LAW ON INTELLECTUAL PROPERTY ( SET 1-A: PATENT CASES)

PEARL & DEAN (PHIL.), INCORPORATED, petitioner, vs. SHOEMART, INCORPORATED, and NORTH EDSA
MARKETING, INCORPORATED, respondents.

[G.R. No. 148222. August 15, 2003]

DECISION

CORONA, J.:

In the instant petition for review on certiorari under Rule 45 of the Rules of Court, petitioner Pearl &
Dean (Phil.) Inc. (P & D) assails the May 22, 2001 decision[1] of the Court of Appeals reversing the
October 31, 1996 decision[2] of the Regional Trial Court of Makati, Branch 133, in Civil Case No. 92-516
which declared private respondents Shoemart Inc. (SMI) and North Edsa Marketing Inc. (NEMI) liable for
infringement of trademark and copyright, and unfair competition.

FACTUAL ANTECEDENTS

The May 22, 2001 decision of the Court of Appeals[3] contained a summary of this dispute:

Plaintiff-appellant Pearl and Dean (Phil.), Inc. is a corporation engaged in the manufacture of advertising
display units simply referred to as light boxes. These units utilize specially printed posters sandwiched
between plastic sheets and illuminated with back lights. Pearl and Dean was able to secure a Certificate
of Copyright Registration dated January 20, 1981 over these illuminated display units. The advertising
light boxes were marketed under the trademark Poster Ads. The application for registration of the
trademark was filed with the Bureau of Patents, Trademarks and Technology Transfer on June 20, 1983,
but was approved only on September 12, 1988, per Registration No. 41165. From 1981 to about 1988,
Pearl and Dean employed the services of Metro Industrial Services to manufacture its advertising
displays.

Sometime in 1985, Pearl and Dean negotiated with defendant-appellant Shoemart, Inc. (SMI) for the
lease and installation of the light boxes in SM City North Edsa. Since SM City North Edsa was under
construction at that time, SMI offered as an alternative, SM Makati and SM Cubao, to which Pearl and
Dean agreed. On September 11, 1985, Pearl and Deans General Manager, Rodolfo Vergara, submitted for
signature the contracts covering SM Cubao and SM Makati to SMIs Advertising Promotions and Publicity
Division Manager, Ramonlito Abano. Only the contract for SM Makati, however, was returned signed. On
October 4, 1985, Vergara wrote Abano inquiring about the other contract and reminding him that their
agreement for installation of light boxes was not only for its SM Makati branch, but also for SM Cubao.
SMI did not bother to reply.

Instead, in a letter dated January 14, 1986, SMIs house counsel informed Pearl and Dean that it was
rescinding the contract for SM Makati due to non-performance of the terms thereof. In his reply dated
February 17, 1986, Vergara protested the unilateral action of SMI, saying it was without basis. In the
same letter, he pushed for the signing of the contract for SM Cubao.

Two years later, Metro Industrial Services, the company formerly contracted by Pearl and Dean to
fabricate its display units, offered to construct light boxes for Shoemarts chain of stores. SMI approved
the proposal and ten (10) light boxes were subsequently fabricated by Metro Industrial for SMI. After its
contract with Metro Industrial was terminated, SMI engaged the services of EYD Rainbow Advertising
Corporation to make the light boxes. Some 300 units were fabricated in 1991. These were delivered on a
staggered basis and installed at SM Megamall and SM City.

Sometime in 1989, Pearl and Dean, received reports that exact copies of its light boxes were installed at
SM City and in the fastfood section of SM Cubao. Upon investigation, Pearl and Dean found out that
aside from the two (2) reported SM branches, light boxes similar to those it manufactures were also
installed in two (2) other SM stores. It further discovered that defendant-appellant North Edsa Marketing
Inc. (NEMI), through its marketing arm, Prime Spots Marketing Services, was set up primarily to sell
advertising space in lighted display units located in SMIs different branches. Pearl and Dean noted that
NEMI is a sister company of SMI.

In the light of its discoveries, Pearl and Dean sent a letter dated December 11, 1991 to both SMI and
NEMI enjoining them to cease using the subject light boxes and to remove the same from SMIs
establishments. It also demanded the discontinued use of the trademark Poster Ads, and the payment to
Pearl and Dean of compensatory damages in the amount of Twenty Million Pesos (P20,000,000.00).

Upon receipt of the demand letter, SMI suspended the leasing of two hundred twenty-four (224) light
boxes and NEMI took down its advertisements for Poster Ads from the lighted display units in SMIs
stores. Claiming that both SMI and NEMI failed to meet all its demands, Pearl and Dean filed this instant
case for infringement of trademark and copyright, unfair competition and damages.
In denying the charges hurled against it, SMI maintained that it independently developed its poster
panels using commonly known techniques and available technology, without notice of or reference to
Pearl and Deans copyright. SMI noted that the registration of the mark Poster Ads was only for
stationeries such as letterheads, envelopes, and the like. Besides, according to SMI, the word Poster Ads
is a generic term which cannot be appropriated as a trademark, and, as such, registration of such mark is
invalid. It also stressed that Pearl and Dean is not entitled to the reliefs prayed for in its complaint since
its advertising display units contained no copyright notice, in violation of Section 27 of P.D. 49. SMI
alleged that Pearl and Dean had no cause of action against it and that the suit was purely intended to
malign SMIs good name. On this basis, SMI, aside from praying for the dismissal of the case, also
counterclaimed for moral, actual and exemplary damages and for the cancellation of Pearl and Deans
Certification of Copyright Registration No. PD-R-2558 dated January 20, 1981 and Certificate of
Trademark Registration No. 4165 dated September 12, 1988.

NEMI, for its part, denied having manufactured, installed or used any advertising display units, nor
having engaged in the business of advertising. It repleaded SMIs averments, admissions and denials and
prayed for similar reliefs and counterclaims as SMI.

The RTC of Makati City decided in favor of P & D:

Wherefore, defendants SMI and NEMI are found jointly and severally liable for infringement of copyright
under Section 2 of PD 49, as amended, and infringement of trademark under Section 22 of RA No. 166,
as amended, and are hereby penalized under Section 28 of PD 49, as amended, and Sections 23 and 24
of RA 166, as amended. Accordingly, defendants are hereby directed:

(1) to pay plaintiff the following damages:

(a) actual damages - P16,600,000.00,

representing profits

derived by defendants

as a result of infringe-

ment of plaintiffs copyright

from 1991 to 1992

(b) moral damages - P1,000.000.00

(c) exemplary damages - P1,000,000.00

(d) attorneys fees - P1,000,000.00

plus

(e) costs of suit;

(2) to deliver, under oath, for impounding in the National Library, all light boxes of SMI which were
fabricated by Metro Industrial Services and EYD Rainbow Advertising Corporation;

(3) to deliver, under oath, to the National Library, all filler-posters using the trademark Poster Ads, for
destruction; and

(4) to permanently refrain from infringing the copyright on plaintiffs light boxes and its trademark Poster
Ads.

Defendants counterclaims are hereby ordered dismissed for lack of merit.

SO ORDERED.[4]

On appeal, however, the Court of Appeals reversed the trial court:

Since the light boxes cannot, by any stretch of the imagination, be considered as either prints, pictorial
illustrations, advertising copies, labels, tags or box wraps, to be properly classified as a copyrightable
class O work, we have to agree with SMI when it posited that what was copyrighted were the technical
drawings only, and not the light boxes themselves, thus:
42. When a drawing is technical and depicts a utilitarian object, a copyright over the drawings like
plaintiff-appellants will not extend to the actual object. It has so been held under jurisprudence, of which
the leading case is Baker vs. Selden (101 U.S. 841 (1879). In that case, Selden had obtained a copyright
protection for a book entitled Seldens Condensed Ledger or Bookkeeping Simplified which purported to
explain a new system of bookkeeping. Included as part of the book were blank forms and illustrations
consisting of ruled lines and headings, specially designed for use in connection with the system explained
in the work. These forms showed the entire operation of a day or a week or a month on a single page, or
on two pages following each other. The defendant Baker then produced forms which were similar to the
forms illustrated in Seldens copyrighted books. The Court held that exclusivity to the actual forms is not
extended by a copyright. The reason was that to grant a monopoly in the underlying art when no
examination of its novelty has ever been made would be a surprise and a fraud upon the public; that is
the province of letters patent, not of copyright. And that is precisely the point. No doubt aware that its
alleged original design would never pass the rigorous examination of a patent application, plaintiff-
appellant fought to foist a fraudulent monopoly on the public by conveniently resorting to a copyright
registration which merely employs a recordal system without the benefit of an in-depth examination of
novelty.

The principle in Baker vs. Selden was likewise applied in Muller vs. Triborough Bridge Authority [43 F.
Supp. 298 (S.D.N.Y. 1942)]. In this case, Muller had obtained a copyright over an unpublished drawing
entitled Bridge Approach the drawing showed a novel bridge approach to unsnarl traffic congestion. The
defendant constructed a bridge approach which was alleged to be an infringement of the new design
illustrated in plaintiffs drawings. In this case it was held that protection of the drawing does not extend
to the unauthorized duplication of the object drawn because copyright extends only to the description or
expression of the object and not to the object itself. It does not prevent one from using the drawings to
construct the object portrayed in the drawing.

In two other cases, Imperial Homes Corp. v. Lamont, 458 F. 2d 895 and Scholtz Homes, Inc. v. Maddox,
379 F. 2d 84, it was held that there is no copyright infringement when one who, without being
authorized, uses a copyrighted architectural plan to construct a structure. This is because the copyright
does not extend to the structures themselves.

In fine, we cannot find SMI liable for infringing Pearl and Deans copyright over the technical drawings of
the latters advertising display units.

xxx xxx xxx

The Supreme Court trenchantly held in Faberge, Incorporated vs. Intermediate Appellate Court that the
protective mantle of the Trademark Law extends only to the goods used by the first user as specified in
the certificate of registration, following the clear mandate conveyed by Section 20 of Republic Act 166,
as amended, otherwise known as the Trademark Law, which reads:

SEC. 20. Certification of registration prima facie evidence of validity.- A certificate of registration of a
mark or trade-name shall be prima facie evidence of the validity of the registration, the registrants
ownership of the mark or trade-name, and of the registrants exclusive right to use the same in
connection with the goods, business or services specified in the certificate, subject to any conditions and
limitations stated therein. (underscoring supplied)

The records show that on June 20, 1983, Pearl and Dean applied for the registration of the trademark
Poster Ads with the Bureau of Patents, Trademarks, and Technology Transfer. Said trademark was
recorded in the Principal Register on September 12, 1988 under Registration No. 41165 covering the
following products: stationeries such as letterheads, envelopes and calling cards and newsletters.

