Nomar Jethro Y.

Mata
IPL

Bayanihan Music vs. BMG [G.R. No. 166337. March 7, 2005]

SECTION 172. Literary and Artistic Works.
SEC. 172.2. Works are protected by the sole fact of their creation, irrespective of their
mode or form of expression, as well as of their content, quality and purpose.
Facts:
Private respondent Jose Mari Chan entered into a contract with petitioner Bayanihan,
whereunder Chan assigned all his rights, interests, and participation to the latter over his two
musical compositions. Bayanihan then applied for and was granted a Certificate of Copyright
Registration over said compositions. Unknown to petitioner, Chan authorized the respondent BMG
Records to record and distribute said compositions. The petitioner filed with the RTC of Quezon
City a complaint against the respondents with a prayer for the issuance of TRO and/or writ of
preliminary injunction. Chan, in his defense, stated that the contract was rescinded when the
petitioner failed to advertise his compositions for over twenty years contrary to the agreement.
The RTC denied to grant the prayer of the petitioner, the Court of Appeals likewise arrived
with the same decision. The lower courts stated that the petitioner is not entitled to the relief of
TRO as well as the preliminary injunction.
Issues:
W/N the petitioner is entitled of said reliefs.
Held:
No. The issuance of an injunctive writ if the following requisites provided for by law are
not present: (1) there must be a right in esse or the existence of a right to be protected; and (2) the
act against which the injunction is to be directed is a violation of such right, the trial court threaded
the correct path in denying petitioner's prayer therefor. For, such a writ should only be granted if
a party is clearly entitled thereto. Petitioner Bayanihan, to be entitled to the writ, he is required to
show that he has the ostensible right to the final relief prayed for in its complaint. Unquestionably,
respondent Chan, being undeniably the composer and author of the lyrics of the two (2) songs, is
protected by the mere fact alone that he is the creator thereof, conformably with Republic Act No.
8293, otherwise known as the Intellectual Property Code, Section 172.2. Furthermore, appear that
the two (2) contracts expired, due to the failure of the petitioner to comply with the stipulations,
almost two years before petitioner Bayanihan wrote its complaint. By then, it would appear that
petitioner had no more right that is protectable by injunction. Thus, the petition is denied.

Unilever Philippines (PRC) Inc. vs. The Honorable Court of Appeals and P&G Philippines
Inc. [G.R. No. 119280]
SECTION 172. Literary and Artistic Works.
SEC. 172.2. Works are protected by the sole fact of their creation, irrespective of their
mode or form of expression, as well as of their content, quality and purpose.
Facts:
P&G subsidiary in Italy used a key visual in the advertisement of its laundry detergent and
bleaching products. This key visual known as the double-tug or tac-tac demonstration shows the
fabric being held by both hands and stretched sideways. P&G has used the same distinctive tactac key visual to local consumers in the Philippines. Substantially and materially imitating the
aforesaid tac-tac key visual of P&GP and in blatant disregard of P&GPs intellectual property
rights, Unilever started airing a television commercial almost identical or substantially similar to
P&GPs tac-tac key visual. The private respondent was granted a writ of preliminary injunction
against the petitioner from using or airing commercials claimed to be similar to the tac-tac key
visual. Petitioner appealed to the Court of Appeals contending that the preliminary injunction
issued against it already disposed of the main case without trial, thus denying petitioner of any
opportunity to present evidence on its behalf. The CA upheld the decision of the lower court.
Issues:
W/N the injunction was issued in grave abuse of discretion.
Held:
No. Petitioner does not deny that the questioned TV advertisements are substantially
similar to P&GPs double tug or tac-tac key visual. However, it submits that P&GP is not entitled
to the relief demanded, which is to enjoin petitioner from airing said TV advertisements, for the
reason that petitioner has Certificates of Copyright Registration for which advertisements while
P&GP has none with respect to its double-tug or tac-tac key visual. In other words, it is petitioners
contention that P&GP is not entitled to any protection because it has not registered with the
National Library the very TV commercials which it claims have been infringed by petitioner. The
Court disagrees stating that under the law, the copyright for a work or intellectual creation subsists
from the moment of its creation and the protection given by law to him is not contingent or
dependent on any formality or registration.
The sole objective of a writ of preliminary injunction is to preserve the status quo until the
merits of the case can be heard fully. A writ of preliminary injunction is generally based solely on
initial and incomplete evidence. Thus, it was impossible for the court a quo to fully dispose of the
case, as claimed by petitioner, without all the evidence needed for the full resolution of the same.
here was no such abuse in the case at bar, especially because petitioner was given all the
opportunity to oppose the application for injunction. The fact was, it failed to convince the court
why the injunction should not be issued.

