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United States Court of Appeals,Second Circuit.

James LIPTON, Plaintif-Counter-efendant-Appellee, !. T"e

NATU#$ CO%PAN&, d'a T"e Nature Compan( of California,
efendant-Cross-Claimant, %ic"ael )ein, efendant-Cross-
efendant-Appellant, Animal )isdom $nterprises, Inc.,
*+,+, oc-et ./-.*01.No.
Ar3ued Sept. *+, *..,. -- No!em'er 0+, *..,
Before: MINER, MAHONEY, and CABRANES, Circuit Judges. Nanc J.
!e"sten, Ne# Yor$ Cit %Marcia B. &au", 'a Co""er ( Boose, Ne# Yor$ Cit,
on t)e *rief+, for &"ainti,-Counter-.efendant-A//e""ee. 0. .ona"d &rut12an,
Ne# Yor$ Cit %Stec)er Jag"o2 ( &rut12an, Ne# Yor$ Cit, Jo)n &. Sutton,
Ha3erstoc$, Med"en ( Carro"", San !rancisco, Ca"ifornia, on t)e *rief+ for
4)is is an a//ea" fro2 a 5na" 6udg2ent of t)e 7nited States .istrict Court
for t)e Sout)ern .istrict of Ne# Yor$ %Ric)ard O#en, Judge+, granting
/"ainti,-a//e""ee Ja2es 0i/ton8s %90i/ton:+ 2otion for su22ar 6udg2ent
on )is co/rig)t and 0an)a2 Act c"ai2s against defendants Ani2a"
;isdo2 Enter/rises, Inc. %9A;E:+, its /resident and /rinci/a" stoc$)o"der,
Mic)ae" ;ein %9;ein:+, and 4)e Nature Co2/an, %9Nature:+.
;ein and
A;E a//ea".= 4)e Octo*er <> order a#arded t)e /"ainti, en)anced
statutor da2ages in t)e a2ount of ?<@@,@@@, costs and attornes8 fees,
and entered a /er2anent in6unction restraining t)e defendants fro2
furt)er infringe2ent. = 4)ese inc"uded a 5nding t)at t)e /"ainti,-
a//e""ee8s #or$ #as /rotecti*"e under co/rig)t "a#, 0i/ton 3. 4)e Nature
Co., AB< !.Su//. <@CD %S...N.Y.<EED+, an a#ard of su22ar 6udg2ent to
t)e /"ainti, on )is co/rig)t and 0an)a2 Act c"ai2s, and a 5nding t)at t)e
defendants #ere #i""fu" infringers. =4)e district court8s order and 5na"
6udg2ent #it) res/ect to ;ein and A;E, entered on Octo*er <>, <EE>,
i2/"e2ented 3arious 2e2orandu2 o/inions and orders /re3ious" issued
* t)e court. =
At issue in t)is case is a co2/i"ation of 9ter2s of 3ener:
<<DG.=>C%a+ of
t)e 0an)a2 4rade2ar$ Act, <G 7.S.C. H=G@< et seI., and unfair" co2/eted
#it) 0i/ton, in 3io"ation of H= 0i/ton8s co2/"aint a""eged t)at t)e
defendants created 3arious /osters and ot)er /roducts t)at infringed t)e
co/rig)t of t)e 5rst and second editions of )is *oo$, in 3io"ation of <A
7.S.C. H= 4)e 5rst edition of t)e *oo$ #as /u*"is)ed in <EJB, and t#o
su*seIuent editions #ere /u*"is)ed in <EAA and <EE<K 0i/ton )o"ds a
3a"id co/rig)t to a"" t)ree 3ersions of t)e *oo$. =-co""ecti3e ter2s for
identifing certain ani2a" grou/s-gat)ered and /u*"is)ed * t)e aut)or
and et2o"ogist Ja2es 0i/ton in )is *oo$, An ELa"tation of 0ar$s.
In t)e course of doing so, )e disco3ered t)at Nature )ad a"read "icensed
t)e rig)ts to a 3irtua"" identica" co2/i"ation of ter2s of 3ener fro2 t)e
defendant, ;ein.= In <EE@, in an atte2/t to furt)er ca/ita"i1e on t)e
success of )is *oo$, 0i/ton soug)t to "icense )is co2/i"ation for use on
3arious /roducts. = 4)e 5rst and second editions of t)e *oo$, #)ic)
inc"ude scattered i""ustrations and eL/"anator teLt, #ere a considera*"e
success and )a3e so"d o3er <G@,@@@ co/ies to date. = According to 0i/ton,
)e trans"ated t)e ter2s fro2 Midd"e Eng"is) to 2odern Eng"is) and
arranged t)e2 *ased on t)eir 9"rica" and /oetic /otentia".: =0i/ton
co2/i"ed )is ter2s of 3ener t)roug) researc) of 3arious 5fteent)-centur
teLts and 2anuscri/ts.
In <EBB, ;ein, doing *usiness as 9Ani2a" ;isdo2,:
4)e Mu"titudes
/oster, as #e"" as a note cu*e 2ar$eted * Nature, inc"uded co/rig)t
notices in t)e na2es of ;ein and Nature.= 4)e cata"og co/
acco2/aning t)e Mu"titudes /oster stated, 9Mic)ae" ;ein )as sur3eed
t)e Eng"is) "anguage *ac$ to its ear"iest roots to co2/i"e a "ist of t)e 2ost
re2ar$a*"e M na2es of ani2a" 2u"titudes e3er asse2*"ed.: = Nature so"d
t)ese /roducts *ot) in its stores and t)roug) its cata"ogs. = Bet#een <EBE
and <EE@, Nature and ;ein entered into a series of "icensing agree2ents
* #)ic) Nature acIuired t)e rig)t to use ;ein8s co2/i"ation of ani2a"
ter2s on a series of /osters, t-s)irts, and ot)er /roducts, #)ic) ca2e to
*e $no#n as t)e 9Mu"titudes: /roducts. = In <EBB, )e a//roac)ed Nature,
a retai"er s/ecia"i1ing in /roducts a*out t)e en3iron2ent, to 2ar$et )is
co2/i"ation. = ;ein 2anufactured and so"d /osters %9t)e ;ein /osters:+ of
t)e co2/i"ation to 3arious 1oos, "i*raries, and ot)er entities. =5"ed for
co/rig)t registration of a co2/i"ation of ani2a" ter2s, re/resenting t)at
t)e #or$ #as origina" to )i2.
In its /ro2otiona" *roc)ure, A;E stated t)at it )ad 9t)oroug)"
researc)ed do1ens and do1ens of ani2a"s, 5s) and *irds to unco3er
correct ter2ino"og.:= In <EE<, ;ein incor/orated Ani2a" ;isdo2
Enter/rises to 2ar$et and distri*ute t)ese /roducts as t)e 9Ani2a"
Congregations: "ine of 2erc)andise. =Si2u"taneous", ;ein continued to
2ar$et and se"" 3arious ada/tations of t)e initia" ;ein /oster.
;)en t)e refused, 0i/ton *roug)t t)e /resent suit a""eging co/rig)t
infringe2ent and unfair co2/etition.=7/on "earning of Nature8s and ;ein8s
actions, 0i/ton sent a "etter de2anding t)at t)e sto/ and reIuesting
co2/ensation for t)e a""eged infringe2ent.
