GR NO 154491
Coca-Cola Bottlers, Philippines, Inc. vs. Gomez
G.R. No. 154491
FACTS:
1. Initiation of the Case
– On July 2, 2001, Coca-Cola Bottlers, Phils., Inc. (CCBPI) applied for a search
warrant
against Pepsi Cola Products Phils., Inc. (Pepsi) for allegedly hoarding empty Coke
bottles at
Pepsi’s yard in Concepcion Grande, Naga City, purportedly violating Section
168.3(c) of the
Intellectual Property Code (IP Code).
2. Sworn Statements and Search Warrant Request
– Three witnesses, including Arnel John Ponce, Ylano A. Regaspi, and Edwin Lirio,
submitted
sworn statements alleging that Pepsi was hoarding Coke bottles. Ponce and Regaspi’s
statements were based on second-hand information, while Lirio claimed to have seen
the
bottles himself.
3. Issuance of Search Warrant:
– Executive Judge Julian C. Ocampo issued Search Warrant No. 2001-01. This led to
the
police seizing 2,464 Litro and 4,036 smaller empty Coke bottles, along with Pepsi
shells,
from Pepsi’s Naga yard.
4. Complaint and Respondents’ Affidavits:
– Following the seizure, a complaint was filed against two Pepsi officers, Galicia
and Gomez.
They countered, stating the empty Coke bottles were returned by retailers as
shortages for
Pepsi bottles and were unaware in advance. They denied their yard was intentionally
stockpiling Coke bottles.
5. Motions to Quash Search Warrant:
– Respondents moved to quash the search warrant and sought the return of the seized
items, arguing no probable cause existed, no crime was committed, and questioning
the
hearsay evidence.
6. MTC and RTC Rulings:
– MTC: Denied the motions but explained that trial is necessary to establish
whether
unfair competition was committed.
– RTC: Annulled the search warrant due to lack of probable cause for unfair
competition
under Section 168.3(c) but did not find grave abuse of discretion by the MTC judge.
7. Petition to the Supreme Court:
– Coca-Cola bypassed the Court of Appeals and petitioned the Supreme Court,
asserting that
the RTC contradicted itself by nullifying the warrant despite finding no grave
abuse of
discretion.
ISSUES:
1. Whether the application for a search warrant effectively charged an offense
under Section
168.3(c) of the IP Code – specifically, if the act of hoarding Coke bottles
constitutes unfair
competition.
2. Whether the MTC followed the procedures required by the Rules of Court in
issuing the
search warrant.
RULING
– The Supreme Court held that hoarding Coke bottles did not constitute an offense
under
Section 168.3(c) of the IP Code. The act of hoarding does not inherently involve
deception or
an attempt to pass off goods as those of another, nor is it calculated to discredit
the goods,
business, or services of another under the IP Code.
– Even if due process requirements were followed, the search warrant was invalid as
it was
issued for an act not constituting a crime under the provided provision. Thus,
without a
substantive offense, the procedural correctness of the search warrant becomes moot.
G.R. NO. 148222
Title: Pearl Dean (Phil.), Inc. v. Shoemart, Inc. and North Edsa Marketing, Inc.
FACTS:
1. Pearl Dean (Phil.) Inc. (P D) is a corporation engaged in the manufacture of
advertising
display units called light boxes, marketed as “Poster Ads.” P D held a Certificate
of
Copyright Registration and had applied for trademark registration for “Poster Ads.”
Around
1985, P D had negotiations with Shoemart, Inc. (SMI) to lease space for these light
boxes in
SMI’s malls.
2.Only the contract for SM Makati was signed, and later, SMI rescinded it, citing
non-performance. Subsequently, SMI and its sister company North Edsa Marketing Inc.
(NEMI) were found to have similar light boxes in their establishments, leading to P
D
alleging copyright infringement, trademark infringement, and unfair competition.
3. Sometime in 1985, Pearl and Dean negotiated with defendant-appellant Shoemart,
Inc. (SMI) for the lease and installation of the light boxes in SM City North Edsa.
