PATENTS: DIGESTS

MANZANO v CA278 SCRA 688 (1997)

The primary purpose of the patent system is not the reward of the individual but the advancement of the arts and sciences. The function of a patent is to add to the sum of useful knowledge and one of the purposes of the patent system is to encourage dissemination of information concerning discoveries and inventions.

FACTS:Angelita Manzano filed PPO an action for the

cancellation of Letters Patent for a gas burner registered in the name of respondent Melecia Madolaria who subsequently assigned the letters patent to New United Foundry and Manufacturing Corporation (UNITED FOUNDRY, for brevity). Petitioner alleged that (a) the utility model covered by the letters patent, in this case, an LPG gas burner, was not inventive, new or useful; (b) the specification of the letters patent did not comply with the requirements of Sec. 14, RA No. 165, as amended; (c) respondent Melecia Madolaria was not the original, true and actual inventor nor did she derive her rights from the original, true and actual inventor of the utility model covered by the letters patent; and, (d) the letters patent was secured by means of fraud or misrepresentation.

Testifying for herself petitioner narrated that her husband Ong Bun Tua worked as a helper in the UNITED FOUNDRY where respondent Melecia Madolaria used to be affiliated with from 1965 to 1970; that Ong helped in the casting of an LPG burner which was the same utility model of a burner and that after her husband’s separation from the shop she organized Besco Metal Manufacturing (BESCO METAL, for brevity) for the casting of LPG burners one of which had the configuration, form and component parts similar to those being manufactured by UNITED FOUNDRY.

Petitioner presented two (2) other witnesses, namely, her husband Ong Bun Tua and Fidel Francisco.

Private respondent, on the other hand, presented only one witness, Rolando Madolaria, who testified, among others, that he was the General Supervisor of the UNITED FOUNDRY.

Director of Patents Cesar C. Sandiego denied the petition for cancellation and holding that the evidence of petitioner was not able to establish convincingly that the patented utility model of private respondent was anticipated.

Petitioner elevated the decision of the Director of Patents to the Court of Appeals which affirmed the decision of the Director of Patents. Hence, this petition for review on certiorari.

ISSUE: Whether the dismissal is proper where the patent applied for has no substantial difference between the model to be patented and those sold by petitioner.

HELD:The element of novelty is an essential requisite of the patentability of an invention or discovery. If a device or process has been known or used by others prior to its invention or discovery by the applicant, an application for a patent therefor should be denied; and if the application has been granted, the court, in a judicial proceeding in which the validity of the patent is drawn in question, will hold it void and ineffective. It has been repeatedly held that an invention must possess the essential elements of novelty, originality and precedence, and for the patentee to be entitled to the protection the invention must be new to the world.

However, The validity of the patent issued by the Philippine Patent Office in favor of private respondent and the question over the inventiveness, novelty and usefulness of the improved model of the LPG burner are matters which are better determined by the Patent Office. The technical staff of the Philippine Patent Office composed of experts in their field has by the issuance of the patent in question accepted private respondent’s model of gas burner as a discovery. There is a presumption that the Office has correctly determined the patentability of the model and such action must not be interfered with in the absence of competent evidence to the contrary.

The rule is settled that the findings of fact of the Director of Patents, especially when affirmed by the Court of Appeals, are conclusive on this Court when supported by substantial evidence. Petitioner has failed to show compelling grounds for a reversal of the findings and conclusions of the Patent Office and the Court of Appeals. Petition DISMISSED.

MAGUAN v CA146 SCRA 107 (1986)

FACTS:Petitioner is doing business under the firm

name and style of SWAN MANUFACTURING" while private respondent is likewise doing business under the firm name and style of "SUSANA LUCHAN POWDER PUFF MANUFACTURING.” And holder

petitioner informed private respondent that the powder puffs the latter is manufacturing and selling to various enterprises particularly those in the cosmetics industry, resemble Identical or substantially Identical powder puffs of which the former is a patent holder under Registration Certification Nos. Extension UM-109,

SOTELO, MS | 1

PATENTS: DIGESTS

Extension UM-110 and Utility Model No. 1184; petitioner explained such production and sale constitute infringement of said patents and therefore its immediate discontinuance is demanded, otherwise it will be compelled to take judicial action

Private respondent replied stating that her products are different and countered that petitioner's patents are void because the utility models applied for were not new and patentable and the person to whom the patents were issued was not the true and actual author nor were her rights derived from such author.

