YASAY NOTES – INTELLECTUAL PROPERTY LAW

STATE POLICY
The State recognizes that an effective intellectual and industrial property system is: (DTIM)
(1) vital to the development of domestic and creative activity;
(2) facilitates transfers of technology;
(3) attracts foreign investments; and
(4) insures market access for our products.

The State shall protect and secure the EXCLUSIVE RIGHTS of scientists, inventors, artists, and other
gifted citizens to their intellectual property and creations, particularly when beneficial to the
people, for such period as may be provided by law.

INTELLECTUAL PROPERTY CONSISTS OF:

- Copyright and related rights
- Trademarks and Service Marks
- Patents
- Geographic Indications
- Layout Designs of Integrated Circuits
- Protection of Undisclosed Information
- Industrial Designs

Geographic Indications
- indications which identify a good as originating in the territory or a region or locality in that
territory, where a given QUALITY, REPUTATION OR OTHER CHARACTERISTICS of the good
is ESSENTIALLY ATTRIBUTABLE to its geographical origin

Protection of Undisclosed Information, requisites:

1. Not generally known among or readily accessible to PERSONS WITHIN THE CIRCLES than
normally deal with the kind of information
2. HAS COMMERCIAL VALUE BECAUSE IT IS SECRET
3. Has been subject to reasonable STEPS TO KEEP IT SECRET

Trademark
- any visible sign capable of DISTINGUISHING the goods (trademark) or services (service
mark) of an enterprise
- shall include a STAMPED OR MARKED CONTAINER of goods
o Trade name
 Name or designation identifying or distinguishing an enterprise

Copyright
- literary and artistic work which are ORIGINAL intellectual creations in the LITERARY AND
ARTISTIC domain protected from the moment of creation

Patentable inventions
- any technical solution of a problem in any field of human activity which is:
o NEW
o Involves an INVENTIVE STEP; and
o INDUSTRIALLY APPLICABLE.

Industrial design
- any composition of lines or colors or any three-dimensional form

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PRINCIPLE OF RECIPROCITY
Any person who is a:
- National, or
- Domiciled, or
- Has a real and effective industrial establishment in
A country which is:
a. a PARTY to any convention, treaty or agreement relating to IP rights, or
b. extends RECIPROCAL RIGHTS TO NATIONALS OF THE PHILIPPINES
shall be ENTITLED TO BENEFITS of conventions, treaties and agreements relating to IP rights.

NATIONAL TREATMENT PRINCIPLE

- Each member of the WTO’s Agreement on TRADE-RELATED ASPECTS OF IP RIGHTS
(TRIPS) shall:
o Accord to NATIONALS OF THE OTHER MEMBERS no less favorable than that it
accords it own nationals with regard to the protection of intellectual property.

INTELLECTUAL PROPERTY OFFICE

Functions:
(1) Administratively adjudicate contested proceedings affecting IP rights
(2) Examine applications for:
a. grant of letters patent, and
b. registration of marks, geographic indications and integrated circuits
(3) Register technology transfer arrangements

The IPO exercises ORIGINAL JURISDICTION over disputes relating to the terms of a license
involving the author’s rights.

The IPO has now ENFORCEMENT FUNCTIONS and VISITORIAL POWERS.

COPYRIGHT
Collective work
- work which has been CREATED BY 2 OR MORE NATURAL PERSONS
- at the INITIATIVE and under the DIRECTION OF ANOTHER with the understanding that:
o it will be disclosed by the latter UNDER HIS OWN NAME and
o the CONTRIBUTING NATURAL PERSONS WILL NOT BE IDENTIFIED.

Joint work
- work prepared by TWO OR MORE AUTHORS with the intention that
- THEIR CONTRIBUTIONS BE MERGED into inseparable or interdependent parts of a
UNITARY WHOLE
- In the absence of agreement, their rights shall be governed by RULES ON CO-OWNERSHIP
o EXCEPT: When joint work consists of parts that can be used separately and the
author of each part can be identified

Letters and other private communications in writing

- 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

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Commissioned work
- the person commissioning owns the work
- OWNERSHIP OF COPYRIGHT REMAINS WITH THE AUTHOR
o Unless there is a written stipulation to the contrary.