Since SM City North Edsa was under construction at that time, SMI offered as an
alternative, SM Makati and SM Cubao, to which Pearl and Dean agreed. On September
11, 1985, Pearl and Dean’s General Manager, Rodolfo Vergara, submitted for
signature the contracts covering SM Cubao and SM Makati to SMI’s Advertising
Promotions and Publicity Division Manager, Ramonlito Abano. Only the contract for
SM Makati, however, was returned signed. On October 4, 1985, Vergara wrote Abano
inquiring about the other contract and reminding him that their agreement for
installation of light boxes was not only for its SM Makati branch, but also for SM
Cubao. SMI did not bother to reply.
4. Instead, in a letter dated January 14, 1986, SMI’s house counsel informed Pearl
and Dean that it was rescinding the contract for SM Makati due to non-performance
of the terms thereof. In his reply dated February 17, 1986, Vergara protested the
unilateral action of SMI, saying it was without basis. In the same letter, he
pushed for the signing of the contract for SM Cubao.
5. Two years later, Metro Industrial Services, the company formerly contracted by
Pearl and Dean to fabricate its display units, offered to construct light boxes for
Shoemart’s chain of stores. SMI approved the proposal and ten (10) light boxes were
subsequently fabricated by Metro Industrial for SMI. After its contract with Metro
Industrial was terminated, SMI engaged the services of EYD Rainbow Advertising
Corporation to make the light boxes. Some 300 units were fabricated in 1991. These
were delivered on a staggered basis and installed at SM Megamall and SM City.
6. Sometime in 1989, Pearl and Dean, received reports that exact copies of its
light boxes were installed at SM City and in the fastfood section of SM Cubao. Upon
investigation, Pearl and Dean found out that aside from the two (2) reported SM
branches, light boxes similar to those it manufactures were also installed in two
(2) other SM stores. It further discovered that defendant-appellant North Edsa
Marketing Inc. (NEMI), through its marketing arm, Prime Spots Marketing Services,
was set up primarily to sell advertising space in lighted display units located in
SMI’s different branches. Pearl and Dean noted that NEMI is a sister company of
SMI.
7. In the light of its discoveries, Pearl and Dean sent a letter dated December 11,
1991 to both SMI and NEMI enjoining them to cease using the subject light boxes and
to remove the same from SMI’s establishments. It also demanded the discontinued use
of the trademark "Poster Ads," and the payment to Pearl and Dean of compensatory
damages in the amount of Twenty Million Pesos (P20,000,000.00).
8. Upon receipt of the demand letter, SMI suspended the leasing of two hundred
twenty-four (224) light boxes and NEMI took down its advertisements for "Poster
Ads" from the lighted display units in SMI’s stores. Claiming that both SMI and
NEMI failed to meet all its demands, Pearl and Dean filed this instant case for
infringement of trademark and copyright, unfair competition and damages.
9. In denying the charges hurled against it, SMI maintained that it independently
developed its poster panels using commonly known techniques and available
technology, without notice of or reference to Pearl and Dean’s copyright. SMI noted
that the registration of the mark "Poster Ads" was only for stationeries such as
letterheads, envelopes, and the like. Besides, according to SMI, the word "Poster
Ads" is a generic term which cannot be appropriated as a trademark, and, as such,
registration of such mark is invalid. It also stressed that Pearl and Dean is not
entitled to the reliefs prayed for in its complaint since its advertising display
units contained no copyright notice, in violation of Section 27 of P.D. 49. SMI
alleged that Pearl and Dean had no cause of action against it and that the suit was
purely intended to malign SMI’s good name. On this basis, SMI, aside from praying
for the dismissal of the case, also counterclaimed for moral, actual and exemplary
damages and for the cancellation of Pearl and Dean’s Certification of Copyright
Registration No. PD-R-2558 dated January 20, 1981 and Certificate of Trademark
Registration No. 4165 dated September 12, 1988.
ISSUES:
1. Whether the copyright of the technical drawings for the light boxes extends to
the light
boxes themselves, thus constituting copyright infringement by SMI and NEMI.
2. Whether the light boxes themselves should have been separately registered and
protected
by a patent.
3. Whether P D can legally prevent others from using the “Poster Ads” trademark for
products not specified in its certificate of registration.
4. Whether the Court of Appeals erred in reversing the award of damages despite SMI
being
found guilty of bad faith.
5. Whether respondents SMI and NEMI are liable for trademark infringement based on
their
use of “Poster Ads” in their advertising display units.
6. Whether respondents SMI and NEMI are liable for actual, moral, and exemplary
damages, attorney’s fees, and costs of suit.
