INTELLECTUAL PROPERTY LAW

A. PATENT
1.PATENTABLE INVENTION
   Any technical solution of a problem in any field of human activity which is new, involves an inventive step and is
industrially applicable shall be patentable. It may be, or may relate to, a product, or process, or an improvement of any of the
foregoing.
NON-PATENTABLE INVENTION
      Non-Patentable Inventions. - The following shall be excluded from patent protection:
22.1. Discoveries, scientific theories and mathematical methods;
22.2. Schemes, rules and methods of performing mental acts, playing games or doing business, and programs for computers;
22.3 Methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practiced on the human or
animal body. This provision shall not apply to products and composition for use in any of these methods;
22.4. Plant varieties or animal breeds or essentially biological process for the production of plants or animals. This provision shall not
apply to micro-organisms and non-biological and microbiological processes.
Provisions under this subsection shall not preclude Congress to consider the enactment of a law providing sui generis protection of
plant varieties and animal breeds and a system of community intellectual rights protection:
22.5. Aesthetic creations; and
22.6. Anything which is contrary to public order or morality.

2. OWNERSHIP OF PATENT (SECTION 71)

Persons entitled to a patent
Inventor, his heirs, or assigns (IPC, Sec 28);
Joint invention – Jointly by the inventors (IPC, Sec. 28);
Two or more persons invented separately and independently of each other – To the person who filed an application;

FIRST-TO-FILE RULE
1. If two (2) or more persons have made the invention separately and independently of each other, the right to the patent shall belong
to the person who filed an application for such invention, or
2. Where two or more applications are filed for the same invention, to the applicant which has the earliest filing date (IPC, Sec. 29).
INVENTIONS CREATED PURSUANT TO A COMMISSION

Pursuant to a commission: The person who commissions the work shall own the patent, unless otherwise provided in the contract.

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

a. The employee, if the inventive activity is not a part of his regular duties even if the employee uses the time, facilities and
materials of the employer;
b. The employer, if the inventive activity is the result of the performance of his regularly- assigned duties, unless there is an
agreement, express or implied, to the contrary (IPC, Sec. 30).

Q: As between the inventor and the person who commissioned the inventor to create a new work, who owns the patent?

A: The person who commissions the work shall own the patent, unless otherwise provided in the contract. (IPC, Sec. 30)

RIGHT OF PRIORITY

Priority date

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

Filing Date is accorded only when all the requirements provided under Section 40 are present. Priority Date comes into play when
there is an application for patent for the same invention that was filed in another country (Salao, 2012).

Conditions in availing of priority date

1.The local application expressly claims priority;
2. It is filed within 12 months from the date the earliest foreign application was filed; and
3. A certified copy of the foreign application together with an English translation is filed within 6 months from the date of filing in the
Philippines. (Sec. 31, IPC)

3. GROUNDS FOR CANCELLATION OF PATENT (Sec. 61)

Cancellation of Patents. -
61.1. Any interested person may, upon payment of the required fee, petition to cancel the patent or any claim thereof, or parts of the
claim, on any of the following grounds:
(a) That what is claimed as the invention is not new or patentable;
(b) That the patent does not disclose the invention in a manner sufficiently clear and complete for it to be carried out by any person
skilled in the art; or
(c) That the patent is contrary to public order or morality.

61.2. Where the grounds for cancellation relate to some of the claims or parts of the claim, cancellation may be effected to such extent
only.
Grounds for cancellation of a utility model

1. The invention does not qualify for registration as a utility model;

2. That the description and the claims do not comply with the prescribed requirements;
3. Any drawing which is necessary for the understanding of the invention has not been furnished;
4. That the owner of the utility model registration is not the inventor or his successor in title (IPC, Sec. 109.4).

Grounds for cancellation of an industrial design

1. The subject matter of the industrial design is not registrable;
2. The subject matter is not new; or
3. The subject matter of the industrial design extends beyond the content of the application as originally filed (IPC, Sec. 120).

Grounds for Cancellation of Layout-Design of Integrated Circuits

1. The layout-design is not protectable;
2. The right holder is not entitled to protection:
3. Where the application for registration of the layout-design, was not filed within two (2) years from its first commercial exploitation
anywhere in the world.

Where the grounds for cancellation are established with respect only to a part of the layout-design, only the corresponding part of the
registration shall be cancelled (IPC, Sec. 120.3, as amended by RA 9150)

4. REMEDIES OF THE TRUE AND ACTUAL INVENTOR (SEC. 68)

If a person, who was deprived of the patent without his consent or through fraud is declared by final court order or decision to be the
true and actual inventor, the court shall order for his substitution as patentee, or at the option of the true inventor, cancel the patent,
and award actual and other damages in his favor if warranted by the circumstances.
Remedies of persons with a right to a patent

If a person other than the applicant is declared by final court order or decision as having the right to a patent, he may within 3 months
after such decision has become final:

1. Prosecute the application as his own

2. File a new patent application
3. Request the application to be refused; or
4.Seek cancellation of the patent (IPC, Sec. 67.1).

