Francisco Joaquin vs Franklin Drilon GR No.
108946, January 28, 1999
Facts:
BJ Productions, Inc (BJPI) is a holder of a Certificate of Copyright no. M922 issued on January 28, 1971 of
“Rhoda and Me” which is a dating show aired from 1970 to 1977. It submitted to the National Library an
addendum its certificate of copyright specifying the show’s format and style of presentation. While
watching the television, its President, Francisco Joaquin saw on RPN Channel 9 the episode on “It’s a Date”
produced by IXL Productions. He wrote a letter to IXL’s president Gabriel Zosa informing him that BJPI has
a copyright of the same format as shown on their “It’s a Date” show in their “Rhoda and Me” show. Zosa
sought to register IXL’s copyright to their first episode of “It’s a Date” to the National Library. Petitioner
filed a complaint in violation of PD No. 49 against the respondent before the RTC of Quezon City.
Respondent sought a review of the resolution from the Asst. City Prosecutor before the Department of
Justice.
Sec. of Justice Franklin Drilon directed to move for dismissal of the case against the respondents and
denied the petitioner’s motion for reconsideration hence this petition before the Supreme Court.
Issue:
Whether or not the format or mechanics of the petitioner’s television show is entitled to a copyright
protection.
Ruling:
The Supreme Court held that the format of a show is not copyrightable as provided by Section 2 of PD no.
49 otherwise known as the Decree on Intellectual Property which enumerates the classes of work that are
covered by the copyright protection. Similarly, RA 8293, the Intellectual Property Code of
the Philippines provides that format or mechanics of a television show is not included in the list of the
protected work by the copyright law of the Philippines. PD 49 enumerates the works subject to copyright
protection which refers to finished works and not on concepts. It does not extend to an idea, procedure,
process, system, method or operation, concept, principles or discovery regardless of the form to which it
is described, explained, and illustrated or embodied in the work.
FRANCISCO G. JOAQUIN, JR. and BJ PRODUCTIONS, INC. vs. HONORABLE RANKLIN M. DRILON, GABRIEL
ZOSA, WILLIAM ESPOSO, FELIPE MEDINA, JR., and CASEY FRANCISCO
FACTS:
Petitioner BJ Productions, Inc. (BJPI) is the holder / grantee of Certificate of Copyright No. M922,
dated January 28, 1971, of Rhoda and Me, a dating game show aired from 1970 to 1977.
MASAOY,QMM
On June 28, 1973, petitioner BJPI submitted to the National Library an addendum to its certificate
of copyright specifying the show’s format and style of presentation.
Upon complaint of petitioners, information for violation of PD No. 49 was filed against private
respondent Zosa together with certain officers of RPN 9 for airing It’s a Date. It was assigned to Branch
104 of RTC Quezon City.
Zosa sought review of the resolution of the Assistant City Prosecutor before the Department of
Justice.
On August 12, 1992, respondent Secretary of Justice Franklin M. Drilon reversed the Assistant City
Prosecutor’s findings and directed him to move for the dismissal of the case against private respondents.
Petitioner Joaquin filed motion for reconsideration but such was denied.
ISSUE:
Whether the format or mechanics or petitioner’s television show is entitled to copyright protection.
HELD:
The Court ruled that the format of the show is not copyrightable. Sec. 2 of PD No. 49, otherwise
known as the Decree on Intellectual Property, enumerates the classes of work entitled to copyright
protection. The provision is substantially the same as Sec. 172 of the Intellectual Property Code of
the Philippines (RA 8293). The format or mechanics of a television show is not included in the list of
protected works in Sec. 2 of PD No. 49. For this reason, the protection afforded by the law cannot be
extended to cover them.
Copyright, in the strict sense of the term, is purely a statutory right. It is a new independent right granted
by the statute and not simply a pre-existing right regulated by the statute. Being a statutory grant, the
rights are only such as the statute confers, and may be obtained and enjoyed only with respect to the
subjects and by the person and on terms and conditions specified in the statute.
The Court is of the opinion that petitioner BJPI’s copyright covers audio-visual recordings of each episode
of Rhoda and Me, as falling within the class of works mentioned in PD 49.
The copyright does not extend to the general concept or format of its dating game show.
Mere description by words of the general format of the two dating game shows is insufficient; the
presentation of the master videotape in evidence was indispensable to the determination of the existence
of a probable cause.
A television show includes more than mere words can describe because it involves a whole spectrum of
visuals and effects, video and audio, such that no similarity or dissimilarity may be found by merely
describing the general copyright / format of both dating game shows.
IP CASE DIGESTS III-C Page 1 of 19
302 SCRA 225 – Mercantile Law – Intellectual Property – Law on Copyright – Game Show – Ideas and
Concepts Not Covered by Copyright – Presentation of the Master Tape

BJ Productions Inc. (BJPI) was the holder of copyright over the show Rhoda and Me. It holds rights over
the show’s format and style of presentation. In 1991, BJPI’s president Francisco Joaquin saw on TV – RPN
9’s show It’s a Date, a show which is basically the same as Rhoda and Me. He eventually sued Gabriel Zosa,
the manager of the show It’s a Date. The investigating prosecutor found probable cause against Zosa. Zosa
later sought a review of the prosecutor’s resolution before the Secretary of Justice (Franklin Drilon). Drilon
reversed the findings of the fiscal and directed him to dismiss the case against Zosa.

ISSUE: Whether or not the order of Drilon finding no probable cause is valid.

HELD: Yes. The essence of copyright infringement is the copying, in whole or in part, of copyrightable
materials as defined and enumerated in Section 2 of PD. No. 49 (Copyright Law). Apart from the manner
in which it is actually expressed, however, the idea of a dating game show is a non-copyrightable
material. Ideas, concepts, formats, or schemes in their abstract form clearly do not fall within the class
of works or materials susceptible of copyright registration as provided in PD. No. 49. What is covered by
BJPI’s copyright is the specific episodes of the show Rhoda and Me.

Further, BJPI should have presented the master videotape of the show in order to show the linkage
between the copyright show (Rhoda and Me) and the infringing show (It’s a Date). This is based on the
ruling in 20th Century Fox vs CA (though this has been qualified by Columbia Pictures vs CA, this is still good
law). Though BJPI did provide a lot of written evidence and description to show the linkage between the
shows, the same were not enough. A television show includes more than mere words can describe because
it involves a whole spectrum of visuals and effects, video and audio, such that no similarity or dissimilarity
may be found by merely describing the general copyright/format of both dating game shows.

MASAOY,QMM IP CASE DIGESTS III-C Page 2 of 19

Pearl & Dean (Phil), Inc. vs Shoemart, Inc. These were marketed in the name of "Poster Ads". They also applied for a registration of trademark with
the Bureau of Patents in 1983, but was only approved in 19988. In 1985, petitioner had n agreement with
409 SCRA 231 – Mercantile Law – Intellectual Property – Law on Copyright – Copyrightable Subject respondent Shoemart Inc (SMI) to install these light boxes in their Makati and Cubao branch, Only the
Pearl & Dean (Phil), Inc. is a corporation engaged in the manufacture of advertising display units called Makati branch was able to sigh the agreement. In 1986, the contract was rescinded unilaterally by SMI,
light boxes. In January 1981, Pearl & Dean was able to acquire copyrights over the designs of the display and instead contracted with Metro Industrial Services. They installed these lightboxes in different SM city
units. In 1988, their trademark application for “Poster Ads” was approved; they used the same trademark branches, including Cubao and Makati, with association with North Edsa Marketing Inc (NEMI), SMI's sister
to advertise their light boxes. company. Petitioner requested SMI and NEMI to put down their installations of the light boxes, and
payment of compensatory damages worth P20M. Claiming that respondents failed to comply, they filed a
In 1985, Pearl & Dean negotiated with Shoemart, Inc. (SM) so that the former may be contracted to install case for infringement of trademark and copyright, unfair competition and damages. RTC ruled in favor of
light boxes in the ad spaces of SM. Eventually, SM rejected Pearl & Dean’s proposal. petitioner, but CA reversed.
Two years later, Pearl & Dean received report that light boxes, exactly the same as theirs, were being used
by SM in their ad spaces. They demanded SM to stop using the light boxes and at the same time asked for
damages amounting to P20 M. SM refused to pay damages though they removed the light boxes. Pearl
& Dean eventually sued SM. SM argued that it did not infringe on Pearl & Dean’s trademark because Pearl ISSUES:
& Dean’s trademark is only applicable to envelopes and stationeries and not to the type of ad spaces
(1) Whether there was a copyright infringement
owned by SM. SM also averred that “Poster Ads” is a generic term hence it is not subject to trademark
(2) Whether there was a patent infringement
registration. SM also averred that the actual light boxes are not copyrightable. The RTC ruled in favor of
(3) Whether there was a trademark infringement
Pearl & Dean. But the Court of Appeals ruled in favor of SM.
(4) Whether there was unfair competition
ISSUE: Whether or not the Court of Appeals is correct.

HELD: Yes. The light boxes cannot, by any stretch of the imagination, be considered as either prints,
pictorial illustrations, advertising copies, labels, tags or box wraps, to be properly classified as a RULING: No to all.
copyrightable; what was copyrighted were the technical drawings only, and not the light boxes
themselves. In other cases, it was held that there is no copyright infringement when one who, without (1) Copyright is a statutory right, subject to the terms and conditions specified in the statute. Therefore, it
being authorized, uses a copyrighted architectural plan to construct a structure. This is because the can only cover the works falling within the statutory enumeration or description. Since the copyright was
copyright does not extend to the structures themselves. classified under class "O" works, which includes "prints, pictorial illustrations, advertising copies, labels,
tags and box wraps," and does not include the light box itself. A lightbox, even admitted by the president
On the trademark infringement allegation, the words “Poster Ads” are a simple contraction of the generic
of petitioner company, was neither a literary nor an artistic work but an engineering or marketing
term poster advertising. In the absence of any convincing proof that “Poster Ads” has acquired a
invention, thus not included under a copyright.
secondary meaning in this jurisdiction, Pearl & Dean’s exclusive right to the use of “Poster Ads” is limited
to what is written in its certificate of registration, namely, stationeries.
(2) Petitioner was not able to secure a patent for its lightboxes, and cannot legally prevent anyone from
PEARL & DEAN PHIL INC. VS. SHOEMART- Trademark, Copyright and Patents
manufacturing or commercially using the same. Patent has a three-fold purpose: a) to foster and reward
invention; b) promotes disclosures of invention and permit public to use the same upon expiration; c)
stringent requirements for patent protection to ensure in the public domain remain there for free use of
Trademark, copyright and patents are different intellectual property rights that cannot be interchanged
the public. Since petitioner was not able to go through such examination, it cannot exclude others from
with one another. A trademark is any visible sign capable of distinguishing the goods or services of an
manufacturing, or selling such lightboxes. No patent, no protection.
enterprise and shall include a stamped or marked container of goods. The scope of a copyright is confined
to literary and artistic works which are original intellectual creations in the literary and artistic domain.
Patentable inventions refer to any technical solution of a problem in any field of human activity which is
new, involves an inventive step and is industrially applicable. (3) The certificate of registration issued by the Director of Patents gives exclusive right to use its own
symbol only to the description specified in the certificate. It cannot prevent others to use the same
trademark with a different description.

