Maguan vs. Court of Appeals

No. L-45101. November 28, 1986

FACTS: 

Rosario Maguan,  is doing business under the firm name and style of “SWAN MANUFACTURING”, is a patent holder of powder puff. Maguan informed and ordered Susana Luchan, that the powder puffs she is manufacturing and selling are substantially identical of her. She explained such production and sale constitute infringement of said patents and therefore its immediate discontinuance is demanded, otherwise it will be compelled to take judicial action.

Luchan stated that her products are not identical, or even if substantially identical, by way of affirmative defenses, further alleged that Maguan’s patents in question are void on the following grounds: (1) at the time of filing of application for the patents involved, the utility models applied for were not new and patentable  since it existed and were publicly known and used as early as 1963  and (2) the person to whom the patents were issued was not the true and actual author of the utility models applied for, and neither did she derive her rights from any true and actual author of these utility models.

Maguan filed a complaint for infringing the aforesaid letters patent, and prayed, among others, that a writ of preliminary injunction be immediately issued with CFI – Rizal. 

The trial court granted the preliminary injunction prayed for by Maguan. 

Luchan questioned the propriety of the trial court’s issuance of the Writ of Preliminary Injunction arguing that since there is still a pending cancellation proceedings before the Philippine Patent Office concerning Maguan’s patents, such cannot be the basis for preliminary injunction

The Court of Appeals gave weight to Luchan’s allegation that the latter’s products are not identical or even only substantially identical to the products covered by petitioner’s patents.

ISSUES:

(1) Whether or not the preliminary injunction is correctly granted.

NO. In actions for patent infringement a writ of injunction will not issue unless the validity of the patent in relation to the issue of novelty and originality of the alleged invention, is clear and beyond question. If a fair case of invalidity, after preliminary hearing is presented, an injunction must not be issued.

The issuance of letters patent, standing alone, is not sufficient to support such drastic relief. In cases of infringement of patent no preliminary injunction will be granted unless the patent is valid and infringed beyond question and the record conclusively proves the defense is sham.

As a general rule because of the injurious consequences a writ of injunction may bring, the right to the relief demanded must be clear and unmistakable. The dissolution of the writ is proper where the applicant has doubtful title to the disputed property.

The trial court nonetheless issued the writ of preliminary injunction which under the circumstances should be denied. For failure to determine first the validity of the patents before aforesaid issuance of the writ, the trial court failed to satisfy the two requisites necessary if an injunction is to issue, namely: the existence of the right to be protected and the violation of said right.

Notes

The burden of proof to substantiate a charge of infringement is with the plaintiff. But where the plaintiff introduces the patent in evidence, and the same is in due form, there is created a prima facie presumption of its correctness and validity.

After a careful review of the evidence consisting of 64 exhibits and oral testimonies of five witnesses presented by Luchan before the Court of First Instance, the Court of Appeals was satisfied that there is a prima facie showing of a fair question of invalidity of Maguan’s patents on the ground of lack of novelty. As pointed out by CA, evidence appeared not to have been considered at all by the court a quo for alleged lack of jurisdiction, on the mistaken notion that such question in within the exclusive jurisdiction of the patent office.

It has been repeatedly held that an invention must possess the essential elements of novelty, originality and precedence and for the patentee to be entitled to protection, the invention must be new to the world. Accordingly, a single instance of public use of the invention by a patentee for more than two years (now for more than one year only under Sec. 9 of the Patent Law) before the date of his application for his patent, will be fatal to the validity of the patent when issued. 

It is generally held that in patent cases a preliminary injunction will not issue for patent infringement unless the validity of the patent is clear and beyond question. The issuance of letters patent, standing alone, is not sufficient to support such drastic relief (8 Deller’s Walker on Patents p. 406). In cases of infringement of patent no preliminary injunction will be granted unless the patent is valid and infringed beyond question and the record conclusively proves the defense is sham. (Ibid., p. 402)

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