You are on page 1of 44

Allan Verman Ong Intellectual Property Law: Cram Another Day 1

SY 2002-2003

Intellectual Property Law


RA 8293

- for the protection of creative works/intangible goods (goods that are expressions of the mind)
- framework: “What are they really protecting?”

Tangibles Inventions
Property Patents Utility Models
Industrial Industrial Designs
Property Trade Secrets
Intangibles
Trade Marks

Creative Copyrights
Rights
Neighboring Rights

Patents – grants by the State given to someone so he will have monopoly right over his property
- in exchange for you revealing something 1)new, 2) useful, and 3) has an inventive step, state
gives you protection
- Utility Model – no inventive step so lesser right and protection but it is still useful
- Industrial Design – has an artistic/aesthetic appeal

Trade Secrets – anything that will provide business with competitive advantage,
e.g. list of customers of marketing company
- not protected under the IP Code, but governed by contracts
e.g. employee contracts

Trademarks – don’t protect innovation, protects goodwill


- specific mark on goods – trademarks, servicemarks, certification marks, geographic indicators,
trade names, trade dress
- even if not registered, as long as there is goodwill, you can sue
- a “business identification system”
- before Jan. 1, 1998, RP used first to use system (whoever uses first has the trademark) with an
exception to internationally known marks (e.g. Lacoste case)
- now, RP is a first to file jurisdiction

Q. Before Jan. 1, 1998, an RP company registered Lacoste trademark, used it. It was first to use. Lacoste
filed trademark infringement suit. It was proven that the brand was already known in RP by people who had
travelled to Europe. Since RP is first to use jurisdiction, RP company has trademark?
A. No. Falls under internationally known marks exception
Allan Verman Ong Intellectual Property Law: Cram Another Day 2
SY 2002-2003

Q. McDo came to RP in 1970. In 1980s, they had huge marketing campaign so they became known in RP. Big
Mack was a large hamburger chain in the provinces. In 1980, McDo filed trademark infringement case. It was
proven that some people actually think Big Mack is affiliated with McDo and was creating confusion.
A. Big Mack wins. Trademark protects goodwill. McDo’s goodwill was established in 1980. It was proven here
that Big Mack was already established in RP before McDo became known because of the mktg campaign.

Q. You have carinderia, “Cooking Ina Mo”. Neighbor sets up “Cooking ng Ina Mo Rin.” Trademark infringement?
A. Maybe not. It does not cause/create confusion.

Creative Rights – protect unique expression of an idea


1. copyright – moral right
- what is protected is unique expression of an idea. So Einstein’s e=mc2 is not
protected, but the dissertation where he explained the idea is protected.
2. neighboring rights – performer’s rights
- what is protected is not idea but distinct/unique expression

Technology Transfer Agreements – e.g. licensing.


Aside from patents, copyrights, there are other means of protecting property in other nations

Q. Do intangibles have to be registered to enjoy protection?


A. Generally, industrial property must be registered. No need to register in creative rights – the moment you
create it, it’s yours. Registration of books in the National Library is only proof of copyright

US – computer programs are protected by patents. In RP, only copyright.

International Treaties Protecting Copyrights


1. Berne Convention – for protection of literary works, established in Aug. 1, 1951.
Core Principles:
1. national treatment – nationals from different states should have protection of their own works
2. principle of automatic protection – no need to register copyrights
3. principle of independence of protection – treat foreigners the way you protect nationals

2. TRIPS Agreement – Trade Related Aspects of IP Rights, a sub-agreement of the GATT,


Principles:
1. Establishment of minimum standards of protection as to enforcement of IPR transnationally
2. National treatment – of the IP owner
3. Most favored nation principle – treat all signatories similarly, no special treatment should be given
to any nation

Q. When can you not invoke copyright?


A. When there is: 1. Conflict with normal exploitation of work
2. When it prejudices the right of legitimate owner of right of work

Issues:
 copyright protection like Mickey Mouse are gradually entering public domain (since copyright lasts until 50
years after the death of creator) so there are moves to extend the term protection
 but Shakespeare works are public domain – so is extending term a good thing?
- US passed the Sonny Bono copyright extension act

3. WIPO Copyright Treaty - ratified Feb. 2002, protecting rights of authors in new technologies
Allan Verman Ong Intellectual Property Law: Cram Another Day 3
SY 2002-2003
- new technologies include internet and digital works
- now, temporary copies are protected (temporary – something you download from internet)
- new rights are created:
1. right to distribution
2. rental right – right of author to rent out cinematic works, phonograms, computer programs
- you can’t rent out your copy of Windows 2002 CD. But if your Palm Pilot breaks
down and you rent a Palm with Windows, it’s okay, since computer program isn’t the
“thing of rent”
3. right of communication to public – wire/wireless means

Principles:
1. circumvention of technology measures – e.g. DVD contents handling system
2. concealment of infringement – search and seizure is given in civil cases
- before, state files for search warrant, now, since civil case, private party can file for search
warrant and get injunction
3. protection is granted from the time of creation

NOTE: WIPO treaty is already ratified but still need enabling legislation, either in the form of new law of
amendment of the IP Code

PART IV
THE LAW ON COPYRIGHT
Copyright
– is a bundle of rights e.g. JKR can sell various rights like right to publish (Scholastic), right to make a movie
from her story (Warner), right to make toys from characters (e.g., Mattel)
– a “negative right” since it prevents you from enjoying, deriving benefit
– property protected is “intellectual”
– use consists of derivative rights, e.g. reproduction, translation, dramatization

Q. Database, is this protected?


A. Facts alone are not protected (same for multimedia). But if you do some arrangement on the information,
that is protected.

Q. Creativity = Originality?
A. No. In copyright, what is important is originality. As long as it is yours, it is protected.

List of Ateneo Grads – public domain


List of Ateneo Grades who worked in Judiciary – protected
 if someone else rearranges your list and does your list in alphabetical order – you can sue
 if there is distinction in the way the facts were selected, coordinated, arranged and presented,
copyrightable
Novelty – an essential element in patentability
- means that no one else in the world has come up with the same invention anywhere, anytime
- not the same with originality, although in both, you come up with a new idea
- if you develop it without outside influence, you can copyright. Several people can own the
copyright but only one person can hold the patent

SEC. 171. DEFINITIONS. - FOR THE PURPOSE OF THIS ACT, THE FOLLOWING TERMS HAVE THE FOLLOWING MEANING:

171.1. "AUTHOR" IS THE NATURAL PERSON WHO HAS CREATED THE WORK;
Allan Verman Ong Intellectual Property Law: Cram Another Day 4
SY 2002-2003

171.2. A "COLLECTIVE WORK" IS A WORK WHICH HAS BEEN CREATED BY TWO (2) OR MORE NATURAL PERSONS AT THE INITIATIVE AND

UNDER THE DIRECTION OF ANOTHER WITH THE UNDERSTANDING THAT IT WILL BE DISCLOSED BY THE LATTER UNDER HIS OWN NAME AND

THAT CONTRIBUTING NATURAL PERSONS WILL NOT BE IDENTIFIED;

171.3. "COMMUNICATION TO THE PUBLIC" OR "COMMUNICATE TO THE PUBLIC" MEANS THE MAKING OF A WORK AVAILABLE TO THE

PUBLIC BY WIRE OR WIRELESS MEANS IN SUCH A WAY THAT MEMBERS OF THE PUBLIC MAY ACCESS THESE WORKS FROM A PLACE AND TIME

INDIVIDUALLY CHOSEN BY THEM;

171.4. A "COMPUTER" IS AN ELECTRONIC OR SIMILAR DEVICE HAVING INFORMATION-PROCESSING CAPABILITIES, AND A "COMPUTER
PROGRAM" IS A SET OF INSTRUCTIONS EXPRESSED IN WORDS, CODES, SCHEMES OR IN ANY OTHER FORM, WHICH IS CAPABLE WHEN

INCORPORATED IN A MEDIUM THAT THE COMPUTER CAN READ, OR CAUSING THE COMPUTER TO PERFORM OR ACHIEVE A PARTICULAR TASK

OR RESULT;

171.5. "PUBLIC LENDING" IS THE TRANSFER OF POSSESSION OF THE ORIGINAL OR A COPY OF A WORK OR SOUND RECORDING FOR A

LIMITED PERIOD, FOR NON-PROFIT PURPOSES, BY AN INSTITUTION THE SERVICES OF WHICH ARE AVAILABLE TO THE PUBLIC, SUCH AS

PUBLIC LIBRARY OR ARCHIVE;

171.6. "PUBLIC PERFORMANCE," IN THE CASE OF A WORK OTHER THAN AN AUDIOVISUAL WORK, IS THE RECITATION, PLAYING, DANCING,

ACTING OR OTHERWISE PERFORMING THE WORK, EITHER DIRECTLY OR BY MEANS OF ANY DEVICE OR PROCESS; IN THE CASE OF AN

AUDIOVISUAL WORK, THE SHOWING OF ITS IMAGES IN SEQUENCE AND THE MAKING OF THE SOUNDS ACCOMPANYING IT AUDIBLE; AND,

IN THE CASE OF A SOUND RECORDING, MAKING THE RECORDED SOUNDS AUDIBLE AT A PLACE OR AT PLACES WHERE PERSONS OUTSIDE THE

NORMAL CIRCLE OF A FAMILY AND THAT FAMILY’S CLOSEST SOCIAL ACQUAINTANCES ARE OR CAN BE PRESENT, IRRESPECTIVE OF WHETHER

THEY ARE OR CAN BE PRESENT AT THE SAME PLACE AND AT THE SAME TIME, OR AT DIFFERENT PLACES AND/OR AT DIFFERENT TIMES, AND

WHERE THE PERFORMANCE CAN BE PERCEIVED WITHOUT THE NEED FOR COMMUNICATION WITHIN THE MEANING OF SUBSECTION 171.3;

171.7. "PUBLISHED WORKS" MEANS WORKS, WHICH, WITH THE CONSENT OF THE AUTHORS, ARE MADE AVAILABLE TO THE PUBLIC BY

WIRE OR WIRELESS MEANS IN SUCH A WAY THAT MEMBERS OF THE PUBLIC MAY ACCESS THESE WORKS FROM A PLACE AND TIME

INDIVIDUALLY CHOSEN BY THEM: PROVIDED, THAT AVAILABILITY OF SUCH COPIES HAS BEEN SUCH, AS TO SATISFY THE REASONABLE

REQUIREMENTS OF THE PUBLIC, HAVING REGARD TO THE NATURE OF THE WORK;

171.8. "RENTAL" IS THE TRANSFER OF THE POSSESSION OF THE ORIGINAL OR A COPY OF A WORK OR A SOUND RECORDING FOR A

LIMITED PERIOD OF TIME, FOR PROFIT-MAKING PURPOSES;

171.9. "REPRODUCTION" IS THE MAKING OF ONE (1) OR MORE COPIES OF A WORK OR A SOUND RECORDING IN ANY MANNER OR FORM;

171.10. A "WORK OF APPLIED ART" IS AN ARTISTIC CREATION WITH UTILITARIAN FUNCTIONS OR INCORPORATED IN A USEFUL ARTICLE,

WHETHER MADE BY HAND OR PRODUCED ON AN INDUSTRIAL SCALE;

171.11. A "WORK OF THE GOVERNMENT OF THE PHILIPPINES" IS A WORK CREATED BY AN OFFICER OR EMPLOYEE OF THE PHILIPPINE
GOVERNMENT OR ANY OF ITS SUBDIVISIONS AND INSTRUMENTALITIES, INCLUDING GOVERNMENT-OWNED OR CONTROLLED CORPORATIONS
AS PART OF HIS REGULARLY PRESCRIBED OFFICIAL DUTIES.

CHAPTER II
ORIGINAL WORKS

SEC. 172. LITERARY AND ARTISTIC WORKS. - 172.1 LITERARY AND ARTISTIC WORKS, HEREINAFTER REFERRED TO AS "WORKS", ARE

ORIGINAL INTELLECTUAL CREATIONS IN THE LITERARY AND ARTISTIC DOMAIN PROTECTED FROM THE MOMENT OF THEIR CREATION AND SHALL

INCLUDE IN PARTICULAR:

(A) BOOKS, PAMPHLETS, ARTICLES AND OTHER WRITINGS;

(B) PERIODICALS AND NEWSPAPERS;


Allan Verman Ong Intellectual Property Law: Cram Another Day 5
SY 2002-2003
(C) LECTURES, SERMONS, ADDRESSES, DISSERTATIONS PREPARED FOR ORAL DELIVERY, WHETHER OR NOT REDUCED IN WRITING

OR OTHER MATERIAL FORM;

(D) LETTERS;
(E) DRAMATIC OR DRAMATICO-MUSICAL COMPOSITIONS; CHOREOGRAPHIC WORKS OR ENTERTAINMENT IN DUMB SHOWS;
(F) MUSICAL COMPOSITIONS, WITH OR WITHOUT WORDS;
(G) WORKS OF DRAWING, PAINTING, ARCHITECTURE, SCULPTURE, ENGRAVING, LITHOGRAPHY OR OTHER WORKS OF ART;
MODELS OR DESIGNS FOR WORKS OF ART;

(H) ORIGINAL ORNAMENTAL DESIGNS OR MODELS FOR ARTICLES OF MANUFACTURE, WHETHER OR NOT REGISTRABLE AS AN
INDUSTRIAL DESIGN, AND OTHER WORKS OF APPLIED ART;

(I) ILLUSTRATIONS, MAPS, PLANS, SKETCHES, CHARTS AND THREE-DIMENSIONAL WORKS RELATIVE TO GEOGRAPHY,
TOPOGRAPHY, ARCHITECTURE OR SCIENCE;

(J) DRAWINGS OR PLASTIC WORKS OF A SCIENTIFIC OR TECHNICAL CHARACTER;


(K) PHOTOGRAPHIC WORKS INCLUDING WORKS PRODUCED BY A PROCESS ANALOGOUS TO PHOTOGRAPHY; LANTERN SLIDES;
(L) AUDIOVISUAL WORKS AND CINEMATOGRAPHIC WORKS AND WORKS PRODUCED BY A PROCESS ANALOGOUS TO
CINEMATOGRAPHY OR ANY PROCESS FOR MAKING AUDIO-VISUAL RECORDINGS;

(M) PICTORIAL ILLUSTRATIONS AND ADVERTISEMENTS;


(N) COMPUTER PROGRAMS; AND
(O) OTHER LITERARY, SCHOLARLY, SCIENTIFIC AND ARTISTIC WORKS.

172.2. WORKS ARE PROTECTED BY THE SOLE FACT OF THEIR CREATION, IRRESPECTIVE OF THEIR MODE OR FORM OF EXPRESSION, AS

WELL AS OF THEIR CONTENT, QUALITY AND PURPOSE.

The thing should be “tangible” for it to come under copyright protection. (Hence, mere idea like e=mc 2 is
not copyrightable.)
- if written, if recorded, then copyrightable. If not recorded, there is no protection because it is not in a
tangible form.

Q. Are functional objects copyrightable? E.g. Figurine Lamps


A. Test is if thing is more artistic than functional. Here, figurine lamp is more artistic so it is
copyrightable. But Magwheels would not be copyrightable because it is more functional. Cause of action is
violation of a design patent. There is no need to test the gray line since there is another source of
protection.

Q. Since only tangible things are protected, are architectural plans copyrightable?
A. Yes. This is an exception to the rule that only designs are copyrightable since architectural plans are
nothing without execution.

NOTE: There is a different rule with regard to design of chips, e.g. if design is obtained from reverse
engineering. Only plan of chip is protected so reverse engineered chip is not an infringement of copyright.
NOTE: One of the defenses to copyright infringement is absence of access. If there is no access, there
is no infringement.

CHAPTER III
DERIVATIVE WORKS
Allan Verman Ong Intellectual Property Law: Cram Another Day 6
SY 2002-2003
SEC. 173. DERIVATIVE WORKS. -
173.1. THE FOLLOWING DERIVATIVE WORKS SHALL ALSO BE PROTECTED BY COPYRIGHT:
(A) DRAMATIZATIONS, TRANSLATIONS, ADAPTATIONS, ABRIDGMENTS, ARRANGEMENTS, AND OTHER ALTERATIONS OF

LITERARY OR ARTISTIC WORKS; AND

(B) COLLECTIONS OF LITERARY, SCHOLARLY OR ARTISTIC WORKS, AND COMPILATIONS OF DATA AND OTHER MATERIALS WHICH

ARE ORIGINAL BY REASON OF THE SELECTION OR COORDINATION OR ARRANGEMENT OF THEIR CONTENTS.

• Licensing is the means to protect derivative works. In licensing, JKR allows you to make movie.
Agreement should be clear: you pay for the right to make the movie, and that is all you have if you
do not stipulate on who retains copyright to the movie. Default rule is, she retains right to the
movie.

• Licensing also includes rights like coming up with the movie in DVD format.

Q. If there is copyright violation, what kind of action will you bring – criminal, civil,
administrative?
A. Criminal. So that issues like standing to sue (if you are doing business in RP) and copyright
ownership (whether Warner owns the copyright or JKR) will not come up since the State is the
offended party.

173.2. THE WORKS REFERRED TO IN PARAGRAPHS (A) AND (B) OF SUBSECTION 173.1 SHALL BE PROTECTED AS A NEW WORKS:
PROVIDED HOWEVER, THAT SUCH NEW WORK SHALL NOT AFFECT THE FORCE OF ANY SUBSISTING COPYRIGHT UPON THE ORIGINAL WORKS
EMPLOYED OR ANY PART THEREOF, OR BE CONSTRUED TO IMPLY ANY RIGHT TO SUCH USE OF THE ORIGINAL WORKS, OR TO SECURE OR

EXTEND COPYRIGHT IN SUCH ORIGINAL WORKS.

SEC. 174. PUBLISHED EDITION OF WORK. - IN ADDITION TO THE RIGHT TO PUBLISH GRANTED BY THE AUTHOR, HIS HEIRS OR ASSIGNS,

THE PUBLISHER SHALL HAVE A COPY RIGHT CONSISTING MERELY OF THE RIGHT OF REPRODUCTION OF THE TYPOGRAPHICAL ARRANGEMENT OF

THE PUBLISHED EDITION OF THE WORK. (N)

CHAPTER IV
WORKS NOT PROTECTED
SEC. 175. UNPROTECTED SUBJECT MATTER. - NOTWITHSTANDING THE PROVISIONS OF SECTIONS 172 AND 173, NO PROTECTION SHALL
EXTEND, UNDER THIS LAW, TO:

(1) 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;

(2) NEWS OF THE DAY AND OTHER MISCELLANEOUS FACTS HAVING THE CHARACTER OF MERE ITEMS OF PRESS INFORMATION;
(3) OR ANY OFFICIAL TEXT OF A LEGISLATIVE, ADMINISTRATIVE OR LEGAL NATURE, AS WELL AS ANY OFFICIAL TRANSLATION THEREOF. (N)

SEC. 176. WORKS OF THE GOVERNMENT. -


176.1. NO COPYRIGHT SHALL SUBSIST IN ANY WORK OF THE GOVERNMENT OF THE PHILIPPINES. HOWEVER, PRIOR APPROVAL OF THE

GOVERNMENT AGENCY OR OFFICE WHEREIN THE WORK IS CREATED SHALL BE NECESSARY FOR EXPLOITATION OF SUCH WORK FOR PROFIT.

SUCH AGENCY OR OFFICE MAY, AMONG OTHER THINGS, IMPOSE AS A CONDITION THE PAYMENT OF ROYALTIES. NO PRIOR APPROVAL OR

CONDITIONS SHALL BE REQUIRED FOR THE USE OF ANY PURPOSE OF STATUTES, RULES AND REGULATIONS, AND SPEECHES, LECTURES,

SERMONS, ADDRESSES, AND DISSERTATIONS, PRONOUNCED, READ OR RENDERED IN COURTS OF JUSTICE, BEFORE ADMINISTRATIVE

AGENCIES, IN DELIBERATIVE ASSEMBLIES AND IN MEETINGS OF PUBLIC CHARACTER.

