COMMERCIAL LAW REVIEW

(INTELLECTIAL PROPERTY)

Instructions: Answer the following questions briefly and legibly. Answers should be
submitted on or before 14 May 2020. Please make sure that you submit your papers
on time.

IV. INTELLECTUAL PROPERTY

A. Intellectual property rights in general

1. Define “Intellectual property rights”

Section 4 of Republic Act No. 8293 provides that the intellectual property
rights has a statutory definition as that consisting of:
a) Copyright and Related Rights;
b) Trademarks and Service Marks;
c) Geographic Indications;
d) Industrial Design;
e) Patents;
f) Layout Designs (Topographies) of Integrated Circuits; and
g) Protection of Undisclosed Information.

2. Distinguish copyright, trademarks, and patents from each other.

Jurisprudence and law defined Copyright as a right over literary and

artistic works which are original intellectual creations in the literary and artistic
domain protected from the moment of their creation.

While, Trademark is any visible sign capable of distinguishing the goods

(trademark) or services (service mark) of an enterprise and shall include a
stamped or marked container of goods.

And on the other hand Patents is Any technical solution of a problem in

any field of human activity which is new, involves an inventive step and is
industrially applicable.

The Court further elaborate such in the case of Pearl & Dean
(Philippines), Inc. vs. Shoemart, Inc. wherein it states that Trademark, Copyright
and Patents are different intellectual property rights that cannot be
interchanged with one another. A Trademark is any visible sign capable of
distinguishing the goods (trademark) or services (service mark) of an enterprise

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and shall include a stamped or marked container of goods. In relation thereto, a
trade name means the name or designation identifying or distinguishing an
enterprise. Meanwhile, the scope of a copyright is confined to literary and
artistic works which are original intellectual creations in the literary and artistic
domain protected from the moment of their creation. Patentable inventions, on
the other hand, refer to any technical solution of a problem in any field of
human activity which is new, involves an inventive step and is industrially
applicable.

3. What is a “technology transfer arrangement”?

Under Section 4.2 of the Intellectual Property Code, technology transfer

arrangements are contracts or arrangements involving the transfer of
systematic knowledge for the manufacture of a product, the application of the
process, or rendering a service including management contracts, and transfer,
assignment or licensing of all forms of intellectual property rights, including
licensing of computer software except computer software developed for mass
market.

B. Patents

1. What consists of a “patentable invention”?

It refers to any technical solution of a problem in any field of human

activity which is new, involves an inventive step and is industrially applicable. It
may be, or may relate to, a product, or process, or an improvement of any of
the foregoing. Hence, the requisites to be considered as patentable invention
are as follows:
(a.) A technical solution of a problem in any field of human activity;
(b.) It must be a novel invention; and
(c.) Industrially applicable.

2. What are non-patentable inventions?

The Non-patentable inventions are the following:

(a.) Discoveries, scientific theories and mathematical methods;

(b.) In the case of Drugs and medicines, there is no patentable
invention in the following instances:
(i.) mere discovery of a new form or new property of a
known substance which does not result in the

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 enhancement of the known efficacy of that
substance;
(ii.) Mere discovery of any new property or new use for
a known substance;
(iii.) Mere use of a known process unless such known
process results in a new product that employs at
least one new reactant
(c.) Schemes, rules and methods of performing mental acts, playing
games or doing business, and programs for computers;
(d.) Methods for treatment of the human body or animal body by
surgery of therapy and diagnostic methods practiced on the
human or animal body;
(e.) 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;
(f.) Aesthetic creations; and
(g.) Anything which is Contrary to public order or morality.

3. As to ownership of a patent,

a. what is meant by right to a patent?

The right to patent belongs to the inventor, his heirs or assigns. When two or
more persons jointly made an invention, the right to patent shall belong to them
jointly.

b. Explain the “first-to-file rule”?

The first to file rule means that if two or more persons have made the
invention separately and independently of each other, the right to patent shall
belong to the person who first filed the application for such invention.

c. What is the rule in case of an invention created pursuant to a

commission?

In cases where invention is made in pursuant to a commission, the person

who commissions the work shall be the owner of the patent unless there was an
agreement to the contrary.

d. Discuss the right of priority.

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 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 citizen shall be considered filed as of the date of filing
in the foreign application. Provided that:
(a.) the local application expressly claims priority;
(b.) it is filed within 12 months from the date the earliest foreign
application was filed; and
(c.) a certified true copy of the foreign application together with the
English translation is filed within six months form the date of filing
in
the Philippines.

4. What are the grounds for cancellation of a patent and briefly discuss
each.

Section 61 of the Intellectual Property Code provides that any interested

person may, upon payment of the required fee, petition to cancel the patent or any
claim thereof, or parts of the claim, on any of the following grounds:

(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.

5. What are the remedies of the true and actual inventor in case
someone had it first registered?

Section 68 of the Intellectual Property Code specifically states that if a

person, who was deprived of the patent without his consent or through fraud is
declared by final court order or decision to be the true and actual inventor, 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.

6. What are the rights conferred by a patent?

The rights conferred by a patent are as follows:

(a.) If the subject matter is a product, Right to restrain, prohibit and
prevent any unauthorized person or entity from making, using,
offering for sale, selling or importing the product;
(b.) If the subject matter is a process, Right to restrain prohibit and
prevent any unauthorized person or entity from manufacturing,

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 dealing in, using, offering for sale, selling or importing any product
obtained directly or indirectly from such process.
(c.) Right to assign the patent, to transfer by succession, and to conclude
licensing contracts.

7. As to the limitations of patent rights,

a. explain what is meant by a “prior user”?

Prior user is a person other than the applicant, who in good faith, started
using the invention in the Philippines, or undertaken serious preparations to use
the same, before the filing date or priority date of the application shall have the
right to continue the use thereof, but this right shall only be transferred or
assigned further with his enterprise or business.

b. how is a patent right limited by the use by the government?

A government agency or third person authorized by the government may

exploit invention even without agreement of a patent owner where:
(a.) Public interest, as determined by the appropriate agency of the
government, so requires; or
(b.) A judicial or administrative body has determined that the manner
of exploitation by owner of patent is anti‐competitive.

8. Patent infringement

Patent Infringement is 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.

a. Explain the tests in patent infringement:

i. Literal infringement

Resort must be had, in the first instance, to words of the claim. If the
accused matter clearly falls within the claim, infringement is committed. Minor
modifications are sufficient to put the item beyond literal infringement.

Furthermore, there is infringement of patent under this test if one makes,

uses or sells an item that contains all the elements of the patent claim. This test
is satisfied in either of the following:

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 (1.) Exactness rule. The item that is being sold, made or used
conforms exactly to the patent claim of another;
(2.) Addition rule. One makes, uses, or sells an item that has all
the elements of the patent claim of another plus other
elements.

The Court reiterated in Pascual Godines v. Court of Appeals, Tests have

been established to determine infringement. These are (a) literal infringement;
and (b) the doctrine of equivalents. In using literal infringement as a test "resort
must be had, in the first instance, to the words of the claim. If accused matter
clearly falls within the claim, infringement is made out and that is the end of it."
To determine whether the particular item falls within the literal meaning of the
patent claims, the Court must juxtapose the claims of the patent and the
accused product within the overall context of the claims and specifications, to
determine whether there is exact identity of all material elements.

ii. Doctrine of equivalents

There is infringement where 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.
In other words, the principle or mode of operation must be the same
substantially the same. The doctrine of equivalents thus 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.

b. What actions can be filed in case of infringement of patent?

Briefly explain each.

Actions that can be files in case of infringement of patent are to wit:

(1.) Civil action for infringement wherein the owner may bring a civil
action with the appropriate Regional Trial Court to recover from
infringer the damages sustained by the former, plus attorney’s fees
and other litigation expenses, and to secure an injunction for the
protection of his rights;
(2.) Criminal action for infringement. If the infringement is repeated, the
infringer shall be criminally liable and upon conviction, shall suffer
imprisonment of not less than six (6) months but not more than three
(3) years and/or a fine not less than P100,000.00 but not more than
P300,000.00; and/or
(3.) Administrative remedy. Where the amount of damages claimed is not
less than P200,000.00, the patentee may choose to file an
administrative action against the infringer with the Bureau of Legal
Affairs (BLA). The BLA can issue injunctions, direct infringer to pay

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 patentee damages, but unlike regular courts, the BLA may not issue
search and seizure warrants or warrants of arrest.

c. What is the prescriptive period for filing infringement suit?

Section 79 of the Intellectual Property Codes provides that no damages

can be recovered for acts of infringement committed more than four (4) years
before the institution of the action for infringement.

d. What are the defenses in an action for infringement?

In an action for infringement, the defendant, in addition to other defenses

available to him, may show the invalidity of the patent, or any claim thereof, on
any grounds on which a petition of cancellation can be brought under Section
61 of the Intellectual Property Code.

9. Distinguish Voluntary Licensing from Compulsory licensing.

Voluntary Licensing is the grant by the patent owner to a third person of

the right to exploit a patented invention while compulsory licensing covers
situation where license is awarded against the will of the patent owner.

10. Explain the assignment and transmission of patent rights.

Assignment and transmission of patent right may be total or partial. Total

as to assign the entire right or interest in and to the patent and the invention
covered thereby. Partial as to assign specific right like right to sell and
assignment of aliquot part which result into co-ownership

11. Provide a case digest for the following:

a. Pearl & Dean [Phil.] v. Shoemart, Inc., et. al.,
G.R. No. 148222, August 15, 2003.

