JOSE MARIA COLLEGE OF LAW

Copyrights and Intellectual Property Law

Pearl and Dean (Phil) v Shoemart, Inc and North Edsa Marketing, Inc. [citing Bonito Boats v
Thunder Craft]
GR No. 148222, 15 August 2003
Corona, J.

FACTS: Pearl and Dean (Phil.), Inc. is engaged in the manufacture of advertising display units simply
referred to as light boxes. PDI was able to secure a Certificate of Copyright Registration, the advertising
light boxes were marketed under the trademark “Poster Ads”., PDI negotiated with Shoemart, Inc. for the
lease and installation of the light boxes in certain SM Makati and SM Cubao. PDI submitted for signature
the contracts covering both stores, but only the contract for SM Makati, however, was returned signed.
Eventually, SMI informed PDI that it was rescinding the contract for SM Makati due to non-performance
of the terms thereof.

PDI then found out that exact copies of its light boxes were installed at different SM stores. It was further
discovered that SMI’s sister company, North Edsa Marketing Inc., sells advertising space in lighted
display units located in SMI’s different branches. PDI sent a letter to both SMI and NEMI enjoining them
to cease using the subject light boxes, remove the same from SMI’s establishments and to discontinue the
use of the trademark “Poster Ads,” as well as the payment of compensatory damages.

PDI Then filed case for infringement of trademark and copyright, unfair competition and claim for
damages

SMI’s Contention
It independently developed its poster panels using commonly known techniques and available
technology, without notice of or reference to PDI's copyright.

RTC Decision
SMI and NEMI are jointly and severally liable for trademark and copyright infringement

CA Decision
It reversed the trial court decision

ISSUE: Is SMI and NEMI liable for patent infringement?

RULING: No

PDI never secured a patent for the light boxes. It therefore acquired no patent rights which could have
protected its invention, if in fact it really was. And because it had no patent, PDI could not legally prevent
anyone from manufacturing or commercially using the contraption.

To be able to effectively and legally preclude others from copying and profiting from the invention, a
patent is a primordial requirement. No patent, no protection. The ultimate goal of a patent system is to
bring new designs and technologies into the public domain through disclosure.

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

2. Vargas v Chua, et al
GR No. L-36650, 27 January 1933
Imperial, J.

FACTS: Angel Vargas brought this action to restrain the Chua, et al and the entity Cham Samco & Sons,
their agents and mandatories, from continuing the manufacture and sale of plows similar to his plow,
describe in his patent issued by the US Patent Office, and to compel Chua, et al to pay her damages.

Cham Samco & Sons did not appeal.

CFI Iloilo
The Vargas plow is distinct from the kind of plows that Chua, et al, manufactures,

ISSUE: Whether the plow constitutes a real invention or an improvement for which a patent may be
obtained

RULING: No

Plow does not constitute an invention in the legal sense, and thus not entitled to the protection it sought

When a patent is sought to be enforced, "the questions of invention, novelty, or prior use, and each of
them, are open to judicial examination." The burden of proof to substantiate a charge of infringement is
with the plaintiff. Where, however, the plaintiff introduces the patent in evidence, if it is the due form, it
affords a prima facie presumption of its correctness and validity. The decision of the Commissioner of
Patents in granting the patent is always presumed to be correct. The burden then shifts to the defendant to
overcome by competent evidence this legal presumption. With all due respects, therefore, for the critical
and expert examination of the invention by the United States Patent Office, the question of the validity of
the patent is one for judicial determination, and since a patent has been submitted, the exact question.

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

3. Manzano v CA
GR No. 113388, 05 September 1997
Bellosillo, J.

FACTS: Angelita Manzano filed with the Philippine Patent Office an action for the cancellation of
Letters Patent for a gas burner registered in the name of Melecia Madolaria who subsequently assigned
the letters patent to New United Foundry and Manufacturing Corporation [NUFMC].

Manzano’s Contention
The utility model covered by the letters patent, in this case, an LPG gas burner, was not inventive, new or
useful; 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 that her husband
Ong Bun Tua worked as a helper in the NUFMC where Madolaria used to be affiliated with; that Ong
helped in the casting of an LPG burner which was the same utility model of a burner for which Letters
Patent was issued, and that after her husband's separation from the shop she organized Besco Metal
Manufacturing (BMM) for the casting of LPG burners one of which had the configuration, form and
component parts similar to those being manufactured by NUFMC.