5. RIGHTS CONFERRED BY PATENT

Sec. 71. Rights Conferred by Patent. -

71.1. A patent shall confer on its owner the following exclusive rights:
(a) Where the subject matter of a patent is a product, to restrain, prohibit and prevent any unauthorized person or entity from making,
using, offering for sale, selling or importing that product;
(b) Where the subject matter of a patent is a process, to restrain, prevent or prohibit any unauthorized person or entity from using the
process, and from manufacturing, dealing in, using, selling or offering for sale, or importing any product obtained directly or indirectly
from such process.
71.2. Patent owners shall also have the right to assign, or transfer by succession the patent, and to conclude licensing contracts for the
same
6. LIMITATION OF PATENT RIGHTS (Section 72)
Limitations of Patent Rights. — The owner of a patent has no right to prevent third parties from performing, without his authorization,
the acts referred to in Section 71 hereof in the following circumstances:
72.1. (DOCTRINE OF NATIONAL EXHAUSTION) Using a patented product which has been put on the market in the Philippines
by the owner of the product, or with his express consent, insofar as such use is performed after that product has been so put on the said
market;
72.2. Where the act is done privately and on a non-commercial scale or for a non-commercial purpose: Provided, That it does not
significantly prejudice the economic interests of the owner of the patent;
72.3. Where the act consists of making or using exclusively for the purpose of experiments that relate to the subject matter of the
patented invention;
72.4. Where the act consists of the preparation for individual cases, in a pharmacy or by a medical professional, of a medicine in
accordance with a medical prescription or acts concerning the medicine so prepared;
72.5. Where the invention is used in any ship, vessel, aircraft, or land vehicle of any other country entering the territory of the
Philippines temporarily or accidentally: Provided, That such invention is used exclusively for the needs of the ship, vessel, aircraft, or
land vehicle and not used for the manufacturing of anything to be sold within the Philippines. (Secs. 38 and 39, R.A. No. 165a)
Prior user

Person other than the applicant, who in good faith, started using the invention in the Philippines, or undertaken serious preparations to
use the same, before the filing date or priority date of the application shall have the right to continue the use thereof, but this right shall
only be transferred or assigned further with his enterprise or business (IPC, Sec. 73).

Use by Government

A Government agency or third person authorized by the Government may exploit the invention even without agreement of the patent
owner where:
a. The public interest, in particular, national security, nutrition, health or the development of other sectors, as determined by the
appropriate agency of the government, so requires; or
b. A judicial or administrative body has determined that the manner of exploitation, by the owner of the patent or his licensee, is anti-
competitive; or
c. In the case of drugs and medicines, there is a national emergency or other circumstance of extreme urgency requiring the use of the
invention; or
d. In the case of drugs and medicines, there is a public non-commercial use of the patent by the patentee, without satisfactory reason;
or
e. In the case of drugs and medicines, the demand for the patented article in the Philippines is not being met to an adequate extent and
on reasonable terms, as determined by the Secretary of the Department of Health.

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

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

Exemptions:

a. Parallel importation for patented drugs and medicines;

Parallel importer is one who imports, distributes, and sells genuine products in the market, independently of an exclusive
distributorship or agency agreement with the manufacturer;

b. In the case of drugs and medicines, where the act includes testing, using, making or selling the invention including any data related
thereto, solely for purposes reasonably related to the development and submission of information and issuance of approvals by
government regulatory agencies required under any law of the Philippines or of another country that regulates the manufacture,
construction, use or sale of any product;
c. Use of Invention by Government;
d. Compulsory licensing; and
e. Procedures on Issuance of a Special Compulsory License under the TRIPS Agreement for patented drugs and medicines.
Contributory Infringement
Anyone who actively induces the infringement of a patent or provides the infringer with a component of a patented product or of a
product produced because of a patented process knowing it to be especially adopted for infringing the patented invention and not
suitable for substantial non- infringing use shall be liable as a contributory infringer and shall be jointly and severally liable with the
infringer. (Sec. 76.6, IPC)

Criminal Infringement

If infringement is repeated by the infringer or by anyone in connivance with him after finality of the judgment of the court against the
infringer, the offenders shall, without prejudice to the institution of a civil action for damages, be criminally liable. (IPC, Sec. 84)

The criminal liability will arise only if the infringement is repeated, even if after the finality of judgment of the court in the civil action
against the infringer or anyone in connivance with him. (IPC, Sec. 84)

CIVIL ACTION FOR INFRINGEMENT

SECTION 76. CIVIL ACTION FOR INFRINGEMENT.
76.1. The making, using, offering for sale, selling, or importing a patented product or a product obtained directly or indirectly from a
patented process, or the use of a patented process without the authorization of the patentee constitutes patent infringement.
76.2. Any patentee, or anyone possessing any right, title or interest in and to the patented invention, whose rights have been infringed,
may bring a civil action before a court of competent jurisdiction, to recover from the infringer such damages sustained thereby, plus
attorney's fees and other expenses of litigation, and to secure an injunction for the protection of his rights.
76.3. If the damages are inadequate or cannot be readily ascertained with reasonable certainty, the court may award by way of
damages a sum equivalent to reasonable royalty.
76.4. The court may, according to the circumstances of the case, award damages in a sum above the amount found as actual damages
sustained: Provided, That the award does not exceed three (3) times the amount of such actual damages.
76.5. The court may, in its discretion, order that the infringing goods, materials and implements predominantly used in the
infringement be disposed of outside the channels of commerce or destroyed, without compensation.
76.6. Anyone who actively induces the infringement of a patent or provides the infringer with a component of a patented product or of
a product produced because of a patented process knowing it to be especially adopted for infringing the patented invention and not
suitable for substantial non-infringing use shall be liable as a contributory infringer and shall be jointly and severally liable with the
infringer. (Sec. 42, R.A. No. 165a)

