Santos vs McCullough Printing Company

Facts:
This is an action for damages based on the provisions of Articles 721 and 722 of the Civil Code of the
Philippines, allegedly on the unauthorized use, adoption and appropriation by the defendant company
of plaintiff's intellectual creation or artistic design for a Christmas Card. The design depicts "a Philippine
rural Christmas time scene consisting of a woman and a child in a nipa hut adorned with a star-shaped
lantern and a man astride a carabao, beside a tree, underneath which appears the plaintiff's pen name,
Malang."
The complaint alleges that plaintiff Mauro Malang Santos designed for former Ambassador Felino Neri,
for his personal Christmas Card greetings for the year 1959, the artistic motif in question. The following
year the defendant McCullough Printing Company, without the knowledge and authority of plaintiff,
displayed the very design in its album of Christmas cards and offered it for sale, for a price. For such
unauthorized act of defendant, plaintiff suffered moral damages to the tune of P16,000.00, because it
has placed plaintiff's professional integrity and ethics under serious question and caused him grave
embarrassment before Ambassador Neri. He further prayed for the additional sum of P3,000.00 by way
of attorney's fee.

Issue:
Whether Santos is entitled for protection, notwithstanding the fact that he has not copyrighted
his design.

Ruling:
No.
The lower court dismisses the complaint which the Supreme Court affirmed.
Santos did not choose to protect his intellectual creation by a copyright. The fact that the design
was used in the Christmas card of Ambassador Neri who distributed 800 copies thereof among his
friends during the Christmas season of 1959, shows the same was published.
Unless satisfactory explained a delay in applying for a copyright, of more than 30 days from the
date of its publication, converts the property to one of public domain.
Since the name of the author appears in each of the alleged infringing copies of intellectual
creation, the defendant may not be said to have pirated the work nor guilty of plagiarism. Consequently,
the complaint does not state a cause of action against the defendant.
The Supreme Court held that Santos is not entitled to a protection.
Rules of Practice in the Philippine Patent Office relating to the Registration of Copyright Claims.
“An intellectual creation should be copyrighted 30 days after its publication, if made in Manila, or
within 60 days if made elsewhere, failure of which renders such creation public property.”
When the purpose is limited publication, but the effect is general publication, irrevocable rights
thereupon become vested in the public, in consequence of which enforcement of the restriction
becomes impossible.
FILIPINO SOCIETY OF COMPOSERS, AUTHORS AND PUBLISHERS, INC., plaintiff-
appellant, vs. BENJAMIN TAN, defendant-appellee.

Plaintiff-appellant:
*is the owner of certain musical compositions among which are the songs entitled: "Dahil Sa Iyo",
"Sapagkat Ikaw Ay Akin," "Sapagkat Kami Ay Tao Lamang" and "The Nearness Of You."
*filed a complaint with the lower court for infringement of copyright against defendant-appellee for
allowing the playing in defendant-appellee's restaurant of said songs copyrighted in the name of
the former.

Defendant-appellee,
*countered that the complaint states no cause of action. While not denying the playing of said
copyrighted compositions in his establishment, appellee maintains that the mere singing and
playing of songs and popular tunes even if they are copyrighted do not constitute an infringement
under the provisions of Section 3 of the Copyright Law.

ISSUE: whether or not the playing and signing of musical compositions which have been
copyrighted under the provisions of the Copyright Law (Act 3134) inside the establishment of the
defendant-appellee constitute a public performance for profit within the meaning and
contemplation of the Copyright Law of the Philippines; and assuming that there were indeed public
performances for profit, whether or not appellee can be held liable therefor.

Held: NO. It has been held that "The playing of music in dine and dance establishment which was
paid for by the public in purchases of food and drink constituted "performance for profit" within a
Copyright Law." Thus, it has been explained that while it is possible in such establishments for
the patrons to purchase their food and drinks and at the same time dance to the music of the
orchestra, the music is furnished and used by the orchestra for the purpose of inducing the public
to patronize the establishment and pay for the entertainment in the purchase of food and drinks.
The defendant conducts his place of business for profit, and it is public; and the music is
performed for profit.

Nevertheless, appellee cannot be said to have infringed upon the Copyright Law. Appellee's
allegation that the composers of the contested musical compositions waived their right in favor of
the general public when they allowed their intellectual creations to become property of the public
domain before applying for the corresponding copyrights for the same is correct.

The Supreme Court has ruled that "Paragraph 33 of Patent Office Administrative Order No. 3 (as
amended, dated September 18, 1947) entitled 'Rules of Practice in the Philippines Patent Office
relating to the Registration of Copyright Claims' promulgated pursuant to Republic Act 165,
provides among other things that an intellectual creation should be copyrighted thirty (30) days
after its publication, if made in Manila, or within the (60) days if made elsewhere, failure of which
renders such creation public property." Indeed, if the general public has made use of the object
sought to be copyrighted for thirty (30) days prior to the copyright application the law deems the
object to have been donated to the public domain and the same can no longer be
copyrighted.Under the circumstances, it is clear that the musical compositions in question had
long become public property, and are therefore beyond the protection of the Copyright Law.
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.
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?

Ruling:
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.
Also, as provided in the contracts Chan entered into with Bayanihan was the agreement that in
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
publisher shall execute the necessary release in writing in favor of the writer upon the request of the
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.
Anent the copyrights obtained on the basis of the contracts, suffice it to say that such purported
copyrights are not presumed to subsist in accordance with Sec. 218, RA 8293 because Chan had put in
issue the existence thereof.
ELIDAD C. KHO, doing business under the name and style of KEC COSMETICS
LABORATORY, petitioner, vs. HON. COURT OF APPEALS, SUMMERVILLE GENERAL
MERCHANDISING and COMPANY, and ANG TIAM CRAY, respondents.

Petitioner complaint alleges:

*that petitioner, doing business under the name and style of KEC Cosmetics Laboratory, is the
registered owner of the copyrights Chin Chun Su and Oval Facial Cream Container/Case, as
shown by Certificates of Copyright Registration No. 0-1358 and No. 0-3678;
*that she also has patent rights on Chin Chun Su & Device and Chin Chun Su for medicated
cream after purchasing the same from Quintin Cheng, the registered owner thereof in the
Supplemental Register of the Philippine Patent Office on February 7, 1980 under Registration
Certificate No. 4529;
*that respondent Summerville advertised and sold petitioner’s cream products under the brand
name Chin Chun Su, in similar containers that petitioner uses, thereby misleading the public, and
resulting in the decline in the petitioner’s business sales and income; and, that the respondents
should be enjoined from allegedly infringing on the copyrights and patents of the petitioner.

Respondents allege:
*Summerville is the exclusive and authorized importer, re-packer and distributor of Chin Chun Su
products manufactured by Shun Yi Factory of Taiwan;
*that the said Taiwanese manufacturing company authorized Summerville to register its trade
name Chin Chun Su Medicated Cream with the Philippine Patent Office and other appropriate
governmental agencies; that KEC Cosmetics Laboratory of the petitioner obtained the copyrights
through misrepresentation and falsification; and, that the authority of Quintin Cheng, assignee of
the patent registration certificate, to distribute and market Chin Chun Su products in the
Philippines had already been terminated by the said Taiwanese Manufacturing Company.

ISSUE: WON KHO is protected under the law.

Held: NO. Trademark, copyright and patents are different intellectual property rights that cannot
be interchanged with one another. A trademark is any visible sign capable of distinguishing the
goods (trademark) or services (service mark) of an enterprise and shall include a stamped or
marked container of goods. In relation thereto, a trade name means the name or designation
identifying or distinguishing an enterprise. Meanwhile, the scope of a copyright is confined to
literary and artistic works which are original intellectual creations in the literary and artistic domain
protected from the moment of their creation. Patentable inventions, on the other hand, 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.

Petitioner has no right to support her claim for the exclusive use of the subject trade name and its
container. The name and container of a beauty cream product are proper subjects of a trademark
inasmuch as the same falls squarely within its definition. In order to be entitled to exclusively use
the same in the sale of the beauty cream product, the user must sufficiently prove that she
registered or used it before anybody else did. The petitioner’s copyright and patent registration of
the name and container would not guarantee her the right to the exclusive use of the same for
the reason that they are not appropriate subjects of the said intellectual rights. Consequently, a
preliminary injunction order cannot be issued for the reason that the petitioner has not proven that
she has a clear right over the said name and container to the exclusion of others, not having
proven that she has registered a trademark thereto or used the same before anyone did.
UNITED FEATURE SYNDICATE, INC., petitioner, vs. MUNSINGWEAR CREATION
MANUFACTURING COMPANY, respondent.

Petitioner’s claim:
Petitioner is asking for the cancellation of the registration of trademark CHARLIE BROWN
(Registration No. SR. 4224) in the name of respondent MUNSINGWEAR, alleging that petitioner
is damaged by the registration of the trademark CHARLIE BROWN of T-Shirts under Class 25
with the Registration No. SR-4224 dated September 12, 1979 in the name of Munsingwear
Creation Manufacturing Co., Inc., on the following grounds: (1) that respondent was not entitled
to the registration of the mark CHARLIE BROWN, & DEVICE at the time of application for
registration; (2) that CHARLIE BROWN is a character creation or a pictorial illustration, the
copyright to which is exclusively owned worldwide by the petitioner; (3) that as the owner of the
pictorial illustration CHARLIE BROWN, petitioner has since 1950 and continuously up to the
present, used and reproduced the same to the exclusion of others; (4) that the respondent-
registrant has no bona fide use of the trademark in commerce in the Philippines prior to its
application for registration.
Respondent’s claim:
-It uses, the trademark "CHARLIE BROWN" & "DEVICE" on children's wear such as T-shirts,
undershirts, sweaters, brief and sandos, in class 25; whereas "CHARLIE BROWN" is used only
by petitioner as character, in a pictorial illustration used in a comic strip appearing in newspapers
and magazines. It has no trademark significance and therefore respondent-registrant's use of
"CHARLIE BROWN" & "DEVICE" is not in conflict with the petitioner's use of "CHARLIE BROWN"
-Relied on the ruling on October 2, 1984 in which the Director of the Philippine Patent Office
rendered a decision in this case 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.

Issue:WHETHER THE RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE

OF DISCRETION AMOUNTING TO EXCESS OF JURISDICTION WHEN BY DISMISSING THE
APPEAL TO IT FROM THE DECISION OF THE DIRECTOR OF PATENTS, IT KNOWINGLY
DISREGARDED ITS OWN DECISION IN AC-GR. SP. NO. 0342, WHICH WAS AFFIRMED BY
THIS HONORABLE SUPREME COURT TO THE EFFECT THAT A COPYRIGHTED
CHARACTER MAY NOT BE APPROPRIATED AS A TRADEMARK BY ANOTHER UNDER
PRESIDENTIAL DECREE NO. 49.

S.C. Ruling:

The petitioner is impressed with merit. Since the name "CHARLIE BROWN" and its pictorial
representation were covered by a copyright registration way back in 1950 the same are entitled
to protection under PD No. 49, otherwise known as the "Decree on Intellectual Property".

Aside from its copyright registration, petitioner is also the owner of several trademark
registrations and application for the name and likeness of "CHARLIE BROWN" which is the duly
registered trademark and copyright of petitioner United Feature Syndicate Inc. as early as 1957
and additionally also as TV SPECIALS featuring the "PEANUTS" characters "CHARLIE
BROWN”.

It is undeniable from the records that petitioner is the actual owner of said trademark due to its
prior registration with the Patent's Office.
Morrissey v. Procter & Gamble
Brief Fact Summary. Procter & Gamble (Defendant) used a contest rule very similar to
that which Morrissey (Plaintiff) had copyrighted and used in a sales promotion contest.

Synopsis of Rule of Law. A rule incidental to the operation of a noncopyrightable contest

cannot itself be copyrighted if the information it conveys is so simple that there are only a
number of ways in which it can be expressed.