176.2. THE AUTHOR OF SPEECHES, LECTURES, SERMONS, ADDRESSES, AND DISSERTATIONS MENTIONED IN THE PRECEDING PARAGRAPHS

SHALL HAVE THE EXCLUSIVE RIGHT OF MAKING A COLLECTION OF HIS WORKS.

176.3. NOTWITHSTANDING THE FOREGOING PROVISIONS, THE GOVERNMENT IS NOT PRECLUDED FROM RECEIVING AND HOLDING

COPYRIGHTS TRANSFERRED TO IT BY ASSIGNMENT, BEQUEST OR OTHERWISE; NOR SHALL PUBLICATION OR REPUBLICATION BY THE
Allan Verman Ong Intellectual Property Law: Cram Another Day 7
SY 2002-2003
GOVERNMENT IN A PUBLIC DOCUMENT OF ANY WORK IN WHICH COPY RIGHT IS SUBSISTING BE TAKEN TO CAUSE ANY ABRIDGMENT OR

ANNULMENT OF THE COPYRIGHT OR TO AUTHORIZE ANY USE OR APPROPRIATION OF SUCH WORK WITHOUT THE CONSENT OF THE

COPYRIGHT OWNERS.

CHAPTER V
COPYRIGHT OR ECONOMIC RIGHTS
SEC. 177. COPY 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:

177.1. REPRODUCTION OF THE WORK OR SUBSTANTIAL PORTION OF THE WORK;

- reproduction must be commercial, public and substantial


- “substantial” is vague; it should be a case to case basis. Factors to be considered are length
copied and importance of a portion copied. You may copy only one paragraph but it could be the
essence of the entire thing

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;

- right to determined 1) whether or not to sell, and 2) when to sell

Q. If you buy a book then after reading it, you sell it to another, infringement?
A. No. The moment it is sold, copyright protection as to public distribution is over.

NOTE: There is a difference between copyrighted work and the medium where it is contained. So you
can sell your book, unless it is provided in the copyright agreement

Quaerendum: Does this apply to digital works? Because under the first sale doctrine, you can sell your
copy. First sale doctrine assumes there is a tangible thing. The “paper” suggests that the doctrine
should not apply to internet.

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;

- There should be permission (a license) to rent out for VHS stores to operate
- This has been made part of the WTO via the TRIPS agreement
- So if someone borrows VHS from an unlicensed store, there is also a criminal violation on his part.

177.5. PUBLIC DISPLAY OF THE ORIGINAL OR A COPY OF THE WORK;

177.6. PUBLIC PERFORMANCE OF THE WORK; AND

NOTE: Public Performance was defined earlier as:


171.6. "Public performance," in the case of a work other than an audiovisual work, is the recitation,
playing, dancing, acting or otherwise performing the work, either directly or by means of any device
or process; in the case of an audiovisual work, the showing of its images in sequence and the making
of the sounds accompanying it audible; and, in the case of a sound recording, making the recorded
sounds audible at a place or at places where persons outside the normal circle of a family and that
family’s closest social acquaintances are or can be present, irrespective of whether they are or can
be present at the same place and at the same time, or at different places and/or at different
Allan Verman Ong Intellectual Property Law: Cram Another Day 8
SY 2002-2003
times, and where the performance can be perceived without the need for communication within the
meaning of Subsection 171.3;

Q. No TV in barrio, you buy TV, subscribe from Home and charge people to watch it. Violation?
A. Yes, It falls under public performance, same rule for broadcast.

TV – point to multipoint
- point to point (since only subscriber can receive)

Q. Is there broadcast?
A. Yes, there is broadcast. Public performance and communication to the public is included. There is no
distinction as to TV or cable.

• Website with copyrighted material – point to point, protection includes broadcast and communicating to
the public so you have protection
• Internet – there is assumed right to transmit material in internet unless made very clear that there are
restrictions
• E-Commerce Act – you can enter into internet contract by clicking “I agree” in buttons
Therefore: if you click “I agree that I will not violate copyright” and still violate copyright, two causes of
action against you: 1) breach of contract and 2) copyright infringement

177.7. OTHER COMMUNICATION TO THE PUBLIC OF THE WORK

Q. Is copyright owner given right to prevent importation of the article?


A. Parallel import – in patent, the right to limit importation is clearly given. But it is not clear in copyright law.

IP Code provides in Sec. 190.

the importation of a copy of a work by an individual for his personal purposes shall be permitted without
the authorization of the author of, or other owner of copyright in, the work under the following
circumstances:
(a) When copies of the work are not available in the Philippines and:
(i) Not more than one (1) copy at one time is imported for strictly individual use only; or
(ii) The importation is by authority of and for the use of the Philippine Government; or
(iii) The importation, consisting of not more than three (3) such copies or likenesses in any one invoice, is
not for sale but for the use only of any religious, charitable, or educational society or institution duly
incorporated or registered, or is for the encouragement of the fine arts, or for any state school,
college, university, or free public library in the Philippines.

CHAPTER VI
OWNERSHIP OF COPYRIGHT
SEC. 178. RULES ON COPYRIGHT OWNERSHIP. - COPYRIGHT OWNERSHIP SHALL BE GOVERNED BY THE FOLLOWING RULES:
178.1. SUBJECT TO THE PROVISIONS OF THIS SECTION, IN THE CASE OF ORIGINAL LITERARY AND ARTISTIC WORKS, COPYRIGHT SHALL

BELONG TO THE AUTHOR OF THE WORK;

178.2. IN THE CASE OF WORKS OF JOINT AUTHORSHIP, THE CO-AUTHORS SHALL BE THE ORIGINAL OWNERS OF THE COPYRIGHT AND IN

THE ABSENCE OF AGREEMENT, THEIR RIGHTS SHALL BE GOVERNED BY THE RULES ON CO-OWNERSHIP. IF, HOWEVER, A WORK OF JOINT

AUTHORSHIP CONSISTS OF PARTS THAT CAN BE USED SEPARATELY AND THE AUTHOR OF EACH PART CAN BE IDENTIFIED, THE AUTHOR OF

EACH PART SHALL BE THE ORIGINAL OWNER OF THE COPYRIGHT IN THE PART THAT HE HAS CREATED;
Allan Verman Ong Intellectual Property Law: Cram Another Day 9
SY 2002-2003

General rule: Creator has copyright. It can be co-owned.


Copyright protection lasts until 50 years after death of author. If there are two authors, it is after the
second death. So include your son for the extra 30-40 years of protection.

178.3. IN THE CASE OF WORK CREATED BY AN AUTHOR DURING AND IN THE COURSE OF HIS EMPLOYMENT, THE COPYRIGHT SHALL
BELONG TO:

(A) THE EMPLOYEE, IF THE CREATION OF THE OBJECT OF COPYRIGHT IS NOT A PART OF HIS REGULAR DUTIES EVEN IF THE
EMPLOYEE USES THE TIME, FACILITIES AND MATERIALS OF THE EMPLOYER.

(B) THE EMPLOYER, IF THE WORK IS THE RESULT OF THE PERFORMANCE OF HIS REGULARLY-ASSIGNED DUTIES, UNLESS THERE
IS AN AGREEMENT, EXPRESS OR IMPLIED, TO THE CONTRARY.

Q. Software programmer working in a company has access to information to create accounting computer
programs. During his lunch break, he uses the equipment to create computer games. Is there copyright
infringement?
A. No. Employee has the copyright. But the ee-er contract may stipulate that employee may assign
copyright. Outright ownership is not allowed as to objects created outside the scope. By requiring the
assignment of the copyright, this is made a condition for getting the job from day one. If employee
violates the contract, the employee can be sued for 2 causes of action – breach of contract and
infringement.

178.4. IN THE CASE OF A WORK-COMMISSIONED BY A PERSON OTHER THAN AN EMPLOYER OF THE AUTHOR AND WHO PAYS FOR IT AND

THE WORK IS MADE IN PURSUANCE OF THE COMMISSION, THE PERSON WHO SO COMMISSIONED THE WORK SHALL HAVE OWNERSHIP OF

WORK, BUT THE COPYRIGHT THERETO SHALL REMAIN WITH THE CREATOR, UNLESS THERE IS A WRITTEN STIPULATION TO THE CONTRARY;

General rule: copyright remains with author. If commissioned work is photographed and published,
infringement of right of painter.
Contract has to be IN WRITING. If it is not in writing, artist/creator retains copyright.

178.5. IN THE CASE OF AUDIOVISUAL WORK, THE COPYRIGHT SHALL BELONG TO THE PRODUCER, THE AUTHOR OF THE SCENARIO, THE

COMPOSER OF THE MUSIC, THE FILM DIRECTOR, AND THE AUTHOR OF THE WORK SO ADAPTED. HOWEVER, SUBJECT TO CONTRARY OR

OTHER STIPULATIONS AMONG THE CREATORS, THE PRODUCERS SHALL EXERCISE THE COPYRIGHT TO AN EXTENT REQUIRED FOR THE

EXHIBITION OF THE WORK IN ANY MANNER, EXCEPT FOR THE RIGHT TO COLLECT PERFORMING LICENSE FEES FOR THE PERFORMANCE OF

MUSICAL COMPOSITIONS, WITH OR WITHOUT WORDS, WHICH ARE INCORPORATED INTO THE WORK; AND

Q. If you want to produce DVD, who do you talk to?


A. The producer. But for infringement case, who has cause of action?

178.6. IN RESPECT OF LETTERS, THE COPYRIGHT SHALL BELONG TO THE WRITER SUBJECT TO THE PROVISIONS OF ARTICLE 723 OF THE

CIVIL CODE.

Art. 723 – Letters and other private communications in writing are owned by the person to whom they are
addressed and delivered, but they cannot be published or disseminated without the consent of the writer
or his heirs. However, the court may authorize their publication or dissemination if the public good or the
interest of justice so requires.

Not yet sent – copyright belongs to writer


Sent – belongs to person to whom it is addressed
If not received, copyright isn’t transferred.
Allan Verman Ong Intellectual Property Law: Cram Another Day 10
SY 2002-2003

SEC. 179. ANONYMOUS AND PSEUDONYMOUS WORKS. - FOR PURPOSES OF THIS ACT, THE PUBLISHERS SHALL BE DEEMED TO REPRESENT THE

AUTHORS OF ARTICLES AND OTHER WRITINGS PUBLISHED WITHOUT THE NAMES OF THE AUTHORS OR UNDER PSEUDONYMS, UNLESS THE

CONTRARY APPEARS, OR THE PSEUDONYMS OR ADOPTED NAME LEAVES NO DOUBTS AS TO THE AUTHOR’S IDENTITY, OR IF THE AUTHOR OF THE

ANONYMOUS WORKS DISCLOSES HIS IDENTITY.

CHAPTER VII
TRANSFER OR ASSIGNMENT OF COPYRIGHT
SEC. 180. RIGHTS OF ASSIGNEE. -
180.1. THE COPYRIGHT MAY BE ASSIGNED IN WHOLE OR IN PART. WITHIN THE SCOPE OF THE ASSIGNMENT, THE ASSIGNEE IS

ENTITLED TO ALL THE RIGHTS AND REMEDIES WHICH THE ASSIGNOR HAD WITH RESPECT TO THE COPYRIGHT.

180.2. THE COPYRIGHT IS NOT DEEMED ASSIGNED INTER VIVOS IN WHOLE OR IN PART UNLESS THERE IS A WRITTEN INDICATION OF

SUCH INTENTION.

180.3. THE SUBMISSION OF A LITERARY, PHOTOGRAPHIC OR ARTISTIC WORK TO A NEWSPAPER, MAGAZINE OR PERIODICAL FOR

PUBLICATION SHALL CONSTITUTE ONLY A LICENSE TO MAKE A SINGLE PUBLICATION UNLESS A GREATER RIGHT IS EXPRESSLY GRANTED. IF
TWO (2) OR MORE PERSONS JOINTLY OWN A COPYRIGHT OR ANY PART THEREOF, NEITHER OF THE OWNERS SHALL BE ENTITLED TO GRANT

LICENSES WITHOUT THE PRIOR WRITTEN CONSENT OF THE OTHER OWNER OR OWNERS.

SEC. 181. COPYRIGHT AND MATERIAL OBJECT. - THE COPYRIGHT IS DISTINCT FROM THE PROPERTY IN THE MATERIAL OBJECT SUBJECT TO
IT. CONSEQUENTLY, THE TRANSFER OR ASSIGNMENT OF THE COPYRIGHT SHALL NOT ITSELF CONSTITUTE A TRANSFER OF THE MATERIAL

OBJECT. NOR SHALL A TRANSFER OR ASSIGNMENT OF THE SOLE COPY OR OF ONE OR SEVERAL COPIES OF THE WORK IMPLY TRANSFER OR

ASSIGNMENT OF THE COPYRIGHT.

SEC. 182. FILING OF ASSIGNMENT OF LICENSE. - AN ASSIGNMENT OR EXCLUSIVE LICENSE MAY BE FILED IN DUPLICATE WITH THE
NATIONAL LIBRARY UPON PAYMENT OF THE PRESCRIBED FEE FOR REGISTRATION IN BOOKS AND RECORDS KEPT FOR THE PURPOSE. UPON
RECORDING, A COPY OF THE INSTRUMENT SHALL BE, RETURNED TO THE SENDER WITH A NOTATION OF THE FACT OF RECORD. NOTICE OF THE

RECORD SHALL BE PUBLISHED IN THE IPO GAZETTE.

ASSIGNMENT AND LICENSE


Possible defenses to infringement are: 1.) you acquired copyright already – copyright was assigned
2.) you were allowed to do the stuff you did – you have a license
ASSIGNMENT

Copyright – a body of rights so you can assign some of these rights to other people (note, only Economic Rights
are assignable. Moral Rights are not assignable/alienable.)

Assignment has to be in writing.

NOTE: When I give a copy to a publication for publication, when there is no agreement between the parties, I
retain the copyright and it extends only to one publication.
• Second reprints are not allowed, without permission.

License
- can be free or for a fee
- Trivia: A portion of costs of CD are paid to the artist as royalty.

COPYRIGHT LICENSE
Transfer of Ownership? Yes No. This involves only permission
from the author/creator. He
retains ownership of the copyright.
Allan Verman Ong Intellectual Property Law: Cram Another Day 11
SY 2002-2003
Standing to sue for infringement? Yes. Here, you own copyright, so No. You can’t sue because only the
you can sue. copyright owner can do that.
However, you can stipulate on this.
Even to bring criminal actions?
Yes. But usually, only licensor can
sue because it is his property and
he wants to control it.
Kinds/Additional Info • Joint ownership of copyright (e.g. • Exclusive – you can license the
two authors) – ask permission from same right to somebody else and
both not be in breach (for instance, Neil
• Film – all (writer/producer/song Gaiman licensed movie rights of
writer) own the copyright. But the “Neverwhere” to BBC, Miramax,
producer represents them etc.)
• Non-Exclusive – if JKR licenses
Viva Films to make Harry Potter,
guess who will come with a lawsuit
faster than you can say
“Wingardium Leviosa?” 

Sec. 183. DESIGNATION OF SOCIETY. - THE COPYRIGHT OWNERS OR THEIR HEIRS MAY DESIGNATE A SOCIETY OF ARTISTS, WRITERS OR

COMPOSERS TO ENFORCE THEIR ECONOMIC RIGHTS AND MORAL RIGHTS ON THEIR BEHALF.

This is also known as collective administration of copyright. There is an organization called “Philippine Society
of Songwriters and Recording Artists” which is designated by all its members to take charge of the collection
of annual royalty fees from broadcast companies to broadcast their songs, then you split it among all the
artists. This does away with the need of collecting royalty fees everytime a BSB song is played. But if you’re
not a member, you can’t avail of their collection services. Gotta collect on your own.

CHAPTER VIII
LIMITATIONS ON COPYRIGHT
SEC. 184. LIMITATIONS ON COPYRIGHT. -
184.1. NOTWITHSTANDING THE PROVISIONS OF CHAPTER V, THE FOLLOWING ACTS SHALL NOT CONSTITUTE INFRINGEMENT OF
COPYRIGHT:

(A) THE RECITATION OR PERFORMANCE OF A WORK, ONCE IT HAS BEEN LAWFULLY MADE ACCESSIBLE TO THE PUBLIC, IF DONE
PRIVATELY AND FREE OF CHARGE OR IF MADE STRICTLY FOR A CHARITABLE OR RELIGIOUS INSTITUTION OR SOCIETY;

(B) THE MAKING OF QUOTATIONS FROM A PUBLISHED WORK IF THEY ARE COMPATIBLE WITH FAIR USE AND ONLY TO THE
EXTENT JUSTIFIED FOR THE PURPOSE, INCLUDING QUOTATIONS FROM NEWSPAPER ARTICLES AND PERIODICALS IN THE FORM

OF PRESS SUMMARIES: PROVIDED, THAT THE SOURCE AND THE NAME OF THE AUTHOR, IF APPEARING ON THE WORK, ARE

MENTIONED;

(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;


(D) THE REPRODUCTION AND COMMUNICATION TO THE PUBLIC OF LITERARY, SCIENTIFIC OR ARTISTIC WORKS AS PART OF
REPORTS OF CURRENT EVENTS BY MEANS OF PHOTOGRAPHY, CINEMATOGRAPHY OR BROADCASTING TO THE EXTENT NECESSARY

FOR THE PURPOSE;

(E) THE INCLUSION OF A WORK IN A PUBLICATION, BROADCAST, OR OTHER COMMUNICATION TO THE PUBLIC, SOUND
RECORDING OR FILM, IF SUCH INCLUSION IS MADE BY WAY OF ILLUSTRATION FOR TEACHING PURPOSES AND IS COMPATIBLE

WITH FAIR USE: PROVIDED, THAT THE SOURCE AND OF THE NAME OF THE AUTHOR, IF APPEARING IN THE WORK, ARE

MENTIONED;
Allan Verman Ong Intellectual Property Law: Cram Another Day 12
SY 2002-2003
(F) THE RECORDING MADE IN SCHOOLS, UNIVERSITIES, OR EDUCATIONAL INSTITUTIONS OF A WORK INCLUDED IN A

BROADCAST FOR THE USE OF SUCH SCHOOLS, UNIVERSITIES OR EDUCATIONAL INSTITUTIONS: PROVIDED, THAT SUCH
RECORDING MUST BE DELETED WITHIN A REASONABLE PERIOD AFTER THEY WERE FIRST BROADCAST: PROVIDED, FURTHER,
THAT SUCH RECORDING MAY NOT BE MADE FROM AUDIOVISUAL WORKS WHICH ARE PART OF THE GENERAL CINEMA REPERTOIRE

OF FEATURE FILMS EXCEPT FOR BRIEF EXCERPTS OF THE WORK;

(G) THE MAKING OF EPHEMERAL RECORDINGS BY A BROADCASTING ORGANIZATION BY MEANS OF ITS OWN FACILITIES AND

FOR USE IN ITS OWN BROADCAST;

(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;

(I) THE PUBLIC PERFORMANCE OR THE COMMUNICATION TO THE PUBLIC OF A WORK, IN A PLACE WHERE NO ADMISSION FEE IS

CHARGED IN RESPECT OF SUCH PUBLIC PERFORMANCE OR COMMUNICATION, BY A CLUB OR INSTITUTION FOR CHARITABLE OR

EDUCATIONAL PURPOSE ONLY, WHOSE AIM IS NOT PROFIT MAKING, SUBJECT TO SUCH OTHER LIMITATIONS AS MAY BE

PROVIDED IN THE REGULATIONS; (N)


(J) PUBLIC DISPLAY OF THE ORIGINAL OR A COPY OF THE WORK NOT MADE BY MEANS OF A FILM, SLIDE, TELEVISION IMAGE

OR OTHERWISE ON SCREEN OR BY MEANS OF ANY OTHER DEVICE OR PROCESS: PROVIDED, THAT EITHER THE WORK HAS BEEN

PUBLISHED, OR, THAT ORIGINAL OR THE COPY DISPLAYED HAS BEEN SOLD, GIVEN AWAY OR OTHERWISE TRANSFERRED TO

ANOTHER PERSON BY THE AUTHOR OR HIS SUCCESSOR IN TITLE; AND

(K) ANY USE MADE OF A WORK FOR THE PURPOSE OF ANY JUDICIAL PROCEEDINGS OR FOR THE GIVING OF PROFESSIONAL

ADVICE BY A LEGAL PRACTITIONER.