CRIMINAL ACTION FOR INFRINGEMENT

Criminal Action for Repetition of Infringement. — If infringement is repeated by the infringer or by anyone in connivance with him
after finality of the judgment of the court against the infringer, the offenders shall, without prejudice to the institution of a civil action
for damages, be criminally liable therefor and, upon conviction, shall suffer imprisonment for the period of not less than six (6)
months but not more than three (3) years and/or a fine of not less than One hundred thousand pesos (P100,000) but not more than
Three hundred thousand pesos (P300,000), at the discretion of the court. The criminal action herein provided shall prescribe in three
(3) years from date of the commission of the crime. (Section 84)
NOTICE TO INFRINGER
Damages cannot be recovered for acts of infringement committed before the infringer had known, or had reasonable grounds to know
of the patent. It is presumed that the infringer had known of the patent if on the patented product, or on the container or package in
which the article is supplied to the public, or on the advertising material relating to the patented product or process, are placed the
words "Philippine Patent" with the number of the patent. (Section 80)
B. TRADEMARK
1. MARKS VS COLLECTIVE MARKS VS TRADE NAMES
- "Mark" means 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;
-"Collective mark" means any visible sign designated as such in the application for registration and capable of distinguishing the
origin or any other common characteristics, including the quality of goods or services of different enterprises which use the sign under
the control of the registered owner of the collective mark;
-‘Trade name" means the name or designation identifying or distinguishing an enterprise, also known or referred to as business
identifier.
 2. ACQUISITION OF OWNERSHIP
The right to register a trademark should be based on ownership. When the applicant is not the owner of the trademark being applied
for, he has no right to apply for the registration of the same. Under the Trademark Law, only the owner of the trademark, trade name
or service mark used to distinguish his goods, business or service from the goods, business or service of others is entitled to register
the same. An exclusive distributor does not acquire any proprietary interest in the principal's trademark and cannot register it in his
own name unless it is has been validly assigned to him (Superior Commercial Enterprises, Inc. v. Kunnan Enterprises, G.R. No.
169974, April 20, 2010).

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

Registration does not confer upon the registrant an absolute right to the registered mark. The certificate of registration is merely a
prima facie proof that the registrant is the owner of the registered mark or trade name. Evidence of prior and continuous use of the
mark or trade name by another can overcome the presumptive ownership of the registrant and may very well entitle the former to be
declared owner in an appropriate case.

CONCEPT OF ACTUAL USE

Your trademark registration shall be in force for (10) years, and may be renewed indefinitely for periods of ten (10) years. However,
to maintain your trademark registration, the IP Code requires you to file a declaration and evidence of actual use, otherwise, the
protection granted to your mark will lapse. Thus, by law, you must submit a Declaration of Actual Use and proof of use (e.g., labels,
brochures, and other evidence that you are using the mark) within the following periods:
• three (3) years from the date of filing your application; and
• one (1) year from the 5th anniversary of the date of registration of your mark.

The filing of Declarations of Actual use is also needed upon renewal and mid-renewal.
Actual use of the mark in commerce is very important because if you are not using the mark in your business, your mark will be
removed from the trademarks register. To prove use of the mark, you need to submit the declarations of use within the prescribed
period.
EFFECT OF REGISTRATION
HOW CAN YOU PROTECT YOUR MARK?
In the Philippines, a trademark can be protected through registration. Registration gives the trademark owner the exclusive right to use
the mark and to prevent others from using the same or similar marks on identical or related goods and services.
The right to a trademark is granted to the one who first files a trademark application with the IP Philippines. Before applying for
trademark registration, it would help if you conduct a search in the trademarks database to determine if there are identical or similar
marks that would prevent the registration of your mark. This is to prevent future conflicts with marks that are already registered or
with earlier filing dates.
The trademark protection granted by IP Philippines protects your mark only in the Philippines. If you want your mark protected
outside the country, you will need to file applications in the countries where you want your mark registered.
3. NON- REGISTRABLE MARKS (Sec. 123.)

123.1. A mark cannot be registered if it:

(a) Consists of immoral, deceptive or scandalous matter, or matter which may disparage or falsely suggest a connection with persons,
living or dead, institutions, beliefs, or national symbols, or bring them into contempt or disrepute;
(b) Consists of the flag or coat of arms or other insignia of the Philippines or any of its political subdivisions, or of any foreign nation,
or any simulation thereof;
(c) Consists of a name, portrait or signature identifying a particular living individual except by his written consent, or the name,
signature, or portrait of a deceased President of the Philippines, during the life of his widow, if any, except by written consent of the
widow;
(d) Is identical with a registered mark belonging to a different proprietor or a mark with an earlier filing or priority date, in
respect of:
(i) The same goods or services, or
(ii) Closely related goods or services, or
(iii) If it nearly resembles such a mark as to be likely to deceive or cause confusion;
(e) Is identical with, or confusingly similar to, or constitutes a translation of a mark which is considered by the competent authority
of the Philippines to be well-known internationally and in the Philippines, whether or not it is registered here, as being already the
mark of a person other than the applicant for registration, and used for identical or similar goods or services: Provided, That in
determining whether a mark is well-known, account shall be taken of the knowledge of the relevant sector of the public, rather than of
the public at large, including knowledge in the Philippines which has been obtained as a result of the promotion of the mark;
(f) Is identical with, or confusingly similar to, or constitutes a translation of a mark considered well-known in accordance with the
preceding paragraph, which is registered in the Philippines with respect to goods or services which are not similar to those with
respect to which registration is applied for: Provided, That use of the mark in relation to those goods or services would indicate a
connection between those goods or services, and the owner of the registered mark: Provided further, That the interests of the owner of
the registered mark are likely to be damaged by such use;
(g) Is likely to mislead the public, particularly as to the nature, quality, characteristics or geographical origin of the goods or services;
(h) Consists exclusively of signs that are generic for the goods or services that they seek to identify;

