FIRST DIVISION

[G.R. No. 113388. September 5, 1997]

ANGELITA MANZANO, Petitioner, v. COURT OF APPEALS, and MELECIA

MADOLARIA, as Assignor to NEW UNITED FOUNDRY
MANUFACTURING CORPORATION, Respondents.

DECISION

BELLOSILLO, J.:

The primary purpose of the patent system is not the reward of the individual
but the advancement of the arts and sciences. The function of a patent is to
add to the sum of useful knowledge and one of the purposes of the patent
system is to encourage dissemination of information concerning discoveries
and inventions. This is a matter which is properly within the competence of the
Patent Office the official action of which has the presumption of correctness
and may not be interfered with in the absence of new evidence carrying
thorough conviction that the Office has erred. Since the Patent Office is an
expert body preeminently qualified to determine questions of patentability, its
findings must be accepted if they are consistent with the evidence, with
doubts as to patentability resolved in favor of the Patent Office.1

Petitioner Angelita Manzano filed with the Philippine Patent Office on 19

February 1982 an action for the cancellation of Letters Patent No. UM-4609
for a gas burner registered in the name of respondent Melecia Madolaria who
subsequently assigned the letters patent to New United Foundry and
Manufacturing Corporation (UNITED FOUNDRY, for brevity). Petitioner
alleged that (a) the utility model covered by the letters patent, in this case, an
LPG gas burner, was not inventive, new or useful; (b) the specification of the
letters patent did not comply with the requirements of Sec. 14, RA No. 165, as
amended; (c) respondent Melecia Madolaria was not the original, true and
actual inventor nor did she derive her rights from the original, true and actual
inventor of the utility model covered by the letters patent; and, (d) the letters
patent was secured by means of fraud or misrepresentation. In support of her
petition for cancellation petitioner further alleged that (a) the utility model
covered by the letters patent of respondent had been known or used by
others in the Philippines for more than one (1) year before she filed her
application for letters patent on 9 December 1979; (b) the products which
were produced in accordance with the utility model covered by the letters
patent had been in public use or on sale in the Philippines for more than one
(1) year before the application for patent therefor was filed.

Petitioner presented the following documents which she correspondingly

marked as exhibits: (a) affidavit of petitioner alleging the existence of prior art,
marked Exh. A; (b) a brochure distributed by Manila Gas Corporation
disclosing a pictorial representation of Ransome Burner made by Ransome
Torch and Burner Company, USA, marked Exh. D; and, (c) a brochure
distributed by Esso Gasul or Esso Standard Eastern, Inc., of the Philippines
showing a picture of another similar burner with top elevation view and
another perspective view of the same burner, marked Exh. E.

Testifying for herself petitioner narrated that her husband Ong Bun Tua
worked as a helper in the UNITED FOUNDRY where respondent Melecia
Madolaria used to be affiliated with from 1965 to 1970; that Ong helped in the
casting of an LPG burner which was the same utility model of a burner for
which Letters Patent No. UM-4609 was issued, and that after her husbands
separation from the shop she organized Besco Metal Manufacturing (BESCO
METAL, for brevity) for the casting of LPG burners one of which had the
configuration, form and component parts similar to those being manufactured
by UNITED FOUNDRY. Petitioner presented in evidence an alleged model of
an LPG burner marked Exh. K and covered by the Letters Patent of
respondent, and testified that it was given to her in January 1982 by one of
her customers who allegedly acquired it from UNITED FOUNDRY. Petitioner
also presented in evidence her own model of an LPG burner called Ransome
burner marked Exh. L, which was allegedly manufactured in 1974 or 1975 and
sold by her in the course of her business operation in the name of BESCO
METAL. Petitioner claimed that this Ransome burner (Exh. L) had the same
configuration and mechanism as that of the model which was patented in
favor of private respondent Melecia Madolaria. Also presented by petitioner
was a burner cup of an imported Ransome burner marked Exh M which was
allegedly existing even before the patent application of private respondent.

Petitioner presented two (2) other witnesses, namely, her husband Ong Bun
Tua and Fidel Francisco. Ong testified that he worked as a helper in the
UNITED FOUNDRY from 1965 to 1970 where he helped in the casting of LPG
burners with the same form, configuration and mechanism as that of the
model covered by the Letters Patent issued to private respondent. Francisco
testified that he had been employed with the Manila Gas Corporation from
1930 to 1941 and from 1952 up to 1969 where he retired as supervisor and
that Manila Gas Corporation imported Ransome burners way back in 1965
which were advertised through brochures to promote their sale.

Private respondent, on the other hand, presented only one witness, Rolando
Madolaria, who testified, among others, that he was the General Supervisor of
the UNITED FOUNDRY in the foundry, machine and buffing section; that in
his early years with the company, UNITED FOUNDRY was engaged in the
manufacture of different kinds of gas stoves as well as burners based on
sketches and specifications furnished by customers; that the company
manufactured early models of single-piece types of burners where the mouth
and throat were not detachable; that in the latter part of 1978 respondent
Melecia Madolaria confided in him that complaints were being brought to her
attention concerning the early models being manufactured; that he was then
instructed by private respondent to cast several experimental models based
on revised sketches and specifications; that private respondent again made
some innovations; that after a few months, private respondent discovered the
solution to all the defects of the earlier models and, based on her latest
sketches and specifications, he was able to cast several models incorporating
the additions to the innovations introduced in the models. Various tests were
conducted on the latest model in the presence and under the supervision of
Melecia Madolaria and they obtained perfect results. Rolando Madolaria
testified that private respondent decided to file her application for utility model
patent in December 1979.

On 7 July 1986 the Director of Patents Cesar C. Sandiego issued Decision

No. 86-56 denying the petition for cancellation and holding that the evidence
of petitioner was not able to establish convincingly that the patented utility
model of private respondent was anticipated. Not one of the various pictorial
representations of business clearly and convincingly showed that the devices
presented by petitioner was identical or substantially identical with the utility
model of the respondent. The decision also stated that even assuming that
the brochures depicted clearly each and every element of the patented gas
burner device so that the prior art and patented device became identical
although in truth they were not, they could not serve as anticipatory bars for
the reason that they were undated. The dates when they were distributed to
the public were not indicated and, therefore, were useless prior art references.
The records and evidence also do not support the petitioners contention that
Letters Patent No. UM-4609 was obtained by means of fraud and/or
misrepresentation. No evidence whatsoever was presented by petitioner to
show that the then applicant Melecia Madolaria withheld with intent to deceive
material facts which, if disclosed, would have resulted in the refusal by the
Philippine Patent Office to issue the Letters Patent under inquiry.

Petitioner elevated the decision of the Director of Patents to the Court of

Appeals which on 15 October 1993 affirmed the decision of the Director of
Patents. Hence, this petition for review on certiorari alleging that the Court of
Appeals erred (a) in relying on imaginary differences which in actuality did not
exist between the model of private respondent covered by Letters Patent No.
UM-4609 and the previously known model of Esso Standard Eastern, Inc.,
and Manila Gas Corporation, making such imaginary differences grounded
entirely on speculation, surmises and conjectures; (b) in rendering judgment
based on misapprehension of facts; (c) in relying mainly on the testimony of
private respondents sole witness Rolando Madolaria; and, (d) in not canceling
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 respondents model of
the gas burner.
Petitioner argues that the actual demonstration made during the hearing
disclosed the similarities in form, operation and mechanism and parts
between the utility model of private respondent and those depicted in the
brochures. The findings of the Patent Office and the Court of Appeals that the
brochures of Manila Gas Corporation and Esso Standard Eastern, Inc., are
undated cannot overcome the fact of their circulation before private
respondent filed her application for utility model patent. Petitioner thus asks
this Court to take judicial notice of the fact that Esso Standard Eastern, Inc.,
disappeared before 1979 and reappeared only during the Martial Law years
as Petrophil Corporation. Petitioner also emphasizes that the brochures
indicated the telephone number of Manila Gas Corporation as 5-79-81 which
is a five (5) numbered telephone number existing before 1975 because
telephones in Metro Manila started to have six (6) numbers only after that
year.

Petitioner further contends that the utility model of private respondent is

absolutely similar to the LPG burner being sold by petitioner in 1975 and
1976, and also to the Ransome burner depicted in the old brochures of Manila
Gas Corporation and Esso Standard Eastern, Inc., fabricated by Ransome
Torch and Burner Company of Oakland, California, USA, especially when
considered through actual physical examination, assembly and disassembly
of the models of petitioner and private respondent. Petitioner faults the Court
of Appeals for disregarding the testimonies of Ong Bun Tua and Fidel
Francisco for their failure to produce documents on the alleged importation by
Manila Gas Corporation of Ransome burners in 1965 which had the same
configuration, form and mechanism as that of the private respondents
patented model.

Finally, it is argued that the testimony of private respondents 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. Inventions patentable. Any invention of a new and useful machine,

manufactured product or substance, process or an improvement of any of the
foregoing, shall be patentable.