184.2. THE PROVISIONS OF THIS SECTION SHALL BE INTERPRETED IN SUCH A WAY AS TO ALLOW THE WORK TO BE USED IN A MANNER

WHICH DOES NOT CONFLICT WITH THE NORMAL EXPLOITATION OF THE WORK AND DOES NOT UNREASONABLY PREJUDICE THE RIGHT

HOLDER'S LEGITIMATE INTEREST.

SEC. 185. FAIR USE OF A COPYRIGHTED WORK. -


185.1. THE FAIR USE OF A COPYRIGHTED WORK FOR CRITICISM, COMMENT, NEWS REPORTING, TEACHING INCLUDING MULTIPLE COPIES

FOR CLASSROOM USE, SCHOLARSHIP, RESEARCH, AND SIMILAR PURPOSES IS NOT AN INFRINGEMENT OF COPYRIGHT. DECOMPILATION,
WHICH IS UNDERSTOOD HERE TO BE THE REPRODUCTION OF THE CODE AND TRANSLATION OF THE FORMS OF THE COMPUTER PROGRAM TO

ACHIEVE THE INTER-OPERABILITY OF AN INDEPENDENTLY CREATED COMPUTER PROGRAM WITH OTHER PROGRAMS MAY ALSO CONSTITUTE

FAIR USE. IN DETERMINING WHETHER THE USE MADE OF A WORK IN ANY PARTICULAR CASE IS FAIR USE, THE FACTORS TO BE

CONSIDERED SHALL INCLUDE:

(A) THE PURPOSE AND CHARACTER OF THE USE, INCLUDING WHETHER SUCH USE IS OF A COMMERCIAL NATURE OR IS

FOR NON-PROFIT EDUCATION PURPOSES;

(B) THE NATURE OF THE COPYRIGHTED WORK;

 published/unpublished
 factual/fictional

- Defense of fair use has more chance in unpublished work than a published work. However, there
is little chance for the defense of an unpublished creative work to hold since in fictional work,
there is more creative input than factual work

(C) THE AMOUNT AND SUBSTANTIALITY OF THE PORTION USED IN RELATION TO THE COPYRIGHTED WORK AS A

WHOLE; AND

-if portion copied is “heart” of the work

(D) THE EFFECT OF THE USE UPON THE POTENTIAL MARKET FOR OR VALUE OF THE COPYRIGHTED WORK.
Allan Verman Ong Intellectual Property Law: Cram Another Day 13
SY 2002-2003
- test is both the present and future market

NOTE: Each Fair Use case is treated differently. The most important test in each case differs.

185.2 THE FACT THAT A WORK IS UNPUBLISHED SHALL NOT BY ITSELF BAR A FINDING OF FAIR USE IF SUCH FINDING IS MADE UPON

CONSIDERATION OF ALL THE ABOVE FACTORS.

Fair Use – always involves a balancing of interests of the copyright owner and the public.
• The copyright owner has the right to exploit his work;
• The public has the right to information and the right to share this information.
 When you cross the line, it is considered copyright infringement.

At this point, Atty. Lim discussed the Napster case (unassigned). Here is a Q&A.

Q: Napster itself does not copy or distribute music files. So, why are the record companies suing Napster?
A: It was the end users who were allegedly committing the direct infringement by making music files available and downloading files
without authorization. For several reasons, such as the problem of end-users being judgment-proof, or the need to bring thousands,
if not millions, of lawsuits to stop the infringement, the record companies initiated the action against the company, which in their
eyes facilitated the infringement.
It was alleged that Napster should be liable under a theory of either contributory infringement or vicarious liability One
may be liable for contributory infringement if one "with knowledge of the infringing activity, induces, causes, or materially
contributes to the infringing conduct of another." In the Napster case, the plaintiffs alleged that Napster's facilitation of the
identifying and downloading of files constituted contributory infringement. In the Napster case, the plaintiffs claimed that Napster
had the ability to control the activity, by allowing or filtering out the music files. Because Napster could get advertising revenue
based upon the number of "hits," it, too, was alleged that Napster had a financial interest in the infringement.

Q: Isn't this a "fair use"?


A: The fair use doctrine, sometimes called "an equitable rule of reason," was initially judicially created to allow the use of portions of
a work for purposes of criticism and comment, news reporting, scholarship, teaching, etc. The fair use doctrine is now part of the
current Copyright Act.
(1) The Purpose And Character Of The Use
Merely uploading and downloading copies of the music files -- was not transformative. The court then proceeded to look to the
commercial or non-commercial nature of the work. The more commercial the use, the less latitude for the unauthorized user.

In the Napster case, the court found the use to be commercial. Although there was no exchange of money or sale of the files, the
court nonetheless found the use to be commercial, affirming the district court's findings that (1) "a host user sending a file cannot
be said to engage in personal use when distributing that file to an anonymous requester" and (2) "Napster users get for free
something they would ordinarily have to buy." The court continued, "Commercial use is demonstrated by a showing that repeated and
exploitative unauthorized copies of copyrighted works were made to save the expense of purchasing copies." The court also noted
that for purposes of criminal law, the definition of "financial gain" also includes "the receipt of other copyrighted works."

(2) The Nature of the Copyrighted Work


In the Napster case, the works being copied are creative works -- music. The creative nature of the musical compositions and sound
recordings "cut against" a finding of fair use. The Ninth Circuit again agreed with the lower court's determination.

(3) The Amount And Substantiality Of The Portion Used In Relation To The Copyrighted Work As A Whole
In the Napster case, the determination was easy. The end-users who were doing the downloading were taking copies of the entire
song. The taking was therefore both quantitatively and qualitatively substantial. Therefore, this factor also favored the plaintiff
record companies.

(4) The Effect on the Potential Market of Value for the Work
The Ninth Circuit court in the Napster case affirmed the lower court's finding that Napster harmed the market for the works in "at
least" two ways: (1) "it reduces audio CD sales among college students" and 2) "it raises barriers to plaintiffs' entry into the market
for the digital downloading of music." In reaching its decision, the court paid particular attention to the expert's report showing that
on college campuses, there was evidence of lost retail sales of CDs on college campuses. Such lost sales were taken to be sufficient
to support the finding of "irreparable harm" needed for an injunction. The court did not place very much credence in the report by
Napster's expert that the sharing of files stimulates demand for sales of CDs.
The court did not accept that argument. The court also found Napster interfered with the record companies' efforts to
legitimately license their sound recordings and musical compositions for Internet-related downloads themselves. If it is easy to get
Allan Verman Ong Intellectual Property Law: Cram Another Day 14
SY 2002-2003
the music files for free, why would one go to the authorized site and pay for them? This, of course, assumes that the end-users have
a sense of not being in any danger whatsoever for doing the uploading and downloading.

Q: Isn't this like the Universal City Studios v. Sony case? If it was OK to videotape television shows for personal use in
Sony, why isn't it acceptable to copy music from the Internet for personal use?
A: At the time the Sony case was brought in district court, more than 20 years ago, the record showed that most people merely
"time-shifted" the television shows. They recorded shows that were on the air at inconvenient times or when they were not home.
Most importantly, Universal was not able to show that the users were archiving or "librarying" the tapes. The situation in the
Napster case is completely different. First, there is no precedent in Napster's favor for "space shifting". In Texaco, in-house
researchers at Texaco copied and kept articles from scientific journals. The Second Circuit emphasized that copies of the articles
were in the files.

Q: Isn't this really the same as just swapping some CDs or music files with your friends?
A: All of the files are compressed and converted to MP3 or an analogous technology to facilitate the fast copying of the CDs. During
the "marathon," thousands and thousands of CDs are copied. At the end of the marathon, each person who entered leaves with the
CDs he or she arrived with, as well as at least another 100.
Essentially, this is what's going on in the Napster case. It is hard to imagine that this would not be infringement! It would be
difficult to argue that this was "non-commercial copying for personal use."

Q: Will Napster be shut down?


A: The court's injunction does not require Napster to shut down. It does, however, require Napster to filter out the files that have
been identified by the plaintiff record companies. It remains to be seen whether Napster will be able to comply with the terms of
the injunction, and if not, what will happen next.
In the meanwhile, as mentioned above, the record companies are entering into agreements with various companies for the
distribution of music. I would not be surprised if, in the not-too-distant future, we see several "reasonably priced" subscription
based online services providing downloadable music files.

IMPT NOTE: When you raise fair use as a defense, you admit the facts in the complaint. Therefore:
1.) Plaintiff will no longer have to prove the facts, the trial now centers on whether or not there was fair
use.
2.) It would be an inconsistent defense if you allege fair use and you allege that you were not the one
doing the infringing.

Q. Chris Lim copies substantial portions of a book of a UP professor on IP, then he gives it out to students and
anyone who wants a copy. Infringement?
A. Yes. The fact that it is for free does not necessarily mean it is fair use.

Q. If the IP Code were amended to read, “So long as copyrighted material is used in school, it is fair use.”
Would this be constitutional?
A. Maybe not. It would be undue deprivation of property. It would also remove all incentive to create, write
law books for instance (YEHEY!!) or develop computer programs for school usage.

Q. When Chris Lim says, “I copied large portions of Atty. X’s work,” is this a valid defense?
A. No. It may serve to limit liability, but if substantial portions of the work is copied, attribution will not
protect you. Protection only exists when excerpts are used.

Note: Traditional copyright is easier to protect than digital copyright.

SONY CORP. v. UNIVERSAL CITY STUDIOS, INC.,

464 U.S. 417 (1984)

Petitioners manufacture and sell home video tape recorders. Respondents own the copyrights on some of the television
programs that are broadcast on the public airwaves. Some members of the general public use video tape recorders sold by
petitioners to record some of these broadcasts, as well as a large number of other broadcasts. Respondents commenced
Allan Verman Ong Intellectual Property Law: Cram Another Day 15
SY 2002-2003
this copyright infringement action against petitioners in the United States District Court for the Central District of
California in 1976. Respondents alleged that some individuals had used Betamax video tape recorders (VTR's) to record some
of respondents' copyrighted works which had been exhibited on commercially sponsored television and contended that these
individuals had thereby infringed respondents' copyrights. Respondents further maintained that petitioners were liable for
the copyright infringement allegedly committed by Betamax consumers because of petitioners' marketing of the Betamax
VTR's. Respondents sought no relief against any Betamax consumer. Instead, they sought money damages and an equitable
accounting of profits from petitioners, as well as an injunction against the manufacture and marketing of Betamax VTR's.

An explanation of our rejection of respondents' unprecedented attempt to impose copyright liability upon the distributors
of copying equipment requires a quite detailed recitation of the findings of the District Court. In summary, those findings
reveal that the average member of the public uses a VTR principally to record a program he cannot view as it is being
televised and then to watch it once at a later time. This practice, known as "time-shifting," enlarges the television viewing
audience. For that reason, a significant amount of television programming may be used in this manner without objection from
the owners of the copyrights on the programs. For the same reason, even the two respondents in this case, who do assert
objections to time-shifting in this litigation, were unable to prove that the practice has impaired the commercial value of
their copyrights or has created any likelihood of future harm.

Held: Given these findings, there is no basis in the Copyright Act upon which respondents can hold petitioners
liable for distributing VTR's to the general public. Each of the respondents owns a large inventory of valuable
copyrights, but in the total spectrum of television programming their combined market share is small. The
exact percentage is not specified, but it is well below 10%. If they were to prevail, the outcome of this
litigation would have a significant impact on both the producers and the viewers of the remaining 90% of the
programming in the Nation. No doubt, many other producers share respondents' concern about the possible
consequences of unrestricted copying. Nevertheless the findings of the District Court make it clear that time-
shifting may enlarge the total viewing audience and that many producers are willing to allow private time-
shifting to continue, at least for an experimental time period.

Die Another Day I'm gonna break the cycle


I'm gonna shake up the system
I'm gonna wake up, yes and no I'm gonna destroy my ego
I'm gonna kiss some part of I'm gonna close my body now
I'm gonna keep this secret
I'm gonna close my body now Uh, uh

I guess, die another day I think I'll find another way


I guess, die another day There's so much more to know
I guess, die another day I guess I'll die another day
I guess, die another day It's not my time to go

I guess I'll die another day For every sin, I'll have to pay
(Another day) I've come to work, I've come to play
I guess I'll die another day I think I'll find another way
(Another day) It's not my time to go
I guess I'll die another day
(Another day) I'm gonna avoid the cliche
I guess I'll die another day I'm gonna suspend my senses
I'm gonna delay my pleasure
Sigmund Freud I'm gonna close my body now
Analyze this
Analyze this I guess, die another day
Analyze this I guess I'll die another day
I guess, die another day
Allan Verman Ong Intellectual Property Law: Cram Another Day 16
SY 2002-2003
I guess I'll die another day
2 finding of contributory infringement would inevitably frustrate the
I think I'll find another way
There's so much more to know interests of broadcasters in reaching the portion of their audience that is
I guess I'll die another day available only through time-shifting.
It's not my time to go

Uh, uh
Of course, the fact that other copyright holders may welcome the practice
I guess, die another day
I guess I'll die another day
of time-shifting does not mean that respondents should be deemed to have
I guess, die another day granted a license to copy their programs. Third-party conduct would be
I guess I'll die another day
wholly irrelevant in an action for direct infringement of respondents'
Another day [x6]
copyrights. But in an action for contributory infringement against the seller
of copying equipment, the copyright holder may not prevail unless the relief
that he seeks affects only his programs, or unless he speaks for virtually all
If there are millions of owners
copyright holders with an interest in the outcome. In this case, the record
of VTR's who make copies of
makes it perfectly clear that there are many important producers of
televised sports events,
national and local television programs who find nothing objectionable about
religious broadcasts, and
the enlargement in the size of the television audience that results from the
educational programs such as
practice of time-shifting for private home use. The seller of the equipment
Mister Rogers' Neighborhood,
that expands those producers' audiences cannot be a contributory infringer
and if the proprietors of those
if, as is true in this case, it has had no direct involvement with any infringing
programs welcome the practice,
activity.
the business of supplying the
equipment that makes such
Even unauthorized uses of a copyrighted work are not necessarily infringing.
copying feasible should not be
An unlicensed use of the copyright is not an infringement unless it conflicts
stifled simply because the
with one of the specific exclusive rights conferred by the copyright statute.
equipment is used by some
Moreover, the definition of exclusive rights in 106 of the present Act is
individuals to make unauthorized
prefaced by the words "subject to sections 107 through 118." Those sections
reproductions of respondents'
describe a variety of uses of copyrighted material that "are not
works. The respondents do not
infringements of copyright" "notwithstanding the provisions of section 106."
represent a class composed of
The most pertinent in this case is 107, the legislative endorsement of the
all copyright holders. Yet a
doctrine of "fair use."

That section identifies various factors that enable a court to apply an "equitable rule of reason" analysis to
particular claims of infringement. Although not conclusive, the first factor requires that "the commercial or
nonprofit character of an activity" be weighed in any fair use decision. If the Betamax were used to make
copies for a commercial or profitmaking purpose, such use would presumptively be unfair. The contrary
presumption is appropriate here, however, because the District Court's findings plainly establish that time-
shifting for private home use must be characterized as a noncommercial, nonprofit activity. Moreover, when
one considers the nature of a televised copyrighted audiovisual work, and that time-shifting merely enables a
viewer to see such a work which he had been invited to witness in its entirety free of charge, the fact that
the entire work is reproduced, see 107(3), does not have its ordinary effect of militating against a finding of
fair use.

This is not, however, the end of the inquiry because Congress has also directed us to consider "the effect of
the use upon the potential market for or value of the copyrighted work." 107(4). The purpose of copyright is to
create incentives for creative effort. Even copying for noncommercial purposes may impair the copyright
holder's ability to obtain the rewards that Congress intended him to have. But a use that has no demonstrable
effect upon the potential market for, or the value of, the copyrighted work need not be prohibited in order to
protect the author's incentive to create. The prohibition of such noncommercial uses would merely inhibit
access to ideas without any countervailing benefit.

Thus, although every commercial use of copyrighted material is presumptively an unfair exploitation of the
monopoly privilege that belongs to the owner of the copyright, noncommercial uses are a different matter. A
Allan Verman Ong Intellectual Property Law: Cram Another Day 17
SY 2002-2003
challenge to a noncommercial use of a copyrighted work requires proof either that the particular use is
harmful, or that if it should become widespread, it would adversely affect the potential market for the
copyrighted work. Actual present harm need not be shown; such a requirement would leave the copyright
holder with no defense against predictable damage. Nor is it necessary to show with certainty that future
harm will result. What is necessary is a showing by a preponderance of the evidence that some meaningful
likelihood of future harm exists. If the intended use is for commercial gain, that likelihood may be presumed.
But if it is for a noncommercial purpose, the likelihood must be demonstrated.

When these factors are all weighed in the "equitable rule of reason" balance, we must conclude that this
record amply supports the District Court's conclusion that home time-shifting is fair use. In light of the
findings of the District Court regarding the state of the empirical data, it is clear that the Court of Appeals
erred in holding that the statute as presently written bars such conduct.

In summary, the record and findings of the District Court lead us to two conclusions. First, Sony demonstrated
a significant likelihood that substantial numbers of copyright holders who license their works for broadcast on
free television would not object to having their broadcasts time-shifted by private viewers. And second,
respondents failed to demonstrate that time-shifting would cause any likelihood of nonminimal harm to the
potential market for, or the value of, their copyrighted works. The Betamax is, therefore, capable of
substantial noninfringing uses. Sony's sale of such equipment to the general public does not constitute
contributory infringement of respondents' copyrights.
STEWART v. ABEND, 495 U.S. 207 (1990)
495 U.S. 207

Cornell Woolrich authored the story "It Had to Be Murder," which was first published in February 1942 in Dime Detective
Magazine. The magazine's publisher, Popular Publications, Inc., obtained the rights to magazine publication of the story and
Woolrich retained all other rights. Popular Publications obtained a blanket copyright for the issue of Dime Detective
Magazine in which "It Had to Be Murder" was published.

The Copyright Act of 1909 provided authors a 28-year initial term of copyright protection plus a 28-year renewal term. In
1945, Woolrich agreed to assign the rights to make motion picture versions of six of his stories, including "It Had to Be
Murder," to B. G. De Sylva Productions for $9,250. He also agreed to renew the copyrights in the stories at the appropriate
time and to assign the same motion picture rights to De Sylva Productions for the 28-year renewal term. In 1953, actor
Jimmy Stewart and director Alfred Hitchcock formed a production company, Patron, Inc., which obtained the motion picture
rights in "It Had to Be Murder" from De Sylva's successors in interest for $10,000.

In 1954, Patron, Inc., along with Paramount Pictures, produced and distributed "Rear Window," the motion picture version of
Woolrich's story "It Had to Be Murder." Woolrich died in 1968 before he could obtain the rights in the renewal term for
petitioners as promised and without a surviving spouse or child. He left his property to a trust administered by his executor,
Chase Manhattan Bank, for the benefit of Columbia University. On December 29, 1969, Chase Manhattan Bank renewed the
copyright in the "It Had to Be Murder" story. Chase Manhattan assigned the renewal rights to respondent Abend for $650
plus 10% of all proceeds from exploitation of the story.

