INTELLECTUAL PROPERTY LAW
Preliminaries market access for our products. It shall protect and
Intellectual creation is one of the modes of acquiring
ownership under the Civil Code. Discuss.
Article 721. By intellectual creation, the following
persons acquire ownership:
(1) The author with regard to his literary, dramatic,
historical, legal, philosophical, scientific or other work;
(2) The composer; as to his musical composition;
(3) The painter, sculptor, or other artist, with respect
to the product of his art;
(4) The scientist or technologist or any other person
with regard to his discovery or invention. (n)
Article 722. The author and the composer, mentioned
in Nos. 1 and 2 of the preceding article, shall have the
ownership of their creations even before the
publication of the same. Once their works are
published, their rights are governed by the Copyright
laws.
The painter, sculptor or other artist shall have
dominion over the product of his art even before it is
copyrighted.
The scientist or technologist has the ownership of his
discovery or invention even before it is patented. (n)
Article 723. Letters and other private communications
in writing are owned by the person to whom they are
addressed and delivered, but they cannot be published
or disseminated without the consent of the writer or
his heirs. However, the court may authorize their
publication or dissemination if the public good or the
interest of justice so requires. (n)
Article 724. Special laws govern copyright and patent.
When did RA No 8293 or the Intellectual Property Code
of the Philippines took effect? Can it be applied
retroactively?
- It took effect on Jan. 1, 1998. And no, it cannot be
applied retroactively (Mighty Corp vs E&J Gallo
Winery). Hence, an action based on any violation of the
Code prior to Jan. 1, 1998 will not prosper.
What are the state policies on intellectual and industrial
property system?
- The State recognizes that an effective intellectual and
industrial property system is vital to the development
of domestic and creative activity, facilitates transfer of
technology, attracts foreign investments, and ensures
secure the exclusive rights of scientists, inventors,
artists and other gifted citizens to their intellectual
property and creations, particularly when beneficial to
the people, for such periods as provided in this Act.
- The use of intellectual property bears a social function.
To this end, the State shall promote the diffusion of
knowledge and information for the promotion of
national development and progress and the common
good.
- It is also the policy of the State to streamline
administrative procedures of registering patents,
trademarks and copyright, to liberalize the registration
on the transfer of technology, and to enhance the
enforcement of intellectual property rights in the
Philippines.
What does the Code say about international conventions
and reciprocity?
- Any person who is a national or who is domiciled or has
a real and effective industrial establishment in a
country which is a party to any convention, treaty or
agreement relating to intellectual property rights or the
repression of unfair competition, to which the
Philippines is also a party, or extends reciprocal rights
to nationals of the Philippines by law, shall be entitled
to benefits to the extent necessary to give effect to any
provision of such convention, treaty or reciprocal law,
in addition to the rights to which any owner of an
intellectual property right is otherwise entitled by this
Act.
- Any condition, restriction, limitation, diminution,
requirement, penalty or any similar burden imposed by
the law of a foreign country on a Philippine national
seeking protection of intellectual property rights in that
country, shall reciprocally be enforceable upon
nationals of said country, within Philippine jurisdiction.
What are the different intellectual property rights?
1. Copyright and related rights;
2. Trademarks and service marks;
3. Geographic indications;
4. Industrial designs;
5. Patents;
6. Layout designs (topographies) of integrated circuits;
and
7. Protection of undisclosed information;
- *Geographical Indication a sign which identifies a
good as originating from a particular territory, where a
given quality, reputation or characteristic of the good
is essentially attributable to its geographical origin.
- *Industrial Design any composition of lines or colors
or any three dimensional form, whether or not
associated with lines or colors: Provides, that such
composition or form gives a special appearance to and
can serve as a pattern for an industrial product or
handicraft.
Law on Trademark
Definitions to remember:
 1. Trademark Any visible sign capable of distinguishing
the goods or services (in which case it is a service
mark) of an enterprise and shall include a stamped or
marked container of goods.
2. Collective mark Any visible sign designated as such
in the application for registration and capable of
distinguishing the origin or any other common
characteristic, including the quality of goods or services
of different enterprises which use the sign under the
control of the registered owner of the collective mark.
Visualize this: Trademark pertains to a certain
good or service, while a collective mark
pertains to multiple goods and/or services.
3. Trade name Name or designation identifying or
distinguising an enteprise.
Note: A trade name may also be used as a
trademark as theres no prohibition to that
effect.
What are the three-fold function of trademarks?
1. They indicate ORIGIN or ownership of the articles to
which they are attached;
2. They GUARANTEE that those articles come up to a
certain standard of quality; and
3. They ADVERTISE the articles they symbolize
Discuss the importance of trademark.
- Today, the trademark is not merely a symbol of origin
and goodwill; it is often the most effective agent for
the actual creation and protection of goodwill. It
imprints upon the public mind an anonymous and
impersonal guaranty of satisfaction, creating a desire
for further satisfaction. In other words, the mark
actually sells the goods. (Schechter)
- Described to be a silent salesman.
What are the non-registrable marks under Section 123
of the Code? (Memorize by heart and soul)
a) Consists of immoral, deceptive or scandalous matter,
or matter which may disparage or falsely suggest a
connection with persons, living or dead, institutions,
beliefs, or national symbols, or bring them into
contempt or disrepute;
b) Consists of the flag or coat of arms or other insignia of
the Philippines or any of its political subdivisions, or of
any foreign nation, or any simulation thereof;
c) Consists of a name, portrait or signature identifying a
particular living individual except by his written
consent, or the name, signature, or portrait of a
deceased President of the Philippines, during the life of
his widow, if any, except by written consent of the
widow;
d) Is identical with a registered mark belonging to a
different proprietor or a mark with an earlier filing or
priority date, in respect of: (i) The same goods or
services, or (ii) Closely related goods or services, or (iii)
If it nearly resembles such a mark as to be likely to
deceive or cause confusion;
e) Is identical with, or confusingly similar to, or
constitutes a translation of a mark which is considered
by the competent authority of the Philippines to be
well-known internationally and in the Philippines,
whether or not it is registered here, as being already
the mark of a person other than the applicant for
registration, and used for identical or similar goods or
services: Provided, That in determining whether a
mark is well-known, account shall be taken of the
knowledge of the relevant sector of the public, rather
than of the public at large, including knowledge in the
Philippines which has been obtained as a result of the
promotion of the mark;
f) Is identical with, or confusingly similar to, or
constitutes a translation of a mark considered well-
known in accordance with the preceding paragraph,
which is registered in the Philippines with respect to
goods or services which are not similar to those with
respect to which registration is applied for: Provided,
That use of the mark in relation to those goods or
services would indicate a connection between those
goods or services, and the owner of the registered
mark: Provided further, That the interests of the owner
of the registered mark are likely to be damaged by such
use;
g) Is likely to mislead the public, particularly as to the
nature, quality, characteristics or geographical origin of
the goods or services;
h) Consists exclusively of signs that are generic for the
goods or services that they seek to identify;
i) Consists exclusively of signs or of indications that have
become customary or usual to designate the goods or
services in everyday language or in bona fide and
established trade practice;
j) Consists exclusively of signs or of indications that may
serve in trade to designate the kind, quality, quantity,
intended purpose, value, geographical origin, time or
production of the goods or rendering of the services,
or other characteristics of the goods or services;
k) Consists of shapes that may be necessitated by
technical factors or by the nature of the goods
themselves or factors that affect their intrinsic value;
l) Consists of color alone, unless defined by a given form;
or
m) Is contrary to public order or morality.