;ein and Eng"is) contend t)at t)e order of t)e ter2s on t)e scarf #as
9s)uNed: on t)e /oster to /"ace so2e of t)e 2ore co22on, recogni1a*"e
ter2s at t)e *eginning of t)e /oster and 9to 2a$e Ot)e ter2sP Qo# around
t)e /ieces of art#or$ inserted.:= Bot) )e and Eng"is) ins/ected t)e scarf,
and 5nding no co/rig)t notice, t/eset t)e ter2s "isted on it. = According
to ;ein, )e decided to 2ar$et t)e ter2s on t)e scarf as a /oster in <EBB. =
Bot) ;ein and )is art director, Mic)ae" Eng"is), testi5ed t)at t)e scarf #as
&age * of /*
t)e so"e source of t)e co2/i"ation featured on t)e initia" /oster t)at ;ein
2ar$eted to "i*raries and 2useu2s. = 4)is scarf #as 2ar$ed as an eL)i*it
during ;ein8s de/osition and #as a3ai"a*"e to t)e district court. =
According to ;ein, t)is scarf, #)ic) "isted AC ani2a" ter2s and one cr/tic
ter2-9a sno/tic of SCI:-#as an unso"icited /ro2otiona" ite2 fro2 an
unidenti5ed source. =;ein denies co/ing an edition of 0i/ton8s *oo$ and
c"ai2s t)at t)e ter2s used on t)e ;ein /oster and t)e Mu"titudes /roducts
#ere co/ied fro2 a *anner or scarf %9t)e scarf:+ t)at )e recei3ed in t)e
"ate <EJ@8s #)i"e #or$ing as an ad3ertising eLecuti3e in Ne# Yor$ Cit.
;ein c"ai2s t)at it #as not unti" se3era" ears "ater, in connection #it)
A;E8s 9Ani2a" Congregations: "ine, t)at )e conducted furt)er researc)
and incor/orated additiona" ter2s of 3ener t)at did not a//ear on t)e
scarf.= ;ein contends t)at after a//roac)ing Nature in t)e su22er of
<EBB, )e consu"ted anot)er source, Jo)n 4rain8s Re2ar$a*"e ;ords #it)
Astonis)ing Origins, *ut on" used t)e 4rain *oo$ to c)ec$ t)e accurac of
t)e ter2s in t)e co2/i"ation t)at )e )ad gi3en to Nature. = Ho#e3er, since
t)e 5"ing of t)is action, ;ein )as consistent" stated t)at t)e scarf #as t)e
source of t)e co2/i"ation. =;ein8s testi2on a*out t)e scarf is
contradicted * t)e fact t)at /rior to t)e 5"ing of 0i/ton8s co2/"aint, )e
re/resented to Nature and to 0i/ton8s attorne t)at )e )ad co2/i"ed t)e
"ist )i2se"f fro2 ter2s t)at )e )ad #ritten on s"i/s of /a/er o3er t)e
4)e court a"so found ;ein and A;E "ia*"e for 3io"ation of t)e 0an)a2 Act,
noting:=G@>%c+%D+. = 4)e court found ;ein and A;E "ia*"e for co/rig)t
infringe2ent and, citing ;ein8s 9contradictor eL/"anations: for t)e source
of )is co2/i"ation, found t)eir infringe2ent to *e #i""fu" /ursuant to <A
7.S.C. H= B o/inion dated Se/te2*er DC, <EEC and order and 6udg2ent
entered Octo*er <>, <EE>, t)e district court granted su22ar 6udg2ent in
fa3or of t)e /"ainti, on a"" counts against defendants ;ein and A;E. =
0i/ton 3. 4)e Nature Co., AB< !.Su//. <@CD %S...N.Y.<EED+. =On Januar <J,
<EED, t)e district court denied t)e defendants8 2otion to dis2iss, 5nding
t)at 0i/ton8s co2/i"ation of ter2s #as origina" to )i2 and t)erefore
/rotecti*"e under co/rig)t "a#.
>C%a+.= 4)ese co/rig)t notices M are fa"se designations of origin, and
constitute actiona*"e fa"se c"ai2s of origina"it under H=Nature featured
t#o se/arate co/rig)t notices on its /oster, in ;ein8s na2e for t)e
co2/i"ation, and in Nature8s na2e.
M &"ainti,8s /roof M gi3es rise to a re*utta*"e /resu2/tion of consu2er
confusion, #)ic) in turn entit"es /"ainti, to da2ages under t)e 0an)a2
According", t)e district court en6oined t)e defendants fro2 use of an
ter2s t)at, toget)er or se/arate", are su*stantia"" si2i"ar to t)ose found
in 0i/ton8s *oo$ and a#arded 0i/ton costs, attornes8 fees, and en)anced
statutor da2ages in t)e a2ount of ?<@@,@@@.=O/inion of Se/t. DC, <EEC,
at <D, <>.
4)e Su22ar Judg2ent StandardFA.
Ruinn 3. Sracuse Mode" Neig)*or)ood Cor/., J<C !.Dd >CB, >>G %Dd
Cir.<EB@+ %Iuoting SEC 3. Researc) Auto2ation Cor/., GBG !.Dd C<, CC %Dd
Cir.<EAB++.= !ina"", 9S2ere conc"usor a""egations or denia"s8: in "ega"
2e2oranda or ora" argu2ent are not e3idence and cannot * t)e2se"3es
create a genuine issue of 2ateria" fact #)ere none #ou"d ot)er#ise eList.
=Ce"oteL Cor/. 3. Catrett, >AA 7.S. C<A, CDD-DC, <@J S.Ct. DG>B, DGGD-GC,
E< 0.Ed.Dd DJG %<EBJ+. = 4)e non-2o3ing /art 2a defeat t)e su22ar
6udg2ent 2otion * /roducing suTcient s/eci5c facts to esta*"is) t)at
t)ere is a genuine issue of 2ateria" fact for tria". ='nig)t 3. 7.S. !ire Ins.
Co., B@> !.Dd E, <D %Dd Cir.<EBJ+, cert. denied, >B@ 7.S. ECD, <@A S.Ct.
<GA@, E> 0.Ed.Dd AJD %<EBA+. = ;)i"e t)e court 2ust 3ie# t)e inferences
to *e dra#n fro2 t)e facts in t)e "ig)t 2ost fa3ora*"e to t)e /art
o//osing t)e 2otion, Matsus)ita E"ec. Indus. Co. 3. Uenit) Radio Cor/.,
>AG 7.S. GA>, GBA, <@J S.Ct. <C>B, <CGJ, BE 0.Ed.Dd GCB %<EBJ+, a /art
2a not 9re" on 2ere s/ecu"ation or con6ecture as to t)e true nature of
t)e facts to o3erco2e a 2otion for su22ar 6udg2ent.: =Anderson 3.
0i*ert 0o**, Inc., >AA 7.S. D>D, D>A->B, <@J S.Ct. DG@G, DG<@, E<
0.Ed.Dd D@D %<EBJ+ %e2/)asis in origina"+. =9O4P)e 2ere eListence of so2e
a""eged factua" dis/ute *et#een t)e /arties #i"" not defeat an ot)er#ise
/ro/er" su//orted 2otion for su22ar 6udg2entK t)e reIuire2ent is t)at
t)ere *e no genuine issue of 2ateria" fact.: =!ed.R.Ci3.&. GJ%c+. = Su22ar
6udg2ent s)a"" *e granted 9if t)e /"eadings, de/ositions, ans#ers to
interrogatories, and ad2issions on 5"e, toget)er #it) t)e aTda3its M s)o#
t)at t)ere is no genuine issue as to an 2ateria" fact and t)at t)e 2o3ing
/art is entit"ed to a 6udg2ent as a 2atter of "a#.: = Hea" 3. Ric) &rods.