FACTS:
(4) "Poster Ads" is a general term that cannot be associated specifically to Pearl and Dean, thus it cannot
Pearl and Dean is a corporation in the manufacture of advertising display units also known as light boxes, be considered to use such term to be unfair competition against the petitioner.
which were manufactured by Metro Industrial Services. A copyright Registration was obtained in 1981.

MASAOY,QMM IP CASE DIGESTS III-C Page 3 of 19

Pearl and Dean Inc. v Shoemart Inc. GR No. 148222, August 15, 2003

Ruling:

Facts:

Plaintiff P and D is engaged in manufacturing advertising display units called as light boxes. These are
specialty printed posters with plastic sheets and illuminated back lights that are mainly used as
stationeries. They secure copyright registration over these advertising light boxes and marketed using the
trademark “poster ads.” They applied for the registration of trademark before the Bureau of Patents,
Trademark and Technology Transfer which was approved on September 12, 1988. P and D negotiated with
the defendant Shoemart for the lease and installation of the light boxes in SM City North Edsa but was
given an alternative to have them leased to SM Makati and SM Cubao while the said branch was under
construction. Only the contract with SM Makati was returned with signature. In 1986 the counsel of
Shoemart informed P and D that it is rescinding its contract for SM Makati due to non-performance of the
terms thereof. Two years later, the Metro Industrial Services, the same company contracted by the plaintiff
to fabricate their display units offered to construct light boxes for the Shoemart chain of stores wherein
10 light boxes were created for them. Upon the termination of contract with Metro Industrial Service, SM
hired EYD Rainbow Advertising Co. to make light boxes. When P and D knew about the exact copies of its
light boxes installed at SM City branches in 1989, it investigated and found out that North Edsa Marketing
Inc (NEMI), sister company of SM was primarily selling ad space in lighted display units. P and D sent letter
to both NEMI and SM enjoining them to cease from using the subject light boxes and remove them from
SM establishments. It also demanded to discontinue the use of its trademark “poster ads” with
compensatory damages of 20M. SM suspended the lease of light boxes in its branches while NEMI took
down its advertisement for poster ads. Claiming both failed to meet its demand P and D filed a case for
infringement of trademark, copyright, unfair competition and damages.
It held that the petitioner never secured patent for the light boxes. Without any acquired rights to protect
its invention it cannot legally prevent anyone from manufacturing the same. There can be no infringement
of a patent until a patent has been issued, since whatever right one has to the invention covered by the
patent arises alone from the grant of patent. Inventors have no common law right to monopoly of his
work. He has the right to invent but once he voluntarily discloses it the world is free to copy and use it. A
patent gives the inventor the exclusive right to make, sell, use and exclude others from using his invention.
Assuming the petitioner’s ad units were patentable, he made them public by submitting its engineering
drawings to the National Library. To legally preclude others from copying and profiting from one’s
invention, patent is a primary requirement. The ultimate goal of a patent system is to bring new designs
and technologies into the public domain through disclosure. Ideas, once disclosed to the public without
the protection of a valid patent, are subject to appropriation without significant restraint. Therefore,
without any patent secured to protect one’s work, there is no protection against its use by the public.
Petitioner mainly secured copyright in which its design is classified as class “O” limited to box wraps,
pictorial illustration, labels and tags. Thus its copyright is covered only the works falling within this
category. Moreover, the term “poster ads” is generic and incapable to be used as trademark thus the
respondents are not held guilty of the charges against them.

SM denied the charges against it and noted that the registration of mark “poster ads” is limited to
stationeries like letterhead and envelope. It further stresses that it independently develop its own poster
panels using techniques and available technology without notice to P and D copyright. It further contends
that “poster ads” is a generic name that cannot be appropriated for a trademark and that P and D’s
advertising display units contained no copyright notice in violation of Section 27 of P.D. 49. NEMI
likewise repleaded the averments of SM and denied to have manufactured, installed or advertised the
display units. The RTC decided in favor of P and D but on appeal the Court of Appeals reversed its decision.
In its judgment its stand is that the copyright of the plaintiff is limited to its technical drawings only and
not the light boxes itself. When a drawing is technical, the copyright over the drawing does not extend
to actual object. Thus the CA is constrained to adopt the view of the respondents that the “poster ads” is
a generic poster term ads and in the absence of convincing proof that such wording acquired secondary
meaning, the P and D’s exclusive right to use “poster ads” is limited to what is written on its certificate of
registration which is stationaries.

Issue:

Whether or not there is patent infringement

MASAOY,QMM IP CASE DIGESTS III-C Page 4 of 19

ABS-CBN Broadcasting Corporation vs Philippine Multi-Media System, Inc.
576 SCRA 262 – Mercantile Law – Intellectual Property – Law on Copyright – Must-Carry Rule
Philippine Multi-Media System, Inc. (PMSI) is a signal provider which has cable and satellite services. It is
providing its satellite services through Dream Broadcasting System. PMSI has its “Free TV” and “Premium
Channels”. The Free TV includes ABS-CBN, GMA-7, and other local networks. The premium channels
include AXN, Jack TV, etc which were paid by subscribers before such channels can be transmitted as feeds
to a subscriber’s TV set which has been installed with a Dream satellite.
ABS-CBN is a television and broadcasting corporation. It broadcasts television programs by wireless means
to Metro Manila and nearby provinces, and by satellite to provincial stations through Channel 2 and
Channel 23. The programs aired over Channels 2 and 23 are either produced by ABS-CBN or purchased
from or licensed by other producers. ABS-CBN also owns regional television stations which pattern their
programming in accordance with perceived demands of the region. Thus, television programs shown in
Metro Manila and nearby provinces are not necessarily shown in other provinces.
In May 2002, ABS-CBN sued PMSI for allegedly engaging in rebroadcasting and thereby infringing on ABS-
CBN’s copyrights; that the transmission of Channels 2 and 23 to the provinces where these two channels
are not usually shown altered ABS-CBN’s programming for the said provinces. PMSI argued that it is not
infringing upon ABS-CBN’s copyrights because it is operating under the “Must-Carry Rule” outlined in NTC
(National Telecommunications Commission) Circular No. 4-08-88.
ISSUE: Whether or not PMSI infringed upon the copyrights of ABS-CBN.
HELD: No. The “Must-Carry Rule” under NTC Circular No. 4-08-88 falls under the limitations on copyright.
The Filipino people must be given wider access to more sources of news, information, education, sports
event and entertainment programs other than those provided for by mass media and afforded television
programs to attain a well informed, well-versed and culturally refined citizenry and enhance their socio-
economic growth. The very intent and spirit of the NTC Circular will prevent a situation whereby station
owners and a few networks would have unfettered power to make time available only to the highest
bidders, to communicate only their own views on public issues, people, and to permit on the air only those
with whom they agreed – contrary to the state policy that the (franchise) grantee like ABS-CBN, and other
TV station owners and even the likes of PMSI, shall provide at all times sound and balanced programming
and assist in the functions of public information and education.
PMSI was likewise granted a legislative franchise under Republic Act No. 8630, Section 4 of which similarly
states that it “shall provide adequate public service time to enable the government, through the said
broadcasting stations, to reach the population on important public issues; provide at all times sound and
balanced programming; promote public participation such as in community programming; assist in the
functions of public information and education.
The “Must-Carry Rule” favors both broadcasting organizations and the public. It prevents cable television
companies from excluding broadcasting organization especially in those places not reached by signal. Also,
the rule prevents cable television companies from depriving viewers in far-flung areas the enjoyment of
programs available to city viewers.
MASAOY,QMM
ABS-CBN V. PHILIPPINE MULTI-MEDIA SYSTEM (G.R. NO. 175769-70)
Facts:
Petitioner ABS-CBN, a broadcasting corporation, filed a complaint against respondent PMSI alleging that
the latter’s unauthorized rebroadcasting of Channels 2 and 23 infringed on its broadcasting rights and
copyright. PMSI posits that it was granted a franchise to operate a digital direct-to-home satellite service
and that the rebroadcasting was in accordance with the NTC memo to carry television signals of authorized
television broadcast stations, which includes petitioner’s programs. The IPO Bureau of Legal Affairs found
PMSI to have infringed petitioner’s broadcasting rights and ordered it to permanently desist from
rebroadcasting. On appeal, the IPO Director General found for PMSI. CA affirmed.
Issue:
Whether or not petitioner’s broadcasting rights and copyright are infringed.
Ruling: NO.
The Director-General of the IPO correctly found that PMSI is not engaged in rebroadcasting and thus
cannot be considered to have infringed ABS-CBN’s broadcasting rights and copyright.
Section 202.7 of the IP Code defines broadcasting as “the transmission by wireless means for the public
reception of sounds or of images or of representations thereof; such transmission by satellite is also
‘broadcasting’ where the means for decrypting are provided to the public by the broadcasting organization
or with its consent.” On the other hand, rebroadcasting as defined in Article 3(g) of the International
Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations,
otherwise known as the 1961 Rome Convention, of which the Republic of the Philippines is a signatory, is
“the simultaneous broadcasting by one broadcasting organization of the broadcast of another
broadcasting organization.” The Working Paper prepared by the Secretariat of the Standing Committee on
Copyright and Related Rights defines broadcasting organizations as “entities that take the financial and
editorial responsibility for the selection and arrangement of, and investment in, the transmitted content.”
Evidently, PMSI would not qualify as a broadcasting organization because it does not have the
aforementioned responsibilities imposed upon broadcasting organizations, such as ABS-CBN.
ABS-CBN creates and transmits its own signals; PMSI merely carries such signals which the viewers receive
in its unaltered form. PMSI does not produce, select, or determine the programs to be shown in Channels
2 and 23. Likewise, it does not pass itself off as the origin or author of such programs. Insofar as Channels
2 and 23 are concerned, PMSI merely retransmits the same in accordance with Memorandum Circular 04-
08-88. With regard to its premium channels, it buys the channels from content providers and transmits on
an as-is basis to its viewers. Clearly, PMSI does not perform the functions of a broadcasting organization;
thus, it cannot be said that it is engaged in rebroadcasting Channels 2 and 23.
ABS-CBN Broadcasting Corporation v Philippine Multi-Media System, Inc. G.R. Nos. 175769-70, January
19, 2009
ABS-CBN Broadcasting Corporation v Philippine Multi-Media System, Inc.
G.R. Nos. 175769-70, January 19, 2009
Facts:
Philippine Multi-Media System, Inc. (PMSI), operator of Dream Broadcsating System, delivers a digital
direct-to-home (DTH) television satellite to its subscribers all over the Philippines, was granted a legislative
IP CASE DIGESTS III-C Page 5 of 19
franchise under Republic Act 8630 and was given a Provisional Authority by the National cannot be considered within the purview of broadcasting.
Telecommunications Commission (NTC) to install, operate and maintain a nationwide DTH satellite service.
When it commenced operations, it offered as part of its program line-up, together with other paid Furthermore, there is no rebroadcasting on the part of the PMSI of the ABS-CBM’s programs on Channels
premium program channels, ABS-CBN Channels 2 and 23, NBN, Channel 4, ABC, Channel 5, GMA, Channel 2 and 23, as defined under the Rome Convention, which defines rebroadcasting as “the simultaneous
7, RPN, Channel 9, and IBC, Channel 13, pursuant to Memorandum Circular 4-08-88 which mandated all broadcasting by one broadcasting organization of the broadcast of another broadcasting organization.”
cable television system operators, operating within the Grade “A” and “B” CONTOURS to carry out the ABS-CBN creates and transmits its own signals; PMSI merely carries such signals which the viewers receive
television signals of the authorized television broadcast stations. in its unaltered form. PMSI does not produce, select, or determine the programs to be shown in Channels
2 and 23. Likewise, it does not pass itself off as the origin or author of such programs. Insofar as Channels
ABS-CBN Broadcasting Corporation (ABS-CBN), a licensed television and radio broadcasting network, 2 and 23 are concerned, PMSI merely retransmits the same in accordance with Memorandum Circular 04-
demanded PMSI to cease and desist from “rebroadcasting” Channels 2 and 23. In its reply, PMSI contended 08-88. With regard to its premium channels, it buys the channels from content providers and transmits on
that the “rebroadcasting” was in accordance with the authority granted by NTC under its obligations under an as-is basis to its viewers. Clearly, PMSI does not perform the functions of a broadcasting organization;
NTC MC 4-08-88. thus, it cannot be said that it is engaged in rebroadcasting Channels 2 and 23.