Facts:

Pearl and Dean is a corporation engaged in the manufacture of

advertising display units referred to as light boxes and these light boxes were
marketed under the trademark Poster Ads. Pearl and Dean entered into a
contract with Shoemart, Inc. for the lease and installation of the light boxes in
SM North Edsa. However, due to construction constraints, Shoemart, Inc offered
as an alternative SM Makati and SM Cubao.
After Pearl and Dean’s contract was rescinded, exact copies of its light
boxes were installed in various SM malls, fabricated by Metro Industrial Services

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and later by EYD Rainbow Advertising Corporation. Pearl and Dean sent a letter
to Shoemart and its sister company, North Edsa Marketing to cease using the
light boxes and to remove them from the malls, and demanded the
discontinued used of the trademark “Poster Ads”.
Unsatisfied with the compliance of its demands, Pearl and Dean sued
Shoemart which was ruled by the trial court in their favor. On appeal, however,
the Court of Appeals reversed the trial court’s decision.

Issue: Whether there is Trademark Infringement

Held:

No. This issue concerns the use by respondents of the mark "Poster Ads"
which petitioner’s president said was a contraction of "poster advertising." P &
D was able to secure a trademark certificate for it, but one where the goods
specified were "stationeries such as letterheads, envelopes, calling cards and
newsletters." Petitioner admitted it did not commercially engage in or market
these goods. On the contrary, it 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. Under the circumstances, the Court of
Appeals correctly cited Faberge Inc. vs. Intermediate Appellate Court, where we,
invoking Section 20 of the old Trademark Law, ruled that "the certificate of
registration issued by the Director of Patents can confer (upon petitioner) 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 x
x x. 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."
Faberge, Inc. was correct and was in fact recently reiterated in Canon
Kabushiki Kaisha vs. Court of Appeals. Assuming arguendo that "Poster Ads"
could validly qualify as a trademark, 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.

b. Smith Kline Beckman Corp. v. The Honorable CA,

G.R. No. 126627, August 14, 2003.

Facts:

Smith Kline Beckman Co., licensed to do business in the Philippines, filed

on October 8, 1976 as assignee before the Bureau of Patents an application for
patent on its invention called “Methods and Compositions for Producing
Biphasic Parasiticide Activity Using Methyl 5 Propylthio-2-Benzimidazole
Carbanate.” A Letters of Patent was issued to the petitioner on September 24,
1981 for a period of 17 years. The patent provides that the patented invention
consists of Methyl 5 Propylthio-2-Benzimidazole Carbanate used as an active

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ingredient in treating gastrointestinal parasites and lung worms in animals. The
respondent Tryco Pharma manufactures, distributes and sells veterinary
product, one of which is the Impregon, a drug having Albendazole as its active
ingredient effective against gastrointestinal worms in animals.
Petitioner now sues the respondent for patent infringement and unfair
competition before the RTC as it claims that their patent includes the substance
Albendazole used by the respondent and they sold and used the drug Impregon
without the petitioner’s authorization and committed unfair competition for
selling as its own the drug that substantially functions to achieve the same
result. Petitioner further contends that under the doctrine of equivalents in
determining patent infringement, the active substance Albendazole used by the
respondent is substantially the same as Methyl 5 Propylthio-2-Benzimidazole
Carbanate covered by its patent with the same use of combating worm
infestations in animals. It prodded the court to go beyond the literal words used
in the Letter of Patent issued to them to consider that the words Methyl 5
Propylthio-2-Benzimidazole Carbanate and Albendazole are the same.
Respondent avers that the Letter of Patents issued to petitioner does not cover
Albendazole in that the word does not appear on it. Even if the patent were to
include Albendazole it is unpatentable. They secured approval from the Bureau
of Foods and Drugs to manufacture and market Impregon with the Albendazole
as its active ingredients. The petitioner has no proof that they passed their
veterinary products as that of the petitioner.
Issue: Whether or not the private respondent committed patent infringement
Held:
No. When the language of the claim is clear and distinct, the patentee is
bound thereby and may not claim anything beyond them. The language of the
Letter of Patents issued to the petitioner failed to yield anything that it includes
Albendazole. The doctrine of equivalents does not apply in the case at bar
because it requires that for infringement to take place, the device should
appropriate a prior invention by incorporating its innovative concept and
although there are some modifications and change they perform substantially
the same results. The petitioner’s evidence failed to adduce that substantial
sameness on both the chemicals they used. While both compounds produce the
same effects of neutralizing parasites in animals, the identity of result does not
amount to infringement. The petitioner has the burden to show that it satisfies
the function-means-and-result-test required by the doctrine of equivalents.
Nothing has been substantiated on how Albendazole can weed the parasites out
from animals which is similar to the manner used by the petitioner in using their
own patented chemical compound.

C. Trademarks
1. Define the following:

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 a. Trade mark
A distinctive mark of authenticity through which the merchandise of a
particular producer or manufacturer may be distinguished from that of others,
and its sole function is to designate distinctively the origin of the products to
which it is attached.

b. Collective mark
A "collective mark" or collective trade‐name" is a mark or trade‐name
used by the members of a cooperative, an association or other collective group
or organization.

c. Trade names
A trade name is a name or designation identifying or distinguishing an
enterprise. It is any individual name or surname, firm name, device nor word
used by manufacturers, industrialists, merchants, and others to identify their
businesses, vocations or occupants

2. How is ownership of mark acquired?

Under Section 122 of the Intellectual Property Code, the rights in a mark
shall be acquired through registration made validly in accordance with the
provisions of this law.

3. How is ownership of trade name acquired?

Section 165 of the Intellectual Property Code states that a name or

designation may not be used as a trade name if by its nature or the use to
which such name or designation may be put, it is contrary to public order or
morals and if, in particular, it is liable to deceive trade circles or the public as to
the nature of the enterprise identified by that name.
Trade names or business names are acquired through adoption and use.
Hence, Registration is not required.

4. What are non-registrable marks?

Section 123 of the Intellectual Property Law enumerates marks that

cannot be registered such as the following:
(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;

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 (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

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 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.

5. Explain the concept of prior use of mark as a requirement.

Actual prior use in commerce in the Philippines has been abolished as a

condition for the registration of a trademark. Thus, prior use of mark is already
not required.
Furthermore, Non-used is excused when:
(a.) it is caused by circumstances arising independently of the
will of
the owner. Lack of funds is not an excuse.
(b.) A use which does not alter its distinctive character though
the
use is different from the form in which it is registered.
(c.) Use of mark in connection with one or more of the
goods/services belonging to the class in which the mark is
registered.
(d.) The use of a mark by a company related to the
applicant/registrant.
(e.) The use of a mark by a person controlled by the registrant.

6. Explain briefly the following tests to determine confusing similarity

between marks:

a. Dominancy test:
Dominancy test, Focuses on the similarity of the prevalent features of the
competing marks. If the competing trademark contains the main or essential or
dominant features of another, and confusion is likely to result, infringement
takes place.
Hence, in the case of Berris Agricultural Co., Inc. v. Norvy Abyadang, The
Dominancy Test focuses on the similarity of the prevalent or dominant features
of the competing trademarks that might cause confusion, mistake, and
deception in the mind of the purchasing public. Duplication or imitation is not
necessary; neither is it required that the mark sought to be registered suggests
an effort to imitate. Given more consideration are the aural and visual
impressions created by the marks on the buyers of goods, giving little weight to
factors like prices, quality, sales outlets, and market segments.

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 Moreover, in Philip Morris, Inc. vs. Fortune Tobacco Corporation, the
dominancy test sets sight on the similarity of the prevalent features of the
competing trademarks that might cause confusion and deception, thus
constitutes infringement. Under this norm, the question at issue turns on
whether the use of the marks involved would be likely to cause confusion or
mistake in the mind of the public or deceive purchasers.

b. Holistic test
In Totality or holistic test, confusing similarity is to be determined on the
basis of visual, aural, connotative comparisons and overall impressions
engendered by the marks in controversy as they are encountered in the
marketplace.
In the case of McDonald’s Corporation vs. Macjoy Fastfood Corporation,
the holistic test requires the court to consider the entirety of the marks as
applied to the products, including the labels and packaging, in determining
confusing similarity. A comparison of the words is not the only determinant
factor.

d. Idem sonans
Idem sonan is a Latin for “sounding the same” or “same item”. The rule
on idem sonan is also a test to resolve the confusing similarity of trademarks. A
mark with a different spelling but is similar in sound with a registered mark
when read, may be ruled as being confusingly-similar with the said registered
mark or senior mark.
Hence, In Marvex Commercial Co., Inc. v. Petra Hawpia & Co., et al., cited
in McDonald's Corporation v. L.C. Big Mak Burger, Inc.,the Court held:
The following random list of confusingly similar sounds in the matter of
trademarks, culled from Nims, Unfair Competition and Trade Marks, 1947, Vol.
1, will reinforce our view that "SALONPAS" and "LIONPAS" are confusingly
similar in sound: "Gold Dust" and "Gold Drop"; "Jantzen" and "Jass-Sea"; "Silver
Flash" and "Supper Flash"; "Cascarete" and "Celborite"; "Celluloid" and
"Cellonite"; "Chartreuse" and "Charseurs"; "Cutex" and "Cuticlean"; "Hebe" and
"Meje"; "Kotex" and "Femetex"; "Zuso" and "Hoo Hoo." Leon Amdur, in his book
"Trade-Mark Law and Practice," pp. 419-421, cities, as coming within the
purview of the idem sonans rule, "Yusea" and "U-C-A," "Steinway Pianos" and
"Steinberg Pianos," and "Seven-Up" and "Lemon-Up." In Co Tiong v. Director of
Patents, this Court unequivocally said that "Celdura" and "Cordura" are
confusingly similar in sound; this Court held in Sapolin Co. v. Balmaceda, 67
Phil. 795 that the name "Lusolin" is an infringement of the trademark "Sapolin,"
as the sound of the two names is almost the same.

i. Provide a case analysis for:

1. Seri Somboonsakdikul v. Orlane S.A.

G.R. No. 188996, February 1, 2017.

