Intellectual Property : July 19, 2019

FERNANDO U. JUAN v. ROBERTO U. JUAN  [ GR No. 221732, Aug 23, 2017] 

Respondent Roberto U. Juan claimed that he began using the name and mark "Lavandera
Ko" in his laundry business on July 4, 1994. He then opened his laundry store at No. 119
Alfaro St., Salcedo St., Makati City in 1995. Thereafter, on March 17, 1997, the National
Library issued to him a certificate of copyright over said name and mark. Over the years, the
laundry business expanded with numerous franchise outlets in Metro Manila and other
provinces. Respondent Roberto then formed a corporation to handle the said business,
hence, Laundromatic Corporation (Laundromatic) was incorporated in 1997, while
"Lavandera Ko" was registered as a business name on November 13, 1998 with the
Department of Trade and Industry (DTI). Thereafter, respondent Roberto discovered that his
brother, petitioner Fernando was able to register the name and mark "Lavandera Ko" with
the Intellectual Property Office (IPO) on October 18, 2001, the registration of which was filed
on June 5, 1995. Respondent Roberto also alleged that a certain Juliano Nacino (Juliano)
had been writing the franchisees of the former threatening them with criminal and civil cases
if they did not stop using the mark and name "Lavandera Ko." It was found out by
respondent Roberto that petitioner Fernando had been selling his own franchises. 

Thus, respondent Roberto filed a petition for injunction, unfair competition, infringement of
copyright, cancellation of trademark and name with/and prayer for TRO and Preliminary
Injunction with the Regional Trial Court (RTC) and the case was raffled off at Branch 149,
Makati City. The RTC issued a writ of preliminary injunction against petitioner Fernando in
Order dated June 10, 2004. On July 21, 2008, due to the death of respondent Roberto, the
latter was substituted by his son, Christian Juan (Christian). Pre-trial conference was
concluded on July 13, 2010 and after the presentation of evidence of both parties, the RTC
rendered a Resolution dated September 23, 2013, dismissing the petition and ruling that
neither of the parties had a right to the exclusive use or appropriation of the mark
"Lavandera Ko" because the same was the original mark and work of a certain Santiago S.
Suarez (Santiago). According to the RTC, the mark in question was created by Suarez in
1942 in his musical composition called, "Lavandera Ko" and both parties of the present case
failed to prove that they were the originators of the same mark. 

Petitioner appealed to CA but CA dismissed due to technical grounds. 

Petitioner files Certiorari under Rule 45 with the SC. 

Issue:  WHETHER OR NOT A MARK IS THE SAME AS A COPYRIGHT. 

Held: No. The Ruling of RTC is erroneous.

The law on trademarks, service marks and trade names are found under Part III of Republic
Act (R.A.) No. 8293, or the Intellectual Code of the Philippines, while Part IV of the same law
governs copyrights. 

"Lavandera Ko," the mark in question in this case is being used as a trade name or
specifically, a service name since the business in which it pertains involves the rendering of
laundry services. Under Section 121.1 of R.A. No. 8293, "mark" is defined as any visible sign
capable of distinguishing the goods (trademark) or services (service mark) of an enterprise
and shall include a stamped or marked container of goods. As such, the basic contention of
the parties is, who has the better right to use "Lavandera Ko" as a service name because
Section 165.2[13] of the said law, guarantees the protection of trade names and business
names even prior to or without registration, against any unlawful act committed by third
parties. A cause of action arises when the subsequent use of any third party of such trade
name or business name would likely mislead the public as such act is considered unlawful.
Hence, the RTC erred in denying the parties the proper determination as to who has the

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ultimate right to use the said trade name by ruling that neither of them has the right or a
cause of action since "Lavandera Ko" is protected by a copyright. 

By their very definitions, copyright and trade or service name are different. Copyright is the
right of literary property as recognized and sanctioned by positive law.[14] An intangible,
incorporeal right granted by statute to the author or originator of certain literary or artistic
productions, whereby he is invested, for a limited period, with the sole and exclusive
privilege of multiplying copies of the same and publishing and selling them.[15] Trade name,
on the other hand, is any designation which (a) is adopted and used by person to
denominate goods which he markets, or services which he renders, or business which he
conducts, or has come to be so used by other, and (b) through its association with such
goods, services or business, has acquired a special significance as the name thereof, and
(c) the use of which for the purpose stated in (a) is prohibited neither by legislative
enactment nor by otherwise defined public policy.[16] 

Section 172.1 of R.A. 8293 enumerates the following original intellectual creations in the literary and
artistic domain that are protected from the moment of their creation, thus: 

172.1 Literary and artistic works, hereinafter referred to as "works", are original intellectual creations
in the literary and artistic domain protected from the moment of their creation and shall include in
particular: 