With this as factual backdrop, we see no legal basis to the finding of liability on the part of the
defendants-appellants for their use of the words Poster Ads, in the advertising display units in suit.
Jurisprudence has interpreted Section 20 of the Trademark Law as an implicit permission to a
manufacturer to venture into the production of goods and allow that producer to appropriate the brand
name of the senior registrant on goods other than those stated in the certificate of registration. The
Supreme Court further emphasized the restrictive meaning of Section 20 when it stated, through Justice
Conrado V. Sanchez, that:

Really, if the certificate of registration were to be deemed as including goods not specified therein, then
a situation may arise whereby an applicant may be tempted to register a trademark on any and all goods
which his mind may conceive even if he had never intended to use the trademark for the said goods. We
believe that such omnibus registration is not contemplated by our Trademark Law.

While we do not discount the striking similarity between Pearl and Deans registered trademark and
defendants-appellants Poster Ads design, as well as the parallel use by which said words were used in
the parties respective advertising copies, we cannot find defendants-appellants liable for infringement of
trademark. Poster Ads was registered by Pearl and Dean for specific use in its stationeries, in contrast to
defendants-appellants who used the same words in their advertising display units. Why Pearl and Dean
limited the use of its trademark to stationeries is simply beyond us. But, having already done so, it must
stand by the consequence of the registration which it had caused.

xxx xxx xxx

We are constrained to adopt the view of defendants-appellants that the words Poster Ads are a simple
contraction of the generic term poster advertising. In the absence of any convincing proof that Poster
Ads has acquired a secondary meaning in this jurisdiction, we find that Pearl and Deans exclusive right to
the use of Poster Ads is limited to what is written in its certificate of registration, namely, stationeries.

Defendants-appellants cannot thus be held liable for infringement of the trademark Poster Ads.

There being no finding of either copyright or trademark infringement on the part of SMI and NEMI, the
monetary award granted by the lower court to Pearl and Dean has no leg to stand on.

xxx xxx xxx

WHEREFORE, premises considered, the assailed decision is REVERSED and SET ASIDE, and another is
rendered DISMISSING the complaint and counterclaims in the above-entitled case for lack of merit.[5]

Dissatisfied with the above decision, petitioner P & D filed the instant petition assigning the following
errors for the Courts consideration:

A. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT NO COPYRIGHT INFRINGEMENT WAS
COMMITTED BY RESPONDENTS SM AND NEMI;

B. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT NO INFRINGEMENT OF PEARL & DEANS
TRADEMARK POSTER ADS WAS COMMITTED BY RESPONDENTS SM AND NEMI;
C. THE HONORABLE COURT OF APPEALS ERRED IN DISMISSING THE AWARD OF THE TRIAL COURT,
DESPITE THE LATTERS FINDING, NOT DISPUTED BY THE HONORABLE COURT OF APPEALS, THAT SM WAS
GUILTY OF BAD FAITH IN ITS NEGOTIATION OF ADVERTISING CONTRACTS WITH PEARL & DEAN.

D. THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING RESPONDENTS SM AND NEMI LIABLE
TO PEARL & DEAN FOR ACTUAL, MORAL & EXEMPLARY DAMAGES, ATTORNEYS FEES AND COSTS OF SUIT.
[6]

ISSUES

In resolving this very interesting case, we are challenged once again to put into proper perspective four
main concerns of intellectual property law patents, copyrights, trademarks and unfair competition
arising from infringement of any of the first three. We shall focus then on the following issues:

(1) if the engineering or technical drawings of an advertising display unit (light box) are granted copyright
protection (copyright certificate of registration) by the National Library, is the light box depicted in such
engineering drawings ipso facto also protected by such copyright?

(2) or should the light box be registered separately and protected by a patent issued by the Bureau of
Patents Trademarks and Technology Transfer (now Intellectual Property Office) in addition to the
copyright of the engineering drawings?

(3) can the owner of a registered trademark legally prevent others from using such trademark if it is a
mere abbreviation of a term descriptive of his goods, services or business?

ON THE ISSUE OF COPYRIGHT INFRINGEMENT

Petitioner P & Ds complaint was that SMI infringed on its copyright over the light boxes when SMI had
the units manufactured by Metro and EYD Rainbow Advertising for its own account. Obviously,
petitioners position was premised on its belief that its copyright over the engineering drawings extended
ipso facto to the light boxes depicted or illustrated in said drawings. In ruling that there was no copyright
infringement, the Court of Appeals held that the copyright was limited to the drawings alone and not to
the light box itself. We agree with the appellate court.
First, petitioners application for a copyright certificate as well as Copyright Certificate No. PD-R2588
issued by the National Library on January 20, 1981 clearly stated that it was for a class O work under
Section 2 (O) of PD 49 (The Intellectual Property Decree) which was the statute then prevailing. Said
Section 2 expressly enumerated the works subject to copyright:

SEC. 2. The rights granted by this Decree shall, from the moment of creation, subsist with respect to any
of the following works:

xxxxxxxxx

(O) Prints, pictorial illustrations, advertising copies, labels, tags, and box wraps;

xxxxxxxxx

Although petitioners copyright certificate was entitled Advertising Display Units (which depicted the box-
type electrical devices), its claim of copyright infringement cannot be sustained.

Copyright, in the strict sense of the term, is purely a statutory right. Being a mere statutory grant, the
rights are limited to what the statute confers. It may be obtained and enjoyed only with respect to the
subjects and by the persons, and on terms and conditions specified in the statute.[7] Accordingly, it can
cover only the works falling within the statutory enumeration or description.[8]

P & D secured its copyright under the classification class O work. This being so, petitioners copyright
protection extended only to the technical drawings and not to the light box itself because the latter was
not at all in the category of prints, pictorial illustrations, advertising copies, labels, tags and box wraps.
Stated otherwise, even as we find that P & D indeed owned a valid copyright, the same could have
referred only to the technical drawings within the category of pictorial illustrations. It could not have
possibly stretched out to include the underlying light box. The strict application[9] of the laws
enumeration in Section 2 prevents us from giving petitioner even a little leeway, that is, even if its
copyright certificate was entitled Advertising Display Units. What the law does not include, it excludes,
and for the good reason: the light box was not a literary or artistic piece which could be copyrighted
under the copyright law. And no less clearly, neither could the lack of statutory authority to make the
light box copyrightable be remedied by the simplistic act of entitling the copyright certificate issued by
the National Library as Advertising Display Units.

In fine, if SMI and NEMI reprinted P & Ds technical drawings for sale to the public without license from P
& D, then no doubt they would have been guilty of copyright infringement. But this was not the case.
SMIs and NEMIs acts complained of by P & D were to have units similar or identical to the light box
illustrated in the technical drawings manufactured by Metro and EYD Rainbow Advertising, for leasing
out to different advertisers. Was this an infringement of petitioners copyright over the technical
drawings? We do not think so.

During the trial, the president of P & D himself admitted that the light box was neither a literary not an
artistic work but an engineering or marketing invention.[10] Obviously, there appeared to be some
confusion regarding what ought or ought not to be the proper subjects of copyrights, patents and
trademarks. In the leading case of Kho vs. Court of Appeals,[11] we ruled that these three legal 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:

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.

ON THE ISSUE OF PATENT INFRINGEMENT

This brings us to the next point: if, despite its manufacture and commercial use of the light boxes without
license from petitioner, private respondents cannot be held legally liable for infringement of P & Ds
copyright over its technical drawings of the said light boxes, should they be liable instead for
infringement of patent? We do not think so either.

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,[12] 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. x x x (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.[13] On the assumption that petitioners 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.[14] Ideas, once disclosed
to the public without the protection of a valid patent, are subject to appropriation without significant
restraint.[15]

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. As held in Bauer & Cie vs. ODonnel,[16] The act secured to the inventor the
exclusive right to make use, and vend the thing patented, and consequently to prevent others from
exercising like privileges without the consent of the patentee. It was passed for the purpose of
encouraging useful invention and promoting new and useful inventions by the protection and
stimulation given to inventive genius, and was intended to secure to the public, after the lapse of the
exclusive privileges granted the benefit of such inventions and improvements.

The law attempts to strike an ideal balance between the two interests:

(The p)atent system thus embodies a carefully crafted bargain for encouraging the creation and
disclosure of new useful and non-obvious advances in technology and design, in return for the exclusive
right to practice the invention for a number of years. The inventor may keep his invention secret and
reap its fruits indefinitely. In consideration of its disclosure and the consequent benefit to the
community, the patent is granted. An exclusive enjoyment is guaranteed him for 17 years, but upon the
expiration of that period, the knowledge of the invention inures to the people, who are thus enabled to
practice it and profit by its use.[17]

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.[18]

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.[19]

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[20] 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.

Stated otherwise, what petitioner seeks is exclusivity without any opportunity for the patent office (IPO)
to scrutinize the light boxs eligibility as a patentable invention. The irony here is that, had petitioner
secured a patent instead, its exclusivity would have been for 17 years only. But through the simplified
procedure of copyright-registration with the National Library without undergoing the rigor of defending
the patentability of its invention before the IPO and the public the petitioner would be protected for 50
years. This situation could not have been the intention of the law.

In the oft-cited case of Baker vs. Selden[21], the United States Supreme Court held that only the
expression of an idea is protected by copyright, not the idea itself. In that case, the plaintiff held the
copyright of a book which expounded on a new accounting system he had developed. The publication
illustrated blank forms of ledgers utilized in such a system. The defendant reproduced forms similar to
those illustrated in the plaintiffs copyrighted book. The US Supreme Court ruled that:

There is no doubt that a work on the subject of book-keeping, though only explanatory of well known
systems, may be the subject of a copyright; but, then, it is claimed only as a book. x x x. But there is a
clear distinction between the books, as such, and the art, which it is, intended to illustrate. The mere
statement of the proposition is so evident that it requires hardly any argument to support it. The same
distinction may be predicated of every other art as well as that of bookkeeping. A treatise on the
composition and use of medicines, be they old or new; on the construction and use of ploughs or
watches or churns; or on the mixture and application of colors for painting or dyeing; or on the mode of
drawing lines to produce the effect of perspective, would be the subject of copyright; but no one would
contend that the copyright of the treatise would give the exclusive right to the art or manufacture
described therein. The copyright of the book, if not pirated from other works, would be valid without
regard to the novelty or want of novelty of its subject matter. The novelty of the art or thing described or
explained has nothing to do with the validity of the copyright. To give to the author of the book an
exclusive property in the art described therein, when no examination of its novelty has ever been
officially made, would be a surprise and a fraud upon the public. That is the province of letters patent,
not of copyright. The claim to an invention of discovery of an art or manufacture must be subjected to
the examination of the Patent Office before an exclusive right therein can be obtained; and a patent from
the government can only secure it.