Negotiations were ensued between the parties in an effort to reach a settlement; however, the same was Therefore, the retransmission of ABS-CBN’s signals by PMSI – which functions essentially as a cable
terminated by ABS-CBN allegedly due to PMSI’s inability to ensure the prevention of illegal television – does not constitute rebroadcasting in violation of the former’s intellectual property rights
“retransmission” and further “rebroadcast” of its signals, as well as the adverse effect of the rebroadcasts under the IP Code.
on the business operations of its regional television stations.

ABS-CBN filed with the Intellectual Property Rights Office (IPO) a complaint for “Violation of Laws Involving 2. YES. The law on copyright is not absolute. The carriage of ABS-CBN’s signals by virtue of the must-carry
Property Rights, with Prayer for the Issuance of a Temporary Restraining Order and/or Writ of Preliminary rule in Memorandum Circular No. 04-08-88 is under the direction and control of the government though
Injunction” alleging that PMSI’s unauthorized rebroadcasting of Channels 2 and 23 infringed on its the NTC which is vested with exclusive jurisdiction to supervise, regulate and control telecommunications
broadcasting rights and copyright. The TRO was granted by the Bureau of Legal Affairs (BLA) of IPO. PMSI, and broadcast services/facilities in the Philippines. The imposition of the must-carry rule is within the NTC’s
pursuant to the TRO, suspended the retransmission of PMSI of Channels 2 and 23 and likewise filed a power to promulgate rules and regulations, as public safety and interest may require, to encourage a larger
petition for certiorari with the Court of Appeals. The Court of Appeals granted the petition of PMSI and and more effective use of communications, radio and television broadcasting facilities, and to maintain
reversed the decision of the BLA. ABS-CBN filed its appeal however it was dismissed by the Court of effective competition among private entities in these activities whenever the Commission finds it
Appeals. Furthermore, ABS-CBN’s motion for reconsideration was denied. reasonably feasible.

Issue:
1. Whether or not PMSI violated the Laws on Property Rights.
2. Whether or not the issuance MC 4-08-88 by the NTC is a valid exercise of the police power of the State.
Held:
1. NO. PMSI did not violate the Laws on Property Rights because it is not engaged in rebroadcasting
Channels 2 and 23. Rebroadcasting has been defined as “the simultaneous broadcasting by one
broadcasting organization of the broadcast of another broadcasting organization.” It is also “the
transmission by wireless means for the public reception of sounds or of images or of representations
thereof; such transmission by satellite is also ‘broadcasting’ where the means for decrypting are provided
to the public by the broadcasting organization or with its consent.” PMSI is only engaged in the carrying of
signals of ABS-CBN coming from ABS-CBN and transmitting signals. PMSI is not the origin nor does it claim
to be the origin of the programs broadcasted by the ABS-CBN. PMSI did not make and transmit on its own
but merely carried the existing signals of the ABS-CBN. When PMSI subscribers view ABS-CBN’s programs
in Channels 2 and 23, they know that the origin thereof was the ABS-CBN.
The nature of broadcasting is to scatter the signals in its widest area of coverage as possible. On this score,
it may be said that making public means that accessibility is undiscriminating as long as it is within the
range of the transmitter and equipment of the broadcaster. That the medium through which the PMSI
carries the ABS-CBN’s signal, that is via satellite, does not diminish the fact that it operates and functions
as a cable television. It remains that the PMSI’s transmission of signals via its DTH satellite television service
The “Must-Carry Rule” is in consonance with the principles and objectives underlying Executive Order No.
436, to wit:
The Filipino people must be given wider access to more sources of news, information, education, sports
event and entertainment programs other than those provided for by mass media and afforded television
programs to attain a well informed, well-versed and culturally refined citizenry and enhance their socio-
economic growth.
Moreover, radio and television waves are mere franchised which may be reasonably burdened with some
form of public service. It is a privilege subject, among other things, to amendment by Congress in
accordance with the constitutional provision that “any such franchise or right granted . . . shall be subject
to amendment, alteration or repeal by the Congress when the common good so requires.”
The must carry rule is a valid exercise of the police power of the State. It favors both broadcasting
organizations and the public. It prevents cable television companies from excluding broadcasting
organization especially in those places not reached by signal. Also, the rule prevents cable television
companies from depriving viewers in far-flung areas the enjoyment of programs available to city viewers.
In fact, this Office finds the rule more burdensome on the part of the cable television companies. The latter
carries the television signals and shoulders the costs without any recourse of charging. On the other hand,
the signals that are carried by cable television companies are dispersed and scattered by the television
stations and anybody with a television set is free to pick them up.

MASAOY,QMM IP CASE DIGESTS III-C Page 6 of 19

Bayanihan Music vs BMG
Facts:
Jose Mari Chan entered into a contract with petitioner Bayanihan, whereunder Chan assigned
Bayanihan all his rights. Interests and participation over his musical composition “Can We Just Stop and
Talk a While” and other musical composition “Afraid for Love to Fade”. Bayanihan applied for and was
granted a certificate of Copyright Registration.
Without knowledge and consent of Bayanihan, Chan authorized his co-respondent BMG records to
record and distribute the aforementioned musical compositions in a then recently released album of singer
Lea Salonga.
Bayanihan filed with RTC QC complaint against Chan and BMG for violation of 216 RA 8293.
BMG countered that the acts of recording and publication has been done and a TRO or
injunction would be moot and that there is no clear showing that Bayanihan will be greatly damaged by
the refusal of the prayer for TRO/injunction. BMG also pleaded a cross-claim against Chan for violation of
his warranty that his compositions are free from claims of third persons and counterclaim for damages
against Bayanihan.
Chan alleged that he never intended to divest himself of all his rights and interest over the musical
composition; that the contracts entered into with Bayanihan were mere music publications giving
Bayanihan as Assignees, the power to administer his copyright over his 2 songs and act as the exclusive
publisher; that he was not cognizant of application and grant of copyright certification over his 2 songs to
Bayanihan; and that Bayanihan was remiss of its obligations under the contract because it failed to
effectively advertise the songs for almost 20 years. Hence, the rescission of the contracts in 1997. Chan
also filed a counterclaim for damages against Bayanihan. RTC denied the TRO as well as the injunction. CA
affirmed RTC ruling.

Issue: When is the creator entitled to copyright protection?

Issue:
Ruling:
Whether Chan and BMG liable. Unquestionably, Chan being the composer and author of the lyrics of the 2 songs is protected
by the mere fact alone that he is the creator thereof, conformably with RA 8293, Sec. 172.2: Works are
protected by the sole fact of their creation, irrespective of their mode or form of expression, as well as of
their content and quality and purpose.
Ruling:
Also, as provided in the contracts Chan entered into with Bayanihan was the agreement that in
No. the event the publisher fails to use in any manner within 2 years any of the compositions covered by the
contract, the composition may be released in favor of the writer and excluded from the contract. The
Chan, the composer and author of the lyrics of the two songs, is protected by the mere fact alone publisher shall execute the necessary release in writing in favor of the writer upon the request of the
that he is the creator thereof. writer. It appears that the 2 contracts already expired, there being no allegation or proof that Bayanihan
ever made use of the compositions within the 20year period agreed upon.
IP CODE. 172. 2. Works are protected by the sole fact of their creation, irrespective of their mode
Anent the copyrights obtained on the basis of the contracts, suffice it to say that such purported
or form of expression, as well as their content, quality and purpose.
copyrights are not presumed to subsist in accordance with Sec. 218, RA 8293 because Chan had put in
issue the existence thereof.

GR 166337; March 7, 2005

Bayanihan Music v BMG Records and Jose Mari Chan

Facts:
Chan entered into a contract with Bayanihan, assigning all his rights, interests and participation
to Bayanihan for his song “Can We Just Stop and Talk a While” and after that, for the song “Afraid for Love
to Fade.” On the basis of such assignment, Bayanihan applied for and was granted by the National Library
a Certificate of Copyright Registration for each of the 2 musical compositions. Chan authorized BMG
Records to record and distribute both compositions in a then recently released album of Lea Salonga
without the knowledge of Bayanihan. Bayanihan informed Chan and BMG of its existing copyrights over
the songs and the alleged violation of such rights by the respondents, demanding to settle the matter but
no settlement was made.
Bayanihan filed before the Quezon City RTC a complaint against Chan and BMG for violation of
Sec. 216, RA 8293parying for the issuance of a TRO and/or writ of preliminary injunction enjoining BMG
from further recording an distributing the subject musical compositions in whatever form or musical
products, and Chan from further granting any authority to record and distribute the same musical
compositions.