Petitioner filed a complaint for damages with injunction and preliminary injunction against private respondent with the then Court of First Instance of Rizal

The trial court issued an Order granting the preliminary injunction prayed for by petitioner. Consequently, the corresponding writ was subsequently issued.

In challenging these Orders private respondent filed a petition for certiorari with the respondent court but was denied. Hence this petition.

ISSUE:(1) Whether or not in an action for infringement the Court a quo had jurisdiction to determine the invalidity of the patents at issue which invalidity was still pending consideration in the patent office. (2) Whether or not the Court a quo committed grave abuse of discretion in the issuance of a writ of preliminary injunction.(3) Whether or not certiorari is the proper remedy.

HELD:1) The first issue has been laid to rest in a number of cases where the Court ruled that "When a patent is sought to be enforced, the questions of invention, novelty or prior use, and each of them, are open to judicial examination."

Under the present Patent Law, there is even less reason to doubt that the trial court has jurisdiction to declare the patents in question invalid. A patentee shall have the exclusive right to make, use and sell the patented article or product and the making, using, or selling by any person without the authorization of the patentee constitutes infringement of the patent (Sec. 37, R.A. 165). Any patentee whose rights have been infringed upon may bring an action before the proper CFI now (RTC) and to secure an injunction for the protection of his rights.

2) The burden of proof to substantiate a charge of infringement is with the plaintiff. But where the plaintiff introduces the patent in evidence, and the same is in due form, there is created a prima facie presumption of

its correctness and validity. The decision of the Commissioner (now Director) of Patent in granting the patent is presumed to be correct. The burden of going forward with the evidence (burden of evidence) then shifts to the defendant to overcome by competent evidence this legal presumption.

The question then in the instant case is whether or not the evidence introduced by private respondent herein is sufficient to overcome said presumption.

After a careful review of the evidence consisting of 64 exhibits and oral testimonies of five witnesses presented by private respondents before the Court of First Instance before the Order of preliminary injunction was issued as well as those presented by the petitioner, respondent Court of Appeals was satisfied that there is a prima facie showing of a fair question of invalidity of petitioner's patents on the ground of lack of novelty. As pointed out by said appellate court said evidence appeared not to have been considered at all by the court a quo for alleged lack of jurisdiction, on the mistaken notion that such question in within the exclusive jurisdiction of the patent office.

It has been repeatedly held that an invention must possess the essential elements of novelty , originality and precedence and for the patentee to be entitled to protection, the invention must be new to the world. Accordingly, a single instance of public use of the invention by a patentee for more than two years (now for more than one year only under Sec. 9 of the Patent Law) before the date of his application for his patent, will be fatal to, the validity of the patent when issued.

It will be noted that the validity of petitioner's patents is in question for want of novelty. Private respondent contends that powder puffs Identical in appearance with that covered by petitioner's patents existed and were publicly known and used as early as 1963 long before petitioner was issued the patents in question. (List of Exhibits, Rollo, pp. 194-199). As correctly observed by respondent Court of Appeals, "since sufficient proofs have been introduced in evidence showing a fair question of the invalidity of the patents issued for such models, it is but right that the evidence be looked into, evaluated and determined on the merits so that the matter of whether the patents issued were in fact valid or not may be resolved." (Rollo, pp. 286-287).

All these notwithstanding, the trial court nonetheless issued the writ of preliminary injunction which under the circumstances should be denied.

For failure to determine first the validity of the patents before aforesaid issuance of the writ, the trial court failed to satisfy the two requisites necessary if an injunction is to issue, namely: the existence of the right

SOTELO, MS | 2

PATENTS: DIGESTS

to be protected and the violation of said right. (Buayan Cattle Co., Inc. v. Quintillan, 128 SCRA 276).

Under the above established principles, it appears obvious that the trial court committed a grave abuse of discretion which makes certiorari the appropriate remedy.

As found by respondent Court of Appeals, the injunctive order of the trial court is of so general a tenor that petitioner may be totally barred from the sale of any kind of powder puff. Under the circumstances, respondent appellate court is of the view that ordinary appeal is obviously inadequate.