Pseudonymous and anonymous works

- PUBLISHER shall be presumed to be the representative of the author
o Unless the author is undisputably known

Employee’s work during course of employment

- Owned by the EMPLOYER if the result of regular functions
- EMPLOYEE if it is not part of his duties

There must at least be SOME VERIFIABLE EXPRESSION of the intellectual product for it
to succeed in invoking copyright protection.

There is therefore CREATION when an IDEA IS EXPRESS in some TANGIBLE MEDIUM, or

is at least EXPRESSED in such a way that the critical transition from BARE IDEA OR
CONCEPT TO PRODUCT is effected.

UNPROTECTED WORKS (INOG)

1. Any idea, procedure, system, principle or discovery, even if they are expressed, explained,
illustrated or embodied in a work (e.g. format of a TV show)
2. News (mere items of press information)
3. Any OFFICIAL TEXT of a legislative, administrative or legal nature
a. Includes any official translation thereof
4. Any work of the Government of the Philippines
a. HOWEVER, prior approval of the government agency or office wherein the work is
created shall be necessary for exploitation of such work for profit
5. Trade name and container (proper subject of trademark)

ECONOMIC RIGHTS OF AUTHORS

The EXCLUSIVE RIGHT to (CAP)
1. carry out,
2. authorize, or
3. prevent the following acts: (R2P2DFO)
a. Reproduction
b. Rental
c. Public display
d. Public performance
e. Dramatization or other transformation
f. First public distribution
i. However: the moment the copyright owner has parted with the original or a
copy thereof, IT IS THE NEW OWNER that has CONTROL over subsequent
sales or transfers, BECAUSE THIS IS AN INCIDENT OF OWNERSHIP.
g. OTHER COMMUNICATION TO THE PUBLIC OF THE WORK

MORALRIGHTS (A-M-O-R-W)
1. Require that authorship be attributed to him
2. Make any ALTERATIONS of his work prior to publication

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3. Withhold it from publication

4. 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.
5. Restrain the use of his name with respect to any work NOT OF HIS OWN creation or in a
DISTORTED VERSION of his work

ACTS THAT DO NOT INFRINGE COPYRIGHT:

1. RECITATION OR PERFORMANCE OF A WORK:
a. Made accessible to the public
b. Privately done
c. Free of charge
d. Strictly for a CHARITABLE OR RELIGIOS INSTITUTION
2. MAKING OF QUOTATIONS FROM A PUBLISHED WORK:
a. Compatible with fair use
b. Extent is justified by the purpose
c. Source and name of the author, appearing on work, must be mentioned
3. SINGLE COPY REPRODUCTION of
a. A published work
b. By a natural person
c. Exclusively for RESEARCH and PRIVATE STUDY
4. FAIR USE of a copyrighted work for:
a. Criticism
b. Comment
c. News reporting
d. Teaching
i. Including MULTIPLE COPIES for classroom use, scholarship, research, and
similar purposes

Factors to consider to determine whether use is fair or not: (P-A-N-E)

1. PURPOSE and the character of the use
2. NATURE of the copyrighted work
3. AMOUNT AND SUBSTANTIALITY of the portions used
4. EFFECT of the use upon the potential market of the copyrighted work

Importation of a copyrighted work by an individual for his personal purposes is permitted.

INFRINGEMENT
When there is:
1. Piracy, or
2. Substantial reproduction
- If so much is taken that the value of the original work is substantially diminished or the
labors of the original author are substantially and to an injurious extent appropriated by
another.

Substantial reproduction does not require reproduction of the entire copyrighted work, or even a large
portion thereof.

It is not copying per se that is prohibited but the INJURIOUS EFFECT it has on the author of the
copyrighted work.

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Copyright subsists from the moment of creation. It is immaterial whether the defendant was unaware
that what he had copied was a copyrighted material.

