Intellectual Property Law Reviewer

Allan Verman Ong

Intellectual Property Law: Cram Another Day

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SY 2002-2003

Intellectual Property Law RA 8293

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for the protection of creative works/intangible goods (goods that are expressions of the mind) framework: “What are they really protecting?” Tangibles

Property

Patents Industrial Property

Inventions Utility Models Industrial Designs

Trade Secrets

Intangibles Trade Marks

Creative Rights

Copyrights Neighboring Rights

Patents – grants by the State given to someone so he will have monopoly right over his property in exchange for you revealing something 1)new, 2) useful, and 3) has an inventive step, state gives you protection Utility Model – no inventive step so lesser right and protection but it is still useful Industrial Design – has an artistic/aesthetic appeal Trade Secrets – anything that will provide business with competitive advantage, e.g. list of customers of marketing company not protected under the IP Code, but governed by contracts e.g. employee contracts Trademarks – don’t protect innovation, protects goodwill specific mark on goods – trademarks, servicemarks, certification marks, geographic indicators, trade names, trade dress even if not registered, as long as there is goodwill, you can sue a “business identification system” before Jan. 1, 1998, RP used first to use system (whoever uses first has the trademark) with an exception to internationally known marks (e.g. Lacoste case) now, RP is a first to file jurisdiction Q. Before Jan. 1, 1998, an RP company registered Lacoste trademark, used it. It was first to use. Lacoste filed trademark infringement suit. It was proven that the brand was already known in RP by people who had travelled to Europe. Since RP is first to use jurisdiction, RP company has trademark? A. No. Falls under internationally known marks exception

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Q. McDo came to RP in 1970. In 1980s, they had huge marketing campaign so they became known in RP. Big Mack was a large hamburger chain in the provinces. In 1980, McDo filed trademark infringement case. It was proven that some people actually think Big Mack is affiliated with McDo and was creating confusion. A. Big Mack wins. Trademark protects goodwill. McDo’s goodwill was established in 1980. It was proven here that Big Mack was already established in RP before McDo became known because of the mktg campaign. Q. You have carinderia, “Cooking Ina Mo”. Neighbor sets up “Cooking ng Ina Mo Rin.” Trademark infringement? A. Maybe not. It does not cause/create confusion. Creative Rights – protect unique expression of an idea 1. copyright – moral right - what is protected is unique expression of an idea. So Einstein’s e=mc2 is not protected, but the dissertation where he explained the idea is protected. 2. neighboring rights – performer’s rights what is protected is not idea but distinct/unique expression Technology Transfer Agreements – e.g. licensing. Aside from patents, copyrights, there are other means of protecting property in other nations Q. Do intangibles have to be registered to enjoy protection? A. Generally, industrial property must be registered. No need to register in creative rights – the moment you create it, it’s yours. Registration of books in the National Library is only proof of copyright US – computer programs are protected by patents. In RP, only copyright. International Treaties Protecting Copyrights 1. Berne Convention – for protection of literary works, established in Aug. 1, 1951. Core Principles: 1. national treatment – nationals from different states should have protection of their own works 2. principle of automatic protection – no need to register copyrights 3. principle of independence of protection – treat foreigners the way you protect nationals 2.

TRIPS Agreement – Trade Related Aspects of IP Rights, a sub-agreement of the GATT, Principles: 1. Establishment of minimum standards of protection as to enforcement of IPR transnationally 2. National treatment – of the IP owner 3. Most favored nation principle – treat all signatories similarly, no special treatment should be given to any nation

Q. When can you not invoke copyright? A. When there is: 1. Conflict with normal exploitation of work 2. When it prejudices the right of legitimate owner of right of work Issues: copyright protection like Mickey Mouse are gradually entering public domain (since copyright lasts until 50 years after the death of creator) so there are moves to extend the term protection but Shakespeare works are public domain – so is extending term a good thing? US passed the Sonny Bono copyright extension act 3.

WIPO Copyright Treaty - ratified Feb. 2002, protecting rights of authors in new technologies

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new technologies include internet and digital works now, temporary copies are protected (temporary – something you download from internet) new rights are created: 1. right to distribution 2. rental right – right of author to rent out cinematic works, phonograms, computer programs - you can’t rent out your copy of Windows 2002 CD. But if your Palm Pilot breaks down and you rent a Palm with Windows, it’s okay, since computer program isn’t the “thing of rent” 3. right of communication to public – wire/wireless means

Principles: 1. circumvention of technology measures – e.g. DVD contents handling system 2. concealment of infringement – search and seizure is given in civil cases before, state files for search warrant, now, since civil case, private party can file for search warrant and get injunction 3. protection is granted from the time of creation NOTE: WIPO treaty is already ratified but still need enabling legislation, either in the form of new law of amendment of the IP Code

PART IV THE LAW ON COPYRIGHT Copyright – is a bundle of rights e.g. JKR can sell various rights like right to publish (Scholastic), right to make a movie from her story (Warner), right to make toys from characters (e.g., Mattel) – a “negative right” since it prevents you from enjoying, deriving benefit – property protected is “intellectual” – use consists of derivative rights, e.g. reproduction, translation, dramatization Q. Database, is this protected? A. Facts alone are not protected (same for multimedia). But if you do some arrangement on the information, that is protected. Q. Creativity = Originality? A. No. In copyright, what is important is originality. As long as it is yours, it is protected. List of Ateneo Grads – public domain List of Ateneo Grades who worked in Judiciary – protected if someone else rearranges your list and does your list in alphabetical order – you can sue if there is distinction in the way the facts were selected, coordinated, arranged and presented, copyrightable Novelty – an essential element in patentability means that no one else in the world has come up with the same invention anywhere, anytime not the same with originality, although in both, you come up with a new idea if you develop it without outside influence, you can copyright. Several people can own the copyright but only one person can hold the patent SEC. 171. DEFINITIONS. - FOR THE PURPOSE OF THIS ACT, THE FOLLOWING TERMS HAVE THE FOLLOWING MEANING: 171.1. "AUTHOR" IS THE NATURAL PERSON WHO HAS CREATED THE WORK;

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171.2. A "COLLECTIVE WORK"

IS A WORK WHICH HAS BEEN CREATED BY TWO

(2)

OR MORE NATURAL PERSONS AT THE

INITIATIVE AND UNDER THE DIRECTION OF ANOTHER WITH THE UNDERSTANDING THAT IT WILL BE DISCLOSED BY THE LATTER UNDER HIS OWN NAME AND THAT CONTRIBUTING NATURAL PERSONS WILL NOT BE IDENTIFIED;

171.3. "COMMUNICATION TO THE PUBLIC"

OR

"COMMUNICATE

TO THE PUBLIC" MEANS THE MAKING OF A WORK

AVAILABLE TO THE PUBLIC BY WIRE OR WIRELESS MEANS IN SUCH A WAY THAT MEMBERS OF THE PUBLIC MAY ACCESS THESE WORKS FROM A PLACE AND TIME INDIVIDUALLY CHOSEN BY THEM;

171.4. A "COMPUTER" IS AN ELECTRONIC OR SIMILAR DEVICE HAVING INFORMATION-PROCESSING CAPABILITIES, AND A "COMPUTER PROGRAM" IS A SET OF INSTRUCTIONS EXPRESSED IN WORDS, CODES, SCHEMES OR IN ANY OTHER FORM, WHICH IS CAPABLE WHEN INCORPORATED IN A MEDIUM THAT THE COMPUTER CAN READ, OR CAUSING THE COMPUTER TO PERFORM OR ACHIEVE A PARTICULAR TASK OR RESULT; 171.5. "PUBLIC LENDING"

IS THE TRANSFER OF POSSESSION OF THE ORIGINAL OR A COPY OF A WORK OR SOUND

RECORDING FOR A LIMITED PERIOD, FOR NON-PROFIT PURPOSES, BY AN INSTITUTION THE SERVICES OF WHICH ARE

AVAILABLE TO THE PUBLIC, SUCH AS PUBLIC LIBRARY OR ARCHIVE;

171.6. "PUBLIC PERFORMANCE," IN THE CASE OF A WORK OTHER THAN AN AUDIOVISUAL WORK, IS THE RECITATION, PLAYING, DANCING, ACTING OR OTHERWISE PERFORMING THE WORK, EITHER DIRECTLY OR BY MEANS OF ANY DEVICE OR PROCESS; IN THE CASE OF AN AUDIOVISUAL WORK, THE SHOWING OF ITS IMAGES IN SEQUENCE AND THE MAKING OF THE SOUNDS ACCOMPANYING IT AUDIBLE; AND, IN THE CASE OF A SOUND RECORDING, MAKING THE RECORDED SOUNDS AUDIBLE AT A PLACE OR AT PLACES WHERE PERSONS OUTSIDE THE NORMAL CIRCLE OF A FAMILY AND THAT FAMILY’S CLOSEST SOCIAL ACQUAINTANCES ARE OR CAN BE PRESENT, IRRESPECTIVE OF WHETHER THEY ARE OR CAN BE PRESENT AT THE SAME PLACE AND AT THE SAME TIME, OR AT DIFFERENT PLACES AND/OR AT DIFFERENT TIMES, AND WHERE THE PERFORMANCE CAN BE PERCEIVED WITHOUT THE NEED FOR COMMUNICATION WITHIN THE MEANING OF SUBSECTION 171.3; 171.7. "PUBLISHED WORKS"

MEANS WORKS, WHICH, WITH THE CONSENT OF THE AUTHORS, ARE MADE AVAILABLE TO

THE PUBLIC BY WIRE OR WIRELESS MEANS IN SUCH A WAY THAT MEMBERS OF THE PUBLIC MAY ACCESS THESE WORKS FROM A PLACE AND TIME INDIVIDUALLY CHOSEN BY THEM:

PROVIDED, THAT

AVAILABILITY OF SUCH COPIES HAS BEEN

SUCH, AS TO SATISFY THE REASONABLE REQUIREMENTS OF THE PUBLIC, HAVING REGARD TO THE NATURE OF THE WORK;

171.8. "RENTAL"

IS THE TRANSFER OF THE POSSESSION OF THE ORIGINAL OR A COPY OF A WORK OR A SOUND

RECORDING FOR A LIMITED PERIOD OF TIME, FOR PROFIT-MAKING PURPOSES;

171.9. "REPRODUCTION" MANNER OR FORM;

IS THE MAKING OF ONE

(1)

OR MORE COPIES OF A WORK OR A SOUND RECORDING IN ANY

171.10. 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;

171.11. A "WORK OF THE GOVERNMENT OF THE PHILIPPINES" IS A WORK CREATED BY AN OFFICER OR EMPLOYEE OF THE PHILIPPINE GOVERNMENT OR ANY OF ITS SUBDIVISIONS AND INSTRUMENTALITIES, INCLUDING GOVERNMENT-OWNED OR CONTROLLED CORPORATIONS AS PART OF HIS REGULARLY PRESCRIBED OFFICIAL DUTIES. CHAPTER II ORIGINAL WORKS

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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: (A) BOOKS, PAMPHLETS, ARTICLES AND OTHER WRITINGS; (B) PERIODICALS AND NEWSPAPERS; (C) LECTURES, SERMONS, ADDRESSES, DISSERTATIONS PREPARED FOR ORAL DELIVERY, WHETHER OR NOT REDUCED IN WRITING OR OTHER MATERIAL FORM; (D) LETTERS; (E) DRAMATIC OR DRAMATICO-MUSICAL COMPOSITIONS; CHOREOGRAPHIC WORKS OR ENTERTAINMENT IN DUMB SHOWS; (F) MUSICAL COMPOSITIONS, WITH OR WITHOUT WORDS; (G) WORKS OF DRAWING, PAINTING, ARCHITECTURE, SCULPTURE, ENGRAVING, LITHOGRAPHY OR OTHER WORKS OF ART; MODELS OR DESIGNS FOR WORKS OF ART; (H) ORIGINAL ORNAMENTAL DESIGNS OR MODELS FOR ARTICLES OF MANUFACTURE, WHETHER OR NOT REGISTRABLE AS AN INDUSTRIAL DESIGN, AND OTHER WORKS OF APPLIED ART; (I) ILLUSTRATIONS, MAPS, PLANS, SKETCHES, CHARTS AND THREE-DIMENSIONAL WORKS RELATIVE TO GEOGRAPHY, TOPOGRAPHY, ARCHITECTURE OR SCIENCE; (J) DRAWINGS OR PLASTIC WORKS OF A SCIENTIFIC OR TECHNICAL CHARACTER; (K) PHOTOGRAPHIC WORKS INCLUDING WORKS PRODUCED BY A PROCESS ANALOGOUS TO PHOTOGRAPHY; LANTERN SLIDES; (L) AUDIOVISUAL WORKS AND CINEMATOGRAPHIC WORKS AND WORKS PRODUCED BY A PROCESS ANALOGOUS TO CINEMATOGRAPHY OR ANY PROCESS FOR MAKING AUDIO-VISUAL RECORDINGS; (M) PICTORIAL ILLUSTRATIONS AND ADVERTISEMENTS; (N) COMPUTER PROGRAMS; AND (O) OTHER LITERARY, SCHOLARLY, SCIENTIFIC AND ARTISTIC WORKS. 172.2. WORKS ARE PROTECTED BY THE SOLE FACT OF THEIR CREATION, EXPRESSION, AS WELL AS OF THEIR CONTENT, QUALITY AND PURPOSE.

IRRESPECTIVE OF THEIR MODE OR FORM OF

The thing should be “tangible” for it to come under copyright protection. (Hence, mere idea like e=mc2 is not copyrightable.) - if written, if recorded, then copyrightable. If not recorded, there is no protection because it is not in a tangible form. Q. Are functional objects copyrightable? E.g. Figurine Lamps A. Test is if thing is more artistic than functional. Here, figurine lamp is more artistic so it is copyrightable. But Magwheels would not be copyrightable because it is more functional. Cause of action is violation of a design patent. There is no need to test the gray line since there is another source of protection. Q. Since only tangible things are protected, are architectural plans copyrightable? A. Yes. This is an exception to the rule that only designs are copyrightable since architectural plans are nothing without execution. NOTE: There is a different rule with regard to design of chips, e.g. if design is obtained from reverse engineering. Only plan of chip is protected so reverse engineered chip is not an infringement of copyright. NOTE: One of the defenses to copyright infringement is absence of access. If there is no access, there is no infringement.

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CHAPTER III DERIVATIVE WORKS SEC. 173. DERIVATIVE WORKS. 173.1. THE FOLLOWING DERIVATIVE WORKS SHALL ALSO BE PROTECTED BY COPYRIGHT: (A) DRAMATIZATIONS, TRANSLATIONS, ADAPTATIONS, ABRIDGMENTS, ARRANGEMENTS, AND ALTERATIONS OF LITERARY OR ARTISTIC WORKS; AND (B) COLLECTIONS OF LITERARY, SCHOLARLY OR ARTISTIC WORKS, AND COMPILATIONS OF DATA AND

OTHER OTHER

MATERIALS WHICH ARE ORIGINAL BY REASON OF THE SELECTION OR COORDINATION OR ARRANGEMENT OF THEIR CONTENTS.

• Licensing is the means to protect derivative works. In licensing, JKR allows you to make movie. Agreement should be clear: you pay for the right to make the movie, and that is all you have if you do not stipulate on who retains copyright to the movie. Default rule is, she retains right to the movie. • Licensing also includes rights like coming up with the movie in DVD format. Q. If there is copyright violation, what kind of action will you bring – criminal, civil, administrative? A. Criminal. So that issues like standing to sue (if you are doing business in RP) and copyright ownership (whether Warner owns the copyright or JKR) will not come up since the State is the offended party. 173.2. THE WORKS REFERRED TO IN PARAGRAPHS (A) AND (B) OF SUBSECTION 173.1 SHALL BE PROTECTED AS A NEW PROVIDED HOWEVER, THAT SUCH NEW WORK SHALL NOT AFFECT THE FORCE OF ANY SUBSISTING COPYRIGHT UPON THE ORIGINAL WORKS EMPLOYED OR ANY PART THEREOF, OR BE CONSTRUED TO IMPLY ANY RIGHT TO SUCH USE OF THE ORIGINAL WORKS, OR TO SECURE OR EXTEND COPYRIGHT IN SUCH ORIGINAL WORKS.

WORKS:

SEC. 174. PUBLISHED EDITION OF WORK. - IN ADDITION TO THE RIGHT TO PUBLISH GRANTED BY THE AUTHOR, HIS HEIRS OR ASSIGNS, THE PUBLISHER SHALL HAVE A COPY RIGHT CONSISTING MERELY OF THE RIGHT OF REPRODUCTION OF THE TYPOGRAPHICAL ARRANGEMENT OF THE PUBLISHED EDITION OF THE WORK. (N) CHAPTER IV WORKS NOT PROTECTED SEC. 175. UNPROTECTED SUBJECT MATTER. - NOTWITHSTANDING THE PROVISIONS OF SECTIONS 172 AND 173, NO PROTECTION SHALL EXTEND, UNDER THIS LAW, TO: (1) ANY IDEA, PROCEDURE, SYSTEM METHOD OR OPERATION, CONCEPT, PRINCIPLE, DISCOVERY OR MERE DATA AS SUCH, EVEN IF THEY ARE EXPRESSED, EXPLAINED, ILLUSTRATED OR EMBODIED IN A WORK; (2) NEWS OF THE DAY AND OTHER MISCELLANEOUS FACTS HAVING THE CHARACTER OF MERE ITEMS OF PRESS INFORMATION; (3) OR ANY OFFICIAL TEXT OF A LEGISLATIVE, ADMINISTRATIVE OR LEGAL NATURE, AS WELL AS ANY OFFICIAL TRANSLATION THEREOF. (N) SEC. 176. WORKS OF THE GOVERNMENT. 176.1. NO COPYRIGHT SHALL SUBSIST

IN ANY WORK OF THE

GOVERNMENT

OF THE

PHILIPPINES. HOWEVER,

PRIOR

APPROVAL OF THE GOVERNMENT AGENCY OR OFFICE WHEREIN THE WORK IS CREATED SHALL BE NECESSARY FOR

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EXPLOITATION OF SUCH WORK FOR PROFIT.

SUCH

AGENCY OR OFFICE MAY, AMONG OTHER THINGS, IMPOSE AS A NO PRIOR APPROVAL OR CONDITIONS SHALL BE REQUIRED FOR THE USE OF ANY PURPOSE OF STATUTES, RULES AND REGULATIONS, AND SPEECHES, LECTURES, SERMONS, ADDRESSES, AND DISSERTATIONS, PRONOUNCED, READ OR RENDERED IN COURTS OF JUSTICE, BEFORE ADMINISTRATIVE AGENCIES, IN DELIBERATIVE ASSEMBLIES AND IN MEETINGS OF PUBLIC CHARACTER. CONDITION THE PAYMENT OF ROYALTIES.

176.2. THE AUTHOR

OF SPEECHES, LECTURES, SERMONS, ADDRESSES, AND DISSERTATIONS MENTIONED IN THE

PRECEDING PARAGRAPHS SHALL HAVE THE EXCLUSIVE RIGHT OF MAKING A COLLECTION OF HIS WORKS.

176.3. NOTWITHSTANDING THE FOREGOING PROVISIONS,

THE

GOVERNMENT IS NOT PRECLUDED FROM RECEIVING AND

HOLDING COPYRIGHTS TRANSFERRED TO IT BY ASSIGNMENT, BEQUEST OR OTHERWISE; NOR SHALL PUBLICATION OR REPUBLICATION BY THE GOVERNMENT IN A PUBLIC DOCUMENT OF ANY WORK IN WHICH COPY RIGHT IS SUBSISTING BE TAKEN TO CAUSE ANY ABRIDGMENT OR ANNULMENT OF THE COPYRIGHT OR TO AUTHORIZE ANY USE OR APPROPRIATION OF SUCH WORK WITHOUT THE CONSENT OF THE COPYRIGHT OWNERS.

CHAPTER V COPYRIGHT OR ECONOMIC RIGHTS SEC. 177. COPY OR ECONOMIC RIGHTS. - SUBJECT TO THE PROVISIONS OF CHAPTER VIII, COPYRIGHT OR ECONOMIC RIGHTS SHALL CONSIST OF THE EXCLUSIVE RIGHT TO CARRY OUT, AUTHORIZE OR PREVENT THE FOLLOWING ACTS: 177.1. REPRODUCTION OF THE WORK OR SUBSTANTIAL PORTION OF THE WORK; -

reproduction must be commercial, public and substantial “substantial” is vague; it should be a case to case basis. Factors to be considered are length copied and importance of a portion copied. You may copy only one paragraph but it could be the essence of the entire thing

177.2 DRAMATIZATION,

TRANSLATION, ADAPTATION, ABRIDGMENT, ARRANGEMENT OR OTHER TRANSFORMATION OF

THE WORK;

177.3. THE FIRST PUBLIC DISTRIBUTION OF THE ORIGINAL AND EACH COPY OF THE WORK BY SALE OR OTHER FORMS OF TRANSFER OF OWNERSHIP;

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right to determined 1) whether or not to sell, and 2) when to sell

Q. If you buy a book then after reading it, you sell it to another, infringement? A. No. The moment it is sold, copyright protection as to public distribution is over. NOTE: There is a difference between copyrighted work and the medium where it is contained. So you can sell your book, unless it is provided in the copyright agreement Quaerendum: Does this apply to digital works? Because under the first sale doctrine, you can sell your copy. First sale doctrine assumes there is a tangible thing. The “paper” suggests that the doctrine should not apply to internet. 177.4. RENTAL OF THE ORIGINAL OR A COPY OF AN AUDIOVISUAL 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;

- There should be permission (a license) to rent out for VHS stores to operate

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This has been made part of the WTO via the TRIPS agreement So if someone borrows VHS from an unlicensed store, there is also a criminal violation on his part.

177.5. PUBLIC DISPLAY OF THE ORIGINAL OR A COPY OF THE WORK; 177.6. PUBLIC PERFORMANCE OF THE WORK; AND NOTE: Public Performance was defined earlier as: 171.6. "Public performance," in the case of a work other than an audiovisual work, is the recitation,

playing, dancing, acting or otherwise performing the work, either directly or by means of any device or process; in the case of an audiovisual work, the showing of its images in sequence and the making of the sounds accompanying it audible; and, in the case of a sound recording, making the recorded sounds audible at a place or at places where persons outside the normal circle of a family and that family’s closest social acquaintances are or can be present, irrespective of whether they are or can be present at the same place and at the same time, or at different places and/or at different times, and where the performance can be perceived without the need for communication within the meaning of Subsection 171.3;

Q. No TV in barrio, you buy TV, subscribe from Home and charge people to watch it. Violation? A. Yes, It falls under public performance, same rule for broadcast. TV – -

point to multipoint point to point (since only subscriber can receive)

Q. Is there broadcast? A. Yes, there is broadcast. Public performance and communication to the public is included. There is no distinction as to TV or cable. • Website with copyrighted material – point to point, protection includes broadcast and communicating to the public so you have protection • Internet – there is assumed right to transmit material in internet unless made very clear that there are restrictions • E-Commerce Act – you can enter into internet contract by clicking “I agree” in buttons Therefore: if you click “I agree that I will not violate copyright” and still violate copyright, two causes of action against you: 1) breach of contract and 2) copyright infringement 177.7. OTHER COMMUNICATION TO THE PUBLIC OF THE WORK Q. Is copyright owner given right to prevent importation of the article? A. Parallel import – in patent, the right to limit importation is clearly given. But it is not clear in copyright law. IP Code provides in Sec. 190. the importation of a copy of a work by an individual for his personal purposes shall be permitted without the authorization of the author of, or other owner of copyright in, the work under the following circumstances: (a) When copies of the work are not available in the Philippines and: (i) Not more than one (1) copy at one time is imported for strictly individual use only; or (ii) The importation is by authority of and for the use of the Philippine Government; or (iii) The importation, consisting of not more than three (3) such copies or likenesses in any one invoice, is not for sale but for the use only of any religious, charitable, or educational society or institution duly incorporated or registered, or is for the encouragement of the fine arts, or for any state school, college, university, or free public library in the Philippines.

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CHAPTER VI OWNERSHIP OF COPYRIGHT SEC. 178. RULES ON COPYRIGHT OWNERSHIP. - COPYRIGHT OWNERSHIP SHALL BE GOVERNED BY THE FOLLOWING RULES: 178.1. SUBJECT TO THE PROVISIONS OF THIS SECTION, IN THE CASE OF ORIGINAL LITERARY AND ARTISTIC WORKS, COPYRIGHT SHALL BELONG TO THE AUTHOR OF THE WORK; 178.2. IN

THE CASE OF WORKS OF JOINT AUTHORSHIP, THE CO-AUTHORS SHALL BE THE ORIGINAL OWNERS OF THE

COPYRIGHT AND IN THE ABSENCE OF AGREEMENT, THEIR RIGHTS SHALL BE GOVERNED BY THE RULES ON CO-OWNERSHIP.

IF,

HOWEVER, A WORK OF JOINT AUTHORSHIP CONSISTS OF PARTS THAT CAN BE USED SEPARATELY AND THE AUTHOR OF

EACH PART CAN BE IDENTIFIED, THE AUTHOR OF EACH PART SHALL BE THE ORIGINAL OWNER OF THE COPYRIGHT IN THE PART THAT HE HAS CREATED;

General rule: Creator has copyright. It can be co-owned. Copyright protection lasts until 50 years after death of author. If there are two authors, it is after the second death. So include your son for the extra 30-40 years of protection. 178.3. IN

THE CASE OF WORK CREATED BY AN AUTHOR DURING AND IN THE COURSE OF HIS EMPLOYMENT, THE

COPYRIGHT SHALL BELONG TO:

(A) THE

EMPLOYEE, IF THE CREATION OF THE OBJECT OF COPYRIGHT 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 WORK IS THE RESULT OF THE PERFORMANCE OF HIS REGULARLY-ASSIGNED DUTIES,

UNLESS THERE IS AN AGREEMENT, EXPRESS OR IMPLIED, TO THE CONTRARY.

Q. Software programmer working in a company has access to information to create accounting computer programs. During his lunch break, he uses the equipment to create computer games. Is there copyright infringement? A. No. Employee has the copyright. But the ee-er contract may stipulate that employee may assign copyright. Outright ownership is not allowed as to objects created outside the scope. By requiring the assignment of the copyright, this is made a condition for getting the job from day one. If employee violates the contract, the employee can be sued for 2 causes of action – breach of contract and infringement. 178.4. IN

THE CASE OF A WORK-COMMISSIONED BY A PERSON OTHER THAN AN EMPLOYER OF THE AUTHOR AND WHO

PAYS FOR IT AND THE WORK IS MADE IN PURSUANCE OF THE COMMISSION, THE PERSON WHO SO COMMISSIONED THE WORK SHALL HAVE OWNERSHIP OF WORK, BUT THE COPYRIGHT THERETO SHALL REMAIN WITH THE CREATOR, UNLESS THERE IS A WRITTEN STIPULATION TO THE CONTRARY;

General rule: copyright remains with author. If commissioned work is photographed and published, infringement of right of painter. Contract has to be IN WRITING. If it is not in writing, artist/creator retains copyright. 178.5. IN

THE CASE OF AUDIOVISUAL WORK, THE COPYRIGHT SHALL BELONG TO THE PRODUCER, THE AUTHOR OF THE

SCENARIO, THE COMPOSER OF THE MUSIC, THE FILM DIRECTOR, AND THE AUTHOR OF THE WORK SO ADAPTED.

HOWEVER,

SUBJECT TO CONTRARY OR OTHER STIPULATIONS AMONG THE CREATORS, 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; AND

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Q. If you want to produce DVD, who do you talk to? A. The producer. But for infringement case, who has cause of action?

178.6. IN RESPECT OF LETTERS, ARTICLE 723 OF THE CIVIL CODE.

THE COPYRIGHT SHALL BELONG TO THE WRITER SUBJECT TO THE PROVISIONS OF

Art. 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. Not yet sent – copyright belongs to writer Sent – belongs to person to whom it is addressed If not received, copyright isn’t transferred.

SEC. 179. ANONYMOUS AND PSEUDONYMOUS WORKS. - FOR PURPOSES OF THIS ACT,

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 DOUBTS AS TO THE AUTHOR’S IDENTITY, OR IF THE AUTHOR OF THE ANONYMOUS WORKS DISCLOSES HIS IDENTITY.

CHAPTER VII TRANSFER OR ASSIGNMENT OF COPYRIGHT

SEC. 180. RIGHTS OF ASSIGNEE. 180.1. THE COPYRIGHT MAY BE

ASSIGNED IN WHOLE OR IN PART.

WITHIN

THE SCOPE OF THE ASSIGNMENT, THE

ASSIGNEE IS ENTITLED TO ALL THE RIGHTS AND REMEDIES WHICH THE ASSIGNOR HAD WITH RESPECT TO THE COPYRIGHT.

180.2. THE

COPYRIGHT IS NOT DEEMED ASSIGNED INTER VIVOS IN WHOLE OR IN PART UNLESS THERE IS A WRITTEN

INDICATION OF SUCH INTENTION.

180.3. THE

SUBMISSION OF A LITERARY, PHOTOGRAPHIC OR ARTISTIC WORK TO A NEWSPAPER, MAGAZINE OR

PERIODICAL FOR PUBLICATION SHALL CONSTITUTE ONLY A LICENSE TO MAKE A SINGLE PUBLICATION UNLESS A GREATER RIGHT IS EXPRESSLY GRANTED.

IF

TWO

(2)

OR MORE PERSONS JOINTLY OWN A COPYRIGHT OR ANY PART THEREOF,

NEITHER OF THE OWNERS SHALL BE ENTITLED TO GRANT LICENSES WITHOUT THE PRIOR WRITTEN CONSENT OF THE OTHER OWNER OR OWNERS.

SEC. 181. COPYRIGHT AND MATERIAL OBJECT. - THE COPYRIGHT IS DISTINCT FROM THE PROPERTY IN THE MATERIAL OBJECT CONSEQUENTLY, THE TRANSFER OR ASSIGNMENT OF THE COPYRIGHT SHALL NOT ITSELF CONSTITUTE A TRANSFER OF THE MATERIAL OBJECT. NOR SHALL A TRANSFER OR ASSIGNMENT OF THE SOLE COPY OR OF ONE OR SEVERAL COPIES OF THE WORK IMPLY TRANSFER OR ASSIGNMENT OF THE COPYRIGHT. SUBJECT TO IT.

SEC. 182. FILING OF ASSIGNMENT OF LICENSE. - AN ASSIGNMENT OR EXCLUSIVE LICENSE MAY BE FILED IN DUPLICATE WITH THE NATIONAL LIBRARY UPON PAYMENT OF THE PRESCRIBED FEE FOR REGISTRATION IN BOOKS AND RECORDS KEPT FOR THE PURPOSE. UPON RECORDING, A COPY OF THE INSTRUMENT SHALL BE, RETURNED TO THE SENDER WITH A NOTATION OF THE FACT OF RECORD. NOTICE OF THE RECORD SHALL BE PUBLISHED IN THE IPO GAZETTE. ASSIGNMENT AND LICENSE Possible defenses to infringement are:

1.) you acquired copyright already – copyright was assigned 2.) you were allowed to do the stuff you did – you have a license

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ASSIGNMENT Copyright – a body of rights so you can assign some of these rights to other people (note, only Economic Rights are assignable. Moral Rights are not assignable/alienable.) Assignment has to be in writing. NOTE: When I give a copy to a publication for publication, when there is no agreement between the parties, I retain the copyright and it extends only to one publication. • Second reprints are not allowed, without permission. License -

can be free or for a fee Trivia: A portion of costs of CD are paid to the artist as royalty.

Transfer of Ownership?

COPYRIGHT Yes

Standing to sue for infringement?

Yes. Here, you own copyright, so you can sue.

Kinds/Additional Info

• Joint ownership of copyright (e.g. two authors) – ask permission from both • Film – all (writer/producer/song writer) own the copyright. But the producer represents them

LICENSE No. This involves only permission from the author/creator. He retains ownership of the copyright. No. You can’t sue because only the copyright owner can do that. However, you can stipulate on this. Even to bring criminal actions? Yes. But usually, only licensor can sue because it is his property and he wants to control it. • Exclusive – you can license the same right to somebody else and not be in breach (for instance, Neil Gaiman licensed movie rights of “Neverwhere” to BBC, Miramax, etc.) • Non-Exclusive – if JKR licenses Viva Films to make Harry Potter, guess who will come with a lawsuit faster than you can say “Wingardium Leviosa?” ☺

SEC. 183. DESIGNATION OF SOCIETY. - THE COPYRIGHT OWNERS OR THEIR HEIRS MAY DESIGNATE A SOCIETY OF ARTISTS, WRITERS OR COMPOSERS TO ENFORCE THEIR ECONOMIC RIGHTS AND MORAL RIGHTS ON THEIR BEHALF. This is also known as collective administration of copyright. There is an organization called “Philippine Society of Songwriters and Recording Artists” which is designated by all its members to take charge of the collection of annual royalty fees from broadcast companies to broadcast their songs, then you split it among all the artists. This does away with the need of collecting royalty fees everytime a BSB song is played. But if you’re not a member, you can’t avail of their collection services. Gotta collect on your own.

SEC. 184. LIMITATIONS ON COPYRIGHT. -

CHAPTER VIII LIMITATIONS ON COPYRIGHT

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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;

(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;

(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

PROVIDED, THAT THE SOURCE IS CLEARLY INDICATED; (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; (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 HAS NOT BEEN EXPRESSLY RESERVED:

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.

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

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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;

published/unpublished factual/fictional - Defense of fair use has more chance in unpublished work than a published work. However, there is little chance for the defense of an unpublished creative work to hold since in fictional work, there is more creative input than factual work

(C) THE

AMOUNT AND SUBSTANTIALITY OF THE PORTION USED IN RELATION TO THE COPYRIGHTED WORK

AS A WHOLE; AND

-if portion copied is “heart” of the work

(D) THE -

EFFECT OF THE USE UPON THE POTENTIAL MARKET FOR OR VALUE OF THE COPYRIGHTED WORK.

test is both the present and future market

NOTE: Each Fair Use case is treated differently. The most important test in each case differs. 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. Fair Use – always involves a balancing of interests of the copyright owner and the public. • The copyright owner has the right to exploit his work; • The public has the right to information and the right to share this information. When you cross the line, it is considered copyright infringement. At this point, Atty. Lim discussed the Napster case (unassigned). Here is a Q&A. Q: Napster itself does not copy or distribute music files. So, why are the record companies suing Napster? A: It was the end users who were allegedly committing the direct infringement by making music files available and downloading files without authorization. For several reasons, such as the problem of end-users being judgment-proof, or the need to bring thousands, if not millions, of lawsuits to stop the infringement, the record companies initiated the action against the company, which in their eyes facilitated the infringement. It was alleged that Napster should be liable under a theory of either contributory infringement or vicarious liability One may be liable for contributory infringement if one "with knowledge of the infringing activity, induces, causes, or materially contributes to the infringing conduct of another." In the Napster case, the plaintiffs alleged that Napster's facilitation of the identifying and downloading of files constituted contributory infringement. In the Napster case, the plaintiffs claimed that Napster had the ability to control the activity, by allowing or filtering out the music files. Because Napster could get advertising revenue based upon the number of "hits," it, too, was alleged that Napster had a financial interest in the infringement. Q: Isn't this a "fair use"? A: The fair use doctrine, sometimes called "an equitable rule of reason," was initially judicially created to allow the use of portions of a work for purposes of criticism and comment, news reporting, scholarship, teaching, etc. The fair use doctrine is now part of the current Copyright Act. (1) The Purpose And Character Of The Use

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Merely uploading and downloading copies of the music files -- was not transformative. The court then proceeded to look to the commercial or non-commercial nature of the work. The more commercial the use, the less latitude for the unauthorized user. In the Napster case, the court found the use to be commercial. Although there was no exchange of money or sale of the files, the court nonetheless found the use to be commercial, affirming the district court's findings that (1) "a host user sending a file cannot be said to engage in personal use when distributing that file to an anonymous requester" and (2) "Napster users get for free something they would ordinarily have to buy." The court continued, "Commercial use is demonstrated by a showing that repeated and exploitative unauthorized copies of copyrighted works were made to save the expense of purchasing copies." The court also noted that for purposes of criminal law, the definition of "financial gain" also includes "the receipt of other copyrighted works." (2) The Nature of the Copyrighted Work In the Napster case, the works being copied are creative works -- music. The creative nature of the musical compositions and sound recordings "cut against" a finding of fair use. The Ninth Circuit again agreed with the lower court's determination. (3) The Amount And Substantiality Of The Portion Used In Relation To The Copyrighted Work As A Whole In the Napster case, the determination was easy. The end-users who were doing the downloading were taking copies of the entire song. The taking was therefore both quantitatively and qualitatively substantial. Therefore, this factor also favored the plaintiff record companies. (4) The Effect on the Potential Market or Value for the Work The Ninth Circuit court in the Napster case affirmed the lower court's finding that Napster harmed the market for the works in "at least" two ways: (1) "it reduces audio CD sales among college students" and 2) "it raises barriers to plaintiffs' entry into the market for the digital downloading of music." In reaching its decision, the court paid particular attention to the expert's report showing that on college campuses, there was evidence of lost retail sales of CDs on college campuses. Such lost sales were taken to be sufficient to support the finding of "irreparable harm" needed for an injunction. The court did not place very much credence in the report by Napster's expert that the sharing of files stimulates demand for sales of CDs. The court did not accept that argument. The court also found Napster interfered with the record companies' efforts to legitimately license their sound recordings and musical compositions for Internet-related downloads themselves. If it is easy to get the music files for free, why would one go to the authorized site and pay for them? This, of course, assumes that the end-users have a sense of not being in any danger whatsoever for doing the uploading and downloading. Q: Isn't this like the Universal City Studios v. Sony case? If it was OK to videotape television shows for personal use in Sony, why isn't it acceptable to copy music from the Internet for personal use? A: At the time the Sony case was brought in district court, more than 20 years ago, the record showed that most people merely "time-shifted" the television shows. They recorded shows that were on the air at inconvenient times or when they were not home. Most importantly, Universal was not able to show that the users were archiving or "librarying" the tapes. The situation in the Napster case is completely different. First, there is no precedent in Napster's favor for "space shifting". In Texaco, in-house researchers at Texaco copied and kept articles from scientific journals. The Second Circuit emphasized that copies of the articles were in the files. Q: Isn't this really the same as just swapping some CDs or music files with your friends? A: All of the files are compressed and converted to MP3 or an analogous technology to facilitate the fast copying of the CDs. During the "marathon," thousands and thousands of CDs are copied. At the end of the marathon, each person who entered leaves with the CDs he or she arrived with, as well as at least another 100. Essentially, this is what's going on in the Napster case. It is hard to imagine that this would not be infringement! It would be difficult to argue that this was "non-commercial copying for personal use." Q: Will Napster be shut down? A: The court's injunction does not require Napster to shut down. It does, however, require Napster to filter out the files that have been identified by the plaintiff record companies. It remains to be seen whether Napster will be able to comply with the terms of the injunction, and if not, what will happen next. In the meanwhile, as mentioned above, the record companies are entering into agreements with various companies for the distribution of music. I would not be surprised if, in the not-too-distant future, we see several "reasonably priced" subscription based online services providing downloadable music files.

IMPT NOTE: When you raise fair use as a defense, you admit the facts in the complaint. Therefore: 1.) Plaintiff will no longer have to prove the facts, the trial now centers on whether or not there was fair use. 2.) It would be an inconsistent defense if you allege fair use and you allege that you were not the one doing the infringing.

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Q. Chris Lim copies substantial portions of a book of a UP professor on IP, then he gives it out to students and anyone who wants a copy. Infringement? A. Yes. The fact that it is for free does not necessarily mean it is fair use. Q. If the IP Code were amended to read, “So long as copyrighted material is used in school, it is fair use.” Would this be constitutional? A. Maybe not. It would be undue deprivation of property. It would also remove all incentive to create, write law books for instance (YEHEY!!) or develop computer programs for school usage. Q. When Chris Lim says, “I copied large portions of Atty. X’s work,” is this a valid defense? A. No. It may serve to limit liability, but if substantial portions of the work is copied, attribution will not protect you. Protection only exists when excerpts are used. Note: Traditional copyright is easier to protect than digital copyright. SONY CORP. v. UNIVERSAL CITY STUDIOS, INC., 464 U.S. 417 (1984) Petitioners manufacture and sell home video tape recorders. Respondents own the copyrights on some of the television programs that are broadcast on the public airwaves. Some members of the general public use video tape recorders sold by petitioners to record some of these broadcasts, as well as a large number of other broadcasts. Respondents commenced this copyright infringement action against petitioners in the United States District Court for the Central District of California in 1976. Respondents alleged that some individuals had used Betamax video tape recorders (VTR's) to record some of respondents' copyrighted works which had been exhibited on commercially sponsored television and contended that these individuals had thereby infringed respondents' copyrights. Respondents further maintained that petitioners were liable for the copyright infringement allegedly committed by Betamax consumers because of petitioners' marketing of the Betamax VTR's. Respondents sought no relief against any Betamax consumer. Instead, they sought money damages and an equitable accounting of profits from petitioners, as well as an injunction against the manufacture and marketing of Betamax VTR's. An explanation of our rejection of respondents' unprecedented attempt to impose copyright liability upon the distributors of copying equipment requires a quite detailed recitation of the findings of the District Court. In summary, those findings reveal that the average member of the public uses a VTR principally to record a program he cannot view as it is being televised and then to watch it once at a later time. This practice, known as "time-shifting," enlarges the television viewing audience. For that reason, a significant amount of television programming may be used in this manner without objection from the owners of the copyrights on the programs. For the same reason, even the two respondents in this case, who do assert objections to time-shifting in this litigation, were unable to prove that the practice has impaired the commercial value of their copyrights or has created any likelihood of future harm.

Held: Given these findings, there is no basis in the Copyright Act upon which respondents can hold petitioners liable for distributing VTR's to the general public. Each of the respondents owns a large inventory of valuable copyrights, but in the total spectrum of television programming their combined market share is small. The exact percentage is not specified, but it is well below 10%. If they were to prevail, the outcome of this litigation would have a significant impact on both the producers and the viewers of the remaining 90% of the programming in the Nation. No doubt, many other producers share respondents' concern about the possible consequences of unrestricted copying. Nevertheless the findings of the District Court make it clear that timeshifting may enlarge the total viewing audience and that many producers are willing to allow private timeshifting to continue, at least for an experimental time period.

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Die Another Day I'm gonna wake up, yes and no I'm gonna kiss some part of I'm gonna keep this secret I'm gonna close my body now I I I I

guess, guess, guess, guess,

die die die die

another another another another

day day day day

I guess I'll die another (Another day) I guess I'll die another (Another day) I guess I'll die another (Another day) I guess I'll die another

day day day day

Sigmund Freud Analyze this Analyze this Analyze this I'm gonna break the cycle I'm gonna shake up the system I'm gonna destroy my ego I'm gonna close my body now Uh, uh I think I'll find another way There's so much more to know I guess I'll die another day It's not my time to go For every sin, I'll have to pay I've come to work, I've come to play I think I'll find another way It's not my time to go I'm gonna avoid the cliche I'm gonna suspend my senses I'm gonna delay my pleasure I'm gonna close my body now I guess, die another day I guess I'll die another day I guess, die another day I guess I'll die another day 2

I think I'll find another way There's so much more to know I guess I'll die another day It's not my time to go Uh, uh I guess, die another day I guess I'll die another day I guess, die another day I guess I'll die another day

If there are millions of owners of VTR's who make copies of televised sports events, religious broadcasts, and educational programs such as Mister Rogers' Neighborhood, and if the proprietors of those programs welcome the practice, the business of supplying the equipment that makes such copying feasible should not be stifled simply because the equipment is used by some individuals to make unauthorized reproductions of respondents' works. The respondents do not represent a class composed of all copyright holders. Yet a finding of contributory infringement would inevitably frustrate the interests of broadcasters in reaching the portion of their audience that is available only through time-shifting. Of course, the fact that other copyright holders may welcome the practice of time-shifting does not mean that respondents should be deemed to have granted a license to copy their programs. Third-party conduct would be wholly irrelevant in an action for direct infringement of respondents' copyrights. But in an action for contributory infringement against the seller of copying equipment, the copyright holder may not prevail unless the relief that he seeks affects only his programs, or unless he speaks for virtually all copyright holders with an interest in the outcome. In this case, the record makes it perfectly clear that there are many important producers of national and local television programs who find nothing objectionable about the enlargement in the size of the television audience that results from the practice of time-shifting for private home use. The seller of the equipment that expands those producers' audiences cannot be a contributory infringer if, as is true in this case, it has had no direct involvement with any infringing activity. Even unauthorized uses of a copyrighted work are not necessarily infringing. An unlicensed use of the copyright is not an infringement unless it conflicts with one of the specific exclusive rights conferred by the copyright statute. Moreover, the definition of exclusive rights in 106 of the present Act is prefaced by the words "subject to sections 107 through 118." Those sections describe a variety of uses of copyrighted material that "are not infringements of copyright" "notwithstanding the provisions of section 106." The most pertinent in this case is 107, the legislative endorsement of the doctrine of "fair use."

Another day [x6]

That section identifies various factors that enable a court to apply an "equitable rule of reason" analysis to particular claims of infringement. Although not conclusive, the first factor requires that "the commercial or nonprofit character of an activity" be weighed in any fair use decision. If the Betamax were used to make

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copies for a commercial or profitmaking purpose, such use would presumptively be unfair. The contrary presumption is appropriate here, however, because the District Court's findings plainly establish that timeshifting for private home use must be characterized as a noncommercial, nonprofit activity. Moreover, when one considers the nature of a televised copyrighted audiovisual work, and that time-shifting merely enables a viewer to see such a work which he had been invited to witness in its entirety free of charge, the fact that the entire work is reproduced, see 107(3), does not have its ordinary effect of militating against a finding of fair use. This is not, however, the end of the inquiry because Congress has also directed us to consider "the effect of the use upon the potential market for or value of the copyrighted work." 107(4). The purpose of copyright is to create incentives for creative effort. Even copying for noncommercial purposes may impair the copyright holder's ability to obtain the rewards that Congress intended him to have. But a use that has no demonstrable effect upon the potential market for, or the value of, the copyrighted work need not be prohibited in order to protect the author's incentive to create. The prohibition of such noncommercial uses would merely inhibit access to ideas without any countervailing benefit. Thus, although every commercial use of copyrighted material is presumptively an unfair exploitation of the monopoly privilege that belongs to the owner of the copyright, noncommercial uses are a different matter. A challenge to a noncommercial use of a copyrighted work requires proof either that the particular use is harmful, or that if it should become widespread, it would adversely affect the potential market for the copyrighted work. Actual present harm need not be shown; such a requirement would leave the copyright holder with no defense against predictable damage. Nor is it necessary to show with certainty that future harm will result. What is necessary is a showing by a preponderance of the evidence that some meaningful likelihood of future harm exists. If the intended use is for commercial gain, that likelihood may be presumed. But if it is for a noncommercial purpose, the likelihood must be demonstrated. When these factors are all weighed in the "equitable rule of reason" balance, we must conclude that this record amply supports the District Court's conclusion that home time-shifting is fair use. In light of the findings of the District Court regarding the state of the empirical data, it is clear that the Court of Appeals erred in holding that the statute as presently written bars such conduct. In summary, the record and findings of the District Court lead us to two conclusions. First, Sony demonstrated a significant likelihood that substantial numbers of copyright holders who license their works for broadcast on free television would not object to having their broadcasts time-shifted by private viewers. And second, respondents failed to demonstrate that time-shifting would cause any likelihood of nonminimal harm to the potential market for, or the value of, their copyrighted works. The Betamax is, therefore, capable of substantial noninfringing uses. Sony's sale of such equipment to the general public does not constitute contributory infringement of respondents' copyrights. STEWART v. ABEND, 495 U.S. 207 (1990) 495 U.S. 207 Cornell Woolrich authored the story "It Had to Be Murder," which was first published in February 1942 in Dime Detective Magazine. The magazine's publisher, Popular Publications, Inc., obtained the rights to magazine publication of the story and Woolrich retained all other rights. Popular Publications obtained a blanket copyright for the issue of Dime Detective Magazine in which "It Had to Be Murder" was published. The Copyright Act of 1909 provided authors a 28-year initial term of copyright protection plus a 28-year renewal term. In 1945, Woolrich agreed to assign the rights to make motion picture versions of six of his stories, including "It Had to Be Murder," to B. G. De Sylva Productions for $9,250. He also agreed to renew the copyrights in the stories at the appropriate time and to assign the same motion picture rights to De Sylva Productions for the 28-year renewal term. In 1953, actor Jimmy Stewart and director Alfred Hitchcock formed a production company, Patron, Inc., which obtained the motion picture rights in "It Had to Be Murder" from De Sylva's successors in interest for $10,000.

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In 1954, Patron, Inc., along with Paramount Pictures, produced and distributed "Rear Window," the motion picture version of Woolrich's story "It Had to Be Murder." Woolrich died in 1968 before he could obtain the rights in the renewal term for petitioners as promised and without a surviving spouse or child. He left his property to a trust administered by his executor, Chase Manhattan Bank, for the benefit of Columbia University. On December 29, 1969, Chase Manhattan Bank renewed the copyright in the "It Had to Be Murder" story. Chase Manhattan assigned the renewal rights to respondent Abend for $650 plus 10% of all proceeds from exploitation of the story. "Rear Window" was broadcast on the ABC television network in 1971. Respondent then notified petitioners Hitchcock (now represented by cotrustees of his will), Stewart, and MCA Inc., the owners of the "Rear Window" motion picture and renewal rights in the motion picture, that he owned the renewal rights in the copyright and that their distribution of the motion picture without his permission infringed his copyright in the story. Hitchcock, Stewart, and MCA nonetheless entered into a second license with ABC to rebroadcast Petitioners assert that even if their use of "It Had to Be Murder" is unauthorized, it is a fair use and, therefore, not infringing. At common law, "the property of the author . . . in his intellectual creation [was] absolute until he voluntarily part[ed] with the same. The fair use doctrine, which is incorporated into the 1976 Act, evolved in response to this absolute rule.