(i) Consists exclusively of signs or of indications that have become customary or usual to designate the goods or services in everyday
language or in bona fide and established trade practice;
(j) Consists exclusively of signs or of indications that may serve in trade to designate the kind, quality, quantity, intended purpose,
value, geographical origin, time or production of the goods or rendering of the services, or other characteristics of the goods or
services;
(k) Consists of shapes that may be necessitated by technical factors or by the nature of the goods themselves or factors that affect their
intrinsic value;
(l) Consists of color alone, unless defined by a given form; or
(m) Is contrary to public order or morality.
123.2. As regards signs or devices mentioned in paragraphs (j), (k), and (l), nothing shall prevent the registration of any such sign or
device which has become distinctive in relation to the goods for which registration is requested as a result of the use that have been
made of it in commerce in the Philippines. The Office may accept as prima facie evidence that the mark has become distinctive, as
used in connection with the applicant’s goods or services in commerce, proof of substantially exclusive and continuous use thereof by
the applicant in commerce in the Philippines for five (5) years before the date on which the claim of distinctiveness is made.
123.3. The nature of the goods to which the mark is applied will not constitute an obstacle to registration.
4. WELL KNOWN MARKS-In determining a mark as well-known, the fact that the mark is neither registered nor used in the
Philippines is of no consequence.
(e) Is identical with, or confusingly similar to, or constitutes a translation of a mark which is considered by the competent authority of
the Philippines to be well-known internationally and in the Philippines, whether or not it is registered here, as being already the mark
of a person other than the applicant for registration, and used for identical or similar goods or services: Provided, That in determining
whether a mark is well-known, account shall be taken of the knowledge of the relevant sector of the public, rather than of the public at
large, including knowledge in the Philippines which has been obtained as a result of the promotion of the mark;
(f) Is identical with, or confusingly similar to, or constitutes a translation of a mark considered well-known in accordance with the
preceding paragraph, which is registered in the Philippines with respect to goods or services which are not similar to those with
respect to which registration is applied for: Provided, That use of the mark in relation to those goods or services would indicate a
connection between those goods or services, and the owner of the registered mark: Provided further,  That the interests of the owner of
the registered mark are likely to be damaged by such use;
5. Sec. 131. Priority Right. -
131.1. An application for registration of a mark filed in the Philippines by a person referred to in Section 3, and who previously duly
filed an application for registration of the same mark in one of those countries, shall be considered as filed as of the day the
application was first filed in the foreign country.
131.2. No registration of a mark in the Philippines by a person described in this section shall be granted until such mark has been
registered in the country of origin of the applicant.
131.3. Nothing in this section shall entitle the owner of a registration granted under this section to sue for acts committed prior to the
date on which his mark was registered in this country: Provided, That, notwithstanding the foregoing, the owner of a well-known
mark as defined in Section 123.1(e) of this Act, that is not registered in the Philippines, may, against an identical or confusingly
similar mark, oppose its registration, or petition the cancellation of its registration or sue for unfair competition, without prejudice to
availing himself of other remedies provided for under the law.
131.4. In like manner and subject to the same conditions and requirements, the right provided in this section may be based upon a
subsequent regularly filed application in the same foreign country: Provided, That any foreign application filed prior to such
subsequent application has been withdrawn, abandoned, or otherwise disposed of, without having been laid open to public inspection
and without leaving any rights outstanding, and has not served, nor thereafter shall serve, as a basis for claiming a right of priority.
Brief:
An application for registration of a mark filed in the Philippines by a person referred to in Section 3 of the IP Code, and who
previously duly filed an application for registration of the same mark in one of those countries, shall be considered as filed as of the
day the application was first filed in the foreign country. No registration of a mark shall be granted until such mark has been registered
in the country of origin of the applicant. (Sec. 131, IPC)

The owner of a mark seeking priority right is not entitled to sue for acts committed prior to the date on which his mark was registered
in the Philippines: except in the case of an owner of a well-known mark.

6. RIGHTS CONFERRED BY REGISTRATION

The owner of a registered mark shall have the exclusive right to:

a. Use the mark for one’s own goods or services;

b. Prevent third parties from using, without his consent, signs or containers which are identical or similar to the registered
trademark where such use would result in a likelihood of
confusion.

In case of the use of an identical sign for identical goods or services, a likelihood of confusion shal be presumed. (IPC, Secs. 147,
147.1)

Certificate of registration prima facie evidence of validity

A certificate of registration of a mark shall be prima facie evidence of the validity of the registration, the registrant’s ownership of the
mark, and of the registrant’s exclusive right to use the same in connection with the goods or services and those that are related thereto
specified in the certificate (IPC, Sec. 138).
Issuance and publication of certificate

The certificate of registration shall be issued when the period for filing the opposition has expired, or when the Director of Legal
Affairs shall have denied the opposition, and upon payment of the required fee (IPC, Sec. 136).

The registered mark shall be published, in the form and within the period fixed by the Regulations. Marks registered at the Office may
be inspected free of charge and any person may obtain copies thereof at his own expense. This provision shall also be applicable to
transactions recorded in respect of any registered mark (IPC, Sec. 138).

Duration of a certificate of trademark registration

A certificate of registration shall remain in force for ten (10) years, provided that the registrant shall file a declaration of actual use and
evidence to that effect, or shall show valid reasons based on the existence of obstacles to such use, as prescribed by the Regulations,
within one (1) year from the fifth anniversary of the date of the registration of the mark. Otherwise, the mark shall be removed from
the Register by the Office. (IPC, Sec. 145)

The applicant or the registrant shall file a declaration of actual use of the mark with evidence to that effect, as prescribed by the
Regulations within three (3) years from the filing date of the application. Otherwise, the application shall be refused or the mark shall
be removed from the Register by the Director (IPC, Sec. 124.2).

Effect of failure to file Declaration of Actual Use

The applicant or the registrant shall file a declaration of actual use (DAU) of the mark with evidence to that effect, within three (3)
years from the filing date of the application. Otherwise, the application shall be refused or the mark shall be removed from the
Register by the Director. (IPC, Sec. 124.2)

A fifth anniversary use is also required. This is done by filing a declaration of actual use and evidence to that effect within one year
from the fifth anniversary of the registration. The form and evidence of use required are similar to the third year DAU. Failure to
submit the fifth anniversary use and evidence to that effect shall merit the cancellation of the mark.