Further, Sec. 55 of the same law provides -

Sec. 55. Design patents and patents for utility models. - (a) Any new, original
and ornamental design for an article of manufacture and (b) any new model of
implements or tools or of any industrial product or of part of the same, which
does not possess the quality of invention, but which is of practical utility by
reason of its form, configuration, construction or composition, may be
protected by the author thereof, the former by a patent for a design and the
latter by a patent for a utility model, in the same manner and subject to the
same provisions and requirements as relate to patents for inventions insofar
as they are applicable except as otherwise herein provided.

The element of novelty is an essential requisite of the patentability of an

invention or discovery. If a device or process has been known or used by
others prior to its invention or discovery by the applicant, an application for a
patent therefor should be denied; and if the application has been granted, the
court, in a judicial proceeding in which the validity of the patent is drawn in
question, will hold it void and ineffective.2 It has been repeatedly held that an
invention must possess the essential elements of novelty, originality and
precedence, and for the patentee to be entitled to the protection the invention
must be new to the world.3

In issuing Letters Patent No. UM-4609 to Melecia Madolaria for an LPG

Burner on 22 July 1981, the Philippine Patent Office found her invention novel
and patentable. The issuance of such patent creates a presumption which
yields only to clear and cogent evidence that the patentee was the original
and first inventor. The burden of proving want of novelty is on him who avers it
and the burden is a heavy one which is met only by clear and satisfactory
proof which overcomes every reasonable doubt.4 Hence, a utility model shall
not be considered new if before the application for a patent it has been
publicly known or publicly used in this country or has been described in a
printed publication or publications circulated within the country, or if it is
substantially similar to any other utility model so known, used or described
within the country.5

As found by the Director of Patents, the standard of evidence sufficient to

overcome the presumption of legality of the issuance of UM-4609 to
respondent Madolaria was not legally met by petitioner in her action for the
cancellation of the patent. Thus the Director of Patents explained his reasons
for the denial of the petition to cancel private respondents patent -

Scrutiny of Exhs. D and E readily reveals that the utility model (LPG Burner) is
not anticipated. Not one of the various pictorial representations of burners
clearly and convincingly show that the device presented therein is identical or
substantially identical in construction with the aforesaid utility model. It is
relevant and material to state that in determining whether novelty or newness
is negatived by any prior art, only one item of the prior art may be used at a
time. For anticipation to occur, the prior art must show that each element is
found either expressly or described or under principles of inherency in a single
prior art reference or that the claimed invention was probably known in a
single prior art device or practice. (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.
xxxx

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

xxxx

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
Petitioners 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.

xxxx

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 respondents model of gas burner as a
discovery. There is a presumption that the Office has correctly determined the
patentability of the model8 and such action must not be interfered with in the
absence of competent evidence to the contrary.

The rule is settled that the findings of fact of the Director of Patents, especially
when affirmed by the Court of Appeals, are conclusive on this Court when
supported by substantial evidence. Petitioner has failed to show compelling
grounds for a reversal of the findings and conclusions of the Patent Office and
the Court of Appeals.

The alleged failure of the Director of Patents and the Court of Appeals to
accord evidentiary weight to the testimonies of the witnesses of petitioner
showing anticipation is not a justification to grant the petition. Pursuant to the
requirement of clear and convincing evidence to overthrow the presumption of
validity of a patent, it has been held that oral testimony to show anticipation is
open to suspicion and if uncorroborated by cogent evidence, as what
occurred in this case, it may be held insufficient.9

Finally, petitioner would want this Court to review all over again the evidence
she presented before the Patent Office. She argues that contrary to the
decision of the Patent Office and the Court of Appeals, the evidence she
presented clearly proves that the patented model of private respondent is no
longer new and, therefore, fraud attended the acquisition of patent by private
respondent.

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

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

WHEREFORE, the Petition is DENIED. The Decision of the Court of Appeals

affirming that of the Philippine Patent Office is AFFIRMED. Costs against
petitioner.
SO ORDERED.

G.R. L-45101 November 28, 1986

ROSARIO C. MAGUAN (formerly ROSARIO C. TAN), petitioner,

vs.
THE HONORABLE COURT OF APPEALS and SUSANA
LUCHAN, respondents.

Ambrosio Padilla Law Offices for petitioner.

PARAS, J.:p

Submitted on December 9, 1977 for Our decision is this petition for

review on certiorari of the two Resolutions of the Court of Appeals, the
first dated July 6, 1976, setting aside its Decision of February 16, 1976 in
CA-G.R. No. SP-04706, titled "SUSANA LUCHAN v. Hon. HONRADO, et
al." wherein it ruled for the dismissal of the petition for lack of merit and
at the same time nullifying the writ of preliminary injunction it had
previously issued; and the second, dated November 4, 1976, denying the
motion for reconsideration of the first resolution above-mentioned.

Petitioner is doing business under the firm name and style of SWAN
MANUFACTURING" while private respondent is likewise doing business
under the firm name and style of "SUSANA LUCHAN POWDER PUFF
MANUFACTURING."

It is undisputed that petitioner is a patent holder of powder puff namely:

1. UM-423 (extended and/or renewed under Extension No. UM-109 for a

period of 5 years from October 6, 1971)

2. UM-450 (extended and/or renewed under Extension No. UM110 for a

period of 5 years from January 26, 1972)

3. UM 1184, for a period of 5years fromApril 5, 1974.(Petition, Rollo, pp.

6-7).

In a letter dated July 10, 1974 (Annex "D", Rollo, p. 86), petitioner
informed private respondent that the powder puffs the latter is
manufacturing and selling to various enterprises particularly those in
the cosmetics industry, resemble Identical or substantially Identical
powder puffs of which the former is a patent holder under Registration
Certification Nos. Extension UM-109, Extension UM-110 and Utility
Model No. 1184; petitioner explained such production and sale
constitute 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:

(1) at the time of filing of application for the patents involved, the utility
models applied for were not new and patentable under Sec. 55 of R.A.
165, as amended by R.A. 864; and

(2) the person to whom the patents were issued was not the true and
actual author of the utility models applied for, and neither did she derive
her rights from any true and actual author of these utility models.

for the following reasons:

(a) since years prior to the filing of applications for the patents involved,
powder puffs of the kind applied for were then already existing and
publicly being sold in the market; both in the Philippines and abroad;
and

(b) applicant's claims in her applications, of "construction" or process

of manufacturing the utility models applied for, with respect to UM-423
and UM-450, were but a complicated and impractical version of an old,
simple one which has been well known to the cosmetics industry since
years previous to her filing of applications, and which belonged to no
one except to the general public; and with respect to UM1184; her claim
in her application of a unitary powder puff, was but an limitation of a
product well known to the cosmetics industry since years previous to
her firing of application, and which belonged to no one except to the
general public; (Answer, Rollo, pp. 93-94).

On September 18, 1974, the trial court issued an Order (Annex "K",
Rollo, p. 125) granting the preliminary injunction prayed for by
petitioner. Consequently, the corresponding writ was subsequently
issued (Annex "K-1", Rollo, p. 131) enjoining the herein private
respondent (then defendant) and all other persons employed by her, her
agents, servants and employees from directly or indirectly
manufacturing, making or causing to be made, selling or causing to be
sold, or using or causing to be used in accordance with, or embodying
the utility models of the Philippine Patent Office Utility Model Letters
Patent Nos. 423 (Extension No. UM-109), No. 450 (Extension No. UM-
110), and Utility Model No. 1184 or from infringement upon or violating
said letters patent in any way whatsoever (Annex " K-1 ", Rollo, p. 131).

Private respondent questioned the propriety of the trial court's issuance

of the Writ of Preliminary Injunction arguing that since there is still a
pending cancellation proceedings before the Philippine Patent Office
concerning petitioner's patents, such cannot be the basis for
preliminary injunction (Motion for Reconsideration, Rollo, p. 132).

In an Order dated September 11, 1975, the trial court denied private
respondent's motion for reconsideration (Annex "N", Rollo, p. 142).

In challenging these Orders private respondent filed a petition for

certiorari with the respondent court on September 29, 1975 (Annex "D",
Rollo, pp. 148-171) reiterating among other things the invalidity of
petitioner's patents and prayed that the trial court be restrained from
enforcing or continuing to enforce the following:

(1) Order dated September 18, 1974, granting the preliminary injunction;

(2) Writ of preliminary injunction dated September 18, 1974; and

(3) Order dated September 11, 1974 denying petitioner's motion petition
for reconsideration.

On October 15, 1975, the Writ of Preliminary Injunction was issued by

the respondent Court of Appeals as follows:

NOW, THEREFORE, you, respondents, and/or any person/persons

acting on your stead, are hereby ENJOINED to RESTRAIN from
enforcing or continuing to enforce, the proceedings complained of in
the petition to wit: 1) Order dated September 18, 1974, granting the
preliminary injunction; 2) Writ of Preliminary Injunction dated September
18, 1974; and Order dated September 11, 1975, denying petitioner's
motion for reconsideration, all issued in connection with Civil Case No.
19908, UNTIL FURTHER ORDERS FROM THIS COURT. (Annex "P",
Rollo, p. 1.73)

On February 16, 1976, respondent court promulgated a decision the

dispositive portion of which reads:

WHEREFORE, finding no merit in the herein petition, the same is hereby

dismissed and the preliminary injunction previously issued by this
Court is hereby set aside, with costs.

