[1] G.R.
L-45101 November 28, 1986 Accordingly, a single instance of public use of the invention by a patentee for
ROSARIO C. MAGUAN (formerly ROSARIO C. TAN), petitioner,
vs. THE HONORABLE COURT OF APPEALS and SUSANA
LUCHAN, respondents.
Patents; Jurisdiction; Injunction; A regular court (RTC) has
jurisdiction to determine the issue of novelty or prior use when a patent is
sought to be enforced, for the purpose of deciding whether or not to issue a
writ of preliminary injunction.—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 x x x 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).
Same; Evidence; The burden of proof to substantiate a charge of
patent infringement lies with the plaintiff. Once the patent is in evidence, the
burden of evidence is upon the defendant to overcome this presumption.—
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.
Same; Words and Phrases; When an invention is novel or original,
explained.—lt 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.
‫ﻫ‬Law on Patents (Cases)
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.
Same; Injunction; In actions for patent infringement a writ of
injunction will not issue unless the validity of the patent in relation to the
issue of novelty and originality of the alleged invention, is clear and beyond
question. If a fair case of invalidity, after preliminary hearing is presented,
injunction must not issue.—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 proof s 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." All these notwithstanding the trial court nonetheless issued the
writ of preliminary injunction which under the circumstances should be
denied. 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 existence of the
right to be protected and the violation of said right. (Buayan Cattle Co., Inc.
v. Quintillan, 128 SCRA 276).
Appeal; Certiorari; Certiorari may be availed of where appeal though
available, is inadequate, as in wrongful issuance of preliminary injunction.—
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 power 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 [1978] where
the First Division of the Supreme Court ruled that "The prerogative writ of
certiorari may be applied for by proper petition notwithstanding the existence
of the regular remedy of an appeal in due cause when among other reasons,
the broader interests of justice so require or an ordinary appeal is not an
adequate remedy.
Page 1 of 65
 Same; Same; Actions; Judges; Judges are mere nominal parties.—
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).
Patents; Actions; Prescription; Claim of prescription may be availed
of by patent holder in petitions for cancellation at the Patent Office, but not
in ordinary civil actions for infringement of patent.—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.
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)
‫ﻫ‬Law on Patents (Cases)
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 infringement of said patents and therefore its
immediate discontinuance is demanded, otherwise it will be compelled to
take judicial action. (Rollo, pp. 7-8).
Private respondent replied stating that her products are 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:
Page 2 of 65
 (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).
‫ﻫ‬Law on Patents (Cases)
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
Page 3 of 65
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 by the grounds embodied in the motion for reconsideration filed by herein
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
‫ﻫ‬Law on Patents (Cases)
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
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
Page 4 of 65
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).
‫ﻫ‬Law on Patents (Cases)
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.
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).
Page 5 of 65
All these notwithstanding, the trial court nonetheless issued the writ of
preliminary injunction which under the circumstances should be denied.
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 existence of the right to be
protected and the violation of said right. (Buayan Cattle Co., Inc. v. Quintillan,
128 SCRA 276).
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.

Under the above established principles, it appears obvious that the trial court SO ORDERED.
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 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).

‫ﻫ‬Law on Patents (Cases) Page 6 of 65

[2&10] G.R. No. 14101           September 24, 1919
ANGEL VARGAS, plaintiff-appellant, vs. F. M. YAPTICO & CO.
(Ltd.), defendant-appellee.
1.PROPERTY; PATENTS; 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.
2.ID. ; ID. ; VALIDITY ; JUDICIARY.—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."
3.ID.; ID.; ID.; ID.; BURDEN OF PROOF.—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.
4.ID.; ID.; ID.; "VARGAS PLOW"; NOVELTY, INVENTION, OR DISCOVERY.
—In order to give existence to the right to a patent the element of novelty, invention,
or discovery must be shown.
5.ID. ; ID. ; ID. ; ID. ; REPAIRS.—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 refitting the machine for use, and thus permissible.
6.ID. ; ID. ; ID. ; ID. ; PUBLIC USE OR SALE.—To entitle a man to a patent, the
invention must be new to the world.
7.ID.; ID.; ID.; ID.; ID.—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.
8.ID. ; ID. ; ID. ; ID. ; ID.—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.
9.ID.; ID.; ID.; ID.; ID.—Held: That since a preponderance of the evidence is to the
effect that for more than two years before the application for the original letters
patent there was, by the consent and allowance of the plaintiff, a public use of the
‫ﻫ‬Law on Patents (Cases)
invention covered by them, namely, of the so-called "Vargas Plow," the patent is
void.
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
Page 7 of 65
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,
‫ﻫ‬Law on Patents (Cases)
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
Page 8 of 65
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
‫ﻫ‬Law on Patents (Cases)
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.
Page 9 of 65
[3] G.R. No. L-36650             January 27, 1933
stipulation of facts:
ANGEL VARGAS, plaintiff-appellee, vs.PETRONILA CHUA, ET
AL., defendants-appellants.
PATENT FOR INVENTION; PLOWS.—In view of ,the facts stated in the
decision, Held: That the appellee is not entitled to the protection of his invention 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.
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.
‫ﻫ‬Law on Patents (Cases)
In addition to the evidence presented, the parties submitted the following
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.
Page 10 of 65
 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.
‫ﻫ‬Law on Patents (Cases)
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
Page 11 of 65
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
‫ﻫ‬Law on Patents (Cases)
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.
Page 12 of 65
[4] G.R. No. L-38010         December 21, 1933
PATRICK HENRY FRANK and WILLIAM HENRY GOHN, plaintiffs-
appellants, vs. G. KOSUYAMA, defendant-appellee.
1.PATENT; ESSENTIAL ELEMENTS.—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 sec. 102, p. 98).
2.ID.; KNOWLEDGE AND USE BY THE PUBLIC.—Before the plaintiffs
herein obtained their patent, they themselves had already publicly used the
same kind of machine for many 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.
3.ID.; ANNULMENT.—Notwithstanding all the facts herein stated, the trial
court did not annul the plaintiffs' patent and the defendant herein insists that
the patent in question should be declared null and void. In view of the nature
of 'the action brought by the plaintiffs, annulment does not lie in the absence
of a crosscomplaint to that effect.
4.ID.; INFRINGEMENT.—The def endant cannot be made civilly liable for
alleged infringement of the patent on which the action is based on the ground
that the machines manufactured and sold by him did not have any essential
part unknown to the public in the Province of Davao at the time the plaintiffs
applied for and obtained their patent for improved abaca stripping machines.
5.APPLICABILITY OF THE DOCTRINE OF "STARE DECISIS".—The
doctrine laid down in the case of Frank and Gohn vs. Benito (51 Phil., 712),
to the effect that the defendant therein had actually infringed upon the patent
of the therein plaintiffs cannot be invoked in this case. It is true that the then
plaintiffs in the former and those in the latter case are the same but the
defendant therein did not set up the special defenses as alleged by the herein
defendant. Furthermore, the plaintiffs therein had only confined themselves
to presenting the patent, or rather, a copy thereof, wherein mention of the
"spindle" was made, and this court took for granted their claim that it was
one of the essential characteristics thereof which had been imitated or copied
by the therein defendant.
IMPERIAL, J.:
‫ﻫ‬Law on Patents (Cases)
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
Page 13 of 65
 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
‫ﻫ‬Law on Patents (Cases)
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.
Page 14 of 65
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.