MASAOY,QMM IP CASE DIGESTS III-C Page 7 of 19

MUNSINGWEAR CREATION MANUFACTURING COMPANY, respondent.

FACTS: Petitioner filed a petition to cancel the registration of respondent Munsingwear. The Patent Office
ruled in favor of Munsingwear in holding that a copyright registration like that of the name and likeness of
CHARLIE BROWN may not provide a cause of action for the cancellation of a trademark registration.

United filed an appeal of the above decision but it was dismissed for being filed out of time. The case was
then raised to the CA which upheld the Patent Office’s decision that the appeal was filed late. It was
further elevated to the SC on a petition for review on certiorari.

ISSUE: WON petitioner has a cause of action against respondent in the latter’s use of its comic character
in its ready to wear products. (YES)

RULING: PREMISES CONSIDERED, the Resolutions of the Court of Appeals dated September 16, 1985 and
October 14, 1986 dismissing petitioner's appeal are

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In Re: Plagiarism Charges Against Justice Mariano del Castillo (2010)
Intellectual Property Law – Copyright – Plagiarism
On April 28, 2010, the Supreme Court issued a decision which dismissed a petition filed by the Malaya
Lolas Organization in the case of Vinuya vs Romulo. Atty. Herminio Harry Roque Jr., counsel for Vinuya et
al, questioned the said decision. He raised, among others, that the ponente in said case, Justice Mariano
del Castillo, plagiarized three books when the honorable Justice “twisted the true intents” of these books
to support the assailed decision. These books were:
a. A Fiduciary Theory of Jus Cogens by Evan J. Criddle and Evan Fox-Descent, Yale Journal of International
Law (2009);
b. Breaking the Silence: Rape as an International Crime by Mark Ellis, Case Western Reserve Journal of
International Law (2006); and
c. Enforcing Erga Omnes Obligations by Christian J. Tams, Cambridge University Press (2005).
Justice del Castillo is not guilty of misconduct. The error here is in good faith. There was no malice, fraud
or corruption.
No Inexcusable Negligence
The error of Justice del Castillo’s researcher is not reflective of his gross negligence. The researcher is a
highly competent one. The researcher earned scholarly degrees here and abroad from reputable
educational institutions. The researcher finished third in her class and 4th in the bar examinations. Her
error was merely due to the fact that the software she used, Microsoft Word, lacked features to apprise
her that certain important portions of her drafts are being deleted inadvertently. Such error on her part
cannot be said to be constitutive of gross negligence nor can it be said that Justice del Castillo was grossly
negligent when he assigned the case to her. Further, assigning cases to researchers has been a long
standing practice to assist justices in drafting decisions. It must be emphasized though that prior to
assignment, the justice has already spelled out his position to the researcher and in every sense, the justice
is in control in the writing of the draft.

As such, Justice del Castillo is guilty of plagiarism, misconduct, and at least inexcusable negligence.

Interestingly, even the three foreign authors mentioned above, stated that their works were used
inappropriately by Justice Del Castillo and that the assailed decision is different from what their works In Re del Castillo, A.M. No. 10-7-17-SC, October 12, 2010
advocated.

ISSUE: Whether or not there is plagiarism in the case at bar. DECISION

HELD: No. Even if there is (as emphasized by the Supreme Court in its ruling on the Motion for PER CURIAM:
Reconsideration filed by Vinuya et al in 2011), the rule on plagiarism cannot be applied to judicial bodies.
I. THE FACTS
No Plagiarism

According to Black’s Law Dictionary: Plagiarism is the “deliberate and knowing presentation of another
person’s original ideas or creative expressions as one’s own.”
This cannot be the case here because as proved by evidence, in the original drafts of the assailed decision,
there was attribution to the three authors but due to errors made by Justice del Castillo’s researcher, the
attributions were inadvertently deleted. There is therefore no intent by Justice del Castillo to take these
foreign works as his own.
But in plagiarism, intent is immaterial.
In the landmark decision of Vinuya vs. Executive Secretary, G.R. No. 162230, promulgated last
April 28, 2010, the Supreme Court DISMISSED the petition filed by a group of Filipino “comfort women” during the
Japanese military occupation of the Philippines. The Court, speaking through Justice Mariano C. del Castillo, held that the
petition seeking to compel the Executive Department to espouse the petitioners’ claims for official apology
and other forms of reparations against Japan before the International Court of Justice and other
international tribunals has NO MERIT because: (1) the prerogative to determine whether to espouse petitioners’
claims against Japan belongs exclusively to the Executive Department; and (2) the Philippines is not under any
international obligation to espouse the petitioners’ claims.

On this note, the Supreme Court stated that in its past decisions, (i.e. U.P Board of Regents vs CA, 313
Discontented with the foregoing decision, the petitioners in Vinuya filed a motion for reconsideration.
SCRA 404), the Supreme Court never indicated that intent is not material in plagiarism. To adopt a strict
Subsequently, they also filed a supplemental motion for reconsideration, this time accusing the Justice del
rule in applying plagiarism in all cases leaves no room for errors. This would be very disadvantageous in
Castillo of plagiarizing (copying without attribution) and twisting passages from three foreign legal articles
cases, like this, where there are reasonable and logical explanations.
to support the Court’s position in the Vinuya decision:
On the foreign authors’ claim that their works were used inappropriately
(1) A Fiduciary Theory of Jus Cogens by Professors Evan J. Criddle (Associate Professor of Syracuse University
According to the Supreme Court, the passages lifted from their works were merely used as background
College of Law) and Evan Fox-Descent (Assistant Professor of McGill University Faculty of Law) published
facts in establishing the state on international law at various stages of its development. The Supreme Court
in the Yale Journal of International Law in 2009;
went on to state that the foreign authors’ works can support conflicting theories. The Supreme Court also
stated that since the attributions to said authors were accidentally deleted, it is impossible to conclude
(2) Breaking the Silence: Rape as an International Crime by Mark Ellis (Executive Director of the International
that Justice del Castillo twisted the advocacies that the works espouse.
Bar Association), published in the Case Western Reserve Journal of International Law in 2006; and
No Misconduct

MASAOY,QMM IP CASE DIGESTS III-C Page 9 of 19

(3) Enforcing Erga Omnes Obligations in International Law by Professor Christian J. Tams (Chair of International
Law of University of Glasgow School of Law), published in Cambridge University Press (2005).
The Court then referred the charges against Justice Del Castillo to its Committee on Ethics and
Ethical Standards, chaired by Chief Justice Renato Corona, for investigation and recommendation. After
the proceedings before it, the Committee submitted its findings and recommendations to the Court en
banc, which then treated and decided the controversy as an administrative matter.
II. THE ISSUES
1. Did Justice Del Castillo, in writing the opinion for the Court in the Vinuya case, plagiarize
the published works of authors Tams, Criddle-Descent, and Ellis?
2. Did Justice Del Castillo twist the works of these authors to make it appear that such works
supported the Court’s position in the Vinuya decision?
III. THE RULING
[By a 10-2 vote, with three Justices including Justice del Castillo taking no part, the
Court DISMISSED the charges for lack of merit and held that Justice del Castillo was NOT GUILTY of
plagiarizing and twisting the cited materials and hence did NOT commit gross negligence.]
1. NO, Justice Del Castillo, in writing the opinion for the Court in the Vinuya case, did NOT
plagiarize the published works of authors Tams, Criddle-Descent, and Ellis.
. 2. NO, Justice Del Castillo did NOT twist the works of authors Tams, Criddle-Descent, and
At its most basic, plagiarism means the theft of another person’s language, thoughts, or
ideas. To plagiarize, as it is commonly understood according to Webster, is “to take (ideas, writings, etc.)
from (another) and pass them off as one’s own.” The passing off of the work of another as one’s own is
thus an indispensable element of plagiarism.
As regards that one passage from Professor Tams, the Court believes that whether or not the
footnote is sufficiently detailed, so as to satisfy the footnoting standards of counsel for petitioners is not
an ethical matter but one concerning clarity of writing. The statement “See Tams, Enforcing
Obligations Erga Omnes in International Law (2005)” in the Vinuya decision is an attribution no matter if
Tams thought that it gave him somewhat less credit than he deserved. Such attribution altogether negates
the idea that Justice Del Castillo passed off the challenged passages as his own.
That it would have been better had Justice Del Castillo used the introductory phrase “cited in”
rather than the phrase “See” would make a case of mere inadvertent slip in attribution rather than a case
of “manifest intellectual theft and outright plagiarism.” If the Justice’s citations were imprecise, it would
just be a case of bad footnoting rather than one of theft or deceit. If it were otherwise, many would be
target of abuse for every editorial error, for every mistake in citing pagination, and for every technical
detail of form.
MASAOY,QMM
As regards the passages from Ellis, the Court notes that the lengthy passages in Footnote
65 of Vinuya came almost verbatim from Ellis’ article but did not contain an acknowledgment or
introduction that they are from that article. Moreover, as regards the passages from the work of
Professors Criddle and Descent, it was also observed that the Vinuya decision lifted the portions, including
their footnotes, from Criddle-Descent’s article, A Fiduciary Theory of Jus Cogens as footnotes in the Vinuya
decision without any attributions made to the two authors. Unless amply explained, these unattributed
lifting from the works of Ellis and Criddle-Descent could be construed as plagiarism.
The explanation came from one of Justice Del Castillo’s researchers, a court-employed
attorney. She explained how she accidentally deleted the attributions, originally planted in the beginning
drafts of her report to him, which report eventually became the working draft of the decision. She said
that, for most parts, she did her research electronically. For international materials, she sourced these
mainly from Westlaw, an online research service for legal and law-related materials to which the Court
subscribes. The researcher showed the Committee the early drafts of her report in the Vinuya case and
these included the passages lifted from the separate articles of Criddle-Descent and of Ellis with proper
attributions to these authors. But, as it happened, in the course of editing and cleaning up her draft, the
researcher accidentally deleted the attributions.
It was notable that neither Justice Del Castillo nor his researcher had a motive or reason for
omitting attribution for the lifted passages to Criddle-Descent or to Ellis. The latter authors are highly
respected professors of international law. The law journals that published their works have exceptional
reputations. It did not make sense to intentionally omit attribution to these authors when the decision
cites an abundance of other sources. Citing these authors as the sources of the lifted passages would
enhance rather than diminish their informative value. Both Justice Del Castillo and his researcher gain
nothing from the omission. Thus, the failure to mention the works of Criddle-Decent and Ellis was
unquestionably due to inadvertence or pure oversight.
Ellis to make it appear that such works supported the Court’s position in the Vinuya decision.
The decision [in Vinuya] did NOT twist the passages from Tams, Criddle-Descent, and Ellis. To
twist means “to distort or pervert the meaning of.” For example, if one lifts the lyrics of the National
Anthem, uses it in his work, and declares that Jose Palma who wrote it “did not love his country,” then
there is “twisting” or misrepresentation of what the anthem’s lyrics said. Here, nothing in
the Vinuya decision said or implied that, based on the lifted passages, authors Tams, Criddle-Descent, and
Ellis supported the Court’s conclusion that the Philippines is not under any obligation in international law
to espouse Vinuya et al.’s claims.
In Re Del Castillo Plagiarism Controversy (Part II) : The February 8, 2011 Per Curiam Resolution (With
Separate Concurrences)
In its Per Curiam Resolution promulgated last February 8, 2011 in A.M. No. 10-7-17-SC, the
Supreme Court en banc DENIED the petitioners’ motion for reconsideration for lack of merit.
The Court first reiterated the definition of plagiarism that it used in the October 12, 2010
decision, thus:
IP CASE DIGESTS III-C Page 10 of 19

