G.R. No.
166391, October 21, 2015
MICROSOFT CORPORATION, Petitioner, v. ROLANDO D. MANANSALA AND/OR MEL
MANANSALA, DOING BUSINESS AS DATAMAN TRADING COMPANY AND/OR COMIC
ALLEY, Respondent.
DECISION
BERSAMIN, J.:
This appeal seeks to overturn the decision promulgated on February 27, 2004,1 whereby
the Court of Appeals (CA) dismissed the petition for certiorari filed by petitioner to annul
the orders of the Department of Justice (DOJ) dated March 20, 2000,2 May 15,
2001,3 and January 27, 20034 dismissing the criminal charge of violation of Section 29 of
Presidential Decree No. 49 (Decree on Intellectual Property) it had instituted against the
respondents; and the resolution promulgated on December 6, 2004 denying its motion
for reconsideration.5
Antecedents
The CA summarized the factual and procedural antecedents thusly:
Petitioner (Microsoft Corporation) is the copyright and trademark owner of all rights
relating to all versions and editions of Microsoft software (computer programs) such as,
but not limited to, MS-DOS (disk operating system), Microsoft Encarta, Microsoft
Windows, Microsoft Word, Microsoft Excel, Microsoft Access, Microsoft Works,
Microsoft Powerpoint, Microsoft Office, Microsoft Flight Simulator and Microsoft
FoxPro, among others, and their user's guide/manuals.
Private Respondent-Rolando Manansala is doing business under the name of DATAMAN
TRADING COMPANY and/or COMIC ALLEY with business address at 3rd Floor, University
Mall Building, Tail Avc, Manila.
Private Respondent Manansala, without authority from petitioner, was engaged in
distributing and selling Microsoft computer software programs.
On November 3, 1997, Mr. John Benedict A. Sacriz, a private investigator accompanied
by an agent from the National Bureau of Investigation (NBI) was able to purchase six (6)
CD-ROMs containing various computer programs belonging to petitioner.
As a result of the test-purchase, the agent from the NBI applied for a search warrant to
search the premises of the private respondent.
On November 17, 1997, a Search Warrant was issued against the premises of the private
respondent.
On November 19, 1997, the search warrant was served on the private respondent's
premises and yielded several illegal copies of Microsoft programs.
Subsequently, petitioner, through Atty. Teodoro Kalaw IV tiled an Affidavit-Complaint in
the DOJ based on the results of the search and seizure operation conducted on private
respondent's premises.
However, in a Resolution dated March 20, 2000, public respondent State Prosecutor
dismissed the charge against private respondent for violation of Section 29 P.D. 49 in
this wise, to quote:
'The evidence is extant in the records to show that respondent is selling Microsoft
computer software programs bearing the copyrights and trademarks owned by
Microsoft Corporation. There is, however, no proof that respondent was the one who
really printed or copied the products of complainant for sale in his store.
WHEREFORE, it is hereby, recommended that respondent be charged for violation of
Article 189 of the Revised Penal Code. The charge for violation of Section 29 of PD No.
49 is recommended dismissed for lack of evidence.'
Petitioner filed a Motion for Partial Reconsideration arguing that printing or copying is
not essential in the crime of copyright infringement under Section 29 of PD No. 49.
On May 15, 2001, the public respondent issued a Resolution denying the Motion for
Partial Reconsideration.
Thereafter, petitioner filed a Petition for Review with the DOJ, which denied the petition
for review.6ChanRoblesVirtualawlibrary
Dissatisfied with the outcome of its appeal, the petitioner filed its petition
for certiorari in the CA to annul the DOJ's dismissal of its petition for review on the
ground of grave abuse of discretion amounting to lack or excess of jurisdiction on the
part of the DOJ.
On February 27, 2004, the CA rendered the assailed decision affirming the dismissal by
the DOJ,7disposing as follows:
WHEREFORE, premises considered, the instant petition is DENIED. Consequently, the
Orders dated March 20, 2000, May 15, 2001 and January 27, 2003 respectively are
hereby AFFIRMED.
SO ORDERED.8ChanRoblesVirtualawlibrary
Issue
The petitioner insists that printing or copying was not essential in the commission of the
crime of copyright infringement under Section 29 of Presidential Decree No. 49; hence,
contrary to the holding of the DOJ, as upheld by the CA, the mere selling of pirated
computer software constituted copyright infringement.9
Ruling of the Court
The appeal is meritorious.
Although the general rule is that the determination of the existence of probable cause
by the public prosecutor is not to be judicially scrutinized because it is an executive
function, an exception exists when the determination is tainted with grave abuse of
discretion.10 Bearing this in mind, we hold that the DOJ committed grave abuse of
discretion in sustaining the public prosecutor's dismissal of the charge of copyright
infringement under Section 29 of Presidential Decree No. 49 on the ground of lack of
evidence because the public prosecutor thereby flagrantly disregarded the existence of
acts sufficient to engender the well-founded belief that the crime of copyright
infringement had been committed, and that the respondent was probably guilty
thereof.11
Section 5 of Presidential Decree No. 49 specifically defined copyright as an exclusive
right in the following manner:
Section 5. Copyright shall consist in the exclusive right;
(A) To print, reprint, publish, copy, distribute, multiply, sell, and make photographs,
photo-engravings, and pictorial illustrations of the works;
(B) To make any translation or other version or extracts or arrangements or adaptations
thereof; to dramatize it if it be a non-dramatic work; to convert it into a non-dramatic
work if it be a drama; to complete or execute if it be a model or design;
(C) To exhibit, perform, represent, produce, or reproduce, the work in any manner or by
any method whatever for profit or otherwise; it not reproduced in copies for sale, to sell
any manuscript or any record whatsoever thereof;
(D) To make any other use or disposition of the work consistent with the laws of the
land.
Accordingly, the commission of any of the acts mentioned in Section 5 of Presidential
Decree No. 49 without the copyright owner's consent constituted actionable copyright
infringement. In Columbia Pictures, Inc. v. Court of Appeals,12 the Court has emphatically
declared:
Infringement of a copyright is a trespass on a private domain owned and occupied by
the owner of the copyright, and, therefore, protected by law, and infringement of
copyright, or piracy, which is a synonymous term in this connection, consists in the
doing by any person, without the consent of the owner of the copyright, of anything the
sole right to do which is conferred by statute on the owner of the copyright.
The "gravamen of copyright infringement," according to NBI-Microsoft Corporation v.
Hwang:13
is not merely the unauthorized manufacturing of intellectual works but rather the
unauthorized performance of any of the acts covered by Section 5. Hence, any person
who performs any of the acts under Section 5 without obtaining the copyright owners
prior consent renders himself civilly and criminally liable for copyright
infringement.14ChanRoblesVirtualawlibrary
The CA stated in the assailed decision as follows:
A reading of Section 5 (a) of the Copyright Law shows that the acts enumerated therein
are punctuated by commas and the last phrase is conjoined by the words 'and'. Clearly,
the same should be interpreted to mean as 'relating to one another' because it is basic
in legal hermeneutics that the word 'and' is not meant to separate words but is a
conjunction used to denote a 'joinder' or 'union'.
In the book of Noli C. Diaz entitled as STATUTORY CONSTRUCTION, the word 'and' was
defined as a 'conjunction connecting words or phrases expressing the idea that the
latter is to be added to or taken along with the first'. Stated differently, the word 'and' is
a conjunction pertinently defined as meaning 'together with', 'joined with', 'along or
together with', 'added to or linked to' used to conjoin 'word with word', 'phrase with
phrase', 'clause with clause'. The word 'and' does not mean 'or', it is a conjunction used
to denote a joinder or union, 'binding together', relating the one to the other.

Hence the key to interpret and understand Section 5 (a) of P.D. 49 is the word 'and'.
From the foregoing definitions of the word 'and' it is unmistakable that to hold a person
liable under the said provision of law, all the acts enumerated therein must be present
and proven. As such, it is not correct to construe the acts enumerated therein as being
separate or independent from one another.
In the case at bar, petitioner failed to allege and adduce evidence showing that the
private respondent is the one who copied, replicated or reproduced the software
programs of the petitioner. In other words, 'sale' alone of pirated copies of Microsoft
software programs does not constitute copyright infringement punishable under P.D.
49.15ChanRoblesVirtualawlibrary
The CA erred in its reading and interpretation of Section 5 of Presidential Decree No. 49.
Under the rules on syntax, the conjunctive word "and" denotes a "joinder or union" of
words, phrases, or clause;16 it is different from the disjunctive word "or" that signals
disassociation or independence.17 However, a more important rule of statutory
construction dictates that laws should be construed in a manner that avoids absurdity or
unreasonableness.18 As the Court pointed out in Automotive Parts & Equipment
Company, Inc. v. Lingad:19
Nothing is better settled then that courts are not to give words a meaning which would
lead to absurd or unreasonable consequence. That is a principle that goes back to In re
Allen decided on October 29, 1903, where it was held that a literal interpretation is to
be rejected if it would be unjust or lead to absurd results. That is a strong argument
against its adoption. The words of Justice Laurel are particularly apt. Thus: 'The fact that
the construction placed upon the statute by the appellants would lead to an absurdity is
another argument for rejecting it x x x.'
It is of the essence of judicial duty to construe statutes so as to avoid such a deplorable
result. That has long been a judicial function. A literal reading of a legislative act which
could be thus characterized is to be avoided if the language thereof can be given a
reasonable application consistent with the legislative purpose. In the apt language of
Frankfurter: A decent respect for the policy of Congress must save us from imputing to it
a self-defeating, if not disingenuous purpose. Certainly, we must reject a construction
that at best amounts to a manifestation of verbal ingenuity but hardly satisfies the test
of rationality on which law must be based.20ChanRoblesVirtualawlibrary
The conjunctive "and" should not be taken in its ordinary acceptation, but should be
construed like the disjunctive "or" if the literal interpretation of the law would pervert
or obscure the legislative intent.21 To accept the CA's reading and interpretation is to
accept absurd results because the violations listed in Section 5(a) of Presidential Decree
No. 49 - "To print, reprint, publish, copy, distribute, multiply, sell, and make
photographs, photo-engravings, and pictorial illustrations of the works" — cannot be
carried out on all of the classes of works enumerated in Section 2 of Presidential Decree
No. 49, viz.:
Section 2. - The Rights granted by this Decree shall, from the moment of creation,
subsist with respect to any of the following classes of works:chanRoblesvirtualLawlibrary
(A) Books, including composite and encyclopedic works, manuscripts, directories, and
gazetteers;
(B) Periodicals, including pamphlets and newspapers;
(C) Lectures, sermons, addresses, dissertations prepared for oral delivery;
(D) Letters;
(E) Dramatic or dramatico-musical compositions; choreographic works and
entertainments in dumb shows, the acting form of which is fixed in writing or otherwise;
(F) Musical compositions, with or without words;
(G) Works of drawing, painting, architecture, sculpture, engraving, lithography, and
other works of art; models or designs for works of art;
(H) Reproductions of a work of art;
(I) Original ornamental designs or models for articles of manufacture, whether or not
patentable, and other works of applied art;
(J) Maps, plans, sketches, and charts;
(K) Drawings, or plastic works of a scientific or technical character;
(L) Photographic works and works produced by a process analogous to photography;
lantern slides;
(M) Cinematographic works and works produced by a process analogous to
cinematography or any process for making audio-visual recordings;
(N) Computer programs;
(O) Prints, pictorial, illustration, advertising copies, labels, tags, and box wraps; SO ORDERED.

(P) Dramatization, translations, adaptations, abridgements, arrangements and other

alterations of literary, musical or artistic works or of works of the Philippine Government
as herein defined, which shall be protected as provided in Section 8 of this Decree.

(Q) Collection of literary, scholarly, or artistic works or of works referred to in Section 9

of this Decree which by reason of the selection and arrangement of their contents
constitute intellectual creations, the same to be protected as such in accordance with
Section 8 of this Decree.

(R) Other literary, scholarly, scientific and artistic works.

Presidential Decree No. 49 thereby already acknowledged the existence of computer

programs as works or creations protected by copyright.22 To hold, as the CA incorrectly
did, that the legislative intent was to require that the computer programs be first
photographed, photo-engraved, or pictorially illustrated as a condition for the
commission of copyright infringement invites ridicule. Such interpretation of Section
5(a) of Presidential Decree No. 49 defied logic and common sense because it focused on
terms like "copy," "multiply," and "sell," but blatantly ignored terms like "photographs,"
"photo-engravings," and "pictorial illustrations." Had the CA taken the latter words into
proper account, it would have quickly seen the absurdity of its interpretation.

The mere sale of the illicit copies of the software programs was enough by itself to show
the existence of probable cause for copyright infringement. There was no need for the
petitioner to still prove who copied, replicated or reproduced the software programs.
Indeed, the public prosecutor and the DOJ gravely abused their discretion in dismissing
the petitioner's charge for copyright infringement against the respondents for lack of
evidence. There was grave abuse of discretion because the public prosecutor and the
DOJ acted whimsically or arbitrarily in disregarding the settled jurisprudential rules on
finding the existence of probable cause to charge the offender in court. Accordingly, the
CA erred in upholding the dismissal by the DOJ of the petitioner's petition for review.
We reverse.

WHEREFORE, the Court GRANTS the petition for review

on certiorari; REVERSES and SETS ASIDE the decision promulgated on February 27, 2004
in C.A.-G.R. SP No. 76402; DIRECTS the Department of Justice to render the proper
resolution to charge respondent ROLANDO D. MANANSALA and/or MEL MANANSALA,
doing business as DATAMAN TRADING COMPANY and/or COMIC ALLEY in accordance
with this decision; and ORDERS the respondents to pay the costs of suit.
G.R. No. 195835, March 14, 2016
SISON OLAÑO, SERGIO T. ONG, MARILYN O. GO, AND JAP FUK HAI, Petitioners, v. LIM
ENG CO, Respondent.
DECISION
REYES, J.:
This is a petition for review on certiorari1 under Rule 45 of the Rules of Court, assailing
the Decision2dated July 9, 2010 and Resolution3 dated February 24, 2011 of the Court of
Appeals (CA) in CA-G.R. SP No. 95471, which annulled the Resolutions dated March 10,
20064 and May 25, 20065 of the Department of Justice (DOJ) in I.S. No. 2004-925, finding
no probable cause for copyright infringement against Sison Olano, Sergio Ong, Marilyn
Go and Jap Fuk Hai (petitioners) and directing the withdrawal of the criminal
information filed against them.
The Antecedents
The petitioners are the officers and/or directors of Metrotech Steel Industries, Inc.
(Metrotech).6 Lim Eng Co (respondent), on the other hand, is the Chairman of LEC Steel
Manufacturing Corporation (LEC), a company which specializes in architectural metal
manufacturing.7
Sometime in 2002, LEC was invited by the architects of the Manansala Project (Project),
a high-end residential building in Rockwell Center, Makati City, to submit
design/drawings and specifications for interior and exterior hatch doors. LEC complied
by submitting on July 16, 2002, shop plans/drawings, including the diskette therefor,
embodying the designs and specifications required for the metal hatch doors.8
After a series of consultations and revisions, the final shop plans/drawings were
submitted by LEC on January 15, 2004 and thereafter copied and transferred to the title
block of Ski-First Balfour Joint Venture (SKI-FB), the Project's contractor, and then
stamped approved for construction on February 3, 2004.9
LEC was thereafter subcontracted by SKI-FB, to manufacture and install interior and
exterior hatch doors for the 7th to 22nd floors of the Project based on the final shop
plans/drawings.10
Sometime thereafter, LEC learned that Metrotech was also subcontracted to install
interior and exterior hatch doors for the Project's 23rd to 41st floors.11
On June 24, 2004, LEC demanded Metrotech to cease from infringing its intellectual
property rights. Metrotech, however, insisted that no copyright infringement was
committed because the hatch doors it manufactured were patterned in accordance with
the drawings provided by SKI-FB.12
On July 2, 2004, LEC deposited with the National Library the final shop plans/drawings of
the designs and specifications for the interior and exterior hatch doors of the
Project.13 On July 6, 2004, LEC was issued a Certificate of Copyright Registration and
Deposit showing that it is the registered owner of plans/drawings for interior and
exterior hatch doors under Registration Nos. 1-2004-13 and 1-2004-14,
respectively.14This copyright pertains to class work "I" under Section 172 of Republic Act
(R.A.) No. 8293, The Intellectual Property Code of the Philippines, which covers
"illustrations, maps, plans, sketches, charts and three-dimensional works relative to
geography, topography, architecture or science."
On December 9, 2004, LEC was issued another Certificate of Copyright Registration and
Deposit showing that it is the registered owner of plans/drawings for interior and
exterior hatch doors under Registration Nos. H-2004-566 and H-2004-56715 which is
classified under Section 172(h) of R.A. No. 8293 as "original ornamental designs or
models for articles of manufacture, whether or not registrable as an industrial design,
and other works of applied art."
When Metrotech still refused to stop fabricating hatch doors based on LEC's shop
plans/drawings, the latter sought the assistance of the National Bureau of Investigation
(NBI) which in turn applied for a search warrant before the Regional Trial Court (RTC) of
Quezon City, Branch 24. The application was granted on August 13, 2004 thus resulting
in the confiscation of finished and unfinished metal hatch doors as well as machines
used in fabricating and manufacturing hatch doors from the premises of Metrotech.16
On August 13, 2004, the respondent filed a Complaint-Affidavit17 before the DOJ against
the petitioners for copyright infringement. In the meantime or on September 8, 2004,
the RTC quashed the search warrant on the ground that copyright infringement was not
established.18
Traversing the complaint, the petitioners admitted manufacturing hatch doors for the
Project. They denied, however, that they committed copyright infringement and averred
that the hatch doors they manufactured were functional inventions that are proper
subjects of patents and that the records of the Intellectual Property Office reveal that
there is no patent, industrial design or utility model registration on LEC's hatch doors.
Metrotech further argued that the manufacturing of hatch doors per se is not copyright
infringement because copyright protection does not extend to the objects depicted in
the illustrations and plans. Moreover, there is no artistic or ornamental expression
embodied in the subject hatch doors that would subject them to copyright protection.19
Resolutions of the DOJ
In a Resolution20 dated August 18, 2005, the investigating prosecutor dismissed the
respondent's complaint based on inadequate evidence showing that: (1) the petitioners
committed the prohibited acts under Section 177 of R.A. No. 8293; and (2) the interior
and exterior hatch doors of the petitioners are among the classes of copyrightable work
enumerated in Sections 172 and 173 of the same law.21
Adamant, the respondent filed a petition for review before the DOJ but it was also
denied due course in the Resolution22 dated November 16, 2005.
Upon the respondent's motion for reconsideration, however, the Resolution23 dated
January 27, 2006 of the DOJ reversed and set aside the Resolution dated August 18,
2005 and directed the Chief State Prosecutor to file the appropriate information for
copyright infringement against the petitioners.24 The DOJ reasoned that the pieces of
evidence adduced show that the subject hatch doors are artistic or ornamental with
distinctive hinges, door and jamb, among others. The petitioners were not able to
sufficiently rebut these allegations and merely insisted on the non-artistic nature of the
hatch doors. The DOJ further held that probable cause was established insofar as the
artistic nature of the hatch doors and based thereon the act of the petitioners in
manufacturing or causing to manufacture hatch doors similar to those of the
respondent can be considered as unauthorized reproduction; hence, copyright
infringement under Section 177.1 in relation to Section 216 of R.A. No. 8293.25cralawred
Aggrieved, the petitioners moved for reconsideration. This time, the DOJ made a
complete turn around by granting the motion, vacating its Resolution dated January 27,
2006 and declaring that the evidence on record did not establish probable cause
because the subject hatch doors were plainly metal doors with functional components
devoid of any aesthetic or artistic features. Accordingly, the DOJ Resolution26dated
March 10, 2006 disposed as follows:
chanRoblesvirtualLawlibrary
WHEREFORE, finding cogent reason to reverse the assailed resolution, the motion for
reconsideration is GRANTED finding no probable cause against the [petitioners].
Consequently, the City Prosecutor of Manila is hereby directed to cause the withdrawal
of the information, if any has been filed in court, and to report the action taken thereon
within TEN (10) DAYS from receipt hereof.
SO ORDERED.27ChanRoblesVirtualawlibrary
The respondent thereafter filed a motion for reconsideration of the foregoing resolution
but it was denied28 on May 25, 2006. The respondent then sought recourse before the
CA via a petition for certiorari29 ascribing grave abuse of discretion on the part of the
DOJ.
In its assailed Decision30 dated July 9, 2010, the CA granted the petition. The CA held
that the vacillating findings of the DOJ on the presence or lack of probable cause
manifest capricious and arbitrary exercise of discretion especially since its opposite
findings were based on the same factual evidence and arguments.
The CA then proceeded to make its own finding of probable cause and held that:
chanRoblesvirtualLawlibrary
[F]or probable cause for copyright infringement to exist, essentially, it must be shown
that the violator reproduced the works without the consent of the owner of the
copyright.
In the present case before Us, [the petitioners] do not dispute that: (1) LEG was issued
copyrights for the illustrations of the hatch doors under Section 171.i, and for the hatch
doors themselves as ornamental design or model for articles of manufacture pursuant
to Section 171.h of R.A. [No.] 8293; and (2) they manufactured hatch doors based on
drawings and design furnished by SKI-FB, which consists of LEC works subject of
copyrights. These two (2) circumstances, taken together, are sufficient to excite the
belief in a reasonable mind that [the petitioners] are probably guilty of copyright
infringement. First, LEC has indubitably established that it is the owner of the copyright
for both the illustrations of the hatch doors and [the] hatch doors themselves, and
second, [the petitioners] manufactured hatch doors based on LEC's works, sans EEC's
consent.
xxxx
[T]he fact that LEC enjoys ownership of copyright not only on the illustrations of the
hatch doors but on the hatch doors itself and that [the petitioners] manufactured the
same is sufficient to warrant a finding of probable cause for copyright infringement. x x
x.31ChanRoblesVirtualawlibrary
The CA further ruled that any allegation on the non-existence of ornamental or artistic
values on the hatch doors are matters of evidence which are best ventilated in a full-
blown trial rather than during the preliminary investigation stage. Accordingly, the CA
disposed as follows: the registered copyright owner or automatically put his work under the
chanRoblesvirtualLawlibrary protective mantle of the copyright law.36

