IPR violations

Every time I go to a convenience store, I see this automated payment machine (APM) terminal called TouchPay. The machine can be used to load up electronic wallets and cards, for cashing in and for paying bills, among others.

Once, I used a TouchPay kiosk to load my EasyTrip and AutoSweep accounts. That was before I discovered that I could load using my Maya or GCash e-wallets.

A company called MEPS or the Manila Express Payments Inc. owns and operates these TouchPay machines. There are around 3,000 of these APMs nationwide, and MEPS is targeting to increase this to 10,000 by 2026.

I later learned that MEPS has actually gone to court and other venues in a bid to protect its intellectual property rights over a system or process used in the machines, which is covered by a utility model registration issued by the Bureau of Patents.

MEPS has been engaged in a long, drawn-out battle against Electronic Transfer & Advance Processing Inc. (eTAP), which MEPS claims has copied its system which it installed in machines under the brand name Pay&Go, and which is owned and operated by BTI Payments Philippines. eTAP has denied the MEPS’ claims.

Fortunately, MEPS has been winning the battle so far.

Just like TouchPay, Pay&Go is a self-service kiosk that is capable of accepting cash for bills payments, mobile top-up and e-money cash-in, among others.

Just last May, the Intellectual Property Office (IPOPhl)’s Bureau of Legal Affairs (BLA) granted a petition filed by MEPS for the cancellation of the utility model registration issued by IPO’s Bureau of Patents covering a system of servicing financial transactions by electronic means being used by eTAP.

As I understand it, both MEPS and eTAP did not invent the systems that they use for their machines. Instead, the utility model registrations were assigned to them by the owners/inventors.

According to MEPS, eTAP was deploying machines that use a system or process that is exactly the same as the claimed inventions covered by the utility model registration assigned to MEPS.

Under our IP laws, a utility model registered with the Bureau of Patents must be new or novel, and must be industrially applicable, although not as inventive as a product or process being applied for patent registration.

But any interested person may petition the BLA for the cancellation of the utility model registration on the ground that what is claimed as the invention is not new.

The BLA ruled in favor of MEPS when it granted the petition to cancel the utility model registration earlier issued to the inventors of the system that was assigned to eTAP on the ground that the said invention was no longer new or novel, which is a requirement for the issuance of a utility model registration.

This has also prompted MEPS to file a civil case for infringement and damages with the RTC of Parañaque against eTAP.

MEPS claimed that there were several machines powered by eTAP under the label Pay&Go which used a system or utility model exactly similar to the utility model registration of MEPS. The Pay&Go kiosks are owned and operated by BTI Payments Philippines Inc.

MEPS, in its complaint with the Parañaque RTC, claimed that eTAP has infringed MEPS’ utility model when it used a system flow in its machines which it said is an exact copy of what was used in the machines being distributed by MEPS, a system flow that is protected by a duly registered utility model.

In September last year, the court ordered eTAP to pay MEPS exemplary damages and attorney’s fees.

According to the court, both utility models of MEPS and eTAP describe their system as a method of remitting payments through an automated payment machine comprising the steps of choosing a service provider and its services through the interface of said APM, providing details of payment using the virtual keyboard on the said interface, remitting payments on said APM, validating said payment details, accepting payment through said machine and issuing a confirmation receipt.

The RTC ruled that since the process being used by eTAP performs substantially the same function in substantially the same way to substantially achieve the same result, which is the validation of payment and then confirmation of payment, eTAP’s machine is basically the same as that of MEPS, and therefore, there was infringement and a violation of MEPS’s IP rights as the assignee of the utility model registration.

Meanwhile, following the issuance of search warrants by the court, a total of 31 machines under the label Pay&Go and seven under the label Xytrix and ZoomPay owned and operated by Xytrix Systems Corp. were seized by the NBI.

eTAP has denied all the allegations made by MEPS though. In its answer to MEPS’ petition before the BLA, it argued that the inventions covered by its utility model registrations are patentable inventions and are new and novel and that they are not the same as ones belonging to MEPS.

Meanwhile, in the case brought before the RTC of Parañaque, eTAP argued that MEPS’ utility model is not patentable and even if it were, eTAP did not commit patent infringement as their process flow is very different from that of MEPS.

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