‫ﻫ‬Law on Patents (Cases) Page 15 of 65

[5] G.R. No. L-32160 January 30, 1982
DOMICIANO A. AGUAS, petitioner, vs. CONRADO G. DE LEON and
COURT OF APPEALS, respondents.
Commercial Law; Patents; Phil Patents Office; Determination of
patentability of a product within the competence of the Philippines Patent
Office; Presumption that determination of Patents Office of product’s patent
ability is correct.—The validity 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 patent ability of the improvement by the private
respondent of the process in question.
Same; Same; Tile Making; Where improvement in tile making is
inventive and different from old process of tile making, improvement is
patent able.—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
precast 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. 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. x x x 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.
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:
‫ﻫ‬Law on Patents (Cases)
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
Page 16 of 65
to engage the service of counsel, thereby incurring attorney's fees and and from aiding and abetting or in any way contributing to the
expenses of litigation in the sum of P5,000.00. 2 infringement of said patent;

On April 14, 1962, an order granting the plaintiff's petition for a Writ of 3. Ordering that each and all of the infringing tiles, engravings,
Preliminary Injunction was issued. 3 castings and devices, which are in the possession or under the control
of defendants be delivered to plaintiff;
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 4. Ordering the defendants to jointly and severally pay to the plaintiff
the original first nor sole inventor of the improvements in the process of the following sums of money, to wit:
making mosaic pre-cast tiles, the same having been used by several tile-
making factories in the Philippines and abroad years before the alleged (a) P10,020.99 by way of actual damages;
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 (b) P50,000.00 by way of moral damages;
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 (c) P5,000.00 by way of exemplary damages;
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 (d) P5,000.00 by way of attorney's fees and
registration was unlawfully secured and was a result of the gross
misrepresentation on the part of the plaintiff that his alleged invention is a (e) costs of suit. 5
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 The defendant Domiciano Aguas appealed to the Court of Appeals, assigning
conclusion of the plaintiff, the truth being that a) the invention of plaintiff is the following errors. 6
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,
I
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 ERRED IN NOT HOLDING THAT PLAINTIFF'S
PATENT FOR THE 'PROCESS OF MAKING MOSAIC PRE-CAST
TILE' IS INVALID BECAUSE SAID ALLEGED PROCESS IS NOT AN
The trial court rendered a decision dated December 29, 1965, the dispositive
INVENTION OR DISCOVERY AS THE SAME HAS ALREADY LONG
portion of which reads:
BEEN USED BY TILE MANUFACTURERS BOTH ABROAD AND IN
THIS COUNTRY.
WHEREFORE, judgment is hereby rendered in favor of plaintiff and
against the defendants:
II
1. Declaring plaintiff's patent valid and infringed:
THE TRIAL COURT ERRED IN HOLDING THAT THE PATENT OF
PLAINTIFF IS VALID BECAUSE IT IS AN IMPROVEMENT OR THE
2. Granting a perpetual injunction restraining defendants, their officers, AGE-OLD TILE MAKING SYSTEM.
agents, employees, associates, confederates, and any and all persons
acting under their authority from making and/or using and/or vending
III
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 THE TRIAL COURT ERRED IN NOT ORDERING THE
intended for use in apparatus for the making of tiles embodying CANCELLATION OF PLAINTIFF-APPELLEE'S LETTERS PATENT
plaintiff's patented invention, and from offering or advertising so to do,

‫ﻫ‬Law on Patents (Cases) Page 17 of 65

 NO. 658, EXHIBIT L, IN ACCORDANCE WITH THE PERTINENT
PROVISIONS OF THE PATENT LAW, REPUBLIC ACT 165.
IV
THE TRIAL COURT ERRED IN HOLDING THAT DEFENDANT
DOMICIANO A. AGUAS IS GUILTY OF INFRINGEMENT DESPITE
THE FACT THAT PLAINTIFF'S PATENT IS NOT A VALID ONE.
V
The facts, as found by the Court of Appeals, are:
THE TRIAL COURT ERRED IN NOT HOLDING THAT THE
DEFENDANT COULD NEVER BE GUILTY OF INFRINGEMENT OF
PLAINTIFF'S PATENT BECAUSE EVEN IN MATTERS NOT
PATENTED BY THE PLAINTIFF - LIKE THE COMPOSITION AND
PROPORTION OF INGREDIENTS USED AND THE STRUCTURAL
DESIGNS OF THE MOULD AND THE TILE PRODUCED - THAT OF
THE DEFENDANT ARE DIFFERENT.
VI
THE TRIAL COURT ERRED IN NOT DISMISSING THE COMPLAINT
AND IN HOLDING THE DEFENDANT, INSTEAD OF THE PLAINTIFF,
LIABLE FOR DAMAGES, AND ATTORNEY'S FEES.
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
The petitioner assigns the following errors supposedly committed by the
Court of Appeals:
It is now respectfully submitted that the Court of Appeals committed
the following errors involving questions of law, to wit:
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 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;
Second error. — When it did not conclude from the admitted facts of
the case, particularly the contents of the letters patent, Exh. L and the
pieces of physical evidence introduced consisting of samples of the
‫ﻫ‬Law on Patents (Cases)
tiles and catalouges, that the alleged improvements introduced by the
respondent in the manufacture of mosaic pre-cast tiles are not
patentable, the same being not new, useful and inventive.
Third error. — As a corollary, when it sentenced the herein petitioner to
pay the 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 the amount of P50,000.00
moral damages was reduced to P3,000.00. 8
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
Page 18 of 65
 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
‫ﻫ‬Law on Patents (Cases)
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
Page 19 of 65
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
‫ﻫ‬Law on Patents (Cases)
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
Page 20 of 65
 infringed is entitled to damages which, according to the circumstances SO ORDERED.
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.