The difference between the two things, letters patent and copyright, may be illustrated by reference to
the subjects just enumerated. Take the case of medicines. Certain mixtures are found to be of great
value in the healing art. If the discoverer writes and publishes a book on the subject (as regular
physicians generally do), he gains no exclusive right to the manufacture and sale of the medicine; he
gives that to the public. If he desires to acquire such exclusive right, he must obtain a patent for the
mixture as a new art, manufacture or composition of matter. He may copyright his book, if he pleases;
but that only secures to him the exclusive right of printing and publishing his book. So of all other
inventions or discoveries.

The copyright of a book on perspective, no matter how many drawings and illustrations it may contain,
gives no exclusive right to the modes of drawing described, though they may never have been known or
used before. By publishing the book without getting a patent for the art, the latter is given to the public.

xxx

Now, whilst no one has a right to print or publish his book, or any material part thereof, as a book
intended to convey instruction in the art, any person may practice and use the art itself which he has
described and illustrated therein. The use of the art is a totally different thing from a publication of the
book explaining it. The copyright of a book on bookkeeping cannot secure the exclusive right to make,
sell and use account books prepared upon the plan set forth in such book. Whether the art might or
might not have been patented, is a question, which is not before us. It was not patented, and is open and
free to the use of the public. And, of course, in using the art, the ruled lines and headings of accounts
must necessarily be used as incident to it.

The plausibility of the claim put forward by the complainant in this case arises from a confusion of ideas
produced by the peculiar nature of the art described in the books, which have been made the subject of
copyright. In describing the art, the illustrations and diagrams employed happened to correspond more
closely than usual with the actual work performed by the operator who uses the art. x x x The
description of the art in a book, though entitled to the benefit of copyright, lays no foundation for an
exclusive claim to the art itself. The object of the one is explanation; the object of the other is use. The
former may be secured by copyright. The latter can only be secured, if it can be secured at all, by letters
patent. (underscoring supplied)

ON THE ISSUE OF TRADEMARK INFRINGEMENT

This issue concerns the use by respondents of the mark Poster Ads which petitioners president said was
a contraction of poster advertising. P & D was able to secure a trademark certificate for it, but one where
the goods specified were stationeries such as letterheads, envelopes, calling cards and newsletters.[22]
Petitioner admitted it did not commercially engage in or market these goods. On the contrary, it dealt in
electrically operated backlit advertising units and the sale of advertising spaces thereon, which, however,
were not at all specified in the trademark certificate.

Under the circumstances, the Court of Appeals correctly cited Faberge Inc. vs. Intermediate Appellate
Court,[23] where we, invoking Section 20 of the old Trademark Law, ruled that the certificate of
registration issued by the Director of Patents can confer (upon petitioner) the exclusive right to use its
own symbol only to those goods specified in the certificate, subject to any conditions and limitations
specified in the certificate x x x. One who has adopted and used a trademark on his goods does not
prevent the adoption and use of the same trademark by others for products which are of a different
description.[24] Faberge, Inc. was correct and was in fact recently reiterated in Canon Kabushiki Kaisha
vs. Court of Appeals.[25]

Assuming arguendo that Poster Ads could validly qualify as a trademark, the failure of P & D to secure a
trademark registration for specific use on the light boxes meant that there could not have been any
trademark infringement since registration was an essential element thereof.

ON THE ISSUE OF UNFAIR COMPETITION

If at all, the cause of action should have been for unfair competition, a situation which was possible even
if P & D had no registration.[26] However, while the petitioners complaint in the RTC also cited unfair
competition, the trial court did not find private respondents liable therefor. Petitioner did not appeal this
particular point; hence, it cannot now revive its claim of unfair competition.

But even disregarding procedural issues, we nevertheless cannot hold respondents guilty of unfair
competition.

By the nature of things, there can be no unfair competition under the law on copyrights although it is
applicable to disputes over the use of trademarks. Even a name or phrase incapable of appropriation as a
trademark or tradename may, by long and exclusive use by a business (such that the name or phrase
becomes associated with the business or product in the mind of the purchasing public), be entitled to
protection against unfair competition.[27] In this case, there was no evidence that P & Ds use of Poster
Ads was distinctive or well-known. As noted by the Court of Appeals, petitioners expert witnesses
himself had testified that Poster Ads was too generic a name. So it was difficult to identify it with any
company, honestly speaking.[28] This crucial admission by its own expert witness that Poster Ads could
not be associated with P & D showed that, in the mind of the public, the goods and services carrying the
trademark Poster Ads could not be distinguished from the goods and services of other entities.

This fact also prevented the application of the doctrine of secondary meaning. Poster Ads was generic
and incapable of being used as a trademark because it was used in the field of poster advertising, the
very business engaged in by petitioner. Secondary meaning means that a word or phrase originally
incapable of exclusive appropriation with reference to an article in the market (because it is
geographically or otherwise descriptive) might nevertheless have been used for so long and so
exclusively by one producer with reference to his article that, in the trade and to that branch of the
purchasing public, the word or phrase has come to mean that the article was his property.[29] The
admission by petitioners own expert witness that he himself could not associate Poster Ads with
petitioner P & D because it was too generic definitely precluded the application of this exception.

Having discussed the most important and critical issues, we see no need to belabor the rest.

All told, the Court finds no reversible error committed by the Court of Appeals when it reversed the
Regional Trial Court of Makati City.

WHEREFORE, the petition is hereby DENIED and the decision of the Court of Appeals dated May 22, 2001
is AFFIRMED in toto.

SO ORDERED.

***************************************

G.R. No. 161295. June 29, 2005]

JESSIE G. CHING, petitioner, vs. WILLIAM M. SALINAS, SR., WILLIAM M. SALINAS, JR., JOSEPHINE L.
SALINAS, JENNIFER Y. SALINAS, ALONTO SOLAIMAN SALLE, JOHN ERIC I. SALINAS, NOEL M. YABUT (Board
of Directors and Officers of WILAWARE PRODUCT CORPORATION), respondents.

DECISION

CALLEJO, SR., J.:

This petition for review on certiorari assails the Decision[1] and Resolution[2] of the Court of Appeals
(CA) in CA-G.R. SP No. 70411 affirming the January 3, 2002 and February 14, 2002 Orders[3] of the
Regional Trial Court (RTC) of Manila, Branch 1, which quashed and set aside Search Warrant Nos. 01-
2401 and 01-2402 granted in favor of petitioner Jessie G. Ching.

Jessie G. Ching is the owner and general manager of Jeshicris Manufacturing Co., the maker and
manufacturer of a Utility Model, described as Leaf Spring Eye Bushing for Automobile made up of plastic.

On September 4, 2001, Ching and Joseph Yu were issued by the National Library Certificates of Copyright
Registration and Deposit of the said work described therein as Leaf Spring Eye Bushing for Automobile.
[4]

On September 20, 2001, Ching requested the National Bureau of Investigation (NBI) for
police/investigative assistance for the apprehension and prosecution of illegal manufacturers, producers
and/or distributors of the works.[5]
After due investigation, the NBI filed applications for search warrants in the RTC of Manila against
William Salinas, Sr. and the officers and members of the Board of Directors of Wilaware Product
Corporation. It was alleged that the respondents therein reproduced and distributed the said models
penalized under Sections 177.1 and 177.3 of Republic Act (R.A.) No. 8293. The applications sought the
seizure of the following:

a.) Undetermined quantity of Leaf spring eye bushing for automobile that are made up of plastic
polypropylene;

b.) Undetermined quantity of Leaf spring eye bushing for automobile that are made up of polyvinyl
chloride plastic;

c.) Undetermined quantity of Vehicle bearing cushion that is made up of polyvinyl chloride plastic;

d.) Undetermined quantity of Dies and jigs, patterns and flasks used in the manufacture/fabrication of
items a to d;

e.) Evidences of sale which include delivery receipts, invoices and official receipts.[6]

The RTC granted the application and issued Search Warrant Nos. 01-2401 and 01-2402 for the seizure of
the aforecited articles.[7] In the inventory submitted by the NBI agent, it appears that the following
articles/items were seized based on the search warrants:

Leaf Spring eye bushing

a) Plastic Polypropylene

- C190 27 }

- C240 rear 40 }

- C240 front 41 } BAG 1

b) Polyvinyl Chloride Plastic

- C190 13 }

c) Vehicle bearing cushion

- center bearing cushion 11 }

Budder for C190 mold 8 }

Diesel Mold

a) Mold for spring eye bushing rear 1 set

b) Mold for spring eye bushing front 1 set

c) Mold for spring eye bushing for C190 1 set

d) Mold for C240 rear 1 piece of the

set

e) Mold for spring eye bushing for L300 2 sets

f) Mold for leaf spring eye bushing C190

with metal 1 set

g) Mold for vehicle bearing cushion 1 set[8]

The respondents filed a motion to quash the search warrants on the following grounds:

2. The copyright registrations were issued in violation of the Intellectual Property Code on the ground
that:

a) the subject matter of the registrations are not artistic or literary;

b) the subject matter of the registrations are spare parts of automobiles meaning there (sic) are original
parts that they are designed to replace. Hence, they are not original.[9]

The respondents averred that the works covered by the certificates issued by the National Library are
not artistic in nature; they are considered automotive spare parts and pertain to technology. They aver
that the models are not original, and as such are the proper subject of a patent, not copyright.[10]

In opposing the motion, the petitioner averred that the court which issued the search warrants was not
the proper forum in which to articulate the issue of the validity of the copyrights issued to him. Citing
the ruling of the Court in Malaloan v. Court of Appeals,[11] the petitioner stated that a search warrant is
merely a judicial process designed by the Rules of Court in anticipation of a criminal case. Until his
copyright was nullified in a proper proceeding, he enjoys rights of a registered owner/holder thereof.