Letters are protected works under the IP Code. The law does not distinguish if the letters are
handwritten or in electronic form.

Duration: G.R. 50 years from death, counting from January 1st of the year after his death

REMEDIES (I-D-C)
1. INJUNCTION to prevent infringement
2. Action for DAMAGES
a. Should be filed within 4 years
3. CRIMINAL CASE

MUST CARRY RULE

- requires the SATELLITE AND CABLE TV PROVIDER to carry all local stations
- A corporation that provides satellite TV service is not infringing the broadcasting and
copyright of the TV station if the satellite TV provider merely carries or simultaneously
retransmits the signals transmitted by the TV station in its UNALTERED FORM
- While the Rome Convention gives broadcasting organization the right to authorize or
prohibit rebroadcasting of its broadcast, this protection does not extent to satellite or cable
retransmission.

Copyright Infringement Plagiarism

Unauthorized use of the copyrighted material
that violates one of the copyright’s owners
exclusive economic rights
A broad term that describes a variety of acts;
any act which violates the exclusive rights of the
copyright holder
No copyright infringement of public documents
The copying must be substantial
The copying refers to the expression of an idea
The use of another’s information, language, or
writing, when done without proper
acknowledgment of the source
Specific. Refers only to using someone else’s
work without proper acknowledgement
Public documents can be plagiarized
Need not be substantial
Plagiarism may exist even if none of the same
words are used to express an idea

TRADEMARKS
1. There must be a VISIBLE SIGN.
2. It must be CAPABLE OF DISTINGUISHING the goods of an enterprise. (DISTINCTIVENESS)

COLLECTIVE MARK
- any visible sign designated as such in the application for registration and capable of
distinguishing the ORIGIN OR COMMON CHARACTERISTIC, including the quality of goods
or services of DIFFERENT ENTERPRISES which use the sign under the control of the
registered owner of the collective mark

Trade names: No need to register in order to secure protection for them

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FUNCTIONS
1. To indicate the origin of the goods to which the mark is attached
2. To guarantee the standard of quality of the goods
3. To advertise the goods

HOW MARKS ARE ACQUIRED

1. Registration
a. Necessary before one can file an action for infringement
2. Actual Use
a. Prior use in the Philippines is not required before registration
b. BUT: there must be ACTUAL USE AFTER registration
i. File a declaration of actual use within 3 years from filing of application for
registration, or
ii. Show valid reasons for non-use within 1 year from the 5th anniversary date
of registration
c. A certificate of registration is prima facie evidence of:
i. The validity of the registration
ii. Registrant’s ownership of the mark
iii. Registrant’s exclusive right to use the same
1. One who has a better right may question.

Registration is not necessary to protect goodwill.

Registration is not necessary for purposes of filing a case for UNFAIR COMPETITION or FALSE
DESIGNATION of origin.

When the law states the right is acquired from the time of registration, it refers to the FILING DATE of
application. The application is deemed filed as of the day the application was first filed in a foreign
country.

UNREGISTRABLE MARKS:
1. Identical with a registered mark belonging to a different proprietor or a mark with an
earlier filing or priority date, in respect of: (S-C-R)
a. The same goods or services
b. Closely related goods or services
c. Nearly resembles such mark as to be likely to deceive or cause confusion
2. Generic terms for goods or services
3. Descriptive marks
4. Customary sign in everyday language
5. Color by itself; and
6. Shapes

DOCTRINE OF SECONDARY MEANING

A GENERIC OR DESCRIPTIVE MARK may later acquire the characteristic of distinctiveness and
can later be registered if it acquires a meaning different from its ordinary connotation.
- There must be EXCLUSIVE AND CONTINUOUS USE for a period of at least 5 years.

