SASOT vs.

People
G.R. No. 143193. June 29, 2005 Austria-Martinez

PETITIONER: Melbarose R. Sasot and Allandale R. Sasot

RESPONDENT: People of the Philippines, the honorable Court of Appeals, and Rebecca G.
Salvador, Presiding Judge, RTC, Branch 1, Manila

Summary: An information was filed against Sasot for possible violation of Art. 189 of the RPC on
unfair competition. Sasot filed for motion to quash the information on the grounds that there was no
offense as the NBA Properties Inc. is a foreign corporation not doing business in the Philippines and
could therefore have no standing to sue. Sasot’s Motion to Quash Information was denied by RTC
and CA, hence this certiorari. SC held that a special civil action for certiorari is not the proper
remedy to assail the denial of a motion to quash an information.

FACTS:

In May 1997, the NBI conducted an investigation pursuant to a complaint by the NBA Properties,
Inc., against petitioners for possible violation of Article 189 of the Revised Penal Code on unfair
competition. In the NBI Report it is stated that NBA Properties, Inc., is a foreign corporation
organized under the laws of the United States of America, and is the registered owner of NBA
trademarks and names of NBA basketball teams. The Report further stated that during the
investigation, it was discovered that petitioners are engaged in the manufacture, printing, sale, and
distribution of counterfeit “NBA” garment products. Hence, it recommended petitioners’
prosecution for unfair competition under Article 189 of the Revised Penal Code.

In a SPA dated October 7, 1997, Rick Welts, as President of NBA Properties, Inc., constituted the
law firm of Ortega, Del Castillo, Bacorro, Odulio, Calma & Carbonell, as the company’s attorney-in-
fact, and to act for and on behalf of the company, in the filing of criminal, civil and administrative
complaints, among others.

Prosecution Attorney Aileen Marie S. Gutierrez recommended the filing of an Information against
petitioners for violation of Article 189 of the RPC, but before the arraignment Sasot filed a Motion to
Quash the Information contending that the complainant is a foreign corporation not doing business in
the Philippines and cannot be protected by Philippine patent laws since it is not a registered
pantentee. Sasot also averred that they have been using the business name “ALLANDALE
SPORTSLINE, INC” since 1972, and their designs are original and do not appear to be similar to
complainant’s, and they do not use complainant’s logo or design.

The motion to quash was dismissed by the RTC. Sasot then filed a special civil action for certiorari
with the CA but it was also dismissed, as according to the CA it was not the proper remedy in
assailing a denial of a motion to quash. Hence this special action for certiorari under Rule 45 of the
ROC.

Issues:

Is a special civil action for certiorari the proper remedy to assail the denial of a motion to quash an
information?

Held:
NO. The Court has consistently held that a special civil action for certiorari is not the proper remedy
to assail the denial of a motion to quash an information.

The proper procedure in such a case is for the accused to enter a plea, go to trial without prejudice on
his part to present the special defenses he had invoked in his motion to quash and, if after trial on the
merits, an adverse decision is rendered, to appeal therefrom in the manner authorized by law. Thus,
petitioners should not have forthwith filed a special civil action for certiorari with the CA and
instead, they should have gone to trial and reiterate the special defenses contained in their motion to
quash. There are no special or exceptional circumstances in the present case such that immediate
resort to a filing of a petition for certiorari should be permitted.

Section 3, Rule 117 of the 1985 Rules of Criminal Procedure, which was then in force at the time the
alleged criminal acts were committed, enumerates the grounds for quashing an information, and
nowhere is there any mention of the defect in the complaint filed before the fiscal and the
complainant’s capacity to sue as grounds for a motion to quash.

A complaint is substantially sufficient if it states the known address of the respondent, it is

accompanied by complainant’s affidavit and his witnesses and supporting documents, and the
affidavits are sworn to before any fiscal, state prosecutor or government official authorized to
administer oath, or in their absence or unavailability, a notary public who must certify that he
personally examined the affiants and that he is satisfied that they voluntarily executed and
understood their affidavits.

