Abscbn v. Gozon Smith Kline v CA Digests

ABS-CBN V. GOZON G.R. No. 195956, March 11, 2015

undeniably attended by good faith and thus, serves to exculpate from criminal liability under the Intellectual Property Code.

CASE DIGEST Facts: On August 13, 2004, petitioner ABS-CBN filed a criminal complaint against respondent GMA for (alleged) act of copyright infringement under Sections 177 and 211 of the Intellectual Property Code (RA 8293, as amended), because the respondent aired footage of the arrival and homecoming of OFW Angelo dela Cruz at NAIA from Iraq without the petitioner's consent. ABS-CBN stated that it has an agreement with Reuter's that the petition will contribute news and content that it owns and makes to Reuters in exchange of the latter's news and video material, and Reuters will ensure that ABS-CBN's materials cannot be aired in the country. The respondent was a subscriber of Reuter's and CNN live feeds. After it received the live feed of Angelo Dela Cruz's arrival and homecoming from Reuter's, it immediately aired the video from that news feed. The respondent alleged that its news staff was not aware that there was (a news embargo) agreement between ABSCBN and Reuters. Respondent alleged that it was not also aware that it aired petitioner's footage. Assistant City Prosecutor Dindo Venturanza issued resolution on 3 December 2004 which found probable cause to indict Dela Peña-Reyes and Manalastas. The respondents appealed the Prosccutor's resolution before DOJ. DOJ Secretary Raul M. Gonzalez ruled in favor of respondents in his resolution dated 1 August 2005 and held that good faith may be raised as a defense in the case. Meanwhile, DOJ Acting Secretary Alberto C. Agra issued a resolution on 29 June 2010 which reversed Sec. Gonzalez's resolution and found probable cause to charge Dela Peña-Reyes, Manalastas, as well as to indict Gozon, Duavit, Jr., Flores, and Soho for violation of the Intellectual Property Code (due to copyright infringement). The Court of Appeals rendered a decision on 9 November 2010, which granted the Petition for Certiorari to reverse and set aside DOJ Sec. Alberto Agra's resolution and a prayer for issuance of a temporary restraining order and/or Writ of Preliminary Injunction. The appellate court stated that the petitioner has copyright of its news coverage, but respondents’ act of airing five (5) seconds of the homecoming footage without notice of the “No Access Philippines” restriction of the live Reuter's video feed, was

ISSUES W/N there is probable cause to find respondents to be held liable criminally for the case of copyright infringement under the Intellectual Property Law (RA 8293, as amended)?

HELD The Supreme Court PARTIALLY GRANTED ABS-CBN’s ABS- CBN’s petition and ordered RTC Q.C. Branch 93 to continue with the criminal proceedings against Grace Dela PeñaReyes and John Oliver Manalastas due to copyright infringement. The other respondents, Atty. Felipe Gozon, Gilberto Duavit Jr., Marissa L. Flores, and Jessica A. Soho were held not liable for the (criminal) act of copyright infringement. The Court held that their mere membership in GMA7's Board of Directors does not mean that they have knowledge, approval, or participation in the criminal act of copyright infringement as there is a need for their direct/active participation in such act. Also, there was lack of proof that they actively participated or exercised moral ascendancy over Manalastas and Dela Cruz-Pena. Contrary to GMA’s contention, the Supreme Court deemed GMA's mere act of rebroadcast of ABSCBN’s news footage (arrival and homecoming of OFW Angelo dela Cruz at NAIA from Iraq last 22 July 2004) for 2 mins and 40 secs.without the latter's authority creates probable cause to find GMA's news personnel Manalastas and Dela Peña-Reyes criminally liable for violating provisions of Intellectual Property Code (Section 216¬217 of RA 8293, as amended) that imposes strict liability for copyright infringement, since they have not been diligent in their functions to prevent that footage from being aired on television. They knew that there would be consequences in carrying ABS-CBN’s ABS- CBN’s footage in their broadcast –  broadcast –  which  which is why they allegedly cut the feed from Reuters upon seeing ABS-CBN’s ABS-CBN’s logo and reporter. The difference of an act mala in se and mala prohibita was stated in the present case. Acts mala in se requires presence of criminal intent and the person's knowledge of the nature of his/her act, w hile in acts mala prohibita, presence of criminal intent and the person's knowledge is not necessary. The Court also stated that Philippine laws on copyright infringement does not require criminal intent (mens rea) and does not support good faith as a defense. Thus, the act of infringement and not the intent is the one that causes the damage. It held that ABS-CBN's video footage is copyrightable because it is under “audiovisual works and cinematographic works and works produced by a process analogous to