Discuss and/or give example for each of the
unregistrable marks.
(a) Immoral, scandalous
- Very self-explanatory
- Example:
A person cannot register the mark
P-Noy pertaining to cigarettes,
because it supposedly disparages
our very lovable and respectable
President, even if he himself loves to
smoke.
A person selling apparel cannot use
the mark Harvard. (Fredco vs
Harvard, 2011)
(b) Flags and national symbols
- Very self-explanatory
(c) Particular individuals and deceased presidents
- From the wording of this provision, it appears
that once the widow of a deceased Philippine
president dies, there is absolutely no way a
person may register a trade mark consisting
of the name, portrait signature of a deceased
Philippine president. If its just a normal
 person, then his written consent must be
secured during his lifetime. His spouse cannot
do it for him.
(d) First in time, stronger in right
- A mark that is registered or even one that is
not yet registered but is already filed with the
IPO is protected in respect of (a) the same
goods or services, (b) or closely related goods
or services, (c) or if it nearly resembles such
a mark as to be likely to deceive or cause
confusion.
- The governing principle here is primus in
tempore, potior jure (first in time, stronger in
right).
- See discussion on Colorable Imitation below.
- Also, registered trademark owners enjoy
protection in product and market areas that
are the normal potential expansion of his
business. Hence, a trademark or trade name
is illegal if it is likely to lead to a confusion of
source, as where prospective purchasers
would be misled into thinking that the
complaining party has extended his business
into the field or is in any way connected with
the activities of the infringer; or when it
forestalls the normal potential of his business.
(e) Well-known but not registered
- Example:
Suppose that Somesung is a well-
known mark internationally and
domestically for cellphones, but it is
not registered here in the
Philippines. Pedro cannot register
the trademark Sumsung for the
cellphones he manufactures,
because they are of the same goods.
But suppose that Pedro wants to
register Sumsung or even
Somesung for his staplers, he
might be able to pull it off.
- To be well known does not require that
everybody in the Philippines must be familiar
with the mark but only the relevant sector of
the public. Hence, in determining whether the
trademark Somesung is well known, we
need only ask those who are knowledgable
with cellphones.
(f) Well-known and registered
- Example:
Nike is a well-known mark for
shoes and other sports equipment,
and it is registered here in the
Philippines. Hence, Pedro cannot
registered the mark Nike or even
the swoosh logo even if the goods
involved is a television, because Sec.
123.1(f) covers both related and
unrelated goods, provided that Nike
can prove that Pedros use of the
mark would indicate a connection to
Nike and its goods, and that Nikes
interests are likely to be damaged by
Pedros use of the mark.
- In other words, the scope of protection
afforded to a well-known mark that is
registered here in the Philippines is broader
compared to that of a well-known mark that
is not so registered.
- Take note that prior to the effectivity of the
Intellectual Property Code as well as this
provision, the fact of unrelatedness of goods
is a strong defense against trademark
complaints by well-known marks. (246
Corporation vs Rolex, 2003)
(g) Misleading terms
- Example:
You cant register the mark Mary
Jane for your cigarettes as people
may be led to believe that you are
selling marijuana.
(h) Generic signs
- Example:
You cant register the device of an
image of a fish for the fishes you are
selling.
A trademark device is susceptible to
registration if it is crafted fancifully
or arbitrarily and is capable of
identifying and distinguishing the
goods of one manufacturer or seller
from those of another. Apart from its
commercial utility, the benchmark of
trademark registrability is
distinctiveness.13 Thus, a generic
figure, as that of a shark in this case,
if employed and designed in a
distinctive manner, can be a
registrable trademark device,
subject to the provisions of the IP
Code. (Great White Shark vs
Caralde, 2012)
(j) Descriptive and Generic terms
- This provision prohibits the registrability of
descriptive and generic terms
- Generic terms are those which constitute "the
common descriptive name of an article or
substance," or comprise the "genus of which
the particular product is a species," or are
"commonly used as the name or description
of a kind of goods," or "imply reference to
every member of a genus and the exclusion
of individuating characters," or "refer to the
basic nature of the wares or services provided
rather than to the more idiosyncratic
characteristics of a particular product," and
are not legally protectable.
- A term is descriptive and therefore invalid as
a trademark if, as understood in its normal
and natural sense, it "forthwith conveys the
characteristics, functions, qualities or
ingredients of a product to one who has never
seen it and does not know what it is," or "if it
forthwith conveys an immediate idea of the
ingredients, qualities or characteristics of the
goods," or if it clearly denotes what goods or
services are provided in such a way that the
consumer does not have to exercise powers
of perception or imagination.
- Example:
 You cannot register the mark
Malambot for pillows.
You cannot register the mark
Mabango for perfumes.
The word Lyceum is a generic
term. Since it denotes a school or
institution of learning, it is not
unnatural to use this word to
designate an entity which is
organized and operating as an
educational institution. Hence, it is
not registrable. (Lyceum of the
Philippines vs CA, 1993)
The word Pale Pilsen is a
descriptive
- Generic and descriptive, however are
different from suggestive term. Suggestive
terms are those which, in the phraseology of
one court, require "imagination, thought and
perception to reach a conclusion as to the
nature of the goods." Such terms, "which
subtly connote something about the product,"
are eligible for protection in the absence of
secondary meaning. While suggestive marks
are capable of shedding "some light" upon
certain characteristics of the goods or services
in dispute, they nevertheless involve "an
element of incongruity," "figurativeness," or "
imaginative effort on the part of the
observer." (Societe Des Produits Nestle vs CA
and CFC Corporation, 2001)
- See discussion of the Doctrine of Secondary
Meaning below and relate it here.
- Generic words by themselves cannot be
registered, but combinations thereof are a
different story. For example, the words San
Francisco and coffee by themselves are not
registrable. But the combination of the
wordsSan Francisco Coffeeis protected
against infringement on matters related to the
coffee business to avoid confusing or
deceiving the public (Coffee Parteners Inc vs
San Francisco & Roastery Inc, 2010)
(k) Shapes
- Cant think of example right now.
(l) Color
- Color alone is not registrable, unless it is
defined by a given form.
- Example:
You can register the mark Green
as in the word itself. Its not a color,
its a word.
(m) Public order/morality
- Very self-explanatory
Discuss distinctiveness; degrees of distinctiveness
- A device (such as a word or a logo) can only be
considered a trademark or a service mark if it is
distinctive. A distinctive device is one that is capable of
distinguishing the goods or services upon which it is
used from the goods or services of others. A non-
distinctive device is one that merely describes or names
a characteristic or quality of the goods or services. The
distinctiveness of a device can generally be categorized
into one of five categories which fall along a spectrum
of distinctiveness. From most distinctive to least
distinctive, these categories are
1. Fanciful
2. Arbitrary
3. Suggestive
4. Descriptive
5. Generic
- Devices that are fanciful, arbitrary, or suggestive are
considered distinctive enough to function as
trademarks. On the other hand, if a device is
descriptive, the device can function as a trademark or
service mark only if it has obtained secondary meaning.
Generic devices can never be a trademark. The
"strength" of a mark is determined in part by where it
falls on this spectrum. Fanciful marks are considered
stronger than suggestive marks, and therefore are
granted greater protection by the courts.
What is Colorable Imitation?
- That which denotes such a close or ingenious imitation
as to be calculated to deceive ordinary persons, or such
a resemblance to the original as to deceive an ordinary
purchaser giving such attention as a purchaser usually
gives, as to cause him to purchase the one supposing
it to be the other.