ABS-CBN Corp. vs. Felipe Gozon [G.R. No. 195956]

SECTION 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
SECTION 175. Unprotected Subject Matter. Notwithstanding the provisions of Sections 172
and 173, no protection shall extend, under this law, to any idea, procedure, system, method or
operation, concept, principle, discovery or mere data as such, even if they are expressed, explained,
illustrated or embodied in a work; news of the day and other miscellaneous facts having the
character of mere items of press information; or any official text of a legislative, administrative or
legal nature, as well as any official translation thereof. (n)
Facts:
ABS-CBN conducted live audio-video coverage of and broadcasted the arrival of Angelo
dela Cruz at the Ninoy Aquino International Airport (NAIA) and the subsequent press conference.
The respondent GMA-7 carried the live news feed in its program "Flash Report," together with its
live broadcast. ABS-CBN filed the Complaint for copyright infringement under Sections 177 and
211 of the Intellectual Property Code. The respondents appealed the Prosecutors resolution before
DOJ. DOJ Secretary Raul M. Gonzalez ruled in favor of respondents. DOJ Acting Secretary
Alberto C. Agra issued a resolution which reversed Sec. Gonzalez's resolution. The Court of
Appeals rendered a decision which reversed and set aside Agra's resolution. One of the contentions
upheld by the lower court is that the subject matter of the case is not copyrightable being news of
the day under Sec. 175 of RA 8293.
Issue:
W/N the coverage is copyrightable
Held:
Yes. To be clear, it is the event itself or the arrival of Angelo dela Cruz which is not
copyrightable because that is the newsworthy event. However, any footage created from the event
itself, in this case the arrival of Angelo dela Cruz, are intellectual creations which are
copyrightable. Thus, the footage created by ABS-CBN during the arrival of Angelo dela Cruz,
which includes the statements of Dindo Amparo, are copyrightable and protected by the laws on
copyright. The Intellectual Property Code is clear about the rights afforded to authors of various
kinds of work. Under the Code, "works are protected by the sole fact of their creation, irrespective
of their mode or form of expression, as well as of their content, quality and purpose." These include
"audiovisual works and cinematographic works and works produced by a process analogous to
cinematography or any process for making audiovisual recordings. Thus, the news footage is
copyrightable.

Joaquin v. Drilon [GR. No. 108946]

SECTION 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;
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.
SECTION 175. Unprotected Subject Matter. Notwithstanding the provisions of Sections 172
and 173, no protection shall extend, under this law, to any idea, procedure, system, method or
operation, concept, principle, discovery or mere data as such, even if they are expressed, explained,
illustrated or embodied in a work; news of the day and other miscellaneous facts having the
character of mere items of press information; or any official text of a legislative, administrative or
legal nature, as well as any official translation thereof. (n)
Facts:
Petitioner BJ Productions, Inc. (BJPI) is the holder/grantee of Certificate of Copyright No.
M922, dated January 28, 1971, of Rhoda and Me, a dating game show. RPN Channel 9 aired an
episode of Its a Date, which was produced by IXL Productions, Inc. (IXL). Petitioner informed
private respondent that BJPI had a copyright to Rhoda and Me and demanding that IXL
discontinue airing Its a Date. IXL continued airing the said show prompting the petitioner to
file with the RTC a complaint against the respondent for violating his copyrights over the show.
Respondent Secretary of Justice Franklin M. Drilon reversed the Assistant City Prosecutors
findings and directed him to move for the dismissal of the case against private respondents.
Petitioners contend that he public respondent gravely abused his discretion amounting to lack of