On January 3, 2002, the trial court issued an Order[12] granting the motion, and quashed the search
warrant on its finding that there was no probable cause for its issuance. The court ruled that the work
covered by the certificates issued to the petitioner pertained to solutions to technical problems, not
literary and artistic as provided in Article 172 of the Intellectual Property Code.
His motion for reconsideration of the order having been denied by the trial courts Order of February 14,
2002, the petitioner filed a petition for certiorari in the CA, contending that the RTC had no jurisdiction
to delve into and resolve the validity of the copyright certificates issued to him by the National Library.
He insisted that his works are covered by Sections 172.1 and 172.2 of the Intellectual Property Code. The
petitioner averred that the copyright certificates are prima facie evidence of its validity, citing the ruling
of the United States Court of Appeals in Wildlife Express Corporation v. Carol Wright Sales, Inc.[13] The
petitioner asserted that the respondents failed to adduce evidence to support their motion to quash the
search warrants. The petitioner noted that respondent William Salinas, Jr. was not being honest, as he
was able to secure a similar copyright registration of a similar product from the National Library on
January 14, 2002.

On September 26, 2003, the CA rendered judgment dismissing the petition on its finding that the RTC did
not commit any grave abuse of its discretion in issuing the assailed order, to wit:

It is settled that preliminarily, there must be a finding that a specific offense must have been committed
to justify the issuance of a search warrant. In a number of cases decided by the Supreme Court, the
same is explicitly provided, thus:

The probable cause must be in connection with one specific offense, and the judge must, before issuing
the warrant, personally examine in the form of searching questions and answers, in writing and under
oath, the complainant and any witness he may produce, on facts personally known to them and attach
to the record their sworn statements together with any affidavit submitted.

In the determination of probable cause, the court must necessarily resolve whether or not an offense
exists to justify the issuance or quashal of the search warrant.

In the instant case, the petitioner is praying for the reinstatement of the search warrants issued, but
subsequently quashed, for the offense of Violation of Class Designation of Copyrightable Works under
Section 177.1 in relation to Section 177.3 of Republic Act 8293, when the objects subject of the same,
are patently not copyrightable.

It is worthy to state that the works protected under the Law on Copyright are: literary or artistic works
(Sec. 172) and derivative works (Sec. 173). The Leaf Spring Eye Bushing and Vehicle Bearing Cushion fall
on neither classification. Accordingly, if, in the first place, the item subject of the petition is not entitled
to be protected by the law on copyright, how can there be any violation?[14]
The petitioners motion for reconsideration of the said decision suffered the same fate. The petitioner
forthwith filed the present petition for review on certiorari, contending that the revocation of his
copyright certificates should be raised in a direct action and not in a search warrant proceeding.

The petitioner posits that even assuming ex argumenti that the trial court may resolve the validity of his
copyright in a proceeding to quash a search warrant for allegedly infringing items, the RTC committed a
grave abuse of its discretion when it declared that his works are not copyrightable in the first place. He
claims that R.A. No. 8293, otherwise known as the Intellectual Property Code of the Philippines, which
took effect on January 1, 1998, provides in no uncertain terms that copyright protection automatically
attaches to a work by the sole fact of its creation, irrespective of its mode or form of expression, as well
as of its content, quality or purpose.[15] The law gives a non-inclusive definition of work as referring to
original intellectual creations in the literary and artistic domain protected from the moment of their
creation; and includes original ornamental designs or models for articles of manufacture, whether or not
registrable as an industrial design and other works of applied art under Section 172.1(h) of R.A. No.
8293.

As such, the petitioner insists, notwithstanding the classification of the works as either literary and/or
artistic, the said law, likewise, encompasses works which may have a bearing on the utility aspect to
which the petitioners utility designs were classified. Moreover, according to the petitioner, what the
Copyright Law protects is the authors intellectual creation, regardless of whether it is one with utilitarian
functions or incorporated in a useful article produced on an industrial scale.

The petitioner also maintains that the law does not provide that the intended use or use in industry of
an article eligible for patent bars or invalidates its registration under the Law on Copyright. The test of
protection for the aesthetic is not beauty and utility, but art for the copyright and invention of original
and ornamental design for design patents.[16] In like manner, the fact that his utility designs or models
for articles of manufacture have been expressed in the field of automotive parts, or based on something
already in the public domain does not automatically remove them from the protection of the Law on
Copyright.[17]

The petitioner faults the CA for ignoring Section 218 of R.A. No. 8293 which gives the same presumption
to an affidavit executed by an author who claims copyright ownership of his work.

The petitioner adds that a finding of probable cause to justify the issuance of a search warrant means
merely a reasonable suspicion of the commission of the offense. It is not equivalent to absolute certainty
or a finding of actual and positive cause.[18] He assists that the determination of probable cause does
not concern the issue of whether or not the alleged work is copyrightable. He maintains that to justify a
finding of probable cause in the issuance of a search warrant, it is enough that there exists a reasonable
suspicion of the commission of the offense.

The petitioner contends that he has in his favor the benefit of the presumption that his copyright is valid;
hence, the burden of overturning this presumption is on the alleged infringers, the respondents herein.
But this burden cannot be carried in a hearing on a proceeding to quash the search warrants, as the
issue therein is whether there was probable cause for the issuance of the search warrant. The petitioner
concludes that the issue of probable cause should be resolved without invalidating his copyright.

In their comment on the petition, the respondents aver that the work of the petitioner is essentially a
technical solution to the problem of wear and tear in automobiles, the substitution of materials, i.e.,
from rubber to plastic matter of polyvinyl chloride, an oil resistant soft texture plastic material strong
enough to endure pressure brought about by the vibration of the counter bearing and thus brings
bushings. Such work, the respondents assert, is the subject of copyright under Section 172.1 of R.A. No.
8293. The respondents posit that a technical solution in any field of human activity which is novel may
be the subject of a patent, and not of a copyright. They insist that the certificates issued by the National
Library are only certifications that, at a point in time, a certain work was deposited in the said office.
Furthermore, the registration of copyrights does not provide for automatic protection. Citing Section
218.2(b) of R.A. No. 8293, the respondents aver that no copyright is said to exist if a party categorically
questions its existence and legality. Moreover, under Section 2, Rule 7 of the Implementing Rules of R.A.
No. 8293, the registration and deposit of work is not conclusive as to copyright outlay or the time of
copyright or the right of the copyright owner. The respondents maintain that a copyright exists only
when the work is covered by the protection of R.A. No. 8293.

The petition has no merit.

The RTC had jurisdiction to delve into and resolve the issue whether the petitioners utility models are
copyrightable and, if so, whether he is the owner of a copyright over the said models. It bears stressing
that upon the filing of the application for search warrant, the RTC was duty-bound to determine whether
probable cause existed, in accordance with Section 4, Rule 126 of the Rules of Criminal Procedure:

SEC. 4. Requisite for issuing search warrant. A search warrant shall not issue but upon probable cause in
connection with one specific offense to be determined personally by the judge after examination under
oath or affirmation of the complainant and the witnesses he may produce, and, particularly, describing
the place to be searched and the things to be seized.

In Solid Triangle Sales Corporation v. The Sheriff of RTC QC, Br. 93,[19] the Court held that in the
determination of probable cause, the court must necessarily resolve whether or not an offense exists to
justify the issuance of a search warrant or the quashal of one already issued by the court. Indeed,
probable cause is deemed to exist only where facts and circumstances exist which could lead a
reasonably cautious and prudent man to believe that an offense has been committed or is being
committed. Besides, in Section 3, Rule 126 of the Rules of Criminal Procedure, a search warrant may be
issued for the search and seizure of personal property (a) subject of the offense; (b) stolen or embezzled
and other proceeds or fruits of the offense; or (c) used or intended to be used as the means of
committing an offense.

The RTC is mandated under the Constitution and Rules of Criminal Procedure to determine probable
cause. The court cannot abdicate its constitutional obligation by refusing to determine whether an
offense has been committed.[20] The absence of probable cause will cause the outright nullification of
the search warrant.[21]

For the RTC to determine whether the crime for infringement under R.A. No. 8293 as alleged in an
application is committed, the petitioner-applicant was burdened to prove that (a) respondents Jessie
Ching and Joseph Yu were the owners of copyrighted material; and (b) the copyrighted material was
being copied and distributed by the respondents. Thus, the ownership of a valid copyright is essential.
[22]

Ownership of copyrighted material is shown by proof of originality and copyrightability. By originality is

meant that the material was not copied, and evidences at least minimal creativity; that it was
independently created by the author and that it possesses at least same minimal degree of creativity.
[23] Copying is shown by proof of access to copyrighted material and substantial similarity between the
two works.[24] The applicant must thus demonstrate the existence and the validity of his copyright
because in the absence of copyright protection, even original creation may be freely copied.[25]

By requesting the NBI to investigate and, if feasible, file an application for a search warrant for
infringement under R.A. No. 8293 against the respondents, the petitioner thereby authorized the RTC (in
resolving the application), to delve into and determine the validity of the copyright which he claimed he
had over the utility models. The petitioner cannot seek relief from the RTC based on his claim that he
was the copyright owner over the utility models and, at the same time, repudiate the courts jurisdiction
to ascertain the validity of his claim without running afoul to the doctrine of estoppel.

To discharge his burden, the applicant may present the certificate of registration covering the work or, in
its absence, other evidence.[26] A copyright certificate provides prima facie evidence of originality which
is one element of copyright validity. It constitutes prima facie evidence of both validity and
ownership[27] and the validity of the facts stated in the certificate.[28] The presumption of validity to a
certificate of copyright registration merely orders the burden of proof. The applicant should not
ordinarily be forced, in the first instance, to prove all the multiple facts that underline the validity of the
copyright unless the respondent, effectively challenging them, shifts the burden of doing so to the
applicant.[29] Indeed, Section 218.2 of R.A. No. 8293 provides:

218.2. In an action under this Chapter:

(a) Copyright shall be presumed to subsist in the work or other subject matter to which the action relates
if the defendant does not put in issue the question whether copyright subsists in the work or other
subject matter; and

(b) Where the subsistence of the copyright is established, the plaintiff shall be presumed to be the
owner of the copyright if he claims to be the owner of the copyright and the defendant does not put in
issue the question of his ownership.
A certificate of registration creates no rebuttable presumption of copyright validity where other evidence
in the record casts doubt on the question. In such a case, validity will not be presumed.[30]

To discharge his burden of probable cause for the issuance of a search warrant for violation of R.A. No.
8293, the petitioner-applicant submitted to the RTC Certificate of Copyright Registration Nos. 2001-197
and 2001-204 dated September 3, 2001 and September 4, 2001, respectively, issued by the National
Library covering work identified as Leaf Spring Eye Bushing for Automobile and Vehicle Bearing Cushion
both classified under Section 172.1(h) of R.A. No. 8293, to wit:

SEC. 172. Literary and Artistic Works. 172.1. Literary and artistic works, hereinafter referred to as works,
are original intellectual creations in the literary and artistic domain protected from the moment of their
creation and shall include in particular:

...

