Geographical Indications, in general

TRIPS Agreement definition: - Those indications which identify a good as originating in the territory of a Member, or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographic origin. A geographical indication should show the link between some characteristic of the good and the particular region where it was produced. Example: the Florida Sunshine Tree is a symbol known to consumers that links citrus products featuring the Sunshine Tree to Florida, where distinctive-tasting citrus is grown. (US PTO, supra at note 1.)

Geographical indications serve as quality indicators of goods and services, are widely used by producers, distributors and retailers as an advertising or promotional tool to attract consumers and investors.

Geographical Indications - Philippine Setting

Similar to experiences in other states, there appears to be a positive correlation between:

(a) the value of the commodity, in terms of profitability or viability; and

(b) the protection accorded to geographical indications associated with said commodity, in the Philippines.

Philippine IP Code: In compliance with the TRIPS Agreement, the Philippine Congress included geographical indications in the enumeration of recognized forms of intellectual property rights, as shown in Section 4 of the Intellectual Property Code (the IP Code). Strangely, the remaining provisions of the IP Code do not make further, express reference to geographical indications. In fact, the IP Code does not even define what is a geographical indication for purposes of Philippine law.

While the IP Code does not provide a legal framework specific to the registration and enforcement of rights relating to, or arising from geographical indications, it does extend some protection to geographical indications:

a. Geographical indications per se cannot be registered as trademarks under Section 123: A mark cannot be registered if it: geographical origin, time or production of the goods or rendering of the services, or other characteristics of the goods or services;

b. A person who commits any act or omission constituting misrepresentation as to the geographical origin of a particular good may be held criminally and civilly liable therefore, to wit: Sec. 169. False Designations of Origin; False Description or Representation.

c. The IP Code considers goods containing false or misleading designations of origin to be contraband, and prohibits their importation into the Philippines,

d. The IP Code allows for the registration of collective marks. Rule 100 of the Trademark Rules defines collective marks

While the IP Code does not treat geographical indications as sui generis forms of intellectual property, the same may be protected and registered as collective marks. Interested parties may thus register geographic indications as collective marks with the IPOPHL

PHILIPPINE PLANT VARIETY PROTECTION ACT OF 2002 Republic Act (R.A.) No. 9168, which was enacted in 2002, established a certification system to protect newly-discovered, bred or cultivated plant varieties. Under this Act, the National Plant Variety Protection Board (NPVPB) may issue a Certificate of Plant Variety Protection to plant varieties that are new, distinct, uniform and stable (the Certificate). Holders of a Certificate shall have the right to authorize the:

(i) production or reproduction of the covered plant variety;

(ii) conditioning the covered plant variety for the purpose of propagation;

(iii) offering the covered plant variety for sale;

(iv) selling or other marketing of the covered plant variety;

(v) exporting or importing the covered plant variety; and

(vi) stocking the covered plant variety.

While the certification system provided by R.A. No. 9168 is arguably similar to the framework adopted by the EU, Mexico and Indonesia, the same applies expressly to plant varieties, and do not cover geographical indications.

Matters for Consideration:

Philippine intellectual property law recognizes that geographical indications are forms of intellectual property, and prohibits the misuse thereof through unfair competition clauses in the IP Code. However, the Code does not consider geographical indications to be sui generis, nor does it provide for them an independent system of protection.

The lack of a sui generis framework in the IP Code or under other Philippine laws for that matter, may be based on the following:

Philippine exporters rely very little, if at all, on geographical indications to promote their products to consumers. The Philippine government apparently takes action with regard to geographical indications only when use of the same will harm the countrys highly-valued commodities. The Philippines imports usually exceed its exports which may have likewise inhibited the development of geographical indications in the Philippines

Republic Act No. 9150 entitled 'An Act for the Protection of Layout-Designs (Topographies) of Integrated Circuits, Amending for the Purpose Certain Sections of Republic Act No. 8293, otherwise known as the Intellectual Property Code of the Philippines and for other purposes' March 15, 2002

"1. An Industrial Design is any composition of lines or colors or any three-dimensional form, whether or not associated with lines or colors: Provided, That such composition or form gives a special appearance to and can serve as pattern for an industrial product or handicraft.