Facts. Morrissey (Plaintiff) copyrighted the rules it had used in a sweepstakes contest
revolving around the contestants’ social security numbers. While conducting a similar
type contest, Procter & Gamble (Defendant) used a very similar rule. It explained that the
name, address, and social security number of the participant should be printed on paper
or a box top; that the official rules were available at local dealers; that the social security
number of another family member could be used if one did not have his own number,
etc. When Morrissey (Plaintiff) brought suit for copyright infringement, the district court
found the contest itself to be noncopyrightable. It then held that the rule springing from it
contained no original creative authorship and was noncopyrightable. Morrissey (Plaintiff)
appealed.

Issue. If a rule incidental to the operation of a noncopyrightable contest conveys

information so simple that there are only a number of ways in which it can be expressed,
can the rule be copyrighted?

Held. (Aldrich, C.J.) No. If the information conveyed in a rule incidental to the operation of a
noncopyrightable contest is so simple that there are only a number of ways in which it can be
expressed, the rule cannot be copyrighted. Permitting such rules to be copyrighted would be
like giving a copyright on the contest itself to someone smart enough to simply copyright the
number of rule variations possible for running the contest. The rule at issue here was of this
nature and therefore was not copyrightable by Morrissey (Plaintiff). Affirmed.

Discussion. The court relied on its interpretation of Baker v. Selden, 101 U.S. 99 (1879), as
holding that certain kinds of expression are noncopyrightable, such as utilitarian forms. This
flies in the face of commentators who continue to argue that Baker v. Selden held only that
otherwise prohibited copying that is necessary to make use of a noncopyrightable system or art
does not constitute infringement, whereas copying for explanatory purposes does.
Brandir International, Inc. v. Cascade Pacific Lumber Co
Brief Fact Summary.Brandir International, Inc. (Plaintiff) sold a wire sculpture as a
bicycle rack that by was deemed not to be copyrightable because it was an industrial
design not subject to copyright protection.

Synopsis of Rule of Law. Copyrightability ultimately depends on the extent to which the
work reflects artistic expression not restricted by functional considerations.

Facts. After seeing undulating wire sculptures, a friend suggested to the artist, the chief
owner of Brandir International, Inc. (Brandir) (Plaintiff), that the sculptures would make
excellent bicycle racks. Plaintiff then started to manufacture and sell bike racks derived
in part from one or more of the works of art. When Plaintiff discovered that Cascade
Pacific Lumber (Defendant) was selling a similar product, it included a copyright notice
with its products and applied to the Copyright Office for registration. The Copyright Office
denied the applications for registration as the bicycle racks did not include any element
that was capable of independent existence as a copyrightability, and the district court
granted summary judgment on the copyright claim. Plaintiff appealed.

Issue. Should copyrightability ultimately depend on the extent to which the work reflects
artistic expression not restricted by functional considerations?

Held. (Oakes, J.) Yes. Copyrightability ultimately should depend on the extent to which the
work reflects artistic expression not restricted by functional considerations. If design elements
reflect a merger of aesthetic and functional considerations, the artistic aspects of a work cannot
be said to be conceptually separable from the utilitarian elements. The final form of the bicycle
rack sold by Brandir (Plaintiff) is basically a product of industrial design. Form and function are
inextricably intertwined in the rack, its ultimate design being as much the result of utilitarian
pressures as aesthetic choices. The original aesthetic elements have clearly been adapted to
accommodate and further a utilitarian purpose. Affirmed.

Concurrence. (Winter, J.) The relevant question should be whether the design of a
useful article, however intertwined with the article’s utilitarian aspects, causes an ordinary
reasonable observer to perceive an aesthetic concept not related to the article’s use. The
answer to this question is clear in this case since any reasonable observer would easily
see the bicycle rack as an ornamental sculpture. The Copyright Act expressly states that
the legal test is how the final article is perceived, not how it was developed at various
stages along the way.

Discussion. The majority in this case adopted a test suggested by Professor Denicola in
his article “Applied Art and Industrial Design,”� 67 Min. L. Rev. 707 (1983). The Winter
dissent suggested applying a different test and another dissent suggested using a
temporal displacement test. In general, if a work is a useful article, the artistic elements
have to be separate in order for the work to be copyrightable.
Pearl & Dean (Phil), Inc. vs Shoemart, Inc.

Pearl & Dean (Phil), Inc. is a corporation engaged in the manufacture of advertising display
units called light boxes. In January 1981, Pearl & Dean was able to acquire copyrights over
the designs of the display units. In 1988, their trademark application for “Poster Ads” was
approved; they used the same trademark to advertise their light boxes.
In 1985, Pearl & Dean negotiated with Shoemart, Inc. (SM) so that the former may be
contracted to install light boxes in the ad spaces of SM. Eventually, SM rejected Pearl
& Dean’s proposal.
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 & Dean’s trademark is only
applicable to envelopes and stationeries and not to the type of ad spaces owned by SM. SM
also averred that “Poster Ads” is a generic term hence it is not subject to trademark
registration. SM also averred that the actual light boxes are not copyrightable. The RTC ruled
in favor of Pearl & Dean. But the Court of Appeals ruled in favor of SM.
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 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 being authorized, uses a copyrighted architectural plan
to construct a structure. This is because the copyright does not extend to the structures
themselves.
On the trademark infringement allegation, the words “Poster Ads” are a simple contraction of
the generic term poster advertising. In the absence of any convincing proof that “Poster Ads”
has acquired a 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.
UNILEVER PHILIPPINES (PRC), INC., petitioner, vs. THE HONORABLE COURT OF
APPEALS and PROCTER AND GAMBLE PHILIPPINES, INC., respondents.
In this petition for review under Rule 45 of the Rules of Court, petitioner assails the February 24, 1995 decision 1 of
the Court of Appeals (CA) in CA-G.R. SP No. 35242 entitled "Unilever Philippines (PRC), Inc. v. Honorable
Fernando V. Gorospe, Jr. and Procter and Gamble Philippines, Inc. (P&GP)" which affirmed the issuance by the
court a quo of a writ of preliminary injunction against it. The writ enjoined petitioner from using and airing, until
further orders of the court, certain television commercials for its laundry products claimed to be identical or similar
to its "double tug" or "tac-tac" key visual. 2

Petitioner alleges that the writ of preliminary injunction was issued by the trial court (and affirmed by the CA)
without any evidence of private respondent's clear and unmistakable right to the writ. Petitioner further contends that
the preliminary injunction issued against it already disposed of the main case without trial, thus denying petitioner of
any opportunity to present evidence on its behalf.

The antecedents show that on August 24, 1994, private respondent Procter and Gamble Phils., Inc. filed a complaint
for injunction with damages and a prayer for temporary restraining order and/or writ of preliminary injunction
against petitioner Unilever, alleging that:

1.5. As early as 1982, a P&G subsidiary in Italy used a key visual in the advertisement of its laundry detergent
and bleaching products. This key visual known as the "double-tug" or "tac-tac" demonstration shows the fabric
being held by both hands and stretched sideways.

1.6. The "tac-tac" was conceptualized for P&G by the advertising agency Milano and Gray of Italy in 1982. The
"tac-tac" was used in the same year in an advertisement entitled "All aperto" to demonstrate the effect on fabrics of
one of P&GP's products, a liquid bleach called "Ace."

xxx xxx xxx

1.7. Since then, P&G has used the "tac-tac" key visual in the advertisement of its products. In fact, in 1986, in
Italy, the "tac-tac" key visual was used in the television commercial for "Ace" entitled "Kite."

1.8. P&G has used the same distinctive "tac-tac" key visual to local consumers in the Philippines. HCATEa

xxx xxx xxx

1.10. Substantially and materially imitating the aforesaid "tac-tac" key visual of P&GP and in blatant disregard
of P&GP's intellectual property rights, Unilever on 24 July 1993 started airing a 60 second television commercial
"TVC" of its "Breeze Powerwhite" laundry product called "Porky." The said TVC included a stretching visual
presentation and sound effects almost [identical] or substantially similar to P&GP's "tac-tac" key visual.

xxx xxx xxx

1.14. On July 15, 1994, P&GP aired in the Philippines, the same "Kite" television advertisement it used in Italy
in 1986, merely dubbing the Italian language with Filipino for the same produce "Ace" bleaching liquid which
P&GP now markets in the Philippines.

1.15. On August 1, 1994, Unilever filed a Complaint with the Advertising Board of the Philippines to prevent
P&GP from airing the "Kite" television advertisement. 3

On August 26, 1994, Judge Gorospe issued an order granting a temporary restraining order and setting it for hearing
on September 2, 1994 for Unilever to show cause why the writ of preliminary injunction should not issue. During
the hearing on September 2, 1994, P&GP received Unilever's answer with opposition to preliminary injunction.
P&GP filed its reply to Unilever's opposition to a preliminary injunction on September 6, 1994.
During the hearing on September 9, 1994, Judge Gorospe ordered petitioner to submit a sur-rejoinder. P&GP
received Unilever's rejoinder to reply on September 13, 1994. The following day, on September 14, 1994, P&GP
filed its sur-reply to Unilever's rejoinder.

On September 19, 1994, P&GP received a copy of the order dated September 16, 1994 ordering the issuance of a
writ of preliminary injunction and fixing a bond of P100,000. On the same date, P&GP filed the required bond
issued by Prudential Guarantee and Assurance, Inc.

On September 21, 1994, petitioner appealed to the CA assigning the following errors allegedly committed by the
court a quo, to wit:

PUBLIC RESPONDENT HAD ACTED WITHOUT OR IN EXCESS OF JURISDICTION AND WITH GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN ISSUING THE WRIT OF
PRELIMINARY INJUNCTION IN VIOLATION OF THE RULES ON EVIDENCE AND PROCEDURE,
PARTICULARLY OF SEC. 3 (a), RULE 58 OF THE REVISED RULES OF COURT AND OF THE
PREVAILING JURISPRUDENCE.

PUBLIC RESPONDENT IN ISSUING THE VOID ORDER DATED SEPTEMBER 16, 1994, HAD, IN EFFECT,
ALREADY PREJUDGED THE MERITS OF THE MAIN CASE.

PUBLIC RESPONDENT HAD ISSUED THE VOID ORDER ACCORDING RELIEF TO A NON-PARTY IN
CIVIL CASE NO. 94-2434 WITHOUT JURISDICTION. THEDcS

PUBLIC RESPONDENT IN ISSUING THE VOID ORDER HAD DEPRIVED PETITIONER OF SUBSTANTIVE
AND PROCEDURAL DUE PROCESS; PUBLIC RESPONDENT HAD FORECLOSED PETITIONER'S RIGHT
AND THE OPPORTUNITY TO CROSS-EXAMINE PROCTER'S WITNESSES ABAD AND HERBOSA. 4

On February 24, 1995, the CA rendered its decision finding that Judge Gorospe did not act with grave abuse of
discretion in issuing the disputed order. The petition for certiorari was thus dismissed for lack of merit.

After a careful perusal of the records, we agree with the CA and affirm its decision in toto:

Petitioner does not deny that the questioned TV advertisements are substantially similar to P&GP's "double tug" or
"tac-tac" key visual. However, it submits that P&GP is not entitled to the relief demanded, which is to enjoin
petitioner from airing said TV advertisements, for the reason that petitioner has Certificates of Copyright
Registration for which advertisements while P&GP has none with respect to its "double-tug" or "tac-tac" key visual.
In other words, it is petitioner's contention that P&GP is not entitled to any protection because it has not registered
with the National Library the very TV commercials which it claims have been infringed by petitioner.

We disagree. Section 2 of PD 49 stipulates that the copyright for a work or intellectual creation subsists from the
moment of its creation. Accordingly, the creator acquires copyright for his work right upon its creation . . . Contrary
to petitioner's contention, the intellectual creator's exercise and enjoyment of copyright for his work and the
protection given by law to him is not contingent or dependent on any formality or registration. Therefore, taking the
material allegations of paragraphs 1.3 to 1.5 of P&GP's verified Complaint in the context of PD 49, it cannot be
seriously doubted that at least, for purposes of determining whether preliminary injunction should issue during the
pendency of the case, P&GP is entitled to the injunctive relief prayed for in its Complaint.