WHEREFORE, considering the foregoing premises, the present Petition is GRANTED, and Ruling of the Court
accordingly, the assailed Resolutions dated 10 March 2006 and 25 May 2006
are ANNULLED and SET ASIDE. The Resolution of the Secretory of Justice dated 27
January 2006 finding probable cause against [the petitioners], is REINSTATED. It is a settled judicial policy that courts do not reverse the Secretary of Justice's findings
and conclusions on the matter of probable cause. Courts are not empowered to
SO ORDERED.32ChanRoblesVirtualawlibrary substitute their judgment for that of the executive branch upon which full discretionary
authority has been delegated in the determination of probable cause during a
The CA reiterated the above ruling in its Resolution33 dated February 24, 2011 when it preliminary investigation. Courts may, however, look into whether the exercise of such
denied the petitioners' motion for reconsideration. Hence, the present appeal, arguing discretionary authority was attended with grave abuse of discretion.37
that:
Otherwise speaking, "judicial review of the resolution of the Secretary of Justice is
I. There was no evidence of actual reproduction of the hatch doors during the limited to a determination of whether there has been a grave abuse of discretion
preliminary investigation that would lead the investigating prosecutor to amounting to lack or excess of jurisdiction."38
declare the existence of probable cause;34
The CA anchored its act of reversing the DOJ Resolution dated March 10, 2006 upon the
II. Even assuming that the petitioners manufactured hatch doors based on the
foregoing tenets. Thus, the Court's task in the present petition is only to determine if the
illustrations and plans covered by the respondent's Certificate of Registration
CA erred in concluding that the DOJ committed grave abuse of discretion in directing the
Nos. 1-2004-13 and 1-2004-14, the petitioners could not have committed
withdrawal of any criminal information filed against the petitioners.
copyright infringement. Certificate of Registration Nos. 1-2004-13 and 1-2004-
14 are classified under Section 172(i) which pertains to "illustrations, maps,
Grave abuse of discretion has been defined as "such capricious and whimsical exercise
plans, sketches, charts and three-dimensional works relative to geography,
of judgment as is equivalent to lack of jurisdiction. The abuse of discretion must be
topography, architecture or science." Hence the original works that are
grave as where the power is exercised in an arbitrary or despotic manner by reason of
copyrighted are the illustrations and plans of interior hatch doors and exterior
passion or personal hostility and must be so patent and gross as to amount to an
hatch doors. Thus, it is the reproduction of the illustrations and plans covered
evasion of positive duty or to a virtual refusal to perform the duty enjoined by or to act
by the copyright registration that amounts to copyright infringement. The
at all in contemplation of law."39 "'Capricious,' usually used in tandem with the term
petitioners did not reproduce the illustrations and plans covered under
'arbitrary,' conveys the notion of willful and unreasoning action."40cralawred
Certificate of Registration Nos. 1-2004-13 and 1-2004-14.

According to the CA, the DOJ's erratic findings on the presence or absence of probable
The manufacturing of hatch doors per se does not fall within the purview of
cause constitute grave abuse of discretion. The CA explained:
copyright infringement because copyright protection does not extend to the
chanRoblesvirtualLawlibrary
objects depicted in the illustrations and plans;35 and
This, to Our minds, in itself creates a nagging, persistent doubt as to whether [the DOJ
III. LEC's copyright registration certificates are not conclusive proofs that the items
Secretary] issued the said resolutions untainted with a whimsical and arbitrary use of his
covered thereby are copyrightable. The issuance of registration certificate and
discretion. For one cannot rule that there is reason to overturn the investigating
acceptance of deposit by the National Library is ministerial in nature and does
prosecutor's findings at the first instance and then go on to rule that ample evidence
not involve a determination of whether the item deposited is copyrightable or
exists showing that the hatch doors possess artistic and ornamental elements at the
not. Certificates of registration and deposit serve merely as a notice of
second instance and proceed to rule that no such artistry can be found on the purely
recording and registration of the work but do not confer any right or title upon
utilitarian hatch doors at the last instance. x x x.41ChanRoblesVirtualawlibrary
 The Court disagrees. It has been held that the issuance by the DOJ of several resolutions
with varying findings of fact and conclusions of law on the existence of probable cause,
by itself, is not indicative of grave abuse of discretion.42
Inconsistent findings and conclusions on the part of the DOJ will denote grave abuse of
discretion only if coupled with gross misapprehension of facts,43 which, after a
circumspect review of the records, is not attendant in the present case.
The facts upon which the resolutions issued by the investigating prosecutor and the DOJ
were actually uniform, viz:
chanRoblesvirtualLawlibrary
(a) LEC is the registered owner of plans/drawings for interior and exterior hatch doors
under Certificate of Registration Nos. 1-2004-13 and 1-2004-14 classified under
Section 172(i) of R.A. No. 8293 as pertaining to "illustrations, maps, plans, sketches,
charts and three-dimensional works relative to geography, topography, architecture
or science";
(b) LEC is also the registered owner of plans/drawings for interior and exterior hatch
doors under Certificate of Registration Nos. H-2004-566 and H-2004-567 classified
under Section 172(h) of R.A. No. 8293 as to "original ornamental designs or models
for articles of manufacture, whether or not registrable as an industrial design, and
other works of applied art";
(c) LEC as the subcontractor of SKI-FB in the Project first manufactured and installed
the interior and exterior hatch doors at the Manansala Tower in Rockwell Center,
Makati City, from the 7th to 22nd floors. The hatch doors were based on the
plans/drawings submitted by LEC to SKI-FB and subject of the above copyright
registration numbers; and
(d) thereafter, Metrotech fabricated and installed hatch doors at the same building's
23rd to 41st floor based on the drawings and specifications provided by SKI-FB.44
The positions taken by the DOJ and the investigating prosecutor differed only in the
issues tackled and the conclusions arrived at.
It may be observed that in the Resolution dated August 18, 2005 issued by the
investigating prosecutor, the primary issue was whether the hatch doors of LEC fall
within copyrightable works. This was resolved by ruling that hatch doors themselves are
not covered by LEC's Certificate of Registration Nos. 1-2004-13 and 1-2004-14 issued on
the plans/drawing depicting them. The DOJ reversed this ruling in its Resolution dated
January 27, 2006 wherein the issue was streamlined to whether the illustrations of the
hatch doors under LEC's Certificate of Registration Nos. H-2004-566 and H-2004-567
bore artistic ornamental designs.
This situation does not amount to grave abuse of discretion but rather a mere
manifestation of the intricate issues involved in the case which thus resulted in varying
conclusions of law. Nevertheless, the DOJ ultimately pronounced its definite construal of
copyright laws and their application to the evidence on record through its Resolution
dated March 10, 2006 when it granted the petitioners' motion for reconsideration. Such
construal, no matter how erroneous to the CA's estimation, did not amount to grave
abuse of discretion. "[I]t is elementary that not every erroneous conclusion of law or
fact is an abuse of discretion."45
More importantly, the Court finds that no grave abuse of discretion was committed by
the DOJ in directing the withdrawal of the criminal information against the respondents
because a finding of probable cause contradicts the evidence on record, law, and
jurisprudence.
"Probable cause has been defined as the existence of such facts and circumstances as
would excite the belief in a reasonable mind, acting on the facts within the knowledge
of the prosecutor, that the person charged was guilty of the crime for which he was
prosecuted. It is a reasonable ground of presumption that a matter is, or may be, well-
founded on such a state of facts in the mind of the prosecutor as would lead a person of
ordinary caution and prudence to believe, or entertain an honest or strong suspicion,
that a thing is so."46
"The term does not mean actual and positive cause nor does it import absolute
certainty. It is merely based on opinion and reasonable belief. Thus, a finding of
probable cause does not require an inquiry into whether there is sufficient evidence to
procure a conviction. It is enough that it is believed that the act or omission complained
of constitutes the offense charged."47
"In order that probable cause to file a criminal case may be arrived at, or in order to
engender the well-founded belief that a crime has been committed, the elements of the
crime charged should be present. This is based on the principle that every crime is
defined by its elements, without which there should be - at the most - no criminal
offense."48
A copyright refers to "the right granted by a statute to the proprietor of an intellectual
production to its exclusive use and enjoyment to the extent specified in the
statute."49 Under Section 177 of R.A. No. 8293, the Copyright or Economic Rights consist
of the exclusive right to carry out, authorize or prevent the following acts:
chanRoblesvirtualLawlibrary
177.1 Reproduction of the work or substantial portion of the work;
177.2 Dramatization, translation, adaptation, abridgment, arrangement or other
transformation of the work;
177.3 The first public distribution of the original and each copy of the work by sale or
other forms of transfer of ownership;
177.4 Rental of the original or a copy of an audiovisual or cinematographic work, a
work embodied in a sound recording, a computer program, a compilation of data
and other materials or a musical work in graphic form, irrespective of the
ownership of the original or the copy which is the subject of the rental;
177.5 Public display of the original or a copy of the work;
177.6 Public performance of the work; and
177.7 Other communication to the public of the work.
Copyright infringement is thus committed by any person who shall use original literary
or artistic works, or derivative works, without the copyright owner's consent in such a
manner as to violate the foregoing copy and economic rights. For a claim of copyright
infringement to prevail, the evidence on record must demonstrate: (1) ownership of a
validly copyrighted material by the complainant; and (2) infringement of the copyright
by the respondent.50
While both elements subsist in the records, they did not simultaneously concur so as to
substantiate infringement of LEC's two sets of copyright registrations.
The respondent failed to substantiate the alleged reproduction of the
drawings/sketches of hatch doors copyrighted under Certificate of Registration Nos. 1-
2004-13 and 1-2004-14. There is no proof that the respondents reprinted the
copyrighted sketches/drawings of LEC's hatch doors. The raid conducted by the NBI on
Metrotech's premises yielded no copies or reproduction of LEC's copyrighted
sketches/drawings of hatch doors. What were discovered instead were finished and
unfinished hatch doors.
Certificate of Registration Nos. 1-2004-13 and 1-2004-14 pertain to class work "I" under
Section 172 of R.A. No. 8293 which covers "illustrations, maps, plans, sketches, charts
and three-dimensional works relative to geography, topography, architecture or
science."51 As such, LEC's copyright protection there under covered only the hatch door
sketches/drawings and not the actual hatch door they depict.52
As the Court held in Pearl and Dean (Philippines), Incorporated v. Shoemart,
Incorporated:53
Copyright, in the strict sense of the term, is purely a statutory right. Being a mere
statutory grant, the rights are limited to what the statute confers. It 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.54 (Citations omitted and italics in the original)
Since the hatch doors cannot be considered as either illustrations, maps, plans,
sketches, charts and three-dimensional works relative to geography, topography,
architecture or science, to be properly classified as a copyrightable class "I" work, what
was copyrighted were their sketches/drawings only, and not the actual hatch doors
themselves. To constitute infringement, the usurper must have copied or appropriated
the original work of an author or copyright proprietor, absent copying, there can be no
infringement of copyright.55
"Unlike a patent, a copyright gives no exclusive right to the art disclosed; protection is
given only to the expression of the idea — not the idea itself."56
The respondent claimed that the petitioners committed copyright infringement when
they fabricated/manufactured hatch doors identical to those installed by LEC. The
petitioners could not have manufactured such hatch doors in substantial quantities had
they not reproduced the copyrighted plans/drawings submitted by LEC to SK1-FB. This
insinuation, without more, does not suffice to establish probable cause for infringement
against the petitioners. "[Although the determination of probable cause requires less
than evidence which would justify conviction, it should at least be more than mere
suspicion."57
Anent, LEC's Certificate of Registration Nos. H-2004-566 and H-2004-567, the Court finds
that the ownership thereof was not established by the evidence on record because the
element of copyrightability is absent.
"Ownership of copyrighted material is shown by proof of originality and
copyrightability."58 While it is true that where the complainant presents a copyright
certificate in support of the claim of infringement, the validity and ownership of the
copyright is presumed. This presumption, however, is rebuttable and it cannot be
sustained where other evidence in the record casts doubt on the question of
ownership,59 as in the instant case.
Moreover, "[t]he presumption of validity to a certificate of copyright registration merely
orders the burden of proof. The applicant should not ordinarily be forced, in the first
instance, to prove all the multiple facts that underline the validity of the copyright
unless the respondent, effectively challenging them, shifts the burden of doing so to the
applicant."60
Here, evidence negating originality and copyrightability as elements of copyright
ownership was satisfactorily proffered against LEC's certificate of registration.
The following averments were not successfully rebuffed by LEC:
chanRoblesvirtualLawlibrary
[T]he hinges on LEC's "hatch doors" have no ornamental or artistic value. In fact, they
are just similar to hinges found in truck doors that had been in common use since the
1960's. The gaskets on LEC's "hatch doors", aside from not being ornamental or artistic,
were merely procured from a company named Pemko and are not original creations of
LEC. The locking device in LEC's "hatch doors" are ordinary drawer locks commonly used
in furniture and office desks.61ChanRoblesVirtualawlibrary
In defending the copyrightability of its hatch doors' design, LEC merely claimed:
chanRoblesvirtualLawlibrary
LEC's Hatch Doors were particularly designed to blend in with the floor of the units in
which they are installed and, therefore, appeal to the aesthetic sense of the owner of
units or any visitors thereto[;]
LEC's Hatch Doors have a distinct set of hinges, a distinct door a distinct jamb, all of
which are both functional or utilitarian and artistic or ornamental at the same time[;]
and
Moreover, the Project is a high-end residential building located in the Rockwell Center, a
very prime area in Metro Manila. As such, the owner of the Project is not expected to
settle for Hatch Doors that simply live up to their function as such. The owner would
require, as is the case for the Project, Hatch Doors that not only fulfill their utilitarian
purposes but also appeal to the artistic or ornamental sense of their
beholders.62ChanRoblesVirtualawlibrary
From the foregoing description, it is clear that the hatch doors were not artistic works
within the meaning of copyright laws. A copyrightable work refers to literary and artistic
works defined as original intellectual creations in the literary and artistic domain.63
A hatch door, by its nature is an object of utility. It is defined as a small door, small gate
or an opening that resembles a window equipped with an escape for use in case of fire
or emergency.64 It is thus by nature, functional and utilitarian serving as egress access
during emergency. It is not primarily an artistic creation but rather an object of utility
designed to have aesthetic appeal. It is intrinsically a useful article, which, as a whole, is
not eligible for copyright.
A "useful article" defined as an article "having an intrinsic utilitarian function that is not
merely to portray the appearance of the article or to convey information" is excluded
from copyright eligibility.65
The only instance when a useful article may be the subject of copyright protection is
when it incorporates a design element that is physically or conceptually separable from
the underlying product. This means that the utilitarian article can function without the
design element. In such an instance, the design element is eligible for copyright
protection.66
The design of a useful article shall be considered a pictorial, graphic, or sculptural work
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.67
A belt, being an object utility with the function of preventing one's pants from falling
down, is in itself not copyrightable. However, an ornately designed belt buckle which is
irrelevant to or did not enhance the belt's function hence, conceptually separable from
the belt, is eligible for copyright. It is copyrightable as a sculptural work with
independent aesthetic value, and not as an integral element of the belt's functionality.68
A table lamp is not copyrightable because it is a functional object intended for the
purpose of providing illumination in a room. The general shape of a table lamp is
likewise not copyrightable because it contributes to the lamp's ability to illuminate the
reaches of a room. But, a lamp base in the form of a statue of male and female dancing
figures made of semi vitreous china is copyrightable as a work of art because it is
unrelated to the lamp's utilitarian function as a device used to combat darkness.69
In the present case, LEC's hatch doors bore no design elements that are physically and
conceptually separable, independent and distinguishable from the hatch door itself. The
allegedly distinct set of hinges and distinct jamb, were related and necessary hence, not
physically or conceptually separable from the hatch door's utilitarian function as an
apparatus for emergency egress. Without them, the hatch door will not function.

More importantly, they are already existing articles of manufacture sourced from
different suppliers. Based on the records, it is unrebutted that: (a) the hinges are similar
to those used in truck doors; (b) the gaskets were procured from a company named
Pemko and are not original creations of LEC; and (c) the locking device are ordinary
drawer locks commonly used in furniture and office desks.

Being articles of manufacture already in existence, they cannot be deemed as original

creations. As earlier stated, valid copyright ownership denotes originality of the
copyrighted material. Originality means that the material was not copied, evidences at
least minimal creativity and was independently created by the author.70 It connotes
production as a result of independent labor.71 LEC did not produce the door jambs and
hinges; it bought or acquired them from suppliers and thereafter affixed them to the
hatch doors. No independent original creation can be deduced from such acts.

The same is true with respect to the design on the door's panel. As LEC has stated, the
panels were "designed to blend in with the floor of the units in which they [were]
installed."72 Photos of the panels indeed show that their color and pattern design were
similar to the wooden floor parquet of the condominium units.73 This means that the
design on the hatch door panel was not a product of LEC's independent artistic
judgment and discretion but rather a mere reproduction of an already existing design.

Verily then, the CA erred in holding that a probable cause for copyright infringement is
imputable against the petitioners. Absent originality and copyrightability as elements of
a valid copyright ownership, no infringement can subsist.chanrobleslaw

WHEREFORE, premises considered, the petition is hereby GRANTED. The Decision dated

July 9, 2010 and Resolution dated February 24, 2011 of the Court of Appeals in CA-G.R.
SP No. 95471 are REVERSEDand SET ASIDE. The Resolutions dated March 10, 2006 and G.R. No. 222702
May 25, 2006 of the Department of Justice in I.S. No. 2004-925 dismissing the complaint
for copyright infringement are REINSTATED. RAPPLER, INC., Petitioner, 
vs.
SO ORDERED. ANDRES D. BAUTISTA, Respondent.