"2. Integrated Circuit means a product, in its final form, or an intermediate form, in which the elements, at least one of which is an active element and some or all of the interconnections are integrally formed in and/or on a piece of material, and which is intended to perform an electronic function; and

"3. Layout-Design is synonymous With 'Topography' and means the three-dimensional disposition, however expressed, of the elements, at least one of which is an active element, and of some or all of the interconnections of an integrated circuit, or such a three-dimensional disposition prepared for an integrated circuit intended for manufacture.

"Sec. 113. Substantive Conditions/or Protection. - 113.1. Only industrial designs that are new or ornamental shall benefit from protection under this Act.

"113.2. Industrial designs dictated essentially by technical or functional considerations to obtain a technical result or those that are contrary to public order, health or morals shall not be protected.

"113.3. Only layout -designs of integrated circuits that are original shall benefit from protection under this Act. A layout-design shall be considered original if it is the result of its creator's own intellectual effort and is not commonplace among creators of layout-designs and manufacturers of integrated circuits at the time of its creation.

"113.4. A layout-design consisting of a combination of elements and interconnections that are commonplace shall be protected only if the combination, taken as a whole, is original."

"119.4. Rights Conferred to the Owner of a Layout-Design Registration. - The owner of a layout-design registration shall enjoy the following rights:

"(1) to reproduce, whether by incorporation in an integrated circuit or otherwise, the registered layout-design in its entirety or any part thereof, except the act of reproducing any part that does not comply with the requirement of originality; and

"(2) to sell or otherwise distribute for commercial purposes the registered layout design, an article or an integrated circuit in which the registered layout-design is incorporated.

Are trade secrets and undisclosed information protected under Philippine law?

The 1987 Philippine Constitution provide in its Article III or in its Bill of Rights Section 1 that no person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws.

In the Philippines, the most particular law that protects trade secrets and undisclosed information is the Republic Act No. 8293 otherwise known as Intellectual Property Code of the Philippines (IP Code).

Section 4 of the Philippine Intellectual Property Code (IP Code) recognizes that the term intellectual-property rights includes the protection of undisclosed information, however, the law does not provide for any specific provision protecting undisclosed information or trade secrets just a provision that requires courts to adopt measures to protect the manufacturing and business secrets of the defendant in a patent infringement case.

Primarily, Trade secret is recognized under the Philippine Laws as a privilege in nature. This is apparent from the following laws:

Securities Regulation Code of 2000, sec. 66.2, that provides that the revelation of trade secrets or processes in any application, report or document filed with the Securities and Exchange Commission is not required.

Tax Reform Act of 1997 (the NIRC), section 278, penalizes the revelation of trade secrets by internal revenue officers or employees.

Toxic Substances and Hazardous and Nuclear Wastes Control Act of 1990 (R.A. 6969),sec. 12, limits the right of the public to have access to records, reports or information concerning chemical substances and mixtures if the matter is confidential such that it would divulge trade secrets. Interim Rules Governing Corporate Rehabilitation, Rule 3, sec. 4, On provide that courts may issue an order to protect trade secrets or other confidential research, development, or commercial information belonging to the debtor.

Also, Trade secrets is defined by the Supreme Court ruling from the case of Air Philippines Corp. v. Pennswell Inc., G.R. 172835, 13 December 2007, that adopted the following definition of the term in Blacks Law Dictionary:

A trade secret is defined as a plan or process, tool, mechanism or compound known only to its owner and those of his employees to whom it is necessary to confide it.

The ruling also stated that trade secrets also extends to a secret formula or process not patented, but known only to certain individuals using it in compounding some article of trade having a commercial value.

In violation of these laws, Article 292 of the Revised Penal Code provides that revealing the industrial or trade secrets of an employer by an employee is a crime. However, this criminal provision is weak as a compelling force to deter the revelation of trade secrets by employees because of lack of jurisprudence and fir this reason, company seeking to protect its trade secrets in the Philippines to resort to contractual law.