Madolaria’s Contention
She instructed Rolando Madolaria, the General Supervisor of NUFMC, to cast several experimental
models of gas stoves as well as burners based on revised sketches and specification, and that she made
some innovations

Director of Patents Decision

Denied the Petition for Cancellation holding that the evidence of Manzano was not able to establish
convincingly that the patented utility model of Madolaria was anticipated.

CA Decision
Affirmed the ruling of the Director of Patents

ISSUE: Whether the dismissal is proper where the patent applied for ha no substantial difference between
the model to be patented and those by Manzano.

RULING: Yes

Section 7 of RA No. 165, as amended, which is the law on patents, expressly provides — ‘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.’

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.

In issuing Letters Patent to Madolaria, 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.

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

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.

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

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

4. Aguas v De Leon
GR No. L-32160, 30 January
Fernandez, J.

FACTS: Conrado De Leon filed a complaint for infringement of patent against Domiciano Aguas and
F.H. Aquino and Sons

De Leon’s Contention
He is the original first and sole inventor of certain new and useful improvements in the process of making
mosaic pre-cast tiles, and that he a patent was lawfully granted and issued to him; that said invention was
new, useful, not known or used by others in this country before his invention thereof

Aguas’ Contention
De Leon is neither the original first nor sole inventor of the improvements in the process of making
mosaic pre-cast tiles, the same having been used by several tile-making factories in the Philippines and
abroad years before the alleged invention by De Leon

CFI Decision
Granted De Leon’s petition for a Writ of Preliminary Injunction

CA Decision
Affirmed the ruling of the CFI

ISSUE: is the process of making mosaic pre-cast tile an invention/discovery thus entitled to the
protection of patent?

RULING: Yes

The validity of the patent issued by the Philippine Patent Office in favor of De Leon and the question over
the investments, novelty and usefulness of the improved process therein specified and described are
matters which are better determined by the Philippines Patent Office. The technical Staff of the
Philippines Patent Office, composed of experts in their field, have, by the issuance of the patent in
question, accepted the thinness of the De Leon's new tiles as a discovery. There is a presumption that the
Philippine Patent Office has correctly determined the patentability of the improvement by the private
respondent of the process in question.

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

Roma Drug and Romeo Rodriguez v RTC, et al

GR No. 149907, 16 April 2009
Tinga, J.

FACTS: A team composed of the National Bureau of Investigation (NBI) operatives and inspectors of the
Bureau of Food and Drugs (BFAD) conducted a raid on Roma Drug, a duly registered sole proprietorship
of Romeo Rodriguez operating a drug store. The raid was conducted pursuant to a search warrant. Roma
Drug is one of six drug stores which were raided on or around the same time upon the request of
SmithKline Beecham Research Limited (SmithKline), a duly registered corporation which is the local
distributor of pharmaceutical products manufactured by its parent London-based corporation. The local
SmithKline has since merged with Glaxo Wellcome Phil. Inc to form Glaxo SmithKline.

The NBI subsequently filed a complaint against Rodriguez for violation of Section 4 (in relation to
Sections 3 and 5) of Republic Act No. 8203, which prohibits the sale of counterfeit drug.

Hence, this Petition for Prohibition questing the RTC and The Provincial Prosecutor to desist from further
prosecuting Rodriguez.
During preliminary investigation, Rodriguez challenged the constitutionality of the law on Special Law
on Counterfeit Drugs (SLCD) regarding the distribution of their medicine that were considered
counterfeit although they only bought it directly and not from SmithKline.

ISSUE: Whether the contention of Roma Drug is correct.

RULING: Yes.

Section 7 of Rep. Act No. 9502 unequivocally grants third persons the right to import drugs or medicines
whose patent were registered in the Philippines by the owner of the product. The unqualified right of
private third parties such as petitioner to import or possess “unregistered imported drugs” in the
Philippines is further confirmed by the “Implementing Rules to Republic Act No. 9502” promulgated on
November 4, 2008.