Velasco, Jr., (Chairperson), Peralta, Perez, and Jardeleza, JJ., RESOLUTION

CARPIO, J.:
Petitioner Rappler, Inc. (petitioner) filed a petition for certiorari  and prohibition against
Andres D. Bautista (respondent), in his capacity as Chairman of the Commission on
Elections (COMELEC). The petition seeks to nullify Part VI (C), paragraph 19 and Part VI
(D), paragraph 20 of the Memorandum of Agreement (MOA) on the 2016 presidential
and vice-presidential debates, for being executed without or in excess of jurisdiction or
with grave abuse of discretion amounting to lack or excess of jurisdiction and for
violating the fundamental rights of petitioner protected under the Constitution. The
MOA, signed on 13 January 2016, was executed by the COMELEC through its Chairman,
respondent Bautista, and the Kapisanan ng mga Brodkaster ng Pilipinas (KBP), and the
various media networks, namely: ABS-CBN Corporation, GMA Network, Inc., Nine Media
Corporation, TV5 Network, Inc., Philstar Daily, Inc.,· Philippine Daily Inquirer, Inc., Manila
Bulletin Publishing Corporation, Philippine Business Daily Mirror Publishing, Inc., and
petitioner. Under the MOA, the KBP was designated as Debate Coordinator while ABS-
CBN, GMA, Nine Media, and TV5, together with their respective print media partners
were designated as Lead Networks.
Petitioner alleged that on 21 September 2015, respondent called for a meeting with
various media outlets to discuss the "PiliPinas 2016 Debates," for presidential and vice-
presidential candidates, which the COMELEC was organizing. 1 Respondent showed a
presentation explaining the framework of the debates, in which there will be three
presidential debates and one vice presidential debate. Respondent proposed that
petitioner and Google, Inc. be in charge of online and social media engagement.
Respondent announced during the meeting that KBP will coordinate with all media
entities regarding the organization and conduct of the debates.
On 22 September 2015, petitioner sent a proposed draft for broadcast pool guidelines to
COMELEC and the KBP. A broadcast pool has a common audio and video feed of the
debates, and the cost will be apportioned among those needing access to the same. KBP
informed petitioner that the proposal will be discussed in the next meeting.
On 19 October 2015, another meeting was held at the COMELEC office to discuss a draft
MOA on the debates. In the draft, petitioner and Google's participation were dropped in
favor of the online outlets owned by the Lead Networks. After the meeting, the
representatives of the Lead Networks drew lots to determine who will host each leg of
the debates. GMA and its partner Philippine Daily Inquirer sponsored the first
presidential debate in Mindanao on 21 February 2016; TV5, Philippine Star, and
Businessworld sponsored the second phase of presidential debate in the Visayas on 20
March 2016; ABS-CBN and Manila Bulletin will sponsor the presidential debate to be
held in Luzon on 24 April 20 16; and the lone vice-presidential debate will be sponsored
by CNN, Business Mirror, and petitioner on 10 April 2016. Petitioner alleged that the
draft MOA permitted online streaming, provided proper attribution is given the Lead
Network.
On 12 January 2016, petitioner was informed that the MOA signing was scheduled the
following day. Upon petitioner's request, the draft MOA was emailed to petitioner on
the evening of 12 January 2016. Petitioner communicated with respondent its concerns
regarding certain provisions of the MOA particularly regarding online streaming and the
imposition of a maximum limit of two minutes of debate excerpts for news reporting.
Respondent assured petitioner that its concerns will be addressed afterwards, but it has
to sign the MOA because time was of the essence. On 13 January 2016, petitioner, along
with other media networks and entities, executed the MOA with the KBP and the
COMELEC for the conduct of the three presidential debates and one vice-presidential
debate. Petitioner alleged that it made several communications with respondent and
the COMELEC Commissioners regarding its concerns on some of the MOA provisions,
but petitioner received no response. Hence, this petition.
In this petition for certiorari and prohibition, petitioner prays for the Court to render
judgment:
a. Declaring null and void, for being unconstitutional, pertinent parts of the
Memorandum of Agreement that violate the rights of the Petitioner, specifically Part VI
(C), paragraph 19 and Part VI (D), paragraph 20 [of the MOA];
b. Prohibiting the Respondent from implementing specifically Part VI (C), paragraph 19
and Part VI (D), paragraph 20 of the MOA;
c. Pending resolution of this case, issuing a Preliminary Injunction enjoining the
Respondent from implementing Part VI (C), paragraph 19 and Part VI (D), paragraph 20
of the MOA; and
d. Pending resolution of this case, issuing a Preliminary Mandatory Injunction requiring
the Respondent to ensure an unimpaired and equal access to all mass media, online or
traditional, to all the Debates.2
Part VI (C), paragraph 19 and Part VI (D), paragraph 20 of the MOA read:
VI
ROLES AND RESPONSIBILITIES OF THE LEAD NETWORKS
xxxx
C. ONLINE STREAMING
xxxx
19. Subject to copyright conditions or separate negotiations with the Lead Networks,
allow the debates they have produced to be shown or streamed on other websites;
D. NEWS REPORTING AND FAIR USE
20. Allow a maximum of two minutes of excerpt from the debates they have produced
to be used for news reporting or fair use by other media or entities as allowed by the
copyright law: Provided, that the use of excerpts longer than two minutes shall be
subject to the consent of the Lead Network concerned;3
Respondent argues that the petition should be dismissed for its procedural defects. In
several cases, this Court has acted liberally and set aside procedural lapses in cases
involving transcendental issues of public interest,4especially when time constraint is a
factor to be considered, as in this case. As held in GMA Network, Inc. v. Commission on
Elections:5
Respondent claims that certiorari  and prohibition are not the proper remedies that
petitioners have taken to question the assailed Resolution of the
COMELEC.1âwphi1 Technically, respondent may have a point. However, considering the
very important and pivotal issues raised, and the limited time, such technicality should
not deter the Court from having to make the final and definitive pronouncement that
everyone else depends for enlightenment and guidance. "[T]his Court has in the past
seen fit to step in and resolve petitions despite their being the subject of an improper
remedy, in view of the public importance of the issues raised therein.6
The urgency to resolve this case is apparent considering that the televised debates have
already started and only two of the scheduled four national debates remain to be
staged. 7 And considering the importance of the debates in informing the electorate of
the positions of the presidential and vice-presidential candidates on vital issues affecting
the nation, this case falls under the exception laid down in GMA Network,
Inc. v. Commission on Elections.
Petitioner is a signatory to the MOA. In fact, the sole vice-presidential debate, to be held
in Manila on 10 April 2016, will be sponsored by CNN Philippines (owned and operated
by Nine Media Corporation) and its partners Business Mirror and petitioner. Petitioner,
however, is alleging that it is being discriminated particularly as regards the MOA
provisions on live audio broadcast via online streaming. Petitioner argues that the MOA
grants radio stations the right to simultaneously broadcast live the audio of the debates,
even if the radio stations are not obliged to perform any obligation under the MOA. Yet,
this right to broadcast by live streaming online the audio of the debates is denied
petitioner and other online media entities, which also have the capacity to live stream
the audio of the debates. Petitioner insists that it signed the MOA believing in good faith
the issues it has raised will be resolved by the COMELEC.
The provisions on Live Broadcast and Online Streaming under the MOA read:
VI
ROLES AND RESPONSIBILITIES OF THE LEAD NETWORKS
xxxx
B1. LIVE BROADCAST
10. Broadcast the debates produced by the Lead Networks in their respective television
stations and other news media platforms;
11. Provide a live feed of the debate to other radio stations, other than those of the
Lead Network's, for simultaneous broadcast;
12. Provide a live feed of the debates produced by them to radio stations not belonging
to any of the Lead Networks for simultaneous broadcast;
xxxx
C. ONLINE STREAMING
17. Live broadcast the debates produced by the Lead Networks on their  respective web
sites and social media sites for free viewing by the public;
18. Maintain a copy of the debate produced by the Lead Network on its on-line site(s)
for free viewing by the public during the period of elections or longer;
19. Subject to copyright conditions or separate negotiations with the Lead Networks,
allow the debates they have produced to be shown or streamed on other
websites;8 (Boldfacing and underscoring supplied)
Petitioner's demand to exercise the right to live stream the debates is a contractual right
of petitioner under the MOA. Under Part VI (C), paragraph 19 of the MOA, the Lead
Networks are expressly mandated to "allow the debates they have produced to be
shown or streamed on other websites," but "subject to copyright
conditions or  separate negotiations with the Lead Networks." The use of the word "or"
means that compliance with the "copyright conditions" is sufficient for petitioner to
exercise its right to live stream the debates in its website.
The "copyright conditions" refer to the limitations on copyright as provided under
Section 184.1 (c) of the Intellectual Property Code (IPC), thus:
SEC. 184. Limitations on Copyright.  - 184. l Notwithstanding the provisions of Chapter V,
the following acts shall not constitute infringement of copyright:
xxxx
(c) The reproduction or communication to the public by mass media of articles on
current political, social, economic, scientific or religious topic, lectures, addresses and
other works of the same nature, which are delivered in public if such use is for
information purposes and has not been expressly reserved;  Provided,  That the source
is clearly indicated; (Sec. 11, P.D. No. 49) (Boldfacing and underscoring supplied)
Under this provision, the debates fall under "addresses and other works of the same
nature." Thus, the copyright conditions for the debates are: (1) the reproduction or
communication to the public by mass media of the debates is for information
purposes; (2) the debates have not been expressly reserved by the Lead
Networks (copyright holders); and (3) the source is clearly indicated.
Condition 1 is complied because the live streaming by petitioner is obviously for
information purposes. Condition 2 is also complied because Part VI (C), paragraph 19 of
the MOA expressly "allow[s] the debates x x x to be shown or streamed on other
websites," including petitioner's website. This means that the "reproduction or
communication (of the debates) to the public by mass media x x x has not been
expressly reserved" or withheld. Condition 3 is complied by clearly indicating and
acknowledging that the source of the debates is one or more of the Lead Networks.
Part VI (C), paragraph 19 of the MOA, which expressly allows the debates produced by
the Lead Networks to be shown or streamed on other websites, clearly means that the
Lead Networks have not "expressly reserved" or withheld the use of the debate audio
for online streaming. In short, the MOA expressly allows the live streaming of the
debates subject only to compliance with the "copyright conditions." Once petitioner
complies with the copyright conditions, petitioner can exercise the right to live stream
the audio of the debates as expressly allowed by the MOA.
Under the MOA, the Lead Networks are mandated to promote the debates for
maximum audience.9 The MOA recognizes the public function of the debates and the
need for the widest possible dissemination of the debates. The MOA has not reserved
or withheld the reproduction of the debates to the public but has in fact expressly
allowed the reproduction of the debates "subject to copyright conditions." Thus,
petitioner may live stream the debate in its entirety by complying with the "copyright
conditions," including the condition that "the source is clearly indicated" and that there
will be no alteration, which means that the streaming will include the proprietary
graphics used by the Lead Networks. If petitioner opts for a clean feed without the
proprietary graphics used by the Lead Networks, in order for petitioner to layer its own
proprietary graphics and text on the same, then petitioner will have to negotiate
separately with the Lead Networks. Similarly, if petitioner wants to alter the debate
audio by deleting the advertisements, petitioner will also have to negotiate with the
Lead Networks.
Once the conditions imposed under Section 184.1 (c) of the IPC are complied with, the
information - in this case the live audio of the debates - now forms part of the public
domain. There is now freedom of the press to report or publicly disseminate the live
audio of the debates. In fact, the MOA recognizes the right of other mass media entities,
not parties to the MOA, to reproduce the debates subject only to the same copyright
conditions. The freedom of the press to report and disseminate the live audio of the
debates, subject to compliance with Section 184. l (c) of the IPC, can no longer be
infringed or subject to prior restraint. Such freedom of the press to report and
disseminate the live audio of the debates is now protected and guaranteed under
Section 4, Article III of the Constitution, which provides that "[N]o law shall be passed
abridging the freedom x x x of the press."
The presidential and vice-presidential debates are held primarily for the benefit of the
electorate to assist the electorate in making informed choices on election day. Through
the conduct of the national debates among presidential and vice-presidential
candidates, the electorate will have the "opportunity to be informed of the candidates'
qualifications and track record, platforms and programs, and their answers to significant
issues of national concern." 10 The political nature of the national debates and the
public's interest in the wide availability of the information for the voters' education
certainly justify allowing the debates to be shown or streamed in other websites for
wider dissemination, in accordance with the MOA.
Therefore, the debates should be allowed to be live streamed on other websites,
including petitioner's, as expressly mandated in Part VI (C), paragraph 19 of the MOA.
The respondent, as representative of the COMELEC which provides over-all supervision
under the MOA, including the power to "resolve issues that may arise among the parties
involved in the organization of the debates," 11 should be directed by this Court to
implement Part VI (C), paragraph 19 of the MOA, which allows the debates to be shown
or live streamed unaltered on petitioner's and other websites subject to the copyright
condition that the source is clearly indicated.
WHEREFORE, we PARTIALLY GRANT the petition. Respondent Andres D. Bautista, as
Chairman of the COMELEC, is directed to implement Part VI (C), paragraph 19 of the
MOA, which allows the debates to be shown or live streamed unaltered on petitioner's
and other websites subject to the copyright condition that the source is clearly
indicated. Due to the time constraint, this Resolution is immediately executory.
SO ORDERED.
ANTONIO T. CARPIO
Associate Justice

G.R. No. 195956, March 11, 2015

ABS-CBN CORPORATION, Petitioner, v. FELIPE GOZON, GILBERTO R. DUAVIT, JR.,

MARISSA L. FLORES, JESSICA A. SOHO, GRACE DELA PEÑA-REYES, JOHN OLIVER T.
MANALASTAS, JOHN DOES AND JANE DOES, Respondents.

