[G.R. No. 166337.

� March 7, 2005]

BAYANIHAN MUSIC vs. BMG

THIRD DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated MAR 7 2005.

G.R. No. 166337 (Bayanihan Music Philippines, Inc. vs. BMG Records (Pilipinas) and Jose Mari Chan, et al.)

Subject of this petition for review on certiorari is the Decision dated December 14, 2004[1] of the Court
of Appeals in CA-G.R. SP No. 69626, upholding the Order dated August 24, 2001 of the Regional Trial
Court at Quezon City, Branch 90, which found no merit in petitioner's application for the issuance of a writ of
preliminary injunction, along with the Order dated January 10, 2002, which denied petitioner's motion for
reconsideration.

On July 16, 1973, private respondent Jose Mari Chan (Chan) entered into a contract with petitioner
Bayanihan Music Philippines, Inc. (Bayanihan), whereunder the former assigned to the latter all his rights,
interests and participation over his musical composition "Can We Just Stop and Talk A While". On March 11,
1976, the parties entered into a similar contract over Chan's other musical composition entitled "Afraid For
Love To Fade".

On the strength of the abovementioned contracts, Bayanihan applied for and was granted by the National
Library a Certificate of Copyright Registration for each of the two musical compositions, thus: November 19,
1973, for the song "Can We Just Stop and Talk A While" and on May 21, 1980, for the song "Afraid for Love
To Fade."

Apparently, without the knowledge and consent of petitioner Bayanihan, Chan authorized his co-respondent
BMG Records (Pilipinas) [BMG] to record and distribute the aforementioned musical compositions in a then
recently released album of singer Lea Salonga.

In separate letters both dated December 7, 1999, petitioner Bayanihan informed respondents Chan and
BMG of its existing copyrights over the subject musical compositions and the alleged violation of such right
by the two. Demands were made on both to settle the matter with Bayanihan. However no settlement was
reached by the parties.

Hence, on August 8, 2000, Bayanihan filed with the Regional Trial Court at Quezon City a complaint against
Chan and BMG for violation of Section 216 of Republic Act No. 8293, otherwise known as the Intellectual
Property Code of the Philippines, with a prayer for the issuance of Temporary Restraining Order (TRO)
and/or writ of preliminary injunction, enjoining respondent BMG from further recording and distributing the
subject musical compositions in whatever form of musical products, and Chan from further granting any
authority to record and distribute the same musical compositions.

In its answer, BMG contended, among others, that: (1) the acts of recording and publication sought to be
enjoined had already been consummated, thereby rendering moot Bayanihan's prayer for TRO and/or
preliminary injunction; and (2) there is no clear showing that petitioner Bayanihan would be greatly
damaged by the refusal of the prayed for TRO and/or preliminary injunction. BMG also pleaded a cross-claim
against its co-respondent Chan for violation of his warranty that his musical compositions are free from
claims of third persons, and a counterclaim for damages against petitioner Bayanihan.

Chan, for his part, filed his own answer to the complaint, thereunder alleging that: (1) it was never his
intention to divest himself of all his rights and interest over the musical compositions in question; (2) the
contracts he entered into with Bayanihan are mere music publication agreements giving Bayanihan, as
assignee, the power to administer his copyright over his two songs and to act as the exclusive publisher
thereof; (3) he was not cognizant of the application made by and the subsequent grant of copyrights to
Bayanihan; and (4) Bayanihan was remissed in its obligations under the contracts because it failed to
effectively advertise his musical compositions for almost twenty (20) years, hence, he caused
the rescission of said contracts in 1997. Chan also included in his answer a counterclaim for damages
against Bayanihan.

After hearing the parties, the lower court came out with an order denying Bayanihan's prayer for TRO,
saying, thus:

After carefully considering the arguments and evaluating the evidence presented by counsels, this Court
finds that the plaintiff has not been able to show its entitlement to the relief of TRO as prayed for in its
verified complaint (see Section 4, Rule 58 of the 1997 Rules of Civil Procedure, as amended), hence, this
Court is of the considered and humble view that the ends of justice shall be served better if the aforecited
application is denied.

IN VIEW OF THE FOREGOING, the aforecited application or prayer for the issuance of a TRO is denied.

SO ORDERED.

Thereafter, the same court, in its subsequent Order dated August 24, 2001,[2] likewise deniedcralaw

Bayanihan's prayer for a writ of preliminary injunction, to wit:

After carefully going over the pleadings and the pertinent portions of the records insofar as they are
pertinent to the issue under consideration, this Court finds that the plaintiff has not been able to show its
entitlement to the relief of preliminary injunction as prayed for in its verified complaint (see Section 4, Rule
58 of the 1997 Rules of Civil Procedure, as amended), hence, this Court is of the considered and humble
view that the ends of justice shall be served better if the aforecited application is denied, (see also Order
dated July 16, 2001).

IN VIEW OF THE FOREGOING, the application or prayer for the issuance of a writ of preliminary injunction is
denied.

SO ORDERED.

Its motion for a reconsideration of the same order having been likewise denied by the trial court in its
next Order of January 10, 2002,[3] petitioner Bayanihan then went to the Court of Appeals on a petition
cralaw

for certiorari, thereat docketed as CA-G.R. SP No. 69626, imputing grave abuse of discretion on the part of
the trial court in issuing the Orders of August 24, 2001 and January 10, 2001, denying its prayers for a writ
of preliminary injunction and motion for reconsideration, respectively.

In the herein assailed Decision dated December 14, 2004, the Court of Appeals upheld the challenged
orders of the trial court and accordingly dismissed Bayanihan petition, thus:

WHEREFORE, finding neither flaw of jurisdiction nor taint of grave abuse of discretion in the issuance of the
assailed Orders of the respondent court dated August 24, 2001 and January 10, 2002, the instant petition is
DISMISSED. No costs.