Plagiarism, a term not defined by statute, has a popular or common definition. To plagiarize,
says Webster, is “to steal and pass off as one’s own” the ideas or words of another. Stealing implies
malicious taking. Black’s Law Dictionary, the world’s leading English law dictionary quoted by the Court in
its decision, defines plagiarism as the “deliberate and knowing presentation of another person's original
ideas or creative expressions as one’s own.” The presentation of another person’s ideas as one’s own must
be deliberate or premeditated—a taking with ill intent.
[To read a digest of the per curiam resolution, please click here. To read a digest of the
dissenting opinion of Justice Sereno, please click here. –Atty. Ed.]
Then, in response to the reaction from Justice Sereno’s comment that the
majority decision “has created unimaginable problems for Philippine academia,” the Court explained that
it is not actually setting aside the norms adopted by academic institutions in treating plagiarism, thus:
evidence as found by its Ethics Committee shows thatthe attribution to these authors appeared in the
beginning drafts of the decision. Unfortunately, as testified to by a highly qualified and experienced court-
employed researcher, she accidentally deleted the same at the time she was cleaning up the final
draft. The Court believed her since, among other reasons, she had no motive for omitting the
attribution. The foreign authors concerned, like the dozens of other sources she cited in her research, had
high reputations in international law.
Notably, those foreign authors expressly attributed the controversial passages found in their
works to earlier writings by others. The authors concerned were not themselves the originators. As it
happened, although the ponencia of Justice Del Castillo accidentally deleted the attribution to them, there
remained in the final draft of the decision attributions of the same passages to the earlier writings from
which those authors borrowed their ideas in the first place. In short, with the remaining attributions after
the erroneous clean-up, the passages as it finally appeared in the Vinuya decision still showed on their
face that the lifted ideas did not belong to Justice Del Castillo but to others. He did not pass them off as
his own.

[T]he Court’s decision in the present case does not set aside [the different norms assumed by
educational institutions in treating plagiarism]. The decision makes this clear, thus:
To paraphrase Bast and Samuels, while the academic publishing model is based on the
originality of the writer’s thesis, the judicial system is based on the doctrine of stare decisis, which
encourages courts to cite historical legal data, precedents, and related studies in their decisions. The
judge is not expected to produce original scholarship in every respect. The strength of a decision lies in
the soundness and general acceptance of the precedents and long held legal opinions it draws from.

For the majority, it is in the substance of the decisions of magistrates – like Justice del Castillo –
that their genius, originality, and honest labor can be found. Thus, as regards the Vinuya decision, the
Court explained why it is an original and honest work of Justice del Castillo:

In Vinuya, Justice Del Castillo examined and summarized the facts as seen by the opposing sides
in a way that no one has ever done. He identified and formulated the core of the issues that the parties
raised. And when he had done this, he discussed the state of the law relevant to their resolution. It was
here that he drew materials from various sources, including the three foreign authors cited in the charges
against him. He compared the divergent views these present as they developed in history. He then
explained why the Court must reject some views in light of the peculiar facts of the case and applied those
that suit such facts. Finally, he drew from his discussions of the facts and the law the right solution to the
dispute in the case. On the whole, his work was original. He had but done an honest work.

The Court explained why it entertained the charges of plagiarism against Justice Del Castillo,
and why it found that the non-attribution did NOT amount to plagiarism:

The Court probably should not have entertained at all the charges of plagiarism against Justice
Del Castillo, coming from the losing party. But it is a case of first impression and petitioners, joined by
some faculty members of the University of the Philippines school of law, have unfairly maligned him with
the charges of plagiarism, twisting of cited materials, and gross neglect for failing to attribute lifted
passages from three foreign authors. These charges as already stated are false, applying the meaning of
plagiarism as the world in general knows it.
True, Justice Del Castillo failed to attribute to the foreign authors materials that he lifted from
their works and used in writing the decision for the Court in the Vinuya case. But, as the Court said, the

MASAOY,QMM IP CASE DIGESTS III-C Page 11 of 19

Pacita Habana vs Felicidad Robles
310 SCRA 522 (369 Phil. 764) – Mercantile Law – Intellectual Property – Law on Copyright – Infringement
Pacita Habana and two others were the authors of College English for Today Series 1 and 2 (CET). While
they were researching for books to assist them in updating their own book, they chanced upon the book
of Felicidad Robles entitled Developing English Proficiency Books 1 and 2 (DEP). They discovered further
that the book of Robles was strikingly similar to the contents, scheme of presentation, illustrations and
illustrative examples of CET. They then sued Robles and her publisher (Goodwill Trading Co.) for
infringement and/or unfair competition with damages.
Robles, in her defense, alleged that her sources were from foreign books; that in their field, similarity in
styles cannot be avoided since they come from the same background and orientation. The trial court as
well as the Court of Appeals ruled in favor of Robles.
ISSUE: Whether or not the Court of Appeals is correct.
HELD: No. A perusal of the records yields several pages of the book DEP that are similar if not identical
with the text of CET. In several other pages the treatment and manner of presentation of the topics of DEP
are similar if not a rehash of that contained in CET. The similarities in examples and material contents are
so obviously present in this case. How can similar/identical examples not be considered as a mark of
copying? Robles’ act of lifting from the book of Habana et al substantial portions of discussions and
examples, and her failure to acknowledge the same in her book is an infringement of Habana et al’s
copyrights.
The Supreme Court also elucidated that in determining the question of infringement, the amount of matter
copied from the copyrighted work is an important consideration. To constitute infringement, it is not
necessary that the whole or even a large portion of the work shall have been copied. If so much is taken
that the value of the original is sensibly diminished, or the labors of the original author are substantially
and to an injurious extent appropriated by another, that is sufficient in point of law to constitute piracy.
PACITA I. HABANA, ALICIA L. CINCO and JOVITA N. FERNANDO vs. FELICIDAD C. ROBLES and GOODWILL
TRADING CO., INC.
G.R. No. 131522, July 19, 1999
FACTS: Pacita Habana et al., are authors and copyright owners of duly issued of the book, College English
For Today (CET). Respondent Felicidad Robles was the author of the book Developing English Proficiency
(DEP). Petitioners found that several pages of the respondent's book are similar, if not all together a copy
of petitioners' book. Habana et al. filed an action for damages and injunction, alleging respondent’s
infringement of copyrights, in violation of P.D. 49. They allege respondent Felicidad C. Robles being
substantially familiar with the contents of petitioners' works, and without securing their permission, lifted,
copied, plagiarized and/or transposed certain portions of their book CET.
On the other hand, Robles contends that the book DEP is the product of her own intellectual creation, and
was not a copy of any existing valid copyrighted book and that the similarities may be due to the authors'
exercise of the "right to fair use of copyrighted materials, as guides."
MASAOY,QMM
The trial court ruled in favor of the respondents, absolving them of any liability. Later, the Court of Appeals
rendered judgment in favor of respondents Robles and Goodwill Trading Co., Inc. In this appeal, petitioners
submit that the appellate court erred in affirming the trial court's decision.
ISSUE: Whether Robles committed infringement in the production of DEP.
HELD: A perusal of the records yields several pages of the book DEP that are similar if not identical with
the text of CET. The court finds that respondent Robles' act of lifting from the book of petitioners
substantial portions of discussions and examples, and her failure to acknowledge the same in her book is
an infringement of petitioners' copyrights.
In the case at bar, the least that respondent Robles could have done was to acknowledge petitioners
Habana et. al. as the source of the portions of DEP. The final product of an author's toil is her book. To
allow another to copy the book without appropriate acknowledgment is injury enough.
Habana v. Robles (July 19, 1999 GR 131522).
Petitioners are authors and copyright holders of books on the English language (College English for
Today—Book 1 and 2, and Workbook for College Freshman English). They were revising their books and
were scouting for other books of similar subject matter when they chanced upon the books of
Respondents published by Goodwill Trading Co. Inc. (Developing English Proficiency—Books 1 and 2).
Upon further perusal they discovered that the content of said books was very much similar to theirs, and
in fact several pages were even identical. Some illustrative examples were exactly the same. However,
while herein Petitioners researched on said examples by foreign authors and made due acknowledgement,
Respondents made use of the same and never cited the authors. They did not even cite the Petitioners as
the first to use said example.
Petitioners tried to settle the matter extra-judicially by asking Respondents to cease and desist from selling
and distributing the books and by claiming for damages due to lost profit. But said demands were ignored.
So they filed action for Infringement and or/ Unfair Competition with damages before the RTC against
Respondents and Goodwill.
The trial court ruled in favor of Respondents and dismissed the claim against Goodwill. It subscribed to the
arguments of Respondents that there was no plagiarism resulting to Infringement because the examples
were by foreign authors and for educational purposes subject to fair use. It also agreed with Respondents
that the similarities were brought about by the fact that the books dealt with the same subject matter and
adhered to the same presentation format prescribed by the Philippine Colleges of Arts and Sciences
(APCAS). Goodwill was also said to be absolved because it was not privy to the plagiarism and in their
contract with Respondents, there was a guaranty that the work was original and the publisher will not be
liable in case Infringement claims. The trial court also subscribed to the notion of Respondents that
Petitioner was motivated by bad faith in filing the case due to professional jealousy. This is because the
assailed books replaced Petitioner’s as official textbook of the FEU Graduate Studies Department.
IP CASE DIGESTS III-C Page 12 of 19
Petitioners appealed before the CA. But just the same, the appellate court ruled in favor of Respondents
opining that the topics said to be plagiarized were also topics or matters also found in earlier books on
college English, even including foreign books. But it ruled that Petitioners were not in bad faith in filing the
claim. Hence Petitioners filed for Review on Certiorari (Rule 45) before the SC.