RULING:
1. The Court agreed with the Court of Appeals, holding that copyright protection
was limited
to the engineering drawings alone and not the light box itself.
2. Since P D did not secure a patent for the light boxes, they had no exclusive
rights that
could have been infringed upon by SMI or NEMI’s use of similar devices.
3. The Court found that P D’s trademark protection for “Poster Ads” was confined to
stationery and did not extend to the advertising display units used by SMI and
NEMI, thus
there was no trademark infringement.
4. The issue of damages was tied to the findings of copyright and trademark
infringement,
which were not upheld; thus, no damages were awarded.
5. As there was no trademark infringement established due to the non-registration
of
“Poster Ads” for light boxes, SMI and NEMI’s use of the mark did not constitute a
trademark violation.
6. Without a finding of copyright or trademark infringement, the Court of Appeals
rightly
dismissed the monetary awards granted by the lower court.
G.R. NO.174379
Title: E.I. Dupont De Nemours and Co. v. Director Emma C. Francisco, Director
Epifanio M.
Evaco, and Therapharma, Inc.
FACTS:
E.I. Dupont De Nemours (E.I. Dupont), an American corporation, is the assignee of
inventors
who filed a Philippine Patent Application No. 35526 for Angiotensin II Receptor
Blocking
Imidazole (losartan), a medication for hypertension and heart failure, marketed by
Merck
under Cozaar and Hyzaar.
The application was handled by local agent Atty. Mapili until his eath in 1996.
Unaware of the application’s abandonment in 1988 due to the agent’s failure
to respond, E.I. Dupont only discovered the abandonment in 2002 when it sought to
revive
the application, claiming they weren’t informed of Atty. Mapili’s demise.
The Intellectual roperty Office denied revival as it was filed out of time. E.I.
Dupont appealed to the Court
of Appeals (CA), which initially granted the revival but reversed itself on
reconsideration, partly due to Therapharma’s intervention citing vested rights in a
competing product. E.I. Dupont then appealed to the Supreme Court (SC).
E.I. Dupont Nemours and Company, an American corporation and assignee of U.S.
inventors Carini, Duncia, and Wong, filed Philippine Patent Application No. 35526
on July 10, 1987 for the invention related to Angiotensin II Receptor Blocking
Imidazole (losartan).
The invention, which pertains to treating hypertension and congestive heart
failure, was produced and marketed by Merck, Sharpe, and Dohme Corporation under
the trade names Cozaar and Hyzaar.
The patent application was initially handled by Atty. Nicanor D. Mapili, a long-
time local resident agent for Dupont Nemours between 1972 and 1996.
Following Mapili’s tenure—and later his death—new counsel (Ortega, Del Castillo,
Bacorro, Odulio, Calma, and Carbonell) took over, as evidenced by a Power of
Attorney submitted along with a letter on December 19, 2000, requesting an office
action from the Intellectual Property Office.
On January 30, 2002, an office action (Paper No. 2) was issued by Patent Examiner
Precila O. Bulihan; this action highlighted:
The absence of valid documents showing transfer of authority from the late Atty.
Mapili to the new counsel.
That the initial filing had received an office action as early as 1988 and was
declared abandoned due to a failure to respond within the prescribed period.
E.I. Dupont Nemours subsequently filed a Petition for Revival on May 29, 2002,
arguing that it had only discovered the abandonment and Mapili’s death at a later
stage, thereby claiming excusable negligence.
The Director of Patents denied the Petition for Revival on April 18, 2002,
reasoning that the revival was filed beyond the statutory period as mandated by the
rules (specifically Rule 115 and Section 113 of the 1962 Revised Rules of
Practice).
An appeal was made to Director-General Emma C. Francisco on August 26, 2002, which
was denied in a Decision dated October 22, 2003.
The petitioner then sought redress before the Court of Appeals by filing a Petition
for Review in November 2003.
The Court of Appeals initially granted the petition on August 31, 2004, providing
limited relief by relaxing the strict application of procedural rules in view of
the alleged gross negligence of the previous counsel.
Therapharma, Inc., a local competitor with its own application for a losartan
product and significant market investment, moved for intervention, raising concerns
that the revival of Dupont Nemours’ application might prejudice its “vested” rights
and disrupt market competition.