SO ORDERED.[4] cralaw

Hence, Bayanihan's present recourse.

It is petitioner's submission that the appellate court committed reversible error when it dismissed its petition
for certiorari and upheld the trial court's denial of its application for a writ of preliminary injunction.
Petitioner insists that as assignee of the copyrights over the musical compositions in question, it has a clear
legal right to a writ of preliminary injunction; that respondents BMG and Chan violated its copyrights over
the same musical compositions; that despite knowledge by respondent BMG of petitioner's copyrights over
the said musical compositions, BMG continues to record and distribute the same, to petitioner's great and
irreparable injury.
We DENY.

We have constantly reminded courts that there is no power, the exercise of which is more delicate and
requires greater caution, deliberation and sound discretion, or which is more dangerous in a doubtful case,
than the issuance of an injunction. A court should, as much as possible, avoid issuing the writ which would
effectively dispose of the main case without trial.

Here, nothing is more evident than the trial court's abiding awareness of the extremely difficult balancing
act it had to perform in dealing with petitioner's prayer for injunctive reliefs. Conscious, as evidently it is, of
the fact that there is manifest abuse of discretion in the issuance of an injunctive writ if the following
requisites provided for by law are not present: (1) there must be a right in esse or the existence of a right
to be protected; and (2) the act against which the injunction is to be directed is a violation of such
right,[5] the trial court threaded the correct path in denying petitioner's prayer therefor. For, such a writ
cralaw

should only be granted if a party is clearly entitled thereto.[6]

cralaw

Of course, while a clear showing of the right to an injunctive writ is necessary albeit its existence need not
be conclusively established,[7] as the evidence required therefor need not be conclusive or complete, still,
cralaw

for an applicant, like petitioner Bayanihan, to be entitled to the writ, he is required to show that he has the
ostensible right to the final relief prayed for in its complaint.[8] Here, the trial court did not find ample
cralaw

justifications for the issuance of the writ prayed for by petitioner.

Unquestionably, respondent Chan, being undeniably the composer and author of the lyrics of the two (2)
songs, is protected by the mere fact alone that he is the creator thereof, conformably with Republic Act No.
8293, otherwise known as the Intellectual Property Code, Section 172.2 of which reads:

172.2. Works are protected by the sole fact of their creation, irrespective of their mode or form of
expression, as well as of their content, quality and purpose.

An examination of petitioner's verified complaint in light of the two (2) contracts sued upon and the
evidence it adduced during the hearing on the application for preliminary injunction, yields not the existence
of the requisite right protectable by the provisional relief but rather a lingering doubt on whether there is or
there is no such right. The two contracts between petitioner and Chan relative to the musical compositions
subject of the suit contain the following identical stipulations:

7.������ It is also hereby agreed to by the parties herein that in the event the PUBLISHER [petitioner
herein] fails to use in any manner whatsoever within two (2) years any of the compositions covered by this
contract, then such composition may be released in favor of the WRITER and excluded from this contract
and the PUBLISHER shall execute the necessary release in writing in favor of the WRITER upon request of
the WRITER;

xxx��� xxx������ xxx

9.������ This contract may be renewed for a period of two-and-one-half (2 1/2) years at the option of
the PUBLISHER. Renewal may be made by the PUBLISHER by advising the WRITER of such renewal in
writing at least five (5) days before the expiration of this contract.[9] cralaw

It would thus appear that the two (2) contracts expired on October 1, 1975 and March 11, 1978,
respectively, there being neither an allegation, much less proof, that petitioner Bayanihan ever made use of
the compositions within the two-year period agreed upon by the parties.

Anent the copyrights obtained by petitioner on the basis of the selfsame two (2) contracts, suffice it to say
'that such purported copyrights are not presumed to subsist in accordance with Section 218[a] and [b], of
the Intellectual Property Code,[10] because respondent Chan had put in issue the existence thereof.
cralaw

It is noted that Chan revoked and terminated said contracts, along with others, on July 30, 1997, or almost
two years before petitioner Bayanihan wrote its sort of complaint/demand letter dated December 7, 1999
regarding the recent "use/recording of the songs 'Can We Just Stop and Talk A While' and 'Afraid for Love to
Fade,'" or almost three (3) years before petitioner filed its complaint on August 8, 2000, therein
praying, inter alia, for injunctive relief. By then, it would appear that petitioner had no more right that is
protectable by injunction.

Lastly, petitioner's insinuation that the trial court indulged in generalizations and was rather skimpy in
dishing out its reasons for denying its prayer for provisional injunctive relief, the same deserves scant
consideration. For sure, the manner by which the trial court crafted its challenged orders is quite
understandable, lest it be subjected to a plausible suspicion of having prejudged the merits of the main
case.

WHEREFORE, petition is hereby DENIED.

SO ORDERED.

G.R. No. L-36402 March 16, 1987

FILIPINO SOCIETY OF COMPOSERS, AUTHORS AND PUBLISHERS, INC., plaintiff-appellant,

vs.
BENJAMIN TAN, defendant-appellee.

Lichauco, Picazo & Agcaoili Law Office for plaintiff-appellant.

Ramon A. Nieves for defendant-appellee.

PARAS, J.:

An appeal was made to the Court of Appeals docketed as CA-G.R. No. 46373-R * entitled Filipino Society of
Composers, Authors, Publishers, Inc., Plaintiff-Appellant v. Benjamin Tan, Defendant-Appellee, from the decision of the Court of First
Instance of Manila, Branch VII in Civil Case No. 71222 **"Filipino Society of Composers, Authors and Publishers, Inc., Plaintiff v. Benjamin
Tan, Defendant," which had dismissed plaintiffs' complaint without special pronouncement as to costs.

