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PEARL AND DEAN V.

SMI 409 SCRA 231 Facts: Pearl & Dean (P&D) is engaged in the manufacture of advertising display units referred toas light boxes. These units utilize specially printed posters sandwiched between plastic sheet sand illuminated with backlights. It was able to secure registration over these illuminated display units. The advertising light boxes were marketed under the trademark Poster Ads.In 1985, P&D negotiated with defendant Shoemart, Inc. (SMI) for the lease and installation of thelight boxes in SM North Edsa. However, since SM North Edsa was under construction, SMI offered as alternative SM Makati and Cubao. During the signing of the Contract, SMI only returned the Contract with SM Makati. Manager of petitioner reminded SMI that their agreement includes SM Cubao. However, SMI did not bother to reply. Instead, respondent informed petitioner that they are rescinding the contract for SM Makati due to non-performance. Two years later, SMI engaged the services of EYD Rainbow Advertising to make the light boxes. These were delivered in a staggered basis and installed at SM Megamall and SM City. In 1989,petitioner received reports that exact copy of its light boxes was installed by SMI. It further discovered that North Edsa Marketing Inc. (NEMI), sister company of SMI, was set up primarily tosell advertising space in lighted display units located in SMIs different branches. Petitioner sent letters to respondents asking them to cease using the light boxes and the discontinued use of the trademark Poster Ads. Claiming that SMI and NEMI failed to meet its demand, petitioner filed a case for infringement of trademark and copy right, unfair competition and damages. SMI maintained that it independently developed its poster panels using commonly known techniques and available technology without notice of or reference to P&Ds copyright. In addition, it said that registration of Poster Ads obtained by petitioner was only for stationeries such as letterheads, envelopes and the like. Poster Ads is a generic term which cannot be appropriated as trademark, and, as such, registration of such mark is invalid. It also stressed that P&D is not entitled to the reliefs sought because the advertising display units contained no copyright notice as provided for bylaw. RTC found SMI and NEMI jointly and severally liable for infringement of copyright and trademark.CA reversed saying that it agreed with SMI that what was copyrighted was the technical drawings only and not the light boxes. Light boxes cannot be considered as either prints, pictorial illustrations, advertising copies, labels, tags or box wraps, to be properly classified as copyrightable class O work. In addition, CA stressed that the protective mantle of the Trademark Law extends only to the goods used by the first user as specified in its certificate of registration. The registration of the trademark Poster Ads covers only stationeries such as letterheads, envelopes and calling cards and newsletter. ISSUES: (1) If the engineering or technical drawings of an advertising display unit are granted copyright protection is the light box depicted in such drawings ipso facto also protected by such copyright? (2) Should the light box be registered separately? (3) (3) Can the owner of the registered trademark legally prevent others from using such mark if it is mere abbreviation of a term descriptive of his goods, services or business?

Held: 1.No. Copyright is purely statutory. As such, the rights are limited to what the statute confers. It may be obtained and enjoyed only with respect to the subjects and by the persons, and on the terms and conditions specified in the statute. Accordingly, it can cover only the works falling within the statutory enumeration or description. Petitioner secured copyright under classification class O work. Thus, copyright protection extended only to the technical drawings and not to the light box itself because the latter was not at all in the category of prints, pictorial illustrations, advertising copies, labels, tags and box wraps. What the law does not include, it excludes, and for the good reason: the light box was not aliterary or artistic piece which could be copyrighted under the copyright law. And no less clearly, neither could the lack of statutory authority to make the light box copyrightable be remedied by the simplistic act of entitling the copyright certificate issued by the National Library as Advertising Display Units. It must be noted that copyright is confined to literary and artistic works which are original intellectual creations in the literary and artistic domain protected from the moment of theircreation.2.Yes. Petitioner never secured a patent for the light boxes. It therefore acquired no patent rights which could have protected its invention, if in fact it really was. And because it had no patent, petitioner could not legally prevent anyone from manufacturing or commercially using the contraption. 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 through disclosure. Ideas, once, disclosed to the public without protection of a valid patent, are subject to appropriation without significant restraint. The Patent Law has a three-fold purpose: first, patent law seeks to foster and reward invention; second, it promotes disclosures of inventions to stimulate further innovation and to permit the public to practice the invention once the patent expires; third, the stringent requirements for patent protection seek to ensure that ideas in the public domain remain there for the free use of the public. It is only after an exhaustive examination by the patent office that patent is issued. Therefore, not having gone through the arduous examination for patents, petitioner cannot exclude other s from the manufacture, sale or commercial use of the light boxes on the sole basis of its copyright certificate over the technical drawings.3.Court agrees with CA that the certificate of registration issued by the Director of Patents can confer the exclusive right to use its own symbol only to those goods specified in the certificate, subject to any conditions and limitations specified in the certificate. One who has adopted and used a trademark on his goods does not prevent the adoption and use of the same trademark by others for products which are of a different description. Assuming arguendo that Poster Ads could validly qualify as a trademark, the failure of petitioner to secure a trademark registration for specific use on the light boxes meant that there could not have been any trademark infringement since registration was an essential element thereof. There is no evidence that petitioners use of poster Ads was distinctive or well-known. As noted by CA, petitioners expert witness himself had testified that Poster Ads was not too generic a name. SO it was difficult to identify it with any company. This fact also prevented the application of the doctrine of secondary meaning. Poster Ads was generic and incapable of being used as a trademark because it was used in the field of poster advertising the very business engaged in by petitioner. Secondary meaning means that a word or phrase originally incapable of exclusive appropriation with reference to an article in the market might

nevertheless have been used for so long and so exclusively by one producer with reference to his article that , in the trade and to that branch of the purchasing public, the word or phrase has come to mean that the article was his property. PETITION WAS DENIED.

MANZANO v CA 278 SCRA 688 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. FACTS: Angelita Manzano filed PPO an action for the cancellation of Letters Patent 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. 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 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 two (2) other witnesses, namely, her husband Ong Bun Tua and Fidel Francisco. 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. Director of Patents Cesar C. Sandiego denied 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. Petitioner elevated the decision of the Director of Patents to the Court of Appeals which affirmed the decision of the Director of Patents. Hence, this petition for review on certiorari. ISSUE: Whether the dismissal is proper where the patent applied for has no substantial difference between the model to be patented and those sold by petitioner.

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

MAGUAN v CA 146 SCRA 107 FACTS: 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. And holder 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 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. Petitioner filed a complaint for damages with injunction and preliminary injunction against private respondent with the then Court of First Instance of Rizal The trial court issued an Order granting the preliminary injunction prayed for by petitioner. Consequently, the corresponding writ was subsequently issued.

In challenging these Orders private respondent filed a petition for certiorari with the respondent court but was denied. Hence this petition. ISSUE: (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. HELD: 1) 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." 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. 2) 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.

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.

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