(h) Original ornamental designs or models for articles of manufacture, whether or not registrable as an
industrial design, and other works of applied art.

Related to the provision is Section 171.10, which provides that a work of applied art is an artistic creation
with utilitarian functions or incorporated in a useful article, whether made by hand or produced on an
industrial scale.

But, as gleaned from the specifications appended to the application for a copyright certificate filed by
the petitioner, the said Leaf Spring Eye Bushing for Automobile is merely a utility model described as
comprising a generally cylindrical body having a co-axial bore that is centrally located and provided with
a perpendicular flange on one of its ends and a cylindrical metal jacket surrounding the peripheral walls
of said body, with the bushing made of plastic that is either polyvinyl chloride or polypropylene.[31]
Likewise, the Vehicle Bearing Cushion is illustrated as a bearing cushion comprising a generally semi-
circular body having a central hole to secure a conventional bearing and a plurality of ridges provided
therefore, with said cushion bearing being made of the same plastic materials.[32] Plainly, these are not
literary or artistic works. They are not intellectual creations in the literary and artistic domain, or works
of applied art. They are certainly not ornamental designs or one having decorative quality or value.

It bears stressing that the focus of copyright is the usefulness of the artistic design, and not its
marketability. The central inquiry is whether the article is a work of art.[33] Works for applied art include
all original pictorials, graphics, and sculptural works that are intended to be or have been embodied in
useful article regardless of factors such as mass production, commercial exploitation, and the potential
availability of design patent protection.[34]

As gleaned from the description of the models and their objectives, these articles are useful articles
which are defined as one having an intrinsic utilitarian function that is not merely to portray the
appearance of the article or to convey information. Indeed, while works of applied art, original
intellectual, literary and artistic works are copyrightable, useful articles and works of industrial design are
not.[35] A useful article may be copyrightable 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.

We agree with the contention of the petitioner (citing Section 171.10 of R.A. No. 8293), that the authors
intellectual creation, regardless of whether it is a creation with utilitarian functions or incorporated in a
useful article produced on an industrial scale, is protected by copyright law. However, the law refers to a
work of applied art which is an artistic creation. It bears stressing that there is no copyright protection
for works of applied art or industrial design which have aesthetic or artistic features that cannot be
identified separately from the utilitarian aspects of the article.[36] Functional components of useful
articles, no matter how artistically designed, have generally been denied copyright protection unless
they are separable from the useful article.[37]

In this case, the petitioners models are not works of applied art, nor artistic works. They are utility
models, useful articles, albeit with no artistic design or value. Thus, the petitioner described the utility
model as follows:

LEAF SPRING EYE BUSHING FOR AUTOMOBILE

Known bushings inserted to leaf-spring eye to hold leaf-springs of automobile are made of hard rubber.
These rubber bushings after a time, upon subjecting them to so much or intermittent pressure would
eventually wore (sic) out that would cause the wobbling of the leaf spring.

The primary object of this utility model, therefore, is to provide a leaf-spring eye bushing for automobile
that is made up of plastic.

Another object of this utility model is to provide a leaf-spring eye bushing for automobiles made of
polyvinyl chloride, an oil resistant soft texture plastic or polypropylene, a hard plastic, yet both causes
cushion to the leaf spring, yet strong enough to endure pressure brought about by the up and down
movement of said leaf spring.
Yet, an object of this utility model is to provide a leaf-spring eye bushing for automobiles that has a much
longer life span than the rubber bushings.

Still an object of this utility model is to provide a leaf-spring eye bushing for automobiles that has a very
simple construction and can be made using simple and ordinary molding equipment.

A further object of this utility model is to provide a leaf-spring eye bushing for automobile that is
supplied with a metal jacket to reinforce the plastic eye bushing when in engaged with the steel material
of the leaf spring.

These and other objects and advantages will come to view and be understood upon a reading of the
detailed description when taken in conjunction with the accompanying drawings.

Figure 1 is an exploded perspective of a leaf-spring eye bushing according to the present utility model;

Figure 2 is a sectional view taken along line 2-2 of Fig. 1;

Figure 3 is a longitudinal sectional view of another embodiment of this utility model;

Figure 4 is a perspective view of a third embodiment; and

Figure 5 is a sectional view thereof.

Referring now to the several views of the drawings wherein like reference numerals designated same
parts throughout, there is shown a utility model for a leaf-spring eye bushing for automobile generally
designated as reference numeral 10.

Said leaf-spring eye bushing 10 comprises a generally cylindrical body 11 having a co-axial bore 12
centrally provided thereof.
As shown in Figs. 1 and 2, said leaf-spring eye bushing 10 is provided with a perpendicular flange 13 on
one of its ends and a cylindrical metal jacket 14 surrounding the peripheral walls 15 of said body 11.
When said leaf-spring bushing 10 is installed, the metal jacket 14 acts with the leaf-spring eye (not
shown), which is also made of steel or cast steel. In effect, the bushing 10 will not be directly in contact
with steel, but rather the metal jacket, making the life of the bushing 10 longer than those without the
metal jacket.

In Figure 2, the bushing 10 as shown is made of plastic, preferably polyvinyl chloride, an oil resistant soft
texture plastic or a hard polypropylene plastic, both are capable to endure the pressure applied thereto,
and, in effect, would lengthen the life and replacement therefor.

Figure 3, on the other hand, shows the walls 16 of the co-axial bore 12 of said bushing 10 is insertably
provided with a steel tube 17 to reinforce the inner portion thereof. This steel tube 17 accommodates or
engages with the leaf-spring bolt (not shown) connecting the leaf spring and the automobiles chassis.

Figures 4 and 5 show another embodiment wherein the leaf eye bushing 10 is elongated and cylindrical
as to its construction. Said another embodiment is also made of polypropylene or polyvinyl chloride
plastic material. The steel tube 17 and metal jacket 14 may also be applied to this embodiment as an
option thereof.[38]

VEHICLE BEARING CUSHION

Known bearing cushions inserted to bearing housings for vehicle propeller shafts are made of hard
rubber. These rubber bushings after a time, upon subjecting them to so much or intermittent pressure
would eventually be worn out that would cause the wobbling of the center bearing.

The primary object of this utility model therefore is to provide a vehicle-bearing cushion that is made up
of plastic.
Another object of this utility model is to provide a vehicle bearing cushion made of polyvinyl chloride, an
oil resistant soft texture plastic material which causes cushion to the propellers center bearing, yet
strong enough to endure pressure brought about by the vibration of the center bearing.

Yet, an object of this utility model is to provide a vehicle-bearing cushion that has a much longer life span
than rubber bushings.

Still an object of this utility model is to provide a vehicle bearing cushion that has a very simple
construction and can be made using simple and ordinary molding equipment.

These and other objects and advantages will come to view and be understood upon a reading of the
detailed description when taken in conjunction with the accompanying drawings.

Figure 1 is a perspective view of the present utility model for a vehicle-bearing cushion; and

Figure 2 is a sectional view thereof.

Referring now to the several views of the drawing, wherein like reference numeral designate same parts
throughout, there is shown a utility model for a vehicle-bearing cushion generally designated as
reference numeral 10.

Said bearing cushion 10 comprises of a generally semi-circular body 11, having central hole 12 to house a
conventional bearing (not shown). As shown in Figure 1, said body 11 is provided with a plurality of
ridges 13 which serves reinforcing means thereof.

The subject bearing cushion 10 is made of polyvinyl chloride, a soft texture oil and chemical resistant
plastic material which is strong, durable and capable of enduring severe pressure from the center
bearing brought about by the rotating movement of the propeller shaft of the vehicle.[39]
A utility model is a technical solution to a problem in any field of human activity which is new and
industrially applicable. It may be, or may relate to, a product, or process, or an improvement of any of
the aforesaid.[40] Essentially, a utility model refers to an invention in the mechanical field. This is the
reason why its object is sometimes described as a device or useful object.[41] A utility model varies from
an invention, for which a patent for invention is, likewise, available, on at least three aspects: first, the
requisite of inventive step[42] in a patent for invention is not required; second, the maximum term of
protection is only seven years[43] compared to a patent which is twenty years,[44] both reckoned from
the date of the application; and third, the provisions on utility model dispense with its substantive
examination[45] and prefer for a less complicated system.

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.

No copyright granted by law can be said to arise in favor of the petitioner despite the issuance of the
certificates of copyright registration and the deposit of the Leaf Spring Eye Bushing and Vehicle Bearing
Cushion. Indeed, in Joaquin, Jr. v. Drilon[47] and Pearl & Dean (Phil.), Incorporated v. Shoemart,
Incorporated,[48] the Court ruled that:

Copyright, in the strict sense of the term, is purely a statutory right. It is a new or independent right
granted by the statute, and not simply a pre-existing right regulated by it. Being a statutory grant, the
rights are only such as the statute confers, and may be obtained and enjoyed only with respect to the
subjects and by the persons, and on terms and conditions specified in the statute. Accordingly, it can
cover only the works falling within the statutory enumeration or description.

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[49] and Pearl &
Dean (Phil.), Incorporated v. Shoemart, Incorporated,[50] 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. The Court
expounded further, thus:

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.

The petitioner cannot find solace in the ruling of the United States Supreme Court in Mazer v. Stein[51]
to buttress his petition. In that case, the artifacts involved in that case were statuettes of dancing male
and female figures made of semi-vitreous china. The controversy therein centered on the fact that
although copyrighted as works of art, the statuettes were intended for use and used as bases for table
lamps, with electric wiring, sockets and lampshades attached. The issue raised was whether the
statuettes were copyright protected in the United States, considering that the copyright applicant
intended primarily to use them as lamp bases to be made and sold in quantity, and carried such
intentions into effect. At that time, the Copyright Office interpreted the 1909 Copyright Act to cover
works of artistic craftsmanship insofar as their form, but not the utilitarian aspects, were concerned.
After reviewing the history and intent of the US Congress on its copyright legislation and the
interpretation of the copyright office, the US Supreme Court declared that the statuettes were held
copyrightable works of art or models or designs for works of art. The High Court ruled that:

Works of art (Class G) (a) In General. This class includes works of artistic craftsmanship, in so far as their
form but not their mechanical or utilitarian aspects are concerned, such as artistic jewelry, enamels,
glassware, and tapestries, as well as all works belonging to the fine arts, such as paintings, drawings and
sculpture.