Notes:
 Section 3, Rule 117 of the 1985 Rules of Criminal Procedure grounds for quashing an
information:
a) That the facts charged do not constitute an offense;
b) That the court trying the case has no jurisdiction over the offense charged or the
person of the accused;
c) That the officer who filed the information had no authority to do so;
d) That it does not conform substantially to the prescribed form;
e) That more than one offense is charged except in those cases in which existing laws
prescribe a single punishment for various offenses;
f) That the criminal action or liability has been extinguished;
g) That it contains averments which, if true, would constitute a legal excuse or
justification; and
h) That the accused has been previously convicted or in jeopardy of being convicted, or
acquitted of the offense charged.
 Even the absence of an oath in the complaint does not necessarily render it invalid. Want of
oath is a mere defect of form, which does not affect the substantial rights of the defendant on
the merits.
 Also cited in this case is La Chemise Lacoste, S.A. vs. Fernandez which is similar to the present
case where it was held that if prosecution follows after the completion of the preliminary
investigation being conducted by the Special Prosecutor the information shall be in the name of
the People of the Philippines and no longer the petitioner which is only an aggrieved party since
a criminal offense is essentially an act against the State. It is the latter which is principally the
injured party although there is a private right violated. Petitioner's capacity to sue would
become, therefore, of not much significance in the main case. We cannot allow a possible
violator of our criminal statutes to escape prosecution upon a far-fetched contention that the
aggrieved party or victim of a crime has no standing to sue.
 Sasot vs. People
 G.R. No. 143193 (June 29, 2005)
 TOPIC:
 1. UNFAIR COMPETITION UNDER ART 189 OF RPC IS A PUBLIC CRIME;
 2. THE PHILIPPINES IS UNDER AN INTERNATIONAL COMMITMENT, AS
 SIGNATORY TO THE MULTILATERAL TREATY AND AS A MATTER OF
 NATIONAL INTEREST, TO PROTECT INTELLECTUAL PROPERTY RIGHTS OF
 FOREIGN CORPORATIONS EVEN WHEN THE LATTER IS NOT ENGAGED AND
 LICENSED TO DO BUSINESS IN THE PHILIPPINES.
 FACTS:
 The National Bureau of Investigation (NBI) conducted an investigation pursuant to a
 complaint by the NBA Properties, Inc., against petitioners for possible violation of
 Article 189 of the Revised Penal Code on unfair competition. The Report stated that
 petitioners are engaged in the manufacture, printing, sale, and distribution of
 counterfeit "NBA" garment products.
 Before arraignment, petitioners filed a Motion to Quash the Information on the following
 grounds:
 I. THAT THE FACTS CHARGED DO NOT CONSTITUTE AN OFFENSE
 II. AND THIS HONORABLE COURT HAD NO JURISDICTION OVER THE OFFENSE
 CHARGED OR THE PERSON OF THE ACCUSED8
 Petitioners contend that complainant is a foreign corporation not doing business in the
 Philippines, and cannot be protected by Philippine patent laws since it is not a
 registered patentee. Petitioners aver that they have been using the business name
 "ALLANDALE SPORTSLINE, INC." since 1972, and their designs are original and do
 not appear to be similar to complainant’s, and they do not use complainant’s logo or
 design.10
 The trial prosecutor filed his Comment/Opposition to the motion to quash, stating that the
 State is entitled to prosecute the offense even without the participation of the private
 offended party, as the crime charged is a public crime.11
 The trial court sustained the prosecution’s arguments and denied petitioners’ motion to
 quash in its Order dated March 5, 1999.12
 Petitioners filed a special civil action for certiorari with the Court of Appeals (CA)
 which was dismissed. According to the CA, the petition is not the proper remedy in
 assailing a denial of a motion to quash, and that the grounds raised therein should be
 raised during the trial of the case on the merits.
 Petitioners sought reconsideration of the Decision but this was denied by the CA.16
 ISSUE: WON A FOREIGN CORPORATION NOT ENGAGED AND LICENSED TO DO
 BUSINESS IN THE PHILIPPINES MAY MAINTAIN A CAUSE OF ACTION FOR UNFAIR
 COMPETITION
 Intellectual Property Law
 HELD: The petition must be denied.
 *** the crime of Unfair Competition punishable under Article 189 of the Revised Penal
 Code34 is a public crime. It is essentially an act against the State and it is the latter
 which principally stands as the injured party. The complainant’s capacity to sue in
 such case becomes immaterial.
 In La Chemise Lacoste, S.A. vs. Fernandez,35 ***, the Court succinctly ruled that:
 More important is the nature of the case which led to this petition. What
 preceded this petition for certiorari was a letter-complaint filed before the NBI
 charging Hemandas with a criminal offense, i.e., violation of Article 189 of the
 Revised Penal Code. If prosecution follows after the completion of the
 preliminary investigation being conducted by the Special Prosecutor
 the information shall be in the name of the People of the Philippines
 and no longer the petitioner which is only an aggrieved party since a
 criminal offense is essentially an act against the State. It is the latter
 which is principally the injured party although there is a private right
 violated. Petitioner's capacity to sue would become, therefore, of not
 much significance in the main case. We cannot allow a possible violator of
 our criminal statutes to escape prosecution upon a far-fetched contention that
 the aggrieved party or victim of a crime has no standing to sue.
 In upholding the right of the petitioner to maintain the present suit before our courts
 for unfair competition or infringement of trademarks of a foreign corporation, we are
 moreover recognizing our duties and the rights of foreign states under the Paris
 Convention for the Protection of Industrial Property to which the Philippines and
 France are parties. We are simply interpreting and enforcing a solemn international
 commitment of the Philippines embodied in a multilateral treaty to which we are a
 party and which we entered into because it is in our national interest to do
 so.36 (Emphasis supplied)