The Court of Appeals, finding that the case involves pure questions of law, certified the same to the
Supreme Court for final determination (Resolution, CA-G.R. No. 46373-R, Rollo, p. 36; Resolution of
the Supreme Court of February 16, 1973 in L-36402, Rollo, p. 38).

The undisputed facts of this case are as follows:

Plaintiff-appellant is a non-profit association of authors, composers and publishers duly organized

under the Corporation Law of the Philippines and registered with the Securities and Exchange
Commission. Said association is the owner of certain musical compositions among which are the
songs entitled: "Dahil Sa Iyo", "Sapagkat Ikaw Ay Akin," "Sapagkat Kami Ay Tao Lamang" and "The
Nearness Of You."

On the other hand, defendant-appellee is the operator of a restaurant known as "Alex Soda
Foundation and Restaurant" where a combo with professional singers, hired to play and sing musical
compositions to entertain and amuse customers therein, were playing and singing the above-
mentioned compositions without any license or permission from the appellant to play or sing the
same. Accordingly, appellant demanded from the appellee payment of the necessary license fee for
the playing and singing of aforesaid compositions but the demand was ignored.

Hence, on November 7, 1967, appellant filed a complaint with the lower court for infringement of
copyright against defendant-appellee for allowing the playing in defendant-appellee's restaurant of
said songs copyrighted in the name of the former.

Defendant-appellee, in his answer, countered that the complaint states no cause of action. While not
denying the playing of said copyrighted compositions in his establishment, appellee maintains that
the mere singing and playing of songs and popular tunes even if they are copyrighted do not
constitute an infringement (Record on Appeal, p. 11; Resolution, CA-G.R. NO. 46373-R, Rollo, pp.
32-36) under the provisions of Section 3 of the Copyright Law (Act 3134 of the Philippine
Legislature).

The lower court, finding for the defendant, dismissed the complaint (Record on Appeal, p. 25).

Plaintiff appealed to the Court of Appeals which as already stated certified the case to the Supreme
Court for adjudication on the legal question involved. (Resolution, Court of Appeals, Rollo, p. 36;
Resolution of the Supreme Court of February 18, 1973, Rollo, p. 38).

In its brief in the Court of Appeals, appellant raised the following Assignment of Errors:

THE LOWER COURT ERRED IN HOLDING THAT THE MUSICAL COMPOSITIONS OF THE
APPELLANT WERE IN THE NATURE OF PUBLIC PROPERTY WHEN THEY WERE
COPYRIGHTED OR REGISTERED.

II

THE LOWER COURT ERRED IN HOLDING THAT THE MUSICAL COMPOSITIONS OF THE
APPELLANT WERE PLAYED AND SUNG IN THE SODA FOUNTAIN AND RESTAURANT OF THE
APPELLEE BY INDEPENDENT CONTRACTORS AND ONLY UPON THE REQUEST OF
CUSTOMERS.

III

THE LOWER COURT ERRED IN HOLDING THAT THE PLAYING AND SINGING OF
COPYRIGHTED MUSICAL COMPOSITIONS IN THE SODA FOUNTAIN AND RESTAURANT OF
THE APPELLEE ARE NOT PUBLIC PERFORMANCES FOR PROFIT OF THE SAID
COMPOSITIONS WITHIN THE MEANING AND CONTEMPLATION OF THE COPYRIGHT LAW.

IV

THE LOWER COURT ERRED IN NOT HOLDING THAT THE APPELLEE IS LIABLE TO THE
APPELLANT FOR FOUR (4) SEPARATE INFRINGEMENTS. (Brief for Appellant, pp. A and B).

The petition is devoid of merit.

The principal issues in this case are whether or not the playing and signing of musical compositions
which have been copyrighted under the provisions of the Copyright Law (Act 3134) inside the
establishment of the defendant-appellee constitute a public performance for profit within the meaning
and contemplation of the Copyright Law of the Philippines; and assuming that there were indeed
public performances for profit, whether or not appellee can be held liable therefor.

Appellant anchors its claim on Section 3(c) of the Copyright Law which provides:

SEC. 3. The proprietor of a copyright or his heirs or assigns shall have the exclusive
right:

xxx xxx xxx

(c) To exhibit, perform, represent, produce, or reproduce the copyrighted work in any
manner or by any method whatever for profit or otherwise; if not reproduced in copies
for sale, to sell any manuscripts or any record whatsoever thereof;

xxx xxx xxx

It maintains that playing or singing a musical composition is universally accepted as performing the
musical composition and that playing and singing of copyrighted music in the soda fountain and
restaurant of the appellee for the entertainment of the customers although the latter do not pay for
the music but only for the food and drink constitute performance for profit under the Copyright Law
(Brief for the Appellant, pp. 19-25).

We concede that indeed there were "public performances for profit. "

The word "perform" as used in the Act has been applied to "One who plays a musical composition
on a piano, thereby producing in the air sound waves which are heard as music ... and if the
instrument he plays on is a piano plus a broadcasting apparatus, so that waves are thrown out, not
only upon the air, but upon the other, then also he is performing the musical composition." (Buck, et
al. v. Duncan, et al.; Same Jewell La Salle Realty Co., 32F. 2d. Series 367).