What is the Doctrine of Secondary Meaning?
- This doctrine is to the effect that a word or phrase
originally incapable of exclusive appropriation with
reference to an article on the market, because it is
geographical or otherwise descriptive, may
nevertheless be used exclusively by one producer with
reference to his article so long as in that trade and to
that branch of the purchasing public, the word or
phrase has come to mean that the article was his
product.
- Example:
The term Ginebra is the Spanish term
referring to gin. SMC has a strong case in
claiming that ginebra has acquired a
secondary meaning to it. But that issue was
not ruled upon by the Court in Tanduay vs
GInebra San Miguesl (2009).
What are the two kinds of confusion in trademark-
related cases?
1. Confusion of goods An otherwise prudent purchaser
is induced to purchase one product, believing that he
is purchasing another, in which case defendants goods
are then bought as the plaintiffs and its poor quality
reflects badly on the plaintiffs reputation.
2. Confusion of Business When the goods of the parties
are different but the defendants product can
reasonably (though mistakenly) be assumed to
originate from the plaintiff, thus deceiving the public
into believing that there is some connection between
the plaintiff and defendant which, in fact, does not
exist. This is usually applied in case the goods involved
are non-competing or when the defendant in a
trademark infringement suit uses the defense of
 difference in price (Skechers USA vs Interpacific
Industrial Trading Corp, 2011)
What are the two tests to determine confusing similarity
between marks?
1. Dominancy Test
- It focuses on the similarity of the prevalent
features of the competing trademarks which
might cause confusion or deception, and thus
infringement. If the competing trademark
contains the main, essential or dominant
features of another, and confusion or
deception is likely to result, infringement
takes place. Duplication or exact imitation is
not necessary as long as there is an effort to
imitate.
2. Holistic Test
- Also known as the totality test, it entails a
consideration of the entirety of the marks as
applied to the products, including the labels
and packaging, in determining the confusing
similarity.
When is it proper to apply the dominancy test and when
is it proper to apply the holistic test?
- The Supreme Court has never really been clear,
because in trademark cases, particularly in determining
whether one trademark is confusingly similar to or a
colorable imitation of another, no set rules can be
deduced. Each case must be decided on its own merits.
But as a yardstick, use the following guide:
a) Dominancy Test should be applied when the
goods involved are common and inexpensive
products (i.e. soap, canned goods, candies,
etc.), because the ordinary, because in the
view point of ordinary buyers who are, in
general, undiscerningly rash in buying the
more common and less expensive household
products, and are therefore less inclined to
closely examine specific details of similarities
and dissimilarities between competing
products.
b) Holistic Test should be applied when the goods
involved are a bit more expensive (i.e. clothes,
gadgets, etc.).
This makes sense, because when an
ordinary purchaser buys a common
product in the grocery, he is not
expected to exert time and effort to
inspect whether the product he is
buying is a colorable imitation of
another. He merely looks at the
dominant feature of the trademark
and assumes that what hes getting is
what he intends to get, thus he is
more susceptible to deception.
But note that the Court is not
precluded from applying both tests
when the circumstance so warrants
(Berries Agricultural Co Inc vs Norvy
Abyadang, 2010)
Cigarettes are also proper subject of
the holistic test. Although they are not
really that expensive, cigarettes are
addicting and purchased mainly by
those who are already predisposed to
a certain brand. Accordingly, the
ordinary buyer thereof would be all
too familiar with his brand and
discriminating as well. (Philip Morris
vs Fortune Tobacco, 2006)
Q: Pedro Corp sells beer under the brand name Pedro
Penduko Beer. It registered such trademark. Later on,
Juan Corp which manufactures pencils sought to
registered the trademark Pedro Penduko for its goods.
Will Juans application prosper?
- Qualify whether the earlier trademark is well-known. If
it is well-known, Juan Corp cannot register, assuming
the following concur: (1) use of Juan Corps mark
would indicate a connection with Pedro Corp and its
mark, and (2) Pedro Corp will be prejudiced.
- If it is not well-known, then Juan Corps application will
prosper, except if Juan Corps trademark nearly
resembles Pedro Corps earlier mark as to be likely to
deceive or cause confusion (See Sec. 123.1[d]).
In cases involving similar or non-similar goods, what
must be taken note of?
- The applicable provision would most likely any of the
following: Sec. 123.1 (d , e, and f)
- If one of the mark is well-known, apply either e or f. If
it is well known and not registered, apply e. If it is
well known and registered, apply f.
- If it is not well known, apply d.
Who is an ordinary buyer?
- An ordinary buyer, in the context of trademark law,
refers to the ordinarily intelligent buyer considering the
type of product involved. It does not refer to a
completely unwary customer.
What are the rights conferred to an owner of a
registered mark?
- To prevent all third parties not having the owner's
consent from using in the course of trade identical or
similar signs or containers for goods or services which
are identical or similar to those in respect of which the
trademark is registered where such use would result in
a likelihood of confusion. In case of the use of an
identical sign for identical goods or services, a
likelihood of confusion shall be presumed;
- The exclusive right of the owner of a well-known mark
defined in Subsection 123.1(e) which is registered in
the Philippines, shall extend to goods and services
which are not similar to those in respect of which the
mark is registered: Provided, That use of that mark in
relation to those goods or services would indicate a
connection between those goods or services and the
owner of the registered mark: Provided further, That
the interests of the owner of the registered mark are
likely to be damaged by such use.
In relation to the preceding question, how are those
rights enforced?
- By making use of the following remedies/actions:
 1. Opposition of registration (Sec. 134);
2. Cancellation of registration (Sec. 151);
3. Trademark Infringement (Sec. 155);
4. Trademark Dilution (not statutory, based on
equity);
5. Unfair Competition (Sec. 168);
6. Action for false or fraudulent declaration (Sec.
162);
7. Civil Damages (Sec. 156.1);
8. Injunction (Sec. 156.4);
9. Destruction of Infringing Material (Sec. 157);
Discuss Opposition.
- It must be filed within 30 days after the application was
published;
- It must be in writing and verified;
- If a person fails to oppose an application, he can later
on file a petition for cancellation of registration or sue
for trademark infringement or other proper actions.
Discuss Cancellation of registration.
- A petition to cancel a registration of mark may be filed
with the Bureau of Legal Affairs by any person who
believes that he is or will be damaged by the
registration of a mark.
- It must be filed within five (5) years from the date of
the registration of the mark, except when the petition
is based on the following grounds in which case the
petition may be filed any time.
1. The registered mark becomes the generic
name for the goods or services, or a portion
thereof, for which it is registered;
2. Mark has been abandoned;
3. Registration was obtained fraudulently or
contrary to the provisions of the Code;
4. Registered mark is being used by, or with the
permission of, the registrant so as to
misrepresent the source of the goods or
services on or in connection with which the
mark is used;
5. Registered owner of the mark without
legitimate reason fails to use the mark within
the Philippines, or to cause it to be used in the
Philippines by virtue of a license during an
uninterrupted period of three (3) years or
longer
Q: Pedro filed a petition for cancellation of Juans
certificate of registration. While the case was pending,
Juan sued Pedro for trademark infringement. (1) Can
Pedro invoke prejudicial question? (2) Considering that
it was Pedro who filed the petitioner for cancellation,
can the IPO-BLA validly cancel Pedros own certificate
of registration? (3) Suppose that during the pendency of
the trademark infringement suit, Juans certificate of
registration was cancelled. What is the effect on the
trademark infringement suit?
