G.R. No. 118708.
February 2, 1998.
CRESER PRECISION SYSTEMS, INC., petitioner,
vs. COURT OF APPEALS AND FLORO INTERNATIONAL CORP., respondents.
D E C I S I O N
This petition for
review on certiorari assails the decision of the Court of Appeals dated
November 9, 1994 in C.A.-G.R. SP No. 34425 entitled "Floro International
Corp. vs. Hon. Tirso D.C. Cruz and Creser Precision System, Inc.", the
dispositive portion of which reads:
"WHEREFORE, THE PETITION IS HEREBY
GRANTED. THE COMPLAINT FOR INJUNCTION AND DAMAGES, CIVIL CASE NO. 93-1856
BEFORE THE RESPONDENT JUDGE IS HEREBY ORDERED DISMISSED AND HIS ORDERS THEREIN
OF DECEMBER 29, 1993 AND MAY 11, 1994 ARE ORDERED SET ASIDE."
Private
respondent is a domestic corporation engaged in the manufacture, production,
distribution and sale of military armaments, munitions, airmunitions and other
similar materials.
On January 23,
1990, private respondent was granted by the Bureau of Patents, Trademarks and
Technology Transfer (BPTTT), a Letters Patent No. UM-6938 covering an aerial
fuze which was published in the September-October 1990, Vol. III, No. 5 issue
of the Bureau of Patent's Official Gazette.
Sometime in
November 1993, private respondent, through its president, Mr. Gregory Floro,
Jr., discovered that petitioner submitted samples of its patented aerial
fuze to the Armed Forces of the Philippines (AFP) for testing. He learned
that petitioner was claiming the aforesaid aerial fuze as its own and
planning to bid and manufacture the same commercially without license or
authority from private respondent. To protect its right, private respondent on
December 3, 1993, sent a letter to petitioner advising it of its existing
patent and its rights thereunder, warning petitioner of a possible court action
and/or application for injunction, should it proceed with the scheduled testing
by the military on December 7, 1993.
In response to
private respondent's demand, petitioner filed on December 8, 1993 a complaint
for injunction and damages arising from the alleged infringement before the
Regional Trial Court of Quezon City, Branch 88. The complaint alleged, among
others: that petitioner is the first, true and actual inventor of an aerial
fuze denominated as "Fuze, PDR 77 CB4" which it developed as early as
December 1981 under the Self-Reliance Defense Posture Program (SRDP) of the
AFP; that sometime in 1986, petitioner began supplying the AFP with the said
aerial fuze; that private respondent's aerial fuze is identical in every
respect to the petitioner's fuze; and that the only difference between the two
fuzes are miniscule and merely cosmetic in nature. Petitioner prayed that a
temporary restraining order and/or writ of preliminary injunction be issued
enjoining private respondent including any and all persons acting on its behalf
from manufacturing, marketing and/or profiting therefrom, and/or from
performing any other act in connection therewith or tending to prejudice and
deprive it of any rights, privileges and benefits to which it is duly entitled
as the first, true and actual inventor of the aerial fuze.
On December 10,
1993, the trial court issued a temporary restraining order. Thereafter,
hearings were held on the application of petitioner for the issuance of a writ
of preliminary injunction, with both parties presenting their evidence. After
the hearings, the trial court directed the parties to submit their respective
memoranda in support of their positions.
On December 27,
1993, private respondent submitted its memorandum alleging that petitioner has
no cause of action to file a complaint for infringement against it since it has
no patent for the aerial fuze which it claims to have invented; that
petitioner's available remedy is to file a petition for cancellation of patent
before the Bureau of Patents; that private respondent as the patent holder
cannot be stripped of its property right over the patented aerial fuze
consisting of the exclusive right to manufacture, use and sell the same and
that it stands to suffer irreparable damage and injury if it is enjoined from
the exercise of its property rights over its patent.
