Phil Pharmawealth, Inc. vs. Pfizer, Inc.

The Supreme Court established that: (1) a patentee's exclusive right to make, use, and sell a patented product exists only during the term of the patent, and consequently, no injunctive relief may be issued to protect an expired patent; (2) the Court of Appeals has jurisdiction to review interlocutory orders of the Bureau of Legal Affairs of the Intellectual Property Office through a special civil action for certiorari under Rule 65 of the Rules of Court where the Intellectual Property Code provides no appeal therefrom; and (3) forum shopping exists when a party files multiple actions based on the same acts or omissions violating identical rights, regardless of whether different patents are invoked, provided the ultimate objective and reliefs sought are substantially the same.

Pfizer, Inc. was the registered owner of Philippine Letters Patent No. 21116, issued on July 16, 1987, covering a method of increasing the effectiveness of beta-lactam antibiotics using sulbactam sodium, specifically the combination known as Sulbactam Ampicillin marketed under the brand name "Unasyn." The patent was valid for seventeen years until July 16, 2004 under Republic Act No. 165. In early 2003, Phil Pharmawealth, Inc. began submitting bids to supply Sulbactam Ampicillin to various hospitals without Pfizer's authorization, prompting Pfizer to initiate administrative and judicial actions to enforce its patent rights.

• Pfizer, Inc. was the registered owner of Philippine Letters Patent No. 21116, issued on July 16, 1987, covering a method of increasing the effectiveness of beta-lactam antibiotics through co-administration with sulbactam sodium, specifically covering the combination ampicillin sodium/sulbactam sodium (Sulbactam Ampicillin).
• The patent was valid for seventeen years from the date of issuance, expiring on July 16, 2004, pursuant to Section 21 of Republic Act No. 165.
• Pfizer marketed the product under the brand name "Unasyn" through its exclusive distributor Zuellig Pharma Corporation.
• In January and February 2003, Phil Pharmawealth, Inc. submitted bids to supply Sulbactam Ampicillin to several hospitals without Pfizer's consent, allegedly infringing the patent.
• Pfizer filed an administrative complaint with the BLA-IPO seeking permanent injunction, damages, and forfeiture of infringing products, and obtained a ninety-day preliminary injunction on July 15, 2003.
• The BLA-IPO denied Pfizer's Motion for Extension of the preliminary injunction on October 15, 2003, and denied reconsideration on January 23, 2004.
• While pursuing certiorari relief before the Court of Appeals to extend the injunction, Pfizer simultaneously filed a civil complaint with the RTC of Makati City (Civil Case No. 04-754) for infringement of a different patent (Philippine Patent No. 26810) and unfair competition, seeking substantially identical reliefs: temporary restraining order, preliminary injunction, permanent injunction, damages, and forfeiture of goods.
• The RTC issued a temporary restraining order on August 24, 2004, and a preliminary injunction on April 6, 2005.
• Philippine Letters Patent No. 21116 expired on July 16, 2004, while the certiorari case was pending before the Court of Appeals.

• Phil Pharmawealth argued that injunctive relief cannot be issued to protect a patent that has already lapsed, asserting that Pfizer's exclusive rights under Patent No. 21116 ceased to exist upon its expiration on July 16, 2004, rendering the Court of Appeals' temporary restraining order issued on January 18, 2005 improper.
• Phil Pharmawealth contended that under the doctrine of primary jurisdiction and Section 7(b) of Republic Act No. 8293, the Director General of the Intellectual Property Office, not the Court of Appeals, has exclusive appellate jurisdiction to review decisions of the Director of the Bureau of Legal Affairs.
• Phil Pharmawealth claimed that Pfizer was guilty of forum shopping for filing separate actions before the BLA-IPO and the RTC, both seeking to prevent Phil Pharmawealth from importing, distributing, and selling Sulbactam Ampicillin products, despite the complaints being based on different patent numbers.

• Pfizer argued that the complaints filed with the BLA-IPO and the RTC were based on different causes of action because they involved violations of different patents (Patent No. 21116 in the administrative case and Patent No. 26810 in the civil case), and therefore did not constitute forum shopping.
• Pfizer maintained that the Court of Appeals had jurisdiction to review the interlocutory orders of the BLA-IPO via certiorari under Rule 65 of the Rules of Court, as Republic Act No. 8293 did not provide a specific remedy for questioning interlocutory orders.
• Pfizer asserted that the admission of patent expiration required proof and could not be taken as judicial admission, and that the injunction was necessary to protect their rights.

• Procedural Issues:
  • Whether the Court of Appeals has jurisdiction to review interlocutory orders issued by the Bureau of Legal Affairs of the Intellectual Property Office.
  • Whether respondents are guilty of forum shopping for filing separate actions before the Intellectual Property Office and the Regional Trial Court.
• Substantive Issues:
  • Whether injunctive relief can be issued based on an action for patent infringement when the patent allegedly infringed has already lapsed.