- (1) No. Under the Intellectual Property Code, there is
no prejudicial question in case an earlier petition for
cancellation is filed. The reason is that the issues in the
two cases are distinct from each other.
- (2) Yes. Although it was Pedro who filed the petition
for cancellation, the IPO-BLA has the authority to
cancel Pedros certificate although such authority does
not conform strictly to the procedures of the Code. As
an administrative agency, the IPO is not bound by strict
rules of procedure. (EY Industrial Sales Inc vs Shen Dar
Electricity & Machinery, 2010)
- (3) It deprives Juan of his cause of action for trademark
infringement, because one of the elements of
trademark infringement is that the mark infringed must
be registered. (Supper Commercial Enterprises Inc vs
Kunnan Enterprise (2010)
What constitutes trademark infringement?
- Any person who shall, without the consent of the
owner of the registered mark:
1. Use in commerce any reproduction,
counterfeit, copy, or colorable imitation of a
registered mark or the same container or a
dominant feature thereof in connection with
the sale, offering for sale, distribution,
advertising of any goods or services including
other preparatory steps necessary to carry
out the sale of any goods or services on or in
connection with which such use is likely to
cause confusion, or to cause mistake, or to
deceive; or
2. Reproduce, counterfeit, copy or colorably
imitate a registered mark or a dominant
feature thereof and apply such reproduction,
counterfeit, copy or colorable imitation to
labels, signs, prints, packages, wrappers,
receptacles or advertisements intended to be
used in commerce upon or in connection with
the sale, offering for sale, distribution, or
advertising of goods or services on or in
connection with which such use is likely to
cause confusion, or to cause mistake, or to
deceive, shall be liable in a civil action for
infringement by the registrant for the
remedies hereinafter set forth: Provided, That
the infringement takes place at the moment
any of the acts stated in Subsection 155.1 or
this subsection are committed regardless of
whether there is actual sale of goods or
services using the infringing material
What are the elements of trademark infringement?
1. The trademark being infringed is registered in the IPO;
however, in infringement of trade name, the same
need not be registered;
Remedies against trademark infringement are
made applicable to trade name infringement.
2. The trademark or trade name is reproduced,
counterfeited, copied, or colorably imitated by the
infringer;
3. The infringing mark or trade name is used in
connection with the sale, offering for sale, or
advertising of any goods, business or services; or the
infringing mark or trade name is applied to labels,
signs, prints, packages, wrappers, receptacles or
advertisements intended to be used upon or in
connection with such goods, business or services;
4. The use or application of the infringing mark or trade
name is likely to cause confusion or mistake or to
deceive purchasers or others as to the goods or
 services themselves or as to the source or origin of
such goods or services or the identity of such business;
and
This is the gravamen of trademark
infringement. This is where we now apply the
tests in determining whether there is
confusion.
5. It is without the consent of the trademark or trade
name owner or the assignee thereof.
*Memory aid:
1. Registered (except trade names)
2. Imitation
3. Unlawfully used in commerce
4. Likelihood of confusion
5. Sans consent of the trademark or trade name
owner
What are the steps to obvserve in resolving trademark
infringement cases?
- First and foremost, determine whether the plaintiffs
trademark is registered in the Philippines (trade names
need not be registered).
- Then, determine that if, on its face, the case has the
five elements of trademark infringement.
- If the answer to the preceding question is yes,
determine now whether there is likelihood of confusion
(which is the most important element) by applying the
applicable tests.
Can a foreign national or juridical person not engaged in
business in the Philippines bring an action here to
enforce trademark rights?
- Yes. 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.
- And Section 3 provides: Any person who is a national
or who is domiciled or has a real and effective industrial
establishment in a country which is a party to any
convention, treaty or agreement relating to intellectual
property rights or the repression of unfair competition,
to which the Philippines is also a party, or extends
reciprocal rights to nationals of the Philippines by law,
shall be entitled to benefits to the extent necessary to
give effect to any provision of such convention, treaty
or reciprocal law, in addition to the rights to which any
owner of an intellectual property right is otherwise
entitled by this Act.
Often cited in trademark cases is the Paris Convention
for the Protection of Industrial Property. What is the
relevant provision in so far as trademark infringement is
concerned?
- Nationals of any country of the Union shall, as regards
the protection of industrial property, enjoy in all the
other countries of the Union the advantages that their
respective laws now grant, or may hereafter grant, to
nationals; all without prejudice to the rights specially
provided for by this Convention. Consequently, they
shall have the same protection as the latter, and the
same legal remedy against any infringement of their
rights, provided that the conditions and formalities
imposed upon nationals are complied with. (Art 2[1])
- The above cited provision was often a subject of
controversy before the Intellectual Property Code took
effect, because the old Trademark Law required prior
and actual use as a prerequisite to registration, while
the Paris Convention did not. In the case of Shangri-La
vs Developers Group of Companies (2006), the Court
held that the Paris Convention cannot prevail over RA
No 166 or the Trademark Law.
- The prevailing doctrine is that prior use is no longer a
condition precedent for registration of trademark,
service mark or trade name. This applies both to
domestic and foreign corporations.
What is trademark dilution and what is the remedy
against it?
- Trademark dilution is the lessening of the capacity of a
famous mark to identify and distinguish goods or
services, regardless of the presence or absence of: (1)
competition between the owner of the famous mark
and other parties; or (2) likelihood of confusion,
mistake or deception;
- Subject to the principles of equity, the owner of a
famous mark is entitled to an injunction against
another persons commercial use in commerce of a
mark or trade name, if such use begins after the mark
has become famous and causes dilution of the
distinctive quality of the mark. This is intended to
protect famous marks from subsequent uses that blur
distinctiveness of the mark or tarnish or disparage it.
What must the plaintiff prove to be entitled to
protection from trademark dilution?
1. The trademark sought to be protected is famous and
distinctive;
2. The use of the second trademark became famous; and
3. Such subsequent use defames the earlier mark.
Can a mere distributor of goods sue for trademark
infringement?
- No. Trademark rights are based on ownership. Thus,
one who is a mere distributer and not the owner of the
goods cannot assert any protection from trademark
infringement as it had no right in the first place to
register a trademark (Superior Commercial Enterprises
Inc vs Kunnan Enterprises Ltd., 2010)
When can an injunction be issued?
- Before an injunctive writ is issued, it is essential that
the following requisites are present:
1. Existence of a right to be protected; and
2. Acts against which the injunction is directed
are violative of the right.
- The applicant must prove that he has a clear and
unmistakable right and the urgent need for an
injunction to prevent serious damage. As applied in
trademark cases, the applicant must show his clear and
unmistakable right to the exclusive use of the
trademark, and that the acts sought to be enjoined
 would cause irreparable damage to the applicant. (See
Tanduay vs Ginebra San Miguel [2009] and Levi
Strauss vs Clinton [2005])
In a trademark infringement suit, what must the
plaintiff prove in order to recover damages?
- Bad faith or knowledge of the defendant that the
imitation is likely to cause confusion, or to cause
mistake, or to deceive.
- In cases where actual intent to mislead the public or to
defraud the complainants is shown, the damages may
be doubled in the discretion of the court.
What are the courts scope of authority?