So we have a contemporaneous and long-continued construction of the statutes by the agency charged
to administer them that would allow the registration of such a statuette as is in question here.[52]

The High Court went on to state that [t]he dichotomy of protection for the aesthetic is not beauty and
utility but art for the copyright and the invention of original and ornamental design for design patents.
Significantly, the copyright office promulgated a rule to implement Mazer to wit:

[I]f the sole intrinsic function of an article is its utility, the fact that the work is unique and attractively
shaped will not qualify it as a work of art.
In this case, the bushing and cushion are not works of art. They are, as the petitioner himself admitted,
utility models which may be the subject of a patent.

IN LIGHT OF ALL THE FOREGOING, the instant petition is hereby DENIED for lack of merit. The assailed
Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 70411 are AFFIRMED. Search Warrant
Nos. 01-2401 and 01-2402 issued on October 15, 2001 are ANNULLED AND SET ASIDE. Costs against the
petitioner.

SO ORDERED.

***************************************************************

Republic of the Philippines

SUPREME COURT

Manila

THIRD DIVISION

G.R. No. 97343 September 13, 1993

PASCUAL GODINES, petitioner,

vs.

THE HONORABLE COURT OF APPEALS, SPECIAL FOURTH DIVISION and SV-AGRO ENTERPRISES, INC.,
respondents.

Jesus S. Anonat for petitioner.

Arturo M. Alinio for private respondent.

ROMERO, J.:

Through this petition for review in certiorari of a decision of the Court of Appeals affirming the decision
of the trial court, petitioner Pascual Godines seeks to reverse the adverse decision of the Court a quo
that he was liable for infringement of patent and unfair competition. The dispositive portion of the
assailed decision is hereby quoted to wit:

WHEREFORE, with the elimination of the award for attorney's fees, the judgment appealed from is
hereby AFFIRMED, with costs against appellant. 1

The patent involved in this case is Letters Patent No. UM-2236 issued by the Philippine Patent Office to
one Magdalena S. Villaruz on July 15, 1976. It covers a utility model for a hand tractor or power tiller, the
main components of which are the following: "(1) a vacuumatic house float; (2) a harrow with adjustable
operating handle; (3) a pair of paddy wheels; (4) a protective water covering for the engine main drive;
(5) a transmission case; (6) an operating handle; (7) an engine foundation on the top midportion of the
vacuumatic housing float to which the main engine drive is detachedly installed; (8) a frontal frame
extension above the quarter circularly shaped water covering hold (sic) in place the transmission case;
(9) a V-belt connection to the engine main drive with transmission gear through the pulley, and (10) an
idler pulley installed on the engine foundation." 2 The patented hand tractor works in the following
manner: "the engine drives the transmission gear thru the V-belt, a driven pulley and a transmission
shaft. The engine drives the transmission gear by tensioning of the V-belt which is controlled by the idler
pulley. The V-belt drives the pulley attached to the transmission gear which in turn drives the shaft
where the paddy wheels are attached. The operator handles the hand tractor through a handle which is
inclined upwardly and supported by a pair of substanding pipes and reinforced by a U-shaped G.I. pipe at
the V-shaped end." 3

The above mentioned patent was acquired by SV-Agro Industries Enterprises, Inc., herein private
respondent, from Magdalena Villaruz, its chairman and president, by virtue of a Deed of Assignment
executed by the latter in its favor. On October 31, 1979, SV-Agro Industries caused the publication of the
patent in Bulletin Today, a newspaper of general circulation.
In accordance with the patent, private respondent manufactured and sold the patented power tillers
with the patent imprinted on them. In 1979, SV-Agro Industries suffered a decline of more than 50% in
sales in its Molave, Zamboanga del Sur branch. Upon investigation, it discovered that power tillers similar
to those patented by private respondent were being manufactured and sold by petitioner herein.
Consequently, private respondent notified Pascual Godines about the existing patent and demanded that
the latter stop selling and manufacturing similar power tillers. Upon petitioner's failure to comply with
the demand, SV-Agro Industries filed before the Regional Trial Court a complaint for infringement of
patent and unfair competition.

After trial, the court held Pascual Godines liable for infringement of patent and unfair competition. The
dispositive portion of the decision reads as follows:

WHEREFORE, premises considered, JUDGMENT is hereby rendered in favor of the plaintiff SV-Agro
Industries Enterprises, Inc., and against defendant Pascual Godines:

1. Declaring the writ of preliminary injunction issued by this Court against defendant as
permanent;

2. Ordering defendant Pascual Godines to pay plaintiff the sum of Fifty Thousand Pesos
(P50,000.00) as damages to its business reputation and goodwill, plus the further sum of Eighty
Thousand Pesos (P80,000.00) for unrealized profits during the period defendant was manufacturing and
selling copied or imitation floating power tiller;

3. Ordering the defendant to pay the plaintiff, the further sum of Eight Thousand Pesos (P8,000.00)
as reimbursement of attorney's fees and other expenses of litigation; and to pay the costs of the suit.

SO ORDERED. 4

The decision was affirmed by the appellate court.

Thereafter, this petition was filed. Petitioner maintains the defenses which he raised before the trial and
appellate courts, to wit: that he was not engaged in the manufacture and sale of the power tillers as he
made them only upon the special order of his customers who gave their own specifications; hence, he
could not be liable for infringement of patent and unfair competition; and that those made by him were
different from those being manufactured and sold by private respondent.

We find no merit in his arguments. The question of whether petitioner was manufacturing and selling
power tillers is a question of fact better addressed to the lower courts. In dismissing the first argument of
petitioner herein, the Court of Appeals quoted the findings of the court, to wit:

It is the contention of defendant that he did not manufacture or make imitations or copies of plaintiff's
turtle power tiller as what he merely did was to fabricate his floating power tiller upon specifications and
designs of those who ordered them. However, this contention appears untenable in the light of the
following circumstances: 1) he admits in his Answer that he has been manufacturing power tillers or
hand tractors, selling and distributing them long before plaintiff started selling its turtle power tiller in
Zamboanga del Sur and Misamis Occidental, meaning that defendant is principally a manufacturer of
power tillers, not upon specification and design of buyers, but upon his own specification and design; 2)
it would be unbelievable that defendant would fabricate power tillers similar to the turtle power tillers of
plaintiff upon specifications of buyers without requiring a job order where the specification and designs
of those ordered are specified. No document was (sic) ever been presented showing such job orders,
and it is rather unusual for defendant to manufacture something without the specification and designs,
considering that he is an engineer by profession and proprietor of the Ozamis Engineering shop. On the
other hand, it is also highly unusual for buyers to order the fabrication of a power tiller or hand tractor
and allow defendant to manufacture them merely based on their verbal instructions. This is contrary to
the usual business and manufacturing practice. This is not only time consuming, but costly because it
involves a trial and error method, repeat jobs and material wastage. Defendant judicially admitted two
(2) units of the turtle power tiller sold by him to Policarpio Berondo. 5

Of general acceptance is the rule imbedded in our jurisprudence that ". . . the jurisdiction of the
Supreme Court in cases brought to it from the Court of Appeals in a petition for certiorari under Rule 45
of the Rules of Court is limited to the review of errors of law, and that said appellate court's findings of
fact are conclusive upon this Court." 6

The fact that petitioner herein manufactured and sold power tillers without patentee's authority has
been established by the courts despite petitioner's claims to the contrary.
The question now arises: Did petitioner's product infringe upon the patent of private respondent?

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, ". . . 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. 9

The trial court made the following observation:

Samples of the defendant's floating power tiller have been produced and inspected by the court and
compared with that of the turtle power tiller of the plaintiff (see Exhibits H to H-28). In appearance and
form, both the floating power tillers of the defendant and the turtle power tiller of the plaintiff are
virtually the same. Defendant admitted to the Court that two (2) of the power inspected on March 12,
1984, were manufactured and sold by him (see TSN, March 12, 1984, p. 7). The three power tillers were
placed alongside with each other. At the center was the turtle power tiller of plaintiff, and on both sides
thereof were the floating power tillers of defendant (Exhibits H to H-2). Witness Rodrigo took
photographs of the same power tillers (front, side, top and back views for purposes of comparison (see
Exhibits H-4 to H-28). Viewed from any perspective or angle, the power tiller of the defendant is identical
and similar to that of the turtle power tiller of plaintiff in form, configuration, design and appearance.
The parts or components thereof are virtually the same. Both have the circularly-shaped vacuumatic
housing float, a paddy in front, a protective water covering, a transmission box housing the transmission
gears, a handle which is V-shaped and inclined upwardly, attached to the side of the vacuumatic housing
float and supported by the upstanding G.I. pipes and an engine base at the top midportion of the
vacuumatic housing float to which the engine drive may be attached. In operation, the floating power
tiller of the defendant operates also in similar manner as the turtle power tiller of plaintiff. This was
admitted by the defendant himself in court that they are operating on the same principles. (TSN, August
19, 1987, p. 13) 10

Moreover, it is also observed that petitioner also called his power tiller as a floating power tiller. The
patent issued by the Patent Office referred to a "farm implement but more particularly to a turtle hand
tractor having a vacuumatic housing float on which the engine drive is held in place, the operating
handle, the harrow housing with its operating handle and the paddy wheel protective covering." 11 It
appears from the foregoing observation of the trial court that these claims of the patent and the
features of the patented utility model were copied by petitioner. We are compelled to arrive at no other
conclusion but that there was infringement.

Petitioner's argument that his power tillers were different from private respondent's is that of a
drowning man clutching at straws.

