Office on
September 2, 1924, a certified copy of which was registered in the Bureau of Commerce
and industry of the Government of the Philippine Islands on October 17, 1924. A certified
copy of said patent is attached to this stipulation of facts as Exhibit A.
7. That the plaintiff is now and has been engaged, since the issuance of his patent, in the
manufacture and sale of plows of the kind, type and design covered by the
aforementioned patent, said plows being of different sizes and numbered in accordance
therewith from 1 to 5.
8. That, since the filing of the complaint to date, the defendant, Petronila Chua, has been
manufacturing and selling plows of the kind, type and design represented by Exhibits B,
B-1 and B-2, of different sizes, designated by Nos. 2, 4 and 5.
9. That, since the filing of the complaint to date, the defendant, Coo Teng Hee, doing
business in Iloilo under the name of Coo Kun & Sons Hardware Co., has been obtaining
his plows, of the form and size of Exhibits B, B-1 and B-2, from the defendant Petronila
Chua.
10. Without prejudice to the plaintiff's right to ask the defendants to render an accounting
in case the court deem it proper, the parties agree that the defendant Coo Teng Hee,
doing business under the name of Coo Kun & Sons Hardware Co., has been selling to his
customers in his store on J. Ma. Basa Street in Iloilo, plows of the kind, type and design
represented by Exhibits B, B-1 and B-2, having bought said plows from his codefendant,
Petronila Chua, who manufactures them in her factory on Iznart Street, Iloilo.
 11. That, according to the invoices marked Exhibits C and C-2 dated March 13, 1928, and
June 19, 1928, respectively, the defendant Cham Samco & Sons, on the dates
mentioned, had, in the ordinary course of business, bought of its codefendant Coo Kun &
Sons Hardware Co., 90 plows of the form, type and design of Exhibits B, B-1 and B-2
which it has been selling in its store on Sto. Cristo Street, Manila.
12. That the same defendant Cham Samco & Sons, in the ordinary course of business,
bought on March 17, 1928, of the store "El Progreso" owned by Yao Ki & Co., of Iloilo, a
lot of 50 plows, of the form, type and design of Exhibit B-1, as shown by Invoice C-1, and
that it has been selling them in its store on Sto. Cristo St., Manila.
13. That, on September 19, 1928, the defendant Cham Samco & Sons, sold in its store
on Sto. Cristo St., Manila, the plow Exhibit B-1, for the sale of which invoice Exhibit D was
issued.
14. That, on December 20, 1927, the plaintiff herein, through his attorneys Paredes,
Buencamino & Yulo, sent by registered mail to the herein defendant, Coo Kun & Sons
Hardware Co., at Iloilo, the original of the letter Exhibit E, which was received by it on
September 28, 1927, according to the receipt marked Exhibit E-1 attached hereto.
15. That the plows manufactured by the plaintiff in accordance with his patent, Exhibit A,
are commonly known to the trade in Iloilo, as well as in other parts of the Philippines, as
"Arados Vargas", and that the plaintiff is the sole manufacturer of said plows. A sample of
these plows is presented as Exhibit F.
16. That the document, Exhibit 1-Chua, is a certified copy of the amended complaint, the
decision of the Court of First Instance of Iloilo and that of the Supreme Court (R. G. No.
14101) in civil case No. 3044 of Iloilo, entitled "Angel Vargas", plaintiff, vs. F. M. Yaptico &
Co., Ltd., defendant", and that Exhibit 2-Chua et al. is a certified copy of Patent No.
1,020,232, to which the aforementioned complaint and decision refer, issued in favor of
Angel Vargas by the United States Patent Office on March 12, 1912, and that Exhibit 3-
Chua et al., represents the plow manufactured by Angel Vargas in accordance with his
Patent marked Exhibit 2-Chua et al.
The appellants assign the following errors:
FIRST ERROR
The trial court erred in declaring that the Vargas plow, Exhibit F (covered by Patent No.
1,507,530) is distinct from the old model Vargas plow, Exhibit 2-Chua, covered by the
former Patent No. 1,020,232, which had been declared null and void by this court.
SECOND ERROR
The trial court erred in mistaking the improvement on the plow for the plow itself.
THIRD ERROR
The trial court erred in rendering judgment in favor of the plaintiff and against the
defendants.
FOURTH ERROR
The trial court erred in not dismissing the complaint with costs against the plaintiff.
The evidence shows that Exhibit F is the kind of plows the plaintiff, Angel Vargas, manufactures,
for which Patent No. 1,507,530, Exhibit A, was issued in his favor. Exhibits B, B-1 and B-2 are
samples of the plows which the herein appellants, Coo Pao and Petronila Chua, have been
manufacturing since 1918, and Exhibit 3-Chua represents the plow for which, on March 12, 1912,
the appellee obtained a patent from the United States Patent Office, which was declared null and
void by the Supreme Court in the case of Vargas vs. F. M. Yap Tico & Co. (40 Phil., 195).
With these facts in view, the principal and perhaps the only question we are called upon to decide
is whether the plow, Exhibit F, constitutes a real invention or an improvement for which a patent
may be obtained, or if, on the contrary, it is substantially the same plow represented by Exhibit 3-
Chua the patent for which was declared null and void in the aforementioned case of Vargas vs. F.
M. Yaptico & Co., supra.
We have carefully examined all the plows presented as exhibits as well as the designs of those
covered by the patent, and we are convinced that no substantial difference exists between the
plow, Exhibit F, and the plow, Exhibit 3-Chua which was originally patented by the appellee,
Vargas. The only difference noted by us is the suppression of the bolt and the three holes on the
metal strap attached to the handle bar. These holes and bolt with its nut were suppressed in
Exhibit F in which the beam is movable as in the original plow. The members of this court, with the
plows in view, arrived at the conclusion that not only is there no fundamental difference between
the two plows but no improvement whatever has been made on the latest model, for the same
working and movement of the beam existed in the original model with the advantage, perhaps,
that its graduation could be carried through with more certainty by the use of the bolt which as has
already been stated, was adjustable and movable.
As to the fact, upon which much emphasis was laid, that deeper furrows can be made with the
new model, we have seen that the same results can be had with the old implement.
In view of the foregoing, we are firmly convinced that the appellee is not entitled to the protection
he seeks for the simple reason that his plow, Exhibit F, does not constitute an invention in the
legal sense, and because, according to the evidence, the same type of plows had been
manufactured in this country and had been in use in many parts of the Philippine Archipelago,
especially in the Province of Iloilo, long before he obtained his last patent.
In the above mentioned case of Vargas vs. F. M. Yaptico & Co., we said:
 When a patent is sought to be enforced, "the questions of invention, novelty, or prior use,
and each of them, are open to judicial examination." 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 the 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 then shifts to the defendant to
overcome by competent evidence this legal presumption. With all due respects, therefore,
for the critical and expert examination of the invention by the United States Patent Office,
the question of the validity of the patent is one for judicial determination, and since a
patent has been submitted, the exact question is whether the defendant has assumed the
burden of proof as to anyone of his defenses. (See Agawan Co. vs. Jordan [1869], 7
Wall., 583; Blanchard vs. Putnam [1869], 8 Wall., 420; Seymour vs. Osborne [1871], 11
Wall., 516; Reckendorfer vs. Faber [1876], 92 U. S., 347; 20 R. C. L., 1112, 1168, 1169.)

Although we spent some time in arriving at this point, yet, having reached it, the question
in the case is single and can be brought to a narrow compass. Under the English Statute
of Monopolies (21 Jac. Ch., 3), and under the United States Patent Act of February 21,
1793, later amended to be as herein quoted, it was always the rule, as stated by Lord
Coke, Justice Story and other authorities, that to entitle a man to a patent, the invention
must be new to the world. (Pennock and Sellers vs. Dialogue [1829], 2 Pet., 1.) As said
by the United States Supreme Court, "it has been repeatedly held by this court that a
single instance of public use of the invention by a patentee of more than two years before
the date of his application for his patent will be fatal to the validity of the patent when
issued." (Worley vs. Lower Tobacco Co. [1882], 104 U. S., 340; McClurg vs. Kingsland
[1843], 1 How., 202; Consolidated Fruit Jar Co. vs. Wright [1877], 94 U. S., 92;
Egbert vs. Lippmann [1881], 104 U. S., 333; Coffin vs. Ogden [1874], 18 Wall., 120;
Manning vs. Cape Ann Isinglass and Glue Co. [1883], 108 U. S., 462; Andrews vs. Hovey
[1887], 123 U. S., 267; Campbell vs. City of New York [1888], 1 L. R. A., 48.)

We repeat that in view of the evidence presented, and particularly of the examination we have
made of the plows, we cannot escape the conclusion that the plow upon which the appellee's
contention is based, does not constitute an invention and, consequently, the privilege invoked by
him is untenable and the patent acquired by him should be declared ineffective.

The judgment appealed from is hereby reversed and the appellants are absolved from the
complaint, with costs of this instance against the appellee. So ordered.

Avanceña, C.J., Street, Villamor, Ostrand, Villa-Real, Abad Santos, Hull, Vickers and Butte, JJ.,
concur.
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-38010 December 21, 1933
PATRICK HENRY FRANK and WILLIAM HENRY GOHN, plaintiffs-appellants,
vs.
G. KOSUYAMA, defendant-appellee.
J.W. Ferrier for appellants.
Pablo Lorenzo for appellee.
IMPERIAL, J.:
Patent No. 1519579 (Exhibit 117) on improvement in hemp stripping machines, issued by the
United States Patent Office on December 16,1924, and registered in the Bureau of Commerce
and Industry of the Philippine Islands on March 17,1925, was the origin of this action brought by
the plaintiffs herein who prayed that the judgment be rendered against the defendant, ordering him
thereby to refrain immediately from the manufacture and sale of machines similar to the one
covered by the patent: to render an accounting of the profits realized from the manufacture and
sale of the machines in question; that in case of refusal or failure to render such accounting, the
defendants be ordered to pay the plaintiffs the sum of P60 as profit on each machine
manufactured or sold by him; that upon approval of the required bond, said defendant be
restrained from continuing the manufacture and sale of the same kind of machines; that after the
trial the preliminary injunction issued therein be declared permanent and, lastly, that the said
defendant be sentenced to pay the costs and whatever damages the plaintiffs might be able to
prove therein. The action therefore was based upon alleged infringement by the defendant of the
rights and privileges acquired by the plaintiffs over the aforesaid patent through the manufacture
and sale by the former of machines similar to that covered by the aforesaid patent.
The plaintiffs appealed from the judgment rendered by the trial court dismissing their complaint,
with cost, as well as the defendant's counterclaim of P10,000. The defendant did not appeal.
In their amended complaint, the plaintiff alleged that their hemp stripping machines, for which they
obtained a patent, have the following characteristics: "A stripping head, a horizontal table, a
stripping knife supported upon such table, a tappering spindle, a rest holder adjustably secured on
the table portion, a lever and means of compelling the knife to close upon the table, a pallet or rest
in the bottom of the table, a resilient cushion under such palletor rest." In spite of the fact that they
filed an amended complaint from which the "spindle" or conical drum, which was the only
characteristic feature of the machine mentioned in the original complaint, was eliminated, the
plaintiffs insisted that the said part constitutes the essential difference between the machine in
question and other machines and that it was the principal consideration upon which their patent
was issued. The said plaintiffs sustained their contention on this point even in their printed brief
and memorandum filed in this appeal.
During the trial, both parties presented voluminous evidence from which the trial court arrived at
the following conclusions:
In constructing their machine the plaintiffs did nothing but improve, to a certain degree,
those that were already in vogue and in actual us in hemp producing provinces. It cannot
be said that they have invented the "spindle" inasmuch as this was already known since
the year 1909 or 1910. Neither it can be said that they have invented the stripping knife
and the contrivance which controls the movement and pressure thereof on the ground
that stripping knives together with their control sets were already in actual use in the
different stripping machines long before their machine appeared. Neither can it be said
that they invented the fly wheel because that part or piece thereof, so essential in every
machine from time immemorial, was already known and actually employed in hemp
stripping machines such as those of Riesgo (Exhibit 4-A), Crumb (Exhibit 1-A), Icsiar
(Exhibit A-Suzara), Browne (Exhibit 28-A), McFie, etc., all of which were in use for the
benefit of hemp long before the appearance of the plaintiffs' machines in the market.
Much less can it be said that they invented the pedal to raise the knife in order to allow
the hemp to be stripped to pass under it, on the ground that the use of such contrivance
has, likewise, been known since the invention of the most primitive of hemp stripping
machines.
On the other hand, although the plaintiffs alleged in their original complaint that "the
principal and important feature of said machine is a spindle upon which the hemp to be
stripped is wound in the process of stripping," nevertheless, in their amended complaint of
March 3, 1928, which was filed after a portion of the evidence therein had already been
submitted and it was known that the use of the spindle was nothing new, they still made
the allegations appearing in paragraph 3 of their said amended complaint and reproduced
on pages 2,3,4 and 5 hereof, copying the same from the application which they filed with
the United States Patent Office, under which they obtained their patent in question. The
aforesaid application clearly shows that what they applied for was not a patent for a
"pioneer or primary invention" but only for some "new and useful improvement in hemp
stripping machines."
We have carefully reviewed the evidence presented and have had the opportunity of ascertaining
the truth of the conclusions above stated. We agree with the trial court that, strictly speaking, the
hemp stripping machine of the plaintiffs does not constitute an invention on the ground that it lacks
the elements of novelty, originality and precedence (48 C.J., sec. 101, p. 97, and 102, p. 98). In
fact, before the plaintiffs herein obtained their patent, they themselves had already publicly used
the same kind of machine for some months, at least, and, various other machines, having in
general, the same characteristics and important parts as that of the said plaintiffs, were known in
the Province of Davao. Machines known as Molo, Riesgo, Crumb, Icsiar, Browne and McFie were
already known in that locality and used by the owners of hemp plantations before the machine of
the plaintiffs came into existence. It may also be noted that Adrian de Icsiar applied for a patent on
an invention which resulted in the rejection by the United States Patent Office of the plaintiffs'
original application for a patent on the so called "spindle" or conical drum which was then in actual
use in the Dringman and Icsiar hemp stripping machines.