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 The petitioner in this case filed an application for registration of the mark
LOLANE with the IPO for goods classified under Class 3 (personal care products)
of the International Classification of Goods. However, the Court ruled that there
is no colorable imitation between the marks LOLANE and ORLANE which would
lead to any likelihood of confusion to the ordinary purchasers. Hence, the mark
LOLANE is entitled to registration. Based on the distinct visual and aural
differences between LOLANE and ORLANE, the Court find that there is no
confusing similarity between the two marks. The suffix LANE is not the dominant
feature of petitioner's mark. Neither can it be considered as the dominant
feature of ORLANE which would make the two marks confusingly similar.
First, an examination of the appearance of the marks would show that
there are noticeable differences in the way they are written or printed. There
are visual differences between LOLANE and ORLANE since the mark ORLANE is
in plain block upper case letters while the mark LOLANE was rendered in
stylized word with the second letter L and the letter A co-joined.
Second, as to the aural aspect of the marks, LOLANE and ORLANE do not
sound alike. Appeals to the ear in pronouncing ORLANE and LOLANE are
dissimilar. The first syllables of each mark, i.e., OR and LO do not sound alike,
while the proper pronunciation of the last syllable LANE — "LEYN" for LOLANE
and "LAN" for ORLANE, being of French origin, also differ. We take exception to
the generalizing statement of the Director General, which was affirmed by the
CA, that Filipinos would invariably pronounce ORLANE as "ORLEYN." This is
another finding of fact which has no basis, and thus, justifies our reversal of the
decisions of the IPO Director General and the CA. While there is possible aural
similarity when certain sectors of the market would pronounce ORLANE as
"ORLEYN," it is not also impossible that some would also be aware of the proper
pronunciation — especially since, as respondent claims, its trademark ORLANE
has been sold in the market for more than 60 years and in the Philippines, for
more than 40 years. Respondent failed to show proof that the suffix LANE has
registered in the mind of consumers that such suffix is exclusively or even
predominantly associated with ORLANE products. Notably and as correctly
argued by petitioner, the IPO previously allowed the registration of the mark
GIN LANE for goods also falling under Class 3, i.e. perfume, cologne, skin care
preparations, hair care preparations and toiletries.

2. UFC Phils, v. Barrio Fiesta, Mfg.

G.R. No. 198889, January 20, 2016.

Respondent filed Application No. 4-2002-002757 for the mark "PAPA BOY
& DEVICE" for goods under Class 30, specifically for "lechon sauce." The
Intellectual Property Office (IPO) published said application for opposition in the
IP Phil. e-Gazette released on September 8, 2006. Petition filed an opposition to
his application. In its verified opposition before the IPO, petitioner contended
that "PAPA BOY & DEVICE" is confusingly similar with its "PAPA" marks inasmuch
as the former incorporates the term "PAPA," which is the dominant feature of
petitioner's "PAPA" marks. Petitioner averred that respondent's use of "PAPA
BOY & DEVICE" mark for its lechon sauce product, if allowed, would likely lead
the consuming public to believe that said lechon sauce product originates from

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or is authorized by petitioner, and that the "PAPA BOY & DEVICE" mark is a
variation or derivative of petitioner's "PAPA" marks. Petitioner argued that this
was especially true considering that petitioner's ketchup product and
respondent's lechon sauce product are related articles that fall under the same
Class 30.
Hence, in this case the Court has relied on the dominancy test rather
than the holistic test. The dominancy test considers the dominant features in
the competing marks in determining whether they are confusingly similar.
Under the dominancy test, courts give greater weight to the similarity of the
appearance of the product arising from the adoption of the dominant features of
the registered mark, disregarding minor differences. Courts will consider more
the aural and visual impressions created by the marks in the public mind, giving
little weight to factors like prices, quality, sales outlets and market segments.
The Court agreed that respondent's mark cannot be registered.
Respondent's mark is related to a product, lechon sauce, an everyday all-
purpose condiment and sauce, that is not subjected to great scrutiny and care
by the casual purchaser, who knows from regular visits to the grocery store
under what aisle to find it, in which bottle it is contained, and approximately
how much it costs. Since petitioner's product, catsup, is also a household
product found on the same grocery aisle, in similar packaging, the public could
think that petitioner had expanded its product mix to include lechon sauce, and
that the "PAPA BOY" lechon sauce is now part of the "PAPA" family of sauces,
which is not unlikely considering the nature of business that petitioner is in.
Thus, if allowed. registration, confusion of business may set in, and petitioner's
hard-earned goodwill may be associated to the newer product introduced by
respondent, all because of the use of the dominant feature of petitioner's mark
on respondent's mark, which is the word "PAPA."
The words "Barrio Fiesta" are not included in the mark, and although
printed on the label of respondent's lechon sauce packaging, still do not remove
the impression that "PAPA BOY" is a product owned by the manufacturer of
"PAPA" catsup, by virtue of the use of the dominant feature. It is possible that
petitioner could expand its business to include lechon sauce, and that would be
well within petitioner's rights, but the existence of a "PAPA BOY" lechon sauce
would already eliminate this possibility and deprive petitioner of its rights as an
owner of a valid mark included in the Intellectual Property Code.
The Court of Appeals likewise erred in finding that "PAPA," being a
common term of endearment for one's father, is a word over which petitioner
could not claim exclusive use and ownership. The Merriam-Webster dictionary
defines "Papa" simply as "a person's father." True, a person's father has no
logical connection with catsup products, and that precisely makes "PAPA" as an
arbitrary mark capable of being registered, as it is distinctive, coming from a
family name that started the brand several decades ago. What was registered
was not the word "Papa" as defined in the dictionary, but the word "Papa" as
the last name of the original owner of the brand. In fact, being part of several of
petitioner's marks, there is no question that the IPO has found "PAPA" to be a
registrable mark.

3. Mighty Corporation v. E&J Gallo

G.R. No. 154342, July 14, 2004

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 Respondent domestic corporation, Andresons, has been Gallo Winery’s
exclusive wine importer and distributor in the Philippines since 1991, selling
these products in its own name and for its own account. On the other hand,
petitioners Mighty Corporation and La Campana and their sister company,
Tobacco Industries of the Philippines (Tobacco Industries), are engaged in the
cultivation, manufacture, distribution and sale of tobacco products for which
they have been using the GALLO cigarette trademark since 1973. Respondent
claimed that petitioners adopted the GALLO trademark to ride on Gallo Winery’s
GALLO and ERNEST & JULIO GALLO trademarks’ established reputation and
popularity, thus causing confusion, deception and mistake on the part of the
purchasing public who had always associated GALLO and ERNEST & JULIO
GALLO trademarks with Gallo Winery’s wines.
Confusion of goods is evident where the litigants are actually in
competition; but confusion of business may arise between non-competing
interests as well. Thus, apart from the strict application of Section 20 of the
Trademark Law and Article 6bis of the Paris Convention which proscribe
trademark infringement not only of goods specified in the certificate of
registration but also of identical or similar goods, we have also uniformly
recognized and applied the modern concept of "related goods. "Simply stated,
when goods are so related that the public may be, or is actually, deceived and
misled that they come from the same maker or manufacturer, trademark
infringement occurs. Non-competing goods may be those which, though they
are not in actual competition, are so related to each other that it can reasonably
be assumed that they originate from one manufacturer, in which case,
confusion of business can arise out of the use of similar marks. They may also
be those which, being entirely unrelated, cannot be assumed to have a common
source; hence, there is no confusion of business, even though similar marks are
used. Thus, there is no trademark infringement if the public does not expect the
plaintiff to make or sell the same class of goods as those made or sold by the
defendant.
Hence, in the adjudication of trademark infringement, we give due regard
to the goods’ usual purchaser’s character, attitude, habits, age, training and
education. Applying these legal precepts to the present case, petitioner’s use of
the GALLO cigarette trademark is not likely to cause confusion or mistake, or to
deceive the "ordinarily intelligent buyer" of either wines or cigarettes or both as
to the identity of the goods, their source and origin, or identity of the business
of petitioners and respondents. Obviously, wines and cigarettes are not identical
or competing products. Neither do they belong to the same class of goods.
Respondents’ GALLO wines belong to Class 33 under Rule 84[a] Chapter III, Part
II of the Rules of Practice in Trademark Cases while petitioners’ GALLO
cigarettes fall under Class 34.
We are mindful that product classification alone cannot serve as the
decisive factor in the resolution of whether or not wines and cigarettes are
related goods. Emphasis should be on the similarity of the products involved
and not on the arbitrary classification or general description of their properties
or characteristics. But the mere fact that one person has adopted and used a
particular trademark for his goods does not prevent the adoption and use of the
same trademark by others on articles of a different description. All told, after
applying all the tests provided by the governing laws as well as those

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recognized by jurisprudence, we conclude that petitioners are not liable for
trademark infringement, unfair competition or damages.