Held: The Court of Appeals determined that the use of Woolrich's story in petitioners' motion picture was not fair use. We agree. The motion picture neither falls into any of the categories enumerated in 107 nor meets the four criteria set forth in 107. "[E]very [unauthorized] commercial use of copyrighted material is presumptively an unfair exploitation of the monopoly privilege that belongs to the owner of the copyright." Petitioners received $12 million from the re-release of the motion picture during the renewal term. Petitioners asserted before the Court of Appeals that their use was educational rather than commercial. The Court of Appeals found nothing in the record to support this assertion, nor do we. Applying the second factor, the Court of Appeals pointed out that "[a] use is less likely to be deemed fair when the copyrighted work is a creative product." In general, fair use is more likely to be found in factual works than in fictional works. The law generally recognizes a greater need to disseminate factual works than works of fiction or fantasy. A motion picture based on a fictional short story obviously falls into the latter category. Examining the third factor, the Court of Appeals determined that the story was a substantial portion of the motion picture. The motion picture expressly uses the story's unique setting, characters, plot, and sequence of events. Petitioners argue that the story constituted only 20% of the motion picture's story line, but that does not mean that a substantial portion of the story was not used in the motion picture. "[A] taking may not be excused merely because it is insubstantial with respect to the infringing work." The fourth factor is the "most important, and indeed, central fair use factor." The record supports the Court of Appeals' conclusion that re-release of the film impinged on the ability to market new versions of the story. Common sense would yield the same conclusion. Thus, all four factors point to unfair use. "This case presents a classic example of an unfair use: a commercial use of a fictional story that adversely affects the story owner's adaptation rights." PLAYBOY ENTERPRISES, INC., Plaintiff, v. George FRENA George Frena operates a subscription computer bulletin board service, Techs Warehouse BBS ("BBS"), that distributed unauthorized copies of Plaintiff Playboy Enterprises, Inc.'s copyrighted photographs. BBS is accessible via telephone modem to customers. For a fee, or to those who purchase certain products from Defendant Frena, anyone with an appropriately equipped computer can log onto BBS. Once logged on subscribers may browse through different BBS directories to look at the pictures and customers may also download the high quality computerized copies of the photographs and then store the copied image from Frena's computer onto their home computer. Many of the images found on BBS include adult subject matter. One hundred and seventy of the images that were available on BBS were copies of photographs taken from PEI's copyrighted materials.

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Defendant Frena admits that (1) these materials were displayed on his BBS, (2) that he never obtained authorization or consent from PEI, and (3) that each of the accused computer graphic files on BBS is substantially similar to copyrighted PEI photographs and (4) that each of the files in question has been downloaded by one of his customers. Subscribers can upload material onto the bulletin board so that any other subscriber, by accessing their computer, can see that material. Defendant Frena states that he never uploaded any of PEI's photographs onto BBS and that subscribers to BBS uploaded the photographs. Defendant Frena states that as soon as he was served with a summons and made aware of this matter, he removed the photographs from BBS and has since that time monitored BBS to prevent additional photographs of PEI from being uploaded. Defendant Frena argues that the affirmative defense of fair use precludes a finding of copyright infringement.

Held: The question of fair use constitutes a mixed issue of law and fact. The Copyright Act mandates four nonexclusive factors which courts shall consider case by case in determining fair use. Section 107 does not attempt to define "fair use." It merely lists the factors to be considered in determining whether a use made of a work in a particular case is fair. FIRST: every commercial use of copyrighted material is presumptively an unfair exploitation of the monopoly privilege that belongs to the owner of the copyright ...," Defendant Frena's use was clearly commercial. BBS was provided to those paying twenty-five dollars ($25) per month or to those who purchased products from Defendant Frena. One who distributes copyrighted material for profit is engaged in a commercial use even if the customers supplied with such material themselves use it for personal use. Implicit in the presumption that every commercial use is presumptively unfair is "some meaningful likelihood that future market harm exists." It is clear that future market harm exists to PEI due to Frena's activities SECOND: the "nature of the copyrighted work." "Copyright protection is narrower, and the corresponding application of fair use defense greater, in the case of factual works than in the case of works of fiction or fantasy." If a work is more appropriately characterized as entertainment, it is less likely that a claim of fair use will be accepted. The copyrighted works involved in this case are in the category of fantasy and entertainment. Therefore, the second factor works against Frena's fair use defense. THIRD: the amount and substantiality of the portion of the copyrighted work used, the Supreme Court has directed a qualitative evaluation of the copying of the copyrighted work. That is, "a small degree of taking is sufficient to transgress fair use if the copying is the essential part of the copyrighted work." There is no

doubt that the photographs in Playboy magazine are an essential part of the copyrighted work. The Court is not implying that people do not read the articles in PEI's magazine. However, a major factor to PEI's success is the photographs in its magazine. By pirating the photographs for which PEI has become famous, Defendant Frena has taken a very important part of PEI's copyrighted publications.

FOURTH: the "effect of the use upon the potential market for or value of the copyrighted work," is "undoubtedly the single most important element of fair use, since a proper application of fair use does not impair materially the marketability of the copied work." This factor poses the issue of "whether unrestricted and widespread conduct of the sort engaged in by the defendant (whether in fact engaged in by the defendant or others) would result in a substantially adverse impact on the potential market for or value of the plaintiff's present work.” [P]otential market means either an immediate or delayed market, and includes harm to derivative works. Obviously, if this type of conduct became widespread, it would adversely affect the potential market for the copyrighted work. Such conduct would deny PEI considerable revenue to which it is entitled for the service it provides. There is irrefutable evidence of direct copyright infringement in this case. It does not matter that Defendant Frena may have been unaware of the copyright infringement. Intent to infringe is not needed to find copyright

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infringement. Intent or knowledge is not an element of infringement, and thus even an innocent infringer is liable for infringement; rather, innocence is significant to a trial court when it fixes statutory damages, which is a remedy equitable in nature. SEGA ENTERPRISES LTD. v. MAPHIA Sega is a major manufacturer and distributor of computer video game systems and computer video games which are sold under the SEGA trademark. The Sega game system consists of two major components sold by Sega: the game console and software programs stored on video game cartridges which are inserted into the base unit. Each cartridge contains a single game program. The base unit contains a microcomputer which, when connected to a television, permits individuals to play the video game stored on the inserted cartridge. The computer programs for the Sega video games are stored on a cartridge in a Read-Only Memory ("ROM") chip. Sega's video games cannot be copied using the game console. However, as noted below, running devices, called "copiers," are designed to copy the video game programs from a Sega game cartridge onto other magnetic media such as hard and floppy disks. An electronic bulletin board consists of electronic storage media, such as computer memories or hard disks, which is attached to telephone lines via modem devices, and controlled by a computer. Third parties, known as "users," of electronic bulletin boards can transfer information over the telephone lines from their own computers to the storage media on the bulletin board by a process known as "uploading." Defendants MAPHIA and Chad Scherman operate an electronic bulletin board called MAPHIA (hereinafter "the MAPHIA bulletin board"). The MAPHIA bulletin board is open to the public and, according to Defendant Scherman's Opposition Memorandum, has approximately 400 users. The evidence establishes that Sega's copyrighted video games are available on and transferred to and from the MAPHIA bulletin board by users who upload and download games. Once a game is uploaded to the MAPHIA bulletin board it may be downloaded in its entirety by an unlimited number of users. It appears that the copies of Sega's video game programs on Defendants' bulletin board are unauthorized copies of Sega's copyrighted video games, having been uploaded there by users of Defendant's bulletin board. There is evidence that MAPHIA directly or through an affiliate sometimes charges a direct fee for downloading privileges, or barters for the privilege of downloading Sega's games. Information on the MAPHIA bulletin board includes the following passage: Thank you for purchasing a Console Back Up Unit [copier] from PARSEC TRADING. As a free bonus for ordering from Dark Age, you receive a COMPLEMENTARY Free Download Ratio on our Customer Support BBS. Defendant thus provides downloading privileges for Sega games to users in exchange for the uploading of Sega games or other programs or information or in exchange for payment for other goods, such as copiers, or services, such as the provision of credit card numbers to users.

Held: Sega has established that unauthorized copies of these games are also made when they are downloaded

to make additional copies by users, which copying is facilitated and encouraged by the MAPHIA bulletin board. "[O]ne who, with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another," may be held liable as a contributory infringer. Even if Defendants do not know exactly when games will be uploaded to or downloaded from the MAPHIA bulletin board, their role in the copying, including provision of facilities, direction, knowledge and encouragement, amounts to contributory copyright infringement. Defendants raise fair use as a defense to copyright infringement. However, to invoke the fair use exception, an individual must possess an authorized copy of a literary work." Defendant Scherman has stated that he does not own any Sega game cartridges. When copying is for the purpose of making multiple copies of the original, and thereby saving users the expense of purchasing additional authorized copies, this militates against a finding of fair use under the purpose of the use factor. Because users of the MAPHIA bulletin board are likely and encouraged to download Sega games therefrom to avoid having to buy video game cartridges from Sega, by which avoidance such users and Defendants both profit, the commercial purpose and character of the unauthorized copying weighs against a finding of fair use. Because Sega video game programs are for entertainment uses and involve fiction and fantasy, consideration of the nature of the copyrighted work weighs against a finding of fair use. Because it appears that the entire game programs are copied when Sega video game programs are transferred over the MAPHIA bulletin board, consideration of the amount and substantiality of the portion copied weighs against a finding of fair use. "The fourth factor, the effect of the use upon the market for or value of the copyrighted work, 'is undoubtedly the

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single most important element of fair use.'" "[T]o negate fair use one need only show that if the challenged use 'should become widespread, it would adversely affect the potential market for the copyrighted work.' Based on Defendants' own statement that 45,000 bulletin boards like MAPHIA operate in this country, it is obvious that should the unauthorized copying of Sega's video games by Defendants and others become widespread, there would be a substantial and immeasurable adverse effect on the market for Sega's copyrighted video game programs. Consideration of the effect on the market for Sega's copyrighted works weighs heavily against a finding of fair use. Q. You can’t play pirated games in Playstation. Someone invents a chip to allow you to use it. Is this infringement? A. No. Violates no moral rights. However, WIPO treaty provides that there should be legislatioin against anticircumvention devices. This is such a devise. Another example of an ACD is a devise which disables visitorcounting devices in websites. Q. Is viewing (such as when you play a program or view a tape) infringement? A. No. It’s private use. If you view it yourself, it’s okay. Even if you share it with barangay. But if you sell the chips to video stores which has 100 consoles, it may be considered contributory infringement. NOTE: There is a difference between a infringing copy and a non-infringing copy. NOTE: Software is reproduced when you use it. It is reproduced in your Random Access Memory. RELIGIOUS TECHNOLOGY CENTER v. NETCOM ON-LINE COMMUNICATION SERVICES Plaintiffs Religious Technology Center ("RTC") and Bridge Publications, Inc. ("BPI") hold copyrights in the unpublished and published works of L. Ron Hubbard, the late founder of the Church of Scientology ("the Church"). Defendant Dennis Erlich is a former minister of Scientology turned vocal critic of the Church, whose pulpit is now the Usenet newsgroup alt.religion.scientology ("a.r.s."), an on-line forum for discussion and criticism of Scientology. Plaintiffs maintain that Erlich infringed their copyrights when he posted portions of their works on a.r.s. Erlich gained his access to the Internet through defendant Thomas Klemesrud's ("Klemesrud's") BBS "support.com." Klemesrud is the operator of the BBS, which is run out of his home and has approximately 500 paying users. Klemesrud's BBS is not directly linked to the Internet, but gains its connection through the facilities of defendant Netcom On-Line Communications, Inc. ("Netcom"), one of the largest providers of Internet access in the United States. After failing to convince Erlich to stop his postings, plaintiffs contacted defendants Klemesrud and Netcom. Klemesrud responded to plaintiffs' demands that Erlich be kept off his system by asking plaintiffs to prove that they owned the copyrights to the works posted by Erlich. However, plaintiffs refused Klemesrud's request as unreasonable. Netcom similarly refused plaintiffs' request that Erlich not be allowed to gain access to the Internet through its system. Netcom contended that it would be impossible to prescreen Erlich's postings and that to kick Erlich off the Internet meant kicking off the hundreds of users of Klemesrud's BBS. Consequently, plaintiffs named Klemesrud and Netcom in their suit against Erlich, although only on the copyright infringement claims. Unlike some other large on-line service providers, such as CompuServe, America Online, and Prodigy, Netcom does not create or control the content of the information available to its subscribers. It also does not monitor messages as they are posted. It has, however, suspended the accounts of subscribers who violated its terms and conditions, such as where they had commercial software in their posted files. Netcom admits that, although not currently configured to do this, it may be possible to reprogram its system to screen postings containing particular words or coming from particular individuals. Netcom, however, took no action after it was told by plaintiffs that Erlich had posted messages through Netcom's system that violated plaintiffs' copyrights, instead claiming that it could not shut out Erlich without shutting out all of the users of Klemesrud's BBS.

Held: FIRST the purpose and character of the defendant's use. Netcom's use of plaintiffs' work is to carry

out its commercial function as an Internet access provider. Such a use, regardless of the underlying uses made by Netcom's subscribers, is clearly commercial. Netcom's use, though commercial, also benefits the public in

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allowing for the functioning of the Internet and the dissemination of other creative works, a goal of the Copyright Act. Although Netcom gains financially from its distribution of messages to the Internet, its financial incentive is unrelated to the infringing activity and the defendant receives no direct financial benefit from the acts of infringement. Therefore, the commercial nature of the defendant's activity should not be dispositive. Moreover, there is no easy way for a defendant like Netcom to secure a license for carrying every possible type of copyrighted work onto the Internet. Thus, it should not be seen as "profit[ing] from the exploitation of the copyrighted work without paying the customary prices." Because Netcom's use of copyrighted materials served a completely different function than that of the plaintiffs, this factor weighs in Netcom's favor. SECOND: whether it is published or unpublished and whether it is informational or creative. Plaintiffs rely on the fact that some of the works transmitted by Netcom were unpublished and some were arguably highly creative and original. However, because Netcom's use of the works was merely to facilitate their posting to the Usenet, which is an entirely different purpose than plaintiffs' use (or, for the matter, Erlich's use), the precise nature of whose works is not important to the fair use determination.

THIRD concerns both the percentage of the original work that was copied and whether that portion

constitutes the "heart" of the copyrighted work. Generally, no more of a work may be copied than is necessary for the particular use. The copying of an entire work will ordinarily militate against a finding of fair use, although this is not a per se rule. Plaintiffs have shown that Erlich's posting copied substantial amounts of the originals or, in some cases, the entire works. Netcom, of course, made available to the Usenet exactly what was posted by Erlich. As the court found in Sony, the mere fact that all of a work is copied is not determinative of the fair use question, where such total copying is essential given the purpose of the copying. Id. (allowing total copying in context of time-shifting copyrighted television shows by home viewers). Here, Netcom copied no more of plaintiffs' works than necessary to function as a Usenet server. Accordingly, this factor should not defeat an otherwise valid defense.

FOURTH "the extent of market harm caused by the particular actions of the alleged infringer" and "whether

unrestricted and widespread conduct of the sort engaged in by the defendant . . . would result in a substantially adverse impact on the potential market' for the original." Netcom argues that there is no evidence that making accessible plaintiffs' works, which consist of religious scriptures and policy letters, will harm the market for these works by preventing someone from participating in the Scientology religion because they can view the works on the Internet instead. Further, Netcom notes that the relevant question is whether the posting fulfill the demand of an individual who seeks to follow the religion's teachings, and not whether they suppress the desire of an individual who is affected by the criticism posted by Erlich. Netcom argues that the court must focus on the "normal market" for the copyrighted work, which in this case is through a Scientology-based organization. Plaintiffs respond that the Internet's extremely widespread distribution-where more than 25 million people worldwide have access--multiplies the effects of market substitution. In support of its motion for a preliminary injunction against Erlich, plaintiffs submitted declarations regarding the potential effect of making the Church's secret scriptures available over the Internet. Plaintiffs pointed out that, although the Church currently faces no competition, groups in the past have used stolen copies of the Church's scriptures in charging for Scientology-like religious training. This evidence raises a genuine issue as to the possibility that Erlich's postings, made available over the Internet by Netcom, could hurt the market for plaintiffs' works. In balancing the various factors, the court finds that there is a question of fact as to whether there is a valid fair use defense. Netcom has not justified its copying plaintiffs' works to the extent necessary to establish entitlement to summary judgment in light of evidence that it knew that Erlich's use was infringing and had the ability to prevent its further distribution. While copying all or most of a work will often preclude fair use, courts have recognized the fair use defense where the purpose of the use is beneficial to society, complete copying is necessary given the type of use, the purpose of the use is completely different than the purpose of

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the original, and there is no evidence that the use will significantly harm the market for the original. This case is distinguishable from those cases recognizing fair use despite total copying. In Sony, the home viewers' use was not commercial and the viewers were allowed to watch the entire shows for free. Here, plaintiffs never gave either Erlich or Netcom permission to view or copy their works. Netcom's use has some commercial aspects. Further, Netcom's copying is not for the purpose of getting to the unprotected idea behind plaintiffs' works. Although plaintiffs may ultimately lose on their infringement claims if, among other things, they cannot prove that posting their copyrighted works will harm the market for these works. Fair use presents a factual question on which plaintiffs have at least raised a genuine issue of fact. Accordingly, the court does not find that Netcom's use was fair as a matter of law. NOTE: Digital works – the moment you post materials on the site (internet site) it is considered noncopyrightable unless you place the fact of its being copyrighted in a conspicuous place in the site. SEC. 186. WORK OF ARCHITECTURE. - COPYRIGHT IN A WORK OF ARCHITECTURE SHALL INCLUDE THE RIGHT TO CONTROL THE ERECTION OF ANY BUILDING WHICH REPRODUCES THE WHOLE OR A SUBSTANTIAL PART OF THE WORK EITHER IN ITS ORIGINAL FORM OR IN ANY FORM RECOGNIZABLY DERIVED FROM THE ORIGINAL;

PROVIDED, THAT

THE COPYRIGHT IN ANY SUCH WORK

SHALL NOT INCLUDE THE RIGHT TO CONTROL THE RECONSTRUCTION OR REHABILITATION IN THE SAME STYLE AS THE ORIGINAL OF A BUILDING TO WHICH THE COPYRIGHT RELATES. (N)

SEC. 187. REPRODUCTION OF PUBLISHED WORK. 187.1. NOTWITHSTANDING THE PROVISION OF SECTION 177, AND SUBJECT TO THE PROVISIONS OF SUBSECTION 187.2, THE PRIVATE REPRODUCTION OF A PUBLISHED WORK IN A SINGLE COPY, WHERE THE REPRODUCTION IS MADE BY A NATURAL PERSON EXCLUSIVELY FOR RESEARCH AND PRIVATE STUDY, SHALL BE PERMITTED, WITHOUT THE AUTHORIZATION OF THE OWNER OF COPYRIGHT IN THE WORK. 187.2. THE PERMISSION GRANTED UNDER SUBSECTION 187.1 SHALL NOT EXTEND TO THE REPRODUCTION OF: (A) A WORK OF ARCHITECTURE IN FORM OF BUILDING OR OTHER CONSTRUCTION; (B) AN ENTIRE BOOK, OR A SUBSTANTIAL PAST THEREOF, OR OF A MUSICAL WORK IN WHICH GRAPHICS FORM BY REPROGRAPHIC MEANS; (C) A COMPILATION OF DATA AND OTHER MATERIALS; (D) A COMPUTER PROGRAM EXCEPT AS PROVIDED IN SECTION 189; AND (E) ANY WORK IN CASES WHERE REPRODUCTION WOULD UNREASONABLY CONFLICT WITH A NORMAL EXPLOITATION OF THE WORK OR WOULD OTHERWISE UNREASONABLY PREJUDICE THE LEGITIMATE INTERESTS OF THE AUTHOR. (N)

SEC. 188. REPROGRAPHIC REPRODUCTION BY LIBRARIES. 188.1. NOTWITHSTANDING THE PROVISIONS OF SUBSECTION 177.6, ANY LIBRARY OR ARCHIVE WHOSE ACTIVITIES ARE NOT FOR PROFIT MAY, WITHOUT THE AUTHORIZATION OF THE AUTHOR OF COPYRIGHT OWNER, MAKE A SINGLE COPY OF THE WORK BY REPROGRAPHIC REPRODUCTION: (A) WHERE THE WORK BY REASON OF ITS FRAGILE CHARACTER OR RARITY CANNOT BE LENT TO USER IN ITS ORIGINAL FORM; (B) WHERE THE WORKS ARE ISOLATED ARTICLES CONTAINED IN COMPOSITE WORKS OR BRIEF PORTIONS OF OTHER PUBLISHED WORKS AND THE REPRODUCTION IS NECESSARY TO SUPPLY THEM; WHEN THIS IS CONSIDERED EXPEDIENT, TO PERSON REQUESTING THEIR LOAN FOR PURPOSES OF RESEARCH OR STUDY INSTEAD OF LENDING THE VOLUMES OR BOOKLETS WHICH CONTAIN THEM; AND (C) WHERE THE MAKING OF SUCH A COPY IS IN ORDER TO PRESERVE AND, IF NECESSARY IN THE EVENT THAT IT IS LOST, DESTROYED OR RENDERED UNUSABLE, REPLACE A COPY, OR TO REPLACE, IN THE PERMANENT COLLECTION OF ANOTHER SIMILAR LIBRARY OR ARCHIVE, A COPY WHICH HAS BEEN LOST, DESTROYED OR RENDERED UNUSABLE AND COPIES ARE NOT AVAILABLE WITH THE PUBLISHER.

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188.2. NOTWITHSTANDING THE ABOVE PROVISIONS,

IT SHALL NOT BE PERMISSIBLE TO PRODUCE A VOLUME OF A WORK

PUBLISHED IN SEVERAL VOLUMES OR TO PRODUCE MISSING TOMES OR PAGES OF MAGAZINES OR SIMILAR WORKS, UNLESS THE VOLUME, TOME OR PART IS OUT OF STOCK;

PROVIDED, THAT

EVERY LIBRARY WHICH, BY LAW, IS ENTITLED TO

RECEIVE COPIES OF A PRINTED WORK, SHALL BE ENTITLED, WHEN SPECIAL REASONS SO REQUIRE, TO REPRODUCE A COPY OF A PUBLISHED WORK WHICH IS CONSIDERED NECESSARY FOR THE COLLECTION OF THE LIBRARY BUT WHICH IS OUT OF STOCK.

SEC. 189. REPRODUCTION OF COMPUTER PROGRAM. 189.1. NOTWITHSTANDING THE PROVISIONS OF SECTION 177, THE REPRODUCTION IN ONE (1) BACK-UP COPY OR ADAPTATION OF A COMPUTER PROGRAM SHALL BE PERMITTED, WITHOUT THE AUTHORIZATION OF THE AUTHOR OF, OR OTHER OWNER OF COPYRIGHT IN, A COMPUTER PROGRAM, BY THE LAWFUL OWNER OF THAT COMPUTER PROGRAM: PROVIDED, THAT THE COPY OR ADAPTATION IS NECESSARY FOR: (A) THE USE OF THE COMPUTER PROGRAM IN CONJUNCTION WITH A COMPUTER FOR THE PURPOSE, AND TO THE EXTENT, FOR WHICH THE COMPUTER PROGRAM HAS BEEN OBTAINED; AND (B) ARCHIVAL PURPOSES, AND, FOR THE REPLACEMENT OF THE LAWFULLY OWNED COPY OF THE COMPUTER PROGRAM IN THE EVENT THAT THE LAWFULLY OBTAINED COPY OF THE COMPUTER PROGRAM IS LOST, DESTROYED OR RENDERED UNUSABLE. 189.2. NO

COPY OR ADAPTATION MENTIONED IN THIS

ONES DETERMINED IN THIS

SECTION,

SECTION

SHALL BE USED FOR ANY PURPOSE OTHER THAN THE

AND ANY SUCH COPY OR ADAPTATION SHALL BE DESTROYED IN THE EVENT THAT

CONTINUED POSSESSION OF THE COPY OF THE COMPUTER PROGRAM CEASES TO BE LAWFUL.

189.3. THIS

PROVISION SHALL BE WITHOUT PREJUDICE TO THE APPLICATION OF

SECTION 185

WHENEVER

APPROPRIATE. (N)

Computer programs – also just one copy, for

1. Back-up 2. Archival purposes

SEC. 190. IMPORTATION FOR PERSONAL PURPOSES. 190.1. NOTWITHSTANDING THE PROVISION OF SUBSECTION 177.6, BUT SUBJECT TO THE LIMITATION UNDER THE SUBSECTION 185.2, THE IMPORTATION OF A COPY OF A WORK BY AN INDIVIDUAL FOR HIS PERSONAL PURPOSES SHALL BE PERMITTED WITHOUT THE AUTHORIZATION OF THE AUTHOR OF, OR OTHER OWNER OF COPYRIGHT IN, THE WORK UNDER THE FOLLOWING CIRCUMSTANCES: (A) WHEN COPIES OF THE WORK ARE NOT AVAILABLE IN THE PHILIPPINES AND: (I) NOT MORE THAN ONE (1) COPY AT ONE TIME IS IMPORTED FOR STRICTLY INDIVIDUAL USE ONLY; OR (II) THE IMPORTATION IS BY AUTHORITY OF AND FOR THE USE OF THE PHILIPPINE GOVERNMENT; OR

(III) THE IMPORTATION, CONSISTING OF NOT MORE THAN THREE (3) SUCH COPIES OR LIKENESSES IN ANY ONE INVOICE, IS NOT FOR SALE BUT FOR THE USE ONLY OF ANY RELIGIOUS, CHARITABLE, OR EDUCATIONAL SOCIETY OR INSTITUTION DULY INCORPORATED OR REGISTERED, OR IS FOR THE ENCOURAGEMENT OF THE FINE ARTS, OR FOR ANY STATE SCHOOL, COLLEGE, UNIVERSITY, OR FREE PUBLIC LIBRARY IN THE PHILIPPINES. (B) WHEN

SUCH COPIES FORM PARTS OF LIBRARIES AND PERSONAL BAGGAGE BELONGING TO PERSONS OR

FAMILIES ARRIVING FROM FOREIGN COUNTRIES AND ARE NOT INTENDED FOR SALE:

PROVIDED, THAT

SUCH

COPIES DO NOT EXCEED THREE (3).

190.2. COPIES

IMPORTED AS ALLOWED BY THIS

SECTION

MAY NOT LAWFULLY BE USED IN ANY WAY TO VIOLATE THE

RIGHTS OF OWNER THE COPYRIGHT OR ANNUL OR LIMIT THE PROTECTION SECURED BY THIS

ACT,

AND SUCH UNLAWFUL

USE SHALL BE DEEMED AN INFRINGEMENT AND SHALL BE PUNISHABLE AS SUCH WITHOUT PREJUDICE TO THE PROPRIETOR’S RIGHT OF ACTION.

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190.3. SUBJECT

TO THE APPROVAL OF THE

SECRETARY

OF

FINANCE,

THE

COMMISSIONER

OF

CUSTOMS

IS HEREBY

EMPOWERED TO MAKE RULES AND REGULATIONS FOR PREVENTING THE IMPORTATION OF ARTICLES THE IMPORTATION OF WHICH IS PROHIBITED UNDER THIS

SECTION

AND UNDER TREATIES AND CONVENTIONS TO WHICH THE

PHILIPPINES

MAY BE A PARTY AND FOR SEIZING AND CONDEMNING AND DISPOSING OF THE SAME IN CASE THEY ARE DISCOVERED AFTER THEY HAVE BEEN IMPORTED.

CHAPTER IX DEPOSIT AND NOTICE SEC. 191. REGISTRATION AND DEPOSIT WITH NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY.- AFTER

THE FIRST

PUBLIC DISSEMINATION OF PERFORMANCE BY AUTHORITY OF THE COPYRIGHT OWNER OF A WORK FALLING UNDER

SUBSECTIONS 172.1, 172.2 AND 172.3 OF THIS ACT, THERE SHALL, FOR THE PURPOSE OF COMPLETING THE RECORDS OF THE NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY, WITHIN THREE (3) WEEKS, BE REGISTERED AND DEPOSITED WITH IT, BY PERSONAL DELIVERY OR BY REGISTERED MAIL, TWO (2) COMPLETE COPIES OR REPRODUCTIONS OF THE WORK IN SUCH FORM AS THE DIRECTORS OF SAID LIBRARIES MAY PRESCRIBE. A CERTIFICATE OF DEPOSIT SHALL BE ISSUED FOR WHICH THE PRESCRIBED FEE SHALL BE COLLECTED AND THE COPYRIGHT OWNER SHALL BE EXEMPT FROM MAKING ADDITIONAL DEPOSIT OF THE WORKS WITH THE

NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY UNDER OTHER LAWS. IF,

WITHIN THREE

(3)

WEEKS AFTER RECEIPT BY THE COPYRIGHT OWNER OF A WRITTEN DEMAND FROM THE DIRECTORS FOR SUCH DEPOSIT, THE REQUIRED COPIES OR REPRODUCTIONS ARE NOT DELIVERED AND THE FEE IS NOT PAID, THE COPYRIGHT OWNER SHALL BE LIABLE TO PAY A FINE EQUIVALENT TO THE REQUIRED FEE PER MONTH OF DELAY AND TO PAY TO THE NATIONAL THE

SUPREME COURT LIBRARY

LIBRARY AND ONLY THE ABOVE THE SUPREME COURT

THE AMOUNT OF THE RETAIL PRICE OF THE BEST EDITION OF THE WORK.

MENTIONED CLASSES OF WORK SHALL BE ACCEPTED FOR DEPOSIT BY THE

NATIONAL LIBRARY

AND

LIBRARY. SEC. 192. NOTICE OF COPYRIGHT. - EACH

COPY OF A WORK PUBLISHED OR OFFERED FOR SALE MAY CONTAIN A NOTICE

BEARING THE NAME OF THE COPYRIGHT OWNER, AND THE YEAR OF ITS FIRST PUBLICATION, AND, IN COPIES PRODUCED AFTER

THE CREATOR’S DEATH, THE YEAR OF SUCH DEATH.

Q. Is the existence of a certificate proof of the existence of copyright? A. No. That’s all it is, a certificate of deposit. It was important before, especially in Santos v. McCullough Printer Co, 12 SCRA 321 (1964) when registration was needed to obtain a copyright. Here, Mauro Malang registered his copyright of his painting after his “copyright” was violated (his painting was used for greeting cards for two years, only one year was agreed upon). Since he didn’t register before the second printing, he lost his case. Under the IP Code now, You do not need registration in the National Library to get copyright protection. Q. Who issues the certificate? A. National Library and Supreme Court. Q. What kind of works are deposited? A. In the drafting of the code, Atty. Chris Lim suggested to the drafters: 1. National Library – only the 1st 3 in the list (books, letters, articles, letter) since these are the only things that can benefit the collection of the Nat’l Lib. 2. Supreme Court – only works related to the law But the law actually says, all works are to be deposited. Q. What is the significance of certificate? A. Just says that you deposited; NO PRESUMPTION ARISES AS TO COPYRIGHT OWNERSHIP.

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Q. Does the National Library review if work is copyrightable subject matter? A. No. All it certifies is that you deposited two copies there. Q. So how do you prove copyright ownership if you file cases? A. You file an affidavit evidence under Sec. 218.

CHAPTER X MORAL RIGHTS SEC. 193. SCOPE OF MORAL RIGHTS. - THE AUTHOR OF A WORK SHALL, INDEPENDENTLY OF THE ECONOMIC RIGHTS IN SECTION 177 OR THE GRANT OF AN ASSIGNMENT OR LICENSE WITH RESPECT TO SUCH RIGHT, HAVE THE RIGHT: 193.1. 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; 193.2. TO MAKE ANY ALTERATIONS OF HIS WORK PRIOR TO, OR TO WITHHOLD IT FROM PUBLICATION; 193.3. 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 193.4. 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. (SEC. 34, P. D. NO. 49) Moral rights can also be denominated as follows: 1. Paternity – attributing ownership to someone 2. Privacy – the right to withhold publication 3. [Right against] False Attribution 4. [Right to] Integrity NOTE: There are certain instances that although the creator’s moral rights are violated, it would be better not to enforce them. For instance, Atty. Lim gave the example of the author of the Cocodile Files (expose of the Coconut Levy Funds which says it belongs to Danding Cojuanco), who found works authored by another, saying that the funds are public funds (which virtually means a recantation). If he were to enforce his rights and file a complaint (civil or criminal) he would be subjecting himself to criminal prosecution, since he would have to testify that he is the author of the Cocodile Files!

SEC. 194. BREACH OF CONTRACT. - AN

AUTHOR CANNOT BE COMPELLED TO PERFORM HIS CONTRACT TO CREATE A WORK OR

FOR THE PUBLICATION OF HIS WORK ALREADY IN EXISTENCE.

HOWEVER,

HE MAY BE HELD LIABLE FOR DAMAGES FOR BREACH

OF SUCH CONTRACT.

SEC. 195. WAIVER OF MORAL RIGHTS. - AN AUTHOR MAY WAIVE HIS RIGHTS MENTIONED IN SECTION 193 BY A WRITTEN INSTRUMENT, BUT NO SUCH WAIVER SHALL BE VALID WHERE ITS EFFECTS IS TO PERMIT ANOTHER: 195.1. TO USE THE NAME OF THE AUTHOR, OR THE TITLE OF HIS WORK, OR OTHERWISE TO MAKE USE OF HIS REPUTATION WITH RESPECT TO ANY VERSION OR ADAPTATION OF HIS WORK WHICH, BECAUSE OF ALTERATIONS THEREIN, WOULD SUBSTANTIALLY TEND TO INJURE THE LITERARY OR ARTISTIC REPUTATION OF ANOTHER AUTHOR; OR 195.2. TO USE THE NAME OF THE AUTHOR WITH RESPECT TO A WORK HE DID NOT CREATE. SEC. 196. CONTRIBUTION TO COLLECTIVE WORK. - WHEN AN AUTHOR CONTRIBUTES TO A COLLECTIVE WORK,

HAVE HIS CONTRIBUTION ATTRIBUTED TO HIM IS DEEMED WAIVED UNLESS HE EXPRESSLY RESERVES IT.

HIS RIGHT TO

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SEC. 197. EDITING, ARRANGING AND ADAPTATION OF WORK. - IN THE ABSENCE OF A CONTRARY STIPULATION AT THE TIME AN AUTHOR LICENSES OR PERMITS ANOTHER TO USE HIS WORK, THE NECESSARY EDITING, ARRANGING OR ADAPTATION OF SUCH WORK, FOR PUBLICATION, BROADCAST, USE IN A MOTION PICTURE, DRAMATIZATION, OR MECHANICAL OR ELECTRICAL REPRODUCTION IN ACCORDANCE WITH THE REASONABLE AND CUSTOMARY STANDARDS OR REQUIREMENTS OF THE MEDIUM IN WHICH THE WORK IS TO BE USED, SHALL NOT BE DEEMED TO CONTRAVENE THE AUTHOR'S RIGHTS SECURED BY THIS CHAPTER.

NOR

SHALL COMPLETE DESTRUCTION OF A WORK UNCONDITIONALLY TRANSFERRED BY THE AUTHOR BE DEEMED TO VIOLATE

SUCH RIGHTS.

SEC. 198. TERM OF MORAL RIGHTS. 198.1. THE RIGHTS OF AN AUTHOR UNDER THIS CHAPTER SHALL LAST DURING THE LIFETIME OF THE AUTHOR AND FOR FIFTY (50) YEARS AFTER HIS DEATH AND SHALL NOT BE ASSIGNABLE OR SUBJECT TO LICENSE. THE PERSON OR PERSONS TO BE CHARGED WITH THE POSTHUMOUS ENFORCEMENT OF THESE RIGHTS SHALL BE NAMED IN WRITING TO BE FILED WITH THE

NATIONAL LIBRARY. IN

DEFAULT OF SUCH PERSON OR PERSONS, SUCH ENFORCEMENT SHALL DEVOLVE UPON

EITHER THE AUTHOR'S HEIRS, AND IN DEFAULT OF THE HEIRS, THE

DIRECTOR OF THE NATIONAL LIBRARY.

SECTION, "PERSON" SHALL MEAN ANY INDIVIDUAL, PARTNERSHIP, CORPORATION, THE DIRECTOR OF THE NATIONAL LIBRARY MAY PRESCRIBE REASONABLE FEES TO BE CHARGED FOR HIS SERVICES IN THE APPLICATION OF PROVISIONS OF THIS SECTION. (SEC. 39, P. D. NO. 49)

198.2. FOR

PURPOSES OF THIS

ASSOCIATION, OR SOCIETY.

SEC. 199. ENFORCEMENT REMEDIES. - VIOLATION

OF ANY OF THE RIGHTS CONFERRED BY THIS

CHAPTER

SHALL ENTITLE

THOSE CHARGED WITH THEIR ENFORCEMENT TO THE SAME RIGHTS AND REMEDIES AVAILABLE TO A COPYRIGHT OWNER.

IN CIVIL CODE MAY ALSO BE RECOVERED. ANY DAMAGE RECOVERED AFTER THE CREATOR'S DEATH SHALL BE HELD IN TRUST FOR AND REMITTED TO HIS HEIRS, AND IN DEFAULT OF THE HEIRS, SHALL BELONG TO THE GOVERNMENT. (SEC. 40, P. D. NO. 49)

ADDITION, DAMAGES WHICH MAY BE AVAILED OF UNDER THE

CHAPTER XI RIGHTS TO PROCEEDS IN SUBSEQUENT TRANSFERS SEC. 200. SALE OR LEASE OF WORK. - IN EVERY SALE OR LEASE OF AN ORIGINAL WORK OF PAINTING OR SCULPTURE OR OF THE ORIGINAL MANUSCRIPT OF A WRITER OR COMPOSER, SUBSEQUENT TO THE FIRST DISPOSITION THEREOF BY THE AUTHOR, THE AUTHOR OR HIS HEIRS SHALL HAVE AN INALIENABLE RIGHT TO PARTICIPATE IN THE GROSS PROCEEDS OF THE SALE OR

(5%). THIS RIGHT SHALL (50) YEARS AFTER HIS DEATH. (SEC. 31, P. D. NO. 49)

LEASE TO THE EXTENT OF FIVE PERCENT FIFTY

SEC. 201. WORKS NOT COVERED. - THE PROVISIONS OF ENGRAVINGS, WORKS OF APPLIED ART, OR WORKS OF SIMILAR THE PROCEEDS OF REPRODUCTIONS. (SEC. 33, P. D. NO. 49)

EXIST DURING THE LIFETIME OF THE AUTHOR AND FOR

THIS

CHAPTER

SHALL NOT APPLY TO PRINTS, ETCHINGS,

KIND WHEREIN THE AUTHOR PRIMARILY DERIVES GAIN FROM

CHAPTER XII RIGHTS OF PERFORMERS, PRODUCERS OF SOUNDS RECORDINGS AND BROADCASTING ORGANIZATIONS Neighboring Rights – performer’s rights are also called “neighboring rights.” This is because when a song composed by X, and is performed by Y is produced, it is X, as the composer, who has the copyright. Y has no copyright. He did not create the song, he just interpreted it. His right is to his interpretation, a neighboring right to the copyright of the composer. Berne Convention – prescribed the rights of creators TRIPS Agreement – here, performer’s rights are called “related rights”

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So 1. 2. 3.

when you record the rendition of Nick Carter of Baby Face’s song “Take a Bow,” you violate three rights: composer – the copyright performer – the neighboring rights broadcaster – his neighboring rights

NOTE: ATTY. LIM SAYS,

STUDY SCOPE OF PERFORMER’S AND PRODUCER’S RIGHTS, WILL COME OUT IN THE EXAM.

SEC. 202. DEFINITIONS. - FOR

THE PURPOSE OF THIS

ACT,

THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING

MEANINGS:

202.1. "PERFORMERS" ARE ACTORS, SINGERS, MUSICIANS, DANCERS, AND OTHER PLAY IN, INTERPRET, OR OTHERWISE PERFORM LITERARY AND ARTISTIC WORK;

202.2. "SOUND RECORDING" REPRESENTATION OF SOUND, OTHER AUDIOVISUAL WORK;

PERSONS WHO ACT, SING, DECLAIM,

MEANS THE FIXATION OF THE SOUNDS OF A PERFORMANCE OR OF OTHER SOUNDS, OR OTHER THAN IN THE FORM OF A FIXATION INCORPORATED IN A CINEMATOGRAPHIC OR

202.3. AN "AUDIOVISUAL WORK OR FIXATION"

IS A WORK THAT CONSISTS OF A SERIES OF RELATED IMAGES WHICH

IMPART THE IMPRESSION OF MOTION, WITH OR WITHOUT ACCOMPANYING SOUNDS, SUSCEPTIBLE OF BEING MADE VISIBLE AND, WHERE ACCOMPANIED BY SOUNDS, SUSCEPTIBLE OF BEING MADE AUDIBLE;

202.4. "FIXATION"

MEANS THE EMBODIMENT OF SOUNDS, OR OF THE REPRESENTATIONS THEREOF, FROM WHICH THEY

CAN BE PERCEIVED, REPRODUCED OR COMMUNICATED THROUGH A DEVICE;

202.5. "PRODUCER OF A SOUND RECORDING"

MEANS THE PERSON, OR THE LEGAL ENTITY, WHO OR WHICH TAKES THE

INITIATIVE AND HAS THE RESPONSIBILITY FOR THE FIRST FIXATION OF THE SOUNDS OF A PERFORMANCE OR OTHER SOUNDS, OR THE REPRESENTATION OF SOUNDS;

202.6. "PUBLICATION OF A FIXED PERFORMANCE OR A SOUND RECORDING" MEANS THE OFFERING OF COPIES OF THE FIXED PERFORMANCE OR THE SOUND RECORDING TO THE PUBLIC, WITH THE CONSENT OF THE RIGHT HOLDER: PROVIDED, THAT COPIES ARE OFFERED TO THE PUBLIC IN REASONABLE QUALITY; 202.7. "BROADCASTING"

MEANS THE TRANSMISSION BY WIRELESS MEANS FOR THE PUBLIC RECEPTION OF SOUNDS OR

OF IMAGES OR OF REPRESENTATIONS THEREOF; SUCH TRANSMISSION BY SATELLITE IS ALSO "BROADCASTING" WHERE THE MEANS FOR DECRYPTING ARE PROVIDED TO THE PUBLIC BY THE BROADCASTING ORGANIZATION OR WITH ITS CONSENT;

202.8. "BROADCASTING ORGANIZATION" AUTHORIZED TO ENGAGE IN BROADCASTING;

SHALL INCLUDE A NATURAL PERSON OR A JURIDICAL ENTITY DULY AND

202.9. "COMMUNICATION TO THE PUBLIC OF A PERFORMANCE OR A SOUND RECORDING" MEANS THE TRANSMISSION TO THE PUBLIC, BY ANY MEDIUM, OTHERWISE THAN BY BROADCASTING, OF SOUNDS OF A PERFORMANCE OR THE REPRESENTATIONS OF SOUNDS FIXED IN A SOUND RECORDING. FOR PURPOSES OF SECTION 209, "COMMUNICATION TO THE PUBLIC" INCLUDES MAKING THE SOUNDS OR REPRESENTATIONS OF SOUNDS FIXED IN A SOUND RECORDING AUDIBLE

TO THE PUBLIC.

SEC. 203. SCOPE OF PERFORMERS' RIGHTS. - SUBJECT

TO THE PROVISIONS OF

SECTION 212,

PERFORMERS SHALL ENJOY

THE FOLLOWING EXCLUSIVE RIGHTS:

203.1. AS REGARDS THEIR PERFORMANCES, THE RIGHT OF AUTHORIZING: (A) THE BROADCASTING AND OTHER COMMUNICATION TO THE PUBLIC OF THEIR PERFORMANCE;

AND

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(B) THE FIXATION OF THEIR UNFIXED PERFORMANCE. 203.2. THE

RIGHT OF AUTHORIZING THE DIRECT OR INDIRECT REPRODUCTION OF THEIR PERFORMANCES FIXED IN

SOUND RECORDINGS, IN ANY MANNER OR FORM;

203.3. SUBJECT TO THE PROVISIONS OF SECTION 206,

THE RIGHT OF AUTHORIZING THE FIRST PUBLIC DISTRIBUTION

OF THE ORIGINAL AND COPIES OF THEIR PERFORMANCE FIXED IN THE SOUND RECORDING THROUGH SALE OR RENTAL OR OTHER FORMS OF TRANSFER OF OWNERSHIP;

203.4. THE RIGHT OF AUTHORIZING THE COMMERCIAL RENTAL TO THE PUBLIC OF THE ORIGINAL AND COPIES OF THEIR PERFORMANCES FIXED IN SOUND RECORDINGS, EVEN AFTER DISTRIBUTION OF THEM BY, OR PURSUANT TO THE AUTHORIZATION BY THE PERFORMER; AND

203.5. THE RIGHT OF AUTHORIZING THE MAKING AVAILABLE TO THE PUBLIC OF THEIR PERFORMANCES FIXED IN SOUND RECORDINGS, BY WIRE OR WIRELESS MEANS, IN SUCH A WAY THAT MEMBERS OF THE PUBLIC MAY ACCESS THEM FROM A PLACE AND TIME INDIVIDUALLY CHOSEN BY THEM.

SEC. 204. MORAL RIGHTS OF PERFORMERS. 204.1. INDEPENDENTLY OF A PERFORMER'S

ECONOMIC RIGHTS, THE PERFORMER, SHALL, AS REGARDS HIS LIVE AURAL

PERFORMANCES OR PERFORMANCES FIXED IN SOUND RECORDINGS, HAVE THE RIGHT TO CLAIM TO BE IDENTIFIED AS THE PERFORMER OF HIS PERFORMANCES, EXCEPT WHERE THE OMISSION IS DICTATED BY THE MANNER OF THE USE OF THE PERFORMANCE, AND TO OBJECT TO ANY DISTORTION, MUTILATION OR OTHER MODIFICATION OF HIS PERFORMANCES THAT WOULD BE PREJUDICIAL TO HIS REPUTATION.

204.2. THE RIGHTS GRANTED TO A PERFORMER IN ACCORDANCE WITH SUBSECTION 203.1 SHALL BE MAINTAINED AND EXERCISED FIFTY (50) YEARS AFTER HIS DEATH, BY HIS HEIRS, AND IN DEFAULT OF HEIRS, THE GOVERNMENT, WHERE PROTECTION IS CLAIMED. SEC. 205. LIMITATION ON RIGHT. 205.1. SUBJECT TO THE PROVISIONS OF SECTION 206, ONCE THE PERFORMER HAS AUTHORIZED THE BROADCASTING OR FIXATION OF HIS PERFORMANCE, THE PROVISIONS OF SECTIONS 203 SHALL HAVE NO FURTHER APPLICATION. 205.2. THE PROVISIONS OF SECTION 184 AND SECTION 185 SHALL APPLY MUTATIS MUTANDIS TO PERFORMERS. (N) SEC. 206. ADDITIONAL REMUNERATION FOR SUBSEQUENT COMMUNICATIONS OR BROADCASTS. - UNLESS OTHERWISE PROVIDED IN THE CONTRACT, IN EVERY COMMUNICATION TO THE PUBLIC OR BROADCAST OF A PERFORMANCE SUBSEQUENT TO THE FIRST COMMUNICATION OR BROADCAST THEREOF BY THE BROADCASTING ORGANIZATION, THE PERFORMER SHALL BE ENTITLED TO AN ADDITIONAL REMUNERATION EQUIVALENT TO AT LEAST FIVE PERCENT (5%) OF THE ORIGINAL COMPENSATION HE OR SHE RECEIVED FOR THE FIRST COMMUNICATION OR BROADCAST. (N) SEC. 207. CONTRACT TERMS. - NOTHING IN THIS CHAPTER SHALL BE CONSTRUED TO DEPRIVE PERFORMERS OF THE RIGHT TO AGREE BY CONTRACTS ON TERMS AND CONDITIONS MORE FAVORABLE FOR THEM IN RESPECT OF ANY USE OF THEIR PERFORMANCE. (N)

CHAPTER XIII PRODUCERS OF SOUND RECORDINGS SEC. 208. SCOPE OF RIGHT. - SUBJECT

TO THE PROVISIONS OF

SECTION 212,

PRODUCERS OF SOUND RECORDINGS SHALL

ENJOY THE FOLLOWING EXCLUSIVE RIGHTS:

208.1. THE

RIGHT TO AUTHORIZE THE DIRECT OR INDIRECT REPRODUCTION OF THEIR SOUND RECORDINGS, IN ANY

MANNER OR FORM; THE PLACING OF THESE REPRODUCTIONS IN THE MARKET AND THE RIGHT OF RENTAL OR LENDING;

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208.2. THE

RIGHT TO AUTHORIZE THE FIRST PUBLIC DISTRIBUTION OF THE ORIGINAL AND COPIES OF THEIR SOUND

RECORDINGS THROUGH SALE OR RENTAL OR OTHER FORMS OF TRANSFERRING OWNERSHIP; AND

208.3. THE

RIGHT TO AUTHORIZE THE COMMERCIAL RENTAL TO THE PUBLIC OF THE ORIGINAL AND COPIES OF THEIR

SOUND RECORDINGS, EVEN AFTER DISTRIBUTION BY THEM BY OR PURSUANT TO AUTHORIZATION BY THE PRODUCER.