‫ﻫ‬Law on Patents (Cases) Page 21 of 65

[6] 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.
Patents; 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.—The element of novelty
is an essential requisite of the patentability of an invention or discovery. If a
device or process has been known or used by others prior to its invention or
discovery by the applicant, an application for a patent therefor should be
denied; and if the application has been granted, the court, in a judicial
proceeding in which the validity of the patent is drawn in question, will hold
it void and ineffective. It has been repeatedly held that an invention must
possess the essential elements of novelty, originality and precedence, and for
the patentee to be entitled to the protection the invention must be new to the
world.
Same; Evidence; Burden of Proof; 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.—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. 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.
Same; Same; Philippine Patent Office; There is a presumption that the
Philippine Patent Office has correctly determined the patentability of the
model and such action must not be interfered with in the absence of
competent evidence to the contrary.—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
‫ﻫ‬Law on Patents (Cases)
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 model and such
action must not be interfered with in the absence of competent evidence to
the contrary.
Same; Same; Same; Administrative Law; The findings of fact of the
Director of Patents, especially when affirmed by the Court of Appeals, are
conclusive on the Supreme Court when supported by substantial evidence.—
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.
Same; Same; 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, it may be held insufficient.—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.
Evidence; Questions of Fact; Words and Phrases; There is a 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.—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. 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
Page 22 of 65
and relevance of specific surrounding circumstances, their relation to each
other and to the whole and the probabilities of the situation.
Same; Supreme Court; 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.—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.
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
‫ﻫ‬Law on Patents (Cases)
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
Page 23 of 65
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
‫ﻫ‬Law on Patents (Cases)
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
Page 24 of 65
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
‫ﻫ‬Law on Patents (Cases)
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.
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
Page 25 of 65
 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.
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.
‫ﻫ‬Law on Patents (Cases)
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.
Page 26 of 65
‫ﻫ‬Law on Patents (Cases) Page 27 of 65
[7] G.R. No. 148222               August 15, 2003
PEARL & DEAN (PHIL.), INCORPORATED, Petitioner,
vs. SHOEMART, INCORPORATED, and NORTH EDSA MARKETING,
INCORPORATED, Respondents.
Intellectual Property; Copyrights; Patents; Being a mere statutory
grant, the rights are limited to what the statute confers; It can cover only the
works falling within the statutory enumeration or description.—Copyright, in
the strict sense of the term, is purely a statutory right. Being a mere statutory
grant, the rights are limited to what the statute confers. It may be obtained
and enjoyed only with respect to the subjects and by the persons, and on
terms and conditions specified in the statute. Accordingly, it can cover only
the works falling within the statutory enumeration or description.
Same; Same; Same; The three legal rights are completely distinct and
separate from one another and the protection afforded by one cannot be used
interchangeably to cover items or works that exclusively pertain to the
others.—During the trial, the president of P & D himself admitted that the
light box was neither a literary not an artistic work but an “engineering or
marketing invention.” Obviously, there appeared to be some confusion
regarding what ought or ought not to be the proper subjects of copyrights,
patents and trademarks. In the leading case of Kho vs. Court of Appeals, we
ruled that these three legal rights are completely distinct and separate from
one another, and the protection afforded by one cannot be used
interchangeably to cover items or works that exclusively pertain to the others.
Same; Same; Same; 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.—For some reason or
another, petitioner never secured a patent for the light boxes. It therefore
acquired no patent rights which could have protected its invention, if in fact it
really was. And because it had no patent, petitioner could not legally prevent
anyone from manufacturing or commercially using the contraption. In Creser
Precision Systems, Inc. vs. Court of Appeals, we held that “there can be no
infringement of a patent until a patent has been issued, since whatever right
one has to the invention covered by the patent arises alone from the grant of
patent. x x x (A)n inventor has no common law right to a monopoly of his
invention. He has the right to make use of and vend his invention, but if he
voluntarily discloses it, such as by offering it for sale, the world is free to
copy and use it with impunity. A patent, however, gives the inventor the right
‫ﻫ‬Law on Patents (Cases)
to exclude all others. As a patentee, he has the exclusive right of making,
selling or using the invention.
Same; Same; Same; To be able to effectively and legally preclude
others from copying and profiting from the invention, a patent is a
primordial requirement.—To be able to effectively and legally preclude
others from copying and profiting from the invention, a patent is a primordial
requirement. No patent, no protection. The ultimate goal of a patent system is
to bring new designs and technologies into the public domain through
disclosure. Ideas, once disclosed to the public without the protection of a
valid patent, are subject to appropriation without significant restraint.
Same; Same; Same; Patent law has a three-fold purpose.—The patent
law has a three-fold purpose: “first, patent law seeks to foster and reward
invention; second, it promotes disclosures of inventions to stimulate further
innovation and to permit the public to practice the invention once the patent
expires; third, the stringent requirements for patent protection seek to ensure
that ideas in the public domain remain there for the free use of the public.”
Same; Same; Same; One who has adopted and used a trademark on
his goods does not prevent the adoption and use of the same trademark by
others for products which are of a different description.—Under the
circumstances, the Court of Appeals correctly cited Faberge Inc. vs.
Intermediate Appellate Court, where we, invoking Section 20 of the old
Trademark Law, ruled that “the certificate of registration issued by the
Director of Patents can confer (upon petitioner) the exclusive right to use its
own symbol only to those goods specified in the certificate, subject to any
conditions and limitations specified in the certificate x x x. One who has
adopted and used a trademark on his goods does not prevent the adoption
and use of the same trademark by others for products which are of a
different description.” Faberge, Inc. was correct and was in fact recently
reiterated in Canon Kabushiki Kaisha vs. Court of Appeals.
Same; Same; Same; Unfair Competition; There can be no unfair
competition under the law on copyrights although it is applicable to disputes
over the use of trademarks.—By the nature of things, there can be no unfair
competition under the law on copyrights although it is applicable to disputes
over the use of trademarks. Even a name or phrase incapable of appropriation
as a trademark or trade name may, by long and exclusive use by a business
(such that the name or phrase becomes associated with the business or
product in the mind of the purchasing public), be entitled to protection
Page 28 of 65
against unfair competition. In this case, there was no evidence that P & D’s
use of “Poster Ads” was distinctive or well-known. As noted by the Court of
Appeals, petitioner’s expert witnesses himself had testified that “Poster Ads”
was too generic a name. So it was difficult to identify it with any company,
honestly speaking.”
DECISION
CORONA, J.:
In the instant petition for review on certiorari under Rule 45 of the Rules of
Court, petitioner Pearl & Dean (Phil.) Inc. (P & D) assails the May 22, 2001
decision1 of the Court of Appeals reversing the October 31, 1996 decision 2 of
the Regional Trial Court of Makati, Branch 133, in Civil Case No. 92-516
which declared private respondents Shoemart Inc. (SMI) and North Edsa
Marketing Inc. (NEMI) liable for infringement of trademark and copyright, and
unfair competition.
FACTUAL ANTECEDENTS
3 
The May 22, 2001 decision of the Court of Appeals contained a summary of
this dispute:
"Plaintiff-appellant Pearl and Dean (Phil.), Inc. is a corporation engaged in
the manufacture of advertising display units simply referred to as light boxes.
These units utilize specially printed posters sandwiched between plastic
sheets and illuminated with back lights. Pearl and Dean was able to secure a
Certificate of Copyright Registration dated January 20, 1981 over these
illuminated display units. The advertising light boxes were marketed under
the trademark "Poster Ads". The application for registration of the trademark
was filed with the Bureau of Patents, Trademarks and Technology Transfer
on June 20, 1983, but was approved only on September 12, 1988, per
Registration No. 41165. From 1981 to about 1988, Pearl and Dean employed
the services of Metro Industrial Services to manufacture its advertising
displays.
Sometime in 1985, Pearl and Dean negotiated with defendant-appellant
Shoemart, Inc. (SMI) for the lease and installation of the light boxes in SM
City North Edsa. Since SM City North Edsa was under construction at that
time, SMI offered as an alternative, SM Makati and SM Cubao, to which
Pearl and Dean agreed. On September 11, 1985, Pearl and Dean’s General
Manager, Rodolfo Vergara, submitted for signature the contracts covering
SM Cubao and SM Makati to SMI’s Advertising Promotions and Publicity
Division Manager, Ramonlito Abano. Only the contract for SM Makati,
however, was returned signed. On October 4, 1985, Vergara wrote Abano
inquiring about the other contract and reminding him that their agreement for
‫ﻫ‬Law on Patents (Cases)
installation of light boxes was not only for its SM Makati branch, but also for
SM Cubao. SMI did not bother to reply.
Instead, in a letter dated January 14, 1986, SMI’s house counsel informed
Pearl and Dean that it was rescinding the contract for SM Makati due to non-
performance of the terms thereof. In his reply dated February 17, 1986,
Vergara protested the unilateral action of SMI, saying it was without basis. In
the same letter, he pushed for the signing of the contract for SM Cubao.
Two years later, Metro Industrial Services, the company formerly contracted
by Pearl and Dean to fabricate its display units, offered to construct light
boxes for Shoemart’s chain of stores. SMI approved the proposal and ten
(10) light boxes were subsequently fabricated by Metro Industrial for SMI.
After its contract with Metro Industrial was terminated, SMI engaged the
services of EYD Rainbow Advertising Corporation to make the light boxes.
Some 300 units were fabricated in 1991. These were delivered on a
staggered basis and installed at SM Megamall and SM City.
Sometime in 1989, Pearl and Dean, received reports that exact copies of its
light boxes were installed at SM City and in the fastfood section of SM
Cubao. Upon investigation, Pearl and Dean found out that aside from the two
(2) reported SM branches, light boxes similar to those it manufactures were
also installed in two (2) other SM stores. It further discovered that defendant-
appellant North Edsa Marketing Inc. (NEMI), through its marketing arm,
Prime Spots Marketing Services, was set up primarily to sell advertising
space in lighted display units located in SMI’s different branches. Pearl and
Dean noted that NEMI is a sister company of SMI.
In the light of its discoveries, Pearl and Dean sent a letter dated December
11, 1991 to both SMI and NEMI enjoining them to cease using the subject
light boxes and to remove the same from SMI’s establishments. It also
demanded the discontinued use of the trademark "Poster Ads," and the
payment to Pearl and Dean of compensatory damages in the amount of
Twenty Million Pesos (P20,000,000.00).
Upon receipt of the demand letter, SMI suspended the leasing of two
hundred twenty-four (224) light boxes and NEMI took down its
advertisements for "Poster Ads" from the lighted display units in SMI’s stores.
Claiming that both SMI and NEMI failed to meet all its demands, Pearl and
Dean filed this instant case for infringement of trademark and copyright,
unfair competition and damages.