It may be that Rep. Act No. 9502 did not expressly repeal any provision of the SLCD. However, it is clear
that the SLCO’s classification of “unregistered imported drugs” as “counterfeit drugs,” and of
corresponding criminal penalties therefore are irreconcilably in the imposition conflict with Rep. Act No.
9502 since the latter indubitably grants private third persons the unqualified right to import or otherwise
use such drugs. Where a statute of later date, such as Rep. Act No. 9502, clearly reveals an intention on
the part of the legislature to abrogate a prior act on the subject that intention must be given effect.

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

6. Creser Precision Systems, Inc. v CA and Floro International Corp

GR No. 118708, 02 February 1998
Martinez, J

FACTS: Floro International Corp is a domestic corporation engaged in the manufacture, production,
distribution and sale of military armaments, munitions, ammunitions and other similar materials. It was
granted by the BPTTT a Letters Patent covering an aerial fuze. oIt subsequently discovered that Creser
Precision Systems, Inc. submitted samples of its patented aerial fuze to the Armed Forces of the
Philippines (AFP) for testing. He learned that CPSI was claiming the aforesaid aerial fuze as its own and
planning to bid and manufacture the same commercially without license or authority from FIC. The latter
sent a letter to CPSI informing it about their existing patent. As an answer, CPSI filed a complaint for
injunction and damages arising from the alleged infringement.

RTC Decision
Issued an Order granting the issuance of a writ of preliminary injunction against FIC.
It subsequently denied FIC’s motion for reconsideration.

CA Decision
Reversed the ruling of the trial court

ISSUE: Whether or not CPSI, not a patentee, may file an action for infringement

RULING: No

Section 42 of R.A. 165, otherwise known as the Patent Law, explicitly provides:
Sec. 42. Civil action for infringement. — Any patentee, or anyone possessing any right, title or interest in
and to the patented invention, whose rights have been infringed, may bring a civil action before the proper
Court of First Instance (now Regional Trial court), to recover from the infringer damages sustained by
reason of the infringement and to secure an injunction for the protection of his right.

Under the aforequoted law, only the patentee or his successors-in- interest may file an action for
infringement. The phrase "anyone possessing any right, title or interest in and to the patented invention"
refers only to the patentee's successors-in-interest, assignees or grantees since actions for infringement of
patent may be brought in the name of the person or persons interested, whether as patentee, assignees, or
as grantees, of the exclusive right.

Moreover, there can be no infringement of a patent until a patent has been issued, since whatever right
one has to the invention covered by the patent arises alone from the grant of patent. In short, a person or
entity who has not been granted letters patent over an invention and has not acquired any light or title
thereto either as assignee or as licensee, has no cause of action for infringement because the right to
maintain an infringement suit depends on the existence of the patent.

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

7. Rosario Maguan v CA and Susana Luchan

GR. L-45101, 28 November 1986
Paras, J.

FACTS: Maguan is doing business under the firm name and style of SWAN MANUFACTURING" while
Luchan is likewise doing business under the firm name and style of "SUSANA LUCHAN POWDER
PUFF MANUFACTURING." Maguan is a patent holder of powder puffs. She informed Luchan 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.

Luchan’s Contention
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. She then filed Petitions for Cancellation
of the said Utility Models.

Maguan then filed a complaint for damages with injunction and preliminary injunction.

RTC Decision
Granted the preliminary injunction prayed for by Maguan, and subsequently denied Luchan’s motion for
reconsideration.

CA Decision
Issued the Writ of Preliminary Injunction, but later on reconsider Luchan’s allegations believing that
Luchan’s products are not identical or even only substantially identical to the products covered by
Maguan's patents.

ISSUE: 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.

RULING: Yes

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.

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).

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

8. Godines v CA and SV-Agro Enterprises, Inc.

GR No. 97343, 13 September 1993
Romero, J.

FACTS: SV-Agro Industries acquired a letter patent issued to one Magdalena Villaruz which covers a
utility model for hand tractor or power tiller by virtue of a deed of assignment executed by the latter in its
favor. SV-Agro after suffering a decline in sales of the patented power tillers, investigated and discovered
that Godines was manufacturing the same power tillers as they have. SV-Agro thus filed a complaint for
patent infringement and unfair competition.