"Rear Window" was broadcast on the ABC television network in 1971. Respondent then notified petitioners Hitchcock (now
represented by cotrustees of his will), Stewart, and MCA Inc., the owners of the "Rear Window" motion picture and renewal
rights in the motion picture, that he owned the renewal rights in the copyright and that their distribution of the motion
picture without his permission infringed his copyright in the story. Hitchcock, Stewart, and MCA nonetheless entered into a
second license with ABC to rebroadcast

Petitioners assert that even if their use of "It Had to Be Murder" is unauthorized, it is a fair use and, therefore, not
infringing. At common law, "the property of the author . . . in his intellectual creation [was] absolute until he voluntarily
part[ed] with the same. The fair use doctrine, which is incorporated into the 1976 Act, evolved in response to this absolute
rule.
Allan Verman Ong Intellectual Property Law: Cram Another Day 18
SY 2002-2003
Held: The Court of Appeals determined that the use of Woolrich's story in petitioners' motion picture was
not fair use. We agree. The motion picture neither falls into any of the categories enumerated in 107 nor
meets the four criteria set forth in 107. "[E]very [unauthorized] commercial use of copyrighted material is
presumptively an unfair exploitation of the monopoly privilege that belongs to the owner of the copyright."
Petitioners received $12 million from the re-release of the motion picture during the renewal term. Petitioners
asserted before the Court of Appeals that their use was educational rather than commercial. The Court of
Appeals found nothing in the record to support this assertion, nor do we.
Applying the second factor, the Court of Appeals pointed out that "[a] use is less likely to be deemed fair when
the copyrighted work is a creative product." In general, fair use is more likely to be found in factual works
than in fictional works. The law generally recognizes a greater need to disseminate factual works than works of
fiction or fantasy. A motion picture based on a fictional short story obviously falls into the latter category.

Examining the third factor, the Court of Appeals determined that the story was a substantial portion of the
motion picture. The motion picture expressly uses the story's unique setting, characters, plot, and sequence of
events. Petitioners argue that the story constituted only 20% of the motion picture's story line, but that does
not mean that a substantial portion of the story was not used in the motion picture. "[A] taking may not be
excused merely because it is insubstantial with respect to the infringing work."

The fourth factor is the "most important, and indeed, central fair use factor." The record supports the Court
of Appeals' conclusion that re-release of the film impinged on the ability to market new versions of the story.
Common sense would yield the same conclusion. Thus, all four factors point to unfair use. "This case presents a
classic example of an unfair use: a commercial use of a fictional story that adversely affects the story owner's
adaptation rights."
PLAYBOY ENTERPRISES, INC., Plaintiff, v. George FRENA
George Frena operates a subscription computer bulletin board service, Techs Warehouse BBS ("BBS"), that distributed
unauthorized copies of Plaintiff Playboy Enterprises, Inc.'s copyrighted photographs. BBS is accessible via telephone modem
to customers. For a fee, or to those who purchase certain products from Defendant Frena, anyone with an appropriately
equipped computer can log onto BBS. Once logged on subscribers may browse through different BBS directories to look at
the pictures and customers may also download the high quality computerized copies of the photographs and then store the
copied image from Frena's computer onto their home computer. Many of the images found on BBS include adult subject
matter. One hundred and seventy of the images that were available on BBS were copies of photographs taken from PEI's
copyrighted materials.

Defendant Frena admits that (1) these materials were displayed on his BBS, (2) that he never obtained authorization or
consent from PEI, and (3) that each of the accused computer graphic files on BBS is substantially similar to copyrighted PEI
photographs and (4) that each of the files in question has been downloaded by one of his customers.

Subscribers can upload material onto the bulletin board so that any other subscriber, by accessing their computer, can see
that material. Defendant Frena states that he never uploaded any of PEI's photographs onto BBS and that subscribers to
BBS uploaded the photographs. Defendant Frena states that as soon as he was served with a summons and made aware of
this matter, he removed the photographs from BBS and has since that time monitored BBS to prevent additional
photographs of PEI from being uploaded. Defendant Frena argues that the affirmative defense of fair use precludes a
finding of copyright infringement.

Held: The question of fair use constitutes a mixed issue of law and fact. The Copyright Act mandates four
nonexclusive factors which courts shall consider case by case in determining fair use. Section 107 does not
attempt to define "fair use." It merely lists the factors to be considered in determining whether a use made
of a work in a particular case is fair.

FIRST: every commercial use of copyrighted material is presumptively an unfair exploitation of the monopoly
privilege that belongs to the owner of the copyright ...,"
Allan Verman Ong Intellectual Property Law: Cram Another Day 19
SY 2002-2003
Defendant Frena's use was clearly commercial. BBS was provided to those paying twenty-five dollars ($25) per
month or to those who purchased products from Defendant Frena. One who distributes copyrighted material
for profit is engaged in a commercial use even if the customers supplied with such material themselves use it
for personal use. Implicit in the presumption that every commercial use is presumptively unfair is "some
meaningful likelihood that future market harm exists." It is clear that future market harm exists to PEI due
to Frena's activities

SECOND: the "nature of the copyrighted work." "Copyright protection is narrower, and the corresponding
application of fair use defense greater, in the case of factual works than in the case of works of fiction or
fantasy." If a work is more appropriately characterized as entertainment, it is less likely that a claim of fair
use will be accepted. The copyrighted works involved in this case are in the category of fantasy and
entertainment. Therefore, the second factor works against Frena's fair use defense.

THIRD: the amount and substantiality of the portion of the copyrighted work used, the Supreme Court has
directed a qualitative evaluation of the copying of the copyrighted work. That is, "a small degree of taking is
sufficient to transgress fair use if the copying is the essential part of the copyrighted work." There is no
doubt that the photographs in Playboy magazine are an essential part of the copyrighted work. The Court is
not implying that people do not read the articles in PEI's magazine. However, a major factor to PEI's success
is the photographs in its magazine. By pirating the photographs for which PEI has become famous, Defendant
Frena has taken a very important part of PEI's copyrighted publications.

FOURTH: the "effect of the use upon the potential market for or value of the copyrighted work," is
"undoubtedly the single most important element of fair use, since a proper application of fair use does not
impair materially the marketability of the copied work." This factor poses the issue of "whether unrestricted
and widespread conduct of the sort engaged in by the defendant (whether in fact engaged in by the defendant
or others) would result in a substantially adverse impact on the potential market for or value of the plaintiff's
present work.” [P]otential market means either an immediate or delayed market, and includes harm to
derivative works. Obviously, if this type of conduct became widespread, it would adversely affect the
potential market for the copyrighted work. Such conduct would deny PEI considerable revenue to which it is
entitled for the service it provides.

There is irrefutable evidence of direct copyright infringement in this case. It does not matter that Defendant
Frena may have been unaware of the copyright infringement. Intent to infringe is not needed to find copyright
infringement. Intent or knowledge is not an element of infringement, and thus even an innocent infringer is
liable for infringement; rather, innocence is significant to a trial court when it fixes statutory damages, which
is a remedy equitable in nature.
SEGA ENTERPRISES LTD. v. MAPHIA
Sega is a major manufacturer and distributor of computer video game systems and computer video games which are sold
under the SEGA trademark. The Sega game system consists of two major components sold by Sega: the game console and
software programs stored on video game cartridges which are inserted into the base unit. Each cartridge contains a single
game program. The base unit contains a microcomputer which, when connected to a television, permits individuals to play the
video game stored on the inserted cartridge. The computer programs for the Sega video games are stored on a cartridge in a
Read-Only Memory ("ROM") chip. Sega's video games cannot be copied using the game console. However, as noted below,
running devices, called "copiers," are designed to copy the video game programs from a Sega game cartridge onto other
magnetic media such as hard and floppy disks.

An electronic bulletin board consists of electronic storage media, such as computer memories or hard disks, which is
attached to telephone lines via modem devices, and controlled by a computer. Third parties, known as "users," of electronic
bulletin boards can transfer information over the telephone lines from their own computers to the storage media on the
bulletin board by a process known as "uploading." Defendants MAPHIA and Chad Scherman operate an electronic bulletin
board called MAPHIA (hereinafter "the MAPHIA bulletin board"). The MAPHIA bulletin board is open to the public and,
according to Defendant Scherman's Opposition Memorandum, has approximately 400 users. The evidence establishes that
Allan Verman Ong Intellectual Property Law: Cram Another Day 20
SY 2002-2003
Sega's copyrighted video games are available on and transferred to and from the MAPHIA bulletin board by users who
upload and download games. Once a game is uploaded to the MAPHIA bulletin board it may be downloaded in its entirety by
an unlimited number of users. It appears that the copies of Sega's video game programs on Defendants' bulletin board are
unauthorized copies of Sega's copyrighted video games, having been uploaded there by users of Defendant's bulletin board.
There is evidence that MAPHIA directly or through an affiliate sometimes charges a direct fee for downloading privileges,
or barters for the privilege of downloading Sega's games. Information on the MAPHIA bulletin board includes the following
passage: Thank you for purchasing a Console Back Up Unit [copier] from PARSEC TRADING. As a free bonus for ordering
from Dark Age, you receive a COMPLEMENTARY Free Download Ratio on our Customer Support BBS. Defendant thus
provides downloading privileges for Sega games to users in exchange for the uploading of Sega games or other programs or
information or in exchange for payment for other goods, such as copiers, or services, such as the provision of credit card
numbers to users.

Held: Sega has established that unauthorized copies of these games are also made when they are downloaded
to make additional copies by users, which copying is facilitated and encouraged by the MAPHIA bulletin board.
"[O]ne who, with knowledge of the infringing activity, induces, causes or materially contributes to the
infringing conduct of another," may be held liable as a contributory infringer. Even if Defendants do not know
exactly when games will be uploaded to or downloaded from the MAPHIA bulletin board, their role in the
copying, including provision of facilities, direction, knowledge and encouragement, amounts to contributory
copyright infringement.

Defendants raise fair use as a defense to copyright infringement. However, to invoke the fair use exception,
an individual must possess an authorized copy of a literary work." Defendant Scherman has stated that he does
not own any Sega game cartridges. When copying is for the purpose of making multiple copies of the original,
and thereby saving users the expense of purchasing additional authorized copies, this militates against a
finding of fair use under the purpose of the use factor. Because users of the MAPHIA bulletin board are
likely and encouraged to download Sega games therefrom to avoid having to buy video game cartridges from
Sega, by which avoidance such users and Defendants both profit, the commercial purpose and character of the
unauthorized copying weighs against a finding of fair use.

Because Sega video game programs are for entertainment uses and involve fiction and fantasy, consideration
of the nature of the copyrighted work weighs against a finding of fair use. Because it appears that the entire
game programs are copied when Sega video game programs are transferred over the MAPHIA bulletin board,
consideration of the amount and substantiality of the portion copied weighs against a finding of fair use. "The
fourth factor, the effect of the use upon the market for or value of the copyrighted work, 'is undoubtedly the
single most important element of fair use.'" "[T]o negate fair use one need only show that if the challenged use
'should become widespread, it would adversely affect the potential market for the copyrighted work.' Based
on Defendants' own statement that 45,000 bulletin boards like MAPHIA operate in this country, it is obvious
that should the unauthorized copying of Sega's video games by Defendants and others become widespread,
there would be a substantial and immeasurable adverse effect on the market for Sega's copyrighted video
game programs. Consideration of the effect on the market for Sega's copyrighted works weighs heavily
against a finding of fair use.

Q. You can’t play pirated games in Playstation. Someone invents a chip to allow you to use it. Is this
infringement?
A. No. Violates no moral rights. However, WIPO treaty provides that there should be legislatioin against anti-
circumvention devices. This is such a devise. Another example of an ACD is a devise which disables visitor-
counting devices in websites.

Q. Is viewing (such as when you play a program or view a tape) infringement?


A. No. It’s private use. If you view it yourself, it’s okay. Even if you share it with barangay. But if you sell
the chips to video stores which has 100 consoles, it may be considered contributory infringement.
Allan Verman Ong Intellectual Property Law: Cram Another Day 21
SY 2002-2003
NOTE: There is a difference between a infringing copy and a non-infringing copy.

NOTE: Software is reproduced when you use it. It is reproduced in your Random Access Memory.

RELIGIOUS TECHNOLOGY CENTER v. NETCOM ON-LINE COMMUNICATION SERVICES

Plaintiffs Religious Technology Center ("RTC") and Bridge Publications, Inc. ("BPI") hold copyrights in the unpublished and
published works of L. Ron Hubbard, the late founder of the Church of Scientology ("the Church"). Defendant Dennis Erlich
is a former minister of Scientology turned vocal critic of the Church, whose pulpit is now the Usenet newsgroup
alt.religion.scientology ("a.r.s."), an on-line forum for discussion and criticism of Scientology. Plaintiffs maintain that Erlich
infringed their copyrights when he posted portions of their works on a.r.s. Erlich gained his access to the Internet through
defendant Thomas Klemesrud's ("Klemesrud's") BBS "support.com." Klemesrud is the operator of the BBS, which is run out
of his home and has approximately 500 paying users. Klemesrud's BBS is not directly linked to the Internet, but gains its
connection through the facilities of defendant Netcom On-Line Communications, Inc. ("Netcom"), one of the largest
providers of Internet access in the United States.

After failing to convince Erlich to stop his postings, plaintiffs contacted defendants Klemesrud and Netcom. Klemesrud
responded to plaintiffs' demands that Erlich be kept off his system by asking plaintiffs to prove that they owned the
copyrights to the works posted by Erlich. However, plaintiffs refused Klemesrud's request as unreasonable. Netcom similarly
refused plaintiffs' request that Erlich not be allowed to gain access to the Internet through its system. Netcom contended
that it would be impossible to prescreen Erlich's postings and that to kick Erlich off the Internet meant kicking off the
hundreds of users of Klemesrud's BBS. Consequently, plaintiffs named Klemesrud and Netcom in their suit against Erlich,
although only on the copyright infringement claims.

Unlike some other large on-line service providers, such as CompuServe, America Online, and Prodigy, Netcom does not create
or control the content of the information available to its subscribers. It also does not monitor messages as they are posted.
It has, however, suspended the accounts of subscribers who violated its terms and conditions, such as where they had
commercial software in their posted files. Netcom admits that, although not currently configured to do this, it may be
possible to reprogram its system to screen postings containing particular words or coming from particular individuals.
Netcom, however, took no action after it was told by plaintiffs that Erlich had posted messages through Netcom's system
that violated plaintiffs' copyrights, instead claiming that it could not shut out Erlich without shutting out all of the users of
Klemesrud's BBS.

Held: FIRST the purpose and character of the defendant's use. Netcom's use of plaintiffs' work is to carry
out its commercial function as an Internet access provider. Such a use, regardless of the underlying uses made
by Netcom's subscribers, is clearly commercial. Netcom's use, though commercial, also benefits the public in
allowing for the functioning of the Internet and the dissemination of other creative works, a goal of the
Copyright Act. Although Netcom gains financially from its distribution of messages to the Internet, its
financial incentive is unrelated to the infringing activity and the defendant receives no direct financial benefit
from the acts of infringement. Therefore, the commercial nature of the defendant's activity should not be
dispositive. Moreover, there is no easy way for a defendant like Netcom to secure a license for carrying every
possible type of copyrighted work onto the Internet. Thus, it should not be seen as "profit[ing] from the
exploitation of the copyrighted work without paying the customary prices." Because Netcom's use of
copyrighted materials served a completely different function than that of the plaintiffs, this factor weighs in
Netcom's favor.

SECOND: whether it is published or unpublished and whether it is informational or creative. Plaintiffs rely on
the fact that some of the works transmitted by Netcom were unpublished and some were arguably highly
creative and original. However, because Netcom's use of the works was merely to facilitate their posting to
the Usenet, which is an entirely different purpose than plaintiffs' use (or, for the matter, Erlich's use), the
precise nature of whose works is not important to the fair use determination.

THIRD concerns both the percentage of the original work that was copied and whether that portion
constitutes the "heart" of the copyrighted work. Generally, no more of a work may be copied than is necessary
Allan Verman Ong Intellectual Property Law: Cram Another Day 22
SY 2002-2003
for the particular use. The copying of an entire work will ordinarily militate against a finding of fair use,
although this is not a per se rule. Plaintiffs have shown that Erlich's posting copied substantial amounts of the
originals or, in some cases, the entire works. Netcom, of course, made available to the Usenet exactly what was
posted by Erlich. As the court found in Sony, the mere fact that all of a work is copied is not determinative of
the fair use question, where such total copying is essential given the purpose of the copying. Id. (allowing total
copying in context of time-shifting copyrighted television shows by home viewers). Here, Netcom copied no
more of plaintiffs' works than necessary to function as a Usenet server. Accordingly, this factor should not
defeat an otherwise valid defense.

FOURTH "the extent of market harm caused by the particular actions of the alleged infringer" and "whether
unrestricted and widespread conduct of the sort engaged in by the defendant . . . would result in a
substantially adverse impact on the potential market' for the original." Netcom argues that there is no
evidence that making accessible plaintiffs' works, which consist of religious scriptures and policy letters, will
harm the market for these works by preventing someone from participating in the Scientology religion because
they can view the works on the Internet instead. Further, Netcom notes that the relevant question is whether
the posting fulfill the demand of an individual who seeks to follow the religion's teachings, and not whether
they suppress the desire of an individual who is affected by the criticism posted by Erlich. Netcom argues
that the court must focus on the "normal market" for the copyrighted work, which in this case is through a
Scientology-based organization. Plaintiffs respond that the Internet's extremely widespread distribution--
where more than 25 million people worldwide have access--multiplies the effects of market substitution. In
support of its motion for a preliminary injunction against Erlich, plaintiffs submitted declarations regarding
the potential effect of making the Church's secret scriptures available over the Internet. Plaintiffs pointed
out that, although the Church currently faces no competition, groups in the past have used stolen copies of the
Church's scriptures in charging for Scientology-like religious training. This evidence raises a genuine issue as
to the possibility that Erlich's postings, made available over the Internet by Netcom, could hurt the market
for plaintiffs' works.

In balancing the various factors, the court finds that there is a question of fact as to whether there is a valid
fair use defense. Netcom has not justified its copying plaintiffs' works to the extent necessary to establish
entitlement to summary judgment in light of evidence that it knew that Erlich's use was infringing and had the
ability to prevent its further distribution. While copying all or most of a work will often preclude fair use,
courts have recognized the fair use defense where the purpose of the use is beneficial to society, complete
copying is necessary given the type of use, the purpose of the use is completely different than the purpose of
the original, and there is no evidence that the use will significantly harm the market for the original. This case
is distinguishable from those cases recognizing fair use despite total copying. In Sony, the home viewers' use
was not commercial and the viewers were allowed to watch the entire shows for free. Here, plaintiffs never
gave either Erlich or Netcom permission to view or copy their works. Netcom's use has some commercial
aspects. Further, Netcom's copying is not for the purpose of getting to the unprotected idea behind
plaintiffs' works. Although plaintiffs may ultimately lose on their infringement claims if, among other things,
they cannot prove that posting their copyrighted works will harm the market for these works. Fair use
presents a factual question on which plaintiffs have at least raised a genuine issue of fact. Accordingly, the
court does not find that Netcom's use was fair as a matter of law.

NOTE: Digital works – the moment you post materials on the site (internet site) it is considered non-
copyrightable unless you place the fact of its being copyrighted in a conspicuous place in the site.