4. Foriertrans Manufacturing Corp. v. Davidoff

G.R. No. 197482, March 6, 2017

BPI reported to respondents that "there were counterfeit Davidoff and JTI
products, or products bearing colorable imitation of Davidoff and TTI products,
or which are confusingly or deceivingly similar to Davidoff and JTI registered
trademarks, being manufactured and stored" in FMC's warehouses.
Hence, The Courts ruled that the records show that a prima facie case for
trademark infringement and false designation of origin exists against
petitioners. Respondents alleged in their Complaint-Affidavit that petitioners
illegally manufactured and/or stored cigarettes bearing the "DAGETA" label with
an indication that these cigarettes were made in Germany even if they were
actually processed, manufactured and packed in the premises of FMC. To
support their claim, respondents submitted samples and attached a copy of the
receipt/inventory of the items seized during the August 4, 2004 raid. These
included cigarettes bearing the infringing DAGETA trademark and various
machineries, receptacles, boxes and other paraphernalia used in the
manufacturing and packing of the infringing products.
Petitioners, for their part, disputed respondents' claim and maintained
that the items seized from their warehouse were genuine Dageta and Dageta
International cigarettes imported from Germany. In dismissing the charge,
Secretary Gonzalez ruled that respondents failed to establish the falsity of the
claim indicated in the cigarettes' labels that they were made in Germany
without providing the factual or legal basis for his conclusion. He also brushed
aside the allegations that (1) machines intended for manufacturing cigarettes
and (2) cigarettes' bearing the label "Made in Germany" were found and seized
from FMC's warehouse in the Philippines
To our mind, however, these circumstances are enough to excite the
belief that indeed petitioners were manufacturing cigarettes in their warehouse
here in the Philippines but misrepresenting the cigarettes' origin to be Germany.
The CA, therefore, did not err in reversing the Resolution of the Secretary of
Justice.
5. Dermaline, Inc. v. Myra Pharmaceuticals, Inc.
G.R. No. 190065, August 16 2010.

Dermaline, Inc. filed before the Intellectual Property Office (IPO) an

application for registration of the trademark "DERMALINE DERMALINE, INC.".
Myra Pharmaceuticals, Inc. (Myra) filed a Verified Opposition alleging that the
trademark sought to be registered by Dermaline so resembles its trademark
"DERMALIN" and will likely cause confusion, mistake and deception to the
purchasing public.
Relative to the question on confusion of marks and trade names,
jurisprudence has noted two (2) types of confusion, viz: (1) confusion of goods
(product confusion), where the ordinarily prudent purchaser would be induced
to purchase one product in the belief that he was purchasing the other; and (2)

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confusion of business (source or origin confusion), where, although the goods of
the parties are different, the product, the mark of which registration is applied
for by one party, is such as might reasonably be assumed to originate with the
registrant of an earlier product, and the public would then be deceived either
into that belief or into the belief that there is some connection between the two
parties, though inexistent.
The Court agree with the findings of the IPO. As correctly applied by the
IPO in this case, while there are no set rules that can be deduced as what
constitutes a dominant feature with respect to trademarks applied for
registration; usually, what are taken into account are signs, color, design,
peculiar shape or name, or some special, easily remembered earmarks of the
brand that readily attracts and catches the attention of the ordinary consumer.
Dermaline’s insistence that its applied trademark "DERMALINE DERMALINE,
INC." had differences "too striking to be mistaken" from Myra’s "DERMALIN"
cannot, therefore, be sustained. While it is true that the two marks are
presented differently – Dermaline’s mark is written with the first "DERMALINE"
in script going diagonally upwards from left to right, with an upper case "D"
followed by the rest of the letters in lower case, and the portion "DERMALINE,
INC." is written in upper case letters, below and smaller than the long-hand
portion; while Myra’s mark "DERMALIN" is written in an upright font, with a
capital "D" and followed by lower case letters – the likelihood of confusion is still
apparent. This is because they are almost spelled in the same way, except for
Dermaline’s mark which ends with the letter "E," and they are pronounced
practically in the same manner in three (3) syllables, with the ending letter "E"
in Dermaline’s mark pronounced silently. Thus, when an ordinary purchaser, for
example, hears an advertisement of Dermaline’s applied trademark over the
radio, chances are he will associate it with Myra’s registered mark. Further,
Dermaline’s stance that its product belongs to a separate and different
classification from Myra’s products with the registered trademark does not
eradicate the possibility of mistake on the part of the purchasing public to
associate the former with the latter, especially considering that both
classifications pertain to treatments for the skin.

6. Taiwan Kolin Corp., Ltd. V. Kolins Electronics Co.

G.R. No. 209843, March 25, 2015

Taiwan Kolin filed with the IPO, then BPTTT, a trademark application, for
the use of “KOLIN” on a combination of goods, including colored televisions,
refrigerators, window-type and split-type air conditioners, electric fans and
water dispensers with Taiwan Kolin electing Class 9 as the subject of its
application. Kolin Electronics opposed Taiwan Kolin’s application arguing that
the mark Taiwan Kolin seeks to register is identical, if not confusingly similar,
with its registered “KOLIN” mark covering products under Class 9 of the NCL.
The Court ruled in this case that whether or not the products covered by
the trademark sought to be registered by Taiwan Kolin, on the one hand, and

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those covered by the prior issued certificate of registration in favor of Kolin
Electronics, on the other, fall under the same categories in the NCL is not the
sole and decisive factor in determining a possible violation of Kolin Electronics’
intellectual property right should Taiwan Kolin’s application be granted. It is
hornbook doctrine that emphasis should be on the similarity of the products
involved and not on the arbitrary classification or general description of their
properties or characteristics. The mere fact that one person has adopted and
used a trademark on his goods would not, without more, prevent the adoption
and use of the same trademark by others on unrelated articles of a different
kind. It must be noted that the products covered by Taiwan Kolin’s application
and Kolin Electronics’ registration are unrelated.
A certificate of trademark registration confers upon the trademark owner
the exclusive right to sue those who have adopted a similar mark not only in
connection with the goods or services specified in the certificate, but also with
those that are related thereto. In resolving one of the pivotal issues in this
case––whether or not the products of the parties involved are related––the
doctrine in Mighty Corporation is authoritative. There, the Court held that the
goods should be tested against several factors before arriving at a sound
conclusion on the question of relatedness. Among these are: (a) the business
(and its location) to which the goods belong; (b) the class of product to which
the goods belong; (c) the product’s quality, quantity, or size, including the
nature of the package, wrapper or container; (d) the nature and cost of the
articles; (e) the descriptive properties, physical attributes or essential
characteristics with reference to their form, composition, texture or quality; (f)
the purpose of the goods; (g) whether the article is bought for immediate
consumption, that is, day-today household items; (h) the fields of manufacture;
(i) the conditions under which the article is usually purchased; and (j) the
channels of trade through which the goods flow, how they are distributed,
marketed, displayed and sold.
As mentioned, the classification of the products under the NCL is merely
part and parcel of the factors to be considered in ascertaining whether the
goods are related. It is not sufficient to state that the goods involved herein are
electronic products under Class 9 in order to establish relatedness between the
goods, for this only accounts for one of many considerations enumerated in
Mighty Corporation. Clearly then, it was erroneous for Kolin Electronics to
assume over the CA to conclude that allelectronic products are related and that
the coverage of one electronic product necessarily precludes the registration of
a similar mark over another. In this digital age wherein electronic products have
not only diversified by leaps and bounds, and are geared towards
interoperability, it is difficult to assert readily, as Kolin Electronics simplistically
did, that all devices that require plugging into sockets are necessarily related
goods. As a matter of fact, while both competing marks refer to the word
“KOLIN” written in upper case letters and in bold font, the Court at once notes
the distinct visual and aural differences between them: Kolin Electronics’ mark
is italicized and colored black while that of Taiwan Kolin is white in pantone red
color background. The differing features between the two, though they may
appear minimal, are sufficient to distinguish one brand from the other.
Finally, in line with the foregoing discussions, more credit should be given
to the “ordinary purchaser.” Cast in this particular controversy, the ordinary
purchaser is not the “completely unwary consumer” but is the “ordinarily

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intelligent buyer” considering the type of product involved All told, We are
convinced that Taiwan Kolin’s trademark registration not only covers unrelated
good, but is also incapable of deceiving the ordinary intelligent buyer. The
ordinary purchaser must be thought of as having, and credited with, at least a
modicum of intelligence to be able to see the differences between the two
trademarks in question.