The second ground is likewise not well-taken. As adverted to earlier, the provisional remedy of preliminary
injunction will not issue unless it is shown in the verified complaint that plaintiff is probably entitled to the relief
demanded, which consists in whole or in part in restraining the commission or continuance of the acts complained
of. In view of such requirement, the court has to make a tentative determination if the right sought to be protected
exists and whether the act against which the writ is to be directed is violative of such right. Certainly, the court's
determination as to the propriety of issuing the writ cannot be taken as a prejudgment of the merits of the case
because it is tentative in nature and the writ may be dissolved during or after the trial if the court finds that plaintiff
was not entitled to it. . .
Obviously, the determination made by the court a quo was only for purposes of preliminary injunction, without
passing upon the merits of the case, which cannot be done until after a full-blown hearing is conducted.

The third ground is patently unmeritorious. As alleged in the Complaint P&GP is a subsidiary of Procter and
Gamble Company (P&G) for which the "double tug" or "tac-tac" key visual was conceptualized or created. In that
capacity, P&GP used the said TV advertisement in the Philippines to promote its products. As such subsidiary,
P&GP is definitely within the protective mantle of the statute (Sec. 6, PD 49).

Finally, We find the procedure adopted by the court a quo to be in order. . .

The record clearly shows that respondent Judge followed the (procedure provided for in Section 5, Rule 58, as
amended by BP 224, and Paragraph A(8) of the Interim Rules). In fact, the court a quo set the incident for hearing
on September 2, 1994, at which date petitioner was ordered to show cause why the writ should not be issued.
Petitioner filed an Opposition to the application for preliminary injunction. The same incident was again set for
hearing on September 9, 1994, during which the parties made some manifestations in support of their respective
positions. Subsequent to such hearing petitioner filed a Reply to P&GP's Rejoinder to its Opposition. Under the
foregoing circumstances, it is absurd to even suggest that petitioner was not given its day in court in the matter of
the issuance of the preliminary injunctive relief.

There was of course extreme urgency for the court a quo to act on plaintiff's application for preliminary injunction.
The airing of TV commercials is necessarily of limited duration only. Without such temporary relief, any permanent
injunction against the infringing TV advertisements of which P&GP may possibly succeed in getting after the main
case is finally adjudicated could be illusory if by then such advertisements are no longer used or aired by petitioner.
It is therefore not difficult to perceive the possible irreparable damage which P&GP may suffer if respondent Judge
did not act promptly on its application for preliminary injunction. 5

Preliminary injunction is a provisional remedy intended to provide protection to parties for the preservation of their
rights or interests during the pendency of the principal action. 6 Thus, Section 1, Rule 58 of the Rules of Court
provides:

Section 1. Preliminary injunction defined; classes. — A preliminary injunction is an order granted at any
stage of an action or proceeding prior to the judgment or final order, requiring a party or a court, agency or a person
to refrain from a particular act or acts. It may also require the performance of a particular act or acts, in which case it
shall be known as a preliminary mandatory injunction.

Injunction is resorted to only when there is a pressing necessity to avoid injurious consequences which cannot be
remedied under any standard compensation. 7 As correctly ruled by the CA, there was an extreme urgency to grant
the preliminary injunction prayed for by P&GP considering that TV commercials are aired for a limited period of
time only. In fact, this Court takes note of the fact that the TV commercial in issue — the Kite TV advertisement —
is no longer aired today, more than 10 years after the injunction was granted on September 16, 1994.

The sole objective of a writ of preliminary injunction is to preserve the status quo until the merits of the case can be
heard fully. 8 A writ of preliminary injunction is generally based solely on initial and incomplete evidence. 9 Thus,
it was impossible for the court a quo to fully dispose of the case, as claimed by petitioner, without all the evidence
needed for the full resolution of the same. To date, the main case still has to be resolved by the trial court.

The issuance of a preliminary injunction rests entirely on the discretion of the court and is generally not interfered
with except in cases of manifest abuse. 10 There was no such abuse in the case at bar, especially because petitioner
was given all the opportunity to oppose the application for injunction. The fact was, it failed to convince the court
why the injunction should not be issued. Thus, in Santos v. Court of Appeals, 11 we held that no grave abuse of
discretion can be attributed to a judge or body issuing a writ of preliminary injunction where a party has not been
deprived of its day in court as it was heard and it exhaustively presented all its arguments and defenses.

WHEREFORE, the petition is hereby DENIED.

FRANCISCO G. JOAQUIN, JR., and BJ PRODUCTIONS, INC., petitioners, vs. HONORABLE
FRANKLIN DRILON, GABRIEL ZOSA, WILLIAM ESPOSO, FELIPE MEDINA, JR., and CASEY
FRANCISCO, respondents.

Petitioner’s Claim:

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 claims that there is an
infringement on the copyright of the show "RHODA AND ME" both in content and in the execution of the
video presentation are established because respondent's "IT'S A DATE" is practically an exact copy of
complainant's "RHODA AND ME" because of substantial similarities. As may [be] gleaned from the
evidence on record, the substance of the television productions complainant's "RHODA AND ME" and
Zosa's "IT'S A DATE" is that two matches are made between a male and a female, both single, and the two
couples are treated to a night or two of dining and/or dancing at the expense of the show. The major concepts
of both shows is the same. Any difference appear mere variations of the minor concepts.

Respondent’s Claim:

Both public and private respondents maintain that petitioners failed to establish the existence of probable
cause due to their failure to present the copyrighted master videotape of Rhoda and Me. They contend that
petitioner BJPI's copyright covers only a specific episode of Rhoda and Me and that the formats or concepts
of dating game shows are not covered by copyright protection under P.D. No. 49.

Issue: Whether the format and mechanics of a TV show may be subject of a copyright.

S.C. Ruling:

To begin with the format of a show is not copyrightable. Section 2 of P.D. No. 49, otherwise known as the
DECREE ON INTELLECTUAL PROPERTY, enumerates the classes of work entitled to copyright
protection, does not include the format or mechanics of a television show. For this reason, the protection
afforded by the law cannot be extended to cover them. The copyright does not extend to an idea, procedure,
process, system, method of operation, concept, principle, or discovery, regardless of the form in which it is
described, explained, illustrated, or embodied in such work.
SAMBAR vs. LEVI STRAUSS

Venancio Sambar, doing business under the name and style of CVS Garment Ent. vs. Levi Strauss & Co. and Levi
Strauss (Phil.) Inc.
Doctrine: To be entitled to copyright, the thing being copyrighted must be original, created by the author through his
own skill, labor and judgment, without directly copying or evasively imitating the work of another.

Facts: Private respondents, through a letter, demanded that CVS Garment Enterprises (CVSGE) desist from using
their stitched arcuate design on the Europress jeans which CVSGE advertised in the Manila Bulletin.

CVSGE asserted that the arcuate design on the back pockets of the Europress jeans was different than that of
Levi’s and that CVSGE had a copyright on the design it was using.

Private respondents allege that Levi Strauss and Co. (LS&Co.), an internationally known clothing
manufacturer, owns the arcuate design trademark which was registered under U.S. Trademark Registration and in the
Principal Register of trademarks with the Philippine Patent Office; and that CVSGIC* and Venancio Sambar, without
the consent and authority of private respondents and in infringement and unfair competition, sold and advertised, and
despite demands to cease and desist, continued to manufacture, sell and advertise denim pants under the brand name
Europress with back pockets bearing a design similar to the arcuate trademark of private respondents, thereby causing
confusion on the buying public, prejudicial to private respondents goodwill and property right.

*CVSGE already stopped operation and CVSGIC took over when the original summons was served.

CVSGIC admitted it manufactured, sold and advertised and was still manufacturing and selling denim pants
under the brand name of Europress, bearing a back pocket design of two double arcs meeting in the middle. However,
it denied that there was infringement or unfair competition because the display rooms of department stores where
Levis and Europress jeans were sold were distinctively segregated by billboards and other modes of
advertisement. CVSGIC avers that the public would not be confused on the ownership of such known trademark as
Levis, Jag, Europress, etc… Also, CVSGIC claimed that it had its own original arcuate design, as evidenced by
Copyright Registration No. 1-1998, which was very different and distinct from Levis design.

The trial court issued a writ of preliminary injunction, which it later made permanent, restraining CVSGIC
and Sambar manufacturing, advertising and selling pants with the arcuate design on their back pockets and ordered
CVSGIC and Sambar to pay jointly and solidarily P50, 000 as temperate and nominal damages, P10, 000 as exemplary
damages and P25, 000 as attorney’s fees and litigation expenses.

The court granted private respondents’ MR praying for cancellation of petitioner’s copyright registration. CA
decided in favor of private respondents.

Issue: WON the cancellation of petitioner’s copyright is proper.

Ruling: The award of damages and cancellation of petitioner’s copyright are appropriate. Award of damages is
clearly provided in Section 23 of RA 166 or Trade Mark Law while cancellation of petitioners copyright finds basis
on the fact that the design was a mere copy of that of private respondents trademark.

To be entitled to copyright, the thing being copyrighted must be original, created by the author through his
own skill, labor and judgment, without directly copying or evasively imitating the work of another.