jurisdiction when he arrogated unto himself the determination of what is copyrightable - an issue
which is exclusively within the jurisdiction of the regional trial court to assess in a proper
proceeding.
Issue:
W/N the show Rhoda and Me is copyrightable
Held:
No. It is indeed true that the question whether the format or mechanics of petitioners
television show is entitled to copyright protection is a legal question for the court to make. This
does not, however, preclude respondent Secretary of Justice from making a preliminary
determination of this question in resolving whether there is probable cause for filing the case in
court. In doing so in this case, he did not commit any grave error.
Petitioners assert that the format of Rhoda and Me is a product of ingenuity and skill and
is thus entitled to copyright protection. It is their position that the presentation of a point-by-point
comparison of the formats of the two shows clearly demonstrates the nexus between the shows
and hence establishes the existence of probable cause for copyright infringement. he format of a
show is not copyrightable. Section 172 of RA 8293 enumerates the classes of work entitled to
copyright protection. The format or mechanics of a television show is not included in the list of
protected works, for this reason, the protection afforded by the law cannot be extended to cover
them. The enumeration refers to finished works and not concepts. The copyright does not extend
to an idea, procedure, process, system, method of operation, concept, principle, or discovery,
regardless of the form in which it is described, explained, illustrated, or embodied in such work as
provided in Sec. 175.

ABS-CBN Broadcasting Corporation vs. Philippine Multi-Media System, Inc. [GR. No.
175769-70]
SECTION 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
SECTION 184. Limitations on Copyright. 184.1. Notwithstanding the provisions of Chapter V, the following acts shall not constitute
infringement of copyright:
(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
Facts:
Petitioner ABS-CBN is licensed under the laws of the Republic of the Philippines to engage
in television and radio broadcasting. The programs aired over Channels 2 and 23 are either
produced by ABS-CBN or purchased from or licensed by other producers. Respondent Philippine
Multi-Media System, Inc. (PMSI) is the operator of Dream Broadcasting System. It delivers digital
direct-to-home (DTH) television via satellite to its subscribers all over the Philippines. PMSI was
granted a legislative franchise under Republic Act No. 8630 and was given a Provisional Authority
by the National Telecommunications Commission (NTC) install, operate and maintain a
nationwide DTH satellite service. When it commenced operations, it offered as part of its program
line-up ABS-CBN Channels 2 and 23.
ABS-CBN demanded for PMSI to cease and desist from rebroadcasting Channels 2 and
23MSI replied that the rebroadcasting was in accordance with the authority granted it by NTC and
its obligation under NTC. ABS-CBN filed with the IPO a complaint with Prayer for the Issuance
of a Temporary Restraining Order and/or Writ of Preliminary Injunction, alleging that PMSIs
unauthorized rebroadcasting of Channels 2 and 23 infringed on its broadcasting rights and
copyright. The decision of the IPO Director-General and of the Court of Appeals rendered in favor
of the respondent. Hence, the instant petition.
Issue:
W/N the broadcasting of channels 2 and 23 by the respondent is a violation of IPL.
Held:
No. Director-General of the IPO correctly found that PMSI is not engaged in
rebroadcasting and thus cannot be considered to have infringed ABS-CBNs broadcasting rights
and copyright. Rebroadcasting is the simultaneous broadcasting by one broadcasting organization
of the broadcast of another broadcasting organization. The carriage of ABS-CBNs signals is under
the direction and control of the government though the NTC which is vested with exclusive
jurisdiction to supervise, regulate and control telecommunications and broadcast services/facilities
in the Philippines. The IP Code provides that The use made of a work by or under the direction or
control of the Government is a limitation of the protection of copyright under Sec. 184 of RA 8293.
Neither is PMSI guilty of infringement of ABS-CBNs copyright under Section 177 of the
IP Code. Rebroadcasting as defined in Article 3(g) of the International Convention for the

