ISABELO DOCE vs. WORKMEN’S COMPENSATION COMMISSION and DADO JADAO

ISABELO DOCE vs. WORKMEN’S COMPENSATION COMMISSION and DADO JADAO

GR No. L-9417

Date: December 22, 1958

PONENTE: Bautista Angelo, J.

FACTS:

Dado Jadao filed with the Workmen's Compensation Commission a claim for compensation against Isabelo Doce for injuries he suffered in an accident that occurred while working as a conductor of a bus belonging to the latter under a boundary system.

His average daily earnings as conductor was P4.00, working five days a week. On June 11, 1953, while acting as such conductor, Jadao was pinned by two buses on Quezon Boulevard, Manila, suffering injuries on the right leg, head and left ear. He was treated in the North General Hospital and in the National Orthopedic Hospital, and as a result he suffered temporary total disability and a partial loss of the use of his right leg.

Doce interposed the defense that there was no employer-employee relationship between him and Jadao and hence the Commission has no jurisdiction to act on the claim.

ISSUE: Whether the employer-employee relationship existed between the owner of the bus and the conductor considering that the latter worked under a boundary system as explained above and is not paid directly by the former.

RULING: YES. This case falls squarely within our ruling in National Labor Union vs. Dinglasan, 52 Off. Gaz., No. 4, 1933, wherein this Court held that a driver of a jeep who operates the same under the boundary system is considered an employee within the meaning of the law and as such the case comes under the jurisdiction of the Court of Industrial Relations.

Not having any interest in the business because they did not invest anything in the acquisition of the jeeps and did not participate in the management thereof, their service as drivers of the jeeps being their only contribution to the business, the relationship of lessor and lessee cannot be sustained.

CITIZENS’ LEAGUE OF FREEWORKERS V. ABBAS

CITIZENS’ LEAGUE OF FREEWORKERS V. ABBAS

G.R. No. L-21212

23 September 1966

PONENTE: DIZON, J.

FACTS:

Respondent-spouses, owners and operators of auto-calesas in Davao City, filed a complaint with the CFI of Davao to restrain the Union and its members, who were drivers of the spouses in said businesses, from interfering with its operation, from committing certain acts complained of in connection therewith, and to recover damages. The complaint alleged that the defendants named therein used to lease the auto calesas of the spouses on a daily rental basis. When the spouses refused to recognize the alleged lessees as employees and also refused to bargain with it on that basis, the Union declared a strike. Since then, they had paralyzed the business operations of the said spouses through threats, intimidation, and violence.

Petitioners filed a complaint for unfair labor practice against the respondent-spouses with the Court of Industrial Relations on the ground, among others, of the latter’s refusal to bargain with them. They also filed a motion to declare the writ of preliminary injunction void on the ground that it had already expired.

ISSUE: May the petitioners in this case, as “lessees” of the auto-calesas be considered employees?

RULING: YES.

"This case falls squarely within our ruling in National Labor Union v. Dinglasan, 52 O.G., No. 4, 1933, wherein this Court held that a driver of a jeep who operates the same under the boundary system is considered an employee within the meaning of the law and as such the case comes under the jurisdiction of the Court of Industrial Relations.

In that case, Benedicto Dinglasan was the owner and operator of TPU jeepneys which were driven by petitioner under verbal contracts that they will pay P7.50 for 10 hours use under the so called 'boundary system/ The drivers did not receive salaries or wages from the owners Their day's earnings were the excess over the P7.50 they paid for the use of the jeepneys. In the event that they did not earn more, the owner did not have to pay them anything. In holding that the employer-employee relationship existed between the owner of the jeepneys and the drivers even if the latter worked under the boundary system, this Court said:

“The only features that would make the relationship of lessor and lessee between the respondent, owner of the jeeps, and the drivers, members of the petitioner union, are the fact that he does not pay them any fixed wage but their compensation is the excess of the total amount of fares earned or collected by them over and above the amount of P7.50 which they agreed to pay to the respondent. and the fact that the gasoline burned by the jeeps is for the account of the drivers. These two features are not, however, sufficient to withdraw the relationship, between them from that of employer-employee, because the estimated earnings for 'fares must be over and above the amount they agreed to pay to the respondent for a ten-hour shift or ten-hour a day operation of the jeeps. Not having any interest in the business because they did not invest anything in the acquisition of the jeeps and did not participate in the management thereof: their service as drivers of the jeeps being their only contribution to the business, the relationship of lessor and lessee, cannot be sustained.”