RTV Decision
It held Godnies liable for infringement.

CA Decision
Affirmed RTC decision

ISSUE: Whether or not Godines’ products infringe upon the patent of SV-Agro.

RULING: Yes

Tests have been established to determine infringement. These are (a) literal infringement; and (b) the
doctrine of equivalents.

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.”
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.

It appears from the observation of the trial court that these claims of the patent and the features of the
patented utility model were copied by Godines: In appearance and form, both the floating power tillers of
the defendant and the turtle power tiller of SV-Agro are virtually the same. Viewed from any perspective
or angle, the power tiller of Godines is identical and similar to that of the turtle power tiller of SV-Agro in
form, configuration, design and appearance. The parts or components thereof are virtually the same. In
operation, the floating power tiller of the defendant operates also in similar manner as the turtle power
tiller of SV-Agro.

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

9. Smithkline Beckman Corp. v CA and Tryco Pharma

GR No. 126627, 14 August 2003
Carpio-Morales, J

FACTS: Smith Kline Beckman is a corporation existing by virtue of the laws of the state of
Pennsylvania, United States of America and licensed to do business in the Philippines, filed,, as assignee,
an application for patent over an invention entitled "Methods and Compositions for Producing Biphasic
Parasiticide Activity Using Methyl 5 Propylthio-2-Benzimidazole Carbamate." On 24 September 1981,
the Letters Patent for the aforesaid invention was issued to Smith Kline for a term of seventeen (17)
years.

Tryco Pharma Corporation 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.

Smith Kline sued Tryco Pharma for infringement of patent and unfair competition.

Smith Kline’s Contention

its patent covers or includes the substance Albendazole such that Tryco Pharma, by manufacturing,
selling, using, and causing to be sold and used the drug Impregon without its authorization, infringed its
claims under its Letters Patent.

RTC Decision
Issued a temporary restraining order against Tryco Pharma

Tryco Pharma’s Contention

Smith Kline’s Letters Patent 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

RTC Decision [on Tryco Pharma’s reconsideration]

Smith Kline’s complaint should be dismissed

CA Decision
Upheld RTC ruling

ISSUE: whether Tryco Pharma committed patent infringement to the prejudice of Smith Kline

RULING: No

The burden of proof to substantiate a charge for patent infringement rests on the plaintiff. In the case at
bar, Smith Kline’s evidence consists primarily of its Letters Patent, 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 Smith Kline’s Letters Patent 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

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Copyrights and Intellectual Property Law

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. 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.

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

10. Smith Kline & French, Ltd. v CA and Danlex Laboratories

GR No. 121267, 23 October 2001
Kapunan, J.

FACTS: Smith Kline is the assignee of a Letters Patent covering pharmaceutical product Cimetidine,
which relates to derivatives of heterocyclicthio or lower alkoxy or amino lower alkyl thiourea, ureas or
guanadines. Said patent was issued by the BPTTT to Graham John Durant, John Collin Emmett and
Robin Genellin on 29 November 1978. On 21 August 1989, Danlex filed with the BPTTT a petition for
compulsory license to manufacture and produce its own brand of medicines using Cimetidin, which was
opposed by Smith Kline arguing that the Danlex had no cause of action and failed to allege how it
intended to work the patented product.

BPTTT Decision
Directed the issuance of the compulsory license to Danlex

CA Decision
Denied Smith Kline’s Petition for Review with its subsequent motion for reconsideration as well as
petition for issuance of a temporary restraining order

ISSUE: Did the CA err in affirming the validity of the grant of BPTTT of a compulsory license to
Danlex?