SEC. 209. COMMUNICATION TO THE PUBLIC. - IF

A SOUND RECORDING PUBLISHED FOR COMMERCIAL PURPOSES, OR A

REPRODUCTION OF SUCH SOUND RECORDING, IS USED DIRECTLY FOR BROADCASTING OR FOR OTHER COMMUNICATION TO THE PUBLIC, OR IS PUBLICLY PERFORMED WITH THE INTENTION OF MAKING AND ENHANCING PROFIT, A SINGLE EQUITABLE REMUNERATION FOR THE PERFORMER OR PERFORMERS, AND THE PRODUCER OF THE SOUND RECORDING SHALL BE PAID BY THE USER TO BOTH THE PERFORMERS AND THE PRODUCER, WHO, IN THE ABSENCE OF ANY AGREEMENT SHALL SHARE EQUALLY.

SEC. 210. LIMITATION OF RIGHT. - SECTIONS 184 RECORDINGS.

AND

185

SHALL APPLY MUTATIS MUTANDIS TO THE PRODUCER OF SOUND

CHAPTER XIV BROADCASTING ORGANIZATIONS SEC. 211. SCOPE OF RIGHT. - SUBJECT

TO THE PROVISIONS OF

SECTION 212,

BROADCASTING ORGANIZATIONS SHALL

ENJOY THE EXCLUSIVE RIGHT TO CARRY OUT, AUTHORIZE OR PREVENT ANY OF THE FOLLOWING ACTS:

211.1. THE REBROADCASTING OF THEIR BROADCASTS; 211.2. THE

RECORDING IN ANY MANNER, INCLUDING THE MAKING OF FILMS OR THE USE OF VIDEO TAPE, OF THEIR

BROADCASTS FOR THE PURPOSE OF COMMUNICATION TO THE PUBLIC OF TELEVISION BROADCASTS OF THE SAME; AND

211.3. THE USE OF SUCH RECORDS FOR FRESH TRANSMISSIONS OR FOR FRESH RECORDING. CHAPTER XV LIMITATIONS ON PROTECTION SEC. 212. LIMITATIONS ON RIGHTS. - SECTIONS 203, 208 AND 209 SHALL NOT APPLY WHERE THE ACTS REFERRED TO IN THOSE SECTIONS ARE RELATED TO: 212.1. THE USE BY A NATURAL PERSON EXCLUSIVELY FOR HIS OWN PERSONAL PURPOSES; 212.2. USING SHORT EXCERPTS FOR REPORTING CURRENT EVENTS; 212.3. USE SOLELY FOR THE PURPOSE OF TEACHING OR FOR SCIENTIFIC RESEARCH; AND 212.4. FAIR USE OF THE BROADCAST SUBJECT TO THE CONDITIONS UNDER SECTION 185. CHAPTER XVI TERM OF PROTECTION SEC. 213. TERM OF PROTECTION. – 213.1. SUBJECT TO THE PROVISIONS OF SUBSECTIONS 213.2 TO 213.5, THE COPYRIGHT IN WORKS UNDER SECTIONS AND 173 SHALL BE PROTECTED DURING THE LIFE OF THE AUTHOR AND FOR FIFTY (50 YEARS AFTER HIS DEATH. THIS RULE ALSO APPLIES TO POSTHUMOUS WORKS.

172

213.2. IN

CASE OF WORKS OF JOINT AUTHORSHIP, THE ECONOMIC RIGHTS SHALL BE PROTECTED DURING THE LIFE OF

THE LAST SURVIVING AUTHOR AND FOR FIFTY (50) YEARS AFTER HIS DEATH.

213.3. IN

CASE OF ANONYMOUS OR PSEUDONYMOUS WORKS, THE COPYRIGHT SHALL BE PROTECTED FOR FIFTY

YEARS FROM THE DATE ON WHICH THE WORK WAS FIRST LAWFULLY PUBLISHED:

PROVIDED, THAT WHERE,

(50)

BEFORE THE

EXPIRATION OF THE SAID PERIOD, THE AUTHOR'S IDENTITY IS REVEALED OR IS NO LONGER IN DOUBT, THE PROVISIONS

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OF

SUBSECTIONS 213.1

AND

213.2

SHALL APPLY, AS THE CASE MAY BE:

PUBLISHED BEFORE SHALL BE PROTECTED FOR FIFTY

(50)

PROVIDED, FURTHER, THAT SUCH WORKS IF NOT

YEARS COUNTED FROM THE MAKING OF THE WORK.

213.4. IN CASE OF WORKS OF APPLIED ART THE PROTECTION SHALL BE FOR A PERIOD OF TWENTY-FIVE (25) THE DATE OF MAKING. 213.5. IN

CASE OF PHOTOGRAPHIC WORKS, THE PROTECTION SHALL BE FOR FIFTY

THE WORK AND, IF UNPUBLISHED, FIFTY

213.6. IN

(50)

(50)

YEARS FROM

YEARS FROM PUBLICATION OF

YEARS FROM THE MAKING.

CASE OF AUDIO-VISUAL WORKS INCLUDING THOSE PRODUCED BY PROCESS ANALOGOUS TO PHOTOGRAPHY OR

ANY PROCESS FOR MAKING AUDIO-VISUAL RECORDINGS, THE TERM SHALL BE FIFTY

(50)

YEARS FROM DATE OF

PUBLICATION AND, IF UNPUBLISHED, FROM THE DATE OF MAKING.

SEC. 214. CALCULATION OF TERM. - THE TERM OF PROTECTION SUBSEQUENT TO THE DEATH OF THE AUTHOR PROVIDED IN THE PRECEDING SECTION SHALL RUN FROM THE DATE OF HIS DEATH OR OF PUBLICATION, BUT SUCH TERMS SHALL ALWAYS BE DEEMED TO BEGIN ON THE FIRST DAY OF JANUARY OF THE YEAR FOLLOWING THE EVENT WHICH GAVE RISE TO THEM. SEC. 215. TERM OF PROTECTION FOR PERFORMERS, PRODUCERS AND BROADCASTING ORGANIZATIONS. 215.1. THE RIGHTS GRANTED TO PERFORMERS AND PRODUCERS OF SOUND RECORDINGS UNDER THIS LAW SHALL EXPIRE: (A) FOR PERFORMANCES NOT INCORPORATED IN RECORDINGS, FIFTY (50) YEARS FROM THE END OF THE YEAR IN WHICH THE PERFORMANCE TOOK PLACE; AND (B) FOR SOUND OR IMAGE AND SOUND RECORDINGS AND FOR PERFORMANCES INCORPORATED THEREIN, FIFTY (50) YEARS FROM THE END OF THE YEAR IN WHICH THE RECORDING TOOK PLACE. 215.2. IN CASE OF BROADCASTS, THE TERM SHALL BE TWENTY (20) YEARS FROM THE DATE THE BROADCAST TOOK PLACE. THE EXTENDED TERM SHALL BE APPLIED ONLY TO OLD WORKS WITH SUBSISTING PROTECTION UNDER THE PRIOR LAW. CHAPTER XVII INFRINGEMENT SEC. 216. REMEDIES FOR INFRINGEMENT. 216.1. ANY PERSON INFRINGING A RIGHT PROTECTED UNDER THIS LAW SHALL BE LIABLE: (A) TO AN INJUNCTION RESTRAINING SUCH INFRINGEMENT. THE COURT MAY ALSO ORDER THE DEFENDANT TO DESIST FROM AN INFRINGEMENT, AMONG OTHERS, TO PREVENT THE ENTRY INTO THE CHANNELS OF COMMERCE OF IMPORTED GOODS THAT INVOLVE AN INFRINGEMENT, IMMEDIATELY AFTER CUSTOMS CLEARANCE OF SUCH GOODS. (B) PAY TO THE COPYRIGHT PROPRIETOR OR HIS ASSIGNS OR HEIRS SUCH ACTUAL DAMAGES,

INCLUDING LEGAL

COSTS AND OTHER EXPENSES, AS HE MAY HAVE INCURRED DUE TO THE INFRINGEMENT AS WELL AS THE PROFITS THE INFRINGER MAY HAVE MADE DUE TO SUCH INFRINGEMENT, AND IN PROVING PROFITS THE PLAINTIFF SHALL BE REQUIRED TO PROVE SALES ONLY AND THE DEFENDANT SHALL BE REQUIRED TO PROVE EVERY ELEMENT OF COST WHICH HE CLAIMS, OR, IN LIEU OF ACTUAL DAMAGES AND PROFITS, SUCH DAMAGES WHICH TO THE COURT SHALL APPEAR TO BE JUST AND SHALL NOT BE REGARDED AS PENALTY.

(C) DELIVER

UNDER OATH, FOR IMPOUNDING DURING THE PENDENCY OF THE ACTION, UPON SUCH TERMS AND

CONDITIONS AS THE COURT MAY PRESCRIBE, SALES INVOICES AND OTHER DOCUMENTS EVIDENCING SALES, ALL ARTICLES AND THEIR PACKAGING ALLEGED TO INFRINGE A COPYRIGHT AND IMPLEMENTS FOR MAKING THEM.

(D) DELIVER UNDER OATH FOR DESTRUCTION WITHOUT ANY COMPENSATION ALL INFRINGING COPIES OR DEVICES, AS WELL AS ALL PLATES, MOLDS, OR OTHER MEANS FOR MAKING SUCH INFRINGING COPIES AS THE COURT MAY ORDER.

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(E) SUCH

OTHER TERMS AND CONDITIONS, INCLUDING THE PAYMENT OF MORAL AND EXEMPLARY DAMAGES,

WHICH THE COURT MAY DEEM PROPER, WISE AND EQUITABLE AND THE DESTRUCTION OF INFRINGING COPIES OF THE WORK EVEN IN THE EVENT OF ACQUITTAL IN A CRIMINAL CASE.

216. 2. IN

AN INFRINGEMENT ACTION, THE COURT SHALL ALSO HAVE THE POWER TO ORDER THE SEIZURE AND

IMPOUNDING OF ANY ARTICLE WHICH MAY SERVE AS EVIDENCE IN THE COURT PROCEEDINGS.

(SEC. 28, P. D. NO. 49A)

Infringement – doing an act pertaining to copyrighted works that one is not authorized to do. Elements/What must be Proven 1. act is unauthorized 2. copyright exists original 3. access (person knows or ought to know that work is copyrighted) 4. copying took place Q. No injury = no crime? A. Hmm… Seems like it. Q. Getting a search warrant in criminal cases. What do you want in SW? A. You want to: 1. Seize goods – seize the infringing copies so damage (lost sales) will stop immediately 2. Seize equipment used for reproduction 3. Seize documents to prove sales (to compute actual damages) and to find out his real source. SEC. 217. CRIMINAL PENALTIES. 217.1. ANY PERSON INFRINGING ANY RIGHT SECURED BY PROVISIONS OF PART IV OF THIS ACT OR AIDING OR ABETTING SUCH INFRINGEMENT SHALL BE GUILTY OF A CRIME PUNISHABLE BY: (A) IMPRISONMENT OF ONE (1) YEAR TO THREE (3) YEARS PLUS A FINE RANGING FROM FIFTY THOUSAND PESOS (P50,000) TO ONE HUNDRED FIFTY THOUSAND PESOS (P150,000) FOR THE FIRST OFFENSE. (B) IMPRISONMENT OF THREE (3) YEARS AND ONE (1) DAY TO SIX (6) YEARS PLUS A FINE RANGING FROM ONE HUNDRED FIFTY THOUSAND PESOS (P150,000) TO FIVE HUNDRED THOUSAND PESOS (P500,000) FOR THE SECOND OFFENSE. (C) IMPRISONMENT OF SIX (6) YEARS AND ONE (1) DAY TO NINE (9) YEARS PLUS A FINE RANGING FROM FIVE HUNDRED THOUSAND PESOS (P500,000) TO ONE MILLION FIVE HUNDRED THOUSAND PESOS (P1,500,000) FOR THE THIRD AND SUBSEQUENT OFFENSES. (D) IN ALL CASES, SUBSIDIARY IMPRISONMENT IN CASES OF INSOLVENCY. 217.2. IN

DETERMINING THE NUMBER OF YEARS OF IMPRISONMENT AND THE AMOUNT OF FINE, THE COURT SHALL

CONSIDER THE VALUE OF THE INFRINGING MATERIALS THAT THE DEFENDANT HAS PRODUCED OR MANUFACTURED AND THE DAMAGE THAT THE COPYRIGHT OWNER HAS SUFFERED BY REASON OF THE INFRINGEMENT.

217.3. ANY

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 PURPOSE OF:

(A) SELLING,

LETTING FOR HIRE, OR BY WAY OF TRADE OFFERING OR EXPOSING FOR SALE, OR HIRE, THE

ARTICLE;

(B) DISTRIBUTING

THE ARTICLE FOR 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, SHALL BE GUILTY OF AN OFFENSE AND SHALL BE LIABLE ON

CONVICTION TO IMPRISONMENT AND FINE AS ABOVE MENTIONED.

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Q. Is good faith a valid defense in copyright infringement? A. The law clearly provides when one does not know or it is impossible to know that the copy is infringed, good faith is a defense. However, only the act of possession can be protected with good faith. After the sale, there is no longer possession. Therefore, whether the person knows that the DVDs are counterfeit or not, he can be punished. It is true that the RPC provides that good faith (or mistake of fact) does not apply since the IP Code is a special law. Mistake of fact is a defense only in crimes mala in se. Violations of the IP Code are mala prohibitum. However, the IP code provides an

exception. N. B. It is thus very important to do controlled buys, in order to do away with the good faith defense. SEC. 218. AFFIDAVIT EVIDENCE. 218.1. IN AN ACTION UNDER THIS CHAPTER,

AN AFFIDAVIT MADE BEFORE A NOTARY PUBLIC BY OR ON BEHALF OF THE

OWNER OF THE COPYRIGHT IN ANY WORK OR OTHER SUBJECT MATTER AND STATING THAT:

(A) AT THE TIME SPECIFIED THEREIN, COPYRIGHT SUBSISTED IN THE WORK OR OTHER SUBJECT MATTER; (B) HE OR THE PERSON NAMED THEREIN IS THE OWNER OF THE COPYRIGHT; AND (C) THE COPY OF THE WORK OR OTHER SUBJECT MATTER ANNEXED THERETO IS A TRUE COPY THEREOF, SHALL BE ADMITTED IN EVIDENCE IN ANY PROCEEDINGS FOR AN OFFENSE UNDER THIS CHAPTER AND SHALL BE PRIMA FACIE PROOF OF THE MATTERS THEREIN STATED UNTIL THE CONTRARY IS PROVED, AND THE COURT BEFORE WHICH SUCH AFFIDAVIT IS PRODUCED SHALL ASSUME THAT THE AFFIDAVIT WAS MADE BY OR ON BEHALF OF THE OWNER OF THE COPYRIGHT.

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.

(C) WHERE THE DEFENDANT,

WITHOUT GOOD FAITH, PUTS IN ISSUE THE QUESTIONS OF WHETHER COPYRIGHT

SUBSISTS IN A WORK OR OTHER SUBJECT MATTER TO WHICH THE ACTION RELATES, OR THE OWNERSHIP OF COPYRIGHT IN SUCH WORK OR SUBJECT MATTER, THEREBY OCCASIONING UNNECESSARY COSTS OR DELAY IN THE PROCEEDINGS, THE COURT MAY DIRECT THAT ANY COSTS TO THE DEFENDANT IN RESPECT OF THE ACTION SHALL NOT BE ALLOWED BY HIM AND THAT ANY COSTS OCCASIONED BY THE DEFENDANT TO OTHER PARTIES SHALL BE PAID BY HIM TO SUCH OTHER PARTIES. (N)

SEC. 219. PRESUMPTION OF AUTHORSHIP. 219.1. THE NATURAL PERSON WHOSE NAME IS INDICATED ON A WORK IN THE USUAL MANNER AS THE AUTHOR SHALL, IN THE ABSENCE OF PROOF TO THE CONTRARY, BE PRESUMED TO BE THE AUTHOR OF THE WORK. THIS PROVISION SHALL BE APPLICABLE EVEN IF THE NAME IS A PSEUDONYM, WHERE THE PSEUDONYM LEAVES NO DOUBT AS TO THE IDENTITY OF THE AUTHOR. 219.2. THE PERSON OR BODY, CORPORATE WHOSE NAME APPEARS ON AN AUDIO-VISUAL WORK IN THE USUAL SHALL, IN THE ABSENCE OF PROOF TO THE CONTRARY, BE PRESUMED TO BE THE MAKER OF SAID WORK. (N) SEC. 220. INTERNATIONAL REGISTRATION OF WORKS. - A

MANNER

STATEMENT CONCERNING A WORK, RECORDED IN AN

INTERNATIONAL REGISTER IN ACCORDANCE WITH AN INTERNATIONAL TREATY TO WHICH THE

PHILIPPINES

IS OR MAY

BECOME A PARTY, SHALL BE CONSTRUED AS TRUE UNTIL THE CONTRARY IS PROVED EXCEPT:

220.1. WHERE PROPERTY.

THE STATEMENT CANNOT BE VALID UNDER THIS

ACT

OR ANY OTHER LAW CONCERNING INTELLECTUAL

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220.2. WHERE REGISTER.

THE STATEMENT IS CONTRADICTED BY ANOTHER STATEMENT RECORDED IN THE INTERNATIONAL

JOAQUIN V. DRILON Petitioner BJ Productions, Inc. was the holder/grantee of a Certificate of Copyright of Rhoda and Me, a dating game show aired from 1970 to 1977. On 1973, BJ Productions, Inc. submitted to the National Library an addendum to its Certificate of Copyright specifying the show's format and style of presentation. Sometime in 1991, BJ Productions, Inc. discovered that another television show, It's a Date, with a similar format to Rhoda and Me was being aired on RPN Channel 9. It's a Date was produced by IXL Productions, Inc. BJ Productions, Inc. then wrote a letter to the president of IXL Productions, Inc. Informing them that BJ Productions, Inc. had a copyright to Rhoda and Me and demanding that IXL Productions, Inc. discontinue airing It's a Date. IXL Productions, Inc. sought a meeting with BJ Productions, but nevertheless continued airing It's a Date. Meanwhile, IXL Productions, Inc. sought to register IXL's copyright to the first episode of It's a Date for which it was issued by the National Library a Certificate of Copyright on 14 August 1991. Upon complaint of BJ Productions, Inc., an information for violation of P.D. No.49 was filed against the officers of IXL Productions, Inc. and RPN Channel 9. However, upon the petition of IXL Productions, Inc., the complaint was eventually dismissed Secretary of Justice Franklin Drilon. BJ Productions, Inc. then filed a petition with the Supreme Court questioning this decision of Secretary Drilon. Respondents dismissed the case on the ground that petitioners had failed to establish probable cause because of their failure to present the copyrighted master tapes of Rhoda and Me. Petitioners, on the other hand, claim that the presentation of the master tapes was not necessary, since written descriptions of the formats of the two television shows were presented during the preliminary investigation. It was also from these descriptions that the investigating prosecutor found substantial similarities and ruled that there was indeed infringement of copyright, as the two shows were practically exact copies of the other. Respondents in this case also contend that BJ Production, Inc.'s copyright covers only a specific episode of Rhoda and Me and that the formats or concepts of dating game shows are not covered by copyright protection under P .D. No.49. Petitioners, on the other hand, asserted that the format of Rhoda and Me is a product of ingenuity and skill and is thus entitled to copyright protection.

Held: The format of a show is not copyrightable. Section 2 of P.D. No.49 enumerates the classes of work entitled to copyright protection. Notably, the format or mechanics of a television show is not included in this list of protected works. Copyright, being a statutory right, the right is 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. For this reason, the protection afforded by the law cannot be extended to cover them. Section 2 of P.D. No.49, in enumerating what are subject to copyright, refers to finished works and not to concepts. The copyright does not extend to an idea, procedure, process, system, method of operation, concept, principle, or discovery, regardless of the form in which it is described, explained, illustrated, or embodied in such work48. No protection shall extend to any idea, procedure, system, method or operation, concept, principle, discovery or mere data, as such, even if they are expressed, explained, illustrated or embodied in a work49. It is therefore clear that under law, the format of a dating game show falls under what is referred to as "unprotected subject matter". BJ Production, Inc.'s copyright covers only the audio-visual recordings of each episode of Rhoda and Me, as falling within the class of works mentioned in Section 2 of P.D. No.49, to wit: cinematographic works and works produced by a process analogous to cinematography or any process for making audio-visual recordings. This being th8' case, the Court ruled that the master tape should have been presented to provide the investigating prosecutor the opportunity to compare the videotapes of the two shows. The Court held that Mere description by words of the general format of the two dating game shows is insufficient; the presentation of the master videotape in evidence was indispensable to the determination of the existence of probable cause. As aptly observed by respondent Secretary of Justice: A television show includes more than mere words can describe because it involves a whole spectrum of visuals and effects, video and audio, such that no similarity or dissimilarity may be found by merely describing the general copyright! format of both dating game shows.

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Joaquin v. Drilon – It is very difficult to prove reproduction of plays and shows unless there is EXACT copying. HABANA V. ROBLES This case involves the question of plagiarism and the possible infringement of copyrighted materials in a textbook. Petitioners Pacita Habana, Alicia Cinco and Jovita Fernando are the authors and copyright owner.s of duly issued certificates of copyright registration covering their published works, College English for Today, Books 1 and 2, and Workbook for College Freshman English, Series 1. Respondents Felicidad Robles and Goodwill Trading Co., Inc. are the author/publisher and distributor/seller of another published work entitled "Developing English Proficiency", Books 1 and 2, which book was covered by copyrights issued to them. In the course of revising their published works, petitioners discovered that respondent's books were strikingly to the contents, scheme or presentation, illustrations and illustrative examples in their own book. Petitioners found that several pages of the respondent's book are similar, if not all together a copy of petitioner's book, which is a case of plagiarism and copyright infringement. After their demand that respondent pay damages and cease and desist from selling the infringing copies of respondent's book went unheeded, petitioners filed a compliant for infringement and unfair competition against the respondent.

Held: Respondent's act of lifting from the book of petitioners substantial portions of discussions and examples, and her failure to acknowledge the same in her book is an infringement of petitioner's copyright. As to substantial reproduction of a book, it does not necessarily require that the entire copyrighted work, or even a large portion of it, be copied. If so much is taken that the value of the original work is substantially diminished, there is an infringement of copyright and to an injurious extent, the work is appropriated. In determining the question of infringement, the amount of matter copied from the copyrighted work, is an important consideration. To constitute infringement, it is not necessary that the whole or even a large portion of the work shall have been copied. If so much is taken that the value of the original is sensibly diminished, or the labours of the original author are substantially and to an injurious extent appropriated by another, that is sufficient in point of law to constitute piracy. The essence of intellectual piracy should be essayed in conceptual terms in order to underscore its gravity by an appropriate understanding thereof. Infringement of a copyright is a trespass on a private domain owned and occupied by the owner of the copyright, and, therefore, protected by law, and infringement of copyright, or piracy, which is a synonymous term in this connection, consists in the doing by any person, without the consent of the owner of the copyright, of anything the sole right to do [is conferred by statute on the owner of the copyright On the respondent's claim that the copied portions of the book do not constitute copyright infringement since these are also found in foreign books and other grammar books and that the similarity between their styles can not be avoided since they come from the same background and orientation, the Supreme Court held that this would be true had the respondent mentioned the source and the name of the author in her book.

Thus, a copy of a piracy is an infringement of the original, and it is no defense that the pirate, in such cases, did not know whether or not he was infringing any copyright; he at least knew that what he was copying was not his, and he copied at his peril52. Nevertheless, one who copies or quotes from a published work will not be held to be guilty of copyright infringement where he mentions the source and the name of the author of the published work. To what extent can copying be injurious to the author of the book being copied? In this case, the Court held that the fact that the numerous pages that the petitioners presented showing similarity in the style and the manner the books were presented and the identical examples is a mark of copying and cannot pass as similarities. Also, even if the petitioners and the respondent were of the same background in terms of teaching and orientation, the Court held that it was not an excuse for them to be identical even in the examples contained in their books. Lastly, the Court found indicia of guilt on the part of the respondent. In this case, the Court found that the respondent had pulled out from Goodwill bookstores her book upon learning of petitioners' complaint while denying petitioners' demand. The Court further noted that when the respondent's book was re-issued as

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a revised version, all the pages cited by petitioners to contain portion of their book were conspicuously eliminated. In cases of infringement, copying alone is not what is prohibited. The copying must produce an "injurious effect". Here the injury consists in that respondent Robles lifted from petitioners' book materials that were the result of the latter's research work and compilation and misrepresented them as her own. She circulated the book DEP for commercial use and did not acknowledge petitioners as her source. Hence, there is a clear case of appropriation of copyrighted work for her benefit that respondent Robles committed. Petitioner's work as authors is the product of their long and assiduous research and for another to represent it as her own is injury enough. In copyrighting books the purpose is to give protection to the intellectual product of an author. This is precisely what the law on copyright protected.

Q. HABANA – civil case; Joaquin – criminal case; Why? A. In computer CD crimes – you need immediate relief, that is, seizure of products so you can stop sales and your loss of profits. In TV shows, civil case maybe because it’s harder to prove anyway and no immediate relief can be obtained. Injunction is all that you can get. Q. A provincial cable company without license to broadcast Star Channels picked out the signal and broadcasted. What action would you recommend? A. Criminal, so you can seize broadcast equipment. If you file civil case and get an injunction, by the time you get it, equipment would have been moved and they would be broadcasting from a different office. You need to get the equipment fast. Administrative cases Filed against manufacturers AND retailers. Q. Jurisdiction? A. 200K above – Intellectual Property Office 200K below – DTI’s Bureau of Trade Regulation and Consumer Protection. Q. Could you give me the basic provisions governing administrative cases? A. (In the immortal words of Johnbee Sison) Certainly. RULES AND REGULATIONS ON ADMINISTRATIVE COMPLAINTS FOR VIOLATION OF LAWS INVOLVING INTELLECTUAL PROPERTY RIGHTS Rule 1 DEFINITIONS, INTERPRETATION, RULES OF COURT Sec. 2. Interpretation. — These Regulations shall be liberally construed to carry out the objectives of the IP Code and IP Laws and to assist the parties in obtaining just and expeditious settlement or disposition of administrative cases filed before the Office. Rule 2 COMMENCEMENT OF ACTION Section 1. Complaint, When and to Whom Filed. — All administrative complaints for violation of the IP Code or IP Laws shall be commenced by filing a verified complaint with the Bureau1 within four (4) years from the date of commission of the violation, or if the date be unknown, from the date of discovery of the violation.

1

Bureau of Legal Affairs of the IPO.

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The complaint shall include a certification that the party commencing the action has not filed any other action or proceeding involving the same issue or issues before any tribunal or agency nor such action or proceeding is pending in other quasi-judicial bodies: Provided, however, that if any such action is pending, the status of the same must be stated, and should knowledge thereof be acquired after the filing of the complaint…. Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or other initiatory pleading but shall be cause for dismissal of the case without prejudice. Sec. 2. Original Jurisdiction. — (a) The Bureau shall have original jurisdiction in administrative actions for violations of laws involving intellectual property rights where the total damages claimed are not less than two hundred thousand pesos (P200,000.00); Provided however, that availment of the provisional remedies may be granted in accordance with these Regulations and the provisions of the Rules of Court; The Director shall coordinate with local enforcement agencies for the strict and effective implementation and enforcement of these Regulations. The commencement of the action under these Rules and Regulations is independent and without prejudice to the filing of any action with the regular courts. Rule 3 POWERS OF HEARING OFFICERS Section 1. Powers of Hearing Officers. — (a) A Hearing Officer conducting the hearing and investigating shall be empowered to administer oaths and affirmations; issue subpoena and subpoena duces tecum to compel attendance of parties and witnesses and the production of any book, paper, document, correspondence and other records which are material to the case; grant provisional remedies in accordance with these Regulations and the Rules of Court; and make preliminary rulings on questions raised at the hearings, with the ultimate decision on the merits of all the issues involved being left to the Director. Rule 4 PRELIMINARY ATTACHMENT Rule 5 PRELIMINARY INJUNCTION Rule 6 CONTEMPT Rule 7 CALENDAR AND ADJOURNMENTS Rule 8 DEPOSITIONS AND DISCOVERIES Rule 9 HEARING

Rule 10 EVIDENCE Section 1. Evidence Required. — Substantial evidence shall be sufficient to support decision or order. A fact may be deemed established if it is supported by substantial evidence. It means such relevant evidence which a reasonable mind might accept as adequate to support or justify a conclusion. Rule 11 DECISIONS AND ORDERS

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Section 1. Rendition of Decision. — (a) The case is deemed submitted for resolution upon termination of the period for reception of evidence provided in Section 1 of Rule 9 and the evidence formally offered. Whether or not the parties submit a final pleading such as memorandum, the case shall be decided by the Bureau within thirty (30) calendar days from submission as provided herein. All decisions determining the merits of cases shall be in writing, stating clearly and distinctly the facts and law on which they are based and signed by the Director. (b) Decisions and final orders shall be saved by mail, personal service or publication as the case may require. Rule 12 ADMINISTRATIVE PENALTIES AND SANCTIONS Section 1. Administrative Penalties Imposable. — After formal investigation, the Director, may impose one (1) or more of the following administrative penalties: (a) Issuance of a cease and desist order which shall specify the acts that the respondent shall cease and desist from and shall require him to submit a compliance report.… (b) The acceptance of a voluntary assurance of compliance or discontinuance as may be imposed. (c) The condemnation or seizure of products which are subject of the offense. (d) The forfeiture of paraphernalia and all real and personal properties which have been used in the commission of the offense. (e) The imposition of administrative fines in such amount as deemed reasonable by the Director, which shall in no case be less than P5,000.00 (f) The cancellation of any permit, license, authority, or registration which may have been granted by the Office, or the suspension of the validity thereof not exceeding one (1) year. (g) The withholding of any permit, license, authority or registration which is being secured by the respondent from the Office; (h) The assessment and award of damages; (i) Censure Rule 13 JUDGMENTS, FINAL ORDERS AND ENTRY THEREOF Section 1. Rendition of Judgment and Final Orders. — A judgment or final order determining the merits of the case shall be in writing, stating clearly and distinctly the facts and the law on which it is based, signed by the Director, and filed with the appropriate Register of the Office. Sec. 2. Entry of judgments and Final Orders. — If no appeal is filed within the time provided in these Regulations, the Director shall forthwith cause the entry of the judgment or final order in the appropriate Register of the Office. The date of finality of the judgment or final order shall be deemed to be the date of its entry. The record shall contain the dispositive part of the judgment or final order and shall be signed by the Director, with a certificate that such judgment or final order has become final and executory. Rule 14 APPEAL Section 1. Finality of Decision and Order. — (a) The decision and order of the Director shall become final and executory fifteen (15) days after the receipt of a copy thereof by the party affected unless within the said period an appeal to the Director General has been perfected.

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(b) Decisions of the Director-General shall be final and executory unless an appeal to the Court of Appeals or Supreme Court is perfected in accordance with the Rules of Court applicable to appeals from decision of Regional Trial Courts. (d) No motion for reconsideration of the decision of the Director General shall be allowed. Sec. 2. Appeal, How Perfected. — Appeal may be perfected by filing a Notice of Appeal with the Director General and the Director and a copy thereof served upon the adverse party within fifteen (15) days from receipt of the order or Decision and upon payment of the corresponding docket fee.

Q. Can administrative agencies impose damages? A. Yes. There is no limit as to the amount of damages it may award. But it may not impose imprisonment. Q. What kind of determination does the agency make, does it determine guilt? A. Yes! Without a determination of guilt (or at least, violation), it can’t impose penalties. Q. Describe the appeals process. A. Administrative Agency (Bureau

Director)

CA

SC

Q. Is there any disadvantage in filing the case with an administrative agency? A. Yes. Administrative agencies are hesitant to award large amounts of damages, since this is the court’s job, and also because the losing party can file an administrative case against him in the Sandiganbayan for malfeasance. In this case, the government does not defend him. So he is hesitant even to grant temporary relief like injunctions. Q. Why would you file a case with an administrative agency rather than regular courts? A. to make sure that the IP issues are appreciated. But if case is clear cut, go to RTC. Decisions of the RTC have more weight because administrative cases are summary and is not bound by the technical rules on evidence. There is more chance that the IPO case will be reversed on appeal. Q. What kind of cases does the IPO hear? A. IP code cases. But RTC hears all sorts of cases, so they have lesser competence as to IP laws. Note that in major cities though, there are some courts assigned to hear only IP cases.

Criminal

Summary of Crim/Civ/Admi Pros and Cons Civil

• Hardest to prove – requires proof beyond reasonable doubt. Note that in software piracy, this is easier because there is an actual 100% reproduction • Immediate relief is needed by seizure of means of production. So even if case goes on for 20 years, he can’t manufacture fakes • Most expensive for the client because you pay trademark investigators to do the test purchases, so police will file for SW. At the Prelim Inves stage, accused will quash SW to claim that evidence obtained is inadmissible. Will also question finding

• File this when you have to prove substantial copying (case is not 100% copying) and when there is possibility that fair use will be raised as a defense • It takes VERY long to get an injunction so if you need immediate relief, don’t file this. • Not as expensive for the client. • The entire battle is fought at the getting of the injunction. Bulk of the evidence is presented here. If no injunction is obtained, it will be simple matter for the other party to keep extending the case (and keep selling pirated stuff while case is pending)

Administrative

• File this only when your case is against retailers and you don’t expect to obtain substantial damages.

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of probable cause by fiscal to DOJ • Important to pay for storage so evidence seized will not be lost.

Delivery under oath – can be done even in civil cases, so no need to get seizure in civil case - to get documents evidencing a) sourcing of goods (to get the big cat) b) sales (to prove amount of actual damages) Civil ex parte searches and seizures – provided for in the TRIPS Agreement did not specify if for civil, criminal, or administrative suits purposes 1) to prevent evidence from disappearing 2) to prevent infringed goods from entering the commerce of man Developing Countries – criminal cases already allow ex parte searches should be available in civil cases also called the “Anton Pillar” order – allows goods to be searched and seized which are subject of criminal action without need of filing criminal case apply for it in customs and go there (port) and seize Q. Is possession of copyrighted goods punishable? A. No. But it is criminally punished when it falls under Sec. 217.3 and possessor knows or ought to know that such is copyrighted. Note thought that it is hard to overcome presumption of this knowledge that work is copyrighted. Q. Does the doctrine of exhaustion of administrative relief apply? Do you have to file administrative case before you file civil/criminal case? A. No. You can file any case, civil, administrative or criminal. CHAPTER XVIII SCOPE OF APPLICATION SEC. 221. POINTS OF ATTACHMENT FOR WORKS UNDER SECTIONS 172 AND 173. 221.1. THE PROTECTION AFFORDED BY THIS ACT TO COPYRIGHTABLE WORKS UNDER SECTIONS 172 AND 173 SHALL APPLY TO: (A) WORKS OF AUTHORS WHO ARE NATIONALS OF, OR HAVE THEIR HABITUAL RESIDENCE IN THE PHILIPPINES; (B) AUDIO-VISUAL WORKS THE PRODUCER OF WHICH HAS HIS HEADQUARTERS OR HABITUAL RESIDENCE IN THE PHILIPPINES; (C) WORKS OF ARCHITECTURE ERECTED IN THE PHILIPPINES OR OTHER ARTISTIC WORKS INCORPORATED IN A BUILDING OR OTHER STRUCTURE LOCATED IN THE PHILIPPINES; (D) WORKS FIRST PUBLISHED IN THE PHILIPPINES; AND (E) WORKS FIRST PUBLISHED IN ANOTHER COUNTRY BUT ALSO PUBLISHED IN THE PHILIPPINES WITHIN THIRTY DAYS, IRRESPECTIVE OF THE NATIONALITY OR RESIDENCE OF THE AUTHORS. 221.2. THE PROVISIONS OF THIS ACT SHALL ALSO APPLY TO WORKS THAT ARE TO BE PROTECTED BY VIRTUE OF AND IN ACCORDANCE WITH ANY INTERNATIONAL CONVENTION OR OTHER INTERNATIONAL AGREEMENT TO WHICH THE

PHILIPPINES IS A PARTY. (N) Q. Should the author be the one to cause the publication of the work for his work to obtain protection? A. No. The law does not make a distinction. Q. A book is published in China by a Chinese. Is it possible for him to obtain protection in RP?

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A. Yes. He should publish in RP within 30 days. He does not need to be a Filipino or a resident of RP to obtain the protection. Q. What if you are not able to publish within the 30 day window, can you ever obtain protection? A. Yes. If you are a national of a country which ratified the TRIPS or the Berne Convention, the treaty provisions require that protection be extended to all citizens of signatory countries. Therefore, if you publish in Japan, you are automatically given protection in RP. Q. What if you publish in a non-member country like China, and you miss the 30 day window in the Philippines? How can you obtain copyright protection in TRIPS or Berne Convention signatory countries? A. Simply publish in a country which ratified the TRIPS but allows for longer period for publication than 30 days. SEC. 222. POINTS OF ATTACHMENT FOR PERFORMERS. - THE PROVISIONS OF THIS ACT ON THE PROTECTION OF PERFORMERS

SHALL APPLY TO:

222.1. PERFORMERS WHO ARE NATIONALS OF THE PHILIPPINES; 222.2. PERFORMERS WHO ARE NOT NATIONALS OF THE PHILIPPINES BUT WHOSE PERFORMANCES: (A) TAKE PLACE IN THE PHILIPPINES; OR (B) ARE INCORPORATED IN SOUND RECORDINGS THAT ARE PROTECTED UNDER THIS ACT; OR (C) WHICH HAS NOT BEEN FIXED IN SOUND RECORDING BUT ARE CARRIED BY BROADCAST PROTECTION UNDER THIS ACT. (N) SEC. 223. POINTS OF ATTACHMENT FOR SOUND RECORDINGS. - THE PROVISIONS OF THIS ACT ON SOUND RECORDINGS SHALL APPLY TO: 223.1. SOUND RECORDINGS THE PRODUCERS OF WHICH ARE NATIONALS OF THE PHILIPPINES; AND 223.2. SOUND RECORDINGS THAT WERE FIRST PUBLISHED IN THE PHILIPPINES. (N)

QUALIFYING FOR

THE PROTECTION OF

SEC. 224. POINTS OF ATTACHMENT FOR BROADCASTS. 224.1. THE PROVISIONS OF THIS ACT ON THE PROTECTION OF BROADCASTS SHALL APPLY TO: (A) BROADCASTS OF BROADCASTING ORGANIZATIONS THE HEADQUARTERS OF WHICH ARE SITUATED IN THE PHILIPPINES; AND (B) BROADCASTS TRANSMITTED FROM TRANSMITTERS SITUATED IN THE PHILIPPINES. 224.2. THE PROVISIONS OF THIS ACT SHALL ALSO APPLY TO PERFORMERS WHO, AND TO PRODUCERS OF SOUND RECORDINGS AND BROADCASTING ORGANIZATIONS WHICH, ARE TO BE PROTECTED BY VIRTUE OF AND IN ACCORDANCE WITH ANY INTERNATIONAL CONVENTION OR OTHER INTERNATIONAL AGREEMENT TO WHICH THE PHILIPPINES IS A PARTY. (N) N. B.

United States is a first to register jurisdiction. You obtain copyright by registration. RP is a first to create jurisdiction. You obtain copyright by virtue of creation. The Berne Convention reinforces the first to create doctrine. US is not a signatory of the Berne. CHAPTER XIX INSTITUTION OF ACTIONS

SEC. 225. JURISDICTION. - WITHOUT PREJUDICE TO THE PROVISIONS OF SUBSECTION 7.1(C),

ACTIONS UNDER THIS

ACT

SHALL BE COGNIZABLE BY THE COURTS WITH APPROPRIATE JURISDICTION UNDER EXISTING LAW.

SEC. 226. DAMAGES. - NO DAMAGES MAY BE RECOVERED UNDER THIS ACT AFTER FOUR (4)

OF ACTION AROSE.

Prescriptive periods:

YEARS FROM THE TIME THE CAUSE

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Civil case – 4 years Criminal case – follow the RPC based on penalty (i.e., length of imprisonment, amount of fine)

CHAPTER XX MISCELLANEOUS PROVISIONS SEC. 227. OWNERSHIP OF DEPOSIT AND INSTRUMENTS. - ALL COPIES DEPOSITED AND INSTRUMENTS IN WRITING FILED WITH THE NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT SHALL BECOME THE PROPERTY OF THE GOVERNMENT. SEC. 228. PUBLIC RECORDS. - THE

SUPREME COURT LIBRARY CHARGED WITH RECEIVING COPIES AND INSTRUMENTS DEPOSITED AND WITH KEEPING RECORDS REQUIRED UNDER THIS ACT AND EVERYTHING IN IT SHALL BE OPENED TO PUBLIC INSPECTION. THE DIRECTOR OF THE NATIONAL LIBRARY IS EMPOWERED TO ISSUE SUCH SAFEGUARDS AND REGULATIONS AS MAY BE NECESSARY TO IMPLEMENT THIS SECTION AND OTHER PROVISIONS OF THIS ACT. SECTION OR DIVISION OF THE

NATIONAL LIBRARY

AND THE

Sec. 229. Copyright Division Fees. - The Copyright Section of the National Library shall be classified as a Division upon the effectivity of this Act. The National Library shall have the power to collect, for the discharge of its services under this Act, such fees as may be promulgated by it from time to time subject to the approval of the Department Head. Q. What is SB 1704 by Ople? A. It is on proposed amendments on the copyright portion of the IP Code. Since the Senate has already ratified the WiPO, SB 1704 may be passed. Some relevant provisions of the SB 1704 are: 1. Anti-circumvention measures to beimplemented - Sony and the chip - would penalize the sale, manufacture and use of the anti-circumvention devices 2. Broader reproduction rights - broader reproduction rights, temporary and permanent reproduction; internet; right to make work available 3. Terms of Protection extended (from 50 years to 75 years) 4. Enforcement – making the IP Code easier to enforce with stiffer penalties Q. What are some issues on fair use in the internet? A. Internet gives (or requires) a new way of looking at copyright. It makes it more difficult to enforce the right to control access, disclosure and to prevent alteration (it is easier to make alterations over the internet). Also, there may be several copyright owners in the internet setting. Content maybe owned by the author, the website control the access, etc. Q. What is the significance of the E-Commerce Act on copyright infringement? A. The ISP is made liable under the ECA during instances where it allows for the hosting of websites which carries or is the source of infringing materials. So you can go after the website owner and the ISP and the source of their liability would be the violation of the ECA. Q. When is it possible to use digital works (found over the internet) without infringement? A. 1. Implied license – when the website where the material is found contains no restrictions on copying 2. Fair use 3. Information posted is part of public domain or is not copyrightable Q. What is contributory infringement?

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A. It is when you allow others to make copies. There is no specific provision for contributory infringement in the IP Code. But you can still bring a case for this under a criminal action, making the person who allowed the making of copies an accessory or accomplice. It may not be possible to file a civil case. Note however that SB 1740 provides for contributory infringement. MAI SYSTEMS CORP. v. PEAK COMPUTER, INC., 991 F.2d 511 (9th Cir. 1993) MAI Systems Corp., until recently, manufactured computers and designed software to run those computers. The company continues to service its computers and the software necessary to operate the computers. MAI software includes operating system software, which is necessary to run any other program on the computer. Peak Computer, Inc. is a company organized in 1990 that maintains computer systems for its clients. Peak maintains MAI computers for more than one hundred clients in Southern California. This accounts for between fifty and seventy percent of Peak's business. Peak's service of MAI computers includes routine maintenance and emergency repairs. Malfunctions often are related to the failure of circuit boards inside the computers, and it may be necessary for a Peak technician to operate the computer and its operating system software in order to service the machine. In August, 1991, Eric Francis left his job as customer service manager at MAI and joined Peak. Three other MAI employees joined Peak a short time later. Some businesses that had been using MAI to service their computers switched to Peak after learning of Francis's move. On March 17, 1992, MAI filed suit in the district court against Peak, Peak's president Vincent Chiechi, and Francis. The complaint includes counts alleging copyright infringement, misappropriation of trade secrets, trademark infringement, false advertising, and unfair competition. The district court granted summary judgment in favor of MAI on its claims of copyright infringement and issued a permanent injunction against Peak on these claims. The alleged copyright violations include: (1) Peak's running of MAI software licensed to Peak customers; (2) Peak's use of unlicensed software at its headquarters; and, (3) Peak's loaning of MAI computers and software to its customers. Each of these alleged violations must be considered separately.

Held: To prevail on a claim of copyright infringement, a plaintiff must prove ownership of a copyright and a

"`copying' of protectable expression" beyond the scope of a license. MAI software licenses allow MAI customers to use the software for their own internal information processing.[n3] This allowed use necessarily includes the loading of the software into the computer's random access memory ("RAM") by a MAI customer.

However, MAI software licenses do not allow for the use or copying of MAI software by third parties such as Peak. Therefore, any "copying" done by Peak is "beyond the scope" of the license.

It is not disputed that MAI owns the copyright to the software at issue here, however, Peak vigorously disputes the district court's conclusion that a "copying" occurred under the Copyright Act. The Copyright Act then explains, “A work is "fixed" in a tangible medium of expression when its embodiment in a copy or phonorecord, by or under the authority of the author, is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration.” The district court's grant of summary judgment on MAI's claims of copyright infringement reflects its conclusion that a "copying" for purposes of copyright law occurs when a computer program is transferred from a permanent storage device to a computer's RAM. This conclusion is consistent with its finding, in granting the preliminary injunction, that: "the loading of copyrighted computer software from a storage medium (hard disk, floppy disk, or read only memory) into the memory of a central processing unit ("CPU") causes a copy to be made. In the absence of ownership of the copyright or express permission by license, such acts constitute copyright infringement." We find that this conclusion is supported by the record and by the law. Peak concedes that in maintaining its customer's computers, it uses MAI operating software "to the extent that the repair and maintenance process necessarily involves turning on the computer to make sure it is functional and thereby running the operating system." It is also uncontroverted that when the computer is turned on the operating system is loaded into the computer's RAM. As part of diagnosing a computer problem at the customer site, the Peak technician runs the computer's operating system software, allowing the technician to view the systems error log, which is part of the operating system, thereby enabling the technician to diagnose the problem. Peak argues that this loading of copyrighted software does not constitute a copyright violation because the "copy" created in RAM is not "fixed." However, by showing that Peak loads the

software into the RAM and is then able to view the system error log and diagnose the problem with the computer. MAI has adequately shown that the representation created in the RAM is "sufficiently permanent

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or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration. The law also supports the conclusion that Peak's loading of copyrighted software into RAM creates a "copy" of that software in violation of the Copyright Act. Q. What is the Berne Convention? A. The Berne Convention for the protection of literary and artistic works is the Paris Act of July 24, 1971. Q. What are the pertinent provisions on 1) national treatment, 2) principle of automatic protection and 3) principle of independence of protection? A. 1. National Treatment (1) Authors shall enjoy, in respect of works for which they are protected under this convention, in

countries of the Union other than the country of origin, the rights which their respective laws do now or may hereafter grant to their nationals, as well as the rights specially granted by this Convention.

2.

Principle of automatic protection (2) The enjoyment and the exercise of these rights shall not be subject to any formality; such enjoyment and such exercise shall be independent of the existence of protection in the country of origin of the work. Consequently, apart from the provisions of this convention, the extent of protection, as well as the means of redress afforded to the author to protect his rights, shall be governed exclusively by the laws of the country where protection is claimed.

3. Principle of Independence of Protection. (3) Protection in the country of origin is governed by domestic law. However, when the author is not a national of the country of origin of the work for which is protected under this Convention, he shall enjoy in that country the same rights as national authors.

Q. What is the TRIPS Agreement? A. The TRIPS is the agreement on the trade related aspects of rights, including trade in counterfeit goods. Q. What are the pertinent provisions of the TRIPS concerning 1) National Treatment, and 2) Most Favored Nation Principle? A. They are: 1.

National Treatment: 1.

Each Member shall accord to the nationals of other Members treatment no less favourable than that it accords to its own nationals with regard to the protection (3) of intellectual property, subject to the exceptions already provided in, respectively, the Paris Convention (1967), the Berne Convention (1971), the Rome Convention or the Treaty on Intellectual Property in Respect of Integrated Circuits. In respect of performers, producers of phonograms and broadcasting organizations, this obligation only applies in respect of the rights provided under this Agreement. Any Member availing itself of the possibilities provided in Article 6 of the Berne Convention (1971) or paragraph 1(b) of Article 16 of the Rome Convention shall make a notification as foreseen in those provisions to the Council for TRIPS.

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2.

Members may avail themselves of the exceptions permitted under paragraph 1 in relation to judicial and administrative procedures, including the designation of an address for service or the appointment of an agent within the jurisdiction of a Member, only where such exceptions are necessary to secure compliance with laws and regulations which are not inconsistent with the provisions of this Agreement and where such practices are not applied in a manner which would constitute a disguised restriction on trade.