(a) Books, pamphlets, articles and other writings;

(b) Periodicals and newspapers;
(c) Lectures, sermons, addresses, dissertations prepared for oral delivery, whether or not reduced in
writing or other material form; 
(d) Letters; 
(e) Dramatic or dramatico-musical compositions; choreographic works or entertainment in dumb
shows; 
(f) Musical compositions, with or without words; 
(g) Works of drawing, painting, architecture, sculpture, engraving, lithography or other works of art;
models or designs for works of art; 
(h) Original ornamental designs or models for articles of manufacture, whether or not registrable as an
industrial design, and other works of applied art;
(i) Illustrations, maps, plans, sketches, charts and three-dimensional works relative to geography,
topography, architecture or science;
(j) Drawings or plastic works of a scientific or technical character;
(k) Photographic works including works produced by a process analogous to photography; lantern
slides; 
(l) Audiovisual works and cinematographic works and works produced by a process analogous to
cinematography or any process for making audio-visual recordings;
(m) Pictorial illustrations and advertisements;
(n) Computer programs; and 
(o) Other literary, scholarly, scientific and artistic works. 

As such, "Lavandera Ko," being a musical composition with words is protected under the
copyright law (Part IV, R.A. No. 8293) and not under the trademarks, service marks and
trade names law (Part III, R.A. No. 8293). 

Considering, therefore, the above premise, this Court deems it proper to remand the case to
the RTC for its proper disposition since this Court cannot, based on the records and some of
the issues raised by both parties such as the cancellation of petitioner's certificate of
registration issued by the Intellectual Property Office, make a factual determination as to
who has the better right to use the trade/business/service name, "Lavandera Ko." 

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Phil. Pharmawealth, Inc. v. Pfizer, Inc. & Pfizer (Phil.), Inc. G.R. No. 167715, 17
November 2010

Pfizer is the registered owner of a Patent which was issued by the BLA-IPO on July 16,
1987. The patent is valid until July 16, 2004. The claims of this Patent are directed to a
method of increasing the effectiveness of a Beta-lactam antibiotic in a mammalian subject.

Pfizer is marketing the product under the patent using the brand name Unasyn. The sole and
exclusive distributor of Unasyn products in the Philippines is Zuellig Pharma Corporation,
pursuant to a Distribution Services Agreement it executed with Pfizer Phils. on January 23,
2001.

Sometime in January and February 2003, Pfizer came to know that petitioner submitted bids
for the supply of Unasyn to several hospitals without the consent of Pfizer and in violation of
their intellectual property rights.

Pfizer thus wrote to the hospitals and demanded that the latter immediately cease and desist
from accepting bids for the supply of Unasyn or awarding the same to entities other than
respondents. respondents, in the same letters sent through undersigned counsel, also
demanded that petitioner immediately withdraw its bids to supply Unasyn.

However, the demands made was ignored. Hence, Respondents prayed for permanent
injunction, damages and the forfeiture and impounding of the alleged infringing products. .An
injunction was issued and effective for 90 days.

While the case was pending before the CA, respondents filed a Complaint with the Regional
Trial Court (RTC) of Makati City for infringement and unfair competition with damages
against herein petitioner. In said case, respondents prayed for the issuance of a temporary
restraining order and preliminary injunction to prevent herein petitioner from importing,
distributing, selling or offering for sale Unasyn products to any entity in the Philippines.
Respondents asked the trial court that, after trial, judgment be rendered awarding damages
in their favor and making the injunction permanent.

RTC directed the issuance of a writ of preliminary injunction prohibiting and restraining
Petitioner, its agents, representatives and assigns from importing, distributing or selling
Sulbactam Ampicillin products to any entity in the Philippines.

ISSUE: WON an injunctive relief be issued based on an action of patent infringement when
the patent allegedly infringed has already lapsed?

HELD: Petitioner argues that respondents’ exclusive right to monopolize the subject matter
of the patent exists only within the term of the patent. Petitioner claims that since
respondents’ patent expired on July 16, 2004, the latter no longer possess any right of
monopoly and, as such, there is no more basis for the issuance of a restraining order or
injunction against petitioner insofar as the disputed patent is concerned.

The Court agrees. Section 37 of Republic Act No. (RA) 165, which was the governing law at
the time of the issuance of respondents’ patent, provides:
Section 37. Rights of patentees. A patentee shall have the exclusive right to make, use and sell the
patented machine, article or product, and to use the patented process for the purpose of industry or
commerce, throughout the territory of the Philippines for the term of the patent; and such making,
using, or selling by any person without the authorization of the patentee constitutes infringement of
the patent. It is clear from the above-quoted provision of law that the exclusive right of a patentee to
make, use and sell a patented product, article or process exists only during the term of the patent.