On December 29,
1993, the trial court issued an Order granting the issuance of a writ of
preliminary injunction against private respondent the dispositive portion of
which reads:
"WHEREFORE, plaintiffs application for the
issuance of a writ of preliminary injunction is granted and, upon posting of
the corresponding bond by plaintiff in the amount of PHP 200,000.00, let the
writ of preliminary injunction be issued by the branch Clerk of this Court
enjoining the defendant and any and all persons acting on its behalf or by and
under its authority, from manufacturing, marketing and/or selling aerial fuzes
identical, to those of plaintiff and from profiting therefrom, and/or from
performing any other act in connection therewith until further orders from this
Court."
Private
respondent moved for reconsideration but this was denied by the trial court in
its Order of May 11, 1994, pertinent portions of which read:
"For resolution before this Court is the
Motion for Reconsideration filed by the defendant and the plaintiff's
Opposition thereto. The Court finds no sufficient cause to reconsider its order
dated December 29, 1993. During the hearing for the issuance of the preliminary
injunction, the plaintiff has amply proven its entitlement to the relief prayed
for. It is undisputed that the plaintiff has developed its aerial fuze way back
in 1981 while the defendant began manufacturing the same only in 1987. Thus, it
is only logical to conclude that it was the plaintiff's aerial fuze that was
copied or imitated which gives the plaintiff the right to have the defendant
enjoined "from manufacturing, marketing and/or selling aerial fuzes
identical to those of the plaintiff, and from profiting therefrom and/or
performing any other act in connection therewith until further orders from this
Court." With regards to the defendant's assertion that an action for
infringement may only be brought by "anyone possessing right, title or
interest to the patented invention," (Section 42, RA 165) qualified
by Sec. 10, RA 165 to include only "the first true and actual
inventor, his heirs, legal representatives or assignees, " this court
finds the foregoing to be untenable. Sec. 10 merely enumerates the persons who
may have an invention patented which does not necessarily limit to these
persons the right to institute an action for infringement. Defendant further
contends that the order in issue is disruptive of the status quo. On the
contrary, the order issued by the Court in effect maintained the status quo.
The last actual, peaceable uncontested status existing prior to this
controversy was the plaintiff manufacturing and selling its own aerial fuzes
PDR 77 CB4 which was ordered stopped through the defendant's letter. With the
issuance of the order, the operations of the plaintiff continue. Lastly, this
court believes that the defendant will not suffer irreparable injury by virtue
of said order. The defendant's claim is primarily hinged on its patent (Letters
Patent No. UM-6983) the validity of which is being questioned in this case.
WHEREFORE, premises considered, the Motion for
Reconsideration is hereby denied for lack of merit.
SO ORDERED."
Aggrieved,
private respondent on June 27, 1994, filed a petition for certiorari, mandamus
and prohibition before respondent Court of Appeals raising as grounds the
following:
a. Petitioner has no cause of action for
infringement against private respondent, the latter not having any patent for
the aerial fuze which it claims to have invented and developed and allegedly
infringed by private respondent;
b. the case being an action for
cancellation or invalidation of private respondent's Letters Patent over its
own aerial fuze, the proper venue is the Office of the Director of Patents;
c. The trial court acted in grave abuse of
discretion and/or in excess of jurisdiction in finding that petitioner has
fully established its clear title or right to preliminary injunction;
d. The trial court acted in grave abuse of
discretion and/or in excess of jurisdiction in granting the preliminary
injunction, it being disruptive of the status quo; and
e. The trial court acted in grave abuse of
discretion and/or in excess of jurisdiction in granting the preliminary
injunction thereby depriving private respondent of its property rights over the
patented aerial fuze and cause it irreparable damages.
On November 9,
1994, the respondent court rendered the now assailed decision reversing the
trial court's Order of December 29, 1993 and dismissing the complaint filed by
petitioner.
The motion for
reconsideration was also denied on January 17, 1995. Hence, this present
petition.
It is
petitioner's contention that it can file, under Section 42 of the Patent Law (R.A.
165), an action for infringement not as a patentee but as an entity in
possession of a right, title or interest in and to the patented invention. It
advances the theory that while the absence of a patent may prevent one from
lawfully suing another for infringement of said patent, such absence does not
bar the first true and actual inventor of the patented invention from suing
another who was granted a patent in a suit for declaratory or injunctive relief
recognized under American patent laws. This remedy, petitioner points out, may
be likened to a civil action for infringement under Section 42 of the
Philippine Patent Law.