The Court of Appeals allowed intervention on January 31, 2006, noting that even if
the revival was a matter for appeal, Therapharma’s legal interest was significant.
On August 30, 2006, the Court of Appeals rendered an Amended Decision, reversing
its earlier ruling, and determined that revival of the patent application would
prejudice public interest as well as Therapharma’s investment, based on:
Delays amounting to inexcusable negligence by Dupont Nemours.
The established period for revival having been far exceeded (13 years instead of
the allowed 4 months).
The adverse impact on competition and public access to affordable losartan.
Petitioner argued that a Petition for Review under Rule 45 was proper and that the
failure in its counsel’s performance should not bind it entirely.
Respondents contended that the proper remedy should have been a petition under Rule
65 for review of an interlocutory order, and that the petition’s failure to attach
certain pertinent documents warranted dismissal.
Issues:
1. Did E.I. Dupont comply with Rule 45 by not attaching certain documents with the
petition?
2. Was a petition under Rule 65 more appropriate for raising issues of discretion?
3. Does the petition involve questions of law?
4. Did the CA err in allowing Therapharma’s intervention in the appeal?
5. Did the CA err in its grounds for denying E.I. Dupont’s appeal for the revival
of its patent
application?
6. Is Schuartz applicable, hence binding the client to the lawyer’s negligence?
7. Has the invention become part of the public domain?
Court’s Decision:
1. Although Rule 45 requires relevant documents to support the petition, E.I.
Dupont
provided sufficient evidence by including judgments and resolutions from the CA,
and later
complied by submitting additional pertinent documents, thus fulfilling procedural
requirements.
2. The petition under Rule 45 was the correct remedy as the CA had resolved both
the
intervention issue and the case’s merits.
3. The SC resolved that E.I. Dupont’s petition raised issues of law, not facts,
rendering Rule
45 appropriate.
4. The CA did not err by allowing Therapharma’s intervention because it had a
vested
interest due to its own competing product.
5. The CA correctly denied revival on the basis of inexcusable negligence by E.I.
Dupont and
third-party public interest being jeopardized due to the lack of competition.
6. The Schuartz ruling applies; the negligence by E.I. Dupont’s previous counsel is
binding,
leading to its patent application’s rightful abandonment.
7. E.I. Dupont’s argument of priority is irrelevant to the revival issue; the
application is
forfeited and considered part of the public domain
G.R. NO171053
Title:Sehwani, Inc. and Benita’s Frites, Inc. vs. In-N-Out Burger, Inc.
FACTS:
In-N-Out Burger, Inc., a California corporation, sought to protect its trademarks
“IN-NOUT,” “IN-N-OUT Burger & Arrow Design,” and “IN-N-OUT Burger Logo,” registered
in the
U.S. and elsewhere since 1948. In 1997, while applying for trademark registration
in the Philippines, In-N-Out discovered that Sehwani, Inc., without authorization,
had registered
the trademark “IN N OUT” (with the letter “O” styled as a star) in the Philippines
in 1993.
In-N-Out demanded that Sehwani cancel this registration, but the demand was refused
and Sehwani had licensed the trademark to Benita’s Frites, Inc. for its restaurant
operations.
Consequently, In-N-Out filed an administrative complaint for intellectual property
rights
violations with the Bureau of Legal Affairs (BLA) of the Intellectual Property
Office (IPO) of the Philippines.
Sehwani and Benita’s Frites counterargued that In-N-Out lacked legal capacity to
sue as it was not doing business in the Philippines and had no registered trademark
there. Sehwani,
as the registered owner of the mark in the Philippines, claimed the presumption of
validity.
In 2003, the BLA’s Director Beltran-Abelardo ruled in favor of In-N-Out, cancelling
Sehwani’s trademark registration and ordering a permanent cease and desist from
using the
marks. Both parties sought reconsideration, which was denied. Sehwani’s subsequent
appeal to the IPO Director General was dismissed as untimely. Sehwani escalated the
case
to the Court of Appeals, which affirmed the dismissal. Sehwani then filed an appeal
to the Supreme Court.
On June 2, 1997, while applying for registration of its trademark “IN-N-OUT Burger
& Arrow Design” and servicemark “IN-N-OUT,” the respondent discovered that
petitioners had registered a confusingly similar mark on December 17, 1993.