Cor/., EB< !.Dd JB, AD %Dd Cir.<EED+. =;e re3ie# a district court8s grant of
su22ar 6udg2ent de no3o to deter2ine #)et)er t)ere is a genuine issue
of 2ateria" fact and #)et)er t)e 2o3ing /art is entit"ed to 6udg2ent as a
2atter of "a#. F
4)e Co/rig)t C"ai2FB.
;ein and A;E c)a""enge t)e district court8s )o"ding t)at t)e engaged in
co/rig)t infringe2ent of 0i/ton8s *oo$ and t)at t)eir asserted
infringe2ent #as #i""fu".=G@>%c+%D+ a /"ainti, is entit"ed to en)anced
statutor da2ages of u/ to ?<@@,@@@ u/on /roof t)at a defendant8s
infringe2ent #as #i""fu". = 7nder <A 7.S.C. H='e &u*"ications 3. C)inato#n
4oda &u*"is)ing Enters., E>G !.Dd G@E, G<> %Dd Cir.<EE<+. =G@< et seI.,
&age 0 of /*
reIuires /roof t)at %<+ t)e /"ainti, )ad a 3a"id co/rig)t in t)e #or$
a""eged" infringed and %D+ t)e defendant infringed t)e /"ainti,8s co/rig)t
* co/ing /rotected e"e2ents of t)e /"ainti,8s #or$. =A successfu" c"ai2
of co/rig)t infringe2ent /ursuant to t)e Co/rig)t Act, <A 7.S.C. HF
4)e defendants argue t)at #)i"e 0i/ton8s *oo$ itse"f is /rotected, t)e
2ere co2/i"ation of t)e co""ecti3e nouns-#it)out t)e acco2/aning
art#or$ and eL/"anator teLt-is not /rotecti*"e *ecause t)e ter2s are
facts, and not t)e origina" #or$ of 0i/ton.=It is undis/uted t)at 0i/ton )as a
3a"id co/rig)t in t)e 5rst and second editions of )is *oo$, An ELa"tation of
A"t)oug) facts are considered to *e in t)e /u*"ic do2ain and t)erefore not
/rotecti*"e under co/rig)t "a#, see !eist &u*"ications, Inc. 3. Rura" 4e".
Ser3. Co., >EE 7.S. C>@, C>A, <<< S.Ct. <DBD, <DBB-BE, <<C 0.Ed.Dd CGB
%<EE<+, a co2/i"ation of facts 2a *e /rotecti*"e in certain instances.F
'e, E>G !.Dd at G<D %citing !eist, >EE 7.S. at CGA, <<< S.Ct. at <DEC-E>+.=
4)ree reIuire2ents 2ust *e 2et for a co2/i"ation to Iua"if as
/rotecti*"e: 9%<+ t)e co""ection and asse2*" of /reeListing dataK %D+ t)e
se"ection, coordination, or arrange2ent of t)at dataK and %C+ a resu"ting
#or$ t)at is origina", * 3irtue of t)e se"ection, coordination, or
arrange2ent of t)e data contained in t)e #or$.: =
4)e defendants dis/ute t)is 5nding, arguing t)at 0i/ton8s se"ection and
arrange2ent do not de2onstrate t)e reIuisite origina"it.=AB< !.Su//. at
<@C>. = 0i/ton8s arrange2ent of t)e ter2s #as origina" to )i2K )e did not
fo""o# an sort of a"/)a*etica", c)rono"ogica", or ot)er sste2.: =4)e
district court )e"d t)at t)e co2/i"ation of ter2s in 0i/ton8s *oo$ #as
/rotecti*"e: 9O0i/tonP used )is $no#"edge and fa2i"iarit #it) t)e cu"ture
of Midd"e Eng"is), as #e"" as )is o#n creati3it, in se"ecting t)e ter2s of
3ener t)at a//ear in An ELa"tation of 0ar$s.
!urt)er2ore, t)e defendants o,er not)ing to contradict 0i/ton8s assertion
t)at )e se"ected t)e ter2s 9*ased on O)isP su*6ecti3e, infor2ed and
creati3e 6udg2ent.:= 4)e #ere se"ected fro2 nu2erous 3ariations of
)undreds of a3ai"a*"e ter2s. = In co2/i"ing )is #or$, 0i/ton asse2*"ed
ter2s fro2 3arious 5fteent) centur teLts and 2anuscri/ts. = A"t)oug) t)e
defendants correct" assert t)at t)e ter2s t)e2se"3es are not origina", t)e
uncontradicted e3idence is t)at 0i/ton8s se"ection and arrange2ent of t)e
ter2s #ere origina". =!eist, >EE 7.S. at C>G, <<< S.Ct. at <DBA. =9Origina",
as t)e ter2 is used in co/rig)t, 2eans on" t)at t)e #or$ #as
inde/endent" created * t)e aut)or M and t)at it /ossesses at "east so2e
2ini2a" degree of creati3it.: =4)e a2ount of creati3it reIuired for
co/rig)t /rotection of a co2/i"ation is decided" s2a"". F
4)e district court correct" found 0i/ton8s co2/i"ation to *e /rotecti*"e.=
Because t)e defendants )a3e o,ered not)ing-a/art fro2 t)eir con6ecture
t)at t)e "ist #as rando2-to contradict 0i/ton8s assertions t)at )is
arrange2ent #as t)e /roduct of )is creati3e and aest)etic 6udg2ent,
t)ere is no 2ateria" factua" dis/ute. ='e, E>G !.Dd at G<> %5nding
arrange2ent of *usinesses in director to *e /rotecti*"e #)ere 9OtP)e
arrange2ent is in no sense 2ec)anica": and 9entai"ed t)e de 2ini2is
t)oug)t needed to #it)stand t)e origina"it reIuire2ent:+K cf. !eist, >EE
7.S. at CJC, <<< S.Ct. at <DEJ-EA %no co/rig)t /rotection #)ere na2es
arranged a"/)a*etica"" in #)ite /ages directorK 9OtP)e se"ection and
arrange2ent of facts cannot *e so 2ec)anica" or routine as to reIuire no
creati3it #)atsoe3er.:+. = ;e )a3e )e"d t)at #)i"e 92ec)anica":
arrange2ents, suc) as a"/)a*etica" or c)rono"ogica" order, do not dis/"a
t)e reIuisite origina"it, an 2ini2a" "e3e" of creati3it is suTcient to
render an arrange2ent /rotecti*"e. = 4)is argu2ent 2isconstrues
go3erning case "a#. = Instead, t)e argue t)at *ecause 0i/ton8s
arrange2ent does 9not fo""o# an sort of a"/)a*etica", c)rono"ogica", or
ot)er sste2,: it is in)erent" un/rotecti*"e under co/rig)t "a#. = 4)e
defendants do not c)a""enge 0i/ton8s state2ent t)at )is co2/i"ation does
not re/"icate t)e seIuence of ter2s in an of t)e 5fteent) centur sources
t)at )e consu"ted, nor do t)e contradict )is assertion t)at )e re/eated"
rearranged t)e ter2s *ased u/on )is o#n aest)etic 6udg2ent. =0i/ton8s
arrange2ent of t)e ter2s is si2i"ar" /rotecti*"e.
!erguson 3. NBC, Inc., GB> !.Dd <<<, <<C %Gt) Cir.<EAB+K Vaste 3.