Protection of Performers, Producers of Phonograms and Broadcasting Organizations, otherwise

known as the 1961 Rome Convention, of which the Republic of the Philippines is a signatory, is
the simultaneous broadcasting by one broadcasting organization of the broadcast of another
broadcasting organization. The Director-General of the IPO correctly found that PMSI is not
engaged in rebroadcasting and thus cannot be considered to have infringed ABS-CBNs
broadcasting rights and copyright.
PMSI merely carries such signals which the viewers receive in its unaltered form. PMSI
does not produce, select, or determine the programs to be shown in Channels 2 and 23. Likewise,
it does not pass itself off as the origin or author of such programs. Insofar as Channels 2 and 23
are concerned, PMSI merely retransmits the same in accordance with the Memorandum Circular.
Clearly, PMSI does not perform the functions of a broadcasting organization; thus, it cannot be
said that it is engaged in rebroadcasting Channels 2 and 23.

Columbia Pictures v. Court of Appeals [G.R. No. 110318]

SECTION 216. Infringement. A person infringes a right protected under this Act when one:
(a) Directly commits an infringement;
(b) Benefits from the infringing activity of another person who commits an infringement if
the person benefiting has been given notice of the infringing activity and has the right and
ability to control the activities of the other person;
(c) With knowledge of infringing activity, induces, causes or materially contributes to the
infringing conduct of another
SECTION 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, in accordance
with the rules on search and seizure involving violations of intellectual property rights issued by
the Supreme Court
Facts:
Petitioners thru counsel lodged a formal complaint with the National Bureau of
Investigation for violation of film piracy. NBI Senior Agent Lauro C. Reyes applied for a search
warrant with the court a quo against Sunshine seeking the seizure, among others, of pirated video
tapes of copyrighted films all of which were enumerated in a list attached to the application. The
search warrant was served and the NBI Agents found and seized various video tapes of duly
copyrighted motion pictures/films owned or exclusively distributed by private complainants. The
RTC upon reconsideration quashed the search warrant on the ground that it is in the nature of a
general warrant.
Issue:
W/N the quashal of the warrant was proper
Held:
No. The trial courts finding that private respondents committed acts in blatant transgression
of the Intellectual Property Law. 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 what works he was indirectly copying, or did
not know whether or not he was infringing any copyright; he at least knew that what he was
copying was not his, and he copied at his peril. In 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.
On private respondents averment to issue one search warrant for all the movie titles
allegedly pirated violates the rule that a search warrant must be issued only in connection with one
specific offense, is not to be confused with the number of offenses charged. The search warrant
herein issued does not violate the one-specific-offense rule.

Habana v. Robles [G.R. No. 131522]

SECTION 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
SECTION 216. Infringement. A person infringes a right protected under this Act when one:
(a) Directly commits an infringement
Facts:
Petitioners are authors and copyright owners of duly issued certificates of copyright
registration covering their published works entitled COLLEGE ENGLISH FOR TODAY (CET
for brevity). Respondent Felicidad Robles is the author of another published work entitled
DEVELOPING ENGLISH PROFICIENCY (DEP for brevity). After an itemized examination and
comparison of the two books (CET and DEP), petitioners found that several pages of the
respondents book are similar, if not all together a copy of petitioners book, which is a case of
plagiarism and copyright infringement. Petitioners then filed with the Regional Trial Court,
Makati, a complaint for Infringement and/or unfair competition with damages against private
respondents. Respondent Robles denied the allegations and stressed that (1) the book DEP is the
product of her independent researches, studies and experiences, and was not a copy of any existing
valid copyrighted book; (2) DEP followed the scope and sequence or syllabus which are common
to all English grammar writers.
The lower court and the Court of Appeals dismissed the case noting that similarity of the
allegedly infringed work to the authors or proprietors copyrighted work does not of itself establish
copyright infringement, especially if the similarity results from the fact that both works deal with
the same subject or have the same common source
Issue:
W/N the similarity between the two books is an infringement of copyrights
Held:
Yes. Records yields several pages of the book DEP that are similar if not identical with the
text of CET. The Court believed that respondent Robles act of lifting from the book of petitioners
substantial portions of discussions and examples, and her failure to acknowledge the same in her
book is an infringement of petitioners copyrights. Substantial reproduction of work 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. 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 latters 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.

