G.R. No. 181571 - Batistis vs. People

Case Summary (G.R. No. 181571)

Relevant Dates and Procedural Posture

Test-buy and investigatory activities preceded issuance of a search warrant.
Search warrant issued December 20, 2001; seizure and inventory conducted the same day.
Information filed; accused pleaded not guilty; trial at RTC resulted in conviction on January 23, 2006 for both trademark infringement and unfair competition.
CA partially affirmed on September 13, 2007: affirmed conviction for Section 155 (infringement of trademark) and reversed conviction for Section 168 (unfair competition).
Petition for review on certiorari to the Supreme Court followed; the Supreme Court reviewed the CA decision (decision date in record: December 16, 2009).

Applicable Law and Constitutional Basis

Governing substantive provisions: Section 155 (infringement of trademark), Section 168 (unfair competition), and Section 170 (penalties) of the Intellectual Property Code (Republic Act No. 8293).
Penal sentencing framework: Indeterminate Sentence Law (Act No. 4103, as amended by Act No. 4225).
Appellate and procedural rules: Rule 45 (petition for review on certiorari) and Rule 122 (appeal matters) of the Rules of Court.
Constitutional backdrop: Because the final decision date in the record is after 1990, the 1987 Constitution governs the exercise of judicial power and the Supreme Court’s review authority over lower courts and administrative processes in this case.

Facts Established at Trial and Seizure Details

Allied Domecq Philippines, Inc., as exclusive distributor of Fundador brandy, initiated enforcement after NBI agents conducted a test-buy that indicated counterfeiting activity.
Based on agents’ application, Judge Antonio M. Eugenio, Jr. issued Search Warrant No. 01-2576 for Batistis’s premises. The executed search yielded a variety of items including 241 empty Fundador bottles, 163 Fundador boxes, a half sack of Fundador plastic caps, two filled bottles of Fundador brandy, and assorted empty bottles and cartons of other brands. A formal return and inventory were recorded.

Charges and Formal Information

Batistis was formally charged by the Office of the City Prosecutor with two offenses: (1) infringement of trademark under Section 155 and (2) unfair competition under Section 168 of the Intellectual Property Code.
The information alleged reproduction and sale of low-quality products given the general appearance and features of genuine Fundador brandy with intent to deceive the public and prejudice the private complainant.

RTC Findings and Sentencing

The RTC found Batistis guilty beyond reasonable doubt of both trademark infringement (Section 155) and unfair competition (Section 168).
The RTC imposed a straight sentence of two years imprisonment for each offense, fines of P50,000 for each count, ordered indemnification to the private complainant in the amount of P25,000 as actual damages, and ordered destruction of the seized items. Costs were charged against the accused.

Court of Appeals Ruling

The CA, on appeal, affirmed the conviction for infringement of trademark under Section 155 but reversed the conviction for unfair competition (Section 168) because the prosecution failed to prove guilt beyond reasonable doubt as to that offense.
The CA upheld the sentencing imposed by the RTC with respect to the conviction it affirmed.

Issues Raised on Supreme Court Review and Standard of Review

Issues Raised on Appeal and Standard of Review

Batistis argued that conviction rested on self-serving testimony of investigating officers; contested presence at search; failure of one NBI agent to immediately identify him in court; and that most confiscated items were not found in his house.
The Supreme Court emphasized procedural limits: a petition for review on certiorari under Rule 45 raises only questions of law. Factual and evidentiary disputes that require re-appreciation of trial evidence are beyond the Court’s scope except in exceptional circumstances (e.g., findings that are mistaken, absurd, speculative, conflicting, tainted with grave abuse of discretion, or contrary to the findings of the court of origin). The petition was therefore primarily confined to review of legal errors by the CA, and the Court declined to disturb affirmed factual findings absent exceptional circumstances.