The issues in this case are twofold:

1. Is there copyright infringement given that the books dealt with the same subject and subscribed
to the same presentation format, and only some parts were similar and identical?
2. Is the defense of fair use tenable?

The Court rules:

1. Yes, there is plagiarism resulting to copyright infringement in this case. Under RA 8293
copyright holders have copy or economic rights including the exclusive right to carry out,
authorize or prevent reproduction of the whole work or even just a substantial portion of it.
One limitation to this right is that quotations of a copyrighted work may be included in other
publication when compatible with the Fair Use Doctrine (i. e. by way of illustration for teaching
purposes) as long as the author is cited as source. In this case, even if the books dealt with the
same subject and subscribed to the same format, and even if only some parts were similar and
identical, there is still infringement. It need not be a reproduction of the entire work, or even a
large portion of it. If so much is taken that the value of the original work is substantially
diminished or the labors of the original author are substantially and to an injurious extent
appropriated, there is infringement. In this case, not only the discussions were lifted, but also
the examples. And this was done without due acknowledgement to Petitioners.
2. Fair Use cannot be a defense in this case. True, both Petitioners and Respondents used works
by foreign authors as illustrative examples for educational purposes. But Petitioners cited or
acknowledged the authors, Respondents did not. Petitioners labored to do research to find the
best examples and gave citations for it. Respondents copied the same and did not at least
acknowledge Petitioners or even the foreign authors of said examples. There must be citations.

There you go. And also if you are accused of copyright infringement and plagiarism and you think you have
a good defense, do not withdraw the subject publications from the bookstores. The act could be used
against you as ‘indica’ of guilt as the High Court ruled in this case

MASAOY,QMM IP CASE DIGESTS III-C Page 13 of 19

Columbia Pictures Entertainment, Inc. vs Court of Appeals
262 SCRA 219 – Mercantile Law – Intellectual Property – Law on Copyright – Requirements Before a Search
Warrant May Be Issued in Copyright Cases – Piracy
Political Law – Constitutional Law – Bill of Rights – Search Warrants
In 1986, the Videogram Regulatory Board (VRB) applied for a warrant against Jose Jinco (Jingco), owner of
Showtime Enterprises for allegedly pirating movies produced and owned by Columbia Pictures and other
motion picture companies. Jingco filed a motion to quash the search warrant but the same was denied in
1987. Subsequently, Jinco filed an Urgent Motion to Lift the Search Warrant and Return the Articles Seized.
In 1989, the RTC judge granted the motion. The judge ruled that based on the ruling in the 1988 case
of 20th Century Fox Film Corporation vs CA, before a search warrant could be issued in copyright cases, the
master copy of the films alleged to be pirated must be attached in the application for warrant.
ISSUE: Whether or not the 20th Century Fox ruling may be applied retroactively in this case.
HELD: No. In 1986, obviously the 1988 case of 20th Century Fox was not yet promulgated. The lower court
could not possibly have expected more evidence from the VRB and Columbia Pictures in their application
for a search warrant other than what the law and jurisprudence, then existing and judicially accepted,
required with respect to the finding of probable cause.
The Supreme Court also revisited and clarified the ruling in the 20th Century Fox Case. It is evidently
incorrect to suggest, as the ruling in 20th Century Fox may appear to do, that in copyright infringement
cases, the presentation of master tapes of the copyright films is always necessary to meet the requirement
of probable cause for the issuance of a search warrant. It is true that such master tapes are object
evidence, with the merit that in this class of evidence the ascertainment of the controverted fact is made
through demonstration involving the direct use of the senses of the presiding magistrate. Such auxiliary
procedure, however, does not rule out the use of testimonial or documentary evidence, depositions,
admissions or other classes of evidence tending to prove the factum probandum, especially where the
production in court of object evidence would result in delay, inconvenience or expenses out of proportion
to is evidentiary value.
In fine, the supposed pronouncement in said case regarding the necessity for the presentation of the
master tapes of the copy-righted films for the validity of search warrants should at most be understood to
merely serve as a guidepost in determining the existence of probable cause in copy-right infringement
cases where there is doubt as to the true nexus between the master tape and the pirated copies. An
objective and careful reading of the decision in said case could lead to no other conclusion than that said
directive was hardly intended to be a sweeping and inflexible requirement in all or similar copyright
infringement cases.
Columbia Pictures v. Flores, G.R. No. 78631, June 29, 1993
DECISION
(3rd Division)
MASAOY,QMM
MELO, J.:
I. THE FACTS
As a consequence of a complaint filed by the Motion Picture Association of America, Inc., NBI
agents conducted surveillance operations on certain video establishments, among them respondent FGT
Video Network, Inc. (FGT), for “unauthorized sale, rental, reproduction and/or disposition of copyrighted
film," a violation of PD 49 (the old Intellectual Property Law). After an NBI agent was able to
have copyrighted motion pictures “Cleopatra” (owned by 20th Century Fox) and “The Ten
Commandments” (owned by Paramount) reproduced in video format in FGT, the NBI applied for and was
able to obtain from the respondent judge the subject Search Warrant No. 45 which reads:
TO ANY PEACE OFFICER:
GREETINGS:
It appearing to the satisfaction of the Undersigned after examining under oath NBI Senior Agent Lauro C.
Reyes and his witnesses Mr. Danilo Manalang and Ms. Rebecca Benitez-Cruz, that there is a probable cause
to believe that Violation of Section 56 P.D. No. 49 as amended by P.D. No. 1988 (otherwise known as the
Decree on Protection of Intellectual Property) has been committed and that there are good and sufficient
reasons to believe that FGT Video Network, Inc., Manuel Mendoza, Alfredo C. Ongyanco, Eric Apolonio,
Susan Yang and Eduardo Yotoko are responsible and have in control/possession at No. 4 Epifanio de los
Santos corner Connecticut, Greenhills, San Juan, Metro Manila (per attached sketch and list of MPAA
member Company Titles) the following properties to wit:
(a) Pirated video tapes of the copyrighted motion pictures/films the titles of which are mentioned in the
attached list;
(b) Posters, advertising leaflets, flyers, brochures, invoices, lists of titles being reproduced or retaped, journals,
ledgers, jon (sic) order slips, delivery slips and books of accounts bearing and/or mentioning the pirated
films with titles (as per attached list), or otherwise used in the reproduction/retaping business of the
defendants;
(c) Television sets, video cassette recorders, rewinders, tape head cleaners, accessories, equipment and other
machines and paraphernalia or materials used or intended to be used in the unlawful sale, lease,
distribution, or possession for purpose of sale, lease, distribution, circulation or public exhibition of the
above-mentioned pirated video tapes which they are keeping and concealing in the premises above-
described, which should be seized and brought to the Undersigned.
IP CASE DIGESTS III-C Page 14 of 19
You are hereby commanded to make an immediate search at any time in the day between 8:00 A.M. to
5:00 P.M. of the premises above-described and forthwith seize and take possession of the above-
enumerated personal properties, and bring said properties to the undersigned immediately upon
implementation to be dealt with as the law directs.
In the course of the implementation of the search warrant in the premises of FGT, the NBI
agents found and seized various video tapes of copyrighted films owned and exclusively distributed by
petitioners. Also seized were machines and equipment, television sets, paraphernalia, materials,
accessories, rewinders, tape head cleaners, statements of order, return slips, video prints, flyers,
production orders, and posters.
FGT moved for the release of the seized television sets, video cassette recorders, rewinders,
tape head cleaners, accessories, equipment and other machines or paraphernalia seized by virtue of the
subject warrant. It argued that as a licensed video reproducer, it had the right possess the seized
reproduction equipment, which are not illegal per se, but are rather exclusively used and intended to be
used for reproduction and not in the “sale, lease, distribution or possession for purposes of sale, lease
distribution, circulation or public exhibition of pirated video tapes.”
Finding that FGT was a registered and duly licensed distributor and in certain instances and
under special instructions and conditions reproducer of videograms and that, therefore, its right to possess
and use the seized equipment had been placed in serious doubt, the lower court ordered the return of the
“television sets, video cassette recorders, rewinders, tape head cleaners, accessories, equipment and
other machines or paraphernalia” to FGT.
II. THE ISSUE
Did the respondent judge act with grave abuse of discretion amounting to lack of jurisdiction
in ordering the immediate return of some of the items seized by virtue of the search warrant?
III. THE RULING
[The High Tribunal DISMISSED the petition and AFFIRMED the order of the respondent Judge
Flores.]
MASAOY,QMM
NO, the respondent judge DID NOT act with grave abuse of discretion amounting to lack of
jurisdiction in ordering the immediate return of some of the items seized by virtue of the search warrant.
Search Warrant No. 45 fails to satisfy the test of legality. This is more so because the Court has
previously decided a case dealing with virtually the same kind of search warrant. In 20th Century Fox vs.
CA, the Court upheld the legality of the order of the lower court lifting the search warrant issued under
circumstances similar to those obtaining in the case at bar. A striking similarity between this case
and 20th Century Fox is the fact that Search Warrant No. 45, specifically paragraph (c) thereof describing
the articles to be seized, contains an almost identical description as the warrant issued in the 20th Century
Fox case, to wit:
(c) Television sets, Video Cassettes Recorders, rewinders, tape head cleaners, accessories,
equipments and other machines used or intended to be used in the unlawful reproduction, sale,
rental/lease, distribution of the above-mentioned video tapes which she is keeping and concealing in the
premises above-described.
On the propriety of the seizure of the articles above-described, the Court held in20th Century
Fox:
Television sets, video cassette recorders, rewinders and tape cleaners are articles which can be
found in a video tape store engaged in the legitimate business of lending or renting out betamax tapes. In
short, these articles and appliances are generally connected with, or related to a legitimate business not
necessarily involving piracy of intellectual property or infringement of copyright laws. Hence, including
these articles without specification and/or particularity that they were really instruments in violating an
Anti-Piracy law makes the search warrant too generalwhich could result in the confiscation of all items
found in any video store.
The language used in paragraph (c) of Search Warrant No. 45 is thus too all-embracing as to
include all the paraphernalia of FGT in the operation of its business. As the search warrant is in the nature
of a general one, it is constitutionally objectionable.
The Court concluded that the respondent judge did not gravely abuse his discretion in ordering
the immediate release of the enumerated items, but that he was merely correcting his own erroneous
conclusions in issuing Search Warrant No. 45. This can be gleaned from his statement that “. . . the
machines and equipment could have been used or intended to be used in the illegal reproduction of tapes
of the copyrighted motion pictures/films, yet, it cannot be said with moral certainty that the machines or
equipment(s) were used in violating the law by the mere fact that pirated video tapes of the copyrighted
motion pictures/films were reproduced. As already stated, FGT Video Network, Inc. is a registered and
duly licensed distributor and in certain instances and under special instructions . . . reproducer of
IP CASE DIGESTS III-C Page 15 of 19
videograms, and as such, it has the right to keep in its possession, maintain and operate reproduction been recorded but the "sale, lease, or distribution of pirated video tapes of
equipment(s) and paraphernalia(s).” copyrighted films."