- In any action involving a registered mark or trade-
name the court may determine the right to registration,
order the cancellation of registrations, in whole or in
part, restore cancelled registration, and otherwise
rectify the register with respect to the registration of
any party to the action. Judgments and orders shall be
certified by the court to the Director, who shall make
appropriate entry upon the records of the Patent
Office, and shall be controlled thereby.
What is unfair competition?
- Any person who shall employ deception or any other
means contrary to good faith by which he shall pass off
the goods manufactured by him or in which he deals,
or his business, or services for those of the one having
established such goodwill, or who shall commit any
acts calculated to produce said result, shall be guilty of
unfair competition, and shall be subject to an action
therefor.
- The operative word here is passing off.
- The inherent elements of unfair competition is:
1. Confusing similarity in the general
appearance of the goods; and
2. Intent to deceive the public and defraud a
competitor
This element may or may not be
present in trademark infringement.
Discuss unfair competition vis--vis trademark
infringement.
- The two are totally distinct from each other. Unfair
competition may subsist even without trademark
infringement. For example, one may be committing
trademark infringement by the unauthorized use of a
registered mark belonging to another, but he is not
guilty of unfair competition unless he has intent to
deceive the public and defraud the competitor.
- In general, trademark infringement is the unauthorized
use of a trademark, whereas unfair competition is the
passing off of ones goods as those of another.
- Fraudulent intent or bad faith is not essential in
trademark infringement, but it is so in unfair
competition.
- Prior registration of the mark is a prerequisite to the
action of trademark infringement, whereas it is not in
unfair competition.
What are some of the modes of committing unfair
competition?
1. Any person, who is selling his goods and gives them
the general appearance of goods of another
manufacturer or dealer, either as to the goods
themselves or in the wrapping of the packages in which
they are contained, or the devices or words thereon,
or in any other feature of their appearance, which
would be likely to influence purchasers to believe that
the goods offered are those of a manufacturer or
dealer, other than the actual manufacturer or dealer,
or who otherwise clothes the goods with such
appearance as shall deceive the public and defraud
another of his legitimate trade, or any subsequent
vendor of such goods or any agent of any vendor
engaged in selling such goods with a like purpose;
2. Any person who by any artifice, or device, or who
employs any other means calculated to induce the false
belief that such person is offering the services of
another who has identified such services in the mind of
the public; or
3. Any person who shall make any false statement in the
course of trade or who shall commit any other act
contrary to good faith of a nature calculated to discredit
the goods, business or services of another.
Discuss false designation of origin and false description
or representation.
- Any person who, on or in connection with any goods
or services, or any container for goods, uses in
commerce any word, term, name, symbol, or device,
or any combination thereof, or any false designation of
origin, false or misleading description of fact, or false
or misleading representation of fact, which:
1. Is likely to cause confusion, or to cause
mistake, or to deceive as to the affiliation,
connection, or association of such person with
another person, or as to the origin,
sponsorship, or approval of his or her goods,
services, or commercial activities by another
person; or
2. In commercial advertising or promotion,
misrepresents the nature, characteristics,
qualities, or geographic origin of his or her or
another person's goods, services, or
commercial activities, shall be liable to a civil
action for damages and injunction provided in
Sections 156 and 157 of this Act by any
person who believes that he or she is or is
likely to be damaged by such act.
What are the prohibited trade names?
1. Contrary to public order or morals; or
2. If it is liable to deceive trade circles or the public as to
the nature of the enterprise identified by that name.
What is disclaimer?
- In registering trademarks, the applicant is required to
disclaim an unregistrable component of an otherwise
registrable mark. The following should be disclaimed to
permit registration:
1. Generic term;
2. Descriptive term;
3. A matter which does not function as a
trademark, or service mark or a trade name
When should a declaration of actual use (DAU) be filed?
1. Within three years from the filing date of the
application (Sec. 124.2);
- The consequences of not failing to file a DAU
within three years from the filing date are: (a)
denial of application and (b) removal of the
mark from the registry. Hence, this implies
that the DAU under Sec. 124.2 applies
whether the application is still pending or
already approved.
2. Within one year from the fifth anniversary of the date
of the registration of the mark
- A certificate of registration shall remain in
force for ten (10) years. But one condition for
the owner to maintain its right over the mark
is actual use of the mark. Hence, a trademark
owner must file a DAU within one year from
the fifth anniversary of the date of the
registration of the mark. Otherwise, the mark
shall be removed from the register.
- Non-use of a mark may be excused if caused
by circumstances arising independently of the
will of the trademark owner. Lack of funds
shall not excuse non-use of a mark.
Q: Pedro filed a trademark application on June 1, 2011.
It was approved on June 1, 2013. On what dates should
a DAU must be filed or should have been filed?
- He must have filed a DAU at any time from June 1,
2011 to June 1, 2014, which is the period within three
years from the date of application. He must also file
another DAU at any time from June 1, 2016 to June 1,
2017, which is the period within one year after the fifth
anniversary of the date of registration.
Patent
Q: What is a patent?
A set of exclusive rights granted by a state to an inventor or
his assignee for a fixed period of time in exchange for a
disclosure of an invention.
Q: What is the three-fold purpose of patent law?
1. Fosters/reward invention;
2. Promotes disclosure to stimulate further inventions; and
3. Ensures that ideas in the public domain remain there for
the free use of the public (this is accomplished by the
stringent requirements for patent protection).
Q: When is an invention patentable?
Any technical solution of a problem in any field of human
activity which is new, involves an inventive step and is
industrially applicable shall be patentable. It may be, or may
relate to, a product, or process, or an improvement of any of
the foregoing.
Elements of Patentability:
1. Novelty;
2. Inventive step; and
3. Industrial applicability.
Q: What are the inventions that are not patentable?
Q: Discuss the elements of patentability.
a) Novelty
- The Code does not define what novelty is.
Instead it provides what is not considered
novelty. An invention shall not be considered
novel if it forms part of a prior art.
- Two classes of prior art:
1. Everything that is already available
to the public not only in the country
but anywhere in the world. The
requirement that the thing is already
in the public domain must be
present before the filing date or the
priority date of the application
claiming the invention; and
2. Those that are actually subject of
application for patent registration.
- See discussion on Filing Date and Non-
Prejudicial Disclosure below
b) Inventive step
- An invention involves an inventive step if,
having regard to prior art, is not obvious to a
person skilled in the art at the time of the
filing date or priority date of the application
claiming the invention.
- Hence, an invention cannot be considered
patentable if it is something obvious to
experts in the field.
- But determination of what constitutes as
obvious necessarily requires consideration of
various factors. In US vs Adams (1966), the
Court considered the skepticism of experts
prior the invention, the endorsement of
experts after disclosure, and unexpected
result. When Herman Anthony invented the
leak-proof dry cell batteries, it was argued
that the means he adopted to invent them
were obvious. Maybe so, but the Court took
note of the fact that for many years prior to
the invention of the leek-proof batteries, no
one was able to cure the defects of the old
dry cell batteries. But once the method was
discovered, it commended itself to the public
as evidenced by marked commercial success.
These factors were considered in determining
whether the improvement amounted to
invention and should, in a close case, tip the
scales in favor of patentability. (Goodyear vs
Ray-O-Vac Company, 1944)
- Graham factors (from Graham vs John Deere
Co. of Kansas City, 1966):
1. Scope and content of the prior art;
2. Level of ordinary skill in the art;
3. Differences between the claimed
invention and the prior art; and
4. Objective evidence of non-
obviousness
- Wikipedia also adds factors to determine non-
obviousness: commercial success, long-felt
but unsolved needs; and failure of others.
c) Industrial applicability
- An invention that can be produced and used
in any industry shall be industrially applicable.