RULING: No

The said grant is in accord with Section 34 of the Patent Law which provides:
Grounds for Compulsory Licensing.—

(1) Any person may apply to the Director for the grant of a license under a particular patent at any time
after the expiration of two years from the date of the grant of the patent, under any of the following
circumstances:
(a) If the patented invention is not being worked within the Philippines on a commercial scale,
although capable of being so worked, without satisfactory reason;
(b) If the demand of the patented article in the Philippines is not being met to an adequate extent
and on reasonable terms;
(c) If, by reason of refusal of the patentee to grant a license or licenses on reasonable terms, or by
reason of the conditions attached by the patentee to licensee or to the purchase, lease or use of the
patented article or working of the patented process or machine for production, the establishment
of any new trade or industry in the Philippines is prevented, or the trade or industry therein is
unduly restrained;
(d) If the working of the invention within the country is being prevented or hindered by the
importation of the patented article;
(e) If the patented invention or article relates to food or medicine or manufactured substances
which can be used as food or medicine, or is necessary for public health or public safety.

(2) In any of the above cases, a compulsory license shall be granted to the petitioner provided that he has
proved his capability to work the patented product or to make use of the patented product in the
manufacture of a useful product, or to employ the patented process.

(3) The term "worked" or "working" as used in this section means the manufacture and sale of the
patented article, of patented machine, or the application of the patented process for production, in or by

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Copyrights and Intellectual Property Law

means of a definite and substantial establishment or organization in the Philippines and on a scale which
is reasonable and adequate under the circumstances. Importation shall not constitute "working".

The grant of the compulsory license satisfies the requirements of the foregoing provision. More than ten
years have passed since the patent for Cimetidine was issued to Smith Kline and its predecessors- in-
interest, and the compulsory license applied for by Danlex is for the use, manufacture and sale of a
medicinal product. Furthermore, Danlex had the capability to work Cimetidine or to make use thereof in
the manufacture of a useful product.

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JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

11. Parke Davies & Co. v Doctors Pharmaceuticals, Inc.

GR No. L-22221, 31 August 1965
Bautista Angelo, J

FACTS: Parke Davies & Co. is a foreign corporation organized and existing under the laws of the State
of Michigan, U.S.A., with principal office in the City of Detroit, and as such is the owner of a patent
entitled "Process for the Manufacturing of Antibiotics" which was issued by the Philippine Patent Office
on 09 February 1950. It relates to a chemical compound represented by a formula commonly called
chloramphenicol. The patent contains ten claims, nine of which are process claims, and the other is a
product claim to the chemical substance chloramphenicol.

Doctors' Pharmaceuticals, Inc., on the other hand, is a domestic corporation duly organized under our
Corporation Law. On 09 October 1959, its general manager wrote a letter to Parke Davis & Company
requesting that it be granted a voluntary license "to manufacture and produce our own brand of medicine,
containing chloramphenicol, and to use, sell, distribute, or otherwise dispose of the same in the
Philippines under such terms and conditions as may be deemed reasonable and mutually satisfactory," to
which Parke Davis & Company replied requesting information concerning the facilities and plans for the
manufacture of chloramphenicol of Doctors' Pharmaceuticals, Inc. The latter answered saying that it did
not intend to manufacture chloramphenicol itself but its purpose was merely to use it in its own brand of
medicinal preparations.

Parke Davis & Company was not inclined to grant the request for a voluntary license, Doctors'
Pharmaceuticals, Inc. filed a petition with the Director of Patents, which was later amended, praying that
it be granted a compulsory license.

Doctor’s Pharmaceuticals’ Contention

It must be authorized to manufacture, use and sell its own products containing choramphenicol as well as
its own brand and trademark for the following reasons:
(1) the patented invention relates to medicine and is necessary for public health and safety;
(2) Parke Davis & Company is unwilling to grant petitioner a voluntary license under said patent by
reason of which the production and manufacture of needed medicine containing chloramphenicol has
been unduly restrained to a certain extent that it is becoming a monopoly;
(3) the demand for medicine
containing chloramphenicol is not being met to an adequate extent and on reasonable prices; and
(4) the patented invention is not being worked in the Philippines on a commercial scale

Parke Davies & Co.’s Contention

It opposed the petition on grounds that a compulsory license may only be issued to one who will work the
patent and Doctor’s Pharmaceuticals does not intend to work it itself but merely to import the patented
product; and that the patented invention is not necessary for public health and safety.

Director of Patent’s Decision

Granted Doctor’s Pharma’s prayer for license.