DECISION

LEONEN, J.:
The main issue in this case is whether there is probable cause to charge respondents
with infringement under Republic Act No. 8293, otherwise known as the Intellectual
Property Code. The resolution of this issue requires clarification of the concept of
"copyrightable material" in relation to material that is rebroadcast live as a news story.
We are also asked to rule on whether criminal prosecution for infringement of
copyrightable material, such as live rebroadcast, can be negated by good faith.
1
ABS-CBN Corporation (ABS-CBN) filed the Petition for Review on Certiorari  to assail the
November 9, 2010 Decision2 and the March 3, 2011 Resolution3 of the Court of Appeals.
The Court of Appeals reinstated the Department of Justice Resolution dated August 1,
2005 that ordered the withdrawal of the Information finding probable cause for
respondents' violation of Sections 1774 and 2115 of the Intellectual Property
Code.6 Respondents are officers and employees of GMA Network, Inc. (GMA-7). They
are: Felipe Gozon (Gozon), GMA-7 President; Gilberto R. Duavit, Jr. (Duavit, Jr.),
Executive Vice-President; Marissa L. Flores (Flores), Vice-President for News and Public
Affairs; Jessica A. Soho (Soho), Director for News; Grace Déla Peña-Reyes (Dela Peña-
Reyes), Head of News and Public Affairs; John Oliver Manalastas '(Manalastas), Program
Manager; and others.
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:chanroblesvirtuallawlibrary
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.7
ABS-CBN "conducted live audio-video coverage of and broadcasted the arrival of Angelo
dela Cruz at the Ninoy Aquino International Airport (NAIA) and the subsequent press
conference."8 ABS-CBN allowed Reuters Television Service (Reuters) to air the footages
it had taken earlier under a special embargo agreement.9
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."10
GMA-7, to which Gozon, Duavit, Jr., Flores, Soho, Dela Peña-Reyes, and Manalastas are
connected, "assigned and stationed news reporters and technical men at the NAIA for
its live broadcast and non-live news coverage of the arrival of dela Cruz."11 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.12
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.15
On August 13, 2004, ABS-CBN filed the Complaint for copyright infringement under
Sections 17716 and 21117 of the Intellectual Property Code.18
On December 3, 2004, Assistant City Prosecutor Dindo Venturanza issued the
Resolution19 finding probable cause to indict Dela Peña-Reyes and
Manalastas.20 Consequently, the Information21 for violation of the Intellectual Property
Code was filed on December 17, 2004. It reads:chanroblesvirtuallawlibrary
That on or about the 22nd of July 2004, in Quezon City, Philippines, the above-named
accused, conspiring together, confederating with and mutually helping each other, being
the Head of News Operations and the Program Manager, respectively, for the News and
Public Affairs Department of GMA Network, Inc., did then and there, willfully, unlawfully
and feloniously use and broadcast the footage of the arrival of Angelo [d]ela Cruz at the
Ninoy Aquino International Airport of which ABS-CBN holds the exclusive ownership and
copyright by then and there using, airing, and broadcasting the said footage in its news
program "FLASH REPORT" without first obtaining the consent or authority of said
copyright owner, to their damage and prejudice.
Contrary to law.22
On January 4, 2005, respondents filed the Petition for Review before the Department of
Justice.23 In the Resolution (Gonzalez Resolution) dated August 1, 2005, 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.24 The dispositive portion
of the Resolution reads:chanroblesvirtuallawlibrary
WHEREFORE,  THE PETITION FOR REVIEW FILED BY GMA-7 in I.S. No. 04-10458 is
considered meritorious and is hereby GRANTED. This case is hereby Dismissed, the
resolution of the City Prosecutor of Quezon City is hereby reversed and the same is
ordered to withdraw the information if any and report action taken to this office within
ten (10) days.25 (Emphasis in the original)
Both parties moved for reconsideration of the Gonzalez Resolution.26
Meanwhile, on January 19, 2005, the trial court granted the Motion to Suspend
Proceedings filed earlier by Dela Peña-Reyes and Manalastas.27 The trial court Order
reads:chanroblesvirtuallawlibrary
Perusing the motion, the court finds that a petition for review was filed with the
Department of Justice on January 5, 2005 as confirmed by the public prosecutor. Under
Section 11 (c), Rule 116 of the Rules of Criminal Procedure, once a petition for review is
filed with the Department of Justice, a suspension of the criminal proceedings may be
allowed by the court.
Accordingly, to allow the Department of Justice the opportunity to act on said petition
for review, let the proceedings on this case be suspended for a period of sixty (60) days
counted from January 5, 2005, the date the petition was filed with the Department of
Justice. The arraignment of the accused on February 1, 2005 is accordingly cancelled. Let
the arraignment be rescheduled to March 8, 2005 at 8:30 a.m. The accused through
counsel are notified in open court.
SO ORDERED.28
On June 29, 2010, Department of Justice Acting Secretary Alberto C. Agra (Secretary
Agra) issued the Resolution (Agra Resolution) that reversed the Gonzalez Resolution and
found probable cause to charge Dela Peña-Reyes and Manalastas for violation of the
Intellectual Property Code.29 Secretary Agra also found probable cause to indict Gozon,
Duavit, Jr., Flores, and Soho for the same violation.30 He ruled
that:chanroblesvirtuallawlibrary
[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.31
The dispositive portion of the Agra Resolution provides:chanroblesvirtuallawlibrary
WHEREFORE, premises considered:
(a) The Motion for Reconsideration filed by appellees ABS-CBN Broadcasting
Corporation (ABS-CBN) of our Resolution promulgated on August 1, 2005 (Resolution
No. 364, Series of 2005) and the Petition for Review filed by complainant-appellant ABS-
CBN in I.S. No. 04-10458 on April 10, 2006, are GRANTED and the City Prosecutor of
Quezon City is hereby ordered to file the necessary Information for violation of Section
177 and 211 of Republic Act No. 8293 against GMA-7. Felipe L. Gozon, Gilberto R.
Duavit, Jr., Marissa L. Flores, Jessica A. Soho, Grace Dela Pena-Reyes, John Oliver T.
Manalastas[.]
SO ORDERED.32 (Emphasis in the original)
Respondents assailed the Agra Resolution through the Petition for Certiorari with prayer
for issuance of a temporary restraining order and/or Writ of Preliminary Injunction on
September 2, 2010 before the Court of Appeals. In the Resolution dated September 13,
2010, the Court of Appeals granted the temporary restraining order preventing the
Department of Justice from enforcing the Agra Resolution.33
On November 9, 2010, the Court of Appeals rendered the Decision granting the Petition
and reversing and setting aside the Agra Resolution.34 The Court of Appeals held that
Secretary Agra committed errors of jurisdiction in issuing the assailed Resolution. 
Resolving the issue of copyright infringement, the Court of Appeals
said:chanroblesvirtuallawlibrary
Surely, private respondent has a copyright of its news coverage. Seemingly, for airing
said video feed, petitioner GMA is liable under the provisions of the Intellectual Property
Code, which was enacted purposely to protect copyright owners from
infringement. 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.35 (Emphasis supplied)
The dispositive portion of the Decision reads:chanroblesvirtuallawlibrary
WHEREFORE, the foregoing considered, the instant petition is hereby GRANTED and the
assailed Resolution dated 29 June 2010 REVERSED and SET ASIDE. Accordingly, the
earlier Resolution dated 1 August 2005, which ordered the withdrawal of the
Information filed, if any, against the petitioners for violation of Sections 177 and 211 of
the Intellectual Property Code, is hereby REINSTATED. No costs.
SO ORDERED.36 (Emphasis in the original)
ABS-CBN's Motion for Reconsideration was denied.37 It then filed its Petition for Review
before this court assailing the Decision and Resolution of the Court of Appeals.38
The issues for this court's consideration are:
First, whether Secretary Agra committed errors of jurisdiction in the Resolution dated
June 29, 2010 and, therefore, whether a petition for certiorari was the proper remedy in
assailing that Resolution;
Second, whether news footage is copyrightable under the law;
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; and
Lastly, whether the Court of Appeals was correct in overturning Secretary Agra's finding
of probable cause.cralawlawlibrary
I terminated upon the filing of the information in the proper court. In turn, as above
The trial court granted respondents' Motion to Suspend Proceedings and deferred
respondents Dela Peña-Reyes and Manalastas' arraignment for 60 days in view of the
Petition for Review filed before the Department of Justice.
Rule 116, Section 11 (c) of the Rules of Criminal Procedure allows the suspension of the
accused's arraignment in certain circumstances only:chanroblesvirtuallawlibrary
SEC. 11.  Suspension of arraignment.-Upon motion by the proper party, the arraignment
shall be suspended in the following cases:
(a) The accused appears to be suffering from an unsound mental condition which
effectively renders him unable to fully understand the charge against him and to plead
intelligently thereto.  In such case, the court shall order his mental examination and, if
necessary, his confinement for such purpose;
(b) There exists a prejudicial question; and
(c) A petition for review of the resolution of the prosecutor is pending at either the
Department of Justice, or the Office of the President; provided, that the period of
suspension shall not exceed sixty (60) days counted from the filing of the petition with
the reviewing office. (12a) (Emphasis supplied)
In Samson v. Daway,39 this court acknowledged the applicability of Rule 116, Section (c)
in a criminal prosecution for infringement under the Intellectual Property Code.
However, this court emphasized the limits of the order of deferment under the Rule:
While the pendency of a petition for review is a ground for suspension of the
arraignment, the . . . provision limits the deferment of the arraignment to a period of 60
days reckoned from the filing of the petition with the reviewing office. It follows,
therefore, that after the expiration of said period, the trial court is bound to arraign the
accused or to deny the motion to defer arraignment. 40
We clarify that the suspension of the arraignment should always be within the limits
allowed by law. In Crespo v. Judge Mogul,41 this court outlined the effects of filing an
information before the trial court, which includes initiating a criminal action and giving
this court "authority to hear and determine the case":42ChanRoblesVirtualawlibrary
The preliminary investigation conducted by the fiscal for the purpose of determining
whether a prima facie case exists warranting the prosecution of the accused is
stated, the filing of said information sets in motion the criminal action against the
accused in Court. Should the fiscal find it proper to conduct a reinvestigation of the case,
at such stage, the permission of the Court must be secured. After such reinvestigation
the finding and recommendations of the fiscal should be submitted to the Court for
appropriate action. While it is true that the fiscal has the quasi judicial discretion to
determine whether or not a criminal case should be filed in court or not, once the case
had already been brought to Court whatever disposition the fiscal may feel should be
proper in the case thereafter should be addressed for the consideration of the Court,
the only qualification is that the action of the Court must not impair the substantial
rights of the accused or the right of the People to due process of law.
Whether the accused had been arraigned or not and whether it was due to a
reinvestigation by the fiscal or a review by the Secretary of Justice whereby a motion to
dismiss was submitted to the Court, the Court in the exercise of its discretion may grant
the motion or deny it and require that the trial on the merits proceed for the proper
determination of the case.
However, one may ask, if the trial court refuses to grant the motion to dismiss filed by
the fiscal upon the directive of the Secretary of Justice will there not be a vacuum in the
prosecution? A state prosecutor to handle the case cannot possibly be designated by
the Secretary of Justice who does not believe that there is a basis for prosecution nor
can the fiscal be expected to handle the prosecution of the case thereby defying the
superior order of the Secretary of Justice.
The answer is simple. The role of the fiscal or prosecutor as We all know is to see that
justice is done and not necessarily to secure the conviction of the person accused before
the Courts. Thus, in spite of his opinion to the contrary, it is the duty of the fiscal to
proceed with the presentation of evidence of the prosecution to the Court to enable the
Court to arrive at its own independent judgment as to whether the accused should be
convicted or acquitted. The fiscal should not shirk from the responsibility of appearing
for the People of the Philippines even under such circumstances much less should he
abandon the prosecution of the case leaving it to the hands of a private prosecutor for
then the entire proceedings will be null and void. The least that the fiscal should do is to
continue to appear for the prosecution although he may turn over the presentation of
the evidence to the private prosecutor but still under his direction and control.
The rule therefore in this jurisdiction is that once a complaint or information is filed in
Court any disposition of the case as to its dismissal or the conviction or acquittal of the
accused rests in the sound discretion of the Court. Although the fiscal retains the
direction and control of the prosecution of criminal cases even while the case is already
in Court he cannot impose his opinion on the trial court. The Court is the best and sole
judge on what to do with the case before it. The determination of the case is within its
exclusive jurisdiction and competence. A motion to dismiss the case filed by the fiscal
should be addressed to the Court who has the option to grant or deny the same. It does
not matter if this is done before or after the arraignment of the accused or that the
motion was filed after a reinvestigation or upon instructions of the Secretary of Justice
who reviewed the records of the investigation.43 (Emphasis supplied, citations omitted)
The doctrine in Crespo was reiterated in Mayor Balindong v. Court of Appeals,44 where
this court reminded the Department of Justice Secretary to refrain from entertaining
petitions for review when the case is already pending with this
court:chanroblesvirtuallawlibrary
[I]n order to avoid a situation where the opinion of the Secretary of Justice who
reviewed the action of the fiscal may be disregarded by the trial court, the Secretary of
Justice should, as far as practicable, refrain from entertaining a petition for review or
appeal from the action of the fiscal, when the complaint or information has already
been filed in the Court. The matter should be left entirely for the determination of the
Court.45
The trial court should have proceeded with respondents Dela Peña-Reyes and
Manalastas' arraignment after the 60-day period from the filing of the Petition for
Review before the Department of Justice on March 8, 2005. It was only on September
13, 2010 that the temporary restraining order was issued by the Court of Appeals. The
trial court erred when it did not act on the criminal case during the interim period. It had
full control and direction of the case. As Judge Mogul reasoned in denying the motion to
dismiss in Crespo, failure to proceed with the arraignment "disregards the requirements
of due process [and] erodes the Court's independence and integrity."46
II
According to ABS-CBN, the Court of Appeals erred in finding that: a motion for
reconsideration was not necessary before a petition for certiorari could be filed; the
Department of Justice Secretary committed errors of jurisdiction since the Agra
Resolution was issued within its authority and in accordance with settled laws and
jurisprudence; and respondents were not liable for copyright infringement.
In its assailed Decision, the Court of Appeals found that respondents committed a
procedural error when they failed to file a motion for reconsideration before filing the
Petition for Certiorari. However, the Court of Appeals held that a motion for
reconsideration was unnecessary since the Agra Resolution was a patent nullity and it
would have been useless under the circumstances:chanroblesvirtuallawlibrary
Given that a reading of the assailed Resolution and the instant records readily reveals
errors -of jurisdiction on the part of respondent Secretary, direct judicial recourse is
warranted under the circumstances. Aside from the fact that said Resolution is a patent
nullity having been issued in grave abuse of discretion amounting to lack or excess of
jurisdiction, the filing of a motion for reconsideration is evidently useless on account of
the fact that the issues and arguments before this Court have already been duly raised
and accordingly delved into by respondent Secretary in his disposition of the petition a
quo.47(Emphasis in the original)
In Elma v. Jacobi,48 this court ruled that a petition for certiorari under Rule 65 of the
Rules of Court is proper when assailing adverse resolutions of the Department of Justice
stemming from the determination of probable cause.49  However, grave abuse of
discretion must be alleged.50
In Sanrio Company Limited v. Lim,51 this court stressed the prosecutor's role in
determining probable cause. Judicial review will only lie when it is shown that the
prosecutor acted with grave abuse of discretion amounting to lack or excess of
jurisdiction:chanroblesvirtuallawlibrary
A prosecutor alone determines the sufficiency of evidence that will establish probable
cause justifying the filing of a criminal information against the respondent. By way of
exception, however, judicial review is allowed where respondent has clearly established
that the prosecutor committed grave abuse of discretion. Otherwise stated, such review
is appropriate only when the prosecutor has exercised his discretion in an arbitrary,
capricious, whimsical or despotic manner by reason of passion or personal hostility,
patent and gross enough to amount to an evasion of a positive duty or virtual refusal to
perform a duty enjoined by law.52  (Citations omitted)
Grave abuse of discretion refers to:chanroblesvirtuallawlibrary
such capricious and whimsical exercise of judgment as is equivalent to lack of
jurisdiction. The abuse of discretion must be grave as where the power is exercised in an
arbitrary or despotic manner by reason of passion or personal hostility and must be so
patent and gross as to amount to an evasion of positive duty or to a virtual refusal to
perform the duty enjoined by or to act at all in contemplation of law.53
Resorting to certiorari requires that there be there be "no appeal, or any plain, speedy,
and adequate remedy in the ordinary course of law[,]"54 such as a motion for
reconsideration. Generally, "a motion for reconsideration is a condition sine qua
non before a petition for certiorari may lie, its purpose being to grant an opportunity for
the [tribunal or officer] to correct any error attributed to it by a re-examination of the
legal and factual circumstances of the case."55
However, exceptions to the rule exist:chanroblesvirtuallawlibrary
(a) where the order is a patent nullity, as where the Court a quo had no jurisdiction; (b)
where the questions raised in the certiorari proceeding have been duly raised and
passed upon by the lower court, or are the same as those raised and passed upon in the
lower court; (c) where there is an urgent necessity for the resolution of the question and
any further delay would prejudice the interests of the Government or of the petitioner
or the subject matter of the action is perishable; (d) where, under the circumstances, a
motion for reconsideration would be useless; (e) where petitioner was deprived of due
process and there is extreme urgency for relief; (f) where, in a criminal case, relief from
an order of arrest is urgent and the granting of such relief by the trial Court is
improbable; (g) where the proceedings in the lower court are a nullity for lack of due
process; (h) where the proceedings was ex parte or in which the petitioner had no
opportunity to object; and (i) where the issue raised is one purely of law or where public
interest is involved.56(Emphasis in the original, citations omitted)
As argued by respondents, "[a] second motion for reconsideration would have been
useless and futile since the Department] [of] J[ustice] had already passed upon the same
issues twice."57 Equally pressing under the circumstances was the need to resolve the
matter, as the Information's filing would lead to respondents' imminent arrest.58
Moreover, Department of Justice Department Circular No. 70 dated July 3, 2000, or the
2000 NPS Rules on Appeal, provides that no second motion for reconsideration of the
Department of Justice Secretary's resolution shall be
entertained:chanroblesvirtuallawlibrary
SECTION 13. Motion for reconsideration. The aggrieved party may file a motion for
reconsideration within a non-extendible period of ten (10) days from receipt of the
resolution on appeal, furnishing the adverse party and the Prosecution Office concerned
with copies thereof and submitting proof of such service. No second or further motion
for reconsideration shall be entertained.
The Agra Resolution was the result of respondents' Motion for Reconsideration assailing
the Gonzalez Resolution. To file a motion for reconsideration of the Agra Resolution
would be superfluous. Respondents were, therefore, correct in filing the Petition for
Certiorari of the Agra Resolution before the Court of Appeals.cralawlawlibrary
III
The Court of Appeals ruled that Secretary Agra committed errors of jurisdiction, which
then required the grant of the writ of certiorari:chanroblesvirtuallawlibrary
So viewed, by ordering the filing of information without proof that probable cause exists
to charge petitioners with a crime, respondent Secretary clearly committed an error of
jurisdiction thus warranting the issuance of the writ of certiorari. Surely, probable cause
cannot be had when the very provisions of the statute exculpates criminal liability in
cases classified as fair use of copyrighted materials. The fact that they admittedly used
the Reuters live video feed is not, as a matter of course, tantamount to copyright
infringement that would justify the filing of an information against the petitioners.59
Error of jurisdiction must be distinguished from error of judgment:
A line must be drawn between errors of judgment and errors of jurisdiction. An error of
judgment is one which the court may commit in the exercise of its jurisdiction. An error
of jurisdiction renders an order or judgment void or voidable. Errors of jurisdiction are
reviewable on certiorari; errors of judgment, only by appeal.60
In People v. Hon. Sandiganbayan61:chanroblesvirtuallawlibrary
An error of judgment is one which the court may commit in the exercise of its
jurisdiction. An error of jurisdiction is one where the act complained of was issued by the
court without or in excess of jurisdiction, or with grave abuse of discretion, which is
tantamount to lack or in excess of jurisdiction and which error is correctible only by the
extraordinary writ of certiorari. Certiorari will not be issued to cure errors of the trial
court in its appreciation of the evidence of the parties, or its conclusions anchored on
the said findings and its conclusions of law.62 (Emphasis supplied)
This court has adopted a deferential attitude towards review of the executive's finding
of probable cause.63 This is based "not only upon the respect for the investigatory and
[prosecutorial] powers granted by the Constitution to the executive department but
upon practicality as well."64 Review of the Department of Justice Secretary's decision or
resolution will be allowed only when grave abuse of discretion is
alleged:chanroblesvirtuallawlibrary
The full discretionary authority to determine probable cause in a preliminary
investigation to ascertain sufficient ground for the filing of information rests with the
executive branch.Hence, judicial review of the resolution of the Secretary of Justice is
limited to a determination whether there has been a grave abuse of discretion
amounting to lack or excess of jurisdiction. Courts cannot substitute the executive
branch's judgment.
.       .       .       .
It is only where the decision of the Justice Secretary is tainted with grave abuse of
discretion amounting to lack or excess of jurisdiction that the Court of Appeals may take
cognizance of the case in a petition for certiorari under Rule 65 of the Revised Rules of
Civil Procedure.  The Court of Appeals decision may then be appealed to this Court by
way of a petition for review on certiorari.65 (Emphasis supplied, citations omitted)
In this case, it must be shown that Secretary Agra exceeded his authority when he
reversed the findings of Secretary Gonzalez. This court must determine whether there is
probable cause to file an information for copyright infringement under the Intellectual
Property Code.cralawlawlibrary
IV
Probable cause pertains to "such facts as are sufficient to engender a well-founded
belief that a crime has been committed and that respondent is probably guilty
thereof." 66 Preliminary investigation is the inquiry or proceeding to determine whether
there is probable cause.67
In Webb v. De Leon,68 this court ruled that determination of probable cause during
preliminary investigation does not require trial-like evaluation of evidence since
existence of probable cause does not equate to guilt:chanroblesvirtuallawlibrary
It ought to be emphasized that in determining probable cause, the average man weighs
facts and circumstances without resorting to the calibrations of our technical rules of
evidence of which his knowledge is nil. Rather, he relies on the calculus of common
sense of which all reasonable men have an abundance.
.       .       .       .
. . . A finding of probable cause merely binds over the suspect to stand trial. It is not a
pronouncement of guilt.69
In Reyes v. Pearlbank Securities, Inc.,70 finding probable cause is not equivalent to finding
with moral certainty that the accused committed the crime:
A finding of probable cause needs only to rest on evidence showing that more likely
than not a crime has been committed by the suspects. It need not be based on clear and
convincing evidence of guilt, not on evidence establishing guilt beyond reasonable
doubt, and definitely not on evidence establishing absolute certainty of guilt. In
determining probable cause, the average man weighs facts and circumstances without
resorting to the calibrations of the rules of evidence of which he has no technical
knowledge. He relies on common sense.71
During preliminary investigation, a public prosecutor does not adjudicate on the parties'
rights, obligations, or liabilities.72
situations which confront officers in the course of executing their duties are more or less
ambiguous, room must be allowed for some mistakes on their part. But the mistakes
must be those of reasonable men, acting on facts leading sensibly to their conclusions of
probability. The rule of probable cause is a practical, nontechnical conception affording
the best compromise that has been found for accommodating these often opposing
interests. Requiring more would unduly hamper law enforcement. To allow less would
be to leave law-abiding citizens at the mercy of the officers' whim or caprice.

In the recent case of Estrada v. Office of the Ombudsman, et al,73 we reiterated Webb on
the determination of probable cause during preliminary investigation and traced the
history of probable cause as borrowed from American
jurisprudence:chanroblesvirtuallawlibrary
The purpose in determining probable cause is to make sure that the courts are not
clogged with weak cases that will only be dismissed, as well as to spare a person from
the travails of a needless prosecution.
.       .       .       .
In the Philippines, there are four instances in the Revised Rules of Criminal Procedure
where probable cause is needed to be established:
  (1) In Sections 1 and 3 of Rule 112: By the investigating officer, to determine
whether there is sufficient ground to engender a well-founded belief that a
crime has been committed and the respondent is probably guilty thereof, and
should be held for trial. A preliminary investigation is required before the filing
of a complaint or information for an offense where the penalty prescribed by
law is at least four years, two months and one day without regard to the fine;

. . . In the United States, from where we borrowed the concept of probable cause, the  
prevailing definition of probable cause is this:chanroblesvirtuallawlibrary
In dealing with probable cause, however, as the very name implies, we deal with
probabilities. These are not technical; they are the factual and practical considerations
of everyday life on which reasonable and prudent men, not legal technicians, act. The  
standard of proof is accordingly correlative to what must be proved.
 
"The substance of all the definitions" of probable cause "is a reasonable ground for
belief of guilt." McCarthy v. De Armit, 99 Pa. St. 63, 69, quoted with approval in the
Carroll opinion. 267 U. S. at 161. And this "means less than evidence which would justify
condemnation" or conviction, as Marshall, C. J., said for the Court more than a century
ago in Locke v. United States, 7 Cranch 339, 348. Since Marshall's time, at any rate, it has
come to mean more than bare suspicion: Probable cause exists where "the facts and  
circumstances within their [the officers'] knowledge and of which they had reasonably
trustworthy information [are] sufficient in themselves to warrant a man of reasonable
caution in the belief that" an offense has been or is being committed. Carroll v. United
States, 267 U. S. 132, 162.
These long-prevailing standards seek to safeguard citizens from rash and unreasonable
interferences with privacy and from unfounded charges of crime. They also seek to give
fair leeway for enforcing the law in the community's protection. Because many
(2) In Sections 6 and 9 of Rule 112: By the judge, to determine whether a warrant
of arrest or a commitment order, if the accused has already been arrested,
shall be issued and that there is a necessity of placing the respondent under
immediate custody in order not to frustrate the ends of justice;
 
(3) In Section 5(b) of Rule 113: By a peace officer or a private person making a
warrantless arrest when an offense has just been committed, and he has
probable cause to believe based on personal knowledge of facts or
circumstances that the person to be arrested has committed it; and
(4) In Section 4 of Rule 126: By the judge, to determine whether a search warrant
shall be issued, and only upon probable cause in connection with one specific
offense to be determined personally by the judge after examination under oath
or affirmation of the complainant and the witnesses he may produce, and
particularly describing the place to be searched and the things to be seized
which may be anywhere in the
Philippines.