1. Discoveries, scientific theories and mathematical methods,
and in the case of drugs and medicines, the mere discovery
of a new form or new property of a known substance which
does not result in the enhancement of the known efficacy
of that substance, or the mere discovery of any new
property or new use for a known substance, or the mere
use of a known process unless such known process results
in a new product that employs at least one new reactant.
2. Schemes, rules and methods of performing mental acts,
playing games or doing business, and programs for
computers;
3. Methods for treatment of the human or animal body by
surgery or therapy and diagnostic methods practiced on the
human or animal body. This provision shall not apply to
products and composition for use in any of these methods;
4. Plant varieties or animal breeds or essentially biological
process for the production of plants or animals. This
provision shall not apply to micro-organisms and non-
biological and microbiological processes. Provisions under
this subsection shall not preclude Congress to consider the
enactment of a law providing sui generis protection of plant
varieties and animal breeds and a system of community
intellectual rights protection;
5. Aesthetic creations; and
6. Anything which is contrary to public order or morality
Discuss the significance of filing date.
The Code follows the first to file rule thus abandoning the
first to invent system of the old patent law.
Filing date does not literally mean the date the application
was filed. Rather, it should be taken to mean when all the
requirements are present. The requirements are:
1. An express or implicit indication that a Philippine patent
is sought;
2. Information identifying the applicant; and
3. Description of the invention and one (1) or more claims
in Filipino or English.
Discuss priority date.
An application for patent filed by any person who has
previously applied for the same invention in another country
which by treaty, convention, or law affords similar privileges to
Filipino citizens, shall be considered as filed as of the date of
filing the foreign application: Provided, That: (a) the local
application expressly claims priority; (b) it is filed within twelve
(12) months from the date the earliest foreign application was
filed; and (c) a certified copy of the foreign application together
with an English translation is filed within six (6) months from the
date of filing in the Philippines. If any of such requirements is
not submitted within the period set by the IRR, the application
shall be considered withdrawn.
Priority date comes into play when there is an application for
patent for the same invention that was filed in another country.
What is a non-prejudicial disclosure?
Disclosures that will not prejudice the application, meaning
it will not be denied for lack of novelty.
The disclosure of information contained in the application
during the twelve (12) months preceding the filing date or the
priority date of the application shall not prejudice the applicant
on the ground of lack of novelty if such disclosure was made by:
1. The inventor;
2. A patent office and the information was contained (a) in
another application filed by the inventor and should not
have been disclosed by the office, or (b) in an
application filed without the knowledge or consent of
the inventor by a third party which obtained the
information directly or indirectly from the inventor; or
3. A third party which obtained the information directly or
indirectly from the inventor.
Q: Can a mere patent applicant sue for patent
infringement?
Yes. But the action shall be limited to the civil aspect only.
Under Sec. 46 of the Code, The applicant shall have all the rights
of a patentee under Section 76 against any person who, without
his authorization, exercised any of the rights conferred under
Section 71 of this Act in relation to the invention claimed in the
published patent application, as if a patent had been granted for
that invention: Provided, That the said person had:
1. Actual knowledge that the invention that he was using was
the subject matter of a published application; or
2. Received written notice that the invention that he was using
was the subject matter of a published application being
identified in the said notice by its serial number: Provided,
That the action may not be filed until after the grant of a
patent on the published application and within four (4)
years from the commission of the acts complained of.
Q: Harvey commissions Mike to invent something. Who
is entitled to the patent?
As a general rule, Harvey, as the one who commissioned the
work, shall own the patent, unless otherwise provided in the
contract.
Q: Rachel is an employee of Jessica. In the course of her
employment, Rachel invented a time-machine. Who
between Rachel and Jessica is entitled to the patent?
a) Rachel (the employee), if the inventive activity is not a part
of her regular duties even if she uses the time, facilities and
materials of Jessica, her employer.
b) Jessica (the employer), if the invention is the result of the
performance of Rachels regularly-assigned duties, unless
there is an agreement, express or implied, to the contrary.
What should be noted here is that in the first scenario
(where the employee is entitled to the patent), the IPL is silent
as to whether an agreement to the contrary is allowed. It is
submitted that such an agreement to the contrary is not
allowed, considering that in the second scenario, the IPL
expressly allows such agreement. Thus, we can safely assume
that the omission was intended by Congress perhaps to
safeguard the employee-inventor from undue influence of the
employer.
Q: Outline the procedure for the grant of patent.1
1. Filing of the application;
2. Accordance of the filing date;
3. Formality examination;
4. Classification and search;
5. Publication of the application;
6. Substantive examination;
7. Grant (or denial) of the patent;
8. Publication upon grant; and
9. Issuance of the certificate.
Q: What must the application contain under Sec. 32?
1. A request for the grant of a patent;
2. A description of the invention;
The application shall disclose the invention in a manner
sufficiently clear and complete for it to be carried out by a
person skilled in the art. Where the application concerns a
microbiological process or the product thereof and involves
the use of a micro-organism which cannot be sufficiently
disclosed in the application in such a way as to enable the
invention to be carried out by a person skilled in the art, and
such material is not available to the public, the application
shall be supplemented by a deposit of such material with an
international depository institution.
3. Drawings necessary for the understanding of the invention;
4. One or more claims; and
The claim/s shall define the matter for which protection is
sought. Each claim shall be clear and concise and shall be
supported by the description.
5. An abstract.
Q: What do you mean by Unity of Invention?
It means that the application shall relate to one invention
only or to a group of inventions forming a single general
inventive concept.
If several independent inventions which do not form a single
general inventive concept are claimed in one application, the
Director may require that the application be restricted to a single
invention. A later application filed for an invention divided out
shall be considered as having been filed on the same day as the
first application: Provided, That the later application is filed
within four (4) months after the requirement to divide becomes
final or within such additional time, not exceeding four (4)
months, as may be granted: Provided further, That each
divisional application shall not go beyond the disclosure in the
initial application.
The fact that a patent has been granted on an application
that did not comply with the requirement of unity of invention
shall not be a ground to cancel the patent.
Q: How many publications are there in a patent
application?
There are two instances:
First is after the expiration of 18 months from the filing date
or priority date (Sec. 44).
This is important, because during this period, the applicant
shall have all the rights of a patentee under Sec. 76 against any
person who, without his authorization, exercised any of the
1The bulk of this topic does not seem to be very important, so only
important provisions will be discussed.
rights conferred under Sec. 71 of the IPL in relation to the
invention claimed in the published patent application, as if a
patent had been granted for that invention: Provided, That the
said person had:
1. Actual knowledge that the invention that he was using
was the subject matter of a published application; or
2. Received written notice that the invention that he was
using was the subject matter of a published application
being identified in the said notice by its serial number:
Provided, that the action may not be filed until after the
grant of a patent on the published application and within
four (4) years from the commission of the acts
complained of.
In other words, after the first publication, the applicant may
already sue for patent infringement subject to the aforesaid
conditions.
The second instance of publication is when the application
for patent is granted (Sec. 52).
A patent application, which has not yet been published, and
all related documents, shall not be made available for inspection
without the consent of the applicant.
Q: What is the duty of the applicant within 6 months
from the date of [first] publication under Sec. 41?
A written request for a Substantive Examination (or whether
the patent application meets the requirements of Sections 21 to
27 and Sections 32 to 39) must be filed. Otherwise, the
application shall be deemed withdrawn. And this withdrawal
shall be irrevocable and shall not authorize the refund of any
fee.