SEC. 186. WORK OF ARCHITECTURE. - COPYRIGHT IN A WORK OF ARCHITECTURE SHALL INCLUDE THE RIGHT TO CONTROL THE ERECTION OF

ANY BUILDING WHICH REPRODUCES THE WHOLE OR A SUBSTANTIAL PART OF THE WORK EITHER IN ITS ORIGINAL FORM OR IN ANY FORM

RECOGNIZABLY DERIVED FROM THE ORIGINAL; PROVIDED, THAT THE COPYRIGHT IN ANY SUCH WORK SHALL NOT INCLUDE THE RIGHT TO

CONTROL THE RECONSTRUCTION OR REHABILITATION IN THE SAME STYLE AS THE ORIGINAL OF A BUILDING TO WHICH THE COPYRIGHT

RELATES. (N)
Allan Verman Ong Intellectual Property Law: Cram Another Day 23
SY 2002-2003

SEC. 187. REPRODUCTION OF PUBLISHED WORK. -

187.1. NOTWITHSTANDING THE PROVISION OF SECTION 177, AND SUBJECT TO THE PROVISIONS OF SUBSECTION 187.2, THE

PRIVATE REPRODUCTION OF A PUBLISHED WORK IN A SINGLE COPY, WHERE THE REPRODUCTION IS MADE BY A NATURAL PERSON

EXCLUSIVELY FOR RESEARCH AND PRIVATE STUDY, SHALL BE PERMITTED, WITHOUT THE AUTHORIZATION OF THE OWNER OF COPYRIGHT IN

THE WORK.

187.2. THE PERMISSION GRANTED UNDER SUBSECTION 187.1 SHALL NOT EXTEND TO THE REPRODUCTION OF:
(A) A WORK OF ARCHITECTURE IN FORM OF BUILDING OR OTHER CONSTRUCTION;
(B) AN ENTIRE BOOK, OR A SUBSTANTIAL PAST THEREOF, OR OF A MUSICAL WORK IN WHICH GRAPHICS FORM BY
REPROGRAPHIC MEANS;

(C) A COMPILATION OF DATA AND OTHER MATERIALS;


(D) A COMPUTER PROGRAM EXCEPT AS PROVIDED IN SECTION 189; AND
(E) ANY WORK IN CASES WHERE REPRODUCTION WOULD UNREASONABLY CONFLICT WITH A NORMAL EXPLOITATION OF THE
WORK OR WOULD OTHERWISE UNREASONABLY PREJUDICE THE LEGITIMATE INTERESTS OF THE AUTHOR. (N)

SEC. 188. REPROGRAPHIC REPRODUCTION BY LIBRARIES. -


188.1. NOTWITHSTANDING THE PROVISIONS OF SUBSECTION 177.6, ANY LIBRARY OR ARCHIVE WHOSE ACTIVITIES ARE NOT FOR
PROFIT MAY, WITHOUT THE AUTHORIZATION OF THE AUTHOR OF COPYRIGHT OWNER, MAKE A SINGLE COPY OF THE WORK BY

REPROGRAPHIC REPRODUCTION:

(A) WHERE THE WORK BY REASON OF ITS FRAGILE CHARACTER OR RARITY CANNOT BE LENT TO USER IN ITS ORIGINAL FORM;
(B) WHERE THE WORKS ARE ISOLATED ARTICLES CONTAINED IN COMPOSITE WORKS OR BRIEF PORTIONS OF OTHER PUBLISHED
WORKS AND THE REPRODUCTION IS NECESSARY TO SUPPLY THEM; WHEN THIS IS CONSIDERED EXPEDIENT, TO PERSON

REQUESTING THEIR LOAN FOR PURPOSES OF RESEARCH OR STUDY INSTEAD OF LENDING THE VOLUMES OR BOOKLETS WHICH

CONTAIN THEM; AND

(C) WHERE THE MAKING OF SUCH A COPY IS IN ORDER TO PRESERVE AND, IF NECESSARY IN THE EVENT THAT IT IS LOST,

DESTROYED OR RENDERED UNUSABLE, REPLACE A COPY, OR TO REPLACE, IN THE PERMANENT COLLECTION OF ANOTHER SIMILAR

LIBRARY OR ARCHIVE, A COPY WHICH HAS BEEN LOST, DESTROYED OR RENDERED UNUSABLE AND COPIES ARE NOT AVAILABLE

WITH THE PUBLISHER.

188.2. NOTWITHSTANDING THE ABOVE PROVISIONS, IT SHALL NOT BE PERMISSIBLE TO PRODUCE A VOLUME OF A WORK PUBLISHED IN

SEVERAL VOLUMES OR TO PRODUCE MISSING TOMES OR PAGES OF MAGAZINES OR SIMILAR WORKS, UNLESS THE VOLUME, TOME OR PART

IS OUT OF STOCK; PROVIDED, THAT EVERY LIBRARY WHICH, BY LAW, IS ENTITLED TO RECEIVE COPIES OF A PRINTED WORK, SHALL BE

ENTITLED, WHEN SPECIAL REASONS SO REQUIRE, TO REPRODUCE A COPY OF A PUBLISHED WORK WHICH IS CONSIDERED NECESSARY FOR

THE COLLECTION OF THE LIBRARY BUT WHICH IS OUT OF STOCK.

SEC. 189. REPRODUCTION OF COMPUTER PROGRAM. -


189.1. NOTWITHSTANDING THE PROVISIONS OF SECTION 177, THE REPRODUCTION IN ONE (1) BACK-UP COPY OR ADAPTATION OF A
COMPUTER PROGRAM SHALL BE PERMITTED, WITHOUT THE AUTHORIZATION OF THE AUTHOR OF, OR OTHER OWNER OF COPYRIGHT IN, A

COMPUTER PROGRAM, BY THE LAWFUL OWNER OF THAT COMPUTER PROGRAM: PROVIDED, THAT THE COPY OR ADAPTATION IS NECESSARY

FOR:

(A) THE USE OF THE COMPUTER PROGRAM IN CONJUNCTION WITH A COMPUTER FOR THE PURPOSE, AND TO THE EXTENT, FOR
WHICH THE COMPUTER PROGRAM HAS BEEN OBTAINED; AND

(B) ARCHIVAL PURPOSES, AND, FOR THE REPLACEMENT OF THE LAWFULLY OWNED COPY OF THE COMPUTER PROGRAM IN THE
EVENT THAT THE LAWFULLY OBTAINED COPY OF THE COMPUTER PROGRAM IS LOST, DESTROYED OR RENDERED UNUSABLE.

189.2. NO COPY OR ADAPTATION MENTIONED IN THIS SECTION SHALL BE USED FOR ANY PURPOSE OTHER THAN THE ONES DETERMINED

IN THIS SECTION, AND ANY SUCH COPY OR ADAPTATION SHALL BE DESTROYED IN THE EVENT THAT CONTINUED POSSESSION OF THE

COPY OF THE COMPUTER PROGRAM CEASES TO BE LAWFUL.


Allan Verman Ong Intellectual Property Law: Cram Another Day 24
SY 2002-2003
189.3. THIS PROVISION SHALL BE WITHOUT PREJUDICE TO THE APPLICATION OF SECTION 185 WHENEVER APPROPRIATE. ( N)

Computer programs – also just one copy, for 1. Back-up


2. Archival purposes

SEC. 190. IMPORTATION FOR PERSONAL PURPOSES. -


190.1. NOTWITHSTANDING THE PROVISION OF SUBSECTION 177.6, BUT SUBJECT TO THE LIMITATION UNDER THE SUBSECTION
185.2, THE IMPORTATION OF A COPY OF A WORK BY AN INDIVIDUAL FOR HIS PERSONAL PURPOSES SHALL BE PERMITTED WITHOUT THE
AUTHORIZATION OF THE AUTHOR OF, OR OTHER OWNER OF COPYRIGHT IN, THE WORK UNDER THE FOLLOWING CIRCUMSTANCES:

(A) WHEN COPIES OF THE WORK ARE NOT AVAILABLE IN THE PHILIPPINES AND:
(I) NOT MORE THAN ONE (1) COPY AT ONE TIME IS IMPORTED FOR STRICTLY INDIVIDUAL USE ONLY; OR (II) THE
IMPORTATION IS BY AUTHORITY OF AND FOR THE USE OF THE PHILIPPINE GOVERNMENT; OR

(III) THE IMPORTATION, CONSISTING OF NOT MORE THAN THREE (3) SUCH COPIES OR LIKENESSES IN ANY ONE
INVOICE, IS NOT FOR SALE BUT FOR THE USE ONLY OF ANY RELIGIOUS, CHARITABLE, OR EDUCATIONAL SOCIETY OR

INSTITUTION DULY INCORPORATED OR REGISTERED, OR IS FOR THE ENCOURAGEMENT OF THE FINE ARTS, OR FOR

ANY STATE SCHOOL, COLLEGE, UNIVERSITY, OR FREE PUBLIC LIBRARY IN THE PHILIPPINES.

(B) WHEN SUCH COPIES FORM PARTS OF LIBRARIES AND PERSONAL BAGGAGE BELONGING TO PERSONS OR FAMILIES ARRIVING
FROM FOREIGN COUNTRIES AND ARE NOT INTENDED FOR SALE: PROVIDED, THAT SUCH COPIES DO NOT EXCEED THREE (3).

190.2. COPIES IMPORTED AS ALLOWED BY THIS SECTION MAY NOT LAWFULLY BE USED IN ANY WAY TO VIOLATE THE RIGHTS OF OWNER

THE COPYRIGHT OR ANNUL OR LIMIT THE PROTECTION SECURED BY THIS ACT, AND SUCH UNLAWFUL USE SHALL BE DEEMED AN

INFRINGEMENT AND SHALL BE PUNISHABLE AS SUCH WITHOUT PREJUDICE TO THE PROPRIETOR’S RIGHT OF ACTION.

190.3. SUBJECT TO THE APPROVAL OF THE SECRETARY OF FINANCE, THE COMMISSIONER OF CUSTOMS IS HEREBY EMPOWERED TO

MAKE RULES AND REGULATIONS FOR PREVENTING THE IMPORTATION OF ARTICLES THE IMPORTATION OF WHICH IS PROHIBITED UNDER

THIS SECTION AND UNDER TREATIES AND CONVENTIONS TO WHICH THE PHILIPPINES MAY BE A PARTY AND FOR SEIZING AND

CONDEMNING AND DISPOSING OF THE SAME IN CASE THEY ARE DISCOVERED AFTER THEY HAVE BEEN IMPORTED.

CHAPTER IX
DEPOSIT AND NOTICE

SEC. 191. REGISTRATION AND DEPOSIT WITH NATIONAL LIBRARY SUPREME COURT LIBRARY.- AFTER THE FIRST PUBLIC
AND THE

DISSEMINATION OF PERFORMANCE BY AUTHORITY OF THE COPYRIGHT OWNER OF A WORK FALLING UNDER SUBSECTIONS 172.1, 172.2 AND
172.3 OF THIS ACT, THERE SHALL, FOR THE PURPOSE OF COMPLETING THE RECORDS OF THE NATIONAL LIBRARY AND THE SUPREME COURT
LIBRARY, WITHIN THREE (3) WEEKS, BE REGISTERED AND DEPOSITED WITH IT, BY PERSONAL DELIVERY OR BY REGISTERED MAIL, TWO (2)
COMPLETE COPIES OR REPRODUCTIONS OF THE WORK IN SUCH FORM AS THE DIRECTORS OF SAID LIBRARIES MAY PRESCRIBE. A CERTIFICATE OF

DEPOSIT SHALL BE ISSUED FOR WHICH THE PRESCRIBED FEE SHALL BE COLLECTED AND THE COPYRIGHT OWNER SHALL BE EXEMPT FROM MAKING

ADDITIONAL DEPOSIT OF THE WORKS WITH THE NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY UNDER OTHER LAWS. IF, WITHIN

THREE (3) WEEKS AFTER RECEIPT BY THE COPYRIGHT OWNER OF A WRITTEN DEMAND FROM THE DIRECTORS FOR SUCH DEPOSIT, THE REQUIRED

COPIES OR REPRODUCTIONS ARE NOT DELIVERED AND THE FEE IS NOT PAID, THE COPYRIGHT OWNER SHALL BE LIABLE TO PAY A FINE

EQUIVALENT TO THE REQUIRED FEE PER MONTH OF DELAY AND TO PAY TO THE NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY THE

AMOUNT OF THE RETAIL PRICE OF THE BEST EDITION OF THE WORK. ONLY THE ABOVE MENTIONED CLASSES OF WORK SHALL BE ACCEPTED FOR

DEPOSIT BY THE NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY.

SEC. 192. NOTICE OF COPYRIGHT. - EACH COPY OF A WORK PUBLISHED OR OFFERED FOR SALE MAY CONTAIN A NOTICE BEARING THE NAME

OF THE COPYRIGHT OWNER, AND THE YEAR OF ITS FIRST PUBLICATION, AND, IN COPIES PRODUCED AFTER THE CREATOR’S DEATH, THE YEAR OF

SUCH DEATH.

Q. Is the existence of a certificate proof of the existence of copyright?


Allan Verman Ong Intellectual Property Law: Cram Another Day 25
SY 2002-2003
A. No. That’s all it is, a certificate of deposit. It was important before, especially in Santos v. McCullough
Printer Co, 12 SCRA 321 (1964) when registration was needed to obtain a copyright. Here, Mauro Malang
registered his copyright of his painting after his “copyright” was violated (his painting was used for greeting
cards for two years, only one year was agreed upon). Since he didn’t register before the second printing, he
lost his case. Under the IP Code now, You do not need registration in the National Library to get copyright
protection.

Q. Who issues the certificate?


A. National Library and Supreme Court.

Q. What kind of works are deposited?


A. In the drafting of the code, Atty. Chris Lim suggested to the drafters:
1. National Library – only the 1st 3 in the list (books, letters, articles, letter) since these are the only
things that can benefit the collection of the Nat’l Lib.
2. Supreme Court – only works related to the law
But the law actually says, all works are to be deposited.

Q. What is the significance of certificate?


A. Just says that you deposited; NO PRESUMPTION ARISES AS TO COPYRIGHT OWNERSHIP.

Q. Does the National Library review if work is copyrightable subject matter?


A. No. All it certifies is that you deposited two copies there.

Q. So how do you prove copyright ownership if you file cases?


A. You file an affidavit evidence under Sec. 218.

CHAPTER X
MORAL RIGHTS

SEC. 193. SCOPE OF MORAL RIGHTS. - THE AUTHOR OF A WORK SHALL, INDEPENDENTLY OF THE ECONOMIC RIGHTS IN SECTION 177 OR

THE GRANT OF AN ASSIGNMENT OR LICENSE WITH RESPECT TO SUCH RIGHT, HAVE THE RIGHT:

193.1. TO REQUIRE THAT THE AUTHORSHIP OF THE WORKS BE ATTRIBUTED TO HIM, IN PARTICULAR, THE RIGHT THAT HIS NAME, AS

FAR AS PRACTICABLE, BE INDICATED IN A PROMINENT WAY ON THE COPIES, AND IN CONNECTION WITH THE PUBLIC USE OF HIS WORK;

193.2. TO MAKE ANY ALTERATIONS OF HIS WORK PRIOR TO, OR TO WITHHOLD IT FROM PUBLICATION;
193.3. TO OBJECT TO ANY DISTORTION, MUTILATION OR OTHER MODIFICATION OF, OR OTHER DEROGATORY ACTION IN RELATION TO,

HIS WORK WHICH WOULD BE PREJUDICIAL TO HIS HONOR OR REPUTATION; AND

193.4. TO RESTRAIN THE USE OF HIS NAME WITH RESPECT TO ANY WORK NOT OF HIS OWN CREATION OR IN A DISTORTED VERSION OF

HIS WORK. (SEC. 34, P. D. NO. 49)

Moral rights can also be denominated as follows:


1. Paternity – attributing ownership to someone
2. Privacy – the right to withhold publication
3. [Right against] False Attribution
4. [Right to] Integrity

NOTE: There are certain instances that although the creator’s moral rights are violated, it would be
better not to enforce them. For instance, Atty. Lim gave the example of the author of the Cocodile Files
(expose of the Coconut Levy Funds which says it belongs to Danding Cojuanco), who found works authored
by another, saying that the funds are public funds (which virtually means a recantation).
Allan Verman Ong Intellectual Property Law: Cram Another Day 26
SY 2002-2003
If he were to enforce his rights and file a complaint (civil or criminal) he would be subjecting himself
to criminal prosecution, since he would have to testify that he is the author of the Cocodile Files!

SEC. 194. BREACH OF CONTRACT. - AN AUTHOR CANNOT BE COMPELLED TO PERFORM HIS CONTRACT TO CREATE A WORK OR FOR THE

PUBLICATION OF HIS WORK ALREADY IN EXISTENCE. HOWEVER, HE MAY BE HELD LIABLE FOR DAMAGES FOR BREACH OF SUCH CONTRACT.

SEC. 195. WAIVER OF MORAL RIGHTS. - AN AUTHOR MAY WAIVE HIS RIGHTS MENTIONED IN SECTION 193 BY A WRITTEN INSTRUMENT,

BUT NO SUCH WAIVER SHALL BE VALID WHERE ITS EFFECTS IS TO PERMIT ANOTHER:

195.1. TO USE THE NAME OF THE AUTHOR, OR THE TITLE OF HIS WORK, OR OTHERWISE TO MAKE USE OF HIS REPUTATION WITH

RESPECT TO ANY VERSION OR ADAPTATION OF HIS WORK WHICH, BECAUSE OF ALTERATIONS THEREIN, WOULD SUBSTANTIALLY TEND TO

INJURE THE LITERARY OR ARTISTIC REPUTATION OF ANOTHER AUTHOR; OR

195.2. TO USE THE NAME OF THE AUTHOR WITH RESPECT TO A WORK HE DID NOT CREATE.

SEC. 196. CONTRIBUTION TO COLLECTIVE WORK. - WHEN AN AUTHOR CONTRIBUTES TO A COLLECTIVE WORK, HIS RIGHT TO HAVE HIS

CONTRIBUTION ATTRIBUTED TO HIM IS DEEMED WAIVED UNLESS HE EXPRESSLY RESERVES IT.

SEC. 197. EDITING, ARRANGING AND ADAPTATION OF WORK. - IN THE ABSENCE OF A CONTRARY STIPULATION AT THE TIME AN AUTHOR

LICENSES OR PERMITS ANOTHER TO USE HIS WORK, THE NECESSARY EDITING, ARRANGING OR ADAPTATION OF SUCH WORK, FOR PUBLICATION,

BROADCAST, USE IN A MOTION PICTURE, DRAMATIZATION, OR MECHANICAL OR ELECTRICAL REPRODUCTION IN ACCORDANCE WITH THE

REASONABLE AND CUSTOMARY STANDARDS OR REQUIREMENTS OF THE MEDIUM IN WHICH THE WORK IS TO BE USED, SHALL NOT BE DEEMED TO

CONTRAVENE THE AUTHOR'S RIGHTS SECURED BY THIS CHAPTER. NOR SHALL COMPLETE DESTRUCTION OF A WORK UNCONDITIONALLY

TRANSFERRED BY THE AUTHOR BE DEEMED TO VIOLATE SUCH RIGHTS.

SEC. 198. TERM OF MORAL RIGHTS. -


198.1. THE RIGHTS OF AN AUTHOR UNDER THIS CHAPTER SHALL LAST DURING THE LIFETIME OF THE AUTHOR AND FOR FIFTY (50)
YEARS AFTER HIS DEATH AND SHALL NOT BE ASSIGNABLE OR SUBJECT TO LICENSE. THE PERSON OR PERSONS TO BE CHARGED WITH THE

POSTHUMOUS ENFORCEMENT OF THESE RIGHTS SHALL BE NAMED IN WRITING TO BE FILED WITH THE NATIONAL LIBRARY. IN DEFAULT

OF SUCH PERSON OR PERSONS, SUCH ENFORCEMENT SHALL DEVOLVE UPON EITHER THE AUTHOR'S HEIRS, AND IN DEFAULT OF THE HEIRS,

THE DIRECTOR OF THE NATIONAL LIBRARY.