Notwithstanding the foregoing facts, the trial court did not decree the annulment of the plaintiffs'
patent and the herein defendant-appellee insists that the patent in question should be declared
null and void. We are of the opinion that it would be improper and untimely to render a similar
judgment, in view of the nature of the action brought by the plaintiffs and in the absence of a
cross-complaint to that effect. For the purposes of this appeal, suffice it to hold that the defendant
is not civilly liable for alleged infringement of the patent in question.

In the light of sound logic, the plaintiffs cannot insist that the "spindle" was a patented invention on
the ground that said part of the machine was voluntarily omitted by them from their application, as
evidenced by the photographic copy thereof (Exhibit 41) wherein it likewise appears that the
patent on Improved Hemp Stripping Machines was issued minus the "spindle" in question. Were
we to stress to this part of the machine, we would be giving the patent obtained by the plaintiffs a
wider range than it actually has, which is contrary to the principles of interpretation in matters
relating to patents.

In support of their claim the plaintiffs invoke the doctrine laid down by this court in the case of
Frank and Gohn vs. Benito (51 Phil., 712), wherein it was held that the therein defendant really
infringed upon the patent of the therein plaintiffs. It may be noted that the plaintiffs in the former
and those of the latter case are the same and that the patent then involved is the very same one
upon which the present action of the plaintiffs is based. The above-cited case, however, cannot be
invoked as a precedent to justify a judgment in favor of the plaintiffs-appellants on the ground that
the facts in one case entirely different from those in the other. In the former case the defendant did
not set up the same special defenses as those alleged by the herein defendant in his answer and
the plaintiffs therein confined themselves to presenting the patent, or rather a copy thereof,
wherein the "spindle" was mentioned, and this court took for granted their claim that it was one of
the essential characteristics thereof which was imitated or copied by the then defendant. Thus it
came to pass that the "spindle" in question was insistently mentioned in the decision rendered on
appeal as the essential part of the plaintiffs' machine allegedly imitated by the then defendant. In
the case under consideration, it is obvious that the "spindle" is not an integral part of the machine
patented by the plaintiffs on the ground that it was eliminated from their patent inasmuch as it was
expressly excluded in their application, as evidenced by the aforesaid Exhibit 41.

Wherefore, reiterating that the defendant cannot be held civilly liable for alleged infringement of
the patent upon which the present action is based on the ground that there is no essential part of
the machine manufactured and sold by him, which was unknown to the public in the Province of
Davao at the time the plaintiffs applied for and obtained their patent for improved hemp stripping
machines, the judgment appealed from is hereby affirmed, with the costs against the plaintiffs-
appellants. So ordered.

Avanceña, C.J., Malcolm, Villa-Real, and Hull, JJ., concur.

 CHAPTER 2
AMENDMENTS TO REPUBLIC ACT NO. 8293, OTHERWISE KNOWN AS
THE INTELLECTUAL PROPERTY CODE OF THE PHILIPPINES
SEC. 5. Section 22 of Republic Act No. 8293, otherwise known as the Intellectual Property Code
of the Philippines, is hereby amended to read as follows:
"SEC. 22. Non-Patentable Inventions. - The following shall be excluded from patent
protection:
"22.1. Discoveries, scientific theories and mathematical methods, and in the case
of drugs and medicines, the mere discovery of a new form or new property of a
known substance which does not result in the enhancement of the known
efficacy of that substance, or the mere discovery of any new property or new use
for a known substance, or the mere use of a known process unless such known
process results in a new product that employs at least one new reactant.
"For the purpose of this clause, salts, esters, ethers, polymorphs, metabolites,
pure form, particle size, isomers, mixtures of isomers, complexes, combinations,
and other derivatives of a known substance shall be considered to be the same
substance, unless they differ significantly in properties with regard to efficacy;
"22.2. x x x;
"22.3. x x x;
"22.4. x x x;
"22.5. x x x; and
"22.6. x x x."
SEC. 6. Section 26 of Republic Act No. 8293, otherwise known as the Intellectual Property Code
of the Philippines, is hereby amended to read as follows:
"SEC. 26. Inventive Step. - 26.1. An invention involves an inventive step if, having regard
to prior art, it is not obvious to a person skilled in the art at the time of the filing date or
priority date of the application claiming the invention. (n)
"26.2. In the case of drugs and medicines, there is no inventive step if the invention
results from the mere discovery of a new form or new property of a known substance
which does not result in the enhancement of the known efficacy of that substance, or the
mere discovery of any new property or new use for a known substance, or the mere use
of a known process unless such known process results in a new product that employs at
least one new reactant."
SEC. 7. Section 72 of Republic Act No. 8293, otherwise known as the Intellectual Property Code
of the Philippines, is hereby amended to read as follows:
"SEC. 72. Limitations of Patent Rights. - The owner of a patent has no right to prevent
third parties from performing, without his authorization, the acts referred to in Section 71
hereof in the following circumstances:
"72.1. Using a patented product which has been put on the market in the
Philippines by the owner of the product, or with his express consent, insofar as
such use is performed after that product has been so put on the said market:
Provided, That, with regard to drugs and medicines, the limitation on patent rights
shall apply after a drug or medicine has been introduced in the Philippines or
anywhere else in the world by the patent owner, or by any party authorized to
use the invention: Provided, further, That the right to import the drugs and
medicines contemplated in this section shall be available to any government
agency or any private third party;
"72.2. Where the act is done privately and on a non-commercial scale or for a
non-commercial purpose: Provided, That it does not significantly prejudice the
economic interests of the owner of the patent;
"72.3. Where the act consists of making or using exclusively for experimental use
of the invention for scientific purposes or educational purposes and such other
activities directly related to such scientific or educational experimental use;
"72.4. In the case of drugs and medicines, where the act includes testing, using,
making or selling the invention including any data related thereto, solely for
purposes reasonably related to the development and submission of information
and issuance of approvals by government regulatory agencies required under
any law of the Philippines or of another country that regulates the manufacture,
construction, use or sale of any product: Provided, That, in order to protect the
data submitted by the original patent holder from unfair commercial use provided
in Article 39.3 of the Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS Agreement), the Intellectual Property Office, in
consultation with the appropriate government agencies, shall issue the
appropriate rules and regulations necessary therein not later than one hundred
twenty (120) days after the enactment of this law;
"72.5. Where the act consists of the preparation for individual cases, in a
pharmacy
or by a medical professional, of a medicine in accordance with a medical
 shall apply after a drug or medicine has been introduced in the Philippines or
anywhere else in the world by the patent owner, or by any party authorized to
use the invention: Provided, further, That the right to import the drugs and
medicines contemplated in this section shall be available to any government
agency or any private third party;
"72.2. Where the act is done privately and on a non-commercial scale or for a
non-commercial purpose: Provided, That it does not significantly prejudice the
economic interests of the owner of the patent;
"72.3. Where the act consists of making or using exclusively for experimental use
of the invention for scientific purposes or educational purposes and such other
activities directly related to such scientific or educational experimental use;
"72.4. In the case of drugs and medicines, where the act includes testing, using,
making or selling the invention including any data related thereto, solely for
purposes reasonably related to the development and submission of information
and issuance of approvals by government regulatory agencies required under
any law of the Philippines or of another country that regulates the manufacture,
construction, use or sale of any product: Provided, That, in order to protect the
data submitted by the original patent holder from unfair commercial use provided
in Article 39.3 of the Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS Agreement), the Intellectual Property Office, in
consultation with the appropriate government agencies, shall issue the
appropriate rules and regulations necessary therein not later than one hundred
twenty (120) days after the enactment of this law;
"72.5. Where the act consists of the preparation for individual cases, in a
pharmacy or by a medical professional, of a medicine in accordance with a
medical
"74.3. All cases arising from the implementation of this provision shall be
cognizable by courts with appropriate jurisdiction provided by law.
"No court, except the Supreme Court of the Philippines, shall issue any
temporary restraining order or preliminary injunction or such other provisional
remedies that will prevent its immediate execution.
"74.4. The Intellectual Property Office (IPO), in consultation with the appropriate
government agencies, shall issue the appropriate implementing rules and
regulations for the use or exploitation of patented inventions as contemplated in
this section within one hundred twenty (120) days after the effectivity of this law."
SEC. 10. Section 93 of Republic Act No. 8293, otherwise known as the Intellectual Property Code
of the Philippines, is hereby amended to read as follows:
"SEC. 93. Grounds for Compulsory Licensing. - The Director General of the Intellectual
Property Office may grant a license to exploit a patented invention, even without the
agreement of the patent owner, in favor of any person who has shown his capability to
exploit the invention, under any of the following circumstances:
"93.1. National emergency or other circumstances of extreme urgency;
"93.2. Where the public interest, in particular, national security, nutrition, health or the
development of other vital sectors of the national economy as determined by the
appropriate agency of the Government, so requires; or
"93.3. Where a judicial or administrative body has determined that the manner of
exploitation by the owner of the patent or his licensee is anti-competitive; or
"93.4. In case of public non-commercial use of the patent by the patentee, without
satisfactory reason;
"93.5. If the patented invention is not being worked in the Philippines on a commercial
scale, although capable of being worked, without satisfactory reason: Provided, That the
importation of the patented article shall constitute working or using the patent; (Secs. 34,
34-A, 34-B, R.A. No. 165a) and
"93.6. Where the demand for patented drugs and medicines is not being met to an
adequate extent and on reasonable terms, as determined by the Secretary of the
Department of Health."
SEC. 11. A new Section 93-A is hereby inserted after Section 93 of Republic Act No. 8293,
otherwise known as the Intellectual Property Code of the Philippines, to read as follows:
"SEC. 93-A. Procedures on Issuance of a Special Compulsory License under the TRIPS
Agreement. - 93-A.1. The Director General of the Intellectual Property Office, upon the
written recommendation of the Secretary of the Department of Health, shall, upon filing of
a petition, grant a special compulsory license for the importation of patented drugs and
medicines. The special compulsory license for the importation contemplated under this
provision shall be an additional special alternative procedure to ensure access to quality
affordable medicines and shall be primarily for domestic consumption: Provided, That
adequate remuneration shall be paid to the patent owner either by the exporting or
importing country. The compulsory license shall also contain a provision directing the
grantee the license to exercise reasonable measures to prevent the re-exportation of the
products imported under this provision.
"The grant of a special compulsory license under this provision shall be an exception to
Sections 100.4 and 100.6 of Republic Act No. 8293 and shall be immediately executory.
 "No court, except the Supreme Court of the Philippines, shall issue any temporary
restraining order or preliminary injunction or such other provisional remedies that will
prevent the grant of the special compulsory license.
"93-A.2. A compulsory license shall also be available for the manufacture and export of
drugs and medicines to any country having insufficient or no manufacturing capacity in
the pharmaceutical sector to address public health problems: Provided, That, a
compulsory license has been granted by such country or such country has, by notification
or otherwise, allowed importation into its jurisdiction of the patented drugs and medicines
from the Philippines in compliance with the TRIPS Agreement.
"93-A.3. The right to grant a special compulsory license under this section shall not limit
or prejudice the rights, obligations and flexibilities provided under the TRIPS Agreement
and under Philippine laws, particularly Section 72.1 and Section 74 of the Intellectual
Property Code, as amended under this Act. It is also without prejudice to the extent to
which drugs and medicines produced under a compulsory license can be exported as
allowed in the TRIPS Agreement and applicable laws."
SEC. 12. Section 94 of Republic Act No. 8293, otherwise known as the Intellectual Property Code
of the Philippines, is hereby amended to read as follows:
"(c) In cases of public non-commercial use; and
"(d) In cases where the demand for the patented drugs and medicines in the Philippines is
not being met to an adequate extent and on reasonable terms, as determined by the
Secretary of the Department of Health.
"95.3. In situations of national emergency or other circumstances of extreme urgency, the
right holder shall be notified as soon as reasonably practicable.
"95.4. In the case of public non-commercial use, where the government or contractor,
without making a patent search, knows or has demonstrable grounds to know that a valid
patent is or will be used by or for the government, the right holder shall be informed
promptly. (n)
"95.5. Where the demand for the patented drugs and medicines in the Philippines is not
being met to an adequate extent and on reasonable terms, as determined by the
Secretary of the Department of Health, the right holder shall be informed promptly."