'aiser2an, BJC !.Dd <@J<, <@JA-JB %Dd Cir.<EBB+ %sa2e+.= In t)e
a"ternati3e, 9OiPf t)e t#o #or$s are so stri$ing" si2i"ar as to /rec"ude t)e
/ossi*i"it of inde/endent creation, Sco/ingW 2a *e /ro3ed #it)out a
s)o#ing of access.: =;a"$er 3. 4i2e 0ife !i"2s, Inc., AB> !.Dd >>, >B %Dd
Cir.+, cert. denied, >AJ 7.S. <<GE, <@J S.Ct. DDAB, E@ 0.Ed.Dd AD< %<EBJ+. =
Since direct e3idence of co/ing is se"do2 a3ai"a*"e, 9OcPo/ing 2a *e
inferred #)ere a /"ainti, esta*"is)es t)at t)e defendant )ad access to t)e
co/rig)ted #or$ and t)at su*stantia" si2i"arities eList as to /rotecti*"e
2ateria" in t)e t#o #or$s.: =4)e second /rong of a successfu" co/rig)t
action reIuires /roof t)at t)e defendant co/ied /rotected e"e2ents of t)e
/"ainti,8s #or$. F
;)i"e it is true t)at ;ein initia"" ga3e Nature and 0i/ton8s attorne a
di,erent eL/"anation for t)e origin of )is= In so doing, t)e district court
re6ected ;ein8s eL/"anation t)at )e co/ied )is "ist of ter2s fro2 t)e scarf
as 9contradictor: and 9in)erent" incredi*"e.: =4)e court found ;ein and
A;E "ia*"e for co/rig)t infringe2ent as a 2atter of "a# *ased on t)e
9o3er#)e"2ing si2i"arit of ;ein8s S/roductW to 0i/ton8s #or$.: F 4)us,
;ein8s /re-"itigation state2ents a*out t)e origin of )is "ist did not /er2it
t)e court to disregard )is eL/"anation t)at )e co/ied t)e ter2s fro2 t)e
scarf.= !or t)e /ur/oses of a su22ar 6udg2ent 2otion, courts are
&age 1 of /*
reIuired to 3ie# t)e facts in t)e "ig)t 2ost fa3ora*"e to t)e /arties
o//osing t)e 2otion and to sus/end 6udg2ents on credi*i"it. = 4)is is
corro*orated * t)e de/osition testi2on of )is art director, Mic)ae"
Eng"is), and t)e fact t)at ;ein /roduced t)e scarf during disco3er. ="ist of
ter2s, since t)e ince/tion of t)e suit, ;ein )as consistent" 2aintained
t)at )e co/ied t)e ter2s direct" fro2 t)e scarf.
See ..C. Co2ics Inc. 3. Mini Vift S)o/, E<D !.Dd DE, CG %Dd Cir.<EE@+K C
Me"3i""e B. Ni22er= As a 2atter of "a#, 9innocent infringe2ent,: or
co/ing fro2 a t)ird source #rongfu"" co/ied fro2 t)e /"ainti,, #it)out
$no#"edge t)at t)e t)ird source #as infringing, does not a*so"3e a
defendant of "ia*i"it for co/rig)t infringe2ent. =;ein8s co/ing of t)e
scarf is in an e3ent no defense to a c"ai2 of infringe2ent. F ( 4)e
inIuir t)en *eco2es #)et)er t)e scarf itse"f #as infringing-t)at is,
#)et)er its 2anufacturer )ad access to 0i/ton8s #or$ and su*stantia"
si2i"arities eList *et#een t)e scarf and 0i/ton8s co2/i"ation, or #)et)er
t)e t#o #or$s are so stri$ing" si2i"ar as to /rec"ude t)e /ossi*i"it of
inde/endent creation.= If ;ein and A;E did co/ t)e "ist of ter2s fro2 t)e
scarf, t)at defense is una3ai"ing if t)e scarf itse"f #as an unaut)ori1ed
co/ of 0i/ton8s /rotected co2/i"ation. =<C.@B, at <C-DBE %<EEG+K .o"ori
!a*rics, Inc. 3. 4)e 0i2ited, Inc., JJD !.Su//. <C>A, <CG>-GG %S...N.Y.<EBA+
%0u2*ard, J., sitting * designation+ %5nding c"ot)ing retai"er "ia*"e for
infringe2ent *ased on retai"er8s sa"e of dresses 2ade fro2 fa*ric t)at,
un*e$no#nst to retai"er, infringed teLti"e con3erter8s co/rig)t+K see a"so
!it1gera"d &u*"is)ing Co. 3. Ba"or &u*"is)ing Co., B@A !.Dd <<<@, <<<C %Dd
Cir.<EBJ+ %9OIPntent or $no#"edge is not an e"e2ent of infringe2ent.:+. =
.a3id Ni22er, Ni22er on Co/rig)t H
See Ec$es 3. Card &rices 7/date, ACJ !.Dd BGE, BJC %Dd Cir.<EB>+
%9OCPourts )a3e regarded t)e eListence of co22on errors in t#o si2i"ar
#or$s as t)e strongest e3idence of /irac.:+ %interna" Iuotation 2ar$s
o2itted+.= A"t)oug) so2e of t)ose errors do eList in ot)er sources, t)e
furt)er su//ort our conc"usion t)at t)e scarf cou"d not )a3e se"ected t)e
sa2e ter2s inde/endent of 0i/ton8s *oo$. = !urt)er2ore, t)e scarf
contains at "east siL trans"ation errors t)at eListed in 0i/ton8s 5rst t#o
editions. = Indeed, t)e scarf inc"udes on" one ani2a" ter2-9co3e of
Iuai":-t)at does not a//ear in t)e 0i/ton co2/i"ation. = Out of t)e AA
di,erent ani2a" ter2s of 3ener t)at a//ear in t)e 5rst edition of An
ELa"tation of 0ar$s, AD of t)e2 are "isted on t)e scarf. = In /rinci/"e, t)e
scarf cou"d )a3e inc"uded an of t)e )undreds of ani2a" ter2s "isted in
3arious 5fteent) centur teLts and ot)er resources, *ut in fact, it 2i2ics
t)e "ist in 0i/ton8s *oo$ a"2ost eLact". = !irst, t)e scarf inc"udes
essentia"" t)e sa2e se"ection of ani2a"-re"ated ter2s as 0i/ton8s *oo$. =
According", #e 5nd t)at scarf infringed on 0i/ton8s co/rig)t. =A
co2/arison *et#een t)e se"ection and arrange2ent of ter2s in 0i/ton8s
*oo$ and t)e se"ection and arrange2ent of t)ose on t)e scarf "eads us to
conc"ude t)at t)e t#o are 9stri$ing" si2i"ar.: F
In fact, t)e t)irteent) t)roug) t)e t#ent-5ft) ter2s on t)e scarf are
"isted in /recise" t)e sa2e order as in t)e 5rst edition of An ELa"tation of
0ar$s.= Of t)e 5rst t#ent-53e ter2s on t)e scarf, t#ent-four are "isted in
0i/ton8s *oo$, and a"" *ut four of t)e2 are "isted in t)e sa2e order. =
Second, t)e arrange2ent of ter2s on t)e scarf is a"so so stri$ing" si2i"ar
to t)e arrange2ent in 0i/ton8s *oo$ as to /rec"ude an inference of
inde/endent creation.
In "ig)t of t)e 2i""ions u/on 2i""ions of /ossi*"e
arrange2ents,=In at "east four ot)er /"aces on t)e scarf a string of four or
2ore ter2s a//ears in t)e sa2e order as in 0i/ton8s *oo$. =
t)e scarf8s
c"ose 2i2ic$ing of 0i/ton8s arrange2ent "eads ine3ita*" to a 5nding of
i2/ro/er co/ing.
