PEARL & DEAN INC. V. SHOEMART INC.

GR NO. 148222, AUGUST 15, 2003

PRELIMINARY MATTERS

FACTS:

Pearl and Dean is a corporation in the manufacture of advertising display units also known as light
boxes, which were manufactured by Metro Industrial Services. A copyright Registration was obtained in
1981. These were marketed in the name of "Poster Ads". They also applied for a registration of trademark
with the Bureau of Patents in 1983, but was only approved in 19988. In 1985, petitioner had an agreement
with respondent Shoemart Inc (SMI) to install these light boxes in their Makati and Cubao branch, Only the
Makati branch was able to sigh the agreement. In 1986, the contract was rescinded unilaterally by SMI, and
instead contracted with Metro Industrial Services. They installed these lightboxes in different SM city
branches, including Cubao and Makati, with association with North Edsa Marketing Inc (NEMI), SMI's sister
company. Petitioner requested SMI and NEMI to put down their installations of the light boxes, and payment
of compensatory damages worth P20M. Claiming that respondents failed to comply, they filed a case for
infringement of trademark and copyright, unfair competition and damages. RTC ruled in favor of petitioner,
but CA reversed.

ISSUE:

1. WON there was a copyright infringement

2. WON there was a patent infringement
3. WON there was a trademark infringement

RULING:

a. There was no copyright infringement in the case at bar.

Copyright is a statutory right, subject to the terms and conditions specified in the statute. Therefore,
it can only cover the works falling within the statutory enumeration or description. Since the copyright was
classified under class "O" works, which includes "prints, pictorial illustrations, advertising copies, labels,
tags and box wraps," and does not include the light box itself. A lightbox, even admitted by the president of
petitioner company, was neither a literary nor an artistic work but an engineering or marketing invention,
thus not included under a copyright.
b. There was no patent infringement in the case at bar.
Petitioner was not able to secure a patent for its lightboxes, thus, it cannot legally prevent anyone
from manufacturing or commercially using the same. Patent has a three-fold purpose: a) to foster and
reward invention; b) promotes disclosures of invention and permit public to use the same upon expiration;
c) stringent requirements for patent protection to ensure in the public domain remain there for free use of
the public. Since petitioner was not able to go through such examination, it cannot exclude others from
manufacturing, or selling such lightboxes.
c. There was no trademark infringement in the case at bar.
P & D was able to secure a trademark certificate but the goods specified were stationeries such as
letterheads, envelopes, calling cards and newsletters.Petitioner admitted that it did not commercially
engage in or market these goods. Furthermore, it only dealt in electrically operated backlit advertising units
and the sale of advertising spaces thereon, which, however, were not at all specified in the trademark
certificate.
In addition, the failure of P & D to secure a trademark registration for specific use on the light boxes
meant that there could not have been any trademark infringement since registration was an essential
element thereof.