ANGEL JARDIN ET AL vs. NLRC and GOODMAN TAXI

ANGEL JARDIN ET AL vs. NLRC and GOODMAN TAXI

G.R. No. 119268.

February 23, 2000

QUISUMBING, J.

FACTS:

Petitioners were drivers of private respondent, Philjama International Inc., a domestic corporation engaged in the operation of "Goodman Taxi." Petitioners used to drive private respondents taxicabs every other day on a 24-hour work schedule under the boundary system. Under this arrangement, the petitioners earned an average of P400.00 daily. Nevertheless, private respondent admittedly regularly deducts from petitioners daily earnings the amount of P30.00 supposedly for the washing of the taxi units. Believing that the deduction is illegal, petitioners decided to form a labor union to protect their rights and interests.

Upon learning, respondent refused to let petitioners drive their taxicabs when they reported for work.

Upon learning about the plan of petitioners, private respondent refused to let petitioners drive their taxicabs when they reported for work on August 6, 1991, and on succeeding days. Petitioners suspected that they were singled out because they were the leaders and active members of the proposed union.

Aggrieved, petitioners filed with the labor arbiter a complaint against private respondent for unfair labor practice, illegal dismissal and illegal deduction of washing fees.

LA: Dismissed for Lack of Merit

NLRC: Declared that petitioners are employees of private respondent. On reconsideration however, the decision was reversed by the NLRC tribunal and held that no employer-employee relationship between the parties exists.

ISSUE: Whether or not petitioner taxi drivers are employees of respondent company.

RULING:

YES. In a number of cases decided by this Court, we ruled that the relationship between jeepney owners/operators on one hand and jeepney drivers on the other under the boundary system is that of employer-employee and not of lessor-lessee. We explained that in the lease of chattels, the lessor loses complete control over the chattel leased although the lessee cannot be reckless in the use thereof, otherwise he would be responsible for the damages to the lessor. In the case of jeepney owners/operators and jeepney drivers, the former exercise supervision and control over the latter. The management of the business is in the owners hands. The owner as holder of the certificate of public convenience must see to it that the driver follows the route prescribed by the franchising authority and the rules promulgated as regards its operation. Now, the fact that the drivers do not receive fixed wages but get only that in excess of the so-called "boundary" they pay to the owner/operator is not sufficient to withdraw the relationship between them from that of employer and employee. We have applied by analogy the abovestated doctrine to the relationships between bus owner/operator and bus conductor, auto-calesa owner/operator and driver, and recently between taxi owners/operators and taxi driver.  Hence, petitioners are undoubtedly employees of private respondent because as taxi drivers they perform activities which are usually necessary or desirable in the usual business or trade of their employer.

SOCIETE DES PRODUITS NESTLE, S.A. v CA and CFC CORP

SOCIETE DES PRODUITS NESTLE, S.A. v CA and CFC CORP

G.R. NO. 112012

April 4, 2001

Ynares-Santiago, J.

FACTS:

CFC corporation filed with Bureau of Patents a registration of the Trademark  “FLAVOR MASTER” for instant coffee. Petitioner Societe Des Produits Nestle filed an unverified Notice of Opposition, claiming that the trademark of respondent’s product is confusingly similar to its Trademarks for coffee: “MASTER ROAST AND MASTER BLEND”. Nestle Philippines also filed notice of opposition against the registration Petitioners argued that it would cause confusion in trade, or deceive purchasers and would falsely suggest to the public a connection between the two marks.

ISSUE: Is the TM, FLAVOR MASTER, a colorable imitation of the TMs MASTER ROAST and MASTER BLEND?

RULING:

YES. The TM sought to be registered is likely to cause confusion.

A trademark has been generally defined as any word, name, symbol, or device adopted and used by a merchant to identify his goods and distinguish them from those sold by others. Such is entitled to protection

Under the Philippine Trademark Law, the owner of a TM cannot register if it resembles a mark or trade-name registered in the Philippines or a mark previously used and not abandoned WHICH IS LIKELY TO CAUSE CONFUSION OR MISTAKE OR TO DECEIVE PURCHASERS.

The law prescribes a stringent standard proscribes registration if it causes confusing similarity, and if it is likely to cause confusion or mistake or deceive purchasers. Colorable imitation denotes a close imitation as to be calculated to deceive ordinary persons  as to cause him to purchase the one supposing it to be the other.

In determining colorable imitation there are two tests: Dominancy Test and Holistic Test.

