PUP BAR REVIEW CENTER

December 11, 2020

Prof. Ernesto C. Salao

Intellectual Property Rights

- Copyright and Related Rights;

- Trademarks and Service Marks;
- Geographic indications;
- Industrial designs;
- Patents;
- Layout designs (Topographies) of Integrated Circuits;
- Protection of Undisclosed Information.

Differences between Copyrights, Trademarks and Patent

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. Elidad Kho v. Court of Appeals, G.R. No. 115758, March
19, 2002

Sample Question:

A invented a machine. Assume its patentable.

A owns trademark and copyright registration on the machine.
B is selling same machine.
Is B liable for patent infringement?

Answer:

No. Trademark, copyright and patents are different intellectual property rights that cannot
be interchanged with one another.

Fernando U. Juan, Petitioner, V. Roberto U. Juan (Substituted By His Son Jeffrey

C. Juan) And Laundromatic Corporation, Respondents, G.R. No. 221732, August
23, 2017

“Copyright and trade or service name are different.”

Facts:

There was a dispute between siblings as to who between them is the lawful owner of the
name and mark "Lavandera Ko" for their laundry business. The judge ruled no one since
the same was the original mark and work of a certain Santiago S. Suarez (Santiago) who
composed the song
“Lavandera Ko” in 1942. The ruling was based on internet resource.

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Key Answers:

The above ruling is erroneous as it confused trade or business name with copyright.
“Lavandera Ko," the mark in question in this case is being used as a trade name or
specifically, a service name since the business in which it pertains involves the rendering
of laundry services.

Kensonic, Inc. v. Uni-Line Multi-Resources, Inc. G.R. No. 211820-21, June 6, 2018

“To be noted is that the controversy revolves around the SAKURA mark which is not a
copyright. The distinction is significant. Xxx Obviously, the SAKURA mark is not an
artistic or literary work but is a sign used to distinguished the goods or services of one
enterprise from those of another.”

Patents

A set of exclusive rights granted by a State to an inventor or assignee for a fixed period of
time in exchange for a disclosure of an invention.

The law attempts to strike an ideal balance between the two interests. On one side of the
coin is the public which will benefit from new ideas; on the other are the inventors who
must be protected.

DISCLOSURE

The law attempts to strike an ideal balance between the two interests. On one side of the
coin
is the public which will benefit from new ideas; on the other are the inventors who must
be protected.

E.I. Dupont De Nemours And Co. v. Director Emma C. Francisco And

Therapharma, Inc., G.R. No. 174379, August 31, 2016

“A patent is a monopoly granted only for specific purposes and objectives. Thus, its
procedures must be complied with to attain its social objective.”

Facts:

The application for patent was filed by a local lawyer on behalf of an American
Corporation. The lawyer was said to be negligent. The corporation asks for leniency since
the fault is attributable to the lawyer and not to the company applicant. Can the
corporation revive application on
ground of lawyer’s negligence?

Suggested answer:

No the corporation should not be allowed to revive the application.

A patent is a monopoly granted only for specific purposes and objectives. Thus, its
procedures must be complied with to attain its social objective. Any request for leniency
in its procedures should be taken in this context.

Petitioner, however, has failed to convince the court that the revival of its patent
application would have a significant impact on the pharmaceutical industry.

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 If the product (losartan) was mentioned -

Key Answer:

Hypertension, or high blood pressure, is considered a "major risk factor for

cardiovascular disease" such as "heart disease, stroke, kidney failure and blindness.”
Public interest will be prejudiced if, despite petitioner's inexcusable negligence, its
petition for revival is granted.

“The patent application is only confidential before its publication. It was inaccurate,
therefore, for petitioner to argue that secrecy in patent applications prevents any
intervention from
interested parties. The confidentiality in patent applications under the Intellectual
Property Code is not absolute since a party may already intervene after the publication of
the application.”

Patentable Inventions

Sec. 21. Patentable Inventions. — Any technical solution of a problem in

any field of human activity which is new, involves an inventive step and is
industrially applicable shall be patentable. It may be, or may relate to, a
product, or process, or an improvement of any of the foregoing.

Elements of Patentability

(1) Novelty

Not part of a prior art. (1. Everything that is already available to the public
anywhere in the world. 2. Those that are actually subject of application for patent
registration.)

(2) Inventive Step

Not obvious to a person skilled in the art. (Sec. 26 )

In the case of drugs and medicines, there is no inventive step if:

o the invention results from the mere discovery of a new form or new
property of a known substance which does not result in the enhancement
of the known efficacy of that substance; or
o the mere discovery of any new property or new use for a known
substance; or
o the mere use of a known process unless such known process results in a
new product that employs at least one new reactant. (Sec. 26.2)

(3) Industrial Applicability

Can be produced and used in any industry shall be industrially applicable.

(Sec. 27)

2019 BAR

X Pharmaceuticals, Inc. has been manufacturing the antibiotic ointment Marvelopis, which is
covered by a patent expiring in the year 2020. In January 2019, the company filed an application

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for a new patent for Disilopis, which, although constituting the same substance as Marvelopis, is
no longer treated as an antibiotic but is targeted and marketed for a new use, i.e., skin whitening.

(a) What are the three (3) requisites of patentability under the Intellectual Property Code? (3%)
(b) Should X Pharmaceuticals, Inc.'s patent application for Disilopis be granted? Explain. (2%)

Non-Patentable Inventions

1. Discoveries, scientific theories and mathematical methods (Sec. 22, par.1)

Question:

A discovered new mineral that will be included in the periodic table of

elements. – Not patentable
BAR 2006 - Supposing Albert Einstein were alive today and he filed with the
Intellectual Property Office (IPO) an application for patent for his theory of relativity
expressed in the formula E=mc2. The IPO disapproved Einstein’s application on the
ground that his theory of relativity is not patentable. Is the IPO’s action correct?
Answer:
Yes, the IPO’s action is correct. Scientific theories and mathematical
methods are not patentable.

2. In case of drugs - mere discovery of a new form or new property of a known

substance which does not result in the enhancement of the known efficacy of
that substance. (Sec. 22, par.1)

A has a patent on a drug. A discovered that the said drug may be in liquid
form. – Not patentable unless it results in the enhancement of its efficacy.

3. Or the mere discovery of any new property or new use for a knownsubstance,
or the mere use of a known process unless such known process results in a
new product that employs at least one new reactant. (Sec. 22, par.1)

A has a patent on a drug for liver disease. Later, it was discovered that the
same drug also cures another disease. – Not patentable.

4. Schemes, rules and methods of performing mental acts, playing games or

doing business, and programs for computers. (Sec. 22, par.2)

BAR 1989 - X invented a method of improving the tenderness of meat by

injecting an enzyme solution into the live animal shortly before a slaughter.
Is the invention patentable?

Suggested answer:

Method per se is not patentable.

Enzyme solution may be patentable if it meets all the elements of
patentability.

5. Methods for treatment of the human or animal body by surgery or therapy

and diagnostic methods practiced on the human or animal body. This
provision shall not apply to products and composition for use in any of these
methods. (Sec. 22, par.1)

2010 Bar.

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 Dr. Nobel discovered a new method of treating Alzheimer’s involving a special
method of diagnosing the disease, treating it with a new medicine that has been
discovered after long experimentation and field testing, and novel mental isometric
exercises. He comes to you for advice on how he can have his discoveries protected.
Can he legally protect his new method of diagnosis, the new medicine, and the new
method of treatment? If no, why? If yes, how? (4%)

Answer:

New medicine - yes. (Sec. 21)

Method of diagnosis – no. (Sec. 22)

6. 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 (HENCE,
MICRO-ORGANISMS, NON-BIOLOGICAL AND MICROBIOLOGIAL
PROCESSES ARE PATENTABLE).

EXCEPTION TO PLANT VARIETIES AND ANIMAL BREEDS -

Provisions under this subsection shall not preclude Congress to consider the
enactment of a law providing sui generis of plant varieties and animal breeds
and a system of community intellectual rights protection. (Sec. 21, par.4)

7. Aesthetic creations (Sec. 21, par. 5)

8. Anything which is contrary to public order or morality. (Sec. 21, par.6)

Ownership of a Patent

a. Right to a Patent

Basic rule - The inventor has the right to a patent. Patent may be assigned mortis causa or
inter vivos. The right to a patent may also be subject of joint-ownership as when two or
more persons have jointly made an invention. (Sec. 27)

b. First-to-File Rule (Sec. 29)

If two (2) or more persons have made the invention separately and independently of each
other, the right to the patent shall belong to the person who filed an application for such
invention, or where two or more applications are filed for the same invention, to the
applicant who has the earliest filing date or, the earliest priority date.

c. Inventions Created Pursuant to a Commission

Pursuant to a commission - the person who commissions the work shall be the owner of the
patent unless otherwise there was an agreement to the contrary.

Pursuant to employment - the patent shall belong to:

(a) The employee, if the inventive activity is not a part of his regular duties even if the
employee uses the time, facilities and materials of the employer.
(b) The employer, if the invention is the result of the performance of his regularly-assigned
duties, unless there is an agreement, express or implied, to the contrary.

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 d. Right of Priority

An application for patent filed by any person who has previously applied for the same
invention in another country which by treaty, convention, or law affords similar privileges to
Filipino citizens, shall be considered as filed as of the date of filing the foreign application
(Sec. 31, IPC).

Conditions in availing of priority date:

(1) The local application expressly claims priority;

(2) It is filed within 12 months from the date the earliest foreign application was filed; and

(3) A certified copy of the foreign application together with an English translation is filed
within 6 months from the date of filing in the Philippines (Sec. 31, IPC).

Not Automatic Grant

Relevant only when there are two or more conflicting patent applications. Because a right of
priority does not automatically grant letters patent to an applicant, possession of a right of
priority does not confer any property rights on the applicant in the absence of an actual patent.
E.I. Dupont De Nemours And Co. v. Director Emma C. Francisco And Therapharma, Inc., G.R.
No. 174379, August 31, 2016

Grounds for Cancellation of a Patent

Who may file - Any interested person

Grounds for cancellation are the following:

(a) The invention is not new or patentable;

(b) 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) The patent is contrary to public order or morality.

Partial cancellation- Where the grounds for cancellation relate to some of the claims or
parts of the claim, cancellation may be effected to such extent only.

Remedy of the True and Actual Inventor

Requisite - declared by final court order or decision to be the true and actual inventor

Remedies - court shall order for his

(1) substitution as patentee, or

(2) at the option of the true inventor, cancel the patent, and
(3) award actual damages in his favor if warranted by the circumstances (Sec. 68, IPC).

If patent is awarded NOT TO THE FIRST FILER

If a person referred to in Section 29 other than the applicant, is declared by final court order
or decision as having the right to the patent, such person may, within three (3) months after
the decision has become final:
(1) Prosecute the application as his own 

(2) File a new patent application 

(3) Request the application to be refused; or
(4) Seek cancellation of the patent (Sec. 67, IPC). 


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 2005 BAR. Cezar works in a car manufacturing company owned by Joab. Cezar is quite
innovative and loves to tinker with things. With the materials and parts of the car, he was
able to invent a gas-saving device that will enable cars to consume less gas. Francis, a co-
worker, saw how Cezar created the device and likewise, came up with a similar gadget,
also using scrap materials and spare parts of the company. Thereafter, Francis filed an
application for registration of his device with the Bureau of Patents. Eighteen months
later, Cezar filed his application for the registration of his device with the Bureau of
Patents.

b. Assuming that it is patentable, who is entitled to the patent? What, if any, is the
remedy of the losing party?

Suggested answer:

Francis is entitled to the patent, because he had the earlier filing date.

The remedy of Cezar, as the losing party, is to file a case in court that he be declared as
the true and actual inventor. Thereafter, he may ask for substitution as patentee, or cancel
the patent if one has been awarded already, and ask for award of actual damages.

WHAT IF:

SAME FACTS.

Francis has earlier filing date but the patent was awarded to Cezar. What is the remedy of
Francis.

Suggested answer:

The remedy of Francis is to file a case in court that he be declared as the rightful owner
of the patent on account of his ealier filing date.