Renewal of registration

A certificate of registration may be renewed for periods of ten (10) years at its expiration. Each request for renewal of registration
must be made within 6 months before the expiration of the registration or within 6 months after such expiration on payment of the
additional fee prescribed. (IPC, Sec. 146)
Rights of a registered mark owner

Except in cases of importation of drugs and medicines allowed under Section 72.1 of the IP Code and of off- patent drugs and
medicines, the owner of a registered mark shall have the exclusive right to prevent all third parties not having the owner’s consent
from using in the course of trade identical or similar signs or containers for goods or services

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

There shall be no infringement of trademarks or trade names of imported or sold patented drugs and medicines allowed under Section
72.1 of the IP Code, as well as imported or sold off-patent drugs and medicines; Provided, That said drugs and medicines bear the
registered marks that have not been tampered, unlawfully modified, or infringed upon, under Section 155 of the IP Code. (Sec. 147,
IPC)

6. CANCELLATION OF REGISTRATION
A: A trademark registration may be cancelled by any person who believes that he will be damaged by the registration of the mark:

1. Within 5 years, from the date of the registration of the mark; or

2. At any time;
a. If the registered mark becomes the generic name for the goods or services, or a portion thereof, for which it is registered;
b. If the mark has been abandoned;
c. If its registration was obtained fraudulently
or contrary to the provisions of the IPC;
d. If the registered mark is being used by, or with the permission of, the registrant so as to misrepresent the source of the goods or
services on or in connection with which the
mark is used;
e. Non-use of the mark within the Philippines, without legitimate reason, for an uninterrupted period of 3 years.
NOTE: If in a petition for cancellation of a trademark, it was established that the petitioner was not its owner, prior registration can be
cancelled without need of filing a separate petition (E.Y. Industrial Sales, Inc. v. Shen Dar Electricity and Machinery Co. Ltd., G.R.
No. 184850, October 20, 2010).

8. TRADEMARK INFRINGEMENT
Use without consent of the trademark owner of any reproduction, counterfeit, copy or colorable limitation of any registered mark or
trade name. Such use is likely to cause confusion or mistake or to deceive purchasers or others as to the source or origin of such goods
or services, or Identity of such business. (Esso Standard Eastern v. CA, supra)

9. UNFAIR COMPETITION
Employing deception or any other means contrary to good faith by which a person passes off his goods or business or services for
those of one who has already established goodwill thereto. (IPC, Sec. 168.2)

It is the passing off (or palming off) or attempting to pass off upon the public of the goods or business of one person as the goods or
business of another with the end and probable effect of deceiving the public. Passing off (or palming off) takes place where the
defendant, by imitative devices on the general appearance of the goods, misleads prospective purchasers into buying his merchandise
under the impression that they are buying that of his competitors. Thus, the defendant gives his goods the general appearance of the
goods of his competitor with the intention of deceiving the public that the goods are those of his competitor. (Republic Gas
Corporation v. Petron Corporation, G. R. No. 194062, June 17, 2013)

INFRINGEMENT OF UNFAIR COMPETITION

TRADEMARK
The passing off of one’s goods as
Unauthorized use of a trademark. those of another.

Fraudulent intent is unnecessary. Fraudulent intent is essential.

Registration is necessary. Registration is not necessary.

GR: Prior registration of the trademark is a prerequisite to the action.

XPN: Well-known marks

Registration is not necessary. (Del Monte Corp. v. CA, G.R. No. 78325, January 23, 1990)

Q: In what way is an infringement of a trademark similar to that which pertains to unfair competition? (2003 Bar)
A: The similarity lies in both their ability to disrupt fair competition amongst business enterprises and other businesses. They can also
create confusion, mistake, and deception as to the minds of the consumers with regard to the source or identity of their products or
services due to its similarity in appearance or packaging.

COPYRIGHTS
A right over literary and artistic works which are original intellectual creations in the literary and artistic domain protected from the
moment of creation (IPC, Sec. 171.1).

1. COPYRIGHTABLE WORKS
1. Literary and Artistic Works
a. Books, pamphlets, articles and other writings

b. Lectures, sermons, addresses, dissertations prepared for Oral delivery, whether or not reduced in writing or other material form
c. Letters
d. Dramatic, choreographic works
e. Musical compositions
f. Works of Art
g. Periodicals and Newspapers
h. Works relative to Geography, topography, architecture or science
i. Works of Applied art
j. Works of a Scientific or technical character
k. Photographic works
l. Audiovisual works and cinematographic works
m. Pictorial illustrations and advertisements
n. Computer programs; and
o. Other literary, scholarly, scientific and artistic works (IPC, Sec. 172.1).

2. Derivative Works
a. Dramatizations, translations, adaptations, abridgements, arrangements, and other alterations of literary or artistic works;
b. Collections of literary, scholarly, or artistic works and compilations of data and other materials which are original by reason of
the selection or coordination or arrangement of their contents (IPC, Sec. 173).
 2.  NON-COPYRIGHTABLE WORKS
Non-copyrightable works

1. Idea, procedure, system, method or operation, concept, principle, discovery or mere data as such
2. News of the day and other items of press information
3. Any official text of a legislative, administrative or legal nature, as well as any official translation thereof
4. Pleadings
5. Decisions of courts and tribunals – this refers to
original decisions and not to annotated decisions such as the SCRA or SCAD as these already fall under the classification of derivative
works, hence copyrightable
6. Any work of the government of the Philippines

GR: Conditions imposed prior the approval of the government agency or office wherein the work is created shall be necessary for
exploitation of such work for profit. Such agency or office, may, among other things, impose as condition the payment of royalties.

XPN: No prior approval or conditions shall be required for the use of any purpose of statutes, rules and regulations, and speeches,
lectures, sermons, addresses, and dissertations, pronounced, read, or rendered in courts of justice, before administration agencies, in
deliberative assemblies and in meetings of public character (IPC, Sec. 176).