;e t)erefore aTr2 t)e district court8s order of su22ar 6udg2ent to
0i/ton on its co/rig)t c"ai2 against ;ein and A;E.= B co/ing t)e scarf-
an unaut)ori1ed co/ t)at infringed on 0i/ton8s /rotected co2/i"ation-
;ein and A;E a"so infringed. =;ein fu"" ac$no#"edged t)at )e co/ied t)e
scarf for use on t)e origina" ;ein /roducts, Nature8s Mu"titudes /roducts,
and t)e Ani2a" Congregations "ine current" *eing distri*uted * ;ein
t)roug) A;E.
;)en an o#ner esta*"is)es t)at t)e defendant8s infringe2ent #as 9=
G@>%c+, a co/rig)t o#ner 2a e"ect to reco3er statutor da2ages in "ieu
of actua" da2ages. = 7nder <A 7.S.C. H=4)e defendants a"so c)a""enge t)e
district court8s 5nding t)at t)eir infringe2ent of 0i/ton8s co/rig)t #as
#i""fu". N.A.S. I2/ort Cor/. 3. C)enson Enters., Inc., EJB !.Dd DG@, DGD %Dd
Cir.<EED+.=G@>%c+%D+ #)ere t)e defendant )ad $no#"edge t)at its conduct
constituted infringe2ent or s)o#ed rec$"ess disregard for t)e co/rig)t
)o"der8s rig)ts. = ;e )a3e /re3ious" )e"d t)at a defendant8s co/rig)t
infringe2ent #i"" *e found #i""fu" /ursuant to H=G@>%c+%D+. =<A 7.S.C. H=
#i""fu",: t)e statute /er2its t)e court, at its discretion, to increase its
a#ard of da2ages to a 2aLi2u2 of ?<@@,@@@.
4)e defendants argue t)at %<+ t)e issue of t)eir #i""fu" infringe2ent #as
an inIuir into t)eir state of 2ind t)at 2ust *e decided * a 6ur-not *
t)e court on su22ar 6udg2ent, and %D+ e3en if #i""fu"ness cou"d *e
decided on su22ar 6udg2ent, t)e district court8s ru"ing #as in error
*ecause it ignored ;ein8s c"ai2 t)at )e co/ied t)e ter2s fro2 t)e scarf.=
On 0i/ton8s 2otion for su22ar 6udg2ent, t)e district court found ;ein
and A;E to *e #i""fu" infringers, *asing its deter2ination on t)e fact t)at
;ein 9continua"" c)anged )is stor as to t)e origin of )is ter2s suc) t)at
an good fait) /rotestations on )is /art are in)erent" incredi*"e.:
;e re2and for tria" on t)e Iuestion of ;ein8s #i""fu"ness or rec$"ess
disregard of 0i/ton8s co/rig)t.=G@>%c+%D+. = According", #e re3erse t)e
district court8s a#ard of su22ar 6udg2ent to 0i/ton on t)e Iuestion of
#i""fu" infringe2ent and its a#ard of en)anced da2ages /ursuant to <A
&age / of /*
7.S.C. H= 4)e district court erred in conc"uding, on a su22ar 6udg2ent
2otion, t)at ;ein #i""fu"" infringed 0i/ton8s co/rig)t *ased on its
deter2ination t)at ;ein8s stor a*out t)e scarf #as 9in)erent"
incredi*"e.: =7nited States 3. Re2, CB !.Cd JC>, J>C->> %Dd Cir.<EE>+. =
.eter2inations of credi*i"it are #it)in t)e /ro3ince of t)e 6ur and 2a
not *e reso"3ed on su22ar 6udg2ent. = ;ein dis/utes t)e assertion t)at
)e #i""fu"" co/ied fro2 An ELa"tation of 0ar$s, arguing t)at )e innocent"
co/ied fro2 t)e scarf #)at )e *e"ie3ed to *e an un/rotecta*"e
co2/i"ation. = Ho#e3er, t)is is not suc) a case. = See Resource
.e3e"o/ers, Inc. 3. Statue of 0i*ert-E""is Is"and !ound., Inc., EDJ !.Dd <C>,
<>< %Dd Cir.<EE<+. =A"t)oug) courts are genera"" re"uctant to dis/ose of a
case on su22ar 6udg2ent #)en 2enta" state is at issue, it is /er2issi*"e
to do so #)ere t)ere are suTcient undis/uted 2ateria" facts on t)e record
to 2a$e t)e Iuestion a//ro/riate for su22ar 6udg2ent. F
7nfair Co2/etition C"ai2s under t)e 0an)a2 ActFC.
<<DG%a+%<+= Su*section %A+ of <G 7.S.C. H=<<DG%a+. =>C%a+ of t)e 0an)a2
Act, <G 7.S.C. H=4)e defendants a"so c)a""enge t)e district court8s a#ard of
su22ar 6udg2ent to 0i/ton on )is unfair co2/etition c"ai2 under H

0i/ton a""eges t)at t)e defendants engaged in t)e /ro)i*ited /ractice of
9re3erse /assing o,:-t)at is, )e c"ai2s t)at ;ein and A;E atte2/ted to
se"" 0i/ton8s origina" co2/i"ation under ;ein8s o#n na2e, in 3io"ation of
t)e 0an)a2 Act.=/ro)i*its an 2isre/resentation "i$e" to cause confusion
as to t)e source or t)e 2anufacturer of a /roduct.