Thereafter, he may prosecute the application as his own, or file a new patent application,
or request that the application be refused or seek the cancellation of the patent if one has
been awarded already. 


Rights Conferred by a Patent

1. On a PRODUCT– Right to RESTRAIN any unauthorized person or entity from

making, using, offering for sale, selling or importing the product.

2. On a PROCESS – Right to RESTRAIN any unauthorized person or entity from using

the process and from manufacturing, dealing in, using, offering for sale, selling or
importing any product obtained directly or indirectly from such process (Sec. 71, IPC).

3. Right to assign the patent, to transfer by succession, and to conclude licensing

contracts (Sec. 71.2, IPC).

Limitations of Patent Rights

1. Using a patented product which has been PUT ON THE MARKET in the Philippines

WITH RESPECT TO DRUGS (RA 9502 AMENDING IPC)

“72.1. the limitation on patent rights shall apply after a drug or medicine has
been introduced in the Philippines or ANYWHERE ELSE IN THE WORLD

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 by the patent owner, or by any party authorized to use the invention: Provided,
further, That the right to IMPORT the drugs and medicines contemplated in this
section shall be available to any government agency or any private third party;

2. Where the act is done PRIVATELY and on a NON-COMMERCIAL SCALE or

purpose PROVIDED that it does not significantly prejudice the economic interests of
the owner of the patent;
3. Where the act consists of making or using EXCLUSIVELY FOR THE PURPOSE OF
EXPERIMENTS that relate to the subject matter of the patented invention;

4. Where the act consists of the PREPARATION FOR INDIVIDUAL CASES, in a

pharmacy or by a medical professional, of a medicine in accordance with a medical
prescription or acts concerning the medicine so prepared;

WITH RESPECT TO DRUGS:

“72.4. Where the act includes testing, etc. solely for purposes reasonably related
to the development and submission of information and issuance of
APPROVALS by government regulatory agencies required under any law of
the Philippines or of another country that regulates the manufacture,
construction, use or sale of any product. (BOLAR PROVISION)
“72.5. Where the act consists of the preparation for individual cases, in a
pharmacy or by a medical professional, of a medicine in accordance with a
medical prescription or acts concerning the medicine so prepared; and

5. Where the invention is used in any SHIP, VESSEL, AIRCRAFT, OR LAND

VEHICLES of any other country entering the territory of the Philippines temporarily or
accidentally, provided that such invention is used EXCLUSIVELY FOR THE NEEDS of
the ship, vessel, aircraft, or land vehicle and not used for the manufacturing of anything to
be sold within the Philippines.

a. Prior User

REQUIREMENT – must be in good faith

INCLUDES – one who has undertaken serious preparations to use the invention in his
enterprise or business

a. Use by the Government

Government agency or third person authorized by the Government may exploit the
invention even without agreement of the patent owner.

Grounds:
1. The public interest, in particular, national security, nutrition, health or the development
of other sectors, as determined by the appropriate agency of the government, so requires;
or
2. A judicial or administrative body has determined that the manner of exploitation, by the
owner of the patent or his license, is ANTI-COMPETITIVE.

Patent Infringement

The making, using, offering for sale, selling, or importing a patented product or a product
obtained directly or indirectly from a patented process, or the use of a patented process
without the authorization of the patentee constitutes patent infringement.

a. Tests in Patent Infringement

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i. Literal Infringement

Literal infringement Test – consist of copying the words of the claim.

ii. Doctrine of Equivalents (“FUNCTION-MEANS-AND-RESULT TEST”)

where there is no literal infringement (because of modification) but performs
substantially the same FUNCTION in substantially the same METHODOLOGY to
achieve substantially the same RESULT. Sameness in the result alone will not result to
infringement.

TRIPLE REMEDY -

1. Civil action for infringement – 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. (Sec 76.2, IPC)

If the damages are inadequate or cannot be reasonably ascertained with reasonable

certainty, the court may award by way of damages a sum equivalent to reasonable
royalty (Sec 76.3, IPC).

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

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).

Foreign National’s right to sue -

Any foreign national or juridical entity who meets the requirements of Sec. 3 and not
engaged in business in the Philippines, to which a patent has been granted or assigned,
whether or not it is licensed to do business in the Philippines (Sec. 77, IPC). 


b. Defenses in Action for Infringement

BAR 1991 - Ferdie is a patent owner of a certain invention. He discovered that his invention
is being infringed by Johann. (1) what are the remedies available to Ferdie against Johann.
(2) If you were the lawyer of Johann in the infringement suit, what are the defenses that
your client can assert?

1. Invalidity of the patent (Sec. 81, IPC);


2. Any of the Grounds for cancellation of patents:

a. Not new or patentable (remember elements of patentability)

b. Insufficient disclosure (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. Contrary to public order or morality (Sec. 61, IPC).

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 3. Other defenses –

Prescription

Sec. 79 - No damages can be recovered for acts of infringement committed more

than four (4) years before the institution of the action for infringement.
BUT
Sec. 70 - The actions indicated in Sections 67 (First filer) and 68 (true and actual
inventor) shall be filed within one (1) year from the date of publication made in
accordance with Sections 44 and 51, respectively.
Sec. 84 - The criminal action herein provided shall prescribe in three (3) years from
date of the commission of the crime. (Sec. 84)
CRIMINAL ACTION – REPETITION IS NECESSARY
SEC. 84 - If infringement is repeated by the infringer or by anyone in connivance
with him after finality of the judgment of the court against the infringer, the
offenders shall, without prejudice to the institution of a civil action for damages, be
criminally liable xxx.

Licensing

Voluntary Licensing

Highly-regulated contract –

All technology transfer arrangements shall comply with the provisions of this Chapter.
(Sec. 85)

Reason why regulated –

1. To encourage the transfer and dissemination of technology

2. Prevent or control practices that may have an adverse effect on competition and trade

How is it regulated –

1. Law prescribes Prohibited Clauses (Sec. 87) and Mandatory Clauses (Sec. 88)

Prohibited:
1. Imposing upon the licensee the obligation to acquire from a SPECIFIC SOURCE
capital goods, intermediate products, raw materials, and other technologies, or of
permanently employing personnel indicated by the licensor;
2. Licensor reserves the right to fix the sale or resale prices of the products
manufactured on the basis of the license;
3. Contain restrictions regarding the volume and structure of production;
4. Prohibit use of competitive technologies in a non-exclusive technology transfer
agreement;
5. Establish a full or partial PURCHASE OPTION IN FAVOR OF THE LICENSOR;
6. Obligate the licensee to transfer for FREE to the licensor the inventions or
improvements that may be obtained through the use of the licensed technology;
7. Require payment of royalties to the owners of patents for patents which are NOT
USED;
8. Prohibit the licensee to export the licensed product unless justified for the protection
of the legitimate interest of licensor such as exports to countries where exclusive licenses
to manufacture and/or distribute the licensed product(s) have already been granted;
9. Restrict the use of the technology supplied after the expiration of the technology
transfer arrangement, except in cases of early termination of the technology transfer
arrangement due to reason(s) attributable to the licensee;
10. Require payments for patents and other industrial property rights after their

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 expiration, termination arrangement;
11. Require that the technology recipient shall not contest the validity of any of the
patents of the technology supplier;
12. Restrict the research and development activities of the licensee designed to absorb
and adapt the transferred technology to local conditions or to initiate research and
development programs in connection with new products, processes or equipment;
13. Prevent the licensee from adapting the imported technology to local conditions, or
introducing innovation to it, as long as it does not impair the quality standards prescribed
by the licensor;
14. Exempt the licensor for liability for non-fulfillment of his responsibilities under the
technology transfer arrangement and/or liability arising from third party suits brought
about by the use of the licensed product or the licensed technology; and
15. Other clauses with equivalent effects.

2010 BAR : What contractual stipulations are required in all technology transfer
agreements? Enumerate three (3) stipulations that are prohibited in technology transfer
agreements.

Mandatory Clauses

1. Philippine laws govern the interpretation of the same and in the event of
litigation, the venue shall be the proper court in the place where the LICENSEE
has its principal office;
2. Continued access to improvements in techniques and processes related to the
technology shall be made available during the period of the technology transfer
arrangement;
3. ARBITRATION - the Procedure of Arbitration of the Arbitration Law of the
Philippines or the Arbitration Rules of the United Nations Commission on International
Trade Law (UNCITRAL) or the Rules of Conciliation and Arbitration of the
International Chamber of Commerce (ICC) shall apply and the venue of arbitration shall
be the Philippines OR ANY NEUTRAL COUNTRY; and
4. The Philippine taxes on all payments relating to the technology transfer arrangement
shall be borne by the LICENSOR.

WHAT IF LICENSE CONTRACT DOES NOT CONFORM TO SEC. 87 AND 88 –

Result – UNENFORCEABLE (Sec. 92)

Exception – Approved and registered with the Bureau of Information and Technology
Transfer Bureau if falling under exceptional cases under Sec. 91.

Sec. 91. Exceptional Cases.

(1) High technology content
(2) Increase in foreign exchange earnings
(3) Employment generation
(4) Regional dispersal of industries and/or substitution with or use of local raw
materials,
(5) Board of Investments, registered companies with pioneer status.

Compulsory Licensing

IPO thru the Director General grants a 3rd Party a license to exploit the invention even
against will of patent owner.

HOW – File petition. Director of Legal Affairs has jurisdiction.

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GROUNDS AND PERIOD TO APPLY (SEC. 93 in relation to Sec. 94) –

1. National emergency or other circumstances of extreme urgency – anytime after the

grant of patent
QUESTION – “A” owns a patent over a lighting device powered by salt water. A
calamity resulted to massive power outages in almost half of the country. “A” increased
the price of his product. What can be done about it.
ANSWER - The government may use the patent or may grant a petition filed by a third
person to manufacture the device on account of national emergency.
2. Public interest - (national security, nutrition, health or the development of other vital
sectors of the national economy as determined by the appropriate agency of the
Government, so requires) – anytime after the grant of patent

BAR 2017

Super Biology Corporation (Super Biology) invented and patented a miracle medicine for
the cure of AIDS. Being the sole manufacturer, Super Biology sold the medicine at an
exorbitant price. Because of the sudden prevalence of AIDS cases in Metro Manila and
other urban areas, the Department of Health (DOH) asked Super Biology for a license to
produce and sell the AIDS medicine to the public at a substantially lower price. Super
Biology, citing the huge costs and expenses incurred for research and development,
refused.

Assuming you are asked your opinion as the legal consultant of the DOH, discuss how
you will resolve the matter.

Suggested Answer:

I will advise that the DOH explore the option of compulsory licensing.

There is a clear showing that the agency has determined the existence of a sufficient
ground for
the grant to such kind of license.

Thus, the option of compulsory licensing is appropriate in this case.

3. Judicial or administrative body has determined that the manner of exploitation by the
owner of the patent or his licensee is ANTI-COMPETITIVE – anytime after the grant of
patent
QUESTION – “A” owns a patent over a mobile phone charging device powered by salt
water only. “A” entered into an exclusive distribution agreement with Sunsung
Electronics for its mobile device. Sunsung’s market share increased from 10% to 80%
because of its charging device feature. Chico Electronics, the erstwhile leading mobile
phone seller filed a petition for the grant of compulsory license because it claims that
the patent is ANTI-COMPETITIVE. Rule on the petition.
ANSWER - The petition is pre-mature since there is no finding yet from judicial or
administrative body that the manner of exploitation of the patent is anti-competitive.
4. In case of PUBLIC NON-COMMERCIAL USE of the patent by the patentee, without
satisfactory reason – anytime after the grant of patent
5. If the patented invention is NOT BEING WORKED IN THE PHILIPPINES on a
commercial scale, although capable of being worked, without satisfactory reason:
Provided, That the IMPORTATION OF THE PATENTED ARTICLE SHALL
CONSTITUTE WORKING or using the patent - before the expiration of a period of four
(4) years from the date of filing of the application or three (3) years from the date of the
patent whichever period expires last.