In relation thereto, it has been held that "The playing of music in dine and dance establishment
which was paid for by the public in purchases of food and drink constituted "performance for profit"
within a Copyright Law." (Buck, et al. v. Russon No. 4489 25 F. Supp. 317). Thus, it has been
explained that while it is possible in such establishments for the patrons to purchase their food and
drinks and at the same time dance to the music of the orchestra, the music is furnished and used by
the orchestra for the purpose of inducing the public to patronize the establishment and pay for the
entertainment in the purchase of food and drinks. The defendant conducts his place of business for
profit, and it is public; and the music is performed for profit (Ibid, p. 319). In a similar case, the Court
ruled that "The Performance in a restaurant or hotel dining room, by persons employed by the
proprietor, of a copyrighted musical composition, for the entertainment of patrons, without charge for
admission to hear it, infringes the exclusive right of the owner of the copyright." (Herbert v. Shanley
Co.; John Church Co. v. Hillard Hotel Co., et al., 242 U.S. 590-591). In delivering the opinion of the
Court in said two cases, Justice Holmes elaborated thus:

If the rights under the copyright are infringed only by a performance where money is
taken at the door, they are very imperfectly protected. Performances not different in
kind from those of the defendants could be given that might compete with and even
destroy the success of the monopoly that the law intends the plaintiffs to have. It is
enough to say that there is no need to construe the statute so narrowly. The
defendants' performances are not eleemosynary. They are part of a total for which
the public pays, and the fact that the price of the whole is attributed to a particular
 item which those present are expected to order is not important. It is true that the
music is not the sole object, but neither is the food, which probably could be got
cheaper elsewhere. The object is a repast in surroundings that to people having
limited power of conversation or disliking the rival noise, give a luxurious pleasure not
to be had from eating a silent meal. If music did not pay, it would be given up. If it
pays, it pays out of the public's pocket. Whether it pays or not, the purpose of
employing it is profit, and that is enough. (Ibid., p. 594).

In the case at bar, it is admitted that the patrons of the restaurant in question pay only for the food
and drinks and apparently not for listening to the music. As found by the trial court, the music
provided is for the purpose of entertaining and amusing the customers in order to make the
establishment more attractive and desirable (Record on Appeal, p. 21). It will be noted that for the
playing and singing the musical compositions involved, the combo was paid as independent
contractors by the appellant (Record on Appeal, p. 24). It is therefore obvious that the expenses
entailed thereby are added to the overhead of the restaurant which are either eventually charged in
the price of the food and drinks or to the overall total of additional income produced by the bigger
volume of business which the entertainment was programmed to attract. Consequently, it is beyond
question that the playing and singing of the combo in defendant-appellee's restaurant constituted
performance for profit contemplated by the Copyright Law. (Act 3134 amended by P.D. No. 49, as
amended).

Nevertheless, appellee cannot be said to have infringed upon the Copyright Law. Appellee's
allegation that the composers of the contested musical compositions waived their right in favor of the
general public when they allowed their intellectual creations to become property of the public domain
before applying for the corresponding copyrights for the same (Brief for Defendant-Appellee, pp. 14-
15) is correct.

The Supreme Court has ruled that "Paragraph 33 of Patent Office Administrative Order No. 3 (as
amended, dated September 18, 1947) entitled 'Rules of Practice in the Philippines Patent Office
relating to the Registration of Copyright Claims' promulgated pursuant to Republic Act 165, provides
among other things that an intellectual creation should be copyrighted thirty (30) days after its
publication, if made in Manila, or within the (60) days if made elsewhere, failure of which renders
such creation public property." (Santos v. McCullough Printing Company, 12 SCRA 324-325 [1964].
Indeed, if the general public has made use of the object sought to be copyrighted for thirty (30) days
prior to the copyright application the law deems the object to have been donated to the public
domain and the same can no longer be copyrighted.

A careful study of the records reveals that the song "Dahil Sa Iyo" which was registered on April 20,
1956 (Brief for Appellant, p. 10) became popular in radios, juke boxes, etc. long before registration
(TSN, May 28, 1968, pp. 3-5; 25) while the song "The Nearness Of You" registered on January 14,
1955 (Brief for Appellant, p. 10) had become popular twenty five (25) years prior to 1968, (the year
of the hearing) or from 1943 (TSN, May 28, 1968, p. 27) and the songs "Sapagkat Ikaw Ay Akin" and
"Sapagkat Kami Ay Tao Lamang" both registered on July 10, 1966, appear to have been known and
sang by the witnesses as early as 1965 or three years before the hearing in 1968. The testimonies
of the witnesses at the hearing of this case on this subject were unrebutted by the appellant.
(Ibid, pp. 28; 29 and 30).

Under the circumstances, it is clear that the musical compositions in question had long become
public property, and are therefore beyond the protection of the Copyright Law.

PREMISES CONSIDERED, the appealed decision of the Court of First Instance of Manila in Civil
Case No. 71222 is hereby AFFIRMED.
SO ORDERED.

G.R. No. 76193 November 9, 1989

UNITED FEATURE SYNDICATE, INC., petitioner,

vs.
MUNSINGWEAR CREATION MANUFACTURING COMPANY, respondent.

Quasha, Asperilla, Ancheta, Pena and Nolasco for petitioner.

Jaime G. Manzano for private respondent.

PARAS, J.:

This is a petition for review on certiorari filed by United Feature Syndicate Inc., seeking to set aside
the Resolution of the Seventh Division of the Court of Appeals * dated September 16, 1986 dismissing the appeal of
petitioner-appellant for having been filed out of time and denying its Motion for Reconsideration for lack of merit in its Resolution dated
October 14, 1986.

The Resolution dismissing the appeal, reads as follows:

We agree with the Philippine Patent Office and respondent appellee that the decision
of the aforementioned office dated October 2, 1984 had already become final and
executory at the time the Notice of Appeal was filed.