"SEC. 94. Period for Filing a Petition for a Compulsory License. - 94.1. A compulsory
license may not be applied for on the ground stated in Subsection 93.5 before the
expiration of a period of four (4) years from the date of filing of the application or three (3)
years from the date of the patent whichever period expires last.

"94.2. A compulsory license which is applied for on any of the grounds stated in
Subsections 93.2, 93.3, 93.4, and 93.6 and Section 97 may be applied for at any time
after the grant of the patent. (Sec. 34(1), R. A. No. 165)"

SEC. 13. Section 95 of Republic Act No. 8293, otherwise known as the Intellectual Property Code
of the Philippines, is hereby amended to read as follows:

"SEC. 95. Requirement to Obtain a License on Reasonable Commercial Terms. - 95.1.

The license will only be granted after the petitioner has made efforts to obtain
authorization from the patent owner on reasonable commercial terms and conditions but
such efforts have not been successful within a reasonable period of time.

"95.2. The requirement under Subsection 95.1 shall not apply in any of the following
cases:

"(a) Where the petition for compulsory license seeks to remedy a practice determined
after judicial or administrative process to be anti-competitive;

"(b) In situations of national emergency or other circumstances of extreme urgency;

 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-32160 January 30, 1982
DOMICIANO A. AGUAS, petitioner,
vs.
CONRADO G. DE LEON and COURT OF APPEALS, respondents.
FERNANDEZ, J.:
This is a petition for certiorari to review the decision of the Court of Appeals in CA G.R. NO.
37824-R entitled "Conrado G. de Leon, plaintiff-appelle vs. Dominciano Aguas and F.H. Aquino
and Sons, defendants-appellants," the dispositive portion of which reads:
WHEREFORE, with the modification that plintiff-applee's award of moral
damages is hereby redured to P3,000.00, the appealed judgment is hereby
affirmed, in all othe respects, with costs against appellants. 1
On April 14, 1962, Conrado G. de Leon filed in the Court of First Instance of Rizal at Quezon City
a complaint for infringement of patent against Domiciano A. Aguas and F. H. Aquino and Sons
alleging that being the original first and sole inventor of certain new and useful improvements in
the process of making mosaic pre-cast tiles, he lawfully filed and prosecuted an application for
Philippine patent, and having complied in all respects with the statute and the rules of the
Philippine Patent Office, Patent No. 658 was lawfully granted and issued to him; that said
invention was new, useful, not known or used by others in this country before his invention
thereof, not patented or described in any printed publication anywhere before his invention
thereof, or more than one year prior to his application for patent thereof, not patented in any
foreign country by him or his legal representatives on application filed more than one year prior to
his application in this country; that plaintiff has the exclusive license to make, use and sell
throughout the Philippines the improvements set forth in said Patent No. 658; that the invention
patented by said Patent No. 658 is of great utility and of great value to plaintiff and of great benefit
to the public who has demanded and purchased tiles embodying the said invention in very large
quantities and in very rapidly increasing quant ies; that he has complied with the Philippine statues
relating to marking patented tiles sold by him; that the public has in general acknowledged the
validity of said Patent No. 658, and has respected plaintiff's right therein and thereunder; that the
defendant Domiciano A. Aguas infringed Letters of Patent No. 658 by making, using and selling
tiles embodying said patent invention and that defendant F. H. Aquino & Sons is guilty of
infringement by making and furnishing to the defendant Domiciano A. Aguas the engravings,
castings and devices designed and intended of tiles embodying plaintiff;s patented invention; that
he has given direct and personal notice to the defendants of their said acts of infringement and
requested them to desist, but nevertheless, defendants have refused and neglected to desist and
have disregarded such request, and continue to so infringe causing great and irreparable damage
to plaintiff; that if the aforesaid infringement is permitted to continue, further losses and damages
and irreparable injury will be sustained by the plaintiff; that there is an urgent need for the
immediate issuance of a preliminary injunction; that as a result of the defendants' wrongful
conduct, plaintiff has suffered and the defendants are liable to pay him, in addition to actual
damages and loss of profits which would be determined upon proper accounting, moral and
exemplary or corrective damages in the sum of P90,000.00; that plaintiff has been compelled to
go to court for the protection and enforcement of his and to engage the service of counsel, thereby
incurring attorney's fees and expenses of litigation in the sum of P5,000.00. 2
On April 14, 1962, an order granting the plaintiff's petition for a Writ of Preliminary Injunction was
issued. 3
On May 23, 1962, the defendant Domiciano A. Aguas filed his answer denying the allegations of
the plaintiff and alleging that: the plaintiff is neither the original first nor sole inventor of the
improvements in the process of making mosaic pre-cast tiles, the same having been used by
several tile-making factories in the Philippines and abroad years before the alleged invention by
de Leon; that Letters Patent No. 658 was unlawfully acquired by making it appear in the
application in relation thereto that the process is new and that the plaintiff is the owner of the
process when in truth and in fact the process incorporated in the patent application has been
known and used in the Philippines by almost all tile makers long before the alleged use and
registration of patent by plaintiff Conrado G. de Leon; that the registration of the alleged invention
did not confer any right on the plaintiff because the registration was unlawfully secured and was a
result of the gross misrepresentation on the part of the plaintiff that his alleged invention is a new
and inventive process; that the allegation of the plaintiff that Patent No. 658 is of great value to
plaintiff and of great benefit to the public is a mere conclusion of the plaintiff, the truth being that a)
the invention of plaintiff is neither inventive nor new, hence, it is not patentable, b) defendant has
been granted valid patents (Patents No. 108, 109, 110 issued on December 21, 1961) on designs
for concrete decorative wall tiles; and c) that he can not be guilty of infringement because his
products are different from those of the plaintiff. 4
The trial court rendered a decision dated December 29, 1965, the dispositive portion of which
reads:
WHEREFORE, judgment is hereby rendered in favor of plaintiff and against the
defendants:
1. Declaring plaintiff's patent valid and infringed:
2. Granting a perpetual injunction restraining defendants, their officers, agents,
employees, associates, confederates, and any and all persons acting under their
authority from making and/or using and/or vending tiles embodying said patented
invention or adapted to be used in combination embodying the same, and from
making, manufacturing, using or selling, engravings, castings and devises
designed and intended for use in apparatus for the making of tiles embodying
plaintiff's patented invention, and from offering or advertising so to do, and from
aiding and abetting or in any way contributing to the infringement of said patent;
 3. Ordering that each and all of the infringing tiles, engravings, castings and THE TRIAL COURT ERRED IN HOLDING THAT DEFENDANT DOMICIANO A.
devices, which are in the possession or under the control of defendants be AGUAS IS GUILTY OF INFRINGEMENT DESPITE THE FACT THAT
delivered to plaintiff; PLAINTIFF'S PATENT IS NOT A VALID ONE.

4. Ordering the defendants to jointly and severally pay to the plaintiff the following V
sums of money, to wit:
THE TRIAL COURT ERRED IN NOT HOLDING THAT THE DEFENDANT
(a) P10,020.99 by way of actual damages; COULD NEVER BE GUILTY OF INFRINGEMENT OF PLAINTIFF'S PATENT
BECAUSE EVEN IN MATTERS NOT PATENTED BY THE PLAINTIFF - LIKE
(b) P50,000.00 by way of moral damages; THE COMPOSITION AND PROPORTION OF INGREDIENTS USED AND THE
STRUCTURAL DESIGNS OF THE MOULD AND THE TILE PRODUCED - THAT
OF THE DEFENDANT ARE DIFFERENT.
(c) P5,000.00 by way of exemplary damages;
VI
(d) P5,000.00 by way of attorney's fees and
THE TRIAL COURT ERRED IN NOT DISMISSING THE COMPLAINT AND IN
(e) costs of suit. 5 HOLDING THE DEFENDANT, INSTEAD OF THE PLAINTIFF, LIABLE FOR
DAMAGES, AND ATTORNEY'S FEES.
The defendant Domiciano Aguas appealed to the Court of Appeals, assigning the following
errors. 6
On August 5, 1969, the Court of Appeals affirmed the decision of the trial court, with the
modification that plaintiff-appellee's award of moral damages was reduced to P3,000.00. 7
I
The petitioner assigns the following errors supposedly committed by the Court of Appeals:
THE TRIAL COURT ERRED IN NOT HOLDING THAT PLAINTIFF'S PATENT
FOR THE 'PROCESS OF MAKING MOSAIC PRE-CAST TILE' IS INVALID
It is now respectfully submitted that the Court of Appeals committed the following
BECAUSE SAID ALLEGED PROCESS IS NOT AN INVENTION OR
errors involving questions of law, to wit:
DISCOVERY AS THE SAME HAS ALREADY LONG BEEN USED BY TILE
MANUFACTURERS BOTH ABROAD AND IN THIS COUNTRY.
First error. — When it did not conclude that the letters patent of the respondent
although entitled on the cover page as a patent for improvements, was in truth
II
and in fact, on the basis of the body of the same, a patent for the old and non-
patentable process of making mosaic pre-cast tiles;
THE TRIAL COURT ERRED IN HOLDING THAT THE PATENT OF PLAINTIFF
IS VALID BECAUSE IT IS AN IMPROVEMENT OR THE AGE-OLD TILE Second error. — When it did not conclude from the admitted facts of the case,
MAKING SYSTEM. particularly the contents of the letters patent, Exh. L and the pieces of physical
evidence introduced consisting of samples of the tiles and catalouges, that the
III alleged improvements introduced by the respondent in the manufacture of
mosaic pre-cast tiles are not patentable, the same being not new, useful and
THE TRIAL COURT ERRED IN NOT ORDERING THE CANCELLATION OF inventive.
PLAINTIFF-APPELLEE'S LETTERS PATENT NO. 658, EXHIBIT L, IN
ACCORDANCE WITH THE PERTINENT PROVISIONS OF THE PATENT LAW, Third error. — As a corollary, when it sentenced the herein petitioner to pay the
REPUBLIC ACT 165. damages enumerated in the decision of the lower court (Record on Appeal, pp.
74-75), as confirmed by it (the Court of Appeals), but with the modification that
IV the amount of P50,000.00 moral damages was reduced to P3,000.00. 8

The facts, as found by the Court of Appeals, are:

 The basic facts borne out by the record are to the effect that on December 1,
1959 plaintiff-appellee filed a patent application with the Philippine Patent Office,
and on May 5, 1960, said office issued in his favor Letters Patent No. 658 for a
"new and useful improvement in the process of making mosaic pre-cast tiles"
(Exh, "L"); that defendant F.H. Aquino & Sons engraved the moulds embodying
plaintiff's patented improvement for the manufacture of pre-cast tiles, plaintiff
furnishing said defendant the actual model of the tiles in escayola and explained
to said engraver the plans, specifications and the details of the engravings as he
wanted them to be made, including an explanation of the lip width, artistic slope
of easement and critical depth of the engraving that plaintiff wanted for his
moulds; that engraver Enrique Aquino knew that the moulds he was engraving
for plaintiff were the latter's very own, which possession the new features and
characteristics covered by plaintiff's parent; that defendant Aguas personally, as
a building contractor, purchased from plaintiff, tiles shaped out of these moulds at
the back of which was imprinted plaintiff's patent number (Exhs., "A" to "E"); that
subsequently, through a representative, Mr. Leonardo, defendant Aguas
requested Aquino to make engravings of the same type and bearing the
characteristics of plaintiff's moulds; that Mr. Aquino knew that the moulds he was
asked to engrave for defendant Aguas would be used to produce cement tiles
similar to plaintiff's; that the moulds which F.H. Aquino & Sons eventually
engraved for Aguas and for which it charged Aguas double the rate it charged
plaintiff De Leon, contain the very same characteristic features of plaintiff's mould
and that Aguas used these moulds in the manufacture of his tiles which he
actually put out for sale to the public (Exhs. "1" to "3" and Exhs. "A" to "E"); that
both plaintiff's and defendant Aguas' tiles are sculptured pre-cast wall tiles
intended as a new feature of construction and wag ornamentation substantially
Identical to each other in size, easement, lip width and critical depth of the
deepest depression; and that the only significant difference between plaintiff's
mould and that engraved by Aquino for Aguas is that, whereas plaintiff's mould
turns out tiles 4 x 4 inches in size, defendant Aguas' mould is made to fit a 4-1/4
x 4-1/4 inch tile. 9
The patent right of the private respondent expired on May 5, 1977. 10
The errors will be discuss
only to determine the right of said private respondent to damages.
The petitioner questioned the validity of the patent of the private respondent, Conrado G. de Leon,
on the ground that the process, subject of said patent, is not an invention or discovery, or an
improvement of the old system of making tiles. It should be noted that the private respondent does
not claim to be the discoverer or inventor of the old process of tile-making. He only claims to have
introduced an improvement of said process. In fact, Letters Patent No. 658 was issued by the
Philippine Patent Office to the private respondent, Conrado G. de Leon, to protect his rights as the
inventor of "an alleged new and useful improvement in the process of making mosaic pre-cast
tiles." 11 Indeed, Section 7, Republic Act No. 165, as amended provides: "Any invention of a new
and useful machine, manufactured product or substance, process, or an improvement of the
foregoing, shall be patentable.
The Court of Appeals found that the private respondent has introduced an improvement in the
process of tile-making because:
... we find that plaintiff-appellee has introduced an improvement in the process of
tile-making, which proceeds not merely from mechanical skill, said improvement
consisting among other things, in the new critical depth, lip width, easement and
field of designs of the new tiles. The improved lip width of appellee's tiles ensures
the durability of the finished product preventing the flaking off of the edges. The
easement caused by the inclination of the protrusions of the patented moulds is
for the purpose of facilitating the removal of the newly processed tile from the
female die. Evidently, appellee's improvement consists in the solution to the old
critical problem by making the protrusions on his moulds attain an optimum
height, so that the engraving thereon would be deep enough to produce tiles for
sculptured and decorative purposes, strong optimum thickness of appellee's new
tiles of only 1/8 of an inch at the deepest easement (Exhs. "D" and "D-1") is a
most critical feature, suggestive of discovery and inventiveness, especially
considering that, despite said thinness, the freshly formed tile remains strong
enough for its intended purpose.
While it is true that the matter of easement, lip width, depth, protrusions and
depressions are known to some sculptors, still, to be able to produce a new and
useful wall tile, by using them all together, amounts to an invention. More so, if
the totality of all these features are viewed in combination with the Ideal
composition of cement, sodium silicate and screened fine sand.
By using his improved process, plaintiff has succeeded in producing a new
product - a concrete sculptured tile which could be utilized for walling and
decorative purposes. No proof was adduced to show that any tile of the same
kind had been produced by others before appellee. Moreover, it appears that
appellee has been deriving considerable profit from his manufacture and sale of
such tiles. This commercial success is evidence of patentability (Walker on
Patents, Dellers Edition, Vol. I, p. 237). 12
The validily of the patent issued by the Philippines Patent Office in favor of the private respondent
and the question over the inventiveness, novelty and usefulness of the improved process therein
specified and described are matters which are better determined by the Philippines Patent Office.
The technical staff of 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 respondent's new tiles as a
discovery. There is a presumption that the Philippines Patent Office has correctly determined the
patentability of the improvement by the private respondent of the process in question.
Anent this matter, the Court of Appeals said:
Appellant has not adduced evidence sufficient to overcome the above
established legal presumption of validity or to warrant reversal of the findings of
the lower court relative to the validity of the patent in question. In fact, as we
have already pointed out, the clear preponderance of evidence bolsters said
presumption of validity of appellee's patent. There is no indication in the records
of this case and this Court is unaware of any fact, which would tend to show that
concrete wall tiles similar to those produced by appellee had ever been made by
others before he started manufacturing the same. In fact, during the trial,
 appellant was challenged by appellee to present a tile of the same kind as those
produced by the latter, from any earlier source but, despite the fact that appellant
had every chance to do so, he could not present any. There is, therefore, no
concrete proof that the improved process of tile-making described in appellee's
patent was used by, or known to, others previous to his discovery thereof. 13
The contention of the petitioner Aguas that the letters patent of de Leon was actually a patent for
the old and non-patentable process of making mosaic pre-cast tiles is devoid of merit. De Leon
never claimed to have invented the process of tile-making. The Claims and Specifications of
Patent No. 658 show that although some of the steps or parts of the old process of tile making
were described therein, there were novel and inventive features mentioned in the process. Some
of the novel features of the private respondent's improvements are the following: critical depth,
with corresponding easement and lip width to such degree as leaves the tile as thin as 1/8 of an
inch at its thinnest portion, Ideal composition of cement and fine river sand, among other
ingredients that makes possible the production of tough and durable wall tiles, though thin and
light; the engraving of deep designs in such a way as to make the tiles decorative, artistic and
suitable for wall ornamentation, and the fact that the tiles can be mass produced in commercial
quantities and can be conveniently stock-piled, handled and packed without any intolerable
incidence of breakages. 14
The petitioner also contends that the improvement of respondent is not patentable because it is
not new, useful and inventive. This contention is without merit.
The records disclose that de Leon's process is an improvement of the old process of tile making.
The tiles produced from de Leon's process are suitable for construction and ornamentation, which
previously had not been achieved by tiles made out of the old process of tile making. De Leon's
invention has therefore brought about a new and useful kind of tile. The old type of tiles were
usually intended for floors although there is nothing to prevent one from using them for walling
purposes. These tiles are neither artistic nor ornamental. They are heavy and massive.
The respondent's improvement is indeed inventive and goes beyond the exercise of mechanical
skill. He has introduced a new kind of tile for a new purpose. He has improved the old method of
making tiles and pre-cast articles which were not satisfactory because of an intolerable number of
breakages, especially if deep engravings are made on the tile. He has overcome the problem of
producing decorative tiles with deep engraving, but with sufficient durability. 15 Durability inspite of
the thinness and lightness of the tile, is assured, provided that a certain critical depth is maintained
in relation to the dimensions of the tile. 16
The petitioner also claims that changing the design from embossed to engraved tiles is neither
new nor inventive because the Machuca Tile Factory and the Pomona Tile Manufacturing
Company have been manufacturing decorative wall tiles that are embossed as well as
engraved; 17 that these tiles have also depth, lip width, easement and field of designs; 18 and that
the private respondent had copied some designs of Pomona. 19
The Machuca tiles are different from that of the private respondent. The designs are embossed
and not engraved as claimed by the petitioner. There may be depressions but these depressions
are too shallow to be considered engraved. Besides, the Machuca tiles are heavy and massive.
There is no similarity between the Pomona Tiles and de Leon's tiles. The Pomona tiles are made
of ceramics. 20 The process involved in making cement tiles is different from ceramic tiles. Cement
tiles are made with the use of water, while in ceramics fire is used. As regards the allegation of the
petitioner that the private respondent copied some designs of Pomona, suffice it to say that what
is in issue here is the process involved in tile making and not the design.
In view of the foregoing, this Court finds that Patent No. 658 was legally issued, the process
and/or improvement being patentable.
Both the trial court and the Court of Appeals found as a fact that the petitioner Domiciano A.
Aguas did infringe de Leon's patent. There is no showing that this case falls under one of the
exceptions when this Court may overrule the findings of fact of the Court of Appeals. The only
issue then to be resolved is the amount of damages that should be paid by Aguas.
In its decision the Court of Appeals affirmed the amount of damages awarded by the lower court
with the modification that the respondent is only entitled to P3,000.00 moral damages. 21
The lower court awarded the following damages: 22
a) P10,020.99 by way of actual damages;
b) P50,000.00 by way of moral damages;
c) P5,000.00 by way of exemplary damages;
d) P5,000.00 by way of attomey's fees and
e) Costs of suit
because:
An examination of the books of defendant Aguas made before a Commissioner
reveals that during the period that Aguas was manufacturing and selling tiles
similar to plaintiff's, he made a gross income of P3,340.33, which can be safely
be considered the amount by which he enriched himself when he infringed
plaintiff's patent. Under Sec. 42 of the Patent Law any patentee whose rights
have been infringed is entitled to damages which, according to the circumstances
of the case may be in a sum above the amount found as actual damages
sustained provided the award does not exceed three times the amount of such
actual damages. Considering the wantonness of the infringement committed by
the defendants who knew all the time about the existence of plaintiff's patent, the
Court feels there is reason to grant plaintiff maximum damages in the sum of
P10,020.99. And in order to discourage patent infringements and to give more
teeth to the provisions of the patent law thus promoting a stronger public policy
committed to afford greater incentives and protection to inventors, the Court
hereby awards plaintiff exemplary damages in the sum of P5,000.00 to be paid
 jointly and severally by defendants. Considering the status of plaintiff as a
reputable businessman, and owner of the likewise reputed House of Pre-Cast, he
is entitled to an award of moral damages in the sum of P50,000.00. 23

In reducing the amount of moral damages the Court of Appeals said:

As regards the question of moral damages it has been shown that as a result of
the unlawful acts of infringment committed by defendants, plaintiff was
unstandably very sad; he worried and became nervous and lost concentration on
his work in connection with his tile business (pp. 28, 30, t.s.n., Feb. 28, 1964). In
addition, plaintiff's character and reputation have been unnecessarily put in
question because defendants, by their acts of infringement have created a doubt
or suspicion in the public mind concerning the truth and honesty of plaintiff's
advertisements and public announcements of his valid patent. Necessarily, said
acts of defendants have caused plaintiff considerable mental suffering,
considering especially, the fact that he staked everything on his pre-cast tile
business (p. 36, t.s.n., Id.) The wantonness and evident bad faith characterizing
defendants' prejudicial acts against plaintiff justify the assessment of moral
damages in plaintiff's favor, though we do not believe the amount of P50,000.00
awarded by the lower court is warranted by the circumstances. We feel that said
amount should be reduced to P3,000.00 by way of compensating appellee for his
moral suffering. "Willful injury to property may be a legal ground for awarding
moral damages if the court should find that, under the circumstances such
damages are justly due" (Art. 2219 NCC).

There is no reason to reduce the amount of damages and attorneys fees awarded by the trial
court as modified by the Court of Appeals.