2. Most Favored Nation Treatment With regard to the protection of intellectual property, any advantage, favour, privilege or immunity granted by a Member to the nationals of any other country shall be accorded immediately and unconditionally to the nationals of all other Members. Exempted from this obligation are any advantage, favour, privilege or immunity accorded by a Member: (a) deriving from international agreements on judicial assistance or law enforcement of a general nature and not particularly confined to the protection of intellectual property; (b) granted in accordance with the provisions of the Berne Convention (1971) or the Rome Convention authorizing that the treatment accorded be a function not of national treatment but of the treatment accorded in another country; (c) in respect of the rights of performers, producers of phonograms and broadcasting organizations not provided under this Agreement; (d) deriving from international agreements related to the protection of intellectual property which entered into force prior to the entry into force of the WTO Agreement, provided that such agreements are notified to the Council for TRIPS and do not constitute an arbitrary or unjustifiable discrimination against nationals of other Members.

EXEUNT

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AS

WITH

COPYRIGHT

PORTION, DIGESTS AND NOTES ARE PLACED UNDER THE PROPER HEADING.

MATERIAL IS NOT DISCUSSED IN THE PRESENTED ORDER.

THE

PART III THE LAW ON TRADEMARKS, SERVICE MARKS AND TRADE NAMES Q. What is a monopoly? A. It is the control obtained by one supplier over the commercial market within a given region (Black’s) Q. Is the exercise of Intellectual Property Law a form of monopoly? A. In a way. Copyright laws allow others to enjoy an author’s economic rights when there is permission. Trademarks protect goodwill, it does not prevent production of similar goods. Patent protection lasts for only 17 years. Q. If s, why is it allowed, since the Constitution prohibits monopolies? A. Because it provides incentive for innovation and technological advancement. Q. The Constitution provides, “the State shall regulate the acquisition, ownership, use, and disposition of property and its increments.” How does this relate to IP law? A. IP Law can be viewed as an exercise of this regulation. Copyright lasts for only 50 years. Patent protection for 17 years. Trademarks have to be used. SEC. 121. DEFINITIONS. - AS USED IN PART III, THE FOLLOWING TERMS HAVE THE FOLLOWING MEANINGS: 121.1. "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; (SEC. 38, R. A. NO. 166A) 121.2. "COLLECTIVE MARK" MEANS ANY VISIBLE SIGN DESIGNATED AS SUCH IN THE APPLICATION FOR REGISTRATION AND CAPABLE OF DISTINGUISHING THE ORIGIN OR ANY OTHER COMMON CHARACTERISTIC, INCLUDING THE QUALITY OF GOODS OR SERVICES OF DIFFERENT ENTERPRISES WHICH USE THE SIGN UNDER THE CONTROL OF THE REGISTERED OWNER OF THE COLLECTIVE MARK;

(SEC. 40, R. A. NO. 166A)

121.3. "TRADE NAME" MEANS THE NAME OR DESIGNATION IDENTIFYING OR DISTINGUISHING AN ENTERPRISE; (SEC. 38, R. A. NO. 166A) 121.4. "BUREAU" MEANS THE BUREAU OF TRADEMARKS; 121.5. "DIRECTOR" MEANS THE DIRECTOR OF TRADEMARKS; 121.6. "REGULATIONS" MEANS THE RULES OF PRACTICE IN TRADEMARKS AND SERVICE MARKS FORMULATED BY THE DIRECTOR OF TRADEMARKS AND APPROVED BY THE DIRECTOR GENERAL; AND 121.7. "EXAMINER" MEANS THE TRADEMARK EXAMINER. (SEC. 38, R. A. NO. 166A) Q. Can a trademark be a tradename at the same time? A. Yes. Q. Can smell be a proper trademark? A. The law does not seem to allow it, since a “mark” is defined as a visible sign. Q. Can sound be a proper trademark? E.g. the distinctive sound of a Harley Davidson A. No. It must be a visible sign, under the IP code, and under an American case.

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SEC. 122. HOW MARKS ARE ACQUIRED. - THE RIGHTS IN A MARK SHALL BE ACQUIRED THROUGH REGISTRATION MADE VALIDLY IN ACCORDANCE WITH THE PROVISIONS OF THIS LAW. (SEC. 2-A, R. A. NO. 166A) Q. How is trademark protection acquired? A. By registration. Q. A Singapore company sells products over the internet to the Philippines. It does not have an office in RP. If a Philippine company sells products here with the name of the Singapore company, can the Singapore company sue here in the Philippines, not having registered its trademark here? A. Yes, it may sue. Sec. 160 provides: Any foreign national or juridical person who meets the requirements of Section 3 of this Act and does not engage in business in the Philippines may bring a civil or administrative action hereunder for opposition, cancellation, infringement, unfair competition, or false designation of origin and false description, whether or not it is licensed to do business in the Philippines under existing laws. Q. Does it matter where title transfers, like if it were FOB Manila or FOB Singapore? A. No. SEC. 123. REGISTRABILITY. 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;

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(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 ON WHICH THE CLAIM OF DISTINCTIVENESS IS MADE.

(5) YEARS BEFORE THE DATE

123.3. THE NATURE OF THE GOODS TO WHICH THE MARK IS APPLIED WILL NOT CONSTITUTE AN OBSTACLE TO (SEC. 4, R. A. NO. 166A)

REGISTRATION.

A MARK CANNOT BE REGISTERED IF IT: (a) immoral, deceptive or scandalous matter (b) flag or coat of arms (c) name of a particular living individual or portrait of a deceased President of the Philippines (d) Is identical with a registered mark as to : (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; Amigo v. Cluet Peabody – Idem Sonans 354 SCRA 434 (2001) Cluet (NY) filed for cancellation of Amigo (RP) TM for “Gold Toe.” Cluet owns “Gold Top. Cluet alleged Amigo uses similar logo, uses the word “linenized” which is their registered TM. Director of Patents and CA ruled for cancellation, based on application of 1) idem sonans rule and 2) existence of a confusing similarity in appearance between the trademarks. Amigo argues that “Gold Toe” and “Gold Top” do not sound alike and are

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pronounced differently. Since the words “gold” and “toe” are generic, Cluet has no right to exclusive use. HELD: Idem sonans argument incorrect. Admittedly the pronunciation of Gold Top and Gold Toe, do not by themselves, cause confusion. However, there is hardly a variance in the appearance of the logo’s. SC used the dominancy test and the holistic test. In either test, there is an obvious colorable imitation. Nestle v. CA – Master not generic 356 SCRA 207 (2001) CFC Corp. filed application for registration of Flavor Master instant coffee. Nestle filed notice of opposition claiming trademark is confusingly similar for Master Roast and Master Blend are its own TM. Nestle claims use of CFC will cause confusion and deceive purchasers as dominant word present in the three trademarks is Master. CA used holistic test, Nestle claims dominancy test should be used. HELD: Correct. Test is ordinary purchaser who in buying more common and less expensive household products is less inclined to closely examine specific details of similarities and dissimilarities. The word Master is neither a generic nor a descriptive term, and as such, said term cannot be invalidated as a trademark and may be legally protected. A generic term is the common descriptive name of an article or substance, and a descriptive term conveys the characteristics, functions, qualities and ingredient of a product to one who has never seen it and does not know what it is. Master is a suggestive term brought about by the advertising scheme of Nestle, as when it uses Jaworski and Puno. (e) similar to, or translation of, internationally known mark, registered or not as to same goods (f) similar to, or translation of, internationally known mark, when registered, as to all goods. Canon v. CA NSR Rubber filed an application for the registration of the mark Canon for Sandals. Canon (Japan) filed an opposition, alleging that it will be damaged by the registration of Canon for Sandals. Canon manufactures chemical products, photographic and cinematographic instruments, and electrical instruments. The products manufactured by the parties are dissimilar but Canon Japan points out that it has branched out its business on various goods including footwear. Held: Ordinarily, ownership of trademark is a property right which is entitled to protection. However, when a TM is used for a product in which the other party does not deal, the use of the same trademark on the latter’s product cannot be validly objected to. The certificate of registration shown by Canon Japan in RP and other countries show that the covered goods are paints, chemical products and toners. Trademark owner is entitled to protection when junior user forestalls the normal expansion of the business, but Canon Japan has failed to attach evidence that would convince that it has also embarked in the production of footwear products. Q. Do you agree with the decision? A. Proper answer: The decision interpreted the law then. The case would have been decided differently today, due to the amendments introduced by Sec. 123.1 (e). Q. Why is this the proper answer? A. Case was drafted by Negre when he was in the Bureau of Trademarks.

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(g) misleading as to the nature, quality, characteristics or geographical origin of the goods or services; (h) generic Kellogg v. National Biscuit Company Nabisco brought a suit against Kellogg to enjoin unfair competition in the manufacture and sale of breakfast food known as shredded wheat. Kellogg, like Nabisco, uses the name shredded wheat and produces it in pillow-shaped form. Shredded wheat was introduced in 1893 by Perky and the patent expired in 1895, going into public domain. Nabisco was the first manufacturer. Nabisco does not claim exclusive right to make shredded wheat but claims exclusive right to the trade name “Shredded Wheat.” Nabisco also claims that it has acquired a secondary meaning. Held: Nabisco has no exclusive right to use the term “Shredded Wheat” as a trade name, for that is the generic term of the article which describes it with a fair degree of accuracy. Since the term is generic, the original maker of the product acquired no exclusive right to use it. There is no basis for applying the doctrine of secondary meaning. To establish a trade name, plaintiff must show more than a subordinate meaning, but must show that the primary significance of the term in the minds of the consuming public is not the product but the producer. Q. Can you trademark the terms thermos, cellophane, aspirin? A. No. These used to be big marks, but because of “improper use” (not non-use) they were abandoned. Xerox is now spending billions in advertising to reclaim the trademark. (i) descriptive Q. Can a descriptive word be appropriated? A. No. But it can be appropriated when used in combination with other words. Romero v. Maiden Form Inc. Maidenform, a foreign corporation, filed an application for registration of the trademark Adagio for the brassieres it manufactures. This was alleged to have first been used in US in 1937 and in RP in 1946. This was granted. Romero filed a petition for cancellation on the ground that it is a common descriptive name of an article. It was said that that Adagio has become a common descriptive name of a particular style of brassiere and is unregistrable. Held: No merit. Adagio is a musical term meaning slow or easy manner first used by owners because they are musically inclined. They also adopted other terms such as Etude, Overture, Chansonette. The fact that said mark is used also to designate a particular style of brassiere does not affect its registrability as a trademark. Its long and continuous use has not rendered it merely descriptive. Widespread dissemination does not justify the [oppositor’s] use of the trademark. Ong Ai Gui v. Director Ong Ai Gui filed an application for the registration of the tradename, “20th Century Nylon Shirts Factory.” E. I. Du Pont filed an opposition on the ground that the word “nylon” was a name coined by Du Pont as a generic name of a synthetic fabric and is a generic term,

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the use of which is descriptive and the use would cause confusion in trade. Opposition was dismissed but director asked the word “nylon” be disclaimed. Ong appeals. Held: The tradename may be registered, but it may not be entitled to exclusive use of the terms “shirt factory” and “nylon” because the terms are merely descriptive or general terms, incapable of appropriation by any single individual to the exclusion of others. This is because all persons have an equal right to produce and vend similar articles and they also have the right to describe them properly and to use appropriate language. Q. Can generic terms be appropriated by long use? A. no. Only descriptive words can be appropriated by long use. Q. “Xerox” is descriptive or generic? A. Seems to be generic, since it is found in the dictionary as a verb. (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; Q. Is a name denoting geographical location registrable as a trademark? A. General rule: Can’t be used when 1. It induces public to believe that it is manufactured in a place where it is not really manufactured there, e.g. Champagne is a sparkling wine from a particular city in France; no other wine can be called Champagne. 2. If that place is known for the goods, you can’t register, e.g. Batangas is known for its coffee Exception: If that place is not particularly known for products of that kind, e.g. Baguio Oil, Seattle’s Best (k) shapes Kellogg v. Nabisco Nabisco claims the exclusive right to make it in pillow-shaped form. It is urged that all possibility of deception and confusion would be removed it Kellogg would adopt another form other than the pillow shape. Held: The evidence is persuasive that this form is functional – that the cost of the biscuit would be increased and its high quality lessened if some other form were substituted for the pillow shape. In Re Weber The examining attorney of the Trademark Board refused registration of Weber’s barbecue grills as trademarks on the ground of functionality. Held. Wrong. The Trademark Trial and Appeals Board found that the examining attorney erred in refusing registration in the absence of evidence that the grill’s round configuration was a superior design which other manufacturers needed to be able to use in order to compete effectively. Trade dress is mechanically functional when its elements are so utilitarian or superior to alternative elements that denying these elements to competitors inhibits competition. The factors that show mechanical functionality of trade dress include 1) if a utility patent discloses the utilitarian advantages of the design, 2) the utilitarian advantages are touted through advertising, 3) there is an unavailability of alternative designs, and 4) the design is the result of a relatively simple or inexpensive manufacturing method. In this case, the kettle body and legs configuration for barbecue

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grills was found NOT de jure functional. Evidence was found sufficient to establish acquired distinctiveness. Hence, it can be registered.

Q. What is different from this case and Kellogg? A. Here, there is finding that the shape was not entirely just functional, as in Kellogg. (l) color (m) Is contrary to public order or morality.

Secondary meaning Q. Cerveza Negra means “Black Beer” in Spanish, can it be registered? A. Yes, it has acquired secondary meaning Arce Sons v. Selecta Selecta Biscuit filed a petition for the registration of the word Selecta as trademark to be used on its bakery products. Arce filed an opposition saying that it has continuously used that word in its products. It used this on its milk products and as the name of a bakery. Director granted trademark because the word as used by Arce points only to the place of business or location of its restaurant. Held: Arce has made use of Selecta not only as a tradename, indicative of the location of the restaurant but also as a trademark to indicate the goods it offers for sale to the public. The word Selecta is an ordinary or common word but once adopted or coined in connection with one’s business as an emblem or as a badge of authenticity, it may acquire a secondary meaning as to be exclusively associated with its products and business. Q. Is “premium” a proper mark? A. No. It is descriptive. Etepha v. Director Westmont (NY) sought registration of Atussin, a medical expectorant antihistamine. Etepha (liechtenstin) objected, saying Atussin is confusingly similar to Pertussin and that the buying public will be misled into believing that Westmont’s product is that of Etepha’s which enjoys goodwill. Held: Tussin is a Latin rootword meaning cough. Tussin is merely descriptive; it is generic; it furnishes to the buyer no indication of the origin of the goods. Thus, it is barred from registration as a tradename. While tussin by itself cannot be used exclusively, it may become a subject of trademark by combination with another word of phrase. Here, the two are entirely different in colors, content and arrangement so the contrast is so pronounced that the label cannot be mistaken for another. They also don’t sound alike when pronounced. Also, medicinal preparations are unlike articles of everyday use which may freely be obtained by anyone. A buyer of medicine must first go to a doctor for instructions on what to purchase, and he is cautious and would examine the product sold to him. Q. Do you agree with this case? A. Hmm… maybe not, since you should take the point of view of an ordinary consumer who doesn’t know what tussis means.

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Q. Would the case have been decided in the same manner if it involved veterinary medicine? A. Probably. People don’t usually buy vet medicine so they would be careful if they do. Philippine Nut Industry v. Standard Brands Philippine Nut obtained registration of “Philippine Planters Cordial Peanuts.” On its salted peanuts. Standard Brands, a foreign corporation filed for the cancellation of registration saying that it was the owner of “Planters Cocktail Peanuts” trademark and that Phil Nut closely resembles and is confusingly similar to its own trademark. Phil Nut claims that “Planters” cannot be considered a dominant feature of the product since it is merely descriptive. Held: Without merit. Planters is an ordinary word but it is used in the label not to describe the nature of the product but to project the source or origin of the salted peanuts. Based from the logos, it is true that other words are displayed (cordial and cocktail) but these are mere adjectives. As a whole, it is the word Planters which draws the attention of the buyer and leads him to conclude that the salted peanuts originate from one and the same manufacturer. It is true that no producer may have a monopoly of any color scheme or form of words in a label but when a competitor adopts a distinctive or dominant mark or feature of another’s trademark, the intent to pass to the public his product as that of another is quite obvious. Secondary meaning – a word originally incapable of exclusive appropriation may nevertheless have been used so long and so exclusively by one producer with reference to his article that, in that trade and to that branch of the purchasing public, the word or phrase has come to mean that the article was his product. Here, there is evidence to show that the term Planters has become a distinctive mark or symbol as salted peanuts are concerned. E Spinner v. Neuss Hesslein Corp. E Spinner (England) is engaged in manufacture and sale of textiles. It sells khaki cloth in RP under the brand Wigan. Neuss Hesslein (US) came to RP later and sold khakis. It sold it under the Five Soldiers brand then it later asked its NY office to print the word Wigan conspicuously on the khakis intended for sale in RP. Wigan is used in commercial parlance as the name of a canvass-like cotton fabric used to stiffen parts of garments. Neuss Hesslein claims to use the word to indicate color, saying that US dealers are accustomed to use the word Wigan to indicate a color of khaki cloth. E. Spinner files action to restrain use of the word Wigan, claiming that it uses that word to indicate quality. Held: The persons most to be considered is the consumer and when the word Wigan is found on khaki, the ultimate buyer or the consumer who would be led to suppose that the goods are sold by E Spinner. It makes no difference that dealers in the article are not deceived. They are informed and usually know what they are buying. The law concerns itself with the casual purchaser who knows the commodity only by its name. The word Wigan here is used in an entirely artificial sense and its association with quality had its origin exclusively in the use which E Spinner originally intended. Intel v. Advanced Micro Devices Intel uses the 386 designation for processor microchips. AMD probably used this to designate its own products and Intel filed a case against AMD.

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Held: AMD argued successfully that Intel’s 386 designation for processor microchips was generic. Intel was subsequently unsuccessful in registering 486 or i486. Hence, it switched to the “Pentium” and “Celeron” names. Note that in the US, trademark protection is acquired via use, not registration. Because Intel’s purported mark is unregistered, Intel has the burden of proof on the issue of genericness of the asserted mark Q. Why is the E. Spinner decision different from the Intel decision? A. Because in Intel, the mark was generic. In E. Spinner, the mark is descriptive of quality because it is arbitrary. Ana Ang v. Toribio Teodoro Teodoro used “Ang Tibay” for slippers and shoes since 1910. Ang registered “Ang Tibay” for shorts and shirts on 1932. Teodoro filed a complaint to cancel the registration of the TM of Ana Ang. He claims that Ana Ang has not proven that she spent money for advertising Ang Tibay shirts and pants. Ana Ang claims that the term is descriptive and that there is no secondary meaning attached to the term, and that the goods are different and are not likely to mislead the general public as to their origin. Held: “Ang Tibay” is not a descriptive term but a fanciful or coined phrase which may be legally appropriated. Ang Tibay is an exclamation denoting admiration of strength, and can be translated to mean “How strong!” Ang Tibay has also acquired a secondary meaning because the exclusive use of the phrase for Teodoro’s product has allowed it to acquire a proprietary connotation. As to the argument that the goods are not similar, although two noncompeting articles may be classified under two different classes by the Patent office, nevertheless, if simultaneous use on them would be likely to cause confusion as to the source or origin, then there can be unfair competition. Also, it would prevent the natural expansion of his business and it would cause the business to be confused with the second user. Q. Is “Ang Tibay” descriptive? A. Court held that it is a fanciful or coined term. The Court says that the proper descriptive term is “matibay” and not “Ang Tibay.” Q. Is grammar important? A. No (?) Q. Is the use of famous marks on unrelated goods permissible? A. Although they are noncompeting, if simultaneous use will cause confusion, it will not be permissible. Q. What are the kinds of words? A. The words are classified to: 1. common words a. generic b. descriptive

2. 3.

c. suggestive fanciful/coined arbitrary

– never capable of registration – there is immediate association - not registrable except when there is secondary meaning, or used with other words – requires imegination/deduction - e.g. Kodak - e.g. Apple Computer

NOTE: Fanciful and arbitrary words have the strongest form of protection.

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SEC. 124. REQUIREMENTS OF APPLICATION. 124.1. THE APPLICATION FOR THE REGISTRATION OF THE MARK SHALL BE IN FILIPINO OR IN ENGLISH AND SHALL CONTAIN THE FOLLOWING: (A) A REQUEST FOR REGISTRATION; (B) THE NAME AND ADDRESS OF THE APPLICANT; (C) THE NAME OF A STATE OF WHICH THE APPLICANT IS A NATIONAL OR WHERE HE HAS DOMICILE; AND THE STATE IN WHICH THE APPLICANT HAS A REAL AND EFFECTIVE INDUSTRIAL OR COMMERCIAL ESTABLISHMENT, IF ANY;

NAME OF A

(D) WHERE THE APPLICANT IS A JURIDICAL ENTITY, THE LAW UNDER WHICH IT IS ORGANIZED AND EXISTING; (E) THE APPOINTMENT OF AN AGENT OR REPRESENTATIVE, IF THE APPLICANT IS NOT DOMICILED IN THE PHILIPPINES; (F) WHERE THE APPLICANT CLAIMS THE PRIORITY OF AN EARLIER APPLICATION, AN INDICATION OF: (I) THE NAME OF THE STATE WITH WHOSE NATIONAL OFFICE THE EARLIER APPLICATION WAS FILED OR IT FILED WITH AN OFFICE OTHER THAN A NATIONAL OFFICE, THE NAME OF THAT OFFICE, (II) THE DATE ON WHICH THE EARLIER APPLICATION WAS FILED, AND (III) WHERE AVAILABLE, THE APPLICATION NUMBER OF THE EARLIER APPLICATION; (G) WHERE THE APPLICANT CLAIMS COLOR AS A DISTINCTIVE FEATURE OF THE MARK, A STATEMENT TO THAT EFFECT AS WELL AS THE NAME OR NAMES OF THE COLOR OR COLORS CLAIMED AND AN INDICATION, IN RESPECT OF EACH COLOR, OF THE PRINCIPAL PARTS OF THE MARK WHICH ARE IN THAT COLOR; (H) WHERE THE MARK IS A THREE-DIMENSIONAL MARK, A STATEMENT TO THAT EFFECT; (I) ONE OR MORE REPRODUCTIONS OF THE MARK, AS PRESCRIBED IN THE REGULATIONS; (J) A TRANSLITERATION OR TRANSLATION OF THE MARK OR OF SOME PARTS OF THE MARK, AS PRESCRIBED IN THE REGULATIONS; (K) THE NAMES OF THE GOODS OR SERVICES FOR WHICH THE REGISTRATION IS SOUGHT, GROUPED ACCORDING TO THE CLASSES OF THE NICE CLASSIFICATION, TOGETHER WITH THE NUMBER OF THE CLASS OF THE SAID CLASSIFICATION TO WHICH EACH GROUP OF GOODS OR SERVICES BELONGS; AND (L) A SIGNATURE BY, OR OTHER SELF-IDENTIFICATION OF, THE APPLICANT OR HIS REPRESENTATIVE. 124.2. 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. 124.3. ONE (1) APPLICATION MAY RELATE TO SEVERAL GOODS AND/OR SERVICES, WHETHER THEY BELONG TO ONE (1) CLASS OR TO SEVERAL CLASSES OF THE NICE CLASSIFICATION. 124.4. IF DURING THE EXAMINATION OF THE APPLICATION, THE OFFICE FINDS FACTUAL BASIS TO REASONABLY DOUBT THE VERACITY OF ANY INDICATION OR ELEMENT IN THE APPLICATION, IT MAY REQUIRE THE APPLICANT TO SUBMIT SUFFICIENT EVIDENCE TO REMOVE THE DOUBT.

(SEC. 5, R. A. NO. 166A)

SEC. 125. REPRESENTATION; ADDRESS FOR SERVICE. - IF THE APPLICANT IS NOT DOMICILED OR HAS NO REAL AND EFFECTIVE COMMERCIAL ESTABLISHMENT IN THE PHILIPPINES, HE SHALL DESIGNATE BY A WRITTEN DOCUMENT FILED IN THE OFFICE,

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THE NAME AND ADDRESS OF A PHILIPPINE RESIDENT WHO MAY BE SERVED NOTICES OR PROCESS IN PROCEEDINGS AFFECTING

THE MARK.

SUCH NOTICES OR SERVICES MAY BE SERVED UPON THE PERSON SO DESIGNATED BY LEAVING A COPY THEREOF AT IF THE PERSON SO DESIGNATED CANNOT BE FOUND AT THE ADDRESS GIVEN IN THE LAST DESIGNATION, SUCH NOTICE OR PROCESS MAY BE SERVED UPON THE DIRECTOR. (SEC. 3, R. A. NO. 166A) THE ADDRESS SPECIFIED IN THE LAST DESIGNATION FILED.

SEC. 126. DISCLAIMERS. - THE OFFICE MAY ALLOW OR REQUIRE THE APPLICANT TO DISCLAIM AN UNREGISTRABLE

COMPONENT OF AN OTHERWISE REGISTRABLE MARK BUT SUCH DISCLAIMER SHALL NOT PREJUDICE OR AFFECT THE APPLICANT’S OR OWNER’S RIGHTS THEN EXISTING OR THEREAFTER ARISING IN THE DISCLAIMED MATTER, NOR SUCH SHALL DISCLAIMER

PREJUDICE OR AFFECT THE APPLICANT’S OR OWNER’S RIGHT ON ANOTHER APPLICATION OF LATER DATE IF THE DISCLAIMED MATTER BECAME DISTINCTIVE OF THE APPLICANT’S OR OWNER’S GOODS, BUSINESS OR SERVICES.

(SEC. 13, R. A. NO. 166A)

SEC. 127. FILING DATE. 127.1. REQUIREMENTS. - THE FILING DATE OF AN APPLICATION SHALL BE THE DATE ON WHICH THE OFFICE RECEIVED THE FOLLOWING INDICATIONS AND ELEMENTS IN ENGLISH OR FILIPINO: (A) AN EXPRESS OR IMPLICIT INDICATION THAT THE REGISTRATION OF A MARK IS SOUGHT; (B) THE IDENTITY OF THE APPLICANT; (C) INDICATIONS SUFFICIENT TO CONTACT THE APPLICANT OR HIS REPRESENTATIVE, IF ANY; (D) A REPRODUCTION OF THE MARK WHOSE REGISTRATION IS SOUGHT; AND (E) THE LIST OF THE GOODS OR SERVICES FOR WHICH THE REGISTRATION IS SOUGHT. 127.2 NO FILING DATE SHALL BE ACCORDED UNTIL THE REQUIRED FEE IS PAID. (N) SEC. 128. SINGLE REGISTRATION FOR GOODS AND/OR SERVICES. - WHERE GOODS AND/OR SERVICES BELONGING TO SEVERAL CLASSES OF THE NICE CLASSIFICATION HAVE BEEN INCLUDED IN ONE (1) APPLICATION, SUCH AN APPLICATION SHALL RESULT IN ONE REGISTRATION. (N) SEC. 129. DIVISION OF APPLICATION. - ANY APPLICATION REFERRING TO SEVERAL GOODS OR SERVICES, HEREAFTER REFERRED TO AS THE "INITIAL APPLICATION," MAY BE DIVIDED BY THE APPLICANT INTO TWO (2) OR MORE APPLICATIONS, HEREAFTER REFERRED TO AS THE

"DIVISIONAL APPLICATIONS,"

BY DISTRIBUTING AMONG THE LATTER THE GOODS OR

SERVICES REFERRED TO IN THE INITIAL APPLICATION.

THE DIVISIONAL APPLICATIONS SHALL PRESERVE THE FILING DATE OF THE INITIAL APPLICATION OR THE BENEFIT OF THE RIGHT OF PRIORITY. (N)

SEC. 130. SIGNATURE AND OTHER MEANS OF SELF-IDENTIFICATION. 130.1. WHERE A SIGNATURE IS REQUIRED, THE OFFICE SHALL ACCEPT: (A) A HAND-WRITTEN SIGNATURE; OR (B) THE USE OF OTHER FORMS OF SIGNATURE, SUCH AS A PRINTED OR STAMPED SIGNATURE, OR THE USE OF A SEAL, INSTEAD OF A HAND-WRITTEN SIGNATURE: PROVIDED, THAT WHERE A SEAL IS USED, IT SHOULD BE ACCOMPANIED BY AN INDICATION IN LETTERS OF THE NAME OF THE SIGNATORY. 130.2. THE OFFICE SHALL ACCEPT COMMUNICATIONS TO IT BY TELECOPIER, OR BY ELECTRONIC MEANS SUBJECT TO THE CONDITIONS OR REQUIREMENTS THAT WILL BE PRESCRIBED BY THE REGULATIONS. WHEN COMMUNICATIONS ARE MADE BY TELEFACSIMILE, THE REPRODUCTION OF THE SIGNATURE, OR THE REPRODUCTION OF THE SEAL TOGETHER WITH, WHERE REQUIRED, THE INDICATION IN LETTERS OF THE NAME OF THE NATURAL PERSON WHOSE SEAL IS USED, APPEARS. THE ORIGINAL COMMUNICATIONS MUST BE RECEIVED BY THE OFFICE WITHIN THIRTY (30) DAYS FROM DATE OF RECEIPT OF THE TELEFACSIMILE. 130.3. NO ATTESTATION, NOTARIZATION, AUTHENTICATION, LEGALIZATION OR OTHER CERTIFICATION OF ANY SIGNATURE OR OTHER MEANS OF SELF-IDENTIFICATION REFERRED TO IN THE PRECEDING PARAGRAPHS, WILL BE REQUIRED, EXCEPT, WHERE THE SIGNATURE CONCERNS THE SURRENDER OF A REGISTRATION. (N) SEC. 131. PRIORITY RIGHT. -

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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 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. SUE FOR ACTS COMMITTED PRIOR TO THE DATE ON WHICH HIS MARK WAS REGISTERED IN THIS COUNTRY:

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.

(SEC. 37, R. A. NO. 166A)

SEC. 132. APPLICATION NUMBER AND FILING DATE. 132.1. THE OFFICE SHALL EXAMINE WHETHER THE APPLICATION SATISFIES THE REQUIREMENTS FOR THE GRANT OF A FILING DATE AS PROVIDED IN SECTION 127 AND REGULATIONS RELATING THERETO. IF THE APPLICATION DOES NOT SATISFY THE FILING REQUIREMENTS, THE OFFICE SHALL NOTIFY THE APPLICANT WHO SHALL WITHIN A PERIOD FIXED BY THE REGULATIONS COMPLETE OR CORRECT THE APPLICATION AS REQUIRED, OTHERWISE, THE APPLICATION SHALL BE CONSIDERED WITHDRAWN. 132.2 ONCE AN APPLICATION MEETS THE FILING REQUIREMENTS OF SECTION 127, IT SHALL BE NUMBERED IN THE SEQUENTIAL ORDER, AND THE APPLICANT SHALL BE INFORMED OF THE APPLICATION NUMBER AND THE FILING DATE OF THE APPLICATION WILL BE DEEMED TO HAVE BEEN ABANDONED. (N) SEC. 133. EXAMINATION AND PUBLICATION. 133.1. ONCE THE APPLICATION MEETS THE FILING REQUIREMENTS OF SECTION 127, THE OFFICE SHALL EXAMINE WHETHER THE APPLICATION MEETS THE REQUIREMENTS OF SECTION 124 AND THE MARK AS DEFINED IN SECTION 121 IS REGISTRABLE UNDER SECTION 123. 133.2. WHERE THE OFFICE FINDS THAT THE CONDITIONS REFERRED TO IN SUBSECTION 133.1 ARE FULFILLED, IT SHALL, UPON PAYMENT OF THE PRESCRIBED FEE. FORTHWITH CAUSE THE APPLICATION, AS FILED, TO BE PUBLISHED IN THE PRESCRIBED MANNER. 133.3. IF AFTER THE EXAMINATION, THE APPLICANT IS NOT ENTITLED TO REGISTRATION FOR ANY REASON, THE OFFICE THE APPLICANT SHALL HAVE A PERIOD OF FOUR (4) MONTHS IN WHICH TO REPLY OR AMEND HIS APPLICATION, WHICH SHALL THEN BE RE-EXAMINED. THE REGULATIONS SHALL DETERMINE THE PROCEDURE FOR THE RE-EXAMINATION OR REVIVAL OF AN APPLICATION AS WELL AS THE APPEAL TO THE DIRECTOR OF TRADEMARKS FROM ANY FINAL ACTION BY THE EXAMINER.

SHALL ADVISE THE APPLICANT THEREOF AND THE REASONS THEREFOR.

133.4. AN ABANDONED APPLICATION MAY BE REVIVED AS A PENDING APPLICATION WITHIN THREE (3) MONTHS FROM THE DATE OF ABANDONMENT, UPON GOOD CAUSE SHOWN AND THE PAYMENT OF THE REQUIRED FEE. 133.5. THE FINAL DECISION OF REFUSAL OF THE DIRECTOR OF TRADEMARKS SHALL BE APPEALABLE TO THE DIRECTOR GENERAL IN ACCORDANCE WITH THE PROCEDURE FIXED BY THE REGULATIONS. (SEC. 7, R. A. NO. 166A)

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SEC. 134. OPPOSITION. - ANY PERSON WHO BELIEVES THAT HE WOULD BE DAMAGED BY THE REGISTRATION OF A MARK MAY, UPON PAYMENT OF THE REQUIRED FEE AND WITHIN THIRTY (30) DAYS AFTER THE PUBLICATION REFERRED TO IN SUBSECTION 133.2, FILE WITH THE OFFICE AN OPPOSITION TO THE APPLICATION. SUCH OPPOSITION SHALL BE IN WRITING AND VERIFIED BY THE OPPOSITOR OR BY ANY PERSON ON HIS BEHALF WHO KNOWS THE FACTS, AND SHALL SPECIFY THE GROUNDS ON WHICH IT IS BASED AND INCLUDE A STATEMENT OF THE FACTS RELIED UPON. COPIES OF CERTIFICATES OF REGISTRATION OF MARKS REGISTERED IN OTHER COUNTRIES OR OTHER SUPPORTING DOCUMENTS MENTIONED IN THE OPPOSITION SHALL BE FILED THEREWITH, TOGETHER WITH THE TRANSLATION IN ENGLISH, IF NOT IN THE

ENGLISH LANGUAGE. FOR GOOD CAUSE SHOWN

AND UPON PAYMENT OF THE REQUIRED SURCHARGE, THE TIME FOR FILING AN OPPOSITION MAY BE EXTENDED BY THE

DIRECTOR OF LEGAL AFFAIRS, WHO SHALL NOTIFY THE APPLICANT OF SUCH EXTENSION. THE REGULATIONS SHALL FIX THE MAXIMUM PERIOD OF TIME WITHIN WHICH TO FILE THE OPPOSITION. (SEC. 8, R. A. NO. 165A)

SEC. 135. NOTICE AND HEARING. - UPON THE FILING OF AN OPPOSITION, THE OFFICE SHALL SERVE NOTICE OF THE FILING ON THE APPLICANT, AND OF THE DATE OF THE HEARING THEREOF UPON THE APPLICANT AND THE OPPOSITOR AND ALL OTHER PERSONS HAVING ANY RIGHT, TITLE OR INTEREST IN THE MARK COVERED BY THE APPLICATION, AS APPEAR OF RECORD IN THE OFFICE. (SEC. 9 R. A. NO. 165) SEC. 136. ISSUANCE AND PUBLICATION OF CERTIFICATE. - WHEN THE PERIOD FOR FILING THE OPPOSITION HAS EXPIRED, OR DIRECTOR OF LEGAL AFFAIRS SHALL HAVE DENIED THE OPPOSITION, THE OFFICE UPON PAYMENT OF THE REQUIRED FEE, SHALL ISSUE THE CERTIFICATE OF REGISTRATION. UPON ISSUANCE OF A CERTIFICATE OF REGISTRATION, NOTICE THEREOF MAKING REFERENCE TO THE PUBLICATION OF THE APPLICATION SHALL BE PUBLISHED IN THE IPO GAZETTE. (SEC. 10, R. A. NO. 165) WHEN THE

SEC. 137. REGISTRATION OF MARK AND ISSUANCE OF A CERTIFICATE TO THE OWNER OR HIS ASSIGNEE. 137.1. THE OFFICE SHALL MAINTAIN A REGISTER IN WHICH SHALL BE REGISTERED MARKS, NUMBERED IN THE ORDER OF THEIR REGISTRATION, AND ALL TRANSACTIONS IN RESPECT OF EACH MARK, REQUIRED TO BE RECORDED BY VIRTUE OF THIS LAW. 137.2. THE REGISTRATION OF A MARK SHALL INCLUDE A REPRODUCTION OF THE MARK AND SHALL MENTION: ITS NUMBER; THE NAME AND ADDRESS OF THE REGISTERED OWNER AND, IF THE REGISTERED OWNER’S ADDRESS IS OUTSIDE

THE COUNTRY, HIS ADDRESS FOR SERVICE WITHIN THE COUNTRY; THE DATES OF APPLICATION AND REGISTRATION; IF PRIORITY IS CLAIMED, AN INDICATION OF THIS FACT, AND THE NUMBER, DATE AND COUNTRY OF THE APPLICATION,

BASIS OF THE PRIORITY CLAIMS; THE LIST OF GOODS OR SERVICES IN RESPECT OF WHICH REGISTRATION HAS BEEN

GRANTED, WITH THE INDICATION OF THE CORRESPONDING CLASS OR CLASSES; AND SUCH OTHER DATA AS THE REGULATIONS MAY PRESCRIBE FROM TIME TO TIME.

137.3. A CERTIFICATE OF REGISTRATION OF A MARK MAY BE ISSUED TO THE ASSIGNEE OF THE APPLICANT: PROVIDED, THAT THE ASSIGNMENT IS RECORDED IN THE OFFICE. IN CASE OF A CHANGE OF OWNERSHIP, THE OFFICE SHALL AT THE WRITTEN REQUEST SIGNED BY THE OWNER, OR HIS REPRESENTATIVE, OR BY THE NEW OWNER, OR HIS REPRESENTATIVE AND UPON A PROPER SHOWING AND THE PAYMENT OF THE PRESCRIBED FEE, ISSUE TO SUCH ASSIGNEE A NEW CERTIFICATE OF REGISTRATION OF THE SAID MARK IN THE NAME OF SUCH ASSIGNEE, AND FOR THE UNEXPIRED PART OF THE ORIGINAL PERIOD. 137.4. THE OFFICE SHALL RECORD ANY CHANGE OF ADDRESS, OR ADDRESS FOR SERVICE, WHICH SHALL BE NOTIFIED TO

IT BY THE REGISTERED OWNER.

137.5. IN THE ABSENCE OF ANY PROVISION TO THE CONTRARY IN THIS ACT, COMMUNICATIONS TO BE MADE TO THE REGISTERED OWNER BY VIRTUE OF THIS ACT SHALL BE SENT TO HIM AT HIS LAST RECORDED ADDRESS AND, AT THE SAME, AT HIS LAST RECORDED ADDRESS FOR SERVICE. SEC. 138. CERTIFICATES OF REGISTRATION. - 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.

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Fabrege v. CA Co Beng Kay registered “Brute” for use on shirts, shoes and slippers. Fabrege, owner of the TM “Brut” for use on after shave lotion, shaving cream, deodorant, files opposition. Fabrege claims that it will cause confusion. Held: Co Beng Kay may be permitted to register, since Fabrege has not ventured in the production of briefs, so it cannot be allowed to feight that Co has invaded Fabrege’s exclusive domain. Justice JBL Reyes says in the Sta. Ana case that the law does not require that the goods manufactured by the second user be related to the goods produced by the senior user. But the law also says that there is infringement when the reproduction is that which causes confusion. Since the products are different, there can be no confusion. Q. Would the case have been decided the same way today? A. No, because of Sec. 138. Developer’s Group v. CA Developer’s (RP) filed an infringement case against Shangri-La Hotel claiming that it was granted the ‘Shangri-la” mark for restaurant services in 1983. It claims that the hotel was using the mark causing it prejudice. Hotel claims that it is the legal and beneficial owner of the mark which was first adopted in 1962, used in their hotel business in China, HK, Malaysia, Singapore, etc. Hotel also filed a petition against Developers for the cancellation of its registration. RTC granted Developers an injunction and Hotel seeks to lift the injunction. Held: The conflicting claims of the parties show that the right claims by Developers is far from clear. The prima facie validity of its registration has been put into serious question by the cases filed by Shangri-La 3 years ahead of its complaint. While it is not required that Developer’s right be conclusively established in this case, it is nevertheless necessary to show that it exists and is not vitiated by any substantial challenge or contradiction. Developers has failed to comply with this requirement.

Shangri-La Hotel v. CA Shangri-La filed a petition for cancellation of Developer’s “Shangri-La” mark saying that this was illegally and fraudulently obtained. Developer’s filed a complaint for infringement against the Hotel. The Hotel seeks to suspend the infringement case because of the pendency of the cancellation proceedings. Held: The earlier institution of the Hotel of the cancellation proceeding cannot effectively bar the subsequent filing of the infringement case by Developers. The certificate of registration remains valid and subsisting for as long as it has not been canceled by the court. Developer’s certificate continues as prima facie evidence of the validity of the registration. Such certificate still subsists and Developer’s may thus file a corresponding infringement case and recover damages. Further, the issue in the cancellation case is quite different from that raised in the trial court. Q. In the Developer’s case, why wasn’t it considered that the certificate gives rise to prima facie presumption, such that Developer’s still had the burden of proof? A. Court probably focused on the preliminary injunction issue rather than to intellectual property law issues.

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MIRPURI V. CA (NOT DISCUSSED IN CLASS) Escobar (RP) filed application for the use of the TM “Barbizon” for brassiers. Barbizon (NY) filed an opposition claiming that it is confusingly similar to its own mark. Opposition was dismissed and the application was granted. Later, Escobar failed to file the affidavit of use, so its registration was cancelled. Escobar reapplied for registration but assigned this to Mirpuri. This was again opposed by Barbizon with the allegation that the mark was used in US and also it has protection under the Paris Convention. Mirpuri claims the defense of res judicata. Held: The two caes do not have identical causes of action. In the present case, Barbizon introduced a fact that did not exist at the time the first case was filed and terminated. The cancellation from non-use could not have occurred in the first case, and this gave Barbizon another cause to oppose the second application. Res judicata extends only to facts and conditions as they existed at the time the judgment was rendered. When new facts intervene furnishing new basis, there is no longer res judicata. SEC. 139. PUBLICATION OF REGISTERED MARKS; INSPECTION OF REGISTER. 139.1. THE OFFICE SHALL PUBLISH, IN THE FORM AND WITHIN THE PERIOD FIXED BY THE REGULATIONS, THE MARK REGISTERED, IN THE ORDER OF THEIR REGISTRATION, REPRODUCING ALL THE PARTICULARS REFERRED TO IN SUBSECTION 137.2. 139.2. 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. (N) SEC. 140. CANCELLATION UPON APPLICATION BY REGISTRANT; AMENDMENT OR DISCLAIMER OF REGISTRATION. - UPON APPLICATION OF THE REGISTRANT, THE OFFICE MAY PERMIT ANY REGISTRATION TO BE SURRENDERED FOR CANCELLATION, AND UPON CANCELLATION THE APPROPRIATE ENTRY SHALL BE MADE IN THE RECORDS OF THE OFFICE. UPON APPLICATION OF THE REGISTRANT AND PAYMENT OF THE PRESCRIBED FEE, THE OFFICE FOR GOOD CAUSE MAY PERMIT ANY REGISTRATION TO BE AMENDED OR TO BE DISCLAIMED IN PART: PROVIDED, THAT THE AMENDMENT OR DISCLAIMER DOES NOT ALTER MATERIALLY THE CHARACTER OF THE MARK. APPROPRIATE ENTRY SHALL BE MADE IN THE RECORDS OF THE OFFICE UPON THE CERTIFICATE OF REGISTRATION OR, IF SAID CERTIFICATES IS LOST OR DESTROYED, UPON A CERTIFIED COPY THEREOF. SEC. 141. SEALED AND CERTIFIED COPIES AS EVIDENCE. - COPIES OF ANY RECORDS, BOOKS, PAPERS, OR DRAWINGS BELONGING TO THE OFFICE RELATING TO MARKS, AND COPIES OF REGISTRATIONS, WHEN AUTHENTICATED BY THE SEAL OF THE OFFICE AND CERTIFIED BY THE DIRECTOR OF THE ADMINISTRATIVE, FINANCIAL AND HUMAN RESOURCE DEVELOPMENT SERVICE BUREAU OR IN HIS NAME BY AN EMPLOYEE OF THE OFFICE DULY AUTHORIZED BY SAID DIRECTOR, SHALL BE EVIDENCE IN ALL CASES WHEREIN THE ORIGINALS WOULD BE EVIDENCE; AND ANY PERSON WHO APPLIES AND PAYS THE PRESCRIBED FEE SHALL SECURE SUCH COPIES. (N) SEC. 142. CORRECTION OF MISTAKES MADE BY THE OFFICE. - WHENEVER A MATERIAL MISTAKE IN A REGISTRATION INCURRED THROUGH THE FAULT OF THE OFFICE IS CLEARLY DISCLOSED BY THE RECORDS OF THE OFFICE, A CERTIFICATE STATING THE FACT AND NATURE OF SUCH MISTAKE SHALL BE ISSUED WITHOUT CHARGE, RECORDED AND A PRINTED COPY THEREOF SHALL BE ATTACHED TO EACH PRINTED COPY OF THE REGISTRATION. SUCH CORRECTED REGISTRATION SHALL THEREAFTER HAVE THE SAME EFFECT AS THE ORIGINAL CERTIFICATE; OR IN THE DISCRETION OF THE DIRECTOR OF THE ADMINISTRATIVE, FINANCIAL AND HUMAN RESOURCE DEVELOPMENT SERVICE BUREAU A NEW CERTIFICATE OF REGISTRATION MAY BE ISSUED WITHOUT CHARGE. ALL CERTIFICATES OF CORRECTION HERETOFORE ISSUED IN ACCORDANCE WITH THE REGULATIONS AND THE REGISTRATION TO WHICH THEY ARE ATTACHED SHALL HAVE THE SAME FORCE AND EFFECT AS IF SUCH CERTIFICATES AND THEIR ISSUANCE HAD BEEN AUTHORIZED BY THIS ACT. (N) SEC. 143. CORRECTION OF MISTAKES MADE BY APPLICANT. - WHENEVER A MISTAKE IS MADE IN A REGISTRATION AND SUCH MISTAKE OCCURRED IN GOOD FAITH THROUGH THE FAULT OF THE APPLICANT, THE OFFICE MAY ISSUE A CERTIFICATE UPON

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THE PAYMENT OF THE PRESCRIBED FEE:

PROVIDED, THAT THE CORRECTION DOES NOT INVOLVE ANY CHANGE IN THE REGISTRATION THAT REQUIRES REPUBLICATION OF THE MARK. (N)

SEC. 144. CLASSIFICATION OF GOODS AND SERVICES. 144.1. EACH REGISTRATION, AND ANY PUBLICATION OF THE OFFICE WHICH CONCERNS AN APPLICATION OR REGISTRATION EFFECTED BY THE OFFICE SHALL INDICATE THE GOODS OR SERVICES BY THEIR NAMES, GROUPED ACCORDING TO THE CLASSES OF THE NICE CLASSIFICATION, AND EACH GROUP SHALL BE PRECEDED BY THE NUMBER OF THE CLASS OF THAT CLASSIFICATION TO WHICH THAT GROUP OF GOODS OR SERVICES BELONGS, PRESENTED IN THE ORDER OF THE CLASSES OF THE SAID CLASSIFICATION. 144.2. GOODS OR SERVICES MAY NOT BE CONSIDERED AS BEING SIMILAR OR DISSIMILAR TO EACH OTHER ON THE OFFICE, THEY APPEAR IN DIFFERENT CLASSES OF THE NICE CLASSIFICATION.

GROUND THAT, IN ANY REGISTRATION OR PUBLICATION BY THE

SEC. 145. DURATION. - 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

YEAR FROM THE FIFTH ANNIVERSARY OF THE DATE OF THE REGISTRATION OF THE MARK. REMOVED FROM THE

REGULATIONS, WITHIN ONE (1) OTHERWISE, THE MARK SHALL BE

REGISTER BY THE OFFICE.

SEC. 146. RENEWAL. 146.1. A CERTIFICATE OF REGISTRATION MAY BE RENEWED FOR PERIODS OF TEN (10) YEARS AT ITS EXPIRATION UPON PAYMENT OF THE PRESCRIBED FEE AND UPON FILING OF A REQUEST. THE REQUEST SHALL CONTAIN THE FOLLOWING INDICATIONS: (A) AN INDICATION THAT RENEWAL IS SOUGHT; (B) THE NAME AND ADDRESS OF THE REGISTRANT OR HIS SUCCESSOR-IN-INTEREST, HEREAFTER REFERRED TO AS THE "RIGHT HOLDER"; (C) THE REGISTRATION NUMBER OF THE REGISTRATION CONCERNED; (D) THE FILING DATE OF THE APPLICATION WHICH RESULTED IN THE REGISTRATION CONCERNED TO BE

RENEWED;

(E) WHERE THE RIGHT HOLDER HAS A REPRESENTATIVE, THE NAME AND ADDRESS OF THAT REPRESENTATIVE; (F) THE NAMES OF THE RECORDED GOODS OR SERVICES FOR WHICH THE RENEWAL IS REQUESTED OR THE NAMES OF THE RECORDED GOODS OR SERVICES FOR WHICH THE RENEWAL IS NOT REQUESTED, GROUPED ACCORDING TO THE CLASSES OF THE NICE CLASSIFICATION TO WHICH THAT GROUP OF GOODS OR SERVICES BELONGS AND PRESENTED IN THE ORDER OF THE CLASSES OF THE SAID CLASSIFICATION; AND (G) A SIGNATURE BY THE RIGHT HOLDER OR HIS REPRESENTATIVE. 146.2. SUCH REQUEST SHALL BE IN FILIPINO OR ENGLISH AND MAY BE MADE AT ANY TIME WITHIN SIX (6) MONTHS BEFORE THE EXPIRATION OF THE PERIOD FOR WHICH THE REGISTRATION WAS ISSUED OR RENEWED, OR IT MAY BE MADE WITHIN SIX (6) MONTHS AFTER SUCH EXPIRATION ON PAYMENT OF THE ADDITIONAL FEE HEREIN PRESCRIBED. 146.3. IF THE OFFICE REFUSES TO RENEW THE REGISTRATION, IT SHALL NOTIFY THE REGISTRANT OF HIS REFUSAL AND THE REASONS THEREFOR. 146.4. AN APPLICANT FOR RENEWAL NOT DOMICILED IN THE PHILIPPINES SHALL BE SUBJECT TO AND COMPLY WITH THE REQUIREMENTS OF THIS ACT. SEC. 147. RIGHTS CONFERRED. -

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147.1. 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.

