Samson vs. Daway

Regional Trial Courts maintain exclusive original jurisdiction over criminal cases for unfair competition and other violations of intellectual property rights under R.A. No. 8293 and R.A. No. 166, regardless of the imposable penalty being less than six years imprisonment, because these statutes constitute special laws that prevail over the general jurisdictional provisions of R.A. No. 7691.

The petitioner, a registered owner of a shoe manufacturing business, faced criminal prosecution for unfair competition involving the alleged distribution and sale of counterfeit Caterpillar products. The dispute arose from the intersection of procedural rules governing jurisdiction over intellectual property cases and the proper grounds for suspending criminal arraignment pending administrative review and related civil proceedings.

• Petitioner Manolo P. Samson is the registered owner of ITTI Shoes/Mano Shoes Manufacturing Corporation located at Robinson's Galleria, Quezon City.
• On March 7, 2002, two informations were filed against petitioner charging him with unfair competition under Section 168.3(a) in relation to Section 170 of the Intellectual Property Code (R.A. No. 8293).
• The informations alleged that during the first week of November 1999 and sometime prior or subsequent thereto, petitioner willfully distributed, sold, and/or offered for sale Caterpillar products such as footwear, garments, clothing, bags, and accessories which were closely identical to or colorable imitations of authentic Caterpillar products, using trademarks, symbols, and designs that would cause confusion, mistake, or deception on the buying public.
• The penalty for unfair competition under Section 170 of R.A. No. 8293 is imprisonment from two to five years and a fine ranging from Fifty Thousand Pesos to Two Hundred Thousand Pesos.
• Petitioner filed a motion to suspend arraignment citing: (a) the existence of a prejudicial question in Civil Case No. Q-00-41446 for unfair competition pending before the same branch; and (b) the pendency of a petition for review filed with the Secretary of Justice assailing the Chief State Prosecutor's resolution finding probable cause.
• Petitioner subsequently filed a motion to quash the informations and a motion for reconsideration of the order denying suspension, this time challenging the jurisdiction of the trial court and contending that since the penalty does not exceed six years, the offense is cognizable by the Municipal Trial Courts under R.A. No. 7691.

• The Regional Trial Court lacks jurisdiction over the offense of unfair competition because under Section 170 of R.A. No. 8293, the penalty of imprisonment ranges only from two to five years, which does not exceed six years; therefore, under R.A. No. 7691, the offense is cognizable by the Municipal Trial Courts.
• R.A. No. 166 (The Trademark Law) was expressly repealed by R.A. No. 8293, and consequently, Section 27 thereof which confers jurisdiction over unfair competition cases to the Court of First Instance (now RTC) no longer applies.
• The existence of Civil Case No. Q-00-41446 for unfair competition constitutes a prejudicial question that justifies the suspension of the criminal proceedings.
• The pendency of a petition for review with the Secretary of Justice regarding the finding of probable cause is a valid ground to suspend the arraignment and other proceedings.
• The trial court committed grave abuse of discretion in denying the motions to suspend and to quash.

• R.A. No. 8293 did not expressly repeal R.A. No. 166 in its entirety; the repealing clause only affected provisions inconsistent with the new law, and Section 27 of R.A. No. 166 remains in force as it is consistent with Section 163 of R.A. No. 8293.
• As special laws, R.A. No. 8293 and R.A. No. 166 conferring jurisdiction over intellectual property violations to the Regional Trial Court prevail over the general law R.A. No. 7691.
• There is no prejudicial question because the civil action for unfair competition constitutes an independent civil action under Article 33 of the Civil Code which may proceed independently of the criminal action.
• The suspension of arraignment based on a pending petition for review with the Department of Justice is limited to sixty days under Section 11(c) of Rule 116 of the Revised Rules on Criminal Procedure.
• The petitioner failed to substantiate his allegations and attach necessary documents to prove his entitlement to the relief sought.