;a"d2an &u*"is)ing Cor/. 3. 0ando"", Inc., >C !.Cd AAG, AB<-BG %Dd
Cir.<EE>+.=A successfu" c"ai2 for 9re3erse /assing o,: under t)e 0an)a2
Act reIuires t)at t)e /"ainti, /ro3e %<+ t)at t)e #or$ at issue originated
#it) t)e /"ainti,K %D+ t)at origin of t)e #or$ #as fa"se" designated * t)e
defendantK %C+ t)at t)e fa"se designation of origin #as "i$e" to cause
consu2er confusionK and %>+ t)at t)e /"ainti, #as )ar2ed * t)e
defendant8s fa"se designation of origin. F
>C%a+ of t)e 0an)a2 Act.= ;e 5nd t)at, as a 2atter of "a#, a fa"se
co/rig)t notice a"one cannot constitute a fa"se designation of origin
#it)in t)e 2eaning of H=In t)e instant case, t)e district court *ased its
5nding of a 0an)a2 Act 3io"ation on t)e fact t)at t)e co/rig)t notices on
t)e infringing /roducts #ere fa"se designations of origin. F
A"t)oug) #e found a co/rig)t 3io"ation, #e re6ected 'regos8 0an)a2 Act
c"ai2, )o"ding t)at 9OiPf 'regos is si2/" saing t)at t)e notice is fa"se in
c"ai2ing creation * S/orts !eatures in t)at t)e for2 is, under t)e
co/rig)t "a#, an infringe2ent of 'regos8 for2, #e r= A& /u*"is)ed t)e
co/ied for2 #it) S/orts !eatures8 co/rig)t, in 3io"ation of 'regos8
/rotected interest in )is origina" for2. = 4)at case in3o"3ed a dis/ute o3er
a for2 used to dis/"a *ase*a"" /itc)ing statistics created and distri*uted
* t)e /"ainti,, 'regos, and co/ied and /u*"is)ed * t)e defendants,
S/orts !eatures Sndicate, Inc. %9S/orts !eatures:+ and t)e Associated
&ress %9A&:+. =In 'regos 3. Associated &ress, ECA !.Dd A@@, A<@-<< %Dd
Cir.<EE<+, #e re6ected a /"ainti,8s atte2/t to turn its successfu" co/rig)t
c"ai2 into a 0an)a2 Act c"ai2 for fa"se designation of origin. Because t)e
district court *ased its 5nding of a fa"se designation of origin so"e" on t)e
/resence of ;ein8s fa"se co/rig)t notice, #e re3erse t)e a#ard of
su22ar 6udg2ent to 0i/ton on its 0an)a2 Act c"ai2.=Id. at A<<. =e6ect
)is atte2/t to con3ert a"" co/rig)t c"ai2s into 0an)a2 Act 3io"ations.:
>C%a+ "ia*i"it *ased on co/rig)t infringe2ent a"one: 9OtP)ere 2ust eList
so2e aTr2ati3e act #)ere* Ot)e defendantP fa"se" re/resented itse"f as
t)e o#nerM:+.=>C%a+ "ia*i"it #)ere co/rig)t notice on infringing /roduct
#as not 2ere" fa"se, *ut a"so 2ade t)e additiona" re/resentation t)at t)e
/roduct #as 9origina":+K Cognotec Ser3ices 0td. 3. Morgan Vuarant 4rust
Co., BJD !.Su//. >G, G< %S...N.Y.<EE>+ %5nding no H= 'regos, ECA !.Dd at
A<@K see a"so Eden 4os, Inc. 3. !"ore"ee 7ndergar2ent Co., JEA !.Dd DA,
CA %Dd Cir.<EBD+ %5nding H= Indeed, t)is /ossi*i"it is "eft o/en * 'regos
itse"f, in #)ic) C)ief Judge Ne#2an noted t)at, a"t)oug) a fa"se co/rig)t
a"one #ou"d *e insuTcient as a fa"se designation of origin, 9'regos cou"d
co2/"ain M if S/orts !eatures unfair" co2/eted #it) )i2 * fa"se"
c"ai2ing t)at its for2 #as originated * so2e #e""-$no#n *ase*a"" /"aer.:
= ;a"d2an, >C !.Cd at AB<. = In ;a"d2an, #e found t)at t)e 9re/roduction
of a #or$ #it) a fa"se re/resentation as to its creator: cou"d su//ort a
5nding of fa"se designation origin #)ere t)e defendant fai"ed to credit t)e
origina" creator. = ;e 2ere" )o"d t)at t)e eListence of a fa"se co/rig)t
notice a"one is insuTcient. =In doing so, #e o,er no o/inion as to #)et)er
or not t)ere 2ig)t *e ot)er grounds to su//ort a 0an)a2 Act c"ai2 *ased
on fa"se designation of origin.
<<DG%a+%<+%B+.=0i/ton counters t)at e3en if )is fa"se designation of origin
c"ai2 fai"s, )e is entit"ed to su22ar 6udg2ent on )is c"ai2 for fa"se
ad3ertising /ursuant to <G 7.S.C. HF
See Castro" Inc. 3. &enn1oi" Co., EBA
!.Dd ECE, E>G %Cd Cir.<EEC+.= Second, ;ein8s genera" assertions t)at )e
conducted t)oroug) researc) in co2/i"ing )is "ist of ter2s is 2ere
9/uTng: and does not constitute fa"se ad3ertising. = !irst, t)e state2ents
in Nature8s cata"og are irre"e3ant, inas2uc) as 0i/ton o,ers no e3idence
t)at t)ese state2ents originated #it) ;ein and Nature is not a /art to
t)is a//ea". = ;e 5nd t)at neit)er state2ent su//orts a fa"se ad3ertising
c"ai2 against ;ein or A;E. =He argues t)at t)e state2ents 2ade in t)e
Nature cata"og co/ %t)at ;ein researc)ed t)e Eng"is) "anguage to its
ear"iest roots+, and in A;E8s Ani2a" Congregations /ro2otiona" *roc)ure
%t)at )e 9t)oroug)" researc)ed do1ens and do1ens of ani2a"s:+ #ere
fa"se, 2ateria", and 2is"eading. =
4)us, #e re3erse t)e district court8s su22ar 6udg2ent on 0i/ton8s
0an)a2 Act c"ai2s.= Vroden 3. Rando2 House, Inc., No. E> Ci3. <@A>,
<EE> ;0 >GGGGG, at XG %S...N.Y. Aug. DC, <EE>+, a,8d, J< !.Cd <@>G %Dd
Cir.<EEG+K see Bose Cor/. 3. 0inear .esign 0a*s, Inc., >JA !.Dd C@>, C<@-<<
&age , of /*
%Dd Cir.<EAD+ %5nding defendant8s c"ai2 t)at its 9count"ess )ours of
researc): "ed to t)e su/erior Iua"it of its stereo s/ea$ers to *e "arge"
/uTng+. =9Su*6ecti3e c"ai2s a*out /roducts, #)ic) cannot *e /ro3en
eit)er true or fa"se, are not actiona*"e under t)e 0an)a2 Act.: =
!urt)er2ore, ;ein8s genera" assertion t)at t)e researc) )e conducted #as
9t)oroug)OP: is 2ere 9/uTng: and t)erefore, not actiona*"e. = 0i/ton )as
o,ered not)ing to contradict ;ein8s assertion t)at )e conducted
inde/endent researc) at t)e Ne# Yor$ &u*"ic 0i*rar /rior to ad3ertising
t)e Ani2a" Congregations "ine. =McNei"-&.C.C., Inc. 3. Bristo"-Mers SIui**
Co., ECB !.Dd <G>>, <G>E %Dd Cir.<EE<+. = !a"sit 2a *e esta*"is)ed *
/ro3ing t)at %<+ t)e ad3ertising is "itera"" fa"se as a factua" 2atter, or %D+
a"t)oug) t)e ad3ertise2ent is "itera"" true, it is "i$e" to decei3e or
confuse consu2ers. =>C%a+ t)e /"ainti, 2ust de2onstrate t)at t)e
2essage in t)e c)a""enged ad3ertise2ent is fa"se. =4o esta*"is) a fa"se
ad3ertising c"ai2 /ursuant to HF
4)e In6unctionF..