PEARL & DEAN PHIL INC. VS.

SHOEMART- Trademark,
Copyright and Patents
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 or services of an
enterprise and shall include a stamped or marked container of goods. The scope of a copyright is
confined to literary and artistic works which are original intellectual creations in the literary and artistic
domain. Patentable inventions 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.

FACTS:
Pearl and Dean is a corporation in the manufacture of advertising display units also known as light
boxes, which were manufactured by Metro Industrial Services. A copyright Registration was obtained in
1981. These were marketed in the name of "Poster Ads". They also applied for a registration of
trademark with the Bureau of Patents in 1983, but was only approved in 19988. In 1985, petitioner had n
agreement with respondent Shoemart Inc (SMI) to install these light boxes in their Makati and Cubao
branch, Only the Makati branch was able to sigh the agreement. In 1986, the contract was rescinded
unilaterally by SMI, and instead contracted with Metro Industrial Services. They installed these
lightboxes in different SM city branches, including Cubao and Makati, with association with North Edsa
Marketing Inc (NEMI), SMI's sister company. Petitioner requested SMI and NEMI to put down their
installations of the light boxes, and payment of compensatory damages worth P20M. Claiming that
respondents failed to comply, they filed a case for infringement of trademark and copyright, unfair
competition and damages. RTC ruled in favor of petitioner, but CA reversed.
ISSUES:
(1) Whether there was a copyright infringement
(2) Whether there was a patent infringement
(3) Whether there was a trademark infringement
(4) Whether there was unfair competition

RULING: No to all.
(1) Copyright is a statutory right, subject to the terms and conditions specified in the statute. Therefore, it
can only cover the works falling within the statutory enumeration or description. Since the copyright was
classified under class "O" works, which includes "prints, pictorial illustrations, advertising copies, labels,
tags and box wraps," and does not include the light box itself. A lightbox, even admitted by the president
of petitioner company, was neither a literary nor an artistic work but an engineering or marketing
invention, thus not included under a copyright.

(2) Petitioner was not able to secure a patent for its lightboxes, and cannot legally prevent anyone from
manufacturing or commercially using the same. Patent has a three-fold purpose: a) to foster and reward
invention; b) promotes disclosures of invention and permit public to use the same upon expiration; c)
stringent requirements for patent protection to ensure in the public domain remain there for free use of
the public. Since petitioner was not able to go through such examination, it cannot exclude others from
manufacturing, or selling such lightboxes. No patent, no protection.

(3) The certificate of registration issued by the Director of Patents gives exclusive right to use its own
symbol only to the description specified in the certificate. It cannot prevent others to use the same
trademark with a different description.

(4) "Poster Ads" is a general term that cannot be associated specifically to Pearl and Dean, thus it
cannot be considered to use such term to be unfair competition against the petitioner.

KHO V. CA (G.R. NO. 115758)

Facts:
Petitioner, doing business under the name and style KEC Cosmetics Laboratory,
alleges that it is the registered owner of copyright and patent registration of the
Chin Chun Su container and medicated cream. Hence, petitioner filed a
complaint to enjoin respondent Summerville Company from advertising and
selling cream products under the same brand name Chin Chun Su as it will
mislead the public and damage petitioner’s business. The trial court granted the
injunction. On appeal, the writ was dissolved. The trial court ruled to bar
petitioner from using the mark Chin Chun Su.
Issue:
Whether or not petitioner is entitled to the exclusive use of the trademark Chin
Chun Su based on her copyright and patent registration over the product.
Ruling: NO.
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 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. Petitioner has no right to support her claim for the
exclusive use of the subject trade name and its container. The name and
container of a beauty cream product are proper subjects of a trademark inasmuch
as the same falls squarely within its definition.
In order to be entitled to exclusively use the same in the sale of the beauty cream
product, the user must sufficiently prove that she registered or used it before
anybody else did. The petitioner’s copyright and patent registration of the name
and container would not guarantee her right to the exclusive use of the same for
the reason that they are not appropriate subjects of the said intellectual rights.
Consequently, a preliminary injunction order cannot be issued for the reason that
the petitioner has not proven that she has a clear right over the said name and
container to the exclusion of others, not having proven that she has registered a
trademark thereto or used the same before anyone did.