VARGAS v YAPTICO & CO40 PHIL 195

HELD:(1) When a patent is sought to be enforced, "the question of invention, novelty, or prior use, and each of them, are open to judicial examination." The burden of proof to substantiate a charge of infringement is with the plaintiff. Where, however, the plaintiff introduces the patent in evidence, if it is in due form, it affords a prima facie presumption of its correctness and validity. The decision of the Commissioner of Patents in granting the patent is always presumed to be correct. The burden then shifts to the defendant to overcome by competent evidence this legal presumption .With all due respect, therefore, for the critical and expert examination of the invention by the United States Patent Office, the question of the validity of the patent is one for judicial determination, and since a patent has been submitted, the exact question is whether the defendant has assumed the burden of proof as to anyone of his defenses

As herein before stated, the defendant relies on three special defenses. One such defense, on which the judgment of the lower court is principally grounded, and to which appellant devotes the major portion of his vigorous argument, concerns the element of novelty, invention, or discovery, that gives existence to the right to a patent. On this point the trial court reached the conclusion that "the patented plow of the plaintiff, Exhibit D, is not different from the native plow, Exhibit 2, except in the material, in the form, in the weight and the grade of the result, the said differences giving it neither a new function nor a new result distinct from the function and the result obtained from the native plow; consequently, its production does not presuppose the exercise of the inventive faculty but merely of mechanical skill, which does not give a right to a patent of an invention under the provisions of the Patent Law." In thus finding, the court may have been right, since the

Vargas plow does not appear to be such a "combination" as contains a novel assemblage of parts exhibiting invention.

A second line of defense relates to the fact that defendant has never made a complete Vargas plow, but only points, shares, shoes, and heel pieces, to serve as repairs. Defendant's contention is, that in common with other foundries, he has for years cast large numbers of plow points and shares suitable for use either on the native wooden plow, or on the Vargas plow. A difference has long been recognized between repairing and reconstructing a machine. If, for instance, partial injuries, whether they occur from accident or from wear and tear, to a machine for agricultural purposes, are made this is only re-fitting the machine for use, and thus permissible. Even under the more rigorous doctrine of Leeds & Catlin Co. vs. Victor Talking Machine Co. ([1909], 213 U.S., 325), it may be possible that all the defendant has done is to manufacture and sell isolated parts to be used to replace worn-out parts.

The third defense is, that under the provisions of the statute, an inventor's creation must not have been in public use or on sale in the United States (and the Philippine Islands) for more than two years prior to his application .Without, therefore, committing ourselves as to the first two defenses, we propose to base our decision on the one just suggested as more easily disposing of the case. (See 20 R. C. L., 1140-1142.) We do so with full consciousness of the doubt which arose in the mind of the trial court, but with the belief that since it has been shown that the invention was used in public at Iloilo by others than Vargas, the inventor, more than two years before the application for the patent, the patent is invalid.

Although we have spent some time in arriving at this point, yet having reached it, the question in the case is single and can be brought to a narrow compass. Under the English Statute of Monopolies (21 Jac. Ch., 3), and under the United States Patent Act of February 21, 1793, later amended to be as herein quoted, it was always the rule, as stated by Lord Coke, Justice Story and other authorities, that to entitle a man to a patent, the invention must be new to the world. As said by the United States Supreme Court, "it has been repeatedly held by this court that a single instance of public use of the invention by a patentee for more than two years before the date of his application for his patent will be fatal to the validity of the patent when issued."

On the facts, we think the testimony shows such a public use of the Vargas plow as to render the patent invalid Nicolas Roces, a farmer, testified that he had bought twenty Vargas plows, of which Exhibit 5 was one, in December, 1907; and Exhibit 5, the court found, was a plow completely identical with that for which the