Remember this! Filing a request for a substantive
examination is the duty of the applicant, not of the Patent
Examiner.
Q: What is the remedy of the applicant in case his
application is refused by the Patent Examiner?
According to the IRR, final decisions of the Patent Examiner
who has original jurisdiction over all applications shall be subject
to appeal to the Director of Patents within four (4) months from
the mailing date of the notice of the decision. As regards
information on any specific technical or scientific matter pending
final action by the Bureau, the applicant may, upon payment of
a fee, request in writing for a conference with the Examiner
specifying the query he would want to propound to the Examiner
but in respect of which the Examiner has the discretion to grant
the request or choose to reply to the query in writing.
Q: What is the term of patent?
The term of a patent shall be twenty (20) years from the
filing date of the application.
Take note of the reckoning periodfrom the filing date of
the application and not from the issuance of the certificate of
patent. You might be easily confused, considering that in
trademark, the duration of 10 years is counted from the issuance
of the certificate.
 But that 20-year period is not absolute. Payment of annual
fees is required (see next topic).
Q: When are annual fees paid?
To maintain the patent application or patent, an annual fee
shall be paid upon the expiration of four (4) years from the date
the application was published pursuant to Sec. 44 (first
publication), and on each subsequent anniversary of such date.
Payment may be made within three (3) months before the due
date. The obligation to pay the annual fees shall terminate
should the application be withdrawn, refused, or cancelled.
If the annual fee is not paid, the patent application shall be
deemed withdrawn or the patent considered as lapsed from the
day following the expiration of the period within which the
annual fees were due. A notice that the application is deemed
withdrawn or the lapse of a patent for non-payment of any
annual fee shall be published in the IPO Gazette and the lapse
shall be recorded in the Register of the Office.
A grace period of six (6) months shall be granted for the
payment of the annual fee, upon payment of the prescribed
surcharge for delayed payment.
Q: When making changes to patents already granted,
the rule is that the patent owner may only make changes
that limit the extent of the protection conferred by the
patent and to correct obvious mistakes or to correct
clerical errors. What is the rule to observe where the
change would result in a broadening of the extent of
protection conferred by the patent?
It must be made within two years from the grant of a patent,
and the change shall not affect the rights of any third party
which has relied on the patent, as published.
Q: What are the acts of the applicant that render the
patent application deemed withdrawn?
1. When any one of the elements required to be afforded a
filing date under Sec. 40 was not submitted;
2. When, after being granted a filing date, the applicant failed
to conform to the formal requirements of the application
under Sec. 32 within the prescribed period;
3. Failure to file a request for substantive examination within
6 months from the first publication;
4. Failure to pay the required fees for the grant of the patent
and the publication in due time; and
5. Failure to pay the annual fees.
Q: Discuss the following: Cancellation of Patent (Sec.
61), Patent Application by Persons Not Having the Right
to a Patent (Sec. 67), Remedies of the True and Actual
Inventor (Sec. 68).2
1. Cancellation of Patent
This is the proper remedy in case the patent is already
granted to one who is actually not entitled thereto. The
petitioner here IS NOT CLAIMING A RIGHT over the patent. The
petition for cancellation shall be in writing and must be verified.
It is filed with the Bureau of Legal Affairs.
2I will discuss these remedies jointly, because, at first, it is quite confusing to
characterize given problems to their proper remedies.
Grounds for cancellation of patents:
a. That what is claimed as the invention is not new or
patentable;
b. That the patent does not disclose the invention in a
manner sufficiently clear and complete for it to be
carried out by any person skilled in the art; or
c. That the patent is contrary to public order or morality.
It should be noted that during the cancellation proceedings,
the patent owner may make amendments to remedy the
problem.
The rights conferred by the patent or any specified claim or
claims cancelled shall terminate. Notice of the cancellation shall
be published in the IPO Gazette. Unless restrained by the
Director General, the decision or order to cancel by Director of
Legal Affairs shall be immediately executory even pending
appeal.
The IPC is silent as to the prescriptive period, but it is
believed that it must be filed within the term of the patent.
2. Patent Application by Persons Not Having the Right to a
Patent
Earlier, we talked about the First to File Rule which is
applied where there are two applications for a single invention.
Necessarily, only one will prevail. So, this remedy is applied
when the prevailing applicant is declared by final court order or
decision as not having the right to a patent.
The person declared as having the right to the patent may
within three (3) months after the decision has become final:
a. Prosecute the applicant as his own application in place
of the applicant;
b. File a new patent application in respect of the same
invention;
c. Request that the application be refused;
d. Seek cancellation of the patent, if one has already been
issued.
Must be filed within one (1) year from the date of first
publication under Sec. 44.
3. Remedies of the True and Actual Inventor/Petition for
Substitution
This remedy is applied if a person was deprived of the patent
without his consent or through fraud is declared by final court
or decision to be the true and actual inventor. In such case, the
court shall order for his substitution as patentee, or at the option
of the true inventor, cancel the patent, and award actual and
other damages in his favor if warranted by the circumstances.
Must be filed within one (1) year from the date of second
publication under Sec. 52.
Q: What are the rights conferred by patent to a patent
holder?
1. Where the subject matter of a patent is a product, to
restrain, prohibit and prevent any unauthorized person or
 entity from making, using, offering for sale, selling or
importing that product;
2. Where the subject matter of a patent is a process, to
restrain, prevent or prohibit any unauthorized person or
entity from using the process, and from manufacturing,
dealing in, using, selling or offering for sale, or importing
any product obtained directly or indirectly from such
process.
3. Patent owners shall also have the right to assign, or transfer
by succession the patent, and to conclude licensing
contracts for the same.
Q: What are the limitations of patent rights?
The patent holder has no right to prevent third parties from
performing, without his authorization, the acts referred to in
Sec. 71 (rights conferred by patent) in the following cases:
1. Using a patented product which has been put on the market
in the Philippines by the owner of the product, or with his
express consent, insofar as such use is performed after that
product has been so put on the said market. With regard to
drugs and medicines, the limitation on patent rights shall
apply after a drug or medicine has been introduced in the
Philippines or anywhere else in the world by the patent
owner, or by any party authorized to use the invention. The
right to import the drugs and medicines contemplated in
this section shall be available to any government agency or
any private third party;
2. Where the act is done privately and on a non-commercial
scale or for a non-commercial purpose: Provided, That it
does not significantly prejudice the economic interests of
the owner of the patent;
3. Where the act consists of making or using exclusively for
the purpose of experiments that relate to the subject matter
of the patented invention;
4. Where the act consists of the preparation for individual
cases, in a pharmacy or by a medical professional, of a
medicine in accordance with a medical prescription or acts
concerning the medicine so prepared;
5. Where the invention is used in any ship, vessel, aircraft, or
land vehicle of any other country entering the territory of
the Philippines temporarily or accidentally: Provided, That
such invention is used exclusively for the needs of the ship,
vessel, aircraft, or land vehicle and not used for the
manufacturing of anything to be sold within the Philippines.
Q: Discuss the concept of Prior User.
Any prior user, who, in good faith was using the invention or
has undertaken serious preparations to use the invention in his
enterprise or business, before the filing date or priority date of
the application on which a patent is granted, shall have the right
to continue the use thereof as envisaged in such preparations
within the territory where the patent produces its effect.
The right of the prior user may only be transferred or
assigned together with his enterprise or business, or with that
part of his enterprise or business in which the use or
preparations for use have been made.