• Procedural Issues:
  • Whether the respondent Judge gravely abused his discretion in refusing to suspend the arraignment and other proceedings on the ground of the existence of a prejudicial question.
  • Whether the respondent Judge gravely abused his discretion in refusing to suspend the arraignment based on the pendency of a petition for review with the Secretary of Justice on the finding of probable cause.
• Substantive Issues:
  • Which court has jurisdiction over criminal cases for violation of intellectual property rights under R.A. No. 8293—the Regional Trial Court or the Municipal Trial Court?

• Procedural:
  • No grave abuse of discretion was committed by the respondent Judge in denying the motion to suspend arraignment based on the alleged prejudicial question. The Court ruled that there is no prejudicial question when the civil and criminal actions can proceed independently of each other. Civil Case No. Q-00-41446 constitutes an independent civil action for damages under Article 33 of the Civil Code (cases of fraud), which may proceed entirely separate and distinct from the criminal action and requires only a preponderance of evidence.
  • No grave abuse of discretion was committed in denying the suspension based on the pending petition for review. While Section 11(c) of Rule 116 allows suspension of arraignment upon the filing of a petition for review with the Department of Justice, such suspension is strictly limited to a period of sixty days counted from the filing of the petition. After the expiration of this period, the trial court is bound to arraign the accused or deny the motion to defer. The petitioner failed to establish the date of filing of the petition for review or that the sixty-day period had not expired, and failed to attach the August 9, 2002 order denying his motion to suspend, thereby failing to discharge his burden of proof.
  • The petition was further dismissed for failure to comply with Section 3, Rule 46 of the Rules of Civil Procedure, as the petitioner failed to attach clearly legible duplicate originals or certified true copies of the judgment, order, or resolution subject thereof, and other documents relevant or pertinent thereto.
• Substantive:
  • The Regional Trial Court has jurisdiction over criminal cases for unfair competition under R.A. No. 8293. The Court held that R.A. No. 8293 did not expressly repeal R.A. No. 166 in its entirety; the repealing clause (Section 239) used the phrases "parts of Acts" and "inconsistent herewith," indicating that only provisions repugnant to or not susceptible of harmonization with R.A. No. 8293 were repealed.
  • Section 27 of R.A. No. 166, which lodges jurisdiction over unfair competition cases with the Court of First Instance (now Regional Trial Court), is consistent and in harmony with Section 163 of R.A. No. 8293, which provides that actions shall be brought before the proper courts with appropriate jurisdiction under existing laws.
  • Applying the principle that in case of conflict between a general law and a special law, the latter must prevail, the Court held that R.A. No. 8293 and R.A. No. 166 are special laws conferring jurisdiction over violations of intellectual property rights to the Regional Trial Court, and therefore prevail over R.A. No. 7691, which is a general law expanding the jurisdiction of Municipal Trial Courts.
  • The Court distinguished Mirpuri v. Court of Appeals, noting that it did not categorically rule that jurisdiction over intellectual property rights violations is lodged with Municipal Trial Courts, and that any passing remark therein regarding the repeal of R.A. No. 166 was merely a backgrounder to the enactment of the Intellectual Property Code.