SO ORDERED. (CA Decision, Rollo, p. 189).

ln said decision respondent court stated that in disposing of the petition

it tackled only the issue of whether the court a quo acted with grave
abuse of discretion in issuing the challenged orders. It made clear the
question of whether the patents have been infringed or not was not
determined considering the court a quo has yet to decide the case on
the merits (Ibid., p. 186).

Feeling aggrieved, private respondent moved to reconsider the afore-

mentioned Decision based on the following grounds:

THAT THIS HONORABLE COURT ERRED IN NOT APPRECIATING THE

EXISTENCE OF A FAIR QUESTION OF INVALIDITY OF PRIVATE
RESPONDENT'S PATENTS.

II

THAT THIS HONORABLE COURT ERRED IN NOT REJECTING THE

THEORY OF RESPONDENT JUDGE THAT HE HAS NO JURISDICTION TO
INVALIDATE THE PATENTS UPON GROUND OF LACK OF NOVELTY OF
THE PRODUCTS PATENTED. (Motion for Reconsideration, Rollo, p. 190).

Reviewing on reconsideration, respondent court gave weight to private

respondent's allegation that the latter's products are not identical or
even only substantially identical to the products covered by petitioner's
patents. Said court noticed that contrary to the lower courts position
that the court a quo had no jurisdiction to determine the question of
invalidity of the patents, Section 45 and 46 of the Patent Law allow the
court to make a finding on the validity or invalidity of patents and in the
event there exists a fair question of its invalidity, the situation calls for a
denial of the writ of preliminary injunction pending the evaluation of the
evidence presented (Rollo, pp. 218-226). Thus, finding the lower court's
position to have been opposed to Patent Law, respondent court
considered it a grave abuse of discretion when the court a quo issued
the writ being questioned without looking into the defenses alleged by
herein private respondent. Further, it considered the remedy of appeal,
under the circumstances, to be inadequate.
Thus, on July 6, 1976, respondent court made a complete turnabout
from its original decision and promulgated a Resolution, the dispositive
portion of which reads:

WHEREFORE, our decision is hereby set aside. The writ of certiorari is

ordered issued. Accordingly, the challenged orders, Exhibit H and H-1
and the order denying the motion for reconsideration (Annex "K",
Petition), are hereby set aside. The writ of preliminary injunction
previously ordered by this Court and ordered lifted by the Decision now
being set aside is hereby reinstated and made permanent. Without
pronouncement as to costs.

SO ORDERED. (CA Resolution, Rollo, p. 226).

In a Resolution dated November 4, 1976, respondent court, not

persuaded by the grounds embodied in the motion for reconsideration
filed by herein petitioner (Annex "V ", Rollo, p. 227), denied the same for
lack of merit, thereby maintaining the same stand it took in its July 6,
1976 Resolution (Rollo, p. 281). Hence, this petition.

On December 3, 1976, without giving due course to the petition, this

Court required respondent to file her Comment (Rollo, p. 290) which was
filed on December 16, 1976 (Rollo, pp. 291-316). Thereafter, petitioner
filed her Reply (Rollo, p. 323) and on May 30, 1977, the petition was
given due course (Rollo, p. 345). Petitioner filed her brief on July 14,
1977 (Rollo, p. 351) while private respondent filed her brief on August
25, 1977 (Rollo, p. 359). Thereafter, petitioner having failed to file reply
brief, the Court resolved to declare the case submitted for decision on
December 9, 1977 (Rollo, p. 359).

The assignment of errors raised by the petitioner in this case (Rollo, pp.
15-16) may be reduced to three main issues:

(1) Whether or not in an action for infringement the Court a quo had

jurisdiction to determine the invalidity of the patents at issue which
invalidity was still pending consideration in the patent office.

(2) Whether or not the Court a quo committed grave abuse of discretion

in the issuance of a writ of preliminary injunction.

(3) Whether or not certiorari is the proper remedy.

The first issue has been laid to rest in a number of cases where the
Court ruled that "When a patent is sought to be enforced, the questions
of invention, novelty or prior use, and each of them, are open to judicial
examination." (Vargas v. F.M. Yaptico & Co. 40 Phil. 199 [1919]; Vargas
v. Chua, 57 Phil. 790-791 [1933]; Frank and Gohn v. Kosuyana 59 Phil.
207 [1933]).
Under the present Patent Law, there is even less reason to doubt that
the trial court has jurisdiction to declare the patents in question invalid.
A patentee shall have the exclusive right to make, use and sell the
patented article or product and the making, using, or selling by any
person without the authorization of the patentee constitutes
infringement of the patent (Sec. 37, R.A. 165). Any patentee whose rights
have been infringed upon may bring an action before the proper CFI
now (RTC) and to secure an injunction for the protection of his rights
(Sec. 42, R.A. 165). Defenses in an action for infringement are provided
for in Section 45 of the same law which in fact were availed of by private
respondent in this case. Then, as correctly stated by respondent Court
of Appeals, this conclusion is reinforced by Sec. 46 of the same law
which provides that if the Court shall find the patent or any claim thereof
invalid, the Director shall on certification of the final judgment ... issue
an order cancelling the patent or the claims found invalid and shall
publish a notice thereof in the Official Gazette." Upon such certification,
it is ministerial on the part of the patent office to execute the judgment.
(Rollo, pp. 221-222).

II.

The burden of proof to substantiate a charge of infringement is with the

plaintiff. But where the plaintiff introduces the patent in evidence, and
the same is in due form, there is created a prima facie presumption of its
correctness and validity. The decision of the Commissioner (now
Director) of Patent in granting the patent is presumed to be correct. The
burden of going forward with the evidence (burden of evidence) then
shifts to the defendant to overcome by competent evidence this legal
presumption.

The question then in the instant case is whether or not the evidence
introduced by private respondent herein is sufficient to overcome said
presumption.

After a careful review of the evidence consisting of 64 exhibits and oral

testimonies of five witnesses presented by private respondents before
the Court of First Instance before the Order of preliminary injunction
was issued as well as those presented by the petitioner, respondent
Court of Appeals was satisfied that there is a prima facie showing of a
fair question of invalidity of petitioner's patents on the ground of lack of
novelty. As pointed out by said appellate court said evidence appeared
not to have been considered at all by the court a quo for alleged lack of
jurisdiction, on the mistaken notion that such question in within the
exclusive jurisdiction of the patent office.

It has been repeatedly held that an invention must possess the essential
elements of novelty , originality and precedence and for the patentee to
be entitled to protection, the invention must be new to the world.
Accordingly, a single instance of public use of the invention by a
patentee for more than two years (now for more than one year only
under Sec. 9 of the Patent Law) before the date of his application for his
patent, will be fatal to, the validity of the patent when issued. (Frank, et
al. v. Kosuyama Vargas v. F.M. Yaptico & Co. and Vargas v. Chua, et
al., supra).

The law provides:

SEC. 9. Invention not considered new or patentable. — An invention

shall not be considered new or capable of being patented if it was
known or used by others in the Philippines before the invention thereof
by the inventor named in an application for patent for the invention; or if
it was patented or described in any printed publication in the Philippines
or any foreign country more than one year before the application for a
patent therefor; or if it had been in public use or on sale in the
Philippines for more than one year before the application for a patent
therefor; or if it is the subject matter of a validity issued patent in the
Philippines granted on an application filed before the filing of the
application for patent therefor.

Thus, more specifically, under American Law from which our Patent Law
was derived (Vargas v. F.M. Yaptico & Co. supra) it is generally held that
in patent cases a preliminary injunction will not issue for patent
infringement unless the validity of the patent is clear and beyond
question. The issuance of letters patent, standing alone, is not sufficient
to support such drastic relief (8 Deller's Walker on Patents p. 406). In
cases of infringement of patent no preliminary injunction will be granted
unless the patent is valid and infringed beyond question and the record
conclusively proves the defense is sham. (Ibid., p. 402)

In the same manner, under our jurisprudence, as a general rule because

of the injurious consequences a writ of injunction may bring, the right to
the relief demanded must be clear and unmistakable. (Sangki v.
Comelec, 21 SCRA 1392; December 26, 1967) and the dissolution of the
writ is proper where applicant has doubtful title to the disputed property.
(Ramos v. C.A., 95 SCRA 359).

III.

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).
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).

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

As found by respondent Court of Appeals, the injunctive order of the

trial court is of so general a tenor that petitioner may be totally barred
from the sale of any kind of powder puff. Under the circumstances,
respondent appellate court is of the view that ordinary appeal is
obviously inadequate. (Rollo, p. 288). A parallel was drawn from a
decision of the Supreme Court in the case of Sanchez v. Hon. Court of
Appeals, 69 SCRA 328 [1976] where the First Division of the Supreme
Court ruled that "The prerogative writ of certiorari may be applied for by
proper petition 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).
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.

SO ORDERED.

G.R. No. 97343 September 13, 1993

PASCUAL GODINES, petitioner,
vs.
THE HONORABLE COURT OF APPEALS, SPECIAL FOURTH DIVISION
and SV-AGRO ENTERPRISES, INC., respondents.

Jesus S. Anonat for petitioner.

Arturo M. Alinio for private respondent.

