FAST BACKWARD: Legal battle over a patented machine

When Patrick Henry Frank, founder of Davao Light and Power Company (DLPC), hit upon the idea of inventing a machine that would make hemp stripping easy, fast, and efficient, there was promise the abaca industry would further flourish.

On December 16, 1924, Frank, who also owned Cotabato Light and Power Company (CLPC), registered it with the United States Patent Office as Patent No. 1519579, and on March 17,1925 listed it in the Bureau of Commerce and Industry in the Philippines.

To make use of the patent and manufacture the machine in quantity, Frank established the Universal Hemp Machine Company, with William Henry Gohn, a thriving American planter in Davao, as one of the major shareholders. Together they introduced and convinced Luzon hemp growers the patented stripping machine that “can clean hemp satisfactorily and economically.”

But to their surprise, they belatedly discovered some enterprising Japanese were already using a similar machine, prompting them to file a case in the lower court docketed as G.R. No. L-38010. The defendant was G. Kosuyama, a Japanese.

The suit stemmed from the alleged infringement of the rights and privileges acquired by the Americans as a result of the patent, claiming the defendant was producing and selling machines that were similar to Frank’s invention.

The Americans sought from the court to order the Japanese to cease the manufacture and sale of machines similar to the patented, to render an accounting of the profits realized from the machines in question, to pay the patent owner and partner the amount of P60.00 as profit for every machine sold, to post a bond in case of failure or refusal to account, and to sentence the Japanese to pay the cost and damages due to the Americans.

Sadly, the court favored the defendant by dismissing the complaint and the P10,000 counterclaim sought by the Japanese, who did not appeal.

In the amended complaint, the Americans claimed the machine’s following characteristics:

“A stripping head, a horizontal table, a stripping knife supported upon such table, a tapering spindle [the only feature cited in the original complaint, a rest holder adjustably secured on the table portion, a lever and means of compelling the knife to close upon the table, a pallet or rest in the bottom of the table, a resilient cushion under such palletor rest.”

Citing its December 21, 1933 verdict, the Supreme Court summarized the trial court’s findings based on evidences presented for appreciation:

“In constructing their machine the plaintiffs did nothing but improve, to a certain degree, those that were already in vogue and in actual us in hemp producing provinces. It cannot be said that they have invented the “spindle” inasmuch as this was already known since the year 1909 or 1910. Neither [can it] be said that they have invented the stripping knife and the contrivance which controls the movement and pressure thereof on the ground that stripping knives together with their control sets were already in actual use in the different stripping machines long before their machine appeared.

“Neither can it be said that they invented the fly wheel because that part or piece thereof, so essential in every machine from time immemorial, was already known and actually employed in hemp stripping machines… were in use for the benefit of hemp long before the appearance of the plaintiffs’ machines in the market. Much less can it be said that they invented the pedal to raise the knife in order to allow the hemp to be stripped to pass under it, on the ground that the use of such contrivance has, likewise, been known since the invention of the most primitive of hemp stripping machines.”

To support their ownership of patent, Frank and Gohn invoked the doctrine invoked in the case of Frank and Gohn vs. Benito (51 Phil., 712), where the defendant was found to have infringed upon the patent of the Americans. However, the high court argued:

“[The] plaintiffs in the former and those of the latter case are the same and that the patent then involved is the very same one upon which the present action of the plaintiffs is based. The above-cited case, however, cannot be invoked as a precedent to justify a judgment in favor of the [Americans] on the ground that the facts in one case entirely different from those in the other. In the former case the defendant did not set up the same special defenses as those alleged by the herein defendant in his answer and the plaintiffs therein confined themselves to presenting the patent, or rather a copy thereof, wherein the ‘spindle’ was mentioned, and this court took for granted their claim that it was one of the essential characteristics thereof which was imitated or copied by the then defendant.”

The high tribunal, with finality, declared “the [Japanese] cannot be held civilly liable for alleged infringement of the patent upon which the present action is based on the ground that there is no essential part of the machine manufactured and sold by him, which was unknown to the public in the Province of Davao at the time the plaintiffs applied for and obtained their patent for improved hemp stripping machines, the judgment appealed from is hereby affirmed.”

The Americans lost.