147.2. THE EXCLUSIVE RIGHT OF THE OWNER OF A WELL-KNOWN MARK DEFINED IN SUBSECTION 123.1(E) WHICH IS PHILIPPINES, SHALL EXTEND TO GOODS AND SERVICES WHICH ARE NOT SIMILAR TO THOSE IN RESPECT OF WHICH THE MARK IS REGISTERED: PROVIDED, THAT USE OF THAT MARK IN RELATION TO THOSE GOODS OR REGISTERED IN THE

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. (N)

SEC. 148. USE OF INDICATIONS BY THIRD PARTIES FOR PURPOSES OTHER THAN THOSE FOR WHICH THE MARK IS USED. REGISTRATION OF THE MARK SHALL NOT CONFER ON THE REGISTERED OWNER THE RIGHT TO PRECLUDE THIRD PARTIES FROM USING BONA FIDE THEIR NAMES, ADDRESSES, PSEUDONYMS, A GEOGRAPHICAL NAME, OR EXACT INDICATIONS CONCERNING THE KIND, QUALITY, QUANTITY, DESTINATION, VALUE, PLACE OF ORIGIN, OR TIME OF PRODUCTION OR OF SUPPLY, OF THEIR GOODS OR SERVICES: PROVIDED, THAT SUCH USE IS CONFINED TO THE PURPOSES OF MERE IDENTIFICATION OR INFORMATION AND CANNOT MISLEAD THE PUBLIC AS TO THE SOURCE OF THE GOODS OR SERVICES. (N) SEC. 149. ASSIGNMENT AND TRANSFER OF APPLICATION AND REGISTRATION. 149.1. AN APPLICATION FOR REGISTRATION OF A MARK, OR ITS REGISTRATION, MAY BE ASSIGNED OR TRANSFERRED WITH OR WITHOUT THE TRANSFER OF THE BUSINESS USING THE MARK. (N) 149.2. SUCH ASSIGNMENT OR TRANSFER SHALL, HOWEVER, BE NULL AND VOID IF IT IS LIABLE TO MISLEAD THE PUBLIC, PARTICULARLY AS REGARDS THE NATURE, SOURCE, MANUFACTURING PROCESS, CHARACTERISTICS, OR SUITABILITY FOR THEIR PURPOSE, OF THE GOODS OR SERVICES TO WHICH THE MARK IS APPLIED. 149.3. THE ASSIGNMENT OF THE APPLICATION FOR REGISTRATION OF A MARK, OR OF ITS REGISTRATION, SHALL BE IN WRITING AND REQUIRE THE SIGNATURES OF THE CONTRACTING PARTIES. TRANSFERS BY MERGERS OR OTHER FORMS OF SUCCESSION MAY BE MADE BY ANY DOCUMENT SUPPORTING SUCH TRANSFER. 149.4. ASSIGNMENTS AND TRANSFERS OF REGISTRATION OF MARKS SHALL BE RECORDED AT THE OFFICE ON PAYMENT OF THE PRESCRIBED FEE; ASSIGNMENT AND TRANSFERS OF APPLICATIONS FOR REGISTRATION SHALL, ON PAYMENT OF THE SAME FEE, BE PROVISIONALLY RECORDED, AND THE MARK, WHEN REGISTERED, SHALL BE IN THE NAME OF THE ASSIGNEE OR TRANSFEREE. 149.5. ASSIGNMENTS AND TRANSFERS SHALL HAVE NO EFFECT AGAINST THIRD PARTIES UNTIL THEY ARE RECORDED AT OFFICE.

THE

SEC. 150. LICENSE CONTRACTS. 150.1. ANY LICENSE CONTRACT CONCERNING THE REGISTRATION OF A MARK, OR AN APPLICATION THEREFOR, SHALL PROVIDE FOR EFFECTIVE CONTROL BY THE LICENSOR OF THE QUALITY OF THE GOODS OR SERVICES OF THE LICENSEE IN CONNECTION WITH WHICH THE MARK IS USED.

IF THE LICENSE CONTRACT DOES NOT PROVIDE FOR SUCH QUALITY

CONTROL, OR IF SUCH QUALITY CONTROL IS NOT EFFECTIVELY CARRIED OUT, THE LICENSE CONTRACT SHALL NOT BE VALID.

150.2. A LICENSE CONTRACT SHALL BE SUBMITTED TO THE OFFICE WHICH SHALL KEEP ITS CONTENTS CONFIDENTIAL BUT SHALL RECORD IT AND PUBLISH A REFERENCE THERETO. A LICENSE CONTRACT SHALL HAVE NO EFFECT AGAINST THIRD PARTIES UNTIL SUCH RECORDING IS EFFECTED. THE REGULATIONS SHALL FIX THE PROCEDURE FOR THE RECORDING OF THE LICENSE CONTRACT. (N) SEC. 151. CANCELLATION. -

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151.1. A PETITION TO CANCEL A REGISTRATION OF A MARK UNDER THIS ACT MAY BE FILED WITH THE BUREAU OF LEGAL AFFAIRS BY ANY PERSON WHO BELIEVES THAT HE IS OR WILL BE DAMAGED BY THE REGISTRATION OF A MARK UNDER THIS ACT AS FOLLOWS: (A) WITHIN FIVE (5) YEARS FROM THE DATE OF THE REGISTRATION OF THE MARK UNDER THIS ACT. (B) AT ANY TIME, IF THE REGISTERED MARK BECOMES THE GENERIC NAME FOR THE GOODS OR SERVICES, OR A PORTION THEREOF, FOR WHICH IT IS REGISTERED, OR HAS BEEN ABANDONED, OR ITS REGISTRATION WAS OBTAINED FRAUDULENTLY OR CONTRARY TO THE PROVISIONS OF THIS ACT, OR 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. IF THE REGISTERED MARK BECOMES THE GENERIC NAME FOR LESS THAN ALL OF THE GOODS OR SERVICES FOR WHICH IT IS REGISTERED, A PETITION TO CANCEL THE REGISTRATION FOR ONLY THOSE GOODS OR SERVICES MAY BE FILED. A REGISTERED MARK SHALL NOT BE DEEMED TO BE THE GENERIC NAME OF GOODS OR SERVICES SOLELY BECAUSE SUCH MARK IS ALSO USED AS A NAME OF OR TO IDENTIFY A UNIQUE PRODUCT OR SERVICE.

THE PRIMARY SIGNIFICANCE OF

THE REGISTERED MARK TO THE RELEVANT PUBLIC RATHER THAN PURCHASER MOTIVATION SHALL BE THE TEST FOR DETERMINING WHETHER THE REGISTERED MARK HAS BECOME THE GENERIC NAME OF GOODS OR SERVICES ON OR IN CONNECTION WITH WHICH IT HAS BEEN USED. (N)

(C) AT ANY TIME, IF THE REGISTERED OWNER OF THE MARK WITHOUT LEGITIMATE REASON FAILS TO USE THE PHILIPPINES, OR TO CAUSE IT TO BE USED IN THE PHILIPPINES BY VIRTUE OF A LICENSE DURING AN UNINTERRUPTED PERIOD OF THREE (3) YEARS OR LONGER. MARK WITHIN THE

151.2. NOTWITHSTANDING THE FOREGOING PROVISIONS, THE COURT OR THE ADMINISTRATIVE AGENCY VESTED WITH JURISDICTION TO HEAR AND ADJUDICATE ANY ACTION TO ENFORCE THE RIGHTS TO A REGISTERED MARK SHALL LIKEWISE EXERCISE JURISDICTION TO DETERMINE WHETHER THE REGISTRATION OF SAID MARK MAY BE CANCELLED IN ACCORDANCE WITH THIS

ACT. THE FILING OF A SUIT TO ENFORCE THE REGISTERED MARK WITH THE PROPER COURT OR

AGENCY SHALL EXCLUDE ANY OTHER COURT OR AGENCY FROM ASSUMING JURISDICTION OVER A SUBSEQUENTLY FILED PETITION TO CANCEL THE SAME MARK.

ON THE OTHER HAND, THE EARLIER FILING OF PETITION TO CANCEL THE MARK BUREAU OF LEGAL AFFAIRS SHALL NOT CONSTITUTE A PREJUDICIAL QUESTION THAT MUST BE RESOLVED BEFORE AN ACTION TO ENFORCE THE RIGHTS TO SAME REGISTERED MARK MAY BE DECIDED. WITH THE

Q. Is there a presumption of abandonment under the law? A. Yes. If the registered owner of the mark without legitimate reason fails to use the mark within the Philippines, or to cause it to be used in the Philippines by virtue of a license during an uninterrupted period of three (3) years or longer, a petition may be filed for the cancellation of the mark. Q. What if your TM expires and before you register it, someone registers before you file? A. It would depend on the gap. If it’s just a matter of days or months, prior registrant has priority. It long gap, senior registrant has priority. Pagasa Industrial v. CA 1961 - Kaisha registers YKK as trademark for slide fasteners and zippers. 1967- Pagasa files application for registration of YKK for zippers. 1977 - Kaisha files petition for cancellation of Pagasa’s registration claiming both are confusingly similar. Pagasa claims that failure or neglect to assert its trademark rights for more than five years bars Kaisha from filing the petition. Held: Law requires actual commercial use of the mark prior to registration. Here, Kaisha was prior registrant but it did not present proof that it had considerable sales since its first use. The invoices submitted date back to 1957 showing sale of samples. Samples are not for sale and are of no commercial value. Only after more than 7 years too did Kaisha

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file for cancellation. An unreasonable length of time had already passed before the right was asserted. There is a presumption of neglect already amounting to abandonment. Bata Industries v. CA New Olympian sought registration of Bata as trademark for casual rubber shoes, claiming that it has used this mark since 1970. Bata (Canada) opposed this saying that it owns and has not abandoned the trademark Bata. It was shown that Bata shoes were indeed sold in RP prior to WWII, until 1948. Held: Any slight goodwill generated by Bata was completedly abandoned and lost in the more than 35 years that have passed since it last used the trademark. Bata has no Philippine goodwill that would be damaged by the registration of the mark in New Olympian’s favor. SEC. 152. NON-USE OF A MARK WHEN EXCUSED. 152.1. NON-USE OF A MARK MAY BE EXCUSED IF CAUSED BY CIRCUMSTANCES ARISING INDEPENDENTLY OF THE WILL OF THE TRADEMARK OWNER. LACK OF FUNDS SHALL NOT EXCUSE NON-USE OF A MARK. 152.2. THE USE OF THE MARK IN A FORM DIFFERENT FROM THE FORM IN WHICH IT IS REGISTERED, WHICH DOES NOT

ALTER ITS DISTINCTIVE CHARACTER, SHALL NOT BE GROUND FOR CANCELLATION OR REMOVAL OF THE MARK AND SHALL NOT DIMINISH THE PROTECTION GRANTED TO THE MARK.

152.3. THE USE OF A MARK IN CONNECTION WITH ONE OR MORE OF THE GOODS OR SERVICES BELONGING TO THE CLASS IN RESPECT OF WHICH THE MARK IS REGISTERED SHALL PREVENT ITS CANCELLATION OR REMOVAL IN RESPECT OF ALL OTHER GOODS OR SERVICES OF THE SAME CLASS.

152.4. THE USE OF A MARK BY A COMPANY RELATED WITH THE REGISTRANT OR APPLICANT SHALL INURE TO THE LATTER’S BENEFIT, AND SUCH USE SHALL NOT AFFECT THE VALIDITY OF SUCH MARK OR OF ITS REGISTRATION: PROVIDED, THAT SUCH MARK IS NOT USED IN SUCH MANNER AS TO DECEIVE THE PUBLIC. IF USE OF A MARK BY A PERSON IS CONTROLLED BY THE REGISTRANT OR APPLICANT WITH RESPECT TO THE NATURE AND QUALITY OF THE GOODS OR SERVICES, SUCH USE SHALL INURE TO THE BENEFIT OF THE REGISTRANT OR APPLICANT. (N) SEC. 153. REQUIREMENTS OF PETITION; NOTICE AND HEARING. - INSOFAR AS APPLICABLE, THE PETITION FOR SECTION 134 HEREOF, AND NOTICE AND HEARING SHALL BE AS PROVIDED IN SECTION 135 HEREOF.

CANCELLATION SHALL BE IN THE SAME FORM AS THAT PROVIDED IN

SEC. 154. CANCELLATION OF REGISTRATION. - IF THE BUREAU OF LEGAL AFFAIRS FINDS THAT A CASE FOR CANCELLATION WHEN THE ORDER OR JUDGMENT BECOMES FINAL, ANY RIGHT CONFERRED BY SUCH REGISTRATION UPON THE REGISTRANT OR ANY PERSON IN INTEREST OF RECORD SHALL TERMINATE. NOTICE OF CANCELLATION SHALL BE PUBLISHED IN THE IPO GAZETTE.

HAS BEEN MADE OUT, IT SHALL ORDER THE CANCELLATION OF THE REGISTRATION.

SEC. 155. REMEDIES; INFRINGEMENT. - ANY PERSON WHO SHALL, WITHOUT THE CONSENT OF THE OWNER OF THE REGISTERED MARK: 155.1. USE IN COMMERCE ANY REPRODUCTION, COUNTERFEIT, COPY, OR COLORABLE IMITATION OF A REGISTERED MARK OR THE SAME CONTAINER OR A DOMINANT FEATURE THEREOF IN CONNECTION WITH THE SALE, OFFERING FOR SALE, DISTRIBUTION, ADVERTISING OF ANY GOODS OR SERVICES INCLUDING OTHER PREPARATORY STEPS NECESSARY TO CARRY OUT THE SALE OF ANY GOODS OR SERVICES ON OR IN CONNECTION WITH WHICH SUCH USE IS LIKELY TO CAUSE CONFUSION, OR TO CAUSE MISTAKE, OR TO DECEIVE; OR

155.2. REPRODUCE, COUNTERFEIT, COPY OR COLORABLY IMITATE A REGISTERED MARK OR A DOMINANT FEATURE THEREOF

AND APPLY SUCH REPRODUCTION, COUNTERFEIT, COPY OR COLORABLE IMITATION TO LABELS, SIGNS, PRINTS, PACKAGES, WRAPPERS, RECEPTACLES OR ADVERTISEMENTS INTENDED TO BE USED IN COMMERCE UPON OR IN CONNECTION WITH THE SALE, OFFERING FOR SALE, DISTRIBUTION, OR ADVERTISING OF GOODS OR SERVICES ON OR IN CONNECTION WITH

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WHICH SUCH USE IS LIKELY TO CAUSE CONFUSION, OR TO CAUSE MISTAKE, OR TO DECEIVE, SHALL BE LIABLE IN A CIVIL

ACTION FOR INFRINGEMENT BY THE REGISTRANT FOR THE REMEDIES HEREINAFTER SET FORTH: INFRINGEMENT TAKES PLACE AT THE MOMENT ANY OF THE ACTS STATED IN

PROVIDED, THAT THE SUBSECTION 155.1 OR THIS SUBSECTION

ARE COMMITTED REGARDLESS OF WHETHER THERE IS ACTUAL SALE OF GOODS OR SERVICES USING THE INFRINGING MATERIAL.

Q. Is registration needed for infringement cases? A. Yes. Sec. 155 says, “any person who shall, without the consent of the owner of the REGISTERED MARK….” SIMILAR GOODS – DOMINANCY/WHOLISTIC TEST Nestle v. CA Flavor Master v. Master Roast. Applied the dominancy test.

Asia Brewery v. CA & San Miguel Corporation Grino-Aquino, J.

1.

2.

SMC filed a complaint against Asia Brewery Inc. (ABI) for infringement and unfair competition for ABI’s Beer Pale Pilasen or Beer na Beer. SMC cites the following issues (ratio follows issue) SMC Pale Pilsen has rectagular hops and malt design which is similar with ABI’s trademark – Test of Dominancy was used where similarity in size form and color while relevant is not conclusive. Here, “Beer” does not appear in SMC’s TM, “San Miguel” does not appear in ABI’s TM. No similarity in sound, spelling or appearance. No evidence presented by SMC proving that anyone who purchases ABI can be deceived that it is SMC’s. Bottle’s are bottled in amber-colored steinie bottles of 320 ml capacity – steinie bottles are similar but not identical. Also, the bottle is a standard type originally developed in US and not an SMC design. Also, protection is confined to nonfunctional features. Amber color is for preventing transmission of light and provides maximum protection to beer. Also, 320 ml is the standard prescribed under a circular of the DTI. Court also held that there is a substantial price difference. Negre: The case seems to be decided in a wrong manner, by an old lady justice. San Miguel Light comes out in transparent bottles, and there are green and yellow bottles in the market. Also, after consuming 3 beers, you can’t really tell the difference in taste.

DEL MONTE V. CA & SUNSHINE SAUCE Del Monte (US) granted PhilPack (RP) right to manufacture and sell products under Del Monte TM and it registered the TM. Sunshine manufactures sauce too, contained in various kinds of bottles including the Del Monte bottle which it bought from junk shops. Philpack files complaint for TM infringement and for unfair competition. CA held that a side-by-side comparison shows no colorable imitation of TM since design is different. Held: Side-by-side comparison is not the final test of similarity. Average shopper is usually in a hurry and does not inspect every product on the shelf as if he were browsing in a library. So the casual purchaser who is unsuspicious must be the standard. The factors to consider are (1) the training and education of the usual purchaser, (2) the cost of the article and the (3) conditions under which it is usually purchased. Thus, there is TM infringement of the mark but none as to the bottle because although bad faith of

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Sunshine is evident since Del Monte’s bottle states, “Del Monte Corp, Not to be Refilled,” there is still no infringement since the bottle’s design was registered only in the Supplemental Register and this does not vest the registrant with the exclusive right to use the label nor does it give rise to the presumption of validity of the registration.

Converse Rubber v. Universal Rubber Universal Rubber filed an application for the registration of “Universal Converse” for use on rubber shoes and rubber slippers. Converse files an opposition saying that the TM is confusingly similar to the word “Converse”. Converse presents lone witness, a private merchant with stores selling Converse that the sales in her store averaged 12-20 pairs a month purchased mostly by basketball palyers of local private educational institutions. She presents sales invoices as proof. Held: “Converse” is the dominant word which identifies petitioner. Universal admits that Converse has known that the word Converse belongs to and is being used by petitioner. Boundless choice of words are available and when there is no reasonable explanation for the defendant’s choice of such a mark, the inference is inevitable that it wsa chosen to deceive. Sales invoices are best proof of actual sales of Converse products in RP. Sale of 12-20 pairs is not considered insignificant because the shoes are of high expensive quality which not too many people can afford. Such actual use of goods in the local market establishes trademark use which serves as the basis for action aimed at trademark preemption. Q. What is the best proof of use of the product in the country? A. Sales invoices. Q. What if the sales were done over the internet, is it sufficient to establish actual use? A. Yes. There is no need for actual presence in RP. Q. What if the foreign based company does advertising in cable, is it sufficient to prove use of the mark in RP? A. No definite answer, but Converse seems to require actual sales, since it says that sales invoices are the best proof of use in a country. Emerald Garments v. CA HD Lee (Lee Jeans) filed for the cancellation of the TM of Emerald Garments called “Stylistic Mr. Lee” (skirts, jeans, blouses, socks, briefs, jackets, jogging suits). HD Lee claims that the products are so closely related that it will cause confusion, mistake and deception. CA used the test of dominancy saying that if the competing trademark contains the essential or dominant features of another, such that it will cause confusion and deception, then there would be infringement. Thus, since the labels are similar, the CA ruled there was infringement. Held: The SC used the holistic test which says that the entirety of the marks in question must be considered in determining confusing similarity. It ruled that there is no infringement. Emerald’s TM is “Stylistic Mr. Lee” and is not confusingly similar to “Lee.” Since the product is jeans which are not inexpensive, the casual buyer is more cautious and discriminating. Confusion and deception is less likely. The average consumer also buys his jeans by brand. Also, “Lee” is primarily a surname, so HD Lee can’t acquire exclusive ownership of the term. In addition, HD Lee failed to show prior actual commercial use of its “Lee” TM in RP before it filed its application.

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Q. Would the result have been different had a different test been used? A. It seems that way, since the CA used dominancy test and the result was different from the SC decision which used the holistic test. Q. Why was this case decided differently from the Converse? A. In Converse, there was proof of actual prior commercial use. Lim Hoa v. Director Lim Hoa filed for application of registration of TM consisting of two midget roosters in combat with the word Bantam, for food seasoning. Agricom Dev’t opposed the application saying that it is confusingly similar with its own TM which is a pictorial representation of a hen with the words “Hen Brand” and “Marca Manok” also used in food seasoning. Held: There is such similarity between them as to cause confusion. In the test of dominancy, similarity in size, form, color, while relevant, is not conclusive. If the competing trademark contains the main or essential dominant features of another, infringement takes place. Duplication is not necessary, not is it necessary that the infringing label should suggest an effort to imitate. Also, the product is purchased by cooks and household help, sometimes illiterate who are guided by pictorial representations and the sound of the word. There is also greater danger here since the products are cheap. Q. What was the factor considered by the court? A. Same animals and similar products. Q. Would there be infringement in crocodile and alligator? A. Yes. Q. Tiger and lion? A. Yes. Q. Would the ruling be the same if the case involved leather goods? A. It may have been decided differently since the case would involve expensive products where the buyers are wary and not illiterate. Philips Export v. CA & SEC Philips Export (Netherlands) owns TM for “Philips,” for electrical products. Standard Philips (RP) was issued a certificate of registration by SEC for the business of chain rollers, belts, bearing. PE filed a complaint asking for the cancellation of SP’s name and filed for a petition for injunction. SEC ruled against PE, saying that Sec. 18 of the Corp. Code is applicable only when the corporate names are identical. Held: The right to use a corporate name is a property right, a right in rem which it may assert. Corp Code gives two requirements: (1) That complaint acquired a prior right over such name and (2) that the proposed name is either identical, deceptively or confusingly similar, or patently deceptive. PE’s prior adoption of the term “Philips” is not in doubt, and the test as to whether it would be confusing is the ordinary person. “Philips” is indeed the dominant word. Note that although no proof was presented of actual confusion, it is sufficient that confusion is probably or likely to occur. Q. Where did the case emanate? A. From SEC.

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Q. Does SEC have jurisdiction over the case? A. Yes because it involves corporate names. Q. Who has jurisdiction over cases involving corporate names under PD 902-A, the SEC or the RTC? A. This is still a grey area. Q. Which test should be applied in this case? A. The court seemed to apply the dominancy test. Note that when goods are similar and the marks are identical, Sec. 147.1 gives a presumption of the likelihood of confusion. Spectrum of the Likelihood of Confusion

Same goods

Different goods

Identical marks

Different marks

NEGRE: THERE SHOULD BE NO DIFFERENCE BETWEEN THE DOMINANCY AND HOLISTIC TEST. WITH EITHER TEST, YOU SHOULD ARRIVE AT THE SAME CONCLUSION, BASED ON THIS SPECTRUM. DISSIMILAR GOODS Polaroid v. Polarad Polaroid (Delaware) is registrant of the name Polaroid for the use of sheet polarizing material, lamps, optical lans. It files an action for injunction against Polarad claiming that its use infringed on its trademark and is unfair competition. Polarad is engaged in manufacture of microwave generating devices and TV studio equipment. Polarad admits that he had some knowledge of plaintiff’s use of the name Polaroid, but not as to electronics. Polarad used the name as early as 1945, but there was no protest. It registered in 1953, and plaintiff delayed suit until 1956. Polaroid claims that laches does not apply in tm cases since injunction, rather than damages, are sought. Held: Plaintiff is guilty of laches. Doctrine of laches has no such reach as claimed when the goods are different. TM owner’s interest is in preventing such use because he may wish to preempt the market for later exploitation. Here, owner’s rights in such appendant markets are easily lost. They must be asserted early, lest they be made the means of reaping a harvest which others have sown. Q. What are the factors cited by the court in deciding infringement cases when the products are different? A. 1. Strength of the mark 2. Degree of similarity between the two marks 3. Proximity of the products 4. Likelihood that the prior owner will bridge the gap 5. Actual confusion 6. Defendant’s good faith in adopting its own mark 7. Quality of the defendant’s product 8. Sophistication of the buyers

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QUALITY INNS INTERNATIONAL, INC. v. McDONALD’S CORPORATION On September 21, 1987 , Quality Inns International, Inc. announced a new chain of economy hotels to be marketed under the name “McSleep Inn.” McDonald’s Corporation responded immediately claiming that the name “McSleep” infringed on the McDonald’s family of marks that are characterized by the prefix “Mc” combined with a generic word. Robert C. Hazard, Jr., CEO of Quality International in 1980, claimed he was driving down the highway when it hit him, “to name the new economy chain McSleep,” and had no intent of using McDonald’s goodwill to its advantage. McDonald’s contends that it is the owner of a family of marks each of which is formulated by combining the prefix “Mc” with a generic word to form a fanciful trademark or service mark. It contends that “McSleep Inn” that had been adopted by Quality International is likely to cause confusion and that Quality International selected the word Mc Sleep deliberately to trade on the goodwill and reputation of McDonald’s. Conclusion: The Court finds and concludes that (1) McDonald’s is entitled to enforce its family of marks that are characterized by the combination of the prefix “Mc” with a generic word; (2) the name McSleep Inn is likely to cause an appreciable number of the public to be confused by believing McSleep Inn is sponsored, associated, affiliated, connected, or endorsed by McDonald’s; and (3) the adoption and use by Quality International of the name McSleep Inn was a deliberate attempt to benefit by the good will and reputation of McDonald’s. The Court found trademark infringement, unfair competition, and dilution under the Illinois statute. Q. In this case, what were the 7 factors applied? Similar with the earlier ones given. These are considered in determining the likelihood of confusion: (1) the strength of distinctiveness of the mark, (2) the similarity of the two marks, (3) the similarity of the goods or services with the marks identify, (4) the similarity of the facilities used by the parties in conducting their businesses, (5) the similarity of advertising used by the parties, (6) the defendant’s intent, (7) and actual confusion. If we apply the facts of the case to this statute, we will see that some of these conditions have been met. Q. Can bad faith in trademark infringement cases be presumed? A. No, it should be proven. Q. Are surveys admissible? Since in the Quality Inn case, a survey was presented by McDonald’s which showed that people associated McDonald’s with Quality Inn’s McSleep. A. Yes, if accompanied with testimony of the person conducting the survey, or if it falls under the commercial list exception.

SEC. 156. ACTIONS, AND DAMAGES AND INJUNCTION FOR INFRINGEMENT. 156.1. THE OWNER OF A REGISTERED MARK MAY RECOVER DAMAGES FROM ANY PERSON WHO INFRINGES HIS RIGHTS, AND THE MEASURE OF THE DAMAGES SUFFERED SHALL BE EITHER THE REASONABLE PROFIT WHICH THE COMPLAINING PARTY WOULD HAVE MADE, HAD THE DEFENDANT NOT INFRINGED HIS RIGHTS, OR THE PROFIT WHICH THE DEFENDANT ACTUALLY MADE OUT OF THE INFRINGEMENT, OR IN THE EVENT SUCH MEASURE OF DAMAGES CANNOT BE READILY

ASCERTAINED WITH REASONABLE CERTAINTY, THEN THE COURT MAY AWARD AS DAMAGES A REASONABLE PERCENTAGE BASED UPON THE AMOUNT OF GROSS SALES OF THE DEFENDANT OR THE VALUE OF THE SERVICES IN CONNECTION WITH WHICH THE MARK OR TRADE NAME WAS USED IN THE INFRINGEMENT OF THE RIGHTS OF THE COMPLAINING PARTY.

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156.2. ON APPLICATION OF THE COMPLAINANT, THE COURT MAY IMPOUND DURING THE PENDENCY OF THE ACTION, SALES INVOICES AND OTHER DOCUMENTS EVIDENCING SALES. (N) 156.3. IN CASES WHERE ACTUAL INTENT TO MISLEAD THE PUBLIC OR TO DEFRAUD THE COMPLAINANT IS SHOWN, IN THE DISCRETION OF THE COURT, THE DAMAGES MAY BE DOUBLED.

156.4. THE COMPLAINANT, UPON PROPER SHOWING, MAY ALSO BE GRANTED INJUNCTION. Q. What are the types of remedies granted for infringement? A. 1) Damages, 2) impounding of sales invoice, 3) injunction. Q. What kind of damages are compensable? A. Only loss of profit. But when there is intent to mislead, double the profit. NOTE: It is thus evident that even when there is no intent to mislead, there can be infringement. Q. Can the court award damages when there is no notice to infringer? Like when he is not aware that he is infringing? A. It appears that the court can do this, since intent to mislead is not essential. (?) SEC. 157. POWER OF COURT TO ORDER INFRINGING MATERIAL DESTROYED. 157.1. IN ANY ACTION ARISING UNDER THIS ACT, IN WHICH A VIOLATION OF ANY RIGHT OF THE OWNER OF THE REGISTERED MARK IS ESTABLISHED, THE COURT MAY ORDER THAT GOODS FOUND TO BE INFRINGING BE, WITHOUT COMPENSATION OF ANY SORT, DISPOSED OF OUTSIDE THE CHANNELS OF COMMERCE IN SUCH A MANNER AS TO AVOID ANY HARM CAUSED TO THE RIGHT HOLDER, OR DESTROYED; AND ALL LABELS, SIGNS, PRINTS, PACKAGES, WRAPPERS, RECEPTACLES AND ADVERTISEMENTS IN THE POSSESSION OF THE DEFENDANT, BEARING THE REGISTERED MARK OR TRADE NAME OR ANY REPRODUCTION, COUNTERFEIT, COPY OR COLORABLE IMITATION THEREOF, ALL PLATES, MOLDS, MATRICES AND OTHER MEANS OF MAKING THE SAME, SHALL BE DELIVERED UP AND DESTROYED. 157.2. IN REGARD TO COUNTERFEIT GOODS, THE SIMPLE REMOVAL OF THE TRADEMARK AFFIXED SHALL NOT BE SUFFICIENT OTHER THAN IN EXCEPTIONAL CASES WHICH SHALL BE DETERMINED BY THE REGULATIONS, TO PERMIT THE RELEASE OF THE GOODS INTO THE CHANNELS OF COMMERCE. SEC. 158. DAMAGES; REQUIREMENT OF NOTICE. - IN ANY SUIT FOR INFRINGEMENT, THE OWNER OF THE REGISTERED MARK SHALL NOT BE ENTITLED TO RECOVER PROFITS OR DAMAGES UNLESS THE ACTS HAVE BEEN COMMITTED WITH KNOWLEDGE THAT SUCH IMITATION IS LIKELY TO CAUSE CONFUSION, OR TO CAUSE MISTAKE, OR TO DECEIVE.

SUCH KNOWLEDGE IS

PRESUMED IF THE REGISTRANT GIVES NOTICE THAT HIS MARK IS REGISTERED BY DISPLAYING WITH THE MARK THE WORDS

"REGISTERED MARK" OR THE LETTER R WITHIN A CIRCLE OR IF THE DEFENDANT HAD OTHERWISE ACTUAL NOTICE OF THE

REGISTRATION.

SEC. 159. LIMITATIONS TO ACTIONS FOR INFRINGEMENT. - NOTWITHSTANDING ANY OTHER PROVISION OF THIS ACT, THE

REMEDIES GIVEN TO THE OWNER OF A RIGHT INFRINGED UNDER THIS ACT SHALL BE LIMITED AS FOLLOWS:

159.1 NOTWITHSTANDING THE PROVISIONS OF SECTION 155 HEREOF, A REGISTERED MARK SHALL HAVE NO EFFECT AGAINST ANY PERSON WHO, IN GOOD FAITH, BEFORE THE FILING DATE OR THE PRIORITY DATE, WAS USING THE MARK FOR THE PURPOSES OF HIS BUSINESS OR ENTERPRISE: PROVIDED, THAT HIS RIGHT MAY ONLY BE TRANSFERRED OR ASSIGNED TOGETHER WITH HIS ENTERPRISE OR BUSINESS OR WITH THAT PART OF HIS ENTERPRISE OR BUSINESS IN WHICH THE MARK IS USED.

159.2 WHERE AN INFRINGER WHO IS ENGAGED SOLELY IN THE BUSINESS OF PRINTING THE MARK OR OTHER INFRINGING

MATERIALS FOR OTHERS IS AN INNOCENT INFRINGER, THE OWNER OF THE RIGHT INFRINGED SHALL BE ENTITLED AS AGAINST SUCH INFRINGER ONLY TO AN INJUNCTION AGAINST FUTURE PRINTING.

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159.3. WHERE THE INFRINGEMENT COMPLAINED OF IS CONTAINED IN OR IS PART OF PAID ADVERTISEMENT IN A NEWSPAPER, MAGAZINE, OR OTHER SIMILAR PERIODICAL OR IN AN ELECTRONIC COMMUNICATION, THE REMEDIES OF THE OWNER OF THE RIGHT INFRINGED AS AGAINST THE PUBLISHER OR DISTRIBUTOR OF SUCH NEWSPAPER, MAGAZINE, OR OTHER SIMILAR PERIODICAL OR ELECTRONIC COMMUNICATION SHALL BE LIMITED TO AN INJUNCTION AGAINST THE PRESENTATION OF SUCH ADVERTISING MATTER IN FUTURE ISSUES OF SUCH NEWSPAPERS, MAGAZINES, OR OTHER

SIMILAR PERIODICALS OR IN FUTURE TRANSMISSIONS OF SUCH ELECTRONIC COMMUNICATIONS.

THE LIMITATIONS OF PROVIDED, THAT SUCH INJUNCTIVE RELIEF SHALL NOT BE AVAILABLE TO THE OWNER OF THE RIGHT INFRINGED WITH RESPECT TO AN ISSUE OF A NEWSPAPER, MAGAZINE,

THIS SUBPARAGRAPH SHALL APPLY ONLY TO INNOCENT INFRINGERS:

OR OTHER SIMILAR PERIODICAL OR AN ELECTRONIC COMMUNICATION CONTAINING INFRINGING MATTER WHERE RESTRAINING THE DISSEMINATION OF SUCH INFRINGING MATTER IN ANY PARTICULAR ISSUE OF SUCH PERIODICAL OR IN AN ELECTRONIC COMMUNICATION WOULD DELAY THE DELIVERY OF SUCH ISSUE OR TRANSMISSION OF SUCH ELECTRONIC COMMUNICATION IS CUSTOMARILY CONDUCTED IN ACCORDANCE WITH THE SOUND BUSINESS PRACTICE, AND NOT DUE TO ANY METHOD OR DEVICE ADOPTED TO EVADE THIS SECTION OR TO PREVENT OR DELAY THE ISSUANCE OF AN INJUNCTION OR RESTRAINING ORDER WITH RESPECT TO SUCH INFRINGING MATTER. (N)

SEC. 160. RIGHT OF FOREIGN CORPORATION TO SUE IN TRADEMARK OR SERVICE MARK ENFORCEMENT ACTION. - ANY FOREIGN NATIONAL OR JURIDICAL PERSON WHO MEETS THE REQUIREMENTS OF SECTION 3 OF THIS ACT AND DOES NOT ENGAGE IN BUSINESS IN THE PHILIPPINES MAY BRING A CIVIL OR ADMINISTRATIVE ACTION HEREUNDER FOR OPPOSITION, CANCELLATION, INFRINGEMENT, UNFAIR COMPETITION, OR FALSE DESIGNATION OF ORIGIN AND FALSE DESCRIPTION, WHETHER OR NOT IT IS LICENSED TO DO BUSINESS IN THE PHILIPPINES UNDER EXISTING LAWS. Q. Converse and Canon required prior actual use in RP of the mark in order for the foreign oppositor’s case to prosper. Is actual use in RP still required? A. It appears that this is no longer a requirement, since the foreign national who sues under this section is required not to engage in business in the Philippines. Yu v. CA Philip Yu is the exclusive distributor of House of Mayfair wallcovering products. Unisia imported the same goods via FNF Trading and sold the products in the domestic market. Yu filed for injunction. Unisia claims ignorance of the exclusive contract. Held: The right to perform an exclusive distributorship agreement and to reap the profits resulting from such performance are proprietary rights which a party may protect and which may not be diminished by the expedient act of utilizing a person to obtain goods from the supplier to defeat the very purpose for which the exclusive distributorship was conceptualized at the expense of the exclusive distributor. Also, the House of Mayfair in England was duped into believing that the goods ordered through FNF Trading was to be shipped to Nigeria only but the goods were actually sold in the Philippines. Q. What does this case have to do with IP rights? (actual question asked by Negre) A. IP rights, like exclusive distributorship, are proprietary rights which a party may protect. Q. Co. A based in Singapore has exclusive distribution with Co. B in RP for product “D.” Can Co. B prevent Co. C from bringing the product to the Philippines? A. Yes. Q. What if C is not aware of the exclusive distributorship? A. From the case, it seems that intent is required. (but answer changes later) Q. What if the product is a life-saving drug imported by the government? A. The government may probably import it by exerting its police power.

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Q. Where do you draw the line? A. Maybe for life-saving drugs, or important technologies like fast growing rice palay. If not, government will be depriving persons of proprietary rights (property) without due process. Q. What does TRIPS and WTO provide on parallel importation? A. Once the product is distributed, he can no longer control resale because the right is limited to the first distribution. Q. So should B have been able to prevent importation, since after the first sale, there is no more right to control sale? Won’t there be a monopoly if this is the case? A. Yes, it does seem that way, because only the government, in the exercise of police power, can deprive persons of property rights without due process.

SEC. 161. AUTHORITY TO DETERMINE RIGHT TO REGISTRATION. - IN ANY ACTION INVOLVING A REGISTERED MARK, THE COURT MAY DETERMINE THE RIGHT TO REGISTRATION, ORDER THE CANCELLATION OF A REGISTRATION, IN WHOLE OR IN PART, AND OTHERWISE RECTIFY THE REGISTER WITH RESPECT TO THE REGISTRATION OF ANY PARTY TO THE ACTION IN THE EXERCISE OF THIS. JUDGMENT AND ORDERS SHALL BE CERTIFIED BY THE COURT TO THE DIRECTOR, WHO SHALL MAKE APPROPRIATE ENTRY UPON THE RECORDS OF THE BUREAU, AND SHALL BE CONTROLLED THEREBY. SEC. 162. ACTION FOR FALSE OR FRAUDULENT DECLARATION. - ANY PERSON WHO SHALL PROCURE REGISTRATION IN THE OFFICE OF A MARK BY A FALSE OR FRAUDULENT DECLARATION OR REPRESENTATION, WHETHER ORAL OR IN WRITING, OR BY ANY FALSE MEANS, SHALL BE LIABLE IN A CIVIL ACTION BY ANY PERSON INJURED THEREBY FOR ANY DAMAGES SUSTAINED IN CONSEQUENCE THEREOF. 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. SEC. 164. NOTICE OF FILING SUIT GIVEN TO THE DIRECTOR. - IT SHALL BE THE DUTY OF THE CLERKS OF SUCH COURTS WITHIN ONE (1) MONTH AFTER THE FILING OF ANY ACTION, SUIT, OR PROCEEDING INVOLVING A MARK REGISTERED UNDER THE PROVISIONS OF THIS ACT, TO NOTIFY THE DIRECTOR IN WRITING SETTING FORTH: THE NAMES AND ADDRESSES OF THE LITIGANTS AND DESIGNATING THE NUMBER OF THE REGISTRATION OR REGISTRATIONS AND WITHIN ONE (1) MONTH AFTER THE JUDGMENT IS ENTERED OR AN APPEAL IS TAKEN, THE CLERK OF COURT SHALL GIVE NOTICE THEREOF TO THE OFFICE, AND THE LATTER SHALL ENDORSE THE SAME UPON THE FILEWRAPPER OF THE SAID REGISTRATION OR REGISTRATIONS AND INCORPORATE THE SAME AS A PART OF THE CONTENTS OF SAID FILEWRAPPER. (N)

SEC. 165. TRADE NAMES OR BUSINESS NAMES. 165.1. A NAME OR DESIGNATION MAY NOT BE USED AS A TRADE NAME IF BY ITS NATURE OR THE USE TO WHICH SUCH NAME OR DESIGNATION MAY BE PUT, IT IS CONTRARY TO PUBLIC ORDER OR MORALS AND IF, IN PARTICULAR, IT IS LIABLE TO DECEIVE TRADE CIRCLES OR THE PUBLIC AS TO THE NATURE OF THE ENTERPRISE IDENTIFIED BY THAT NAME. 165.2. (A) NOTWITHSTANDING ANY LAWS OR REGULATIONS PROVIDING FOR ANY OBLIGATION TO REGISTER TRADE NAMES, SUCH NAMES SHALL BE PROTECTED, EVEN PRIOR TO OR WITHOUT REGISTRATION, AGAINST ANY UNLAWFUL ACT COMMITTED BY THIRD PARTIES. (B) IN PARTICULAR, ANY SUBSEQUENT USE OF THE TRADE NAME BY A THIRD PARTY, WHETHER AS A TRADE NAME OR A MARK OR COLLECTIVE MARK, OR ANY SUCH USE OF A SIMILAR TRADE NAME OR MARK, LIKELY TO MISLEAD THE PUBLIC, SHALL BE DEEMED UNLAWFUL. 165.3. THE REMEDIES PROVIDED FOR IN SECTIONS 153 TO 156 AND SECTIONS 166 AND 167 SHALL APPLY MUTATIS

MUTANDIS.

165.4. ANY CHANGE IN THE OWNERSHIP OF A TRADE NAME SHALL BE MADE WITH THE TRANSFER OF THE ENTERPRISE OR THE PROVISIONS OF SUBSECTIONS 149.2 TO 149.4 SHALL APPLY MUTATIS MUTANDIS.

PART THEREOF IDENTIFIED BY THAT NAME.

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SEC. 166. GOODS BEARING INFRINGING MARKS OR TRADE NAMES. - NO ARTICLE OF IMPORTED MERCHANDISE WHICH SHALL COPY OR SIMULATE THE NAME OF ANY DOMESTIC PRODUCT, OR MANUFACTURER, OR DEALER, OR WHICH SHALL COPY OR SIMULATE A MARK REGISTERED IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT, OR SHALL BEAR A MARK OR TRADE NAME CALCULATED TO INDUCE THE PUBLIC TO BELIEVE THAT THE ARTICLE IS MANUFACTURED IN THE PHILIPPINES, OR THAT IT IS MANUFACTURED IN ANY FOREIGN COUNTRY OR LOCALITY OTHER THAN THE COUNTRY OR LOCALITY WHERE IT IS IN FACT MANUFACTURED, SHALL BE ADMITTED TO ENTRY AT ANY CUSTOMHOUSE OF THE PHILIPPINES.

IN ORDER TO AID THE OFFICERS

OF THE CUSTOMS SERVICE IN ENFORCING THIS PROHIBITION, ANY PERSON WHO IS ENTITLED TO THE BENEFITS OF THIS ACT,

MAY REQUIRE THAT HIS NAME AND RESIDENCE, AND THE NAME OF THE LOCALITY IN WHICH HIS GOODS ARE MANUFACTURED, A COPY OF THE CERTIFICATE OF REGISTRATION OF HIS MARK OR TRADE NAME, TO BE RECORDED IN BOOKS WHICH SHALL BE

BUREAU OF CUSTOMS, UNDER SUCH REGULATIONS AS THE COLLECTOR OF CUSTOMS WITH THE SECRETARY OF FINANCE SHALL PRESCRIBE, AND MAY FURNISH TO THE SAID BUREAU FACSIMILES OF HIS NAME, THE NAME OF THE LOCALITY IN WHICH HIS GOODS ARE MANUFACTURED, OR HIS REGISTERED MARK OR TRADE NAME, AND THEREUPON THE COLLECTOR OF CUSTOMS SHALL CAUSE ONE (1) OR MORE COPIES OF THE SAME TO BE TRANSMITTED TO EACH COLLECTOR OR TO OTHER PROPER OFFICER OF THE BUREAU OF CUSTOMS. (SEC. 35, R. A. NO. 166) KEPT FOR THIS PURPOSE IN THE

APPROVAL OF THE

Q. Can the customs seize the goods? A. It appears under this section that all they can do is to prevent entry. But under Art. 9 of the Paris Convention, “All goods unlawfully bearing a trademark or trade name shall be seized on importation into those countries of the Union where such mark or trade name is entitled to legal protection.” Note that under the Paris convention, authorities shall not be bound to effect seizure. If the legislation of a country does not permit seizure on importation, it shall be replaced by prohibition of importation or by seizure on inside the country. SEC. 167. COLLECTIVE MARKS. 167.1. SUBJECT TO SUBSECTIONS 167.2 AND 167.3, SECTIONS 122 TO 164 AND 166 SHALL APPLY TO COLLECTIVE MARKS, EXCEPT THAT REFERENCES THEREIN TO "MARK" SHALL BE READ AS "COLLECTIVE MARK." 167.2 (A) AN APPLICATION FOR REGISTRATION OF A COLLECTIVE MARK SHALL DESIGNATE THE MARK AS A COLLECTIVE MARK AND SHALL BE ACCOMPANIED BY A COPY OF THE AGREEMENT, IF ANY, GOVERNING THE USE OF THE COLLECTIVE MARK. (B) THE REGISTERED OWNER OF A COLLECTIVE MARK SHALL NOTIFY THE DIRECTOR OF ANY CHANGES MADE IN RESPECT OF THE AGREEMENT REFERRED TO IN PARAGRAPH (A). 167.3. IN ADDITION TO THE GROUNDS PROVIDED IN SECTION 149, THE COURT SHALL CANCEL THE REGISTRATION OF A COLLECTIVE MARK IF THE PERSON REQUESTING THE CANCELLATION PROVES THAT ONLY THE REGISTERED OWNER USES THE MARK, OR THAT HE USES OR PERMITS ITS USE IN CONTRAVENTION OF THE AGREEMENTS REFERRED TO IN

SUBSECTION 166.2 OR THAT HE USES OR PERMITS ITS USE IN A MANNER LIABLE TO DECEIVE TRADE CIRCLES OR THE PUBLIC AS TO THE ORIGIN OR ANY OTHER COMMON CHARACTERISTICS OF THE GOODS OR SERVICES CONCERNED.

167.4. THE REGISTRATION OF A COLLECTIVE MARK, OR AN APPLICATION THEREFOR SHALL NOT BE THE SUBJECT OF A LICENSE CONTRACT.

SEC. 168. UNFAIR COMPETITION, RIGHTS, REGULATION AND REMEDIES. 168.1. A PERSON WHO HAS IDENTIFIED IN THE MIND OF THE PUBLIC THE GOODS HE MANUFACTURES OR DEALS IN, HIS BUSINESS OR SERVICES FROM THOSE OF OTHERS, WHETHER OR NOT A REGISTERED MARK IS EMPLOYED, HAS A PROPERTY RIGHT IN THE GOODWILL OF THE SAID GOODS, BUSINESS OR SERVICES SO IDENTIFIED, WHICH WILL BE PROTECTED IN THE SAME MANNER AS OTHER PROPERTY RIGHTS. 168.2. ANY PERSON WHO SHALL EMPLOY DECEPTION OR ANY OTHER MEANS CONTRARY TO GOOD FAITH BY WHICH HE SHALL PASS OFF THE GOODS MANUFACTURED BY HIM OR IN WHICH HE DEALS, OR HIS BUSINESS, OR SERVICES FOR THOSE

OF THE ONE HAVING ESTABLISHED SUCH GOODWILL, OR WHO SHALL COMMIT ANY ACTS CALCULATED TO PRODUCE SAID RESULT, SHALL BE GUILTY OF UNFAIR COMPETITION, AND SHALL BE SUBJECT TO AN ACTION THEREFOR.