However, the Court agrees with petitioner that it was error for the CA to affirm the award of nominal damages
combined with temperate damages by the RTC. What respondents are entitled to is an award for temperate damages,
not nominal damages. For although the exact amount of damage or loss cannot be determined with reasonable certainty,
the fact that there was infringement means they suffered losses for which they are entitled to moderate damages. We
find that the award of P50, 000 as temperate damages fair and reasonable, considering the circumstances herein as
well as the global coverage and reputation of private respondents LS&Co. and Levi Strauss (Phil.), Inc.
CHING V. SALINAS, SR. (G.R. NO. 161295)
Facts:
Petitioner Ching is a maker and manufacturer of a utility model, Leaf Spring Eye Bushing for
Automobile, for which he holds certificates of copyright registration. Petitioner’s request to the
NBI to apprehend and prosecute illegal manufacturers of his work led to the issuance of search
warrants against respondent Salinas, alleged to be reproducing and distributing said models in
violation of the IP Code. Respondent moved to quash the warrants on the ground that petitioner’s
work is not artistic in nature and is a proper subject of a , not copyright. Petitioner insists that the
IP Code protects a work from the moment of its creation regardless of its nature or purpose. The
trial court quashed the warrants. Petitioner argues that the copyright certificates over the model are
prima facie evidence of its validity. CA affirmed the trial court’s decision.
Issues:
(1) Whether or not petitioner’s model is an artistic work subject to copyright protection.
(2) Whether or not petitioner is entitled to copyright protection on the basis of the certificates of
registration issued to it.
Ruling:
(1) NO. As gleaned from the specifications appended to the application for a copyright certificate
filed by the petitioner, the said Leaf Spring Eye Bushing for Automobile and Vehicle Bearing
Cushion are merely utility models. As gleaned from the description of the models and their
objectives, these articles are useful articles which are defined as one having an intrinsic utilitarian
function that is not merely to portray the appearance of the article or to convey information. Plainly,
these are not literary or artistic works. They are not intellectual creations in the literary and artistic
domain, or works of applied art. They are certainly not ornamental designs or one having
decorative quality or value. Indeed, while works of applied art, original intellectual, literary and
artistic works are copyrightable, useful articles and works of industrial design are not. A useful
article may be copyrightable only if and only to the extent that such design incorporates pictorial,
graphic, or sculptural features that can be identified separately from, and are capable of existing
independently of the utilitarian aspects of the article. In this case, the bushing and cushion are not
works of art. They are, as the petitioner himself admitted, utility models which may be the subject
of a patent.
(2) NO. No copyright granted by law can be said to arise in favor of the petitioner despite the
issuance of the certificates of copyright registration and the deposit of the Leaf Spring Eye Bushing
and Vehicle Bearing Cushion. Indeed, in Joaquin, Jr. v.Drilon and Pearl & Dean (Phil.),
Incorporated v. Shoemart, Incorporated, the Court ruled that:
Copyright, in the strict sense of the term, is purely a statutory right. It is a new or independent right
granted by the statute, and not simply a pre-existing right regulated by it. 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 persons, and on terms and conditions specified in the statute. Accordingly,
it can cover only the works falling within the statutory enumeration or description.
Ownership of copyrighted material is shown by proof of originality and copyrightability. To
discharge his burden, the applicant may present the certificate of registration covering the work or,
in its absence, other evidence. A copyright certificate provides prima facie evidence of originality
which is one element of copyright validity. It constitutes prima facie evidence of both validity and
ownership and the validity of the facts stated in the certificate.
ABS-CBN CORPORATION v. FELIPE GOZON, GR No. 195956, 2015-03-11
Facts:
The controversy arose from GMA-7's news coverage on the homecoming of Filipino overseas
worker and hostage victim Angelo dela Cruz on July 22, 2004. As summarized by the Court of
Appeals:
Overseas Filipino worker Angelo dela Cruz was kidnapped by Iraqi militants and as a condition for
his release, a demand was made for the withdrawal of Filipino troops in Iraq. After negotiations, he
was released by his captors and was scheduled to return to the... country in the afternoon of 22 July
2004. Occasioned by said homecoming and the public interest it generated, both . . . GMA Network,
Inc. . . . and [petitioner] made their respective broadcasts and coverage of the live event.
ABS-CBN allowed Reuters Television Service (Reuters) to air the... footages it had taken earlier
under a special embargo agreement.
ABS-CBN alleged that under the special embargo agreement, any of the footages it took would be
for the "use of Renter's international subscribers only, and shall be considered and treated by
Reuters under 'embargo' against use by other subscribers in the Philippines. . . . [N]o... other
Philippine subscriber of Reuters would be allowed to use ABS-CBN footage without the latter's
consent."
GMA-7... subscribes to both Reuters and Cable News Network (CNN). It received a live video feed of
the coverage of Angelo dela Cruz's arrival from Reuters.
GMA-7 immediately carried the live newsfeed in its program "Flash Report," together with its live
broadcast.[13] Allegedly, GMA-7 did not receive any notice or was not aware that Reuters was
airing footages of ABS-CBN.[14] GMA-7's news... control room staff saw neither the "No Access
Philippines" notice nor a notice that the video feed was under embargo in favor of ABS-CBN.
ABS-CBN filed the Complaint for copyright infringement under Sections 177[16] and 211[17] of the
Intellectual Property Code.
Assistant City Prosecutor Dindo Venturanza issued the Resolution[19] finding probable cause to
indict Dela Peña-Reyes and Manalastas.
Department of Justice Secretary Raul M. Gonzalez (Secretary Gonzalez) ruled in favor of...
respondents and held that good faith may be raised as a defense in the case.
Department of Justice Acting Secretary Alberto C. Agra (Secretary Agra) issued the Resolution (Agra
Resolution) that reversed the Gonzalez Resolution and found probable cause
He ruled that:
[w]hile good faith may be a defense in copyright infringement, the same is a disputable
presumption that must be proven in a full-blown trial. Disputable presumptions may be
contradicted and overcome by other evidence. Thus, a full-blown trial is the proper venue... where
facts, issues and laws are evaluated and considered. The very purpose of trial is to allow a party to
present evidence to overcome the disputable presumptions involved.
Court of Appeals rendered the Decision granting the Petition and reversing and setting aside the
Agra Resolution.
Court of Appeals said:
However, it is an admitted fact that petitioner GMA had only aired a five (5) second footage of the
disputed live video feed that it had received from Reuters and CNN as a subscriber. Indeed,
petitioners had no notice of the right of ownership of private respondent over the... same. Without
notice of the "No Access Philippines" restriction of the live video feed, petitioner cannot he faulted
for airing a live video feed from Reuters and CNN.
Verily, as aptly opined by Secretary Gonzalez in his earlier Resolution, the act of petitioners in airing
the five (5) second footage was undeniably attended by good faith and it thus serves to exculpate
them from criminal liability under the Code. While the
Intellectual Properly Code is a special law, and thus generally categorized as malum prohibitum, it
bears to stress that the provisions of the Code itself do not ipso facto penalize a person or entity for
copyright infringement by the mere fact that one had used a... copyrighted work or material.
Certainly so, in the exercise of one's moral and economic or copyrights, the very provisions of Part
IV of the Intellectual Property Code provide for the scope and limitations on copyright protection
under Section 184 and in fact permit fair use of copyrighted work under Section

185. With the aforesaid statutory limitations on one's economic and copyrights and the
allowable instances where the other persons can legally use a copyrighted work, criminal
culpability clearly attaches only when the infringement had been knowingly and
intentionally... committed.

Issues:
whether there is probable cause to charge respondents with infringement under Republic Act No.
8293, otherwise known as the Intellectual Property Code
Third, whether there was fair use of the broadcast material;
Fourth, whether lack of knowledge that a material is copyrighted is a defense against copyright
infringement;
Fifth, whether good faith is a defense in a criminal prosecution for violation of the Intellectual
Property Code
Ruling:
V
ABS-CBN claims that news footage is subject to copyright and prohibited use of copyrighted
material is punishable under the Intellectual Property Code. It argues that the new footage is not a
"newsworthy event" but "merely an account of the arrival of Angelo dela Cruz in the
Philippines — the latter being the newsworthy event":
On the other hand, respondents argue that ABS-CBN's news footage of Angelo dela Cruz's arrival is
not copyrightable or subject to protection
Certainly, the arrival of Angelo [d]ela Cruz, which aroused public attention and the consciousness of
the Filipino people with regard to their countrymen, OFWs working in foreign countries and how
the Philippine government responds to the issues concerning them,... is "news". There is no
ingenuity or inventiveness added in the said news footage.
The news footage is copyrightable.
News or the event itself is not copyrightable. However, an event can be captured and presented in a
specific medium. As recognized by this court in Joaquin, television "involves a whole spectrum of
visuals and effects, video and audio."[95] News... coverage in television involves framing shots,
using images, graphics, and sound effects. It involves creative process and originality. Television
news footage is an expression of the news.
Pacific & Southern Co. v. Duncan,[98] which involves a News Monitoring Service's videotaping and
sale of WXIA-TVs news broadcasts:... it is equally well-settled that copyright protection does extend
to the reports themselves, as distinguished from the substance of... the information contained in
the reports.
Copyright protects the manner of expression of news reports, "the particular form or collocation of
words in which the writer has communicated it"
The idea/expression dichotomy is a complex matter if one is trying to determine whether a certain
material is a copy of another.101 This dichotomy would be more relevant in determining, for
instance, whether a stage play was an infringement of an author's book involving the same...
characters and setting. In this case, however, respondents admitted that the material under review
— which is the subject of the controversy — is an exact copy of the original. Respondents did not
subject ABS-CBN's footage to any editing of their own. The news footage did not... undergo any
transformation where there is a need to track elements of the original.
VI
Respondents point out that upon seeing ABS-CBN's reporter Dindo Amparo on the footage, GMA-7
immediately shut off the broadcast. Only five (5) seconds passed before the footage was cut. They
argue that this shows that GMA-7 had no prior knowledge of ABS-CBN's ownership of the... footage
or was notified of it. They claim that the Angelo dela Cruz footage is considered a short excerpt of
an event's "news" footage and is covered by fair use.
This court defined fair use as "a privilege to use the copyrighted material in a reasonable manner
without the consent of the copyright owner or as copying the theme or ideas rather than their
expression."[115] Fair use is an exception to the copyright... owner's monopoly of the use of the
work to avoid stifling "the very create vity which that law is designed to foster."
Determining fair use requires application of the four-factor test. Section 185 of the Intellectual
Property Code lists four (4) factors to determine if there was fair use of a copyrighted work:
The purpose and character of the use, including whether such use is of a commercial nature or is for
non-profit educational purposes;
The nature of the copyri ghted work;
The amount and substantiality of the portion used in relation to the copyrighted work as a whole;
and
The effect of the use upon the potential market for or value of the copyrighted work.
First, the purpose and character of the use of the copyrighted material must fall under those listed
in Section 185, thus: "criticism, comment, news reporting, teaching including multiple copies for
classroom use, scholarship, research, and similar purposes."[117] The purpose and character
requirement is important in view of copyright's goal to promote creativity and encourage creation
of works. Hence, commercial use of the copyrighted work can be weighed against fair use.
The "transformative test" is generally used in reviewing the purpose and character of the usage of
the copyrighted work.[118] This court must look into whether the copy of the work adds "new
expression, meaning or message" to transform it into something... else.[119] "Meta-use" can also
occur without necessarily transforming the copyrighted work used.[120]
Second, the nature of the copyrighted work is significant in deciding whether its use was fair. If the
nature of the work is more factual than creative, then fair use will be weighed in favor of the user.
Third, the amount and substantiality of the portion used is important to determine whether usage
falls under fair use. An exact reproduction of a copyrighted work, compared to a small portion of it,
can result in the conclusion that its use is not fair. There may also be cases... where, though the
entirety of the copyrighted work is used without consent, its purpose determines that the usage is
still fair.121 For example, a parody using a substantial amount of copyrighted work may be
permissible as fair use as opposed to a copy of a work produced purely... for economic gain.
Lastly, the effect of the use on the copyrighted work's market is also weighed for or against the
user. If this court finds that the use had or will have a negative impact on the copyrighted work's
market, then the use is deemed unfair.
the primary reason for copyrighting newscasts by broadcasters would seem to be to prevent
competing stations from rebroadcasting current news from the station with the best... coverage of
a particular news item, thus misappropriating a portion of the market share.
However, there are also many caveats with these exceptions. A common exception is that some
stations rebroadcast the news of others. The caveat is that generally, the two stations are not...
competing for market share. CNN, for example, often makes news stories available to local
broadcasters.
Whether the alleged five-second footage may be considered fair use is a matter of defense. We
emphasize that the case involves determination of probable cause at the preliminary investigation
stage. Raising the defense of fair use does not automatically mean that no infringement... was
committed. The investigating prosecutor has full discretion to evaluate the facts, allegations, and
evidence during preliminary investigation. Defenses raised during preliminary investigation are
subject to further proof and evaluation before the trial court. Given the... insufficiency of available
evidence, determination of whether the Angelo dela Cruz footage is subject to fair use is better left
to the trial court where the proceedings are currently pending.
GMA-7's rebroadcast of ABS-CBN's news footage without the latter's consent is not an issue. The
mere act of rebroadcasting without authority from the owner of the broadcast gives rise to the
probability that a crime was committed under the Intellectual Property Code.
VII
Respondents cannot invoke the defense of good faith to argue that no probable cause exists.
Infringement under the Intellectual Property Code is malum prohibitum. The Intellectual Property
Code is a special law. Copyright is a statutory creation
The general rule is that acts punished under a special law are malum prohibitum.[129] "An act
which is declared malum prohibitum, malice or criminal intent is completely immaterial."
Unlike other jurisdictions that require intent for a criminal prosecution of copyright infringement,
the Philippines does not statutorily support good faith as a defense. Other jurisdictions provide in
their intellectual property codes or relevant laws that mens rea,... whether express or implied, is an
element of criminal copyright infringement.
The Intellectual Property Code requires strict liability for copyright infringement whether for a civil
action or a criminal prosecution; it does not require mens rea or culpa
Respondents argue that live broadcast of news requires a different treatment in terms of good
faith, intent, and knowledge to commit infringement. To argue this point, they rely on the
differences of the media used in Habana et al. v. Robles, Columbia Pictures v. Court of
Appeals, and this case:
Petitioner ABS-CBN argues that lack of notice that the Angelo dela Cruz was under embargo is not a
defense in copyright infringement and cites the case of Columbia Pictures vs. Court of Appeals and
Habana et al. vs. Robles (310 SCRA 511). However, these cases... refer to film and literary work
where obviously there is "copying" from an existing material so that the copier knew that he is
copying from an existing material not owned by him. But, how could respondents know that what
they are "copying was not [theirs]" when they... were not copying but merely receiving live video
feed from Reuters and CNN which they aired? What they knew and what they aired was the
Reuters live video feed and the CNN feed which GMA-7 is authorized to carry in its news broadcast,
it being a subscriber of... these companies[.]
It is apt to stress that the subject of the alleged copyright infringement is not a film or literary work
but live broadcast of news footage. In a film or literary work, the infringer is confronted face to face
with the material he is allegedly copying and... therefore knows, or is presumed to know, that what
he is copying is owned by another. Upon the other hand, in live broadcast, the alleged infringer is
not confronted with the fact that the material he airs or re-broadcasts is owned by another, and
therefore, he... cannot be charged of knowledge of ownership of the material by another.
Respondents' arguments must fail.
To admit a... different treatment for broadcasts would mean abandonment of a broadcasting
organization's minimum rights, including copyright on the broadcast material and the right against
unauthorized re broadcast of copyrighted material. The nature of broadcast technology is
precisely... why related or neighboring rights were created and developed. Carving out an
exception for live broadcasts would go against our commitments under relevant international
treaties and agreements, which provide for the same minimum rights.
Contrary to respondents' assertion, this court in Habana,[150] reiterating the ruling in Columbia
Pictures,[151] ruled that lack of knowledge of infringement is not a valid defense. Habana and
Columbia
Pictures may have different factual scenarios from this case, but their rulings on copyright
infringement are analogous. In Habana, petitioners were the authors and copyright owners of
English textbooks and workbooks. The case was anchored on the protection of... literary and artistic
creations such as books. In Columbia Pictures, video tapes of copyrighted films were the subject of
the copyright infringement suit.
In Habana, knowledge of the infringement is presumed when the infringer commits the prohibited
act:
WHEREFORE, the Petition is partially GRANTED.