7. What are well-known marks?

According to Section 123 of the Intellectual Property Code, a mark is well-

known:
(a.) if it is considered by the competent authority of the Philippines to
be well-known internationally and in the Philippines and 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.
(b.) if it need not be used or registered in the Philippines
(c.) if need not be known by the public at large but only by relevant
sector of the public.

a. Case analysis
Ecole De Cuisine Manille [Cordon Bleu of the Philippines] Inc.
v. Renau Contreau & Cie,
G.R. No. 185830, June 5, 2013

Cointreau, a partnership registered under the laws of France, filed before

the (now defunct) Bureau of Patents, Trademarks, and Technology Transfer
(BPTTT) of the Department of Trade and Industry a trademark application for
the mark "LE CORDON BLEU & DEVICE" for goods falling under classes 8, 9, 16,
21, 24, 25, 29, and 30 of the International Classification of Goods and Services
for the Purposes of Registrations of Marks ("Nice Classification") (subject mark).
Ecole De Cuisine Manille, Inc. (Ecole) filed an opposition to the subject
application, averring that: (a) it is the owner of the mark "LE CORDON BLEU,
ECOLE DE CUISINE MANILLE," which it has been using since 1948 in cooking and
other culinary activities, including in its restaurant business; and (b) it has
earned immense and invaluable goodwill such that Cointreau’s use of the
subject mark will actually create confusion, mistake, and deception to the
buying public as to the origin and sponsorship of the goods, and cause great
and irreparable injury and damage to Ecole’s business reputation and goodwill
as a senior user of the same.
The instant case was resolved under the provisions of the old Trademark
Law, R.A. No. 166, which was the law in force at the time of Cointreau’s
application for registration of the subject mark. Under Section 2 of R.A. No. 166,
in order to register a trademark, one must be the owner thereof and must have
actually used the mark in commerce in the Philippines for two (2) months prior
to the application for registration. Section 2-A of the same law sets out to define

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how one goes about acquiring ownership thereof. Under Section 2-A, it is clear
that actual use in commerce is also the test of ownership but the provision went
further by saying that the mark must not have been so appropriated by another.
Additionally, it is significant to note that Section 2-A does not require that the
actual use of a trademark must be within the Philippines. Thus, as correctly
mentioned by the CA, under R.A. No. 166, one may be an owner of a mark due
to its actual use but may not yet have the right to register such ownership here
due to the owner’s failure to use the same in the Philippines for two (2) months
prior to registration.
Nevertheless, foreign marks which are not registered are still accorded
protection against infringement and/or unfair competition. At this point, it is
worthy to emphasize that the Philippines and France, Cointreau’s country of
origin, are both signatories to the Paris Convention for the Protection of
Industrial Property (Paris Convention). In the instant case, it is undisputed that
Cointreau has been using the subject mark in France since 1895, prior to Ecole’s
averred first use of the same in the Philippines in 1948, of which the latter was
fully aware thereof. In fact, Ecole’s present directress, Ms. Lourdes L. Dayrit
(and even its foundress, Pat Limjuco Dayrit), had trained in Cointreau’s Le
Cordon Bleu culinary school in Paris, France. Cointreau was likewise the first
registrant of the said mark under various classes, both abroad and in the
Philippines, having secured Home Registration No. 1,390,912 dated November
25, 1986 from its country of origin, as well as several trademark registrations in
the Philippines.
On the other hand, Ecole has no certificate of registration over the
subject mark but only a pending application covering services limited to Class
41 of the Nice Classification, referring to the operation of a culinary school. Its
application was filed only on February 24, 1992, or after Cointreau filed its
trademark application for goods and services falling under different classes in
1990. Under the foregoing circumstances, even if Ecole was the first to use the
mark in the Philippines, it cannot be said to have validly appropriated the same.
It is thus clear that at the time Ecole started using the subject mark, the same
was already being used by Cointreau, albeit abroad, of which Ecole’s directress
was fully aware, being an alumna of the latter’s culinary school in Paris, France.
Hence, Ecole cannot claim any tinge of ownership whatsoever over the subject
mark as Cointreau is the true and lawful owner thereof. As such, the IPO
Director General and the CA were correct in declaring Cointreau as the true and
lawful owner of the subject mark and as such, is entitled to have the same
registered under its name.
In any case, the present law on trademarks, Republic Act No. 8293,
otherwise known as the Intellectual Property Code of the Philippines, as
amended, has already dispensed with the requirement of prior actual use at the
time of registration. Thus, there is more reason to allow the registration of the
subject mark under the name of Cointreau as its true and lawful owner. As a
final note, "the function of a trademark is to point out distinctly the origin or
ownership of the goods (or services) to which it is affixed; to secure to him, who
has been instrumental in bringing into the market a superior article of
merchandise, the fruit of his industry and skill; to assure the public that they are
procuring the genuine article; to prevent fraud and imposition; and to protect
the manufacturer against substitution and sale of an inferior and different
article as his product." As such, courts will protect trade names or marks,

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 although not registered or properly selected as trademarks, on the broad
ground of enforcing justice and protecting one in the fruits of his toil.

b. Case digest
Mighty Corporation v. E&J Gallo
G.R. No. 154342, July 14, 2004

FACTS:

E. & J. GALLO WINERY and THE ANDRESONS GROUP, INC, the respondents
herein sued MIGHTY CORPORATION and LA CAMPANA FABRICA DE TABACO,
INC., the petitioners in the RTC-Makati for trademark and trade name
infringement and unfair competition, with a prayer for damages and preliminary
injunction. They claimed that petitioners adopted the Gallo trademark to ride on
Gallo Winery’s and Gallo and Ernest & Julio Gallo trademark’s established
reputation and popularity, thus causing confusion, deception and mistake on
the part of the purchasing public who had always associated Gallo and Ernest
and Julio & Gallo trademarks with Gallo Winery’s wines.
In their answer, petitioners alleged, among other affirmative defenses
that: petitioners Gallo cigarettes and Gallo Winery’s wine were totally unrelated
products. To wit:
(1.) Gallo Winery’s GALLO trademark registration certificates covered
wines only, and not cigarettes;
(2.) GALLO cigarettes and GALLO wines were sold through different
channels of trade;
(3.) the target  market of Gallo Winery’s wines was the middle or high-
income bracket while Gallo cigarette buyers were farmers,
fishermen, laborers and other low-income workers;
(4.) that the dominant feature of the Gallo cigarette was the rooster
device with the manufacturer’s name clearly indicated as MIGHTY
CORPORATION, while in the case of Gallo Winery’s wines, it was
the full names of the founders-owners ERNEST & JULIO GALLO or
just their surname GALLO;

The Makati RTC denied, for lack of merit, respondent’s prayer for the
issuance of a writ of preliminary injunction. CA likewise dismissed respondent’s
petition for review on certiorari. After the trial on the merits, however, the
Makati RTC held petitioners liable for committing trademark infringement and
unfair competition with respect to the GALLO trademark. On appeal, the CA
affirmed the Makati RTC’s decision and subsequently denied petitioner’s motion
for reconsideration.

ISSUE/S:  Whether GALLO cigarettes and GALLO wines were identical, similar
or
related goods for the reason alone that they were purportedly
forms of
vice.

RULING:

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 NO. Wines and cigarettes are not identical, similar, competing or related
goods. The test of fraudulent simulation is to the likelihood of the deception of
some persons in some measure acquainted with an established design and
desirous of purchasing the commodity with which that design has been
associated. The simulation, in order to be objectionable, must be as appears
likely to mislead the ordinary intelligent buyer who has a need to supply and is
familiar with the article that he seeks to purchase.
Obviously, wines and cigarettes are not identical or competing products.
Neither do they belong to the same class of goods. Respondents’ GALLO wines
belong to Class 33 under Rule 84[a] Chapter III, Part II of the Rules of Practice in
Trademark Cases while petitioners’ GALLO cigarettes fall under Class 34. We
are mindful that product classification alone cannot serve as the decisive factor
in the resolution of whether or not wines and cigarettes are related goods.
Emphasis should be on the similarity of the products involved and not on the
arbitrary classification or general description of their properties or
characteristics. But the mere fact that one person has adopted and used a
particular trademark for his goods does not prevent the adoption and use of the
same trademark by others on articles of a different description. All told, after
applying all the tests provided by the governing laws as well as those
recognized by jurisprudence, we conclude that petitioners are not liable for
trademark infringement, unfair competition or damages.

8. Discuss the rights conferred by registration.

The owner of the registered mark shall have the exclusive right to
prevent all third parties not having the owner’s consent from using the course
of trade identical or similar signs or containers for goods and services which
hare identical or similar to those in respect of which the trademark is registered
where such use would result in a likelihood of confusion.
The owner has the right of protection against reproduction, or imitation or
unauthorized use of the mark and to stop entry of imported merchandise into
the country containing a mark identical or similar to the registered mark
together with the right to transfer or license out the mark.

9. What is the rule in the use by third parties of names, etc. similar to
registered mark?

Registration of the mark shall not confer on the registered owner the
right to preclude third parties from using bona fide their names, addresses,
pseudonyms, a geographical name, or exact indications concerning the kind,
quality, quantity, destination, value, place of origin, or time of production or of
supply, of their goods or services.

10. Discuss briefly what is trademark Infringement and the remedies

that could be availed of by the aggrieved party.

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 Trademark infringement is the use without consent of the trademark
owner of any a) reproduction, b) counterfeit, c) copy or d) colorable imitation of
any registered mark or tradename in connection with the sale, offering for sale,
or advertising of any goods, business or services on or in connection with which
such use is likely to cause confusion or mistake or to deceive purchasers or
others as to the source or origin of such goods or services, or identity of such
business; or reproduce, counterfeit, copy or colorably imitate any such mark or
tradename and apply such reproduction, counterfeit, copy or colorable
limitation to labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used upon or in connection with such goods,
business or services.