Analysis of Evidence Supporting Trademark Infringement

The Supreme Court reviewed the trial and CA assessment of evidence relevant to Section 155. Testimony of Harvey Tan (operations manager for Pedro Domecq, S.A.), who examined the seized items and compared them to genuine Fundador products, identified indicia of counterfeiting: absence of the word “tunay” under black light on the BIR seal, absence of “Fundador” on the tamper-evident ring, and flat (not embossed) printing of the Fundador name with sharper edges inconsistent with genuine labeling. Exhibits corroborated the presence of counterfeit features.
Under Section 155, reproducing or applying a colorable imitation of a registered mark to containers, labels or packaging in connection with sale or distribution, where such use is likely to cause confusion or deception, constitutes infringement. The Court concluded that Batistis applied dominant features of the Fundador mark to counterfeit products and that the two filled bottles and other material demonstrated efforts to imitate the genuine articles to deceive consumers—thus meeting the statutory standard for infringement.

Disposition on the Unfair Competition Count

The CA had already reversed the conviction under Section 168 for failure of the prosecution to prove guilt beyond reasonable doubt; the Supreme Court affirmed the CA’s disposition by affirming the CA decision insofar as it related to Section 155 and by not disturbing the CA’s acquittal on Section 168.

Penalty: Indeterminate Sentence Law and Modification

Section 170 of the Intellectual Property Code prescribes criminal penalties for Section 155 offenses: imprisonment from two to five years and fines ranging from P50,000 to P200,000. The RTC and CA had imposed a straight penalty of two years imprisonment and a P50,000 fine.
The Supreme Court held that the imposition of a straight pen

Case Syllabus (G.R. No. 181571)

Case Caption, Citation and Decision

Citation: 623 Phil. 246, First Division, G.R. No. 181571, December 16, 2009.
Parties: JUNO BATISTIS, Petitioner; PEOPLE OF THE PHILIPPINES, Respondent.
Decision authored by Justice BERSAMIN; concurrence by Puno, C.J. (Chairperson), Carpio Morales, Leonardo-De Castro, and Villarama, Jr., JJ.
Relief sought: Petition for review on certiorari from the decision of the Court of Appeals (CA) affirming conviction for infringement of trademark and reversing conviction for unfair competition.
Final disposition summarized: Supreme Court affirmed conviction for infringement of trademark (Section 155, Intellectual Property Code) but modified the penalty to an indeterminate sentence of imprisonment ranging from two years (minimum) to three years (maximum) and imposed a fine of P50,000.00; costs of suit to be paid by the accused.

Procedural History

Trial court: Regional Trial Court (RTC), Branch 24, Manila.
- Date of RTC conviction: January 23, 2006.
- RTC conviction: Found Juno Batistis guilty beyond reasonable doubt of violations of Section 155 (infringement of trademark) and Section 168 (unfair competition) of the Intellectual Property Code; imposed two years imprisonment and fine of P50,000.00 for each offense; ordered indemnity to private complainant of P25,000.00; ordered destruction of seized items; costs against accused.
Court of Appeals (CA):
- Date of CA decision: September 13, 2007.
- CA ruling: Affirmed conviction for violation of Section 155 (infringement of trademark); acquitted the accused of violation of Section 168 (unfair competition) for failure of the prosecution to prove guilt beyond reasonable doubt.
- CA disposition language: “The Appeal of Appellant JUNO BATISTIS is hereby PARTIALLY GRANTED. The challenged Decision is AFFIRMED in so far as the charge against him for Violation of Section 155 of the Intellectual Property Code is concerned. However, for failure of the prosecution to prove to a moral certainty the guilt of the said Appellant, for violation of Section 168 of the same code a judgment of ACQUITTAL is hereby rendered in his favor.”
Supreme Court:
- Mode of appeal: Petition for review on certiorari (Rule 45) raising only questions of law.
- Supreme Court action: Petition denied insofar as challenging the CA’s affirmation of infringement; conviction affirmed but penalty modified to conform with the Indeterminate Sentence Law; reasons and legal analysis provided.