Baker v. Selden
Brief Fact Summary. Baker (Defendant) sold forms similar to forms contained in a
bookkeeping system within Selden’s (Plaintiff) copyrighted book.
Synopsis of Rule of Law. The copyright protection for a book explaining an art or system
extends only to the author’s unique explanation of it and does not prevent others from
using the system or the forms incidentally used.

Facts. Selden (Plaintiff) copyrighted a book in which he used in introductory essay

explaining his system of bookkeeping followed by forms to put the system to use. He had
arranged the columns and headings so that the entire operation of a day, week or month
was on a single page or on two pages facing each other. Baker (Defendant) then began
selling forms with columns and headings arranged differently to achieve the same
result. When Plaintiff successfully sued for copyright infringement, Defendant
appealed. He argued that the forms were non-copyrightable.

Issue. Does copyright protection for a book explaining an art or system prevent others
from using the system or the forms incidentally used?

Held. (Bradley, J.) No. The copyright protection for a book explaining an art or system extends
only to the author’s unique explanation of it and does not prevent others from using the system
or the forms incidentally used. To find that a copyright protected against use of the system itself
or the forms necessary to such use would be to grant protection similar to a patent without
requiring a showing of novelty. Copyright is based on originality, not novelty, and protects the
explanation of the system and not the use of the system. In this case, therefore, the copyright
Selden (Plaintiff) obtained could not give him the exclusive right to use the bookkeeping system
or the forms necessary to such use. Reversed and remanded.
Discussion. This case has been interpreted by many as allowing copying for use as opposed to
copying for the purpose of explanation. However, in applying this rule, some courts have gone
rather far and have allowed something to pass as copying for use when there were alternate ways
to arrange the words that could have easily been chosen to communicate the non-copyrightable
system or art. This has provoked much criticism of the interpretation previously mentioned
regarding the rule of this case.

Feist v. Rural Telephone Service Co

Brief Fact Summary. A publishing company used information from a telephone directory to
publish its own directory.

Synopsis of Rule of Law. To qualify for copyright protection, a work must be original to the
author, which means that the work was independently created by the author, and it possesses at
least some minimal degree of creativity. A work may be original even though it closely resembles
other works so long as the similarity is fortuitous, not the result of copying.
Facts. Rural Telephone Service Company, Inc. (Plaintiff) provides telephone service to several
communities. Due to a state regulation, it must issue an annual telephone directory, so it published
a directory consisting of white and yellow pages. The yellow pages have advertisements that
generate revenue. Feist Publications, Inc. (Defendant) is a publishing company whose directory
covers a larger range than a typical directory. Defendant distributes their telephone books free of
charge, and they also generate revenue through the advertising in the yellow pages. Plaintiff
refused to give a license to Defendant for the phone numbers in the area, so Defendant used
them without Plaintiff’s consent. Rural sued for copyright infringement.

Issue. Are the names, addresses, and phone numbers in a telephone directory able to be
copyrighted?
Held. No.
Facts cannot be copyrighted, however compilations of facts can generally be copyrighted.
To qualify for copyright protection, a work must be original to the author, which means that the
work was independently created by the author, and it possesses at least some minimal degree of
creativity. A work may be original even thought it closely resembles other works so long as the
similarity is fortuitous, not the result of copying.
Facts are not original. The first person to find and report a particular fact has not created the fact;
he has merely discovered its existence. Facts may not be copyrighted and are part of the public
domain available to every person.
Factual compilations may possess the requisite originality. The author chooses what facts to
include, in what order to place them, and how to arrange the collected date so they may be
effectively used by readers. Thus, even a directory that contains no written expression that could
be protected, only facts, meets the constitutional minimum for copyright protection if it features an
original selection or arrangement. But, even though the format is original, the facts themselves do
not become original through association. The copyright on a factual compilation is limited to
formatting. The copyright does not extend to the facts themselves.
To establish copyright infringement, two elements must be proven: ownership of a valid copyright
and copying of constituent elements of the work that are original. The first element is met in this
case because the directory contains some forward text. As to the second element, the information
contains facts, which cannot be copyrighted. They existed before being reported and would have
continued to exist if a telephone directory had never been published. There is no originality in the
formatting, so there is no copyrightable expression. Thus, there is no copyright infringement.
Discussion. Facts cannot be subject to copyright laws; otherwise there would be no spreading
of information or learning. Subjecting facts to copyright laws would mean that any time a person
used a fact found in a book, be it in a school paper, newspaper, or another book, that person
would be guilty of piracy.
Community for Creative Non-
Violence at al. v. Reid
Brief Fact Summary. Reid (Defendant) created a sculpture on commission from the
Community for Creative Non-Violence (Plaintiff), and contended that since he had not
been employed by it under common law agency principles, he owned the copyright of the
sculpture.

Synopsis of Rule of Law. Under common-law agency principles, one who creates an
artwork at the directive of another retains copyright upon it unless that other had employed
the artist.

Facts. The Community for Creative Non-Violence (CCNV) (Plaintiff) was a nonprofit
organization dedicated to advocacy for the cause of the homeless in the United States. It
negotiated with Reid (Defendant), a sculptor, to create a variation on the classic nativity
scene, depicting homeless persons. Agreement was finally reached and Defendant
made the sculpture out of a bronze-like material. Defendant worked in his studio with little
direction from CCNV (Plaintiff). Following the unveiling, Defendant registered a copyright
on the work. Subsequent to this, a disagreement arose between Plaintiff and Defendant
who had taken custody of the sculpture, over future exhibition thereof. Plaintiff filed an
action seeking to obtain possession of the work. The district court held Plaintiff to have
the right to exhibit the statue. The federal circuit of the court of appeals reversed, and the
United States Supreme Court granted review.

Issue. Under common-law agency principles, does one who creates an artwork at the
directive of another retains copyright upon it unless that other had employed the artist?

Held.(Marshall, J.) Yes. Under common-law agency principles, one who creates an artwork at
the directive of another retains copyright upon it unless that other had employed the artist. 17
U.S.C. § 201 (a) provides that copyright ownership vests initially in the work’s author, something
Reid (Defendant) in this case obviously was. Section 101 of the 1976 Copyright Act creates an
exception to this in the case of works created “for hire.” Section 101(2) mandates copyright
vestiture in the case where the author is an independent contractor of another, in specific
instances not applicable in this case. Section 101(1) provides that the work is one created “for
hire” if the work is created by an employee within the scope of his employment, and this
subsection is the only one that can divest Reid (Defendant) of copyright therein. “Employee” is
not defined in the section. This being so, the rule comes into play that words used in a statute
will be presumed to possess their normal meanings. Contrary to CCNV’s (Plaintiff) assertions,
“employee” is a narrower term than one over whom another exercises a measure of
control. Rather, “employee” has a particular meaning, derived from common-law agency
principles, wherein one party performs labor for another under circumstances in which that other
exerts substantial control over the work environment on the laborer, as well as the manner of
performance. Numerous factors figure in this equation, such as the level of skill required, tax
treatment of the putative employee, the singleness of the assignment, and the source of the
instrumentalities of the labor. In this instance, the work was highly skilled; Reid (Defendant) was
retained only for this single assignment, was not treated as an employee for tax purposes, and
provided his own work area and tools. The conclusion is mandated that, under agency principles,
Defendant was not an employee of P. Therefore, the § 101(1) exception to § 201(a) does not
apply, and the copyright belongs to Reid (Defendant). Affirmed.
Discussion. Sections 101(1) and 101(2) were the result of lengthy debate and compromise in
Congress. Before 19555, any commissioned work belonged to the hiring party. For the next
several years, changes in this rule were proposed many times. Finally, in 1965 the substantive
embodiment of current law was enacted.
Bobbs-Merrill Company v. Straus
210 U.S. 339 (1908)
• Bobbs-Merrill was a book publisher that owned the rights to a book called The Castaway.
Inside the book cover, they wrote a notice saying that the minimum retail sale price of the book
was $1, and if a retailer sells it for less than that they are infringing the copyright.
• Straus was a retailer who bought copies of the book from a wholesaler and started selling
them for 89ข. Bobbs-Merrill sued for copyright infringement.
o Bobbs-Merrill argued their ownership of the copyright gave them the exclusive right to
distribute, and that meant that they could revoke Straus' right to sell the books at any time.
o Straus argued that they didn't buy the book from Bobbs-Merrill, they bought it from a
wholesaler. Whatever deal Bobbs-Merrill might have made with the wholesaler didn't affect them
because they were not in privity with any contract between Bobbs-Merrill and the wholesaler.

• The US Supreme Court found for Straus.

o The US Supreme Court basically found that copyright law gave the copyright owner the
right to restrict others from making their own copies of a work. However, it did not give them any
rights to control what happened to books after they sold them.

• This case described what is now knows as the first sale doctrine, and is codified in 17 U.S.C.
ง109(a). The first sale doctrine basically says that once someone buys a legitimate copy of a work,
they can do whatever they want with it, including sell it to others, or lend it out, or whatever. They
just can't make extra copies of it.
o The first sale doctrine is what prevents used bookstores and libraries from being copyright
infringers.
o The first sale doctrine is sometimes known as the doctrine of exhaustion.
Campbell v. Acuff-Rose Music, Inc.
Brief Fact Summary. 2 Live Crew (Defendant) argued that its parody of Roy Orbison’s
song, “Oh, Pretty Woman,” was a fair use within the meaning of the Copyright Act of 1976.
The appellate court, however, concluded the parody was presumptively unfair because
of its commercial nature.

Synopsis of Rule of Law. For fair use purposes, the commercial purpose of a work is
only one element of the inquiry into the purpose and character of the work.

Facts. 2 Live Crew (Defendant) recorded a rap parody of the hit by Roy Orbison, “Oh,
Pretty Woman.” Acuff-Rose (Plaintiff), the copyright holder of the original song, brought
suit against 2 Live Crew (Defendant) for copyright infringement. The district court
granted summary judgment for 2 Live Crew (Defendant), concluding that its song made
fair use of Orbison’s original. The appeals court reversed and remanded. It concluded
that every commercial use is presumptively unfair and the blatantly commercial purpose
of 2 Live Crew’s (Defendant) version prevented it from constituting fair use. Defendant
appealed.