We find the above
arguments untenable.
Section 42 of R.A.
165, otherwise known as the Patent Law, explicitly provides:
SEC. 42. Civil action for infringement.
— Any patentee, or anyone possessing any right, title or interest in and to the
patented invention, whose rights have been infringed, may bring a civil action
before the proper Court of First Instance (now Regional Trial court), to
recover from the infringer damages sustained by reason of the infringement and
to secure an injunction for the protection of his right. . .
Under the
aforequoted law, only the patentee or his successors-in-interest may file an
action for infringement. The phrase "anyone possessing any right, title
or interest in and to the patented invention" upon which petitioner
maintains its present suit, refers only to the patentee's
successors-in-interest, assignees or grantees since actions for infringement of
patent may be brought in the name of the person or persons interested, whether
as patentee, assignees, or as grantees, of the exclusive right. Moreover, there
can be no infringement of a patent until a patent has been issued, since
whatever right one has to the invention covered by the patent arises alone from
the grant of patent. In short, a person or entity who has not been granted
letters patent over an invention and has not acquired any right or title
thereto either as assignee or as licensee, has no cause of action for
infringement because the right to maintain an infringement suit depends on the
existence of the patent.
Petitioner admits
it has no patent over its aerial fuze. Therefore, it has no legal basis
or cause of action to institute the petition for injunction and damages arising
from the alleged infringement by private respondent. While petitioner claims to
be the first inventor of the aerial fuze, still it has no right of
property over the same upon which it can maintain a suit unless it obtains a
patent therefor. Under American jurisprudence, an inventor has no common-law
right to a monopoly of his invention. He has the right to make, use and vend
his own invention, but if he voluntarily discloses it, such as by offering it
for sale, the world is free to copy and use it with impunity. A patent,
however, gives the inventor the right to exclude all others. As a patentee, he
has the exclusive right of making, using or selling the invention.
Further, the
remedy of declaratory judgment or injunctive suit on patent invalidity relied
upon by petitioner cannot be likened to the civil action for infringement under
Section 42 of the Patent Law. The reason for this is that the said remedy is
available only to the patent holder or his successors-in-interest. Thus, anyone
who has no patent over an invention but claims to have a right or interest
thereto cannot file an action for declaratory judgment or injunctive suit which
is not recognized in this jurisdiction. Said person, however, is not left
without any remedy. He can, under Section 28 of the aforementioned law, file a
petition for cancellation of the patent within three (3) years from the
publication of said patent with the Director of Patents and raise as ground
therefor that the person to whom the patent was issued is not the true and
actual inventor. Hence, petitioner's remedy is not to file an action for
injunction or infringement but to file a petition for cancellation of private
respondent's patent. Petitioner however failed to do so. As such, it cannot now
assail or impugn the validity of the private respondent's letters patent by
claiming that it is the true and actual inventor of the aerial fuze.
Thus, as
correctly ruled by the respondent Court of Appeals in its assailed decision:
"since the petitioner (private respondent herein) is the patentee of
the disputed invention embraced by letters of patent UM No. 6938 issued
to it on January 23, 1990 by the Bureau of Patents, it has in its favor not
only the presumption of validity of its patent, but that of a legal and factual
first and true inventor of the invention."
In the case of
Aguas vs. De Leon, we stated that:
"The validity of the patent issued by the
Philippine Patent Office in favor of the private respondent and the question
over the investments, novelty and usefulness of the improved process therein
specified and described are matters which are better determined by the
Philippines Patent Office. The technical Staff of the Philippines Patent
Office, composed of experts in their field, have, by the issuance of the patent
in question, accepted the thinness of the private respondent's new tiles as a
discovery. There is a presumption that the Philippine Patent Office has
correctly determined the patentability of the improvement by the private
respondent of the process in question."
In fine, in the
absence of error or abuse of power or lack of jurisdiction or grave abuse of
discretion, we sustain the assailed decision of the respondent Court of Appeal.
WHEREFORE, the
decision of the Court of Appeals is hereby AFFIRMED. No pronouncement as to
costs.