ARBITRARY USE
Generic and descriptive terms may also be registered as trademarks if they are used in an arbitrary
or fanciful manner. (e.g. Ivory – soap)

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RIGHTS CONFERRED (E-P-V)

1. EXCLUSIVE USE of the mark for one’s own goods or services
2. Right to PREVENT OTHERS from the use of the same mark for identical goods or services in
the course of trade
3. Exclusive use of one’s already registered mark even for goods or services into which ONE’S
VENTURE EXPANDS, if used by others for dissimilar products is likely to damage the
business interest of the first venturer

Duration: 10 years
- subject to INDEFINITE RENEWAL for periods of 10 years each

TRADEMARK INFRINGEMENT
Elements:
1. Registered (except trade name)
2. Reproduce, counterfeited, copied or colorably imitated by the infringer
3. Used in connection with the sale, offering for sale or advertising of goods, business or
services
4. The use or application of the infringing mark or trade name is LIKELY TO CAUSE
CONFUSION OR MISTAKE or to deceive purchasers or others as to the goods or services
themselves or as to the source or origin of such goods or services or the identity of such
business; and
5. WITHOUT THE CONSENT OF THE OWNER OR ASSIGNEE

TYPES OF CONFUSION
1. Confusion of goods
2. Confusion of business

TESTS
DOMINANCY TEST
- Focuses on the SIMILARITY of the PREVALENT FEATURES of the competing trademarks
- Competing trademark contains the main, essential or dominant features of another, and
confusion or deception is LIKELY TO RESULT, infringement takes place.
- Duplication or imitation is not necessary.
- Whether the use of the marks involved is likely to cause confusion or mistake in the mind of
the public or deceive purchasers
- Embodied in the IP Code; the controlling test

HOLISTIC TEST
- Requires that the ENTIRETY of the marks in question be considered in resolving confusing
similarity
- The discerning eye of the observer must focus not only on the predominant words but also
on THE OTHER FEATURES APPEARING in both labels in order that he may draw his
conclusion whether one is confusingly similar to the other.

AURAL EFFECTS RULE (IDEM SONANS RULE)

- In dominancy test, what are taken into account are signs, color, design, peculiar shape or
name, or some special, EASILY REMEMBERED EARMARKS the brand that readily attracts
and catches the attention of the ordinary consumer.
- The aural effects of the words and letters contained should be considered.

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EXPANSION OF BUSINESS RULE

- The protection to which the owner is entitled is not limited to guarding his goods or
business from actual market competition with identical or similar products of the parties.
- It extends to ALL CASES which will forestall the normal potential expansion of his
business.
- The use by the junior appropriator is likely to lead to a confusion of source; consumers
would be misled that the complaining party has expanded its business

The use of identical mark does not, by itself, lead to a legal conclusion that there is trademark
infringement if they are NOT USED FOR IDENTICAL, SIMILAR OR RELATED GOODS.

USE OF CONTAINER
- The mere unauthorized use of a container bearing a registered trademark in connection
with the sale, distribution or advertising of goods or services which is likely to cause
confusion, mistake or deception among the buyers or consumers can be considered as
trademark infringement.

UNFAIR COMPETITION
Elements:
1. CONFUSING SIMILARITY in the general appearance of the goods
2. FRAUD or intent to deceive the public and defraud a competitor

TRADEMARK INFRINGEMENT UNFAIR COMPETITION

Unauthorized use of a trademark Passing off of one’s goods as those of another
and giving one’s goods the appearance of that of
another
Not necessary to establish fraudulent intent Necessary
Registration of the trademark is necessary for Registration is not necessary
the filing of an action for infringement
Broader as it includes cases that are covered not
only by the IPC but also by Article 27 of the Civil
Code

INTER PARTES CASES – contested cases filed before the IPO; in trademark, it includes:
1. OPPOSITION against the application for registration
a. Filed within 30 days after publication
b. Ground: damage against the oppositor
2. PETITION TO CANCEL REGISTRATION
a. Within 5 years from date of registration
i. Ground: confusingly similar marks
b. At any time
i. Grounds
1. Mark becomes generic (GENERICIDE POLICY)
2. Mark becomes descriptive
3. Abandonment – failure to use it for an uninterrupted period of 3
years
4. Mark is being used to MISREPRESENT the source of goods or
services
Venue of these cases: IPO

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An administrative complaint for violation of laws involving IP rights can be filed with the IPO where
the total damages claimed are not less than P200,000.