In applying for the search warrants the NBI charged violation of the entire provisions
of Section 56 of P.D. No. 49 as amended by P.D.No. 1988. This included not only the
COLUMBIA PICTURES INC. v CA [237 SCRA 367 (1994)]
sale, lease or distribution of pirated tapes but also the transfer or causing to be
Nature: Petitions for review on certiorari of the decision of the CA.
transferred of any sound recording or motion picture or other audio visual work.
Ponente: J. Vitug
Facts:
But even assuming, as appellants argue, that only the sale, lease, or distribution of
 07 April 1998: NBI filed with the RTC of Pasig 3 applications for SW against private respondent
pirated video tapes is involved, the fact remains that there is need to establish
(Tube Video Enterprises – Edward C. Cham; Blooming Rose Tape Center – Ma. Jajorie T. Uy;
probable cause that the tapes being sold, leased or distributed are pirated tapes,
Video Channel – Lydia Nabong) charging them with violations of Sec. 56 of PD 49 (Decree on
hence the issue reverts back to the question of whether there was unauthorized
the Protection of Intellectual Property) as amended by PD 1988.
transfer, directly or indirectly, of a sound recording or motion picture or other audio
 RTC Judge Austria consolidated the 3 applications and conducted a joint hearing where she
visual work that has been recorded
made a personal examination of the applicant (NBI Agent Reyes) and his witnesses.
 Finding just and probable cause, Judge Austria issued the search warrants.
Petitions denied.
 Private Respondents filed their “Motion to Quash” the SW citing as grounds that there was no
probable cause; the films in question are not protected by PD 1988 in that they were never
registered in the National Library as a condition precedent to the availment of the protection;
the Motion Picture Association of America have not proven nor established their ownership
over the films; etc.
 Judge Austria reversed her former stand initially finding probable cause for the issuance of the
search warrants and ordered their quashal:
o Private complainants uncertain of their ownership over the titles;
o Complainants did not comply with the requirement that master tapes should be
presented during the application for search warrants;
o Complainants failed to comply with the deposit and registration requirements of PD
49 as amended by PD 1988.
 Judge Austria also ordered the return of the items seized by virtue of the warrants.
 CA affirmed the quashal of the SWs.

Issue: WON the SWs were issued with probable cause. NO

Ratio:
BASIC REQUIREMENT for the validity of search warrants (in cases of this nature) is the presentation of the
master tapes of the copyrighted films from which the pirated films are supposed to have been copied
(20th Century Fox Film Corp. vs. CA, 164 SCRA 655).

The essence of a copyright infringement is the similarity or at least substantial similarity of the purported
pirated works to the copyrighted work. Hence, the applicant must present to the court the copyrighted
films to compare them with the purchased evidence of the video tapes allegedly pirated to determine
whether the latter is an unauthorized reproduction of the former. This linkage of the copyrighted films to
the pirated films must be established to satisfy the requirements of probable cause. Mere allegations as
to the existence of the copyrighted films cannot serve as basis for the issuance of a search warrant.

According to the CA, in which the SC concurs:

It is not correct to say that "the basic fact" to be proven to establish probable cause
in the instant cases is not the "unauthorized transfer" of a motion picture that has

