In Juno Batistis v. People of the Philippines, the Supreme Court upheld the conviction of Juno Batistis for trademark infringement, emphasizing the importance of protecting registered trademarks and penalizing those who deceive the public with counterfeit goods. While affirming the conviction, the Court modified the imposed penalty to comply with the Indeterminate Sentence Law, ensuring a more flexible and equitable application of justice. This decision highlights the judiciary’s role in safeguarding intellectual property rights and maintaining fair trade practices in the Philippines.

Counterfeit Brandy: How Trademark Infringement Landed Juno Batistis in Court

The case began with the trademarked brandy, Fundador, produced by Pedro Domecq, S.A. Agents of the National Bureau of Investigation (NBI) conducted a test-buy and confirmed that Juno Batistis was manufacturing, selling, and distributing counterfeit Fundador brandy. A subsequent search of Batistis’s premises, authorized by Search Warrant No. 01-2576, uncovered a trove of items indicative of trademark infringement, including empty Fundador bottles, boxes, plastic caps, and filled bottles of the counterfeit brandy. The City Prosecutor of Manila then charged Batistis with both infringement of trademark and unfair competition. The Regional Trial Court (RTC) found Batistis guilty of both charges. However, the Court of Appeals (CA) affirmed the conviction for infringement of trademark but reversed the conviction for unfair competition due to insufficient evidence.

Batistis appealed the CA’s decision, arguing that the only evidence against him was the self-serving testimonies of the NBI agents. He claimed he was not present during the search, and the confiscated items were not all found in his house. The Supreme Court, however, rejected these arguments, emphasizing that appeals to the Court should only raise questions of law, not questions of fact that require re-evaluation of evidence. The Court highlighted that factual findings of the lower courts, especially when affirmed by the Court of Appeals, are generally binding and not subject to re-examination unless there are extraordinary circumstances.

The Supreme Court underscored that it is not a trier of facts and will not disturb the factual findings of the Court of Appeals (CA) unless such findings are mistaken, absurd, speculative, or conflicting. The court cited Belgica v. Belgica to differentiate questions of law from questions of fact:

xxx [t]here exists a question of law when there is doubt on what the law applicable to a certain set of facts is. Questions of fact, on the other hand, arise when there is an issue regarding the truth or falsity of the statement of facts. Questions on whether certain pieces of evidence should be accorded probative value or whether the proofs presented by one party are clear, convincing and adequate to establish a proposition are issues of fact. Such questions are not subject to review by this Court. As a general rule, we review cases decided by the CA only if they involve questions of law raised and distinctly set forth in the petition.

Moreover, the Court noted that factual findings, calibration of testimonies, and assessment of probative weight by the RTC are given high respect unless significant facts and circumstances were ignored or misinterpreted. In this case, the RTC and CA correctly applied the law to the facts presented.

The Court then analyzed whether the acts of Batistis constituted infringement of trademark under Article 155 of the Intellectual Property Code:

Section 155. Remedies; Infringement. — Any person who shall, without the consent of the owner of the registered mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark or the same container or a dominant feature thereof in connection with the sale, offering for sale, distribution, advertising of any goods or services including other preparatory steps necessary to carry out the sale of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive; or

155.2. Reproduce, counterfeit, copy or colorably imitate a registered mark or a dominant feature thereof and apply such reproduction, counterfeit, copy or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be used in commerce upon or in connection with the sale, offering for sale, distribution, or advertising of goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive, shall be liable in a civil action for infringement by the registrant for the remedies hereinafter set forth: Provided, That the infringement takes place at the moment any of the acts stated in Subsection 155.1 or this subsection are committed regardless of whether there is actual sale of goods or services using the infringing material.

The evidence presented by Harvey Tan, Operations Manager of Pedro Domecq, S.A., indicated that the seized Fundador brandy had characteristics of counterfeiting, such as a BIR seal label that did not reflect the word “tunay” under black light, a “tamper evident ring” that did not contain the word Fundador, and a flat, sharply edged print of the word Fundador on the label, unlike the raised, embossed, and finely printed genuine trademark. These findings demonstrated that Batistis attempted to deceive the public by making the counterfeit products appear genuine. By imitating the registered Fundador trademark, Batistis committed infringement of trademark as defined in Section 155 of the Intellectual Property Code.

