INTELLECTUAL PROPERTY

CODE

PART I
 GUIDE QUESTIONS
I.1. Differentiate trademark, copyright and patent from each other.
I.2. What is the doctrine of equivalents? Distinguish it from literal infringement.
I.3. Distinguish “First to File Rule” from “Right of Priority”.
I.4. Leonardo invented a device which, through the use of sanitized gel, can recharge a
cellphone battery. He applied and was granted a patent effective within the Philippines.
A year before, however, Brad had invented a similar device which he has been using at
his stall in Greenhills. Leonardo files a civil action for patent infringement against
Brad with prayer for preliminary injunction. Will the suit prosper? Why or why not?
I.5. The Pinoy Pharmaceutical Corporation (PPC) invented and patented a new
medicine for the cure of COVID-19 called Pinoy Ito Gamot or PIG-C19. PPC started
selling PIC-C19 at an exorbitant price that only a few could afford it. Because of the
emergency situation, the Department of Health (DOH) asked PPC for a license to
produce and sell PIC-C19 to the public at a substantially lower price. PPC citing
allegedly huge costs and expenses refused. As the legal consultant of the DOH, what
will you offer as remedy?
 GUIDE QUESTIONS
I.6. Dr. Medico discovered a new method of treating COVID-19 involving a
special method of diagnosing the disease, treating it with new medicine that
resulted from long experiments, clinical trials and field testing, and novel
measurable mind exercises. Can he apply for a patent for his new method of
diagnosis, new medicine and new method of treatment?
I.7. Dr. Medico applied for a patent for his new medicine but it was taking too
long that he instead filed an application for and obtained a copyright of “Staying
Alive” the name of his new medicine for COVID-19. What protection, if any,
does he have relative to his new medicine?
1.8. Matthew works as an auditor at the All Clean, Inc. (ACI). During office
hours, usually while waiting for his colleagues to arrive for their audit committee
meeting, he formulated a device that would enable the user to detect if there are
particular virus droplets or traces on any surface or object. After some time spent
both at the office and at home, he finally came up with such device that his lawyer
told him is patentable. Who has the right over the patent?
 COVERAGE

INTELLECTUAL PROPERTY RIGHTS, IN GENERAL

• Intellectual property rights
• Differences between copyright, trademarks and patents
• Technology transfer arrangement
PATENTS
• Patentable invention
• Non-patentable invention
• Ownership of a patent
• Right to a patent
• First to file rule
• Invention created pursuant to a commission
• Right of priority
• Grounds for cancellation of a patent
• Remedy of the true and actual inventor
 COVERAGE

• Rights conferred by a patent

• Limitations of patent rights
• Prior user
• Use by the government
• Patent infringement
• Tests in patent infringement
• Literal infringement
• Doctrine of equivalents
• Civil and criminal action
• Prescriptive period
• Defenses in action for infringement
• Licensing
• Voluntary
• Compulsory
• Assignment and transmission of rights
 INTELLECTUAL PROPERTY RIGHTS, IN GENERAL

• Sec. 4.1. Intellectual property rights consist of:

• Copyright and related rights

• Trademarks and service marks
• Geographic indications
• Industrial designs
• Patents
• Layout-Designs (Topographies) of Integrated Circuits; and
• Protection of Undisclosed Information (TRIPS)
 INTELLECTUAL PROPERTY RIGHTS, IN GENERAL

• Differences between
• Patents
• Trademarks
• Copyright

• Technology transfer arrangement

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

Kho v. Court of Appeals, G.R. No. 115758, [March 19, 2002], 429 PHIL 140-154
 TRADEMARK, COPYRIGHT AND PATENT

“Petitioner has no right to support her claim for the exclusive use of the subject
trade name and its container. The name and container of a beauty cream
product are proper subjects of a trademark inasmuch as the same fall squarely
within its definition. In order to be entitled to exclusively use the same in the sale
of the beauty cream product, the user must sufficiently prove that she registered
or used it before anybody else did. The petitioner's copyright and patent
registration of the name and container would not guarantee her the right to the
exclusive use of the same for the reason that they are not appropriate subjects of
the said intellectual rights. Consequently, a preliminary injunction order cannot
be issued for the reason that the petitioner has not proven that she has a clear
right over the said name and container to the exclusion of others, not having
proven that she has registered a trademark thereto or used the same before
anyone did.”
Kho v. Court of Appeals, G.R. No. 115758, [March 19, 2002], 429 PHIL 140-154
 TRADEMARK, COPYRIGHT AND PATENT

A patent is granted to provide rights and protection to the inventor after an

invention is disclosed to the public. It also seeks to restrain and prevent
unauthorized persons from unjustly profiting from a protected invention.
However, ideas not covered by a patent are free for the public to use and
exploit. Thus, there are procedural rules on the application and grant of
patents established to protect against any infringement. To balance the
public interests involved, failure to comply with strict procedural rules will
result in the failure to obtain a patent.

E.I. Dupont De Nemours and Co., et al v Director Emma C. Francisco, et al GR

174379 Aug 31, 2016, J. Leonen
 TRADEMARK, COPYRIGHT AND PATENT

“That the works of the petitioner may be the proper subject of a patent
does not entitle him to the issuance of a search warrant for violation of
copyright laws. In Kho v. Court of Appeals  and 
Pearl & Dean (Phil.), Incorporated v. Shoemart, Incorporated, the Court
ruled that ‘these copyright and patent rights are completely distinct and
separate from one another, and the protection afforded by one cannot be
used interchangeably to cover items or works that exclusively pertain to
the others’.” 