Our reasons for this conclusions are borne out by the following facts:

a) On October 2, 1984, the decision sought to be appealed was

rendered by the Philippine Patent Office and a copy thereof was
received by counsel for petitioner-appellant on October 3, 1984 — not
October 9, 1984 as stated in the Notice of Appeal. There can be no
doubt about the decision having been received by petitioner-
appellant's counsel on October 3, 1984 for this is clearly written in the
Notice of Decision (p. 61, Original Record), and in point of fact the
date of receipt cannot be October 9, 1984, as declared in the Notice
of Appeal (p. 1, Rollo), because in the motion for reconsideration
subsequently filed by petitioner-appellant it was stated that a copy of
the decision was received on October 4, 1984 (p. 80, Original
Record).

b) On October 18, 1984 — as shown in the stamp mark of the

Philippine Patent Office (p. 80, Original Record) or on the 15th and
last day either for appealing or for moving for reconsideration,
petitioner-appellant filed a motion for reconsideration.
 Sadly and unexplainably for a veteran law office, said motion did not contain or
incorporate a notice of hearing.

c) Possibly realizing the fatal defect in its motion for reconsideration,

petitioner-appellant subsequently filed a motion to set for hearing its
motion for reconsideration. This was done, however, only on October
31, 1984 (p. 162, Original Record).

The motion for reconsideration filed on the last day, fatally failing as it did to contain a
notice of hearing, said pleading did not interrupt the period for appealing, for the
motion was nothing but a piece of scrap paper (Agricultural and Industrial Marketing,
Inc. v. Court of Appeals, 118 SCRA [1982] 492; Republic Planters Bank v.
Intermediate Appellate Court, 13 SCRA [1984] 631).

This deadly and moral deficiency in the motion for reconsideration, therefore,
resulted in the decision of the Philippine Patent Office being final and executory
on October 19, 1984, the day after the motion for reconsideration was filed, said
motion having been filed on the 15th and last day for appealing.

WHEREFORE, the motion of respondent appellee is hereby granted and the appeal
dismissed.

SO ORDERED. (Rollo 42-43)

This case arose from petition filed by petitioner for the cancellation of the registration of trademark
CHARLIE BROWN (Registration No. SR. 4224) in the name of respondent MUNSINGWEAR in Inter
Partes Case No. 1350 entitled "United Feature Syndicate, Inc. v. Munsingwear Creation Mfg. Co.",
with the Philippine Patent Office alleging that petitioner is damaged by the registration of the
trademark CHARLIE BROWN of T-Shirts under Class 25 with the Registration No. SR-4224 dated
September 12, 1979 in the name of Munsingwear Creation Manufacturing Co., Inc., on the following
grounds: (1) that respondent was not entitled to the registration of the mark CHARLIE BROWN, &
DEVICE at the time of application for registration; (2) that CHARLIE BROWN is a character creation
or a pictorial illustration, the copyright to which is exclusively owned worldwide by the petitioner; (3)
that as the owner of the pictorial illustration CHARLIE BROWN, petitioner has since 1950 and
continuously up to the present, used and reproduced the same to the exclusion of others; (4) that the
respondent-registrant has no bona fide use of the trademark in commerce in the Philippines prior to
its application for registration. (Petition, p. 2, Rollo, p. 8)

On October 2, 1984 the Director of the Philippine Patent Office rendered a decision in this case
holding that a copyright registration like that of the name and likeness of CHARLIE BROWN may not
provide a cause of action for the cancellation of a trademark registration, (Petition, p. 4; Rollo, p. 10 )

Petitioner filed a motion for reconsideration of the decision rendered by the Philippine Patent Office
which was denied by the Director of said office on the ground that the Decision No. 84-83 was
already final and executory (Petition, Rollo, pp. 11-12).

From this decision, petitioner-appellant appealed to the Court of Appeals and respondent court in its
resolution dated September 16, 1986 denied the appeal. While the Motion for Reconsideration was
filed on time, that is, on the last day within which to appeal, still it is a mere scrap of paper because
there was no, date, of hearing stated therein.
Subsequently, petitioner-appellant filed a motion for reconsideration which public respondent denied
for lack of merit( Annex "B", Rollo p. 45)..

Hence this petition for review on certiorari.

In the resolution of April 6, 1987, the petition was given due course.

In its petition (Rollo, p. 10) and in its memorandum (Rollo, p. 97), petitioner-appellant raised the
following legal issues:

WHETHER THE RESPONDENT COURT OF APPEALS ACTED IN EXCESS OF

JURISDICTION AND/OR COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT
BASED ITS RESOLUTION IN DISMISSING ITS APPEAL ON STRICT TECHNICAL
RULES OF PROCEDURE AS ENUNCIATED IN RULE 15 OF THE RULES OF
COURT INSTEAD OF RELYING ON THE POLICY OF THE PHILIPPINE PATENT
OFFICE AS STRESSED IN RULE 169, AS AMENDED, OF THE RULES OF
PRACTICE IN TRADEMARK CASES.

II

WHETHER THE RESPONDENT COURT OF APPEALS COMMITTED GRAVE

ABUSE OF DISCRETION AMOUNTING TO EXCESS OF JURISDICTION WHEN
BY DISMISSING THE APPEAL TO IT FROM THE DECISION OF THE DIRECTOR
OF PATENTS, IT KNOWINGLY DISREGARDED ITS OWN DECISION IN AC-GR.
SP. NO. 0342, WHICH WAS AFFIRMED BY THIS HONORABLE SUPREME
COURT TO THE EFFECT THAT A COPYRIGHTED CHARACTER MAY NOT BE
APPROPRIATED AS A TRADEMARK BY ANOTHER UNDER PRESIDENTIAL
DECREE NO. 49.