The test of dominancy focuses on the similarity of the prevalent features of the competing trademarks; the holistic test mandates the entirety of the marks in question must be considered in determining confusing similarity

The Dominancy test should be applied as it relies not only on the visual but also on the aural and connotative comparisons and overall impressions between the two TMs.

·         The word MASTER is the dominant feature which is neither a generic nor a descriptive term. As such said term cannot be invalidated as a trademark and therefore, may be protected.

·         Generic terms are those which constitute the common descriptive name of an article or substance and are not legally protectable.

·         The term MASTER is a suggestive which require imagination, thought, and perception to reach a conclusion as to the nature of the goods.

The term MASTER has acquired a certain connotation to mean the coffee products MASTER ROAST and Master Blend produced by NESTLE. AS SUCH the use of CFC of the term “MASTER” is likely to cause confusion or mistake.

SMITH KLINE BECKMAN CORP. v. COURT OF APPEALS

SMITH KLINE BECKMAN CORP. v. COURT OF APPEALS

G.R. NO. 126627

August 14, 2003

CARPIO-MORALES, J

FACTS:

Smith Kline Beckman Corp. (US corporation) filed as assignee, before the Philippine Patent Office an application for patent over an invention entitled Methods and Compositions for Producing Biphasic Parasiticide Activity Using Methyl 5 Propylthio-2-Benzimidazole Carbamate.Letters Patent for the aforesaid invention was issued to petitioner for a term of 17 years, which provides that the patented invention consisted of a new com ound named methyl 5 propylthio-2benzimidazole carbamate and the methods or compositions utilizing the compound as an active ingredient in fighting infections caused by gastrointestinal parasites and lungworms in animals such as swine, sheep, cattle, goats, horses, and even pet animals. 

Tryco Pharma Corp. is a domestic corporation that manufactures, distributes and sells veterinary products, including Impregon, a drug that has Albendazole for its active ingredient and is claimed to be effective against gastrointestinal roundworms, lungworms, tapeworms and fluke infestation in carabaos, cattle and goats.

Petitioner sued private respondent for infringement of patent and unfair competition before the Caloocan City RTC. It claimed that its patent covers or includes the substance Albendazole such that private respondent, by manufacturing, selling, using, and causing to be sold and used the drug Impregon without its authorization, committed infringement and unfair competition under RPC and The Trademark Law for advertising and selling as its own the drug Impregon although the same contained petitioner’s patented Albendazole.

Private respondent averred that petitioner’s letter patent does not cover the substance Albendazole for nowhere in it does that word appear.

RTC ruled for the Respondent. CA upheld trial court’s ruling and held that respondent was not liable for any infringement of the patent of petitioner in light of the latter’s failure to show that Albendazole is the same as the compound subject of its Letters Patent, considered the U.S. patent as implying that Albendazole is different from methyl 5 propylthio-2-benzimidazole carbamate, and likewise found that private respondent was not guilty of deceiving the public by misrepresenting that Impregon is its product.

ISSUE/S: Whether private respondent committed patent infringement to the prejudice of petitioner.

RULING: NO. 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. All that the claims disclose are: the covered invention, that is, the compound methyl 5 propylthio-2-benzimidazole carbamate; the compounds being anthelmintic but nontoxic for animals or its ability to destroy parasites without harming the host animals; and the patented methods, compositions or preparations involving the compound to maximize its efficacy against certain kinds of parasites infecting specified animals.

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. The mere absence of the word Albendazole in Letters Patent No. 14561 is not determinative of Albendazoles 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 petitioner’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 petitioner’s patent in spite of its omission therefrom or that the meaning of the claims of the patent embraces the same.

While petitioner concedes that the mere literal wordings of its patent cannot establish private respondent’s infringement, it urges this 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.

A scrutiny of petitioner’s evidence fails to convince this Court of the substantial sameness of petitioners 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. As stated early on, petitioners evidence fails to explain how Albendazole is in every essential detail identical to methyl 5 propylthio-2-benzimidazole carbamate.

SEHWANI INCORPORATED vs. IN-N-OUT BURGER, INC.

SEHWANI INCORPORATED vs. IN-N-OUT BURGER, INC.

G.R. No. 171053

October 15, 2007

YNARES-SANTIAGO, J.:

FACTS:

Respondent IN-N-OUT Burger, Inc., a foreign corporation (California, USA), and not doing business in the Philippines, filed before the Bureau of Legal Affairs of the IPO, an administrative complaint against petitioners Sehwani, Inc. and Benita’s Frites, Inc. for violation of intellectual property rights, attorney’s fees and damages with prayer for the issuance of a restraining order or writ of preliminary injunction.