May an employer company lawfully enforce a policy and contract that prohibits employees from entering into a relationship with competitor companies?Businesses first line of defense of their trade secrets: employment contracts.

The Labor Code prohibits certain terms or conditions of employment to be stipulated on employment contracts. Any such stipulation, even if freely and voluntarily agreed upon by the parties, is void. For example, the prospective employer and employee may not validly agree that the latter shall be paid a salary below the minimum wage prescribed by law, or that the employee shall be required to work more than 8 hours per day without overtime pay. Such stipulation, even if mutually consented to by the parties is null and without force and effect.

Nonetheless, Philippine laws recognize the right of enterprises to adopt and enforce policies to protect its right to reasonable returns on investments and to expansion and growth. Trade secrets being integral to a business, it cannot be overemphasized that employment contracts and written company policies serve as critical deterrents against the revelation of trade secrets by an employee.

The Non- Involvement clause in a contract is a protection of trade secret. A business entity is only as good as its human resources. This is the reason why companies invest in trainings and seminars for their employees. This is also one of the reasons why employers provide for non-competition clause to prevent their employees from working with a competitor or engaging in a similar business within a certain period.

The Supreme Court has, in fact, upheld the validity of a company policy prohibiting employees from entering into a relationship with an employee of a competitor company. In Duncan Association of Detailman-PTGWO v. Glaxo Wellcome, G.R. No. 162994, 17 September 2004, the Supreme Court upheld a contractual prohibition prohibiting employees from maintaining personal or marital relationships with employees of other competitor companies. The Supreme Court held that this was a reasonable contractual prohibition because a company has a right to guard its trade secrets, manufacturing formulas, marketing strategies and other confidential programs and information from competitors, especially as against rival companies in a highly competitive industry.

In Daisy Tiu v. Platinum Plans, Inc., G.R. No. 163512, February 28, 2007, the Supreme Court held that a non-involvement clause is not necessarily void for being in restraint of trade as long as there are reasonable limitations as to time, trade, and place. In contracts, Article 1306 of the Civil Code the parties may establish such stipulations, clauses, terms and conditions as they may deem convenient, provided they are not contrary to law, morals, good customs, public order, or public policy. The obligations arising from contracts, Article 1159 of the Civil Code, have the force of law between the contracting parties and should be complied with in good faith.

Salient Provisions of RA 7459 The Philippine Inventors and Invention Incentives Act April 28, 1992

The 2005 Implementing Rules & Regulations of R.A. No. 7459, otherwise known as the Inventors & Invention Incentives Act of the Philippines

Cash Rewards. Presidential awards for inventions consisting of Cash Rewards shall be granted to patented inventions in the Philippines to be chosen by a Screening Committee (Section 4) with members consisting of technical representatives from the Department of Science and Technology (DOST), the Filipino Inventors Society, the Department of Trade and Industry (DTI), the Department of Agriculture, and the Department of Environment and Natural Resources (Section 3.1.1, IRR of R.A. 7459). There shall be four categories with the corresponding cash rewards as follows: (Section 4)

1. Inventions. (i) First Prize, One hundred thousand pesos (P100,000.00): (ii) Second prize, Fifty thousand pesos (P50,000.00); and (iii) Third prize, Twenty thousand pesos (P20,000.00);

2. Utility Models. (i) First Prize, Fifty thousand pesos (P50,000.00); (ii) Second prize, Twenty thousand pesos (P20,000.00); and (iii) Third prize, Ten thousand pesos (P10,000.00);

3. Industrial Design. (i) First Prize, Fifty thousand pesos (P50,000.00); (ii) Second Prize, Twenty thousand pesos (P20,000.00); and (iii) Third prize, Ten thousand pesos (P10,000.00);

4. Creative Research, (i) First prize, Twenty thousand pesos (P20,000.00); (ii) Second Prize, Ten thousand pesos (P10,000.00); and (iii) Third prize, Five thousand pesos (P5,000.00);

A round-trip ticket fare in addition to necessary and reasonable expenses but not more than three hundred pesos (P300.00) a day shall be provided to all provincial awardees. Upon recommendation of the Screening Committee, all winners may be sent by the Philippine Government to other countries where their winning inventions or areas of interest are advanced. The Screening Committee may adjust the cash awards and the additional expenses aforecited subject to the approval of the Institute.