In all these instances, the evidence necessary to establish probable cause is based only
on the likelihood, or probability, of guilt.74
Estrada also highlighted that a "[preliminary investigation is not part of the criminal
action. It is merely preparatory and may even be disposed of in certain situations."75
To determine whether there is probable cause that respondents committed copyright
infringement, a review of the elements of the crime, including the existing facts, is
required.cralawlawlibrary
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":76ChanRoblesVirtualawlibrary
To be clear, it is the event itself or the arrival of Angelo dela Cruz which is not
copyrightable because that is the newsworthy event. However, any footage created
from the event itself, in this case the arrival of Angelo dela Cruz, are intellectual
creations which are copyrightable. Thus, the footage created by ABS-CBN during the
arrival of Angelo dela Cruz, which includes the statements of Dindo Amparo, are
copyrightable and protected by the laws on copyright.77
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:chanroblesvirtuallawlibrary
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 video footage of this "news" is not copyrightable by any legal standard as facts of
everyday life depicted in the news and items of press information is part of the public
domain.78 (Emphasis in the original)
The news footage is copyrightable.
The Intellectual Property Code is clear about the rights afforded to authors of various
kinds of work. Under the Code, "works are protected by the sole fact of their
creation, irrespective of their mode or form of expression, as well as of their content,
quality and purpose."79 These include "[audio-visual works and cinematographic works
and works produced by a process analogous to cinematography or any process for
making audiovisual recordings."80
Contrary to the old copyright law,81 the Intellectual Property Code does not require
registration of the work to fully recover in an infringement suit. Nevertheless, both
copyright laws provide that copyright for a work is acquired by an intellectual creator
from the moment of creation.82
It is true that under Section 175 of the Intellectual Property Code, "news of the day and
other miscellaneous facts having the character of mere items of press information" are
considered unprotected subject matter.83  However, the Code does not state
that expression of the news of the day, particularly when it underwent a creative
process, is not entitled to protection.
An idea or event must be distinguished from the expression of that idea or event. An
idea has been likened to a ghost in that it "must be spoken to a little before it will
explain itself."84 It is a concept that has eluded exact legal definition.85 To get a better
grasp of the idea/expression dichotomy, the etymology of the term "idea" is
traced:chanroblesvirtuallawlibrary
The word "idea" is derived from a Greek term, meaning "a form, the look or appearance
of a thing as opposed to its reality, from idein, to see." In the Timaeus, Plato saw ideas
as eternal paradigms, independent objects to which the divine demiurge looks as
patterns in forming the world. This was later modified to the religious conception of
ideas as the thoughts of God. "It is not a very long step to extend the term 'idea' to
cover patterns, blueprints, or plans in anyone's mind, not only in God's." The word
entered the French and English vernacular in the 1600s and possessed two meanings.
The first was the Platonic meaning of a perfect exemplar or paradigm. The second,
which probably has its origin with Descartes, is of a mental concept or image or, more
broadly, any object of the mind when it is active. Objects of thought may exist
independently. The sun exists (probably) before and after you think of it. But it is also
possible to think of things that have never existed, such as a unicorn or Pegasus. John
Locke defined ideas very comprehensively, to include: all objects of the mind. Language
was a way of translating the invisible, hidden ideas that make up a person's thoughts
into the external, perceptible world of articulate sounds and visible written symbols that
others can understand.86 (Citations omitted)
There is no one legal definition of "idea" in this jurisdiction. The term "idea" is
mentioned only once in the Intellectual Property Code.87 In Joaquin, Jr. v. Drilon,88 a
television format (i.e., a dating show format) is not copyrightable under Section 2 of
Presidential Decree No. 49;89 it is a mere concept:chanroblesvirtuallawlibrary
P.D. No. 49, §2, in enumerating what are subject to copyright, refers to finished works
and not to concepts. 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. Thus, the new
INTELLECTUAL PROPERTY CODE OF THE PHILIPPINES
provides:chanroblesvirtuallawlibrary
SEC. 175. Unprotected Subject Matter.—Notwithstanding the provisions of Sections 172
and 173, no protection shall extend, under this law, to any idea, procedure, system,
method or operation, concept, principle, discovery or mere data as such, even if they
are expressed, explained, illustrated or embodied in a work; news of the day and other
miscellaneous facts having the character of mere items of press information; or any
official text of a legislative, administrative or legal nature, as well as any official
translation thereof.
What then is the subject matter of petitioners' copyright? This Court is of the opinion
that petitioner BJPFs copyright covers audio-visual recordings of each episode of Rhoda
and Me, as falling within the class of works mentioned in P.D. 49, §2(M),  to
wit:chanroblesvirtuallawlibrary
Cinematographic works and works produced by a process analogous to cinematography
or any process for making audio-visual recordings;
The copyright does not extend to the general concept or format of its dating game
show.Accordingly, by the very nature of the subject of petitioner BJPI's copyright, the
investigating prosecutor should have the opportunity to compare the videotapes of the
two shows.
Mere description by words of the general format of the two dating game shows is
insufficient; the presentation of the master videotape in evidence was indispensable to
the determination of the existence of probable cause. As aptly observed by respondent
Secretary of Justice:
A television show includes more than mere words can describe because it involves a
whole spectrum of visuals and effects, video and audio, such that no similarity or
dissimilarity may be found by merely describing the general copyright/format of both
dating game shows90 (Emphasis supplied, citations omitted)
Ideas can be either abstract or concrete.91 It is the concrete ideas that are generally
referred to as expression:chanroblesvirtuallawlibrary
The words "abstract" and "concrete" arise in many cases dealing with  the 
idea/expression distinction.  The Nichols court, for example, found that the defendant's
film did not infringe the plaintiffs play because it was "too generalized an abstraction
from what plaintiff wrote . . . only a part of her ideas." In Eichel v. Marcin, the court said
that authors may exploit facts, experiences, field of thought, and general ideas found in
another's work, "provided they do not substantially copy a concrete form, in which the
circumstances and ideas have been developed, arranged, and put into shape." Judge
Hand, in National Comics Publications, Inc. v. Fawcett Publications, Inc. said that "no one
infringes, unless he descends so far into what is concrete as to invade. . . 'expression.'"
These cases seem to be distinguishing "abstract" ideas from "concrete" tangible
embodiments of these abstractions that may be termed expression. However, if the
concrete form of a work means more than the literal expression contained within it, it is
difficult to determine what is meant by "concrete." Webster's New Twentieth Century
Dictionary of the English Language provides several meanings for the word concrete.
These include: "having a material, perceptible existence; of, belonging to, or
characterized by things or events that can be perceived by the senses; real; actual;" and
"referring to a particular; specific, not general or abstract."92
In Pearl & Dean (Phil.), Incorporated v. Shoemart, Incorporated, 93 this court, citing the
American case of Baker v. Selden,  distinguished copyright from patents and illustrated
how an idea or concept is different from the expression of that
idea:chanroblesvirtuallawlibrary
In the oft-cited case of Baker vs. Selden, the United States Supreme Court held that only
the expression of an idea is protected by copyright, not the idea itself. In that case, the
plaintiff held the copyright of a book which expounded on a new accounting system he
had developed. The publication illustrated blank forms of ledgers utilized in such a
system. The defendant reproduced forms similar to those illustrated in the plaintiffs
copyrighted book. The US Supreme Court ruled that:chanroblesvirtuallawlibrary
"There is no doubt that a work on the subject of book-keeping, though only explanatory
of well known systems, may be the subject of a copyright; but, then, it is claimed only as
a book, x x x But there is a clear distinction between the books, as such, and the art,
which it is, intended to illustrate. The mere statement of the proposition is so evident
that it requires hardly any argument to support ii. The same distinction may be
predicated of every other art as well as that of bookkeeping.
A treatise on the composition and use of medicines, be they old or new; on the
construction and use of ploughs or watches or churns; or on the mixture and application
of colors for painting or dyeing; or on the mode of drawing lines to produce the effect of
perspective, would be the subject of copyright; but no one would contend that the
copyright of the treatise would give the exclusive right to the art or manufacture
described therein. The copyright of the book, if not pirated from other works, would be
valid without regard to the novelty or want of novelty of its subject matter. The novelty
of the art or thing described or explained has nothing to do with the validity of the
copyright. To give to the author of the book an exclusive property in the art described
therein, when no examination of its novelty has ever been officially made, would be a
surprise and a fraud upon the public. That is the province of letters patent, not of
copyright. The claim to an invention of discovery of an art or manufacture must be
subjected to the examination of the Patent Office before an exclusive right therein can
be obtained; and a patent from the government can only secure it.
The difference between the two things, letters patent and copyright, may be illustrated
by reference to the subjects just enumerated. Take the case of medicines. Certain
mixtures are found to be of great value in the healing art. If the discoverer writes and
publishes a book on the subject (as regular physicians generally do), he gains no
exclusive right to the manufacture and sale of the medicine; he gives that to the public.
If he desires to acquire such exclusive right, he must obtain a patent for the mixture as a
new art, manufacture or composition of matter. He may copyright his book, if he
pleases; but that only secures to him the exclusive right of printing and publishing his
book. So of all other inventions or discoveries.
The copyright of a book on perspective, no matter how many drawings and illustrations
it may contain, gives no exclusive right to the modes of drawing described, though they
may never have been known or used before. By publishing the book without getting a
patent for the art, the latter is given to the public.
.    .    .    .
Now, whilst no one has a right to print or publish his book or any material part thereof,
as a hook intended to convey instruction in the art, any person may practice and use the,
art itself which he has described and illustrated therein. The use of the art is a totally
different thing from a publication of the book, explaining it. The copyright of a book on
bookkeeping cannot secure the exclusive right to make, sell and use account books
prepared upon the plan set forth in such book. Whether the art might or might not have
been patented, is a question, which is not before us.  It was not patented, and is open
and free to the use of the public. And, of course, in using the art, the ruled lines and
headings of accounts must necessarily be used as incident to it.
The plausibility of the claim put forward by the complainant in this case arises from a
confusion of ideas produced by the peculiar nature of the art described in the books,
which have been made the subject of copyright. In describing the art, the illustrations
and diagrams employed happened to correspond more closely than usual with the
actual work performed by the operator who uses the art. x x x The description of the art
in a book, though entitled to the benefit of copyright, lays no foundation for an exclusive
claim to the art itself. The object of the one is explanation; the object of the other is use.
The former may be secured by copyright. The latter can only be secured, if it can be
secured at all, by letters patent."94 (Emphasis supplied)
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.
In the United States, a line of cases dwelt on the possibility of television newscasts to be
copyrighted.97Most of these cases focused on private individuals' sale or resale of tapes
of news broadcasts. Conflicting decisions were rendered by its courts. Noteworthy,
however, is the District Court's pronouncement in Pacific & Southern Co. v.
Duncan,98 which involves a News Monitoring Service's videotaping and sale of WXIA-TVs
news broadcasts:chanroblesvirtuallawlibrary
It is axiomatic that copyright protection does not extend to news "events" or the facts
or ideas which are the subject of news reports. Miller v. Universal City Studios, Inc., 650
F.2d 1365, 1368 (5th Cir. 1981); Wainwright Securities, Inc. v. Wall Street Transcript
Corp., 558 F.2d 91, 95 (2d Cir. 1977), cert, denied, 434 U.S. 1014, 98 S.Ct. 730, 54 L.Ed.2d
759 (1978). But 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.  Wainwright, 558 F.2d at 95; International News Service v. Associated
Press, 248 U.S. 215, 39 S.Ct. 68, 63 L.Ed. 211 (1918); see Chicago Record-Herald Co. v.
Tribune Assn.,  275 F. 797 (7th Cir.1921); 1 Nimmer on Copyright § 2.11[B]
(1983). Copyright protects the manner of expression of news reports, "the particular
form or collocation of words in which the writer has communicated it"  International
News Service, 248 U.S. at 234, 39 S.Ct. at 70. Such protection extends to electronic news
reports as well as written reports. See 17 U.S.C. § 102(a) (5), (6), and (7);  see also Iowa
State University Research Foundations, Inc. v. American Broadcasting Cos., 621 F.2d 57,
61 (2d Cir. 1980)." (Emphasis supplied)
The idea/expression dichotomy has long been subject to debate in the field of copyright
law. Abolishing the dichotomy has been proposed, in that non-protectibility of ideas
should be re-examined, if not stricken, from decisions and the
law:chanroblesvirtuallawlibrary
If the underlying purpose of the copyright law is the dual one expressed by Lord
Mansfield, the only excuse for the continuance of the idea-expression test as a judicial
standard for determining protectibility would be that it was or could be a truly useful
method of determining the proper balance between the creator's right to profit from his
work and the public's right that the "progress of the arts not be retarded."
other forms of transfer of ownership;
177.4. Rental of the original or a copy of an audiovisual or cinematographic work, a
work embodied in a sound recording, a computer program, a compilation of data
and other materials or a musical work in graphic form, irrespective of the
ownership of the original or the copy which is the subject of the rental; (n)

 
. . . [A]s used in the present-day context[,] the dichotomy has little or no relationship to
the policy which it should effectuate. Indeed, all too often the sweeping language of the 177.5. Public display of the original or a copy of the work;
courts regarding the nonprotectibility of ideas gives the impression that this is of itself a
policy of the law, instead of merely a clumsy and outdated tool to achieve a much more  
basic end.100
177.6. Public performance of the work; and
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 177.7. Other communication to the public of the work. (Sec. 5, P. D. No. 49a) (Emphasis
author's book involving the same characters and setting. In this case, however, supplied)
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 Under Section 211 of the Intellectual Property Code, broadcasting organizations are
footage to any editing of their own. The news footage did not undergo any granted a more specific set of rights called related or neighboring
transformation where there is a need to track elements of the original. rights:chanroblesvirtuallawlibrary

SECTION 211. Scope of Right. — Subject to the provisions of Section 212, broadcasting

Having established the protectible nature of news footage, we now discuss the
organizations shall enjoy the exclusive right to carry out, authorize or prevent any of the
concomitant rights accorded to authors. The authors of a work are granted several
following acts:
rights in relation to it, including copyright or economic rights:chanroblesvirtuallawlibrary
211.1. The rebroadcasting of their broadcasts;
SECTION 177. Copyright or Economic Rights. — Subject to the provisions of Chapter VIII,
copyright or economic rights shall consist of the exclusive right to carry out, authorize or  
prevent the following acts:chanroblesvirtuallawlibrary
211.2. The recording in any manner, including the making of films or the use of video
177.1. Reproduction of the work or substantial portion of the work; tape, of their broadcasts for the purpose of communication to the public of
television broadcasts of the same; and
 
 
177.2. Dramatization, translation, adaptation, abridgment, arrangement or other
transformation of the work; 211.3. The use of such records for fresh transmissions or for fresh recording. (Sec. 52,
P.D. No. 49) (Emphasis supplied)
 
Section 212 of the Code provides:
177.3. The first public distribution of the original and each copy of the work by sale or
CHAPTER XV
LIMITATIONS ON PROTECTION
Section 212. Limitations on Rights. - Sections 203, 208 and 209 shall not apply where the
acts referred to in those Sections are related to:chanroblesvirtuallawlibrary
212.1. The use by a natural person exclusively for his own personal purposes;
212.2. Using short excerpts for reporting current events;
212.3. Use solely for the purpose of teaching or for scientific research; and
212.4. Fair use of the broadcast subject to the conditions under Section 185. (Sec. 44,
P.D. No. 49a)
The Code defines what broadcasting is and who broadcasting organizations
include:chanroblesvirtuallawlibrary
202.7. "Broadcasting" means 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;
202.8. "Broadcasting organization" shall include a natural person or a juridical entity
duly authorized to engage in broadcasting[.]
Developments in technology, including the process of preserving once ephemeral works
and disseminating them, resulted in the need to provide a new kind of protection as
distinguished from copyright.102 The designation "neighboring rights" was abbreviated
from the phrase "rights neighboring to copyright."103  Neighboring or related rights are
of equal importance with copyright as established in the different conventions covering
both kinds of rights.104
Several treaties deal with neighboring or related rights of copyright.105 The most
prominent of these is the "International Convention for the Protection of Performers,
Producers of Phonograms and Broadcasting Organizations" (Rome Convention).106
The Rome Convention protects the rights of broadcasting organizations in relation to
their broadcasts. Article XIII of the Rome Convention enumerates the minimum rights
accorded to broadcasting organizations:chanroblesvirtuallawlibrary
Article 13
Minimum Rights for Broadcasting Organizations
Broadcasting organisations shall enjoy the right to authorize or prohibit:
(a) the rebroadcasting of their broadcasts;
(b) the fixation of their broadcasts;
(c) the reproduction:
  (i) of fixations, made without their consent, of their broadcasts;
 
  (ii) of fixations, made in accordance with the provisions of Article 15, of their
broadcasts, if the reproduction is made for purposes different from those
referred to in those provisions;
(d) the communication to the public of their television broadcasts if such
communication is made in places accessible to the public against payment of an
entrance fee; it shall be a matter for the domestic law of the State where protection
of this right is claimed to determine the conditions under which it may be exercised.
With regard to the neighboring rights of a broadcasting organization in this jurisdiction,
this court has discussed the difference between broadcasting and
rebroadcasting:chanroblesvirtuallawlibrary
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."
.     .     .     .
Under the Rome Convention, rebroadcasting 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."107 (Emphasis in the original, citations omitted)
Broadcasting organizations are entitled to several rights and to the protection of these
rights under the Intellectual Property Code. Respondents' argument that the subject
news footage is not copyrightable is erroneous. The Court of Appeals, in its assailed
Decision, correctly recognized the existence of ABS-CBN's copyright over the news
footage:chanroblesvirtuallawlibrary
Surely, private respondent has a copyright of its news coverage. Seemingly, for airing
said video feed, petitioner GMA is liable under the provisions of the Intellectual Property
Code, which was enacted purposely to protect copyright owners from infringement.108
News as expressed in a video footage is entitled to copyright protection.   Broadcasting
organizations have not only copyright on but also neighboring rights over their
broadcasts.  Copyrightability of a work is different from fair use of a work for purposes
of news reporting.cralawlawlibrary
VI
ABS-CBN assails the Court of Appeals' ruling that the footage shown by GMA-7 falls
under the scope of Section 212.2 and 212.4 of the Intellectual Property
Code:chanroblesvirtuallawlibrary
The evidence on record, as well as the discussions above, show that the footage used by
[respondents] could hardly be characterized as a short excerpt, as it was aired over one
and a half minutes.
Furthermore, the footage used does not fall under the contemplation of Section 212.2
of the Intellectual Property Code. A plain reading of the provision would reveal that
copyrighted material referred to in Section 212 are short portions of an artist's
performance under Section 203, or a producer's sound recordings under Sections 208
and 209. Section 212 does not refer to actual use of video footage of another as its own.
.    .    .    .
The Angelo dela Cruz footage does not fall under the rule on Section 212.4 of the
Intellectual Property Code on fair use of the broadcast.
In determining fair use, several factors are considered, including the nature of the
copyrighted work, and the amount and substantiality of the person used in relation to
the copyrighted work as a whole.
In the business of television news reporting, the nature of the copyrighted work or the
video footages, are such that, footage created, must be a novelty to be a good report.
Thus, when the . . . Angelo dela Cruz footage was used by [respondents], the novelty of
the footage was clearly affected.
Moreover, given that a substantial portion of the Angelo dela Cruz footage was utilized
by GMA-7 for its own, its use can hardly be classified as fair use.
Hence, [respondents] could not be considered as having used the Angelo dela Cruz
[footage] following the provisions on fair use.
It is also worthy to note that the Honorable Court of Appeals seem to contradict itself
when it relied on the provisions of fair use in its assailed rulings considering that it found
that the Angelo dela Cruz footage is not copyrightable, given that the fair use
presupposes an existing copyright. Thus, it is apparent that the findings of the
Honorable Court of Appeals are erroneous and based on wrong
assumptions.109 (Underscoring in the original)
On the other hand, respondents counter that GMA-7's use of ABS-CBN's news footage
falls under fair use as defined in the Intellectual Property Code. Respondents, citing the
Court of Appeals Decision, argue that a strong statutory defense negates any finding of
probable cause under the same statute.  The Intellectual Property Code provides that
fair use negates infringement.
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 purposes is not an infringement of copyright. ... In determining whether the use made of
dela Cruz footage is considered a short excerpt of an event's "news" footage and is a work in any particular case is fair use, the factors to be considered shall
covered by fair use.111 include:chanroblesvirtuallawlibrary

Copyright protection is not absolute.112  The Intellectual Property Code provides the a. The purpose and character of the use, including whether such use is of a
limitations on copyright: commercial nature or is for non-profit educational purposes;

CHAPTER VIII b. The nature of the copyrighted work;

LIMITATIONS ON COPYRIGHT
c. The amount and substantiality of the portion used in relation to the
copyrighted work as a whole; and
Section 184. Limitations on Copyright. - 184.1. Notwithstanding the provisions of
d. The effect of the use upon the potential market for or value of the copyrighted
Chapter V, the following acts shall not constitute infringement of copyright:
work.

.     .     .     . Respondents allege that the news footage was only five (5) seconds long, thus falling
under fair use. ABS-CBN belies this contention and argues that the footage aired for two
184.2. The provisions of this section shall be interpreted in such a way as to allow the (2) minutes and 40 seconds.113According to the Court of Appeals, the parties admitted
work to be used in a manner which does not conflict with the normal exploitation of the that only five (5) seconds of the news footage was broadcasted by GMA-7.114
work and does not unreasonably prejudice the right holder's legitimate interests.
This court defined fair use as "a privilege to use the copyrighted material in a reasonable
.     .     .     .cralawlawlibrary manner without the consent of the copyright owner or as copying the theme or ideas
rather than their expression."115Fair use is an exception to the copyright owner's
CHAPTER XV
monopoly of the use of the work to avoid stifling "the very creativity which that law is
LIMITATIONS ON PROTECTION
designed to foster."116
Section 212. Limitations on Rights. - Sections 203, 208 and 209 shall not apply where the
acts referred to in those Sections are related to: 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:

a. The purpose and character of the use, including whether such use is of a
212.2. Using short excerpts for reporting current events;
commercial nature or is for non-profit educational purposes;

212.4. Fair use of the broadcast subject to the conditions under Section 185. (Sec. 44, b. The nature of the copyrighted work;
P.D. No. 49a) (Emphasis supplied)
c. The amount and substantiality of the portion used in relation to the
The determination of what constitutes fair use depends on several factors. Section 185 copyrighted work as a whole; and
of the Intellectual Property Code states:
d. The effect of the use upon the potential market for or value of the copyrighted
SECTION 185. Fair Use of a Copyrighted Work. — work.