• Procedural:
  • The Court of Appeals has jurisdiction to review interlocutory orders of the BLA-IPO via a special civil action for certiorari under Rule 65 of the Rules of Court, as Republic Act No. 8293 is silent regarding remedies for interlocutory orders, and the Rules of Court apply in a suppletory manner.
  • The doctrine of primary jurisdiction applies to the initial filing of the complaint with the BLA-IPO due to the technical nature of patent infringement issues, but it does not apply to the purely legal question of whether to extend a writ of preliminary injunction, which falls within judicial competence.
  • Respondents are guilty of forum shopping because there is substantial identity of parties, rights asserted, and reliefs prayed for in both the administrative and civil actions, with the ultimate objective being to prevent petitioner from selling Sulbactam Ampicillin products and to recover damages.
  • The forum shopping was not willful and deliberate, as respondents disclosed the pendency of the administrative case to the trial court and may have erroneously believed that different patents justified separate actions; thus, Civil Case No. 04-754 is dismissed on the ground of litis pendentia without prejudice.
  • The petition for certiorari before the Court of Appeals is dismissed for being moot and academic due to the expiration of the patent.
• Substantive:
  • Under Section 37 of Republic Act No. 165, a patentee's exclusive right to make, use, and sell the patented product exists only during the term of the patent.
  • Since Philippine Letters Patent No. 21116 expired on July 16, 2004, respondents no longer possessed a clear and unmistakable right to the exclusive sale of Sulbactam Ampicillin products when the Court of Appeals issued the temporary restraining order on January 18, 2005.
  • The requisites for injunctive relief—existence of a right to be protected and urgent necessity to prevent serious damage—were no longer present after the patent expiration; therefore, the issuance of injunctive relief was improper.

• Doctrine of Primary Jurisdiction — Courts should refrain from exercising jurisdiction over matters requiring specialized administrative expertise until the administrative agency has resolved technical issues. Applied to uphold the initial filing of the patent infringement case with the BLA-IPO, but held inapplicable to the purely legal question of extending a preliminary injunction, which does not require the agency's special technical competence.
• Forum Shopping — The act of filing multiple actions or proceedings grounded on the same cause to obtain a favorable opinion, or seeking substantially the same reliefs from different forums. Elements include: (a) identity of parties or those representing the same interests; (b) identity of rights asserted and reliefs prayed for founded on the same facts; and (c) identity such that any judgment in one action will amount to res judicata in the other.
• Requirements for Injunctive Relief — To warrant the issuance of a writ of preliminary injunction or temporary restraining order, two requisites must exist: (1) the existence of a clear and unmistakable right that must be protected; and (2) an urgent and paramount necessity for the writ to prevent serious damage.

• "A patentee shall have the exclusive right to make, use and sell the patented machine, article or product, and to use the patented process for the purpose of industry or commerce, throughout the territory of the Philippines for the term of the patent..."
• "It is clear from the above-quoted provision of law that the exclusive right of a patentee to make, use and sell a patented product, article or process exists only during the term of the patent."
• "What is truly important to consider in determining whether forum shopping exists or not is the vexation caused the courts and parties-litigant by a party who asks different courts and/or administrative agencies to rule on the same or related causes and/or to grant the same or substantially the same reliefs, in the process creating the possibility of conflicting decisions being rendered by the different fora upon the same issue."
• "The objective of the doctrine of primary jurisdiction is to guide a court in determining whether it should refrain from exercising its jurisdiction until after an administrative agency has determined some question or some aspect of some question arising in the proceeding before the court."

• Fabia v. Court of Appeals — Cited for the definition and application of the doctrine of primary jurisdiction, explaining that courts should refer specialized disputes to administrative agencies of special competence.
• First Philippine International Bank v. Court of Appeals — Cited for the principle that filing two actions with the same objective constitutes forum shopping, even if worded differently or impleading different parties representing the same interests.
• Danville Maritime, Inc. v. Commission on Audit — Cited to illustrate forum shopping where the ultimate objective in both actions is the same despite ostensibly different reliefs prayed for.
• Angeles City v. Angeles City Electric Corporation — Cited for the requisites of injunctive relief, specifically the existence of a clear right and urgent necessity to prevent damage.
• Clark Development Corporation v. Mondragon Leisure and Resorts Corporation — Cited for the definition and elements of forum shopping.
• Pulido v. Abu — Cited for the definition of forum shopping as seeking favorable opinions from different forums.

• Section 37 of Republic Act No. 165 (Patent Law) — Defines the exclusive rights of patentees to make, use, and sell the patented invention, limited to the term of the patent.
• Section 21 of Republic Act No. 165 — Prescribes that the term of a patent shall be seventeen years from the date of issuance.
• Section 7(b) of Republic Act No. 8293 (Intellectual Property Code of the Philippines) — Grants the Director General of the IPO exclusive appellate jurisdiction over decisions rendered by the Director of the BLA-IPO.
• Section 3, Rule 58 of the Rules of Court — Enumerates the requirements for the issuance of a writ of preliminary injunction.
• Section 1 and 4, Rule 65 of the Rules of Court — Provisions governing special civil actions for certiorari, including the requirement of no appeal or adequate remedy and the sixty-day filing period.
• Section 2, Rule 2 of the Rules of Court — Definition of cause of action as the act or omission by which a party violates a right of another.
• Section 4, Rule 129 of the Rules of Court — Provides that judicial admissions do not require proof and may be contradicted only by showing palpable mistake.

• N/A (Carpio, Nachura, Abad, and Mendoza, JJ., concurred without separate opinions)