THEORY OF DILUTION
A mark cannot be registered IF:
1. It is identical with, or
2. Confusingly similar to, or
3. Constitutes a translation of
a. A mark considered well-known
b. Which is registered in the Philippines with respect to which registration is applied
for, PROVIDED
i. 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
ii. That the INTERESTS OF THE OWNER OF REGISTERED MARK ARE LIKELY
TO BE DAMAGED by such use

PATENTS
PATENTABLE INVENTIONS refer to any TECHNICAL SOLUTION OF A PROBLEM in any field of
human activity which is:
1. new
2. involves an inventive step, and
3. industrially applicable.

PRIOR ART
1. That which has been made available to the public anywhere in the world BEFORE THE
FILING DATE or the priority date of the application,
2. That which forms part of an application, whether for patent, utility model or industrial
design, effective in the Philippines, provided:
a. That the inventor and the applicant are not the same, and
b. The contents of the application are published in accordance with the requirements
of patent application rules and the filing date of prior art is earlier

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.
- In the case of drugs and medicines, no inventive step if invention results from:
o Mere discovery of a new form or new property of a known substance which does not
result in the enhance of its known efficacy
o Mere discovery of any new property or new use of known substance
o Mere use of a known process
 Unless it results in a new product that employs at least one new reactant

THREE-FOLD PURPOSES OF PATENT LAW

1. To foster and reward invention

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2. To promote disclosures of inventions to simulate further innovation and to permit the

public to practice the invention once the patent requires
3. To ensure that ideas in the public domain remain there for the free use of the public

NON-PATENTABLE:
1. Discoveries, scientific theories and mathematical method
2. Schemes, rules, and methods for performing mental acts, etc.
3. Methods for treatment of human body or animal body by surgery or therapy
4. Plant varieties or animal breeds
5. Aesthetic creations
6. Anything contrary to public order or morality

FIRST TO FILE RULE

- If two or more persons have made the invention SEPARATELY and INDEPENDENTLY of
each other, the right to the patent shall belong to WHO FIRST FILED an application for such
invention.

PREJUDICIAL DISCLOSURE
- Whatever right one has to the invention covered by the patent arises alone from the
application date. THUS: If the inventor voluntarily discloses it, such as by offering it for
sale, the world is free to copy and use it with impunity. Ideas once disclosed to the
public without the protection of a valid patent, are subject to appropriation without
significant restraint.

NON-PREJUDICIAL DISCLOSURE
- Any disclosure of the invention made WITHIN 12 MONTHS BEFORE THE FILING DATE does not
prejudice the application if the disclosure is made by:
o Inventor himself
o Patent office
 When the information of the latter office was contained in another
application filed by the inventor that should not be disclosed by the office
 It is contained in a third person’s application filed without the knowledge or
consent of the inventor and the third person obtained the information
directly from the inventor
o A third party who obtained the information directly or indirectly from the inventor

Duration: 20 years from the filing date of application

PATENT INFRINGEMENT
It is the:
1. Making, Using, Offering for sale, Selling, or Importing (U-M-O-S-I)
a. A patented product, or
b. A product obtained directly or indirectly from a patented product, or
2. The use of a patented process
Without the authorization of the patentee

Steps in determining the presence of infringement:

1. Determine if there is LITERAL INFRINGEMENT
- If one makes, uses or sells an item that contains all the elements of the patented claim

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o Exactness rule: the item that is being sold, made or used CONFORMS EXACTLY to
the patent claim of another
o Addition rule: Has all the elements of a patent claim of another PLUS OTHER
ELEMENTS
2. If there is none, apply the DOCTRINE OF EQUIVALENTS
- Same FUNCTION-WAY-RESULT (function-means-result test)
- An infringement also takes place when a device appropriates a prior invention by
incorporating its INNOVATIVE CONCEPT and although with some modification and change,
PERFORMS SUBSTANTIALLY the same function in substantially the same way to achieve
substantially the same result.