Ching v. Salinas Sr., G.R. No. 161295, [June 29, 2005], 500 PHIL 628-651
 TRADEMARK, COPYRIGHT AND PATENT
Being plain automotive spare parts that must conform to the original structural design of the
components they seek to replace, the Leaf Spring Eye Bushing and Vehicle Bearing Cushion are
not ornamental.  They lack the decorative quality or value that must characterize authentic
works of applied art.  They are not even artistic creations with incidental utilitarian functions or
works incorporated in a useful article.  In actuality, the personal properties described in the
search warrants are mechanical works, the principal function of which is utility sans any
aesthetic embellishment.

Neither are we to regard the Leaf Spring Eye Bushing and Vehicle Bearing Cushion as included
in the catch-all phrase “other literary, scholarly, scientific and artistic works” in Section 172.1(a)
of R.A. No. 8293.  Applying the principle of ejusdem generis which states that “where a statute
describes things of a particular class or kind accompanied by words of a generic character, the
generic word will usually be limited to things of a similar nature with those particularly
enumerated, unless there be something in the context of the state which would repel such
inference,”[46] the Leaf Spring Eye Bushing and Vehicle Bearing Cushion are not copyrightable,
being not of the same kind and nature as the works enumerated in Section 172 of R.A. No. 8293
JESSIE G. CHING V WILLIAM SALINAS, ET AL GR 161295 JUN 29, 2005
 TRADEMARK, COPYRIGHT AND PATENT

In Summerville General Merchandising Co., v CA, the SC clarified that in the issuance of a
search warrant involving the alleged violation of applicant’s intellectual property rights,
specifically unauthorized use of the design and Royal plastic case/container of Crown brand
playing cards, the seizure of hundreds of “Crown” playing cards was not warranted because:
We then said that assuming that the Crown playing cards could be considered subject of the
offense, a sample or two are more than enough to retain should there have been a need to
examine them along with the plastic container/case; and that there was no need to hold the
hundreds of articles seized. We said so in the context that since what was in dispute was the
design of the Royal plastic cases/containers of playing cards and not the playing card per se, a
small number of Crown brand playing cards would suffice to examine them with the Royal
plastic cases/containers. And the return of the playing cards would better serve the purposes of
justice and expediency.

Summerville General Merchandising Co., v CA, G.R. No. 158767, June 26, 2007, 525 SCRA 602,
cited in Century Chinese Medicine Co., et al v People et al, GR 188526, Nov 11, 2013
 TRADEMARK, COPYRIGHT AND PATENT
“The patent law has a three-fold purpose: ‘first, patent law seeks to foster and reward invention;
second, it promotes disclosures of inventions to stimulate further innovation and to permit the
public to practice the invention once the patent expires; third, the stringent requirements for patent
protection seek to ensure that ideas in the public domain remain there for the free use of the
public.’ It is only after an exhaustive examination by the patent office that a patent is issued. Such
an in-depth investigation is required because ‘in rewarding a useful invention, the rights and
welfare of the community must be fairly dealt with and effectively guarded. To that end, the
prerequisites to obtaining a patent are strictly observed and when a patent is issued, the
limitations on its exercise are equally strictly enforced. To begin with, a genuine invention or
discovery must be demonstrated lest in the constant demand for new appliances, the heavy hand of
tribute be laid on each slight technological advance in art.’ There is no such scrutiny in the case of
copyrights nor any notice published before its grant to the effect that a person is claiming the
creation of a work. The law confers the copyright from the moment of creation and the copyright
certificate is issued upon registration with the National Library of a sworn ex parte claim of
creation. Therefore, not having gone through the arduous examination for patents, the petitioner
cannot exclude others from the manufacture, sale or commercial use of the light boxes on the sole
basis of its copyright certificate over the technical drawings.”
Pearl & Dean (Phil.) v. Shoemart, G.R. No. 148222, [August 15, 2003], 456 PHIL 474-497
 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.
 PATENTABLE INVENTIONS

“Furthermore, Section 21 of R.A. 8293 declares: ‘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.’ Thus, the herein subject mark and
work can never be patented for the simple reason that it is not an
invention. It is a title of a music composition originated from the mind of
Mr. Santiago S. Suarez in 1942.”

Juan v. Juan, G.R. No. 221732, [August 23, 2017], 817 PHIL 192-208
 NON-PATENTABLE INVENTIONS
SEC. 22. Non-Patentable Inventions. - The following shall be excluded from patent
protection:
22.1. Discoveries, scientific theories and mathematical methods;
22.2. Schemes, rules and methods of performing mental acts, playing games or doing
business and programs for computers
22.3. Methods for treatment of the human or animal body by surgery or therapy and
diagnostic methods practiced on the human or animal body. This provision shall not apply to
products and composition for use in any of these methods;
22.4. Plant varieties or animal breeds or essentially biological process for the production of
plants or animal; This provision shall not apply to micro-organisms and non-biological and
microbiological processes.
Provisions under this subsection shall not preclude Congress to consider the enactment of a
law providing sui generis protection of plant varieties and animal breeds and a system of
community intellectual rights protection;
22.5. Aesthetic creations; and
22.6. Anything which is contrary to public order or morality.
 NOT PATENTABLE
”It has been repeatedly held that an invention must possess the essential elements of novelty,
originality and precedence and for the patentee to be entitled to protection, the invention must be
new to the world. Accordingly, a single instance of public use of the invention by a patentee for
more than two years (now for more than one year only under Sec. 9 of the Patent Law) before the
date of his application for his patent, will be fatal to the validity of the patent when issued. (Frank,
et al. v. Kosuyama; Vargas v. F.M. Yaptico & Co. and Vargas v. Chua, et al., supra).
“The law provides:
‘SEC. 9. Invention not considered new or patentable. — An invention shall not be considered new
or capable of being patented if it was known or used by others in the Philippines before the
invention thereof by the inventor named in an application for patent for the invention; or if it was
patented or described in any printed publication in the Philippines or any foreign country more
than one year before the application for a patent therefor; or if it had been in public use or on sale
in the Philippines for more than one year before the application for a patent therefor; or if it is the
subject matter of a validity issued patent in the Philippines granted on an application filed before
the filing of the application for patent therefor.’”