198.2. FOR PURPOSES OF THIS SECTION, "PERSON" SHALL MEAN ANY INDIVIDUAL, PARTNERSHIP, CORPORATION, ASSOCIATION, OR

SOCIETY. THE DIRECTOR OF THE NATIONAL LIBRARY MAY PRESCRIBE REASONABLE FEES TO BE CHARGED FOR HIS SERVICES IN THE

APPLICATION OF PROVISIONS OF THIS SECTION. (SEC. 39, P. D. NO. 49)

SEC. 199. ENFORCEMENT REMEDIES. - VIOLATION CHAPTER SHALL ENTITLE THOSE CHARGED
OF ANY OF THE RIGHTS CONFERRED BY THIS

WITH THEIR ENFORCEMENT TO THE SAME RIGHTS AND REMEDIES AVAILABLE TO A COPYRIGHT OWNER. IN ADDITION, DAMAGES WHICH MAY BE
AVAILED OF UNDER THE CIVIL CODE MAY ALSO BE RECOVERED. ANY DAMAGE RECOVERED AFTER THE CREATOR'S DEATH SHALL BE HELD IN

TRUST FOR AND REMITTED TO HIS HEIRS, AND IN DEFAULT OF THE HEIRS, SHALL BELONG TO THE GOVERNMENT. (SEC. 40, P. D. NO. 49)

CHAPTER XI
RIGHTS TO PROCEEDS IN SUBSEQUENT TRANSFERS

SEC. 200. SALE OR LEASE OF WORK. - IN EVERY SALE OR LEASE OF AN ORIGINAL WORK OF PAINTING OR SCULPTURE OR OF THE ORIGINAL

MANUSCRIPT OF A WRITER OR COMPOSER, SUBSEQUENT TO THE FIRST DISPOSITION THEREOF BY THE AUTHOR, THE AUTHOR OR HIS HEIRS

SHALL HAVE AN INALIENABLE RIGHT TO PARTICIPATE IN THE GROSS PROCEEDS OF THE SALE OR LEASE TO THE EXTENT OF FIVE PERCENT (5%).
THIS RIGHT SHALL EXIST DURING THE LIFETIME OF THE AUTHOR AND FOR FIFTY (50) YEARS AFTER HIS DEATH. (SEC. 31, P. D. NO. 49)
Allan Verman Ong Intellectual Property Law: Cram Another Day 27
SY 2002-2003
SEC. 201. WORKS NOT COVERED. - THE PROVISIONS OF THIS CHAPTER SHALL NOT APPLY TO PRINTS, ETCHINGS, ENGRAVINGS, WORKS OF
APPLIED ART, OR WORKS OF SIMILAR KIND WHEREIN THE AUTHOR PRIMARILY DERIVES GAIN FROM THE PROCEEDS OF REPRODUCTIONS. (SEC.

33, P. D. NO. 49)

CHAPTER XII
RIGHTS OF PERFORMERS, PRODUCERS OF SOUNDS
RECORDINGS AND BROADCASTING ORGANIZATIONS

Neighboring Rights – performer’s rights are also called “neighboring rights.” This is because when a song
composed by X, and is performed by Y is produced, it is X, as the composer, who has the copyright. Y has no
copyright. He did not create the song, he just interpreted it. His right is to his interpretation, a neighboring
right to the copyright of the composer.

Berne Convention – prescribed the rights of creators

TRIPS Agreement – here, performer’s rights are called “related rights”

So when you record the rendition of Nick Carter of Baby Face’s song “Take a Bow,” you violate three rights:
1. composer – the copyright
2. performer – the neighboring rights
3. broadcaster – his neighboring rights

NOTE: ATTY. LIM SAYS, STUDY SCOPE OF PERFORMER’S AND PRODUCER’S RIGHTS, WILL COME OUT IN THE EXAM.

SEC. 202. DEFINITIONS. - FOR THE PURPOSE OF THIS ACT, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
202.1. "PERFORMERS" ARE ACTORS, SINGERS, MUSICIANS, DANCERS, AND OTHER PERSONS WHO ACT, SING, DECLAIM, PLAY IN,

INTERPRET, OR OTHERWISE PERFORM LITERARY AND ARTISTIC WORK;

202.2. "SOUND RECORDING" MEANS THE FIXATION OF THE SOUNDS OF A PERFORMANCE OR OF OTHER SOUNDS, OR REPRESENTATION
OF SOUND, OTHER THAN IN THE FORM OF A FIXATION INCORPORATED IN A CINEMATOGRAPHIC OR OTHER AUDIOVISUAL WORK;

202.3. AN "AUDIOVISUAL WORK OR FIXATION" IS A WORK THAT CONSISTS OF A SERIES OF RELATED IMAGES WHICH IMPART THE

IMPRESSION OF MOTION, WITH OR WITHOUT ACCOMPANYING SOUNDS, SUSCEPTIBLE OF BEING MADE VISIBLE AND, WHERE ACCOMPANIED

BY SOUNDS, SUSCEPTIBLE OF BEING MADE AUDIBLE;

202.4. "FIXATION" MEANS THE EMBODIMENT OF SOUNDS, OR OF THE REPRESENTATIONS THEREOF, FROM WHICH THEY CAN BE

PERCEIVED, REPRODUCED OR COMMUNICATED THROUGH A DEVICE;

202.5. "PRODUCER OF A SOUND RECORDING" MEANS THE PERSON, OR THE LEGAL ENTITY, WHO OR WHICH TAKES THE INITIATIVE AND

HAS THE RESPONSIBILITY FOR THE FIRST FIXATION OF THE SOUNDS OF A PERFORMANCE OR OTHER SOUNDS, OR THE REPRESENTATION OF

SOUNDS;

202.6. "PUBLICATION OF A FIXED PERFORMANCE OR A SOUND RECORDING" MEANS THE OFFERING OF COPIES OF THE FIXED

PERFORMANCE OR THE SOUND RECORDING TO THE PUBLIC, WITH THE CONSENT OF THE RIGHT HOLDER: PROVIDED, THAT COPIES ARE

OFFERED TO THE PUBLIC IN REASONABLE QUALITY;

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;


Allan Verman Ong Intellectual Property Law: Cram Another Day 28
SY 2002-2003
202.8. "BROADCASTING ORGANIZATION" SHALL INCLUDE A NATURAL PERSON OR A JURIDICAL ENTITY DULY AUTHORIZED TO ENGAGE IN

BROADCASTING; AND

202.9. "COMMUNICATION TO THE PUBLIC OF A PERFORMANCE OR A SOUND RECORDING" MEANS THE TRANSMISSION TO THE PUBLIC, BY
ANY MEDIUM, OTHERWISE THAN BY BROADCASTING, OF SOUNDS OF A PERFORMANCE OR THE REPRESENTATIONS OF SOUNDS FIXED IN A

SOUND RECORDING. FOR PURPOSES OF SECTION 209, "COMMUNICATION TO THE PUBLIC" INCLUDES MAKING THE SOUNDS OR

REPRESENTATIONS OF SOUNDS FIXED IN A SOUND RECORDING AUDIBLE TO THE PUBLIC.

SEC. 203. SCOPE OF PERFORMERS' RIGHTS. - SUBJECT TO THE PROVISIONS OF SECTION 212, PERFORMERS SHALL ENJOY THE FOLLOWING

EXCLUSIVE RIGHTS:

203.1. AS REGARDS THEIR PERFORMANCES, THE RIGHT OF AUTHORIZING:


(A) THE BROADCASTING AND OTHER COMMUNICATION TO THE PUBLIC OF THEIR PERFORMANCE; AND

(B) THE FIXATION OF THEIR UNFIXED PERFORMANCE.

203.2. THE RIGHT OF AUTHORIZING THE DIRECT OR INDIRECT REPRODUCTION OF THEIR PERFORMANCES FIXED IN SOUND RECORDINGS,

IN ANY MANNER OR FORM;

203.3. SUBJECT TO THE PROVISIONS OF SECTION 206, THE RIGHT OF AUTHORIZING THE FIRST PUBLIC DISTRIBUTION OF THE

ORIGINAL AND COPIES OF THEIR PERFORMANCE FIXED IN THE SOUND RECORDING THROUGH SALE OR RENTAL OR OTHER FORMS OF

TRANSFER OF OWNERSHIP;

203.4. THE RIGHT OF AUTHORIZING THE COMMERCIAL RENTAL TO THE PUBLIC OF THE ORIGINAL AND COPIES OF THEIR PERFORMANCES

FIXED IN SOUND RECORDINGS, EVEN AFTER DISTRIBUTION OF THEM BY, OR PURSUANT TO THE AUTHORIZATION BY THE PERFORMER; AND

203.5. THE RIGHT OF AUTHORIZING THE MAKING AVAILABLE TO THE PUBLIC OF THEIR PERFORMANCES FIXED IN SOUND RECORDINGS, BY

WIRE OR WIRELESS MEANS, IN SUCH A WAY THAT MEMBERS OF THE PUBLIC MAY ACCESS THEM FROM A PLACE AND TIME INDIVIDUALLY

CHOSEN BY THEM.

SEC. 204. MORAL RIGHTS OF PERFORMERS. -


204.1. INDEPENDENTLY OF A PERFORMER'S ECONOMIC RIGHTS, THE PERFORMER, SHALL, AS REGARDS HIS LIVE AURAL PERFORMANCES OR

PERFORMANCES FIXED IN SOUND RECORDINGS, HAVE THE RIGHT TO CLAIM TO BE IDENTIFIED AS THE PERFORMER OF HIS PERFORMANCES,

EXCEPT WHERE THE OMISSION IS DICTATED BY THE MANNER OF THE USE OF THE PERFORMANCE, AND TO OBJECT TO ANY DISTORTION,

MUTILATION OR OTHER MODIFICATION OF HIS PERFORMANCES THAT WOULD BE PREJUDICIAL TO HIS REPUTATION.

204.2. THE RIGHTS GRANTED TO A PERFORMER IN ACCORDANCE WITH SUBSECTION 203.1 SHALL BE MAINTAINED AND EXERCISED
FIFTY (50) YEARS AFTER HIS DEATH, BY HIS HEIRS, AND IN DEFAULT OF HEIRS, THE GOVERNMENT, WHERE PROTECTION IS CLAIMED.

SEC. 205. LIMITATION ON RIGHT. -


205.1. SUBJECT TO THE PROVISIONS OF SECTION 206, ONCE THE PERFORMER HAS AUTHORIZED THE BROADCASTING OR FIXATION OF

HIS PERFORMANCE, THE PROVISIONS OF SECTIONS 203 SHALL HAVE NO FURTHER APPLICATION.

205.2. THE PROVISIONS OF SECTION 184 AND SECTION 185 SHALL APPLY MUTATIS MUTANDIS TO PERFORMERS. (N)

SEC. 206. ADDITIONAL REMUNERATION FOR SUBSEQUENT COMMUNICATIONS OR BROADCASTS. - UNLESS OTHERWISE PROVIDED IN THE
CONTRACT, IN EVERY COMMUNICATION TO THE PUBLIC OR BROADCAST OF A PERFORMANCE SUBSEQUENT TO THE FIRST COMMUNICATION OR

BROADCAST THEREOF BY THE BROADCASTING ORGANIZATION, THE PERFORMER SHALL BE ENTITLED TO AN ADDITIONAL REMUNERATION

EQUIVALENT TO AT LEAST FIVE PERCENT (5%) OF THE ORIGINAL COMPENSATION HE OR SHE RECEIVED FOR THE FIRST COMMUNICATION OR

BROADCAST. (N)

SEC. 207. CONTRACT TERMS. - NOTHING IN THIS CHAPTER SHALL BE CONSTRUED TO DEPRIVE PERFORMERS OF THE RIGHT TO AGREE BY

CONTRACTS ON TERMS AND CONDITIONS MORE FAVORABLE FOR THEM IN RESPECT OF ANY USE OF THEIR PERFORMANCE. (N)
Allan Verman Ong Intellectual Property Law: Cram Another Day 29
SY 2002-2003

CHAPTER XIII
PRODUCERS OF SOUND RECORDINGS

SEC. 208. SCOPE OF RIGHT. - SUBJECT TO THE PROVISIONS OF SECTION 212, PRODUCERS OF SOUND RECORDINGS SHALL ENJOY THE

FOLLOWING EXCLUSIVE RIGHTS:

208.1. THE RIGHT TO AUTHORIZE THE DIRECT OR INDIRECT REPRODUCTION OF THEIR SOUND RECORDINGS, IN ANY MANNER OR FORM;

THE PLACING OF THESE REPRODUCTIONS IN THE MARKET AND THE RIGHT OF RENTAL OR LENDING;

208.2. THE RIGHT TO AUTHORIZE THE FIRST PUBLIC DISTRIBUTION OF THE ORIGINAL AND COPIES OF THEIR SOUND RECORDINGS

THROUGH SALE OR RENTAL OR OTHER FORMS OF TRANSFERRING OWNERSHIP; AND

208.3. THE RIGHT TO AUTHORIZE THE COMMERCIAL RENTAL TO THE PUBLIC OF THE ORIGINAL AND COPIES OF THEIR SOUND

RECORDINGS, EVEN AFTER DISTRIBUTION BY THEM BY OR PURSUANT TO AUTHORIZATION BY THE PRODUCER.

SEC. 209. COMMUNICATION TO THE PUBLIC. - IF A SOUND RECORDING PUBLISHED FOR COMMERCIAL PURPOSES, OR A REPRODUCTION OF
SUCH SOUND RECORDING, IS USED DIRECTLY FOR BROADCASTING OR FOR OTHER COMMUNICATION TO THE PUBLIC, OR IS PUBLICLY PERFORMED

WITH THE INTENTION OF MAKING AND ENHANCING PROFIT, A SINGLE EQUITABLE REMUNERATION FOR THE PERFORMER OR PERFORMERS, AND

THE PRODUCER OF THE SOUND RECORDING SHALL BE PAID BY THE USER TO BOTH THE PERFORMERS AND THE PRODUCER, WHO, IN THE ABSENCE

OF ANY AGREEMENT SHALL SHARE EQUALLY.

SEC. 210. LIMITATION OF RIGHT. - SECTIONS 184 AND 185 SHALL APPLY MUTATIS MUTANDIS TO THE PRODUCER OF SOUND RECORDINGS.

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;

211.2. THE RECORDING IN ANY MANNER, INCLUDING THE MAKING OF FILMS OR THE USE OF VIDEO TAPE, OF THEIR BROADCASTS FOR

THE PURPOSE OF COMMUNICATION TO THE PUBLIC OF TELEVISION BROADCASTS OF THE SAME; AND

211.3. THE USE OF SUCH RECORDS FOR FRESH TRANSMISSIONS OR FOR FRESH RECORDING.

CHAPTER XV
LIMITATIONS ON PROTECTION

SEC. 212. LIMITATIONS ON RIGHTS. - SECTIONS 203, 208 AND 209 SHALL NOT APPLY WHERE THE ACTS REFERRED TO IN THOSE

SECTIONS ARE RELATED TO:


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.

CHAPTER XVI
TERM OF PROTECTION

SEC. 213. TERM OF PROTECTION. –

213.1. SUBJECT TO THE PROVISIONS OF SUBSECTIONS 213.2 TO 213.5, THE COPYRIGHT IN WORKS UNDER SECTIONS 172 AND 173
SHALL BE PROTECTED DURING THE LIFE OF THE AUTHOR AND FOR FIFTY (50 YEARS AFTER HIS DEATH. THIS RULE ALSO APPLIES TO
POSTHUMOUS WORKS.
Allan Verman Ong Intellectual Property Law: Cram Another Day 30
SY 2002-2003

213.2. IN CASE OF WORKS OF JOINT AUTHORSHIP, THE ECONOMIC RIGHTS SHALL BE PROTECTED DURING THE LIFE OF THE LAST

SURVIVING AUTHOR AND FOR FIFTY (50) YEARS AFTER HIS DEATH.

213.3. IN CASE OF ANONYMOUS OR PSEUDONYMOUS WORKS, THE COPYRIGHT SHALL BE PROTECTED FOR FIFTY (50) YEARS FROM THE
DATE ON WHICH THE WORK WAS FIRST LAWFULLY PUBLISHED: PROVIDED, THAT WHERE, BEFORE THE EXPIRATION OF THE SAID PERIOD,
THE AUTHOR'S IDENTITY IS REVEALED OR IS NO LONGER IN DOUBT, THE PROVISIONS OF SUBSECTIONS 213.1 AND 213.2 SHALL APPLY,

AS THE CASE MAY BE: PROVIDED, FURTHER, THAT SUCH WORKS IF NOT PUBLISHED BEFORE SHALL BE PROTECTED FOR FIFTY (50) YEARS

COUNTED FROM THE MAKING OF THE WORK.

213.4. IN CASE OF WORKS OF APPLIED ART THE PROTECTION SHALL BE FOR A PERIOD OF TWENTY-FIVE (25) YEARS FROM THE DATE OF

MAKING.

213.5. IN CASE OF PHOTOGRAPHIC WORKS, THE PROTECTION SHALL BE FOR FIFTY (50) YEARS FROM PUBLICATION OF THE WORK AND,

IF UNPUBLISHED, FIFTY (50) YEARS FROM THE MAKING.

213.6. IN CASE OF AUDIO-VISUAL WORKS INCLUDING THOSE PRODUCED BY PROCESS ANALOGOUS TO PHOTOGRAPHY OR ANY PROCESS FOR

MAKING AUDIO-VISUAL RECORDINGS, THE TERM SHALL BE FIFTY (50) YEARS FROM DATE OF PUBLICATION AND, IF UNPUBLISHED, FROM

THE DATE OF MAKING.

SEC. 214. CALCULATION OF TERM. - THE TERM OF PROTECTION SUBSEQUENT TO THE DEATH OF THE AUTHOR PROVIDED IN THE PRECEDING
SECTION SHALL RUN FROM THE DATE OF HIS DEATH OR OF PUBLICATION, BUT SUCH TERMS SHALL ALWAYS BE DEEMED TO BEGIN ON THE FIRST
DAY OF JANUARY OF THE YEAR FOLLOWING THE EVENT WHICH GAVE RISE TO THEM.

SEC. 215. TERM OF PROTECTION FOR PERFORMERS, PRODUCERS AND BROADCASTING ORGANIZATIONS. -
215.1. THE RIGHTS GRANTED TO PERFORMERS AND PRODUCERS OF SOUND RECORDINGS UNDER THIS LAW SHALL EXPIRE:
(A) FOR PERFORMANCES NOT INCORPORATED IN RECORDINGS, FIFTY (50) YEARS FROM THE END OF THE YEAR IN WHICH THE
PERFORMANCE TOOK PLACE; AND

(B) FOR SOUND OR IMAGE AND SOUND RECORDINGS AND FOR PERFORMANCES INCORPORATED THEREIN, FIFTY (50) YEARS
FROM THE END OF THE YEAR IN WHICH THE RECORDING TOOK PLACE.

215.2. IN CASE OF BROADCASTS, THE TERM SHALL BE TWENTY (20) YEARS FROM THE DATE THE BROADCAST TOOK PLACE. THE
EXTENDED TERM SHALL BE APPLIED ONLY TO OLD WORKS WITH SUBSISTING PROTECTION UNDER THE PRIOR LAW.

CHAPTER XVII
INFRINGEMENT

SEC. 216. REMEDIES FOR INFRINGEMENT. -


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 INTO THE CHANNELS OF COMMERCE OF IMPORTED GOODS THAT

INVOLVE AN INFRINGEMENT, IMMEDIATELY AFTER CUSTOMS CLEARANCE OF SUCH GOODS.