cinematography or any process for making audiovisual recordings.” It also stated that news or the event itself is not copyrightable. The Court differentiated idea and expression – idea meant as “a form, the look or appearance of a thing” while expression is its reality or the “external, perceptible world of articulate sounds and visible written symbols that others can understand.” Thus, the Supreme Court stated that “only the expression of an idea is protected by copyright, not the idea itself”, citing the US Supreme Court's decision in Baker vs Selden (101 U.S. 99). In the present case, expression applies to the event captured and presented in a specific medium via cinematography or processes analogous to it. The Court also gave the four-fold test under the Fair Use Doctrine (stated in section 185 of RA 8293 or the Intellectual Property Code, as amended) to determine fair use: a. The purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes; b. The nature of the copyrighted work; c. The amount and substantiality of the portion used in relation to the copyrighted work as a whole; and d. The effect of the use upon the potential market for or value of the copyrighted work. Fair use, which is an exception to copyright owner’s monopoly of the work's usage, was defined by the Supreme Court as privilege to use the copyrighted material in a reasonable manner without the copyright owner's consent or by copying the material's theme or idea rather than its expression. It also said that determination of whether the Angelo dela Cruz footage is subject to fair use is better left to the trial court where the proceedings are currently pending. Smith Kline & French Laboratories, Ltd. vs Court of Appeals (2001) In August 1989, Danlex Research Laboratories petitioned before Bureau of Patents, Trademarks and Technology Transfer (BPTTT) that it may be granted a compulsory license for the use and manufacture of the pharmaceutical product Cimetidine. Cimetidine is useful as an antihistamine and in the treatment of ulcers. Cimetidine is originally patented to Smith Kline and French Laboratories, Ltd. in 1978, and the said patent is still in force at the time of application by Danlex Research. The BPTTT granted the application of Danlex Research together with a provision that Danlex Research should be paying 2.5% of the net wholesale price as royalty payment to Smith Kline. This was affirmed by the Court of Appeals. Smith Kline assailed the grant as it argued, among others, that the same is an invalid exercise of police power because there is no overwhelming public

necessity for such grant considering that Smith Kline is able to provide an adequate supply of it to satisfy the needs of the Philippine market; that a provision in the Philippine Patent Laws is violative of the Paris Convention to which the Philippines is a signatory. To explain the second contention, Smith Kline states that the Paris Convention only allows compulsory licensing if the original licensee (patent holder) has failed to work on the patent; that therefore, the provision in the Philippine Patent Laws which adds other grounds for the granting of compulsory license i.e. monopoly, is invalid and contrary to the Paris Convention. ISSUE: Whether or not Smith Kline is correct. HELD: No. The granting is a valid exercise of police power. Cimetidine is medicinal in nature, and therefore necessary for the promotion of public health and safety. On the second contention, Section A(2) of Article 5 [of the Paris Convention] unequivocally and explicitly respects the right of member countries to adopt legislative measures to provide for the grant of compulsory licenses to prevent abuses which might result from the exercise of the exclusive rights conferred by the patent. An example provided of possible abuses is “failure to work;” however, as such, is merely supplied by way of an example, it is plain that the treaty does not preclude the inclusion of other forms of categories of abuses. The legislative intent in the grant of a compulsory license was not only to afford others an opportunity to provide the public with the quantity of the patented product, but also to prevent the growth of monopolies. Certainly, the growth of monopolies was among the abuses which Section A, Article 5 of the Convention foresaw, and which our Congress likewise wished to prevent in enacting.