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IP Views
IP rights and remedies clarified
by: Jonathan Q. Perez PHILIPPINE IP LAW IN PERSPECTIVE:
A Fresh Discourse on the Interplay of Patents, Copyrights, Trademarks
and Unfair Competition
By: Jonathan Q. Perez
The case of Pearl & Dean (Phil.), Inc. v. Shoemart, Inc. and
North Edsa Marketing, Inc. (G.R. No. 148222, August 15, 2003)
Where do we draw the line between and among patent infringement,
copyright infringement, trademark infringement and unfair competition?
The Case:
Pearl & Dean, Inc. (P&D) is a corporation engaged in the manufacture of
advertising display units called light boxes. The light boxes were
derived from technical drawings, which were registered with the National
Library. P&D obtained a copyright certificate for the drawings, which
were classified under category "O" of the Intellectual Property Decree (P.D.
49). The category pertains to "prints, pictorial illustrations,
advertising copies, labels, tags, and box wraps." The light boxes were
marketed under the trademark "Poster Ads" which was duly registered
before the Bureau of Patents, Trademarks and Technology Transfer (BPTTT).
P&D negotiated with Shoemart, Inc. (SM) for the lease and installation
of its light boxes in two mall branches. For some reason, SM rescinded
its contract with P&D. Later, SM contracted with several entities for
the construction of light boxes for its chain of stores.
In time, P&D discovered that SM installed light boxes in several of its
stores; the light boxes are similar to those that P&D manufactures. P&D
also found out that SM used the trademark "Poster Ads" in marketing its
own version of the light boxes. Eventually, P&D demanded SM to refrain
from using the subject light boxes and to remove them from its
establishments. Not satisfied with SM's response to its demands, P&D
sued SM for infringement of trademark and copyright, unfair competition
and damages.
The trial court ruled in favor of P&D and found SM to have infringed
P&D's copyright and trademark "Poster Ads". On appeal, however, the
Court of Appeals reversed the trial court's ruling and declared that SM
did not infringe P&D's copyright and trademark.
The Supreme Court sustained the Court of Appeals decision that there was
no copyright infringement and trademark infringement committed against
P&D.
The Ruling:
In deciding this case, the High Court neatly delineated the scope of the
four main concerns of intellectual property law (patents, copyrights,
trademarks and unfair competition), in this manner:
- Copyright protection is strictly limited to the copyrightable
materials as enumerated under the law, i.e. technical drawings
falling under the domain of literary and artistic works. Protection
cannot extend to the object being depicted in the copyrightable
work.
- Patent protection on inventions or functional creations can be
availed of only if there is a patent grant on them. Hence, there is
a need to secure a patent from the government to protect the
invention or functional creation from being appropriated by any
entity other than the patentee. A patent gives the exclusive right
to use and exploit the patented invention and consequently to
prevent others from exercising the same privileges without the
consent of the patentee.
- Protection on a registered trademark is confined to the use of
the trademark on the goods specified in the certificate of
registration. Thus, the use of a registered trademark on other items
or goods not contemplated in the certificate of registration is not
trademark infringement. (Note: It appears that the Supreme Court,
while it correctly cited the case of Faberge, Inc. v. Intermediate
Appellate Court on the limitation of the use of trademarks to those
specified in the certificate, failed to appreciate that Section 20
of the old Trademark Law [R.A. No. 166] had already been modified by
Section 138 of the Republic Act No. 8293 or the Intellectual
Property Code ["IP Code"] to include the phrase "and those that are
related thereto." Corollarily, Section 123(f) of the IP Code already
bars the registration of identical or confusingly similar trademarks
used on goods or services different from those contemplated in the
registration provided that the trademark is well-known and the use
of the trademarks on the goods will create in the mind of the public
the impression that they are from the owner of the registered mark.)
- There is no unfair competition under the law on copyrights.
Instead, unfair competition is usually applicable to disputes over
the use of trademarks.
Following the aforementioned principles, the Supreme Court declared
that:
- SM did not commit copyright infringement because it did not
reproduce or copy per se the technical drawings copyrighted in favor
of P & D. In fact, SM merely manufactured the light boxes depicted
in the technical drawings.
- In the same manner, SM did not commit patent infringement. While
it manufactured the light boxes depicted in P & D's copyrighted
work, the same light boxes being functional creations or inventions
were not covered by any patent in favor of P & D.
- SM did not commit trademark infringement for the use of the
trademark "Poster Ads". Despite the registration of the trademark
"Poster Ads" in favor of P & D, the registration limits the use of
the trademark to those specified in the corresponding certificate of
registration, which do not include light boxes. Apparently, P & D
failed to secure trademark registration for the use of the trademark
"Poster Ads" on light boxes.
- SM is not liable for unfair competition. The phrase "Poster Ads"
is generic and incapable of being used as a trademark in the
business of poster advertising. Besides, even if it was eventually
registered as a trademark in favor of P & D, it is not well known or
distinctive as to easily associate it with P & D.
Distinctions between and among the various fields of intellectual
property:
The Supreme Court reiterated its earlier pronouncement in the recent
case of Kho v. Court of Appeals (G.R. No. 115758, March 19,
2002), where it ruled that copyrights, trademarks and patents 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." In said case, the following
distinctions were made:
"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) of an enterprise and shall include a stamped or marked
container of goods. In relation, thereto, a trade name means the name or
designation identifying or distinguishing an enterprise. Meanwhile, the
scope of a copyright is confined to literary or artistic works which are
original intellectual creations in the literary or 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."
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