In denying the charges hurled against it, SMI maintained that it independently
developed its poster panels using commonly known techniques and available
technology, without notice of or reference to Pearl and Dean’s copyright. SMI
noted that the registration of the mark "Poster Ads" was only for stationeries
Page 29 of 65
such as letterheads, envelopes, and the like. Besides, according to SMI, the
word "Poster Ads" is a generic term which cannot be appropriated as a
trademark, and, as such, registration of such mark is invalid. It also stressed
that Pearl and Dean is not entitled to the reliefs prayed for in its complaint
since its advertising display units contained no copyright notice, in violation of
Section 27 of P.D. 49. SMI alleged that Pearl and Dean had no cause of
action against it and that the suit was purely intended to malign SMI’s good
name. On this basis, SMI, aside from praying for the dismissal of the case,
also counterclaimed for moral, actual and exemplary damages and for the
cancellation of Pearl and Dean’s Certification of Copyright Registration No.
PD-R-2558 dated January 20, 1981 and Certificate of Trademark
Registration No. 4165 dated September 12, 1988.
NEMI, for its part, denied having manufactured, installed or used any
advertising display units, nor having engaged in the business of advertising.
It repleaded SMI’s averments, admissions and denials and prayed for similar
reliefs and counterclaims as SMI."
The RTC of Makati City decided in favor of P & D:
Wherefore, defendants SMI and NEMI are found jointly and severally liable
for infringement of copyright under Section 2 of PD 49, as amended, and
infringement of trademark under Section 22 of RA No. 166, as amended, and
are hereby penalized under Section 28 of PD 49, as amended, and Sections
23 and 24 of RA 166, as amended. Accordingly, defendants are hereby
directed:
(1) to pay plaintiff the following damages:
(a) actual damages - ₱16,600,000.00, representing profits derived by
defendants as a result of infringement of plaintiff’s copyright from 1991 to
1992
(b) moral damages - ₱1,000.000.00
(c) exemplary damages - ₱1,000,000.00
(d) attorney’s fees - ₱1,000,000.00
plus
(e) costs of suit;
(2) to deliver, under oath, for impounding in the National Library, all light
boxes of SMI which were fabricated by Metro Industrial Services and EYD
Rainbow Advertising Corporation;
‫ﻫ‬Law on Patents (Cases)
(3) to deliver, under oath, to the National Library, all filler-posters using the
trademark "Poster Ads", for destruction; and
(4) to permanently refrain from infringing the copyright on plaintiff’s light
boxes and its trademark "Poster Ads".
Defendants’ counterclaims are hereby ordered dismissed for lack of merit.
SO ORDERED.4
On appeal, however, the Court of Appeals reversed the trial court:
Since the light boxes cannot, by any stretch of the imagination, be
considered as either prints, pictorial illustrations, advertising copies, labels,
tags or box wraps, to be properly classified as a copyrightable class "O"
work, we have to agree with SMI when it posited that what was copyrighted
were the technical drawings only, and not the light boxes themselves, thus:
42. When a drawing is technical and depicts a utilitarian object, a copyright
over the drawings like plaintiff-appellant’s will not extend to the actual object.
It has so been held under jurisprudence, of which the leading case is Baker
vs. Selden (101 U.S. 841 (1879). In that case, Selden had obtained a
copyright protection for a book entitled "Selden’s Condensed Ledger or
Bookkeeping Simplified" which purported to explain a new system of
bookkeeping. Included as part of the book were blank forms and illustrations
consisting of ruled lines and headings, specially designed for use in
connection with the system explained in the work. These forms showed the
entire operation of a day or a week or a month on a single page, or on two
pages following each other. The defendant Baker then produced forms which
were similar to the forms illustrated in Selden’s copyrighted books. The Court
held that exclusivity to the actual forms is not extended by a copyright. The
reason was that "to grant a monopoly in the underlying art when no
examination of its novelty has ever been made would be a surprise and a
fraud upon the public; that is the province of letters patent, not of copyright."
And that is precisely the point. No doubt aware that its alleged original design
would never pass the rigorous examination of a patent application, plaintiff-
appellant fought to foist a fraudulent monopoly on the public by conveniently
resorting to a copyright registration which merely employs a recordal system
without the benefit of an in-depth examination of novelty.
The principle in Baker vs. Selden was likewise applied in Muller vs.
Triborough Bridge Authority [43 F. Supp. 298 (S.D.N.Y. 1942)]. In this case,
Muller had obtained a copyright over an unpublished drawing entitled "Bridge
Approach – the drawing showed a novel bridge approach to unsnarl traffic
congestion". The defendant constructed a bridge approach which was
alleged to be an infringement of the new design illustrated in plaintiff’s
Page 30 of 65
drawings. In this case it was held that protection of the drawing does not
extend to the unauthorized duplication of the object drawn because copyright
extends only to the description or expression of the object and not to the
object itself. It does not prevent one from using the drawings to construct the
object portrayed in the drawing.
In two other cases, Imperial Homes Corp. v. Lamont, 458 F. 2d 895
and Scholtz Homes, Inc. v. Maddox, 379 F. 2d 84, it was held that there is no
copyright infringement when one who, without being authorized, uses a
copyrighted architectural plan to construct a structure. This is because the
copyright does not extend to the structures themselves.
In fine, we cannot find SMI liable for infringing Pearl and Dean’s copyright
over the technical drawings of the latter’s advertising display units.
The Supreme Court trenchantly held in Faberge, Incorporated vs.
Intermediate Appellate Court that the protective mantle of the Trademark Law
extends only to the goods used by the first user as specified in the certificate
of registration, following the clear mandate conveyed by Section 20 of
Republic Act 166, as amended, otherwise known as the Trademark Law,
which reads:
SEC. 20. Certification of registration prima facie evidence of validity.- A
certificate of registration of a mark or trade-name shall be prima
facie evidence of the validity of the registration, the registrant’s ownership of
the mark or trade-name, and of the registrant’s exclusive right to use the
same in connection with the goods, business or services specified in the
certificate, subject to any conditions and limitations stated therein."
(underscoring supplied)
The records show that on June 20, 1983, Pearl and Dean applied for the
registration of the trademark "Poster Ads" with the Bureau of Patents,
Trademarks, and Technology Transfer. Said trademark was recorded in the
Principal Register on September 12, 1988 under Registration No. 41165
covering the following products: stationeries such as letterheads, envelopes
and calling cards and newsletters.
With this as factual backdrop, we see no legal basis to the finding of liability
on the part of the defendants-appellants for their use of the words "Poster
Ads", in the advertising display units in suit. Jurisprudence has interpreted
Section 20 of the Trademark Law as "an implicit permission to a
manufacturer to venture into the production of goods and allow that producer
to appropriate the brand name of the senior registrant on goods other than
those stated in the certificate of registration." The Supreme Court further
emphasized the restrictive meaning of Section 20 when it stated, through
Justice Conrado V. Sanchez, that:
‫ﻫ‬Law on Patents (Cases)
Really, if the certificate of registration were to be deemed as including goods
not specified therein, then a situation may arise whereby an applicant may be
tempted to register a trademark on any and all goods which his mind may
conceive even if he had never intended to use the trademark for the said
goods. We believe that such omnibus registration is not contemplated by our
Trademark Law.
While we do not discount the striking similarity between Pearl and Dean’s
registered trademark and defendants-appellants’ "Poster Ads" design, as well
as the parallel use by which said words were used in the parties’ respective
advertising copies, we cannot find defendants-appellants liable for
infringement of trademark. "Poster Ads" was registered by Pearl and Dean
for specific use in its stationeries, in contrast to defendants-appellants who
used the same words in their advertising display units. Why Pearl and Dean
limited the use of its trademark to stationeries is simply beyond us. But,
having already done so, it must stand by the consequence of the registration
which it had caused.
We are constrained to adopt the view of defendants-appellants that the
words "Poster Ads" are a simple contraction of the generic term poster
advertising. In the absence of any convincing proof that "Poster Ads" has
acquired a secondary meaning in this jurisdiction, we find that Pearl and
Dean’s exclusive right to the use of "Poster Ads" is limited to what is written
in its certificate of registration, namely, stationeries.
Defendants-appellants cannot thus be held liable for infringement of the
trademark "Poster Ads".
There being no finding of either copyright or trademark infringement on the
part of SMI and NEMI, the monetary award granted by the lower court to
Pearl and Dean has no leg to stand on.
WHEREFORE, premises considered, the assailed decision is REVERSED
and SET ASIDE, and another is rendered DISMISSING the complaint and
counterclaims in the above-entitled case for lack of merit. 5
Dissatisfied with the above decision, petitioner P & D filed the instant petition
assigning the following errors for the Court’s consideration:
A. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT NO
COPYRIGHT INFRINGEMENT WAS COMMITTED BY RESPONDENTS SM
AND NEMI;
B. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT NO
INFRINGEMENT OF PEARL & DEAN’S TRADEMARK "POSTER ADS"
WAS COMMITTED BY RESPONDENTS SM AND NEMI;
Page 31 of 65
C. THE HONORABLE COURT OF APPEALS ERRED IN DISMISSING THE
AWARD OF THE TRIAL COURT, DESPITE THE LATTER’S FINDING, NOT
DISPUTED BY THE HONORABLE COURT OF APPEALS, THAT SM WAS
GUILTY OF BAD FAITH IN ITS NEGOTIATION OF ADVERTISING
CONTRACTS WITH PEARL & DEAN.
D. THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING
RESPONDENTS SM AND NEMI LIABLE TO PEARL & DEAN FOR
ACTUAL, MORAL & EXEMPLARY DAMAGES, ATTORNEY’S FEES AND
COSTS OF SUIT.6
ISSUES
In resolving this very interesting case, we are challenged once again to put
into proper perspective four main concerns of intellectual property law —
patents, copyrights, trademarks and unfair competition arising from
infringement of any of the first three. We shall focus then on the following
issues:
(1) if the engineering or technical drawings of an advertising display unit (light
box) are granted copyright protection (copyright certificate of registration) by
the National Library, is the light box depicted in such engineering drawings
ipso facto also protected by such copyright?
(2) or should the light box be registered separately and protected by a patent
issued by the Bureau of Patents Trademarks and Technology Transfer (now
Intellectual Property Office) — in addition to the copyright of the engineering
drawings?
(3) can the owner of a registered trademark legally prevent others from using
such trademark if it is a mere abbreviation of a term descriptive of his goods,
services or business?
ON THE ISSUE OF COPYRIGHT INFRINGEMENT
Petitioner P & D’s complaint was that SMI infringed on its copyright over the
light boxes when SMI had the units manufactured by Metro and EYD
Rainbow Advertising for its own account. Obviously, petitioner’s position was
premised on its belief that its copyright over the engineering drawings
extended ipso facto to the light boxes depicted or illustrated in said drawings.
In ruling that there was no copyright infringement, the Court of Appeals held
that the copyright was limited to the drawings alone and not to the light box
itself. We agree with the appellate court.
First, petitioner’s application for a copyright certificate — as well as Copyright
Certificate No. PD-R2588 issued by the National Library on January 20, 1981
‫ﻫ‬Law on Patents (Cases)
— clearly stated that it was for a class "O" work under Section 2 (O) of PD 49
(The Intellectual Property Decree) which was the statute then prevailing. Said
Section 2 expressly enumerated the works subject to copyright:
SEC. 2. The rights granted by this Decree shall, from the moment of creation,
subsist with respect to any of the following works:
(O) Prints, pictorial illustrations, advertising copies, labels, tags, and box
wraps;
Although petitioner’s copyright certificate was entitled "Advertising Display
Units" (which depicted the box-type electrical devices), its claim of copyright
infringement cannot be sustained.
Copyright, in the strict sense of the term, is purely a statutory right. Being a
mere statutory grant, the rights are limited to what the statute confers. It may