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168.3. IN PARTICULAR, AND WITHOUT IN ANY WAY LIMITING THE SCOPE OF PROTECTION AGAINST UNFAIR COMPETITION, THE FOLLOWING SHALL BE DEEMED GUILTY OF UNFAIR COMPETITION: (A) ANY PERSON, WHO IS SELLING HIS GOODS AND GIVES 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 TO BELIEVE 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, OR ANY SUBSEQUENT VENDOR OF SUCH GOODS OR ANY AGENT OF ANY VENDOR ENGAGED IN SELLING SUCH GOODS WITH A LIKE PURPOSE;

(B) ANY PERSON WHO BY ANY ARTIFICE, OR DEVICE, OR WHO EMPLOYS ANY OTHER MEANS CALCULATED TO INDUCE THE FALSE BELIEF THAT SUCH PERSON IS OFFERING THE SERVICES OF ANOTHER WHO HAS IDENTIFIED SUCH SERVICES IN THE MIND OF THE PUBLIC; OR

(C) ANY PERSON WHO SHALL MAKE ANY FALSE STATEMENT IN THE COURSE OF TRADE OR WHO SHALL COMMIT ANY OTHER ACT CONTRARY TO GOOD FAITH OF A NATURE CALCULATED TO DISCREDIT THE GOODS, BUSINESS OR SERVICES OF ANOTHER. 168.4. THE REMEDIES PROVIDED BY SECTIONS 156, 157 AND 161 SHALL APPLY MUTATIS MUTANDIS. Q. What is unfair competition? A. It is the passing off of one’s goods as those of another. COMPANA GENERAL DE TABACOS V. ALHAMBRA CIGAR Compania files case against Alhambra who sold cigarettes bearing the words “Alhambra Isabelas,” for TM infringement and unfair competition, arising from the use of the word “Isabelas.” Held: In infringement case, the action does not proceed on the theory that the public will be defrauded, although that may be the result. It is on the claim that the plaintiff’s right on the mark ahs been invaded. There is no need to proof anything more than right to the exclusive use. No proof of fraud or intent to defraud is necessary. In unfair competition, the action is exclusively based on fraud. A violation of TM cannot be carried on with an action of unfair competition based on similarity to the plaintiff’s TM. The law does not permit these two actions to be maintained on the same facts. (As to infringement case) There can be no registration of a TM which represents the geographical place of production or the origin of the product or is merely the description. Also, there is no secondary meaning of the word “Isabela” acquired by long association with plaintiff’s cigarettes. There are also other cigarettes using “Isabela.” Q. Can a person file for both trademark infringement and unfair competition? A. Yes, they are not mutually exclusive. Q. Can you file for both in the same action? A. Yes. But in Alhambra, if the action is based on the mark, it is only an action for infringement.

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Q. Compare infringement and unfair competition. A. See chart.

What is?

Trademark Infringement Unauthorized use of a trademark

Bad faith/intent necessary?

No.

Registration required?

Prior registration is required

of

the

trademark

Unfair Competition Passing off of one’s product for another based on general appearance Intent to deceive/Fraudulent intent is essential Registration is not necessary

SEC. 169. FALSE DESIGNATIONS OF ORIGIN; FALSE DESCRIPTION OR REPRESENTATION. 169.1. ANY PERSON WHO, ON OR IN CONNECTION WITH ANY GOODS OR SERVICES, OR ANY CONTAINER FOR GOODS, USES IN COMMERCE ANY WORD, TERM, NAME, SYMBOL, OR DEVICE, OR ANY COMBINATION THEREOF, OR ANY FALSE DESIGNATION OF ORIGIN, FALSE OR MISLEADING DESCRIPTION OF FACT, OR FALSE OR MISLEADING REPRESENTATION OF FACT, WHICH: (A) IS LIKELY TO CAUSE CONFUSION, OR TO CAUSE MISTAKE, OR TO DECEIVE AS TO THE AFFILIATION, CONNECTION, OR ASSOCIATION OF SUCH PERSON WITH ANOTHER PERSON, OR AS TO THE ORIGIN, SPONSORSHIP, OR APPROVAL OF HIS OR HER GOODS, SERVICES, OR COMMERCIAL ACTIVITIES BY ANOTHER PERSON; OR (B) IN COMMERCIAL ADVERTISING OR PROMOTION, MISREPRESENTS THE NATURE, CHARACTERISTICS, QUALITIES, OR GEOGRAPHIC ORIGIN OF HIS OR HER OR ANOTHER PERSON’S GOODS, SERVICES, OR COMMERCIAL ACTIVITIES, SHALL BE LIABLE TO A CIVIL ACTION FOR DAMAGES AND INJUNCTION PROVIDED IN SECTIONS 156 AND 157 OF THIS ACT BY ANY PERSON WHO BELIEVES THAT HE OR SHE IS OR LIKELY TO BE DAMAGED BY SUCH ACT. 169.2. ANY GOODS MARKED OR LABELED IN CONTRAVENTION OF THE PROVISIONS OF THIS SECTION SHALL NOT BE PHILIPPINES OR ADMITTED ENTRY AT ANY CUSTOMHOUSE OF THE PHILIPPINES. THE OWNER, IMPORTER, OR CONSIGNEE OF GOODS REFUSED ENTRY AT ANY CUSTOMHOUSE UNDER THIS SECTION MAY HAVE ANY RECOURSE UNDER THE CUSTOMS REVENUE LAWS OR MAY HAVE THE REMEDY GIVEN BY THIS ACT IN CASES INVOLVING GOODS REFUSED ENTRY OR SEIZED. (SEC. 30, R. A. NO. 166A) IMPORTED INTO THE

SEC. 170. PENALTIES. - INDEPENDENT OF THE CIVIL AND ADMINISTRATIVE SANCTIONS IMPOSED BY LAW, A CRIMINAL (2) YEARS TO FIVE (5) YEARS AND A FINE RANGING FROM FIFTY THOUSAND PESOS (P50,000) TO TWO HUNDRED THOUSAND PESOS (P200,000), SHALL BE IMPOSED ON ANY PERSON WHO IS FOUND GUILTY OF COMMITTING ANY OF THE ACTS MENTIONED IN SECTION 155, SECTION 168 AND SUBSECTION 169.1. PENALTY OF IMPRISONMENT FROM TWO

Q. What actions are available to TM holders? A. Civil, criminal and administrative cases. Q. What is the venue? A. For civil cases, either MTC (below P300K, below P400K for Manila) or RTC depending on the amount. For criminal cases, it is unclear if jurisdiction should depend on the imprisonment or fine. For administrative cases, the DTI for tradenames, the IPO for trademarks.

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PRIMER ON INTERNET RELATED TRADE MARK ISSUES THE

PROTECTION

OF

JOINT RECOMMENDATION CONCERNING PROVISIONS ON MARKS, AND OTHER INDUSTRIAL PROPERTY RIGHTS IN SIGNS,

ON THE

INTERNET

Q. What are some of the important provisions discussed in Joint Recommendation? A. Only Article 2 and 3 were discussed in class. They are: Article 2 Use of a Sign on the Internet in a Member State Use of a sign on the Internet shall constitute use in a Member State for the purposes of these provisions, only if the use has a commercial effect in that Member State as described in Article 3. Article 3 Factors for Determining Commercial Effect in a Member State

(1) [Factors] In determining whether use of a sign on the Internet has a commercial effect in a Member State, the competent authority shall take into account all relevant circumstances. Circumstances that may be relevant include, but are not limited to: (a) circumstances indicating that the user of the sign is doing, or has undertaken significant plans to do, business in the Member State in relation to goods or services which are identical or similar to those for which the sign is used on the Internet. (b) the level and character of commercial activity of the user in relation to the Member State, including: (i)whether the user is actually serving customers located in the Member State or has entered into other commercially motivated relationships with persons located in the Member State; (ii)whether the user has stated, in conjunction with the use of the sign on the Internet, that he does not intend to deliver the goods or services offered to customers located in the Member State and whether he adheres to his stated intent; (iii)whether the user offers post-sales activities in the Member State, such as warranty or service; (iv)whether the user undertakes further commercial activities in the Member State which are related to the use of the sign on the Internet but which are not carried out over the Internet. (c) the connection of an offer of goods or services on the Internet with the Member State, including: (i)whether the goods or services offered can be lawfully delivered in the Member State; (ii)whether the prices are indicated in the official currency of the Member State. (d) the connection of the manner of use of the sign on the Internet with the Member State, including: (i)whether the sign is used in conjunction with means of interactive contact which are accessible to Internet users in the Member State;

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(ii)whether the user has indicated, in conjunction with the use of the sign, an address, telephone number or other means of contact in the Member State; (iii)whether the sign is used in connection with a domain name which is registered under the ISO Standard country code 3166 Top Level Domain referring to the Member State; (iv)whether the text used in conjunction with the use of the sign is in a language predominantly used in the Member State; (v)whether the sign is used in conjunction with an Internet location which has actually been visited by Internet users located in the Member State.

(e) the relation of the use of the sign on the Internet with a right in that sign in the Member State, including: (i)whether the use is supported by that right; (ii)whether, where the right belongs to another, the use would take unfair advantage of, or unjustifiably impair, the distinctive character or the reputation of the sign that is the subject of that right.

(2) [Relevance of Factors] The above factors, which are guidelines to assist the competent authority to determine

whether the use of a sign has produced a commercial effect in a Member State, are not pre-conditions for reaching that determination. Rather, the determination in each case will depend upon the particular circumstances of that case. In some cases all of the factors may be relevant. In other cases some of the factors may be relevant. In still other cases none of the factors may be relevant, and the decision may be based on additional factors that are not listed in paragraph (1), above. Such additional factors may be relevant, alone, or in combination with one or more of the factors listed in paragraph (1), above.

Q. Is actual sale needed to constitute use? A. No. The Joint Recommendation states that the following are sufficient: (a) circumstances indicating that the user of the sign is doing, or (b) has undertaken significant plans to do, business in the Member State in relation to goods or services which are identical or similar to those for which the sign is used on the Internet. Q. Japanese company is selling products in the Internet using Japanese language. Is this commercial use? A. No. Q. If a company has no means of delivering the products to a particular country, is this an important factor to consider? A. Yes. Q. Post sales services, where should this be done? A. The place where the item is sold. Q. Does the place where the sale is perfected determine where the commercial use of the trademark is undertaken? (Just a note: General Rule: Art. 1523, Civil code: Where in pursuance of a contract of sale, the seller is authorized to send the goods to the buyer, delivery of the goods to a carrier is deemed to be delivery of the goods to the buyer. Exception: When otherwise specified, e.g., the Incoterms, i.e., FOB Manila (title transfers in Manila) A. No. There is commercial use when the user of the mark is actually serving customers located in the Member State or has entered into other commercially motivated relationships with persons located in the Member State.

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DOMAIN NAMES Q. What are the parts of a domain name? A. Everything that precedes the dot is second level domain first level domain.

yahoo[.]com

Everything that comes after the dot is

Q. What are the dual functions of a domain name? A. The functions are: 1. Represents the address of a computer on the Internet so that every computer can communicate with every other computer. 2. Serves the same function in electronic commerce as the trademark in more traditional modes of business. Q. How do you obtain a domain name? A. Through an Internet Service Provider that submits the electronic application to 240 registries worldwide. Among these are NSI – Network Solutions Inc. Q. What is the system of registry? A. Domain names are assigned on a first come first serve basis. Thre is no requirement of use of the domain name in connection with an Internet-related service. While this may seem to aid cyberpiracy, this aids in defensive registry to prevent cyber-piracy. Q. What is the manner by which disputes on domain names are resolved? A. The owner of a trademark registration can challenge the domain name holder’s registration of an “identical” second-level domain provided the “effective date” of the complainant’s trademark registration predates the “creation date” of the domain name registration. Q. What is the procedure? A. It is as follows: 1. NSI will send a letter to the domain name registrant giving him 30 days to supply his own trademark registration. 2.

If the domain name registrant’s TM registration predates the notice of dispute, he will be able to keep his domain name. The trademark owner’s recourse would be to file a lawsuit or to have a settlement or arbitration.

3.

If the domain name registrant cannot produce its own TM registration: a. registrant can transfer domain name to TM owner b. registrant can register new TM which places the disputed name “on hold” c. registrant canr efuse to transfer, dispute name is “on hold” d. registrant can file for declaratory judgment

Q. What are the requirements to invoke the NSI dispute resolution? A. TM owner must have TM registration, the dispute is for an identical second level registry, on the federal principal register, application filing date predates the creation date of the domain name. Q. Is the dispute resolution viable? A. Not if the TM owner wishes to use the domain name because the domain name will be put on hold indefinitely. Q. What is the new method for domain name dispute resolution? A. The Uniform Dispute Resolution Policy (UDRP) which applies to any domain name confusingly similar to the complainant’s trademark, not simply an identical one. Q. What is the complainant’s burden of proof? A. They are three

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1. 2. 3.

The registrant’s domain name is identical or confusingly similar to a trademark or service mark of the complainant; The registrant has no rights or legitimate interest in the domain name; The domain name has been registered and used in bad faith.

Q. What are some indicators of bad faith? A. (1) Respondent’s offer to sell the domain name (2) no use of the domain name (3) attempt to show affiliation or trade off the goodwill of the complainant (4) failure to file a response (5) pattern of registering domain name consisting of marks belonging to others who are not affiliated with respondent (6) suspect timing in that respondent was aware of complainant’s prior rights Q. Please give a short summary of the proceedings. A. Certainly. 1. A complaint is filed in hard copy and via e-mail – this should request transfer of domain name and not cancellation; a provider (such as WIPO) is selected, and the panelists must be selected. 2. A response is filed 20 days from commencement date in hard copy and e-mail. Q. Are precedents respected? A. Some UDRP decisions have cited other decisions as precedent but there are many inconsisted decisions.

Yahoo! Inc. v. Net Games, Inc. Yahoo owns the trademarks YAHOO! and YAHOO!; services include both local and international web directory and search services, online games, people searches. Net Games uses the domain name yahoops.com for a gambling website that offers gambling on a variety of sports, including basketball, hockey, tennis, and boxing. Yahoo filed a ceaseand-desist letter but Net Games claims that it uses the name with a bona fide offering of goods, has used the name for many months without objection and it does not promote search engines nor cause actual confusion. Held: Based on the 3 factor test, (1) confusion - a reader is likely to believe that the subject domain name is related to the comlainant and its mark.; (2) legitimate right – it is a reasonable inference that the subject domain name was created with YAHOO!’s mark in mind. Net Games has spent little time and money to develop the site, and it cannot be said to have legitimate interest in the domain name; (3) bad faith – but there is no bad faith. The only proof alleged is that Net Games is benefiting from the notoriety of its mark. This is not enough. Philips v. Park Kyoung Seok Philips (Netherlands) owns the TM Philips. Park acquired “philips.com.ph” and registered it with dotPHone, Inc. in RP. There are no active websites for them but are currently pointed to name servers.When Philips sent it a cease and desist letter, it replied that it is not willing to sell the domain names yet, but would like to know exactly about the condition and proposition of those who are interested in these domain names. Park argues that it used “Philips” because it is an acronym for Philippine Information Providing Service. Held: (1) confusion – the names are identical; (2) legitimate rights – Park has no legitimate right over the TM Philips. It is not supported by any evidence of use, and reference to the Oxford Dictionary does not disclose such accepted abbreviation. (3) bad faith – the

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response to the letter suggests that it was part of Park’s intention to sell the domain name at some time for valuable consideration. The court also observed a pattern of registering famous marks in RP. There is no evidence that Park has ever had a business which attempted to use the domain names.

Yahoo! v. Yahoo Computer Services Yahoo! (Delaware) is a search engine and Yahoo Computer Services (RP) is a business in Makati which registered “yahoo.com.ph” and “yahoo.ph.” Yahoo! Claims that it is the owner of the mark and the use of YCS is infringing. YCS claims that its main income is from the sale of services and sale of hardware and software. Its income has risen only 1.7% since the domain name was acquired and it is only a small company which has had 1,004 hits on its site. Held: YCS has no legitimate right of interest in the domain name. Its alleged rights are based on a certificate of registration of business name. But there is no evidence that registration of a business name with the DTI of RP provides the registrant with any exclusive rights with respect to the business name. It did not provide YCS with an exclusive right to use of the domain name. There is also clear bad faith since it is inconceivable that YCS could have been unaware of the complainant’s name and TM when it registered. Philips v. Relson Philips Electronics (Netherlands) filed a complaint against Relson Ltd. of Western Samoa which registered “philips.ws”. Relson did not reply to the complaint. Held: The fact that Relson failed to provide a response to the complaint does not relieve the complainant Philips of the burden of proving its case. Though Relson did not expressly challenge any of the assertions, this cannot simply be taken as an admission. (1) identity There is indeed identity of the names. (2) legitimate rights – not proven. Its allegations say that it has no right to the domain name are no more than the factors given in the Policy. Mere assertion is not proof. (3) Bad faith – there is no challenge to the complaint. But there ought not to be any inferences from default other than those that have been established or can be fairly inferred from the facts in the complaint. There is also no evidence that there is intention to sell, nor a plan to sell the domain name.

America Online v. Frank Albanese America Online uses “aol.com”. Frank registered “aoltrader.com”. AOL filed a complaint saying that there is use in bad faith, since Frank registered the domain name after AOL’s adoption of the mark, that they are nearly identical, that Frank has registered numerous other domain names that infringe upon famous marks including “inteltrader.com,” “ciscotrader.com,” “ibmtrader.com,” etc. Held: AOL has not met all the requirements. No question that it is confusingly similar. However, Frank has rights or legitimate interests to the domain name, since he has used the domain name with a bona fide offering of services, that is, online stock brokerage services. There is fair use of the disputed domain name and the use of Frank is merely descriptive of the services offered by Frank. There is also a disclaimer on the website of any affiliation with AOL which supports the finding of good faith.

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Yahoo! v. Syrynx, Inc. April ’99, Yahoo officially anounced its acquisition of “broadcast.com”, an internet co. that specializes in aggregation and broadcast of streaming audio via the internet. But as early as March ’99, there had been industry speculation on such merger. The day before Syrynx registered the domain name “yahoobroadcast.com” and “yahoolinux.com” (Mar ’99), Wall Street Journal reported that Yahoo! Was in talks to acquire Broadcast.com. Yahoo filed a complaint but Syrynx claims that it spent $100-$125K to get the site going although the site actually connects to an index page displaying a deadline. Syrynx filed no response. Held: (1) identical – established; (2) legitimate use – respondent has to prove use or preparation to use; that he has been commonly known by the disputed domain name, and that he is making a legitimate noncommercial or fair use of the name with no intent for commercial gain. Here, Syrynx is in default and he has failed to prove the factors; (3) the name is also registered in bad faith, because it has registered multiple domain names all identical to names belonging to Yahoo. Arthur Guinness v. Dejan Macesic Arthur Guiness (Ireline) owns the TM “Guinness” for beer. Dejan registered the domain name “guiness.com” for a website dedicated to the discussion of home brewing and sports. Held: (1) identity – Dejan is not infringing on Arthur’s mark as he is not selling similar wares or services. Guinness has other products like the Guinness World Book of Records, Guinness Flight, Guinness Group. The word “guinness” is not automatically associated with “guinness beer”. There is also a legitimate noncommercial, fair use of the domain name with no intent for commercial gain. Revenues are modest and serve to cover hosting and maintenance costs. Also, there is no bad faith since every effort has been made to eliminate the likelihood of any possible mistaken association of the site with the beer. Q. What are the factors showing bad faith? A. The factors are: (i) circumstances that indicate that the Respondent has registered or has acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the Complainant who is the owner of the trademark or service mark or to a competitor of the Complainant, for valuable consideration in excess of the Respondent’s documented out-of-pocket costs directly related to the domain name; (ii) registration of the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that the Respondent has engaged in a pattern of such conduct; (iii) registration of the domain name primarily for the purpose of disrupting the business of a competitor; (iv) by using the domain name, intentionally attempting to attract, for commercial gain, Internet users to the Respondent’s web site or other on-line location, by creating a likelihood of confusion with the complainant's mark as to the source, sponsorship, affiliation, or endorsement of the web site or location or of a product or service on it or a location. Q. Is the UDRP available to RP companies for violation of domain names? A. Yes, since jurisdiction is acquired by UDRP when parties submit to its jurisdiction. Q. A UK company registeres “jollibee.uk”, can Jollibee file a case against it in RP RTC’s? A. No. RP court can’t acquire jurisdiction over that foreign firm, the cause of action of Jollibee would not be on RP law, and this case differs from traditional TM infringement cases in many aspects.

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ABUSE

OF

WEB TECHNOLOGIES

Q. What are the issues in linking? A. Linking is vital to the seamless functioning of the web, because it reduces the need to use complex address and provides nearly instantaneous access to other sites of interest. Linking increases “hits” which increases advertising revenues. But the problem primarily is that one loses track of exactly whose website one is on, where the information is coming from, and how current it is. Q. What are the dangers of framing? A. In framing, a user reads content from one site in another’s site. In the Total News case, plaintiff objected not to linking per se but only to partial linking, where their advertising has been edited or deleted and the defendants have substituted their own advertising. Implied license to link did not permit any right to alter. Q. Summarize the dangers of framing. A. They are: (1) Loss of advertising revenue, and (2) Confusion over the ownership of a site Q. What is a metatag? A. It is a software parameter of HTML, where a website creator can describe what is available in that particular site, and search engines rely on that to match a website to a search query. Q. What is cyberstuffing? A. It is the placing of multiple entries of a keyword on the face of a webpage. It can be invisible on the face of a webpage (black lettering against black background) or from repeated use of a word (e.g. This site is not related to X, is not endorsed by X, we don’t use X, X, sorry if you see this, X, we love you.) Q. What is the problem brought about by metatagging and cyberstuffing? A. Internet advertising erevenues are driven by the number of hits or times a certainw ebsite is accessed. The purpose of both is to lure persons searching the third-party trademark to an unrelated website. Q. Cause of action in metatagging and cyberstuffing? A. Unfair competition. Q. What is an aggregation site? A. A site that essentially serves as a specialized search engine. An auction aggregation site will serve to search multiple auction sites by use of automated software programs. Q. Cause of action. A. In one case, eBay filed for trespass, false advertising, trademark dilution, computer fraud and abuse, unfair competition, unjust enrichment. The court granted it an injunction since it was found that the aggregation site’s actions was unauthorized and the proximate cause of injury suffered by eBay due to loss of bandwidth or server capacity. Q. What is mousetrapping? A. Here, when one views a webpage, he is unable to go back to any of the previous pages visited and is trapped at the last site viewed. Q. What are webrings? A. Webrings are a web within a web, where owners of websites with a common theme band together to arrange sites into linked circles. For examples, there can be a Star Trek webring, etc. Q. What are possible violations in webrings? A. There could be violation on how the trademarks are used.

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Q. Will an action in RP against “sucks” sites prosper? E.g., jollibeesucks.com, ateneosucks.com. A. Possible causes of action would be violation of abuse of right provisions under Art. 19, 20, 21 of the Civil Code, and that the freedom of speech does not extend to that. Q. US firm distributing porn over the net. How can RP stop pornographers over the internet? A. Maybe through ISP’s, under the E-Commerce Act.

EXEUNT

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NO GUARANTY OF ACCURACY. IT’S VERY DIFFICULT TO TAKE NOTES WHEN ONE IS SLEEPY. ☺

PART II THE LAW ON PATENTS

Q. What are Intellectual Property Rights? A. The law does not define IPR. However, Sec. 4 of the IP Code states: that the term "intellectual property rights" consists of: [a] Copyright and Related Rights; [b] Trademarks and Service Marks; [c] Geographic Indications; [d] Industrial Designs; [e] Patents; [f] Layout-Designs (Topographies) of Integrated Circuits; and [g] Protection of Undisclosed Information Q. How do you differentiate copyright and patent? A. Copyright – Idea is not protected, but EXPRESSION is protected Patent – Idea is also not protected, but APPLICATION is protected. Q. What is the government agency that implements patent law? A. the IPO, particularly, the Bureau of Patents. This is part of the Office of the President. Q. Why does patent exist? A. It exists both for the protection of the inventor and society. Protection is granted for 20 years and not extendable unlike trademarks. The responsibility of the inventor is to disclose in as much detail as possible, his invention. Q. What are the rights granted under international agreements (Paris Convention)? A. Basically: 1. National Treatment Principle 2. Priority Rights – an application filed in applicant’s home country, when filed in another treaty country within 6 months, retroacts to the earlier filing date note that this benefits mostly the big companies. under patents, the period is one year under PCT (Paris Convention?) – period was extended to 30 months 3. Independence of Patents – if an application is rejected in a second country, it does not affect the validity of patents granted in the first country (e.g., RP). Q. What treaty do you refer to? A. The TRIPS Agreement. The WTO is the main agreement. Its main objective is to liberalize trade and remove trade barriers. Q. What did Atty. Sapalo say about civil ex parte search and seizure? A. As a rule, the court frowns upon the grant of ex parte seizures. But if you don’t, then you will notify the infringer before you attack, and if you do, they will disappear. Q. Can you file oppositions in patent applications, like in trademarks? A. No opposition, because it would be too cumbersome and it would delay the granting of the patent. The public can only submit comments. But after the grant of the patent, then that is the time when you file the cancellation case.

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CHAPTER I GENERAL PROVISIONS SEC. 20. DEFINITION OF TERMS USED IN PART II, THE LAW ON PATENTS. -- AS USED IN PART II, SHALL HAVE THE FOLLOWING MEANINGS: 20.1. BUREAU MEANS THE BUREAU OF PATENTS;

THE FOLLOWING TERMS

20.2. DIRECTOR MEANS THE DIRECTOR OF PATENTS; 20.3. REGULATIONS MEANS THE RULES OF PRACTICE PATENTS AND PROMULGATED BY THE DIRECTOR GENERAL;

IN

PATENT CASES

FORMULATED BY THE

DIRECTOR

OF

20.4. EXAMINER MEANS THE PATENT EXAMINER; 20.5. PATENT APPLICATION OR APPLICATION MEANS AN APPLICATION FOR A PATENT FOR AN INVENTION EXCEPT IN CHAPTERS XII AND XIII, WHERE APPLICATION MEANS AN APPLICATION FOR A UTILITY MODEL AND AN INDUSTRIAL DESIGN, RESPECTIVELY; AND 20.6. PRIORITY

DATE MEANS THE DATE OF FILING OF THE FOREIGN APPLICATION FOR THE SAME INVENTION

REFERRED TO IN SECTION 31 OF THIS ACT. (N)

Q. What is the law that precedes the IP Code? A. RA 165. Q. What law governs the applications which were pending when the IP Code was passed? A. It is the old law that governs. Q. Differentiate the old law from the new law. A. See chart.

Coverage

RA 165 Limited to patents

Term Definition of what is patentable Different in procedure Examination required?

17 years from date of grant Different from Sec. 21 of IP Code First to invent Examination is not required, grant is based on the merits

When publication is required

Only patents granted

Does compulsory licensing exist?

Yes, and it covers broad grounds for food and medicine

that

have

been

IP Code Covers copyrights, patents, trademarks, undisclosed information, utility models, and industrial designs 20 years from date of filing Sec. 21 First to file All applications are subject to substantive examination, to check if there is the condition of novelty and prior art Publication is required for the applications and the patents which are granted Yes, but not merely for food and medicine

Q. RA 175 (17 years from grant), IP Code (20 years from filing). Which grants longer protection?

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A. It depends. But usually, it is the old law, because it takes about 5 years for the patent office to examine and process your invention. Q. Which is the better system, first to file or first to invent? A. First to invent seems to be more just. But there was a shift in order to penalize the inventor who refuses to disclose his invention. Also, it is easier to administer, since to check who filed first, you just check the records. In first to invent system, it becomes a long and expensive process. Q. What is the system in the US? A. Due to strong lobby from pharmaceutical companies, US is still maintaining a first to invent system. Q. Why is publication important? A. It is important for early dissemination of information and technology. Application is published also to check if there are prior filed applications. CHAPTER II PATENTABILITY SEC. 21. PATENTABLE INVENTIONS. - ANY TECHNICAL SOLUTION OF A PROBLEM IN ANY FIELD OF HUMAN ACTIVITY WHICH IS NEW, INVOLVES AN INVENTIVE STEP AND IS INDUSTRIALLY APPLICABLE SHALL BE PATENTABLE. IT MAY BE, OR MAY RELATE TO, A PRODUCT, OR PROCESS, OR AN IMPROVEMENT OF ANY OF THE FOREGOING. Q. What are the conditions of patentability? A. As enumerated in Sec. 21, they are: 1) novelty 2) involves an inventive step 3) is industrially applicable. SEC. 22. NON-PATENTABLE INVENTIONS. - THE FOLLOWING SHALL BE EXCLUDED FROM PATENT PROTECTION: 22.1. DISCOVERIES, SCIENTIFIC THEORIES AND MATHEMATICAL METHODS; 22.2. SCHEMES,

RULES AND METHODS OF PERFORMING MENTAL ACTS, PLAYING GAMES OR DOING BUSINESS, AND

PROGRAMS FOR COMPUTERS;

22.3 METHODS

FOR TREATMENT OF THE HUMAN OR ANIMAL BODY BY SURGERY OR THERAPY AND DIAGNOSTIC

METHODS PRACTICED ON THE HUMAN OR ANIMAL BODY.

THIS

PROVISION SHALL NOT APPLY TO PRODUCTS AND

COMPOSITION FOR USE IN ANY OF THESE METHODS;

22.4. PLANT

VARIETIES OR ANIMAL BREEDS OR ESSENTIALLY BIOLOGICAL PROCESS FOR THE PRODUCTION OF

PLANTS OR 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. Diamond v. Chakrabarty Chakrabarty applied for the patent of a bacterium capable of breaking down components of crude oil for the process of producing the bacteria, the inoculum and

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for the bacteria itself. Patent for the bacteria was rejected by the Director claiming that micro-organisms are products of nature and as living things, they are not patentable subject matter. The patent was sought under Sec. 101 which says: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore. The Director denied this also on the ground that in a previous ruling in Funk, the root-nodule bacteria was considered not patentable by the Court. Held: Bacteria falls under the “manufacture” as provided in Sec. 101, or the production of articles for use from raw or prepared materials, giving them new forms, qualities, properties or combinations. Congress plainly contemplated that patent laws should be given wide contemplation. Although patent does not cover everything (laws of nature, physical phenomenon, and abstract ideas are not patentable), the bacteria is patentable because it is a hitherto unknown natural phenomenon, not naturally occuring and is a product of human ingenuity. Funk is not controlling because there, the patentee discovered only some of the handiwork of nature and there was no new bacteria, no change in the six specie of the bacteria. Here, a new bacterium with markedly different characteristics in nature is produced. Q. According to the ruling, what is patentable? A. “Anything under the sun that is made by man” is potentially patentable. Q. Are life-forms patentable? A. As a first step, always check provisions on patentability of subject matter. Since the subject matter should be a technical solution, as a rule, it is patentable. Q. Is the ruling in Chakrabarty automatically applicable in RP? A. It should be qualified because Sec. 101 has no words “technical solution.” Q. What are the exceptions to the rule that life forms are patentable? A. Sec. 22.4 – plant varieties and animal breeds. Note: There is a plant variety law which now gives protection to plant varieties. Nota Bene: There is no rule that only inanimate objects can be protected. Q. What is the exception to the exception that plant varieties and animal breeds are not patentable? A. When the Legislature grants sui generis protection. Gottschalk v. Benson Benson filed for a patent application for the processing of data, a method for converting binary-coded decimal numerals into pure binary numerals. They purport to cover any use of the claimed method in a general purpose digital computer of any type. Held: A procedure for solving a given type of mathematical problem is known as an algorithm. The mathematical formula involved here has no substantial practical application except in connection with a digital computer, which means that if the patent is grant, it would wholly pre-empt the mathematical formula and would be a

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patent on the algorithm itself. Patents must be tied to a particular machine or must operate to change articles into a different state of things. Ideas may not be patented and to patent the method here would have the effect of patenting an idea.

Parker v. Flook A patent was applied for by Flook on a method of updating alarm limits, the only novel feature of which is a mathematical formula. Under the method sought to be patented, the an operator can calculate an updated alarm limit once he knows the original alarm base. The application was rejected on the finding that the only difference between the claim and the prior art would be a patent on the formula or mathematics itself. But it was reversed saying it was only claiming on the use of the method to update alarm limits in a process. Flook claims that there is a post-solution activity here which distinguishes this case from Benson. Held: The notion that post-solution activity, no matter how conventional or obvious, can transform an unpatentable principle into patentable exalts form over substance because then a competent draftsman could attach some sort of post-solution activity to almost any mathematical formula. The process itself, not merely the mathematical formula, must be new and useful.

Diamond v. Diehr Invention sought to be patented is a process for molding raw, uncured, synthetic rubber into cured precision products. The process uses a mold for precisely shaping the material under head so that the product would retain its shape. Before, despite the use of the Arrhenius equation, the industry had not been able to obtain uniformly accurate cures because the temperature of the molding press could not be precisely measured. The invention solves this problem y constantly measuring the acute temperature inside the mold. The measurements were automatically fed into a computer which repeatedly recalculated the cured time. Application was rejected claiming that what was sought to be patented was conventional and necessary to the process and cannot be patentable. Held: It is true that an idea like a mathematical formula cannot be patented. But this is not a formula but a process of curing synthetic rubber. They do not seek to pre-empt the use of a mathematical equation, only to foreclose from others the use of that equation in conjunction with all other steps in the process. The Arrhenius equation is not patentable in isolation but here, a process for curing rubber is devised which incorporates in it a more efficient solution so that process is not barred. Q. Are computer software patentable? A. No, since expressly excluded. Q. Is there a means of acquiring protection? A. If it is the program itself or the mathematical algorithm itself, it is not patentable. However, if there is a specific application like in Diehr, then it may be patentable. In other words, the concept itself is not patentable. It should pertain to a specific process.

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State Street v. Signature Financial Group State Street brought a declaratory judgment action claiming the patent granted to Signature Financial was not enforceable. The patent concerns a data processing system for implementing an investment structure which was developed for use in Signature’s business. This is identified as Hub & Spoke where the mutual funds pool their assets in an investment portfolio organized as a partnership. Held: The invention is patentable as a process. This is because the machine for managing the financial services configuration, which is used as a data-processing system, is patentable. The transformation of data by a machine through a series of mathematical calculations constitute a practical application of a mathematical algorithm because it produces a useful, concrete and tangible result, a final share price momentarily fixed for recording and reporting and even accepted and relied upon by authorities and circles in the trade. Q. Is a business method patentable in the Philippines? A. See State Street and compare US law with our own law. Many say that State Street does not apply to business methods. In Europe, “Industry” is something technical. SEC. 23. NOVELTY. - AN INVENTION SHALL NOT BE CONSIDERED NEW IF IT FORMS PART OF A PRIOR ART. Q. What is the difference between RA 165 and the IP Code regarding novelty? A. The IP Code introduces the concepts of priority and filing date. Q. You have 100 factory workers, to whom you disclose your patent before you apply for a patent. Does this cause loss of novelty? A. The question is whether you can control the 100 workers. But there is still no case law in RP. Q. An application is filed in RP but rejected because of lack of novelty from publication of the same technology in Kazakhstan before the filing date. Is this correct? A. Yes. In RA 165, there was a provision on domestic novelty as to utility models. However, under the law now, wherever the technology is publish, it will form part of prior art. Q. A invents a pencil, B invents an eraser, you stick the eraser into the pencil. Patentable? A. No. According to Nissin v. Inoue, where two or more prior art are combined, the test is whether the prior art suggests doing what the applicant did. A combination patent will not be sustained when the properties inherently possessed by several elements combined remain unchanged and no unusual or surprising consequence results from the combination. 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 PROVIDED,

FILING OR PRIORITY DATE THAT IS EARLIER THAN THE FILING OR PRIORITY DATE OF THE APPLICATION:

THAT THE APPLICATION WHICH HAS VALIDLY SECTION 31 OF THIS ACT, SHALL BE PRIOR

CLAIMED THE FILING DATE OF AN EARLIER APPLICATION UNDER ART WITH EFFECT AS OF THE FILING DATE OF SUCH EARLIER

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APPLICATION:

PROVIDED

FURTHER,

THAT

THE APPLICANT OR THE INVENTOR IDENTIFIED IN BOTH APPLICATIONS

ARE NOT ONE AND THE SAME.

SEC. 25. NON-PREJUDICIAL DISCLOSURE. 25.1. THE DISCLOSURE OF INFORMATION

CONTAINED IN THE APPLICATION DURING THE TWELVE

(12)

MONTHS

PRECEDING THE FILING DATE OR THE PRIORITY DATE OF THE APPLICATION SHALL NOT PREJUDICE THE APPLICANT ON THE GROUND OF LACK OF NOVELTY IF SUCH DISCLOSURE WAS MADE BY:

(A) THE INVENTOR; (B ) A

PATENT OFFICE AND THE INFORMATION WAS CONTAINED (A) IN ANOTHER APPLICATION FILED BY

THE INVENTOR AND SHOULD NOT HAVE BEEN DISCLOSED BY THE OFFICE, OR (B) IN AN APPLICATION FILED WITHOUT THE KNOWLEDGE OR CONSENT OF THE INVENTOR BY A THIRD PARTY WHICH OBTAINED THE INFORMATION DIRECTLY OR INDIRECTLY FROM THE INVENTOR; OR

(C) A

THIRD PARTY WHICH OBTAINED THE INFORMATION DIRECTLY OR INDIRECTLY FROM THE INVENTOR.

25.2. FOR THE PURPOSES OF SUBSECTION 25.1, "INVENTOR"

ALSO MEANS ANY PERSON WHO, AT THE FILING DATE

OF APPLICATION, HAD THE RIGHT TO THE PATENT. (N)

Q. What are the means of disclosing a technical solution, such that it becomes part of prior art? A. They are: 1. describing the technical solution in writing, which must be published; 2. describing the technical solution in spoken word, which must be uttered to the public; 3. use of the technical solution in public or putting the public in a position that any member may use it 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)

Q. How do you determine if there is inventive step? A. You should always check the state of the art. Q. Who is a “person skilled in the art?” A. This is a question of fact. SEC. 27. INDUSTRIAL APPLICABILITY. - AN INDUSTRIALLY APPLICABLE. (N)

INVENTION THAT CAN BE PRODUCED AND USED IN ANY INDUSTRY SHALL BE

CHAPTER III RIGHT TO A PATENT SEC. 28. RIGHT TO A PATENT. - THE RIGHT TO A PATENT BELONGS TO THE INVENTOR, HIS HEIRS, OR ASSIGNS. WHEN TWO (2) OR MORE PERSONS HAVE JOINTLY MADE AN INVENTION, THE RIGHT TO A PATENT SHALL BELONG TO THEM JOINTLY. SEC. 29. FIRST TO FILE RULE. - IF

TWO

(2)

OR MORE PERSONS HAVE MADE THE INVENTION SEPARATELY AND

INDEPENDENTLY OF EACH OTHER, THE RIGHT TO THE PATENT SHALL BELONG TO THE PERSON WHO FILED AN APPLICATION FOR SUCH INVENTION, OR WHERE TWO OR MORE APPLICATIONS ARE FILED FOR THE SAME INVENTION, TO THE APPLICANT WHO HAS THE EARLIEST FILING DATE OR, THE EARLIEST PRIORITY DATE.

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SEC. 30. INVENTIONS CREATED PURSUANT TO A COMMISSION. 30.1. THE

PERSON WHO COMMISSIONS THE WORK SHALL OWN THE PATENT, UNLESS OTHERWISE

PROVIDED IN THE CONTRACT.

30.2. 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 INVENTION IS THE RESULT OF THE PERFORMANCE OF HIS REGULARLY-

ASSIGNED DUTIES, UNLESS THERE IS AN AGREEMENT, EXPRESS OR IMPLIED, TO THE CONTRARY.

(N) SEC. 31. RIGHT OF PRIORITY. - AN APPLICATION FOR PATENT FILED BY ANY PERSON WHO HAS PREVIOUSLY APPLIED FOR THE

SAME INVENTION IN ANOTHER COUNTRY WHICH BY TREATY, CONVENTION, OR LAW AFFORDS SIMILAR PRIVILEGES TO

FILIPINO CITIZENS, SHALL BE CONSIDERED AS FILED AS OF THE DATE OF FILING THE FOREIGN APPLICATION: PROVIDED, THAT: (A) THE LOCAL APPLICATION EXPRESSLY CLAIMS PRIORITY; (B) IT IS FILED WITHIN TWELVE (12) MONTHS FROM THE DATE THE EARLIEST FOREIGN APPLICATION WAS FILED; AND (C) A CERTIFIED COPY OF THE FOREIGN APPLICATION TOGETHER WITH AN ENGLISH TRANSLATION IS FILED WITHIN SIX (6) MONTHS FROM THE DATE OF FILING IN THE PHILIPPINES. Q. X filed a patent in the US on April 1, 2002. When should X file in the Philippines to obtain the priority date? A. He should file by April 1, 2003, as provided in Sec. 31. Invention A Invention B Invention C

Filing date: Jan 02, 00 Filing date: Jan 15, 00 Filing date: Dec. 15, 99

Published: Jan 15, 01 Published: Feb 01, 01 Published: Feb. 13, 01

Q. Is A & B prior art to C since C was published last? A. No. What is important is the filing date and not date of publication. Q. Employee steals the technology of employer and both the employee and the employer file a patent for the invention. A. Should be the employer, since employee did not invent separately and independently from the employee. First to file system applies only when two individuals created separately and independently then an application was filed by both.

CHAPTER IV PATENT APPLICATION

SEC. 32. THE APPLICATION. 32.1. THE PATENT APPLICATION SHALL BE IN FILIPINO OR ENGLISH AND SHALL CONTAIN THE FOLLOWING: (A) A REQUEST FOR THE GRANT OF A PATENT; (B ) A

DESCRIPTION OF THE INVENTION;

(C) DRAWINGS NECESSARY FOR THE UNDERSTANDING OF THE INVENTION; (D) ONE OR MORE CLAIMS; AND

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(E) AN ABSTRACT. 32.2. NO

PATENT MAY BE GRANTED UNLESS THE APPLICATION IDENTIFIES THE INVENTOR.

NOT THE INVENTOR, THE

IF

THE APPLICANT IS

OFFICE MAY REQUIRE HIM TO SUBMIT SAID AUTHORITY.

SEC. 33. APPOINTMENT OF AGENT OR REPRESENTATIVE. - AN

APPLICANT WHO IS NOT A RESIDENT OF THE

MUST APPOINT AND MAINTAIN A RESIDENT AGENT OR REPRESENTATIVE IN THE

PHILIPPINES

PHILIPPINES

UPON WHOM NOTICE OR

PROCESS FOR JUDICIAL OR ADMINISTRATIVE PROCEDURE RELATING TO THE APPLICATION FOR PATENT OR THE PATENT MAY BE SERVED.

(SEC. 11, R. A. NO. 165A) SEC. 34. THE REQUEST. - THE REQUEST SHALL CONTAIN A PETITION FOR THE GRANT OF THE PATENT, THE NAME AND OTHER DATA OF THE APPLICANT, THE INVENTOR AND THE AGENT AND THE TITLE OF THE INVENTION. (N) SEC. 35. DISCLOSURE AND DESCRIPTION OF THE INVENTION. 35.1. DISCLOSURE. - THE APPLICATION SHALL DISCLOSE THE INVENTION IN A MANNER SUFFICIENTLY CLEAR AND COMPLETE FOR IT TO BE CARRIED OUT BY A PERSON SKILLED IN THE ART. WHERE THE APPLICATION CONCERNS A MICROBIOLOGICAL PROCESS OR THE PRODUCT THEREOF AND INVOLVES THE USE OF A MICRO-ORGANISM WHICH CANNOT BE SUFFICIENTLY DISCLOSED IN THE APPLICATION IN SUCH A WAY AS TO ENABLE THE INVENTION TO BE CARRIED OUT BY A PERSON SKILLED IN THE ART, AND SUCH MATERIAL IS NOT AVAILABLE TO THE PUBLIC, THE APPLICATION SHALL BE SUPPLEMENTED BY A DEPOSIT OF SUCH MATERIAL WITH AN INTERNATIONAL DEPOSITORY INSTITUTION.

35.2. DESCRIPTION. - THE REGULATIONS OF PRESENTATION.

SHALL PRESCRIBE THE CONTENTS OF THE DESCRIPTION AND THE ORDER

SEC. 36. THE CLAIMS. 36.1. THE APPLICATION SHALL CONTAIN ONE (1) PROTECTION IS SOUGHT. EACH CLAIM SHALL DESCRIPTION.

OR MORE CLAIMS WHICH SHALL DEFINE THE MATTER FOR WHICH BE CLEAR AND CONCISE, AND SHALL BE SUPPORTED BY THE

36.2. THE REGULATIONS SHALL PRESCRIBE THE MANNER OF THE PRESENTATION OF CLAIMS. (N) SEC. 37. THE ABSTRACT. - THE ABSTRACT SHALL CONSIST OF A CONCISE SUMMARY OF THE DISCLOSURE OF THE INVENTION (150) WORDS. IT MUST BE DRAFTED IN A WAY WHICH ALLOWS THE CLEAR UNDERSTANDING OF THE TECHNICAL PROBLEM, THE GIST OF THE SOLUTION OF THAT PROBLEM THROUGH THE INVENTION, AND THE PRINCIPAL USE OR USES OF THE INVENTION. THE ABSTRACT SHALL MERELY SERVE FOR TECHNICAL INFORMATION. (N) SEC. 38. UNITY OF INVENTION. AS CONTAINED IN THE DESCRIPTION, CLAIMS AND DRAWINGS IN PREFERABLY NOT MORE THAN ONE HUNDRED FIFTY

38.1. THE

APPLICATION SHALL RELATE TO ONE INVENTION ONLY OR TO A GROUP OF INVENTIONS FORMING A

SINGLE GENERAL INVENTIVE CONCEPT.

38.2. IF

SEVERAL INDEPENDENT INVENTIONS WHICH DO NOT FORM A SINGLE GENERAL INVENTIVE CONCEPT ARE

CLAIMED IN ONE APPLICATION, THE INVENTION.

A

DIRECTOR MAY REQUIRE THAT THE APPLICATION BE RESTRICTED TO A SINGLE

LATER APPLICATION FILED FOR AN INVENTION DIVIDED OUT SHALL BE CONSIDERED AS HAVING BEEN

FILED ON THE SAME DAY AS THE FIRST APPLICATION: FOUR

(4)

PROVIDED, THAT THE LATER APPLICATION IS FILED WITHIN

MONTHS AFTER THE REQUIREMENT TO DIVIDE BECOMES FINAL, OR WITHIN SUCH ADDITIONAL TIME, NOT

EXCEEDING FOUR

(4)

MONTHS, AS MAY BE GRANTED:

PROVIDED

FURTHER,

SHALL NOT GO BEYOND THE DISCLOSURE IN THE INITIAL APPLICATION.

THAT

EACH DIVISIONAL APPLICATION

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38.3. THE

FACT THAT A PATENT HAS BEEN GRANTED ON AN APPLICATION THAT DID NOT COMPLY WITH THE

REQUIREMENT OF UNITY OF INVENTION SHALL NOT BE A GROUND TO CANCEL THE PATENT.

(SEC. 17, R. A. NO.

165A) SEC. 39. INFORMATION CONCERNING CORRESPONDING FOREIGN APPLICATION FOR PATENTS. - THE APPLICANT SHALL, AT THE REQUEST OF THE DIRECTOR, FURNISH HIM WITH THE DATE AND NUMBER OF ANY APPLICATION FOR A PATENT FILED BY HIM ABROAD, HEREAFTER REFERRED TO AS THE "FOREIGN APPLICATION," RELATING TO THE SAME OR ESSENTIALLY THE SAME INVENTION AS THAT CLAIMED IN THE APPLICATION FILED WITH THE OFFICE AND OTHER DOCUMENTS RELATING TO THE FOREIGN APPLICATION. (N) CHAPTER V PROCEDURE FOR GRANT OF PATENT SEC. 40. FILING DATE REQUIREMENTS. 40.1. THE FILING DATE OF A PATENT APPLICATION SHALL BE THE DATE OF RECEIPT BY THE OFFICE OF AT LEAST THE FOLLOWING ELEMENTS: (A) AN EXPRESS OR IMPLICIT INDICATION THAT A PHILIPPINE PATENT IS SOUGHT; (B) INFORMATION IDENTIFYING THE APPLICANT;

AND

(C) DESCRIPTION OF THE INVENTION AND ONE (1) 40.2. IF

OR MORE CLAIMS IN FILIPINO OR

ANY OF THESE ELEMENTS IS NOT SUBMITTED WITHIN THE PERIOD SET BY THE

ENGLISH. REGULATIONS,

THE

APPLICATION SHALL BE CONSIDERED WITHDRAWN. (N)

SEC. 41. ACCORDING A FILING DATE. - THE OFFICE

SHALL EXAMINE WHETHER THE PATENT APPLICATION SATISFIES THE

REQUIREMENTS FOR THE GRANT OF DATE OF FILING AS PROVIDED IN

SECTION 40

HEREOF.

IF THE DATE OF FILING CANNOT

BE ACCORDED, THE APPLICANT SHALL BE GIVEN AN OPPORTUNITY TO CORRECT THE DEFICIENCIES IN ACCORDANCE WITH THE IMPLEMENTING REGULATIONS.

IF THE APPLICATION DOES NOT CONTAIN ALL THE ELEMENTS INDICATED IN SECTION 40, THE IF THE DEFICIENCIES ARE NOT REMEDIED WITHIN THE PRESCRIBED TIME LIMIT, THE APPLICATION SHALL BE CONSIDERED WITHDRAWN. (N) FILING DATE SHOULD BE THAT DATE WHEN ALL THE ELEMENTS ARE RECEIVED.

SEC. 42. FORMALITY EXAMINATION. 42.1. AFTER THE PATENT APPLICATION

HAS BEEN ACCORDED A FILING DATE AND THE REQUIRED FEES HAVE BEEN

REGULATIONS, THE APPLICANT SHALL COMPLY WITH THE FORMAL REGULATIONS WITHIN THE PRESCRIBED PERIOD, OTHERWISE THE APPLICATION SHALL BE CONSIDERED WITHDRAWN.

PAID ON TIME IN ACCORDANCE WITH THE REQUIREMENTS SPECIFIED BY

42.2. THE REGULATIONS

SECTION 32

AND THE

SHALL DETERMINE THE PROCEDURE FOR THE RE-EXAMINATION AND REVIVAL OF AN

APPLICATION AS WELL AS THE APPEAL TO THE

DIRECTOR OF PATENTS FROM ANY FINAL ACTION BY THE EXAMINER.