In the instant case, The patent, which was the basis of respondents in filing their complaint
with the BLA-IPO, was issued on July 16, 1987. This fact was admitted by respondents

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themselves in their complaint. They also admitted that the validity of the said patent is until
July 16, 2004, which is in conformity with Section 21 of RA 165, providing that the term of a
patent shall be seventeen (17) years from the date of issuance thereof. Section 4, Rule 129
of the Rules of Court provides that an admission, verbal or written, made by a party in the
course of the proceedings in the same case, does not require proof and that the admission
may be contradicted only by showing that it was made through palpable mistake or that no
such admission was made. In the present case, there is no dispute as to respondents’
admission that the term of their patent expired on July 16, 2004. Neither is there evidence to
show that their admission was made through palpable mistake. Hence, contrary to the
pronouncement of the CA, there is no longer any need to present evidence on the issue of
expiration of respondents’ patent.

On the basis of the foregoing, the Court agrees with petitioner that after July 16, 2004,
respondents no longer possess the exclusive right to make, use and sell the articles or
products covered by Philippine Letters Patent No. 21116.

a) Can an injunctive relief be issued based on an action of patent infringement when the
patent allegedly infringed has already lapsed?
No. The provision of R.A. 165, from which the Pfizer’s patent was based, clearly states that
"[the] patentee shall have the exclusive right to make, use and sell the patented machine,
article or product, and to use the patented process for the purpose of industry or commerce,
throughout the territory of the Philippines for the term of the patent; and such making, using,
or selling by any person without the authorization of the patentee constitutes infringement of
the patent."

Clearly, the patentee’s exclusive rights exist only during the term of the patent. Since the
patent was registered on 16 July 1987, it expired, in accordance with the provisions of R.A.
165, after 17 years, or 16 July 2004. Thus, after 16 July 2004, Pfizer no longer possessed the
exclusive right to make, use, and sell the products covered by their patent. The CA was
wrong in issuing a temporary restraining order after the cut-off date.

b) What tribunal has jurisdiction to review the decisions of the Director of Legal Affairs
of the Intellectual Property Office?
According to IP Code, the Director General of the IPO exercises exclusive jurisdiction over
decisions of the IPO-BLA. The question in the CA concerns an interlocutory order, and not a
decision. Since the IP Code and the Rules and Regulations are bereft of any remedy
regarding interlocutory orders of the IPO-BLA, the only remedy available to Pfizer is to apply
the Rules and Regulations suppletorily. Under the Rules, a petition for certiorari to the CA is
the proper remedy. This is consistent with the Rules of Court. Thus, the CA had jurisdiction.

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

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

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In-N-Out Burger, Inc. vs. Sehwani Inc., et. Al

Facts: Petitioner IN-N-OUT BURGER, INC., is a business entity incorporated under the laws
of California. It is a signatory to the Convention of Paris on Protection of Industrial Property
and the TRIPS Agreement. It is engaged mainly in the restaurant business, but it has never
engaged in business in the Philippines.

Respondents Sehwani, Incorporated and Benita Frites, Inc. are corporations organized in
the Philippines. Sometime in 1991, Sehwani filed with the BPTTT an application for the
registration of the mark “IN N OUT (the inside of the letter “O” formed like a star). Its
application was approved and a certificate of registration was issued in its name on 1993. In
2000, Sehwani, Incorporated and Benita Frites, Inc. entered into a Licensing Agreement,
wherein the former entitled the latter to use its registered mark, “IN N OUT.”

Sometime in 1997, In-N-Out Burger filed trademark and service mark applications with the
Bureau of Trademarks for the “IN-N-OUT” and “IN-N-OUT Burger & Arrow Design. In 2000,
In-N-Out Burger found out that Sehwani, Incorporated had already obtained Trademark
Registration for the mark “IN N OUT (the inside of the letter “O” formed like a star).” Also in
2000, In-N-Out Burger sent a demand letter directing Sehwani, Inc. to cease and desist from
claiming ownership of the mark “IN-N-OUT” and to voluntarily cancel its trademark
registration. Sehwani Inc. did not accede to In-N-Out Burger’s demand but it expressed its
willingness to surrender its registration for a consideration.

In 2001 In-N-Out Burger filed before the Bureau of Legal Affairs an administrative complaint
against the Sehwani, Inc. and Benita Frites, Inc. for unfair competition and cancellation of
trademark registration.