ISSUE: whether or not the Director of Patents gravely abused his discretion in ordering the grant of
compulsory license to Doctor’s Pharma for the manufacture of preparations containing chloramphenicol
under the Letters Patent issued to Parke Davies & Co. despite the written objection interposed against it
by the latter.

RULING:

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Copyrights and Intellectual Property Law

CHAPTER VIII. — Compulsory Licensing

SEC. 34. Grounds for compulsory license. — Any person may apply to the Director for the grant of a
license under a particular patent at any time after the expiration of three years from the date of the grant
of the patent, under any of the following circumstances:
(a) If the patented invention is not being worked within the Philippines on a commercial scale,
although capable of being so worked, without satisfactory reason;
(b) If the demand for the patented article in the Philippines is not being met to an adequate extent
and on reasonable terms, without satisfactory reason;
(c) If by reason of the refusal of the patentee to grant a license or licenses on reasonable terms, or
by reason of the conditions attached by the patentee to licenses or to the purchase, lease or use of
the patented article or working of the patented process or machine of production the
establishment of any new trade or industry in the Philippines is prevented, or the trade or industry
therein is unduly restrained; or
(d) If the patented invention relates to food or medicine or is necessary for public health or public
safety.

The term "worked" or "working" as used in this section means the manufacture and sale of a patented
article, or the carrying on of a patented process or the use of a patented machine for production, in or by
means of a definite and substantial establishment or organization in the Philippines and on a scale which
is adequate and reasonable under the circumstances.

SEC. 35. Notice and hearing. — Upon the filing of a petition under section thirty-four hereof, notice shall
be given in the same manner and form as that provided in section thirty-one, Chapter VII hereof.

SEC. 36. Grant of license. — If The Director finds that a case for the grant of a license under section
thirty-four hereof has been made out, he may order the grant of an appropriate license and in default of an
agreement among the parties as to the terms and conditions of the license he shall fix the terms and
conditions of the license in the order.

The order of the Director granting a license under this Chapter, when final, shall operate as a deed
granting a license executed by the patentee and the other parties in interest.

A cursory reading of the provisions above-quoted will reveal that any person may apply for the grant of a
license under any of the circumstances stated in Section 34 (a), (b), (c) or (d), which are in the disjunctive,
showing that any of the circumstances thus enumerated would be sufficient to support the grant, as
evidenced by the use of the particle "or" between paragraphs (c) and (d). As may be noted, each of these
circumstances stands alone and is independent of the others. And from them we can see that in order that
any person may be granted a license under a particular patented invention relating to medicine under
Section 34(d), it is sufficient that the application be made after the expiration of three years from the date
of the grant of the patent and that the Director should find that a case for granting such license has been
made out.

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

12. Ching v Salinas

GR No.1 61295, 29 June 2005
Callejo, Sr, J.

FACTS: Jessie G. Ching is the owner and general manager of Jeshicris Manufacturing Co., the maker
and manufacturer of a Utility Model, described as "Leaf Spring Eye Bushing for Automobile" made up of
plastic. Ching and Joseph Yu were issued by the National Library Certificates of Copyright Registration
and Deposit of the said work. Ching requested the National Bureau of Investigation (NBI) for
police/investigative assistance for the apprehension and prosecution of illegal manufacturers, producers
and/or distributors of the works. After due investigation, the NBI filed applications for search warrants
against William Salinas, Sr. and the officers and members of the Board of Directors of Wilaware Product
Corporation. It was alleged that Salinas therein reproduced and distributed the said models.

Salinas’ Contention
The works covered by the certificates issued by the National Library are not artistic in nature; they are
considered automotive spare parts and pertain to technology. They aver that the models are not original,
and as such are the proper subject of a patent, not copyright.

RTC Decision
Quashed the search warrant on its finding that there was no probable cause for its issuance.

CA Decision
Affirmed RTC Decision

ISSUE: Whether or not Ching is entitled to copyright protection on the basis of the certificates of
registration issued to it.

RULING: No

No copyright granted by law can be said to arise in favor of the Ching despite the issuance of the
certificates of copyright registration and the deposit of the Leaf Spring Eye Bushing and Vehicle Bearing
Cushion.