III

WHETHER, ASSUMING ARGUENDO, BUT ONLY ASSUMING, THAT THE

DECISION OF THE DIRECTOR OF PATENTS IN THE CASE AT BAR HAD
ALREADY BECOME FINAL WHEN IT WAS APPEALED TO THE COURT OF
APPEALS, THE LATTER, BY REASON OF THE SUPERVENING FACTS AFTER
THE DECISION APPEALED FROM WAS RENDERED, SHOULD HAVE
HARMONIZED THE DECISION WITH LAW, THE DEMANDS OF JUSTICE AND
EQUITY.

The petitioner is impressed with merit.

Petitioner's contention that the purpose of a notice of hearing to the adverse party is to afford him an
opportunity to resist the motion, more particularly the motion for reconsideration filed by its company
is well taken. Said purpose was served when Munsingwear filed its opposition thereto on November
20, 1984 and cured the technical defect of lack of notice of hearing complained of (Rollo, p. 52).
Otherwise stated such shortcomings of petitioner as to compliance with procedural requirements in
taking its appeal cannot be deemed sufficient to deprive it of a chance to secure a review by this
court in order to obtain substantial justice; more so where liverality accorded to the petitioner
becomes compelling because of the ostensible merit of petitioner's case (Olango v. Court of First
Instance of Misamis Oriental, 121 SCRA 338 [1983]).

Moreover, in Siguenza v. Court of Appeals, (137 SCRA 570 [1985]) the Court stressed that the right
to appeal should not be lightly disregarded by a stringent application of rules of procedure especially
where the appeal is on its face meritorious and the interest of substantial justice would be served by
permitting the appeal.

As enunciated in the case of Castro v. Court of Appeals (123 SCRA 782, [1983]) the importance and
real purpose of the remedy of appeal was stressed as follows:

An appeal is an essential part of oar judicial system. We have advised the courts to
proceed with caution so as not to deprive a party of the right to appeal. (National
Waterworks and Sewerage Authority v. Municipality of Libmanan, 97 SCRA 138) and
instructed that every party-litigant should beafforded the amplest opportunity for the
proper and just disposition of his cause, freed from the constraints of technicalities.
(A-One Feeds, Inc. v. Court of Appeals, 100 SCRA 590).

The rules of procedure are not to be applied in a very rigid and technical sense. The
rules of procedure are used only to help secure not override substantial
justice. (Gregorio v. Court of Appeals, 72 SCRA 120), therefore, we ruled in Republic
v. Court of Appeals (83 SCRA 453) that a six day delay in the perfection of the
appeal does not warrant its dismissal. And again in Ramos v. Bagaso, 96 SCRA 395,
this Court held that the delay of four (4) days in filing a notice of appeal and a motion
for extension of time to file a record on appeal can be excused on the basis of equity.

It was further emphasized that we allowed the filing of an appeal in some cases where a stringent
application of the rules would have denied it, or when to do so would serve the demands
of substantial justice and in the exercise of our equity jurisdiction (Serrano v. Court of Appeals, 139
SCRA 179 [1085].)

In the case at bar, the petitioner's delay in filing their record on appeal should not be strictly
construed as to deprive them of the right to appeal especially since on its face the appeal appears to
be impressed with merit. (Emphasis supplied). All aforementioned cases are cited in G.R. No.
76595, Pacific Asia Overseas Shipping Corporation v. NLRC, et al., May 6, 1988.

Procedural technicality should not prevail over substantive rights of a party to appeal (NEA v. CA,
126 SCRA 394).

Moreover, a judgment of the Court of Appeals that become final by reason of the mistake of the
herein petitioner's lawyer may still be reviewed on appeal by the Supreme Court particularly where
the Supreme Court already gave due course to the petition for review (Ernesto v. Court of Appeals,
116 SCRA 755 [1982]).

Where strong considerations of substantial justice are manifest in the petition, this Court may relax
the stringent application of technical rules in the exercise of equity jurisdiction. In addition to the
basic merits of the main case, such petition usually embodies justifying circumstances which warrant
our heeding the petitioner's cry for justice, inspite of the earlier negligence of counsel (Serrano v.
Court of Appeals et al., 139 SCRA 179 [1985]).

In a number of cases, this Court in the exercise of equity jurisdiction decided to disregard
technicalities in order to resolve the case on its merits based on the evidence (St. Peter Memorial
Park, Inc. et al. v. Cleofas, 121 SCRA 287, [1983]; Helmuth, Jr. v. People of the Philippines, 112
SCRA 573 [1983]).

This case was brought before this Court for the resolution of the dismissal of the appeal filed by
petitioner-appellant from the decision of the Director of the Philippines Patent Office for being filed
out of time. The normal action to take thereafter, would be to remand this case to the Court of
Appeals for further proceedings. However, in line with jurisprudence, such time consuming
procedure may be properly dispensed with to resolve the issue (Quisumbing v. Court of Appeals,
122 SCRA 709 [1983]) where there is enough basis to end the basic controversy between the
parties here and now. In the case at bar dispensing with such procedural steps would not anyway
affect substantially the merits of their respective claims as held in Velasco v. Court of Appeals, (95
SCRA 621 [1980] cited in Ortigas & Co. Ltd. v. Ruiz, 148 SCRA [1987] hence the need for this Court
to broaden its inquiry in this case land decide the same on the merits rather than merely resolve the
procedural question raised (Dorado v. Court of Appeals, 153 SCRA 420 [1987]; De Lima v. Laguna
Tayabas Co., 160 SCRA 70 [1988]).