ROMERO, J.:

Through this petition for review in certiorari of a decision of the Court of

Appeals affirming the decision of the trial court, petitioner Pascual Godines
seeks to reverse the adverse decision of the Court a quo that he was liable for
infringement of patent and unfair competition. The dispositive portion of the
assailed decision is hereby quoted to wit:

WHEREFORE, with the elimination of the award for attorney's fees, the
judgment appealed from is hereby AFFIRMED, with costs against appellant.1

The patent involved in this case is Letters Patent No. UM-2236 issued by the
Philippine Patent Office to one Magdalena S. Villaruz on July 15, 1976. It
covers a utility model for a hand tractor or power tiller, the main components
of which are the following: "(1) a vacuumatic house float; (2) a harrow with
adjustable operating handle; (3) a pair of paddy wheels; (4) a protective water
covering for the engine main drive; (5) a transmission case; (6) an operating
handle; (7) an engine foundation on the top midportion of the vacuumatic
housing float to which the main engine drive is detachedly installed; (8) a
frontal frame extension above the quarter — circularly shaped water covering
hold (sic) in place the transmission case; (9) a V-belt connection to the engine
main drive with transmission gear through the pulley, and (10) an idler pulley
installed on the engine foundation."2 The patented hand tractor works in the
following manner: "the engine drives the transmission gear thru the V-belt, a
driven pulley and a transmission shaft. The engine drives the transmission
gear by tensioning of the V-belt which is controlled by the idler pulley. The V-
belt drives the pulley attached to the transmission gear which in turn drives
the shaft where the paddy wheels are attached. The operator handles the
hand tractor through a handle which is inclined upwardly and supported by a
pair of substanding pipes and reinforced by a U-shaped G.I. pipe at the V-
shaped end."3

The above mentioned patent was acquired by SV-Agro Industries Enterprises,

Inc., herein private respondent, from Magdalena Villaruz, its chairman and
president, by virtue of a Deed of Assignment executed by the latter in its
favor. On October 31, 1979, SV-Agro Industries caused the publication of the
patent in Bulletin Today, a newspaper of general circulation.

In accordance with the patent, private respondent manufactured and sold the
patented power tillers with the patent imprinted on them. In 1979, SV-Agro
Industries suffered a decline of more than 50% in sales in its Molave,
Zamboanga del Sur branch. Upon investigation, it discovered that power
tillers similar to those patented by private respondent were being
manufactured and sold by petitioner herein. Consequently, private respondent
notified Pascual Godines about the existing patent and demanded that the
latter stop selling and manufacturing similar power tillers. Upon petitioner's
failure to comply with the demand, SV-Agro Industries filed before the
Regional Trial Court a complaint for infringement of patent and unfair
competition.

After trial, the court held Pascual Godines liable for infringement of patent and
unfair competition. The dispositive portion of the decision reads as follows:

WHEREFORE, premises considered, JUDGMENT is hereby rendered in favor

of the plaintiff SV-Agro Industries Enterprises, Inc., and against defendant
Pascual Godines:

1. Declaring the writ of preliminary injunction issued by this Court against

defendant as permanent;

2. Ordering defendant Pascual Godines to pay plaintiff the sum of Fifty

Thousand Pesos (P50,000.00) as damages to its business reputation and
goodwill, plus the further sum of Eighty Thousand Pesos (P80,000.00) for
unrealized profits during the period defendant was manufacturing and selling
copied or imitation floating power tiller;

3. Ordering the defendant to pay the plaintiff, the further sum of Eight
Thousand Pesos (P8,000.00) as reimbursement of attorney's fees and other
expenses of litigation; and to pay the costs of the suit.

SO ORDERED.4

The decision was affirmed by the appellate court.

Thereafter, this petition was filed. Petitioner maintains the defenses which he
raised before the trial and appellate courts, to wit: that he was not engaged in
the manufacture and sale of the power tillers as he made them only upon the
special order of his customers who gave their own specifications; hence, he
could not be liable for infringement of patent and unfair competition; and that
those made by him were different from those being manufactured and sold by
private respondent.

We find no merit in his arguments. The question of whether petitioner was

manufacturing and selling power tillers is a question of fact better addressed
to the lower courts. In dismissing the first argument of petitioner herein, the
Court of Appeals quoted the findings of the court, to wit:

It is the contention of defendant that he did not manufacture or make

imitations or copies of plaintiff's turtle power tiller as what he merely did was to
fabricate his floating power tiller upon specifications and designs of those who
ordered them. However, this contention appears untenable in the light of the
following circumstances: 1) he admits in his Answer that he has been
manufacturing power tillers or hand tractors, selling and distributing them long
before plaintiff started selling its turtle power tiller in Zamboanga del Sur and
Misamis Occidental, meaning that defendant is principally a manufacturer of
power tillers, not upon specification and design of buyers, but upon his own
specification and design; 2) it would be unbelievable that defendant would
fabricate power tillers similar to the turtle power tillers of plaintiff upon
specifications of buyers without requiring a job order where the specification
and designs of those ordered are specified. No document was (sic) ever been
presented showing such job orders, and it is rather unusual for defendant to
manufacture something without the specification and designs, considering
that he is an engineer by profession and proprietor of the Ozamis Engineering
shop. On the other hand, it is also highly unusual for buyers to order the
fabrication of a power tiller or hand tractor and allow defendant to
manufacture them merely based on their verbal instructions. This is contrary
to the usual business and manufacturing practice. This is not only time
consuming, but costly because it involves a trial and error method, repeat jobs
and material wastage. Defendant judicially admitted two (2) units of the turtle
power tiller sold by him to Policarpio Berondo.5

Of general acceptance is the rule imbedded in our jurisprudence that ". . . the
jurisdiction of the Supreme Court in cases brought to it from the Court of
Appeals in a petition for certiorari under Rule 45 of the Rules of Court is
limited to the review of errors of law, and that said appellate court's findings of
fact are conclusive upon this Court."6

The fact that petitioner herein manufactured and sold power tillers without
patentee's authority has been established by the courts despite petitioner's
claims to the contrary.

The question now arises: Did petitioner's product infringe upon the patent of
private respondent?

Tests have been established to determine infringement. These are (a) literal
infringement; and (b) the doctrine of equivalents. 7 In using literal infringement
as a test, ". . . resort must be had, in the first instance, to the words of the
claim. If accused matter clearly falls within the claim, infringement is made out
and that is the end of it."8 To determine whether the particular item falls within
the literal meaning of the patent claims, the court must juxtapose the claims of
the patent and the accused product within the overall context of the claims
and specifications, to determine whether there is exact identity of all material
elements.9

The trial court made the following observation:

Samples of the defendant's floating power tiller have been produced and
inspected by the court and compared with that of the turtle power tiller of the
plaintiff (see Exhibits H to H-28). In appearance and form, both the floating
power tillers of the defendant and the turtle power tiller of the plaintiff are
virtually the same. Defendant admitted to the Court that two (2) of the power
inspected on March 12, 1984, were manufactured and sold by him (see TSN,
March 12, 1984, p. 7). The three power tillers were placed alongside with
each other. At the center was the turtle power tiller of plaintiff, and on both
sides thereof were the floating power tillers of defendant (Exhibits H to H-2).
Witness Rodrigo took photographs of the same power tillers (front, side, top
and back views for purposes of comparison (see Exhibits H-4 to H-28).
Viewed from any perspective or angle, the power tiller of the defendant is
identical and similar to that of the turtle power tiller of plaintiff in form,
configuration, design and appearance. The parts or components thereof are
virtually the same. Both have the circularly-shaped vacuumatic housing float,
a paddy in front, a protective water covering, a transmission box housing the
transmission gears, a handle which is V-shaped and inclined upwardly,
attached to the side of the vacuumatic housing float and supported by the
upstanding G.I. pipes and an engine base at the top midportion of the
vacuumatic housing float to which the engine drive may be attached. In
operation, the floating power tiller of the defendant operates also in similar
manner as the turtle power tiller of plaintiff. This was admitted by the
defendant himself in court that they are operating on the same principles.
(TSN, August 19, 1987, p. 13) 10

Moreover, it is also observed that petitioner also called his power tiller as a
floating power tiller. The patent issued by the Patent Office referred to a "farm
implement but more particularly to a turtle hand tractor having a vacuumatic
housing float on which the engine drive is held in place, the operating handle,
the harrow housing with its operating handle and the paddy wheel protective
covering." 11 It appears from the foregoing observation of the trial court that
these claims of the patent and the features of the patented utility model were
copied by petitioner. We are compelled to arrive at no other conclusion but
that there was infringement.

Petitioner's argument that his power tillers were different from private
respondent's is that of a drowning man clutching at straws.