Maguan v. Court of Appeals, G.R. No. L-45101, [November 28, 1986], 230 PHIL 204-215
 NOT PATENTABLE
“As hereinbefore stated, the defendant relies on three special defenses. One such
defense, on which the judgment of the lower court is principally grounded, and to
which appellant devotes the major portion of his vigorous argument, concerns the
element of novelty, invention, or discovery, that gives existence to
the right to a patent. On this point the trial court reached the conclusion that ‘the
patented plow of the plaintiff, Exhibit D, is not different from the native plow,
Exhibit 2, except in the material, in the form, in the weight and the grade of the
result, the said differences giving it neither a new function nor a new result distinct
from the function and the result obtained from the native plow; consequently, its
production does not presuppose the exercise of the inventive faculty but merely of
mechanical skill, which does not give a right to a patent of an invention under the
provisions of the Patent Law.’ In thus finding, the court may have been right, since
the Vargas plow does not appear to be such a ‘combination’ as contains a novel
assemblage of parts exhibiting invention”. Vargas v. F. M. Yaptico & Co. (Ltd.),
G.R. No. 14101, [September 24, 1919], 40 PHIL 195-203
 RIGHT TO A PATENT

• SEC. 28. Right to a Patent

• Right to a patent belongs to inventor, his heirs or assigns.

When two or more persons have jointly made an
invention, the right to a patent shall belong to them jointly.
 FIRST TO FILE

Sec. 29 First to File Rule

• If two 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.

• Where two or more applications are filed for the same

invention, it belongs to the applicant who has

• the earliest filing date or,

• the earliest priority date

 INVENTION CREATED PURSUANT TO A COMMISSION

Sec. 30 Inventions Created Pursuant to a Commission

30.1. Person who commissions the work shall own the patent, unless contract
provides otherwise.

30.2. In case the employee made the invention in the course of his employment
contract, the patent shall belong to:

• 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;

• 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
 RIGHT OF PRIORITY

SEC. 31. Right of Priority

An application for patent filed by any person who has previously applied for the same
invention, or law affords similar privileges to Filipino citizens, shall be considered
filed as of date of filing the foreign application provided that the:

• Local application expressly claims priority;

• Local application was filed within 12 months from the date the earliest foreign
application was filed; and

• Certified true copy of foreign application with English translation is filed within
6 months from the date of filing in the Philippines.
 RIGHT OF PRIORITY
J. LEONEN

“A patent applicant with the right of priority is given preference in the grant of a patent when there are two or more
applicants for the same invention. Section 29 of the Intellectual Property Code provides:
SECTION 29. First to File Rule. — 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.
Since both the United States and the Philippines are signatories to the Paris Convention for the Protection of Industrial
Property, an applicant who has filed a patent application in the United States may have a right of priority over the
same invention in a patent application in the Philippines.  However, this right of priority does not immediately entitle a
patent applicant the grant of a patent. A right of priority is not equivalent to a patent. Otherwise, a patent holder of
any member-state of the Paris Convention need not apply for patents in other countries where it wishes to exercise its
patent. 
It was, therefore, inaccurate for petitioner to argue that its prior patent application in the United States removed the
invention from the public domain in the Philippines. This argument is only relevant if respondent Therapharma, Inc.
had a conflicting patent application with the Intellectual Property Office. A right of priority has no bearing in a case for
revival of an abandoned patent application.”

(E.I. Dupont De Nemours and Co. v. Francisco, G.R. No. 174379, [August 31, 2016], 794 PHIL 97-148)
 GROUNDS FOR CANCELLATION OF A PATENT

SEC. 61. Cancellation of Patents.- 61.1. Any interested person may, upon
payment of the required fee, petition to cancel the patent or any claim thereof, or
parts of the claim, on any of the following grounds:

• That what is claimed as the invention is not new or patentable;

• That the patent does not disclose the invention in a manner sufficiently clear and complete
for it to be carried out by any person skilled in the art; or

• That the patent is contrary to public order or morality.

61.2. Where the grounds for cancellation relate to some of the claims or parts of it,
cancellation may be effected to such extent only.
 PROCEDURE FOR CANCELLATION
• File petition
• Hearing with notice to specific persons and publication
• May be heard and decided by Committee of three in cases involving highly
technical issues upon motion
• Appealable to Director-General
• If proved, patent or any specified claim or claims cancelled
• If patentee amended during cancellation proceedings, Committee may decide to maintain
the patent as amended
• If patent amended, Bureau shall publish mention of cancellation decision, publish the
abstract, representative claims and drawings indicating that the amendments consist of
• No fee for printing of new patent, revoked
• If cancelled, rights terminated
• Notice of cancellation published in IPO Gazette
• Immediately executory pending appeal unless restrained by Director General
 REMEDIES OF THE TRUE AND ACTUAL INVENTOR

SEC.68 Remedies of the True and Actual Inventor. - If a person, who was
deprived of the patent without his consent or through fraud is declared by
final court order or decision to be the true and actual inventor, the court shall

• order for his substitution as patentee, or

• at the option of the true inventor, cancel the patent, and

• award actual and other damages in his favor is warranted by the

circumstances.
 RIGHTS CONFERRED BY A PATENT
SEC. 71. Rights Conferred by Patent.
71.1. A patent shall confer on its owner the following exclusive rights:

(a) Where the subject matter of a patent is a product, to restrain, prohibit and prevent
unauthorized person or entity from making, using, offering for sale, selling or importing
that product;

(b) Where the subject matter of a patent is a process, to restrain, prevent or prohibit any
unauthorized person or entity from using the process and from manufacturing, dealing
in, using, selling or offering for sale, or importing any product obtained directly or
indirectly from such process.