Respondent, alleges that it is the owner of the tradename “IN-N-OUT” and trademarks “IN-N-OUT,” “IN-N-OUT Burger & Arrow Design” and “IN-N-OUT Burger Logo” which are used in its business since 1948 up to the present.  These tradename and trademarks were registered in the United States as well as in other parts of the world.  Petitioner Sehwani allegedly had obtained a trademark registration for the mark “IN N OUT” (with the inside letter O formed like a star) without its authority.

In their answer with counterclaim, petitioners alleged that respondent lack the legal capacity to sue because it was not doing business in the Philippines and that it has no cause of action because its mark is not registered or used in the Philippines. Petitioner Sehwani, Inc. also claimed that as the registered owner of the "IN-N-OUT" mark, it enjoys the presumption that the same was validly acquired and that it has the exclusive right to use the mark. Moreover, petitioners argued that other than the bare allegation of fraud in the registration of the mark, respondent failed to show the existence of any of the grounds for cancellation thereof under Section 151 of Republic Act (R.A.) No. 8293, otherwise known as The Intellectual Property Code of the Philippines.

The Bureau ruled in favor of In-N-Out and cancelled the registration of Shwani.

ISSUE/S:

1. Whether or not the Respondent has the legal capacity to sue for the protection of its trademarks albeit it is not doing business in the Philippines

2. Whether or not a ground exists for the cancellation of the Petitioners’ registration

RULING:

1. Yes. Section 160 RA No. 8293 provides for the right of foreign corporations to sue in trademark or service mark enforcement action, provided that it meets the requirements under Section 3 thereof, which are a) Any convention, treaty or agreement relation to intellectual property right or the repression of unfair competition wherein Philippines is also a party; and b) An extension therein of reciprocal rights.

Moreoever, Article 6 of The Paris Convention, which governs the protection of well-known trademarks, is a self-executing provision and does not require legislative enactment to give it effect in the member country.  The essential requirement therein is that the trademark must be well-known in the country where protection is sought.  In this case, Director Beltran-Abelardo found that In-n-out Burger and Arrow Design is an internationally well known mark as evidenced by its trademark registrations around the world and its comprehensive advertisements therein.

2. Yes. Section 151(b) of RA 8293 provides that a petition to cancel a registration of a mark 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 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 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 goods or services on or in connection with which the mark is used.  The evidence showed that not only did the petitioners use the IN-N-OUT Burger trademark for the name of their restaurant, but they also used identical or confusingly similar mark for their hamburger wrappers and French-fries receptacles, thereby effectively misrepresenting the source of the goods and services.

SAMSON V. DAWAY AND CATERPILLAR, INC.

SAMSON V. DAWAY AND CATERPILLAR, INC.

G.R. NO. 160054-55

DATE: July 21, 2004

PONENTE: YNARES-SANTIAGO

FACTS: Two informations for unfair competition were filed against Samson, the registered owner of ITTI shoes. The infomations state that Samson did then and there willfully, unlawfully and feloniously distribute, sell and/or offer for sale CATERPILLAR products such as footwear, garments, clothing, bags, accessories and paraphernalia which are closely identical to and/or colorable imitations of the authentic Caterpillar products and likewise using trademarks, symbols and/or designs as would cause confusion, mistake or deception on the part of the buying public to the damage and prejudice of CATERPILLAR, INC., the prior adopter, user and owner of the following internationally: “CATERPILLAR,” “CAT,” “CATERPILLAR & DESIGN,” “CAT AND DESIGN,” “WALKING MACHINES” and “TRACK-TYPE TRACTOR & DESIGN.”

Samson filed a motion to suspend the arraignment and other proceedings in view of the existence of an alleged prejudicial question involving a civil case for unfair competition pending with the same branch, and also in view of the pendency of a petition for review filed with the Secretary of Justice assailing the Chief State Prosecutor’s resolution finding probable cause to charge petitioner with unfair competition.

The TC judge denied the motion and arraignment ensued.  Thereafter, Samson filed a motion to quash the informations contending that since under Section 170 of R.A. No. 8293, the penalty of imprisonment for unfair competition does not exceed six years, the offense is cognizable by the Municipal Trial Courts and not by the Regional Trial Court, per R.A. No. 7691. The TC judge denied the motion. Hence, this petition for certiorari.