DOCTRINE OF FILE WRAPPER ESTOPPEL

- Precludes the patentee from adding that which he had to excise or to excise that which he
had to add by patent laws and procedures to the breadth of his claim.
- When the language of the patentee’s claims is clear and distinct, the patentee is bound
thereby and may not claim anything beyond them.

REMEDIES OF THE TRUE AND ACTUAL OWNER

1. Petition to cancel an invention patent, utility model registration, industrial design, etc.
2. PETITION FOR COMPULSORY LICENSING
- Compulsory license is a license issued by the Director General of the IPO to EXPLOIT A
PATENTED INVENTION without the permission of the patent holder, either by
o Manufacture, or
o through parallel importation
- Grounds:
o National emergency, extreme urgency
o Pubic interest, as determined by the appropriate government agency, so requires
o Judicial or administrative body has determined that the manner of exploitation by
the owner of the patent or his licensee is anti-competitive
o Public non-commercial use by the patentee without satisfactory reason
o Patented invention is not being worked in the Philippines on a commercial scale,
although capable of being worked, without satisfactory reason
o When the demand for the patented drugs and medicines is not being met to an
adequate extent and on reasonable terms, as determined by the DOH Secretary
- In whose favor?
o Any person who has shown his capacity to exploit the invention
- The compulsory license will only be granted after the petitioner has made EFFORTS TO
OBTAIN AUTHORIZATION FROM THE PATENT OWNER on reasonable commercial terms
and conditions but such efforts have not been successful within a reasonable period of time.
o Efforts to obtain authorization, not required:
 Where the petition seeks to remedy a practice determined after judicial or
administrative process to be anti-competitive
 National emergency or extreme urgency cases
 In cases of public non-commercial use
 Demand for the patented drugs and medicines in the Philippines are not
being met to an adequate extent

DEFENSES IN AN ACTION FOR INFRINGEMENT

1. Invalidity of the patent
2. Any of the grounds for cancellation

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a. Not new or patentable

b. 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;
c. Contrary to public order or morality
3. Prescription

RULES OF PROCEDURE FOR IP RIGHTS CASES

In what courts applicable? RTC designated as special commercial courts

The existing rules on TRO and preliminary injunction and other remedies are applicable

SCC IN THE NATIONAL CAPITAL JUDICIAL REGION WITH AUTHORITY TO ISSUE WRITS OF
SEARCH AND SEIZURE ENFORCEABLE NATIONWIDE:
1. Quezon City
2. Manila City
3. Makati City
4. Pasig City

Rules on the Issuance of the Search and Seizure Order in Civil Actions for Infringement
- Not applicable when the search warrants are not applied based on the civil action for
infringement
o Such as when it the warrant was issued in anticipation of CRIMINAL ACTIONS for
violation of the IP rights
o What is applicable is Rule 126 of the Rules of Court
- The pendency of a similar action for infringement of trademark and unfair competition
against the very person who applied for search warrant does not bar the issuance of the
warrant if it is based on probable cause.
- The claim for damages should be filed with the same court that issued the writ of search and
seizure. It is not permissible to file an action for damages in one court and then seek
assistance from police authority for the apprehension and criminal prosecution of the
defendants so that search warrants may be issued under Rule 126. This amounts to
improper seeking of a search warrant.
o The proceeding under Rule 126, a limited criminal one, does not provide for the
filing of counterclaims for damages against those who may have improperly
sought the issuance of the search warrant. Consequently, the defendant has the
right to seek damages, if the circumstances warrant, by a separate civil action for the
wrong inflicted on them by an improperly obtained search warrant.

EVIDENCE OF GOOD FAITH

- In cases of patent infringement, trademark infringement, and copyright infringement,
fraudulent intent on the part of the defendant or accused need not be established.
- GOOD FAITH IS NOT A DEFENSE, unless:
o The defendant or the accused claims to be a PRIOR user (for patent), or
o When damages may be recovered under the IP Code

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