Petitioner contends that it will be damaged by the registration of the trademark CHARLIE BROWN &
DEVICE in favor of private respondent and that it has a better right to CHARLIE BROWN & DEVICE
since the likeness of CHARLIE BROWN appeared in periodicals having worldwide distribution and
covered by copyright registration in its name which antedates the certificate of registration of
respondent issued only on September 12, 1979. (Petition, Rollo, p. 21).

Petitioner further stresses that Decision No. 84-83 (TM) promulgated by the Philippine Patent Office
on October 2, 1984 which held that "the name likeness of CHARLIE BROWN may not provide a
cause of action for the cancellation of a trademark registration," was based in the conclusion made
in the case of "Children's Television Workshop v. touch of Class" earlier decided by the Director of
Patent Office on May 10, 1984. However, when the latter case was appealed to the then
Intermediate Appellate Court, docketed as A.C. G.R. SP No. 03432, the appellate court reversed the
decision of the Director holding said appealed decision as illegal and contrary to law. this reversal
was affirmed by this Court on August 7, 1985 in G.R. No. 71210 by denying the petition of
respondent Touch of Class.

The Court of Appeals in reversing the Director of Patent's decision in Touch of Class, Inc. succintly
said:

The Patents Office ruled that a trademark, unlike a label, cannot be copyrighted. The
"Cookie Monster" is not, however, a trademark. It is a character in a TV series
entitled "Sesame Street." It was respondent which appropriated the "Cookie Monster"
as a trademark, after it has been copyrighted. We hold that the exclusive right
secured by PD 49 to the petitioner precludes the appropriation of the "Cookie
Monster" by the respondent.

Pertinently, Section 2 of Presidential Decree No. 49, otherwise known as the "Decree on Intellectual
Property", provides:

Section 2. The rights granted by this Decree shall, from the moment of creation,
subsist with respect to any of the following classes of works:

xxx xxx xxx

(O) Prints, pictorial illustrations, advertising copies, labels, tags and box wraps. ...
Therefore, since the name "CHARLIE BROWN" and its pictorial representation were covered by a
copyright registration way back in 1950 the same are entitled to protection under PD No. 49.

Aside from its copyright registration, petitioner is also the owner of several trademark registrations
and application for the name and likeness of "CHARLIE BROWN" which is the duly registered
trademark and copyright of petitioner United Feature Syndicate Inc. as early as 1957 and
additionally also as TV SPECIALS featuring the "PEANUTS" characters "CHARLIE BROWN"
(Memorandum, Rollo p. 97 [211]).

An examination of the records show that the only appreciable defense of respondent-registrant is
embodied in its answer, which reads:

It uses, the trademark "CHARLIE BROWN" & "DEVICE" on children's wear such as
T-shirts, undershirts, sweaters, brief and sandos, in class 25; whereas "CHARLIE
BROWN" is used only by petitioner as character, in a pictorial illustration used in a
comic strip appearing in newspapers and magazines. It has no trademark
significance and therefore respondent-registrant's use of "CHARLIE BROWN" &
"DEVICE" is not in conflict with the petitioner's use of "CHARLIE BROWN" (Rollo, p.
97 [21]).

It is undeniable from the records that petitioner is the actual owner of said trademark due to its prior
registration with the Patent's Office.

Finally, in La Chemise Lacoste S.A. v. Hon. Oscar Fernandez & Gobindram Hemandas Sujanani v.
Hon. Roberto V. Ongpin, et al. 129 SCRA 373 [1984]), the Court declared.

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 foregoing states under the Paris
Convention for the Protection of Industrial Property to which the Philippines and
(France) U.S. are parties. We are simply interpreting 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.

PREMISES CONSIDERED, the Resolutions of the Court of Appeals dated September 16, 1985 and
October 14, 1986 dismissing petitioner's appeal are hereby SET ASIDE and Certificate of
Registration no. SR-424 issued to private respondent dated September 12, 1979 is hereby
CANCELLED.

SO ORDERED.

G.R. No. L-19439 October 31, 1964

MAURO MALANG SANTOS, plaintiff-appellant,

vs.
MCCULLOUGH PRINTING COMPANY, defendant-appellee.
Tañada Teehankee & Carreon for plaintiff-appellant.
Esposo & Usison for defendant-appellee.

PAREDES, J.:

This is an action for damages based on the provisions of Articles 721 and 722 of the Civil Code of
the Philippines, allegedly on the unauthorized use, adoption and appropriation by the defendant
company of plaintiff's intellectual creation or artistic design for a Christmas Card. The design depicts
"a Philippine rural Christmas time scene consisting of a woman and a child in a nipa hut adorned
with a star-shaped lantern and a man astride a carabao, beside a tree, underneath which appears
the plaintiff's pen name, Malang."

The complaint alleges that plaintiff Mauro Malang Santos designed for former Ambassador Felino
Neri, for his personal Christmas Card greetings for the year 1959, the artistic motif in question. The
following year the defendant McCullough Printing Company, without the knowledge and authority of
plaintiff, displayed the very design in its album of Christmas cards and offered it for sale, for a price.
For such unauthorized act of defendant, plaintiff suffered moral damages to the tune of P16,000.00,
because it has placed plaintiff's professional integrity and ethics under serious question and caused
him grave embarrassment before Ambassador Neri. He further prayed for the additional sum of
P3,000.00 by way of attorney's fee.

Defendant in answer to the complaint, after some denials and admissions, moved for a dismissal of
the action claiming that —

(1) The design claimed does not contain a clear notice that it belonged to him and that he
prohibited its use by others;

(2) The design in question has been published but does not contain a notice of copyright, as
in fact it had never been copyrighted by the plaintiff, for which reason this action is barred by
the Copyright Law;

(3) The complaint does not state a cause of action.