Tax incentivesare provided to inventors who shall be exempt from payment of license fees, permit fees, and other business taxes in the development of the invention. However, the Inventor must be certified by the Filipino Inventors Society and duly confirmed by the Screening Committee to avail these incentives (Section 5).

Tax exemptionis provided to any income derived from commercialization of technologies developed by local researchers or adapted locally from foreign sources including inventions, during the first ten years from the date of the first sale, subject to the rules and regulations of the Department of Finance. This tax exemption privilege pertaining to invention shall be extended to the legal heir or assignee upon the death of the inventor. Moreover, the technologies, their manufacture or sale, shall also be exempt from payment of license, permit fees, customs duties and charges on imports (Section 6).

Inventions Development Assistance Fund (IDAF)is established from the operations of the Technology Application and Promotion Institute (TAPI) of the DOST. The IDAF, which is at least twelve percent (12%) of the annual operations fund of the Institute and from donations, bequests, and other sources, public, private or domestic or foreign, for assisting potential or actual inventors in the initial experiments and prototype development and other inventor-development related activities of invention or innovation, shall be administered by TAPI. Donations to the IDAF shall be tax exempt or tax deductible (Section 7).

Invention Guarantee Fund (IGF), which was created by Republic Act No. 3850, as amended, deposited with the Development Bank of the Philippines (DBP), and the interest earnings thereof, shall be made available to finance and guarantee the loan assistance of any patented Filipino invention duly certified by the Filipino Inventors Society and by the Screening Committee (Section 9).

Financial and Loan Assistance from Government Banks.Loan assistance for the commercial production of an invention, either locally or for export and duly certified by the Filipino Inventors Society and the Screening Committee, shall be extended by government banks. However, the said invention must meet the criteria that would enhance the economy of the country such as profitability and viability, dollar-earning capacity, and generation of employment opportunities for Filipinos (Section 10).

Government Agencies Assistance.To facilitate the granting of loans or financial assistance by any government bank, all government agencies concerned are required to extend all possible assistance, such as the use of its facilities in the preparation of project feasibility studies and evaluations and products to be produced by the inventor (Section 11).

Expanded Functions of the TAPI.Section 8 of R.A. 7439 provided the following additional functions to the TAPI in order to carry out its provisions.

(a)Assist technologies, inventors and researches, avail of the laboratories and other facilities of the RDI's including regional offices and other government agencies, offices and instrumentalities upon recommendation of the Director of the Institute: Provided, That the receipt of such assistance agree to give to the Institute at least one-tenth (1/10) of all royalties arising from the technology or invention depending upon the extent of facility or services utilized to help maintain the research laboratories; and(b)Accredit and recognize inventor organization throughout their activities.

ConclusionThe Inventors and Invention Incentives Act is the countrys prime law that recognizes the significant contribution of our inventors and researchers. The law promotes and supports the welfare of the countrys critical mass of scientific workforce and human capital through the provision of technical and administrative assistance from TAPI and other government agencies as well as giving financial support. These may motivate inventors to pursue their research and create something useful for the country. However, considering the high cost of raw materials to conduct research and develop inventions, researchers, scientists and inventors are confronted with financial issues and may be tempted or forced to sell their inventions to non-Filipino investors who offer higher values for these inventions. This calls for increased government support to Filipino inventors. At present, Senate Bill No. 682 which was filed on July 9, 2013, introduced by Senator Loren B. Legarda, calls for the creation of the Philippine Inventors Commission (re-establishment as provided by R.A. No. 3850). The Senate Bill aims to strengthen the mechanisms for providing the much needed support of the countrys inventors. Specifically, the bill will provide technical, financial, legal and marketing assistance to Filipino inventors and their inventions.