Ching v. Salinas [G.R. No. 161295]

SECTION 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
SECTION 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, in
accordance with the rules on search and seizure involving violations of intellectual property rights
issued by the Supreme Court.
RULE 126 SEC. 4. Requisite for issuing search warrant - A search warrant shall not issue but
upon probable cause in connection with one specific offense to be determined personally by the
judge after examination under oath or affirmation of the complainant and the witnesses he may
produce, and, particularly, describing the place to be searched and the things to be seized. (Rules
of Court)
Facts:
Jessie G. Ching is the maker and manufacturer of a Utility Model, described as Leaf Spring
Eye Bushing for Automobile made up of plastic of which she obtained Certificates of Copyright
Registration. Ching requested the National Bureau of Investigation (NBI) for police/investigative
assistance for the apprehension and prosecution of illegal manufacturers, producers and/or
distributors of the works. The NBI filed applications for search warrants in the RTC of Manila
against the respondents. It was alleged that the respondents reproduced and distributed the said
models. The respondents filed a motion to quash the search warrants on the ground that the subject
matter of the registrations are not artistic or literary. The petitioner averred that the court which
issued the search warrants was not the proper forum in which to articulate the issue of the validity
of the copyrights issued to him. The trial court granted the motion and the Court of Appeals upheld
the said decision.
Issue:
W/N the motion to quash was properly granted
Held:
Yes. Under Sec. 216.2 of RA 8293, a court may issue search warrants in accordance with
the Rules of Court. Corollary, the rules states that the issuance of a warrant must be grounded upon
a probable cause. In the determination of probable cause, the court must necessarily resolve
whether or not an offense exists to justify the issuance or quashal of the search warrant. Thus, the
court can determine whether or not the subject matter is entitled to protection.
The utility model of the petitioner is not intellectual creations in the literary and artistic
domain, or works of applied art. It is certainly not ornamental designs or one having decorative
quality or value. No copyright granted by law can be said to arise in favor of the petitioner despite
the issuance of the certificates of copyright registration and the deposit of the Leaf Spring Eye
Bushing and Vehicle Bearing Cushion. The petitioners model may be the proper subject of a
patent does not entitle him to the issuance of a search warrant for violation of copyright laws.

Pearl & Dean v. Shoemart [G.R. No. 148222]