(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.
Allan Verman Ong Intellectual Property Law: Cram Another Day 31
SY 2002-2003
(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)

Infringement – doing an act pertaining to copyrighted works that one is not authorized to do.

Elements/What must be Proven


1. act is unauthorized
2. copyright exists  original
3. access (person knows or ought to know that work is copyrighted)
4. copying took place

Q. No injury = no crime?
A. Hmm… Seems like it.

Q. Getting a search warrant in criminal cases. What do you want in SW?


A. You want to:
1. Seize goods – seize the infringing copies so damage (lost sales) will stop immediately
2. Seize equipment used for reproduction
3. Seize documents to prove sales (to compute actual damages) and to find out his real source.

SEC. 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.

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;
Allan Verman Ong Intellectual Property Law: Cram Another Day 32
SY 2002-2003
(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.

Q. Is good faith a valid defense in copyright infringement?


A. The law clearly provides when one does not know or it is impossible to know that the copy is infringed, good faith is a
defense. However, only the act of possession can be protected with good faith. After the sale, there is no longer
possession. Therefore, whether the person knows that the DVDs are counterfeit or not, he can be punished. It is true that
the RPC provides that good faith (or mistake of fact) does not apply since the IP Code is a special law. Mistake of fact is a
defense only in crimes mala in se. Violations of the IP Code are mala prohibitum. However, the IP code provides an
exception. N. B. It is thus very important to do controlled buys, in order to do away with the good faith
defense.

SEC. 218. AFFIDAVIT EVIDENCE. -


218.1. IN AN ACTION UNDER THIS CHAPTER, AN AFFIDAVIT MADE BEFORE A NOTARY PUBLIC BY OR ON BEHALF OF THE OWNER OF THE

COPYRIGHT IN ANY WORK OR OTHER SUBJECT MATTER AND STATING THAT:

(A) AT THE TIME SPECIFIED THEREIN, COPYRIGHT SUBSISTED IN THE WORK OR OTHER SUBJECT MATTER;
(B) HE OR THE PERSON NAMED THEREIN IS THE OWNER OF THE COPYRIGHT; AND
(C) THE COPY OF THE WORK OR OTHER SUBJECT MATTER ANNEXED THERETO IS A TRUE COPY THEREOF, SHALL BE ADMITTED IN
EVIDENCE IN ANY PROCEEDINGS FOR AN OFFENSE UNDER THIS CHAPTER AND SHALL BE PRIMA FACIE PROOF OF THE MATTERS

THEREIN STATED UNTIL THE CONTRARY IS PROVED, AND THE COURT BEFORE WHICH SUCH AFFIDAVIT IS PRODUCED SHALL

ASSUME THAT THE AFFIDAVIT WAS MADE BY OR ON BEHALF OF THE OWNER OF THE COPYRIGHT.

218.2. IN AN ACTION UNDER THIS CHAPTER.


(A) COPYRIGHT SHALL BE PRESUMED TO SUBSIST IN THE WORK OR OTHER SUBJECT MATTER TO WHICH THE ACTION RELATES

IF THE DEFENDANT DOES NOT PUT IN ISSUE THE QUESTION WHETHER COPYRIGHT SUBSISTS IN THE WORK OR OTHER SUBJECT

MATTER; AND

(B) WHERE THE SUBSISTENCE OF THE COPYRIGHT IS ESTABLISHED, THE PLAINTIFF SHALL BE PRESUMED TO BE THE OWNER OF

THE COPYRIGHT IF HE CLAIMS TO BE THE OWNER OF THE COPYRIGHT AND THE DEFENDANT DOES NOT PUT IN ISSUE THE

QUESTION OF HIS OWNERSHIP.

(C) WHERE THE DEFENDANT, WITHOUT GOOD FAITH, PUTS IN ISSUE THE QUESTIONS OF WHETHER COPYRIGHT SUBSISTS IN

A WORK OR OTHER SUBJECT MATTER TO WHICH THE ACTION RELATES, OR THE OWNERSHIP OF COPYRIGHT IN SUCH WORK OR

SUBJECT MATTER, THEREBY OCCASIONING UNNECESSARY COSTS OR DELAY IN THE PROCEEDINGS, THE COURT MAY DIRECT THAT

ANY COSTS TO THE DEFENDANT IN RESPECT OF THE ACTION SHALL NOT BE ALLOWED BY HIM AND THAT ANY COSTS

OCCASIONED BY THE DEFENDANT TO OTHER PARTIES SHALL BE PAID BY HIM TO SUCH OTHER PARTIES. ( N)

SEC. 219. PRESUMPTION OF AUTHORSHIP. -


219.1. THE NATURAL PERSON WHOSE NAME IS INDICATED ON A WORK IN THE USUAL MANNER AS THE AUTHOR SHALL, IN THE ABSENCE

OF PROOF TO THE CONTRARY, BE PRESUMED TO BE THE AUTHOR OF THE WORK. THIS PROVISION SHALL BE APPLICABLE EVEN IF THE NAME

IS A PSEUDONYM, WHERE THE PSEUDONYM LEAVES NO DOUBT AS TO THE IDENTITY OF THE AUTHOR.

219.2. THE PERSON OR BODY, CORPORATE WHOSE NAME APPEARS ON AN AUDIO-VISUAL WORK IN THE USUAL MANNER SHALL, IN THE

ABSENCE OF PROOF TO THE CONTRARY, BE PRESUMED TO BE THE MAKER OF SAID WORK. ( N)

SEC. 220. INTERNATIONAL REGISTRATION OF WORKS. - A STATEMENT CONCERNING A WORK, RECORDED IN AN INTERNATIONAL REGISTER

IN ACCORDANCE WITH AN INTERNATIONAL TREATY TO WHICH THE PHILIPPINES IS OR MAY BECOME A PARTY, SHALL BE CONSTRUED AS TRUE

UNTIL THE CONTRARY IS PROVED EXCEPT:

220.1. WHERE THE STATEMENT CANNOT BE VALID UNDER THIS ACT OR ANY OTHER LAW CONCERNING INTELLECTUAL PROPERTY.
Allan Verman Ong Intellectual Property Law: Cram Another Day 33
SY 2002-2003
220.2. WHERE THE STATEMENT IS CONTRADICTED BY ANOTHER STATEMENT RECORDED IN THE INTERNATIONAL REGISTER.

JOAQUIN V. DRILON

Petitioner BJ Productions, Inc. was the holder/grantee of a Certificate of Copyright of Rhoda and Me, a dating game show
aired from 1970 to 1977. On 1973, BJ Productions, Inc. submitted to the National Library an addendum to its Certificate of
Copyright specifying the show's format and style of presentation. Sometime in 1991, BJ Productions, Inc. discovered that
another television show, It's a Date, with a similar format to Rhoda and Me was being aired on RPN Channel 9. It's a Date
was produced by IXL Productions, Inc. BJ Productions, Inc. then wrote a letter to the president of IXL Productions, Inc.
Informing them that BJ Productions, Inc. had a copyright to Rhoda and Me and demanding that IXL Productions, Inc.
discontinue airing It's a Date. IXL Productions, Inc. sought a meeting with BJ Productions, but nevertheless continued airing
It's a Date. Meanwhile, IXL Productions, Inc. sought to register IXL's copyright to the first episode of It's a Date for
which it was issued by the National Library a Certificate of Copyright on 14 August 1991.

Upon complaint of BJ Productions, Inc., an information for violation of P.D. No.49 was filed against the officers of IXL
Productions, Inc. and RPN Channel 9. However, upon the petition of IXL Productions, Inc., the complaint was eventually
dismissed Secretary of Justice Franklin Drilon. BJ Productions, Inc. then filed a petition with the Supreme Court
questioning this decision of Secretary Drilon. Respondents dismissed the case on the ground that petitioners had failed to
establish probable cause because of their failure to present the copyrighted master tapes of Rhoda and Me. Petitioners, on
the other hand, claim that the presentation of the master tapes was not necessary, since written descriptions of the
formats of the two television shows were presented during the preliminary investigation. It was also from these descriptions
that the investigating prosecutor found substantial similarities and ruled that there was indeed infringement of copyright,
as the two shows were practically exact copies of the other. Respondents in this case also contend that BJ Production,
Inc.'s copyright covers only a specific episode of Rhoda and Me and that the formats or concepts of dating game shows are
not covered by copyright protection under P .D. No.49. Petitioners, on the other hand, asserted that the format of Rhoda
and Me is a product of ingenuity and skill and is thus entitled to copyright protection.

Held: The format of a show is not copyrightable. Section 2 of P.D. No.49 enumerates the classes of work
entitled to copyright protection. Notably, the format or mechanics of a television show is not included in this
list of protected works. Copyright, being a statutory right, the right is 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. For this reason, the protection afforded by the law cannot be extended to cover
them.

Section 2 of P.D. No.49, 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 work48. No protection shall extend 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
work49. It is therefore clear that under law, the format of a dating game show falls under what is referred to
as "unprotected subject matter".

BJ Production, Inc.'s copyright covers only the audio-visual recordings of each episode of Rhoda and Me, as
falling within the class of works mentioned in Section 2 of P.D. No.49, to wit: cinematographic works and works
produced by a process analogous to cinematography or any process for making audio-visual recordings. This
being th8' case, the Court ruled that the master tape should have been presented to provide the investigating
prosecutor the opportunity to compare the videotapes of the two shows. The Court held that

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 shows.

Joaquin v. Drilon – It is very difficult to prove reproduction of plays and shows unless there is EXACT copying.
Allan Verman Ong Intellectual Property Law: Cram Another Day 34
SY 2002-2003
HABANA V. ROBLES

This case involves the question of plagiarism and the possible infringement of copyrighted materials in a textbook.
Petitioners Pacita Habana, Alicia Cinco and Jovita Fernando are the authors and copyright owner.s of duly issued certificates
of copyright registration covering their published works, College English for Today, Books 1 and 2, and Workbook for College
Freshman English, Series 1. Respondents Felicidad Robles and Goodwill Trading Co., Inc. are the author/publisher and
distributor/seller of another published work entitled "Developing English Proficiency", Books 1 and 2, which book was
covered by copyrights issued to them.

In the course of revising their published works, petitioners discovered that respondent's books were strikingly to the
contents, scheme or presentation, illustrations and illustrative examples in their own book. Petitioners found that several
pages of the respondent's book are similar, if not all together a copy of petitioner's book, which is a case of plagiarism and
copyright infringement. After their demand that respondent pay damages and cease and desist from selling the infringing
copies of respondent's book went unheeded, petitioners filed a compliant for infringement and unfair competition against
the respondent.

Held: Respondent's act of lifting from the book of petitioners substantial portions of discussions and
examples, and her failure to acknowledge the same in her book is an infringement of petitioner's copyright. As
to substantial reproduction of a book, it does not necessarily require that the entire copyrighted work, or even
a large portion of it, be copied. If so much is taken that the value of the original work is substantially
diminished, there is an infringement of copyright and to an injurious extent, the work is appropriated.

In determining the question of infringement, the amount of matter copied from the copyrighted work, is an important
consideration. To constitute infringement, it is not necessary that the whole or even a large portion of the work shall have
been copied. If so much is taken that the value of the original is sensibly diminished, or the labours of the original author are
substantially and to an injurious extent appropriated by another, that is sufficient in point of law to constitute piracy.

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 [is conferred by statute on the owner of the copyright On the respondent's claim that the copied portions of the book
do not constitute copyright infringement since these are also found in foreign books and other grammar books and that the
similarity between their styles can not be avoided since they come from the same background and orientation, the Supreme
Court held that this would be true had the respondent mentioned the source and the name of the author in her book.

Thus, 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 peril52. Nevertheless, one who copies or quotes from a published work will not be held
to be guilty of copyright infringement where he mentions the source and the name of the author of the
published work.

To what extent can copying be injurious to the author of the book being copied? In this case, the Court held
that the fact that the numerous pages that the petitioners presented showing similarity in the style and the
manner the books were presented and the identical examples is a mark of copying and cannot pass as
similarities. Also, even if the petitioners and the respondent were of the same background in terms of teaching
and orientation, the Court held that it was not an excuse for them to be identical even in the examples
contained in their books.

Lastly, the Court found indicia of guilt on the part of the respondent. In this case, the Court found
that the respondent had pulled out from Goodwill bookstores her book upon learning of petitioners' complaint
while denying petitioners' demand. The Court further noted that when the respondent's book was re-issued as
a revised version, all the pages cited by petitioners to contain portion of their book were conspicuously
eliminated.
Allan Verman Ong Intellectual Property Law: Cram Another Day 35
SY 2002-2003
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.

Hence, there is a clear case of appropriation of copyrighted work for her benefit that respondent Robles committed.
Petitioner's work as authors is the product of their long and assiduous research and for another to represent it as her own
is injury enough. In copyrighting books the purpose is to give protection to the intellectual product of an author. This is
precisely what the law on copyright protected.

Q. HABANA – civil case; Joaquin – criminal case; Why?


A. In computer CD crimes – you need immediate relief, that is, seizure of products so you can stop sales and
your loss of profits. In TV shows, civil case maybe because it’s harder to prove anyway and no immediate relief
can be obtained. Injunction is all that you can get.

Q. A provincial cable company without license to broadcast Star Channels picked out the signal and
broadcasted. What action would you recommend?
A. Criminal, so you can seize broadcast equipment. If you file civil case and get an injunction, by the time you
get it, equipment would have been moved and they would be broadcasting from a different office. You need to
get the equipment fast.

Administrative cases
Filed against manufacturers AND retailers.

Q. Jurisdiction?
A. 200K above – Intellectual Property Office
200K below – DTI’s Bureau of Trade Regulation and Consumer Protection.

Q. Could you give me the basic provisions governing administrative cases?


A. (In the immortal words of Johnbee Sison) Certainly.

RULES AND REGULATIONS ON ADMINISTRATIVE COMPLAINTS FOR VIOLATION OF LAWS


INVOLVING INTELLECTUAL PROPERTY RIGHTS

Rule 1
DEFINITIONS, INTERPRETATION, RULES OF COURT

Sec. 2. Interpretation. — These Regulations shall be liberally construed to carry out the objectives of the IP
Code and IP Laws and to assist the parties in obtaining just and expeditious settlement or disposition of
administrative cases filed before the Office.

Rule 2
COMMENCEMENT OF ACTION

Section 1. Complaint, When and to Whom Filed. — All administrative complaints for violation of the IP
Code or IP Laws shall be commenced by filing a verified complaint with the Bureau within four (4) years
from the date of commission of the violation, or if the date be unknown, from the date of discovery of the
violation.

The complaint shall include a certification that the party commencing the action has not filed any other
action or proceeding involving the same issue or issues before any tribunal or agency nor such action or
proceeding is pending in other quasi-judicial bodies: Provided, however, that if any such action is
pending, the status of the same must be stated, and should knowledge thereof be acquired after the filing
of the complaint…. Failure to comply with the foregoing requirements shall not be curable by mere
Allan Verman Ong Intellectual Property Law: Cram Another Day 36
SY 2002-2003
amendment of the complaint or other initiatory pleading but shall be cause for dismissal of the case
without prejudice.

Sec. 2. Original Jurisdiction. — (a) The Bureau shall have original jurisdiction in administrative actions for
violations of laws involving intellectual property rights where the total damages claimed are not less than
two hundred thousand pesos (P200,000.00); Provided however, that availment of the provisional remedies
may be granted in accordance with these Regulations and the provisions of the Rules of Court; The
Director shall coordinate with local enforcement agencies for the strict and effective implementation and
enforcement of these Regulations.

The commencement of the action under these Rules and Regulations is independent and without
prejudice to the filing of any action with the regular courts.

Rule 3
POWERS OF HEARING OFFICERS

Section 1. Powers of Hearing Officers. — (a) A Hearing Officer conducting the hearing and investigating
shall be empowered to administer oaths and affirmations; issue subpoena and subpoena duces tecum to
compel attendance of parties and witnesses and the production of any book, paper, document,
correspondence and other records which are material to the case; grant provisional remedies in
accordance with these Regulations and the Rules of Court; and make preliminary rulings on questions
raised at the hearings, with the ultimate decision on the merits of all the issues involved being left to the
Director.

Rule 4
PRELIMINARY ATTACHMENT

Rule 5
PRELIMINARY INJUNCTION

Rule 6
CONTEMPT

Rule 7
CALENDAR AND ADJOURNMENTS

Rule 8
DEPOSITIONS AND DISCOVERIES

Rule 9
HEARING

Rule 10
EVIDENCE

Section 1. Evidence Required. — Substantial evidence shall be sufficient to support decision or order. A
fact may be deemed established if it is supported by substantial evidence. It means such relevant
evidence which a reasonable mind might accept as adequate to support or justify a conclusion.

Rule 11
DECISIONS AND ORDERS

Section 1. Rendition of Decision. — (a) The case is deemed submitted for resolution upon termination of
the period for reception of evidence provided in Section 1 of Rule 9 and the evidence formally offered.
Whether or not the parties submit a final pleading such as memorandum, the case shall be decided by
the Bureau within thirty (30) calendar days from submission as provided herein.
Allan Verman Ong Intellectual Property Law: Cram Another Day 37
SY 2002-2003
All decisions determining the merits of cases shall be in writing, stating clearly and distinctly the facts
and law on which they are based and signed by the Director.
(b) Decisions and final orders shall be saved by mail, personal service or publication as the case may
require.

Rule 12
ADMINISTRATIVE PENALTIES AND SANCTIONS

Section 1. Administrative Penalties Imposable. — After formal investigation, the Director, may impose one
(1) or more of the following administrative penalties:

(a) Issuance of a cease and desist order which shall specify the acts that the respondent shall
cease and desist from and shall require him to submit a compliance report.…

(b) The acceptance of a voluntary assurance of compliance or discontinuance as may be imposed.

(c) The condemnation or seizure of products which are subject of the offense.

(d) The forfeiture of paraphernalia and all real and personal properties which have been used in
the commission of the offense.

(e) The imposition of administrative fines in such amount as deemed reasonable by the Director,
which shall in no case be less than P5,000.00

(f) The cancellation of any permit, license, authority, or registration which may have been granted
by the Office, or the suspension of the validity thereof not exceeding one (1) year.

(g) The withholding of any permit, license, authority or registration which is being secured by the
respondent from the Office;

(h) The assessment and award of damages;

(i) Censure

Rule 13
JUDGMENTS, FINAL ORDERS AND ENTRY THEREOF

Section 1. Rendition of Judgment and Final Orders. — A judgment or final order determining the merits of
the case shall be in writing, stating clearly and distinctly the facts and the law on which it is based,
signed by the Director, and filed with the appropriate Register of the Office.

Sec. 2. Entry of judgments and Final Orders. — If no appeal is filed within the time provided in these
Regulations, the Director shall forthwith cause the entry of the judgment or final order in the appropriate
Register of the Office. The date of finality of the judgment or final order shall be deemed to be the date of
its entry. The record shall contain the dispositive part of the judgment or final order and shall be signed
by the Director, with a certificate that such judgment or final order has become final and executory.

Rule 14
APPEAL

Section 1. Finality of Decision and Order. — (a) The decision and order of the Director shall become final
and executory fifteen (15) days after the receipt of a copy thereof by the party affected unless within the
said period an appeal to the Director General has been perfected.

(b) Decisions of the Director-General shall be final and executory unless an appeal to the Court of Appeals
or Supreme Court is perfected in accordance with the Rules of Court applicable to appeals from decision
of Regional Trial Courts.

(d) No motion for reconsideration of the decision of the Director General shall be allowed.
Allan Verman Ong Intellectual Property Law: Cram Another Day 38
SY 2002-2003
Sec. 2. Appeal, How Perfected. — Appeal may be perfected by filing a Notice of Appeal with the Director
General and the Director and a copy thereof served upon the adverse party within fifteen (15) days from
receipt of the order or Decision and upon payment of the corresponding docket fee.