7. TV programs, format of TV programs (Joaquin v. Drilon, G.R. No. 108946, Jan. 28, 1999)
8. Systems of bookkeeping; and
9. Statutes.

3. RIGHTS CONFERRED BY REGISTRATION

The author of a work has copy or economic rights, as well as moral rights over the work.
 
The author has the exclusive right to carry out, authorize or prevent the:
• Reproduction of the work or substantial portion of the work;
• Dramatization, translation, adaptation, abridgment, arrangement or other transformation of the work;
• The first public distribution of the original and each copy of the work by sale or other forms of transfer of ownership;
 • Rental of the original or a copy of an audio-visual or cinematographic work, a work embodied in a sound recording, a
computer program, a compilation of data and other materials or a musical work in graphic form, irrespective of the ownership of the
original or the copy which is the subject of the rental;
• Public display of the original or a copy of the work;
• Public performance of the work; and
• Other communication to the public of the work.
 
Moral rights confer the following on the author of a work:
• To require that the authorship of the works be attributed to him, in particular; the right that his name, as far as
practicable, be indicated in a prominent way on the copies, and in connection with the public use of his work;
• To make any alterations of his work prior to, or to withhold it from publication;
• To object to any distortion, mutilation or other modification of, or other derogatory action in relation to, his work which
would be prejudicial to his honor or reputation; and
• To restrain the use of his name with respect to any work not of his own creation or in a distorted version of his work.

Neighboring rights

1. Performers rights
2. Producers of sound recordings
3. Broadcasting organizations

4. OWNERSHIP OF A COPYRIGHT
Original literary and artistic works

Author of the work. (IIPC, Sec. 178.1).

Joint authorship

Co-authors – in case of works of joint authorship; in the absence of agreement, their rights shall be governed by the rules on co-
ownership.
NOTE: If work of joint authorship consists of parts that can be used separately, then the author of each part shall be the original
owner of the copyright in the part that he has created (IPC, Sec. 178.2)

Audiovisual work

GR: Producer, the author of the scenario, the composer of the music, the film director, and the author of the work so adapted

XPN: Unless otherwise provided in an agreement, the producers shall exercise the copyright to an extent required for the exhibition of
the work in any manner, except for the right to collect performing license fees for the performance of musical compositions, with or
without words, which are incorporated into the work (IPC, Sec. 178.5)

Anonymous and pseudonymous works

The publishers shall be deemed to represent the authors of articles and other writings published without the names of the authors or
under pseudonyms, unless the contrary appears, or the pseudonyms or adopted name leaves no doubt as to the author's identity, or if
the author of the anonymous works discloses his identity (IPC, Sec. 179).

Commissioned work

The person who commissioned the work shall own the work but the copyright thereto shall remain with the creator, unless there is a
written stipulation to the contrary (IPC, Sec. 178.4).

Collective works

When an author contributes to a collective work, his right to have his contribution attributed to him is deemed waived unless he
expressly reserves it. (IPC, Sec. 196)

In the course of employment

The employee, if not a part of his regular duties even if the employee uses the time, facilities and materials of the employer.

The employer, if the work is the result of the performance of his regularly-assigned duties, unless there is an agreement, express or
implied, to the contrary. (IPC, Sec. 178.3)

Letters
In respect of letters, the copyright shall belong to the writer subject to the provisions of Article 723 of the Civil Code. (IPC, Sec.
178.6).

Civil Code of the Philippines

Article 723. Letters and other private communications in writing are owned by the person to whom they are addressed and delivered,
but they cannot be published or disseminated without the consent of the writer or his heirs. However, the court may authorize their
publication or dissemination if the public good or the interest of justice so requires.

5.LIMITATIONS ON COPYRIGHT
 
Sec. 184. Limitations on Copyright. -
184.1. Notwithstanding the provisions of Chapter V, the following acts shall not constitute infringement of copyright:
(a) the recitation or performance of a work, once it has been lawfully made accessible to the public, if done privately and free of
charge or if made strictly for a charitable or religious institution or society; (Sec. 10(1), P. D. No. 49)
(b) The making of quotations from a published work if they are compatible with fair use and only to the extent justified for the
purpose, including quotations from newspaper articles and periodicals in the form of press summaries: Provided, That the source and
the name of the author, if appearing on the work, are mentioned; (Sec. 11, Third Par., P. D. No. 49)
(c) The reproduction or communication to the public by mass media of articles on current political, social, economic, scientific or
religious topic, lectures, addresses and other works of the same nature, which are delivered in public if such use is for information
purposes and has not been expressly reserved: Provided, That the source is clearly indicated; (Sec. 11, P. D. No. 49)
(d) The reproduction and communication to the public of literary, scientific or artistic works as part of reports of current events by
means of photography, cinematography or broadcasting to the extent necessary for the purpose; (Sec. 12, P. D. No. 49)
(e) The inclusion of a work in a publication, broadcast, or other communication to the public, sound recording or film, if such
inclusion is made by way of illustration for teaching purposes and is compatible with fair use: Provided, That the source and of the
name of the author, if appearing in the work, are mentioned;
(f) The recording made in schools, universities, or educational institutions of a work included in a broadcast for the use of such
schools, universities or educational institutions: Provided, That such recording must be deleted within a reasonable period after they
were first broadcast: Provided, further, That such recording may not be made from audiovisual works which are part of the general
cinema repertoire of feature films except for brief excerpts of the work;
(g) The making of ephemeral recordings by a broadcasting organization by means of its own facilities and for use in its own broadcast;
(h) The use made of a work by or under the direction or control of the Government, by the National Library or by educational,
scientific or professional institutions where such use is in the public interest and is compatible with fair use;
(i) The public performance or the communication to the public of a work, in a place where no admission fee is charged in respect of
such public performance or communication, by a club or institution for charitable or educational purpose only, whose aim is not profit
making, subject to such other limitations as may be provided in the Regulations; (n)
(j) Public display of the original or a copy of the work not made by means of a film, slide, television image or otherwise on screen or
by means of any other device or process: Provided, That either the work has been published, or, that original or the copy displayed has
been sold, given away or otherwise transferred to another person by the author or his successor in title; and
(k) Any use made of a work for the purpose of any judicial proceedings or for the giving of professional advice by a legal practitioner.
184.2. The provisions of this section shall be interpreted in such a way as to allow the work to be used in a manner which does not
conflict with the normal exploitation of the work and does not unreasonably prejudice the right holder's legitimate interest.
6.DOCTRINE OF FAIR USE
Sec. 185. Fair Use of a Copyrighted Work.  -
185.1. The fair use of a copyrighted work for criticism, comment, news reporting, teaching including multiple copies for
classroom use, scholarship, research, and similar purposes is not an infringement of copyright. Decompilation, which is
understood here to be the reproduction of the code and translation of the forms of the computer program to achieve the inter-
operability of an independently created computer program with other programs may also constitute fair use. In determining
whether the use made of a work in any particular case is fair use, the factors to be considered shall include:
(a) The purpose and character of the use, including whether such use is of a commercial nature or is for non-profit education
purposes;
(b) The nature of the copyrighted work;
(c) The amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(d) The effect of the use upon the potential market for or value of the copyrighted work.
185.2 The fact that a work is unpublished shall not by itself bar a finding of fair use if such finding is made upon consideration
of all the above factors.
Doctrine of Fair Use
“Fair use” permits a secondary use that “serves the copyright objective of stimulating productive thought and public instruction
without excessively diminishing the incentives for creativity”.