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
SEC. 2 PD 49. The rights granted by this Decree shall, from the moment of creation, subsist
with respect to any of the following works:
(O) Prints, pictorial illustrations, advertising copies, labels, tags, and box wraps;
Facts:
Pearl and Dean Inc. is a corporation engaged in the manufacture of advertising display
units simply referred to as light boxes. These units utilize specially printed posters sandwiched
between plastic sheets and illuminated with back lights. Pearl and Dean was able to secure a
Certificate of Copyright Registration dated January 20, 1981 over these illuminated display units.
P&D, received reports that exact copies of its light boxes were installed at SM City and in the
fastfood section of SM Cubao.It further discovered that defendant-appellant North Edsa Marketing
Inc. (NEMI) as sister company of SMI was set up primarily to sell advertising space in lighted
display units located in SMIs different branches. P&D filed for infringement of copyright. The
RTC of Makati City decided in favor of P & D. On appeal, however, the Court of Appeals reversed
the trial court on the ground that the light boxes are not copyrightable.
Issue:
W/N the said light boxes are copyrightable
Held:
No. Its claim of copyright infringement cannot be sustained. P & D secured its copyright
under the classification class O work. This being so, petitioners copyright protection extended only
to the technical drawings and not to the light box itself because the latter was not at all in the
category of prints, pictorial illustrations, advertising copies, labels, tags and box wraps. Even as
we find that P & D indeed owned a valid copyright, the same could have referred only to the
technical drawings within the category of pictorial illustrations. Moreover, the president of P &
D himself admitted that the light box was neither a literary not an artistic work but an engineering
or marketing invention. Trademark, copyright and patents are different intellectual property rights
that cannot be interchanged with one another. A trademark is any visible sign capable of
distinguishing the goods (trademark) or services (service mark) of an enterprise and shall include
a stamped or marked container of goods. In relation thereto, a trade name means the name or
designation identifying or distinguishing an enterprise. Meanwhile, the scope of a copyright is
confined to literary and artistic works which are original intellectual creations in the literary and
artistic domain protected from the moment of their creation. Patentable inventions, on the other
hand, refer to any technical solution of a problem in any field of human activity which is new,
involves an inventive step and is industrially applicable.

NBI-Microsoft Corporation & Lotus Development v. Judy C. Hwang [G.R. No. 147043]
SECTION 177. Copyright or Economic Rights. Subject to the provisions of Chapter VIII,
copyright or economic rights shall consist of the exclusive right to carry out, authorize or prevent
the following acts:
177.3. The first public distribution of the original and each copy of the work by sale or
other forms of transfer of ownership (Sec 5 PD 49)
SECTION 216. Infringement. A person infringes a right protected under this Act when one:
(a) Directly commits an infringement;
(b) Benefits from the infringing activity of another person who commits an infringement if
the person benefiting has been given notice of the infringing activity and has the right and
ability to control the activities of the other person;
(c) With knowledge of infringing activity, induces, causes or materially contributes to the
infringing conduct of another.
Facts:
Petitioner Microsoft owns the copyright and trademark to several computer software. It
entered into a licensing agreement with the respondent Beltron to authorize the latter, with a fee,
to reproduce, install, and directly or indirectly distribute the copyrighted program. The Agreement
also authorized Microsoft and Beltron to terminate the contract if the other fails to comply with
any of the Agreements provisions. Microsoft terminated the Agreement for Beltrons non-payment
of royalties. The respondents continued to illegally copy and sell Microsoft software. Microsoft
applied for search warrants against respondents in RTC. The RTC granted Microsofts application
and issued two search warrants. The NBI searched the premises of the respondents and seized
several computer-related hardware, software, accessories, and paraphernalia. Among these were
2,831 pieces of CD-ROMs containing Microsoft software.
DOJ State Prosecutor Jocelyn A. Ong (State Prosecutor Ong) recommended the dismissal
of Microsofts complaint for lack of merit and insufficiency of evidence. It reasoned that the case
was only civil in nature for nonpayment of fees, and not criminal. Moreover, the office has no
power to determine the effectivity of the contract at the time of the execution of the warrants.
Violation of P.D. 49 does not exist, for respondent/s was/were not the manufacturers of the
Microsoft software seized and were selling their products as genuine Microsoft software,
considering that they bought it from a Microsoft licensee.
Issue:
W/N the DOJ acted with grave abuse of discretion in not finding probable cause to charge
respondents with copyright infringement.
Held:
Yes. The term [probable cause] does not mean actual and positive cause nor does it import
absolute certainty. It is merely based on opinion and reasonable belief. Thus, a finding of probable
cause does not require an inquiry into whether there is sufficient evidence to procure a conviction.
It is enough that it is believed that the act or omission complained of constitutes the offense
charged. Precisely, there is a trial for the reception of evidence of the prosecution in support of the
charge. The gravamen of copyright infringement is not merely the unauthorized manufacturing of
intellectual works but rather the unauthorized performance of any of the acts covered by Section