The respondent demanded that Sehwani, Inc. desist from using the disputed mark and
cancel its registration.
Despite the demand, petitioners not only refused to cancel the registration, but
they also entered into a Licensing Agreement with Benitaas Frites, Inc. for the use
of the mark “IN-N-OUT BURGER” in their restaurant in Pasig City.
Their counterclaim further argued that the respondent lacked legal capacity to sue
because it was not doing business in the Philippines and that there was no valid
cause of action as the mark was neither registered nor used locally.
Administrative and Appellate Proceedings
Respondent initiated an administrative complaint before the Bureau of Legal Affairs
of the IPO and the Intellectual Property Office.
Bureau Director Estrellita Beltran-Abelardo rendered Decision No. 2003-02 on
December 22, 2003, finding that:
The respondent possessed the legal capacity to sue and owned internationally
recognized trademarks.
Petitioners were not guilty of unfair competition; however, Sehwani, Inc.’s
Certificate of Registration No. 56666 was cancelled, and petitioners were ordered
to cease using the disputed marks.
Petitioners filed a motion for reconsideration and later appealed, contending that:
They believed the notice of the Resolution was received on a later date, thereby
affording them time to file an appeal.
The respondent lacked legal capacity to sue and that no grounds for cancellation
had been established under Section 151 of RA 8293.
Their appeal should be entertained despite a procedural lapse.
The Director General, in Appeal No. 14-2004-0004, dismissed the appeal as being
filed out of time based on the strict computation of statutory periods.
The Court of Appeals affirmed the Director General’s order, rendering the
administrative decisions final and executory.
Contentions and Counterarguments
They alleged a mere technicality – their appeal filing date was miscomputed due to
their counsel’s oversight, given his limited resources as a solo practitioner.
They maintained that the respondent did not have the legal capacity to sue and that
the cancellation of their trademark registration was not supported by sufficient
evidence, further arguing that laches or prescription should bar the respondent’s
claim.
Counterarguments by the Administration and the Courts:
The administrative and judicial bodies underscored that the strict compliance of
filing deadlines is mandatory and jurisdictional.
The evidence presented, including international registrations and extensive
advertising supporting the respondent’s claim of a well-known mark, was deemed
sufficient to uphold the cancellation of petitioners’ registration.
ISSUE:
1. Did the Court of Appeals err by dismissing the appeal on a technicality without
addressing the merits?
2. Does In-N-Out have legal capacity to sue despite not doing business in the
Philippines?
3. Is there merit to Sehwani’s claims of laches, the absence of ground for
cancellation, and
lack of capacity of In-N-Out to sue?
RULING:
1.The Court upheld the dismissal due to late filing.
The period for perfecting an appeal is mandatory and jurisdictional. Sehwani’s
appeal was
filed out of time, rendering the previous decision final and executory.
2.The Supreme Court recognized the right of foreign
corporations to sue in the Philippines for intellectual property enforcement under
Section
160 in relation to Section 3 of Republic Act No. 8293 (Intellectual Property Code),
given
international treaties like the Paris Convention. Additionally, In-N-Out’s
trademarks were
deemed internationally well-known.
3. The defense of laches does not apply
against specific statutory provisions. Section 151(b) of the Intellectual Property
Code allows
cancellation of registration if obtained by fraud or misrepresentation. Based on
evidence,
the Court found that Sehwani misrepresented the source of goods, justifying
cancellation of
their registration.
G.R. NO.167715
TITLE:Phil Pharmawealth, Inc. vs. Pfizer, Inc. and Pfizer (Phil.), Inc.: A Case on
Patent
Infringement and Forum Shopping
FACTS:
This case revolves around a complaint for patent infringement filed by Pfizer,
Inc., and
Pfizer (Phil.), Inc. (respondents) against Phil Pharmawealth, Inc. (petitioner)
with the
Bureau of Legal Affairs of the Intellectual Property Office (BLA-IPO).
Pfizer claims to hold
the Philippine Letters Patent No. 21116, covering a method related to Sulbactam
Ampicillin,
a combination of antibiotics. Pfizer, marketing Sulbactam Ampicillin under the
brand
“Unasyn,” learned that Phil Pharmawealth was submitting bids to supply Sulbactam
Ampicillin to various hospitals without their consent, infringing their patent
rights.