Issue. For fair use purposes, is the commercial purpose of a work the decisive element
of the inquiry into the purpose and character of the work?

Held. (Souter, J.) No. For fair use purposes, the commercial purpose of a work is only one
element of the inquiry into the purpose and character of the work. The other elements to be
considered are the nature of the copyrighted work, the amount and substantiality of the portion
used in relation to the copyrighted work as a whole, and the effect of the use upon the potential
market for the copyrighted work. In this case, it was error for the court of appeals to conclude that
the commercial nature of 2 Live Crew’s (Defendant) parody rendered it presumptively unfair. No
such evidentiary presumption exists for either the first factor (the character and purpose of the
use) or the fourth factor (market harm). The court also erred in holding that 2 Live Crew
(Defendant) had copied excessively from the Orbison original, considering the satiric purpose of
their version. Reversed and remanded to evaluate the amount taken from the original, its
transformative elements, and potential for market harm.

Discussion. Dictionaries define “parody” as a work of art or literature that imitates the
characteristic style of an author or a work for ridicule or comic effect. Copyright law recognizes
that a parodist must use some elements of a prior author’s composition in order to make a new
one that comments on that authors work. Parody needs to imitate an original to make its point,
but it may or may not be fair use depending on whether it could be seen as commenting on, or
criticizing, the original.
Habana vs. Robles

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."

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.
Harper & Row Publishers, Inc. v.
Nation Enterprises
Brief Fact Summary. Nation Enterprises (Defendant) argued that its use of quotes from
a yet-unpublished set of memoirs constituted fair use.

Synopsis of Rule of Law. Publication of parts of a work soon to be published does not
qualify as fair use.

Facts. Harper & Row Publishers, Inc. (Harper) (Plaintiff) obtained the rights to publish
President Ford’s memoirs, A Time to Heal. Time magazine contracted for the rights to
preview the work immediately before publication. Before the publication of the article by
Time magazine, Nation Enterprises (Defendant), publisher of The Nation magazine, got
a copy of the Ford manuscript. The Nation published an article that quoted the
manuscript about the Nixon pardon. Time then choose not to use the article as planned
and canceled its contract with Harper (Plaintiff). Plaintiff sued Defendant for copyright
infringement. The district court awarded damages for infringement. The Second Circuit
reversed, holding Nation Enterprises’ (Defendant) use to be a “fair use” under 17
U.S.C.107. The United States Supreme Court granted certiorari.

Issue. Does publication of parts of a work soon to be published qualify as fair use?

Held. (O’Connor, J.) No. Publication of parts of a work soon to be published does not qualify as
fair use. The idea behind the fair use doctrine as it was framed in the common law was that one
using a copyrighted work should not have to get a copyright holder’s permission to use the
copyrighted work in a case where a reasonable copyright holder would in fact grant permission.
Section 107 of the Copyright Act, which codified the doctrine, expressly noted in its legislative
history that it was not meant to change the common law. As for reasonableness, it is not
reasonable to expect a copyright holder to let another person “scoop” it by publishing his material
ahead of time. Regarding the language of § 107, the section lists four points to consider in
applying the doctrine. The two factors most relevant here are purpose of the use and effect on
the market. Usually, a fair use will not be one of economic competition with the copyright holder,
which is exactly what prior publication of a copyrighted work is. In addition, the effect on the market
of such a use is shown by what happened here: it greatly decreases the market value of the
copyrighted work. Therefore, the conclusion in this case, and in almost all cases, is that prior
publication of a work pending publication will not be a fair use. Reversed.

Discussion. The common law doctrine of “fair use” is well established. The Supreme Court
recognized the doctrine as early as 1841. In Folsom v. Marsh, 9 F. Cas. 342 (1841), Justice Story
allowed use of quotes by a reviewer as a “fair use.” A major application of the doctrine remains to
be the use of quotes in criticism of a work.
MANLY SPORTWEAR MANUFACTURING V.
DADODETTE ENTERPRISES (G.R.
NO. 165306)
Facts:
On the basis of information that respondent Dadodette Enterprises were in
possession of sporting goods or articles, the copyright of which belonged to
petitioner Manly, the NBI applied for search warrant before the trial court
which ruled on its issuance. Thereafter, respondent moved to quash the warrant
on the ground that petitioner’s goods are ordinary and not among the works
protected under the IP Code. The trial court annulled the warrant holding that
there were certificates of registration over the same goods issued earlier than
that of petitioner negating its claim that the goods were original works entitled
to copyright protection. CA affirmed.

Issue:
Whether or not the certificates of registration issued to petitioner is proof of its
ownership.

Ruling: NO.
Besides, no copyright accrues in favor of MANLY despite issuance of the
certificates of registration and deposit pursuant to Section 2, Rule 7 of the
Copyrights Safeguards and Regulations which states:
Sec. 2 Effects of Registration and Deposit of Work. The registration and
deposit of the work is purely for recording the date of registration and deposit
of the work and shall not be conclusive as to copyright ownership or the term
of the copyrights or the rights of the copyright owner, including neighboring
rights.
At most, the certificates of registration and deposit issued by the National
Library and the Supreme Court Library serve merely as a notice of recording
and registration of the work but do not confer any right or title upon the
registered copyright owner or automatically put his work under the protective
mantle of the copyright law. It is not a conclusive proof of copyright ownership.
As it is, non-registration and deposit of the work within the prescribed period
only makes the copyright owner liable to pay a fine.
ABS-CBN V. PHILIPPINE MULTI-MEDIA SYSTEM

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.
Phoenix Publishing House, Inc. v.
Jose T. Ramos & Socorro C. Ramos as National Bookstore and Court of Appeals

Facts

This petition originated in an action for damages arising from an alleged infringement of petitioner's
copyright for two books entitled "General Science Today for Philippine Schools, First Year" and "General
Science Today for Philippine Schools, Second Year," both authored by Gilman, Van Houten and Cornista
and first published in 1961. Named plaintiffs as "copyright proprietors of said books" were Phoenix
Publishing House, Inc., Purita Dancel-Cornista, Phil N. Gilman, and L. F. Van Houten. The complaint
charged that defendants, now herein private respondents "reprinted, published, distributed and sold
said books in gross violation of the Copyright Law and of plaintiffs' rights to their damage and prejudice"
and prayed for actual, moral and exemplary damages as well as for attorney's fees and expenses of
litigation.

After trial, judgment was rendered, the dispositive portion of which is as follows — "WHEREFORE,
judgment is hereby rendered, dismissing plaintiff's action. Instead, judgment is (sic) hereby rendered in
favor of the defendants and against the plaintiff(sic), and orders the latter to pay the defendants by way
of damages as and for attorney's fees the amount of P5,000.00. The writ of preliminary injunction is
hereby dissolved, and the copies of General Science Today mentioned in Exhibits M and M-1 are hereby
ordered returned to the defendants against proper receipt." (p. 54, Rollo)

ISSUE : WON petioner secured copyrights?

HELD:

Yes. The evidence on record, shows that petitioner secured the corresponding copyrights (Exhs. U and V)
for its books. These copyrights were found to be all right by the Copyright Office and petitioner was
always conceded to be the real owner thereof. It was on the strength of these facts that petitioner filed
the complaint against respondents. Through a proper search warrant (Exh. "M") obtained after
petitioner was convinced that respondents were selling spurious copies of its copyrighted books, the
books were seized from respondents and were identified to be spurious. In the face of these facts, it
cannot be said that the case is clearly an unfounded civil action or proceeding (par. 4. Art. 2208).
20th Century Fox Film v. Court of Appeals
I. THE FACTS

Petitioner 20th Century Fox Film Corporation sought the assistance of the NBI in conducting searches and
seizures in connection with the NBI’s anti-film piracy campaign. Petitioner alleged that certain videotape
outlets all over Metro Manila are engaged in the unauthorized sale and renting out of copyrighted films
in violation of PD No. 49 (the old Intellectual Property Law).

The NBI conducted surveillance and investigation of the outlets pinpointed by the petitioner and
subsequently filed three (3) applications for search warrants against the video outlets owned by the
private respondents. The lower court issued the desired search warrants. The NBI, accompanied by the
petitioner's agents, raided the video outlets and seized the items described in the three warrants.

Private respondents later filed a motion to lift the search warrants and release the seized properties,
which was granted by the lower court. Petitioner’s motion for reconsideration was denied by the lower
court. The CA affirmed the trial court.

II. THE ISSUE

Did the judge properly lift the search warrants he issued earlier?

III. THE RULING

[The Court DISMISSED the petition and AFFIRMED the questioned decision and resolution of the CA.]

YES, the judge properly lifted the search warrants he issued earlier.

The lower court lifted the three (3) questioned search warrants in the absence of probable cause that
the private respondents violated P.D. 49. NBI agents who acted as witnesses during the application for
search warrant did not have personal knowledge of the subject matter of their testimony, which was the
alleged commission of the offense of piracy by the private respondents. Only the petitioner’s counsel
who was also a witness during the application stated that he had personal knowledge that the
confiscated tapes owned by the private respondents were pirated tapes taken from master tapes
belonging to the petitioner. The lower court lifted the warrants, declaring that the testimony of
petitioner’s counsel did not have much credence because the master tapes of the allegedly pirated
tapes were not shown to the court during the application.

The presentation of the master tapes of the copyrighted films, from which the pirated films were
allegedly copied, was necessary for the validity of search warrants against those who have in their
possession the pirated films. The petitioner's argument to the effect that the presentation of the master
tapes at the time of application may not be necessary as these would be merely evidentiary in nature
and not determinative of whether or not a probable cause exists to justify the issuance of the search
warrants is not meritorious. The court cannot presume that duplicate or copied tapes were necessarily
reproduced from master tapes that it owns.

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.
UNITED FEATURE SYNDICATE, INC., petitioner, vs. MUNSINGWEAR CREATION
MANUFACTURING COMPANY, respondent.

Petitioner’s claim:
Petitioner is asking for the cancellation of the registration of trademark CHARLIE BROWN
(Registration No. SR. 4224) in the name of respondent MUNSINGWEAR, alleging that petitioner
is damaged by the registration of the trademark CHARLIE BROWN of T-Shirts under Class 25
with the Registration No. SR-4224 dated September 12, 1979 in the name of Munsingwear
Creation Manufacturing Co., Inc., on the following grounds: (1) that respondent was not entitled
to the registration of the mark CHARLIE BROWN, & DEVICE at the time of application for
registration; (2) that CHARLIE BROWN is a character creation or a pictorial illustration, the
copyright to which is exclusively owned worldwide by the petitioner; (3) that as the owner of the
pictorial illustration CHARLIE BROWN, petitioner has since 1950 and continuously up to the
present, used and reproduced the same to the exclusion of others; (4) that the respondent-
registrant has no bona fide use of the trademark in commerce in the Philippines prior to its
application for registration.
Respondent’s claim:
-It uses, the trademark "CHARLIE BROWN" & "DEVICE" on children's wear such as T-shirts,
undershirts, sweaters, brief and sandos, in class 25; whereas "CHARLIE BROWN" is used only
by petitioner as character, in a pictorial illustration used in a comic strip appearing in newspapers
and magazines. It has no trademark significance and therefore respondent-registrant's use of
"CHARLIE BROWN" & "DEVICE" is not in conflict with the petitioner's use of "CHARLIE BROWN"
-Relied on the ruling on October 2, 1984 in which the Director of the Philippine Patent Office
rendered a decision in this case 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.

Issue:WHETHER THE RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE

OF DISCRETION AMOUNTING TO EXCESS OF JURISDICTION WHEN BY DISMISSING THE
APPEAL TO IT FROM THE DECISION OF THE DIRECTOR OF PATENTS, IT KNOWINGLY
DISREGARDED ITS OWN DECISION IN AC-GR. SP. NO. 0342, WHICH WAS AFFIRMED BY
THIS HONORABLE SUPREME COURT TO THE EFFECT THAT A COPYRIGHTED
CHARACTER MAY NOT BE APPROPRIATED AS A TRADEMARK BY ANOTHER UNDER
PRESIDENTIAL DECREE NO. 49.