71.2. Patent owners shall also have the right to assign, or transfer by succession
the patent, and to conclude licensing contracts for the same.
 RIGHTS CONFERRED BY A PATENT
J. LEONEN

A patent is granted to provide rights and protection to the inventor after

an invention is disclosed to the public. It also seeks to restrain and
prevent unauthorized persons from unjustly profiting from a protected
invention. However, ideas not covered by a patent are free for the public
to use and exploit. Thus, there are procedural rules on the application
and grant of patents established to protect against any infringement. To
balance the public interests involved, failure to comply with strict
procedural rules will result in the failure to obtain a patent. 

E.I. Dupont De Nemours and Co. v. Francisco, G.R. No. 174379, [August
31, 2016], 794 PHIL 97-148
 RIGHTS CONFERRED BY A PATENT
J. LEONEN
The grant of a patent is to provide protection to any inventor from any patent infringement. Once an
invention is disclosed to the public, only the patent holder has the exclusive right to manufacture,
utilize, and market the invention. In Creser Precision Systems v. Court of Appeals:
Under American jurisprudence, an inventor has no common-law right to a monopoly of his
invention. He has the right to make, use and vend his own invention, but if he voluntarily discloses
it, such as by offering it for sale, the world is free to copy and use it with impunity. A patent,
however, gives the inventor the right to exclude all others. As a patentee, he has the exclusive right
of making, using or selling the invention. 
Under the Intellectual Property Code, a patent holder has the right to ‘to restrain, prohibit and
prevent’  any unauthorized person or entity from manufacturing, selling, or importing any product
derived from the patent. However, after a patent is granted and published in the Intellectual
Property Office Gazette, any interested third party ‘may inspect the complete description, claims,
and drawings of the patent.’ 

E.I. Dupont De Nemours and Co. v. Francisco, G.R. No. 174379, [August 31, 2016], 794 PHIL 97-148
 RIGHTS CONFERRED BY A PATENT

J. LEONEN

The grant of a patent provides protection to the patent holder from the
indiscriminate use of the invention. However, its mandatory publication also
has the correlative effect of bringing new ideas into the public consciousness.
After the publication of the patent, any person may examine the invention and
develop it into something further than what the original patent holder may
have envisioned. After the lapse of 20 years, the invention becomes part of the
public domain and is free for the public to use.

E.I. Dupont De Nemours and Co. v. Francisco, G.R. No. 174379, [August 31,
2016], 794 PHIL 97-148
 RIGHTS CONFERRED BY A PATENT

Thus, as correctly ruled by the respondent Court of Appeals in its

assailed decision: ‘since the petitioner (private respondent herein) is the
patentee of the disputed invention embraced by letters of patent UM
No.6938 issued to it on January 23, 1990 by the Bureau of Patents, it
has in its favor not only the presumption of validity of its patent, but that
of a legal and factual first and true inventor of the invention.’

Creser Precision Systems, Inc. v. Court of Appeals, G.R. No. 118708,

[February 2, 1998], 349 PHIL 687-697
 NO PATENT, NO PROTECTION (OF RIGHTS)
For some reason or another, petitioner never secured a patent for the light boxes. It therefore acquired
no patent rights which could have protected its invention, if in fact it really was. And because it had no
patent, petitioner could not legally prevent anyone from manufacturing or commercially using the
contraption. In Creser Precision Systems, Inc. vs. Court of Appeals, we held that "there can be no
infringement of a patent until a patent has been issued, since whatever right one has to the invention
covered by the patent arises alone from the grant of patent. . . . (A)n inventor has no common law right
to a monopoly of his invention. He has the right to make use of and vend his invention, but if he
voluntarily discloses it, such as by offering it for sale, the world is free to copy and use it with impunity.
A patent, however, gives the inventor the right to exclude all others. As a patentee, he has the exclusive
right of making, selling or using the invention. On the assumption that petitioner's advertising units
were patentable inventions, petitioner revealed them fully to the public by submitting the engineering
drawings thereof to the National Library. To be able to effectively and legally preclude others from
copying and profiting from the invention, a patent is a primordial requirement. No patent, no
protection. The ultimate goal of a patent system is to bring new designs and technologies into the
public domain through disclosure. Ideas, once disclosed to the public without the protection of a valid
patent, are subject to appropriation without significant restraint.

Pearl & Dean (Phil.) v. Shoemart, G.R. No. 148222, [August 15, 2003], 456 PHIL 474-497
 LIMITATIONS OF PATENT RIGHTS

SEC. 72. Limitations of Patent Rights. – The owner of a patent has no right to prevent
third parties from performing, without his authorization, the acts referred to in Section 71
hereof (Rights Conferred by a Patent) in the following circumstances:

• Using a patented product which has been put on the Philippine market by the owner
of the product, or with his express consent, insofar as such use is performed after
the product has been so put on the said market. Provided that:

• With regard to drugs and medicines, the limitation on patent rights shall apply after a drug or
medicine has been introduced in the Philippines or anywhere else in the world by the patent
owner or by any party authorized to use the invention.; 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.
 LIMITATIONS OF PATENT RIGHTS
• Where the act is done privately and on non-commercial scale or for a non-commercial purpose provided that it
does not significantly prejudice the economic interests of the owner of the patent.
• Where the act consists of making or using exclusively for experimental use of the invesntion for scientific
purposes or educational purposes and such other activities directly related to such scientific or educational
experimental use.
• In case of drugs or medicines, where the act includes testing, using, making or selling the invention including
any data related thereto, solely for purposes reasonably related to the development and submission of
information and issuance of approval 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;
provided that in order to protect the data submitted by the original patent holder from unfair commercial use
provided in Art 39.3 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS
Agreements), the Intellectual Property Office, in consultation with the appropriate government agencies, shall
issue the appropriate rules and regulations necessary thereon not later than 20 days after the enactment the law;
• 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
• Where the invention is used in any ship, vessel, aircraft or land vehicle of any other country entering the
territory of the Philippines temporarily or accidentally provided such invention is used exclusively for the needs
of the ship, vessel, aircraft, or land vehicle and not used for the manufacturing of anything sold within the
Philippines.
 LIMITATIONS OF PATENT RIGHTS
SEC. 73 Prior User. –

73.1. Notwithstanding Section 72 hereof, any prior user, who, in good faith
was using the invention or has undertaken serious preparations to use the
invention in his enterprise or business before the filing date or priority date of
the application on which a patent is granted, shall have the right to continue
the use thereof as envisaged in such preparations within the territory where
the patent produces its effect.

73.2. The right of the prior user may only be transferred or assigned together
with his enterprise or business, or with that part of his enterprise or business
in which the use or preparations for use have been made.
 LIMITATIONS OF PATENT RIGHTS
SEC. 74. Use of Invention by Government. –
74.1 A government agency or third person authorized by the Government may exploit
the invention even without agreement of the patent owner where:
(a) The public interest, in particular, national security, nutrition, heath or the
development of other sector, as determined by the appropriate agency of the
government, so requires; or
(b) A judicial or administrative body has determined that the manner of exploitation, by
the owner of the patent or his licensee, is anti-competitive.
(c) In the case of drugs and medicines, there is a national emergency or other
circumstance of extreme urgency requiring the use of the inestion or
(d) In the case of drugs and medicines, there is public non-commercial use of the patent
by the patentee, without satisfactory reason; or
(e) In the case of the drugs and medicines, the demand for the patented article in the
Philippines is not being met to an adequate extent and on reasonable terms as
determined by the Secretary of Health.
 LIMITATIONS OF PATENT RIGHTS
74.2. Unless otherwise provided herein, the use by the Government, or third
person authorized by Government shall be subject, where applicable, to the
following provisions:
(a) In situations of national emergency or other circumstances of extreme
emergency or other circumstances of extreme urgency as provided under
Section 74.1 ( c), the right holder shall be notified as soon as reasonably
practicable;
(b) In the case of public non-commercial use of the patent by the patentee,
without satisfactory reason, as provided under Sec 74.1 (d), the right holder
shall be informed promptly; Provided, that, the Government or third person
authorized by the Government, without making a patent search, knows or has
demonstrable ground to know that a valid patent is or will be used by or for
the Government;
 LIMITATIONS OF PATENT RIGHTS

( c) if the demand for the patented article in the Philippins is not being met to
an adequate extent and on reasonable terms as provided under Sec 74.1 ( e),
the right holder shall be informed promptly
( d) The scope and duration of such use shall be liited to the purpose for
which it was authorized;
( e) Such use shall be non-exclusive;
( f) The right holder shall be paid adequate remuneration in the circumstances
of each case taking into account the economic value of the authorization; and
( g) the existence of a national emergency or other circumstnaces of extreme
emergency referred in Sec 74.1 ( c) shall be subject to the determination of
the President of the Philippines for the purpose of determining the need for
such use or other exploitation which shall be immediately executory.
 PATENT INFRINGEMENT

DEFINITION
• making, using, offering for sale, selling, importing a
patented product or product obtained directly or indirectly
from a patented process, or the use of a patented process
without the authorization of the patentee

TESTS IN PATENT INFRINGMENT

• Literal infringement
• Doctrine of equivalents
 LITERAL INFRINGEMENT

Tests have been established to determine infringement. These are

(a) literal infringement; and (b) the doctrine of equivalents.[7] In
using literal infringement as a test, "x x x resort must be had, in the
first instance, to the words of the claim. If accused matter clearly falls within
the claim, infringement is made out and that is the end of it."[8] To determine
whether the particular item falls within the literal meaning of the patent
claims, the Court must juxtapose the claims of the patent and the accused
product within the overall context of the claims and specifications, to
determine whether there is exact identity of all material elements.

(Godines v. Court of Appeals, G.R. No. 97343, [September 13, 1993])

 DOCTRINE OF EQUIVALENTS
Recognizing that the logical fallback position of one in the place of defendant is to
aver that his product is different from the patented one, courts have adopted the
doctrine of equivalents which recognizes that minor modifications in a patented
invention are sufficient to put the item beyond the scope of literal infringement.[12]
 Thus, according to this doctrine, "(a)n infringement also occurs when a device
appropriates a prior invention by incorporating its innovative concept and, albeit
with some modification and change, performs substantially the same function in
substantially the same way to achieve substantially the same result."[13] The
reason for the doctrine of equivalents is that to permit the imitation of a patented
invention which does not copy any literal detail would be to convert the protection
of the patent grant into a hollow and useless thing. Such imitation would leave
room for - indeed encourage - the unscrupulous copyist to make unimportant
and insubstantial changes and substitutions in the patent which, though adding
nothing, would be enough to take the copied matter outside the claim, and hence
outside the reach of the law
(Godines v. Court of Appeals, G.R. No. 97343, [September 13, 1993])
 DOCTRINE OF EQUIVALENTS
“The doctrine of equivalents provides that an infringement also takes place when a
device appropriates a prior invention by incorporating its innovative concept and,
although with some modification and change, performs substantially the same
function in substantially the same way to achieve substantially the same result. Yet
again, a scrutiny of petitioner's evidence fails to convince this Court of the
substantial sameness of petitioner's patented compound and Albendazole. While
both compounds have the effect of neutralizing parasites in animals, identity of
result does not amount to infringement of patent unless Albendazole operates in
substantially the same way or by substantially the same means as the patented
compound, even though it performs the same function and achieves the same
result. In other words, the principle or mode of operation must be the same or
substantially the same.
Smith Kline Beckman Corp. v. Court of Appeals, G.R. No. 126627, [August 14, 2003],
456 PHIL 213-226
 DOCTRINE OF EQUIVALENTS