The documentary evidence submitted were the Christmas cards, as originally designed by plaintiff,
the design as printed for Ambassador Neri, and the subsequent reprints ordered by other parties.
The case was submitted an a "Stipulation of Fact" the pertinent portions of which are hereunder
reproduced:

1. That the plaintiff was the artist who created the design shown in Exhibit A, ...

2. That the design carries the pen name of plaintiff, MALANG, on its face ... and indicated in
Exhibit A, ...

3. That said design was created by plaintiff in the latter part of 1959 for the personal use of
former Ambassador Felino Neri; ...

4. That former Ambassador Neri had 800 such cards ... printed by the defendant company in
1959, ... which he distributed to his friends in December, 1959;

5. That defendant company utilized plaintiff's design in the year 1960 in its album of
Christmas card samples displayed to its customers ... .
 6. That the Sampaguita Pictures, Inc., placed an order with defendant company for 700 of
said cards ... while Raul Urra & Co. ordered 200 ..., which cards were sent out by them to
their respective correspondent, clients and friends during the Christmas season of 1960;

7. That defendant company's use of plaintiff's design was without knowledge, authority or
consent of plaintiff;

8. That said design has not been copyrighted;

9. That plaintiff is an artist of established name, good-will and reputation. ... .

Upon the basis of the facts stipulated, the lower court rendered judgment on December 1, 1961, the
pertinent portions of which are recited below:

As a general proposition, there can be no dispute that the artist acquires ownership of the
product of his art. At the time of its creation, he has the absolute dominion over it. To help
the author protect his rights the copyright law was enacted.

In intellectual creations, a distinction must be made between two classes of property rights;
the fact of authorship and the right to publish and/or distribute copies of the creation. With
regard to the first, i.e. the fact of authorship, the artist cannot be divested of the same. In
other words, he may sell the right to print hundred of his work yet the purchaser of said right
can never be the author of the creation.

It is the second right, i.e., the right to publish, republish, multiply and/or distribute copies of
the intellectual creation which the state, through the enactment of the copyright law, seeks to
protect. The author or his assigns or heirs may have the work copyrighted and once this is
legally accomplished any infringement of the copyright will render the infringer liable to the
owner of the copyright.

xxx xxx xxx

The plaintiff in this case did not choose to protect his intellectual creation by a copyright. The
fact that the design was used in the Christmas card of Ambassador Neri who distributed
eight hundred copies thereof among his friends during the Christmas season of 1959, shows
that the, same was published.

Unless satisfactorily explained a delay in applying for a copyright, of more than thirty days
from the date of its publication, converts the property to one of public domain.

Since the name of the author appears in each of the alleged infringing copies of the
intellectual creation, the defendant may not be said to have pirated the work nor guilty of
plagiarism Consequently, the complaint does not state a cause of action against the
defendant.

xxx xxx ;xxx

WHEREFORE, the Court dismisses the complaint without pronouncement as to costs.

In his appeal to this Court, plaintiff-appellant pointed five (5) errors allegedly committed by the trial
court, all of which bring to the fore, the following propositions: (1) whether plaintiff is entitled to
protection, notwithstanding the, fact that he has not copyrighted his design; (2) whether the
publication is limited, so as to prohibit its use by others, or it is general publication, and (3) whether
the provisions of the Civil Code or the Copyright Law should apply in the case. We will undertake a
collective discussion of these propositions.

Under the established facts, We find that plaintiff is not entitled to a protection, the provision of the
Civil Code, notwithstanding. Paragraph 33 of Patent Office Administrative Order No. 3 (as amended
dated September 18, 1947) entitled "Rules of Practice in the Philippines Patent Office relating to the
Registration of Copyright Claims" promulgated pursuant to Republic Act 165, provides, among
others, that an intellectual creation should be copyrighted thirty (30) days after its publication, if
made in Manila, or within sixty (60) day's if made elsewhere, failure of which renders such creation
public property. In the case at bar, even as of this moment, there is no copyright for the design in
question. We are not also prepared to accept the contention of appellant that the publication of the
design was a limited one, or that there was an understanding that only Ambassador Neri should,
have absolute right to use the same. In the first place, if such were the condition then Ambassador
Neri would be the aggrieved party, and not the appellant. In the second place, if there was such a
limited publication or prohibition, the same was not shown on the face of the design. When the
purpose is a limited publication, but the effect is general publication, irrevocable rights thereupon
become vested in the public, in consequence of which enforcement of the restriction becomes
impossible (Nutt vs. National Institute, 31 F [2d] 236). It has been held that the effect of offering for
sale a dress, for example manufactured in accordance with an original design which is not protected
by either a copyright or a patent, is to divest the owner of his common law rights therein by virtue of
the publication of a 'copy' and thereafter anyone is free to copy the design or the dress (Fashion
Originators Guild of America v. Federal Trade Commission, 114 F [2d] 80). When Ambassador Neri
distributed 800 copies of the design in controversy, the plaintiff lost control of his design and the
necessary implication was that there had been a general publication, there having been no showing
of a clear indication that a limited publication was intended. The author of a literary composition has
a light to the first publication thereof. He has a right to determine whether it shall be published at all,
and if published, when, where, by whom, and in what form. This exclusive right is confined to the first
publication. When once published, it is dedicated to the public, and the author loses the exclusive
right to control subsequent publication by others, unless the work is placed under the protection of
the copyright law. (See II Tolentino's Comments on the Civil Code, p. 433, citing Wright v. Eisle 83
N.Y. Supp. 887.)

CONFORMABLY WITH ALL THE FOREGOING, We find that the errors assigned have not been
committed by the lower court. The decision appealed from, therefore, should be, as it is hereby
affirmed. Costs taxed against plaintiff-appellant.