The remedies of the aggrieved party are the following:

(a.) Civil — both civil and criminal actions may be filed with the
Regional Trial Courts. The owner of the registered mark may ask
the court to issue a preliminary injunction to quickly prevent
infringer from causing damage to his business. Furthermore, the
court will require infringer to pay damages to the owner of the
mark provided defendant is shown to have had notice of the
registration of the mark (which is presumed if a letter R within a
circle is appended) and stop him permanently from using the mark.
(b.) Criminal — the owner of the trademark may ask the court to issue
a search warrant and in appropriate cases, remedies available
shall also include the seizure, forfeiture and destruction of the
infringing goods and of any materials and implements the
predominant use of which has been in the commission of the
offense.
(c.) Administrative — This remedy is the same as in patent
infringement cases. If the amount of damages claimed is not less
than P200,000.00, the registrant may choose to seek redress
against the infringer by filing an administrative action against the
infringer with the Bureau of Legal Affairs.

11. Explain unfair competition. Digest the case of

“Superior Commercial Enterprises, Inc. v. Kunnan Enterprises Ltd.,
G.R. No. 169974, April 20, 2010.”

Unfair Competition involves employing deception or any other means

contrary to good faith by which person passes off his goods or business or
services for those of one who has already established goodwill thereto. In unfair
competition, essential is the fraudulent intent to deceive the public and defraud
a competitor providing confusion as to similarity of the general appearance of
goods.

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FACTS:

Superior filed a complaint for trademark infringement and unfair

competition with preliminary injunction against Kunnan and Sports Concept. In
support of its complaint, Superior first claimed to be the owner of the
trademarks, trading styles, company names and business names "KENNEX",
"KENNEX & DEVICE", "PRO KENNEX" and "PRO-KENNEX" (disputed trademarks).
In its defense, Kunnan disputed Superior's claim of ownership and maintained
that Superior - as mere distributor from October 6, 1982 until December 31,
1991 - fraudulently registered the trademarks in its name. KUNNAN alleged that
it was incorporated in 1972, under the name KENNEX Sports Corporation for the
purpose of manufacturing and selling sportswear and sports equipment; it
commercially marketed its products in different countries, including the
Philippines since 1972. It created and first used "PRO KENNEX," derived from its
original corporate name, as a distinctive trademark for its products in 1976.
KUNNAN also alleged that it registered the "PRO KENNEX" trademark not only in
the Philippines but also in 31 other countries, and widely promoted the
"KENNEX" and "PRO KENNEX" trademarks through worldwide advertisements in
print media and sponsorships of known tennis players.

ISSUE:Whether or not KUNNAN can be held liable for trademark infringement

despite the cancellation of or SUPERIOR’s trademark?

HELD:

No. The CA decided that the registration of the "KENNEX" and "PRO
KENNEX" trademarks should be cancelled because SUPERIOR was not the owner
of, and could not in the first place have validly registered these trademarks.
Thus, as of the finality of the CA decision on December 3, 2007, these
trademark registrations were effectively cancelled and SUPERIOR was no longer
the registrant of the disputed trademarks. Section 22 of Republic Act No. 166,
as amended ("RA 166") is the law applicable to this case. Essentially, Section 22
of RA 166 states that only a registrant of a mark can file a case for
infringement. Corollary to this, Section 19 of RA 166 provides that any right
conferred upon the registrant under the provisions of RA 166 terminates when
the judgment or order of cancellation has become final. Thus, we have
previously held that the cancellation of registration of a trademark has the
effect of depriving the registrant of protection from infringement from the
moment judgment or order of cancellation has become final.
In the present case, by operation of law, specifically Section 19 of RA
166, the trademark infringement aspect of SUPERIOR's case has been rendered
moot and academic in view of the finality of the decision in the Registration
Cancellation Case. In short, SUPERIOR is left without any cause of action for
trademark infringement since the cancellation of registration of a trademark

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deprived it of protection from infringement from the moment judgment or order
of cancellation became final. To be sure, in a trademark infringement, title to
the trademark is indispensable to a valid cause of action and such title is shown
by its certificate of registration. With its certificates of registration over the
disputed trademarks effectively cancelled with finality, SUPERIOR's case for
trademark infringement lost its legal basis and no longer presented a valid
cause of action.
Even assuming that SUPERIOR's case for trademark infringement had not
been rendered moot and academic, there can be no infringement committed by
KUNNAN who was adjudged with finality to be the rightful owner of the disputed
trademarks in the Registration Cancellation Case. Even prior to the cancellation
of the registration of the disputed trademarks, SUPERIOR - as a mere distributor
and not the owner - cannot assert any protection from trademark infringement
as it had no right in the first place to the registration of the disputed
trademarks. In fact, jurisprudence holds that in the absence of any inequitable
conduct on the part of the manufacturer, an exclusive distributor who employs
the trademark of the manufacturer does not acquire proprietary rights of the
manufacturer, and a registration of the trademark by the distributor as such
belongs to the manufacturer, provided the fiduciary relationship does not
terminate before application for registration is filed.
In addition, we also note that the doctrine of res judicata bars SUPERIOR's
present case for trademark infringement. The doctrine of res judicata embraces
two (2) concepts: the first is "bar by prior judgment" under paragraph (b) of
Rule 39, Section 47, and the second is "conclusiveness of judgment" under
paragraph (c) thereof. In the present case, the second concept - conclusiveness
of judgment - applies. Under the concept of res judicata by conclusiveness of
judgment, a final judgment or decree on the merits by a court of competent
jurisdiction is conclusive of the rights of the parties or their privies in all later
suits on points and matters determined in the former suit. Stated differently,
facts and issues actually and directly resolved in a former suit cannot again be
raised in any future case between the same parties, even if the latter suit may
involve a different cause of action. This second branch of the principle of res
judicata bars the re-litigation of particular facts or issues in litigation between
the same parties on a different claim or cause of action. Because the
Registration Cancellation Case and the present case involve the same parties,
litigating with respect to and disputing the same trademarks, we are bound to
examine how one case would affect the other. In the present case, even if the
causes of action of the Registration Cancellation Case (the cancellation of
trademark registration) differs from that of the present case (the improper or
unauthorized use of trademarks), the final judgment in the Registration
Cancellation Case is nevertheless conclusive on the particular facts and issues
that are determinative of the present case.
To establish trademark infringement, the following elements must be
proven: (1) the validity of plaintiff's mark; (2) the plaintiff's ownership of the

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mark; and (3) the use of the mark or its colorable imitation by the alleged
infringer results in "likelihood of confusion." Based on these elements, we find it
immediately obvious that the second element - the plaintiff's ownership of the
mark - was what the Registration Cancellation Case decided with finality. On
this element depended the validity of the registrations that, on their own, only
gave rise to the presumption of, but was not conclusive on, the issue of
ownership. In no uncertain terms, the appellate court in the Registration
Cancellation Case ruled that SUPERIOR was a mere distributor and could not
have been the owner, and was thus an invalid registrant of the disputed
trademarks. Significantly, these are the exact terms of the ruling the CA arrived
at in the present petition now under our review. Thus, whether with one or the
other, the ruling on the issue of ownership of the trademarks is the same.
Given, however, the final and executory ruling in the Registration Cancellation
Case on the issue of ownership that binds us and the parties, any further
discussion and review of the issue of ownership - although the current CA ruling
is legally correct and can stand on its own merits - becomes a pointless
academic discussion.

12. Registration of marks under the Madrid Protocol

Madrid Protocol is the Protocol relating to the Madrid Agreement which

governs the system of international registration of marks. The system makes it
possible to protect a mark in a large number of countries by obtaining an
international registration which has effect in each of the Contracting Parties that
has been designated.

a. What is the coverage of the registration under Madrid Protocol?

The Madrid Protocol is a treaty that allows natural or juridical persons of

member countries to file international registrations through their respective
trademark offices (as office of origin designating other member countries to be
covered by the international registration. The Madrid Protocol’s basic effect is
being able to obtain individual national registrations in the designated countries
similar to securing trademark registrations directly and separately in the
designated countries, if the latter issues a grant of protection.
In the Philippines, the office of origin is the Philippine Intellectual Property
Office (IPOPHIL). You can file an international application with IPOPHL if (1) you
are a national of the Philippines; (2) you are domiciled in the Philippines; (3) you
have a real and effective industrial or commercial establishment in the
Philippines. You should have a duly maintained local trademark registration or
an active local trademark application with IPOPHL.

b. What are the rights conferred?

The applicant shall have access to a global infrastructure that would allow
them to secure protection for their marks through a simple, transparent, and

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cost-effective manner. The rights conferred on the registered proprietor include
the “exclusive right” to use it, to authorize other persons to use it and to obtain
relief of the infringement of the trademark.
In cases of infringement, the registered proprietor can seek the court’s
injunction, damages, an account of profits and, in certain cases, the award of
additional damages.

c. What are the requirements for registration?

To file an international registration under the Madrid Protocol through

IPOPHIL, the applicant must have a basic application/registration (I.e., a mark
filed/registered with the IPOPHIL under the applicable Philippine trademark law),
which basic application/registration will be the basis for international
registrations designating other member countries. The applicant must also be
eligible to apply for international registration through IPOPHIL.
Furthermore, an application for international registration (an
“international application”) may be filed only by a natural person or a legal
entity which has a real and effective industrial or commercial establishment in,
or is domiciled in, or is a national of, a country which is party to the Madrid
Agreement or the Madrid Protocol, or who has such an establishment in, or is
domiciled in, the territory of an intergovernmental organization which is a party
to the Protocol, or is a national of a member State of such an organization.

d. What is the term of protection?

