The scope and interplay of IP rights

Republic Act No. 8293 or the Intellectual Property Code (IP Code) divided intellectual property into three groups – patent, trademark and copyright. In three recent cases, the Supreme Court held that the scope of IP rights arising from each of the intellectual property are "completely distinct and separate from one another, and the protection afforded by one cannot be used interchangeably to cover items or works that exclusively pertain to the others."

It was in Kho v. Court of Appeals (379 SCRA 410) where the Supreme Court first made the following pronouncement, which was reiterated in two subsequent cases: "Trademark, copyright and patents are different intellectual property rights that cannot be interchanged with one another. A trademark is any visible sign capable of distinguishing the goods (trademark) or services (service mark) or an enterprise and shall include a stamped or marked container of goods. In relation thereto, a trade name means the name or designation identifying or distinguishing an enterprise. Meanwhile, the scope of a copyright is confined to literary and artistic works which are original intellectual creations in the literary and artistic domain protected from the moment of their creation. Patentable inventions, on the other hand, refer to any technical solution of a problem in any field of human activity which is new, involves an inventive step and is industrially applicable." To illustrate, the names "San Miguel Beer" and "San Mig Light" are trademarks of San Miguel Corp., the process for making beer is the proper subject of a patent, and the print and broadcast advertisement of San Miguel Beer are copyrighted.

In Kho, petitioner Elidad Kho applied for the issuance of writ of preliminary injunction restraining Summerville General Merchandising and Co. from advertising and selling cream products under the brand name "Chin Chu Su." Kho alleged that she is entitled to exclusively use the name "Chin Chu Su" and the container of a beauty cream product on the ground that she is the registered owner of the copyrights to "Chin Chun Su" and "Oval Facial Cream Container/Case." She also alleged that she has trademark rights (although in her complaint, she inexplicably called it "patent rights") over "Chin Chun Su & Device" and "Chin Chun Su" for medicated cream, having purchased such rights from the registered owner thereof in the Supplemental Register of the Philippines Patent Office. The Supreme Court held that the name and container of a beauty cream product are proper subjects of a trademark. In order to be entitled to the exclusive right to use the trademark "Chin Chun Su" an d its container in the sale of the beauty cream product, the user must sufficiently prove that she registered or used it before anybody else did. Kho’s copyright and patent registrations of the name and container would not guarantee her the right to the exclusive use of the same because they are not appropriate subjects of the said IP rights. (The Supreme Court admitted her erroneous allegation that she owned patent registrations. Earlier, the Court of Appeals ruled that the registration of a trademark in the Supplemental Register cannot be equated with registration in the Principal Register that grants exclusive right to use the same.) Having failed to prove that she is the registered owner or the first user of the trademark, the Supreme Court ruled that a writ of preliminary injunction could not be issued in her favor.

In the interesting case of Pearl & Dean (Phil.), Inc. v. Shoemart, Inc. (409 SCRA 231), Pearl & Dean, Inc. (P&D) manufactured advertising display units called light boxes that utilize specially printed posters sandwiched between plastic sheets and illuminated with back lights. P&D obtained a National Library certificate of copyright registration for the technical drawings of the light boxes classified under category "O" (prints, pictorial illustrations, advertising copies, labels, tags, and box wraps) of P.D. 49 or the Intellectual Property Decree. The light boxes were marketed under the trademark "Poster Ads" which was duly registered with the then Bureau of Patents, Trademarks and Technology Transfer (now the Intellectual Property Office or IPO) covering the following products: stationeries such as letterheads, envelopes & calling cards, and newsletters. P&D negotiated with Shoemart, Inc. (SM) for the lease and installation of its light boxes in two SM malls. SM subsequently rescinded its contract with P&D and contracted with other entities for the construction of similar light boxes for its malls using also the trademark "Poster Ads". P&D filed a case for infringement of trademark and copyright, and unfair competition against SM.