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 QUESTION – “A” owns a patent over a mobile phone charging device powered by salt
water only. “A” set up its factory in China because of lower production cost. “A”
imports the product to the Philippine market. “B” petitioned for Compulsory Licensing
on the ground that the invention is not being worked in the Philippines. Rule on the
petition.
ANSWER - The petition should be denied. The law provides that the importation of
the patented article shall constitute working in the Philippines.
6. Where the DEMAND FOR PATENTED DRUGS and medicines is not being met to
an adequate extent and on reasonable terms, as determined by the Secretary of the
Department of Health – anytime after the grant of patent

Requirement to Obtain a License on Reasonable Commercial Terms

The license will only be granted after the petitioner has made efforts to obtain authorization
from the patent owner on reasonable commercial terms and conditions but such efforts
have not been successful within a reasonable period of time.
This requirement shall NOT apply in the following cases:
1. Where the petition for compulsory license seeks to remedy a practice determined after
judicial or administrative process to be anti-competitive;
2. In situations of national emergency or other circumstances of extreme urgency;
3. In cases of public non-commercial use; and
4. In cases where the demand for the patented drugs and medicines in the Philippines is not
being met to an adequate extent and on reasonable terms, as determined by the Secretary
of the Department of Health.
HENCE: ONLY WHEN THE GROUND IS PATENT NOT BEING WORKED IN THE
PHILIPPINES ON A COMMERCIAL SCALE THE REQUIREMENT IS
APPLICABLE.

Terms and Conditions of Compulsory License

1. The scope and duration of such license shall be limited to the purpose for which it was
authorized;
2. The license shall be non-exclusive;
3. The license shall be non-assignable, except with that part of the enterprise or business
with which the invention is being exploited;
4. Use of the subject matter of the license shall be devoted predominantly for the supply of
the Philippine market provided that this limitation shall not apply where the grant of the
license is based on the ground that the patentee’s manner of exploiting the patent is
determined by judicial or administrative process, to be anti-competitive;
5. The license may be terminated upon proper showing that circumstances which led to its
grant have ceased to exist and are unlikely to recur provided that adequate protection shall
be afforded to the legitimate interest of the licensee; and
6. The patentee shall be PAID ADEQUATE REMUNERATION taking into account the
economic value of the grant or authorization, EXCEPT THAT IN CASES WHERE THE
LICENSE WAS GRANTED TO REMEDY A PRACTICE WHICH WASDETERMINED
AFTER JUDICIAL OR ADMINISTRATIVE PROCESS, TO BE ANTI-COMPETITIVE
THE NEED TO CORRECT THE ANTI-COMPETITIVE PRACTICE MAY BE TAKEN
INTO ACCOUNT IN FIXING THE AMOUNT OF REMUNERATION. (Sec. 100)

Assignment and Transmission of Rights

Form of Assignment

Page 13 of 43
 The assignment must be in writing, acknowledged before a notary public or other officer
authorized to administer oath or perform notarial acts, and certified under the hand and
official seal of the notary or such other officer. (Sec. 105)

Recording

Such instruments shall be VOID as against any subsequent purchaser or mortgagee for
valuable consideration and without notice, unless, it is so recorded in the IPO, within three
(3) months from the date of said instrument, or prior to the subsequent purchase or
mortgage. (Sec. 106)

Trademarks

Definition of Marks, Collective Marks, Trade Names

MARK 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.
(Sec. 121.1)

Collective mark - any visible sign designated as such in the application for registration
and capable of distinguishing the origin or any other common characteristic, including
the quality of goods or services of different enterprises which use the sign under the
control of the registered owner of the collective mark. (Sec. 121.2)

Trade name - name or designation identifying or distinguishing an enterprise. (Sec.

121.3) Also known as “BUSINESS IDENTIFIER”

Acquisition of trade names

Trade names or business names are acquired through adoption and use. Registration is
not required (Sec. 165).

QUESTION:

Coffee Partners Inc. plan to open a coffee shop named “SAN FRANCISCO COFFEE”.
San Francisco Coffee & Roastery, Inc. , is a domestic corporation engaged in the
wholesale and retail of coffee. It was alleged by Coffee Partners that San Francisco is not
a registered trade name. Can San Francisco Coffee & Roastery, Inc. prevent Coffee
Partners Inc from opening their “SAN FRANCISCO COFFEE” coffeeshop? Reason.

ANSWER:

Yes. The Intellectual Property Codehas dispensed with the registration requirement for
tradename. The law categorically states that trade names shall be protected, even prior to
or without registration with the IPO, against any unlawful act including any subsequent
use of the trade name by a third party, whether as a trade name or a trademark likely to
mislead the public.

Acquisition of Ownership of Mark

The rights in a mark shall be acquired through registration made validly in accordance with
the provisions of the law. (Sec. 122)

Page 14 of 43
ZUNECA PHARMACEUTICAL v. NATRAPHARM, INC., G.R. NO. 211850, Sept.
8, 2020, En Banc

Petitioner sells drug under brand name “ZYNAPS” used to control all types of seizure
disorders like epilepsy. It has been using the mark since 2004. Respondent is selling
“ZYNAPSE” which is treatment for cerebrovascular disease or stroke.

The mark was registered with the IPO on September 24, 2007. Both parties admitted that
the marks are confusingly similar.

Issue: Do the rights of the first-to-file registrant defeat the rights of the prior user?

Answer:

No. At present, as expressed in the language of the provisions of the IP Code, prior use
no longer determines the acquisition of ownership of a mark in light of the adoption of
the rule that ownership of a mark is acquired through registration validly in accordance
with the provisions of the IP Code.

With an omission in the IP Code provision of the phrase “previously used in the
Philippines by another and not abandoned,” said right of the first user is no longer
available. In effect, based on the language of the IP Code, even if the mark was
previously used and not abandoned by another, a good faith applicant may still register
the same and thus become the owner thereof, and the prior user cannot ask for the
cancellation of the latter’s registration.

Note:

“A trademark is a creation of use and belongs to one who first used it in the trade or
commerce. Thus, the prima facie presumption brought about by the registration of a mark
may be challenged and overcome, in an appropriate action, by proof of the nullity of the
registration or of non-use of the mark, except when excused.”

ZUNECA PHARMACEUTICAL v. NATRAPHARM, INC. G.R. NO. 211850, Sept. 8,

2020 En Banc

“The Court now rectifies the inaccurate statement in Berris that “[t]he ownership of a
trademark is acquired by its registration and its actual use.” The rectified statement
should thus read” “Under the IP Code, the ownership of a trademark is acquired by its
registration.”

What is not the use of “USE” in Trademark Law?

“Certainly, while the IP Code and the Rules of the IP mandate that the
applicant/registrant must prove continued actual use of the mark, it is the considered view
of the Court that this does not imply that actual use is still a recognized mode of
acquisition of ownership under the IP Code. Rather, these must be understood as
provisions that require actual use of the mark in order for the registrant owner of a mark
to MAINTAIN his ownership.” (Zuneca Pharaceutical v. Natrapharm)

Requirement of Good Faith

“The existence of bad faith in trademark registrations may be ground for its cancellation
at any time by filing a petition for cancellation under Section 151(b) of the IP Code.”
Bad faith means that the applicant or registrant has knowledge of prior creation, use
and/or registration by another of an identical or similar trademark. In
other words, it is copying and using somebody else’s trademark.

Page 15 of 43
 WHAT IF THE ARGUMENT OF THE DOMESTIC CORP IS THAT IT IS THE
FOREIGN MARK IS NOT REGISTED IN THE PHILS. AND THEREFOR NOT
ACCORDED PROTECTION –

SUGGESTED ANSWER:

The argument is untenable because unregistered foreign marks are still accorded
protection against infringement and unfair competition under the Paris Convention
assuming that the country of origin is a signatory to the same. (Ecole De Cuisine Manille
(Cordon Bleu of the Philippines), Inc. v. Renaud Cointreau, June 5, 2013)

BAR 2014 - Jinggy went to Kluwer University (KU) in Germany for his doctorate degree
(Ph.D.). He completed his degree with the highest honors in the shortest time. When he
came back, he decided to set-up his own graduate school in his hometown in Zamboanga.
After seeking free legal advice from his high-flying lawyer-friends, he learned that the
Philippines follows the territoriality principle in trademark law, i.e., trademark rights are
acquired through valid registration in accordance with the law. Forthwith, Jinggy named
his school the Kluwer Graduate School of Business of Mindanao and immediately
secured registration with the Bureau of Trademarks. KU did not like the unauthorized use
of its name by its top alumnus no less. KU sought your help. What advice can you give
KU?

SUGGESTED ANSWER –

I will advice KU to seek the cancellation of the registration of Kluwer Graduate School
of Business.

In a recent case decided by the Supreme Court, it was held that foreign marks that are
not registered are still accorded protection against infringement and unfair competition
under the Paris Convention. It is to be noted that the country of origin is Germany, a
signatory to the Paris Convention.

Another reason is that the use of “Kluwer” by Jinggy should not be allowed since it
falsely suggest connection to Kluwer University (KU) of Germany. (Fredco v. Harvard)

Proof of Actual Use

(1) labels of the mark as these are used;

(2) downloaded pages from the website of the applicant or registrant clearly showing that
the goods are being sold or the services are being rendered in the Philippines;
(3) photographs (including digital photographs printed on ordinary paper) of goods
bearing the marks as these are actually used or of the stamped or marked container of
goods and of the establishment/s where the services are being rendered;
(4) brochures or advertising materials showing the actual use of the mark on the goods
being sold or services being rendered in the Philippines;
(5) for online sale, receipts of sale of the goods or services rendered or other similar
evidence of use, showing that the goods are placed on the market or the services are
available in the Philippines or that the transaction took place in the Philippines;
(6) copies of contracts for services showing the use of the mark.

W Land Holdings, Inc., V. Starwood Hotels And Resorts Worldwide, Inc., G.R. No. 222366,
December 4, 2017

Based on the amended Trademark Regulations, it is apparent that the IPO has now given due
regard to the advent of commerce on the internet. Specifically, it now recognizes, among others,
"downloaded pages from the website of the applicant or registrant clearly showing that the

Page 16 of 43
goods are being sold or the services are being rendered in the Philippines," as well as "for online
sale, receipts of sale of the goods or services rendered or other similar evidence of use, showing
that the goods are placed on the market or the services are available in the Philippines or that the
transaction took place in the Philippines," as acceptable proof of actual use.
HOWEVER –

It must be emphasized, however, that the mere exhibition of goods or services over the internet,
without more, is not enough to constitute actual use.

To reiterate, the "use" contemplated by law is genuine use - that is, a bona fide kind of use
tending towards a commercial transaction in the ordinary course of trade.

2019 BAR

In 2005, W Hotels, Inc., a multinational corporation engaged in the hospitality business, applied
for and was able to register its trademark "W" with the Intellectual Property Office of the
Philippines (IPO) in connection with its hotels found in different parts of the world.

In 2009, a Filipino corporation, RST Corp., filed before the IPO a petition for cancellation of W
Hotels, Inc.'s "W" trademark on the ground of non-use, claiming that W Hotels, Inc. failed to use
its mark in the Philippines because it is not operating any hotel in the country which bears the
"W" trademark.

In its defense, W Hotels, Inc. maintained that it has used its "W" trademark in Philippine
commerce, pointing out that while it did not have any hotel establishment in the Philippines, it
should still be considered as conducting its business herein because its hotel reservation services,
albeit for its hotels abroad, are made accessible to Philippine residents through its interactive
websites prominently displaying the "W" trademark. W Hotels, Inc. also presented proof of
actual booking transactions made by Philippine residents through such websites. Is W Hotels,
Inc.'s defense against the petition for cancellation of trademark tenable? Explain. (5%)

Non-Registrable Marks (Sec. 123)

1. Consists of:
(1) immoral, deceptive or scandalous matter
(2) matter which may disparage or
(3) falsely suggest a connection with persons, living or dead, institutions, beliefs, or national
symbols, or bring them into contempt or disrepute. (Sec. 123.1[a])

Illustration:
Fredco’s registration of the mark “Harvard” should not have been allowed since it
falsely suggests a connection with an Harvard University. Fredco’s registration of the
mark “Harvard” and its identification of origin as “Cambridge, Massachusetts” falsely
suggest that Fredco or its goods are connected with Harvard University, which uses
the same mark “Harvard” and is also located in Cambridge, Massachusetts. (Fredco
Manufacturing Corp. v. President and Fellows of Harvard College, 2011)

2. 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. (Sec. 123.1[b])

WHAT IF APPLICANT USES ISIS INSIGNIA?