Q. Can administrative agencies impose damages?


A. Yes. There is no limit as to the amount of damages it may award. But it may not impose imprisonment.

Q. What kind of determination does the agency make, does it determine guilt?
A. Yes! Without a determination of guilt (or at least, violation), it can’t impose penalties.

Q. Describe the appeals process.


A. Administrative Agency  CA  SC

Q. Is there any disadvantage in filing the case with an administrative agency?


A. Yes. Administrative agencies are hesitant to award large amounts of damages, since this is the court’s job,
and also because the losing party can file an administrative case against him in the Sandiganbayan for
malfeasance. In this case, the government does not defend him. So he is hesitant even to grant temporary
relief like injunctions.

Q. Why would you file a case with an administrative agency rather than regular courts?
A. to make sure that the IP issues are appreciated. But if case is clear cut, go to RTC. Decisions of the RTC
have more weight because administrative cases are summary and is not bound by the technical rules on
evidence. There is more chance that the IPO case will be reversed on appeal.

Q. What kind of cases does the IPO hear?


A. IP code cases. But RTC hears all sorts of cases, so they have lesser competence as to IP laws. Note that in
major cities though, there are some courts assigned to hear only IP cases.

Summary of Crim/Civ/Admi Pros and Cons


Criminal Civil Administrative
• Hardest to prove – requires proof • File this when you have to prove • File this only when your case is
beyond reasonable doubt. substantial copying (case is not 100% against retailers and you don’t expect
- Note that in software copying) and when there is possibility to obtain substantial damages.
piracy, this is easier that fair use will be raised as a defense
because there is an • It takes VERY long to get an
actual 100% injunction so if you need immediate
reproduction relief, don’t file this.
• Immediate relief is needed by seizure • Not as expensive for the client.
of means of production. So even if • The entire battle is fought at the
case goes on for 20 years, he can’t getting of the injunction. Bulk of the
manufacture fakes evidence is presented here. If no
• Most expensive for the client injunction is obtained, it will be simple
because you pay trademark matter for the other party to keep
investigators to do the test purchases, extending the case (and keep selling
so police will file for SW. At the pirated stuff while case is pending)
Prelim Inves stage, accused will quash
SW to claim that evidence obtained is
inadmissible. Will also question finding
of probable cause by fiscal to DOJ
• Important to pay for storage so
evidence seized will not be lost.
Delivery under oath – can be done even in civil cases, so no need to get seizure in civil case
- to get documents evidencing a) sourcing of goods (to get the big cat)
Allan Verman Ong Intellectual Property Law: Cram Another Day 39
SY 2002-2003
b) sales (to prove amount of actual damages)

Civil ex parte searches and seizures – provided for in the TRIPS Agreement
- did not specify if for civil, criminal, or administrative suits
- purposes 1) to prevent evidence from disappearing
2) to prevent infringed goods from entering the commerce of man

Developing Countries – criminal cases already allow ex parte searches


- should be available in civil cases also
- called the “Anton Pillar” order – allows goods to be searched and seized which are subject of
criminal action without need of filing criminal case
- apply for it in customs and go there (port) and seize

Q. Is possession of copyrighted goods punishable?


A. No. But it is criminally punished when it falls under Sec. 217.3 and possessor knows or ought to know that
such is copyrighted. Note thought that it is hard to overcome presumption of this knowledge that work is
copyrighted.

Q. Does the doctrine of exhaustion of administrative relief apply? Do you have to file administrative case
before you file civil/criminal case?
A. No. You can file any case, civil, administrative or criminal.

CHAPTER XVIII
SCOPE OF APPLICATION

SEC. 221. POINTS OF ATTACHMENT FOR WORKS UNDER SECTIONS 172 AND 173. -
221.1. THE PROTECTION AFFORDED BY THIS ACT TO COPYRIGHTABLE WORKS UNDER SECTIONS 172 AND 173 SHALL APPLY TO:
(A) WORKS OF AUTHORS WHO ARE NATIONALS OF, OR HAVE THEIR HABITUAL RESIDENCE IN THE PHILIPPINES;
(B) AUDIO-VISUAL WORKS THE PRODUCER OF WHICH HAS HIS HEADQUARTERS OR HABITUAL RESIDENCE IN THE PHILIPPINES;
(C) WORKS OF ARCHITECTURE ERECTED IN THE PHILIPPINES OR OTHER ARTISTIC WORKS INCORPORATED IN A BUILDING OR
OTHER STRUCTURE LOCATED IN THE PHILIPPINES;

(D) WORKS FIRST PUBLISHED IN THE PHILIPPINES; AND


(E) WORKS FIRST PUBLISHED IN ANOTHER COUNTRY BUT ALSO PUBLISHED IN THE PHILIPPINES WITHIN THIRTY DAYS,
IRRESPECTIVE OF THE NATIONALITY OR RESIDENCE OF THE AUTHORS.

221.2. THE PROVISIONS OF THIS ACT SHALL ALSO APPLY TO WORKS THAT ARE TO BE PROTECTED BY VIRTUE OF AND IN ACCORDANCE

WITH ANY INTERNATIONAL CONVENTION OR OTHER INTERNATIONAL AGREEMENT TO WHICH THE PHILIPPINES IS A PARTY. (N)

Q. Should the author be the one to cause the publication of the work for his work to obtain protection?
A. No. The law does not make a distinction.

Q. A book is published in China by a Chinese. Is it possible for him to obtain protection in RP?
A. Yes. He should publish in RP within 30 days. He does not need to be a Filipino or a resident of RP to obtain
the protection.

Q. What if you are not able to publish within the 30 day window, can you ever obtain protection?
A. Yes. If you are a national of a country which ratified the TRIPS or the Berne Convention, the treaty
provisions require that protection be extended to all citizens of signatory countries. Therefore, if you publish
in Japan, you are automatically given protection in RP.
Allan Verman Ong Intellectual Property Law: Cram Another Day 40
SY 2002-2003
Q. What if you publish in a non-member country like China, and you miss the 30 day window in the Philippines?
How can you obtain copyright protection in TRIPS or Berne Convention signatory countries?
A. Simply publish in a country which ratified the TRIPS but allows for longer period for publication than 30
days.

SEC. 222. POINTS OF ATTACHMENT FOR PERFORMERS. - THE PROVISIONS OF THIS ACT ON THE PROTECTION OF PERFORMERS SHALL APPLY
TO:

222.1. PERFORMERS WHO ARE NATIONALS OF THE PHILIPPINES;


222.2. PERFORMERS WHO ARE NOT NATIONALS OF THE PHILIPPINES BUT WHOSE PERFORMANCES:
(A) TAKE PLACE IN THE PHILIPPINES; OR
(B) ARE INCORPORATED IN SOUND RECORDINGS THAT ARE PROTECTED UNDER THIS ACT; OR
(C) WHICH HAS NOT BEEN FIXED IN SOUND RECORDING BUT ARE CARRIED BY BROADCAST QUALIFYING FOR PROTECTION UNDER
THIS ACT. (N)

SEC. 223. POINTS OF ATTACHMENT FOR SOUND RECORDINGS. - THE PROVISIONS OF THIS ACT ON THE PROTECTION OF SOUND

RECORDINGS SHALL APPLY TO:

223.1. SOUND RECORDINGS THE PRODUCERS OF WHICH ARE NATIONALS OF THE PHILIPPINES; AND

223.2. SOUND RECORDINGS THAT WERE FIRST PUBLISHED IN THE PHILIPPINES. (N)

SEC. 224. POINTS OF ATTACHMENT FOR BROADCASTS. -


224.1. THE PROVISIONS OF THIS ACT ON THE PROTECTION OF BROADCASTS SHALL APPLY TO:
(A) BROADCASTS OF BROADCASTING ORGANIZATIONS THE HEADQUARTERS OF WHICH ARE SITUATED IN THE PHILIPPINES;
AND

(B) BROADCASTS TRANSMITTED FROM TRANSMITTERS SITUATED IN THE PHILIPPINES.


224.2. THE PROVISIONS OF THIS ACT SHALL ALSO APPLY TO PERFORMERS WHO, AND TO PRODUCERS OF SOUND RECORDINGS AND

BROADCASTING ORGANIZATIONS WHICH, ARE TO BE PROTECTED BY VIRTUE OF AND IN ACCORDANCE WITH ANY INTERNATIONAL

CONVENTION OR OTHER INTERNATIONAL AGREEMENT TO WHICH THE PHILIPPINES IS A PARTY. (N)

N. B. United States is a first to register jurisdiction. You obtain copyright by registration.


RP is a first to create jurisdiction. You obtain copyright by virtue of creation.
The Berne Convention reinforces the first to create doctrine. US is not a signatory of the Berne.

CHAPTER XIX
INSTITUTION OF ACTIONS

SEC. 225. JURISDICTION. - WITHOUT PREJUDICE TO THE PROVISIONS OF SUBSECTION 7.1(C), ACTIONS UNDER THIS ACT SHALL BE

COGNIZABLE BY THE COURTS WITH APPROPRIATE JURISDICTION UNDER EXISTING LAW.

SEC. 226. DAMAGES. - NO DAMAGES MAY BE RECOVERED UNDER THIS ACT AFTER FOUR (4) YEARS FROM THE TIME THE CAUSE OF ACTION

AROSE.

Prescriptive periods:
Civil case – 4 years
Criminal case – follow the RPC based on penalty (i.e., length of imprisonment, amount of fine)

CHAPTER XX
MISCELLANEOUS PROVISIONS
Allan Verman Ong Intellectual Property Law: Cram Another Day 41
SY 2002-2003
SEC. 227. OWNERSHIP OF DEPOSIT AND INSTRUMENTS. - ALL COPIES DEPOSITED AND INSTRUMENTS IN WRITING FILED WITH THE
NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT SHALL BECOME THE PROPERTY
OF THE GOVERNMENT.

SEC. 228. PUBLIC RECORDS. - THE SECTION OR DIVISION OF THE NATIONAL LIBRARY AND THE SUPREME COURT LIBRARY CHARGED WITH
RECEIVING COPIES AND INSTRUMENTS DEPOSITED AND WITH KEEPING RECORDS REQUIRED UNDER THIS ACT AND EVERYTHING IN IT SHALL BE
OPENED TO PUBLIC INSPECTION. THE DIRECTOR OF THE NATIONAL LIBRARY IS EMPOWERED TO ISSUE SUCH SAFEGUARDS AND REGULATIONS

AS MAY BE NECESSARY TO IMPLEMENT THIS SECTION AND OTHER PROVISIONS OF THIS ACT.

Sec. 229. Copyright Division Fees. - The Copyright Section of the National Library shall be classified as a
Division upon the effectivity of this Act. The National Library shall have the power to collect, for the
discharge of its services under this Act, such fees as may be promulgated by it from time to time subject to
the approval of the Department Head.

Q. What is SB 1704 by Ople?


A. It is on proposed amendments on the copyright portion of the IP Code. Since the Senate has already
ratified the WiPO, SB 1704 may be passed. Some relevant provisions of the SB 1704 are:
1. Anti-circumvention measures to beimplemented
- Sony and the chip
- would penalize the sale, manufacture and use of the anti-circumvention devices
2. Broader reproduction rights
- broader reproduction rights, temporary and permanent reproduction; internet; right to
make work available
3. Terms of Protection extended (from 50 years to 75 years)
4. Enforcement – making the IP Code easier to enforce with stiffer penalties

Q. What are some issues on fair use in the internet?


A. Internet gives (or requires) a new way of looking at copyright. It makes it more difficult to enforce the
right to control access, disclosure and to prevent alteration (it is easier to make alterations over the internet).
Also, there may be several copyright owners in the internet setting. Content maybe owned by the author, the
website control the access, etc.

Q. What is the significance of the E-Commerce Act on copyright infringement?


A. The ISP is made liable under the ECA during instances where it allows for the hosting of websites which
carries or is the source of infringing materials. So you can go after the website owner and the ISP and the
source of their liability would be the violation of the ECA.

Q. When is it possible to use digital works (found over the internet) without infringement?
A. 1. Implied license – when the website where the material is found contains no restrictions on copying
2. Fair use
3. Information posted is part of public domain or is not copyrightable

Q. What is contributory infringement?


A. It is when you allow others to make copies. There is no specific provision for contributory infringement in
the IP Code. But you can still bring a case for this under a criminal action, making the person who allowed the
making of copies an accessory or accomplice. It may not be possible to file a civil case. Note however that SB
1740 provides for contributory infringement.

MAI SYSTEMS CORP. v. PEAK COMPUTER, INC., 991 F.2d 511 (9th Cir. 1993)
Allan Verman Ong Intellectual Property Law: Cram Another Day 42
SY 2002-2003
MAI Systems Corp., until recently, manufactured computers and designed software to run those computers. The company
continues to service its computers and the software necessary to operate the computers. MAI software includes operating
system software, which is necessary to run any other program on the computer. Peak Computer, Inc. is a company organized
in 1990 that maintains computer systems for its clients. Peak maintains MAI computers for more than one hundred clients in
Southern California. This accounts for between fifty and seventy percent of Peak's business. Peak's service of MAI
computers includes routine maintenance and emergency repairs. Malfunctions often are related to the failure of circuit
boards inside the computers, and it may be necessary for a Peak technician to operate the computer and its operating
system software in order to service the machine.

In August, 1991, Eric Francis left his job as customer service manager at MAI and joined Peak. Three other MAI employees
joined Peak a short time later. Some businesses that had been using MAI to service their computers switched to Peak after
learning of Francis's move. On March 17, 1992, MAI filed suit in the district court against Peak, Peak's president Vincent
Chiechi, and Francis. The complaint includes counts alleging copyright infringement, misappropriation of trade secrets,
trademark infringement, false advertising, and unfair competition. The district court granted summary judgment in favor of
MAI on its claims of copyright infringement and issued a permanent injunction against Peak on these claims. The alleged
copyright violations include: (1) Peak's running of MAI software licensed to Peak customers; (2) Peak's use of unlicensed
software at its headquarters; and, (3) Peak's loaning of MAI computers and software to its customers. Each of these alleged
violations must be considered separately.

Held: To prevail on a claim of copyright infringement, a plaintiff must prove ownership of a copyright and a
"`copying' of protectable expression" beyond the scope of a license. MAI software licenses allow MAI
customers to use the software for their own internal information processing.[n3] This allowed use necessarily
includes the loading of the software into the computer's random access memory ("RAM") by a MAI customer.
However, MAI software licenses do not allow for the use or copying of MAI software by third parties such as Peak.
Therefore, any "copying" done by Peak is "beyond the scope" of the license.

It is not disputed that MAI owns the copyright to the software at issue here, however, Peak vigorously disputes the district
court's conclusion that a "copying" occurred under the Copyright Act. The Copyright Act then explains, “A work is "fixed" in
a tangible medium of expression when its embodiment in a copy or phonorecord, by or under the authority of the author, is
sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more
than transitory duration.”

The district court's grant of summary judgment on MAI's claims of copyright infringement reflects its conclusion that a
"copying" for purposes of copyright law occurs when a computer program is transferred from a permanent storage device to
a computer's RAM. This conclusion is consistent with its finding, in granting the preliminary injunction, that: "the loading of
copyrighted computer software from a storage medium (hard disk, floppy disk, or read only memory) into the memory of a
central processing unit ("CPU") causes a copy to be made. In the absence of ownership of the copyright or express
permission by license, such acts constitute copyright infringement." We find that this conclusion is supported by the record
and by the law.
Peak concedes that in maintaining its customer's computers, it uses MAI operating software "to the extent that the repair
and maintenance process necessarily involves turning on the computer to make sure it is functional and thereby running the
operating system." It is also uncontroverted that when the computer is turned on the operating system is loaded into the
computer's RAM. As part of diagnosing a computer problem at the customer site, the Peak technician runs the computer's
operating system software, allowing the technician to view the systems error log, which is part of the operating system,
thereby enabling the technician to diagnose the problem. Peak argues that this loading of copyrighted software does not
constitute a copyright violation because the "copy" created in RAM is not "fixed." However, by showing that Peak loads the
software into the RAM and is then able to view the system error log and diagnose the problem with the
computer. MAI has adequately shown that the representation created in the RAM is "sufficiently permanent
or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than
transitory duration.

The law also supports the conclusion that Peak's loading of copyrighted software into RAM creates a "copy" of
that software in violation of the Copyright Act.

Q. What is the Berne Convention?


A. The Berne Convention for the protection of literary and artistic works is the Paris Act of July 24, 1971.
Allan Verman Ong Intellectual Property Law: Cram Another Day 43
SY 2002-2003

Q. What are the pertinent provisions on 1) national treatment, 2) principle of automatic protection and 3)
principle of independence of protection?
A.
1. National Treatment

(1) Authors shall enjoy, in respect of works for which they are protected under this convention, in
countries of the Union other than the country of origin, the rights which their respective laws do
now or may hereafter grant to their nationals, as well as the rights specially granted by this
Convention.

2. Principle of automatic protection

(2) The enjoyment and the exercise of these rights shall not be subject to any formality; such
enjoyment and such exercise shall be independent of the existence of protection in the country of
origin of the work. Consequently, apart from the provisions of this convention, the extent of
protection, as well as the means of redress afforded to the author to protect his rights, shall be
governed exclusively by the laws of the country where protection is claimed.

3. Principle of Independence of Protection.

(3) Protection in the country of origin is governed by domestic law. However, when the author is not a
national of the country of origin of the work for which is protected under this Convention, he shall
enjoy in that country the same rights as national authors.

Q. What is the TRIPS Agreement?


A. The TRIPS is the agreement on the trade related aspects of rights, including trade in counterfeit goods.

Q. What are the pertinent provisions of the TRIPS concerning 1) National Treatment, and 2) Most Favored
Nation Principle?

A. They are:

1. National Treatment:

1. Each Member shall accord to the nationals of other Members treatment no less favourable than that
it accords to its own nationals with regard to the protection (3) of intellectual property, subject to
the exceptions already provided in, respectively, the Paris Convention (1967), the Berne Convention
(1971), the Rome Convention or the Treaty on Intellectual Property in Respect of Integrated
Circuits. In respect of performers, producers of phonograms and broadcasting organizations, this
obligation only applies in respect of the rights provided under this Agreement. Any Member availing
itself of the possibilities provided in Article 6 of the Berne Convention (1971) or paragraph 1(b) of
Article 16 of the Rome Convention shall make a notification as foreseen in those provisions to the
Council for TRIPS.
2. Members may avail themselves of the exceptions permitted under paragraph 1 in relation to judicial
and administrative procedures, including the designation of an address for service or the
appointment of an agent within the jurisdiction of a Member, only where such exceptions are
necessary to secure compliance with laws and regulations which are not inconsistent with the
provisions of this Agreement and where such practices are not applied in a manner which would
constitute a disguised restriction on trade.

2. Most Favored Nation Treatment


Allan Verman Ong Intellectual Property Law: Cram Another Day 44
SY 2002-2003

With regard to the protection of intellectual property, any advantage, favour, privilege or immunity
granted by a Member to the nationals of any other country shall be accorded immediately and
unconditionally to the nationals of all other Members. Exempted from this obligation are any
advantage, favour, privilege or immunity accorded by a Member:
(a) deriving from international agreements on judicial assistance or law enforcement of a general
nature and not particularly confined to the protection of intellectual property;
(b) granted in accordance with the provisions of the Berne Convention (1971) or the Rome Convention
authorizing that the treatment accorded be a function not of national treatment but of the
treatment accorded in another country;
(c) in respect of the rights of performers, producers of phonograms and broadcasting organizations
not provided under this Agreement;
(d) deriving from international agreements related to the protection of intellectual property which
entered into force prior to the entry into force of the WTO Agreement, provided that such
agreements are notified to the Council for TRIPS and do not constitute an arbitrary or unjustifiable
discrimination against nationals of other Members.

You might also like