The Supreme Court held that SM was not liable for copyright, patent and trademark infringements and for unfair competition. SM could not be liable for copyright infringement because P&D secured its copyright under class "O" work and its protection extended only to the technical drawings within the category of "pictorial illustrations" and not to the light box itself. Furthermore, the light box was not a literary or artistic piece that could be copyrighted under the copyright law. Since only the expression of an idea, and not the idea itself, is protected by a copyright, copyright protection cannot extend to the object depicted or illustrated in the copyrightable work. Similarly, SM could not be held liable for patent infringement because P&D never secured a patent for its light box, assuming it was a patentable invention. An inventor cannot sue for infringement of patent unless a patent has been issued by the IPO. It is the patent that gives the patentee the monopoly or right to exclude all others from making, using, offering for sale, selling or importing the invention during the term of the patent.

SM also could not be held liable for trademark infringement because a trademark certificate confers on the registrant the exclusive right to use the trademark only to those goods specified in the certificate (and those that are related thereto under the IP Code), which in the case of P&D’s certificate, did not include backlit advertising units or light boxes. The failure of P&D to secure a trademark registration for specific use on the light boxes meant that there could not have been any trademark infringement since registration is an essential element thereof. Likewise, SM could not be held liable for unfair competition. Unfair competition is the passing off of one’s goods as those of another. As such, there is no unfair competition under the law on copyrights. It is only applicable to disputes over the use of trademarks. The Court ruled that the name "Poster Ads" is not well known or distinctive as to be associated with P&D in the mind of the purchasing public. Consequently, there was no "passing off" of goods.

In the most recent case of Ching v. Salinas (462 SCRA 241), the Court held that no statutory right to a copyright arose in favor of the holder of a certificate of copyright where the work for which copyright was sought is not copyrightable under the IP Code.

Petitioner Jessie Ching is the maker and manufacturer of a utility model, described as "Leaf Spring Eye Bushing for Automobile" made up of plastic, for which he was issued by the National Library copyright certificates entitled "Leaf Spring Eye Bushing for Automobile" and "Vehicle Bearing Cushion". Ching requested the National Bureau of Investigation (NBI) to investigate alleged illegal manufacturers, producers and/or distributors of the utility model. Upon the application of the NBI, the RTC of Manila issued, but subsequently quashed, the search warrants for the seizures of alleged pirated articles against William Salinas and the officers and members of the Board of Directors of Wilaware Product Corp. Ching questioned the quashal of the search warrants all the way to the Supreme Court. The Court held that the RTC rightly quashed the search warrants because Ching did not own a valid copyright and hence, there could not have been any copyright infringement. The Court ruled that the "Leaf Spring Eye Bushing for Automobile" and "Vehicle Bearing Cushion" are not literary or artistic works. They are not intellectual creations in the literary and artistic domain, or works of applied art. Being plain automotive spare parts that must conform to the original structural design of the components they seek to replace, they are not ornamental designs nor do they have decorative quality or value. They are not even artistic creations with incidental utilitarian functions or works incorporated in a useful article. According to the Court, they are utility models, mechanical works or useful articles without artistic design or value. Hence, they are not copyrightable.

Parenthetically, if Ching had the foresight to file applications with the IPO for utility model patents for "Leaf Spring Eye Bushing for Automobile" and "Vehicle Bearing Cushion", he may have a cause of action for patent infringement against illegal manufacturers of the utility models upon the issuance of the utility model patents. A utility model patent (called a "petty patent" in some countries) provides a short-term and cheaper protection to mechanical devices and other manufactured items that may not be sufficiently inventive to meet the inventive threshold required for invention patents.

Laymen often freely interchange the IP rights in everyday conversation. How many times have we heard the phrase "to patent a trademark" or heard counterfeit goods referred to as "pirated"? Yet, as these cases showed, the implications arising from the existence of the separate and distinct IP rights are significant, and if IP right holders ignore or overlook these, it is at their own peril.

(The author is an Associate of the Angara Concepcion Regala & Cruz Law Offices (ACCRALAW). He may be contacted at tel. No. 830-8000, fax no. 894-4697 or via email at [email protected])