ANSWER – USE GROUND CONTRARY TO PUBLIC ORDER.

Consists of:

Page 17 of 43
 (1) name, portrait or signature identifying a particular living individual except by his written
consent, or
(2) 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. (Sec. 123.1[c])

WHAT IF NAME OF DECEASED PRESIDENT OF ANOTHER COUNTRY

- FALSELY SUGGEST CONNECTION
WHAT IF NAME OF DECEASED PH. PRESIDENT AND WIDOW IS ALREADY
DEAD
- FALSELY SUGGEST CONNECTION WITH PERSON LIVING OR DEAD

4. Is identical with a registered mark belonging to a different proprietor or a mark with an

earlier filing or priority date, in respect of: (a) the same goods or services; (b) or closely related
goods or services; (c) or if it nearly resembles such a mark as to be likely to deceive or cause
confusion. (Sec. 123.1[d])

1. IDENTICAL MARKS but only with respect to (a) same goods or services

Nike (assume that it is registered) for shoes

2. IDENTICAL MARKS but only with respect to (b) closely related goods or services

Nike for shirts and pants (Ang Tibay case)

But Emperador can be registered for cigarette. Mighty Corp. v. E&J Gallo Winery
(2004) “Use of identical mark, if taken alone, does not automatically guarantee a
finding of trademark infringement xxx”

REASON: Wines and Cigarettes not closely related goods (Mighty corp.)

Question:

Taiwan Kolin applied for trademark registration of “Kolin” on combination of goods,

including colored television, refrigerators, window-type and slpit-type
airconditioners, electric fans and water dispensers. These goods fall under Class 9 of
the Nice Classification.

Kolin Electronics opposed the application claiming that the mark Taiwan Kolin seeks to
register is identical, if not confusingly similar with its “Kolin” Mark registered on
November 23, 2003, covering automatic voltage regulator, converter, recharger,
stereo booster, transformer. These goods also fall under Class 9 of the Nice
Classification.

Resolve the case.

Suggested answer:

The case must be resolved in favor of registrability of the mark of Taiwan Kolin.
The mere uniformity in categorization (Class 9), by itself, does not automatically
preclude the registration of what appears to be an identical mark. The Supreme Court has
held several times that such circumstance does not necessarily result in any trademark
infringement. Taiwan Kolin Corp. v. Kolin Electronics, Co. (2015)

3. Nearly resembles such a mark (registered mark) as to be likely to deceive or cause

confusion.

Page 18 of 43
 COLORABLE IMITATION OF A REGISTERED MARK

When is there colorable imitation?

Close or ingenious imitation as to be calculated to deceive ordinary persons, or such a
resemblance to the original as to deceive an ordinary purchaser giving such attention
as a purchaser usually gives, as to cause him to purchase the one supposing it to be
the other. (CONFUSION) Etepha v. Director of Patents (1966)
Mcdonald’s Corporation v. L.C. Big Mak Burger, Inc. G.R. No. 143993, August 18,
2004 –

Big Mac v. Big Mak

Responent’s use of “Big Mak” causes confusion. Petitioners claim that respondents’
use of the “Big Mak” mark on respondents’ hamburgers results in confusion of
goods, particularly with respect to petitioners’ hamburgers labeled “Big Mac.”
WHAT IF THE ARGUMENT IS THAT “BIG MAK” CATERS TO LOW-
INCOME GROUP?
“The likelihood of confusion of business remains, since the low-income group might
be led to believe that the “Big Mak” hamburgers are the low-end hamburgers
marketed by petitioners. After all, petitioners have the exclusive right to use the “Big
Mac” mark. On the other hand, respondents would benefit by associating their low-
end hamburgers, through the use of the “Big Mak” mark, with petitioners’ high-end
“Big Mac” hamburgers, leading to likelihood of confusion in the identity of
business.”
WHAT IF THE ARGUMENT IS THAT “BIG MAK” IS USED FOR NON-
HAMBURGER PRODUCTS?
“The Court has recognized that the registered trademark owner enjoys protection in
product and market areas that are the normal potential expansion of his business.”

IS THERE A NEED TO PROVE ACTUAL CONFUSION?

NO.

“Petitioners’ failure to present proof of actual confusion does not negate their claim
of trademark infringement. As noted in American Wire & Cable Co. v. Director of
Patents, Section 22 requires the less stringent standard of “likelihood of confusion”
only. While proof of actual confusion is the best evidence of infringement, its absence
is inconsequential.” Mcdonald’s Corporation v. L.C. Big Mak Burger, Inc.

When are Goods or Services Related?

Related goods and services are those that, though non-identical or non-similar, are so
logically
connected to each other that they may reasonably be assumed to originate from one
manufacturer or from economically-linked manufacturers.

Mang Inasal Philippines, Inc. v. IFP Manufacturing Corporation, G.R. No. 221717,
June 19, 2017

Petitioner is the owner of the mark "Mang Inasal, Home of Real Pinoy Style Barbeque and
Device." Respondent is applying for registration for “OK Hotdog Inasal” for product curl
snack
products. Both marks cover inasal or inasal flavored food products.

Ruling: “OK Hotdog Inasal” not registrable.

Page 19 of 43
Key Answer: There is ample reason to conclude that the said product and services may
nonetheless be regarded as related to each other. Accordingly, it is the fact that the
underlying goods and services of both marks deal with inasal and inasal-flavored products
which ultimately fixes the relations between such goods and services.

Factors to consider in determining whether goods or services are related:

1. the business (and its location) to which the goods belong;

2. the class of product to which the goods belong;
3. the product's quality, quantity, or size, including the nature of the package, wrapper or
container;
4. the nature and cost of the articles;
5. the descriptive properties, physical attributes or essential characteristics with reference to
their
form, composition, texture or quality;
6. the purpose of the goods;
7. whether the article is bought for immediate consumption, that is, day-to-day household
items;
8. the fields of manufacture;
9. the conditions under which the article is usually purchased, and
10. the channels of trade through which the goods flow, how they are distributed, marketed,
displayed and sold.

BUT:

The mere uniformity in categorization (Class 9), by itself, DOES NOT

AUTOMATICALLY PRECLUDE the registration of what appears to be an identical mark.
The Supreme Court has held several times that such circumstance does not necessarily
result in any trademark infringement. Taiwan Kolin Corp. v. Kolin Electronics, Co. (2015)

Sample Question:

Kolin Electronics opposed the application claiming that the mark Taiwan Kolin seeks to
register is identical, if not confusingly similar with its “Kolin” Mark registered on
November 23, 2003, covering automatic voltage regulator, converter, recharger, stereo
booster, transformer. These goods also fall under Class 9 of the Nice Classification. Resolve
the case.

Suggested Answer

The case must be resolved in favor of registrability of the mark of Taiwan Kolin.

The mere uniformity in categorization (Class 9), by itself, does not automatically preclude
the
registration of what appears to be an identical mark. The Supreme Court has held several
times
that such circumstance does not necessarily result in any trademark infringement. (Taiwan
Kolin Corp. v. Kolin Electronics, Co. (2015))

When is there colorable imitation?

Close or ingenious imitation as to be calculated to deceive ordinary persons, or such a

resemblance to the original as to deceive an ordinary purchaser giving such attention as a
purchaser usually gives, as to cause him to purchase the one supposing it to
be the other.

Page 20 of 43
CONFUSION

Case was filed against Vic Diaz for violation of Section 155, in relation to Section 170, of
IPC. The prosecution established that Levi Strauss and Company (Levi’s), is a foreign
corporation based in USA. It is the owner of trademarks and designs of Levi’s jeans like
LEVI’S 501. After receiving information that Diaz was selling counterfeit LEVI’S 501
jeans in his tailoring shops in Almanza and Talon, Las Piñas City, Levi’s Philippines
hired a private investigation group to verify the information. Surveillance and the
purchase of jeans from the tailoring shops of Diaz established that the jeans bought from
the tailoring shops of Diaz were counterfeit or imitations of LEVI’S 501.

On his part, Diaz admitted being the owner of the shops searched, but he denied any
criminal liability. Diaz stated that he did not manufacture Levi’s jeans, and that he used the
label "LS Jeans Tailoring" in the jeans that he made and sold; that the label "LS Jeans
Tailoring" was registered with the Intellectual Property Office; that his shops received
clothes for sewing or repair; that his shops offered made-to-order jeans, whose styles or
designs were done in accordance with instructions of the customers; that since the time his
shops began operating in 1992, he had received no notice or warning regarding his
operations; that the jeans he produced were easily recognizable because the label "LS Jeans
Tailoring," and the names of the customers were placed inside the pockets, and each of the
jeans had an "LSJT" red tab; that "LS" stood for "Latest Style;" and that the leather patch
on his jeans had two buffaloes, not two horses.

Should the court convict Vic Diaz for trademark infringement in this case?

Suggested Answer:

No, the court should find Vic Diaz innocent in this case.
It is the likelihood of confusion is the gravamen of the offense of trademark infringement.
Accordingly, the jeans trademarks of Levi’s Philippines and Diaz must be considered as a
whole in determining the likelihood of confusion between them. The maong pants or
jeans made and sold by Levi’s Philippines, which included LEVI’S 501, were very
popular in the Philippines. The consuming public knew that the original LEVI’S 501
jeans were under a foreign brand and quite expensive. Such jeans could be purchased
only in malls or boutiques as ready-to-wear items, and were not available in tailoring
shops like those of Diaz’s as well as not acquired on a "made-to-order" basis. Under the
circumstances, the consuming public could easily discern if the jeans were original or
fake LEVI’S 501, or were manufactured by other brands of jeans.

Given the foregoing, it should be plain that there was no likelihood of confusion between
the trademarks involved. Thereby, the evidence of guilt did not satisfy the quantum of
proof required for a criminal conviction, which is proof beyond reasonable doubt.

(VICTORIO P. DIAZ, Petitioner, vs.
PEOPLE OF THE PHILIPPINES AND

LEVI STRAUSS [PHILS.], INC., G.R. No. 180677, February 18, 2013)

There are two types of confusion in trademark infringement:

1. Confusion of goods - when an otherwise prudent purchaser is induced to purchase one
product in the belief that he is purchasing another, in which case defendant’s goods are
then bought as the plaintiff’s and its poor quality reflects badly on the plaintiff’s reputation.
2. Confusion of business - when the goods of the parties are different but the defendant’s
product can reasonably (though mistakenly) be assumed to originate from the plaintiff,
thus deceiving the public into believing that there is some connection between the plaintiff
and defendant which, in fact, does not exist

Tests to Determine Confusing Similarity between Marks

Page 21 of 43
a. Dominancy Test - focuses on the similarity of the prevalent features of the competing
trademarks which might cause confusion or deception, and thus infringement.

b. 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.

Factors to consider what test to use:

1. age
2. training and education of the usual purchaser,
3. the nature and cost of the article,
4. whether the article is bought for immediate consumption and also the conditions
under which it is usually purchased.
BUT THE PRIMARY CONSDIRAITON IS THE COST OF THE GOODS.
It cannot be stressed enough that the products involved in the case at bar are, generally
speaking, various kinds of electronic products. These are not ordinary consumable
household items, like catsup, soy sauce or soap which are of minimal cost. The products
of the contending parties are relatively luxury items not easily considered affordable.
Accordingly, the casual buyer is predisposed to be more cautious and discriminating in
and would prefer to mull over his purchase. Confusion and deception, then, is less likely.

TAIWAN KOLIN CORP. LTD. V. KOLIN ELECTRONICS, CO., INC., G.R. NO.
209843, MARCH 25, 2015

“PAPA BOY” for lechon sauce v “PAPA KETSARAP” for banana catsup

“We agree that respondent’s mark (PAPA BOY) 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 casual purchaser.”
“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 not part of the
“PAPA” family of sauces, which is not unlikely, considering the nature of business that
petitioner is in.”