S.C. Ruling: The petitioner is impressed with merit.

Since the name "CHARLIE BROWN" and its pictorial representation were covered by a
copyright registration way back in 1950 the same are entitled to protection under PD No. 49,
otherwise known as the "Decree on Intellectual Property".

Aside from its copyright registration, petitioner is also the owner of several trademark
registrations and application for the name and likeness of "CHARLIE BROWN" which is the duly
registered trademark and copyright of petitioner United Feature Syndicate Inc. as early as 1957
and additionally also as TV SPECIALS featuring the "PEANUTS" characters "CHARLIE
BROWN”.

It is undeniable from the records that petitioner is the actual owner of said trademark due to its
prior registration with the Patent's Office.
COLUMBIA PICTURES INC. v CA [237 SCRA 367 (1994)]

Facts:
 07 April 1998: NBI filed with the RTC of Pasig 3 applications for SW against private respondent
(Tube Video Enterprises – Edward C. Cham; Blooming Rose Tape Center – Ma. Jajorie T. Uy; Video
Channel – Lydia Nabong) charging them with violations of Sec. 56 of PD 49 (Decree on the
Protection of Intellectual Property) as amended by PD 1988.
 RTC Judge Austria consolidated the 3 applications and conducted a joint hearing where she made
a personal examination of the applicant (NBI Agent Reyes) and his witnesses.
 Finding just and probable cause, Judge Austria issued the search warrants.
 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 been
recorded but the "sale, lease, or distribution of pirated video tapes of 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 sale,
lease or distribution of pirated tapes but also the transfer or causing to be transferred of
any sound recording or motion picture or other audio visual work.

But even assuming, as appellants argue, that only the sale, lease, or distribution of pirated
video tapes is involved, the fact remains that there is need to establish probable cause
that the tapes being sold, leased or distributed are pirated tapes, hence the issue reverts
back to the question of whether there was unauthorized transfer, directly or indirectly,
of a sound recording or motion picture or other audio visual work that has been recorded

Petitions denied.
Columbia Pictures vs CA (1996)

FACTS:
Columbia Pictures, et al. had lodged a formal complaint with the NBI, vis-à-vis their anti-film
piracy drive. Eventually, the NBI obtained a search warrant against Sunshine Video seeking
to seize pirated video tapes, among others. The NBI carried out the seizure, and filed a return
with the trial court. However, the trial court eventually granted a motion to lift the order of
search warrant – the contention was that the master tapes of the copyrighted films from
which the pirated films were allegedly copied were never presented in the proceedings for
the issuance of the search warrants. The CA dismissed the appeal brought before it. Hence,
Columbia Pictures, et al. brought the case before the SC. Sunshine Video contended that
Columbia Pictures, et al. (being foreign corporations doing business in the Philippines) should
have a license in order to maintain an action in Philippine courts – and without such license,
it had no right to ask for the issuance of a search warrant. Sunshine video submitted that the
fact that Columbia Pictures, et al. were copyright owners or owners of exclusive rights of
distribution in the Philippines of copyrighted motion pictures, AND the fact that Att. Domingo
had been appointed as their atty.-in-fact constituted “doing business in the Philippines”,
under the Rules of the Board of Investments.

ISSUE:
Do Colombia Pictures, et al. have legal personality to sue in the Philippines?

HELD:
YES. Under the Sec. 133 of the Corp. Code, no foreign corporation shall be permitted to
transact business in the Philippines, as this phrase is understood under the Corporation Code,
unless it shall have the license required by law, and until it complies with the law in transacting
business here, it shall not be permitted to maintain any suit in local courts. However, such
license is not necessary if it is not engaged in business in the Philippines. Any foreign
corporation not doing business in the Philippines may maintain an action in our courts upon
any cause of action, provided that the subject matter and the defendant are within the
jurisdiction of the court.

No general rule or governing principles can be laid down as to what constitutes "doing" or
"engaging in" or "transacting" business. The true tests, however, seem to be whether the
foreign corporation is continuing the body or substance of the business or enterprise for which
it was organized (as distinguished from merely casual, sporadic, or occasional transactions
and isolated acts) or whether it has substantially retired from it and turned it over to another.
Based on Article 133 of the Corporation Code and gauged by statutory standards, petitioners
are not barred from maintaining the present action. There is no showing that, under our
statutory or case law, petitioners are doing, transacting, engaging in or carrying on business
in the Philippines as would require obtention of a license before they can seek redress from
our courts. As a general rule, a foreign corporation will not be regarded as doing business in
the State simply because it enters into contracts with residents of the State, where such
contracts are consummated outside the State. It has moreover been held that the act of a
foreign corporation in engaging an attorney to represent it in a Federal court sitting in a
particular State is not doing business within the scope of the minimum contact test. The mere
institution and prosecution or defense of a suit, particularly if the transaction which is the basis
of the suit took place out of the State, do not amount to the doing of business in the State
Columbia Pictures Entertainment, Inc. vs Court of Appeals & Showtime
Enterprises

FACTS:
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.
Wilson Ong Ching Kian Chung vs China National Cereals Oil and Foodstuffs Import and
Export Corp.

Wilson Ong Ching Kian Chung is selling vermicelli (sotanghon) using his copyrighted
cellophane wrapper with the two-dragons designed label. In 1993, Wilson Ong sued Lorenzo
Tan for infringing upon his copyrighted cellophanes. Wilson Ong alleged that Tan was
importing sotanghon from China National Cereals Oils and Foodstuffs Import and Export
Corporation and then Tan would use Wilson Ong’s copyrighted cellophanes to sell the
sotanghon.
While the case was pending before the Quezon City RTC, China National Cereals filed
another complaint to cancel the copyright of Wilson Ong before the Manila RTC. Judge
Palattao of the Manila RTC issued a temporary restraining order enjoining Wilson Ong from
using his copyrighted cellophanes.
Eventually, Wilson Ong appealed before the Court of Appeals questioning the TRO. The
Court of Appeals in the body of its decision cited that the case before the Manila RTC should
have been dismissed because of litis pendentia and forum shopping, there being an existing
case before the QC RTC which is a co-equal court of the Manila RTC. But in the dispositive
portion of the CA decision, it said that the Manila RTC has the discretion to dismiss the case.
Manila RTC did not dismiss the case but rather it ordered the cancellation of Wilson Ong’s
copyright. The Manila RTC invoked that though the CA cited forum shopping and litis
pendentia as grounds for dismissing the case the CA did not order Manila RTC to actually
dismiss the case but rather it gave the Manila RTC the discretion to continue hearing the case.
ISSUE: Whether or not the Manila RTC is correct.
HELD: No. The general rule states that the dispositive portion of a Judgment becomes the
subject of execution. However, there are exceptions to this rule and one of the exceptions is
that if the dispositive portion differs with the discussion in the body of the decision such as in
the case at bar. This is because the dispositive portion finds support from the decision’s ratio
decidendi.
The Quezon City court and the Manila court have concurrent jurisdiction over the case.
However, when the Quezon City court acquired jurisdiction over the case, it excluded all other
courts of concurrent jurisdiction from acquiring jurisdiction over the same. The Manila court
is, therefore, devoid of jurisdiction over the complaint filed resulting in the assailed decision
which must perforce be declared null and void. To hold otherwise would be to risk instances
where courts of concurrent jurisdiction might have conflicting orders.
 Wilson Ong Ching Kian Chuan v CA

FACTS:
 Petitioner imports vermicelli from China National Cereals Oils and Foodstuffs, based in
Beijing, China, under the firm name C.K.C. Trading. He repacks it in cellophane wrappers with
a design of two-dragons and the TOWER trademark on the uppermost portion.
 Ong acquired a Certificate of Copyright Registration from the National Library on June 9,
1993 on the said design.
 Ong filed against Tan a verified complaint for infringement of copyright with damages and
prayer for temporary restraining order or writ of preliminary injunction with the RTC-QC.
o Ong alleged that he was the holder of a Certificate of Copyright Registration over the cellophane
wrapper with the two-dragon design, and that Tan used an identical wrapper in his business. In
his prayer for a preliminary injunction in addition to damages, he asked that Tan be restrained
from using the wrapper.
 Tan filed an opposition alleging that Ong was not entitled to an injunction.
o According to Tan, Ong did not have a clear right over the use of the trademark Pagoda and
Lungkow vermicelli as these were registered in the name of Ceroilfood Shandong, based in
Qingdao, China.
o Further, Tan averred that he was the exclusive distributor in the Philippines of the Pagoda and
Lungkow vermicelli and was solely authorized to use said trademark.
o He added that Ong merely copied the two-dragon design from Ceroilfood Shandong which had
the Certificates of Registration issued by different countries.
o Private respondent alleges that the trademark PAGODA BRAND was registered in China on
October 31, 1979 while the trademark LUNGKOW VERMICELLI WITH TWO-DRAGON
DEVICE was registered on August 15, 1985.
 Trial Court issued a temporary restraining order on the same date the complaint was filed. It
likewise issued the writ in Ong’s favor upon his filing of a P100,000.00 bond.
 CA gave due course and granted the petition. The lower court’s orders, as well as the writ of
preliminary injunction, were set aside. Ong filed a MR from which CA modified its decision and
made the injunction permanent.

ISSUE:
 W/N the issuance of the writ of preliminary injunction in favor of private respondent was
proper?

HELD: Petition is partially granted. The prayer for a writ of preliminary injunction to prohibit
Tan from using the cellophane wrapper with two-dragon device is denied, but the finding of the
respondent appellate court that Ong’s copyrighted wrapper is a copy of that of Ceroilfood
Shandong is SET ASIDE for being premature. Case was remanded to RTC.

RATIO:
 A person to be entitled to a copyright must be the original creator of the work. He
must have created it by his own skill, labor and judgment without directly copying or
 evasively imitating the work of another. The copies of the certificates of copyright registered
in the name of Ceroilfood Shandong sufficiently raise reasonable doubt. With such a doubt, the
preliminary injunction asked by Ong against Tan is unavailing.
 To be entitled to an injunctive writ, petitioner must show, inter alia, the existence of a clear
and unmistakable right and an urgent and paramount necessity for the writ to prevent serious
damage. In this case, the Court found that petitioner’s right has not been clearly and
unmistakably demonstrated.
 The Court added it was premature for the CA to declare that the design of petitioner’s
wrapper is a copy of the wrapper allegedly registered by Ceroilfood Shandong. The only issue
brought before the CA involved the grave abuse of discretion allegedly committed by the trial
court in granting the writ of preliminary injunction, and not on the merits of the infringement
case. That matter remains for decision after appropriate proceedings at the trial court.
MICROSOFT CORPORATION and LOTUS DEVELOPMENT CORPORATION, petitioners,
vs.
MAXICORP, INC., respondent.

FACTS OF THE CASE:

This case involves the issuance of search warrant to the respondent MAXICORP Inc for alleged violation of Section
29 of Intellectual Property and Article 189 of the RPC (unfair competition).

Armed with the search warrants, NBI agents conducted a search of Maxicorp’s premises and seized property fitting
the description stated in the search warrants.

Maxicorp filed a motion to quash the search warrants alleging that there was no probable cause for their issuance
and that the warrants are in the form of "general warrants." Where the RTC denied the motion and at the same time
denied their motion for reconsideration.

According to RTC they’ve found a probable cause to issue such warrant after examining the NBI agent and the
computer technician who visited Maxicorp.

Maxicorp filed a petition for certiorari with the Court of Appeals seeking to set aside the RTC’s order. The Court of
Appeals reversed the RTC’s order denying Maxicorp’s motion to quash the search warrants. Petitioners moved for
reconsideration. The Court of Appeals denied petitioners’ motion on 29 November 1999.

The Court of Appeals held that NBI Agent Samiano failed to present during the preliminary examination conclusive
evidence that Maxicorp produced or sold the counterfeit products. The Court of Appeals pointed out that the sales
receipt NBI Agent Samiano presented as evidence that he bought the products from Maxicorp was in the name of a
certain "Joel Diaz."