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. 14

In this case, the trial court observed:

Defendant's witness Eduardo Caete, employed for 11 years as welder of the Ozamis Engineering, and
therefore actually involved in the making of the floating power tillers of defendant tried to explain the
difference between the floating power tillers made by the defendant. But a careful examination between
the two power tillers will show that they will operate on the same fundamental principles. And,
according to establish jurisprudence, in infringement of patent, similarities or differences are to be
determined, not by the names of things, but in the light of what elements do, and substantial, rather
than technical, identity in the test. More specifically, it is necessary and sufficient to constitute
equivalency that the same function can be performed in substantially the same way or manner, or by the
same or substantially the same, principle or mode of operation; but where these tests are satisfied, mere
differences of form or name are immaterial. . . . 15

It also stated:
To establish an infringement, it is not essential to show that the defendant adopted the device or process
in every particular; Proof of an adoption of the substance of the thing will be sufficient. "In one sense,"
said Justice Brown, "it may be said that no device can be adjudged an infringement that does not
substantially correspond with the patent. But another construction, which would limit these words to
exact mechanism described in the patent, would be so obviously unjust that no court could be expected
to adopt it. . . .

The law will protect a patentee against imitation of his patent by other forms and proportions. If two
devices do the same work in substantially the same way, and accomplish substantially the same result,
they are the same, even though they differ in name, form, or shape. 16

We pronounce petitioner liable for infringement in accordance with Section 37 of Republic Act No. 165,
as amended, providing, inter alia:

Sec. 37. Right of Patentees. A patentee shall have the exclusive right to make, use and sell the
patented machine, article or product, and to use the patented process for the purpose of industry or
commerce, throughout the territory of the Philippines for the terms of the patent; and such making,
using, or selling by any person without the authorization of the Patentee constitutes infringement of the
patent. (Emphasis ours)

As far as the issue regarding unfair competition is concerned, suffice it to say that Republic Act No. 166,
as amended, provides, inter alia:

Sec. 29. Unfair competition, rights and remedies. . . .

xxx xxx xxx

In particular, and without in any way limiting the scope of unfair competition, the following shall be
deemed guilty of unfair competition:
(a) Any person, who in selling his goods shall give them the general appearance of goods of another
manufacturer or dealer, either as to the goods themselves or in the wrapping of the packages in which
they are contained, or the devices or words thereon, or in any other feature of their appearance, which
would be likely to influence purchasers that the goods offered are those of a manufacturer or dealer
other than the actual manufacturer or dealer, or who otherwise clothes the goods with such appearance
as shall deceive the public and defraud another of his legitimate trade. . . .

xxx xxx xxx

Considering the foregoing, we find no reversible error in the decision of the Court of Appeals affirming
with modification the decision of the trial court.

WHEREFORE, premises considered, the decision of the Court of Appeals is hereby AFFIRMED and this
petition DENIED for lack of merit.

**************************************

Republic of the Philippines

SUPREME COURT

Manila

EN BANC

G.R. No. L-20354 July 28, 1969

GERARDO SAMSON, JR., petitioner,

vs.

FELIPE TARROZA and DIRECTOR OF PATENTS, respondents.

Hermenegildo V. Lopez for petitioner.

Isaac S. Puno, Jr. for respondent Felipe Tarroza.

Office of the Solicitor General for respondent Director of Patents.

FERNANDO, J.:

With the statutory recognition of patentability based on the "practical utility" concept 1 thus rendering
clear that a patent is not solely to be earned under the "flash of genius" theory, 2 this petition for the
cancellation of a utility model patent for a Side Tilting-Dumping Wheelbarrow granted to respondent
Felipe A. Tarroza was correctly denied by respondent Director of Patents. Petitioner Gerardo Samson, Jr.,
himself the grantee of a utility model patent for a Dumping and Detachable Wheelbarrow, lacked any
legal justification for such a plea. So respondent Director ruled. Not satisfied, petitioner elevated the
matter to us for review. There is no reason why a different outcome is to be expected. His appeal must
fail.

Petitioner was, on May 22, 1958, awarded Utility Model Patent No. 27 for the above type of
wheelbarrow which, as noted in the decision, "consists of a wheeled carriage base and an upper pivoted
and detachable carrying tray. The carriage base is comprised of a wheel and two equal lengths of
continuous pipes bent to provide wheel forks at the front and at the rear to support the back portion of
the tray, with the ends of the pipes being adopted as the carrying handles for the wheelbarrow. The two
pipes thus bent are joined together by cross braces in the front and at the rear. The tray is removably
pivoted at its front end through hook catches at its bottom corners, to the forward cross brace, and its
rear end rests solidly over the rear portion of the legs. To dump the load the user pulls a dumping handle
at the back end to cause the tray to pivot upwardly about the front brace to a position of about 45
degrees with the horizontal and with its front end panel being supported by the wheel." 3

Respondent's Side Tilting-Dumping Wheelbarrow, on the other hand, consists "of a wheeled carriage
made of tubular frames essentially as in petitioner's. Welded transversely to the parallel frames are two
brackets provided with holes designed to complement similar holes on brackets provided on the tray.
The brackets on the tray are so placed that with the provision of a bolt through the openings the tray
may be tilted approximately 170 degrees to the left or to the right of the wheelbarrow with its axis
running longitudinally through the center of the bottom face of the tray." 4
There is an express recognition under the Patent Law, as already noted, that any new model of
implements or tools or of any industrial product even if not possessed of the quality of invention but
which is of "practical utility" is entitled to a "patent for a utility model." From the above description of
the side tilting-dumping wheelbarrow, the product of respondent's ingenuity and industry, it is quite
apparent that it has a place in the market and possesses what the statute refers to as "practical utility."
The requirement explicitly set forth in the statute has thus been met. Respondent Tarroza is entitled to
its benefits. The grant to him of a patent for a utility model is in accordance with law. There was no
reason, therefore, for its cancellation. So it was held by the Director of Patents. That decision as already
noted should stand.

Moreover, in appeals from a decision of the Director of Patents, only questions of law may be reviewed,
findings of facts being conclusive unless unsupported by substantial evidence. So it was decided in Che v.
Philippines Patent Office. 5 As was emphasized in Bagano v. Director of Patents: "It is almost trite to state
here that in cases of the nature as the one at bar, only questions of law are to be raised in order that this
Court could exercise its appellate jurisdiction and review the decision." 6 The above well-settled
doctrines suffice to demonstrate that this petition for review, as noted at the outset, is without merit. It
was not error then, to reiterate, for the respondent Director of Patents to deny the cancellation of the
utility patent granted respondent Tarroza. To borrow from the language of the Che opinion: "Even on the
sole issue alone, the petition for review must fail."

Another alleged error was imputed to respondent Director of Patents. It would find fault with his failing
to hold that respondent Tarroza "was not the true and actual" author of the mechanical contrivance for
which he was granted a utility model patent. This is what the appealed decision has to say on this point:
"Petitioner's theory with respect to the second ground for cancellation, to wit: that respondent is not the
true and actual inventor or designer of the utility model is premised on the fact that because of the
proximity of the two, the petitioner and the respondent being brothers-in-law, and living in adjoining
residential lots, the latter has had ample time and opportunity to observe and copy the former's
wheelbarrow. But the testimonial evidence thus presented is not clear, satisfactory, and free from doubt,
in the face of allegations to the contrary by the respondent." 7 The futility of such an assignment of error
is thus apparent. Again, it is factual in character. It is not for us, as noted above, to review or revise the
same, there being no showing of a lack of substantial evidence in support thereof.

WHEREFORE, the decision of April 13, 1962 of respondent Director of Patents denying the petition for
the cancellation of Utility Model Letters Patent No. 62 in favor of respondent Tarroza is hereby affirmed.
With costs against petitioner.
*******************************************

FIRST DIVISION

[G.R. Nos. 160054-55. July 21, 2004]

MANOLO P. SAMSON, petitioner, vs. HON. REYNALDO B. DAWAY, in his capacity as Presiding Judge,
Regional Trial Court of Quezon City, Branch 90, PEOPLE OF THE PHILIPPINES and CATERPILLAR, INC.,
respondents.

DECISION

YNARES-SANTIAGO, J.:

Assailed in this petition for certiorari is the March 26, 2003 Order[1] of the Regional Trial Court of
Quezon City, Branch 90, which denied petitioners (1) motion to quash the information; and (2) motion
for reconsideration of the August 9, 2002 Order denying his motion to suspend the arraignment and
other proceedings in Criminal Case Nos. Q-02-108043-44. Petitioner also questioned its August 5, 2003
Order[2] which denied his motion for reconsideration.

The undisputed facts show that on March 7, 2002, two informations for unfair competition under
Section 168.3 (a), in relation to Section 170, of the Intellectual Property Code (Republic Act No. 8293),
similarly worded save for the dates and places of commission, were filed against petitioner Manolo P.
Samson, the registered owner of ITTI Shoes. The accusatory portion of said informations read:

That on or about the first week of November 1999 and sometime prior or subsequent thereto, in Quezon
City, Philippines, and within the jurisdiction of this Honorable Court, above-named accused,
owner/proprietor of ITTI Shoes/Mano Shoes Manufactuirng Corporation located at Robinsons Galleria,
EDSA corner Ortigas Avenue, Quezon City, did then and there willfully, unlawfully and feloniously
distribute, sell and/or offer for sale CATERPILLAR products such as footwear, garments, clothing, bags,
accessories and paraphernalia which are closely identical to and/or colorable imitations of the authentic
Caterpillar products and likewise using trademarks, symbols and/or designs as would cause confusion,
mistake or deception on the part of the buying public to the damage and prejudice of CATERPILLAR, INC.,
the prior adopter, user and owner of the following internationally: CATERPILLAR, CAT, CATERPILLAR &
DESIGN, CAT AND DESIGN, WALKING MACHINES and TRACK-TYPE TRACTOR & DESIGN.

CONTRARY TO LAW.[3]
On April 19, 2002, petitioner filed a motion to suspend arraignment and other proceedings in view of the
existence of an alleged prejudicial question involved in Civil Case No. Q-00-41446 for unfair competition
pending with the same branch; and also in view of the pendency of a petition for review filed with the
Secretary of Justice assailing the Chief State Prosecutors resolution finding probable cause to charge
petitioner with unfair competition. In an Order dated August 9, 2002, the trial court denied the motion
to suspend arraignment and other proceedings.

On August 20, 2002, petitioner filed a twin motion to quash the informations and motion for
reconsideration of the order denying motion to suspend, this time challenging the jurisdiction of the trial
court over the offense charged. He contended that since under Section 170 of R.A. No. 8293, the
penalty5 of imprisonment for unfair competition does not exceed six years, the offense is cognizable by
the Municipal Trial Courts and not by the Regional Trial Court, per R.A. No. 7691.