Antecedent Facts and Background of Trademark

Fundador trademark:
- Characterized brandy products manufactured by Pedro Domecq, S.A. of Cadiz, Spain.
- Registration: Duly registered in the Principal Register of the Philippines Patent Office on July 12, 1968 under Certificate of Registration No. 15987 for a term of 20 years from November 5, 1970; registration renewed for another 20 years effective November 5, 1990.
Complainant and distribution:
- Allied Domecq Philippines, Inc., a Philippine corporation, was exclusively authorized to distribute Fundador brandy products imported from Spain wholly in finished form.
- Allied Domecq Philippines, Inc. initiated the case against Batistis.
Investigation:
- Agents of the National Bureau of Investigation (NBI) conducted a test-buy at Batistis’ premises and confirmed he was actively engaged in the manufacture, sale and distribution of counterfeit Fundador brandy products.
- Based on positive test-buy results, the NBI applied for and obtained Search Warrant No. 01-2576 from Judge Antonio M. Eugenio, Jr., RTC Manila, issued December 20, 2001, authorizing search of Batistis’ premises at No. 1664 Onyx St., San Andres Bukid, Sta. Ana, Manila.

Items Seized and Inventory

Items recovered and listed on the return/receipt:
- 20 empty Carlos I bottles.
- 10 empty Black Label bottles.
- 2 empty bottles of Johnny Walker Swing.
- 1 empty bottle of Remy Martin XO.
- 1 empty bottle of Chabot.
- 241 empty Fundador bottles.
- 163 boxes of Fundador.
- One half sack of Fundador plastic caps.
- 2 filled bottles of Fundador brandy.
- 8 cartons (boxes) of empty Jose Cuervo bottles.
The seized items were the subject of orders for destruction by the trial court pursuant to existing rules and regulations.

Formal Information and Charges

Formal information filed in the RTC charged Batistis with two separate offenses:
- Infringement of trademark (Section 155, Intellectual Property Code).
- Unfair competition (Section 168, Intellectual Property Code).
Essence of allegations (as recited in the information):
- That on or about December 20, 2001, in Manila, Batistis was in possession of 241 empty Fundador bottles, 163 Fundador boxes, one half sack of Fundador plastic caps, and two Fundador bottles, with intent to deceive and defraud the public and Allied Domecq Philippines, Inc.
- That Batistis willfully, unlawfully and feloniously reproduced, sold and offered for sale, without prior authority and consent of the manufacturing company, a low quality product given the general appearance and other features of the original Fundador Brandy likely to induce the public to believe they were the real Fundador Brandy, to the damage and prejudice of Allied Domecq and the public.
Plea: Batistis pleaded not guilty on June 3, 2003.

Trial Court Findings and Orders (RTC Decision)

RTC findings (January 23, 2006):
- Found accused Juno Batistis guilty beyond reasonable doubt of violation of Section 155 (infringement of trademark) and Section 168 (unfair competition).
RTC sentences and orders:
- Imposed imprisonment of TWO (2) YEARS and a fine of FIFTY THOUSAND PESOS (P50,000.00) for each count.
- Ordered indemnification to private complainant in the sum of TWENTY-FIVE THOUSAND PESOS (P25,000.00) as actual damages.
- Ordered destruction of the specified seized items (listed in the RTC decision); costs against accused.

Court of Appeals Resolution

CA disposition (September 13, 2007):
- Affirmed RTC conviction for violation of Section 155 (infringement of trademark).
- Reversed RTC conviction for violation of Section 168 (unfair competition), acquitting Batistis of that charge for failure of the prosecution to prove guilt beyond reasonable doubt.
- CA order: Partial grant of appellant’s appeal—affirmance as to Section 155; acquittal as to Section 168.

Issues Raised by Petitioner on Supreme Court Appeal

Principal contention advanced by Batistis:
- RTC erred in convicting the accused on the basis of the self-serving affidavits and testimonies of NBI officers who conducted the raid.
Specific factual arguments asserted by Batistis:
- The only direct proofs of guilt were self-serving testimonies of the NBI raiding team.
- Batistis was not present during the search.
- One of the NBI raiding agents failed to immediately identify Batistis in court.
- Aside from the two bottles of Fundador brandy, the rest of the confiscated items were not found in his house.
Procedural posture of the petition:
- The appeal to the Supreme Court was by petition for review on certiorari, which raises only questions of law under Section 1, Rule 45 of the Rules of Court.

Supreme Court's Threshold Rulings on Appealability and Scope

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