WHEREFORE, the decision of the Court of Appeals in CA G.R. No. 37824-R appealed from is
hereby affirmed, without pronouncement as to costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 113388 September 5, 1997
ANGELITA MANZANO, petitioner,
vs.
COURT OF APPEALS, and MELECIA MADOLARIA, as Assignor to NEW UNITED FOUNDRY
MANUFACTURING CORPORATION, respondents.
BELLOSILLO, J.:
The primary purpose of the patent system is not the reward of the individual but the advancement
of the arts and sciences. The function of a patent is to add to the sum of useful knowledge and
one of the purposes of the patent system is to encourage dissemination of information concerning
discoveries and inventions. This is a matter which is properly within the competence of the Patent
Office the official action of which has the presumption of correctness and may not be interfered
with in the absence of new evidence carrying thorough conviction that the Office has erred. Since
the Patent Office is an expert body preeminently qualified to determine questions of patentability,
its findings must be accepted if they are consistent with the evidence, with doubts as to
patentability resolved in favor of the Patent Office.1
Petitioner Angelita Manzano filed with the Philippine Patent Office on 19 February 1982 an action
for the cancellation of Letters Patent No. UM-4609 for a gas burner registered in the name of
respondent Melecia Madolaria who subsequently assigned the letters patent to New United
Foundry and Manufacturing Corporation (UNITED FOUNDRY, for brevity). Petitioner alleged that
(a) the utility model covered by the letters patent, in this case, an LPG gas burner, was not
inventive, new or useful; (b) the specification of the letters patent did not comply with the
requirements of Sec. 14, RA No. 165, as amended; (c) respondent Melecia Madolaria was not the
original, true and actual inventor nor did she derive her rights from the original, true and actual
inventor of the utility model covered by the letters patent; and, (d) the letters patent was secured
by means of fraud or misrepresentation. In support of her petition for cancellation petitioner further
alleged that (a) the utility model covered by the letters patent of respondent had been known or
used by others in the Philippines for more than one (1) year before she filed her application for
letters patent on 9 December 1979; (b) the products which were produced in accordance with the
utility model covered by the letters patent had been in public use or on sale in the Philippines for
more than one (1) year before the application for patent therefor was filed.
Petitioner presented the following documents which she correspondingly marked as exhibits: (a)
affidavit of petitioner alleging the existence of prior art, marked Exh. "A;" (b) a brochure distributed
by Manila Gas Corporation disclosing a pictorial representation of Ransome Burner made by
Ransome Torch and Burner Company, USA, marked Exh. "D;" and, (c) a brochure distributed by
Esso Gasul or Esso Standard Eastern, Inc., of the Philippines showing a picture of another similar
burner with top elevation view and another perspective view of the same burner, marked Exh. "E."
Testifying for herself petitioner narrated that her husband Ong Bun Tua worked as a helper in the
UNITED FOUNDRY where respondent Melecia Madolaria used to be affiliated with from 1965 to
1970; that Ong helped in the casting of an LPG burner which was the same utility model of a
burner for which Letters Patent No. UM-4609 was issued, and that after her husband's separation
from the shop she organized Besco Metal Manufacturing (BESCO METAL, for brevity) for the
casting of LPG burners one of which had the configuration, form and component parts similar to
those being manufactured by UNITED FOUNDRY. Petitioner presented in evidence an alleged
model of an LPG burner marked Exh. "K" and covered by the Letters Patent of respondent, and
testified that it was given to her in January 1982 by one of her customers who allegedly acquired it
from UNITED FOUNDRY. Petitioner also presented in evidence her own model of an LPG burner
called "Ransome" burner marked Exh. "L," which was allegedly manufactured in 1974 or 1975 and
sold by her in the course of her business operation in the name of BESCO METAL. Petitioner
claimed that this "Ransome" burner (Exh. "L") had the same configuration and mechanism as that
of the model which was patented in favor of private respondent Melecia Madolaria. Also presented
by petitioner was a burner cup of an imported "Ransome" burner marked Exh "M" which was
allegedly existing even before the patent application of private respondent.
Petitioner presented two (2) other witnesses, namely, her husband Ong Bun Tua and Fidel
Francisco. Ong testified that he worked as a helper in the UNITED FOUNDRY from 1965 to 1970
where he helped in the casting of LPG burners with the same form, configuration and mechanism
as that of the model covered by the Letters Patent issued to private respondent. Francisco
testified that he had been employed with the Manila Gas Corporation from 1930 to 1941 and from
1952 up to 1969 where he retired as supervisor and that Manila Gas Corporation imported
"Ransome" burners way back in 1965 which were advertised through brochures to promote their
sale.
Private respondent, on the other hand, presented only one witness, Rolando Madolaria, who
testified, among others, that he was the General Supervisor of the UNITED FOUNDRY in the
foundry, machine and buffing section; that in his early years with the company, UNITED
FOUNDRY was engaged in the manufacture of different kinds of gas stoves as well as burners
based on sketches and specifications furnished by customers; that the company manufactured
early models of single-piece types of burners where the mouth and throat were not detachable;
that in the latter part of 1978 respondent Melecia Madolaria confided in him that complaints were
being brought to her attention concerning the early models being manufactured; that he was then
instructed by private respondent to cast several experimental models based on revised sketches
and specifications; that private respondent again made some innovations; that after a few months,
private respondent discovered the solution to all the defects of the earlier models and, based on
her latest sketches and specifications, he was able to cast several models incorporating the
additions to the innovations introduced in the models. Various tests were conducted on the latest
model in the presence and under the supervision of Melecia Madolaria and they obtained perfect
results. Rolando Madolaria testified that private respondent decided to file her application for utility
model patent in December 1979.
On 7 July 1986 the Director of Patents Cesar C. Sandiego issued Decision No. 86-56 denying the
petition for cancellation and holding that the evidence of petitioner was not able to establish
convincingly that the patented utility model of private respondent was anticipated. Not one of the
various pictorial representations of business clearly and convincingly showed that the devices
presented by petitioner was identical or substantially identical with the utility model of the
respondent. The decision also stated that even assuming that the brochures depicted clearly each
and every element of the patented gas burner device so that the prior art and patented device
became identical although in truth they were not, they could not serve as anticipatory bars for the
reason that they were undated. The dates when they were distributed to the public were not
indicated and, therefore, were useless prior art references. The records and evidence also do not
support the petitioner's contention that Letters Patent No. UM-4609 was obtained by means of
fraud and/or misrepresentation. No evidence whatsoever was presented by petitioner to show that
the then applicant Melecia Madolaria withheld with intent to deceive material facts which, if
disclosed, would have resulted in the refusal by the Philippine Patent Office to issue the Letters
Patent under inquiry.
Petitioner elevated the decision of the Director of Patents to the Court of Appeals which on 15
October 1993 affirmed the decision of the Director of Patents. Hence, this petition for review
on certiorari alleging that the Court of Appeals erred (a) in relying on imaginary differences which
in actuality did not exist between the model of private respondent covered by Letters Patent No.
UM-4609 and the previously known model of Esso Standard Eastern, Inc., and Manila Gas
Corporation, making such imaginary differences grounded entirely on speculation, surmises and
conjectures; (b) in rendering judgment based on misapprehension of facts; (c) in relying mainly on
the testimony of private respondent's sole witness Rolando Madolaria; and, (d) in not cancelling
Letters Patent No. UM-4609 in the name of private respondent.
Petitioner submits that the differences cited by the Court of Appeals between the utility model of
private respondent and the models of Manila Gas Corporation and Esso Standard Eastern, Inc.,
are more imaginary than real. She alleges that based on Exhs. "E," "E-1," "F" and "F-1" or the
brochures of Manila Gas Corporation and Esso Standard Eastern, Inc., presented by petitioner,
the cup-shaped burner mouth and threaded hole on the side are shown to be similar to the utility
model of private respondent. The exhibits also show a detachable burner mouth having a plurality
of upwardly existing undulations adopted to act as gas passage when the cover is attached to the
top of said cup-shaped mouth all of which are the same as those in the patented model. Petitioner
also denies as substantial difference the short cylindrical tube of the burner mouth appearing in
the brochures of the burners being sold by Manila Gas Corporation and the long cylindered tube of
private respondent's model of the gas burner.
Petitioner argues that the actual demonstration made during the hearing disclosed the similarities
in form, operation and mechanism and parts between the utility model of private respondent and
those depicted in the brochures. The findings of the Patent Office and the Court of Appeals that
the brochures of Manila Gas Corporation and Esso Standard Eastern, Inc., are undated cannot
overcome the fact of their circulation before private respondent filed her application for utility
model patent. Petitioner thus asks this Court to take judicial notice of the fact that Esso Standard
Eastern, Inc., disappeared before 1979 and reappeared only during the Martial Law years as
Petrophil Corporation. Petitioner also emphasizes that the brochures indicated the telephone
number of Manila Gas Corporation as 5-79-81 which is a five (5) numbered telephone number
existing before 1975 because telephones in Metro Manila started to have six (6) numbers only
after that year.
Petitioner further contends that the utility model of private respondent is absolutely similar to the
LPG burner being sold by petitioner in 1975 and 1976, and also to the "Ransome" burner depicted
in the old brochures of Manila Gas Corporation and Esso Standard Eastern, Inc., fabricated by
Ransome Torch and Burner Company of Oakland, California, USA, especially when considered
through actual physical examination, assembly and disassembly of the models of petitioner and
private respondent. Petitioner faults the Court of Appeals for disregarding the testimonies of Ong
Bun Tua and Fidel Francisco for their failure to produce documents on the alleged importation by
Manila Gas Corporation of "Ransome" burners in 1965 which had the same configuration, form
and mechanism as that of the private respondent's patented model.
Finally, it is argued that the testimony of private respondent's lone witness Rolando Madolaria
should not have been given weight by the Patent Office and the Court of Appeals because it
contained mere after-thoughts and pretensions.
We cannot sustain petitioner. Section 7 of RA No. 165, as amended, which is the law on patents,
expressly provides —
Sec. 7. Inventians patentable. Any invention of a new and useful machine, manufactured
product or substance, process or an improvement of any of the foregoing, shall be
patentable.
Further, Sec. 55 of the same law provides —
Sec. 55. Design patents and patents for utility models. — (a) Any new, original and
ornamental design for an article of manufacture and (b) any new model of implements or
tools or of any industrial product or of part of the same, which does not possess the
quality of invention, but which is of practical utility by reason of its form, configuration,
construction or composition, may be protected by the author thereof, the former by a
patent for a design and the latter by a patent for a utility model, in the same manner and
subject to the same provisions and requirements as relate to patents for inventions
insofar as they are applicable except as otherwise herein provided.
The element of novelty is an essential requisite of the patentability of an invention or discovery. If
a device or process has been known or used by others prior to its invention or discovery by the
applicant, an application for a patent therefor should be denied; and if the application has been
granted, the court, in a judicial proceeding in which the validity of the patent is drawn in question,
will hold it void and ineffective.2 It has been repeatedly held that an invention must possess the
essential elements of novelty, originality and precedence, and for the patentee to be entitled to the
protection the invention must be new to the world.3
In issuing Letters Patent No. UM-4609 to Melecia Madolaria for an "LPG Burner" on 22 July 1981,
the Philippine Patent Office found her invention novel and patentable. The issuance of such patent
creates a presumption which yields only to clear and cogent evidence that the patentee was the
original and first inventor. The burden of proving want of novelty is on him who avers it and the
burden is a heavy one which is met only by clear and satisfactory proof which overcomes every
reasonable doubt.4 Hence, a utility model shall not be considered "new" if before the application
for a patent it has been publicly known or publicly used in this country or has been described in a
printed publication or publications circulated within the country, or if it is substantially similar to any
other utility model so known, used or described within the country.5
As found by the Director of Patents, the standard of evidence sufficient to overcome the
presumption of legality of the issuance of UM-4609 to respondent Madolaria was not legally met
by petitioner in her action for the cancellation of the patent. Thus the Director of Patents explained
his reasons for the denial of the petition to cancel private respondent's patent —
Scrutiny of Exhs. "D" and "E" readily reveals that the utility model (LPG Burner) is not
anticipated. Not one of the various pictorial representations of burners clearly and
convincingly show that the device presented therein is identical or substantially identical
in construction with the aforesaid utility model. It is relevant and material to state that in
determining whether novelty or newness is negatived by any prior art, only one item of the
prior art may be used at a time. For anticipation to occur, the prior art must show that
each element is found either expressly or described or under principles of inherency in a
single prior art reference or that the claimed invention was probably known in a single
prior art device or practice. (Kalman v. Kimberly Clark, 218 USPQ 781, 789)
Even assuming gratia arguendi that the aforesaid brochures do depict clearly on all fours
each and every element of the patented gas burner device so that the prior art and the
said patented device become identical, although in truth they are not, they cannot serve
as anticipatory bars for the reason that they are undated. The dates when they were
distributed to the public were not indicated and, therefore, they are useless prior art
references.
xxx xxx xxx
Furthermore, and more significantly, the model marked Exh. "K" does not show whether
or not it was manufactured and/or cast before the application for the issuance of patent
for the LPG burner was filed by Melecia Madolaria.
With respect to Exh. "L," petitioner claimed it to be her own model of LPG burner allegedly
manufactured sometime in 1974 or 1975 and sold by her in the course of her business
operation in the name of Besco Metal Manufacturing, which burner was denominated as
"Ransome" burner
xxx xxx xxx
But a careful examination of Exh. "L" would show that it does not bear the word
"Ransome" which is the burner referred to as the product being sold by the Petitioner.
This is not the way to prove that Exh. "L" anticipates Letters Patent No. UM-4609 through
Exhs. "C" and "D." Another factor working against the Petitioner's claims is that an
examination of Exh. "L" would disclose that there is no indication of the time or date it was
manufactured. This Office, thus has no way of determining whether Exh. "L" was really
manufactured before the filing of the aforesaid application which matured into Letters
Patent No. UM-4609, subject matter of the cancellation proceeding.
At this juncture, it is worthwhile to point out that petitioner also presented Exh. "M" which
is the alleged burner cup of an imported "Ransome" burner. Again, this Office finds the
same as unreliable evidence to show anticipation. It observed that there is no date
indicated therein as to when it was manufactured and/or imported before the filing of the
application for issuance of patent of the subject utility model. What is more, some
component parts of Exh. "M" are missing, as only the cup was presented so that the same
could not be compared to the utility model (subject matter of this case) which consists of
several other detachable parts in combination to form the complete LPG burner.
xxx xxx xxx
It must likewise be pointed out that Ong Bun Tua testified on the brochures allegedly of
Manila Gas and of Esso Gasul marked Exhs. "E" and "F" and on the alleged fact that
Manila Gas Corporation was importing from the United States "Ransome" burners. But
the same could not be given credence since he himself admitted during cross-
examination that he has never been connected with Manila Gas Corporation. He could
not even present any importation papers relating to the alleged imported ransome
burners. Neither did his wife.6
The above findings and conclusions of the Director of Patent were reiterated and affirmed by the
Court of Appeals.7
The validity of the patent issued by the Philippine Patent Office in favor of private respondent and
the question over the inventiveness, novelty and usefulness of the improved model of the LPG
burner are matters which are better determined by the Patent Office. The technical staff of the
Philippine Patent Office composed of experts in their field has by the issuance of the patent in
question accepted private respondent's model of gas burner as a discovery. There is a
presumption that the Office has correctly determined the patentability of the model8 and such
action must not be interfered with in the absence of competent evidence to the contrary.
The rule is settled that the findings of fact of the Director of Patents, especially when affirmed by
the Court of Appeals, are conclusive on this Court when supported by substantial evidence.
Petitioner has failed to show compelling grounds for a reversal of the findings and conclusions of
the Patent Office and the Court of Appeals.
The alleged failure of the Director of Patents and the Court of Appeals to accord evidentiary
weight to the testimonies of the witnesses of petitioner showing anticipation is not a justification to
grant the petition. Pursuant to the requirement of clear and convincing evidence to overthrow the
presumption of validity of a patent, it has been held that oral testimony to show anticipation is
open to suspicion and if uncorroborated by cogent evidence, as what occurred in this case, it may
be held insufficient.9
Finally, petitioner would want this Court to review all over again the evidence she presented
before the Patent Office. She argues that contrary to the decision of the Patent Office and the
Court of Appeals, the evidence she presented clearly proves that the patented model of private
respondent is no longer new and, therefore, fraud attended the acquisition of patent by private
respondent.