Recognizing that the logical fallback position of one in the place of defendant
is to aver that his product is different from the patented one, courts have
adopted the doctrine of equivalents which recognizes that minor modifications
in a patented invention are sufficient to put the item beyond the scope of literal
infringement. 12 Thus, according to this doctrine, "(a)n infringement also
occurs when a device appropriates a prior invention by incorporating its
innovative concept and, albeit with some modification and change, performs
substantially the same function in substantially the same way to achieve
substantially the same result." 13 The reason for the doctrine of equivalents is
that to permit the imitation of a patented invention which does not copy any
literal detail would be to convert the protection of the patent grant into a hollow
and useless thing. Such imitation would leave room for — indeed encourage
— the unscrupulous copyist to make unimportant and insubstantial changes
and substitutions in the patent which, though adding nothing, would be
enough to take the copied matter outside the claim, and hence outside the
reach of the law. 14

In this case, the trial court observed:

Defendant's witness Eduardo Cañete, employed for 11 years as welder of the

Ozamis Engineering, and therefore actually involved in the making of the
floating power tillers of defendant tried to explain the difference between the
floating power tillers made by the defendant. But a careful examination
between the two power tillers will show that they will operate on the same
fundamental principles. And, according to establish jurisprudence, in
infringement of patent, similarities or differences are to be determined, not by
the names of things, but in the light of what elements do, and substantial,
rather than technical, identity in the test. More specifically, it is necessary and
sufficient to constitute equivalency that the same function can be performed in
substantially the same way or manner, or by the same or substantially the
same, principle or mode of operation; but where these tests are satisfied,
mere differences of form or name are immaterial. . . . 15

It also stated:

To establish an infringement, it is not essential to show that the defendant

adopted the device or process in every particular; Proof of an adoption of the
substance of the thing will be sufficient. "In one sense," said Justice Brown, "it
may be said that no device can be adjudged an infringement that does not
substantially correspond with the patent. But another construction, which
would limit these words to exact mechanism described in the patent, would be
so obviously unjust that no court could be expected to adopt it. . . .

The law will protect a patentee against imitation of his patent by other forms
and proportions. If two devices do the same work in substantially the same
way, and accomplish substantially the same result, they are the same, even
though they differ in name, form, or shape. 16

We pronounce petitioner liable for infringement in accordance with Section 37

of Republic Act No. 165, as amended, providing, inter alia:

Sec. 37. Right of Patentees. — A patentee shall have the exclusive right to

make, use and sell the patented machine, article or product, and to use the
patented process for the purpose of industry or commerce, throughout the
territory of the Philippines for the terms of the patent; and such making, using,
or selling by any person without the authorization of the Patentee constitutes
infringement of the patent. (Emphasis ours)

As far as the issue regarding unfair competition is concerned, suffice it to say

that Republic Act No. 166, as amended, provides, inter alia:

Sec. 29. Unfair competition, rights and remedies. — . . .

xxx xxx xxx

In particular, and without in any way limiting the scope of unfair competition,
the following shall be deemed guilty of unfair competition:

(a) Any person, who in selling his goods shall give them the general
appearance of goods of another manufacturer or dealer, either as to the
goods themselves or in the wrapping of the packages in which they are
contained, or the devices or words thereon, or in any other feature of their
appearance, which would be likely to influence purchasers that the goods
offered are those of a manufacturer or dealer other than the actual
manufacturer or dealer, or who otherwise clothes the goods with such
appearance as shall deceive the public and defraud another of his legitimate
trade. . . .

x x x           x x x          x x x

Considering the foregoing, we find no reversible error in the decision of the

Court of Appeals affirming with modification the decision of the trial court.

WHEREFORE, premises considered, the decision of the Court of Appeals is

hereby AFFIRMED and this petition DENIED for lack of merit.

G.R. No. 115106 March 15, 1996

ROBERTO L. DEL ROSARIO, petitioner,

vs.
COURT OF APPEALS AND JANITO CORPORATION, respondents.

BELLOSILLO, J.:p

Roberto del Rosario petitions this Court to review the decision of the Court of
Appeals 1 which set aside the order of the Regional Trial Court of Makati
granting a writ of preliminary injunction in his favor.

The antecedents: On 18 January 1993 petitioner filed a complaint for patent

infringement against private respondent Janito Corporation.2 Roberto L. del
Rosario alleged that he was a patentee of an audio equipment and improved
audio equipment commonly known as the sing-along System
or karaoke under Letters Patent No. UM-5269 dated 2 June 1983 as well as
Letters Patent No. UM-6237 dated 14 November 1986 issued by the Director
of Patents. The effectivity of both Letters Patents was for five (5) years and
was extended for another five (5) years starting 2 June 1988 and 14
November 1991, respectively. He described his sing-along system as a handy
multi-purpose compact machine which incorporates an amplifier speaker, one
or two tape mechanisms, optional tuner or radio and microphone mixer with
features to enhance one's voice, such as the echo or reverb to stimulate an
opera hall or a studio sound, with the whole system enclosed in one cabinet
casing.

In the early part of 1990 petitioner learned that private respondent was
manufacturing a sing-along system bearing the trademark miyata or miyata
karaoke substantially similar if not identical to the sing-along system covered
by the patents issued in his favor. Thus he sought from .the trial court the
issuance of a writ of preliminary injunction to enjoin private respondent, its
officers and everybody elsewhere acting on its behalf, from using, selling and
advertising the miyata or miyata karaoke brand, the injunction to be made
permanent after trial, and praying for damages, attorney's fees and costs of
suit.

On 5 February 1993 the trial court temporarily restrained private respondent

from manufacturing, using and/or selling and advertising the miyata sing-
along system or any sing-along system substantially identical to the sing-
along system patented by petitioner until further orders.

On 24 February 1993 the trial court issued a writ of preliminary injunction

upon a bond on the basis of its finding that petitioner was a holder of a utility
model patent for a sing-along system and that without his approval and
consent private respondent was admittedly manufacturing and selling its own
sing-along system under the brand name miyata which was substantially
similar to the patented utility mode 3 of petitioner.

Private respondent assailed the order of 24 February 1993 directing the

issuance of the writ by way of a petition for certiorari with prayer for the
issuance of a writ of preliminary injunction and a temporary restraining order
before respondent Court of Appeals.

On 15 November 1993 respondent appellate court granted the writ and set
aside the questioned order of the trial court. It expressed the view that there
was no infringement of the patents of petitioner by the fact alone that private
respondent had manufactured the miyata karaoke or audio system, and that
the karaoke system was a universal product manufactured, advertised and
marketed in most countries of the world long before the patents were issued
to petitioner. The motion to reconsider the grant of the writ was
denied;4 hence, the instant petition for review.

This petition alleges that: (a) it was improper for the Court of Appeals to
consider questions of fact in a certiorari proceeding; (b) the Court of Appeals
erred in taking judicial notice of private respondent's self-serving presentation
of facts; (c) the Court of Appeals erred in disregarding the findings of fact of
the trial court; and, (d) there was no basis for the Court of Appeals to grant a
writ of preliminary injunction in favor of private respondent.5

Petitioner argues that in a certiorari proceeding questions of fact are not

generally permitted the inquiry being limited essentially to whether the tribunal
has acted without or in excess of jurisdiction or with grave abuse of discretion;
that respondent court should not have disturbed but respected instead the
factual findings of the trial court; that the movant has a clear legal right to be
protected and that there is a violation of such right by private respondent.
Thus, petitioner herein claims, he has satisfied the legal requisites to justify
the order of the trial court directing the issuance of the writ of injunction. On
the other hand, in the absence of a patent to justify the manufacture and sale
by private respondent of sing-along systems, it is not entitled to the injunctive
relief granted by respondent appellate court.

The crux of the controversy before us hinges on whether respondent Court of

Appeals erred in finding the trial court to have committed grave abuse of
discretion in enjoining private respondent from manufacturing, selling and
advertising the miyata karaoke brand sing-along system for being
substantially similar if not identical to the audio equipment covered by letters
patent issued to petitioner.

Injunction is a preservative remedy for the protection of substantive rights or

interests. It is not a cause of action in itself but merely a provisional remedy,
an adjunct to a main suit. The controlling reason for the existence of the
judicial power to issue the writ is that the court may thereby prevent a
threatened or continuous irremediable injury to some of the parties before
their claims can be thoroughly investigated and advisedly adjudicated. It is to
be resorted to only when there is a pressing necessity to avoid injurious
consequences which cannot be remedied under any standard of
compensation. The application of the writ rests upon an alleged existence of
an emergency or of a special reason for such an order before the case can be
regularly heard, and the essential conditions for granting such temporary
injunctive relief are that the complaint alleges facts which appear to be
sufficient to constitute a cause of action for injunction and that on the entire
showing from both sides, it appears, in view of all the circumstances, that the
injunction is reasonably necessary to protect the legal rights of plaintiff
pending the litigation.6

A preliminary injunction may be granted at any time after the commencement

of the action and before judgment when it is established that the defendant is
doing, threatens, or is about to do, or is procuring or suffering to be done,
some act probably in violation of the plaintiff's rights. Thus, there are only two
requisites to be satisfied if an injunction is to issue, namely, the existence of
the right to be protected, and that the facts against which the injunction is to
be directed are violative of said right.7
For the writ to issue the interest of petitioner in the controversy or the right he
seeks to be protected must be a present right, a legal right which must be
shown to be clear and positive.

In this regard Sec. 55 of R.A. 165 as amended, known as The Patent 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) new
model or 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 provide . . . .