ISSUE/S:

1. Which court has jurisdiction over criminal and civil cases for violation of intellectual property rights?

2. Did the TC judge commit grave abuse of discretion when he refused to suspend the proceedings on the ground of existence of prejudicial question and a pending petition for review before the Sec. of Justice on the finding of probable cause for unfair competition?

RULING:

1. RTC. Under Section 170 of R.A. No. 8293, which took effect on January 1, 1998, the criminal penalty for infringement of registered marks, unfair competition, false designation of origin and false description or representation, is imprisonment from 2 to 5 years and a fine ranging from Fifty Thousand Pesos to Two Hundred Thousand Pesos. Corollarily, Section 163 of the same Code states that actions (including criminal and civil) under Sections 150, 155, 164, 166, 167, 168 and 169 shall be brought before the proper courts with appropriate jurisdiction under existing laws.

The existing law referred to in the foregoing provision is Section 27 of R.A. No. 166 (The Trademark Law) which provides that jurisdiction over cases for infringement of registered marks, unfair competition, false designation of origin and false description or representation, is lodged with the CFI (now RTC). We find no merit in the claim of Samson that R.A. No. 166 was expressly repealed by R.A. No. 8293. The use of the phrases “parts of Acts” and “inconsistent herewith” only means that the repeal pertains only to provisions which are repugnant or not susceptible of harmonization with R.A. No. 8293.7 Section 27 of R.A. No. 166, however, is consistent and in harmony with Section 163 of R.A. No. 8293. Had R.A. No. 8293 intended to vest jurisdiction over violations of intellectual property rights with the Metropolitan Trial Courts, it would have expressly stated so under Section 163 thereof.

Moreover, the settled rule in statutory construction is that in case of conflict between a general law and a special law, the latter must prevail. Jurisdiction conferred by a special law to Regional Trial Courts must prevail over that granted by a general law to Municipal Trial Courts. In the case at bar, R.A. No. 8293 and R.A. No. 166 are special laws conferring jurisdiction over violations of intellectual property rights to the Regional Trial Court. They should therefore prevail over R.A. No. 7691, which is a general law. Hence, jurisdiction over the instant criminal case for unfair competition is properly lodged with the Regional Trial Court even if the penalty therefor is imprisonment of less than 6 years, or from 2 to 5 years and a fine ranging from P50,000.00 to P200,000.00.

In fact, to implement and ensure the speedy disposition of cases involving violations of intellectual property rights under R.A. No. 8293, the Court issued A.M. No. 02-1-11-SC dated February 19, 2002 designating certain Regional Trial Courts as Intellectual Property Courts. On June 17, 2003, the Court further issued a Resolution consolidating jurisdiction to hear and decide Intellectual Property Code and Securities and Exchange Commission cases in specific Regional Trial Courts designated as Special Commercial Courts.

2. NO. Samson failed to substantiate his claim that there was a prejudicial question. He made no discussion in support of said prayer in his petition and reply to comment. Neither did he attach a copy of the complaint in Civil Case nor quote the pertinent portion thereof to prove the existence of a prejudicial question. At any rate, there is no prejudicial question if the civil and the criminal action can, according to law, proceed independently of each other.

In the case at bar, the common element in the acts constituting unfair competition under Section 168 of R.A. No. 8293 is fraud. Pursuant to Article 33 of the Civil Code, in cases of defamation, fraud, and physical injuries, a civil action for damages, entirely separate and distinct from the criminal action, may be brought by the injured party. Hence, Civil Case No. Q-00-41446, which as admitted by Caterpilar also relate to unfair competition, is an independent civil action under Article 33 of the Civil Code. As such, it will not operate as a prejudicial question that will justify the suspension of the criminal cases at bar.

While the pendency of a petition for review is a ground for suspension of the arraignment, the aforecited provision limits the deferment of the arraignment to a period of 60 days reckoned from the filing of the petition with the reviewing office. It follows, therefore, that after the expiration of said period, the trial court is bound to arraign the accused or to deny the motion to defer arraignment.

In the instant case, Samson failed to establish that respondent Judge abused his discretion in denying his motion to suspend. His pleadings and annexes submitted before the Court do not show the date of filing of the petition for review with the Secretary of Justice.15Moreover, the Order dated August 9, 2002 denying his motion to suspend was not appended to the petition. He thus failed to discharge the burden of proving that he was entitled to a suspension of his arraignment and that the questioned orders are contrary to Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure. Indeed, the age-old but familiar rule is that he who alleges must prove his allegations.