185.1. The fair use of a copyrighted work for criticism, comment, news reporting, First, the purpose and character of the use of the copyrighted material must fall under
teaching including multiple copies for classroom use, scholarship, research, and similar 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 structure and nature of broadcasting as a business requires assigned values for each
second of broadcast or airtime. In most cases, broadcasting organizations generate
revenue through sale of time or timeslots to advertisers, which, in turn, is based on
market share: 122ChanRoblesVirtualawlibrary
Once a news broadcast has been transmitted, the broadcast becomes relatively
worthless to the station. In the case of the aerial broadcasters, advertising sales
generate most of the profits derived from news reports. Advertising rates are, in turn,
governed by market share. Market share is determined by the number of people
watching a show at any particular time, relative to total viewers at that time. News is by
nature time-limited, and so re-broadcasts are generally of little worth because they
draw few viewers. Newscasts compete for market share by presenting their news in an
appealing format that will capture a loyal audience. Hence, 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.
Of course, in the real world there are exceptions to this perfect economic view. 
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. First, the local broadcaster is often not affiliated
with a network (hence its need for more comprehensive programming), confining any
possible competition to a small geographical area. Second, the local broadcaster is not
in competition with CNN. Individuals who do not have cable TV (or a satellite dish with
decoder) cannot receive CNN; therefore there is no competition. . . . Third, CNN sells the
right of rebroadcast to the local stations. Ted Turner, owner of CNN, does not have First
Amendment freedom of access argument foremost on his mind. (Else he would give
everyone free cable TV so everyone could get CNN.) He is in the business for a profit.
Giving away resources does not a profit make.123 (Emphasis supplied)
The high value afforded to limited time periods is also seen in other media. In social
media site Instagram, users are allowed to post up to only 15 seconds of video.124 In
short-video sharing website Vine,125 users are allowed a shorter period of six (6) seconds
per post. The mobile application 1 Second Everyday takes it further by capturing and
stitching one (1) second of video footage taken daily over a span of a certain period.126
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.cralawlawlibrary
VII
Respondents cannot invoke the defense of good faith to argue that no probable cause
exists.

Respondents argue that copyright infringement is malum in se, in that "[c]opying alone
is not what is being prohibited, but its injurious effect which consists in the lifting from
the copyright owners' film or materials, that were the result of the latter's creativity,
work and productions and without authority, reproduced, sold and circulated for
commercial use to the detriment of the latter."127
Infringement under the Intellectual Property Code is malum prohibitum. The Intellectual
Property Code is a special law. Copyright is a statutory
creation:chanroblesvirtuallawlibrary
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 the statute. Being a statutory grant, the rights are only such as the statute confers,
and may be obtained and enjoyed only with respect to the subjects and by the persons,
and on terms and conditions specified in the statute.128
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."130
In contrast, crimes mala in se concern inherently immoral
acts:chanroblesvirtuallawlibrary
Not every criminal act, however, involves moral turpitude. It is for this reason that "as to
what crime involves moral turpitude, is for the Supreme Court to determine". In
resolving the foregoing question, the Court is guided by one of the general rules that
crimes mala in se involve moral turpitude, while crimes mala prohibita do not, the
rationale of which was set forth in "Zari v. Flores" to wit:chanroblesvirtuallawlibrary
It (moral turpitude) implies something immoral in itself, regardless of the fact that it is
punishable by law or not.  It must not be merely mala prohibita, but the act itself must
be inherently immoral. The doing of the act itself, and not its prohibition by statute fixes
the moral turpitude. Moral turpitude does not, however, include such acts as are not of
themselves immoral but whose illegality lies in their being positively prohibited.
(Emphasis supplied)
[These] guidelines nonetheless proved short of providing a clear-cut solution, for
in International Rice Research Institute v. NLRC, the Court admitted that it cannot always
be ascertained whether moral turpitude does or does not exist by merely classifying a
crime as malum in se or as malum prohibitum. There are crimes which are mala in se
and yet but rarely involve moral turpitude and there are crimes which involve moral
turpitude and are mala prohibita only. In the final analysis, whether or not a crime
involves moral turpitude is ultimately a question of fact and frequently depends on all
the circumstances surrounding the violation of the statue.131 (Emphasis in the original)
"Implicit in the concept of mala in se is that of mens rea."132Mens rea is defined as "the
nonphysical element which, combined with the act of the accused, makes up the crime
charged. Most frequently it is the criminal intent, or the guilty mind[.]"133
Crimes mala in se presuppose that the person who did the felonious act had criminal
intent to do so, while crimes mala prohibita do not require knowledge or criminal
intent:chanroblesvirtuallawlibrary
In the case of mala in se it is necessary, to constitute a punishable offense, for the person
doing the act to have knowledge of the nature of his act and to have a criminal intent; in
the case of mala prohibita, unless such words as "knowingly" and "willfully" are
contained in the statute, neither knowledge nor criminal intent is necessary. In other
words, a person morally quite innocent and with every intention of being a law-abiding
citizen becomes a criminal, and liable to criminal penaltes, if he does an act prohibited
by these statutes.134(Emphasis supplied)
Hence, "[i]ntent to commit the crime and intent to perpetrate the act must be
distinguished. A person may not have consciously intended to commit a crime; but he
did intend to commit an act, and that act is, by the very nature of things, the crime
itself[.]"135 When an act is prohibited by a special law, it is considered injurious to public
welfare, and the performance of the prohibited act is the crime itself.136
Volition, or intent to commit the act, is different from criminal intent. Volition or
voluntariness refers to knowledge of the act being done. On the other hand, criminal
intent — which is different from motive, or the moving power for the commission of the
crime137 — refers to the state of mind beyond voluntariness. It is this intent that is being
punished by crimes mala in se.
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.138
In Canada, criminal offenses are categorized under three (3) kinds: "the full mens rea
offence, meaning the accused's actual or subjective state of mind has to be
proved; strict liability offences where no mens rea has to be proved but the accused can
avoid liability if he can prove he took all reasonable steps to avoid the particular event;
[and] absolute liability offences where Parliament has made it clear that guilt follows
proof of the prescribed act only."139 Because of the use of the word "knowingly" in
Canada's Copyright Act, it has been held that copyright infringement is a full mens
rea offense.140
In the United States, willful intent is required for criminal copyright
infringement.141 Before the passage of the No Electronic Theft Act, "civil copyright
infringements were violations of criminal copyright laws only if a defendant willfully
infringed a copyright  'for purposes  of commercial  advantage or private financial
gain.'"142  However, the No Electronic Theft Act now allows criminal copyright
infringement without the requirement of commercial gain. The infringing act may or
may not be for profit.143
There is a difference, however, between the required liability in civil copyright
infringement and that in criminal copyright infringement in the United States. Civil
copyright infringement does not require culpability and employs a strict liability
regime144 where "lack of intention to infringe is not a defense to an action for
infringement."145
In the Philippines, the Intellectual Property Code, as amended, provides for the
prosecution of criminal actions for the following violations of intellectual property
rights: Repetition of Infringement of Patent (Section 84); Utility Model (Section 108);
Industrial Design (Section 119); Trademark Infringement (Section 155 in relation to
Section 170); Unfair Competition (Section 168 in relation to Section 170); False
Designations of Origin, False Description or Representation (Section 169.1 in relation to
Section 170); infringement of copyright, moral rights, performers' rights, producers'
rights, and broadcasting rights (Section 177, 193, 203, 208 and 211 in relation to Section
217); and other violations of intellectual property rights as may be defined by law.
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:146ChanRoblesVirtualawlibrary
SECTION 216. Remedies for Infringement. —
b. Pay to the copyright proprietor or his assigns or heirs such actual damages,
including legal costs and other expenses, as he may have incurred due to the
infringement as well as the profits the infringer may have made due to such
infringement, and in proving profits the plaintiff shall be required to prove sales
only and the defendant shall be required   to prove every element of cost which
he claims, or, in lieu of actual damages and profits, such damages which to the
court shall appear to be just and shall not be regarded as penalty.
c. Deliver under oath, for impounding during the pendency of the action, upon
such terms and conditions as the court may  prescribe,  sales invoices and other
documents evidencing sales, all articles and their packaging alleged to infringe
a copyright and implements for making them.
d. Deliver under oath for destruction without any compensation all infringing
copies or devices, as well as all plates, molds, or other means for making such
infringing copies as the court may order.
e. Such other terms and conditions, including the payment of moral   and
exemplary damages, which the court may deem proper, wise and equitable and
the destruction of infringing copies of the work even in the event of acquittal in
a criminal case.
216.2. In an infringement action, the court shall also have the power to order the
seizure and impounding of any article which may serve as evidence in the court
proceedings. (Sec. 28. P.D. No. 49a)
SECTION 217, Criminal Penalties. —
217.1. Any person infringing any right secured by provisions of Part IV of this Act or
aiding or abetting such infringement shall be guilty of a crime punishable by:
a. Imprisonment of one (1) year to three (3) years plus a fine ranging from Fifty
thousand pesos (P50,000) to One hundred fifty thousand pesos (P150,000) for
the first offense.

b.
216.1. Any person infringing a right protected under this law shall be liable:
a. To an injunction restraining such infringement.  The court may also order the
defendant to desist from an infringement, among others, to prevent the entry
c.
into the channels of commerce of imported goods that involve an infringement,
immediately after customs clearance of such goods.
Imprisonment of three (3) years and one (1) day to six (6) years plus a fine
ranging from One hundred fifty thousand pesos (P150,000) to Five hundred
thousand pesos (P500,000) for the second offense.
Imprisonment of six (6) years and one (1) day to nine (9) years plus a fine
ranging from Five hundred  thousand pesos (P500,000) to One million five
hundred thousand pesos (P1,500,000) for the third and   subsequent offenses.
 d. In all cases, subsidiary imprisonment in cases of insolvency.
217.2. In determining the number of years of imprisonment and the amount of fine, the
court shall consider the value of the infringing materials that the defendant has
produced or manufactured and the damage that the copyright owner has suffered by
reason of the infringement.
217.3. Any person who at the time when copyright subsists in a work has in his
possession an article which he knows, or ought to know, to be an infringing copy of the
work for the purpose of:
a. Selling, letting for hire, or by way of trade offering or exposing for sale, or hire,
the article;
b. Distributing the article for purpose of trade, or for any other purpose to an
extent that will prejudice the rights of the copyright owner in the work; or
c. Trade exhibit of the article in public, shall be guilty of an offense and shall be
liable on conviction to imprisonment and fine as above mentioned. (Sec. 29,
P.D. No. 49a) (Emphasis supplied)
The law is clear. Inasmuch as there is wisdom in prioritizing the flow and exchange of
ideas as opposed to rewarding the creator, it is the plain reading of the law in
conjunction with the actions of the legislature to which we defer. We have continuously
"recognized the power of the legislature . . . to forbid certain acts in a limited class of
cases and to make their commission criminal without regard to the intent of the doer.
Such legislative enactments are based on the experience that repressive measures
which depend for their efficiency upon proof of the dealer's knowledge or of his intent
are of little use and rarely accomplish their purposes."147
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:chanroblesvirtuallawlibrary
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. This specially obtains in
the Angelo dela Cruz news footage which GMA-7 received from Reuters and CNN.
Reuters and CNN were beaming live videos from the coverage which GMA-7 received as
a subscriber and, in the exercise of its rights as a subscriber, GMA-7 picked up the live
video and simultaneously re-broadcast it. In simultaneously broadcasting the live video
footage of Reuters, GMA-7 did not copy the video footage of petitioner ABS-
CBN[.]148 (Emphasis in the original)
Respondents' arguments must fail.
Respondents are involved and experienced in the broadcasting business. They knew that
there would be consequences in carrying A.BS-CBN's footage in their broadcast. That is
why GMA-7 allegedly cut the feed from Reuters upon seeing ABS-CBN's logo and
reporter. 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.149
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:chanroblesvirtuallawlibrary
The essence of intellectual piracy should be essayed in conceptual terms in order to
underscore its gravity by an appropriate understanding thereof. Infringement of a
copyright is a trespass on a private domain owned and occupied by the owner of the
copyright, and, therefore, protected by law, and infringement of copyright, or piracy,
which is a synonymous term in this connection, consists in the doing by any person,
without the consent of the owner of the copyright, of anything the sole right to do
which is conferred by statute on the owner of the copyright.
.    .    .    .
A copy of a piracy is an infringement of the original, and  it is no defense that the pirate,
in such cases, did not know whether or not he was infringing any copyright; he at least
knew that what he was copying was not his, and he copied at his peril.
.    .    .    .
In cases of infringement, copying alone is not what is prohibited. The copying must
produce an "injurious effect". Here, the injury consists in that respondent Robles lifted
from petitioners' book materials that were the result of the latter's research work and
compilation and misrepresented them as her own. She circulated the book DEP for
commercial use and did not acknowledge petitioners as her source.152 (Emphasis
supplied)
Habana and Columbia Pictures did not require knowledge of the infringement to
constitute a violation of the copyright. One does not need to know that he or she is
copying a work without consent to violate copyright law. Notice of fact of the embargo
from Reuters or CNN is not material to find probable cause that respondents committed
infringement. Knowledge of infringement is only material when the person is charged of
aiding and abetting a copyright infringement under Section 217 of the Intellectual
Property Code.153
We look at the purpose of copyright in relation to criminal prosecutions requiring
willfulness:chanroblesvirtuallawlibrary
Most importantly, in defining the contours of what it means to willfully infringe
copyright for purposes of criminal liability, the courts should remember the ultimate aim
of copyright. Copyright is not primarily about providing the strongest possible protection
for copyright owners so that they have the highest possible incentive to create more
works. The control given to copyright owners is only a means to an end: the promotion
of knowledge and learning. Achieving that underlying goal of copyright law also requires
access to copyrighted works and it requires permitting certain kinds of uses of
copyrighted works without the permission of the copyright owner. While a particular
defendant may appear to be deserving of criminal sanctions, the standard for
determining willfulness should be set with reference to the larger goals of copyright
embodied in the Constitution and the history of copyright in this country.154
In addition, "[t]he essence of intellectual piracy should be essayed in conceptual terms
in order to underscore its gravity by an appropriate understanding thereof. Infringement
of a copyright is a trespass on a private domain owned and occupied by the owner of
the copyright, and, therefore, protected by law, and infringement of copyright, or
piracy, which is a synonymous term in this connection, consists in the doing by any
person, without the consent of the owner of the copyright, of anything the sole right to
do which is conferred by statute on the owner of the copyright."155
Intellectual property rights, such as copyright and the neighboring right against
rebroadcasting, establish an artificial and limited monopoly to reward creativity.
Without these legally enforceable rights, creators will have extreme difficulty recovering
their costs and capturing the surplus or profit of their works as reflected in their
markets. This, in turn, is based on the theory that the possibility of gain due to creative
work creates an incentive which may improve efficiency or simply enhance consumer
welfare or utility. More creativity redounds to the public good.
These, however, depend on the certainty of enforcement. Creativity, by its very nature,
is vulnerable to the free rider problem. It is easily replicated despite the costs to and
efforts of the original creator. The more useful the creation is in the market, the greater
the propensity that it will be copied. The most creative and inventive individuals are
usually those who are unable to recover on their creations.
Arguments against strict liability presuppose that the Philippines has a social, historical,
and economic climate similar to those of Western jurisdictions. As it stands, there is a
current need to strengthen intellectual property protection.
Thus, unless clearly provided in the law, offenses involving infringement of copyright
protections should be considered malum prohibitum. It is the act of infringement, not
the intent, which causes the damage. To require or assume the need to prove intent
defeats the purpose of intellectual property protection.
Nevertheless, proof beyond reasonable doubt is still the standard for criminal
prosecutions under the Intellectual Property Code.cralawlawlibrary
VIII
Respondents argue that GMA-7's officers and employees cannot be held liable for
infringement under the Intellectual Property Code since it does not expressly provide
direct liability of the corporate officers. They explain that "(i) a corporation may be
charged and prosecuted for a crime where the penalty is fine or both imprisonment and
fine, and if found guilty, may be fined; or (ii) a corporation may commit a crime but if
the statute prescribes the penalty therefore to be suffered by the corporate officers,
directors or employees or other persons, the latter shall be responsible for the
offense."156
Section 217 of the Intellectual Property Code states that "any person" may be found
guilty of infringement. It also imposes the penalty of both imprisonment and
fine:chanroblesvirtuallawlibrary
Section 217. Criminal Penalties. - 217.1. Any person infringing any right secured by
provisions of Part IV of this Act or aiding or abetting such infringement shall be guilty of
a crime punishable by:
(a) Imprisonment of one (1) year to three (3) years plus a fine ranging from Fifty
thousand pesos (P50,000) to One hundred fifty thousand pesos (P150,000) for the
first offense.
 
(b) Imprisonment of three (3) years and one (1) day to six (6) years plus a fine ranging
from One hundred fifty thousand pesos (P150,000) to Five hundred thousand pesos
(P500,000) for the second offense.
 