Laws Concerning promotion of science and technology1. REPUBLIC ACT 9107 AN ACT PROMOTING AND PRESERVING THE SCIENCE AND TECHNOLOGY RESOURCES OF THE COUNTRY ESTABLISHING FOR THIS PURPOSE THE PHILIPPINE SCIENCE HERITAGE CENTER, APPROPRIATING FUNDS THEREFOR AND FOR OTHER PURPOSES

Sec. 3. Philippine Science Heritage Center. - There is hereby created a Philippine Science Heritage Center, hereinafter referred to as the "Center", which shall be managed, operated and maintained by the National Academy of Science and Technology (NAST). The Center shall be the main repository of the country's contributions, achievements and accomplishments in the field of science and technology.chanrobles

2. RA No. 2067 AN ACT TO INTEGRATE, COORDINATE, AND INTENSIFY SCIENTIFIC AND TECHNOLOGICAL RESEARCH AND DEVELOPMENT AND TO FOSTER INVENTION; TO PROVIDE FUNDS THEREFOR; AND FOR OTHER PURPOSES.

Section 2. In consonance with the provisions of section four, Article XIV of the Constitution, it is hereby declared to be the policy of the state to promote scientific and technological research and development, foster invention, and utilize scientific knowledge as an effective instrument for the promotion of national progress.

WHAT IS TECHNOLOGY TRANSFER ARRANGEMENT?

Technology Transfer Arrangement refers to contracts or agreements, including renewals thereof, involving the transfer of systematic knowledge for the manufacture of a product, the application of a process, or rendering of a service including management contracts; and the transfer, assignment or licensing of all forms of intellectual property rights, including licensing of computer software except computer software developed for mass market.

The signing of Republic Act 8293, otherwise known as the Intellectual Property (IP) Code, on June 6, 1997 liberalizes regulations on technology transfer registration particularly the rate of fees or royalties and strengthens intellectual property rights protection in the Philippines. Voluntary Licensing has been provided by the Code. Recordal with the IP Philippines of agreements that involve transmission of rights is necessary. However, registration is no longer required where the agreement is in conformity of the requirements of the law under Sections 87 and 88. Section 87 of the IP Code covers the prohibited clauses which are adverse to competition and trade.

Prohibited Clauses (Section 87, IP Code)

Those which impose upon the licensee the obligation to acquire from a specific source capital goods, intermediate products, raw materials, and other technologies, or of permanently employing personnel indicated by the licensor;

Those pursuant to which the licensee reserves the right to fix the sale or resale prices of the products manufactured on the basis of the license;

Those that contain restrictions regarding the volume and structure of production;

Those that prohibit the use of competitive technologies in a non-exclusive technology transfer arrangement;

Those that establish full or partial purchase option in favor of the licensor;

Those that obligate the licensee to transfer for free to the licensor the inventions or improvements that may be obtained through the use of the licensed technology;

Those that require payment of royalties to the owners of patents for patents which are not used;

Those that prohibit the licensee to export the licensed product unless justified for the protection of the legitimate interest of the licensor such as exports to countries where exclusive licenses to manufacture and/or distribute the licensed product(s) have already been granted;

Those which restrict the use of the technology supplied after the expiration of the technology transfer arrangement, except in cases of early termination of the technology transfer arrangement due to reason(s) attributable to the licensee;

Those which require payments for patents and other industrial property rights after their expiration or termination of the technology transfer arrangement;

Those which require that the technology recipient shall not contest the validity of any of the patents of the technology supplier;

Those which restrict the research and development activities of the licensee designed to absorb and adapt the transferred technology to local conditions or to initiate research and development programs in connection with new products, processes or equipment;

Those which prevent the licensee from adapting the imported technology to local conditions, or introducing innovation to it, as long as it does not impair the standards prescribed by the licensor; and

Those which exempt the licensor from liability for non-fulfillment of his responsibilities under the technology transfer arrangement and/or liability arising from third party suits brought about by the use of the licensed product or the licensed technology.