The doctrine of equivalents thus requires satisfaction of the function-means-

and-result test, the patentee having the burden to show that all three
components of such equivalency test are met. As stated early on, petitioner's
evidence fails to explain how Albendazole is in every essential detail
identical to methyl 5 propylthio-2-benzimidazole carbamate. Apart from the
fact that Albendazole is an anthelmintic agent like methyl 5 propylthio-2-
benzimidazole carbamate, nothing more is asserted and accordingly
substantiated regarding the method or means by which Albendazole weeds
out parasites in animals, thus giving no information on whether that method
is substantially the same as the manner by which petitioner's compound
works. “
Smith Kline Beckman Corp. v. Court of Appeals, G.R. No. 126627, [August
14, 2003], 456 PHIL 213-226
 CIVIL ACTION FOR PATENT INFRINGEMENT

Patentee or anyone possessing right, title or interest into patented invention, whose
rights are infringed may bring a civil action:
• To recover damages sustained, attorney’s fees and expenses of litigation
• if damages are inadequate or cannot be readily ascertained with reasonable
certainty, sum equivalent to reasonable royalty
• Court may according to circumstances award damages in a sum above the
amount found as actual damages sustained provided that the award does not
exceed 3 times the amount of actual damages
• No damages if acts of infringement committed more than 4 years before
institution of action
• No damages where acts committed before the infringer had known or had
reasonable grounds to know of the patent. He is presumed to have known where
the container or package or material advertising, indicate the words “Philippine
Patent” with number of the patent
 CIVIL ACTION FOR PATENT INFRINGEMENT
• To secure an injunction for the protection of his rights
• Court may order in its discretion that the infringing goods, materials and implements
predominantly used in the infringement be disposed outside the channels of
commerce or destroyed without compensation.

• 76.6. Anyone who actively induces infringement of a patent or provides the infringer with a
component of a patented product or of a product produced because of a patented process
knowing it to be especially adopted for infringing the patented invention and not suitable for
substantial non-infringing use shall be liable as a contributory infringer and shall be jointly
and severally liable with the infringer.

• SEC. 77. Infringement Action by a Foreign National. – Any foreign national or juridical entity
who meets the requirements of Section3 and not engaged in business in the Philippies, to
which a patent has been granted or assigned under this Act, may bring an action for
infringement of patent, whether or not it is licensed to do business in the Philippines under
existing law.
 CRIMINAL ACTION FOR PATENT INFRINGEMENT
SE. 84. Criminal Action for Repetition of Infringement

• Repeated by infringer or anyone in connivance with him

• After finality of judgment against infringer

• Offenders shall, without prejudice to the institution of a civil action for damages

• Be criminally liable and upon conviction shall suffer, at the discretion of the
court:
• Imprisonment from 6 months to 3 years and/or
• Fine from P100,000 to P300,000

• Action prescribes in 3 years from date of commission of crime

 PRESCRIPTIVE PERIOD

SEC. 79. Limitation of Action for Damages. – No damages can be

recovered for acts of infringement committed more than four (4)
years before the institution of the action for infringement.
 DEFENSES IN ACTION FOR INFRINGEMENT

SEC. 81. Defenses in action for infringement. – In an action for

infringement, the defendant, in addition to other defenses available to
him, may show the invalidity of the patent, or any claim thereof, on any
of the grounds on which a petition for cancellation can be brought under
Section 61 hereof. (e.g. not new or patentable; does not disclose the
invention in sufficiently clear and complete manner; contrary to pubic
order or morality
 DEFENSES IN PATENT INFRINGEMENT
“The first issue has been laid to rest in a number of cases where the Court ruled that "When a patent is
sought to be enforced, the questions of invention, novelty or prior use, and each of them, are open to
judicial examination." (Vargas v. F.M. Yaptico & Co. 40 Phil. 199 [1919]; Vargas v. Chua, 57 Phil. 790-
791 [1933]; Frank and Gohn v. Kosuyana, 59 Phil. 207 [1933].
Under the present Patent Law, there is even less reason to doubt that the trial court has jurisdiction to
declare the patents in question invalid. A patentee shall have the exclusive right to make, use and sell the
patented article or product and the making, using, or selling by any person without the authorization of
the patentee constitutes infringement of the patent (Sec. 37, R.A. 165). Any patentee whose rights have
been infringed upon may bring an action before the proper CFI now (RTC) and to secure an injunction
for the protection of his rights (Sec. 42, R.A. 165). Defenses in an action for infringement are provided
for in Section 45 of the same law which in fact were availed of by private respondent in this case. Then,
as correctly stated by respondent Court of Appeals, this conclusion is reinforced by Sec. 46 of the same
law which provides that if the Court "shall find the patent or any claim thereof invalid, the Director shall
on certification of the final judgment . . . issue an order cancelling the patent or the claims found invalid
and shall publish a notice thereof in the Official Gazette." Upon such certification, it is ministerial on
the part of the patent office to execute the judgment. (Rollo, pp. 221-222).”