(c) Imprisonment of six (6) years and one (1) day to nine (9) years plus a fine ranging
from five hundred thousand pesos (P500,000) to One million five hundred
thousand pesos (P1,500,000) for the third and subsequent offenses.
(d) In all cases, subsidiary imprisonment in cases of insolvency. (Emphasis supplied)
Corporations have separate and distinct personalities from their officers or
directors.157 This court has ruled that corporate officers and/or agents may be held
individually liable for a crime committed under the Intellectual Property
Code:158ChanRoblesVirtualawlibrary
Petitioners, being corporate officers and/or directors, through whose act, default or
omission the corporation commits a crime, may themselves be individually held
answerable for the crime. . . . The existence of the corporate entity does not shield from
prosecution the corporate agent who knowingly and intentionally caused the
corporation to commit a crime. Thus, petitioners cannot hide behind the cloak of the
separate corporate personality of the corporation to escape criminal liability. A
corporate officer cannot protect himself behind a corporation where he is the actual,
present and efficient actor.159
However, the criminal liability of a. corporation's officers or employees stems from their
active participation in the commission of the wrongful act:chanroblesvirtuallawlibrary
The principle applies whether or not the crime requires the consciousness of
wrongdoing. It applies to those corporate agents who themselves commit the crime and
to those, who, by virtue of their managerial positions or other similar relation to the
corporation, could be deemed responsible for its commission, if by virtue of their
relationship to the corporation, they had the power to prevent the act. Moreover, all
parties active in promoting a crime, whether agents or not, are principals. Whether such
officers or employees are benefited by their delictual acts is not a touchstone of their
criminal liability. Benefit is not an operative fact. 160 (Emphasis supplied)
An accused's participation in criminal acts involving violations of intellectual property
rights is the subject of allegation and proof. The showing that the accused did the acts or
contributed in a meaningful way in the commission of the infringements is certainly
different from the argument of lack of intent or good faith. Active participation requires
a showing of overt physical acts or intention to commit such acts. Intent or good faith,
on the other hand, are inferences from acts proven to have been or not been
committed.
We find that the Department of Justice committed grave abuse of discretion when it
resolved to file the Information against respondents despite lack of proof of their actual
participation in the alleged crime.
Ordering the inclusion of respondents Gozon, GMA-7 President; Duavit, Jr., Executive
Vice-President; Flores, Vice-President for News and Public Affairs; and Soho, Director for
News, as respondents, Secretary Agra overturned the City Prosecutor's finding that only
respondents Dela Peña-Reyes and Manalastas are responsible for the crime charged due
to their duties.161 The Agra Resolution reads:chanroblesvirtuallawlibrary
Thus, from the very nature of the offense and the penalty involved, it is necessary that
GMA-7's directors, officers, employees or other officers thereof responsible for the
offense shall be charged and penalized for violation of the Sections 177 and 211 of
Republic Act No. 8293. In their complaint for libel, respondents Felipe L Gozon, Gilberto
R. Duavit, Jr., Marissa L. Flores, Jessica A. Soho, Grace Dela Pena-Reyes, John Oliver T.
Manalastas felt they were aggrieved because they were "in charge of the management,
operations and production of news and public affairs programs of the network" (GMA-
7). This is clearly an admission on respondents' part. Of course, respondents may argue
they have no intention to infringe the copyright of ABS-CBN; that they acted in good
faith; and that they did not directly cause the airing of the subject footage, but again this
is preliminary investigation and what is required is simply probable cause. Besides, these
contentions can best be addressed in the course of trial.162 (Citation omitted)
In contrast, the Office of the City Prosecutor, in the Resolution dated December 3, 2004,
found that respondents Gozon, Duavit, Jr., Flores, and Soho did not have active
participation in the commission of the crime charged:chanroblesvirtuallawlibrary
This Office, however, does not subscribe to the view that respondents Atty. Felipe
Gozon, Gilberto Duavit, Marissa Flores and Jessica Soho should be held liable for the
said offense. Complainant failed to present clear and convincing evidence that the said
respondents conspired with Reyes and Manalastas. No evidence was adduced to prove
that these respondents had an active participation in the actual commission of the
copyright infringement or they exercised their moral ascendancy over Reyes and
Manalastas in airing the said footage. It must be stressed that, conspiracy must be
established by positive and conclusive evidence. It must be shown to exist as clearly and
convincingly as the commission of the offense itself.163 (Emphasis supplied, citations
omitted)
The City Prosecutor found respondents Dela Peña-Reyes and Manalastas liable due to
the nature of their work and responsibilities. He found that:chanroblesvirtuallawlibrary
[t]his Office however finds respondents Grace Déla Peña-Reyes and John Oliver T.
Manalastas liable for copyright infringement penalized under Republic Act No. 8293. It is
undisputed that complainant ABS-CBN holds the exclusive ownership and copyright over
the "Angelo [d]ela Cruz news footage". Hence, any airing and re-broadcast of the said
footage without any consent and authority from ABS-CBN will be held as an
infringement and violation of the intellectual property rights of the latter. Respondents
Grace Dela Peña-Reyes as the Head of the News Operation and John Oliver T.
Manalastas as the Program Manager cannot escape liability since the news control
room was under their direct control and supervision. Clearly, they must have been aware
that the said footage coming from Reuters or CNN has a "No Access Philippines"
advisory or embargo thus cannot be re-broadcast. We find no merit to the defense of
ignorance interposed by the respondents. It is simply contrary to human experience and
logic that experienced employees of an established broadcasting network would be
remiss in their duty in ascertaining if the said footage has an embargo. 164 (Emphasis
supplied)
We agree with the findings as to respondents Dela Peña-Reyes and Manalastas. Both
respondents committed acts that promoted infringement of ABS-CBN's footage. We
note that embargoes are common occurrences in and between news agencies and/or
broadcast organizations.165  Under its Operations Guide, Reuters has two (2) types of
embargoes: transmission embargo and publication embargo.166Under ABS-CBN's service
contract with Reuters, Reuters will embargo any content contributed by ABS-CBN from
other broadcast subscribers within the same geographical
location:chanroblesvirtuallawlibrary
4a. Contributed Content
You agree to supply us at our request with news and sports news stones broadcast on
the Client Service of up to three (3) minutes each for use in our Services on a non-
exclusive basis and at a cost of US$300.00 (Three Hundred United States Dollars) per
story. In respect of such items we agree to embargo them against use by other
broadcast subscribers in the Territory and confirm we will observe all other conditions of
usage regarding Contributed Content, as specified in Section 2.5 of the Reuters Business
Principles for Television Services. For the purposes of clarification, any geographical
restriction imposed by you on your use of Contributed Content will not prevent us or
our clients from including such Contributed Content in online transmission services
including the internet. We acknowledge Contributed Content is your copyright and we
will not acquire any intellectual property rights in the Contributed Content.167 (Emphasis
supplied)
Respondents Dela Peña-Reyes and Manalastas merely denied receiving the advisory
sent by Reuters to its clients, including GMA-7. As in the records, the advisory
reads:chanroblesvirtuallawlibrary
ADVISORY - - +++LIVE COVER PLANS+++
PHILIPPINES: HOSTAGE RETURN
* *ATTENTION ALL CLIENTS**
PLEASE BE ADVISED OF THE FOLLOWING LIVE COVER PLANNED FOR THURSDAY, JULY 22:
.     .     .     .
SOURCE: ABS-CBN
TV AND WEB RESTRICTIONS: NO ACCESS PHILIPPINES.168
There is probable cause that respondents Dela Peña-Reyes and Manalastas directly
committed copyright infringement of ABS-CBN's news footage to warrant piercing of the
corporate veil. They are responsible in airing the embargoed Angelo dela Cruz footage.
They could have prevented the act of infringement had they been diligent in their
functions as Head of News Operations and Program Manager.
Secretary Agra, however, committed grave abuse of discretion when he ordered the
filing of the Information against all respondents despite the erroneous piercing of the
corporate veil. Respondents Gozon, Duavit, Jr., Flores, and Soho cannot be held liable
for the criminal liability of the corporation.
Mere membership in the Board or being President per se does not mean knowledge,
approval, and participation in the act alleged as criminal. There must be a showing of
active participation, not simply a constructive one.
Under principles of criminal law, the principals of a crime are those "who take a direct
part in the execution of the act; [t]hose who directly force or induce others to commit it;
[or] [t]hose who cooperate in the commission of the offense by another act without
which it would not have been accomplished."169There is conspiracy "when two or more
persons come to an agreement concerning the commission of a felony and decide to
commit it":170ChanRoblesVirtualawlibrary
Conspiracy is not presumed. Like the physical acts constituting the crime itself, the
elements of conspiracy must be proven beyond reasonable doubt. While conspiracy
need not be established by direct evidence, for it may be inferred from the conduct of
the accused before, during and after the commission of the crime, all taken together,
however, the evidence must be strong enough to show the community of criminal
design. For conspiracy to exist, it is essential that there must be a conscious design to
commit an offense. Conspiracy is the product of intentionality on the part of the
cohorts.
It is necessary that a conspirator should have performed some overt act as a direct or
indirect contribution to the execution of the crime committed. The overt act may consist
of active participation in the actual commission of the crime itself or it may consist of
moral assistance to his co-conspirators by being present at the commission of the crime
or by exerting moral ascendancy over the other co-conspirators[.] 171  (Emphasis supplied,
citations omitted)
In sum, the trial court erred in failing to resume the proceedings after the designated
period. The Court of Appeals erred when it held that Secretary Agra committed errors of
jurisdiction despite its own pronouncement that ABS-CBN is the owner of the copyright
on the news footage. News should be differentiated from expression of the news,
particularly when the issue involves rebroadcast of news footage. The Court of Appeals
also erroneously held that good faith, as. well as lack of knowledge of infringement, is a
defense against criminal prosecution for copyright and neighboring rights infringement.
In its current form, the Intellectual Property Code is malum prohibitum and prescribes a
strict liability for copyright infringement. Good faith, lack of knowledge of the copyright,
or lack of intent to infringe is not a defense against copyright infringement. Copyright,
however, is subject to the rules of fair use and will be judged on a case-to-case basis.
Finding probable cause includes a determination of the defendant's active participation,
particularly when the corporate veil is pierced in cases involving a corporation's criminal
liability.cralawred
WHEREFORE, the Petition is partially GRANTED.  The Department of Justice Resolution
dated June 29, 2010 ordering the filing of the Information is hereby REINSTATED as to
respondents Grace Dela Peña-Reyes and John Oliver T. Manalastas. Branch 93 of the
Regional Trial Court of Quezon City is directed to continue with the proceedings in
Criminal Case No. Q-04-131533.
SO ORDERED.
 Carpio, Chairperson, Brion, Del Castillo, and Mendoza, JJ., concur.
G.R. No. 175769-70             January 19, 2009
ABS-CBN BROADCASTING CORPORATION, Petitioners, 
vs.
PHILIPPINE MULTI-MEDIA SYSTEM, INC., CESAR G. REYES, FRANCIS CHUA (ANG BIAO),
MANUEL F. ABELLADA, RAUL B. DE MESA, AND ALOYSIUS M. COLAYCO, Respondents.
DECISION
YNARES-SANTIAGO, J.:
This petition for review on certiorari1 assails the July 12, 2006 Decision2 of the Court of
Appeals in CA-G.R. SP Nos. 88092 and 90762, which affirmed the December 20, 2004
Decision of the Director-General of the Intellectual Property Office (IPO) in Appeal No.
10-2004-0002. Also assailed is the December 11, 2006 Resolution3 denying the motion
for reconsideration.
Petitioner ABS-CBN Broadcasting Corporation (ABS-CBN) is licensed under the laws of
the Republic of the Philippines to engage in television and radio broadcasting.4 It
broadcasts television programs by wireless means to Metro Manila and nearby
provinces, and by satellite to provincial stations through Channel 2 on Very High
Frequency (VHF) and Channel 23 on Ultra High Frequency (UHF). The programs aired
over Channels 2 and 23 are either produced by ABS-CBN or purchased from or licensed
by other producers.
ABS-CBN also owns regional television stations which pattern their programming in
accordance with perceived demands of the region. Thus, television programs shown in
Metro Manila and nearby provinces are not necessarily shown in other provinces.
Respondent Philippine Multi-Media System, Inc. (PMSI) is the operator of Dream
Broadcasting System. It delivers digital direct-to-home (DTH) television via satellite to its
subscribers all over the Philippines. Herein individual respondents, Cesar G. Reyes,
Francis Chua, Manuel F. Abellada, Raul B. De Mesa, and Aloysius M. Colayco, are
members of PMSI’s Board of Directors.
5
PMSI was granted a legislative franchise under Republic Act No. 8630  on May 7, 1998
and was given a Provisional Authority by the National Telecommunications Commission
(NTC) on February 1, 2000 to install, operate and maintain a nationwide DTH satellite
service. When it commenced operations, it offered as part of its program line-up ABS-
CBN Channels 2 and 23, NBN, Channel 4, ABC Channel 5, GMA Channel 7, RPN Channel
9, and IBC Channel 13, together with other paid premium program channels.
However, on April 25, 2001,6 ABS-CBN demanded for PMSI to cease and desist from
rebroadcasting Channels 2 and 23. On April 27, 2001,7 PMSI replied that the
rebroadcasting was in accordance with the authority granted it by NTC and its obligation
under NTC Memorandum Circular No. 4-08-88,8 Section 6.2 of which requires all cable
television system operators operating in a community within Grade “A” or “B” contours
to carry the television signals of the authorized television broadcast stations.9
Thereafter, negotiations ensued between the parties in an effort to reach a settlement;
however, the negotiations were terminated on April 4, 2002 by ABS-CBN allegedly due
to PMSI’s inability to ensure the prevention of illegal retransmission and further
rebroadcast of its signals, as well as the adverse effect of the rebroadcasts on the
business operations of its regional television stations.10
On May 13, 2002, ABS-CBN filed with the IPO a complaint for “Violation of Laws
Involving Property Rights, with Prayer for the Issuance of a Temporary Restraining Order
and/or Writ of Preliminary Injunction,” which was docketed as IPV No. 10-2002-0004. It
alleged that PMSI’s unauthorized rebroadcasting of Channels 2 and 23 infringed on its
broadcasting rights and copyright.
On July 2, 2002, the Bureau of Legal Affairs (BLA) of the IPO granted ABS-CBN’s
application for a temporary restraining order. On July 12, 2002, PMSI suspended its
retransmission of Channels 2 and 23 and likewise filed a petition for certiorari with the
Court of Appeals, which was docketed as CA-G.R. SP No. 71597.
Subsequently, PMSI filed with the BLA a Manifestation reiterating that it is subject to the
must-carry rule under Memorandum Circular No. 04-08-88. It also submitted a letter
dated December 20, 2002 of then NTC Commissioner Armi Jane R. Borje to PMSI stating
as follows:
This refers to your letter dated December 16, 2002 requesting for regulatory guidance
from this Commission in connection with the application and coverage of NTC
Memorandum Circular No. 4-08-88, particularly Section 6 thereof, on mandatory
carriage of television broadcast signals, to the direct-to-home (DTH) pay television
services of Philippine Multi-Media System, Inc. (PMSI).
Preliminarily, both DTH pay television and cable television services are broadcast
services, the only difference being the medium of delivering such services (i.e. the
former by satellite and the latter by cable). Both can carry broadcast signals to the
remote areas, thus enriching the lives of the residents thereof through the
dissemination of social, economic, educational information and cultural programs.
The DTH pay television services of PMSI is equipped to provide nationwide DTH satellite
services. Concededly, PMSI’s DTH pay television services covers very much wider areas
in terms of carriage of broadcast signals, including areas not reachable by cable
television services thereby providing a better medium of dissemination of information
to the public.
In view of the foregoing and the spirit and intent of NTC memorandum Circular No. 4-
08-88, particularly section 6 thereof, on mandatory carriage of television broadcast
signals, DTH pay television services should be deemed covered by such NTC
Memorandum Circular.
For your guidance. (Emphasis added)11
On August 26, 2003, PMSI filed another Manifestation with the BLA that it received a
letter dated July 24, 2003 from the NTC enjoining strict and immediate compliance with
the must-carry rule under Memorandum Circular No. 04-08-88, to wit:
Dear Mr. Abellada:
Last July 22, 2003, the National Telecommunications Commission (NTC) received a letter
dated July 17, 2003 from President/COO Rene Q. Bello of the International Broadcasting
Corporation (IBC-Channel 13) complaining that your company, Dream Broadcasting
System, Inc., has cut-off, without any notice or explanation whatsoever, to air the
programs of IBC-13, a free-to-air television, to the detriment of the public.
We were told that, until now, this has been going on.
Please be advised that as a direct broadcast satellite operator, operating a direct-to-
home (DTH) broadcasting system, with a provisional authority (PA) from the NTC, your
company, along with cable television operators, are mandated to strictly comply with
the existing policy of NTC on mandatory carriage of television broadcast signals as
provided under Memorandum Circular No. 04-08-88, also known as the Revised Rules
and Regulations Governing Cable Television System in the Philippines.
This mandatory coverage provision under Section 6.2 of said Memorandum Circular,
requires all cable television system operators, operating in a community within the
Grade “A” or “B” contours to “must-carry” the television signals of the authorized
television broadcast stations, one of which is IBC-13. Said directive equally applies to
your company as the circular was issued to give consumers and the public a wider
access to more sources of news, information, entertainment and other
programs/contents.
This Commission, as the governing agency vested by laws with the jurisdiction,
supervision and control over all public services, which includes direct broadcast satellite
operators, and taking into consideration the paramount interest of the public in general,
hereby directs you to immediately restore the signal of IBC-13 in your network
programs, pursuant to existing circulars and regulations of the Commission.
For strict compliance. (Emphasis added)12
Meanwhile, on October 10, 2003, the NTC issued Memorandum Circular No. 10-10-
2003, entitled “Implementing Rules and Regulations Governing Community
Antenna/Cable Television (CATV) and Direct Broadcast Satellite (DBS) Services to
Promote Competition in the Sector.” Article 6, Section 8 thereof states:
As a general rule, the reception, distribution and/or transmission by any CATV/DBS
operator of any television signals without any agreement with or authorization from
program/content providers are prohibited.
On whether Memorandum Circular No. 10-10-2003 amended Memorandum Circular
No. 04-08-88, the NTC explained to PMSI in a letter dated November 3, 2003 that:
To address your query on whether or not the provisions of MC 10-10-2003 would have
the effect of amending the provisions of MC 4-08-88 on mandatory carriage of television
signals, the answer is in the negative.
xxxx
The Commission maintains that, MC 4-08-88 remains valid, subsisting and enforceable.
Please be advised, therefore, that as duly licensed direct-to-home satellite television
service provider authorized by this Commission, your company continues to be bound
by the guidelines provided for under MC 04-08-88, specifically your obligation under
its mandatory carriage provisions, in addition to your obligations under MC 10-10-
2003. (Emphasis added)
Please be guided accordingly.13
On December 22, 2003, the BLA rendered a decision14 finding that PMSI infringed the
broadcasting rights and copyright of ABS-CBN and ordering it to permanently cease and
desist from rebroadcasting Channels 2 and 23.
On February 6, 2004, PMSI filed an appeal with the Office of the Director-General of the
IPO which was docketed as Appeal No. 10-2004-0002. On December 23, 2004, it also
filed with the Court of Appeals a “Motion to Withdraw Petition; Alternatively,
Memorandum of the Petition for Certiorari” in CA-G.R. SP No. 71597, which was granted
in a resolution dated February 17, 2005.
On December 20, 2004, the Director-General of the IPO rendered a decision15 in favor of
PMSI, the dispositive portion of which states:
WHEREFORE, premises considered, the instant appeal is hereby GRANTED. Accordingly,
Decision No. 2003-01 dated 22 December 2003 of the Director of Bureau of Legal Affairs
is hereby REVERSED and SET ASIDE.
Let a copy of this Decision be furnished the Director of the Bureau of Legal Affairs for
appropriate action, and the records be returned to her for proper disposition. The
Documentation, Information and Technology Transfer Bureau is also given a copy for
library and reference purposes.
SO ORDERED.16
Thus, ABS-CBN filed a petition for review with prayer for issuance of a temporary
restraining order and writ of preliminary injunction with the Court of Appeals, which
was docketed as CA-G.R. SP No. 88092.
On July 18, 2005, the Court of Appeals issued a temporary restraining order. Thereafter,
ABS-CBN filed a petition for contempt against PMSI for continuing to rebroadcast
Channels 2 and 23 despite the restraining order. The case was docketed as CA- G.R. SP
No. 90762.
On November 14, 2005, the Court of Appeals ordered the consolidation of CA-G.R. SP
Nos. 88092 and 90762.
In the assailed Decision dated July 12, 2006, the Court of Appeals sustained the findings
of the Director-General of the IPO and dismissed both petitions filed by ABS-CBN.17
ABS-CBN’s motion for reconsideration was denied, hence, this petition.
ABS-CBN contends that PMSI’s unauthorized rebroadcasting of Channels 2 and 23 is an
infringement of its broadcasting rights and copyright under the Intellectual Property
Code (IP Code);18that Memorandum Circular No. 04-08-88 excludes DTH satellite
television operators; that the Court of Appeals’ interpretation of the must-carry rule
violates Section 9 of Article III19 of the Constitution because it allows the taking of
property for public use without payment of just compensation; that the Court of
Appeals erred in dismissing the petition for contempt docketed as CA-G.R. SP No. 90762
without requiring respondents to file comment.
Respondents, on the other hand, argue that PMSI’s rebroadcasting of Channels 2 and 23
is sanctioned by Memorandum Circular No. 04-08-88; that the must-carry rule under the
Memorandum Circular is a valid exercise of police power; and that the Court of Appeals
correctly dismissed CA-G.R. SP No. 90762 since it found no need to exercise its power of
contempt.
After a careful review of the facts and records of this case, we affirm the findings of the
Director-General of the IPO and the Court of Appeals.
There is no merit in ABS-CBN’s contention that PMSI violated its broadcaster’s rights
under Section 211 of the IP Code which provides in part:
Chapter XIV
BROADCASTING ORGANIZATIONS
Sec. 211. Scope of Right. - Subject to the provisions of Section 212, broadcasting
organizations shall enjoy the exclusive right to carry out, authorize or prevent any of the
following acts:
211.1. The rebroadcasting of their broadcasts;
xxxx
Neither is PMSI guilty of infringement of ABS-CBN’s copyright under Section 177 of the
IP Code which states that copyright or economic rights shall consist of the exclusive right
to carry out, authorize or prevent the public performance of the work (Section 177.6),
and other communication to the public of the work (Section 177.7).20
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, 21 is “the simultaneous broadcasting by one
broadcasting organization of the broadcast of another broadcasting organization.”
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, thus:
That the Appellant’s [herein respondent PMSI] subscribers are able to view Appellee’s
[herein petitioner ABS-CBN] programs (Channels 2 and 23) at the same time that the
latter is broadcasting the same is undisputed. The question however is, would the
Appellant in doing so be considered engaged in broadcasting. Section 202.7 of the IP
Code states that broadcasting means
“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.”
Section 202.7 of the IP Code, thus, provides two instances wherein there is
broadcasting, to wit:
1. The transmission by wireless means for the public reception of sounds or of images or
of representations thereof; and
2. The transmission by satellite for the public reception of sounds or of images or of
representations thereof where the means for decrypting are provided to the public by
the broadcasting organization or with its consent.
It is under the second category that Appellant’s DTH satellite television service must be
examined since it is satellite-based. The elements of such category are as follows:
1. There is transmission of sounds or images or of representations thereof;
2. The transmission is through satellite;
3. The transmission is for public reception; and
4. The means for decrypting are provided to the public by the broadcasting organization
or with its consent.
It is only the presence of all the above elements can a determination that the DTH is
broadcasting and consequently, rebroadcasting Appellee’s signals in violation of
Sections 211 and 177 of the IP Code, may be arrived at.
Accordingly, this Office is of the view that the transmission contemplated under Section
202.7 of the IP Code presupposes that the origin of the signals is the broadcaster.
Hence, a program that is broadcasted is attributed to the broadcaster. In the same
manner, the rebroadcasted program is attributed to the rebroadcaster.
In the case at hand, Appellant is not the origin nor does it claim to be the origin of the
programs broadcasted by the Appellee. Appellant did not make and transmit on its own
but merely carried the existing signals of the Appellee. When Appellant’s subscribers
view Appellee’s programs in Channels 2 and 23, they know that the origin thereof was
the Appellee.
Aptly, it is imperative to discern the nature of broadcasting. When a broadcaster
transmits, the signals are scattered or dispersed in the air. Anybody may pick-up these
signals. There is no restriction as to its number, type or class of recipients. To receive the
signals, one is not required to subscribe or to pay any fee. One only has to have a
receiver, and in case of television signals, a television set, and to tune-in to the right
channel/frequency. The definition of broadcasting, wherein it is required that the
transmission is wireless, all the more supports this discussion. Apparently, the
undiscriminating dispersal of signals in the air is possible only through wireless means.
The use of wire in transmitting signals, such as cable television, limits the recipients to
those who are connected. Unlike wireless transmissions, in wire-based transmissions, it
is not enough that one wants to be connected and possesses the equipment. The
service provider, such as cable television companies may choose its subscribers.
The only limitation to such dispersal of signals in the air is the technical capacity of the
transmitters and other equipment employed by the broadcaster. While the broadcaster
may use a less powerful transmitter to limit its coverage, this is merely a business
strategy or decision and not an inherent limitation when transmission is through cable.
Accordingly, the nature of broadcasting is to scatter the signals in its widest area of
coverage as possible. On this score, it may be said that making public means that
accessibility is undiscriminating as long as it [is] within the range of the transmitter and
equipment of the broadcaster. That the medium through which the Appellant carries
the Appellee’s signal, that is via satellite, does not diminish the fact that it operates and
functions as a cable television. It remains that the Appellant’s transmission of signals via
its DTH satellite television service cannot be considered within the purview of
broadcasting. x x x
xxxx
This Office also finds no evidence on record showing that the Appellant has provided
decrypting means to the public indiscriminately. Considering the nature of this case,
which is punitive in fact, the burden of proving the existence of the elements
constituting the acts punishable rests on the shoulder of the complainant.
Accordingly, this Office finds that there is no rebroadcasting on the part of the Appellant
of the Appellee’s programs on Channels 2 and 23, as defined under the Rome
Convention.22
Under the Rome Convention, rebroadcasting is “the simultaneous broadcasting by one
broadcasting organization of the broadcast of another broadcasting organization.” The
Working Paper23 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.”24 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.
The Director-General of the IPO and the Court of Appeals also correctly found that
PMSI’s services are similar to a cable television system because the services it renders
fall under cable “retransmission,” as described in the Working Paper, to wit:
(G) Cable Retransmission
47. When a radio or television program is being broadcast, it can be retransmitted to
new audiences by means of cable or wire. In the early days of cable television, it was
mainly used to improve signal reception, particularly in so-called “shadow zones,” or to
distribute the signals in large buildings or building complexes. With improvements in
technology, cable operators now often receive signals from satellites before
retransmitting them in an unaltered form to their subscribers through cable.
48. In principle, cable retransmission can be either simultaneous with the broadcast
over-the-air or delayed (deferred transmission) on the basis of a fixation or a
reproduction of a fixation. Furthermore, they might be unaltered or altered, for example
through replacement of commercials, etc. In general, however, the term
“retransmission” seems to be reserved for such transmissions which are both
simultaneous and unaltered.
49. The Rome Convention does not grant rights against unauthorized cable
retransmission. Without such a right, cable operators can retransmit both domestic and
foreign over the air broadcasts simultaneously to their subscribers without permission
from the broadcasting organizations or other rightholders and without obligation to pay
remuneration.25 (Emphasis added)
Thus, while the Rome Convention gives broadcasting organizations the right to authorize
or prohibit the rebroadcasting of its broadcast, however, this protection does not
extend to cable retransmission. The retransmission of ABS-CBN’s signals by PMSI –
which functions essentially as a cable television – does not therefore constitute
rebroadcasting in violation of the former’s intellectual property rights under the IP
Code.
It must be emphasized that the law on copyright is not absolute. The IP Code provides
that:
Sec. 184. Limitations on Copyright. -
184.1. Notwithstanding the provisions of Chapter V, the following acts shall not
constitute infringement of copyright:
xxxx
(h) The use made of a work by or under the direction or control of the Government, by
the National Library or by educational, scientific or professional institutions where such
use is in the public interest and is compatible with fair use;
The carriage of ABS-CBN’s signals by virtue of the must-carry rule in Memorandum
Circular No. 04-08-88 is under the direction and control of the government though the
NTC which is vested with exclusive jurisdiction to supervise, regulate and control
telecommunications and broadcast services/facilities in the Philippines.26 The imposition
of the must-carry rule is within the NTC’s power to promulgate rules and regulations, as
public safety and interest may require, to encourage a larger and more effective use of
communications, radio and television broadcasting facilities, and to maintain effective
competition among private entities in these activities whenever the Commission finds it
reasonably feasible.27 As correctly observed by the Director-General of the IPO:
Accordingly, the “Must-Carry Rule” under NTC Circular No. 4-08-88 falls under the
foregoing category of limitations on copyright. This Office agrees with the Appellant
[herein respondent PMSI] that the “Must-Carry Rule” is in consonance with the
principles and objectives underlying Executive Order No. 436,28 to wit:
The Filipino people must be given wider access to more sources of news, information,
education, sports event and entertainment programs other than those provided for by
mass media and afforded television programs to attain a well informed, well-versed and
culturally refined citizenry and enhance their socio-economic growth:
WHEREAS, cable television (CATV) systems could support or supplement the services
provided by television broadcast facilities, local and overseas, as the national
information highway to the countryside.29
The Court of Appeals likewise correctly observed that:
[T]he very intent and spirit of the NTC Circular will prevent a situation whereby station
owners and a few networks would have unfettered power to make time available only
to the highest bidders, to communicate only their own views on public issues, people,
and to permit on the air only those with whom they agreed – contrary to the state
policy that the (franchise) grantee like the petitioner, private respondent and other TV
station owners, shall provide at all times sound and balanced programming and assist in
the functions of public information and education.
This is for the first time that we have a structure that works to accomplish explicit state
policy goals.30
Indeed, intellectual property protection is merely a means towards the end of making
society benefit from the creation of its men and women of talent and genius. This is the
essence of intellectual property laws, and it explains why certain products of ingenuity
that are concealed from the public are outside the pale of protection afforded by the
law. It also explains why the author or the creator enjoys no more rights than are
consistent with public welfare.31
Further, as correctly observed by the Court of Appeals, the must-carry rule as well as the
legislative franchises granted to both ABS-CBN and PMSI are in consonance with state
policies enshrined in the Constitution, specifically Sections 9,32 17,33 and 2434 of Article II
on the Declaration of Principles and State Policies.35
ABS-CBN was granted a legislative franchise under Republic Act No. 7966, Section 1 of
which authorizes it “to construct, operate and maintain, for commercial purposes and in
the public interest, television and radio broadcasting in and throughout the Philippines x
x x.” Section 4 thereof mandates that it “shall provide adequate public service time to
enable the government, through the said broadcasting stations, to reach the population
on important public issues; provide at all times sound and balanced programming;
promote public participation such as in community programming; assist in the functions
of public information and education x x x.”
PMSI was likewise granted a legislative franchise under Republic Act No. 8630, Section 4
of which similarly states that it “shall provide adequate public service time to enable the
government, through the said broadcasting stations, to reach the population on
important public issues; provide at all times sound and balanced programming; promote
public participation such as in community programming; assist in the functions of public
information and education x x x.” Section 5, paragraph 2 of the same law provides that
“the radio spectrum is a finite resource that is a part of the national patrimony and the
use thereof is a privilege conferred upon the grantee by the State and may be
withdrawn anytime, after due process.”
In Telecom. & Broadcast Attys. of the Phils., Inc. v. COMELEC, 36 the Court held that a
franchise is a mere privilege which may be reasonably burdened with some form of
public service. Thus:
All broadcasting, whether by radio or by television stations, is licensed by the
government. Airwave frequencies have to be allocated as there are more individuals
who want to broadcast than there are frequencies to assign. A franchise is thus a
privilege subject, among other things, to amendment by Congress in accordance with
the constitutional provision that “any such franchise or right granted . . . shall be subject
to amendment, alteration or repeal by the Congress when the common good so
requires.”
xxxx
Indeed, provisions for COMELEC Time have been made by amendment of the franchises
of radio and television broadcast stations and, until the present case was brought, such
provisions had not been thought of as taking property without just compensation. Art.
XII, §11 of the Constitution authorizes the amendment of franchises for “the common
good.” What better measure can be conceived for the common good than one for free
air time for the benefit not only of candidates but even more of the public, particularly
the voters, so that they will be fully informed of the issues in an election? “[I]t is the
right of the viewers and listeners, not the right of the broadcasters, which is
paramount.”
Nor indeed can there be any constitutional objection to the requirement that broadcast
stations give free air time. Even in the United States, there are responsible scholars who
believe that government controls on broadcast media can constitutionally be instituted
to ensure diversity of views and attention to public affairs to further the system of free
expression. For this purpose, broadcast stations may be required to give free air time to
candidates in an election. Thus, Professor Cass R. Sunstein of the University of Chicago
Law School, in urging reforms in regulations affecting the broadcast industry, writes:
xxxx
In truth, radio and television broadcasting companies, which are given franchises, do not
own the airwaves and frequencies through which they transmit broadcast signals and
images. They are merely given the temporary privilege of using them. Since a franchise
is a mere privilege, the exercise of the privilege may reasonably be burdened with the
performance by the grantee of some form of public service. x x x37
There is likewise no merit to ABS-CBN’s claim that PMSI’s carriage of its signals is for a
commercial purpose; that its being the country’s top broadcasting company, the
availability of its signals allegedly enhances PMSI’s attractiveness to potential
customers;38 or that the unauthorized carriage of its signals by PMSI has created
competition between its Metro Manila and regional stations.
ABS-CBN presented no substantial evidence to prove that PMSI carried its signals for
profit; or that such carriage adversely affected the business operations of its regional
stations. Except for the testimonies of its witnesses,[39] no studies, statistical data or
information have been submitted in evidence.
Administrative charges cannot be based on mere speculation or conjecture. The
complainant has the burden of proving by substantial evidence the allegations in the
complaint.40 Mere allegation is not evidence, and is not equivalent to proof.41
Anyone in the country who owns a television set and antenna can receive ABS-CBN’s
signals for free. Other broadcasting organizations with free-to-air signals such as GMA-7,
RPN-9, ABC-5, and IBC-13 can likewise be accessed for free. No payment is required to
view the said channels42 because these broadcasting networks do not generate revenue
from subscription from their viewers but from airtime revenue from contracts with
commercial advertisers and producers, as well as from direct sales.
In contrast, cable and DTH television earn revenues from viewer subscription. In the
case of PMSI, it offers its customers premium paid channels from content providers like
Star Movies, Star World, Jack TV, and AXN, among others, thus allowing its customers to
go beyond the limits of “Free TV and Cable TV.”43 It does not advertise itself as a local
channel carrier because these local channels can be viewed with or without DTH
television.
Relevantly, PMSI’s carriage of Channels 2 and 23 is material in arriving at the ratings and
audience share of ABS-CBN and its programs. These ratings help commercial advertisers
and producers decide whether to buy airtime from the network. Thus, the must-carry
rule is actually advantageous to the broadcasting networks because it provides them
with increased viewership which attracts commercial advertisers and producers.
On the other hand, the carriage of free-to-air signals imposes a burden to cable and DTH
television providers such as PMSI. PMSI uses none of ABS-CBN’s resources or equipment
and carries the signals and shoulders the costs without any recourse of
charging.44 Moreover, such carriage of signals takes up channel space which can
otherwise be utilized for other premium paid channels.
There is no merit to ABS-CBN’s argument that PMSI’s carriage of Channels 2 and 23
resulted in competition between its Metro Manila and regional stations. ABS-CBN is free
to decide to pattern its regional programming in accordance with perceived demands of
the region; however, it cannot impose this kind of programming on the regional viewers
who are also entitled to the free-to-air channels. It must be emphasized that, as a
national broadcasting organization, one of ABS-CBN’s responsibilities is to scatter its
signals to the widest area of coverage as possible. That it should limit its signal reach for
the sole purpose of gaining profit for its regional stations undermines public interest and
deprives the viewers of their right to access to information.
Indeed, television is a business; however, the welfare of the people must not be
sacrificed in the pursuit of profit. The right of the viewers and listeners to the most
diverse choice of programs available is paramount.45 The Director-General correctly
observed, thus:
The “Must-Carry Rule” favors both broadcasting organizations and the public. It
prevents cable television companies from excluding broadcasting organization especially
in those places not reached by signal. Also, the rule prevents cable television companies
from depriving viewers in far-flung areas the enjoyment of programs available to city
viewers. In fact, this Office finds the rule more burdensome on the part of the cable
television companies. The latter carries the television signals and shoulders the costs
without any recourse of charging. On the other hand, the signals that are carried by
cable television companies are dispersed and scattered by the television stations and
anybody with a television set is free to pick them up.
With its enormous resources and vaunted technological capabilities, Appellee’s [herein
petitioner ABS-CBN] broadcast signals can reach almost every corner of the archipelago.
That in spite of such capacity, it chooses to maintain regional stations, is a business
decision. That the “Must-Carry Rule” adversely affects the profitability of maintaining
such regional stations since there will be competition between them and its Metro
Manila station is speculative and an attempt to extrapolate the effects of the rule. As
discussed above, Appellant’s DTH satellite television services is of limited subscription.
There was not even a showing on part of the Appellee the number of Appellant’s
subscribers in one region as compared to non-subscribing television owners. In any
event, if this Office is to engage in conjecture, such competition between the regional
stations and the Metro Manila station will benefit the public as such competition will
most likely result in the production of better television programs.”46
All told, we find that the Court of Appeals correctly upheld the decision of the IPO
Director-General that PMSI did not infringe on ABS-CBN’s intellectual property rights
under the IP Code. The findings of facts of administrative bodies charged with their
specific field of expertise, are afforded great weight by the courts, and in the absence of
substantial showing that such findings are made from an erroneous estimation of the
evidence presented, they are conclusive, and in the interest of stability of the
governmental structure, should not be disturbed.47
Moreover, the factual findings of the Court of Appeals are conclusive on the parties and
are not reviewable by the Supreme Court. They carry even more weight when the Court
of Appeals affirms the factual findings of a lower fact-finding body,48 as in the instant
case.
There is likewise no merit to ABS-CBN’s contention that the Memorandum Circular
excludes from its coverage DTH television services such as those provided by PMSI.
Section 6.2 of the Memorandum Circular requires all cable television system operators
operating in a community within Grade “A” or “B” contours to carry the television
signals of the authorized television broadcast stations.49 The rationale behind its
issuance can be found in the whereas clauses which state:
Whereas, Cable Television Systems or Community Antenna Television (CATV) have
shown their ability to offer additional programming and to carry much improved
broadcast signals in the remote areas, thereby enriching the lives of the rest of the
population through the dissemination of social, economic, educational information and
cultural programs;
Whereas, the national government supports the promotes the orderly growth of the
Cable Television industry within the framework of a regulated fee enterprise, which is a
hallmark of a democratic society;
Whereas, public interest so requires that monopolies in commercial mass media shall be
regulated or prohibited, hence, to achieve the same, the cable TV industry is made part
of the broadcast media;
Whereas, pursuant to Act 3846 as amended and Executive Order 205 granting the
National Telecommunications Commission the authority to set down rules and
regulations in order to protect the public and promote the general welfare, the National
Telecommunications Commission hereby promulgates the following rules and
regulations on Cable Television Systems;
The policy of the Memorandum Circular is to carry improved signals in remote areas for
the good of the general public and to promote dissemination of information. In line with
this policy, it is clear that DTH television should be deemed covered by the
Memorandum Circular. Notwithstanding the different technologies employed, both DTH
and cable television have the ability to carry improved signals and promote
dissemination of information because they operate and function in the same way.
In its December 20, 2002 letter,50 the NTC explained that both DTH and cable television
services are of a similar nature, the only difference being the medium of delivering such
services. They can carry broadcast signals to the remote areas and possess the capability
to enrich the lives of the residents thereof through the dissemination of social,
economic, educational information and cultural programs. Consequently, while the
Memorandum Circular refers to cable television, it should be understood as to include
DTH television which provides essentially the same services.
In Eastern Telecommunications Philippines, Inc. v. International Communication
Corporation,51 we held:
The NTC, being the government agency entrusted with the regulation of activities
coming under its special and technical forte, and possessing the necessary rule-making
power to implement its objectives, is in the best position to interpret its own rules,
regulations and guidelines. The Court has consistently yielded and accorded great
respect to the interpretation by administrative agencies of their own rules unless there
is an error of law, abuse of power, lack of jurisdiction or grave abuse of discretion clearly
conflicting with the letter and spirit of the law.52
With regard to the issue of the constitutionality of the must-carry rule, the Court finds
that its resolution is not necessary in the disposition of the instant case. One of the
essential requisites for a successful judicial inquiry into constitutional questions is that
the resolution of the constitutional question must be necessary in deciding the
case.53 In Spouses Mirasol v. Court of Appeals,54 we held:
As a rule, the courts will not resolve the constitutionality of a law, if the controversy can
be settled on other grounds. The policy of the courts is to avoid ruling on constitutional
questions and to presume that the acts of the political departments are valid, absent a
clear and unmistakable showing to the contrary. To doubt is to sustain. This
presumption is based on the doctrine of separation of powers. This means that the
measure had first been carefully studied by the legislative and executive departments
and found to be in accord with the Constitution before it was finally enacted and
approved.55
The instant case was instituted for violation of the IP Code and infringement of ABS-
CBN’s broadcasting rights and copyright, which can be resolved without going into the
constitutionality of Memorandum Circular No. 04-08-88. As held by the Court of
Appeals, the only relevance of the circular in this case is whether or not compliance
therewith should be considered manifestation of lack of intent to commit infringement,
and if it is, whether such lack of intent is a valid defense against the complaint of
petitioner.56
The records show that petitioner assailed the constitutionality of Memorandum Circular
No. 04-08-88 by way of a collateral attack before the Court of Appeals. In Philippine
National Bank v. Palma,57 we ruled that for reasons of public policy, the constitutionality
of a law cannot be collaterally attacked. A law is deemed valid unless declared null and
void by a competent court; more so when the issue has not been duly pleaded in the
trial court.58
As a general rule, the question of constitutionality must be raised at the earliest
opportunity so that if not raised in the pleadings, ordinarily it may not be raised in the
trial, and if not raised in the trial court, it will not be considered on appeal.59 In
Philippine Veterans Bank v. Court of Appeals,60 we held:
We decline to rule on the issue of constitutionality as all the requisites for the exercise
of judicial review are not present herein. Specifically, the question of constitutionality
will not be passed upon by the Court unless, at the first opportunity, it is properly
raised and presented in an appropriate case, adequately argued, and is necessary to a
determination of the case, particularly where the issue of constitutionality is the very
lis mota presented.x x x61
Finally, we find that the dismissal of the petition for contempt filed by ABS-CBN is in
order.