UFC Philippines, Inc;. v. Barrio Fiesta Manufacturing Corporation

LOLANE v. ORLANE

Absent any finding of its (colorable imitation) existence, there can be no likelihood of
confusion.

There are visual differences between LOLANE and ORLANE (marks) 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.

Seri Somboonsakdikul v. Orlane S.A., G.R. No. 188996, February 1, 2017

BOTH TESTS WERE USED:

“D-10 80 WP” versus NS D-10 PLUS

“Confusion is likely to occur applying the Dominancy Test. Likelihood of confusion is
more manifest when Holistic Test is applied.” Berries Agricultural Co., Inc. v. Norvy
Abyadang, G.R. No. 183404, October 13, 2010

SHARK v. SHARK
“Irrespective of both tests, the Court finds no confusing similarity between the subject

Page 22 of 43
 marks. While both marks use the shape of a shark, the Court noted distinct visual and aural
differences between them.” Great White Shark Enterprises, Inc. v Danilo Caralde, G.R.
No. 192294, Nov. 21, 2012

5. Is identical with, or confusingly similar to, or constitutes a translation of a WELL-

KNOWN mark whether or NOT IT IS REGISTERED here, used for IDENTICAL OR
SIMILAR goods or services. (Sec. 123.1[e])

6. Is identical with, or confusingly similar to, or constitutes a translation of a WELL-

KNOWN mark which IS REGISTERED in the Philippines with respect to goods or services
which are NOT SIMILAR. (Sec. 123.1[f])
“However, the Court cannot yet resolve the merits of the present controversy considering
that the requisites for the application of Section 123.1(f), which constitute the kernel issue
at bar, clearly require determination facts of which need to be resolved at the trial court.
The existence or absence of these requisites should be addressed in a full blown hearing
and not on a mere preliminary hearing.” 246 Corporation vs. Hon. Reynaldo B. Daway,
G.R. No. 157216, November 20, 2003

7. Is likely to mislead the public, particularly as to the nature, quality, characteristics or

geographical origin of the goods or services. (Sec. 123.1[g])

8. Consists exclusively of signs that are generic for the goods or services that they seek to
identify. (Sec. 123.1[h])

GSIS Family Bank - Thrift Bank [Formerly Comsavings Bank, Inc.], v. BPI Family
Bank, G.R. No. 175278, September 23, 2015

"GSIS Family Bank, a Thrift Bank." Versus “BPI Family Bank”

Issue: Is “Family Bank” generic?

Answer: NO.

Reason: By definition, there can be no expected relation between the word "family" and the
banking business of respondent. Rather, the words suggest that respondent's bank is where
family savings should be deposited.

Generic marks

Commonly used as the name or description of a kind of goods, such as "Lite" for beer or
"Chocolate Fudge" for chocolate soda drink.

Descriptive marks

Convey the characteristics, function, qualities or ingredients of a product to one who has
never seen it or does not know it exists, such as "Arthriticare" for arthritis medication.

Kensonic, Inc. v. Uni-Line Multi-Resources, Inc. G.R. No. 211820-21, June 6, 2018

Page 23 of 43
 Argument – SAKURA mark could not be appropriated because it simply referred to cherry
blossom in Japanese and was thus a generic name.

Ruling –

Such mark did not identify Kensonic’s goods unlike the mark in Asia Brewery, Inc. v. Court
of Appeals. Kensonic’s DVD or VCD players and other products could not be identified with
cherry blossoms.

Hence, the mark can be appropriated.

9. 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. (Sec. 123.1[i])

10. Consists exclusively of signs or of indications that may serve in trade to designate the
kind, quality, quantity, intended purpose, value, geographical origin, time or production of the
goods or rendering of the services, or other characteristics of the goods or services. (Sec.
123.1[j])

Question: St. Francis Square Commercial Center filed separate complaints against Shang
Properties Realty Corp. for unfair competition, false or fraudulent declaration, and
damages arising from the latter’s use and filing of applications for the registration of the
marks "THE ST. FRANCIS TOWERS" and "THE ST. FRANCIS SHANGRI-LA
PLACE."
In its complaints, St. Francis Commercial alleged that it has used the mark "ST.
FRANCIS" to identify its numerous property development projects located at Ortigas
Center, such as the aforementioned St. Francis Square Commercial Center, a shopping
mall called the "St. Francis Square," and a mixed-use realty project plan that includes
the St. Francis Towers.
Shang Properties denied committing unfair competition and false or fraudulent
declaration, maintaining that they could register the mark "THE ST. FRANCIS
TOWERS" and "THE ST. FRANCIS SHANGRI-LA PLACE" under their names. They
contended that respondent is barred from claiming ownership and exclusive use of the
mark "ST. FRANCIS" because the same is geographically descriptive of the goods or
services for which it is intended to be used. This is because respondent’s as well as
petitioners’ real estate development projects are located along the streets bearing the
name "St. Francis," particularly, St. Francis Avenue and St. Francis Street (now known
as Bank Drive), both within the vicinity of the Ortigas Center. Is Shang Properties liable
for unfair competition? Explain.
Suggested Answer: No. “St. Francis” is a descriptive geographical term, hence, there can
be no unfair competition. Such geographical term is in the ‘public domain’ in the sense
that every seller should have the right to inform customers of the geographical origin of
his goods.
A ‘geographically descriptive term’ is any noun or adjective that designates geographical
location and would tend to be regarded by buyers as descriptive of the geographic
location of origin of the goods or services. Shang Properties Realty Corporation v. St.
Francis Development Corporation, (2014)

11. 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. (Sec. 123.1[k])
12. Consists of color alone, unless defined by a given form. (Sec. 123.1[l])
13. Is contrary to public order or morality. (Sec. 123.1[m])

Rights Conferred by Registration

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 The owner of a 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 or services which are identical or similar to those in respect of
which the trademark is registered where such use would result in a likelihood of
confusion. In case of the use of an identical sign for identical goods or services, a
likelihood of confusion shall be presumed. (Sec. 147)

“A registered trademark owner may prevent third parties from using the mark. As Myra
correctly posits, as a registered trademark owner, it has the right under Section 147 of
R.A. No. 8293 to prevent third parties from using a trademark, or similar signs or
containers for goods or services, without its consent, identical or similar to its registered
trademark, where such use would result in a likelihood of confusion.” Dermaline Inc. v.
Myra Pharmaceuticals, Inc., G.R. No. 190065, August 16, 2010

BUT: Limitation on Medicines

“There shall be no infringement of trademarks or tradenames of imported or sold
patented drugs and medicines allowed under Section 72.1 of this Act, as well as
imported or sold off-patent drugs and medicines: Provided, That, said drugs and
medicines bear the registered marks that have not been tampered, unlawfully
modified, or infringed upon, under Section 155 of this Code.” (As amended by RA
9502)
Roma Drug and Romeo Rodriguez v. The Regional Trial Court of Guagua, (2009)

Limitation: BONAFIDE USE OF OWN NAMES, ETC.

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, provided that such use is
confined to the purposes of mere identification or information and cannot mislead the
public as to the source of the goods or services. (Sec. 148)
e.g.
Magnolia dela Cruz is selling “Magnolia Ice Candy”

Resident Agent

If the applicant is not domiciled or has no real and effective commercial establishment in
the Philippines, he shall designate by a written document filed in the office, the name and
address of a Philippine resident who may be served notices or process in proceedings
affecting the mark. Such notices or services may be served upon the person so designated
by leaving a copy thereof at the address specified in the last designation filed.

If the person so designated cannot be found at the address given in the last designation,
such notice or process may be served upon the Director. (Section 125)

IPAP v. Ochoa, G.R. No. 204605, July 19, 2016

Section 125 of the IP Code does not grant anyone in particular the right to represent the
foreign trademark applicant. Additionally, as the OSG points out in the comment, the
IPAP has misinterpreted Section 125 of the IP Code on the issue of representation. The
provision only states that a foreign trademark applicant "shall designate by a written
document filed in the office, the name and address of a Philippine resident who may be
served notices or process in proceedings affecting the mark;" it does not grant anyone in
particular the right to represent the foreign trademark applicant.

Page 25 of 43
 Hence, the IPAP cannot justly claim that it will suffer irreparable injury or diminution of
rights granted to it by Section 125 of the IP Code from the implementation of the Madrid
Protocol.

Rights Conferred by Registration

The owner of a 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 or services which are identical or similar to those in respect of which
the trademark is registered where such use would result in a likelihood of confusion.

Presumption:

In case of the use of an identical sign for identical goods or services, a likelihood of
confusion shall be presumed. (Sec. 147)

“A registered trademark owner may prevent third parties from using the mark. As Myra
correctly posits, as a registered trademark owner, it has the right under Section 147 of
R.A. No. 8293 to prevent third parties from using a trademark, or similar signs or
containers for goods or services, without its consent, identical or similar to its registered
trademark, where such use would result in a likelihood of confusion.” Dermaline Inc. v.
Myra Pharmaceuticals, Inc., G.R. No. 190065, August 16, 2010

BUT: Limitation on Medicines

“There shall be no infringement of trademarks or tradenames of imported or sold

patented drugs and medicines allowed under Section 72.1 of this Act, as well as imported
or sold off-patent drugs and medicines: Provided, That, said drugs and medicines bear the
registered marks that have not been tampered, unlawfully modified, or infringed
upon, under Section 155 of this Code.” (As amended by RA 9502)
Roma Drug and Romeo Rodriguez v. The Regional Trial Court of Guagua, (2009)

Trademark Infringement

Any person who shall, without the consent of the owner of the registered mark:
1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a
registered mark or the same container or a dominant feature thereof in connection with the
sale, offering for sale, distribution, advertising of any goods or services including other
preparatory steps necessary to carry out the sale of any goods or services on or in
connection with which such use is likely to cause confusion, or to cause mistake, or to
deceive; or
2. Reproduce, counterfeit, copy or colorably imitate a registered mark or a dominant
feature thereof and apply such reproduction, counterfeit, copy or colorable imitation to
labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be used
in commerce upon or in connection with the sale, offering for sale, distribution, or
advertising of goods or services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive, shall be liable in a civil action for
infringement, provided that the infringement takes place at the moment any of the acts
stated above are committed regardless of whether there is actual sale of goods or services
using the infringing material. (Sec. 155)
“As can be gleaned from the above provision, i.e., Section 155.1, mere unauthorized use
of a container bearing a registered trademark in connection with the sale, distribution or
advertising of goods or services which is likely to cause confusion, mistake or deception
among the buyers/consumers can be considered as trademark infringement.” William C.
Yao, et. al v. People of the Philippines, et. al, G.R. No. 168306, July 19, 2007

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 c. Damages

The owner of a registered mark may recover damages from any person who infringes his
rights. The measure of the damages suffered shall be either the reasonable profit which
the complaining party would have made, had the defendant not infringed his rights, or the
profit which the defendant actually made out of the infringement. In the event such
measure of damages cannot be readily ascertained with reasonable certainty, then the
court may award as damages a reasonable percentage based upon the amount of gross
sales of the defendant or the value of the services in connection with which the mark or
trade name was used in the infringement of the rights of the complaining party. (Sec.
156.1)

c. Requirement of Notice

“Sec. 158. Damages; Requirement of Notice. — In any suit for infringement, the
owner of the registered mark shall not be entitled to recover profits or damages
unless the acts have been committed with knowledge that such imitation is likely
to cause confusion, or to cause mistake, or to deceive. Such knowledge is presumed
if the registrant gives notice that his mark is registered by displaying with the mark
the words “Registered Mark” or the letter R within a circle or if the defendant had
otherwise actual notice of the registration.”

PREJUDICIAL QUESTION

Caterpillar, Inc. v. Manolo Samson, G.R. No. 164352, 205972, November 9, 2016

The civil cases are independent civil action that did not operate as a prejudicial question
to justify the suspension of the proceedings in Criminal Cases.

A common element of all such cases for unfair competition - civil and criminal - was
fraud. Under Article 33 of the Civil Code, a civil action entirely separate and distinct
from the criminal action may be brought by the injured party in cases of fraud, and such
civil action shall proceed independently of the criminal prosecution.