Q: When can the government exploit the invention even
without an agreement with the patent owner?
1. The public interest, in particular, national security, nutrition,
health or the development of other sectors, as determined
by the appropriate agency of the government, so requires;
2. A judicial or administrative body has determined that the
manner of exploitation, by the owner of the patent or his
licensee is anti-competitive;
3. In the case of drugs and medicines, there is a national
emergency or other circumstance of extreme urgency
requiring the use of the invention;
4. In the case of drugs and medicines, there is public non-
commercial use of the patent by the patentee, without
satisfactory reason; or
5. In the case of drugs and medicines, the demand for the
patented article in the Philippines is not being met to an
adequate extend and on reasonable term, as determined
by the Secretary of Department of Health.
Q: Define patent infringement.
The making, using, offering for sale, selling, or importing a
patented product or a product obtained directly or indirectly
from a patented process, or the use of a patented process
without the authorization of the patentee constitutes patent
infringement.
Q: Enumerate and explain the tests to establish patent
infringement.
1. Literal Infringement In using this test, resort must first be
had to the words of the claim. The patented product and
accused/infringed product must be juxtaposed to determine
whether there is exact identity of all material elements.
2. Doctrine of Equivalents It provides that an infringement
takes place when a device appropriates a prior invention by
incorporating its innovative concept and, although with some
modification and change, performs substantially the same
function in substantially the same way to achieve substantially
the same result.
The Doctrine of Equivalents requires satisfaction of the
function-means-and-result test, the patentee having the burden
to show that all three components of such equivalency test are
met.
Q: What are the defenses that can be raised in an
infringement suit?
1. The patent is invalid (Sec. 81);
2. The patent is not new or patentable (Sec. 61);
3. The patent does not disclose the invention in a manner
sufficiently clear and complete for it to be carried out by a
person skilled in the art (Sec. 61); and
4. The patent was issued to one who was not the true and
actual inventor (Sec. 68)
Q: Harvey is a patent holder for a jetpack. Mike wants to
sell those jetpack. What must Mike do?
Mike may execute a voluntary license contract with Harvey
whereby Mike will be granted certain commercial rights over the
jetpack. Harvey, in return, is entitled to payment of royalties.
A voluntary license contract is a form of technology transfer.
The Director of the Documentation, Information and Technology
Transfer Bureau shall exercise quasi-judicial jurisdiction in the
settlement of disputes between parties to a technology transfer
arrangement arising from technology transfer payments,
including the fixing of appropriate amount or rate of royalty.
Q: What are the prohibited clauses in a voluntary license
contract for being deemed prima facie to have an
adverse effect on competition and trade?
1. Those which impose upon the licensee the obligation to
acquire from a specific source capital goods, intermediate
products, raw materials, and other technologies, or of
permanently employing personnel indicated by the licensor;
2. Those pursuant to which the licensor reserves the right to
fix the sale or resale prices of the products manufactured
on the basis of the license;
3. Those that contain restrictions regarding the volume and
structure of production;
4. Those that prohibit the use of competitive technologies in a
non-exclusive technology transfer agreement;
5. Those that establish a full or partial purchase option in favor
of the licensor;
6. Those that obligate the licensee to transfer for free to the
licensor the inventions or improvements that may be
obtained through the use of the licensed technology;
7. Those that require payment of royalties to the owners of
patents for patents which are not used;
8. Those that prohibit the licensee to export the licensed
product unless justified for the protection of the legitimate
interest of the licensor such as exports to countries where
exclusive licenses to manufacture and/or distribute the
licensed product(s) have already been granted;
9. Those which restrict the use of the technology supplied
after the expiration of the technology transfer arrangement,
except in cases of early termination of the technology
transfer arrangement due to reason(s) attributable to the
licensee;
10. Those which require payments for patents and other
industrial property rights after their expiration, termination
arrangement;
11. Those which require that the technology recipient shall not
contest the validity of any of the patents of the technology
supplier;
12. Those which restrict the research and development
activities of the licensee designed to absorb and adapt the
transferred technology to local conditions or to initiate
research and development programs in connection with
new products, processes or equipment;
13. Those which prevent the licensee from adapting the
imported technology to local conditions, or introducing
innovation to it, as long as it does not impair the quality
standards prescribed by the licensor;
14. Those which exempt the licensor for liability for non-
fulfilment of his responsibilities under the technology
transfer arrangement and/or liability arising from third party
suits brought about by the use of the licensed product or
the licensed technology; and
15. Other clauses with equivalent effects. 3
Q: What are the mandatory provisions in a voluntary
license contract?
1. That the laws of the Philippines shall govern the
interpretation of the same and in the event of litigation,
3Too many and hard to memorize. Lucky there is a catch-all item here. As a
yardstick, if the clause seems unfair to standard trading practices, then it is
most likely prohibited.
Also, these prohibitions are not absolute. In exceptional or meritorious cases
where substantial benefits will accrue to the economy, such as high
technology content, increase in foreign exchange earnings, employment
the venue shall be the proper court in the place where
the licensee has its principal office;
2. Continued access to improvements in techniques and
processes related to the technology shall be made
available during the period of the technology transfer
arrangement;
3. In the event the technology transfer arrangement shall
provide for arbitration, the Procedure of Arbitration of
the Arbitration Law of the Philippines or the Arbitration
Rules of the United Nations Commission on
International Trade Law (UNCITRAL) or the Rules of
Conciliation and Arbitration of the International
Chamber of Commerce (ICC) shall apply and the venue
of arbitration shall be the Philippines or any neutral
country; and
4. The Philippine taxes on all payments relating to the
technology transfer arrangement shall be borne by the
licensor.
Q: Do you need to register a voluntary license contract
with the Documentation, Information and Technology
Transfer Bureau?
It depends. If the contract complies with requirements of
Sections 86 and 87 (prohibited and mandatory provisions), then
there is no need for registration. Non-conformance with any of
the said provisions shall automatically render the technology
transfer arrangement unenforceable, unless said technology
transfer arrangement is approved and registered under the
provisions of Sec. 91 (Exceptional Cases). See footnote below.
Q: What are the grounds for which the Director of Legal
Affairs may grant a compulsory licensing agreement?
1. National emergency or other circumstances of extreme
urgency;
2. Where the public interest, in particular, national security,
nutrition, health or the development of other vital sectors
of the national economy as determined by the appropriate
agency of the Government, so requires; or
3. Where a judicial or administrative body has determined that
the manner of exploitation by the owner of the patent or
his licensee is anti-competitive;
4. In case of public non-commercial use of the patent by the
patentee, without satisfactory reason;
5. If the patented invention is not being worked in the
Philippines on a commercial scale, although capable of
being worked, without satisfactory reason: Provided, That
the importation of the patented article shall constitute
working or using the patent.
For this ground, a compulsory may not be applied for
before the expiration of a period of four (4) years
from the date of filing of the application of three (3)
years from the date of the patent whichever period
expires last. For the rest of the grounds, anytime!
6. Where the demand for patented drugs and medicines is not
being met to an adequate extent and on reasonable terms,
generation, regional dispersal of industries and/or substitution with or use of
local raw materials, or in the case of Board of Investments, registered
companies with pioneer status, exemption from any of the above
requirements may be allowed by the Documentation, Information and
Technology Transfer Bureau after evaluation thereof on a case by case basis.
(Sec. 91)
as determined by the Secretary of the Department of
Health.