be obtained and enjoyed only with respect to the subjects and by the
persons, and on terms and conditions specified in the statute. 7 Accordingly, it
can cover only the works falling within the statutory enumeration or
description.8
P & D secured its copyright under the classification class "O" work. This
being so, petitioner’s copyright protection extended only to the technical
drawings and not to the light box itself because the latter was not at all in the
category of "prints, pictorial illustrations, advertising copies, labels, tags and
box wraps." Stated otherwise, even as we find that P & D indeed owned a
valid copyright, the same could have referred only to the technical drawings
within the category of "pictorial illustrations." It could not have possibly
stretched out to include the underlying light box. The strict application 9 of the
law’s enumeration in Section 2 prevents us from giving petitioner even a little
leeway, that is, even if its copyright certificate was entitled "Advertising
Display Units." What the law does not include, it excludes, and for the good
reason: the light box was not a literary or artistic piece which could be
copyrighted under the copyright law. And no less clearly, neither could the
lack of statutory authority to make the light box copyrightable be remedied by
the simplistic act of entitling the copyright certificate issued by the National
Library as "Advertising Display Units."
In fine, if SMI and NEMI reprinted P & D’s technical drawings for sale to the
public without license from P & D, then no doubt they would have been guilty
of copyright infringement. But this was not the case. SMI’s and NEMI’s acts
complained of by P & D were to have units similar or identical to the light box
illustrated in the technical drawings manufactured by Metro and EYD
Rainbow Advertising, for leasing out to different advertisers. Was this an
infringement of petitioner’s copyright over the technical drawings? We do not
think so.
Page 32 of 65
During the trial, the president of P & D himself admitted that the light box was
neither a literary not an artistic work but an "engineering or marketing
invention."10 Obviously, there appeared to be some confusion regarding what
ought or ought not to be the proper subjects of copyrights, patents and
trademarks. In the leading case of Kho vs. Court of Appeals,11 we ruled that
these three legal rights are completely distinct and separate from one
another, and the protection afforded by one cannot be used interchangeably
to cover items or works that exclusively pertain to the others:
Trademark, copyright and patents are different intellectual property rights that
cannot be interchanged with one another. A trademark is any visible sign
capable of distinguishing the goods (trademark) or services (service mark) of
an enterprise and shall include a stamped or marked container of goods. In
relation thereto, a trade name means the name or designation identifying or
distinguishing an enterprise. Meanwhile, the scope of a copyright is confined
to literary and artistic works which are original intellectual creations in the
literary and artistic domain protected from the moment of their
creation. Patentable inventions, on the other hand, refer to any technical
solution of a problem in any field of human activity which is new, involves an
inventive step and is industrially applicable.
ON THE ISSUE OF PATENT INFRINGEMENT
This brings us to the next point: if, despite its manufacture and commercial
use of the light boxes without license from petitioner, private respondents
cannot be held legally liable for infringement of P & D’s copyright over
its technical drawings of the said light boxes, should they be liable instead for
infringement of patent? We do not think so either.
For some reason or another, petitioner never secured a patent for the light
boxes. It therefore acquired no patent rights which could have protected its
invention, if in fact it really was. And because it had no patent, petitioner
could not legally prevent anyone from manufacturing or commercially using
the contraption. In Creser Precision Systems, Inc. vs. Court of Appeals,12 we
held that "there can be no infringement of a patent until a patent has been
issued, since whatever right one has to the invention covered by the patent
arises alone from the grant of patent. x x x (A)n inventor has no common law
right to a monopoly of his invention. He has the right to make use of and
vend his invention, but if he voluntarily discloses it, such as by 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, selling or using the invention. 13 On the assumption
that petitioner’s advertising units were patentable inventions, petitioner
revealed them fully to the public by submitting the engineering drawings
thereof to the National Library.
‫ﻫ‬Law on Patents (Cases)
To be able to effectively and legally preclude others from copying and
profiting from the invention, a patent is a primordial requirement. No patent,
no protection. The ultimate goal of a patent system is to bring new designs
and technologies into the public domain through disclosure. 14 Ideas, once
disclosed to the public without the protection of a valid patent, are subject to
appropriation without significant restraint.15
On one side of the coin is the public which will benefit from new ideas; on the
other are the inventors who must be protected. As held in Bauer & Cie vs.
O’Donnel,16 "The act secured to the inventor the exclusive right to make use,
and vend the thing patented, and consequently to prevent others from
exercising like privileges without the consent of the patentee. It was passed
for the purpose of encouraging useful invention and promoting new and
useful inventions by the protection and stimulation given to inventive genius,
and was intended to secure to the public, after the lapse of the exclusive
privileges granted the benefit of such inventions and improvements."
The law attempts to strike an ideal balance between the two interests:
"(The p)atent system thus embodies a carefully crafted bargain for
encouraging the creation and disclosure of new useful and non-obvious
advances in technology and design, in return for the exclusive right to
practice the invention for a number of years. The inventor may keep his
invention secret and reap its fruits indefinitely. In consideration of its
disclosure and the consequent benefit to the community, the patent is
granted. An exclusive enjoyment is guaranteed him for 17 years, but upon
the expiration of that period, the knowledge of the invention inures to the
people, who are thus enabled to practice it and profit by its use." 17
The patent law has a three-fold purpose: "first, patent law seeks to foster and
reward invention; second, it promotes disclosures of inventions to stimulate
further innovation and to permit the public to practice the invention once the
patent expires; third, the stringent requirements for patent protection seek to
ensure that ideas in the public domain remain there for the free use of the
public."18
It is only after an exhaustive examination by the patent office that a patent is
issued. Such an in-depth investigation is required because "in rewarding a
useful invention, the rights and welfare of the community must be fairly dealt
with and effectively guarded. To that end, the prerequisites to obtaining a
patent are strictly observed and when a patent is issued, the limitations on its
exercise are equally strictly enforced. To begin with, a genuine invention or
discovery must be demonstrated lest in the constant demand for new
appliances, the heavy hand of tribute be laid on each slight technological
advance in art."19
Page 33 of 65
There is no such scrutiny in the case of copyrights nor any notice published
before its grant to the effect that a person is claiming the creation of a work.
The law confers the copyright from the moment of creation 20 and the
copyright certificate is issued upon registration with the National Library of a
sworn ex-parte claim of creation.
Therefore, not having gone through the arduous examination for patents, the
petitioner cannot exclude others from the manufacture, sale or commercial
use of the light boxes on the sole basis of its copyright certificate over the
technical drawings.
Stated otherwise, what petitioner seeks is exclusivity without any opportunity
for the patent office (IPO) to scrutinize the light box’s eligibility as a
patentable invention. The irony here is that, had petitioner secured a patent
instead, its exclusivity would have been for 17 years only. But through the
simplified procedure of copyright-registration with the National Library —
without undergoing the rigor of defending the patentability of its invention
before the IPO and the public — the petitioner would be protected for 50
years. This situation could not have been the intention of the law.
In the oft-cited case of Baker vs. Selden 21 , the United States Supreme Court
held that only the expression of an idea is protected by copyright, not the
idea itself. In that case, the plaintiff held the copyright of a book which
expounded on a new accounting system he had developed. The publication
illustrated blank forms of ledgers utilized in such a system. The defendant
reproduced forms similar to those illustrated in the plaintiff’s copyrighted
book. The US Supreme Court ruled that:
"There is no doubt that a work on the subject of book-keeping, though only
explanatory of well known systems, may be the subject of a copyright; but,
then, it is claimed only as a book. x x x. But there is a clear distinction
between the books, as such, and the art, which it is, intended to illustrate.
The mere statement of the proposition is so evident that it requires hardly any
argument to support it. The same distinction may be predicated of every
other art as well as that of bookkeeping. A treatise on the composition and
use of medicines, be they old or new; on the construction and use of ploughs
or watches or churns; or on the mixture and application of colors for painting
or dyeing; or on the mode of drawing lines to produce the effect of
perspective, would be the subject of copyright; but no one would contend that
the copyright of the treatise would give the exclusive right to the art or
manufacture described therein. The copyright of the book, if not pirated from
other works, would be valid without regard to the novelty or want of novelty of
its subject matter. The novelty of the art or thing described or explained has
nothing to do with the validity of the copyright. To give to the author of the
book an exclusive property in the art described therein, when no
examination of its novelty has ever been officially made, would be
‫ﻫ‬Law on Patents (Cases)
a surprise and a fraud upon the public. That is the province of letters
patent, not of copyright. The claim to an invention of discovery of an art
or manufacture must be subjected to the examination of the Patent
Office before an exclusive right therein can be obtained; and a patent
from the government can only secure it.
The difference between the two things, letters patent and copyright, may be
illustrated by reference to the subjects just enumerated. Take the case of
medicines. Certain mixtures are found to be of great value in the healing
art. If the discoverer writes and publishes a book on the subject (as
regular physicians generally do), he gains no exclusive right to the
manufacture and sale of the medicine; he gives that to the public. If he
desires to acquire such exclusive right, he must obtain a patent for the
mixture as a new art, manufacture or composition of matter. He may
copyright his book, if he pleases; but that only secures to him the
exclusive right of printing and publishing his book. So of all other
inventions or discoveries.
The copyright of a book on perspective, no matter how many drawings and
illustrations it may contain, gives no exclusive right to the modes of drawing
described, though they may never have been known or used before. By
publishing the book without getting a patent for the art, the latter is given to
the public.
Now, whilst no one has a right to print or publish his book, or any material
part thereof, as a book intended to convey instruction in the art, any person
may practice and use the art itself which he has described and illustrated
therein. The use of the art is a totally different thing from a publication
of the book explaining it. The copyright of a book on bookkeeping cannot
secure the exclusive right to make, sell and use account books prepared
upon the plan set forth in such book. Whether the art might or might not have
been patented, is a question, which is not before us. It was not patented, and
is open and free to the use of the public. And, of course, in using the art, the
ruled lines and headings of accounts must necessarily be used as incident to
it.
The plausibility of the claim put forward by the complainant in this case arises
from a confusion of ideas produced by the peculiar nature of the art
described in the books, which have been made the subject of copyright. In
describing the art, the illustrations and diagrams employed happened to
correspond more closely than usual with the actual work performed by the
operator who uses the art. x x x The description of the art in a book,
though entitled to the benefit of copyright, lays no foundation for an