Admittedly, petitioner is a holder of Letters Patent No. UM-5629 dated 2 June

1985 issued for a term of five (5) years from the grant of a Utility Model herein
described —

The construction of an audio equipment comprising a substantially cubical

casing having a window at its rear and upper corner fitted with a slightly
inclined control panel, said cubical (casing) having a vertical partition wall
therein defining a rear compartment and a front compartment, and said front
compartment serving as a speaker baffle; a transistorized amplifier circuit
having an echo section and writhed in at least the printed circuit boards
placed inside said rear compartment of said casing and attached to said
vertical partition wall, said transistorized amplifier circuit capable of being
operated from outside, through various controls mounted on said control
panel of such casing; a loud speaker fitted inside said front compartment of
said casing and connected to the output of the main audio amplifier section of
said transistorized amplifier circuit and a tape player mounted on the top wall
of said casing and said tape player being connected in conventional manner
to said transistorized amplifier circuit.8

Again, on 14 November 1986 petitioner was granted Letters Patent No. UM-
6237 for a term of five (5) years from the grant of a Utility Model described as
—

In an audio equipment consisting of a first cubical casing having an opening at

its rear and upper rear portion and a partition therein forming a rear
compartment and a front compartment serving as a loud speaker baffle, a
control panel formed by vertical and horizontal sections, a transistorized
amplifier circuit wired in at least two printed circuit boards attached at the back
of said control panel, a first loud speaker fitted inside said first compartment of
such first casing and connected to the output of said transistorized amplifier
circuit; the improvement wherein said control panel being removably fitted to
said first cubical casing and further comprises a set of tape recorder and tape
player mounted on the vertical section of said control panel and said recorder
and player are likewise connected to said transistorized amplifier circuit; a
second cubical casing having an opening at its rear, said second cubical
casing having (being?) provided with a vertical partition therein defining a rear
compartment and a front compartment, said rear compartment being provided
with a door and enclosing therein a set of tape racks and said front
compartment serving as loud speaker baffle, said second cubical casing being
adapted to said first cubical casing so that said first and second casings are
secured together in compact and portable form; and a second loud speaker
fitted inside said front compartment of said casing and connected to the
output of said amplifier circuit.9

The terms of both Letters Patents were extended for another five (5) years
each, the first beginning 2 June 1988 and the second, 14 November 1991.

The Patent Law expressly acknowledges that any new model of implements
or tools of any industrial product even if not possessed of the quality of
invention but which is of practical utility is entitled to a patent for utility
model. 10 Here, there is no dispute that the letters patent issued to petitioner
are for utility models of audio equipment.

In issuing, reissuing or withholding patents and extensions thereof, the

Director of Patents determines whether the patent is new and whether the
machine or device is the proper subject of patent. In passing on an
application, the Director decides not only questions of law but also questions
of fact, i.e. whether there has been a prior public use or sale of the article
sought to be patented. 11 Where petitioner 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 Director of Patents in granting the patent is
always presumed to be correct, and the burden then shifts to respondent to
overcome this presumption by competent evidence. 12

Under Sec. 55 of The Patent Law 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.
Respondent corporation failed to present before the trial court competent
evidence that the utility models covered by the Letters Patents issued to
petitioner were not new. This is evident from the testimony of Janito Cua,
President of respondent Janito Corporation, during the hearing on the
issuance of the injunction, to wit —

Q. Mr. Cua, you testified that there are (sic) so many other companies which
already have (sic) the sing-along system even before the patent application of
Mr. del Rosario and as a matter of fact you mentioned Sanyo, Sony and
Sharp, is that right?

A. Musicmate and Asahi.

Q. Now do you recall that your lawyer filed with this Honorable Court an
Urgent Motion to Lift Temporary Restraining Order of this Honorable Court. I
am sure you were the one who provided him with the information about the
many other companies selling the sing-along system, is that right? These 18
which you enumerated here.

A. More than that because. . . .

Q. Now you will agree with me that in your statement Sharp you put the date
as 1985 agreed?

A. No.

Q. You mean your lawyer was wrong when he put the word Sharp 1985?

A. Maybe I informed him already.

x x x           x x x          x x x

Q. You mean your lawyer was wrong in alleging to this Court that Sharp
manufactured and sold (in) 1985 as found in the Urgent Motion?

A. Since it is urgent it is more or less.

Q. The same also with Sanyo 1985 which you put, more or less?

A. Sanyo is wrong.

Q. It is not 1985?

A. Sanyo is 1979 I think.

Q. So this is also wrong. Panasonic 1986 is also wrong?

A. Panasonic I think.

Q. So you don't think this is also correct.

A. The date?

Q. So you don't think also that this allegation here that they manufactured in
1986 is correct?

A. Wrong. Earlier.

Q. National by Precision Electronic 1986 this is also wrong?

A. I think earlier.
Q. So that means all your allegations here from 2 to 5 are wrong? OK. By
Philipps Philippines 1986, this is also correct or wrong?

A. More or less. We said more or less.

Q. Nakabutshi by Asahi Electronics that is also wrong?

A. No that is 1979.

Q. Electone by DICO 1989 is this correct or wrong?

A. Correct. More or less.

Q. Skylers 1985 is that correct or wrong?

A. It is more or less because it is urgent. We don't have time to exact the date.

Q. Musicmate of G.A. Yupangco 1981 this is more or less? You are not also
sure?

A. 95% sure.

Q. Now you are sure 1981.

A. This one because. . . .

Q. Mr. Witness so you are now trying to tell this Honorable Court that all your
allegations here of the dates in this Urgent Motion except for Musicmate
which you are only 95% sure they are all wrong or they are also more or less
or not sure, is that right?

A. More or less.

Q. Now do you have any proof, any advertisement, anything in writing that
would show that all these instruments are in the market, do you have it.

A. No I don't have it because. . . .

Q. No I am satisfied with your answer. Now Mr. Witness, you don't also have
a proof that Akai instrument that you said was also in the market before 1982?
You don't have any written proof, any advertisement?

A. I have the product.

Q. But you have not brought the product in (sic) this Honorable Court, right?

A. No. 13

As may be gleaned herein, the rights of petitioner as a patentee have been

sufficiently established, contrary to the findings and conclusions of respondent
Court of Appeals. Consequently, under Sec. 37 of The Patent law, petitioner
as a patentee shall have the exclusive right to make, use and sell the
patented machine, article or product 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 authorization of the patentee
constitutes infringement of his patent.

Petitioner established before the trial court that respondent Janito Corporation
was manufacturing a similar sing-along system bearing the
trademark miyata which infringed his patented models. He also alleged that
both his own patented audio equipment and respondent's sing-along system
were constructed in a casing with a control panel, the casing having a vertical
partition wall defining the rear compartment from the front compartment, with
the front compartment consisting of a loud speaker baffle, both containing a
transistorized amplifier circuit capable of being operated from outside through
various controls mounted on the control panel, and that both had loud
speakers fitted inside the front compartment of the casing and connected to
the output of the main audio amplifier section both having a tape recorder and
a tape player mounted on the control panel with the tape recorder and tape
player being both connected to the transistorized amplifier circuit. 14

Respondent Janito Corporation denied that there was any violation of

petitioner's patent rights, and cited the differences between its miyata
equipment and petitioner's audio equipment. But, it must be emphasized,
respondent only confined its comparison to the first model, Utility Model No.
5269, and completely disregarded Utility Model No. 6237 which improved on
the first. As described by respondent corporation, 15 these differences are —

First. Under Utility Model 5269, the unit is a substantially cubical casing with a
window at its rear and upper corner fitted with slightly inclined control panel,
while the miyata equipment is a substantially rectangular casing with panel
vertically positioned.

Second. Under Utility Model 5269, the cubical casing has a vertical partition
wall defining a rear compartment and a front compartment serving as a
speaker baffle, while the miyata equipment has no rear compartment and
front compartment in its rectangular casing; it has only a front compartment
horizontally divided into 3 compartments like a 3-storey building, the 1st
compartment being a kit, the 2nd also the speaker, and the 3rd are kits.

Third. Under Utility Model No. 5269, a transistorized amplifier circuit with an
echo section wired in at least 2 printed circuit boards is placed inside the rear
compartment of the casing and attached to the vertical partition wall, the
printed circuit board having 1 amplifier and 1 echo, while in
the miyata equipment the amplifier is mainly IC (Integrated Circuit) —
powered with 8 printed circuit boards almost all of which are IC controlled,
with 1 amplifier with power supply, 1 main tuner, 1 equalizer (3-band), 1 IC
controlled volume control, 1 echo IC, 1 tape pream, 1 instrument and 1
wireless microphone.
Fourth. Under Utility Model 5269, 4 printed circuits are placed inside the
compartment of its casing attached to the vertical partition wall, while in
the miyata, the 7 printed circuit boards (PCB) are attached to the front panel
and 1 attached to the horizontal divider.

Fifth. Under Utility Model 5269, there are various controls mounted on the
control panel of the casing, while in miyata, the various controls are all
separated from the printed circuit boards and the various controls are all
attached thereto.

Sixth. Under Utility Model 5269, a loud speaker fitted inside the front
compartment of the casing is connected to the output of the main audio
amplifier section of the transistorized amplifier circuit, while in miyata, there is
no other way but to use 2 loud speakers connected to the amplifier.

Seventh. Under Utility Model 5269, a tape player is mounted on the top wall of
the casing, while in miyata, 2 tape players are used mounted side by side at
the front.