It has been held that the question on priority of invention is one of fact. Novelty and utility are
likewise questions of fact. The validity of patent is decided on the basis of factual inquiries.
Whether evidence presented comes within the scope of prior art is a factual issue to be resolved
by the Patent Office.10 There is question of fact when the doubt or difference arises as to the truth
or falsehood of alleged facts or when the query necessarily invites calibration of the whole
evidence considering mainly the credibility of witnesses, existence and relevance of specific
surrounding circumstances, their relation to each other and to the whole and the probabilities of
the situation.11

Time and again we have held that it is not the function of the Supreme Court to analyze or weigh
all over again the evidence and credibility of witnesses presented before the lower tribunal or
office. The Supreme Court is not a trier of facts. Its jurisdiction is limited to reviewing and revising
errors of law imputed to the lower court, its findings of fact being conclusive and not reviewable by
this Court.

WHEREFORE, the Petition is DENIED. The Decision of the Court of Appeals affirming that of the
Philippine Patent Office is AFFIRMED. Costs against petitioner.

SO ORDERED.
 Congress of the Philippines
Eleventh Congress
REPUBLIC ACT NO. 9150 August 06, 2001
AN ACT PROVIDING FOR THE PROTECTlON OF LAYOUT-DESIGNS (TOPOGRAPHIES) OF
INTEGRATED CIRCUITS, AMENDING FOR THE PURPOSE CERTAIN SECTIONS OF
REPUBLIC ACT NO. 8293, OTHERWISE KNOWN AS THE INTELLECTUAL PROPERTY CODE
OF THE PHILIPPINES AND FOR OTHER PURPOSES
Be it enacted by the Senate and the House of Representatives of the Philippines in Congress
assembled:
Section 1, Sections 112, 113, 114, 116, 117, 118, 119 and 120 under Chapter XIIl of R.A. No.
8293 are hereby amended to read as follows:
"CHAPTER XIII
"INDUSTRIAL DESIGN AND LAYOUT DESIGNS (TOPOGRAPHIES) OF INTEGRATED
CIRCUITS
"SEC. 112. Definition of Terms:"
"1. An Industrial Design is any composition of lines or colors or any three-dimensional
form, whether or not associated with lines or colors: Provided, That such composition or
form gives a special appearance to and can serve as pattern for an industrial product or
handicraft;
"2. Integrated Circuit means a product, in its final form, or an intermediate form, in which
the elements, at least one of which is an active element and some or all of the
interconnections are integrally formed in and/or on a piece of material, and which is
intended to perform an electronic function; and
"3. Layout-Design is synonymous With 'Topography' and means the three-dimensional
disposition, however expressed, of the elements, at least one of which is an active
element, and of some or all of the interconnections of an integrated circuit, or such a
three-dimensional disposition prepared for an integrated circuit intended for manufacture."
"SEC. 113. Substantive Conditions/or Protection. - 113.1. Only industrial designs that are
new or ornamental shall benefit from protection under this Act.
"113.2. Industrial designs dictated essentially by technical or functional considerations to
obtain a technical result or those that are contrary to public order, health or morals shall
not be protected.
"113.3. Only layout -designs of integrated circuits that are original shall benefit from
protection under this Act. A layout-design shall be considered original if it is the result of
its creator's own intellectual effort and is not commonplace among creators of layout-
designs and manufacturers of integrated circuits at the time of its creation.
"113.4. A layout-design consisting of a combination of elements and interconnections that
are commonplace shall be protected only if the combination, taken as a whole, is
original."
"SEC.114. Contents of the Application. - 114.1. Every application for registration of an
industrial design or layout-design shall contain:
"(a) A request for registration of the industrial design or layout-design;
"(b) Information identifying the applicant;
"(c) An indication of the kind of article of manufacture or handicraft to which the industrial
design or layout-design shall be applied;
"(d) A representation of the article of manufacture or handicraft by way of drawings,
photographs or adequate graphic representation of the industrial design or of the layout-
design as applied to the article of manufacture or handicraft which clearly and fully
discloses those features for which protection is claimed; and
"(e) The name and address of the creator, or where the applicant is not the creator, a
statement indicating the origin of the right to the industrial design or layout-design
registration.
"114.2. The application may be accompanied by a specimen of the article embodying the
industrial design or layout-design and shall be subject to the payment of the prescribed
fee."
"SEC.116. Examination. - 116.1. The Office shall accord as the filing date the date of
receipt of the application containing indications allowing the identity of the applicant to be
established and a representation of the article embodying the industrial design or the
layout -design or a pictorial representation thereof.
"116.2. If the application does not meet these requirements, the filing date should be that
date when all the elements specified in Sec. 114 are filed or the mistakes corrected.
Otherwise, if the requirements are not complied within the prescribed period, the
application shall be considered withdrawn.
"116.3. After the application has been accorded a filing date and the required fees paid on
time, the applicant shall comply with the requirements of Sec. 114 within the prescribed
period, otherwise the application shall be considered withdrawn.
"116.4. The Office shall examine whether the industrial design or layout-design complies
with requirements of Sec. 112 (Definitions) and Sec. 113 (Substantive Conditions for
Protection)."
"SEC. 117, Registration. - 117.1. Where the Office finds that the conditions referred to in
Sec. 113 are fulfilled, it shall order that registration be effected in the industrial design or
layout-design register and cause the issuance of an industrial design or layout-design
certificate of registration; otherwise, it shall refuse the application.
" 117.2. The form and contents of an industrial design or layout-design certificate shall be
established by the Registrations: Provided, That the name and address of the creator
shall be mentioned in every case.
" 117.3. Registration shall be published in the form and within the period fixed by the
Regulations.
" 117.4. The Office shall record in the register any change in the identity of the proprietor
of the industrial design or layout design or his representative, if proof thereof is furnished
to it. A fee shall be paid, with the request to record the change in the identity of the
proprietor, if the fee is not paid, the request shall be deemed not to have been filed. In
such case, the former proprietor and the former representative shall remain subject to the
rights and obligations as provided in this Act.
" 117.5. Anyone may inspect the Register and the files of registered industrial designs or
layout-designs including files of cancellation proceedings."
"SEC. 118. The Term of Industrial Design or Layout-Design Registration. - 118.1. The
registration of an industrial design shall be for a period of five (5) years from the filing date
of the application.
" 118.2. The registration of an industrial design may be renewed for not more than two (2)
consecutive periods of five (5) years each, by paying the renewal fee.
"118.3. The renewal fee shall be paid within twelve (12) months preceding the expiration
of the period of registration. However, a grace period of six (6) months shall be granted
for payment of the fees after such expiration, upon payment of a surcharge.
"118.4. The Regulations shall fix the amount of renewal fee, the surcharge and other
requirements regarding the recording of renewals of registration.
" 118.5. Registration of a layout-design shall be valid for a period often (10) years, without
renewal, and such validity to be counted from the date of commencement of the
protection accorded to the layout-design. The protection of a layout-design under this Act
shall commence:
"a) on the date of the first commercial exploitation, anywhere in the world, of the layout-
design by or with the consent of the right holder: Provided, That an application for
registration is filed with the Intellectual Property Office within two (2) years from such date
of first commercial exploitation; or
"b) on the filing date accorded to the application for the registration of the layout-design if
the layout-design has not been previously exploited commercially anywhere in the world."
"SEC. 119. Application of Other Sections and Chapters. - 119.1. The following provisions
relating to patents shall apply mutatis mutandis to an industrial design registration.
"SECTION21 - Novelty;
"SECTION 24 - Prior art: Provided, That the disclosure is contained in printed documents
or in any tangible form;
"SECTION 25 - Non-prejudicial Disclosure;
"SECTION 28 - Right to a Patent;
"SECTION 29 - First to File Rule;
"SECTION 30 - Inventions Created Pursuant to a Commission;
"SECTION 31 - Right of Priority: Provided, That the application for industrial design shall
be filed within six (6) months from the earliest filing date of the corresponding foreign
application;
"SECTION 33 - Appointment of Agent or Representative;
"SECTION 51 - Refusal of the Application;
"SECTION 56 to 60 - Surrender, Correction of and Changes in Patent;
CHAPTER VII - Remedies of a Person with a Right to Patent;
CHAPTER VIII - Rights of Patentees and Infringement of Patents; and
"CHAPTER XI - Assignment and Transmission of Rights
"119.2. If the essential elements of an industrial design which is the subject of an
application have been obtained from the creation of another person without his consent,
protection under this Chapter cannot be invoked against the injured party.
"119.3. The following provisions relating to patents shall apply mutatis mutandis to a
layout -design of integrated circuits registration:
"SECTION 28 - Right to a Patent;
"SECTION 29 - First to File Rule;
"SECTION 30 - Inventions Created Pursuant to a Commission;
"SECTION 33 - Appointment of Agent or Representative;
"SECTION 56 - Surrender of Patent;
"SECTION 57 - Correction of Mistakes of the Office;
"SECTION 58 - Correction of Mistakes in the Application;
"SECTION 59 - Changes in Patents;
"SECTION 60 - Form and Publication of Amendment;
"CHAPTER VII - Remedies of a Person with a Right to Patent;
"CHAPTER VIII - Rights of Patentees and Infringement of Patents: Provided, That the
layout-design rights and limitation of layout-design rights provided hereunder shall
govern:
"CHAPTER X - Compulsory Licensing;
"CHAPTER XI - Assignment and Transmission of Rights
"119.4. Rights Conferred to the Owner of a Layout-Design Registration. - The owner of a
layout-design registration shall enjoy the following rights:
"(1) to reproduce, whether by incorporation in an integrated circuit or otherwise, the
registered layout-design in its entirety or any part thereof, except the act of reproducing
any part that does not comply with the requirement of originality; and
"(2) to sell or otherwise distribute for commercial purposes the registered layout design,
an article or an integrated circuit in which the registered layout-design is incorporated.
"119.5. Limitations of Layout Rights. - The owner of a layout design has no right to
prevent third parties from reproducing, selling or otherwise distributing for commercial
purposes the registered layout-design in the following circumstances:
"(1) Reproduction of the registered layout-design for private purposes or for the sole
purpose of evaluation, analysis, research or teaching;
"(2) Where the act is performed in respect of a layout-design created on the basis of such
analysis or evaluation and which is itself original in the meaning as provided herein;
"(3) Where the act is performed in respect of a registered lay-out-design, or in respect of
an integrated circuit in which such a layout-design is incorporated, that has been put on
the market by or with the consent of the right holder;
"(4) In respect of an integrated circuit where the person performing or ordering such an
act did not know and had no reasonable ground to know when acquiring the integrated
circuit or the article incorporating such an integrated circuit, that it incorporated an
unlawfully reproduced layout-design: Provided, however, That after the time that such
person has received sufficient notice that the layout-design was unlawfully reproduced,
that person may perform any of the said acts only with respect to the stock on hand or
ordered before such time and shall be liable to pay to the right holder a sum equivalent to
at least 5% of net sales or such other reasonable royalty as would be payable under a
freely negotiated license in respect of such layout-design; or
"(5) Where the act is performed in respect of an identical layout-design which is original
and has been created independently by a third party."
"SEC. 120. Cancellation of Design Registration. - 120.1. At any time during the term of
the industrial design registration, any person upon payment of the required fee, may
petition the Director of Legal Affairs to cancel the industrial design on any of the following
grounds:
"(a) If the subject matter of the industrial design is not registerable within the terms of
Sections 112 and 113;
"(b) If the subject matter is not new; or "(c) If the subject matter of the industrial design
extends beyond the content of the applic.'1tion as originally filed.
"120.2. Where the grounds for cancellation relate to a part of the industrial design,
cancellation may be effected to such extent only. The restriction may be effected in the
form of an alteration of the effected features of the design.
"120.3. Grounds for Cancellation of Layout-Design of Integrated Circuits.- Any interested
person may petition that the registration of a layout-design be cancelled on the ground
that:
"(i) the layout-design is not protectable under this Act;
"(ii) the right holder is not entitled to protection under this Act; or
 "(iii) where the application for registration of the layout-design, was not filed within two (2)
years from its first commercial exploitation anywhere in the world.

"Where the grounds for cancellation are established with respect only to a part of the FELICIANO BELMONTE JR.
layout-design, only the corresponding part of the registration shall be cancelled. Speaker of the House of Representatives

"Any cancelled layout-design registration or part thereof, shall be regarded as null and
void from the beginning and may be expunged from the records of the Intellectual
Property Office. Reference to all cancelled layout-design registration shall be published in
the IPO Gazette." (Sgd)

Section 2. Implementing Rules and Regulations. - The Intellectual Property Office may issue
Regulations prescribing details for the implementation of this law. The Regulations may, in
particular, provide for the payment of fees in connection with applications for the registration of
layout-designs of integrated circuits and matters related thereto, including Administrative
Instructions relating to the procedures and other functions of the responsible until duly designated LUTGARDO B. BARBO
by the Director General. Secretary of the Senate

Section 3. Applicability. - The provisions of this Act shall apply to layout-designs of integrated
circuits that were commercially exploited anywhere in the world from and after January 1998
provided they meet the conditions for protection under this Act.
(Sgd)
Section 4. Repealing Clause. - All acts and parts of acts inconsistent herewith are hereby
repealed or amended accordingly.