The fair use of a copyrighted work for criticism, comment, news reporting, teaching including limited number of copies for classroom
use, scholarship, research, and similar purposes is not an infringement of copyright.

7.COPYRIGHT INFRINGEMNENT
Under Philippine law, copyright infringement occurs when there is a violation of any of the exclusive economic or moral rights
granted to the copyright owner. It may also consist in aiding or abetting such infringement. The IP Code also provides for the liability
of a person who at the time when copyright subsists in a work has in his possession an article which he knows, or ought to know, to be
an infringing copy of the work for the following purposes: (a) selling or letting for hire, or by way of trade offering or exposing for
sale or hire, the article; (b) distributing the article for the purpose of trade, or for any other purpose to an extent that will prejudice the
rights of the copyright owner in the work; or (c) trade exhibit of the article in public.
The unauthorized use of copyrighted material in a manner that violates one of the copyright owner’s exclusive rights, such as the right
to reproduce or perform the copyrighted work, or to make derivative works that build upon it

Copyright Infringement
It is the doing by any person, without the consent of the owner of the copyright, of anything the sole right to do which is conferred by
statute on the owner of the copyright. The act of lifting from another’s book substantial portions of discussions and examples and the
failure to acknowledge the same is an infringement of copyright.

 Trademark Dilution
It is the lessening of the capacity of a famous mark to identify and distinguish goods or services, regardless of the presence or absence
of (1) competition between the owner of the famous mark and other parties; or (2) likelihood of confusion, mistake or deception.
Subject to the principles of equity, the owner of a famous mark is entitled to an injunction against another person’s commercial use in
commerce of a mark or trade name, if such use begins after the mark has become famous and causes dilution of the distinctive quality
of the mark (Levi Strauss & Co., vs. Clinton Apparelle, Inc., G.R. No. 138900, September 20, 2005).

Note: The Intellectual Property Code does NOT expressly provide protection against trademark dilution. Nonetheless, its concept is
very much present in the protection of Internationally well-known marks

McDonald’s claimed to have suffered and continue to suffer actual damages in the form of injury to their business reputation and
goodwill and of the dilution of the distinctive quality of the McDonald’s marks, in particular, the mark “Big Mac” (McDonald’s Corp
v. L.C. Big Man Burger, Inc., supra).

Trademark infringement

The use without consent of the trademark owner of any a) reproduction, b) counterfeit, c) copy or d) colorable imitation of any
registered mark or tradename in connection with the sale, offering for sale, or advertising of any goods, business or services on or in
connection with which such use is likely to cause confusion or mistake or to deceive purchasers or others as to the source or origin of
such goods or services, or identity of such business; or reproduce, counterfeit, copy or colorably imitate any such mark or tradename
and apply such reproduction, counterfeit, copy or colorable limitation to labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used upon or in connection with such goods, business or services (Esso Standard Eastern v. CA, G.R.
No. L‐29971, Aug. 31, 1982)

Use without consent of the trademark owner of any reproduction, counterfeit, copy or colorable limitation of any registered mark or
trade name. Such use is likely to cause confusion or mistake

or to deceive purchasers or others as to the source or origin of such goods or services, or Identity of such business. (Esso Standard
Eastern v. CA, supra)

A crucial issue in any trademark infringement case is the likelihood of confusion, mistake or deceit as to the identity, source or origin
of the goods or identity of the business as a consequence of using a certain mark. Likelihood of confusion is admittedly a relative
term, to be determined rigidly according to the particular (and some- times peculiar) circumstances of each case. Thus, in trademark
cases, more than in other kinds of litigation, precedents must be studied in the light of each particular case. (Mighty Corporation vs. E.
J. Gallo Winery, G.R. No. 154342, 14 July 2004)
Failure to present proof of actual confusion does not negate their claim of trademark infringement. Trademark infringement requires
the less stringent standard of “likelihood of confusion” only. While proof of actual confusion is the best evidence of infringement, its
absence is inconsequential. (McDonalds Corporation v. L. C. Big Mak Burger, Inc., G.R. No. 143993, August 18, 2004)

CLOSELY-RELATED PRODUCTS

WELL-KNOWN MARKS

It refers to a mark considered well-known by the competent authority of the country where protection for the mark is sought

The scope of protection initially afforded by Article 6bis of the Paris Convention has been expanded via a nonbinding
recommendation that a well-known mark should be protected in a country even if the mark is neither registered nor used in that
country (Sehwani, Incorporated vs. In-N-Out Burger, Inc., G. R. No. 171053, October 15, 2007).