The International Registration confers the same rights of protection to

foreign and native applicants, and that protection lasts for 10 years. Unlike the
CTM, which requires use in only one-member state, the Madrid Protocol requires
use in accordance with local law, which could mean use in every member
country. The use requirement is not much of a drawback if trademark
registration is sought with an eye toward immediate use, but this requirement
will forestall acquisition of a trademark in anticipation of future use.

C. Copyright

1. Discuss the basic principles of copyright.

As defined under Section 171 of Intellectual Property Code, Copyright is a

right over literary and artistic works which are original intellectual creations in
the literary and artistic domain protected from the moment of creation.
The elements of copyrightability are: (a) Originality wherein it must have
been created by the author’s own skill, labor, and judgment without directly
copying or evasively imitating the work of another; (b) Expression, it must be
embodied in a medium sufficiently permanent or stable to permit it to be
perceived, reproduced or communicated for a period more than a transitory
duration.

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 The elements of originality are: (a) it is independently created by the
author; and (b) It possesses some minimal degree of creativity.
Copyright vest when works are protected from the time of their creation,
irrespective of their mode or form of expression, as well as of their content,
quality and purpose.

a. Digest the case of “Kho v. CA,

G.R. No. 115758, March 11, 2002.”

Facts:

Petitioner, doing business under the name and style KEC Cosmetics
Laboratory, alleges that it is the registered owner of copyright and patent
registration of the Chin Chun Su container and medicated cream. Hence,
petitioner filed a complaint to enjoin respondent Summerville Company from
advertising and selling cream products under the same brand name Chin Chun
Su as it will mislead the public and damage petitioner’s business. The trial court
granted the injunction. On appeal, the writ was dissolved. The trial court ruled
to bar petitioner from using the mark Chin Chun Su.

Issue: Whether or not petitioner is entitled to the exclusive use of the

trademark Chin Chun Su based on her copyright and patent
registration over the product.

Ruling: 

No. Trademark, copyright and patents are different intellectual property

rights that cannot be interchanged with one another. A trademark is any visible
sign capable of distinguishing the goods (trademark) or services (service mark)
of an enterprise and shall include a stamped or marked container of goods. In
relation thereto, a trade name means the name or designation identifying or
distinguishing an enterprise. Meanwhile, the scope of a copyright is confined to
literary and artistic works which are original intellectual creations in the literary
and artistic domain protected from the moment of their creation. Patentable
inventions, on the other hand, refer to any technical solution of a problem in
any field of human activity which is new, involves an inventive step and is
industrially applicable. Petitioner has no right to support her claim for the
exclusive use of the subject trade name and its container. The name and
container of a beauty cream product are proper subjects of a trademark
inasmuch as the same falls squarely within its definition.
In order to be entitled to exclusively use the same in the sale of the
beauty cream product, the user must sufficiently prove that she registered or
used it before anybody else did. The petitioner’s copyright and patent
registration of the name and container would not guarantee her right to the
exclusive use of the same for the reason that they are not appropriate subjects
of the said intellectual rights. Consequently, a preliminary injunction order
cannot be issued for the reason that the petitioner has not proven that she has
a clear right over the said name and container to the exclusion of others, not

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having proven that she has registered a trademark thereto or used the same
before anyone did.

2. What are copyrightable works? Original works? Derivative works?

Under Section 172 of the Intellectual Property Code states that literary
and artistic works, hereinafter referred to as "works", are original intellectual
creations in the literary and artistic domain protected from the moment of their
creation and shall include in particular:

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

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

Under Section 173 of the Intellectual Property Code, the following

derivative works shall also be protected by copyright:

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 (a.) Dramatizations, translations, adaptations, abridgments,
arrangements,
and other alterations of literary or artistic works; and
(b) Collections of literary, scholarly or artistic works, and compilations
of
data and other materials which are original by reason of the
selection
or coordination or arrangement of their contents.

3. Which are non-copyrightable works?

Section 175 of the Intellectual Property Code states that notwithstanding

the provisions of Sections 172 and 173, no protection shall extend, under this
law, to any idea, procedure, system, method or operation, concept, principle,
discovery or mere data as such, even if they are expressed, explained,
illustrated or embodied in a work; news of the day and other miscellaneous
facts having the character of mere items of press information; or any official
text of a legislative, administrative or legal nature, as well as any official
translation thereof.
Generally, works of the Government is also non copyrightable under
Section 175 of the same code as provided that conditions imposed prior the
approval of the government agency or office wherein the work is created shall
be necessary for exploitation of such work for profit. Such agency or office, may,
among other things, impose as condition the payment of royalties except when
no prior approval or conditions shall be required for the use of any purpose of
statutes, rules and regulations, and speeches, lectures, sermons, addresses,
and dissertations, pronounced, read or rendered in courts of justice, before
administrative agencies, in deliberative assemblies and in meetings of public
character.
The author of speeches, lectures, sermons, addresses, and dissertations
mentioned in the preceding paragraphs shall have the exclusive right of making
a collection of his works.
Notwithstanding the foregoing provisions, the Government is not
precluded from receiving and holding copyrights transferred to it by
assignment, bequest or otherwise; nor shall publication or republication by the
Government in a public document of any work in which copyright is subsisting
be taken to cause any abridgment or annulment of the copyright or to authorize
any use or appropriation of such work without the consent of the copyright
owner.
TV programs, format of TV programs, Systems of bookkeeping; and
Statutes are also included as non-copyrightable works.

4. What are the rights of the copyright owner?

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 The natural person whose name is indicated on a work in the usual
manner as the author shall, in the absence of proof to the contrary, presumed
to be the author of the work. This is applicable even if the name is a
pseudonym, where the pseudonym leaves no doubt as to identity of the author.
Such name indicated has the presumption of authority as to the works or object
made.
Section 177 of the Intellectual Property Code provides that copyright or
economic rights shall consist of the exclusive right to carry out, authorize or
prevent the following acts:

(a.) Reproduction of the work or substantial portion of the work;

(b.) Dramatization, translation, adaptation, abridgment, arrangement
or
other transformation of the work;
(c.) The first public distribution of the original and each copy of the
work by sale or other forms of transfer of ownership;
(d.) Rental of the original or a copy of an audiovisual or
cinematographic work, a work embodied in a sound recording, a
computer program, a compilation of data and other materials or a
musical work in graphic form, irrespective of the ownership of the
original or the copy which is the subject of the rental; (n)
(e.) Public display of the original or a copy of the work;
(f.) Public performance of the work; and
(g.) Other communication to the public of the work.

a. Discuss the case of “Prosource International, Inc. v. Horphag

Research Management, G.R. No. 180073, November 25, 2009.”

Horphag Research Management SA is a corporation duly organized and

existing under the laws of Switzerland and the owner of trademark
PYCNOGENOL, a food supplement sold and distributed by Zuellig Pharma
Corporation. Respondent later discovered that petitioner Prosource
International, Inc. was also distributing a similar food supplement using the
mark PCO-GENOLS since 1996. This prompted respondent to demand that
petitioner cease and desist from using the aforesaid mark. Without notifying
respondent, petitioner discontinued the use of, and withdrew from the market,
the products under the name PCO-GENOLS. It, likewise, changed its mark from
PCOGENOLS to PCO-PLUS.
In determining similarity and likelihood of confusion, jurisprudence has
developed two tests: the Dominancy Test and the Holistic or Totality Test. The
Dominancy Test focuses on the similarity of the prevalent features of the
competing trademarks that might cause confusion and deception, thus
constituting infringement. In contrast, the Holistic Test entails a consideration of
the entirety of the marks as applied to the products, including the labels and
packaging, in determining confusing similarity. The discerning eye of the

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observer must focus not only on the predominant words but also on the other
features appearing on both labels in order that the observer may draw his
conclusion whether one is confusingly similar to the other.
The trial and appellate courts applied the Dominancy Test in determining
whether there was a confusing similarity between the marks PYCNOGENOL and
PCO-GENOL. Applying the test, the trial court found, and the CA affirmed, that:
Both the word[s] PYCNOGENOL and PCO-GENOLS have the same suffix "GENOL"
which on evidence, appears to be merely descriptive and furnish no indication
of the origin of the article and hence, open for trademark registration by the
plaintiff thru combination with another word or phrase such as PYCNOGENOL,
Exhibits "A" to "A-3." Furthermore, although the letters "Y" between P and C,
"N" between O and C and "S" after L are missing in the [petitioner’s] mark PCO-
GENOLS, nevertheless, when the two words are pronounced, the sound effects
are confusingly similar not to mention that they are both described by their
manufacturers as a food supplement and thus, identified as such by their public
consumers. And although there were dissimilarities in the trademark due to the
type of letters used as well as the size, color and design employed on their
individual packages/bottles, still the close relationship of the competing
products’ name in sounds as they were pronounced, clearly indicates that
purchasers could be misled into believing that they are the same and/or
originates from a common source and manufacturer.
Finally, the Court reiterate that the issue of trademark infringement is
factual, with both the trial and appellate courts finding the allegations of
infringement to be meritorious. As we have consistently held, factual
determinations of the trial court, concurred in by the CA, are final and binding
on this Court. Hence, petitioner is liable for trademark infringement.