Section 5. Separability Clause. - If any provision of this Act or the application of such provision to
any circumstance is held invalid, the remainder of this Act shall not be affected thereby. ROBERTO P. NAZARENO
Secretary General
Section 6. Effectivity. - This Act shall take effect fifteen (15) days after its publication in two (2) House of Representatives
newspapers of general circulation.

Approved,

(Sgd) Approved: August 06, 2001

(Sgd)

AQUILINO Q. PIMENTEL JR.

President of the Senate
GLORIA MACAPAGAL-ARROYO
President of the Philippines

(Sgd)
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
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.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 167715 November 17, 2010
PHIL PHARMAWEALTH, INC., Petitioner,
vs.
PFIZER, INC. and PFIZER (PHIL.) INC., Respondents.
DECISION
PERALTA, J.:
Before the Court is a petition for review on certiorari seeking to annul and set aside the
Resolutions dated January 18, 20051 and April 11, 20052 by the Court of Appeals (CA) in CA-G.R.
SP No. 82734.
The instant case arose from a Complaint3 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 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.
7. Patent No. 21116 thus covers ampicillin sodium/sulbactam sodium (hereafter
"Sulbactam Ampicillin"). Ampicillin sodium is a specific example of the broad beta-lactam
antibiotic disclosed and claimed in the Patent. It is the compound which efficacy is being
enhanced by co-administering the same with sulbactam sodium. Sulbactam sodium, on
the other hand, is a specific compound of the formula IA disclosed and claimed in the
Patent.
8. Pfizer is marketing Sulbactam Ampicillin under the brand name "Unasyn." Pfizer's
"Unasyn" products, which come in oral and IV formulas, are covered by Certificates of
Product Registration ("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.
9. Sometime in January and February 2003, complainants came to 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 x4
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 Order5 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 Injunction6 which, however, was denied by the BLA-IPO in an Order7 dated October
15, 2003.
Respondents filed a Motion for Reconsideration but the same was also denied by the BLA-IPO in
a Resolution8 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.
While the case was pending before the CA, respondents filed a Complaint9 with the Regional Trial
Court (RTC) of Makati City for infringement and unfair competition with damages against herein
petitioner. In said case, respondents prayed for the issuance of a temporary restraining order and
preliminary injunction to prevent herein petitioner from importing, distributing, selling or offering for
sale sulbactam 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 the
injunction permanent.
10
On August 24, 2004, the RTC of Makati City issued an Order directing the issuance of a
temporary restraining order conditioned upon respondents' filing of a bond.
In a subsequent Order11 dated April 6, 2005, the same RTC directed the issuance of a writ of
preliminary injunction "prohibiting and restraining [petitioner], its agents, representatives and
assigns from importing, distributing or selling Sulbactam Ampicillin products to any entity in the
Philippines."
Meanwhile, on November 16, 2004, petitioner filed a Motion to Dismiss12 the petition filed with the
CA on the ground of forum shopping, contending that the case 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 Sulbactam Ampicillin products.
On January 18, 2005, the CA issued its questioned Resolution13 approving the bond 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 conditioned upon the filing of a bond. On
even date, the CA issued a temporary restraining order14 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 Dismiss15 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.
Hence, the present petition raising the following 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?16
In the first issue raised, petitioner argues that respondents' exclusive right to monopolize the
subject matter of the patent exists only within the term of the patent. 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 issuance of a restraining order or injunction against
petitioner insofar as the disputed patent is concerned.
The Court agrees.
Section 37 of Republic Act No. (RA) 165,17 which was the governing law at the time of the
issuance of respondents' patent, provides:
l 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.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 120 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 ₱1,000,000.00 as actual damages;
(b) ₱700,000.00 as attorney's fees and litigation expenses;
(d) ₱1,000,000.00 as exemplary damages; and
(d) costs of this suit.
(iii) ordering the condemnation, seizure or forfeiture of respondent'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 Office; and
(iv) making the injunction permanent.32
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,
or from otherwise infringing 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.
(c) After trial, render judgment:
(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 ₱3,000,000.00 as actual damages;
(ii) ₱500,000.00 as attorney's fees and ₱1,000,000.00 as litigation
expenses;
(iii) ₱3,000,000.00 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.341avvphi1
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.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 149907 April 16, 2009
ROMA DRUG and ROMEO RODRIGUEZ, as Proprietor of ROMA DRUG, Petitioners,
vs.
THE REGIONAL TRIAL COURT OF GUAGUA, PAMPANGA, THE PROVINCIAL
PROSECUTOR OF PAMPANGA, BUREAU OF FOOD & DRUGS (BFAD) and GLAXO
SMITHKLINE, Respondents.
DECISION
TINGA, J.:
On 14 August 2000, a team composed of the National Bureau of Investigation (NBI) operatives
and inspectors of the Bureau of Food and Drugs (BFAD) conducted a raid on petitioner Roma
Drug, a
duly registered sole proprietorship of petitioner Romeo Rodriguez (Rodriguez) operating a drug
store located at San Matias, Guagua, Pampanga. The raid was conducted pursuant to a search
warrant1 issued by the Regional Trial Court (RTC), Branch 57, Angeles City. The raiding team
seized several imported medicines, including Augmentin (375mg.) tablets, Orbenin (500mg.)
capsules, Amoxil (250mg.) capsules and Ampiclox (500mg.).2 It appears that Roma Drug is one of
six drug stores which were raided on or around the same time upon the request of SmithKline
Beecham Research Limited (SmithKline), a duly registered corporation which is the local
distributor of pharmaceutical products manufactured by its parent London-based corporation. The
local SmithKline has since merged with Glaxo Wellcome Phil. Inc to form Glaxo SmithKline,
private respondent in this case. The seized medicines, which were manufactured by SmithKline,
were imported directly from abroad and not purchased through the local SmithKline, the
authorized Philippine distributor of these products.
The NBI subsequently filed a complaint against Rodriguez for violation of Section 4 (in relation to
Sections 3 and 5) of Republic Act No. 8203, also known as the Special Law on Counterfeit Drugs
(SLCD), with the Office of the Provincial Prosecutor in San Fernando, Pampanga. The section
prohibits the sale of counterfeit drugs, which under Section 3(b)(3), includes "an unregistered
imported drug product." The term "unregistered" signifies the lack of registration with the Bureau of
Patent, Trademark and Technology Transfer of a trademark, tradename or other identification
mark of a drug in the name of a natural or juridical person, the process of which is governed under
Part III of the Intellectual Property Code.
In this case, there is no doubt that the subject seized drugs are identical in content with their
Philippine-registered counterparts. There is no claim that they were adulterated in any way or
mislabeled at least. Their classification as "counterfeit" is based solely on the fact that they were
imported from abroad and not purchased from the Philippine-registered owner of the patent or
trademark of the drugs.
During preliminary investigation, Rodriguez challenged the constitutionality of the SLCD. However,
Assistant Provincial Prosecutor Celerina C. Pineda skirted the challenge and issued a Resolution
dated 17 August 2001 recommending that Rodriguez be charged with violation of Section 4(a) of
the SLCD. The recommendation was approved by Provincial Prosecutor Jesus Y. Manarang
approved the recommendation.3
Hence, the present Petition for Prohibition questing the RTC-Guagua Pampanga and the
Provincial Prosecutor to desist from further prosecuting Rodriguez, and that Sections 3(b)(3), 4
and 5 of the SLCD be declared unconstitutional. In gist, Rodriguez asserts that the challenged
provisions contravene three provisions of the Constitution. The first is the equal protection clause
of the Bill of Rights. The two other provisions are Section 11, Article XIII, which mandates that the
State make "essential goods, health and other social services available to all the people at
affordable cost;" and Section 15, Article II, which states that it is the policy of the State "to protect
and promote the right to health of the people and instill health consciousness among them."
Through its Resolution dated 15 October 2001, the Court issued a temporary restraining order
enjoining the RTC from proceeding with the trial against Rodriguez, and the BFAD, the NBI and
Glaxo Smithkline from prosecuting the petitioners.4
Glaxo Smithkline and the Office of the Solicitor General (OSG) have opposed the petition, the
latter in behalf of public respondents RTC, Provincial Prosecutor and Bureau of Food and Drugs
(BFAD). On the constitutional issue, Glaxo Smithkline asserts the rule that the SLCD is presumed
constitutional, arguing that both Section 15, Article II and Section 11, Article XIII "are not self-
executing provisions, the disregard of which can give rise to a cause of action in the courts." It
adds that Section 11, Article XIII in particular cannot be work "to the oppression and unlawful of
the property rights of the legitimate manufacturers, importers or distributors, who take pains in
having imported drug products registered before the BFAD." Glaxo Smithkline further claims that
the SLCD does not in fact conflict with the aforementioned constitutional provisions and in fact are
in accord with constitutional precepts in favor of the people’s right to health.
The Office of the Solicitor General casts the question as one of policy wisdom of the law that is,
beyond the interference of the judiciary.5 Again, the presumption of constitutionality of statutes is
invoked, and the assertion is made that there is no clear and unequivocal breach of the
Constitution presented by the SLCD.
II.
The constitutional aspect of this petition raises obviously interesting questions. However, such
questions have in fact been mooted with the passage in 2008 of Republic Act No. 9502, also
known as the "Universally Accessible Cheaper and Quality Medicines Act of 2008".6
Section 7 of Rep. Act No. 9502 amends Section 72 of the Intellectual Property Code in that the
later law unequivocally grants third persons the right to import drugs or medicines whose patent
were registered in the Philippines by the owner of the product:
Sec. 7. Section 72 of Republic Act No. 8293, otherwise known as the Intellectual Property Code of
the Philippines, is hereby amended to read as follows:
"Sec. 72. Limitations of Patent Rights. – The owner of a patent has no right to prevent third parties
from performing, without his authorization, the acts referred to in Section 71 hereof in the following
circumstances:
"72.1. Using a patented product which has been put on the market in the Philippines by the owner
of the product, or with his express consent, insofar as such use is performed after that product has
been so put on the said market: Provided, That, with regard to drugs and medicines, the
limitation on patent rights shall apply after a drug or medicine has been introduced in the
Philippines or anywhere else in the world by the patent owner, or by any party authorized
to use the invention: Provided,
further, That the right to import the drugs and medicines contemplated in this section shall
be available to any government agency or any private third party;
"72.2. Where the act is done privately and on a non-commercial scale or for a non-
commercial purpose: Provided, That it does not significantly prejudice the economic
interests of the owner of the patent;
"72.3. Where the act consists of making or using exclusively for experimental use of the
invention for scientific purposes or educational purposes and such other activities directly
related to such scientific or educational experimental use;
"72.4. In the case of drugs and medicines, where the act includes testing, using, making
or selling the invention including any data related thereto, solely for purposes reasonably
related to the development and submission of information and issuance of approvals by
government regulatory agencies required under any law of the Philippines or of another
country that regulates the manufacture, construction, use or sale of any product:
Provided, That, in order to protect the data submitted by the original patent holder from
unfair commercial use provided in Article 39.3 of the Agreement on Trade-Related
Aspects of Intellectual Property Rights (TRIPS Agreement), the Intellectual Property
Office, in consultation with the appropriate government agencies, shall issue the
appropriate rules and regulations necessary therein not later than one hundred twenty
(120) days after the enactment of this law;
"72.5. Where the act consists of the preparation for individual cases, in a pharmacy or by
a medical professional, of a medicine in accordance with a medical shall apply after a
drug or medicine has been introduced in the Philippines or anywhere else in the world by
the patent owner, or by any party authorized to use the invention: Provided, further, That
the right to import the drugs and medicines contemplated in this section shall be available
to any government agency or any private third party; xxx7
The unqualified right of private third parties such as petitioner to import or possess "unregistered
imported drugs" in the Philippines is further confirmed by the "Implementing Rules to Republic Act
No. 9502" promulgated on 4 November 2008.8 The relevant provisions thereof read:
Rule 9. Limitations on Patent Rights. The owner of a patent has no right to prevent third parties
from performing, without his authorization, the acts referred to in Section 71 of the IP Code as
enumerated hereunder:
(i) Introduction in the Philippines or Anywhere Else in the World.
Using a patented product which has been put on the market in the Philippines by the owner of the
product, or with his express consent, insofar as such use is performed after that product has been
so put on the said market: Provided, That, with regard to drugs and medicines, the limitation on
patent rights shall apply after a drug or medicine has been introduced in the Philippines or
anywhere else in the world by the patent owner, or by any party authorized to use the
invention: Provided, further, That the right to import the drugs and medicines contemplated in this
section shall be available to any government agency or any private third party. (72.1)1avvphi1
The drugs and medicines are deemed introduced when they have been sold or offered for sale
anywhere else in the world. (n)
It may be that Rep. Act No. 9502 did not expressly repeal any provision of the SLCD. However, it
is clear that the SLCO’s classification of "unregistered imported drugs" as "counterfeit drugs," and
of corresponding criminal penalties therefore are irreconcilably in the imposition conflict with Rep.
Act No. 9502 since the latter indubitably grants private third persons the unqualified right to import
or otherwise use such drugs. Where a statute of later date, such as Rep. Act No. 9502, clearly
reveals an intention on the part of the legislature to abrogate a prior act on the subject that
intention must be given effect.9 When a subsequent enactment covering a field of operation
coterminus with a prior statute cannot by any reasonable construction be given effect while the
prior law remains in operative existence because of irreconcilable conflict between the two acts,
the latest legislative expression prevails and the prior law yields to the extent of the
conflict.10 Irreconcilable inconsistency between two laws embracing the same subject may exist
when the later law nullifies the reason or purpose of the earlier act, so that the latter loses all
meaning and function.11 Legis posteriors priores contrarias abrogant.
For the reasons above-stated, the prosecution of petitioner is no longer warranted and the
quested writ of prohibition should accordingly be issued.
III.
Had the Court proceeded to directly confront the constitutionality of the assailed provisions of the
SLCD, it is apparent that it would have at least placed in doubt the validity of the provisions. As
written, the law makes a criminal of any person who imports an unregistered drug regardless of
the purpose, even if the medicine can spell life or death for someone in the Philippines. It does not
accommodate the situation where the drug is out of stock in the Philippines, beyond the reach of a
patient who urgently depends on it. It does not allow husbands, wives, children, siblings, parents
to import the drug in behalf of their loved ones too physically ill to travel and avail of the meager
personal use exemption allotted by the law. It discriminates, at the expense of health, against poor
Filipinos without means to travel abroad to purchase less expensive medicines in favor of their
wealthier brethren able to do so. Less urgently perhaps, but still within the range of constitutionally
protected behavior, it deprives Filipinos to choose a less expensive regime for their health care by
denying them a plausible and safe means of purchasing medicines at a cheaper cost.