Copyright, in the strict sense of the term, is purely a statutory right. It is a new or independent right
granted by the statute, and not simply a pre-existing right regulated by it. Being a statutory grant, the
rights are only such as the statute confers, and may be obtained and enjoyed only with respect to the
subjects and by the persons, and on terms and conditions specified in the statute. Accordingly, it can cover
only the works falling within the statutory enumeration or description.

Ownership of copyrighted material is shown by proof of originality and copyrightability. To discharge his
burden, the applicant may present the certificate of registration covering the work or, in its absence, other
evidence. A copyright certificate provides prima facie evidence of originality which is one element of
copyright validity. It constitutes prima facie evidence of both validity and ownership and the validity of
the facts stated in the certificate.

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

13. Del Rosario v CA and Janito Corp.

GR No. 115106, 15 March 1996
Bellosillo, J

FACTS: Del Rosario filed a complaint for patent infringement against Janito Corporation

Del Rosario’s Contention

He was a patentee of an audio equipment and improved audio equipment commonly known as the sing-
along System or karaoke. He then learned that Janito Corp. 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.

RTC Decision
Issued a writ of preliminary injunction upon a bond on the basis of its finding that Del Rosario was a
holder of a utility model patent for a sing-along system and that without his approval and consent Janito
Corp. was admittedly manufacturing and selling its own sing-along system under the brand name miyata
which was substantially similar to the patented utility mode of Del Rosario.

CA Decision
Set aside the RTC Decision

ISSUE: Whether or not Janito Corp must be enjoined 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 Del Rosario

RULING:

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.

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, Del Rosario is a holder of Letters Patent. 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. Here, there is no dispute
that the letters patent issued to Del Rosario are for utility models of audio equipment.

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

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. Janito Corp. failed to present before the trial court
competent evidence that the utility models covered by the Letters Patents issued to Del Rosario were not
new.

As may be gleaned herein, the rights of Del Rosario as a patentee have been sufficiently established.

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

14. Keeler v Standard Folding-Bed

08 April 1895, 157 US 659

FACTS: The Standard Folding-Bed Company, a corporation of the State of New York, filed a bill of
complaint against Keeler & Bro., partners doing business in the City of Boston. Keeler & Bro. are
assignees for the State of Massachusetts of certain letters patent granted to one Lyman Welch, for an
improvement in wardrobe bedsteads; that the Welch Folding Bed Company own the patent rights for the
State of Michigan, and that Standard Folding-Bed purchased a carload of said beds from the Welch
Folding Bed Company at Grand Rapids, Michigan, for the purpose of selling them in Massachusetts, and
they they afterwards sold and are now engaged in selling the said beds in Boston.

ISSUE: Whether a patentee may protect himself and his assignees by special contracts brought home to
the purchasers

RULING: One who buys patented articles of manufacture from one authorized to sell them at the place
where they are sold becomes possessed of an absolute property in such articles, unrestricted in time or
place

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

15. Air Philippines Corp. v Pennswell, Inc.

GR No. 172835, 13 December 2007
Chico-Nazario, J.

FACTS: Air Philippines Corporation is a domestic corporation engaged in the business of air
transportation services. On the other hand, Pennswell, Inc. was organized to engage in the business of
manufacturing and selling industrial chemicals, solvents, and special lubricants.

Both entered into a contract; Air Phil. failed to pay its outstanding balance. Pennswell, Inc. filed a
collection of sum of money

AIR PHIL.’S CONTENTION

Its refusal is due to purported fraud of the ingredients of the object of their contract.
It also prayed that Pennswell be ordered to provide a detailed list of their ingredients.

PENNSWELL’S CONTENTION
It raised the matter of “trade secret.”

ISSUE: Are the ingredients of Pennswell’s products considered trade secrets and not subject to
compulsory disclosure?

RULING: Yes

Pennswell’s ingredients are considered trade secrets because the detailed ingredients sought to be revealed
will have a commercial value to Pennswell.

In the case at bar, Air Phi. cannot rely on Section 77 of Republic Act 7394, or the Consumer Act of the
Philippines, in order to compel Pennswell to reveal the chemical components of its products. While it is
true that all consumer products domestically sold, whether manufactured locally or imported, shall
indicate their general make or active ingredients in their respective labels of packaging, the law does not
apply to Penswell. Pennswell’s specialized lubricants are not consumer products.