exclusive claim to the art itself. The object of the one is explanation; the
object of the other is use. The former may be secured by copyright. The
Page 34 of 65
latter can only be secured, if it can be secured at all, by letters
patent." (underscoring supplied)
ON THE ISSUE OF TRADEMARK INFRINGEMENT
This issue concerns the use by respondents of the mark "Poster Ads" which
petitioner’s president said was a contraction of "poster advertising." P & D
was able to secure a trademark certificate for it, but one where the goods
specified were "stationeries such as letterheads, envelopes, calling cards
and newsletters."22 Petitioner admitted it did not commercially engage in or
market these goods. On the contrary, it dealt in electrically operated backlit
advertising units and the sale of advertising spaces thereon, which, however,
were not at all specified in the trademark certificate.
Under the circumstances, the Court of Appeals correctly cited Faberge Inc.
vs. Intermediate Appellate Court,23 where we, invoking Section 20 of the old
Trademark Law, ruled that "the certificate of registration issued by the
Director of Patents can confer (upon petitioner) the exclusive right to use its
own symbol only to those goods specified in the certificate, subject to any
conditions and limitations specified in the certificate x x x. One who has
adopted and used a trademark on his goods does not prevent the adoption
and use of the same trademark by others for products which are of a
different description."24 Faberge, Inc. was correct and was in fact recently
reiterated in Canon Kabushiki Kaisha vs. Court of Appeals.25
Assuming arguendo that "Poster Ads" could validly qualify as a trademark,
the failure of P & D to secure a trademark registration for specific use on the
light boxes meant that there could not have been any trademark infringement
since registration was an essential element thereof.1âwphi1
ON THE ISSUE OF UNFAIR COMPETITION
If at all, the cause of action should have been for unfair competition, a
situation which was possible even if P & D had no registration. 26 However,
while the petitioner’s complaint in the RTC also cited unfair competition, the
trial court did not find private respondents liable therefor. Petitioner
did not appeal this particular point; hence, it cannot now revive its claim of
unfair competition.
But even disregarding procedural issues, we nevertheless cannot hold
respondents guilty of unfair competition.
By the nature of things, there can be no unfair competition under the law on
copyrights although it is applicable to disputes over the use of trademarks.
Even a name or phrase incapable of appropriation as a trademark or
tradename may, by long and exclusive use by a business (such that the
‫ﻫ‬Law on Patents (Cases)
name or phrase becomes associated with the business or product in the
mind of the purchasing public), be entitled to protection against unfair
competition.27 In this case, there was no evidence that P & D’s use of "Poster
Ads" was distinctive or well-known. As noted by the Court of Appeals,
petitioner’s expert witnesses himself had testified that " ‘Poster Ads’ was too
generic a name. So it was difficult to identify it with any company, honestly
speaking."28 This crucial admission by its own expert witness that "Poster
Ads" could not be associated with P & D showed that, in the mind of the
public, the goods and services carrying the trademark "Poster Ads" could not
be distinguished from the goods and services of other entities.
This fact also prevented the application of the doctrine of secondary
meaning. "Poster Ads" was generic and incapable of being used as a
trademark because it was used in the field of poster advertising, the very
business engaged in by petitioner. "Secondary meaning" means that a word
or phrase originally incapable of exclusive appropriation with reference to an
article in the market (because it is geographically or otherwise descriptive)
might nevertheless have been used for so long and so exclusively by one
producer with reference to his article that, in the trade and to that branch of
the purchasing public, the word or phrase has come to mean that the article
was his property.29 The admission by petitioner’s own expert witness that he
himself could not associate "Poster Ads" with petitioner P & D because it was
"too generic" definitely precluded the application of this exception.
Having discussed the most important and critical issues, we see no need to
belabor the rest.
All told, the Court finds no reversible error committed by the Court of Appeals
when it reversed the Regional Trial Court of Makati City.
WHEREFORE, the petition is hereby DENIED and the decision of the Court
of Appeals dated May 22, 2001 is AFFIRMED in toto.
SO ORDERED.
Page 35 of 65
[8] G.R. No. 167715               November 17, 2010
PHIL PHARMAWEALTH, INC., Petitioner, vs. PFIZER, INC. and PFIZER
(PHIL.) INC., Respondents.
Intellectual Property; Patents; 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.—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.
Remedial Law; Injunction; Requisites to Warrant the Issuance of an
Injunctive Relief.—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.
Same; Certiorari; Appeals; What is being questioned before the Court of
Appeals (CA) is a not a decision, but an interlocutory order of the Bureau of
Legal Affairs of the Intellectual Property Office (BLA-IPO) denying
respondents’ motion to extend the life of the preliminary injunction issued in
their favor.—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.
Same; Same; Same; Republic Act (RA) 8293 is silent with respect to
any remedy available to litigants who intend to question an interlocutory
‫ﻫ‬Law on Patents (Cases)
order issued by the Bureau of Legal Affairs of the Intellectual Property
Office (BLA-IPO); Respondents correctly resorted to the filing of a special
civil action for certiorari with the Court of Appeals (CA) to question the
assailed Orders of the Bureau of Legal Affairs of the Intellectual Property
Office (BLA-IPO) as they cannot appeal therefrom and they have no other
plain, speedy and adequate remedy in the ordinary course of law.—RA 8293
is silent with respect to any remedy available to litigants who intend to
question an interlocutory order issued by the BLA-IPO. Moreover, Section
1(c), Rule 14 of the Rules and Regulations on Administrative Complaints for
Violation of Laws Involving Intellectual Property Rights simply provides
that interlocutory orders shall not be appealable. The said Rules and
Regulations do not prescribe a procedure within the administrative
machinery to be followed in assailing orders issued by the BLA-IPO pending
final resolution of a case filed with them. Hence, in the absence of such a
remedy, the provisions of the Rules of Court shall apply in a suppletory
manner, as provided under Section 3, Rule 1 of the same Rules and
Regulations. Hence, in the present case, respondents correctly resorted to the
filing of a special civil action for certiorari with the CA to question the
assailed Orders of the BLA-IPO, as they cannot appeal therefrom and they
have no other plain, speedy and adequate remedy in the ordinary course of
law. This is consistent with Sections 1 and 4, Rule 65 of the Rules of Court,
as amended.
Same; Courts; Doctrine of Primary Jurisdiction; 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.—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. This is the case with
respect to the issue raised in the petition filed with the CA.
Same; Actions; Forum Shopping; Definition of Forum Shopping;
Elements of Forum Shopping.—Forum shopping is defined as the act of a
party against whom an adverse judgment has been rendered in one forum, of
Page 36 of 65
seeking another (and possibly favorable) opinion in another forum (other
than by appeal or the special civil action of certiorari), or the institution of
two (2) or more actions or proceedings grounded on the same cause on the
supposition that one or the other court would make a favorable disposition.
The elements of forum shopping are: (a) identity of parties, or at least such
parties that represent the same interests in both actions; (b) identity of rights
asserted and reliefs prayed for, the reliefs being founded on the same facts;
(c) identity of the two preceding particulars, such that any judgment rendered
in the other action will, regardless of which party is successful, amount to res
judicata in the action under consideration.
Same; Same; Same; It is settled by the Court in several cases that the
filing by a party of two apparently different actions but with the same
objective constitutes forum shopping.—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. 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.
Same; Same; Same; 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; If the forum shopping is
willful and deliberate, both (on all, if there are more than two) actions shall
be dismissed with prejudice.—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. However, if the forum shopping is willful and deliberate, both (or
all, if there are more than two) actions shall be dismissed with prejudice. 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,
‫ﻫ‬Law on Patents (Cases)
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.
DECISION
PERALTA, J.:
Before the Court is a petition for review on certiorari seeking to annul and set
aside the Resolutions dated January 18, 2005 1 and April 11, 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:
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.
Page 37 of 65
 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
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.
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 Injunction 6 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
‫ﻫ‬Law on Patents (Cases)
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.
On August 24, 2004, the RTC of Makati City issued an Order 10 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 Dismiss 12 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 Resolution 13 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 order 14 which prohibited
petitioner "from importing, distributing, selling or offering for sale Sulbactam
Ampicillin products to any hospital or to any other entity in the Philippines, or
from infringing Pfizer Inc.'s Philippine Patent No. 21116 and impounding all
the sales invoices and other documents evidencing sales by [petitioner] of
Sulbactam Ampicillin products."
On February 7, 2005, petitioner again filed a Motion to Dismiss 15 the case for
being moot and academic, contending that respondents' patent had already
lapsed. In the same manner, petitioner also moved for the reconsideration of
the temporary restraining order issued by the CA on the same basis that the
patent right sought to be protected has been extinguished due to the lapse of
the patent license and on the ground that the CA has no jurisdiction to review
the order of the BLA-IPO as said jurisdiction is vested by law in the Office of
the Director General of the IPO.
Page 38 of 65
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:
Section 37. Rights of patentees.  A patentee shall have the exclusive right
to make, use and sell the patented machine, article or product, and to use the
patented process for the purpose of industry or commerce, throughout the
territory of the Philippines for the 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
‫ﻫ‬Law on Patents (Cases)
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
Page 39 of 65
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:
‫ﻫ‬Law on Patents (Cases)
[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
Page 40 of 65
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
‫ﻫ‬Law on Patents (Cases)
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
Page 41 of 65
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
‫ﻫ‬Law on Patents (Cases)
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;
Page 42 of 65
 (2) ordering Pharmawealth to pay plaintiffs the following finds that respondents did not deliberately violate the rule on non-forum
amounts: shopping. Respondents may not be totally blamed for erroneously believing
that they can file separate actions simply on the basis of different patents.
(i) at least ₱3,000,000.00 as actual damages; 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
(ii) ₱500,000.00 as attorney's fees and
these bases, only Civil Case No. 04-754 should be dismissed on the ground
₱1,000,000.00 as litigation expenses;
of litis pendentia.
(iii) ₱3,000,000.00 as exemplary damages; and
WHEREFORE, the petition is PARTLY GRANTED. The assailed Resolutions
of the Court of Appeals, dated January 18, 2005 and April 11, 2005, in CA-
(iv) costs of this suit. 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.
(3) ordering the condemnation, seizure or forfeiture of Pharmawealth's
infringing goods or products, wherever they may be found, including Civil Case No. 04-754, filed with the Regional Trial Court of Makati City,
the materials and implements used in the commission of infringement, Branch 138, is likewise DISMISSED on the ground of litis pendentia.
to be disposed of in such manner as may be deemed appropriate by
this Honorable Court; and
SO ORDERED.
33
(4) making the injunction permanent.