Indirect contempt may either be initiated (1) motu proprio by the court by issuing an
order or any other formal charge requiring the respondent to show cause why he should
not be punished for contempt or (2) by the filing of a verified petition, complying with
the requirements for filing initiatory pleadings.62

ABS-CBN filed a verified petition before the Court of Appeals, which was docketed CA
G.R. SP No. 90762, for PMSI’s alleged disobedience to the Resolution and Temporary
Restraining Order, both dated July 18, 2005, issued in CA-G.R. SP No. 88092. However,
after the cases were consolidated, the Court of Appeals did not require PMSI to
comment on the petition for contempt. It ruled on the merits of CA-G.R. SP No. 88092
and ordered the dismissal of both petitions.

ABS-CBN argues that the Court of Appeals erred in dismissing the petition for contempt
without having ordered respondents to comment on the same. Consequently, it would
have us reinstate CA-G.R. No. 90762 and order respondents to show cause why they
should not be held in contempt.

It bears stressing that the proceedings for punishment of indirect contempt are criminal
in nature. The modes of procedure and rules of evidence adopted in contempt
proceedings are similar in nature to those used in criminal prosecutions. 63 While it may
be argued that the Court of Appeals should have ordered respondents to comment, the
issue has been rendered moot in light of our ruling on the merits. To order respondents
to comment and have the Court of Appeals conduct a hearing on the contempt charge
when the main case has already been disposed of in favor of PMSI would be circuitous.
Where the issues have become moot, there is no justiciable controversy, thereby
rendering the resolution of the same of no practical use or value.64

WHEREFORE, the petition is DENIED. The July 12, 2006 Decision of the Court of Appeals
in CA-G.R. SP Nos. 88092 and 90762, sustaining the findings of the Director-General of
the Intellectual Property Office and dismissing the petitions filed by ABS-CBN
Broadcasting Corporation, and the December 11, 2006 Resolution denying the motion
for reconsideration, are AFFIRMED.

SO ORDERED.