G.R. No. 126627; August 14, 2003
SMITH KLINE BECKMAN CORPORATION, Petitioner, vs. THE HONORABLE COURT OF APPEALS and TRYCO PHARMA CORPORATION, Respondents.

FACTS

Petitioner Smith Kline Beckman Corporation is the grantee of Letters Patent No. 14561 for an invention relating to a compound named methyl 5 propylthio-2-benzimidazole carbamate and its use as a parasiticide. Petitioner sued respondent Tryco Pharma Corporation for patent infringement and unfair competition before the Regional Trial Court (RTC), alleging that Tryco’s veterinary drug “Impregon,” which uses Albendazole as its active ingredient, infringes its patent. Petitioner claimed its patent covers the substance Albendazole. Tryco defended itself by asserting that the patent does not mention Albendazole and that even if it did, the patent is void for being filed beyond the one-year priority period from its foreign application, violating the Patent Law.
The RTC dismissed the complaint, declared the patent null and void for violating Sections 7, 9, and 15 of the Patent Law, and awarded Tryco actual damages and attorney’s fees. On appeal, the Court of Appeals (CA) modified the decision. It upheld the finding of no infringement, agreeing that petitioner failed to prove that Albendazole is the same as the patented compound. However, the CA reversed the nullification of the patent, finding that the application was timely filed as a divisional application, thus complying with the one-year priority rule. Petitioner elevated the case to the Supreme Court.

ISSUE

The primary issue is whether respondent Tryco Pharma Corporation infringed petitioner’s patent by manufacturing and selling “Impregon” containing Albendazole.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals’ decision with modification regarding damages. The Court ruled that there was no patent infringement. The burden of proof to establish infringement rests on the patent owner. Petitioner failed to discharge this burden as it did not present conclusive evidence that Albendazole is the same as the methyl 5 propylthio-2-benzimidazole carbamate compound covered by its patent claims. The patent’s claims, which define the scope of the monopoly, do not mention Albendazole. The Court noted that a separate U.S. patent for Albendazole existed in the name of an entity related to petitioner, implying it is a distinct substance. Without clear proof of identity, no infringement can be declared.
The Court also found no unfair competition, as Tryco did not pass off its product as that of petitioner. Regarding the patent’s validity, the Supreme Court sustained the CA’s finding that the patent was not void, as the filing was within the prescribed period considering it was a divisional application. However, the Court modified the damages awarded. It deleted the award of actual damages and attorney’s fees to Tryco for lack of sufficient documentary evidence to substantiate the claimed actual losses and absence of proof of petitioner’s bad faith in filing the suit. In lieu thereof, the Court awarded temperate damages of ₱20,000.00 to Tryco, recognizing it suffered some unquantifiable pecuniary loss from the litigation.