SOTELO, MS | 3

PATENTS: DIGESTS

plaintiff had received a patent. The minor exception, and this in itself corroborative of Roces' testimony, is that the handle of plow Exhibit 5 is marked with the letters "A V" and not with the words "Patent Applied For" or "Patented Mar.12, 1912." Salvador Lizarraga, a clerk in a business house, testified that he had received plows similar to Exhibits D, 5, and 4, for sale on commission on May, 1908, from Bonifacio Araneta, partner of Vargas in the plow business. Ko Pao Ko, a blacksmith, testified that he had made fifty plow frames in 1905 for Vargas and Araneta, of which Exhibit 4 is one; Exhibit 4, the court found, is a plow identical with that patented by Vargas, but without share and mould-board. Alfred Berwin, an employee in the office of Attorney John Bordman, testified that on September 21, 1908, he had knowledge of a transaction wherein Vargas and Araneta desired to obtain money to invest in a plow factory. George Ramon Saul, a mechanic of the "Taller Visayas" of Strachan and MacMurray, testified that he had made Vargas plow points and shares of the present form upon order of Araneta and Vargas in 1906 and 1907 .William MacMurray, proprietor of the "Taller Visayas," corroborated the evidence of the witness Saul by the exhibition of the account against Vargas and Araneta wherein, under date of December 13, 1906, appears the item "12 new soft steel plow shares forged and bored for rivets as per sample." Against all this, was the testimony of the plaintiff Angel Vargas who denied that Saul could have been seen the Vargas plow in 1907 and 1907, who denied that Roces purchased the Vargas plow in 1907, who denied that Lizarraga could have acted as an agent to sell two plows in November, 1908, who denied any remembrance of the loan mentioned by Berwin as having been negotiated in September, 1908, who denied that Ko Pao Ko made fifty plows one of which is Exhibit 4, for Araneta and Vargas in 1905. Plaintiff introduced his books to substantiate his oral testimony .It is hardly believable that five or six witnesses for the defense would deliberately perjure themselves under oath. One might, but that all together, of different nationalities, would enter into such a conspiracy, is to suppose the improbable.

Tested by the principles which go to make the law, we think a preponderance of the evidence is to the effect that for more than two years before the application for the original letters patent, or before July 22, 1908, there was, by the consent and allowance of Vargas, a public use of the invention covered by them.

To conclude, we are not certain but that appellee has proved every one of his defenses. We are certain that he has at least demonstrated the public use of the Vargas plow over two years prior to the application for a patent. Such being the case, although on a different ground, we must sustain the judgment of

the lower court, without prejudice to the determination of the damages resulting from the granting of the injunction, with the costs of this instance against the appellant. So ordered.

FRANK v KOSUYAMA59 PHIL 206

HELD:The trial court did not decree the annulment of

the plaintiffs' patent and the herein defendant-appellee insists that the patent in question should be declared null and void. We are of the opinion that it would be improper and untimely to render a similar judgment, in view of the nature of the action brought by the plaintiffs and in the absence of a cross-complaint to that effect. For the purposes of this appeal, suffice it to hold that the defendant is not civilly liable for alleged infringement of the patent in question.

In the light of sound logic, the plaintiffs cannot insist that the "spindle" was a patented invention on the ground that said part of the machine was voluntarily omitted by them from their application, as evidenced by the photographic copy thereof (Exhibit 41) wherein it likewise appears that the patent on Improved Hemp Stripping Machines was issued minus the "spindle" in question. Were we to stress to this part of the machine, we would be giving the patent obtained by the plaintiffs a wider range than it actually has, which is contrary to the principles of interpretation in matters relating to patents.

In support of their claim the plaintiffs invoke the doctrine laid down by this court in the case of Frank and Gohn vs. Benito (51 Phil., 712), wherein it was held that the therein defendant really infringed upon the patent of the therein plaintiffs. It may be noted that the plaintiffs in the former and those of the latter case are the same and that the patent then involved is the very same one upon which the present action of the plaintiffs is based. The above-cited case, however, cannot be invoked as a precedent to justify a judgment in favor of the plaintiffs-appellants on the ground that the facts in one case entirely different from those in the other. In the former case the defendant did not set up the same special defenses as those alleged by the herein defendant in his answer and the plaintiffs therein confined themselves to presenting the patent, or rather a copy thereof, wherein the "spindle" was mentioned, and this court took for granted their claim that it was one of the essential characteristics thereof which was imitated or copied by the then defendant. Thus it came to pass that the "spindle" in question was insistently

SOTELO, MS | 4

PATENTS: DIGESTS

mentioned in the decision rendered on appeal as the essential part of the plaintiffs' machine allegedly imitated by the then defendant. In the case under consideration, it is obvious that the "spindle" is not an integral part of the machine patented by the plaintiffs on the ground that it was eliminated from their patent inasmuch as it was expressly excluded in their application, as evidenced by the aforesaid Exhibit 41.