LIMITATIONS

1. Prior User
Thus, a registered mark shall have no effect against any person who, in good faith, before
the filing date or the priority date, was using the mark for the purposes of his business or
enterprise. (Sec. 159.1)
2. Printer of Infringing Mark
Where an infringer who is engaged solely in the business of printing the mark or other
infringing materials for others is an innocent infringer, the owner of the right infringed
shall be entitled as against such infringer only to an injunction against future printing.
(Sec. 159.2)
3. Advertisement
When the infringement complained of is contained in or is part of paid advertisement in a
newspaper, magazine, or other similar periodical or in an electronic communication, the
remedies of the owner of the right infringed as against the publisher or distributor of such
newspaper, magazine, or other similar periodical or electronic communication shall be
limited to an injunction against the presentation of such advertising matter in future issues
of such newspapers, magazines, or other similar periodicals or in future transmissions of
such electronic communications.
This limitation shall apply only to innocent infringers, provided that such injunctive relief
shall not be available to the owner of the right infringed with respect to an issue of a
newspaper, magazine, or other similar periodical or an electronic communication

Page 27 of 43
 containing infringing matter where restraining the dissemination of such infringing matter
in any particular issue of such periodical or in an electronic communication would delay
the delivery of such issue or transmission of such electronic communication is customarily
conducted in accordance with the sound business practice, and not due to any method or
device adopted to evade this section or to prevent or delay the issuance or an injunction or
restraining order with respect to such infringing matter. (Sec. 159.3)
4. Imported Drugs
Republic Act No. 9502 otherwise known as “Universally Accessible Cheaper and Quality
Medicines Act of 2008” provided another limitation to actions for infringement by adding
this paragraph:
“159.4 There shall be no infringement of trademarks or tradenames of
imported or sold drugs and medicines allowed under Section 72.1 of this Act, as
well as imported or sold off-patent drugs and medicines: Provided, That said
drugs and medicines bear the registered marks that have not been tampered,
unlawfully modified, or infringed upon as defined under Section 155 of this
Code.”

Unfair Competition

Elements
(1) confusing similarity in the general appearance of the goods, and
(2) intent to deceive the public and defraud a competitor.
The confusing similarity may or may not result from similarity in the marks, but
may result from other external factors in the packaging or presentation of the goods.
The intent to deceive and defraud may be inferred from the similarity of the
appearance of the goods as offered for sale to the public. Actual fraudulent intent
need not be shown. Mcdonald’s Corporation v. L.C. Big Mak Burger, Inc. (2004)

Difference between Unfair Competition and Trademark Infringement

1. Infringement of trademark is the unauthorized use of a trademark, whereas unfair

competition is the passing off of one's goods as those of another.
2. In infringement of trademark fraudulent intent is unnecessary, whereas in unfair
competition fraudulent intent is essential.
3. In infringement of trademark the prior registration of the trademark is a prerequisite to the
action, whereas in unfair competition registration is not necessary.

False Designations of Origin; False Description or Representation

Any person who, on or in connection with any goods or services, or any container for goods,
uses in commerce any word, term, name, symbol, or device, or any combination thereof, or
any false designation of origin, false or misleading description of fact, or false or misleading
representation of fact, which:
1. Is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation,
connection, or association of such person with another person, or as to the origin, sponsorship,
or approval of his or her goods, services, or commercial activities by another person; or
2. In commercial advertising or promotion, misrepresents the nature, characteristics,
qualities, or geographic origin of his or her or another person’s goods, services, or commercial
activities, shall be liable to a civil action for damages and injunction provided in Sections 156
and 157 of Republic Act No. 8293 by any person who believes that he or she is or likely to
be damaged by such act. (Sec. 169.1)
The products that Wintrade sold were admittedly produced in the Philippines, with no
authority from Casa Hipolito S.A. Portugal. We find no reversible error on the part of
the CA and the DOJ to merit reconsideration. The petitioners reiterate their argument
that the products bought during the test buy bearing the trademarks in question were not
manufactured by, or in any way connected with, the petitioners and/or Wintrade. They

Page 28 of 43
also allege that the words "Made in Portugal" and "Original Portugal" refer to the origin
of the design and not to the origin of the goods.

Thus, the evidence shows that petitioners, who are officers of Wintrade, placed the words
"Made in Portugal" and "Original Portugal" with the disputed marks knowing fully well
— because of their previous dealings with the Portuguese company — that these were
the marks used in the products of Casa Hipolito S.A. Portugal. More importantly, the
products that Wintrade sold were admittedly produced in the Philippines, with no
authority from Casa Hipolito S.A. Portugal. The law on trademarks and trade names
precisely precludes a person from profiting from the business reputation built by another
and from deceiving the public as to the origins of products. These facts support the
consistent findings of the State Prosecutor, the DOJ and the CA that probable cause exists
to charge the petitioners with false designation of origin. The fact that the evidence did
not come from Lo, but had been given by the petitioners, is of no significance.
The argument that the words "Made in Portugal" and "Original Portugal" refer to the
origin of the design and not to the origin of the goods does not negate the finding of
probable cause; at the same time, it is an argument that the petitioners are not barred by
this Resolution from raising as a defense during the hearing of the case.

Chester Uyco, Winston Uychiyong and Cherry C. Uyco-Ong v.
Vicente Lo, G.R.
No. 202423, January 28, 2013

Unfair Competition under the Civil Code

Facts: Both parties are competitors or trade rivals, both being engaged in the
manufacture of plastic-made automotive parts. Second, the acts of the petitioner were
clearly "contrary to good conscience" as petitioner admitted having employed
respondent’s former employees, deliberately copied respondent’s products and even
went to the extent of selling these products to respondent’s customers.

Ruling: The competition was “unfair” in this case. Article 28 of the Civil Code provides
that "unfair competition in agricultural, commercial or industrial enterprises or in labor
through the use of force, intimidation, deceit, machination or any other unjust,
oppressive or high-handed method shall give rise to a right of action by the person who
thereby suffers damage."

From the foregoing, it is clear that what is being sought to be prevented is not
competition per se but the use of unjust, oppressive or high- handed methods which may
deprive others of a fair chance to engage in business or to earn a living. Plainly, what
the law prohibits is unfair competition and not competition where the means used are
fair and legitimate.

In order to qualify the competition as "unfair," it must have two characteristics: (1) it
must involve an injury to a competitor or trade rival, and (2) it must involve acts which
are characterized as "contrary to good conscience," or "shocking to judicial
sensibilities," or otherwise unlawful; in the language of our law, these include force,
intimidation, deceit, machination or any other unjust, oppressive or high-handed
method. The public injury or interest is a minor factor; the essence of the matter appears
to be a private wrong perpetrated by unconscionable means.

Coca-Cola Bottlers, Phils., Inc. vs. Quintin J. Gomez (2008)

The petitioner theorizes that the above section does not limit the scope of protection on
the particular acts enumerated as it expands the meaning of unfair competition to include
"other acts contrary to good faith of a nature calculated to discredit the goods, business or
services of another."

Page 29 of 43
 Allegedly, the respondents' hoarding of Coca Cola empty bottles is one such act.
We do not agree with the petitioner's expansive interpretation of Section 168.3 (c). xxx
Hoarding as defined by the petitioner is not even an act within the contemplation of the
IP Code. Section 168 in its entirety states: xxx

Willaware Products Corporation v.
Jesichris Manufacturing Corporation, G.R.

No. 195549, September 3, 2014

Both parties are competitors or trade rivals, both being engaged in the manufacture of
plastic-made automotive parts. Second, the acts of the petitioner were clearly "contrary to
good conscience" as petitioner admitted having employed respondent’s former
employees, deliberately copied respondent’s products and even went to the extent
of selling these products to respondent’s customers.

Characteristics of Unfair Competition under the Civil Code

In order to qualify the competition as "unfair," it must have two characteristics:

(1) it must involve an injury to a competitor or trade rival, and
(2) it must involve acts which are characterized as "contrary to good conscience," or
"shocking to judicial sensibilities," or otherwise unlawful; in the language of our law,
these include force, intimidation, deceit, machination or any other unjust, oppressive or
high-handed method.

The public injury or interest is a minor factor; the essence of the matter appears to be a
private wrong perpetrated by unconscionable means.

False Designations of Origin; False Description or Representation

Any person who, on or in connection with any goods or services, or any container for
goods, uses in commerce any word, term, name, symbol, or device, or any combination
thereof, or any false designation of origin, false or misleading description of fact, or false
or misleading representation of fact, which:

False Designations of Origin; False Description or Representation

1. Is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation,

connection, or association of such person with another person, or as to the origin,
sponsorship, or approval of his or her goods, services, or commercial activities by another
person; or

2. In commercial advertising or promotion, misrepresents the nature, characteristics,

qualities, or geographic origin of his or her or another person’s goods, services, or
commercial activities, shall be liable to a civil action for damages and injunction provided
in Sections 156 and 157 of Republic Act No. 8293 by any person who believes that he or
she is or likely to be damaged by such act. (Sec. 169.1)

Law on Copyright (AS AMENDED BY RA 10372)

Copyright or ECONOMIC RIGHTS shall consist of the exclusive right to carry out,
authorize or prevent the following acts (SEC. 177):
1. REPRODUCTION of the work or substantial portion of the work;
2. Dramatization, TRANSLATION, adaptation, abridgment, arrangement or other
transformation of the work;
3. The FIRST PUBLIC DISTRIBUTION of the original and each copy of the work
by sale or other forms of transfer of ownership;

Page 30 of 43
 4. RENTAL of the original or a copy of an audio-visual 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;
5. PUBLIC DISPLAY of the original or a copy of the work;
6. PUBLIC PERFORMANCE of the work; and
7. OTHER COMMUNICATION to the public of the work.

REPRODUCTION

“Reproduction” is the making of one (1) or more copies, temporary or permanent, in

whole or in part, of a work or a sound recording in any manner or form without
prejudice to the provisions of Section 185 of Republic Act No. 8293. (Rep. Act No.
8293, Sec. 171.9 as amended by Rep. Act. No. 10372)

Prior to RA 10372

“Reproduction” is the making of one (1) or more copies of a work or a sound

recording in any manner or form. (Rep. Act No. 8293, Sec. 171.9)

Question:
Manny operates a computer shop. One of the services he offered is the downloading of songs
from the internet. He was told that he may be liable under the Intellectual Property Code. To
prevent that from happening, Manny tells his customer to delete the downloaded songs after
one week. Will this procedure absolve Manny from liabilities under the Law on Copyright?
Explain.

Answer:
No.
The definition of “Reproduction” under the Law on Copyright was amended to include
temporary making of copies. Hence, assuming that the downloaded songs are deleted after
one week, it will still constitute copyright infringement if the reproduction was done without
the consent of the owner of the copyright.
The reason is that copyright which is synonymous with economic rights consists of the
exclusive right to carry out, authorize or prevent certain acts, one of which is reproduction of
the work or substantial portion of the work.

Communication to the public

“Communication to the public” or ”communicate to the public” means any communication to
the public, including broadcasting, rebroadcasting, retransmitting by cable, broadcasting and
retransmitting by satellite, and includes the making of a work available to the public by wire
or wireless means in such a way that members of the public may access these works from a
place and time individually chosen by them. (Rep. Act No. 8293, Sec. 171.3 as amended by
Rep. Act. No. 10372)

Prior to RA 10372

“Communication to the public” or “communicate to the public” means the making of a work
available to the public by wire or wireless means in such a way that members of the public
may access these works from a place and time individually chosen by them. (Rep. Act No.
8293, Sec. 171.3)

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 Question:
The prized Filipino boxer Tanny Paksiw will fight the American undefeated champin Floy
Tumbling in the fight billed as the “Fight of the Century”. The boxing match will be
produced by HMO Boxing which shall own the copyright over the boxing match. It will
show the match in its channel HMO. During the match, ZMM Network rebroadcasted the
match without the consent of HMO. Assume that the case is decided under the Philippine
Copyright Law, is ZMM liable? Explain.

Answer:

Yes, ZMM is liable under the Law on Copyright.