On the other hand, Section 88 of the IP Code contains provisions which need to be included in voluntary license agreement as follows:

That the laws of the Philippines shall govern the interpretation of the agreement and in the event of litigation, the venue shall be the proper court in the place where the licensee has its principal office;

Continued access to improvements in techniques and processes related to the technology shall be made available during the period of the technology transfer arrangement;

In the event the technology transfer arrangement shall provide for arbitration, the Procedure of Arbitration of the Arbitration Law of the Philippines or the Arbitration Law of the United Nations Commission on International Trade Law (UNCITRAL) or the Rules of Conciliation and Arbitration of the International Chamber of Commerce shall apply and the venue of arbitration shall be the Philippines or any neutral country; and

The Philippine taxes on all payments relating to the technology transfer arrangement shall be borne by the licensor.The terms and conditions of a TTA should be consistent with the provisions of the Intellectual Property Code on mandatory and prohibited clauses. Otherwise, the agreement will be unenforceable. The Intellectual Property Office (IPO) has the authority to determine whether a TTA is consistent with those clauses. To confirm compliance with the TTA regulations, a draft of a TTA may be submitted to the IPO for pre-clearance on a no-names basis. Under the pre-clearance procedure, the IPO will review the agreement, confirm that it is (or is not) a TTA, and identify the provisions which should be deleted, added or revised, if there are any. It usually takes around 7 to 10 business days for the IPO to issue its findings. The advantage of going through the pre-clearance process is that it allows the contracting parties to be certain prior to execution that the agreement is not defective under the TTA regulations.

Trademark Licenses

Although trademark licenses fall under the definition of TTAs, special rules apply to the recordation of trademark licenses with the Intellectual Property Office. A trademark license may be recorded against an existing registration or a pending application. In order to be acceptable for recordal, the license should:

provide for effective control by the licensor on the quality of the goods or services of the licensee in connection with which the mark is used

comply with the provisions of the IP Code on mandatory and prohibited clauses relating to TTAs

be signed by both parties, notarized and, if executed outside the Philippines, legalized/authenticated.

The IPO's Bureau of Trademarks will refer a trademark license contract submitted for recordal to the IPO's Documentation, Information and Technology Transfer Bureau (DITTB) for clearance. The Bureau of Trademarks will record a trademark license only upon the issuance by the DITTB of a certificate that the trademark license complies with the provisions of the IP Code on prohibited and mandatory clauses.

Franchising

Franchise agreements come within the description of TTAs. Franchising is regulated only to the extent that the contract clauses of franchise agreements are required to be consistent with technology transfer regulations. There are currently no Philippine laws or regulations that specifically impose disclosure and offering requirements on prospective franchisors.

A franchising agreement that is consistent with the provisions of the Intellectual Property Code on mandatory and prohibited clauses need not be registered with the IPO.

TANADA VS. ANGARA

Facts:

This is a petition seeking to nullify the Philippine ratification of the World Trade Organization (WTO) Agreement. Petitioners question the concurrence of herein respondents acting in their capacities as Senators via signing the said agreement.

The WTO opens access to foreign markets, especially its major trading partners, through the reduction of tariffs on its exports, particularly agricultural and industrial products. Thus, provides new opportunities for the service sector cost and uncertainty associated with exporting and more investment in the country. These are the predicted benefits as reflected in the agreement and as viewed by the signatory Senators, a free market espoused by WTO.

Petitioners on the other hand viewed the WTO agreement as one that limits, restricts and impair Philippine economic sovereignty and legislative power. That the Filipino First policy of the Constitution was taken for granted as it gives foreign trading intervention.

Issue:

Whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of the Senate in giving its concurrence of the said WTO agreement.Ruling:

In its Declaration of Principles and state policies, the Constitution adopts the generally accepted principles of international law as part of the law of the land, and adheres to the policy of peace, equality, justice, freedom, cooperation and amity , with all nations. By the doctrine of incorporation, the country is bound by generally accepted principles of international law, which are considered automatically part of our own laws. Pacta sunt servanda international agreements must be performed in good faith. A treaty is not a mere moral obligation but creates a legally binding obligation on the parties.