Pfizer secured a preliminary injunction from BLA-IPO against Phil Pharmawealth,
which was
effective for 90 days. Upon its expiration, a motion for extension was denied by
BLA-IPO.
Pfizer’s motion for reconsideration was also denied, prompting them to file a
special civil
action for certiorari with the CA, seeking an injunction’s reinstatement and
extension.
Concurrently, Pfizer filed a complaint for infringement and unfair competition with
damages
against Phil Pharmawealth in the RTC of Makati City, seeking similar injunctions.
Phil Pharmawealth contended that Pfizer’s patent had lapsed and alleged Pfizer of
forum
shopping for filing similar actions in different forums. The CA denied Phil
Pharmawealth’s
motions to dismiss, maintaining the temporary restraining order and injunction
against
them.
Parties and Background
Phil Pharmawealth, Inc. (petitioner) is engaged in the importation, distribution,
and sale of pharmaceutical products.
Pfizer, Inc. and Pfizer (Phil.) Inc. (respondents) are the registered owners of
Philippine Letters Patent No. 21116.
The case originated from a complaint filed with the Bureau of Legal Affairs of the
Intellectual Property Office (BLA-IPO) alleging patent infringement.
Pfizer’s Patent No. 21116, issued on July 16, 1987, covers a method for increasing
the effectiveness of a beta-lactam antibiotic by co-administering it with a
compound (sulbactam sodium) disclosed by the formula IA.
The patent’s claims extend to a combination of penicillin (such as ampicillin
sodium) and beta-lactam antibiotics (such as sulbactam sodium); this combination is
marketed by Pfizer under the brand name “Unasyn.”
The patent was valid until its expiration on July 16, 2004, as provided by the
governing laws at the time (Section 21 of RA 165).
In January–February 2003, Pfizer became aware that petitioner submitted bids to
supply “Unasyn” to various hospitals without Pfizer’s consent.
Pfizer sent letters to the hospitals demanding that they cease accepting bids from
petitioner and insisting petitioner withdraw its bids.
Despite these demands, petitioner continued its activities, which Pfizer contended
infringed upon its exclusive patent rights.
The BLA-IPO, in an order dated July 15, 2003, granted a temporary restraining order
against petitioner, later denying the motion for extension filed by respondents.
Respondents subsequently filed a special civil action for certiorari with the Court
of Appeals (CA) challenging the BLA-IPO’s decisions, as well as a separate
complaint with the Regional Trial Court (RTC) of Makati City for infringement and
unfair competition.
On January 18, 2005, the CA approved the bond posted by respondents and maintained
the temporary restraining order despite the petitioner's motion to dismiss based on
the lapse of the patent.
On April 11, 2005, the CA rendered a resolution denying the petitioner’s motions to
dismiss and for reconsideration.
Issues Leading to Litigation
Petitioner contended that any injunctive relief is inapplicable since Pfizer’s
patent had already expired on July 16, 2004, thereby eliminating Pfizer’s exclusive
rights.
The propriety of the CA’s review over the BLA-IPO’s interlocutory orders and the
appropriate tribunal to resolve issues under the doctrine of primary jurisdiction
was challenged.
The petition also raised the issue of forum shopping, as respondents had
simultaneously instituted actions with the BLA-IPO and the RTC for essentially the
same relief.
ISSUE:
1. Can an injunction be issued based on a patent infringement action when the
patent has
already expired?
2. Which tribunal has jurisdiction to review decisions of the BLA-IPO’s Director of
Legal
Affairs?
3. Is there forum shopping when a party files two actions with different causes of
action yet
seeks the same relief?
RULING:
1. The Court agreed with Phil Pharmawealth that the exclusive right to a
patent lasts only during the patent term. Since Pfizer’s patent expired on July 16,
2004,
Pfizer no longer had exclusive rights that needed protection by injunction.
2. The Court clarified that the CA, not the IPO
Director General, has jurisdiction to review interlocutory orders of the BLA-IPO.
The CA is
authorized to resolve if there’s been grave abuse of discretion in BLA-IPO’s
decisions.
3. The Court found Pfizer guilty of forum shopping by filing two
different complaints (in the IPO and the RTC) based on similar facts and seeking
similar
relief, potentially causing vexation to the court system and raising the risk of
conflicting
decisions