The facts clearly show that ZMM communicated to the public the audio-visual work without
the consent of HMO Boxing. The definition of “Communication to the Public under the law
was amended to include broadcasting or rebroadcasting the work.
The reason is that copyright which is synonymous with economic rights consists of the
exclusive right to carry out, authorize or prevent certain acts, one of which is communication
to the public of the work.

2. Copyrightable Works

a. Original Works

Literary and artistic works, or simply “works” are original intellectual creations in the literary
and artistic domain and shall include in particular:
1. Books, pamphlets, articles and other writings;
2. Periodicals and newspapers;
3. Lectures, sermons, addresses, dissertations prepared for oral delivery, whether or not
reduced in writing or other material form;
4. Letters;
5. Dramatic or dramatico-musical compositions; choreographic works or entertainment in
dumb shows;
6. Musical compositions, with or without words;
7. Works of drawing, painting, architecture, sculpture, engraving, lithography or other
works of art; models or designs for works of art;
8. Original ornamental designs or models for articles of manufacture, whether or not
registrable as an industrial design, and other works of applied art;
9. Illustrations, maps, plans, sketches, charts and three-dimensional works relative to
geography, topography, architecture or science;
10. Drawings or plastic works of a scientific or technical character;
11. Photographic works including works produced by a process analogous to photography;
lantern slides;
12. Audiovisual works and cinematographic works and works produced by a process
analogous to cinematography or any process for making audio-visual recordings;
13. Pictorial illustrations and advertisements;
14. Computer programs; and
15. Other literary, scholarly, scientific and artistic works. (Sec. 172.1)

These 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. (Sec. 172.2)

IMPORTANT –

1. COPYRIGHT unlike patent and trademark is protected from moment of creation.

BUT IT HAS TO BE FIXATED.

Page 32 of 43
2. Protected irrespective of mode or form of express, as well as CONTENT,
QUALITY, and PURPOSE

Copyrightable Works

These 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. (Sec. 172.2)

Original Work

Being articles of manufacture already in existence, they cannot be deemed as original

creations. As earlier stated, valid copyright ownership denotes originality of the
copyrighted material. Originality means that the material was not copied, evidences at
least minimal creativity and was independently created by the author. It connotes
production as a result of independent labor.

LEC did not produce the door jambs and hinges; it bought or acquired them from
suppliers and thereafter affixed them to the hatch doors. No independent original creation
can be deduced from such acts. Sison Olaño, Sergio T. Ong, Marilyn O. Go, And Jap
Fuk Hai vs. Lim Eng Co, 2016

Artistic Works

From the foregoing description, it is clear that the hatch doors were not artistic works
within the meaning of copyright laws.

A hatch door, by its nature is an object of utility. It is defined as a small door, small gate
or an opening that resembles a window equipped with an escape for use in case of fire or
emergency. It is thus by nature, functional and utilitarian serving as egress access during
emergency. It is not primarily an artistic creation but rather an object of utility designed
to have aesthetic appeal. It is intrinsically a useful article, which, as a whole, is not
eligible for copyright. Sison Olaño, Sergio T. Ong, Marilyn O. Go, And Jap
Fuk Hai vs. Lim Eng Co, 2016

Useful Article

A "useful article" defined as an article "having an intrinsic utilitarian function that is not
merely to portray the appearance of the article or to convey information" is excluded
from copyright eligibility.

When Subject of Copyright Protection (DENICOLA Test)

The only instance when a useful article may be the subject of copyright protection is
when it incorporates a design element that is physically or conceptually separable from
the underlying product. This means that the utilitarian article can function without the
design element. In such an instance, the design element is eligible for copyright
protection.

Shall be considered a pictorial, graphic, or sculptural work only if, and only to the extent
that, such design incorporates pictorial, graphic, or sculptural features that can be
identified separately from, and are capable of existing independently of, the utilitarian
aspects of the article.

Belt –

Page 33 of 43
 A belt, being an object utility with the function of preventing one's pants from falling
down, is in itself not copyrightable. However, an ornately designed belt buckle which is
irrelevant to or did not enhance the belt's function hence, conceptually separable from the
belt, is eligible for copyright. It is copyrightable as a sculptural work with independent
aesthetic value, and not as an integral of the belt's functionality.

Table Lamp -

A table lamp is not copyrightable because it is a functional object intended for the
purpose of providing illumination in a room. The general shape of a table lamp is
likewise not copyrightable because it contributes to the lamp's ability to illuminate the
reaches of a room.

BUT, a lamp base in the form of a statue of male and female dancing figures made of
semi vitreous china is copyrightable as a work of art because it is unrelated to the lamp's
utilitarian function as a device used to combat darkness. Sison Olaño, Sergio T. Ong,
Marilyn O. Go, And Jap Fuk Hai vs. Lim Eng Co, 2016

Copyright is Distinct from Material Object

Copyright is distinct from the property in the material object subject to it. Consequently,
the transfer or assignment of the copyright shall not itself constitute a transfer of the
material object. Nor shall a transfer or assignment of the sole copy or of one or several
copies of the work imply transfer or assignment of the copyright. (Sec. 181)

a. Derivative Works (SEC. 173)

2 KINDS:

1. Dramatizations, TRANSLATIONS, adaptations, abridgments, arrangements, and other

alterations of literary or artistic works; and
2. 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.
These works shall be protected as a new works, provided, however that such new work shall
not affect the force of any subsisting copyright upon the original works employed or any
part thereof, or be construed to imply any right to such use of the original works, or to secure
or extend copyright in such original works.

Non-Copyrightable Works

No protection shall extend, under the law, to:

(1) 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;
(2) news of the day and other miscellaneous facts having the character of mere items of
press information;
(3) or any official text of a legislative, administrative or legal nature, as well as any official
translation thereof. (Sec. 175)

Sec. 176 – Works of the Government is also unprotected subject matter.

However, prior 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 a condition the payment of royalties.

Page 34 of 43
 EXCEPTION - 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.

RIGHT TO MAKE A COLLECTION OF HIS/HER WORK - However, it is the author of

speeches, lectures, sermons, addresses, and dissertations alone shall have the exclusive
right of making a collection of his works. (Sec. 176.2)

Estrella Domingo v. Civil Service Commission G.R. No. 236050, June 17, 2020

Under the law, the NAP (National Archive of the Phils.) materials were free to be
disseminated to the City of Bacoor stakeholders. Presenting the NAP materials to the City
of Bacoor is not an exploitation of the NAP materials for profit, but for the noble and
laudable cause of improving the basic records management of this local government unit.

EXCEPTION - 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.

Rules on Ownership of Copyright

1. GENERAL RULE - In the case of original literary and artistic works, copyright shall belong
to the author of the work. (Sec. 178.1)
2. 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. (Sec. 178.2)
3. IN THE COURSE OF EMPLOYMENT – same rule in PATENT OWNERSHIP
4. IN CASE OF COMMISSIONED WORK – NOT THE SAME AS PATENT OWNERSHIP.
COPYRIGHT belongs to the creator (author)
WORK belongs to the person who so commissioned the work

Transferability of Copyright
Copyright may be assigned in whole or in part. Within the scope of the assignment, the
assignee is entitled to all rights and remedies which the assignor had with respect to the
copyright. (Sec. 180)
The submission of a literary, photographic or artistic work to a newspaper, magazine or
periodical for publication shall constitute only a license to make a single publication unless
a greater right is expressly granted. If two (2) or more persons jointly own a copyright or
any part thereof, neither of the owners shall be entitled to grant licenses without the prior
written consent of the other owner or owners. (Sec. 180.3)
Bar 2008: Eloise, an accomplished writer, was hired by Petong to write a bimonthly
newspaper column for Diario de Manila, a newly-established newspaper of which Petong
was the editor-in-chief. Eloise was to be paid P1,000 for each column that was published.
In the course of two months, Eloise submitted three columns which, after some slight
editing, were printed in the newspaper. However, Diario de Manila proved unprofitable
and closed only after two months. Due to the minimal amounts involved, Eloise chose not
to pursue any claim for payment from the newspaper, which was owned by New Media
Enterprises.
Three years later, Eloise was planning to publish an anthology of her works, and wanted to
include the three columns that appeared in the Diario de Manila in her anthology. She asks
for your legal advice:

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 1. Does Eloise have to secure authorization from New Media Enterprises to be able to
publish her Diario de Manila columns in her own anthology? Explain fully.
SUGGESTED ANSWER:
No. Eloise owns the copyright over the columns and not New Media Enterprises. Her
submission of her columns for publication to the said media outfit only constituted a license
to make a single publication in the absence of showing of grant of greater right.

2. Assume that New Media Enterprises plans to publish Eloise’s columns in its own
anthology entitled, “The Best of Diaro de Manila.” Eloise wants to prevent the publication
of her columns in that anthology since she was never paid by the newspaper. Name one
irrefutable legal arguments Eloise could cite to enjoin New Media Enterprises from
including her columns in its anthology.

SUGGESTED ANSWER:
I would cite that it is Eloise who owns the copyright over the columns. As the owner of the
copyright, she can prevent others from exercising economic rights over her work including
arrangement and other transformation of the work. It must be noted that she only granted
the publication a license to make a single publication of her work.

Designation of Society (Sec. 183)

The owners of copyright and related rights or their heirs may designate a society of artists,
writers, composers and other right-holders to collectively manage their economic or moral
rights on their behalf. For the said societies to enforce the rights of their members, they
shall first secure the necessary accreditation from the Intellectual Property Office. (Sec.
183)

Question:

The Philippine Society of Song Composers (PSSC) was organized in order to enforce the
copyright of its members who are all Filipino songwriters. One of its members is Taylor
Swing, a noted singer-composer. She released her newest single “Happy Birthday To
Me”. She requires all business establishments to pay license fee if they want to use the
song in their establishments. ABC Mall uses the song without securing license from
Taylor Swing. The PSSC filed a case against ABC Mall. ABC Mall moved to dismiss the
case contending that the PSSC is not a party to the case since it cannot present a
certificate of copyright registration over the song. Can PSSC institute a case against ABC
Mall assuming that it does not have certificate of copyright registration? Explain.

Answer:

Yes, the PSSC can institute the case even without certificate of copyright registration
provided that it secured the necessary accreditation from the Intellectual Property Office.

Societies such as PSSC may be designated by the owners of copyright to enforce their
economic and moral rights. The absence of the copyright registration is not critical since
law provides that works are protected from the moment of their creation.

The question that needs to be answered thus is whether PSSC is accredited with the IPO
or not since that is required by the Intellectual Property Code, as amended.

Limitations on Copyright

The following acts shall not constitute infringement of copyright:

1. The recitation or performance of a work, once it has been lawfully made
accessible to the public, if done privately and free of charge or if made strictly for a
charitable or religious institution or society.