It is elementary that a patent may be infringed where the essential or

substantial features of the patented invention are taken or appropriated, or the
device, machine or other subject matter alleged to infringe is substantially
identical with the patented invention. In order to infringe a patent, a machine
or device must perform the same function, or accomplish the same result by
identical or substantially identical means and the principle or mode of
operation must be substantially the same. 16

It may be noted that respondent corporation failed to present before the trial
court a clear, competent and reliable comparison between its own model and
that of petitioner, and disregarded completely petitioner's utility Model No.
6237 which improved on his first patented model. Notwithstanding the
differences cited by respondent corporation, it did not refute and disprove the
allegations of petitioner before the trial court that: (a) both are used by a
singer to sing and amplify his voice; (b) both are used to sing with a minus-
one or multiplex tapes, or that both are used to play minus-one or standard
cassette tapes for singing or for listening to; (c) both are used to sing with a
minus-one tape and multiplex tape and to record the singing and the
accompaniment; (d) both are used to sing with live accompaniment and to
record the same; (e) both are used to enhance the voice of the singer using
echo effect, treble, bass and other controls; (g) both are equipped with
cassette tape decks which are installed with one being used for playback and
the other, for recording the singer and the accompaniment, and both may also
be used to record a speaker's voice or instrumental playing, like the guitar and
other instruments; (h) both are
encased in a box-like cabinets; and, (i) both can be used with one or more
microphones. 17

Clearly, therefore, both petitioner's and respondent's models involve

substantially the same modes of operation and produce substantially the
same if not identical results when used.
In view thereof, we find that petitioner had established before the trial
court prima facie proof of violation of his rights as patentee to justify the
issuance of a writ of preliminary injunction in his favor during the pendency of
the main suit for damages resulting from the alleged infringement.

WHEREFORE, the Decision of the Court of Appeals dated 15 November

1993 is REVERSED and SET ASIDE and the Order of the trial court dated 24
February 1993 granting petitioner the writ of injunction is REINSTATED.

The trial court is directed to continue with the proceedings on the main action
pending before it in order to resolve with dispatch the issues therein
presented.

SO ORDERED.

G. R. No. 126627               August 14, 2003

SMITH KLINE BECKMAN CORPORATION, Petitioner,

vs.
THE HONORABLE COURT OF APPEALS and TRYCO PHARMA
CORPORATION, Respondents.

DECISION

CARPIO-MORALES, J.:

Smith Kline Beckman Corporation (petitioner), a corporation existing by virtue

of the laws of the state of Pennsylvania, United States of America (U.S.) and
licensed to do business in the Philippines, filed on October 8, 1976, as
assignee, before the Philippine Patent Office (now Bureau of Patents,
Trademarks and Technology Transfer) an application for patent over an
invention entitled "Methods and Compositions for Producing Biphasic
Parasiticide Activity Using Methyl 5 Propylthio-2-Benzimidazole Carbamate."
The application bore Serial No. 18989.

On September 24, 1981, Letters Patent No. 145611 for the aforesaid invention
was issued to petitioner for a term of seventeen (17) years.

The letters patent provides in its claims2 that the patented invention consisted
of a new compound named methyl 5 propylthio-2-benzimidazole carbamate
and the methods or compositions utilizing the compound as an active
ingredient in fighting infections caused by gastrointestinal parasites and
lungworms in animals such as swine, sheep, cattle, goats, horses, and even
pet animals.

Tryco Pharma Corporation (private respondent) is a domestic corporation that

manufactures, distributes and sells veterinary products including Impregon, a
drug that has Albendazole for its active ingredient and is claimed to be
effective against gastro-intestinal roundworms, lungworms, tapeworms and
fluke infestation in carabaos, cattle and goats.
Petitioner sued private respondent for infringement of patent and unfair
competition before the Caloocan City Regional Trial Court (RTC).3 It claimed
that its patent covers or includes the substance Albendazole such that private
respondent, by manufacturing, selling, using, and causing to be sold and used
the drug Impregon without its authorization, infringed Claims 2, 3, 4, 7, 8 and
9 of Letters Patent No. 145614 as well as committed unfair competition under
Article 189, paragraph 1 of the Revised Penal Code and Section 29 of
Republic Act No. 166 (The Trademark Law) for advertising and selling as its
own the drug Impregon although the same contained petitioner’s patented
Albendazole.5

On motion of petitioner, Branch 125 of the Caloocan RTC issued a temporary

restraining order against private respondent enjoining it from committing acts
of patent infringement and unfair competition.6 A writ of preliminary injunction
was subsequently issued.7

Private respondent in its Answer8 averred that Letters Patent No. 14561 does
not cover the substance Albendazole for nowhere in it does that word appear;
that even if the patent were to include Albendazole, such substance is
unpatentable; that the Bureau of Food and Drugs allowed it to manufacture
and market Impregon with Albendazole as its known ingredient; that there is
no proof that it passed off in any way its veterinary products as those of
petitioner; that Letters Patent No. 14561 is null and void, the application for
the issuance thereof having been filed beyond the one year period from the
filing of an application abroad for the same invention covered thereby, in
violation of Section 15 of Republic Act No. 165 (The Patent Law); and that
petitioner is not the registered patent holder.

Private respondent lodged a Counterclaim against petitioner for such amount

of actual damages as may be proven; ₱1,000,000.00 in moral damages;
₱300,000.00 in exemplary damages; and ₱150,000.00 in attorney’s fees.

Finding for private respondent, the trial court rendered a Decision dated July
23, 1991,9 the dispositive portion of which reads:

WHEREFORE, in view of the foregoing, plaintiff’s complaint should be, as it is

hereby, DISMISSED. The Writ of injunction issued in connection with the case
is hereby ordered DISSOLVED.

The Letters Patent No. 14561 issued by the then Philippine Patents Office is
hereby declared null and void for being in violation of Sections 7, 9 and 15 of
the Patents Law.

Pursuant to Sec. 46 of the Patents Law, the Director of Bureau of Patents is

hereby directed to cancel Letters Patent No. 14561 issued to the plaintiff and
to publish such cancellation in the Official Gazette.

Defendant Tryco Pharmaceutical Corporation is hereby awarded P330,000.00

actual damages and P100,000.00 attorney’s fees as prayed for in its
counterclaim but said amount awarded to defendant is subject to the lien on
correct payment of filing fees.

SO ORDERED. (Underscoring supplied)

On appeal, the Court of Appeals, by Decision of April 21, 1995,10 upheld the

trial court’s finding that private respondent was not liable for any infringement
of the patent of petitioner in light of the latter’s failure to show that
Albendazole is the same as the compound subject of Letters Patent No.
14561. Noting petitioner’s admission of the issuance by the U.S. of a patent
for Albendazole in the name of Smith Kline and French Laboratories which
was petitioner’s former corporate name, the appellate court considered the
U.S. patent as implying that Albendazole is different from methyl 5 propylthio-
2-benzimidazole carbamate. It likewise found that private respondent was not
guilty of deceiving the public by misrepresenting that Impregon is its product.

The appellate court, however, declared that Letters Patent No. 14561 was not
void as it sustained petitioner’s explanation that Patent Application Serial No.
18989 which was filed on October 8, 1976 was a divisional application of
Patent Application Serial No. 17280 filed on June 17, 1975 with the Philippine
Patent Office, well within one year from petitioner’s filing on June 19, 1974 of
its Foreign Application Priority Data No. 480,646 in the U.S. covering the
same compound subject of Patent Application Serial No. 17280.

Applying Section 17 of the Patent Law, the Court of Appeals thus ruled that
Patent Application Serial No. 18989 was deemed filed on June 17, 1995 or
still within one year from the filing of a patent application abroad in compliance
with the one-year rule under Section 15 of the Patent Law. And it rejected the
submission that the compound in Letters Patent No. 14561 was not
patentable, citing the jurisprudentially established presumption that the Patent
Office’s determination of patentability is correct. Finally, it ruled that petitioner
established itself to be the one and the same assignee of the patent
notwithstanding changes in its corporate name. Thus the appellate court
disposed:

WHEREFORE, the judgment appealed from is AFFIRMED with the

MODIFICATION that the orders for the nullification of Letters Patent No.
14561 and for its cancellation are deleted therefrom.

SO ORDERED.

Petitioner’s motion for reconsideration of the Court of Appeals’ decision

having been denied11 the present petition for review on certiorari12 was filed,
assigning as errors the following:

I. THE COURT OF APPEALS GRAVELY ERRED IN NOT FINDING THAT

ALBENDAZOLE, THE ACTIVE INGREDIENT IN TRYCO’S "IMPREGON"
DRUG, IS INCLUDED IN PETITIONER’S LETTERS PATENT NO. 14561,
AND THAT CONSEQUENTLY TRYCO IS ANSWERABLE FOR PATENT
INFRINGEMENT.
II. THE COURT OF APPEALS GRAVELY ERRED IN AWARDING TO
PRIVATE RESPONDENT TRYCO PHARMA CORPORATION P330,000.00
ACTUAL DAMAGES AND P100,000.00 ATTORNEY’S FEES.