In its assailed March 26, 2003 Order, the trial court denied petitioners twin motions.6 A motion for
reconsideration thereof was likewise denied on August 5, 2003.

Hence, the instant petition alleging that respondent Judge gravely abused its discretion in issuing the
assailed orders.

The issues posed for resolution are (1) Which court has jurisdiction over criminal and civil cases for
violation of intellectual property rights? (2) Did the respondent Judge gravely abuse his discretion in
refusing to suspend the arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44 on
the ground of (a) the existence of a prejudicial question; and (b) the pendency of a petition for review
with the Secretary of Justice on the finding of probable cause for unfair competition?

Under Section 170 of R.A. No. 8293, which took effect on January 1, 1998, the criminal penalty for
infringement of registered marks, unfair competition, false designation of origin and false description or
representation, is imprisonment from 2 to 5 years and a fine ranging from Fifty Thousand Pesos to Two
Hundred Thousand Pesos, to wit:

SEC. 170. Penalties. Independent of the civil and administrative sanctions imposed by law, a criminal
penalty of imprisonment from two (2) years to five (5) years and a fine ranging from Fifty thousand pesos
(P50,000.00) to Two hundred thousand pesos (P200,000.00), shall be imposed on any person who is
found guilty of committing any of the acts mentioned in Section 155 [Infringement], Section 168 [Unfair
Competition] and Section 169.1 [False Designation of Origin and False Description or Representation].

Corollarily, Section 163 of the same Code states that actions (including criminal and civil) under Sections
150, 155, 164, 166, 167, 168 and 169 shall be brought before the proper courts with appropriate
jurisdiction under existing laws, thus

SEC. 163. Jurisdiction of Court. All actions under Sections 150, 155, 164 and 166 to 169 shall be brought
before the proper courts with appropriate jurisdiction under existing laws. (Emphasis supplied)
The existing law referred to in the foregoing provision is Section 27 of R.A. No. 166 (The Trademark Law)
which provides that jurisdiction over cases for infringement of registered marks, unfair competition, false
designation of origin and false description or representation, is lodged with the Court of First Instance
(now Regional Trial Court)

SEC. 27. Jurisdiction of Court of First Instance. All actions under this Chapter [V Infringement] and
Chapters VI [Unfair Competition] and VII [False Designation of Origin and False Description or
Representation], hereof shall be brought before the Court of First Instance.

We find no merit in the claim of petitioner that R.A. No. 166 was expressly repealed by R.A. No. 8293.
The repealing clause of R.A. No. 8293, reads

SEC. 239. Repeals. 239.1. All Acts and parts of Acts inconsistent herewith, more particularly Republic Act
No. 165, as amended; Republic Act No. 166, as amended; and Articles 188 and 189 of the Revised Penal
Code; Presidential Decree No. 49, including Presidential Decree No. 285, as amended, are hereby
repealed. (Emphasis added)

Notably, the aforequoted clause did not expressly repeal R.A. No. 166 in its entirety, otherwise, it would
not have used the phrases parts of Acts and inconsistent herewith; and it would have simply stated
Republic Act No. 165, as amended; Republic Act No. 166, as amended; and Articles 188 and 189 of the
Revised Penal Code; Presidential Decree No. 49, including Presidential Decree No. 285, as amended are
hereby repealed. It would have removed all doubts that said specific laws had been rendered without
force and effect. The use of the phrases parts of Acts and inconsistent herewith only means that the
repeal pertains only to provisions which are repugnant or not susceptible of harmonization with R.A. No.
8293.7 Section 27 of R.A. No. 166, however, is consistent and in harmony with Section 163 of R.A. No.
8293. Had R.A. No. 8293 intended to vest jurisdiction over violations of intellectual property rights with
the Metropolitan Trial Courts, it would have expressly stated so under Section 163 thereof.

Moreover, the settled rule in statutory construction is that in case of conflict between a general law and
a special law, the latter must prevail. Jurisdiction conferred by a special law to Regional Trial Courts must
prevail over that granted by a general law to Municipal Trial Courts.8

In the case at bar, R.A. No. 8293 and R.A. No. 166 are special laws9 conferring jurisdiction over violations
of intellectual property rights to the Regional Trial Court. They should therefore prevail over R.A. No.
7691, which is a general law.10 Hence, jurisdiction over the instant criminal case for unfair competition is
properly lodged with the Regional Trial Court even if the penalty therefor is imprisonment of less than 6
years, or from 2 to 5 years and a fine ranging from P50,000.00 to P200,000.00.
In fact, to implement and ensure the speedy disposition of cases involving violations of intellectual
property rights under R.A. No. 8293, the Court issued A.M. No. 02-1-11-SC dated February 19, 2002
designating certain Regional Trial Courts as Intellectual Property Courts. On June 17, 2003, the Court
further issued a Resolution consolidating jurisdiction to hear and decide Intellectual Property Code and
Securities and Exchange Commission cases in specific Regional Trial Courts designated as Special
Commercial Courts.

The case of Mirpuri v. Court of Appeals,11 invoked by petitioner finds no application in the present case.
Nowhere in Mirpuri did we state that Section 27 of R.A. No. 166 was repealed by R.A. No. 8293. Neither
did we make a categorical ruling therein that jurisdiction over cases for violation of intellectual property
rights is lodged with the Municipal Trial Courts. The passing remark in Mirpuri on the repeal of R.A. No.
166 by R.A. No. 8293 was merely a backgrounder to the enactment of the present Intellectual Property
Code and cannot thus be construed as a jurisdictional pronouncement in cases for violation of
intellectual property rights.

Anent the second issue, petitioner failed to substantiate his claim that there was a prejudicial question.
In his petition, he prayed for the reversal of the March 26, 2003 order which sustained the denial of his
motion to suspend arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44. For
unknown reasons, however, he made no discussion in support of said prayer in his petition and reply to
comment. Neither did he attach a copy of the complaint in Civil Case No. Q-00-41446 nor quote the
pertinent portion thereof to prove the existence of a prejudicial question.

At any rate, there is no prejudicial question if the civil and the criminal action can, according to law,
proceed independently of each other.12 Under Rule 111, Section 3 of the Revised Rules on Criminal
Procedure, in the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code, the independent civil
action may be brought by the offended party. It shall proceed independently of the criminal action and
shall require only a preponderance of evidence.

In the case at bar, the common element in the acts constituting unfair competition under Section 168 of
R.A. No. 8293 is fraud.13 Pursuant to Article 33 of the Civil Code, in cases of defamation, fraud, and
physical injuries, a civil action for damages, entirely separate and distinct from the criminal action, may
be brought by the injured party. Hence, Civil Case No. Q-00-41446, which as admitted14 by private
respondent also relate to unfair competition, is an independent civil action under Article 33 of the Civil
Code. As such, it will not operate as a prejudicial question that will justify the suspension of the criminal
cases at bar.

Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure provides

SEC. 11. Suspension of arraignment. Upon motion by the proper party, the arraignment shall be
suspended in the following cases
xxxxxxxxx

(c) A petition for review of the resolution of the prosecutor is pending at either the Department of
Justice, or the Office of the President; Provided, that the period of suspension shall not exceed sixty (60)
days counted from the filing of the petition with the reviewing office.

While the pendency of a petition for review is a ground for suspension of the arraignment, the aforecited
provision limits the deferment of the arraignment to a period of 60 days reckoned from the filing of the
petition with the reviewing office. It follows, therefore, that after the expiration of said period, the trial
court is bound to arraign the accused or to deny the motion to defer arraignment.

In the instant case, petitioner failed to establish that respondent Judge abused his discretion in denying
his motion to suspend. His pleadings and annexes submitted before the Court do not show the date of
filing of the petition for review with the Secretary of Justice.15 Moreover, the Order dated August 9,
2002 denying his motion to suspend was not appended to the petition. He thus failed to discharge the
burden of proving that he was entitled to a suspension of his arraignment and that the questioned
orders are contrary to Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure. Indeed, the
age-old but familiar rule is that he who alleges must prove his allegations.

In sum, the dismissal of the petition is proper considering that petitioner has not established that the
trial court committed grave abuse of discretion. So also, his failure to attach documents relevant to his
allegations warrants the dismissal of the petition, pursuant to Section 3, Rule 46 of the Rules of Civil
Procedure, which states:

SEC. 3. Contents and filing of petition; effect of non-compliance with requirements. The petition shall
contain the full names and actual addresses of all the petitioners and respondents, a concise statement
of the matters involved, the factual background of the case, and the grounds relied upon for the relief
prayed for.

It shall be filed in seven (7) clearly legible copies together with proof of service thereof on the
respondent with the original copy intended for the court indicated as such by the petitioner, and shall be
accompanied by a clearly legible duplicate original or certified true copy of the judgment, order,
resolution, or ruling subject thereof, such material portions of the record as are referred to therein, and
other documents relevant or pertinent thereto.

xxxxxxxxx
The failure of the petitioner to comply with any of the foregoing requirements shall be sufficient ground
for the dismissal of the petition. (Emphasis added)

WHEREFORE, in view of all the foregoing, the petition is DISMISSED.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Quisumbing, Carpio, and Azcuna, JJ., concur.

[1] Rollo, p. 25. Issued by Judge Reynaldo B. Daway.

[2] Rollo, p. 26.

[3] Id., pp. 27-28.

5 Imprisonment from two (2) years to five (5) years and a fine ranging from Fifty Thousand Pesos
(P50,000.00) to Two Hundred Thousand Pesos (P200,000.00).

6 The dispositive portion thereof states: IN VIEW OF THE FOREGOING, the accuseds aforecited Motion To
Quash Information and Motion For Reconsideration Of Order Denying Motion To Suspend is denied for
lack of merit. (Rollo, p. 25)

7 Agpalo, The Law on Trademark, Infringement and Unfair Competition, 2000 Edition, pp. 1-2.

8 Manzano v. Valera, G.R. No. 122068, 8 July 1998, 292 SCRA 66, 74.

9 Faberge Incorporated v. Intermediate Appellate Court, G.R. No. 71189, 4 November 1992, 215 SCRA
316, 323.

10 Manzano v. Valera, supra, p. 73.

11 376 Phil. 628 (1999).

12 People v. Consing, Jr., G.R. No. 148193, 16 January 2003, 395 SCRA 366, 371.

13 Agpalo, supra, p. 234.

14 Rollo, p. 47.

15 The petition and reply to comment do not disclose whether the issue of probable cause has already
been resolved with finality.