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 The work must therefore have been published and that publication must be lawfully
made. Note also the requirement of the purpose of the recitation or performance of the
work.
2. The making of quotations from a published work if they are compatible with fair
use and only to the extent justified for the purpose, including quotations from newspaper
articles and periodicals in the form of press summaries, provided that the source and the
name of the author, if appearing on the work, are mentioned.
Published works are those works, which, with the consent of the authors, are made
available to the public by wire or wireless means in such a way that members of the public
may access these works from a place and time individually chosen by them, provided that
availability of such copies has been such, as to satisfy the reasonable requirements of the
public, having regard to the nature of the work.
3. The reproduction or communication to the public by mass media of articles on current
political, social, economic, scientific or religious topic, lectures, addresses and other works
of the same nature, which are delivered in public if such use is for information purposes
and has not been expressly reserved, provided that the source is clearly indicated.
Reproduction is the making on one (1) or more copies of a work or a sound recording in
any manner or form.
4. The reproduction and communication to the public of literary, scientific or artistic
works as part of reports of current events by means of photography, cinematography or
broadcasting to the extent necessary for the purpose.
5. The inclusion of a work in a publication, broadcast, or other communication to the
public, sound recording or film, if such inclusion is made by way of illustration for teaching
purposes and is compatible with fair use, provided that the source and of the name of the
author, if appearing in the work, are mentioned.
6. The recording made in schools, universities, or educational institutions of a work
included in a broadcast for the use of such schools, universities or educational institutions,
provided that such recording must be deleted within a reasonable period after they were
first broadcast, provided further that such recording may not be made from audiovisual
works which are part of the general cinema repertoire of feature films except for brief
excerpts of the work.
7. The making of ephemeral recordings by a broadcasting organization by means of its
own facilities and for use in its own broadcast.
Thus, a short-lived sound clip from a song or a movie may be used in a radio broadcast
without infringing copyright.
8. The use made of a work by or under the direction or control of the Government, by
the National Library or by educational, scientific or professional institutions where such
use is in the public interest and is compatible with fair use.
This presupposes government’s use of a work for public interest. Unlike in the exercise
of power of eminent domain, no payment of just compensation is necessary for such use.
9. The public performance or the communication to the public of a work, in a place
where no admission fee is charged in respect of such public performance or
communication, by a club or institution for charitable or educational purpose only, whose
aim is not profit making, subject to such other limitations as may be provided in the
Regulations.
Communication to the public means the making of a work available to the public by wire
or wireless means in such a way that members of the public may access these works from
a place and time individually chosen by them.
10. Public display of the original or a copy of the work not made by means of a film,
slide, television image or otherwise on screen or by means of any other device or process,
provided that either the work has been published, or, that original or the copy displayed
has been sold, given away or otherwise transferred to another person by the author or his
successor in title.
11. Any use made of a work for the purpose of any judicial proceedings or for the giving
of professional advice by a legal practitioner.
ADD Limitation on Copyright (RA 10372)

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12. The reproduction or distribution of published articles or materials in a specialized
format exclusively for the use of the blind, visually- and reading-impaired persons:
Provided, That such copies and distribution shall be made on a nonprofit basis and shall
indicate the copyright owner and the date of the original publication. (Sec. 184.1[l])

Reproduction of Published Work

The private reproduction of a published work in a single copy, where the reproduction is
made by a natural person exclusively for research and private study, shall be permitted,
without the authorization of the owner of the copyright of the work. (Sec. 187.1)

The permission granted under Subsection 187.1 shall not extend to the reproduction of:
(a) A work of architecture in form of building or other construction
(b) An entire book, or a substantial part thereof, or of a musical work in which graphics
form by reprographic means;
(c) A compilation of data and other materials;
(d) A computer program
(e) Any work in cases where reproduction would unreasonably conflict with normal
exploitation of the work.

Bar 2019

KLM Printers, Inc. operated a small outlet located at the ground floor of a university
building in Quezon City. It possessed soft copies of certain textbooks on file, and would
print "book-alikes" of these textbooks (or in other words, reproduced the entire
textbooks) upon order and for a fee. It would even display samples of such "book-alikes"
in its stall for sale to the public.

Upon learning of KLM Printers, Inc.'s activities, the authors of the textbooks filed a suit
against it for copyright infringement. In its defense, KLM Printers, Inc. invoked the
doctrine of fair use, contending that the "book-alikes" are being used for educational
purposes by those who avail of them.

Is KLM Printers, Inc.'s invocation of the doctrine of fair use proper in this case? Explain.

Limitation for libraries

Any library or archive whose activities are not for profit may, without the authorization
of the author or copyright owner, make a limited number of copies of the work, as may
be necessary for such institutions to fulfill their mandate, by reprographic reproduction:
xxx
Where the making of such limited copies is in order to preserve and, if necessary in the
event that it is lost, destroyed or rendered unusable, replace a copy, or to replace, in the
permanent collection of another similar library or archive, a copy which has been lost,
destroyed or rendered unusable and copies are not available with the publisher. (Sec.
188.1)

Importation and Exportation of Infringing Materials

Subject to the approval of the Secretary of Finance, the Commissioner of Customs is

hereby empowered to make rules and regulations for preventing the importation or
exportation of infringing articles prohibited under the Law on Copyright and under
relevant treaties and conventions to which the Philippines may be a party and for seizing
and condemning and disposing of the same in case they are discovered after they have
been imported or before they are exported. (Sec. 191)

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Note that the provision allowing importation of a copy of work by an individual for his
personal purposes subject to certain conditions was deleted by Republic Act No. 10372.
Hence, one may now bring into the country more than three (3) copies of work on
condition that they were legally purchased abroad and subject further to the rules and
regulations to be imposed by the Commissioner of Customs.

Bar Exam 2014:

KKis from Bangkok, Thailand. She studies medicine in the Pontifical University of
Santo Tomas (UST). She learned that the same foreign books prescribed in UST are
40-50% cheaper in Bangkok. So she ordered 50 copies of each book for herself and
her classmates and sold the books at 20% less than the price in the Philippines. XX,
the exclusive licensed publisher of the books in the Philippines, sued KK for
copyright infringement. Decide

Doctrine of Fair Use (Sec. 185)

The fair use of a copyrighted work:

(1) for criticism, comment, news reporting, teaching including multiple copies
for classroom use, scholarship, research, and similar purposes is NOT AN
INFRINGEMENT OF COPYRIGHT.
Question:
Sam is a college literature professor. He taught his class how to appreciate classic and
modern literature. He included the short story of Lotie entitled “ANG LOTIE Mo AY
LOTIE KO”. If Sam reproduced a single copy said short story and gave the copy to his
student, did he commit copyright infringement? Explain.
Answer:
No, Sam did not commit copyright infringement. The act of Sam falls under fair use of
copyright since it was shown that the reproduction was for teaching purposes.

Question:
Supposing that Sam made multiple copies, will he be liable now for copyright
infringement? Explain.

Answer:
Still not. The law expressly provides that making multiple copies is still within the
purview of fair use as long as it was done for teaching purposes.

(2) Decompilation which is understood here to be the reproduction of the code and
translation of the forms of the computer program to achieve the inter-operability of
an independently created computer program with other programs may also
constitute fair use.
Question:
Sam is among those who, for a fee, offers services to “jailbreak” mobile devises using the
IOS operating system. They also provide similar services to android users. He was among
those who were sued by the copyright owner of the IOS operating system. Should Sam be
held liable for copyright infringement? Explain.
Answer:
No, Sam is not liable for copyright infringement.
Sam is providing a service which the law deems as decompilation. It essentially involves
reproduction of the code and translation of the program to achieve the inter-operability of
the program.
The law considers decompilation as fair use. The only effect may be the avoidance of the
warranty clause, if any.

Factors to consider:
(a) The purpose and character of the use, including whether such use is of a

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 commercial nature or is for non-profit educational purposes;
(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.
The fact that a work is unpublished shall not by itself bar a finding of fair use if
such finding is made upon consideration of all the above factors. (Sec. 185.2)

Copyright Infringement

A person infringes a right protected under this Act when one:

1. Directly commits an infringement;

2. Benefits from the infringing activity of another person who commits an infringement
if the person benefiting has been given notice of the infringing activity and has the right
and ability to control the activities of the other person; or

3. With knowledge of infringing activity, induces, causes or materially contributes to the

infringing conduct of another.

Question:

Mr. Jimmy Sin is the owner of Heaven Mall (HM). The mall houses many shops,
boutiques, restaurants, and many other establishments. There are also sellers of pirated
CDs and DVDs in one of the corners of the mall. Mario and his brother Luigi are renting
a space in HM where they sell pirated video games among others. Lorna convinced
Mario and Luigi to also venture in the selling of pirated movies in DVD and audios in
CD. In such a case, who are deemed liable for copyright infringement? Cite specific
reason why is/are he/she/they liable under the law.

Answer:

The brothers Mario and Luigi are clearly liable for copyright infringement. They are
directly committing infringement by selling pirated video games.

Lorna is also liable. She is shown to be inducing or causing others, particularly Mario and
Luigi, to commit infringement.

Mr. Jimmy Sin may not be held liable for copyright infringement. As the mall owner, he
is benefiting from the infringing activity of Mario and Luigi since they pay rent.
However, the element that he was given notice of the infringing activity and that he has
the right and ability to control the activities of Mario and Luigi was not shown.

Remedies for Infringement

(a) Circumvents effective technological measures; or

(b) Electronic rights management information has been removed or altered without
authority. (Sec. 216.1[b])

Effects:

1. The amount of damages to be awarded will be doubled.

2. Maximum penalty in criminal cases.

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 Remedies for Infringement

Any person infringing a right protected under this law shall be liable:
1. 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. (Sec. 216.1[a])
2. To 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: Provided, That the amount of damages to be awarded shall be
doubled against any person who:

(a) Circumvents effective technological measures; or

(b) Having reasonable grounds to know that it will induce, enable, facilitate or
conceal the infringement, remove or alter any electronic rights management
information from a copy of a work, sound recording, or fixation of a performance,
or distribute, import for distribution, broadcast, or communicate to the public works
or copies of works without authority, knowing that electronic rights management
information has been removed or altered without authority. (Sec. 216.1[b])

3. 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. (Sec. 216.1 [c])

4. 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. Sec. 216.1 [d])

5. 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. Sec.
216.1 [e])

The copyright owner may elect, at any time before final judgment is rendered, to recover
instead of actual damages and profits, an award of statutory damages for all infringements involved
in an action in a sum equivalent to the filing fee of the infringement action but not less than Fifty
thousand pesos (Php50,000.00). In awarding statutory damages, the court may consider the
following factors:

1. The nature and purpose of the infringing act;

2. The flagrancy of the infringement;
3. Whether the defendant acted in bad faith;
4. The need for deterrence;
5. Any loss that the plaintiff has suffered or is likely to suffer by reason of the
infringement; and
6. Any benefit shown to have accrued to the defendant by reason of the
infringement.

In case the infringer was not aware and had no reason to believe that his acts constitute an
infringement of copyright, the court in its discretion may reduce the award of statutory damages

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to a sum of not more than Ten thousand pesos (Php10,000.00), provided that the amount of
damages to be awarded shall be doubled against any person who:

1. Circumvents effective technological measures; or

2. Having reasonable grounds to know that it will induce, enable, facilitate or conceal the
infringement, remove or alter any electronic rights management information from a
copy of a work, sound recording, or fixation of a performance, or distribute, import for
distribution, broadcast, or communicate to the public works or copies of works without
authority, knowing that electronic rights management information has been removed
or altered without authority. (Sec. 216.1)

In an infringement action, the court shall also have the power to order the seizure
and impounding of any article which may serve as evidence in the court proceedings, in
accordance with the rules on search and seizure involving violations of intellectual
property rights issued by the Supreme Court.

The foregoing shall not preclude an independent suit for relief by the injured party
by way of damages, injunction, accounts or otherwise. (Sec. 216.2)

‘Technological measure’ means any technology, device or component that, in the normal
course of its operation, restricts acts in respect of a work, performance or sound recording,
which are not authorized by the authors, performers or producers of sound recordings
concerned or permitted by law. (Sec. 171.12 added by Rep. Act No. 10372)

‘Rights management information’ means information which identifies the work, sound
recording or performance; the author of the work, producer of the sound recording or
performer of the performance; the owner of any right in the work, sound recording or
performance; or information about the terms and conditions of the use of the work, sound
recording or performance; and any number or code that represent such information, when
any of these items is attached to a copy of the work, sound recording or fixation of
performance or appears in conjunction with the communication to the public of a work,
sound recording or performance. (Sec. 171.13 added by Rep. Act No. 10372)

Criminal Penalties

Any person infringing copyright or aiding or abetting such infringement shall be guilty of a
crime punishable by:
1. 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.
2. 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.
3. 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.

4. In all cases, subsidiary imprisonment in cases of insolvency.

In determining the number of years of imprisonment and the amount of fine, the court shall
consider the value of the infringing materials that the defendant has produced or manufactured and
the damage that the copyright owner has suffered by reason of the infringement, except that the
law provides that the respective maximum penalty stated above shall be imposed when the
infringement is committed by:

(a) the circumvention of effective technological measures;

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 (b) the removal or alteration of any electronic rights management information from a copy of
a work, sound recording, or fixation of a performance, by a person, knowingly and without
authority; or

(c) the distribution, importation for distribution, broadcast, or communication to the public of
works or copies of works, by a person without authority, knowing that electronic rights
management information has been removed or altered without authority. (Sec. 217)

Prescription

No damages may be recovered under this Act after the lapse of four (4) years from the time
the cause of action arose.

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