5. Discuss the rules on ownership of copyright.

Section 178. of the Intellectual Property Code states that copyright

ownership shall be governed by the following rules:

(a.) Subject to the provisions of this section, in the case of original

literary
and artistic works, copyright shall belong to the author of the work;
(b.) In the case of works of joint authorship, the co-authors shall be the
original owners of the copyright and in the absence of agreement,
their rights shall be governed by the rules on co-ownership. If,
however, a work of joint authorship consists of parts that can be
used separately and the author of each part can be identified, the
author of each part shall be the original owner of the copyright in
the part that he has created;
(c.) In the case of work created by an author during and in the course
of
his employment, the copyright shall belong to:

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 (i.) The employee, if the creation of the object of
copyright
is not a part of his regular duties even if the employee
uses the time, facilities and materials of the
employer;
(ii.) The employer, if the work is the result of the
performance
of his regularly-assigned duties, unless there is an
agreement, express or implied, to the contrary.

(d.) In the case of a work commissioned by a person other than an

employer of the author and who pays for it and the work is made in
pursuance of the commission, the person who so commissioned
the work shall have ownership of the work, but the copyright
thereto shall remain with the creator, unless there is a written
stipulation to the contrary;
(e.) In the case of audiovisual work, the copyright shall belong to the
producer, the author of the scenario, the composer of the music,
the film director, and the author of the work so adapted. However,
subject to contrary or other stipulations among the creators, the
producer shall exercise the copyright to an extent required for the
exhibition of the work in any manner, except for the right to collect
performing license fees for the performance of musical
compositions, with or without words, which are incorporated into
the work; and
(f.) In respect of letters, the copyright shall belong to the writer subject
to
the provisions of Article 723 of the Civil Code.

6. Explain briefly the concept of “fair use” and rules involving the
same.

Fair use is a privilege to use the copyrighted material in a reasonable

manner without the consent of the copyright owner or as copying the theme or
ideas rather than their expression. Fair use permits a secondary use that serves
the copyright objective of stimulating productive thought and public instruction
without excessively diminishing the incentives for creativity.
“Fair use” permits a secondary use that “serves the copyright objective
of stimulating productive thought and public instruction without excessively
diminishing the incentives for creativity”. And the factors that should be
considered in order to determine “fair use” are:
(a.) The purpose and character of the use, including whether such use
is of a commercial nature or is for non‐profit educational purpose;

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 (b.) The nature of the copyrighted work;
(c.) The amount and substantiality of the portion used in relation to the
copyrighted work as a whole; and
(d.) The effect of the use upon the potential market for or value of the
copyrighted work.

a. Discuss the case of “ABS-CBN Corp. v. Gozon, et al.

G.R. No. 195956, March 11, 2015.”

The controversy arose from GMA-7’s news coverage on the homecoming

of Filipino overseas worker and hostage victim Angelo dela Cruz. Respondents
are officers and employees of GMA Network, Inc. (GMA-7). Overseas Filipino
worker Angelo dela Cruz was kidnapped by Iraqi militants and as a condition for
his release, a demand was made for the withdrawal of Filipino troops in Iraq.
After negotiations, he was released by his captors and was scheduled to return
to the country in the afternoon. Occasioned by said homecoming and the public
interest it generated, both GMA Network, Inc and Petitioner made their
respective broadcasts and coverage of the live event. ABS-CBN “conducted live
audio-video coverage of and broadcasted the arrival of Angelo dela Cruz at the
Ninoy Aquino International Airport (NAIA) and the subsequent press
conference.” ABS-CBN allowed Reuters Television Service (Reuters) to air the
footages it had taken earlier under a special embargo agreement. Under the
special embargo agreement, no other Philippine subscriber of Reuters would be
allowed to use ABS-CBN footage without the latter’s consent.
The Intellectual Property Code is clear about the rights afforded to
authors of various kinds of work. Under the Code, “works are protected by the
sole fact of their creation, irrespective of their mode or form of expression, as
well as of their content, quality and purpose.” These include “[audio-visual
works and cinematographic works and works produced by a process analogous
to cinematography or any process for making audiovisual recordings.” It is true
that under Section 175 of the Intellectual Property Code, “news of the day and
other miscellaneous facts having the character of mere items of press
information” are considered unprotected subject matter. However, the Code
does not state that expression of the news of the day, particularly when it
underwent a creative process, is not entitled to protection. News or the event
itself is not copyrightable. However, an event can be captured and presented in
a specific medium.
As recognized by the court in Joaquin, television “involves a whole
spectrum of visuals and effects, video and audio.” News coverage in television
involves framing shots, using images, graphics, and sound effects. It involves
creative process and originality. Television news footage is an expression of the
news. In this case, respondents admitted that the material under review which
is the subject of the controversy, is an exact copy of the original. Respondents
did not subject ABS-CBN’s footage to any editing of their own. The news footage

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did not undergo any transformation where there is a need to track elements of
the original.

7. What are the remedies of the aggrieved party in case of copyright

infringement? What are the penalties against the infringer?

The remedies of the aggrieved party in case of copyright infringement is

provided under Section 216 of the Intellectual Property Code which respectfully
states the following:

(a.) To an injunction restraining such infringement. The court may also

order the defendant to desist from an infringement, among others,
to prevent the entry into the channels of commerce of imported
goods that involve an infringement, immediately after customs
clearance of such goods;
(b.) Pay to the copyright proprietor or his assigns or heirs such actual
damages, including legal costs and other expenses, as he may
have incurred due to the infringement as well as the profits the
infringer may have made due to such infringement, and in proving
profits the plaintiff shall be required to prove sales only and the
defendant shall be required to prove every element of cost which
he claims, or, in lieu of actual damages and profits, such damages
which to the court shall appear to be just and shall not be regarded
as penalty;
(c.) Deliver under oath, for impounding during the pendency of the
action, upon such terms and conditions as the court may prescribe,
sales invoices and other documents evidencing sales, all articles
and their packaging alleged to infringe a copyright and implements
for making them;
(d.) Deliver under oath for destruction without any compensation all
infringing copies or devices, as well as all plates, molds, or other
means for making such infringing copies as the court may order;
(e.) Such other terms and conditions, including the payment of moral
and exemplary damages, which the court may deem proper, wise
and equitable and the destruction of infringing copies of the work
even in the event of acquittal in a criminal case.

While Section 217 of the same code provides that any person infringing
any right secured by provisions of Part IV of this Act or aiding or abetting such
infringement shall be guilty of a crime punishable by:

(a.) Imprisonment of one (1) year to three (3) years plus a fine ranging
from Fifty thousand pesos (P50,000) to One hundred fifty thousand
pesos (P150,000) for the first offense.

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 (b.) Imprisonment of three (3) years and one (1) day to six (6) years
plus a fine ranging from One hundred fifty thousand pesos
(P150,000) to Five hundred thousand pesos (P500,000) for the
second offense.
(c.) Imprisonment of six (6) years and one (1) day to nine (9) years
plus a fine ranging from five hundred thousand pesos (P500,000)
to One million five hundred thousand pesos (P1,500,000) for the
third and subsequent offenses.
(d.) In all cases, subsidiary imprisonment in cases of insolvency.

a. Digest the case of “ABS-CBN Corp. v. PMSI

G.R. No. 175769-70, January 19, 2009”.

FACTS:

Petitioner ABS-CBN, a broadcasting corporation, filed a complaint against

respondent PMSI alleging that the latter’s unauthorized rebroadcasting of
Channels 2 and 23 infringed on its broadcasting rights and copyright. PMSI
posits that it was granted a franchise to operate a digital direct-to-home
satellite service and that the rebroadcasting was in accordance with the NTC
memo to carry television signals of authorized television broadcast stations,
which includes petitioner’s programs. The IPO Bureau of Legal Affairs found
PMSI to have infringed petitioner’s broadcasting rights and ordered it to
permanently desist from rebroadcasting. On appeal, the IPO Director General
found for PMSI. CA affirmed.

ISSUE:Whether or not petitioner’s broadcasting rights and copyright are

infringed.

HELD:

NO. The Director-General of the IPO correctly found that PMSI is not
engaged in rebroadcasting and thus cannot be considered to have infringed
ABS-CBN’s broadcasting rights and copyright. Section 202.7 of the IP Code
defines broadcasting as “the transmission by wireless means for the public
reception of sounds or of images or of representations thereof; such
transmission by satellite is also ‘broadcasting’ where the means for decrypting
are provided to the public by the broadcasting organization or with its consent.”
On the other hand, rebroadcasting as defined in Article 3(g) of the International
Convention for the Protection of Performers, Producers of Phonograms and
Broadcasting Organizations, otherwise known as the 1961 Rome Convention, of
which the Republic of the Philippines is a signatory, is “the simultaneous
broadcasting by one broadcasting organization of the broadcast of another

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broadcasting organization.” The Working Paper prepared by the Secretariat of
the Standing Committee on Copyright and Related Rights defines broadcasting
organizations as “entities that take the financial and editorial responsibility for
the selection and arrangement of, and investment in, the transmitted content.”
Evidently, PMSI would not qualify as a broadcasting organization because it
does not have the aforementioned responsibilities imposed upon broadcasting
organizations, such as ABS-CBN. ABS-CBN creates and transmits its own signals;
PMSI merely carries such signals which the viewers receive in its unaltered
form. PMSI does not produce, select, or determine the programs to be shown in
Channels 2 and 23. Likewise, it does not pass itself off as the origin or author of
such programs. Insofar as Channels 2 and 23 are concerned, PMSI merely
retransmits the same in accordance with Memorandum Circular 04-08-88. With
regard to its premium channels, it buys the channels from content providers
and transmits on an as-is basis to its viewers. Clearly, PMSI does not perform
the functions of a broadcasting organization; thus, it cannot be said that it is
engaged in rebroadcasting Channels 2 and 23.

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