(SEC. 16, R. A. NO. 165A) SEC. 43. CLASSIFICATION AND SEARCH. - AN APPLICATION THAT HAS COMPLIED WITH THE FORMAL REQUIREMENT SHALL BE

CLASSIFIED AND A SEARCH CONDUCTED TO DETERMINE THE PRIOR ART. (N)

SEC. 44. PUBLICATION OF PATENT APPLICATION. 44.1. THE PATENT APPLICATION SHALL BE PUBLISHED IN THE IPO GAZETTE TOGETHER WITH A SEARCH DOCUMENT ESTABLISHED BY OR ON BEHALF OF THE OFFICE CITING ANY DOCUMENTS THAT REFLECT PRIOR ART, AFTER THE EXPIRATION OF EIGHTEEN (18) MONTHS FROM THE FILING DATE OR PRIORITY DATE.

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44.2. AFTER

PUBLICATION OF A PATENT APPLICATION, ANY INTERESTED PARTY MAY INSPECT THE APPLICATION

DOCUMENTS FILED WITH THE OFFICE.

44.3. THE DIRECTOR GENERAL,

TRADE AND INDUSTRY, MAY PROHIBIT OR RESTRICT THE PUBLICATION OF AN APPLICATION, IF IN HIS OPINION, TO DO SO WOULD BE PREJUDICIAL TO THE NATIONAL SECURITY AND INTERESTS OF THE REPUBLIC OF THE PHILIPPINES. (N) SUBJECT TO THE APPROVAL OF THE

SECRETARY

OF

SEC. 45. CONFIDENTIALITY BEFORE PUBLICATION. - A PATENT APPLICATION, WHICH HAS NOT YET BEEN PUBLISHED, AND ALL RELATED DOCUMENTS, SHALL NOT BE MADE AVAILABLE FOR INSPECTION WITHOUT THE CONSENT OF THE APPLICANT. (N) SEC. 46. RIGHTS CONFERRED BY A PATENT APPLICATION AFTER PUBLICATION. - THE APPLICANT SHALL HAVE ALL THE SECTION 76 AGAINST ANY PERSON WHO, WITHOUT HIS AUTHORIZATION, EXERCISED ANY OF THE RIGHTS CONFERRED UNDER SECTION 71 OF THIS ACT IN RELATION TO THE INVENTION CLAIMED IN THE PUBLISHED PATENT APPLICATION, AS IF A PATENT HAD BEEN GRANTED FOR THAT INVENTION: PROVIDED, THAT THE SAID PERSON HAD: RIGHTS OF A PATENTEE UNDER

46.1. ACTUAL KNOWLEDGE THAT THE INVENTION THAT HE WAS USING WAS THE SUBJECT MATTER OF A PUBLISHED APPLICATION; OR 46.2. RECEIVED

WRITTEN NOTICE THAT THE INVENTION THAT HE WAS USING WAS THE SUBJECT MATTER OF A

PUBLISHED APPLICATION BEING IDENTIFIED IN THE SAID NOTICE BY ITS SERIAL NUMBER:

PROVIDED, THAT

THE

ACTION MAY NOT BE FILED UNTIL AFTER THE GRANT OF A PATENT ON THE PUBLISHED APPLICATION AND WITHIN FOUR (4) YEARS FROM THE COMMISSION OF THE ACTS COMPLAINED OF. (N)

SEC. 47. OBSERVATION BY THIRD PARTIES. - FOLLOWING THE PUBLICATION OF THE PATENT APPLICATION, ANY PERSON MAY PRESENT OBSERVATIONS IN WRITING CONCERNING THE PATENTABILITY OF THE INVENTION. SUCH OBSERVATIONS SHALL BE COMMUNICATED TO THE APPLICANT WHO MAY COMMENT ON THEM. THE OFFICE SHALL ACKNOWLEDGE AND PUT SUCH OBSERVATIONS AND COMMENT IN THE FILE OF THE APPLICATION TO WHICH IT RELATES. (N) SEC. 48. REQUEST FOR SUBSTANTIVE EXAMINATION. 48.1. THE APPLICATION SHALL BE DEEMED WITHDRAWN UNLESS WITHIN SIX (6) MONTHS FROM THE DATE OF PUBLICATION UNDER SECTION 41, A WRITTEN REQUEST TO DETERMINE WHETHER A PATENT APPLICATION MEETS THE REQUIREMENTS OF SECTIONS 21 TO 27 AND SECTIONS 32 TO 39 AND THE FEES HAVE BEEN PAID ON TIME. 48.2. WITHDRAWAL OF THE REQUEST FOR EXAMINATION SHALL BE IRREVOCABLE AND SHALL NOT AUTHORIZE THE REFUND OF ANY FEE. (N) SEC. 49. AMENDMENT OF APPLICATION. - AN APPLICANT MAY AMEND THE PATENT APPLICATION DURING EXAMINATION: PROVIDED, THAT SUCH AMENDMENT SHALL NOT INCLUDE NEW MATTER OUTSIDE THE SCOPE OF THE DISCLOSURE CONTAINED IN THE APPLICATION AS FILED. (N) SEC. 50. GRANT OF PATENT. 50.1. IF THE APPLICATION MEETS THE REQUIREMENTS PROVIDED, THAT ALL THE FEES ARE PAID ON TIME. 50.2. IF

OF THIS

ACT,

THE

OFFICE

SHALL GRANT THE PATENT:

THE REQUIRED FEES FOR GRANT AND PRINTING ARE NOT PAID IN DUE TIME, THE APPLICATION SHALL BE

DEEMED TO BE WITHDRAWN.

50.3. A PATENT SHALL TAKE EFFECT ON THE DATE OF THE PUBLICATION OF THE GRANT OF THE PATENT IN THE IPO GAZETTE. SEC. 51. REFUSAL OF THE APPLICATION. -

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51.1. THE FINAL ORDER OF REFUSAL OF THE DIRECTOR IN ACCORDANCE WITH THIS ACT.

EXAMINER TO GRANT THE PATENT SHALL BE APPEALABLE TO THE

51.2. THE REGULATIONS SHALL PROVIDE FOR THE FROM THE DIRECTOR SHALL BE UNDERTAKEN. (N)

PROCEDURE BY WHICH AN APPEAL FROM THE ORDER OF REFUSAL

SEC. 52. PUBLICATION UPON GRANT OF PATENT. 52.1. THE GRANT OF THE PATENT TOGETHER WITH OTHER RELATED INFORMATION SHALL BE PUBLISHED IN THE IPO GAZETTE WITHIN THE TIME PRESCRIBED BY THE REGULATIONS. 52.2. ANY INTERESTED PARTY MAY INSPECT THE COMPLETE DESCRIPTION, ON FILE WITH THE OFFICE.

CLAIMS, AND DRAWINGS OF THE PATENT

SEC. 53. CONTENTS OF PATENT. - THE PATENT SHALL BE ISSUED IN THE NAME OF THE REPUBLIC OF THE PHILIPPINES UNDER THE SEAL OF THE OFFICE AND SHALL BE SIGNED BY THE DIRECTOR, AND REGISTERED TOGETHER WITH THE DESCRIPTION, CLAIMS, AND DRAWINGS, IF ANY, IN BOOKS AND RECORDS OF THE OFFICE. SEC. 54. TERM OF PATENT. - THE

TERM OF A PATENT SHALL BE TWENTY

(20)

YEARS FROM THE FILING DATE OF THE

APPLICATION.

SEC. 55. ANNUAL FEES. 55.1. TO MAINTAIN THE PATENT APPLICATION OR PATENT, AN ANNUAL FEE SHALL BE PAID UPON THE EXPIRATION OF FOUR (4) YEARS FROM THE DATE THE APPLICATION WAS PUBLISHED PURSUANT TO SECTION 44 HEREOF, AND ON EACH SUBSEQUENT ANNIVERSARY OF SUCH DATE. PAYMENT MAY BE MADE WITHIN THREE (3) MONTHS BEFORE THE DUE DATE. THE OBLIGATION TO PAY THE ANNUAL FEES SHALL TERMINATE SHOULD THE APPLICATION BE WITHDRAWN, REFUSED, OR CANCELLED. 55.2. IF THE ANNUAL FEE IS NOT PAID,

THE PATENT APPLICATION SHALL BE DEEMED WITHDRAWN OR THE PATENT

CONSIDERED AS LAPSED FROM THE DAY FOLLOWING THE EXPIRATION OF THE PERIOD WITHIN WHICH THE ANNUAL FEES WERE DUE.

A

NOTICE THAT THE APPLICATION IS DEEMED WITHDRAWN OR THE LAPSE OF A PATENT FOR NON-

PAYMENT OF ANY ANNUAL FEE SHALL BE PUBLISHED IN THE THE

IPO GAZETTE

AND THE LAPSE SHALL BE RECORDED IN

REGISTER OF THE OFFICE.

55.3. A

GRACE PERIOD OF SIX

(6)

MONTHS SHALL BE GRANTED FOR THE PAYMENT OF THE ANNUAL FEE, UPON

PAYMENT OF THE PRESCRIBED SURCHARGE FOR DELAYED PAYMENT.

SEC. 56. SURRENDER OF PATENT. 56.1. THE OWNER OF THE PATENT, WITH THE CONSENT OF ALL PERSONS HAVING GRANTS OR LICENSES OR OTHER RIGHT, TITLE OR INTEREST IN AND TO THE PATENT AND THE INVENTION COVERED THEREBY, WHICH HAVE BEEN RECORDED IN THE OFFICE, MAY SURRENDER HIS PATENT OR ANY CLAIM OR CLAIMS FORMING PART THEREOF TO THE OFFICE FOR CANCELLATION. 56.2 A

PERSON MAY GIVE NOTICE TO THE

OFFICE OF HIS OPPOSITION TO THE SURRENDER OF A BUREAU SHALL NOTIFY THE PROPRIETOR

PATENT UNDER THIS SECTION, AND IF HE DOES SO, THE

OF THE PATENT

AND DETERMINE THE QUESTION.

56.3. IF THE OFFICE IS SATISFIED THAT THE PATENT MAY PROPERLY BE SURRENDERED, HE MAY ACCEPT THE OFFER IPO GAZETTE, THE PATENT SHALL CEASE TO HAVE EFFECT, BUT NO ACTION FOR INFRINGEMENT SHALL LIE AND NO RIGHT COMPENSATION SHALL ACCRUE FOR ANY USE OF THE PATENTED INVENTION BEFORE THAT DAY FOR THE SERVICES OF THE GOVERNMENT.

AND, AS FROM THE DAY WHEN NOTICE OF HIS ACCEPTANCE IS PUBLISHED IN THE

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SEC. 57. CORRECTION OF MISTAKES OF THE OFFICE. - THE DIRECTOR SHALL HAVE THE POWER TO CORRECT, WITHOUT FEE, ANY MISTAKE IN A PATENT INCURRED THROUGH THE FAULT OF THE OFFICE WHEN CLEARLY DISCLOSED IN THE RECORDS THEREOF, TO MAKE THE PATENT CONFORM TO THE RECORDS. SEC. 58. CORRECTION OF MISTAKE IN THE APPLICATION. - ON REQUEST OF ANY INTERESTED PERSON AND PAYMENT OF THE PRESCRIBED FEE, THE DIRECTOR IS AUTHORIZED TO CORRECT ANY MISTAKE IN A PATENT OF A FORMAL AND CLERICAL NATURE, NOT INCURRED THROUGH THE FAULT OF THE OFFICE. SEC. 59. CHANGES IN PATENTS. 59.1. THE OWNER OF A PATENT PATENT IN ORDER TO:

SHALL HAVE THE RIGHT TO REQUEST THE

BUREAU

TO MAKE THE CHANGES IN THE

(A) LIMIT THE EXTENT OF THE PROTECTION CONFERRED BY IT; (B) CORRECT OBVIOUS MISTAKES OR TO CORRECT CLERICAL ERRORS;

AND

(C) CORRECT MISTAKES OR ERRORS, OTHER THAN THOSE REFERRED TO IN LETTER (B), MADE IN GOOD FAITH: PROVIDED, THAT WHERE THE CHANGE WOULD RESULT IN A BROADENING OF THE EXTENT OF PROTECTION CONFERRED BY THE PATENT, NO REQUEST MAY BE MADE AFTER THE EXPIRATION OF TWO (2) YEARS FROM THE GRANT OF A PATENT AND THE CHANGE SHALL NOT AFFECT THE RIGHTS OF ANY THIRD PARTY WHICH HAS RELIED ON THE PATENT, AS PUBLISHED.

59.2. NO CHANGE IN THE PATENT SHALL BE PERMITTED UNDER THIS SECTION,

WHERE THE CHANGE WOULD RESULT

IN THE DISCLOSURE CONTAINED IN THE PATENT GOING BEYOND THE DISCLOSURE CONTAINED IN THE APPLICATION FILED.

59.3. IF,

AND TO THE EXTENT TO WHICH THE

OFFICE

CHANGES THE PATENT ACCORDING TO THIS SECTION, IT

SHALL PUBLISH THE SAME. (N)

SEC. 60. FORM AND PUBLICATION OF AMENDMENT. - AN

AMENDMENT OR CORRECTION OF A PATENT SHALL BE

ACCOMPLISHED BY A CERTIFICATE OF SUCH AMENDMENT OR CORRECTION, AUTHENTICATED BY THE SEAL OF THE SIGNED BY THE

DIRECTOR,

WHICH CERTIFICATE SHALL BE ATTACHED TO THE PATENT.

CORRECTION SHALL BE PUBLISHED IN THE

IPO GAZETTE

NOTICE

OFFICE AND

OF SUCH AMENDMENT OR

AND COPIES OF THE PATENT KEPT OR FURNISHED BY THE

OFFICE

SHALL INCLUDE A COPY OF THE CERTIFICATE OF AMENDMENT OR CORRECTION.

CHAPTER VI CANCELLATION OF PATENTS AND SUBSTITUTION OF PATENTEE

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.

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SEC. 62. REQUIREMENT OF THE PETITION. - THE

PETITION FOR CANCELLATION SHALL BE IN WRITING, VERIFIED BY THE

PETITIONER OR BY ANY PERSON IN HIS BEHALF WHO KNOWS THE FACTS, SPECIFY THE GROUNDS UPON WHICH IT IS BASED, INCLUDE A STATEMENT OF THE FACTS TO BE RELIED UPON, AND FILED WITH THE

OFFICE. COPIES OF PRINTED PUBLICATIONS

OR OF PATENTS OF OTHER COUNTRIES, AND OTHER SUPPORTING DOCUMENTS MENTIONED IN THE PETITION SHALL BE ATTACHED THERETO, TOGETHER WITH THE TRANSLATION THEREOF IN

ENGLISH,

IF NOT IN ENGLISH LANGUAGE.

SEC. 63. NOTICE OF HEARING. - UPON FILING OF A PETITION FOR CANCELLATION,

THE

DIRECTOR OF LEGAL AFFAIRS SHALL

FORTHWITH SERVE NOTICE OF THE FILING THEREOF UPON THE PATENTEE AND ALL PERSONS HAVING GRANTS OR LICENSES, OR ANY OTHER RIGHT, TITLE OR INTEREST IN AND TO THE PATENT AND THE INVENTION COVERED THEREBY, AS APPEARS OF

OFFICE, AND OF NOTICE OF THE DATE OF HEARING THEREON ON NOTICE OF THE FILING OF THE PETITION SHALL BE PUBLISHED IN THE IPO GAZETTE.

RECORD IN THE

SUCH PERSONS AND THE PETITIONER.

SEC. 64. COMMITTEE OF THREE. - IN CASES INVOLVING HIGHLY TECHNICAL ISSUES, ON MOTION OF ANY PARTY, THE DIRECTOR OF LEGAL AFFAIRS MAY ORDER THAT THE PETITION BE HEARD AND DECIDED BY A COMMITTEE COMPOSED OF THE DIRECTOR OF LEGAL AFFAIRS AS CHAIRMAN AND TWO (2) MEMBERS WHO HAVE THE EXPERIENCE OR EXPERTISE IN THE FIELD OF TECHNOLOGY TO WHICH THE PATENT SOUGHT TO BE CANCELLED RELATES. THE DECISION OF THE COMMITTEE SHALL BE APPEALABLE TO THE DIRECTOR GENERAL. (N) SEC. 65. CANCELLATION OF THE PATENT. 65.1. IF THE COMMITTEE FINDS THAT A CASE FOR CANCELLATION HAS BEEN PROVED, OR ANY SPECIFIED CLAIM OR CLAIMS THEREOF CANCELLED. 65.2. IF

THE

COMMITTEE

IT SHALL ORDER THE PATENT

FINDS THAT, TAKING INTO CONSIDERATION THE AMENDMENT MADE BY THE PATENTEE

DURING THE CANCELLATION PROCEEDINGS, THE PATENT AND THE INVENTION TO WHICH IT RELATES MEET THE REQUIREMENT OF THIS

ACT,

65.3. IF

PROVIDED, THAT REGULATIONS.

IT MAY DECIDE TO MAINTAIN THE PATENT AS AMENDED:

FOR PRINTING OF A NEW PATENT IS PAID WITHIN THE TIME LIMIT PRESCRIBED IN THE

THE FEE

THE FEE FOR THE PRINTING OF A NEW PATENT IS NOT PAID IN DUE TIME, THE PATENT SHOULD BE

REVOKED.

65.4. IF THE PATENT IS AMENDED UNDER SUBSECTION 65.2

HEREOF, THE

BUREAU SHALL,

AT THE SAME TIME AS

IT PUBLISHES THE MENTION OF THE CANCELLATION DECISION, PUBLISH THE ABSTRACT, REPRESENTATIVE CLAIMS AND DRAWINGS INDICATING CLEARLY WHAT THE AMENDMENTS CONSIST OF. (N)

SEC. 66. EFFECT OF CANCELLATION OF PATENT OR CLAIM. - THE RIGHTS CONFERRED BY THE PATENT OR ANY SPECIFIED CLAIM OR CLAIMS CANCELLED SHALL TERMINATE. NOTICE OF THE CANCELLATION SHALL BE PUBLISHED IN THE IPO GAZETTE. UNLESS RESTRAINED BY THE DIRECTOR GENERAL, THE DECISION OR ORDER TO CANCEL BY DIRECTOR OF LEGAL AFFAIRS SHALL BE IMMEDIATELY EXECUTORY EVEN PENDING APPEAL. MAGUAN V. CA Swan Manufacturing is patent holder of powder puff. It discovered that Susana Luchan was manufacturing its powder puffs and sent a cease and desist letter. Luchan claims that the patents are void since the patents when applied for was not new and patentable. Luchan filed a petition for the cancellation of the UM & Patent. Swan then filed a complaint for damages with injunction. RTC granted injunction. Swan claims this is erroneous since there is a pending cancellation proceeding in the Patent Office. Held: The burden of proof to substantiate a charge of infringement is with the plaintiff. But where the plaintiff introduces the patent in evidence, and

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is in due form, this creates a prima facie presumption of its correctness and validity. The burden of going forward with evidence then shifts to defendant to overcome by competent evidence this presumption. Here, there is a serious challenge as to the novelty of the patent, and there has been sufficient proof showing a fair question of the invalidity of the patent issued for such models. It is but right that evidence be looked into. The RTC failed to satisfy the two requirements for an injunction, that is, the existence of a right to be protected and the violation of such right. An RTC has jurisdiction to determine the issue of novelty when a patent is sought to be enforced, for the purpose of deciding whether or not to issue a writ of preliminary injunction. Q. A patent infringement case is filed in the RTC. the other party files for the cancellation of the patent in the IPO. Can the patent owner claim Sec. 151.2 of the IP Code that petitions for cancellation is not a prejudicial question, as in trademark cases? A. No. There is a regulation in the patent office adopting the rule that whichever body (the court or the IPO) acquires jurisdiction first will resolve the case. Its jurisdiction is continued and may not be stopped by another case. Q. What if the cancellation case is filed first before the infringement case, and the IPO makes a ruling, canceling the patent. Is the RTC automatically required to make a finding that there is no infringement? A. Sapalo (privately): Usually, the party whose patent was cancelled will appeal. Eventually, the cancellation and infringement case will be consolidated in the CA.

CHAPTER VII REMEDIES OF A PERSON WITH A RIGHT TO A PATENT SEC. 67. PATENT APPLICATION BY PERSONS NOT HAVING THE RIGHT TO A PATENT. 67.1. IF A PERSON REFERRED TO IN SECTION 29 OTHER THAN THE APPLICANT, IS DECLARED BY FINAL COURT ORDER OR DECISION AS HAVING THE RIGHT TO THE PATENT, SUCH PERSON MAY, WITHIN THREE (3) MONTHS AFTER THE DECISION HAS BECOME FINAL: (A) PROSECUTE THE APPLICATION AS HIS OWN APPLICATION IN PLACE OF THE APPLICANT; (B) FILE A NEW PATENT APPLICATION IN RESPECT OF THE SAME INVENTION; (C) REQUEST THAT THE APPLICATION BE REFUSED; (D) SEEK CANCELLATION OF THE PATENT, 67.2. THE PROVISIONS OF SUBSECTION 38.2 SUBSECTION 67.1(B). (N)

OR

IF ONE HAS ALREADY BEEN ISSUED.

SHALL APPLY MUTATIS MUTANDIS TO A NEW APPLICATION FILED

UNDER

SEC. 68. REMEDIES OF THE TRUE AND ACTUAL INVENTOR. - IF A PERSON, WHO WAS DEPRIVED OF THE PATENT WITHOUT HIS CONSENT OR THROUGH FRAUD IS DECLARED BY FINAL COURT ORDER OR DECISION TO BE THE TRUE AND ACTUAL INVENTOR, THE COURT SHALL ORDER FOR HIS SUBSTITUTION AS PATENTEE, OR AT THE OPTION OF THE TRUE INVENTOR, CANCEL THE PATENT, AND AWARD ACTUAL AND OTHER DAMAGES IN HIS FAVOR IF WARRANTED BY THE CIRCUMSTANCES. SEC. 69. PUBLICATION OF THE COURT ORDER. - THE COURT SHALL FURNISH THE OFFICE A COPY OF THE ORDER OR DECISION REFERRED TO IN SECTIONS 67 AND 68, WHICH SHALL BE PUBLISHED IN THE IPO GAZETTE WITHIN THREE (3) MONTHS

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FROM THE DATE SUCH ORDER OR DECISION BECAME FINAL AND EXECUTORY, AND SHALL BE RECORDED IN THE REGISTER OF THE

OFFICE. (N) SEC. 70. TIME TO FILE ACTION IN COURT. - THE ACTIONS INDICATED IN SECTIONS 67 AND 68 SHALL BE FILED WITHIN ONE (1) YEAR FROM THE DATE OF PUBLICATION MADE IN ACCORDANCE WITH SECTIONS 44 AND 51, RESPECTIVELY. (N) CHAPTER VIII RIGHTS OF PATENTEES AND INFRINGEMENT OF PATENTS 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.

SEC. 72. LIMITATIONS OF PATENT RIGHTS. - THE OWNER OF A PATENT HAS NO RIGHT TO PREVENT THIRD PARTIES FROM PERFORMING, WITHOUT HIS AUTHORIZATION, THE ACTS REFERRED TO IN SECTION 71 HEREOF IN THE FOLLOWING CIRCUMSTANCES: 72.1 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, PHILIPPINES

ENTERING THE TERRITORY OF THE

VESSEL, AIRCRAFT, OR LAND VEHICLE OF ANY OTHER COUNTRY 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.

SEC. 73. PRIOR USER. -

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73.1. NOTWITHSTANDING SECTION 72

HEREOF, ANY PRIOR USER, WHO, IN GOOD FAITH WAS USING THE

INVENTION OR HAS UNDERTAKEN SERIOUS PREPARATIONS TO USE THE INVENTION IN HIS ENTERPRISE OR BUSINESS, BEFORE THE FILING DATE OR PRIORITY DATE OF THE APPLICATION ON WHICH A PATENT IS GRANTED, SHALL HAVE THE RIGHT TO CONTINUE THE USE THEREOF AS ENVISAGED IN SUCH PREPARATIONS WITHIN THE TERRITORY WHERE THE PATENT PRODUCES ITS EFFECT.

73.2. THE

RIGHT OF THE PRIOR USER MAY ONLY BE TRANSFERRED OR ASSIGNED TOGETHER WITH HIS ENTERPRISE

OR BUSINESS, OR WITH THAT PART OF HIS ENTERPRISE OR BUSINESS IN WHICH THE USE OR PREPARATIONS FOR USE HAVE BEEN MADE.

SEC. 74. USE OF INVENTION BY GOVERNMENT. 74.1. A GOVERNMENT AGENCY OR THIRD PERSON AUTHORIZED BY THE GOVERNMENT MAY EXPLOIT THE INVENTION EVEN WITHOUT AGREEMENT OF THE PATENT OWNER WHERE: (A) THE PUBLIC INTEREST, IN PARTICULAR, NATIONAL SECURITY, NUTRITION, 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.

74.2. THE

USE BY THE

GOVERNMENT,

OR THIRD PERSON AUTHORIZED BY THE

MUTATIS MUTANDIS, TO THE CONDITIONS SET FORTH IN

SECTIONS 95

GOVERNMENT

SHALL BE SUBJECT,

TO 97 AND 100 TO 102.

SEC. 75. EXTENT OF PROTECTION AND INTERPRETATION OF CLAIMS. 75.1. THE EXTENT OF PROTECTION CONFERRED BY THE PATENT SHALL BE DETERMINED BY THE CLAIMS, TO BE INTERPRETED IN THE LIGHT OF THE DESCRIPTION AND DRAWINGS. 75.2. FOR THE PURPOSE OF DETERMINING THE EXTENT OF PROTECTION CONFERRED BY THE PATENT,

WHICH ARE

DUE ACCOUNT

SHALL BE TAKEN OF ELEMENTS WHICH ARE EQUIVALENT TO THE ELEMENTS EXPRESSED IN THE CLAIMS, SO THAT A CLAIM SHALL BE CONSIDERED TO COVER NOT ONLY ALL THE ELEMENTS AS EXPRESSED THEREIN, BUT ALSO EQUIVALENTS.

GSELL V. YAP-JUE Gsell has a patent the manufacturing of canes and umbrellas with a curved handle by means of lamp or blowpipe fed with oil or petroleum. He filed an action for infringement and for injunction against Yap-Jue, and obtained it. But Yap-Jue continued to manufacture the products. Yap claims that it does not use coal or mineral oil, but it uses an alcohol burning lamp. Issue: Whether or not the use of a patented process by a third person without license constitutes an infringement when the alleged infringer has substituted some unessential part with a well-known mechanical equivalent. Held: Alcohol is an equivalent or substitute well known when the patent was issued. It is an unessential part of the patented process. Gsell does not claim a patent on the particular lamp used by him, but the claims on the right to use a lamp in the manufacture of curved handles for umbrellas. The doctrine of mechanical equivalents is applicable in this case. This doctrine may be invoked to protect the patentee from colorable invasions of his patent under the guise of a substitution of some part of his invention by

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some well-known mechanical equivalent. Mere formal alterations in a combination is no defense to the charge of infringement and the withdrawal of one ingredient from the patent and the substitution of another which was well known at the date of the patent is a mere formal alteration.

SEC. 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: TIMES THE AMOUNT OF SUCH ACTUAL DAMAGES.

76.5. THE

PROVIDED, THAT

THE AWARD DOES NOT EXCEED THREE

(3)

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.

CRESSER V. CA Floro was granted a patent for aerial fuze. Later, he discovered that Cresser Precision submitted samples of its patented aerial fuze to AFP for testing, claiming it owned the patent for the same and planned to manufacture it. Floro sent a cease and desist letter to Cresser. Cresser in turn filed a complaint for injunction and infringement before the RTC, claiming that it is the first, true and actual inventor. RTC issued injunction. Floro claims Cresser has no cause of action for infringement, not being a patent holder. Cresser claims it files its action as an entity in possession of a right and the lack of patent does not bar the first true and actual inventor from suing. Held: Not tenable. Under the law, only the patentee or his successor-ininterest may file an action for infringement. The phrase in the law, “anyone possessing a right” refers only to the patentee’s successor-in-interest. No infringement of a patent can be filed until a patent has been issued. Anyone who has no patent but claims to have a right thereto cannot file an action

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for injunction. But he can file a petition for cancellation of the patent within 3 years from the publication of said patent and raise as ground that the holder of the patent is not the real true inventor. Since the period has prescribed, it can no longer assail or impugn the validity of the patent. Aguas v. De Leon Conrado De Leon filed a complaint for infringement against Aguas claiming that he is the original inventor of new and useful improvements in the process of making mosaic pre-cast tiles and he possesses the Philippine patent, and that Aguas has been making the tiles thru the same manner and is guilty of infringement. As a defense, Aguas claims that the process has been known and used in RP by almost all tile makers long before the alleged use and registration, so registration did not confer any right on the plaintiff. Held: There is a new improvement because the new process allows for concrete sculpted tile preventing the flaking off of edges and allowing the molds to be deep enough to produce tiles for sculpture and decorative purposes but strong enough to be utilized for walling purposes. The validity

of the patents issued by the Patent Office in favor of Aguas and questions involving the inventiveness, novelty, and usefulness are matters better determined by the patent office. There is a presumption that the Patent office has correctly determined the patentability of the improvement by the Aguas of the process.

Here, considering the wantonness of the infringement committed by the defendants who knew all the time about the existence of plaintiff’s patent, there is a need to grant maximum damages to discourage patent infringements and to give more teeth to the provisions of the patent law, promoting stronger public policy to afford greater incentives and protection to inventor. Exemplary damages also awarded.

Q. Aside from filing the case in court, do you have any other alternative? A. Yes. You can file the case with the Bureau of Legal Affairs (BLA) of the IPO. The BLA exercises original jurisdiction in administrative complaints for violations of laws involving intellectual property rights but its jurisdiction is limited to complaints where the total damages claimed are not less than Two hundred thousand pesos (P200,000). Q. What is the appellate process? A. BLA Director General CA Q. Can the BLA punish for contempt? A. Code says: The Director of Legal Affairs shall have the power to hold and punish for contempt all those who disregard orders or writs issued in the course of the proceedings. Sapalo however says that this is a criminal remedy, and only the courts can punish for contempt. SEC. 77. INFRINGEMENT ACTION BY A FOREIGN NATIONAL. - ANY FOREIGN NATIONAL OR JURIDICAL ENTITY WHO MEETS THE REQUIREMENTS OF SECTION 3 AND NOT ENGAGED IN BUSINESS IN THE PHILIPPINES, TO WHICH A PATENT HAS BEEN GRANTED OR ASSIGNED UNDER THIS ACT, MAY BRING AN ACTION FOR INFRINGEMENT OF PATENT, WHETHER OR NOT IT IS LICENSED TO DO BUSINESS IN THE PHILIPPINES UNDER EXISTING LAW.

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Q. X buys pharmaceuticals from Pfeizer affiliate in Shenzhen then you sell in RP. Pfeizer RP files case for infringement. Will it prosper? In other words, is there already an exhaustion of the right, after the first distribution, like in copyright? A. No exhaustion. But it would be different if it were brought from Pfeizer RP, then the case will prosper. Q. What factors should you consider? A. 1. time element 2. territory – there is no such thing as an international patent. For example, the US can’t enforce its patents in RP. 4. compulsory license – is there one? If none, there is infringement. SEC. 78. PROCESS PATENTS; BURDEN OF PROOF. - IF THE SUBJECT MATTER OF A PATENT IS A PROCESS FOR OBTAINING A PRODUCT, ANY IDENTICAL PRODUCT SHALL BE PRESUMED TO HAVE BEEN OBTAINED THROUGH THE USE OF THE PATENTED PROCESS IF THE PRODUCT IS NEW OR THERE IS SUBSTANTIAL LIKELIHOOD THAT THE IDENTICAL PRODUCT WAS MADE BY THE PROCESS AND THE OWNER OF THE PATENT HAS BEEN UNABLE DESPITE REASONABLE EFFORTS, TO DETERMINE THE PROCESS ACTUALLY USED.

IN

ORDERING THE DEFENDANT TO PROVE THAT THE PROCESS TO OBTAIN THE IDENTICAL PRODUCT IS

DIFFERENT FROM THE PATENTED PROCESS, THE COURT SHALL ADOPT MEASURES TO PROTECT, AS FAR AS PRACTICABLE, HIS MANUFACTURING AND BUSINESS SECRETS. (N)

Q. What is an important factor to consider in patent infringement cases? A. You should consider the scope of the claims stated in the invention. So when filing an application, the claims should be wide enough to grant you sufficient protection, but not so wide as to be rejected by the Patent office. Q. Who has the burden of proof? A. The defendant has the burden of proof, since according to Sec. 78, “any identical product shall be presumed to be obtained through the use of the patented process.” GODINES V. CA SV Agro, owner of the patent for hand tractor or power tiller. Its sales suffered a decline and it discovered that the power tillers were being manufactured and sold by Godines. It filed for an infringement case against Godines. Godines claims that he was not engaged in manufacture and sale and that they were made only on special order of his customers who gave their own specifications. Held: It is unbelievable that Godines would fabricate power tillers upon specification without requiring job orders. It is also highly unusual for buyers to order the fabrication of a power tiller based merely on verbal specifications. The tests for infringement are (1) literal infringement and (2) doctrine of equivalents. In literal infringement, resort is had to the words of the claim. If the accused matter clearly falls within the claim, infringement is made out. Court juxtaposes the claim 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. Here, the claims of the patent and features were copied by Godines, so there is infringement. But minor modifications in a patented invention are sufficient to put them beyond the scope of literal infringement. So in doctrine of equivalents, infringement also occurs when a device appropriates a prior invention by incorporating its innovative concept and performs substantially

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the same function in substantially the same way to achieve substantially the same result. This is because to allow the imitation of a patented invention which does not copy any literal detail would be to convert the protection of the patent to a hollow thing. SEC. 79. LIMITATION OF ACTION FOR DAMAGES. - NO DAMAGES CAN BE RECOVERED FOR ACTS (4) YEARS BEFORE THE INSTITUTION OF THE ACTION FOR INFRINGEMENT.

OF INFRINGEMENT

COMMITTED MORE THAN FOUR

SEC. 80. DAMAGES; REQUIREMENT OF NOTICE. - DAMAGES CANNOT BE RECOVERED FOR ACTS OF INFRINGEMENT COMMITTED 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. BEFORE THE INFRINGER HAD KNOWN; OR HAD REASONABLE GROUNDS TO KNOW OF THE PATENT.

SEC. 81. DEFENSES IN ACTION FOR INFRINGEMENT. - IN

AN ACTION FOR INFRINGEMENT, THE DEFENDANT, IN ADDITION

TO OTHER DEFENSES AVAILABLE TO HIM, MAY SHOW THE INVALIDITY OF THE PATENT, OR ANY CLAIM THEREOF, ON ANY OF THE GROUNDS ON WHICH A PETITION OF CANCELLATION CAN BE BROUGHT UNDER

SECTION 61

HEREOF.

SEC. 82. PATENT FOUND INVALID MAY BE CANCELLED. - IN AN ACTION FOR INFRINGEMENT, IF THE COURT SHALL FIND THE PATENT OR ANY CLAIM TO BE INVALID, IT SHALL CANCEL THE SAME, AND THE DIRECTOR OF LEGAL AFFAIRS UPON RECEIPT OF THE FINAL JUDGMENT OF CANCELLATION BY THE COURT, SHALL RECORD THAT FACT IN THE REGISTER OF THE OFFICE AND SHALL PUBLISH A NOTICE TO THAT EFFECT IN THE IPO GAZETTE. SEC. 83. ASSESSOR IN INFRINGEMENT ACTION. 83.1. TWO (2) OR MORE ASSESSORS MAY BE APPOINTED BY THE COURT. THE ASSESSORS SHALL BE POSSESSED OF THE NECESSARY SCIENTIFIC AND TECHNICAL KNOWLEDGE REQUIRED BY THE SUBJECT MATTER IN LITIGATION. EITHER PARTY MAY CHALLENGE THE FITNESS OF ANY ASSESSOR PROPOSED FOR APPOINTMENT. 83.2. EACH ASSESSOR SHALL RECEIVE A COMPENSATION IN AN AMOUNT TO BE FIXED BY THE COURT AND ADVANCED BY THE COMPLAINING PARTY, WHICH SHALL BE AWARDED AS PART OF HIS COSTS SHOULD HE PREVAIL IN THE ACTION. Sec. 84. 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 prescribed in three (3) years from date of the commission of the crime. Q. Which court has jurisdiction over patent infringement cases? Does it depend on the jurisdictional amounts in the Rules of Court? A. The RTC has exclusive jurisdiction, based on an SC circular which designates certain RTCs as IP courts. So even if penalties fall under the MTC, the case should be filed in the RTC. CHAPTER IX VOLUNTARY LICENSING SEC. 85. VOLUNTARY LICENSE CONTRACT. - TO ENCOURAGE THE TRANSFER AND DISSEMINATION OF TECHNOLOGY,

PREVENT

OR CONTROL PRACTICES AND CONDITIONS THAT MAY IN PARTICULAR CASES CONSTITUTE AN ABUSE OF INTELLECTUAL

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PROPERTY RIGHTS HAVING AN ADVERSE EFFECT ON COMPETITION AND TRADE, ALL TECHNOLOGY TRANSFER ARRANGEMENTS SHALL COMPLY WITH THE PROVISIONS OF THIS

CHAPTER. (N)

SEC. 86. JURISDICTION TO SETTLE DISPUTES ON ROYALTIES. - THE DIRECTOR OF THE DOCUMENTATION, INFORMATION AND TECHNOLOGY TRANSFER BUREAU SHALL EXERCISE QUASI-JUDICIAL JURISDICTION IN THE SETTLEMENT OF DISPUTES BETWEEN PARTIES TO A TECHNOLOGY TRANSFER ARRANGEMENT ARISING FROM TECHNOLOGY TRANSFER PAYMENTS, INCLUDING THE FIXING OF APPROPRIATE AMOUNT OR RATE OF ROYALTY. (N) SEC. 87. PROHIBITED CLAUSES. - EXCEPT

IN CASES UNDER

SECTION 91,

THE FOLLOWING PROVISIONS SHALL BE DEEMED

PRIMA FACIE TO HAVE AN ADVERSE ON COMPETITION AND TRADE:

87.1. THOSE WHICH IMPOSE UPON THE LICENSEE THE OBLIGATION TO ACQUIRE FROM A SPECIFIC SOURCE CAPITAL GOODS, INTERMEDIATE PRODUCTS, RAW MATERIALS, AND OTHER TECHNOLOGIES, OR OF PERMANENTLY EMPLOYING PERSONNEL INDICATED BY THE LICENSOR; 87.2. THOSE PURSUANT TO WHICH THE LICENSOR RESERVES THE RIGHT TO FIX THE SALE OR RESALE PRICES OF THE PRODUCTS MANUFACTURED ON THE BASIS OF THE LICENSE;

87.3. THOSE THAT CONTAIN RESTRICTIONS REGARDING THE VOLUME AND STRUCTURE OF PRODUCTION; 87.4 THOSE

THAT PROHIBIT THE USE OF COMPETITIVE TECHNOLOGIES IN A NON-EXCLUSIVE TECHNOLOGY

TRANSFER AGREEMENT;

87.5. THOSE THAT ESTABLISH A FULL OR PARTIAL PURCHASE OPTION IN FAVOR OF THE LICENSOR; 87.6. THOSE

THAT OBLIGATE THE LICENSEE TO TRANSFER FOR FREE TO THE LICENSOR THE INVENTIONS OR

IMPROVEMENTS THAT MAY BE OBTAINED THROUGH THE USE OF THE LICENSED TECHNOLOGY;

87.7. THOSE THAT REQUIRE PAYMENT OF ROYALTIES TO THE OWNERS OF PATENTS FOR PATENTS WHICH ARE NOT USED; 87.8. THOSE

THAT PROHIBIT THE LICENSEE TO EXPORT THE LICENSED PRODUCT UNLESS JUSTIFIED FOR THE

PROTECTION OF THE LEGITIMATE INTEREST OF THE LICENSOR SUCH AS EXPORTS TO COUNTRIES WHERE EXCLUSIVE LICENSES TO MANUFACTURE AND/OR DISTRIBUTE THE LICENSED PRODUCT(S) HAVE ALREADY BEEN GRANTED;

87.9. THOSE

WHICH RESTRICT THE USE OF THE TECHNOLOGY SUPPLIED AFTER THE EXPIRATION OF THE

TECHNOLOGY TRANSFER ARRANGEMENT, EXCEPT IN CASES OF EARLY TERMINATION OF THE TECHNOLOGY TRANSFER ARRANGEMENT DUE TO REASON(S) ATTRIBUTABLE TO THE LICENSEE;

87.10. THOSE

WHICH REQUIRE PAYMENTS FOR PATENTS AND OTHER INDUSTRIAL PROPERTY RIGHTS AFTER THEIR

EXPIRATION, TERMINATION ARRANGEMENT;

87.11. THOSE

WHICH REQUIRE THAT THE TECHNOLOGY RECIPIENT SHALL NOT CONTEST THE VALIDITY OF ANY OF

THE PATENTS OF THE TECHNOLOGY SUPPLIER;

87.12. THOSE

WHICH RESTRICT THE RESEARCH AND DEVELOPMENT ACTIVITIES OF THE LICENSEE DESIGNED TO

ABSORB AND ADAPT THE TRANSFERRED TECHNOLOGY TO LOCAL CONDITIONS OR TO INITIATE RESEARCH AND DEVELOPMENT PROGRAMS IN CONNECTION WITH NEW PRODUCTS, PROCESSES OR EQUIPMENT;

87.13. THOSE WHICH PREVENT THE LICENSEE FROM ADAPTING THE IMPORTED TECHNOLOGY TO LOCAL CONDITIONS, OR INTRODUCING INNOVATION TO IT, AS LONG AS IT DOES NOT IMPAIR THE QUALITY STANDARDS PRESCRIBED BY THE LICENSOR;

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87.14. THOSE

WHICH EXEMPT THE LICENSOR FOR LIABILITY FOR NON-FULFILLMENT OF HIS RESPONSIBILITIES

UNDER THE TECHNOLOGY TRANSFER ARRANGEMENT AND/OR LIABILITY ARISING FROM THIRD PARTY SUITS BROUGHT ABOUT BY THE USE OF THE LICENSED PRODUCT OR THE LICENSED TECHNOLOGY; AND

87.15. OTHER CLAUSES WITH EQUIVALENT EFFECTS. SEC. 88. MANDATORY PROVISIONS. - THE

FOLLOWING PROVISIONS SHALL BE INCLUDED IN VOLUNTARY LICENSE

CONTRACTS:

88.1. THAT THE LAWS OF THE PHILIPPINES SHALL GOVERN THE INTERPRETATION OF THE SAME AND IN THE EVENT OF LITIGATION, THE VENUE SHALL BE THE PROPER COURT IN THE PLACE WHERE THE LICENSEE HAS ITS PRINCIPAL OFFICE; 88.2. CONTINUED

ACCESS TO IMPROVEMENTS IN TECHNIQUES AND PROCESSES RELATED TO THE TECHNOLOGY

SHALL BE MADE AVAILABLE DURING THE PERIOD OF THE TECHNOLOGY TRANSFER ARRANGEMENT;

88.3. IN THE EVENT THE TECHNOLOGY TRANSFER ARRANGEMENT SHALL PROVIDE FOR ARBITRATION, THE PROCEDURE OF ARBITRATION OF THE ARBITRATION LAW OF THE PHILIPPINES OR THE ARBITRATION RULES OF THE UNITED NATIONS COMMISSION ON INTERNATIONAL TRADE LAW (UNCITRAL) OR THE RULES OF CONCILIATION AND ARBITRATION OF THE INTERNATIONAL CHAMBER OF COMMERCE (ICC) SHALL APPLY AND THE VENUE OF ARBITRATION SHALL BE THE PHILIPPINES OR ANY NEUTRAL COUNTRY; AND 88.4. THE PHILIPPINE TAXES ON ALL PAYMENTS RELATING TO THE TECHNOLOGY TRANSFER ARRANGEMENT SHALL BE BORNE BY THE LICENSOR. (N) Q. Does a Technology Transfer Agreement need to be registered? A. General rule: No. Exception: When you want to fall under the exceptions, that is, you want to have in your TTA, a provision which falls under the prohibited clauses. This may be allowed when it falls under Sec. 91, that is, in exceptional or meritorious cases where substantial benefits will accrue to the economy. SEC. 89. RIGHTS OF LICENSOR. - IN

THE ABSENCE OF ANY PROVISION TO THE CONTRARY IN THE TECHNOLOGY TRANSFER

ARRANGEMENT, THE GRANT OF A LICENSE SHALL NOT PREVENT THE LICENSOR FROM GRANTING FURTHER LICENSES TO THIRD PERSON NOR FROM EXPLOITING THE SUBJECT MATTER OF THE TECHNOLOGY TRANSFER ARRANGEMENT HIMSELF.

SEC. 90. RIGHTS OF LICENSEE. - THE LICENSEE SHALL BE ENTITLED TO EXPLOIT THE SUBJECT MATTER OF THE TECHNOLOGY

TRANSFER ARRANGEMENT DURING THE WHOLE TERM OF THE TECHNOLOGY TRANSFER ARRANGEMENT.

SEC. 91. EXCEPTIONAL CASES. - IN EXCEPTIONAL OR MERITORIOUS CASES WHERE SUBSTANTIAL BENEFITS WILL ACCRUE TO THE ECONOMY, SUCH AS HIGH TECHNOLOGY CONTENT, INCREASE IN FOREIGN EXCHANGE EARNINGS, EMPLOYMENT GENERATION, REGIONAL DISPERSAL OF INDUSTRIES AND/OR SUBSTITUTION WITH OR USE OF LOCAL RAW MATERIALS, OR IN THE CASE OF BOARD OF INVESTMENTS, REGISTERED COMPANIES WITH PIONEER STATUS, EXEMPTION FROM ANY OF THE ABOVE REQUIREMENTS MAY BE ALLOWED BY THE DOCUMENTATION, INFORMATION AND TECHNOLOGY TRANSFER BUREAU AFTER EVALUATION THEREOF ON A CASE BY CASE BASIS. (N) SEC. 92. NON-REGISTRATION WITH THE DOCUMENTATION, INFORMATION AND TECHNOLOGY TRANSFER BUREAU. TECHNOLOGY TRANSFER ARRANGEMENTS THAT CONFORM WITH THE PROVISIONS OF SECTIONS 86 AND 87 NEED NOT BE REGISTERED WITH THE DOCUMENTATION, INFORMATION AND TECHNOLOGY TRANSFER BUREAU. NON-CONFORMANCE WITH ANY OF THE PROVISIONS OF SECTIONS 87 AND 88, HOWEVER, SHALL AUTOMATICALLY RENDER THE TECHNOLOGY TRANSFER ARRANGEMENT UNENFORCEABLE, UNLESS SAID TECHNOLOGY TRANSFER ARRANGEMENT IS APPROVED AND REGISTERED WITH

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DOCUMENTATION, INFORMATION EXCEPTIONAL CASES. (N)

THE

AND

TECHNOLOGY TRANSFER BUREAU

UNDER THE PROVISIONS OF

SECTION 91

ON

Q. What is the effect of the non-registration of TTA which contains a prohibited clause? A. Sec. 92 says that it is UNENFORCEABLE. The question is, what precisely is unenforceable: the entire contract or just the prohibited clause? It seems that to render the entire contract unenforceable would be unjust, since benefits would be acquired without any compensation. Of course, there may be partial fulfillment on the part of the transferor, so there can be a claim of partial fulfillment, taking the case out of unenforceable contracts (or does this apply on in Statute of Frauds cases?) Q. Are these provisions applicable in a TTA between Filipinos? A. Yes. Sec. 85 says, “all technology transfer arrangements shall comply with the provisions of this Chapter.” Q. Where do you register the TTA? A. You register it with the Documentation, Information, and Technology Transfer Bureau (DITTB). CHAPTER X COMPULSORY LICENSING SEC. 93. GROUNDS FOR COMPULSORY LICENSING. - THE DIRECTOR OF LEGAL AFFAIRS MAY GRANT A LICENSE TO EXPLOIT A

PATENTED INVENTION, EVEN WITHOUT THE AGREEMENT OF THE PATENT OWNER, IN FAVOR OF ANY PERSON WHO HAS SHOWN HIS CAPABILITY TO EXPLOIT THE INVENTION, UNDER ANY OF THE FOLLOWING CIRCUMSTANCES:

93.1. NATIONAL EMERGENCY OR OTHER CIRCUMSTANCES OF EXTREME URGENCY; 93.2. WHERE

THE PUBLIC INTEREST, IN PARTICULAR, NATIONAL SECURITY, NUTRITION, HEALTH OR THE

DEVELOPMENT OF OTHER VITAL SECTORS OF THE NATIONAL ECONOMY AS DETERMINED BY THE APPROPRIATE AGENCY OF THE GOVERNMENT, SO REQUIRES; OR

93.3. WHERE

A JUDICIAL OR ADMINISTRATIVE BODY HAS DETERMINED THAT THE MANNER OF EXPLOITATION BY

THE OWNER OF THE PATENT OR HIS LICENSEE IS ANTI-COMPETITIVE; OR

93.4. IN REASON;

CASE OF PUBLIC NON-COMMERCIAL USE OF THE PATENT BY THE PATENTEE, WITHOUT SATISFACTORY

93.5. IF

THE PATENTED INVENTION IS NOT BEING WORKED IN THE

PHILIPPINES ON A COMMERCIAL SCALE, PROVIDED, THAT THE IMPORTATION OF THE PATENTED ARTICLE SHALL CONSTITUTE WORKING OR USING THE PATENT. ALTHOUGH CAPABLE OF BEING WORKED, WITHOUT SATISFACTORY REASON:

Q. Article 31 (f) of the TRIPS Agreement says, “Where the law of a Member allows for other use of the subject matter of a patent without the authorization of the right holder, including use by the government or third parties authorized by the government, the following provisions shall be respected: X X X (f) any such use shall be authorized predominantly for the supply of the domestic market of the Member authorizing such use.” Is there a conflict between this and Sec. 93 as stated above? A. Not answered in class, but there doesn’t seem to be a conflict. Observe, however, the conflict between the TRIPS Agreement and Sec. 100 of the IP Code: “100.4. Use of the subject matter of the license shall be devoted predominantly for the supply of the Philippine market: Provided, That this limitation shall not apply where the grant of the license is based on the ground that the patentee’s manner of exploiting the patent is determined by judicial or administrative process, to be anti-competitive.” SEC. 94. PERIOD FOR FILING A PETITION FOR A COMPULSORY LICENSE. -

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94.1. A

COMPULSORY LICENSE MAY NOT BE APPLIED FOR ON THE GROUND STATED IN SUBSECTION

EXPIRATION OF A PERIOD OF FOUR

(4)

93.5 BEFORE THE (3) YEARS

YEARS FROM THE DATE OF FILING OF THE APPLICATION OR THREE

FROM THE DATE OF THE PATENT WHICHEVER PERIOD EXPIRES LAST.