Lastly, the Supreme Court addressed the penalty imposed by the lower courts. Section 170 of the Intellectual Property Code provides the penalty for infringement of trademark:

Section 170. Penalties. – Independent of the civil and administrative sanctions imposed by law, a criminal penalty of imprisonment from two (2) years to five (5) years and a fine ranging from Fifty thousand pesos (P50,000) to Two hundred thousand pesos(P200,000), shall be imposed on any person who is found guilty of committing any of the acts mentioned in Section 155, Section 168 and Subsection 169.1. (Arts. 188 and 189, Revised Penal Code).

The CA affirmed the RTC’s decision, which imposed a penalty of two years imprisonment and a fine of P50,000.00. The Supreme Court found that this fixed penalty was contrary to the Indeterminate Sentence Law, which mandates that the penalty should be an indeterminate sentence. Section 1 of the Indeterminate Sentence Law states:

Section 1. Hereafter, in imposing a prison sentence for an offense punished by the Revised Penal Code, or its amendments, the court shall sentence the accused to an indeterminate sentence the maximum term of which shall be that which, in view of the attending circumstances, could be properly imposed under the rules of the said Code, and the minimum which shall be within the range of the penalty next lower to that prescribed by the Code for the offense; and if the offense is punished by any other law, the court shall sentence the accused to an indeterminate sentence, the maximum term of which shall not exceed the maximum fixed by said law and the minimum shall not be less than the minimum term prescribed by the same.

Therefore, the Supreme Court modified the penalty to imprisonment ranging from two years, as minimum, to three years, as maximum, and a fine of P50,000.00, aligning it with the requirements of the Indeterminate Sentence Law.

FAQs

What is trademark infringement?	Trademark infringement occurs when someone uses a registered trademark, or a similar mark, without permission, in a way that is likely to cause confusion among consumers.
What is the Indeterminate Sentence Law?	The Indeterminate Sentence Law requires courts to impose a sentence with a minimum and maximum term, rather than a fixed term, to allow for parole based on the prisoner’s behavior. This law aims to promote rehabilitation and reduce the unnecessary deprivation of liberty.
What evidence was used to convict Juno Batistis?	The evidence included testimonies from NBI agents who conducted the test-buy and search, along with seized items such as counterfeit brandy bottles, boxes, and plastic caps. Expert testimony also highlighted the differences between the counterfeit and genuine Fundador products.
Why was Batistis acquitted of unfair competition?	The Court of Appeals acquitted Batistis of unfair competition because the prosecution failed to prove his guilt beyond a reasonable doubt for that specific charge. The focus shifted to the clearer evidence of trademark infringement.
What factors did the Supreme Court consider in affirming the conviction?	The Court considered the factual findings of the lower courts, the evidence of counterfeiting, and the intent to deceive the public. It emphasized that appeals to the Supreme Court should only raise questions of law.
How did the Supreme Court modify the penalty?	The Supreme Court modified the penalty to comply with the Indeterminate Sentence Law, imposing a sentence of imprisonment ranging from two years (minimum) to three years (maximum), along with a fine of P50,000.00.
What is the significance of registering a trademark?	Registering a trademark gives the owner exclusive rights to use the mark, protecting their brand identity and preventing others from profiting from their reputation. Registration also makes it easier to pursue legal action against infringers.
What should consumers look for to avoid buying counterfeit products?	Consumers should carefully examine product packaging, seals, and labels for inconsistencies or signs of tampering. Purchasing from authorized retailers and being wary of unusually low prices can also help avoid counterfeit products.

This case underscores the Philippines’ commitment to protecting intellectual property rights and penalizing those who engage in trademark infringement. By applying the Indeterminate Sentence Law, the Supreme Court ensures a fair and just penalty that aligns with the principles of rehabilitation and proportionality. Counterfeit goods not only harm legitimate businesses but also deceive consumers, making the enforcement of trademark laws crucial for maintaining a fair and trustworthy marketplace.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Juno Batistis v. People, G.R. No. 181571, December 16, 2009