The absurd results from this far-reaching ban extends to implications that deny the basic
decencies of humanity. The law would make criminals of doctors from abroad on medical missions
of such humanitarian organizations such as the International Red Cross, the International Red
Crescent, Medicin Sans Frontieres, and other

like-minded groups who necessarily bring their own pharmaceutical drugs when they embark on
their missions of mercy. After all, they are disabled from invoking the bare "personal use"
exemption afforded by the SLCD.

Even worse is the fact that the law is not content with simply banning, at civil costs, the importation
of unregistered drugs. It equates the importers of such drugs, many of whom motivated to do so
out of altruism or basic human love, with the malevolents who would alter or counterfeit
pharmaceutical drugs for reasons of profit at the expense of public safety. Note that the SLCD is a
special law, and the traditional treatment of penal provisions of special laws is that of malum
prohibitum–or punishable regardless of motive or criminal intent. For a law that is intended to help
save lives, the SLCD has revealed itself as a heartless, soulless legislative piece.

The challenged provisions of the SLCD apparently proscribe a range of constitutionally

permissible behavior. It is laudable that with the passage of Rep. Act No. 9502, the State has
reversed course and allowed for a sensible and compassionate approach with respect to the
importation of pharmaceutical drugs urgently necessary for the people’s constitutionally-
recognized right to health.

WHEREFORE, the petition is GRANTED in part. A writ of prohibition is hereby ISSUED

commanding respondents from prosecuting petitioner Romeo Rodriguez for violation of Section 4
or Rep. Act No. 8203. The Temporary Restraining Order dated 15 October 2001 is hereby made
PERMANENT. No pronouncements as to costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
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.

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

 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
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.)
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.

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.)

THIRD DIVISION
G. R. No. 126627 August 14, 2003
SMITH KLINE BECKMAN CORPORATION, Petitioner,
vs.
THE HONORABLE COURT OF APPEALS and TRYCO PHARMA
CORPORATION, Respondents.
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. 145611 for the aforesaid invention was issued to
petitioner for a term of seventeen (17) years.
The letters patent provides in its claims2 that the patented invention consisted of a new compound
named methyl 5 propylthio-2-benzimidazole carbamate and the methods or compositions utilizing
the compound as an active ingredient in 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. 145614 as well as committed unfair competition under Article 189,
paragraph 1 of the Revised Penal Code and Section 29 of Republic Act No. 166 (The Trademark
Law) for advertising and selling as its own the drug Impregon although the same contained
petitioner’s patented Albendazole.5
On motion of petitioner, Branch 125 of the Caloocan RTC issued a temporary restraining order
against private respondent enjoining it from committing acts of patent infringement and unfair
competition.6 A writ of preliminary injunction was subsequently issued.7
Private respondent in its Answer8 averred that Letters Patent No. 14561 does not cover the
substance Albendazole for nowhere in it does that word appear; that even if the patent were to
include Albendazole, such substance is unpatentable; that the Bureau of Food and Drugs allowed
it to manufacture and market Impregon with Albendazole as its known ingredient; that there is no
proof that it passed 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; ₱1,000,000.00 in moral damages; ₱300,000.00 in exemplary damages; and
₱150,000.00 in attorney’s 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, plaintiff’s 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 attorney’s 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 court’s finding
that private respondent was not liable for any infringement of the patent of petitioner in light of the
latter’s failure to show that Albendazole is the same as the compound subject of Letters Patent
No. 14561. Noting petitioner’s admission of the issuance by the U.S. of a patent for Albendazole in
the name of Smith Kline and French Laboratories which was petitioner’s 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
petitioner’s 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 petitioner’s 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 Office’s
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.
Petitioner’s motion for reconsideration of the Court of Appeals’ decision having been denied11 the
present petition for review on certiorari12 was filed, assigning as errors the following:
I. THE COURT OF APPEALS GRAVELY ERRED IN NOT FINDING THAT
ALBENDAZOLE, THE ACTIVE INGREDIENT IN TRYCO’S "IMPREGON" DRUG, IS
INCLUDED IN PETITIONER’S 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 ATTORNEY’S 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 petitioner’s 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-Rejoinder13 that although methyl 5 propylthio-2-benzimidazole
carbamate is not identical with Albendazole, the former is an improvement or improved version of
the latter thereby making both substances still substantially the same.
With respect to the award of actual damages in favor of private respondent in the amount of
₱330,000.00 representing lost profits, petitioner assails the same as highly speculative and
conjectural, hence, without basis. It assails too the award of ₱100,000.00 in attorney’s fees as not
falling under any of the instances enumerated by law where recovery of attorney’s 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 petitioner’s 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
court’s 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, petitioner’s 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 compound’s
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 Albendazole’s 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 petitioner’s
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
petitioner’s 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
respondent’s 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 petitioner’s evidence fails to
convince this Court of the substantial sameness of petitioner’s 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, petitioner’s 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 petitioner’s compound works. The testimony of Dr.
Orinion lends no support to petitioner’s 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 petitioner’s 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.1âwphi1
The foregoing discussions notwithstanding, this Court does not sustain the award of actual
damages and attorney’s fees in favor of private respondent. The claimed actual damages of
₱330,000.00 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 ₱100,000.00
monthly gross sales for eleven months, were supported by the testimonies of private respondent’s
President25 and Executive Vice-President that the average monthly sale of Impregon was
₱100,000.00 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 respondent’s 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 attorney’s fees to
private respondent anchored on Article 2208 (2) of the Civil Code, private respondent having been
allegedly forced to litigate as a result of petitioner’s suit. Even if a claimant is compelled to litigate
with third persons or to incur expenses to protect its rights, still attorney’s fees may not be
awarded where no sufficient showing of bad faith could be reflected in a party’s persistence in a
case other than an erroneous conviction of the righteousness of his cause.29 There exists no
evidence on record indicating that petitioner was moved by malice in suing private respondent.
This Court, however, grants private respondent temperate or moderate damages in the amount of
₱20,000.00 which it finds reasonable under the circumstances, it having suffered some pecuniary
loss the amount of which cannot, from the nature of the case, be established with certainty.30
WHEREFORE, the assailed decision of the Court of Appeals is hereby AFFIRMED with
MODIFICATION. The award of actual or compensatory damages and attorney’s 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.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 118708 February 2, 1998
CRESER PRECISION SYSTEMS, INC., petitioner,
vs.
COURT OF APPEALS AND FLORO INTERNATIONAL CORP., respondents.
MARTINEZ, J.:
This petition for review on certiorari assails the decision 1 of the Court of Appeals dated November
9, 1994 in C.A.-G.R. SP No. 34425 entitled "Floro International Corp. vs. Hon. Tirso D.C Cruz and
Creser Precision System, Inc.", the dispositive portion of which reads:
WHEREFORE, THE PETITION IS HEREBY GRANTED. THE COMPLAINT FOR
INJUNCTION AND DAMAGES, CIVIL CASE NO. 93-1856 BEFORE THE
RESPONDENT JUDGE IS HEREBY ORDERED DISMISSED AND HIS
ORDERS THEREIN OF DECEMBER 29, 1993 AND MAY 11, 1994 ARE
ORDERED SET ASIDE.
Private respondent is a domestic corporation engaged in the manufacture, production, distribution
and sale of military armaments, munitions, airmunitions and other similar materials. 2
On January 23, 1990, private respondent was granted by the Bureau of Patents, Trademarks and
Technology Transfer (BPTTT), a Letters Patent No. UM-69383 covering an aerial fuze which was
published in the September-October-1990, Vol. III, No. 5 issue of the Bureau of Patent's 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
letter5 to petitioner advising it of its existing patent and its rights thereunder, warning petitioner of a
possible court action and/or application for injunction, should it proceed with the scheduled testing
by the military on December 7, 1993.
In response to private respondent's demand, petitioner filed on December 8, 1993 a complaint6 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 it developed as early
as December 1981 under the Self-Reliance Defense Posture Program (SRDP) of the AFP; that
sometime in 1986, petitioner began supplying the AFP with the said aerial fuze; that private
respondent's aerial fuze is identical in every respect to the petitioner's fuze; and that the only
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 for infringement against it since it has no patent for
the aerial fuze which it claims to have invented; that petitioner's available remedy is to 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 rights over its patent.
On December 29, 1993, the trial court issued an Order 8 granting the issuance of a writ of
preliminary injunction against private respondent the dispositive portion of which reads:
WHEREFORE, 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 court in its Order9 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 plaintiff's 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 plaintiff's 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 defendant's assertion that an action for
infringement may only be brought by "anyone possessing right, title or interest to
the patented invention," (Section 42, RA 165) qualified by Sec. 10, RA 165 to
include only "the first true and actual inventor, his heirs, legal representatives or
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 defendant's letter. With the
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 defendant's claim is primarily hinged on its patent (Letters Patent No.
UM-6983) the validity of which is being questioned in this case.
WHEREFORE, premises considered, the Motion for Reconsideration is hereby
denied for lack of merit.
SO ORDERED.
Aggrieved, private respondent on June 27, 1994, 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 respondent's
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
court's 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 petitioner's 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:
Sec. 42. Civil action for infringement. — Any patentee, or anyone possessing any
right, title or interest in and to the patented invention, whose rights have been
infringed, may bring a civil action before the proper Court of First Instance (now
Regional Trial court), to recover from the infringer damages sustained by reason
of the infringement and to secure an injunction for the protection of his right. . . .
Under the aforequoted law, only the patentee or his successors-in-interest may 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 patentee's
successors-in-interest, assignees or grantees since actions for infringement of patent may be
brought in the name of the person or persons interested, whether as patentee, assignees, or as
grantees, of the exclusive right. 12 Moreover, there can be no infringement of a patent until a
patent has been issued, since whatever right one has to the invention covered by the patent arises
alone from the grant of patent. 13 In short, a person or entity who has not been granted letters
patent over an invention and has not acquired any light or title thereto either as assignee or as
licensee, has no cause of action for infringement because the right to maintain an infringement
suit depends on the existence of the patent. 14
Petitioner admits it has no patent over its aerial fuze. Therefore, it has no legal basis or cause of
action to institute the petition for injunction and damages arising from the alleged infringement by
private respondent. While petitioner claims to be the 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, an inventor has no common-law right to a monopoly of
his invention. He has the right to make, use and vend his own invention, but if he voluntarily
discloses it, such as by 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, petitioner's remedy is
not to file an action for injunction or infringement but to file a petition for cancellation of private
respondent's patent. Petitioner however failed to do so. As such, it can not now assail or impugn
the validity of the private respondent's letters patent by claiming that it is the true and actual
inventor of the aerial fuze.

Thus, as correctly ruled by the respondent Court of Appeals in its assailed decision: "since the
petitioner (private respondent herein) is the patentee of the disputed invention embraced by letters
of patent UM No. 6938 issued to it on January 23, 1990 by the Bureau of Patents, it has in its
favor not only the presumption of validity of its patent, but that of a legal and factual 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. The technical Staff
of 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
respondent's 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 of jurisdiction or grave abuse of
discretion, we sustain the assailed decision of the respondent Court of Appeal.

WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED. No pronouncement as

to costs.

SO ORDERED.