As /art of an acco2/aning 2e2orandu2-intended as an a2end2ent to
t)e order and 6udg2ent-t)e district court eL/ounded u/on t)e sco/e of
t)e in6unction:=As /art of its order and 6udg2ent entered Octo*er <>,
<EE>, t)e district court issued a /er2anent in6unction /ro)i*iting ;ein
and A;E fro2 co/ing, /roducing, or se""ing an infringing /roducts or
9an ot)er /roducts su*stantia"" si2i"ar to t)e said infringing /roducts
andYor incor/orating, in #)o"e or in /art, /"ainti,8s co/rig)ted and
in)erent" distincti3e co2/i"ation.: F
4)erefore, I 5nd t)at defendant ;ein and OA;EP s)ou"d *e en6oined fro2
an use of /"ainti,8s ter2s, toget)er or se/arate"M=;ein can )ard" *e
/er2itted to 2ar$et t)e /arts, )a3ing *een found to )a3e 2isa//ro/riated
t)e #)o"e. =In t)is case, #e )a3e a defendant #)o M #as #rongfu""
co/ing 3irtua"" /"ainti,8s entire co2/i"ation, OandP is no# current"
2ar$eting 4-s)irts and ot)er /roducts using *ut sing"e ter2s co/ied fro2
O/"ainti,8s *oo$PM
C Ni22er= 4)is /)rase )as *een inter/reted to 2ean t)at a court8s
aut)orit to issue an in6unction in a co/rig)t case s)ou"d *e "i2ited in
sco/e to t)at /art of t)e #or$ t)at is /rotecti*"e. =G@D, a /er2anent
in6unction 2a issue on suc) ter2s as t)e court dee2s 9reasona*"e to
/re3ent or restrain infringe2ent of a co/rig)t.: =&ursuant to <A 7.S.C. H (
According", #e re2and #it) instructions to a2end t)e in6unction, and for
suc) furt)er /roceedings as 2a *e a//ro/riate in t)e circu2stances,
inc"uding t)e a#ard of costs and attornes8 fees #it) res/ect to t)e
co/rig)t c"ai2.= B so )o"ding, )o#e3er, #e do not forec"ose t)e
/ossi*i"it t)at an in6unction 2ig)t *e a//ro/riate to /ro)i*it ;ein fro2
/roducing or 2ar$eting a 2ore eLtensi3e "ine of /roducts t)at infringes
0i/ton8s se"ection of ter2s. = 4)us, t)e district court erred in en6oining
;ein fro2 /roducing and 2ar$eting a "ine of siL di,erent 4-s)irts and
2ugs, eac) dis/"aing a di,erent ani2a" ter2 of 3ener. = In t)e instant
case, it is t)e co2/i"ation-i.e., t)e se"ection and arrange2ent-of t)e ter2s
t)at is /rotecti*"e, not t)e indi3idua" ter2s t)e2se"3es. = Because
su22ar 6udg2ent #as /ro/er so"e" on t)e /"ainti,8s co/rig)t cause of
action, #e 5nd t)e district court8s in6unction to *e eLcessi3e" *road. =
<>.@JOCP, at <>-<@E %94)e sco/e of t)e in6unction t)erefore, s)ou"d
genera"" *e no *roader t)an t)e infringe2ent, and *ecause facts M are
ne3er co/rig)ta*"e, no in6unction s)ou"d eLtend to for*id re/roduction of
t)ose factsM: %citing Ja2es 0. Oa$es, Co/rig)ts and Co/re2edies: 7nfair
7se and In6unctions, CB J. Co/rig)t Soc8 JC, A<-B< %<EE@+++K see 'e/ner-
4regoe, Inc. 3. 0eaders)i/ Soft#are, Inc., <D !.Cd GDA, GCB %Gt) Cir.+ %#)ere
district court found defendant "ia*"e for co/rig)t infringe2ent of
co2/uter /rogra2, it "ac$ed t)e aut)orit to generica"" en6oin t)e
defendant fro2 a"" future 2odi5cations of t)e /rogra2 at issue+, cert.
denied, G<C 7.S. BD@, <<G S.Ct. BD, <C@ 0.Ed.Dd CG %<EE>+. =Ni22er,
Ni22er on Co/rig)t H
4o su22ari1e:
;e aTr2 t)e district court8s 5nding t)at /"ainti,8s co""ection of ani2a"
ter2s #as a /rotecti*"e co2/i"ation * 3irtue of its origina" se"ection and
arrange2ent of t)ose ter2s.F<.
;e aTr2 t)e grant of su22ar 6udg2ent on t)e /"ainti,8s co/rig)t c"ai2
*ased on t)e defendants8 ad2itted co/ing fro2 an unaut)ori1ed and
infringing source.FD.
G@>%c+%D+.=;e re3erse t)e a#ard * su22ar 6udg2ent of en)anced
statutor da2ages /ursuant to <A 7.S.C. HFC.
<<DG 2a not *e *ased so"e" on t)e /resence of a fa"se co/rig)t notice,
and %*+ t)e defendants8 re/resentations a*out t)e eLtent of t)eir researc)
#ere 2ere" 9/uTng: and did not constitute fa"se ad3ertising #it)in t)e
2eaning of t)e 0an)a2 Act.=;e re3erse t)e grant of su22ar 6udg2ent
on t)e /"ainti,8s 0an)a2 Act c"ai2s on t)e grounds t)at %a+ a c"ai2 for
fa"se designation of origin /ursuant to <G 7.S.C. HF>.
;e re2and t)e cause to t)e district court for an a//ro/riate a2end2ent
of t)e o3er*road in6unction, for tria" on t)e Iuestion of t)e defendants8
#i""fu"ness or rec$"ess disregard of 0i/ton8s co/rig)t, and for suc) furt)er
/roceedings as 2a *e dee2ed a//ro/riate in "ig)t of t)is o/inion.FG.
4.#. No. */+000 Au3ust *,, 0551
&age 6 of /*
P$A#L 7 $AN 8P9IL.:, INCO#PO#AT$, &etitioner,
S9O$%A#T, INCO#PO#AT$, and NO#T9 $SA %A#;$TIN4,
INCO#PO#AT$, Res/ondents.
. E C I S I O N
In t)e instant /etition for re3ie# on certiorari under Ru"e >G of t)e
Ru"es of Court, /etitioner &ear" ( .ean %&)i".+ Inc. %& ( .+ assai"s t)e
Ma DD, D@@< decision
of t)e Court of A//ea"s re3ersing t)e Octo*er
C<, <EEJ decision
of t)e Regiona" 4ria" Court of Ma$ati, Branc) <CC, in
Ci3i" Case No. ED-G<J #)ic) dec"ared /ri3ate res/ondents S)oe2art
Inc. %SMI+ and Nort) Edsa Mar$eting Inc. %NEMI+ "ia*"e for infringe2ent
of trade2ar$ and co/rig)t, and unfair co2/etition.
4)e Ma DD, D@@< decision of t)e Court of A//ea"s
contained a
su22ar of t)is dis/ute:
Z&"ainti,-a//e""ant &ear" and .ean %&)i".+, Inc. is a cor/oration engaged
in t)e 2anufacture of ad3ertising dis/"a units si2/" referred to as
"ig)t *oLes. 4)ese units uti"i1e s/ecia"" /rinted /osters sand#ic)ed
*et#een /"astic s)eets and i""u2inated #it) *ac$ "ig)ts. &ear" and
.ean #as a*"e to secure a Certi5cate of Co/rig)t Registration dated
Januar D@, <EB< o3er t)ese i""u2inated dis/"a units. 4)e ad3ertising
"ig)t *oLes #ere 2ar$eted under t)e trade2ar$ Z&oster AdsZ. 4)e
a//"ication for registration of t)e trade2ar$ #as 5"ed #it) t)e Bureau
of &atents, 4rade2ar$s and 4ec)no"og 4ransfer on June D@, <EBC, *ut
#as a//ro3ed on" on Se/te2*er <D, <EBB, /er Registration No.
><<JG. !ro2 <EB< to a*out <EBB, &ear" and .ean e2/"oed t)e
ser3ices of Metro Industria" Ser3ices to 2anufacture its ad3ertising
So2eti2e in <EBG, &ear" and .ean negotiated #it) defendant-
a//e""ant S)oe2art, Inc. %SMI+ for t)e "ease and insta""ation of t)e "ig)t
*oLes in SM Cit Nort) Edsa. Since SM Cit Nort) Edsa #as under
construction at t)at ti2e, SMI o,ered as an a"ternati3e, SM Ma$ati and
SM Cu*ao, to #)ic) &ear" and .ean agreed. On Se/te2*er <<, <EBG,
&ear" and .eanWs Venera" Manager, Rodo"fo [ergara, su*2itted for
signature t)e contracts co3ering SM Cu*ao and SM Ma$ati to SMIWs
Ad3ertising &ro2otions and &u*"icit .i3ision Manager, Ra2on"ito
A*ano. On" t)e contract for SM Ma$ati, )o#e3er, #as returned
signed. On Octo*er >, <EBG, [ergara #rote A*ano inIuiring a*out t)e
ot)er contract and re2inding )i2 t)at t)eir agree2ent for insta""ation
of "ig)t *oLes #as not on" for its SM Ma$ati *ranc), *ut a"so for SM
Cu*ao. SMI did not *ot)er to re/".