(Maguan v. Court of Appeals, G.R. No. L-45101, [November 28, 1986], 230 PHIL 204-215)
 WHO CAN FILE AN ACTION FOR PATENT INFRINGEMENT

“Section 42 of R.A. 165, otherwise known as the Patent Law, explicitly provides . .
. that only the patentee or his successors-in-interest may file an action for
infringement. The phrase "anyone possessing any right, title or interest in and to
the patented invention" upon which petitioner maintains its present suit, refers
only to the patentee's successors-in-interest, assignees or grantees since actions
for infringement of patent may be brought in the same of the person or persons
interested, whether as patentee, assignees, or as grantees, of the exclusive right.
Moreover, there can be no infringement of a patent until a patent has been issued,
since whatever right one has to the invention covered by the patent arises alone
from the grant of patent. In short, a person or entity who has not been granted
letters patent over an invention and has not acquired any right or title thereto
either as assignee or as licensee, has no cause of action for infringement because
the right to maintain an infringement suit depends on the existence of the patent.”
(Creser Precision Systems, Inc. v. Court of Appeals, G.R. No. 118708, [February
2, 1998], 349 PHIL 687-697)
 WHO CAN FILE AN ACTION FOR PATENT INFRINGEMENT

“The remedy of declaratory judgment or injunctive suit on patent invalidity relied upon by
petitioner cannot be likened to the civil action for infringement under Section 42 of the Patent
Law. The reason for this is that the said remedy is available only to the patent holder or his
successors-in-interest. Thus, anyone who has no patent over an invention but claims to have a
right or interest thereto can not file an action for declaratory judgment or injunctive suit which
is not recognized in this jurisdiction. Said person, however, is not left without any remedy. He
can, under Section 28 of the aforementioned law, file a petition
for cancellation of the patent within three (3) years from the publication of said patent with the
Director of Patents and raise as ground therefor that the person to whom the patent was issued
is not the true and actual inventor. Hence, petitioner's remedy is not to file an action for
injunction or infringement but to file a petition for cancellation of private respondent's patent.
Petitioner however failed to do so. As such, it can not now assail or impugn the validity of the
private respondent's letters patent by claiming that it is the true and actual inventor of
the aerial fuze.” 
(Creser Precision Systems, Inc. v. Court of Appeals, G.R. No. 118708, [February 2, 1998], 349
PHIL 687-697)
 CANCELLATION OF PATENT v PATENT INFRINGEMENT
“Petitioner-appellant contends that the Director of Patents erred in not accepting as final
and conclusive the findings of fact of the Court of Appeals, namely, that the petitioner was
the prior user of the design in question, and that designs in Letters Patent Nos. 6 and 7 are
not new and original. The director of Patents held that these findings are not ‘clear’,
‘satisfactory’ and ‘free from doubt.’
“The pivotal issue that arises is whether or not the Director of Patents is bound in the
cancellation proceedings by the findings arrived at by the Court of Appeals in the criminal
case against petitioner. The answer is in the negative. In the cancellation proceedings the
question refers to the validity of the design patents issued to respondent Jose Ong Lian Bio,
while in the criminal case the inquiry is whether Co San unfairly competed against the
luggage of said respondent protected by design patent No. 7. The first is within the
cognizance of the Patent Office (Section 28, Republic Act No. 160, as amended); the second
under the jurisdiction of the court of first instance (Article 189, Revised Penal Code, as
amended by Republic Act 172). The acquittal of the petitioner by the Court of Appeals was
not based on the cancellation of a patent, but on the opinion that the accused (petitioner)
had not deceived or defrauded the complainant (respondent).”
(Co San v. Director of Patents, G.R. No. L-10563, [February 23, 1961], 111 PHIL 116-119)
 PATENT INFRINGEMENT v UNFAIR COMPETITION
“There is evidently no mention of any crime of "unfair competition" involving design
patents in the controlling provisions on Unfair Competition. It is therefore unclear
whether the crime exists at all, for the enactment of RA 8293 did not result in the
reenactment of Art. 189 of the Revised Penal Code. In the face of this ambiguity, we must
strictly construe the statute against the State and liberally in favor of the accused, for
penal statutes cannot be enlarged or extended by intendment, implication or any
equitable consideration.  Respondents invoke jurisprudence to support their contention
that unfair competition exists in this case. However, we are prevented from applying these
principles, along with the new provisions on Unfair Competition found in the IPR Code,
to the alleged acts of the petitioners, for such acts constitute patent  infringement as
defined by the same Code — 
SECTION 76. Civil Action for Infringement. — 76.1. 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 authorization of the patentee
constitutes patent infringement. ”
(Savage v. Taypin, G.R. No. 134217, [May 11, 2000], 387 PHIL 718-729)
 VOLUNTARY LICENSING

SEC. 85. Voluntary License Contract. – To encourage the

transfer and dissemination of technology, prevent or control
practices and conditions that may in particular cases constitute
an abuse of intellectual property rights having an adverse effect
on competition and trade, all technology transfer arrangements
(TTA) shall comply with the provisions of this Chapter.
 VOLUNTARY LICENSING

• PROHIBITED CLAUSES (those that are deemed prima facie to have an

adverse effect on competition and trade)
• Imposes upon licensee 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;
• Whereby licensor reserves the right to fix the sale or resale prices of the products
manufactured under license;
• Contains restrictions on volume and structure of production;
• Prohibits the use of competitive technologies ina non-exclusive TTA;
• Establishes a full or partial purchase option in favor of the licensor
• Obligates the licensee to transfer for free to licensor the inventions or improvement that
may be obtained through use of license technology;
• Requires payment of royalties to the owners of patent for patents which are not used;
 VOLUNTARY LICENSING
PROHIBITED CLAUSES (CON’T)
• Prohibits the licensee to export the licensed product unless justified for th protection of the legitimate interest of
the licensor such as exports to countries where exclusive licenses to manufacture and /or distribute the licensed
products have already been granted;
• Restricts use of technology supplied after the expiration of the TTA except in cases of early termination of the
TTC due to reasons attributable to licensee;
• Requires payments for patents and other industrial property rights after their expiration, termination
arrangement;
• Requires technology recipient shall not contest the validity of any of the patents of the technology supplier;
• Restricts 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;
• Prevents 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;
• Exempts the licensor for liability for non-fulfillment of his responsibilities under the TTA arrangement and/or
liability arising from third party suits brought about by the use of the licensed product or the licensed
technology and
• Other clauses with equivalent effects.
 VOLUNTARY LICENSING