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

‫ﻫ‬Law on Patents (Cases) Page 43 of 65

[9] 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.
Civil Law; Universally Accessible Cheaper and Quality Medicines Act
of 2008 (Republic Act No. 9502); Section 7 of Republic 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.
—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.
Same; Same; The unqualified right of private third parties such as petitioner
to import or possess “unregistered imported drugs” in the Philippines
further confirmed by the Implementing Rules to Republic Act No. 9502.—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.
Same; Same; Statutory Construction; Where a statute of later date,
such as Republic 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; 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.—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.
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. Irreconcilable inconsistency between
‫ﻫ‬Law on Patents (Cases)
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. Legis posteriors priores contrarias abrogant.
Same; Same; Same; For a law that is intended to help save lives, the
Special Law on Counterfeit Drugs (SLCD) has revealed itself as a heartless,
soulless legislative piece.—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.
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 warrant 1 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
Page 44 of 65
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
‫ﻫ‬Law on Patents (Cases)
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;
Page 45 of 65
 "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.
‫ﻫ‬Law on Patents (Cases)
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
Page 46 of 65
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.

‫ﻫ‬Law on Patents (Cases) Page 47 of 65

[11] G.R. No. L-27793             March 15, 1928
PATRICK HENRY FRANK and WILLIAM HENRY GOHN, plaintiff-
appellees, vs. CONSTANCIO BENITO, defendant-appellant.
1.WHAT IS "PRIMA FACIE" EVIDENCE AND WHEN BURDEN OF
PROOF SHIFTS.—In a case which involved the infringement of a. patent
issued to the plaintiff by the United States Patent Office, which was duly
registered in the Bureau of Commerce and Industry of the Philippine Islands,
and which was introduced in evidence by the plaintiff and is in due form, the
patent is prima facie evidence of its correctness and validity, and the burden
then shifts to the defendant to overcome this legal presumption.
2.WHEN IMPROVER is AN INFRINGER.—It is well established that an
improver cannot appropriate the basic patent of another, and that the
improver without license is an infringer and may be sued as such.
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.
‫ﻫ‬Law on Patents (Cases)
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.
Page 48 of 65
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:
‫ﻫ‬Law on Patents (Cases)
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
Page 49 of 65
 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.

‫ﻫ‬Law on Patents (Cases) Page 50 of 65

[12] G.R. No. L-4720             January 19, 1909
CARLOS GSELL, plaintiff-appellee, vs.VALERIANO VELOSO YAP-
JUE, defendant-appellant.
1.INFRINGEMENT OF PATENTS; PROCESS OF MANUFACTURE.—
The manufacture of cane handles for walking sticks and umbrellas by a
process identical with plaintiff's patented process therefor, save only for the
substitution of a blast lamp or blowpipe fed by alcohol, for a blast lamp or
blowpipe fed by petroleum or mineral fuel, in applying heat for the purpose
of curving such handles, is an infringement upon the patented process.
2.ID.; ID., INJUNCTION; CONTEMPT.—The use of a process in all
respects identical with a process protected by a valid patent, save only that a
well-known mechanical equivalent is substituted in lieu of some particular
part of the patented process, is an infringement upon the rights of the owner
of the patent, which will be enjoined in appropriate proceeding, and the use
of such process, after the order enjoining its use has been issued, is a
"contempt," under the provisions of section 172 of the Code of Civil
Procedure.
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:
‫ﻫ‬Law on Patents (Cases)
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.
Page 51 of 65
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
‫ﻫ‬Law on Patents (Cases)
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
Page 52 of 65
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
‫ﻫ‬Law on Patents (Cases)
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.)
Page 53 of 65
 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.)
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.

