LAWS ON INTELLECTUAL CREATION Copyright 1. What Works are not Protected: a.

any idea, procedure, system, method or operation, concept, principle, discovery, or mere data as such, even if they are expressed, explained, illustrated or embodied in a work; news of the day or other miscellaneous facts, having the character of mere items of press information, or any official text of a legislative, administrative or legal nature as well as any official translation thereof b. works of the government c. statutes, rules, and regulations of government agencies and offices d. speeches, lectures, sermons, addresses and dissertations, pronounced or rendered in courts of justices or nay administrative agencies in deliberative assemblies and meetings of public character 2. Fair Use of a Copyrighted Work is not Infringement a. for criticism, comment, news reporting, teaching, research, scholarship, and similar purposes b. decompilation: the reproduction of the code and translation of the forms of the computer program with other programs 3. Factors to Consider in Determining Fair Use: a. purpose and character of the use, including whether such use is of a commercial nature or for no profit or educational purposes b. nature of the copyrighted work c. amount and substantiality of the portion used in relation to the copyrighted work as a whole d. effect of use upon the potential market for a value of the copyrighted work 4. Terms of the Protection a. copyrighted work: lifetime of creator plus 50 years after death (to be computed on the 1st day of January of the year following the death) b. performances not incorporated in recordings: 50 years from end of year in which the performance took place c. sound or image and sound recordings and performances incorporated therein: 50 years from end of the year in which the recording took place d. broadcasts: 20 years from the date the broadcast took place 5. Remedies for Infringement a. injunction b. actual damages, including legal costs and other expenses, as he may have incurred due to the infringement as well as the profits the infringer may have made due to such infringement

c. impounding of articles during pendency of the action d. destruction of all infringing copies and/or devices e. moral and exemplary damages

6. Criminal Penalties a. imprisonment of 1 to 3 years plus fine of P50,000 to P150,000 for the first offense b. imprisonment of 3 years and 1 day to 6 years plus fine ranging from P150,000 to P500,000 for the 2nd offense c. imprisonment of 6 years and 1 day to 9 years plus fine of P500,000 to P1,000,000 for the 3rd/subsequent offenses IN ALL CASES, subsidiary imprisonment in cases of insolvency 7. Presumptions: a. Presumption of copyright in the work of other subject matter to which the action related b. Plaintiff is presumed to be the owner of the copyright c. The natural person whose name is indicated on a work in the usual manner as the author shall, in the absence of proof to the contrary, be presumed to be the author of the work. This is applicable even if the name is a pseudonym, where the pseudonym leaves no doubt as to the identity of the author. 8. Prescription: No damages may be recovered after 4 years from time the cause of action arose. Patents 1. Patentable Inventions - any technical solution of a problem in any field o human activity that is new, involve an inventive step and is industrially applicable shall be patentable. It may be or may relate to as product, or process or an improvement of any of the foregoing. 2. Non-Patentable Inventions a. discoveries, scientific theories and mathematical methods b. schemes, rules and methods of performing mental acts, playing games or doing business, and programs for computers c. methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practiced on the human or animal body Exception: products and composition for use in any of these methods d. plant varieties or animal breeds or essentially biological process for the production of plants and animals Exception: micro-organisms and non-biological and micro-biological processes e. aesthetic creations f. contrary to public order or morality

3. Requisites of Patentability a. new, novelty b. involves an inventive step; c. is industrially applicable 4. Novelty The novelty requirement in the Code is absolute. Thus, an invention is not considered new if it forms part of a prior art. A prior art consists of: a. anything which has been made available to the public anywhere in the world before the filing date or the priority date of the application, or b. the whole contents of an application for a patent, utility model, or industrial design registration, published in the IPO gazette, filed or effective in the Philippines, with a filing or priority date that is earlier than the filing or priority date of the application, provided that the application which has validly claimed the filing date of an earlier application (priority date) is prior art with effect as of the filing date of such earlier application, and provided further, that the applicant and the inventor identified in both applications are not one and the same 5. Inventive Step - an invention involves an inventive step, if having regard to the prior art, it is not obvious to a person skilled in the art at the time of the filing date of priority date of the application claiming the invention 6. Industrial Applicability - an invention is considered industrially applicable if it can be produced and used in the industry 7. The First-to-File System - if 2 or more persons have made the invention separately and independently of each other, the right to the patent belongs to the person who filed an application for such invention, or where 2 or more applications are filed for the same invention, the right of the patent belongs to the person who has the earliest filing date or the earliest priority date Under this system, the patent is granted to the inventor who filed his patent application earlier than others thus simplifying the determination of who is entitled to own the patent. The First-to-File System increases the rights of the inventor by: a. guaranteeing the confidentiality of the application prior to its publication b. giving the inventor inchoate rights against an infringer after the publication of the application and before the grant of the patent and c. expanding the rights of the inventor to institute cancellation proceedings for the duration of the term of the patent. Cancellation proceedings may be filed at any time during the term of the patent. Under this system, the applicant declared by final court order as having the right to the patent may:

a. prosecute the application as his own application in place of the original applicant b. file a new patent application in respect of the same invention c. request that the application be refused or d. seek the cancellation of the patent, if one has already been issued 8. What is the difference between novelty in patents and originality in copyright? Novelty in Patents - even if you do not know of any previous creation, as long as a patent on the same creation has already been published anywhere in the world, you cannot claim novelty. No access tot he other creation is no defense. Originality in Copyright - even if there is same creation, as long as you do not copy your own creation, it is still considered an original creation. No access to the previous creation is a defense. 9. Non-Prejudicial Disclosure The disclosure of information contained in the application during the 12 months preceding the filing date or the priority date of the application shall not prejudice the applicant on the ground of lack of novelty if such disclosure was made by (a) inventor; (b) a patent office and the information was contained 10. Term of Patent - 20 years from the filing date of the application 11. Grounds for Compulsory Licensing: a. national emergency or other circumstances of extreme urgency b. where public interest, national security, health or the development of other vital sectors of the national economy as determined by the appropriate agency of the government so requires c. where a judicial or administrative body has determined that the manner of exploitation by the owner of the patent or his licensee is anti-competitive d. in case of public non-commercial use of the patent by the patentee, without satisfactory reason e. if not being worked in the Philippines on a commercial scale 12. In case of Compulsory Licensing of Patents involving Semi-conductor Technology, the license may be granted only in case of public non-commercial use or to remedy a practice determined after judicial or administrative process to be anti-competitive 13. Utility Models - an invention qualifies for registration as a utility model if it is new and industrially applicable - no inventive step required for registration - no search and examination required 14. Term Protection - 7 years after the filing date of application without possibility of renewal 15. Industrial Design - any composition of lines or colors or any 3 dimensional form,

whether or not associated with lines or colors Industrial Designs essentially dictated 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 16. Term of Protection - 5 years from filing date of application, renewable for not more than 2 consecutive periods of 5 years each Insolvency Law 1. Distinguish Suspension of Payment and Insolvency Suspension of Payment Insolvency debtor has enough assets to meet liabilities but cannot meet them as they fall due debtor has more liabilities than assets always initiated by debtor initiated by creditors/other persons if involuntary; initiated by debtor if voluntary 2. Fraudulent Preference - any act of insolvent which gives rise/has tendency to give preference to a creditor to the assets of the insolvent prejudicial to the right of other creditors of said insolvent 3. Effect on Actions Upon Adjudication of Insolvency a. suits pending in court (1) secured obligations suspended until assignee appointed (2) unsecured obligations terminated except to fix amount of obligation (3) foreclosure suits pending continue b. suit not yet filed - cannot be filed anymore, but claims may be presented to assignee 4. Debts and Obligations not Affected by Discharge of Insolvent a. assessments due to national and local government b. debts due to fraud/embezzlement c. debts in which he is bound solidarily d. alimony e. corporate debts f. debts not included in the schedule submitted by debtor

Chattel Mortgage Law 1. The law primarily governs chattel mortgage. Provisions on pledge of NCC in so far as not in conflict with CML also govern chattel mortgages.

2. Chattel Mortgage may be rescinded for being in fraud of creditors. 3. Growing fruits are covered by chattel mortgage but they may not be pledged. 4. Machinery placed on plant or building owned by another can be the object of chattel mortgage. 5. General Rule: Chattel Mortgage cannot cover debts subsequently contracted. 6. Rules: Chattel Mortgage cannot cover debts subsequently contracted a. registered in place where mortgagor resides and where property (chattel) is located. If mortgagor resides abroad, register in place where property is located. b. Motor Vehicles: register also in Land Transportation Office c. Shares of Stock: place of domicile of corporation and shareholder. No need for notation in books of corporation d. Vessels: Phil. Coastguard 7. To be valid against 3rd persons: a. affidavit of good faith b. contract must be registered 8. General Rule: In Chattel Mortgage, there is recovery of deficiency judgment. Exception: when Recto Law applies 9. Requisites of CML: a. constituted to secure the fulfillment of principal obligation b. mortgagor is absolute owner of the thing mortgaged c. persons constituting the mortgage have the free disposal of the property and in the absence thereof, they be legally authorized for the purpose d. recorded to bind 3rd persons 10. Formal Requisites of CM: a. substantial compliance with form in Sec. 5 of CML b. signed by at least 2 witnesses c. must contain an affidavit of good faith d. certificate of oath (notarial acknowledgment) 11. Affidavit of Good Faith - where the parties severally swear that the mortgage is made for the purpose of securing the obligation specified and for no other purpose and that the same is a just and valid obligation and not one entered into for fraud - property given in CM must be described to enable the parties or any other person after reasonable inquiry and investigation to identify it 12. Future property may not be covered by CM but when such property is a:

a. renewal of, or in substitution for goods on hand when the mortgage was executed, or b. purchased with proceeds (not of your own money) of said goods, said property may be covered by CM 13. Criminal Acts - removal of chattel to another city or province without written consent of mortgagee, selling property already pledged, or mortgaged without written consent of mortgagee 14. A chattel mortgage may be foreclosed judicially or extra-judicially, in the latter case, before a notary or sheriff, or creditor or mortgagee when stipulated, even without need of notice (when mortgagee forecloses) 15. Pactum Commissorium applies to Chattel Mortgage.