Petitioner argues that under the doctrine of equivalents for determining patent
infringement, Albendazole, the active ingredient it alleges was appropriated by
private respondent for its drug Impregon, is substantially the same as methyl
5 propylthio-2-benzimidazole carbamate covered by its patent since both of
them are meant to combat worm or parasite infestation in animals. It cites the
"unrebutted" testimony of its witness Dr. Godofredo C. Orinion (Dr. Orinion)
that the chemical formula in Letters Patent No. 14561 refers to the compound
Albendazole. Petitioner adds that the two substances substantially do the
same function in substantially the same way to achieve the same results,
thereby making them truly identical. Petitioner thus submits that the appellate
court should have gone beyond the literal wordings used in Letters Patent No.
14561, beyond merely applying the literal infringement test, for in spite of the
fact that the word Albendazole does not appear in petitioner’s letters patent, it
has ably shown by evidence its sameness with methyl 5 propylthio-2-
benzimidazole carbamate.

Petitioner likewise points out that its application with the Philippine Patent
Office on account of which it was granted Letters Patent No. 14561 was
merely a divisional application of a prior application in the U. S. which granted
a patent for Albendazole. Hence, petitioner concludes that both methyl 5
propylthio-2-benzimidazole carbamate and the U.S.-patented Albendazole are
dependent on each other and mutually contribute to produce a single result,
thereby making Albendazole as much a part of Letters Patent No. 14561 as
the other substance is.

Petitioner concedes in its Sur-Rejoinder13 that although methyl 5 propylthio-2-

benzimidazole carbamate is not identical with Albendazole, the former is an
improvement or improved version of the latter thereby making both
substances still substantially the same.

With respect to the award of actual damages in favor of private respondent in

the amount of ₱330,000.00 representing lost profits, petitioner assails the
same as highly speculative and conjectural, hence, without basis. It assails
too the award of ₱100,000.00 in attorney’s fees as not falling under any of the
instances enumerated by law where recovery of attorney’s fees is allowed.

In its Comment,14 private respondent contends that application of the doctrine

of equivalents would not alter the outcome of the case, Albendazole and
methyl 5 propylthio-2-benzimidazole carbamate being two different
compounds with different chemical and physical properties. It stresses that
the existence of a separate U.S. patent for Albendazole indicates that the
same and the compound in Letters Patent No. 14561 are different from each
other; and that since it was on account of a divisional application that the
patent for methyl 5 propylthio-2-benzimidazole carbamate was issued, then,
by definition of a divisional application, such a compound is just one of several
independent inventions alongside Albendazole under petitioner’s original
patent application.

As has repeatedly been held, only questions of law may be raised in a petition
for review on certiorari before this Court. Unless the factual findings of the
appellate court are mistaken, absurd, speculative, conjectural, conflicting,
tainted with grave abuse of discretion, or contrary to the findings culled by the
court of origin,15 this Court does not review them.

From an examination of the evidence on record, this Court finds nothing infirm
in the appellate court’s conclusions with respect to the principal issue of
whether private respondent committed patent infringement to the prejudice of
petitioner.

The burden of proof to substantiate a charge for patent infringement rests on

the plaintiff.16 In the case at bar, petitioner’s evidence consists primarily of its
Letters Patent No. 14561, and the testimony of Dr. Orinion, its general
manager in the Philippines for its Animal Health Products Division, by which it
sought to show that its patent for the compound methyl 5 propylthio-2-
benzimidazole carbamate also covers the substance Albendazole.

From a reading of the 9 claims of Letters Patent No. 14561 in relation to the
other portions thereof, no mention is made of the compound Albendazole. All
that the claims disclose are: the covered invention, that is, the compound
methyl 5 propylthio-2-benzimidazole carbamate; the compound’s being
anthelmintic but nontoxic for animals or its ability to destroy parasites without
harming the host animals; and the patented methods, compositions or
preparations involving the compound to maximize its efficacy against certain
kinds of parasites infecting specified animals.

When the language of its claims is clear and distinct, the patentee is bound
thereby and may not claim anything beyond them.17 And so are the courts
bound which may not add to or detract from the claims matters not expressed
or necessarily implied, nor may they enlarge the patent beyond the scope of
that which the inventor claimed and the patent office allowed, even if the
patentee may have been entitled to something more than the words it had
chosen would include.18

It bears stressing that the mere absence of the word Albendazole in Letters
Patent No. 14561 is not determinative of Albendazole’s non-inclusion in the
claims of the patent. While Albendazole is admittedly a chemical compound
that exists by a name different from that covered in petitioner’s letters patent,
the language of Letter Patent No. 14561 fails to yield anything at all regarding
Albendazole. And no extrinsic evidence had been adduced to prove that
Albendazole inheres in petitioner’s patent in spite of its omission therefrom or
that the meaning of the claims of the patent embraces the same.

While petitioner concedes that the mere literal wordings of its patent cannot
establish private respondent’s infringement, it urges this Court to apply the
doctrine of equivalents.
The doctrine of equivalents provides that an infringement also takes place
when a device appropriates a prior invention by incorporating its innovative
concept and, although with some modification and change, performs
substantially the same function in substantially the same way to achieve
substantially the same result.19 Yet again, a scrutiny of petitioner’s evidence
fails to convince this Court of the substantial sameness of petitioner’s
patented compound and Albendazole. While both compounds have the effect
of neutralizing parasites in animals, identity of result does not amount to
infringement of patent unless Albendazole operates in substantially the same
way or by substantially the same means as the patented compound, even
though it performs the same function and achieves the same result.20 In other
words, the principle or mode of operation must be the same or substantially
the same.21

The doctrine of equivalents thus requires satisfaction of the function-means-

and-result test, the patentee having the burden to show that all three
components of such equivalency test are met.22

As stated early on, petitioner’s evidence fails to explain how Albendazole is in

every essential detail identical to methyl 5 propylthio-2-benzimidazole
carbamate. Apart from the fact that Albendazole is an anthelmintic agent like
methyl 5 propylthio-2-benzimidazole carbamate, nothing more is asserted and
accordingly substantiated regarding the method or means by which
Albendazole weeds out parasites in animals, thus giving no information on
whether that method is substantially the same as the manner by which
petitioner’s compound works. The testimony of Dr. Orinion lends no support to
petitioner’s cause, he not having been presented or qualified as an expert
witness who has the knowledge or expertise on the matter of chemical
compounds.

As for the concept of divisional applications proffered by petitioner, it comes

into play when two or more inventions are claimed in a single application but
are of such a nature that a single patent may not be issued for them.23 The
applicant thus is required "to divide," that is, to limit the claims to whichever
invention he may elect, whereas those inventions not elected may be made
the subject of separate applications which are called "divisional
applications."24 What this only means is that petitioner’s methyl 5 propylthio-2-
benzimidazole carbamate is an invention distinct from the other inventions
claimed in the original application divided out, Albendazole being one of those
other inventions. Otherwise, methyl 5 propylthio-2-benzimidazole carbamate
would not have been the subject of a divisional application if a single patent
could have been issued for it as well as Albendazole.1âwphi1

The foregoing discussions notwithstanding, this Court does not sustain the
award of actual damages and attorney’s fees in favor of private respondent.
The claimed actual damages of ₱330,000.00 representing lost profits or
revenues incurred by private respondent as a result of the issuance of the
injunction against it, computed at the rate of 30% of its alleged ₱100,000.00
monthly gross sales for eleven months, were supported by the testimonies of
private respondent’s President25 and Executive Vice-President that the
average monthly sale of Impregon was ₱100,000.00 and that sales
plummeted to zero after the issuance of the injunction.26 While indemnification
for actual or compensatory damages covers not only the loss suffered
(damnum emergens) but also profits which the obligee failed to obtain (lucrum
cessans or ganacias frustradas), it is necessary to prove the actual amount of
damages with a reasonable degree of certainty based on competent proof
and on the best evidence obtainable by the injured party.27 The testimonies of
private respondent’s officers are not the competent proof or best evidence
obtainable to establish its right to actual or compensatory damages for such
damages also require presentation of documentary evidence to substantiate a
claim therefor.28

In the same vein, this Court does not sustain the grant by the appellate court
of attorney’s fees to private respondent anchored on Article 2208 (2) of the
Civil Code, private respondent having been allegedly forced to litigate as a
result of petitioner’s suit. Even if a claimant is compelled to litigate with third
persons or to incur expenses to protect its rights, still attorney’s fees may not
be awarded where no sufficient showing of bad faith could be reflected in a
party’s persistence in a case other than an erroneous conviction of the
righteousness of his cause.29 There exists no evidence on record indicating
that petitioner was moved by malice in suing private respondent.

This Court, however, grants private respondent temperate or moderate

damages in the amount of ₱20,000.00 which it finds reasonable under the
circumstances, it having suffered some pecuniary loss the amount of which
cannot, from the nature of the case, be established with certainty.30

WHEREFORE, the assailed decision of the Court of Appeals is hereby

AFFIRMED with MODIFICATION. The award of actual or compensatory
damages and attorney’s fees to private respondent, Tryco Pharma
Corporation, is DELETED; instead, it is hereby awarded the amount
of P20,000.00 as temperate or moderate damages.

SO ORDERED.