A junior user of a well-known mark on goods or services which are not similar to the goods or services, and are therefore unrelated, to
those specified in the certificate of registration of the well- known mark is precluded from using the same on the entirely unrelated
goods or services, subject to the following requisites, to wit:

1. The mark is well-known internationally and in the Philippines

2. The use of the well-known mark on the entirely unrelated goods or services would result to the likelihood of confusion of
origin or business or some business connection or relationship between the registrant and the user of the mark;

3. The interests of the owner of the well-known mark are likely to be damaged (246 Corporation, doing business under the name
and style of Rolex Music Lounge v. Hon. Reynaldo B. Daway, in his capacity as Presiding Judge of RTC Branch 90, Quezon City,
G.R. No. 157216, November 20, 2003).

Patentable Inventions. - Any technical solution of a problem in any field of human activity which is new, involves an inventive step
and is industrially applicable shall be patentable. It may be, or may relate to, a product, or process, or an improvement of any of the
foregoing.
Sec. 23. Novelty. - An invention shall not be considered new if it forms part of a prior art. (Sec. 9, R. A. No. 165a)
Sec. 24. Prior Art. - Prior art shall consist of:
 24.1. Everything which has been made available to the public anywhere in the world, before the filing date or the priority date
of the application claiming the invention; and
24.2. The whole contents of an application for a patent, utility model, or industrial design registration, published in accordance
with this Act, filed or effective in the Philippines, with a filing or priority date that is earlier than the filing or priority date of
the application: Provided, That the application which has validly claimed the filing date of an earlier application under Section
31 of this Act, shall be prior art with effect as of the filing date of such earlier application: Provided further, That the applicant
or the inventor identified in both applications are not one and the same. (Sec. 9, R. A. No. 165a)
Sec. 26. Inventive Step. - An invention involves an inventive step if, having regard to prior art, it is not obvious to a person skilled in
the art at the time of the filing date or priority date of the application claiming the invention. (n)
Sec. 27. Industrial Applicability. - An invention that can be produced and used in any industry shall be industrially applicable. (n)
Copyright

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

Trademark

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. (RA 8293, Sec.

Pearl & Dean (Phil.) Inc. v. Shoemart, Inc., G.R. No. 148222, August 15, 2003

Pearl and Dean (Phil.), Inc. (PDI) is engaged in the manufacture of advertising display units simply referred to as light boxes. PDI was able to
secure a Certificate of Copyright Registration, the advertising light boxes were marketed under the trademark “Poster Ads”.
In 1985, PDI negotiated with defendant-appellant Shoemart, Inc. (SMI) for the lease and installation of the light boxes in certain SM Makati and
SM Cubao. PDI submitted for signature the contracts covering both stores, but only the contract for SM Makati, however, was returned signed.
Eventually, SMI’s informed PDI that it was rescinding the contract for SM Makati due to non-performance of the terms thereof.

Years later, PDI found out that exact copies of its light boxes were installed at different SM stores. It was further discovered that SMI’s sister
company North Edsa Marketing Inc. (NEMI), sells advertising space in lighted display units located in SMI’s different branches.

PDI sent a letter to both SMI and NEMI enjoining them to cease using the subject light boxes, remove the same from SMI’s establishments and to
discontinue the use of the trademark “Poster Ads,” as well as the payment of compensatory damages.

Claiming that both SMI and NEMI failed to meet all its demands, PDI filed this instant case for infringement of trademark and copyright, unfair
competition and damages.

SMI maintained that it independently developed its poster panels using commonly known techniques and available technology, without notice of
or reference to PDI’s copyright. SMI noted that the registration of the mark “Poster Ads” was only for stationeries such as letterheads, envelopes,
and the like. Besides, according to SMI, the word “Poster Ads” is a generic term which cannot be appropriated as a trademark, and, as such,
registration of such mark is invalid. 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 PDI’s Certification of Copyright Registration, and Certificate of Trademark Registration.

The RTC of Makati City decided in favour of PDI, finding SMI and NEMI jointly and severally liable for infringement of copyright and
infringement of trademark

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

ISSUES:

Whether the the light box depicted in such engineering drawings ipso facto also protected by such copyright.

Whether there was a patent infringement.

Whether 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

The Court of Appeals correctly held that the copyright was limited to the drawings alone and not to the light box itself.

Although petitioner’s 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. Accordingly, it can cover only the works falling within the statutory
enumeration or description.

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 light box was not a literary or artistic
piece which could be copyrighted under the copyright law.

The Court reiterated the ruling in the case of Kho vs. Court of Appeals, differentiating patents, copyrights and trademarks, namely:

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

Petitioner never secured a patent for the light boxes. It therefore acquired no patent rights which and could not legally prevent anyone from
manufacturing or commercially using the contraption. 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.

ON THE ISSUE OF TRADEMARK INFRINGEMENT

On the issue of trademark infringement, the petitioner’s president said “Poster Ads” was a contraction of “poster advertising.” P & D was able to
secure a trademark certificate for it, but one where the goods specified were “stationeries such as letterheads, envelopes, calling cards and
newsletters.”Petitioner admitted it did not commercially engage in or market these goods. On the contrary, it dealt in electrically operated backlit
advertising units which, however, were not at all specified in the trademark certificate.
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

There was no evidence that P & D’s use of “Poster Ads” was distinctive or well-known. As noted by the Court of Appeals, petitioner’s 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.”This crucial admission 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.

“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 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.