Through WTO the sovereignty of the state cannot in fact and reality be considered as absolute because it is a regulation of commercial relations among nations. Such as when Philippines joined the United Nations (UN) it consented to restrict its sovereignty right under the concept of sovereignty as autolimitation. What Senate did was a valid exercise of authority. As to determine whether such exercise is wise, beneficial or viable is outside the realm of judicial inquiry and review. The act of signing the said agreement is not a legislative restriction as WTO allows withdrawal of membership should this be the political desire of a member. Also, it should not be viewed as a limitation of economic sovereignty. WTO remains as the only viable structure for multilateral trading and the veritable forum for the development of international trade law. Its alternative is isolation, stagnation if not economic self-destruction. Thus, the people be allowed, through their duly elected officers, make their free choice.

Petition is DISMISSED for lack of merit.

Taada vs. Angara, G.R. No. 118295, May 2, 1997

The Philippines joined WTO as a founding member with the goal, as articulated by President Fidel V. Ramos in two letters to the Senate of improving "Philippine access to foreign markets, especially its major trading partners, through the reduction of tariffs on its exports, particularly agricultural and industrial products." The President also saw in the WTO the opening of "new opportunities for the services sector . . . , (the reduction of) costs and uncertainty associated with exporting . . . , and (the attraction of) more investments into the country." Although the Chief Executive did not expressly mention it in his letter, the Philippines and this is of special interest to the legal profession will benefit from the WTO system of dispute settlement by judicial adjudication through the independent WTO settlement bodies called (1) Dispute Settlement Panels and (2) Appellate Tribunal. Heretofore, trade disputes were settled mainly through negotiations where solutions were arrived at frequently on the basis of relative bargaining strengths, and where naturally, weak and underdeveloped countries were at a disadvantage.

MIRPURI VS. COURT OF APPEALS

Facts:

In 1970, Escobar filed an application with the Bureau of Patents for the registration of the trademark Barbizon for use in horsiers and ladies undergarments (IPC No. 686). Private respondent reported Barbizon Corporation, a corporation organized and doing business under the laws of New York, USA, opposed the application. It was alleged that its trademark is confusingly similar with that of Escobar and that the registration of the said trademark will cause damage to its business reputation and goodwill. In 1974, the Director of Patents gave due course to the application. Escobar later assigned all his rights and interest over the trademark to petitioner. In 1979, Escobar failed to file with the Bureau the affidavit of use of the trademark required under the Philippine Trademark Law. Due to this failure, the Bureau cancelled Escobars certificate of registration. In 1981, Escobar and petitioner separately filed this application for registration of the same trademark. (IPC 2049). Private respondent opposed again. This time it alleged (1) that the said trademark was registered with the US Patent Office; (2) that it is entitled to protection as well-known mark under Article 6 bis of the Paris Convention, EO 913 and the two Memoranda of the Minister of Trade and Industry and (3) that its use on the same class of goods amounts to a violation of the Trademark Law and Art. 189 of the RPC. Petitioner raised the defense of Res Judicata.

Issue:

One of the requisites of res judicata is identical causes of action. Do IPC No. 686 and IPC No. 2049 involve the same cause of action?

Ruling:

No. The issue of ownership of the trademark was not raised in IPC 686. IPC 2049 raised the issue of ownership, the first registration and use of the trademark in the US and other countries, and the international recognition of the trademark established by extensive use and advertisement of respondents products for over 40 years here and abroad. These are different from the issues of confessing similarity and damage in IPC 686. The issue of prior use may have been raised in IPC 686 but this claim was limited to prior use in the Philippines only. Prior use in IPC 2049 stems from the respondents claims originator of the word and symbol Barbizon, as the first and registered user of the mark attached to its products which have been sold and advertised would arise for a considerable number of years prior to petitioners first application. Indeed, these are substantial allegations that raised new issues and necessarily gave respondents a new cause of action.

Moreover, the cancellation of petitioners certificate registration for failure to file the affidavit of use arose after IPC 686. This gave respondent another cause to oppose the second application.

It is also to be noted that the oppositions in the first and second cases are based on different laws. Causes of action which are distinct and independent from each other, although out of the same contract, transaction, or state of facts, may be sued on separately, recovery on one being no bar to subsequent actions on others. The mere fact that the same relief is sought in the subsequent action will not render the judgment in the prior action operating as res judicata, such as where the actions are based on different statutes.