5 of PD 49. Hence, any person who performs any of the acts under Section 5 without obtaining the
copyright owners prior consent renders himself civilly and criminally liable for copyright
infringement. The items seized from respondents suffice to support a finding of probable cause to
indict respondents for copyright infringement under Section 5(A) in relation to Section 29 of PD
49 for unauthorized copying and selling of protected intellectual works.

Metro-Goldwyn-Mayer Studios Inc. (MGM) v. Grokster, LTD [545 U.S. 913]

Rule of law: When a distributor takes affirmative steps to foster infringement through the use of
its product, the distributor will be liable for that infringement conducted by 3rd parties.
Facts:
Respondent companies distribute free software that allows computer users to share
electronic files through peer-to-peer networks, so called because the computers communicate
directly with each other, not through central servers. Recipients of respondents software have
mostly used them to share copyrighted music and video files without authorization. a group of
movie studios and other copyright holders (hereinafter MGM) sued respondents for their users
copyright infringements, alleging that respondents knowingly and intentionally distributed their
software to enable users to infringe copyrighted works in violation of the Copyright Act. MGM
was able to show that some 90 percent of the files being shared where copyrighted files. The district
court granted summary judgment in favor of Grokster and Stream Case because although users of
the software did infringe MGMs property there was no proof there the distributors had actual
knowledge of specific acts of infringement. MGM appealed
Issue:
W/N the respondent shall be liable for infringement for the use of its product by third
parties.
Held:
Yes. The court considers the doctrine of inducement to also relevant. One who distributes
a device with the object of promoting its use to infringe copyright, as shown by clear expression
or other affirmative steps taken to foster infringement, going beyond mere distribution with
knowledge of third-party action, is liable for the resulting acts of infringement by third parties
using the device, regardless of the devices lawful uses. One infringes contributorily by
intentionally inducing or encouraging direct infringement, and infringes vicariously by profiting
from direct infringement while declining to exercise the right to stop or limit it. Respondents
unlawful objective is unmistakable. There is evidence of such infringement on a gigantic scale.

Sony Corp. of America v. Universal City Studios, Inc. [464 U.S. 417]
Rule of Law: One who supplies the way to accomplish an infringing activity and encourages that
activity through advertisement is not liable for copyright infringement.
Facts:
Petitioner Sony Corp. manufactures home video tape recorders (VTR's), and markets them
through retail establishments. Respondents own the copyrights on some of the television programs
that are broadcast on the public airwaves. Respondents brought an action against petitioners
alleging that VTR consumers had been recording some of respondents' copyrighted works that had
been exhibited on commercially sponsored television and thereby infringed respondents'
copyrights, and further that petitioners were liable for such copyright infringement because of their
marketing of the VTR's. District Court denied respondents all relief, holding that it did not
constitute copyright infringement, and that petitioners could not be held liable as contributory
infringers.
Issue:
W/N the petitioner shall be liable as contributory infringers for supplying products used
for infringing activities.
Held:
No. The sale of the VTR's to the general public does not constitute contributory
infringement of respondents' copyrights. Any individual may reproduce a copyrighted work for a
"fair use"; the copyright owner does not possess the exclusive right to such a use. the only contact
between petitioners and the users of the VTR's occurred at the moment of sale. And there is no
precedent for imposing vicarious liability on the theory that petitioners sold the VTR's with
constructive knowledge that their customers might use the equipment to make unauthorized copies
of copyrighted material. The sale of copying equipment, like the sale of other articles of commerce,
does not constitute contributory infringement if the product is widely used for legitimate,
unobjectionable purposes, or, indeed, is merely capable of substantial non-infringing uses.