MASAOY,QMM IP CASE DIGESTS III-C Page 16 of 19

NBI, Microsoft Corporation vs Judy Hwang
460 SCRA 428 – Mercantile Law – Intellectual Property – Law on Copyright – Copyright Infringement
In May 1993, Microsoft Corporation and Beltron Computer Philippines, Inc. entered into a Licensing
Agreement. Under Section 2(a) of the Agreement, Microsoft authorized Beltron, for a fee, to:
1. Reproduce and install no more than one copy of Windows on each Customer System hard disk;
2. Distribute directly or indirectly and license copies of Windows (reproduced as per Section 2 of the
Agreement and/or acquired from an Authorized Replicator or Authorized Distributor.
Their agreement allowed either party to terminate if one fails to comply with their respective obligations.
Microsoft terminated the Agreement in June 1995 by reason of Beltron’s non-payment of royalties. Later,
Microsoft learned that Beltron was illegally copying and selling copies of Windows. Microsoft then sought
the assistance of the National Bureau of Investigation. NBI agents made some purchase from Beltron
where they acquired a computer unit pre-installed with Windows, 12 windows installer CDs packed as
Microsoft products. The agents were not given the end-user license agreements, user manuals, and
certificates of authenticity for the products purchased. They were given a receipt which has a header of
“T.M.T.C. (Phils) Inc. BELTRON COMPUTER”. TMTC stands for Taiwan Machinery Display and Trade Center.
A search warrant was subsequently issued where 2,831 CDs of Windows installers, among others, were
seized. Based on the items seized from Beltron, Microsoft filed a case of copyright infringement against
Beltron and TMTC as well as their officers (Judy Hwang et al) before the Department of Justice (DOJ).
Beltron, in its counter-affidavit, argued the following:
1. That Microsoft’s issue with Beltron was really just to have leverage in forcing Beltron to pay the unpaid
royalties; and that Microsoft should have filed a collection suit.
2. That the computer unit allegedly purchased by the NBI agents from them cannot be decisively traced as
coming from Beltron because the receipt issued to the agents did not list the computer unit as one of the
items bought.
3. That the 12 installers purchased by the agents which are actually listed in the receipt were not
manufactured by Beltron but rather they were genuine copies purchased by TMTC from an authorized
Microsoft seller in Singapore.
4. That the 2,831 installers seized from them were not a property of Beltron but rather they were left to
them by someone for safekeeping.
The DOJ secretary agreed with Beltron and dismissed the case. The Secretary ruled that the issue of the
authority of Beltron to copy and sell Microsoft products should first be resolved in a civil suit. Microsoft
appealed the decision of the DOJ secretary before the Supreme Court. Meanwhile, Beltron filed a motion
to quash the search warrant before the RTC that issued the same. The RTC partially granted the quashal.
The Court of Appeals reversed the RTC. Hwang et al did not appeal the CA decision.
ISSUE: Whether or not the DOJ Secretary is correct.
HELD: No. Section 5 of Presidential Decree 49 enumerates the rights vested exclusively on the copyright
owner. Contrary to the DOJ’s ruling, the gravamen of copyright infringement is not merely the
unauthorized “manufacturing” of intellectual works but rather the unauthorized performance of any of
the acts covered by Section 5. Hence, any person who performs any of the acts under Section 5 without
obtaining the copyright owner’s prior consent renders himself civilly and criminally liable for copyright
infringement.
MASAOY,QMM
Infringement of a copyright is a trespass on a private domain owned and occupied by the owner of the
copyright, and, therefore, protected by law, and infringement of copyright, or piracy, which is a
synonymous term in this connection, consists in the doing by any person, without the consent of the owner
of the copyright, of anything the sole right to do which is conferred by statute on the owner of the
copyright.
Being the copyright and trademark owner of Microsoft software, Microsoft acted well within its rights in
filing the complaint before DOJ on the incriminating evidence obtained from Beltron. Hence, it was highly
irregular for the DOJ to hold that Microsoft sought the issuance of the search warrants and the filing of
the complaint merely to pressure Beltron to pay its overdue royalties to Microsoft.
There is no basis for the DOJ to rule that Microsoft must await a prior “resolution from the proper court
of whether or not the Agreement is still binding between the parties.” Beltron has not filed any suit to
question Microsoft’s termination of the Agreement. Microsoft can neither be expected nor compelled to
wait until Beltron decides to sue before Microsoft can seek remedies for violation of its intellectual
property rights.
Furthermore, the articles seized from Beltron are counterfeit per se because Microsoft does not (and could
not have authorized anyone to) produce such CD installers The copying of the genuine Microsoft software
to produce these fake CDs and their distribution are illegal even if the copier or distributor is a Microsoft
licensee. As far as these installer CD-ROMs are concerned, the Agreement (and the alleged question on
the validity of its termination) is immaterial to the determination of Beltron’s liability for copyright
infringement and unfair competition. Beltron’s defense that the box of CD installers found in their
possession was only left to them for safekeeping is not tenable.
NBI MICROSOFT CORPORATION & LOTUS DEVELOPMENT CORP., petitioners, vs. JUDY C. HWANG, BENITO
KEH & YVONNE K. CHUA/BELTRON COMPUTER PHILIPPINES INC., JONATHAN K. CHUA, EMILY K. CHUA,
BENITO T. SANCHEZ, NANCY I. VELASCO, ALFONSO CHUA, ALBERTO CHUA, SOPHIA ONG, DEANNA
CHUA/TAIWAN MACHINERY DISPLAY & TRADE CENTER, INC., and THE SECRETARY OF JUSTICE,
respondents.
Parties:
 Petitioner Microsoft Corporation (“Microsoft”), a Delaware, United States Corporation, owns the
copyright and trademark to several computer software.
Subject of Copyright: Microsoft Software
 Respondents Benito Keh and Yvonne Keh are the President/Managing Director and General
Manager, respectively, of respondent Beltron Computer Philippines, Inc. (“Beltron”), a domestic
corporation. Respondents Jonathan K. Chua, Emily K. Chua, Benito T. Sanchez, and Nancy I. Velasco
are Beltron’s Directors. On the other hand, respondents Alfonso Chua, Alberto Chua, Judy K. Chua
Hwang, Sophia Ong, and Deanna Chua are the Directors of respondent Taiwan Machinery Display &
Trade Center, Inc. (“TMTC”), also a domestic corporation.
Facts:
 In May 1993, Microsoft and Beltron entered into a Licensing Agreement (“Agreement”). Under
Section 2(a) of the Agreement, as amended in January 1994, Microsoft authorized Beltron, for a fee,
to:
IP CASE DIGESTS III-C Page 17 of 19
 1. reproduce and install no more than one (1) copy of [Microsoft] software on each
Customer System hard disk or Read Only Memory (“ROM”);
2. distribute directly or indirectly and license copies of the Product (reproduced as per
Section 2(a)(i) and/or acquired from Authorized Replicator or Authorized
Distributor) in object code form to end users[.]
 The Agreement also authorized Microsoft and Beltron to terminate the contract if the other fails to
comply with any of the Agreement’s provisions.Microsoft terminated the Agreement effective 22
June 1995 for Beltron’s non-payment of royalties.
 Afterwards, Microsoft learned that respondents were illegally copying and selling Microsoft
software. Consequently, Microsoft, through its Philippine agent, hired the services of Pinkerton
Consulting Services (“PCS”), a private investigative firm. Microsoft also sought the assistance of the
National Bureau of Investigation (“NBI”). On 10 November 1995, PCS employee John Benedic Sacriz
(“Sacriz”) and NBI agent DominadorSamiano, Jr. (“Samiano”), posing as representatives of a
computer shop, bought computer hardware (central processing unit (“CPU”) and computer
monitor) and software (12 computer disks (“CDs”) in read-onlymemory (“ROM”) format) from
respondents. The CPU contained preinstalled Microsoft Windows 3.1 and MSDOS software. The 12
CDROMs, encased in plastic containers with Microsoft packaging, also contained Microsoft
software. Sacriz and Samiano were not given the Microsoft enduser license agreements, user’s
manuals, registration cards or certificates of authenticity for the articles they purchased. The receipt
issued to Sacriz and Samiano for the CPU and monitor bore the heading “T.M.T.C. (PHILS.) INC.
BELTRON COMPUTER.” The receipt for the 12 CDROMs did not indicate its source although the
name “Gerlie” appears below the entry “delivered by.
 Microsoft applied for search warrants against respondents in the Regional Trial Court,.The RTC
granted Microsoft’s application and issued two search warrants. Using Search Warrants, the NBI
searched the premises of Beltron and TMTC and seized several computer related hardware,
software, accessories, and paraphernalia. Among these were 2,831 pieces of CDROMs containing
Microsoft software.
 Microsoft and a certain Lotus Development Corporation charged respondents before the
Department of Justice with copyright infringement under Section 5(A) in relation to Section 29 of
Presidential Decree No. 49, as amended, (“PD 49”) and with unfair competition under Article 189(1)
of the Revised Penal Code. In its Complaint which the NBI indorsed, Microsoft alleged that
respondents illegally copied and sold Microsoft software.
 Respondents Yvonne Keh and Emily K. Chua denied the charges against respondents. They alleged
that:
1. Microsoft’s real intention in filing the complaint was to pressure Beltron to pay its
alleged unpaid royalties, thus Microsoft should have filed a collection suit instead of a
criminal complaint;
2. TMTC bought the confiscated 59 boxes of MSDOS CDs from a Microsoft dealer in
Singapore (R.R. Donnelly);
3. Respondents are not the “source” of the Microsoft Windows 3.1 software preinstalled
in the CPU bought by Sacriz and Samiano, but only of the MSDOS software;
4. Microsoft’s alleged proof of purchase (receipt) for the 12 CDROMs is inconclusive
because the receipt does not indicate its source; and
5. Respondents Benito Keh, Jonathan K. Chua, Alfonso Chua, Alberto Chua, Judy K. Chua
Hwang, Sophia Ong, and Deanna Chua are stockholders of Beltron and TMTC in name
only and thus cannot be held criminally liable.
 Meanwhile, respondents moved to quash Search Warrants. The RTC partially granted their motion.
MASAOY,QMM
 Microsoft sought reconsideration but the RTC denied Microsoft’s motion in its Order of 19 July 1996.
RTC held that the search warrants applied for by complainant were merely used as a leverage for
the collection of the alleged monetary obligation of the respondent/s. From said order, it can be
surmise that the obligations between the parties is civil in nature not criminal. As to the second
issue, the court find for the respondent/s. TMTC had provided sufficient evidence such as pro forma
invoice from R.R. Donnelley; Debt Advice of the Bank of Commerce; Official Receipts from the
Bureau of Customs; and Import Entry Declaration of the Bureau of Customs to prove that indeed
the Microsoft software in their possession were bought from Singapore. Thus, respondent/s in this
case has/have no intent to defraud the public, as provided under Article 189 of the Revised Penal
Code, for they bought said Microsoft MSDOS 6.0 from an alleged licensee of Microsoft in Singapore,
with all the necessary papers. In their opinion, what they have are genuine Microsoft software,
therefore no unfair competition exist. Moreover, violation of P.D. 49 does not exist, for
respondent/s was/were not the manufacturers of the Microsoft software seized.
 Microsoft appealed to the Court of Appeals. The Court of Appeals granted Microsoft’s appeal and
set aside the RTC Orders of 16 April 1996 and 19 July 1996. The Court of Appeals’ Decision became
final on 27 December 2001. Complainant had alleged that from the time the license agreement was
terminated, respondent/s is/are no longer authorized to copy/distribute/sell Microsoft products.
Microsoft sought reconsideration and prayed for an ocular inspection of the articles seized from
respondents. .
 In the Resolution of 26 October 1999 State Prosecutor Ong also recommended the dismissal of Lotus
Corporation’s complaint for lack of interest to prosecute and for insufficiency of evidence which
later on approved by the Assistant Chief Prosecutor.
 Microsoft sought reconsideration and prayed for an ocular inspection of the articles seized from
respondents. Assistant Chief State Prosecutor Buenafe, denied Microsoft’s motion. Microsoft
appealed to the Office of the DOJ Secretary. DOJ Undersecretary Regis V. Puno dismissed
Microsoft’s appeal. Microsoft sought reconsideration but its motion was denied in theResolution
of 22 December 2000. Hence, this petition.
ISSUE:
Whether or not respondents is guilty of copyright infringement and unfair competition.
HELD:
YES.
1. PD 49 and Article 189(1)
 Section 539 of PD 49 (“Section 5”) enumerates the rights vested exclusively on the copyright
owner. Contrary to the DOJ’s ruling, the gravamen of copyright infringement is not merely the
unauthorized “manufacturing” of intellectual works but rather the unauthorized performance
of any of the acts covered by Section 5. Hence, any person who performs any of the acts under
Section 5 without obtaining the copyright owner’s prior consent renders himself civilly and
criminally liable for copyright infringement.
 Significantly, under Section 5(A), a copyright owner is vested with the exclusive right to “copy,
distribute, multiply, [and] sell” his intellectual works.
 On the other hand, the elements of unfair competition under Article 189(1) of the Revised Penal
Code are:
1. That the offender gives his goods the general appearance of the goods of
another manufacturer or dealer;
IP CASE DIGESTS III-C Page 18 of 19
 2. That the general appearance is shown in the (1) goods themselves, or in the from respondents. Together, these considerations point to respondents as the vendor of the
(2) wrapping of their packages, or in the (3) device or words therein, or in (4) counterfeit CDROMs.
any other feature of their appearance;  Being a mere reproducer/installer of one Microsoft software copy on each customer’s hard disk
3. That the offender offers to sell or sells those goods or gives other persons a or ROM, Beltron could only have acquired the hundreds of Microsoft CDROMs found in
chance or opportunity to do the same with a like purpose[; and] respondents’ possession from Microsoft distributors or replicators.However, respondents
4. That there is actual intent to deceive the public or defraud a competitor. The makes no such claim. What respondents contend is that these CDROMs were left to them for
element of intent to deceive may be inferred from the similarity of the goods safekeeping. But neither is this claim tenable for lack of substantiation. These circumstances
or their appearance. give rise to the reasonable inference that respondents mass produced the CDROMs in question
without securing Microsoft’s prior authorization.
2. Being the copyright and trademark owner of Microsoft software, Microsoft acted well within its
rights in filing the complaint based on the incriminating evidence obtained from respondents.
Hence, it was highly irregular for the DOJ to hold, based on the RTC Order of 19 July 1996, that
Microsoft sought the issuance of Search Warrants and by inference, the filing of the complaint
merely to pressure Beltron to pay its overdue royalties to Microsoft.
3. There is no basis for the DOJ to rule that Microsoft must await a prior “resolution from the proper
court of (sic) whether or not the [Agreement] is still binding between the parties.” Beltron has not
filed any suit to question Microsoft’s termination of the Agreement. Microsoft can neither be
expected nor compelled to wait until Beltron decides to sue before Microsoft can seek remedies for
violation of its intellectual property rights.
 Furthermore, some of the counterfeit CDROMs bought from respondents were “installer”
CDROMs containing Microsoft software only or both Microsoft and non Microsoft software..
The copying of the genuine Microsoft software to produce these fake CDROMs and their
distribution are illegal even if the copier or distributor is a Microsoft licensee. As far as these
installer CDROMs are concerned, the Agreement (and the alleged question on the validity of its
termination) is immaterial to the determination of respondents’ liability for copyright
infringement and unfair competition.
 Lastly, Section 10(b)48 of the Agreement provides that Microsoft’s “rights and remedies” under
the contract are “not x x x exclusive and are in addition to any other rights and remedies
provided by law or [the] Agreement.” Thus, even if the Agreement still subsists, Microsoft is
not precluded from seeking remedies under PD 49 and Article 189(1) of the Revised Penal Code
to vindicate its rights.
4. The Court finds that the 12 CDROMs and the CPU with preinstalled Microsoft software Sacriz and
Samiano bought from respondents and the 2,831 Microsoft CDROMs seized from respondents
suffice to support a finding of probable cause to indict respondents for copyright infringement
under Section 5(A) in relation to Section 29 of PD 49 for unauthorized copying and selling of
protected intellectual works
 The illegality of the “noninstaller” CDROMs purchased from respondents and of the Microsoft
software preinstalled in the CPU is shown by the absence of the standard features
accompanying authentic Microsoft products.
 The counterfeit “noninstaller” CDROMs bought from respondents also suffice to support a
finding of probable cause to indict respondents for unfair competition under Article 189(1) of
the Revised Penal Code for passing off Microsoft products. From the pictures of the CDROMs’
packaging, one cannot distinguish them from the packaging of CDROMs containing genuine
Microsoft software. Such replication, coupled with the similarity of content of these fake
CDROMs and the CDROMs with genuine Microsoft software, implies intent to deceive.
 Respondents’ contention that the 12 CDROMs purchased cannot be traced to them because
the receipt for these articles does not indicate its source is unavailing. The receipt in question
should be taken together with Microsoft’s claim that Sacriz and Samiano bought the CDROMs

MASAOY,QMM IP CASE DIGESTS III-C Page 19 of 19