Wherefore, reiterating that the defendant cannot be held civilly liable for alleged infringement of the patent upon which the present action is based on the ground that there is no essential part of the machine manufactured and sold by him, which was unknown to the public in the Province of Davao at the time the plaintiffs applied for and obtained their patent for improved hemp stripping machines, the judgment appealed from is hereby affirmed, with the costs against the plaintiffs-appellants. So ordered.

VARGAS v CHUA57 PHIL 784

HELD:The appellee is not entitled to the protection he

seeks for the simple reason that his plow, Exhibit F, does not constitute an invention in the legal sense, and because, according to the evidence, the same type of plows had been manufactured in this country and had been in use in many parts of the Philippine Archipelago, especially in the Province of Iloilo, long before he obtained his last patent.

In the above mentioned case of Vargas vs. F. M. Yaptico & Co., we said:

When a patent is sought to be enforced, "the questions of invention, novelty, or prior use, and each of them, are open to judicial examination." The burden of proof to substantiate a charge of infringement is with the plaintiff. Where, however, the plaintiff introduces the patent in evidence, if it is the due form, it affords a prima facie presumption of its correctness and validity. The decision of the Commissioner of Patents in granting the patent is always presumed to be correct. The burden then shifts to the defendant to overcome by competent evidence this legal presumption. With all due respects, therefore, for the critical and expert examination of the invention by the United States Patent Office, the question of the validity of the patent is one for judicial determination, and since a patent has been submitted, the exact question is whether the defendant has assumed the burden of proof as to anyone of his defenses.

We repeat that in view of the evidence presented, and particularly of the examination we have

made of the plows, we cannot escape the conclusion that the plow upon which the appellee's contention is based, does not constitute an invention and, consequently, the privilege invoked by him is untenable and the patent acquired by him should be declared ineffective.

The judgment appealed from is hereby reversed and the appellants are absolved from the complaint, with costs of this instance against the appellee. So ordered.

AGUAS v DE LEON111 SCRA 238

HELD:The validily of the patent issued by the

Philippines Patent Office in favor of the private respondent and the question over the inventiveness, novelty and usefulness of the improved process therein specified and described are matters which are better determined by the Philippines Patent Office. The technical staff of the Philippines Patent Office, composed of experts in their field, have, by the issuance of the patent in question, accepted the thinness of the private respondent's new tiles as a discovery. There is a presumption that the Philippines Patent Office has correctly determined the patentability of the improvement by the private respondent of the process in question.

The contention of the petitioner Aguas that the letters patent of de Leon was actually a patent for the old and non-patentable process of making mosaic pre-cast tiles is devoid of merit. De Leon never claimed to have invented the process of tile-making. The Claims and Specifications of Patent No. 658 show that although some of the steps or parts of the old process of tile making were described therein, there were novel and inventive features mentioned in the process.

In view of the foregoing, this Court finds that Patent No. 658 was legally issued, the process and/or improvement being patentable.

PARKE DAVIS & CO v DOCTOR’S PHARMA124 SCRA 115

HELD:Each of the circumstances mentioned in the law

as grounds stands alone and is independent of the others. And from them we can see that in order that any person may be granted a license under a particular patented invention relating to medicine under Section

SOTELO, MS | 5

PATENTS: DIGESTS

34(d), it is sufficient that the application be made after the expiration of three years from the date of the grant of the patent and that the Director should find that a case for granting such license has been made out. Since in the instant case it is admitted by petitioner that the chemical substance chloramphenicol is a medicine, while Letters Patent No. 50 covering said substance were granted to Parke Davis & Company on February 9, 1950, and the instant application for license under said patent was only filed in 1960, verily the period that had elapsed then is more than three years, and so the conditions for the grant of the license had been fulfilled. We find, therefore, no error in the decision of the Director of Patents on this aspect of the controversy.

SOTELO, MS | 6