All the elements of the invention in this case are old, and the rule in
such cases, as before explained, undoubtedly is that a purpose can
not invoke the doctrine of equivalents to suppress all other
improvements of the old machine, but he is entitled to treat everyone
as an infringer who makes, uses, or vends his patented improvement
without any other change than the employment of a substitute for
one of its elements, well known as such at the date of his invention,
and which any constructor acquainted with the art will know how to
comply. The reason for the qualification of the rule as stated is, that
such change — that is, the mere substitution of a well- known
element for another — where it appears that the substituted element
was well known as a usual substitute for the element left out — is
merely a formal one, and nothing better than a colorable evasion of
the patent. (Union Sugar Refining Co. vs. Matthieson, Fed. Cas.,
14399.)

Counsel for the defendant insists that, under Spanish law, none of the steps
of the process described in the descriptive statement, save those mentioned
in the "note" thereto attached are included in the patent, and that the patent
rights secured thereunder are strictly limited to the precise language of the
"note" attached to the descriptive statement; while counsel for plaintiff
appears to think that the language of the patent covers any process or device
whereby wood or cane may be bent or curved by the use of heat. But for the
purpose of this decision it is not necessary to consider these questions,
further than to hold, as we do, that under the doctrine of equivalents, the
language of the note in the descriptive statement applies to the operation of
applying heat for the purpose of curving handles or canes and umbrellas by
means of a blast lamp fed with alcohol, as well as by means of a blast lamp
fed with petroleum or mineral oil; and the defendant having admitted the fact
that he applied heat for the purpose of curving handles for canes and
umbrellas by means of a blast lamp fed with alcohol, he must be deemed to
have contempt of violating the terms and the injunction issued in the principal
case, wherein plaintiff was declared the owner of the patent in question, and
defendant enjoined from its infringement.

The argument of counsel for defendant and appellant, based on the theory
that the questions herein discussed and decided to have been heretofore
settled by this court, and that the subject-matter of this proceeding is  res
adjudicata  between the parties thereto is sufficiently refuted by the simple

‫ﻫ‬Law on Patents (Cases) Page 54 of 65

[13] 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.
Patents; Jurisdiction; Injunction; A regular court (RTC) has
jurisdiction to determine the issue of novelty or prior use when a patent is
sought to be enforced, for the purpose of deciding whether or not to issue a
writ of preliminary injunction.—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 x x x 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).
Same; Evidence; The burden of proof to substantiate a charge of
patent infringement lies with the plaintiff. Once the patent is in evidence, the
burden of evidence is upon the defendant to overcome this presumption.—
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.
Same; Words and Phrases; When an invention is novel or original,
explained.—lt has been repeatedly held that an invention must possess the
essential elements of novelty, originality and precedence and for the patentee
‫ﻫ‬Law on Patents (Cases)
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.
Same; Injunction; In actions for patent infringement a writ of
injunction will not issue unless the validity of the patent in relation to the
issue of novelty and originality of the alleged invention, is clear and beyond
question. If a fair case of invalidity, after preliminary hearing is presented,
injunction must not issue.—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 proof s 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." All these notwithstanding the trial court nonetheless issued the
writ of preliminary injunction which under the circumstances should be
denied. 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 existence of the
right to be protected and the violation of said right. (Buayan Cattle Co., Inc.
v. Quintillan, 128 SCRA 276).
Appeal; Certiorari; Certiorari may be availed of where appeal though
available, is inadequate, as in wrongful issuance of preliminary injunction.—
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 power 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 [1978] where
the First Division of the Supreme Court ruled that "The prerogative writ of
certiorari may be applied for by proper petition notwithstanding the existence
of the regular remedy of an appeal in due cause when among other reasons,
the broader interests of justice so require or an ordinary appeal is not an
adequate remedy.
Page 55 of 65

Same; Same; Actions; Judges; Judges are mere nominal parties.—
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).
Patents; Actions; Prescription; Claim of prescription may be availed
of by patent holder in petitions for cancellation at the Patent Office, but not
in ordinary civil actions for infringement of patent.—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.
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)
‫ﻫ‬Law on Patents (Cases)
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 infringement of said patents and therefore its
immediate discontinuance is demanded, otherwise it will be compelled to
take judicial action. (Rollo, pp. 7-8).
Private respondent replied stating that her products are 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:
Page 56 of 65
 (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).
‫ﻫ‬Law on Patents (Cases)
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
Page 57 of 65
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 by the grounds embodied in the motion for reconsideration filed by herein
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
‫ﻫ‬Law on Patents (Cases)
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
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
Page 58 of 65
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).
‫ﻫ‬Law on Patents (Cases)
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.
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).
Page 59 of 65
All these notwithstanding, the trial court nonetheless issued the writ of
preliminary injunction which under the circumstances should be denied.
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 existence of the right to be
protected and the violation of said right. (Buayan Cattle Co., Inc. v. Quintillan,
128 SCRA 276).
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.

Under the above established principles, it appears obvious that the trial court SO ORDERED.
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 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).

‫ﻫ‬Law on Patents (Cases) Page 60 of 65

[14] G. R. No. 126627               August 14, 2003
SMITH KLINE BECKMAN CORPORATION, Petitioner, vs. THE
HONORABLE COURT OF APPEALS and TRYCO PHARMA
CORPORATION, Respondents.
Intellectual Property Law; Appeals; Only questions of law may be
raised in a petition for review on certiorari.—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,
this Court does not review them.
Same; Patents; When the language of its claims is clear and distinct,
the patentee is bound thereby and may not claim anything beyond them.
— When the language of its claims is clear and distinct, the patentee is bound
thereby and may not claim anything beyond them. 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.
Same; Same; Infringement; Doctrine of Equivalents; Definition.—
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.
Same; Same; Same; Same; The Doctrine of Equivalents thus requires
satisfaction of the function-means-and-result test.—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.
Damages; Actual Damages; Unearned Profits; It is necessary to prove
the actual amount of damages with a reasonable degree of certainty based
on competent proof.—While indemnification for actual or compensatory
damages covers not only the loss suffered (damnum emergens) but also
‫ﻫ‬Law on Patents (Cases)
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.
Same; Attorney’s Fees; Attorney’s fees cannot be awarded where there
is no sufficient showing of bad faith.—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.
DECISION
CARPIO-MORALES, J.:
Smith Kline Beckman Corporation (petitioner), a corporation existing by virtue
of the laws of the state of Pennsylvania, United States of America (U.S.) and
licensed to do business in the Philippines, filed on October 8, 1976, as
assignee, before the Philippine Patent Office (now Bureau of Patents,
Trademarks and Technology Transfer) an application for patent over an
invention entitled "Methods and Compositions for Producing Biphasic
Parasiticide Activity Using Methyl 5 Propylthio-2-Benzimidazole Carbamate."
The application bore Serial No. 18989.
On September 24, 1981, Letters Patent No. 14561 1 for the aforesaid
invention was issued to petitioner for a term of seventeen (17) years.
The letters patent provides in its claims 2 that the patented invention consisted
of a new compound named methyl 5 propylthio-2-benzimidazole carbamate
and the methods or compositions utilizing the compound as an active
ingredient in fighting infections caused by gastrointestinal parasites and
lungworms in animals such as swine, sheep, cattle, goats, horses, and even
pet animals.
Tryco Pharma Corporation (private respondent) is a domestic corporation
that manufactures, distributes and sells veterinary products including
Impregon, a drug that has Albendazole for its active ingredient and is claimed
to be effective against gastro-intestinal roundworms, lungworms, tapeworms
and fluke infestation in carabaos, cattle and goats.
Page 61 of 65
Petitioner sued private respondent for infringement of patent and unfair
competition before the Caloocan City Regional Trial Court (RTC). 3 It claimed
that its patent covers or includes the substance Albendazole such that private
respondent, by manufacturing, selling, using, and causing to be sold and
used the drug Impregon without its authorization, infringed Claims 2, 3, 4, 7,
8 and 9 of Letters Patent No. 14561 4 as well as committed unfair competition
under Article 189, paragraph 1 of the Revised Penal Code and Section 29 of
Republic Act No. 166 (The Trademark Law) for advertising and selling as its
own the drug Impregon although the same contained 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.
‫ﻫ‬Law on Patents (Cases)
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.
Page 62 of 65
SO ORDERED.
Petitioner’s motion for reconsideration of the Court of Appeals’ decision
having been denied11 the present petition for review on certiorari 12 was filed,
assigning as errors the following:
I. THE COURT OF APPEALS GRAVELY ERRED IN NOT FINDING
THAT ALBENDAZOLE, THE ACTIVE INGREDIENT IN 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
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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
Page 63 of 65
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
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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
Page 64 of 65
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.

‫ﻫ‬Law on Patents (Cases) Page 65 of 65