• Special Law vs. General Law — The doctrine provides that in case of conflict between a general law and a special law, the special law must prevail. In this case, the Court applied this principle to hold that R.A. No. 8293 and R.A. No. 166, as special laws conferring jurisdiction over intellectual property violations to Regional Trial Courts, prevail over R.A. No. 7691, the general law expanding Municipal Trial Court jurisdiction.
• Express Repeal vs. Implied Repeal — The doctrine holds that repeal of laws must be express and cannot be implied unless the intention to repeal is manifest. The Court interpreted the repealing clause of R.A. No. 8293 ("parts of Acts inconsistent herewith") to mean that only provisions repugnant to the new law were repealed, not entire statutes, thereby preserving Section 27 of R.A. No. 166 regarding jurisdiction.
• Prejudicial Question — A prejudicial question exists only when the civil and criminal actions are so intimately connected that the final judgment in the civil action is determinative of the guilt or innocence of the accused in the criminal action. The Court ruled that no prejudicial question exists if the civil and criminal actions can proceed independently of each other.
• Independent Civil Action — Under Article 33 of the Civil Code, in cases of defamation, fraud, and physical injuries, a civil action for damages may be brought entirely separate and distinct from the criminal action. The Court held that unfair competition involves fraud, making the civil action therefor independent of the criminal action.
• Jurisdiction over Intellectual Property Cases — Regional Trial Courts have exclusive original jurisdiction over criminal actions for infringement of registered marks, unfair competition, false designation of origin, and false description or representation, regardless of the imposable penalty, by virtue of Section 163 of R.A. No. 8293 read in conjunction with Section 27 of R.A. No. 166.

• "The use of the phrases 'parts of Acts' and 'inconsistent herewith' only means that the repeal pertains only to provisions which are repugnant or not susceptible of harmonization with R.A. No. 8293."
• "Moreover, the settled rule in statutory construction is that in case of conflict between a general law and a special law, the latter must prevail."
• "At any rate, there is no prejudicial question if the civil and the criminal action can, according to law, proceed independently of each other."
• "It follows, therefore, that after the expiration of said period, the trial court is bound to arraign the accused or to deny the motion to defer arraignment."
• "Indeed, the age-old but familiar rule is that he who alleges must prove his allegations."

• Mirpuri v. Court of Appeals — Distinguished; the Court clarified that this case did not categorically rule that Section 27 of R.A. No. 166 was repealed by R.A. No. 8293, nor did it make a jurisdictional pronouncement that Municipal Trial Courts have jurisdiction over intellectual property cases. The passing remark therein regarding repeal was merely a backgrounder to the enactment of the Intellectual Property Code.
• Manzano v. Valera — Cited as authority for the principle that in case of conflict between a general law and a special law, the latter must prevail.
• Faberge Incorporated v. Intermediate Appellate Court — Cited to support the characterization of R.A. No. 8293 and R.A. No. 166 as special laws.
• People v. Consing, Jr. — Cited for the definition that there is no prejudicial question if the civil and criminal actions can proceed independently of each other.

• Section 163, Republic Act No. 8293 (Intellectual Property Code) — Provides that actions under specified sections shall be brought before the proper courts with appropriate jurisdiction under existing laws.
• Section 168.3(a), Republic Act No. 8293 — Defines unfair competition as any person who passes off goods as those of another or uses any deceptive device or means to cause confusion or deception.
• Section 170, Republic Act No. 8293 — Imposes a criminal penalty of imprisonment from two to five years and a fine ranging from Fifty Thousand to Two Hundred Thousand Pesos for infringement, unfair competition, and false designation of origin.
• Section 239, Republic Act No. 8293 — The repealing clause providing that only Acts and parts of Acts inconsistent with the Code are repealed.
• Section 27, Republic Act No. 166 (The Trademark Law) — Confers jurisdiction over infringement, unfair competition, and false designation cases to the Court of First Instance (now Regional Trial Court).
• Section 27, Republic Act No. 7691 — The general law expanding the jurisdiction of Municipal Trial Courts to include offenses punishable by imprisonment not exceeding six years.
• Article 33, Civil Code of the Philippines — Allows an independent civil action for damages in cases of defamation, fraud, and physical injuries to proceed independently of the criminal action.
• Section 11(c), Rule 116, Revised Rules on Criminal Procedure — Allows suspension of arraignment for sixty days when a petition for review of the prosecutor's resolution is pending with the Department of Justice or the Office of the President.
• Section 3, Rule 46, Rules of Civil Procedure — Mandates that petitions for certiorari must be accompanied by clearly legible duplicate originals or certified true copies of the judgment, order, or resolution subject thereof, and other relevant documents; non-compliance is a ground for dismissal.