"Consumer products," as it is defined in Article 4(q), refers to goods, services and credits, debts or
obligations which are primarily for personal, family, household or agricultural purposes, which shall
include, but not be limited to, food, drugs, cosmetics, and devices. This is not the nature of Pennswell’s
products. Its products are not intended for personal, family, household or agricultural purposes. Rather,
they are for industrial use, specifically for the use of aircraft propellers and engines.

Hence, it is a trade secret not subject to compulsory disclosure.

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

16. Graham, et al v John Deere Co. of Kansas City, et al

21 February 1966, 383 US 1

FACTS: William T. Graham applied for a patent on a mechanical device designed to absorb shock from
the plow shanks in rocky soil. The installed clamp prevented damage to the plow. He obtained U.S.
Patent. In the following years, he improved his invention by changing the place of the hinge plate in order
to minimize the outward motion of the shank away from the plate. He was granted another U.S. patent for
this improvement. It was the latter patent that was at dispute in this case.

RULING IN THE FIFTH CIRCUIT

Held the patent valid because a combination is patentable when it produces an "old result in a cheaper and
otherwise more advantageous way."

RULING IN THE EIGHT CIRCUIT

Since there was no new result in the combination, the patent was invalid.

RULING:

In this case, the U.S. Supreme Court established that the element of non-obviousness must be assessed
with the help of the following factors:
(1) the scope and content of prior art;
(2) the differences between the prior art and the claims at issue; and
(3) the level of ordinary skill in the concerned art.

Furthermore, secondary considerations may be commercial success, long felt but unresolved needs or the
failure of others to find a solution.

PEMBRAIDA PAKAN ANDOY-SANTIAGO

JOSE MARIA COLLEGE OF LAW
Copyrights and Intellectual Property Law

17. Ching v Salinas, Sr, et al

GR No.1 61295, 29 June 2005
Callejo, Sr, J.

FACTS: Jessie G. Ching is the owner and general manager of Jeshicris Manufacturing Co., the maker
and manufacturer of a Utility Model, described as "Leaf Spring Eye Bushing for Automobile" made up of
plastic. Ching and Joseph Yu were issued by the National Library Certificates of Copyright Registration
and Deposit of the said work. Ching requested the National Bureau of Investigation (NBI) for
police/investigative assistance for the apprehension and prosecution of illegal manufacturers, producers
and/or distributors of the works. After due investigation, the NBI filed applications for search warrants
against William Salinas, Sr. and the officers and members of the Board of Directors of Wilaware Product
Corporation. It was alleged that Salinas therein reproduced and distributed the said models.

Salinas’ Contention
The works covered by the certificates issued by the National Library are not artistic in nature; they are
considered automotive spare parts and pertain to technology. They aver that the models are not original,
and as such are the proper subject of a patent, not copyright.

RTC Decision
Quashed the search warrant on its finding that there was no probable cause for its issuance.

CA Decision
Affirmed RTC Decision

ISSUE: Whether or not Ching’s model is an artistic work subject to copyright protection.

RULING: No

As gleaned from the specifications appended to the application for a copyright certificate filed by Ching,
the said Leaf Spring Eye Bushing for Automobile and Vehicle Bearing Cushion are merely utility models.
From the description of the models and their objectives, these articles are useful articles which are defined
as one having an intrinsic utilitarian function that is not merely to portray the appearance of the article or
to convey information. Plainly, these are not literary or artistic works. They are not intellectual creations
in the literary and artistic domain, or works of applied art. They are certainly not ornamental designs or
one having decorative quality or value. Indeed, while works of applied art, original intellectual, literary
and artistic works are copyrightable, useful articles and works of industrial design are not. A useful article
may be copyrightable only if and only to the extent that such design incorporates pictorial, graphic, or
sculptural features that can be identified separately from, and are capable of existing independently of the
utilitarian aspects of the article.

In this case, the bushing and cushion are not works of art. They are, as Chinghimself admitted, utility
models which may be the subject of a patent.

PEMBRAIDA PAKAN ANDOY-SANTIAGO