379 SCRA 410 – Mercantile Law – Intellectual Property – Law on Copyright – Proper Subjects
of Copyright
Elidad Kho is the owner of KEC Cosmetics Laboratory and she was also the holder of
copyrights over Chin Chun Su and its Oval Facial Cream Container/Case. She also bought the
patent rights over the Chin Chun Su & Device and Chin Chun Su for medicated cream from one
Quintin Cheng, who was the assignee of Shun Yi Factory – a Taiwanese factory actually
manufacturing Chin Chun Su products.
Kho filed a petition for injunction against Summerville General Merchandising and Company to
enjoin the latter from advertising and selling Chin Chun Su products, in similar containers as
that of Kho, for this is misleading the public and causing Kho to lose income; the petition is also
to enjoin Summerville from infringing upon Kho’s copyrights.
Summerville in their defense alleged that they are the exclusive and authorized importer, re-
packer and distributor of Chin Chun Su products; that Shun Yi even authorized Summerville to
register its trade name Chin Chun Su Medicated Cream with the Philippine Patent Office; that
Quintin Cheng, from whom Kho acquired her patent rights, had been terminated (her services)
by Shun Yi.
ISSUE: Whether or not Kho has the exclusive right to use the trade name and its container.
HELD: No. Kho has no right to support her claim for the exclusive use of the subject trade
name and its container. The name and container of a beauty cream product are proper subjects
of a trademark (not copyrightlike what she registered for) inasmuch as the same falls squarely
within its definition. In order to be entitled to exclusively use the same 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 registration of the name and container would not guarantee
her the right to the exclusive use of the same for the reason that they are not appropriate
subjects of the said intellectual rights. Consequently, a preliminary injunction order cannot be
issued for the reason that the petitioner has not proven that she has a clear right over the said
name and container to the exclusion of others, not having proven that she has registered a
trademark thereto or used the same before anyone did.

SMITH KLINE BECKMAN CORPORATION v. COURT OF APPEALS, et al. 409

SCRA 33 (2003)

When the language of its claims is clear and distinct, the patentee is bound thereby and
may not claim anything beyond them.

Petitioner Smith Kline Beckman Corporation (SKBC) was granted by the Philippine Patent
Office Letters Patent No. 14561 over an invented compound entitled “Methods
and Compositions for Producing Biphasic Parasiticide Activity Using Methyl 5 Propylthio-2-
Benzimidazole Carbamate.” Such compound is claimed to be an active ingredient in fighting
various parasites in certain types of domestic and livestock animals. Respondent Tryco
Pharma (Tryco) sells veterinary products including a drug Impregon which contains
Albendazole as an active ingredient which fights against parasites in animals. Petitioner
SKBC then filed an action against respondent Tryco for patent infringement claiming that
the patent granted to them includes said Albendazole. In their defense respondent Tryco
alleges that Letters Patent No. 14561 granted to petitioner SKBC does not include
Albendazole for nowhere is such word found in the patent. The Trial Court rendered its
decision in favor of respondent Tryco which was affirmed by the Court of Appeals.

ISSUES:

Whether or not the Court of Appeals erred in not finding that Albendazole is included in
petitioners Letter Pattent No. 14561

HELD:

From an examination of the evidence on record, the Court finds nothing infirm in
the appellate court’s conclusions with respect to the principal issue of whether Tycho
Pharma committed patent infringement to the prejudice of SKBC. The burden of proof to
substantiate a charge for patent infringement rests on the plaintiff. In the case at bar,
petitioner’s evidence consists primarily of its Letters Patent No. 14561, and the testimony of
Dr. Orinion, its general manager in the Philippines for its Animal Health Products Division,
by which it sought to show that its patent for the compound methyl 5 propylthio-2-
benzimidazole carbamate also covers the substance Albendazole. From a reading of the 9
claims of Letters Patent No. 14561 in relation to the other portions thereof, no mention is
made of the compound Albendazole.