MANDATORY PROVISIONS – the following shall be included in voluntary

license contracts:
88.1. laws of the Philippines governs the interpretation of the contract and in
event of litigation, venue shall be the proper court in the place where the lcensee
has its principal office;
88.2. continued access to improvement in techniques and processes related to the
technology to be made available during the period of the TTA;
88.3. where the TTA has an arbitration clause, the procedure of arbitration of the
Arbitration Law of the Philippines or the UNCITRAL arbitration rules or the ICC
Rules shall apply and the venue shall be the Philippines or any neutral country;
and
88.4 Philippine taxes on all payments relating to the TTA shall be borne by the
licensor.
 COMPULSORY LICENSING
SEC. 93. Grounds for Compulsory Licensing . – The Director of Legal Affairs may grant a
license to exploit a patented invention, even without the agreement of the patent owner, in
favor of any person who has shown his capability to exploit the invention, under any of the
following circumstances:
93.1. national emergency or other circumstances of extreme urgency;
93.2. where the public interest, in particular, national security, nutrition, health or the
development of other vital sectors of the national economy as determined by the appropriate
agency of the Government so requires; or
93.3. where a judicial or administrative body has determined that the manner of exploitation
by the owner of the patent or his licensee is anti-competitive; or
93.4. in case of public con-commercial use of the patent by the patentee, without satisfactory
reason;
93.5. 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.
93.6. 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 Health.
 SPECIAL COMPULSORY LICENSE UNDER TRIPS
• The Director General of the IPO upon written recommendation of the Secretary
of Health shall upon filing of a petition grant a special compulsory license for
the importation of patented license for the importation of patented drugs and
medicines.
• This special compulsory license for the importation shall be an additional
special alternative procedure to ensure access to quality affordable mediciens
and shall be primarily for domestic consumption.
• Provided adequate remuneration shall be paid to the patent owner either by the
exporting or importing country.
• The compulsory license shall contain a provision directing the grantee the
license to exercise reasonable measures to prevent the re-exportation of the
products imported.

(For more on compulsory licenses see Sec 93-A to 102)

 COMPULSORY LICENSING
“Neither does the Court agree with petitioner that the grant of the compulsory license to private
respondent was erroneous because the same would lead the public to think that the Cimetidine is the
invention of private respondent and not of petitioner. Such fears are unfounded since, as the
appellate court pointed out in the assailed decision, by the grant of the compulsory license, private
respondent as licensee explicitly acknowledges that petitioner is the source of the patented
product Cimetidine. Even assuming arguendo that such confusion may indeed occur, the
disadvantage is far outweighed by the benefits resulting from the grant of the compulsory license,
such as an increased supply of pharmaceutical products containing Cimetidine, and the consequent
reduction in the prices thereof. 
“There is likewise no basis for the allegation that the grant of a compulsory license to private
respondent results in the deprivation of petitioner's property without just compensation. It must be
pointed out that as owner of Letters Patent No. 12207, petitioner had already enjoyed exclusive
rights to manufacture, use and sell Cimetidine for at least two years from its grant in November,
1978. Even if other entities like private respondent are subsequently allowed to manufacture, use
and sell the patented invention by virtue of a compulsory license, petitioner as owner of the patent
would still receive remuneration for the use of such product in the form of royalties.”

(Smith Kline & French Laboratories, Ltd. v. Court of Appeals, G.R. No. 121267, [October 23,
2001], 420 PHIL 10-24)
 COMPULSORY LICENSING

“Anent the perceived inadequacy of the royalty awarded to petitioner, the Court of
Appeals correctly held that the rate of 2.5% of net wholesale price fixed by the Director
of the BPTTT is in accord with the Patent Law. In the absence of any agreement between
the parties with respect to a compulsory license, the Director of the BPTTT may fix the
terms thereof, including the rate of the royalty payable to the licensor. The law explicitly
provides that the rate of royalty shall not exceed five percent (5%) of the net wholesale
price. The Court agrees with the appellate court's ruling that the rate of royalty payments
fixed by the Director of the BPTTT is reasonable. The appellate court, citing Price
vs. United Laboratories, ruled as such, considering that the compulsory license awarded
to private respondent consists only of the bare right to use the patented invention in the
manufacture of another product, without any technical assistance from the licensor.
Furthermore, this Court had earlier noted in the Price case that identical royalty rates
have been prescribed by the Director of the BPTTT in numerous patent cases.”
(Smith Kline & French Laboratories, Ltd. v. Court of Appeals, G.R. No. 121267,
[October 23, 2001], 420 PHIL 10-24)
 ASSIGNMENT AND TRANSMISSION OF RIGHTS

SEC. 103. Transmission of Rights. – 103.1. Patents or applications for patents and
invention to which they relate, shall be protected in the same way as the rights of
other property under the Civil Code
103.2. Inventions and any right, title or interest in and to patents and inventions
covered thereby, may be assigned or transmitted by inheritance or bequest or may
be the subject of a license contract.

SEC. 104. Assignment of Inventions. – An assignment may be of entire right, title

or interest in and to the patent and the invention covered thereby, or of an
undivided share of the entire patent and invention, in which event the parties
become the joint owners thereof. An assignment may be limited to a specified
territory.