94.2. A 93.3,

COMPULSORY LICENSE WHICH IS APPLIED FOR ON ANY OF THE GROUNDS STATED IN

SUBSECTIONS 93.2,

AND 93.4 AND SECTION 97 MAY BE APPLIED FOR AT ANY TIME AFTER THE GRANT OF THE PATENT.

SEC. 95. REQUIREMENT TO OBTAIN A LICENSE ON REASONABLE COMMERCIAL TERMS. 95.1. THE LICENSE WILL ONLY BE GRANTED AFTER THE PETITIONER

HAS MADE EFFORTS TO OBTAIN

AUTHORIZATION FROM THE PATENT OWNER ON REASONABLE COMMERCIAL TERMS AND CONDITIONS BUT SUCH EFFORTS HAVE NOT BEEN SUCCESSFUL WITHIN A REASONABLE PERIOD OF TIME.

95.2. THE REQUIREMENT UNDER SUBSECTION 95.1 (A) WHERE

SHALL NOT APPLY IN THE FOLLOWING CASES:

THE PETITION FOR COMPULSORY LICENSE SEEKS TO REMEDY A PRACTICE DETERMINED AFTER

JUDICIAL OR ADMINISTRATIVE PROCESS TO BE ANTI-COMPETITIVE;

(B) IN SITUATIONS OF NATIONAL EMERGENCY OR OTHER CIRCUMSTANCES OF EXTREME URGENCY; (C) IN CASES OF PUBLIC NON-COMMERCIAL USE. 95.3. IN

SITUATIONS OF NATIONAL EMERGENCY OR OTHER CIRCUMSTANCES OF EXTREME URGENCY, THE RIGHT

HOLDER SHALL BE NOTIFIED AS SOON AS REASONABLY PRACTICABLE.

95.4. IN

THE CASE OF PUBLIC NON-COMMERCIAL USE, WHERE THE GOVERNMENT OR CONTRACTOR, WITHOUT

MAKING A PATENT SEARCH, KNOWS OR HAS DEMONSTRABLE GROUNDS TO KNOW THAT A VALID PATENT IS OR WILL BE USED BY OR FOR THE GOVERNMENT, THE RIGHT HOLDER SHALL BE INFORMED PROMPTLY. (N)

SEC. 96. COMPULSORY LICENSING OF PATENTS INVOLVING SEMI-CONDUCTOR TECHNOLOGY. - IN THE CASE OF COMPULSORY LICENSING OF PATENTS INVOLVING SEMI-CONDUCTOR TECHNOLOGY, THE LICENSE MAY ONLY BE GRANTED IN CASE OF PUBLIC NON-COMMERCIAL USE OR TO REMEDY A PRACTICE DETERMINED AFTER JUDICIAL OR ADMINISTRATIVE PROCESS TO BE ANTICOMPETITIVE. (N) SEC. 97. COMPULSORY LICENSE BASED ON INTERDEPENDENCE OF PATENTS. - IF THE INVENTION PROTECTED BY A PATENT, "SECOND PATENT," WITHIN THE COUNTRY CANNOT BE WORKED WITHOUT INFRINGING ANOTHER PATENT, HEREAFTER REFERRED TO AS THE "FIRST PATENT," GRANTED ON A PRIOR APPLICATION OR BENEFITING FROM AN EARLIER PRIORITY, A COMPULSORY LICENSE MAY BE GRANTED TO THE OWNER OF THE SECOND PATENT TO THE EXTENT NECESSARY FOR THE WORKING OF HIS INVENTION, SUBJECT TO THE FOLLOWING CONDITIONS: 97.1. THE INVENTION CLAIMED IN THE SECOND PATENT INVOLVES AN IMPORTANT TECHNICAL ADVANCE OF CONSIDERABLE ECONOMIC SIGNIFICANCE IN RELATION TO THE FIRST PATENT; HEREAFTER REFERRED TO AS THE

97.2. THE OWNER OF THE FIRST PATENT SHALL BE ENTITLED TO A CROSS-LICENSE ON REASONABLE TERMS TO USE THE INVENTION CLAIMED IN THE SECOND PATENT;

97.3. THE

USE AUTHORIZED IN RESPECT OF THE FIRST PATENT SHALL BE NON-ASSIGNABLE EXCEPT WITH THE

ASSIGNMENT OF THE SECOND PATENT; AND

97.4. THE TERMS AND CONDITIONS OF SECTIONS 95, 96

AND 98 TO 100 OF THIS ACT.

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SEC. 98. FORM AND CONTENTS OF PETITION. - THE PETITION FOR COMPULSORY LICENSING MUST BE IN WRITING, VERIFIED BY THE PETITIONER AND ACCOMPANIED BY PAYMENT OF THE REQUIRED FILING FEE. IT SHALL CONTAIN THE NAME AND ADDRESS OF THE PETITIONER AS WELL AS THOSE OF THE RESPONDENTS, THE NUMBER AND DATE OF ISSUE OF THE PATENT IN CONNECTION WITH WHICH COMPULSORY LICENSE IS SOUGHT, THE NAME OF THE PATENTEE, THE TITLE OF THE INVENTION, THE STATUTORY GROUNDS UPON WHICH COMPULSORY LICENSE IS SOUGHT, THE ULTIMATE FACTS CONSTITUTING THE PETITIONER'S CAUSE OF ACTION, AND THE RELIEF PRAYED FOR. (SEC. 34-D, R. A. NO. 165) SEC. 99. NOTICE OF HEARING. 99.1. UPON FILING OF A

PETITION, THE

DIRECTOR

OF

LEGAL AFFAIRS

SHALL FORTHWITH SERVE NOTICE OF THE

FILING THEREOF UPON THE PATENT OWNER AND ALL PERSONS HAVING GRANTS OR LICENSES, OR ANY OTHER RIGHT, TITLE OR INTEREST IN AND TO THE PATENT AND INVENTION COVERED THEREBY AS APPEARS OF RECORD IN THE

OFFICE,

AND OF NOTICE OF THE DATE OF HEARING THEREON, ON SUCH PERSONS AND PETITIONER.

AGENT OR REPRESENTATIVE APPOINTED IN ACCORDANCE WITH

SECTION 33

HEREOF, SHALL BE BOUND TO ACCEPT

SERVICE OF NOTICE OF THE FILING OF THE PETITION WITHIN THE MEANING OF THIS

99.2. IN

EVERY CASE, THE NOTICE SHALL BE PUBLISHED BY THE SAID

CIRCULATION, ONCE A WEEK FOR THREE

(3)

THE RESIDENT

OFFICE

CONSECUTIVE WEEKS AND ONCE IN THE

SECTION.

IN A NEWSPAPER OF GENERAL

IPO GAZETTE AT APPLICANT’S

EXPENSE.

SEC. 100. TERMS AND CONDITIONS OF COMPULSORY LICENSE. - THE BASIC TERMS AND CONDITIONS INCLUDING THE RATE OF ROYALTIES OF A COMPULSORY LICENSE SHALL BE FIXED BY THE DIRECTOR OF LEGAL AFFAIRS SUBJECT TO THE FOLLOWING CONDITIONS: 100.1. THE SCOPE AND DURATION OF SUCH LICENSE SHALL BE LIMITED TO THE PURPOSE FOR WHICH IT WAS AUTHORIZED; 100.2. THE LICENSE SHALL BE NON-EXCLUSIVE; 100.3. THE LICENSE SHALL BE NON-ASSIGNABLE, WHICH THE INVENTION IS BEING EXPLOITED;

EXCEPT WITH THAT PART OF THE ENTERPRISE OR BUSINESS WITH

100.4. USE OF THE SUBJECT MATTER OF THE LICENSE SHALL BE DEVOTED PREDOMINANTLY FOR THE SUPPLY OF THE PHILIPPINE MARKET: PROVIDED, THAT THIS LIMITATION SHALL NOT APPLY WHERE THE GRANT OF THE LICENSE IS BASED ON THE GROUND THAT THE PATENTEE’S MANNER OF EXPLOITING THE PATENT IS DETERMINED BY JUDICIAL OR ADMINISTRATIVE PROCESS, TO BE ANTI-COMPETITIVE. 100.5. THE LICENSE MAY BE TERMINATED UPON PROPER SHOWING THAT CIRCUMSTANCES WHICH LED TO ITS GRANT PROVIDED, THAT ADEQUATE PROTECTION SHALL BE AFFORDED TO THE LEGITIMATE INTEREST OF THE LICENSEE; AND

HAVE CEASED TO EXIST AND ARE UNLIKELY TO RECUR:

100.6. THE PATENTEE SHALL BE PAID ADEQUATE REMUNERATION TAKING INTO ACCOUNT THE ECONOMIC VALUE OF THE GRANT OR AUTHORIZATION, EXCEPT THAT IN CASES WHERE THE LICENSE WAS GRANTED TO REMEDY A PRACTICE WHICH WAS DETERMINED AFTER JUDICIAL OR ADMINISTRATIVE PROCESS, TO BE ANTI-COMPETITIVE, THE NEED TO CORRECT THE ANTI-COMPETITIVE PRACTICE MAY BE TAKEN INTO ACCOUNT IN FIXING THE AMOUNT OF REMUNERATION.

SEC. 101. AMENDMENT, CANCELLATION, SURRENDER OF COMPULSORY LICENSE. 101.1. UPON THE REQUEST OF THE PATENTEE OR THE LICENSEE, THE DIRECTOR OF LEGAL AFFAIRS MAY AMEND THE DECISION GRANTING THE COMPULSORY LICENSE, UPON PROPER SHOWING OF NEW FACTS OR CIRCUMSTANCES JUSTIFYING SUCH AMENDMENT. 101.2. UPON THE REQUEST OF THE PATENTEE,

THE SAID DIRECTOR MAY CANCEL THE COMPULSORY LICENSE:

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(A ) IF

THE GROUND FOR THE GRANT OF THE COMPULSORY LICENSE NO LONGER EXISTS AND IS UNLIKELY

TO RECUR;

(B ) IF

THE LICENSEE HAS NEITHER BEGUN TO SUPPLY THE DOMESTIC MARKET NOR MADE SERIOUS

PREPARATION THEREFOR;

(C) IF THE LICENSEE HAS NOT COMPLIED WITH THE PRESCRIBED TERMS OF THE LICENSE; 101.3. THE LICENSEE MAY SURRENDER THE LICENSE BY A WRITTEN DECLARATION SUBMITTED TO THE OFFICE. 101.4. THE

SAID

DIRECTOR

SHALL CAUSE THE AMENDMENT, SURRENDER, OR CANCELLATION IN THE

REGISTER, IPO

NOTIFY THE PATENTEE, AND/OR THE LICENSEE, AND CAUSE NOTICE THEREOF TO BE PUBLISHED IN THE

GAZETTE. SEC. 102. LICENSEE’S EXEMPTION FROM LIABILITY. - ANY PERSON WHO WORKS A PATENTED PRODUCT, SUBSTANCE AND/OR CHAPTER, SHALL BE FREE FROM ANY LIABILITY FOR INFRINGEMENT: PROVIDED HOWEVER, THAT IN THE CASE OF VOLUNTARY LICENSING, NO COLLUSION WITH THE LICENSOR IS PROVEN. THIS IS PROCESS UNDER A LICENSE GRANTED UNDER THIS

WITHOUT PREJUDICE TO THE RIGHT OF THE RIGHTFUL OWNER OF THE PATENT TO RECOVER FROM THE LICENSOR WHATEVER HE MAY HAVE RECEIVED AS ROYALTIES UNDER THE LICENSE.

(SEC. 35-E, R. A. NO. 165A)

CHAPTER XI ASSIGNMENT AND TRANSMISSION OF RIGHTS SEC. 103. TRANSMISSION OF RIGHTS. 103.1 PATENTS OR APPLICATIONS FOR PATENTS AND INVENTION TO WHICH THEY RELATE, THE SAME WAY AS THE RIGHTS OF OTHER PROPERTY UNDER THE CIVIL CODE.

SHALL BE PROTECTED IN

103.2. INVENTIONS AND ANY RIGHT, TITLE OR INTEREST IN AND TO PATENTS AND INVENTIONS COVERED THEREBY, MAY BE ASSIGNED OR TRANSMITTED BY INHERITANCE OR BEQUEST OR MAY BE THE SUBJECT OF A LICENSE CONTRACT. SEC. 104. ASSIGNMENT OF INVENTIONS. - AN ASSIGNMENT MAY BE OF THE ENTIRE RIGHT, TITLE OR INTEREST IN AND TO THE PATENT AND THE INVENTION COVERED THEREBY, OR OF AN UNDIVIDED SHARE OF THE ENTIRE PATENT AND INVENTION, IN WHICH EVENT THE PARTIES BECOME JOINT OWNERS THEREOF. AN ASSIGNMENT MAY BE LIMITED TO A SPECIFIED TERRITORY. SEC. 105. FORM OF ASSIGNMENT. - THE ASSIGNMENT MUST BE IN WRITING,

ACKNOWLEDGED BEFORE A NOTARY PUBLIC OR

OTHER OFFICER AUTHORIZED TO ADMINISTER OATH OR PERFORM NOTARIAL ACTS, AND CERTIFIED UNDER THE HAND AND OFFICIAL SEAL OF THE NOTARY OR SUCH OTHER OFFICER.

SEC. 106. RECORDING. 106.1. THE OFFICE

SHALL RECORD ASSIGNMENTS, LICENSES AND OTHER INSTRUMENTS RELATING TO THE

TRANSMISSION OF ANY RIGHT, TITLE OR INTEREST IN AND TO INVENTIONS, AND PATENTS OR APPLICATION FOR PATENTS OR INVENTIONS TO WHICH THEY RELATE, WHICH ARE PRESENTED IN DUE FORM TO THE REGISTRATION, IN BOOKS AND RECORDS KEPT FOR THE PURPOSE.

THE

OFFICE

FOR

ORIGINAL DOCUMENTS TOGETHER WITH A

SIGNED DUPLICATE THEREOF SHALL BE FILED, AND THE CONTENTS THEREOF SHOULD BE KEPT CONFIDENTIAL. ORIGINAL IS NOT AVAILABLE, AN AUTHENTICATED COPY THEREOF IN DUPLICATE MAY BE FILED. THE

OFFICE

IF THE UPON RECORDING,

SHALL RETAIN THE DUPLICATE, RETURN THE ORIGINAL OR THE AUTHENTICATED COPY TO THE PARTY

WHO FILED THE SAME AND NOTICE OF THE RECORDING SHALL BE PUBLISHED IN THE

IPO GAZETTE.

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106.2. SUCH

INSTRUMENTS SHALL BE VOID AS AGAINST ANY SUBSEQUENT PURCHASER OR MORTGAGEE FOR

VALUABLE CONSIDERATION AND WITHOUT NOTICE, UNLESS, IT IS SO RECORDED IN THE

(3)

OFFICE,

WITHIN THREE

MONTHS FROM THE DATE OF SAID INSTRUMENT, OR PRIOR TO THE SUBSEQUENT PURCHASE OR MORTGAGE.

SEC. 107. RIGHTS OF JOINT OWNERS. - IF TWO (2) OR MORE PERSONS JOINTLY OWN A PATENT AND THE INVENTION COVERED THEREBY, EITHER BY THE ISSUANCE OF THE PATENT IN THEIR JOINT FAVOR OR BY REASON OF THE ASSIGNMENT OF AN UNDIVIDED SHARE IN THE PATENT AND INVENTION OR BY REASON OF THE SUCCESSION IN TITLE TO SUCH SHARE, EACH OF THE JOINT OWNERS SHALL BE ENTITLED TO PERSONALLY MAKE, USE, SELL, OR IMPORT THE INVENTION FOR HIS OWN PROFIT: PROVIDED, HOWEVER, THAT NEITHER OF THE JOINT OWNERS SHALL BE ENTITLED TO GRANT LICENSES OR TO ASSIGN HIS RIGHT, TITLE OR INTEREST OR PART THEREOF WITHOUT THE CONSENT OF THE OTHER OWNER OR OWNERS, OR WITHOUT PROPORTIONALLY DIVIDING THE PROCEEDS WITH SUCH OTHER OWNER OR OWNERS. CHAPTER XII REGISTRATION OF UTILITY MODELS SEC. 108. APPLICABILITY OF PROVISIONS RELATING TO PATENTS. 108.1. SUBJECT TO SECTION 109, THE PROVISIONS GOVERNING PATENTS SHALL THE REGISTRATION OF UTILITY MODELS.

APPLY, MUTATIS MUTANDIS, TO

108.2. WHERE THE RIGHT TO A PATENT CONFLICTS WITH THE RIGHT TO A UTILITY MODEL REGISTRATION IN THE CASE REFERRED TO IN SECTION 29, THE SAID PROVISION SHALL APPLY AS IF THE WORD PATENT WERE REPLACED BY THE WORDS "PATENT OR UTILITY MODEL REGISTRATION."

SEC. 109. SPECIAL PROVISIONS RELATING TO UTILITY MODELS. 109.1 (A) AN INVENTION QUALIFIES FOR REGISTRATION APPLICABLE. (B) SECTION 21, "PATENTABLE INVENTIONS", AS A CONDITION OF PROTECTION. 109.2. SECTIONS 43

TO

49

AS A UTILITY MODEL IF IT IS NEW AND INDUSTRIALLY

SHALL APPLY EXCEPT THE REFERENCE TO INVENTIVE STEP

SHALL NOT APPLY IN THE CASE OF APPLICATIONS FOR REGISTRATION OF A UTILITY

MODEL.

109.3. A

UTILITY MODEL REGISTRATION SHALL EXPIRE, WITHOUT ANY POSSIBILITY OF RENEWAL, AT THE END OF

THE SEVENTH YEAR AFTER THE DATE OF THE FILING OF THE APPLICATION.

109.4. IN PROCEEDINGS UNDER SECTIONS 61

TO

64,

THE UTILITY MODEL REGISTRATION SHALL BE CANCELED ON

THE FOLLOWING GROUNDS:

(A) THAT

THE CLAIMED INVENTION DOES NOT QUALIFY FOR REGISTRATION AS A UTILITY MODEL AND

DOES NOT MEET THE REQUIREMENTS OF REGISTRABILITY, IN PARTICULAR HAVING REGARD TO

SUBSECTION 109.1

AND SECTIONS 22,

23, 24

AND 27;

(B) THAT THE DESCRIPTION AND THE CLAIMS DO NOT COMPLY WITH THE PRESCRIBED REQUIREMENTS; (C) THAT

ANY DRAWING WHICH IS NECESSARY FOR THE UNDERSTANDING OF THE INVENTION HAS NOT

BEEN FURNISHED;

(D) THAT THE OWNER OF THE UTILITY MODEL REGISTRATION IS NOT THE INVENTOR OR HIS SUCCESSOR IN TITLE.

SEC. 110. CONVERSION OF PATENT APPLICATIONS OR APPLICATIONS FOR UTILITY MODEL REGISTRATION. -

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110.1. AT

ANY TIME BEFORE THE GRANT OR REFUSAL OF A PATENT, AN APPLICANT FOR A PATENT MAY, UPON

PAYMENT OF THE PRESCRIBED FEE, CONVERT HIS APPLICATION INTO AN APPLICATION FOR REGISTRATION OF A UTILITY MODEL, WHICH SHALL BE ACCORDED THE FILING DATE OF THE INITIAL APPLICATION.

AN APPLICATION MAY

BE CONVERTED ONLY ONCE.

110.2. AT

ANY TIME BEFORE THE GRANT OR REFUSAL OF A UTILITY MODEL REGISTRATION, AN APPLICANT FOR A

UTILITY MODEL REGISTRATION MAY, UPON PAYMENT OF THE PRESCRIBED FEE, CONVERT HIS APPLICATION INTO A PATENT APPLICATION, WHICH SHALL BE ACCORDED THE FILING DATE OF THE INITIAL APPLICATION.

SEC. 111. PROHIBITION AGAINST FILING OF PARALLEL APPLICATIONS. - AN APPLICANT MAY NOT FILE TWO (2) APPLICATIONS FOR THE SAME SUBJECT, ONE FOR UTILITY MODEL REGISTRATION AND THE OTHER FOR THE GRANT OF A PATENT WHETHER SIMULTANEOUSLY OR CONSECUTIVELY. Q. Do you have notes for Utility Models? A. Yes. They are placed under Industrial Designs. CHAPTER XIII INDUSTRIAL DESIGN AND LAYOUT DESIGNS (TOPOGRAPHIES) OF INTEGRATED CIRCUITS (NOTE: THIS ENTIRE CHAPTER WAS AMENDED BY REPUBLIC ACT NO. 9150 WHICH WAS APPROVED ON AUGUST 06, 2001) REPUBLIC ACT NO. 9150 AN ACT PROVIDING FOR THE PROTECTION OF LAYOUT-DESIGNS (TOPOGRAPHIES) OF INTEGRATED CIRCUITS, AMENDING FOR THE PURPOSE CERTAIN SECTIONS OF REPUBLIC ACT NO. 8293, OTHERWISE KNOWN AS THE INTELLECTUAL PROPERTY CODE OF THE PHILIPPINES AND FOR OTHER PURPOSES.

SECTION 1. SECTIONS 112, 113, 114, 116, 117, 118, 119

AND

120

UNDER

CHAPTER XIIL OF R. A. NO. 8293 ARE HEREBY

AMENDED TO READ AS FOLLOWS:

"CHAPTER XIII "INDUSTRIAL DESIGN AND LAYOUT DESIGNS (TOPOGRAPHIES) OF INTEGRATED CIRCUITS "SEC. 112. DEFINITION OF TERMS:" "1. AN INDUSTRIAL DESIGN

IS ANY COMPOSITION OF LINES OR COLORS OR ANY THREE-DIMENSIONAL FORM, WHETHER OR

NOT ASSOCIATED WITH LINES OR COLORS:

PROVIDED, THAT SUCH COMPOSITION OR FORM GIVES A SPECIAL APPEARANCE TO

AND CAN SERVE AS PATTERN FOR AN INDUSTRIAL PRODUCT OR HANDICRAFT;

"2. INTEGRATED CIRCUIT MEANS A PRODUCT, IN ITS FINAL FORM, OR AN INTERMEDIATE FORM, IN WHICH THE ELEMENTS, AT LEAST ONE OF WHICH IS AN ACTIVE ELEMENT AND SOME OR ALL OF THE INTERCONNECTIONS ARE INTEGRALLY FORMED IN AND/OR ON A PIECE OF MATERIAL, AND WHICH IS INTENDED TO PERFORM AN ELECTRONIC FUNCTION; AND

"3. LAYOUT-DESIGN IS SYNONYMOUS WITH 'TOPOGRAPHY' AND MEANS THE THREE-DIMENSIONAL DISPOSITION, HOWEVER EXPRESSED, OF THE ELEMENTS, AT LEAST ONE OF WHICH IS AN ACTIVE ELEMENT, AND OF SOME OR ALL OF THE INTERCONNECTIONS OF AN INTEGRATED CIRCUIT, OR SUCH A THREE-DIMENSIONAL DISPOSITION PREPARED FOR AN INTEGRATED CIRCUIT INTENDED FOR MANUFACTURE." CHAN ROBLES VIRTUAL LAW LIBRARY "SEC. 113. SUBSTANTIVE CONDITIONS/OR PROTECTION. - 113.1. ONLY ORNAMENTAL SHALL BENEFIT FROM PROTECTION UNDER THIS ACT.

INDUSTRIAL DESIGNS THAT ARE NEW OR

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"113.2. INDUSTRIAL

DESIGNS DICTATED ESSENTIALLY BY TECHNICAL OR FUNCTIONAL CONSIDERATIONS TO OBTAIN A

TECHNICAL RESULT OR THOSE THAT ARE CONTRARY TO PUBLIC ORDER, HEALTH OR MORALS SHALL NOT BE PROTECTED.

Q. Can you describe an industrial design? A. An Industrial Design (ID) is something attractive to the consumer, e.g. design of a chair. Q. Can the design of the chair be covered by copyright or patent? A. It can be covered by a copyright (but remember the test in copyright, that if the design is more functional than artistic, then it is no longer copyrightable, since it is no longer considered “creative expression”). But it cannot be covered by a patent. Q. Can you distinguish the protection granted by copyright and ID? A. See chart that follows:

Subject matter of protection Formalities

Term of protection

Copyright Covers design No registration required, protection is acquired from the moment of creation. Life of the creator + 50 years

Industrial Designs Covers design Requires registration

5 years, renewable for another 5 years (so basically, 10 years)

Q. Which is better? A. Sapalo says, an ID is better, since you have a document to hold on to, so the protection granted is easier to enforce. Some judges may still be under the erroneous impression that copyright requires registration. Q. Can a new Camry model be protected by an ID? A. Yes. All industrial products may be covered as long as it is original. Q. Have you eaten instant noodles in cups? Notice the ridges which aren’t exactly necessary, but make the holding of the cup possible because it defuses the heat? Can this be subject to patent? ID? A. Not to patent. Patent requires the thing to be new, be useful, and have industrial applicability. The ridge isn’t really useful, just makes the thing look nicer and more convenient. Q. A invents an eraser. B invents a pencil. C places the eraser on top of the pencil. Can this be patentable? A. No. but it can be covered by an ID. Q. Something is not aesthetic but it is useful. How do you protect this? A. By registering it as a utility model (UM). Q. Please compare UM and ID. A. UM – new & USEFUL ID – new & ornamental Q. What is the difference between the registration of a patent and a UM/ID? A. A patent requires a substantive examination for novelty, and a UM/ID application does not. Also, a patent application is usually processed for 2-3 years. A UM/ID application’s processing time is around 6 months. Q. So you may never have a substantive examination in UM/ID applications? A. Yes you may request for a search, but this is voluntary, to show that there is no risk to the licensing of the UM/ID to your principal.

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Q. Who usually avails of UM/ID? A. Usually, local inventors, since it is cheaper and faster, but it is not very safe, since the IPO does not officially check for prior art. Q. You file for UM, and get a registration after 6 months. After this, you file for a patent. Allowed? A. No. This is prior art already, and it would fall under the prohibition of Sec. 111, which proscribes against simultaneous or consecutive UM/ID + patent application. Q. What if you file and get a UM, after which you file for ID? A. It is no longer under the proscription of Sec. 111. However, there would be no more novelty, since it is already prior art. Then again, the IPO does not conduct a substantive check. It appears that the law is not very clear on this. "113.3. ONLY LAYOUT -DESIGNS OF INTEGRATED CIRCUITS THAT ARE ORIGINAL SHALL BENEFIT FROM PROTECTION UNDER THIS ACT. A LAYOUT-DESIGN SHALL BE CONSIDERED ORIGINAL IF IT IS THE RESULT OF ITS CREATOR'S OWN INTELLECTUAL EFFORT AND IS NOT COMMONPLACE AMONG CREATORS OF LAYOUT-DESIGNS AND MANUFACTURERS OF INTEGRATED CIRCUITS AT THE TIME OF ITS CREATION. "113.4. A

LAYOUT-DESIGN CONSISTING OF A COMBINATION OF ELEMENTS AND INTERCONNECTIONS THAT ARE

COMMONPLACE SHALL BE PROTECTED ONLY IF THE COMBINATION, TAKEN AS A WHOLE, IS ORIGINAL."

"SEC. 114. CONTENTS OF THE APPLICATION. - 114.1. EVERY OR LAYOUT-DESIGN SHALL CONTAIN: "(A) A

APPLICATION FOR REGISTRATION OF AN INDUSTRIAL DESIGN

REQUEST FOR REGISTRATION OF THE INDUSTRIAL DESIGN OR LAYOUT-DESIGN;

"(B) INFORMATION IDENTIFYING THE APPLICANT; "(C) AN INDICATION OF THE KIND LAYOUT-DESIGN SHALL BE APPLIED; "(D) A

OF ARTICLE OF MANUFACTURE OR HANDICRAFT TO WHICH THE INDUSTRIAL DESIGN OR

REPRESENTATION OF THE ARTICLE OF MANUFACTURE OR HANDICRAFT BY WAY OF DRAWINGS, PHOTOGRAPHS OR

ADEQUATE GRAPHIC REPRESENTATION OF THE INDUSTRIAL DESIGN OR OF THE LAYOUT-DESIGN AS APPLIED TO THE ARTICLE OF MANUFACTURE OR HANDICRAFT WHICH CLEARLY AND FULLY DISCLOSES THOSE FEATURES FOR WHICH PROTECTION IS CLAIMED; AND CHAN ROBLES VIRTUAL LAW LIBRARY

"(E) THE NAME AND ADDRESS OF THE CREATOR,

OR WHERE THE APPLICANT IS NOT THE CREATOR, A STATEMENT INDICATING

THE ORIGIN OF THE RIGHT TO THE INDUSTRIAL DESIGN OR LAYOUT-DESIGN REGISTRATION.

"114.2. THE

APPLICATION MAY BE ACCOMPANIED BY A SPECIMEN OF THE ARTICLE EMBODYING THE INDUSTRIAL DESIGN OR

LAYOUT-DESIGN AND SHALL BE SUBJECT TO THE PAYMENT OF THE PRESCRIBED FEE."

SEC. 115. SEVERAL INDUSTRIAL DESIGNS IN ONE APPLICATION. – TWO (2) OR MORE INDUSTRIAL DESIGNS MAY BE THE SUBJECT OF THE SAME APPLICATION, PROVIDED, THAT THEY RELATE TO THE SAME SUB-CLASS OF THE INTERNATIONAL CLASSIFICATION OR TO THE SAME SET OR COMPOSITION OF ARTICLES. (N) "SEC. 116. EXAMINATION. - 116.1. THE OFFICE

SHALL ACCORD AS THE FILING DATE THE DATE OF RECEIPT OF THE

APPLICATION CONTAINING INDICATIONS ALLOWING THE IDENTITY OF THE APPLICANT TO BE ESTABLISHED AND A REPRESENTATION OF THE ARTICLE EMBODYING THE INDUSTRIAL DESIGN OR THE LAYOUT REPRESENTATION THEREOF.

-DESIGN

OR A PICTORIAL

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"116.2. IF THE APPLICATION DOES NOT MEET THESE REQUIREMENTS, THE FILING DATE SHOULD BE THAT DATE WHEN ALL THE ELEMENTS SPECIFIED IN SEC. 114 ARE FILED OR THE MISTAKES CORRECTED. OTHERWISE, IF THE REQUIREMENTS ARE NOT COMPLIED WITHIN THE PRESCRIBED PERIOD, THE APPLICATION SHALL BE CONSIDERED WITHDRAWN. "116.3. AFTER THE APPLICATION HAS BEEN ACCORDED A FILING DATE AND THE REQUIRED FEES PAID ON TIME, THE APPLICANT SHALL COMPLY WITH THE REQUIREMENTS OF SEC. 114 WITHIN THE PRESCRIBED PERIOD, OTHERWISE THE APPLICATION SHALL BE CONSIDERED WITHDRAWN. "116.4. THE OFFICE

SHALL EXAMINE WHETHER THE INDUSTRIAL DESIGN OR LAYOUT-DESIGN COMPLIES WITH

REQUIREMENTS OF SEC.

112 (DEFINITIONS)

AND SEC.

113 (SUBSTANTIVE CONDITIONS FOR PROTECTION)."

"SEC. 117, REGISTRATION. - 117.1. WHERE THE OFFICE FINDS THAT THE CONDITIONS REFERRED TO IN SEC. 113 ARE FULFILLED, IT SHALL ORDER THAT REGISTRATION BE EFFECTED IN THE INDUSTRIAL DESIGN OR LAYOUT-DESIGN REGISTER AND CAUSE THE ISSUANCE OF AN INDUSTRIAL DESIGN OR LAYOUT-DESIGN CERTIFICATE OF REGISTRATION; OTHERWISE, IT SHALL REFUSE THE APPLICATION. " 117.2. THE FORM AND CONTENTS OF AN INDUSTRIAL DESIGN OR LAYOUT-DESIGN CERTIFICATE SHALL BE ESTABLISHED BY THE REGISTRATIONS: PROVIDED, THAT THE NAME AND ADDRESS OF THE CREATOR SHALL BE MENTIONED IN EVERY CASE. " 117.3. REGISTRATION SHALL BE PUBLISHED IN THE FORM AND WITHIN THE PERIOD FIXED BY THE REGULATIONS. " 117.4. THE OFFICE SHALL RECORD IN THE REGISTER ANY CHANGE IN THE IDENTITY OF THE PROPRIETOR OF THE INDUSTRIAL A FEE SHALL BE PAID, WITH THE REQUEST TO RECORD THE CHANGE IN THE IDENTITY OF THE PROPRIETOR, IF THE FEE IS NOT PAID, THE REQUEST SHALL BE DEEMED NOT TO HAVE BEEN FILED. IN SUCH CASE, THE FORMER PROPRIETOR AND THE FORMER REPRESENTATIVE SHALL REMAIN SUBJECT TO THE RIGHTS AND OBLIGATIONS AS PROVIDED IN THIS ACT.

DESIGN OR LAYOUT DESIGN OR HIS REPRESENTATIVE, IF PROOF THEREOF IS FURNISHED TO IT.

" 117.5. ANYONE

MAY INSPECT THE

REGISTER

AND THE FILES OF REGISTERED INDUSTRIAL DESIGNS OR LAYOUT-DESIGNS

INCLUDING FILES OF CANCELLATION PROCEEDINGS." CHAN ROBLES VIRTUAL LAW LIBRARY

"SEC. 118. THE TERM OF INDUSTRIAL DESIGN OR LAYOUT-DESIGN REGISTRATION. - 118.1. THE REGISTRATION (5) YEARS FROM THE FILING DATE OF THE APPLICATION.

OF AN

INDUSTRIAL DESIGN SHALL BE FOR A PERIOD OF FIVE

" 118.2. THE

REGISTRATION OF AN INDUSTRIAL DESIGN MAY BE RENEWED FOR NOT MORE THAN TWO

(2)

CONSECUTIVE

PERIODS OF FIVE (5) YEARS EACH, BY PAYING THE RENEWAL FEE.

"118.3. THE

RENEWAL FEE SHALL BE PAID WITHIN TWELVE

REGISTRATION.

HOWEVER,

A GRACE PERIOD OF SIX

(6)

(12)

MONTHS PRECEDING THE EXPIRATION OF THE PERIOD OF

MONTHS SHALL BE GRANTED FOR PAYMENT OF THE FEES AFTER SUCH

EXPIRATION, UPON PAYMENT OF A SURCHARGE.

"118.4. THE REGULATIONS

SHALL FIX THE AMOUNT OF RENEWAL FEE, THE SURCHARGE AND OTHER REQUIREMENTS

REGARDING THE RECORDING OF RENEWALS OF REGISTRATION.

" 118.5. REGISTRATION OF A

LAYOUT-DESIGN SHALL BE VALID FOR A PERIOD OFTEN

(10)

YEARS, WITHOUT RENEWAL, AND

SUCH VALIDITY TO BE COUNTED FROM THE DATE OF COMMENCEMENT OF THE PROTECTION ACCORDED TO THE LAYOUT-DESIGN.

THE PROTECTION OF A LAYOUT-DESIGN UNDER THIS ACT SHALL COMMENCE: "A) ON THE DATE OF THE FIRST COMMERCIAL EXPLOITATION, ANYWHERE IN THE WORLD, OF THE LAYOUT-DESIGN BY OR WITH PROVIDED, THAT AN APPLICATION FOR REGISTRATION IS FILED WITH THE INTELLECTUAL PROPERTY OFFICE WITHIN TWO (2) YEARS FROM SUCH DATE OF FIRST COMMERCIAL EXPLOITATION; OR THE CONSENT OF THE RIGHT HOLDER:

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" B)

ON THE FILING DATE ACCORDED TO THE APPLICATION FOR THE REGISTRATION OF THE LAYOUT-DESIGN IF THE LAYOUT-

DESIGN HAS NOT BEEN PREVIOUSLY EXPLOITED COMMERCIALLY ANYWHERE IN THE WORLD."

"SEC. 119. APPLICATION OF OTHER SECTIONS AND CHAPTERS. - 119.1. THE

FOLLOWING PROVISIONS RELATING TO

PATENTS SHALL APPLY MUTATIS MUTANDIS TO AN INDUSTRIAL DESIGN REGISTRATION.

"SECTION 21. - NOVELTY; "SECTION 24 - PRIOR ART: PROVIDED, THAT THE DISCLOSURE IS CONTAINED IN PRINTED DOCUMENTS OR IN ANY TANGIBLE FORM; "SECTION 25 - NON PREJUDICIAL DISCLOSURE; "SECTION 28 - RIGHT TO A PATENT; "SECTION 29 - FIRST TO FILE RULE; "SECTION 30 - INVENTIONS CREATED PURSUANT TO A COMMISSION; "SECTION 31 - RIGHT OF PRIORITY: PROVIDED, THAT THE APPLICATION FOR INDUSTRIAL DESIGN SHALL BE FILED WITHIN SIX (6) MONTHS FROM THE EARLIEST FILING DATE OF THE CORRESPONDING FOREIGN APPLICATION; "SECTION 33 - APPOINTMENT OF AGENT OR REPRESENTATIVE; "SECTION 51 - REFUSAL OF THE APPLICATION; CHAN ROBLES VIRTUAL LAW LIBRARY "SECTION 56 TO 60 - SURRENDER, CORRECTION OF AND CHANGES IN PATENT; CHAPTER VII - REMEDIES OF A PERSON WITH A RIGHT TO PATENT; CHAPTER VIII - RIGHTS OF PATENTEES AND INFRINGEMENT OF PATENTS; AND "CHAPTER XI - ASSIGNMENT AND TRANSMISSION OF RIGHTS "119.2. IF

THE ESSENTIAL ELEMENTS OF AN INDUSTRIAL DESIGN WHICH IS THE SUBJECT OF AN APPLICATION HAVE BEEN

OBTAINED FROM THE CREATION OF ANOTHER PERSON WITHOUT HIS CONSENT, PROTECTION UNDER THIS CHAPTER CANNOT BE INVOKED AGAINST THE INJURED PARTY.

"119.3. THE

FOLLOWING PROVISIONS RELATING TO PATENTS SHALL APPLY MUTATIS MUTANDIS TO A LAYOUT -DESIGN OF

INTEGRATED CIRCUITS REGISTRATION:

"SECTION 28 - RIGHT TO A PATENT; "SECTION 29 - FIRST TO FILE RULE; "SECTION 30 - INVENTIONS CREATED PURSUANT TO A COMMISSION; "SECTION 33 - APPOINTMENT OF AGENT OR REPRESENTATIVE; "SECTION 56 - SURRENDER OF PATENT; "SECTION 57 - CORRECTION OF MISTAKES OF THE OFFICE; "SECTION 58 - CORRECTION OF MISTAKES IN THE APPLICATION; "SECTION 59 - CHANGES IN PATENTS; "SECTION 60 - FORM AND PUBLICATION OF AMENDMENT; "CHAPTER VII - REMEDIES OF A PERSON WITH A RIGHT TO PATENT; "CHAPTER VIII - RIGHTS OF PATENTEES AND INFRINGEMENT OF PATENTS: PROVIDED, THAT THE LAYOUT-DESIGN RIGHTS AND LIMITATION OF LAYOUT-DESIGN RIGHTS PROVIDED HEREUNDER SHALL GOVERN: "CHAPTER X - COMPULSORY LICENSING; CHAN ROBLES VIRTUAL LAW LIBRARY "CHAPTER XI - ASSIGNMENT AND TRANSMISSION OF RIGHTS "119.4. RIGHTS CONFERRED TO THE OWNER OF A LAYOUT-DESIGN REGISTRATION. - THE REGISTRATION SHALL ENJOY THE FOLLOWING RIGHTS: "(1)

OWNER OF A LAYOUT-DESIGN

TO REPRODUCE, WHETHER BY INCORPORATION IN AN INTEGRATED CIRCUIT OR OTHERWISE, THE REGISTERED LAYOUT-

DESIGN IN ITS ENTIRETY OR ANY PART THEREOF, EXCEPT THE ACT OF REPRODUCING ANY PART THAT DOES NOT COMPLY WITH THE REQUIREMENT OF ORIGINALITY; AND

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"(2)

TO SELL OR OTHERWISE DISTRIBUTE FOR COMMERCIAL PURPOSES THE REGISTERED LAYOUT DESIGN, AN ARTICLE OR AN

INTEGRATED CIRCUIT IN WHICH THE REGISTERED LAYOUT-DESIGN IS INCORPORATED.

"119.5. LIMITATIONS OF LAYOUT RIGHTS. - THE OWNER OF A LAYOUT DESIGN HAS NO RIGHT TO PREVENT THIRD PARTIES FROM REPRODUCING, SELLING OR OTHERWISE DISTRIBUTING FOR COMMERCIAL PURPOSES THE REGISTERED LAYOUT-DESIGN IN THE FOLLOWING CIRCUMSTANCES: "(1) REPRODUCTION OF THE REGISTERED LAYOUT-DESIGN FOR PRIVATE PURPOSES OR FOR THE SOLE PURPOSE OF EVALUATION, ANALYSIS, RESEARCH OR TEACHING; "(2) WHERE

THE ACT IS PERFORMED IN RESPECT OF A LAYOUT-DESIGN CREATED ON THE BASIS OF SUCH ANALYSIS OR

EVALUATION AND WHICH IS ITSELF ORIGINAL IN THE MEANING AS PROVIDED HEREIN;

"(3) WHERE

THE ACT IS PERFORMED IN RESPECT OF A REGISTERED LAY-OUT-DESIGN, OR IN RESPECT OF AN INTEGRATED

CIRCUIT IN WHICH SUCH A LAYOUT-DESIGN IS INCORPORATED, THAT HAS BEEN PUT ON THE MARKET BY OR WITH THE CONSENT OF THE RIGHT HOLDER;

"(4) IN

RESPECT OF AN INTEGRATED CIRCUIT WHERE THE PERSON PERFORMING OR ORDERING SUCH AN ACT DID NOT KNOW

AND HAD NO REASONABLE GROUND TO KNOW WHEN ACQUIRING THE INTEGRATED CIRCUIT OR THE ARTICLE INCORPORATING SUCH AN INTEGRATED CIRCUIT, THAT IT INCORPORATED AN UNLAWFULLY REPRODUCED LAYOUT-DESIGN:

HOWEVER,

THAT

PROVIDED,

AFTER THE TIME THAT SUCH PERSON HAS RECEIVED SUFFICIENT NOTICE THAT THE LAYOUT-DESIGN WAS

UNLAWFULLY REPRODUCED, THAT PERSON MAY PERFORM ANY OF THE SAID ACTS ONLY WITH RESPECT TO THE STOCK ON HAND

OR ORDERED BEFORE SUCH TIME AND SHALL BE LIABLE TO PAY TO THE RIGHT HOLDER A SUM EQUIVALENT TO AT LEAST

5%

OF

NET SALES OR SUCH OTHER REASONABLE ROYALTY AS WOULD BE PAYABLE UNDER A FREELY NEGOTIATED LICENSE IN RESPECT OF SUCH LAYOUT-DESIGN; OR CHAN ROBLES VIRTUAL LAW LIBRARY

"(5) WHERE

THE ACT IS PERFORMED IN RESPECT OF AN IDENTICAL LAYOUT-DESIGN WHICH IS ORIGINAL AND HAS BEEN

CREATED INDEPENDENTLY BY A THIRD PARTY."

"SEC. 120. CANCELLATION OF DESIGN REGISTRATION. - 120.1. AT ANY TIME DURING THE TERM OF THE INDUSTRIAL DESIGN REGISTRATION, ANY PERSON UPON PAYMENT OF THE REQUIRED FEE, MAY PETITION THE DIRECTOR OF LEGAL AFFAIRS TO CANCEL THE INDUSTRIAL DESIGN ON ANY OF THE FOLLOWING GROUNDS: "(A) IF THE SUBJECT MATTER OF THE INDUSTRIAL DESIGN IS NOT REGISTERABLE WITHIN THE TERMS OF SECTIONS 112 113; "(B) IF THE SUBJECT MATTER IS NOT NEW; "(C) IF

AND

OR

THE SUBJECT MATTER OF THE INDUSTRIAL DESIGN EXTENDS BEYOND THE CONTENT OF THE APPLICATION AS

ORIGINALLY FILED.

"120.2. WHERE

THE GROUNDS FOR CANCELLATION RELATE TO A PART OF THE INDUSTRIAL DESIGN, CANCELLATION MAY BE

EFFECTED TO SUCH EXTENT ONLY.

THE

RESTRICTION MAY BE EFFECTED IN THE FORM OF AN ALTERATION OF THE EFFECTED

FEATURES OF THE DESIGN.

"120.3. GROUNDS FOR CANCELLATION OF LAYOUT-DESIGN OF INTEGRATED CIRCUITS.- ANY

PETITION THAT THE REGISTRATION OF A LAYOUT-DESIGN BE CANCELED ON THE GROUND THAT:

"(I)

THE LAYOUT-DESIGN IS NOT PROTECTABLE UNDER THIS

"(II)

ACT;

THE RIGHT HOLDER IS NOT ENTITLED TO PROTECTION UNDER THIS

ACT;

OR

INTERESTED PERSON MAY

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"(III)

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, THE CORRESPONDING PART OF THE REGISTRATION SHALL BE CANCELED. "ANY

ONLY

CANCELED LAYOUT-DESIGN REGISTRATION OR PART THEREOF, SHALL BE REGARDED AS NULL AND VOID FROM THE

BEGINNING AND MAY BE EXPUNGED FROM THE RECORDS OF THE

INTELLECTUAL PROPERTY OFFICE. REFERENCE IPO GAZETTE."

TO ALL

CANCELED LAYOUT-DESIGN REGISTRATION SHALL BE PUBLISHED IN THE

SECTION 2. IMPLEMENTING RULES AND REGULATIONS. - THE INTELLECTUAL PROPERTY OFFICE MAY ISSUE REGULATIONS PRESCRIBING DETAILS FOR THE IMPLEMENTATION OF THIS LAW. THE REGULATIONS MAY, IN PARTICULAR, PROVIDE FOR THE PAYMENT OF FEES IN CONNECTION WITH APPLICATIONS FOR THE REGISTRATION OF LAYOUT-DESIGNS OF INTEGRATED CIRCUITS AND MATTERS RELATED THERETO, INCLUDING ADMINISTRATIVE INSTRUCTIONS RELATING TO THE PROCEDURES AND OTHER FUNCTIONS OF THE RESPONSIBLE UNTIL DULY DESIGNATED BY THE DIRECTOR GENERAL. SECTION 3. APPLICABILITY. - THE PROVISIONS OF THIS ACT SHALL APPLY TO LAYOUT-DESIGNS OF INTEGRATED CIRCUITS THAT WERE COMMERCIALLY EXPLOITED ANYWHERE IN THE WORLD FROM AND AFTER JANUARY 1998 PROVIDED THEY MEET THE CONDITIONS FOR PROTECTION UNDER THIS ACT.

REPUBLIC ACT. NO. 9168 PHILIPPINE PLANT VARIETY PROTECTION ACT

OF

2002

Q. Did Atty. Sapalo mention some important things that we ought to know about this law? A. Yes. See the following questions. Q. What are the conditions for registrability/for grant of certificate of protection? A. Sec. 4. The Certificate of Plant Variety Protection shall be granted for varieties that are: a. New – has not been sold, offered for sale or otherwise disposed of to others for purpose of exploitation of the variety b. Distinct – clearly distinguishable from any commonly known variety c. Uniform – sufficiently uniform in its relevant characteristics d. Stable – relevant characteristics remain unchanged after repeated propagation Q. Where shall the application be filed? A. It shall be filed in the National Plant Variety Protection Board. Q. Where shall the action for infringement be filed? A. Sec. 48. Any holder may petition the proper RTC for infringement of his plant variety protection as defined in this Act. (now the Plant Variety Court) Q. What is the term of protection? A. Sec. 33. For trees and vines, 25 years from date of grant of certificate; all others, 20 years from said date. Q. Is exporting and importing a right granted under the law? A. Sec. 36. Yes. It is expressly granted under the law. Q. Are there exceptions to plant variety protections, when the certificate shall not be granted? A. Sec. 43. Yes. The Certificate of Plant Variety Protection shall not extend to: a) Acts for noncommercial purposes b) Acts done for experimental purposes

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c) d)

Acts done for the purpose of breeding other varieties, except when Sec. 39 & 40 apply; and The traditional right of small farmers to save, use, exchange, share or sell their farm produce of a variety protected under this Act, except when a sale is for the purpose of reproduction under a commercial marketing agreement.

EXEUNT