When the language of its claims is clear and distinct, the patentee is bound thereby and may
not claim anything beyond them. And so are the courts bound which may not add to or
detract from the claims matters not expressed or necessarily implied, nor may
they enlarge the patent beyond the scope of that which the inventor claimed and the patent
office allowed, even if the patentee may have been entitled to something more than the
words it had chosen would include. It bears stressing that the mere absence of the
word Albendazole in Letters Patent No. 14561 is not determinative of Albendazole’s non-
inclusion in the claims of the patent. While Albendazole is admittedly a chemical compound
that exists by a name different from that covered in SKBC’s letters patent, the language of
Letter Patent No. 14561 fails to yield anything at all regarding Albendazole. And no extrinsic
evidence had been adduced to prove that Albendazole inheres in SKBC’s patent in spite of
its omission therefrom or that the meaning of the claims of the patent embraces the same.
While SKBC concedes that the mere literal wordings of its patent cannot establish Tyco
Pharma’s infringement, it urges the Court to apply the doctrine of equivalents.

The doctrine of equivalents provides that an infringement also takes place when a device
appropriates a prior invention by incorporating its innovative concept and, although with
some modification and change, performs substantially the same function in substantially
the same way to achieve substantially the same result. Yet again, a scrutiny of SKBC’s
evidence fails to convince the Court of the substantial sameness of SKBC’s patented
compound and Albendazole. While both compounds have the effect of neutralizing
parasites in animals, identity of result does not amount to infringement of patent unless
Albendazole operates in substantially the same way or by substantially the same means as
the patented compound, even though it performs the same function and achieves the same
result.

In other words, the principle or mode of operation must be the same or substantially the
same. The doctrine of equivalents thus requires satisfaction of the function-means-and-
result test, the patentee having the burden to showthat all three components of such
equivalency test are met.

409 SCRA 33 – Intellectual Property Law – Law on Patents – Doctrine of Equivalents

Smith Kline is a US corporation licensed to do business in the Philippines. In 1981, a patent
was issued to it for its invention entitled “Methods and Compositions for Producing Biphasic
Parasiticide Activity Using Methyl 5 Propylthio-2-Benzimidazole Carbamate.” The invention is a
means to fight off gastrointestinal parasites from various cattles and pet animals.
Tryco Pharma is a local corporation engaged in the same business as Smith Kline.
Smith Kline sued Tryco Pharma because the latter was selling a veterinary product called
Impregon which contains a drug called Albendazole which fights off gastro-intestinal
roundworms, lungworms, tapeworms and fluke infestation in carabaos, cattle and goats.
Smith Kline is claiming that Albendazole is covered in their patent because it is substantially the
same as methyl 5 propylthio-2-benzimidazole carbamate covered by its patent since both of
them are meant to combat worm or parasite infestation in animals. And that Albendazole is
actually patented under Smith Kline in the US.
Tryco Pharma averred that nowhere in Smith Kline’s patent does it mention that Albendazole is
present but even if it were, the same is “unpatentable”.
Smith Kline thus invoked the doctrine of equivalents, which implies that the two substances
substantially do the same function in substantially the same way to achieve the same results,
thereby making them truly identical for in spite of the fact that the word Albendazole does not
appear in Tryco Paharma’s letters of patent, it has ably shown by evidence its sameness with
methyl 5 propylthio-2-benzimidazole carbamate.
ISSUE: Whether or not there is patent infringement in this case
HELD: No. Smith Kline failed to prove that Albendazole is a compound inherent in the patented
invention. Nowhere in the patent is the word Albendazole found. When the language of its
claims is clear and distinct, the patentee is bound thereby and may not claim anything beyond
them. Further, there was a separate patent for Albendazole given by the US which implies that
Albendazole is indeed separate and distinct from the patented compound here.
A scrutiny of Smith Kline’s evidence fails to prove the substantial sameness of the patented
compound and Albendazole. While both compounds have the effect of neutralizing parasites in
animals, identity of result does not amount to infringement of patent unless Albendazole
operates in substantially the same way or by substantially the same means as the patented
compound, even though it performs the same function and achieves the same result. In other
words, the principle or mode of operation must be the same or substantially the same.
The doctrine of equivalents thus requires satisfaction of the function-means-and-result test, the
patentee having the burden to show that all three components of such equivalency test are met.