Hence, this petition.

ISSUE/S:

1. Whether or not there’s a probable cause on the part of CA to quash the search warrants issued by RTC
2. Whether or not respondent violated the intellectual property right of the petitioner.

RULING:

According to the SC the offense charged against Maxicorp is copyright infringement under Section 29 of PD 49 and
unfair competition under Article 189 of the RPC. To support these charges, petitioners presented the testimonies of
NBI Agent Samiano, computer technician Pante, and Sacriz, a civilian. The offenses that petitioners charged Maxicorp
contemplate several overt acts. The sale of counterfeit products is but one of these acts. Both NBI Agent Samiano
and Sacriz related to the RTC how they personally saw Maxicorp commit acts of infringement and unfair competition.

Probable cause means "such reasons, supported by facts and circumstances as will warrant a cautious man in the
belief that his action and the means taken in prosecuting it are legally just and proper."Thus, probable cause for a
search warrant requires such facts and circumstances that would lead a reasonably prudent man to believe that an
offense has been committed and the objects sought in connection with that offense are in the place to be searched.
The testimonies of these two witnesses, coupled with the object and documentary evidence they presented, are
sufficient to establish the existence of probable cause. From what they have witnessed, there is reason to believe
that Maxicorp engaged in copyright infringement and unfair competition to the prejudice of petitioners. Both NBI
Agent Samiano and Sacriz were clear and insistent that the counterfeit software were not only displayed and sold
within Maxicorp’s premises, they were also produced, packaged and in some cases, installed there.

The determination of probable cause does not call for the application of rules and standards of proof that a judgment
of conviction requires after trial on the merits. As implied by the words themselves, "probable cause" is concerned
with probability, not absolute or even moral certainty. The prosecution need not present at this stage proof beyond
reasonable doubt. The standards of judgment are those of a reasonably prudent man, 24 not the exacting calibrations
of a judge after a full-blown trial.

No law or rule states that probable cause requires a specific kind of evidence. No formula or fixed rule for its
determination exists.25 Probable cause is determined in the light of conditions obtaining in a given situation. 26 Thus,
it was improper for the Court of Appeals to reverse the RTC’s findings simply because the sales receipt evidencing
NBI Agent Samiano’s purchase of counterfeit goods is not in his name.

For purposes of determining probable cause, the sales receipt is not the only proof that the sale of petitioners’
software occurred. During the search warrant application proceedings, NBI Agent Samiano presented to the judge
the computer unit that he purchased from Maxicorp, in which computer unit Maxicorp had pre-installed
petitioners’ software.

The Supreme Court held:

“xxx No provision of the law exists which requires that a warrant, partially defective in specifying some items
sought to be seized yet particular with respect to the other items, should be nullified as a whole. A partially
defective warrant remains valid as to the items specifically described in the warrant. A search warrant is severable,
the items not sufficiently described may be cut off without destroying the whole warrant.”

In addition the Highest Court stated:

“xxx The exclusionary rule found in Section 3(2) of Article III of the constitution renders inadmissible in any
proceeding all evidence obtained through unreasonable searches and seizures. Thus, all items seized under
paragraph © after search warrants, not falling under paragraphs a, b, c, d, e, f, should be returned to Maxico
Sony Music Entertainment vs. Judge Español

Facts:

Sony Music Entertainment is suing Judge Dolores Español nullifying the Petition for Certiorari
with application for injunctive relief and then denying reconsideration of the said petition.

From the said petition, the respondents were private namely James Uy, David Chung, Elena
Lim and another officer of respondent Solid Laguna Corporation with violation were engaged in
the replication, reproduction and distribution of videograms without license and authority from
VRB. On Account of this and petitioner's own complaints for copyright infringement. The
National Bureau Investigation, through Agent Ferdinand Lavin, presided by Judge Español, for
the issuance of search warrants against private respondents doing business under the name
and style “Media Group” inside the factory and production facility of SLC.

Agent Lavin and the witnesses conduct an investigation, in the course of which unnamed
persons informed them that allegedly infringing or pirated discs were being manufactured
somewhere in an industrial park in Laguna. The respondents prove before the Department of
Justice that they were licensed by VRB up to the time of search. DOJ dismissed VRB's
complaint. Respondents issued Quash Search Warrants.

Issue:

Whether or not Judge Español committed a grave abuse of her discretion regarding the case.

Rulings:

No. Case, in fact, is lacking of evidence to prove that the respondents of the case were not
authorized reproducers of videograms. The fact that Agent Lavin do not have actual knowledge
about the cd he purchased was illegally reproduced, thus, he just have learned it from unnamed
person. The fact that the respondenmts do have a license form VRB made them an authorized
replicator and distributor of videograms.

The issuance of search warrant predicated on the sworn testimonies of persons without
personal knowledge of fact they were testifying on and who relied on a false certification issued
by VRB. Based as it were on hearsay and false information, its issuance was without probable
cause and therefore invalid. The decision was fair and the Judge did not abuse her discretion.
NBI-Microsoft vs Judy Hwang

Intellectual Property – Law on Copyright – Probable Cause in Issuing Search Warrant

In 1996, Dominador Samiano, an agent of the National Bureau of Investigation (NBI) conducted a
surveillance against Maxicorp Inc. He observed that Microsoft Software (Windows Operating Systems)
were being produced and packaged within the premises of Maxicorp. Samiano, together with a civilian
witness (John Benedict Sacriz) then bought a computer unit from Maxicorp. The unit was pre-installed with
a pirated copy of Windows. For their purchase, they were issued a receipt, however, the receipt was in the
name of a certain “Joel Diaz”. Subsequently, Samiano applied for a search warrant before the RTC. He
brought with him Sacriz as witness. He also brought the computer unit they bought as evidence as well as
the receipt. He even added an additional witness (Felixberto Pante), a computer technician, who showed
the judge that the software in the computer unit bought by Samiano from Maxicorp was pirated. The RTC
judge, convinced that there is a probable cause for a case of copyright infringement and unfair competition
committed by Maxicorp, issued the corresponding warrant. Maxicorp assailed the legality of the warrant
before the Court of Appeals. The Court of Appeals ruled in favor of Maxicorp and in its decision it highlighted
the fact that the receipt issued was not in Samiano’s or Sacriz’ name hence the proceeding in the trial court
was infirm from the onset.

ISSUE: Whether or not the Court of Appeals is correct.

HELD: No. The testimonies of the two witnesses, coupled with the object and documentary evidence they
presented, are sufficient to establish the existence of probable cause. From what they have witnessed,
there is reason to believe that Maxicorp engaged in copyright infringement and unfair competition to the
prejudice of Microsoft. Both NBI Agent Samiano and Sacriz were clear and insistent that the counterfeit
software were not only displayed and sold within Maxicorp’s premises, they were also produced, packaged
and in some cases, installed there.
The fact that the receipt issued was not in Samiano’s name nor was it in Sacriz’ name does not render the
issuance of the warrant void. No law or rule states that probable cause requires a specific kind of evidence.
No formula or fixed rule for its determination exists. Probable cause is determined in the light of conditions
obtaining in a given situation.Thus, it was improper for the Court of Appeals to reverse the RTC’s findings
simply because the sales receipt evidencing NBI Agent Samiano’s purchase of counterfeit goods is not in
his name.
PEOPLE V CHOI

GR 152950

August 3, 2006

Facts:

 Mario Nieto, an intelligence operative of the Department of Finance, applied for a search warrant against
Choi for violation of the Intellectual Property Code. (fake Marlboro red cigarettes and cardboard cases)
 After examination of the applicant and the witnesses, the judge issued the search warrant. Search was
conducted the same day.
 Choi questioned the validity of the search warrant before the RTC and the CA, arguing that probable cause
was not sufficiently established because the examination conducted was not probing and exhaustive.
Moreover, the warrant did not particularly describe the place to be searched.
 CA ruled that the judge committed GADLEJ in relying upon the conclusion of the witness that the cigarettes
he received from Choi were fake, without requiring the presentation of the alleged fake cigarettes and
genuine ones for comparison.

Issue:

 Whether or not the trial court erred in issuing a search warrant

Ruling:

 No. A search warrant can be issued upon a finding of probable cause.

 Probable cause for a search has been defined as such facts and circumstances which would lead a
reasonably discreet and prudent man to believe that an offense has been committed and that the
objects sought in connection with the offense are in the place sought to be searched.
 In determining the existence of probable cause, it is required that:
o The judge must examine the complaint and his witnesses personally
o The examination must be under oath
o The examination must be reduced in writing in the form of searching questions and answers
 Although there is no hard and fast rule governing how a judge should conduct his examination, it is
necessary that the examination must be probing and exhaustive, not merely routinary, general, peripheral,
perfunctory, or pro forma. The judge must not simply rehash the contents of the affidavit but make his own
inquiry on the intent and justification of the application.
 The determination of probable cause does not call for the application of rules and standards of proof that
a judgment of conviction requires after trial on the merits. Probable cause is concerned with probability,
not absolute or even moral certainty. The standards of judgment are those of a reasonably prudent man,
not the exacting calibrations of a judge after full-blown trial.
 The questions of the judge during the examination in this case were sufficiently probing, and not at all
superficial and perfunctory. The testimonies were consistent with each other, and the narration of facts
was credible. The testimonies and other evidence on record constituted adequate bases to establish
probable cause that the alleged offense has been committed.
 Since probable cause is dependent largely on the opinion and findings of the judge, the findings of the judge
deserve great weight, and may only be overturned when there is clear disregard of the facts before him
and dictates of reason, which is not present in this case.
SANRIO COMPANY LIMITED V. LIM (G.R.
NO. 168662)
Facts:
Petitioner Sanrio Company, a Japanese corporation, is the copyright owner of various animated
characters sold locally by its exclusive distributor, Gift Gate Incorporated, which allowed local
entities to manufacture petitioner’s products. A search warrant was issued against respondent Lim
alleged to be selling imitations of petitioner’s products. Thereafter, petitioner filed a complaint for
copyright infringement with the Task-Force on Anti-Intellectual Property Piracy (TAPP) of the
DOJ. Respondent asserted that he obtained his merchandise from petitioner’s authorized
manufacturers. The complaint was dismissed. CA affirmed and further held that the offense had
already prescribed.

Issues:
(1) Whether or not the action had prescribed.
(2) Whether or not there is copyright infringement.

Ruling:
(1) NO. Section 2 of Act 3326 provides that the prescriptive period for violation of special laws
starts on the day such offense was committed and is interrupted by the institution of proceedings
against respondent (i.e., the accused). Petitioner in this instance filed its complaint-affidavit 1 year,
10 months and 4 days after the NBI searched respondent’s premises and seized Sanrio merchandise
therefrom. Although no information was immediately filed in court, respondent’s alleged violation
had not yet prescribed. In the recent case of Brillantes v. Court of Appeals, we affirmed that the
filing of the complaint for purposes of preliminary investigation interrupts the period of
prescription of criminal responsibility. Thus, the prescriptive period for the prosecution of the
alleged violation of the IPC was tolled by petitioner’s timely filing of the complaint-affidavit
before the TAPP.
(2) NO. To be criminally liable for violation of Section 217.3 of the IPC, the following requisites
must be present:
1. possession of the infringing copy and
2. knowledge or suspicion that the copy is an infringement of the genuine article.
The prosecutors in this case consistently found that no probable cause existed against respondent
for violation of the IPC. The TAPP found that: Evidence on record would show that respondent
bought his merchandise from legitimate sources. While it appears that some of the items seized
during the search are not among those products which [GGI] authorized these establishments to
produce, the fact remains that respondent bought these from the abovecited legitimate sources. At
this juncture, it bears stressing that respondent relied on the representations of these manufacturers
and distributors that the items they sold were genuine. As such, it is not incumbent upon respondent
to verify from these sources what items [GGI] only authorized them to produce. Thus, as far as
respondent is concerned, the items in his possession are not infringing copies of the original
[petitioner’s] products.