Issues: Whether or not the Intellectual Property Office (an administrative body) have
jurisdiction of cases involving provisions of the IPC (e.g. unfair competition).[1]

FIRST ISSUE: Yes, the IPO (an administrative body) has jurisdiction in cases involving
provisions of the IPC (e.g. unfair competition) due to the following reasons:
Section 10 of the Intellectual Property Code specifically identifies the functions of the Bureau of Legal
Affairs, thus:

Section 10. The Bureau of Legal Affairs.“The Bureau of Legal Affairs shall have the following
functions:

10.1 Hear and decide opposition to the application for registration of marks; cancellation of
trademarks; subject to the provisions of Section 64, cancellation of patents and utility models, and
industrial designs; and petitions for compulsory licensing of patents;

10.2 (a) Exercise original jurisdiction in administrative complaints for violations of laws involving
intellectual property rights; Provided, That its jurisdiction is limited to complaints where the total
damages claimed are not less than Two hundred thousand pesos (P200,000): Provided, futher, That
availment of the provisional remedies may be granted in accordance with the Rules of Court. Xxx

Xxx

(vi) The cancellation of any permit, license, authority, or registration which may have been
granted by the Office, or the suspension of the validity thereof for such period of time as the Director
of Legal Affairs may deem reasonable which shall not exceed one (1) year;
Xxx

(viii) The assessment of damages;

Unquestionably, petitioner’s complaint, which seeks the cancellation of the disputed mark in
the name of respondent Sehwani, Incorporated, and damages for violation of petitioner’s
intellectual property rights, falls within the jurisdiction of the IPO Director of Legal Affairs.

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While Section 163 thereof vests in civil courts jurisdiction over cases of unfair
competition, nothing in the said section states that the regular courts have
sole jurisdiction over unfair competition cases, to the exclusion of
administrative bodies.
 Sections 160 and 170, which are also found under Part III of the Intellectual
Property Code, recognize the concurrent jurisdiction of civil courts and the IPO
over unfair competition cases.
These two provisions read:

Section 160. Right of Foreign Corporation to Sue in Trademark or Service Mark Enforcement

Action. Any foreign national or juridical person who meets the requirements of Section 3 of this Act
and does not engage in business in the Philippines may bring a civil or administrative
action hereunder for opposition, cancellation, infringement, unfair competition, or false designation of
origin and false description, whether or not it is licensed to do business in the Philippines under
existing laws.

Section 170. Penalties. Independent of the civil and administrative sanctions imposed by law, a

criminal penalty of imprisonment from two (2) years to five (5) years and a fine ranging from Fifty
thousand pesos (P50,000) to Two hundred thousand pesos (P200,000), shall be imposed on any
person who is found guilty of committing any of the acts mentioned in Section 155, Section168, and
Subsection169.1.
Based on the foregoing discussion, the IPO Director of Legal Affairs had jurisdiction
to decide the petitioner’s administrative case against respondents and the IPO
Director General had exclusive jurisdiction over the appeal of the judgment of the IPO
Director of Legal Affairs.

Whether or not there was unfair competition.

SECOND ISSUE: Yes. The evidence on record shows that Sehwani Inc. and Benita Frites
were not using their registered trademark but that of In-n-Out Burger. Sehwani and Benita
Frites are also giving their products the general appearance that would likely influence the
purchasers to believe that their products are that of In-N-Out Burger. The intention to
deceive may be inferred from the similarity of the goods as packed and offered for sale, and,
thus, an action will lie to restrain unfair competition. The respondents’ frauduulent intention
to deceive purchasers is also apparent in their use of the In-N-Out Burger in business
signages.
The essential elements of an action for unfair competition are (1) confusing similarity in the
general appearance of the goods and (2) intent to deceive the public and defraud a
competitor. The confusing similarity may or may not result from similarity in the marks, but
may result from other external factors in the packaging or presentation of the goods. The
intent to deceive and defraud may be inferred from the similarity of the appearance of the
goods as offered for sale to the public. Actual fraudulent intent need not be shown.

 [1] IPO – Director of Legal Affairs decision

 In-N-Out Burger has legal capacity to sue in the Philippines because the latter is a signatory of the Convention of Paris on Protection
of Industrial Property.
 IN-N-OUT Burger, Inc. – right to use its tradename and mark to the exclusion of the others
 Respondents’ use of the petitioner’s mark was made in good faith and therefore they are not guilty of unfair competition.
 IPO – Director General’s Decision
 Respondents are guilty of unfair competition.
 The following are ordered to be paid to In-N-Out Burger, inc.
 Damages in the amount of PHP 212, 574.28
 Exemplary damages in the amount of PHP 500,000
 Attorney’s fees and expenses of litigation in the amount of PHP 500,000
 CA Decision
 Regular courts, and not the BLA-IPO, have sole jurisdiction to hear and decide cases involving provisions of the IPC.

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