Instead, in a "etter dated Januar <>, <EBJ, SMIWs )ouse counse"
infor2ed &ear" and .ean t)at it #as rescinding t)e contract for SM
Ma$ati due to non-/erfor2ance of t)e ter2s t)ereof. In )is re/" dated
!e*ruar <A, <EBJ, [ergara /rotested t)e uni"atera" action of SMI,
saing it #as #it)out *asis. In t)e sa2e "etter, )e /us)ed for t)e
signing of t)e contract for SM Cu*ao.
4#o ears "ater, Metro Industria" Ser3ices, t)e co2/an for2er"
contracted * &ear" and .ean to fa*ricate its dis/"a units, o,ered to
construct "ig)t *oLes for S)oe2artWs c)ain of stores. SMI a//ro3ed t)e
/ro/osa" and ten %<@+ "ig)t *oLes #ere su*seIuent" fa*ricated *
Metro Industria" for SMI. After its contract #it) Metro Industria" #as
ter2inated, SMI engaged t)e ser3ices of EY. Rain*o# Ad3ertising
Cor/oration to 2a$e t)e "ig)t *oLes. So2e C@@ units #ere fa*ricated
in <EE<. 4)ese #ere de"i3ered on a staggered *asis and insta""ed at
SM Mega2a"" and SM Cit.
So2eti2e in <EBE, &ear" and .ean, recei3ed re/orts t)at eLact co/ies
of its "ig)t *oLes #ere insta""ed at SM Cit and in t)e fastfood section
of SM Cu*ao. 7/on in3estigation, &ear" and .ean found out t)at aside
fro2 t)e t#o %D+ re/orted SM *ranc)es, "ig)t *oLes si2i"ar to t)ose it
2anufactures #ere a"so insta""ed in t#o %D+ ot)er SM stores. It furt)er
disco3ered t)at defendant-a//e""ant Nort) Edsa Mar$eting Inc. %NEMI+,
t)roug) its 2ar$eting ar2, &ri2e S/ots Mar$eting Ser3ices, #as set u/
/ri2ari" to se"" ad3ertising s/ace in "ig)ted dis/"a units "ocated in
SMIWs di,erent *ranc)es. &ear" and .ean noted t)at NEMI is a sister
co2/an of SMI.
In t)e "ig)t of its disco3eries, &ear" and .ean sent a "etter dated
.ece2*er <<, <EE< to *ot) SMI and NEMI en6oining t)e2 to cease
using t)e su*6ect "ig)t *oLes and to re2o3e t)e sa2e fro2 SMIWs
esta*"is)2ents. It a"so de2anded t)e discontinued use of t)e
trade2ar$ Z&oster Ads,Z and t)e /a2ent to &ear" and .ean of
co2/ensator da2ages in t)e a2ount of 4#ent Mi""ion &esos
7/on recei/t of t)e de2and "etter, SMI sus/ended t)e "easing of t#o
)undred t#ent-four %DD>+ "ig)t *oLes and NEMI too$ do#n its
ad3ertise2ents for Z&oster AdsZ fro2 t)e "ig)ted dis/"a units in SMIWs
stores. C"ai2ing t)at *ot) SMI and NEMI fai"ed to 2eet a"" its
de2ands, &ear" and .ean 5"ed t)is instant case for infringe2ent of
trade2ar$ and co/rig)t, unfair co2/etition and da2ages.
&age < of /*
In dening t)e c)arges )ur"ed against it, SMI 2aintained t)at it
inde/endent" de3e"o/ed its /oster /ane"s using co22on" $no#n
tec)niIues and a3ai"a*"e tec)no"og, #it)out notice of or reference to
&ear" and .eanWs co/rig)t. SMI noted t)at t)e registration of t)e 2ar$
Z&oster AdsZ #as on" for stationeries suc) as "etter)eads, en3e"o/es,
and t)e "i$e. Besides, according to SMI, t)e #ord Z&oster AdsZ is a
generic ter2 #)ic) cannot *e a//ro/riated as a trade2ar$, and, as
suc), registration of suc) 2ar$ is in3a"id. It a"so stressed t)at &ear"
and .ean is not entit"ed to t)e re"iefs /raed for in its co2/"aint since
its ad3ertising dis/"a units contained no co/rig)t notice, in 3io"ation
of Section DA of &... >E. SMI a""eged t)at &ear" and .ean )ad no cause
of action against it and t)at t)e suit #as /ure" intended to 2a"ign
SMIWs good na2e. On t)is *asis, SMI, aside fro2 /raing for t)e
dis2issa" of t)e case, a"so counterc"ai2ed for 2ora", actua" and
eLe2/"ar da2ages and for t)e cance""ation of &ear" and .eanWs
Certi5cation of Co/rig)t Registration No. &.-R-DGGB dated Januar
D@, <EB< and Certi5cate of 4rade2ar$ Registration No. ><JG dated
Se/te2*er <D, <EBB.
NEMI, for its /art, denied )a3ing 2anufactured, insta""ed or used an
ad3ertising dis/"a units, nor )a3ing engaged in t)e *usiness of
ad3ertising. It re/"eaded SMIWs a3er2ents, ad2issions and denia"s and
/raed for si2i"ar re"iefs and counterc"ai2s as SMI.Z
4)e R4C of Ma$ati Cit decided in fa3or of & ( .:
;)erefore, defendants SMI and NEMI are found 6oint" and se3era""
"ia*"e for infringe2ent of co/rig)t under Section D of &. >E, as
a2ended, and infringe2ent of trade2ar$ under Section DD of RA No.
<JJ, as a2ended, and are )ere* /ena"i1ed under Section DB of &.
>E, as a2ended, and Sections DC and D> of RA <JJ, as a2ended.
According", defendants are )ere* directed:
%<+ to /a /"ainti, t)e fo""o#ing da2ages:
%a+ actua" da2ages - &<J,J@@,@@@.@@,
re/resenting /ro5ts
deri3ed * defendants
as a resu"t of infringe-
2ent of /"ainti,Ws co/rig)t
fro2 <EE< to <EED
%*+ 2ora" da2ages - &<,@@@.@@@.@@
%c+ eLe2/"ar da2ages - &<,@@@,@@@.@@
%d+ attorneWs fees - &<,@@@,@@@.@@
%e+ costs of suitK
%D+ to de"i3er, under oat), for i2/ounding in t)e Nationa"
0i*rar, a"" "ig)t *oLes of SMI #)ic) #ere fa*ricated * Metro
Industria" Ser3ices and EY. Rain*o# Ad3ertising Cor/orationK
%C+ to de"i3er, under oat), to t)e Nationa" 0i*rar, a"" 5""er-
/osters using t)e trade2ar$ Z&oster AdsZ, for destructionK and
%>+ to /er2anent" refrain fro2 infringing t)e co/rig)t on
/"ainti,Ws "ig)t *oLes and its trade2ar$ Z&oster AdsZ.
.efendantsW counterc"ai2s are )ere* ordered dis2issed for "ac$ of
On a//ea", )o#e3er, t)e Court of A//ea"s re3ersed t)e tria" court:
Since t)e "ig)t *oLes cannot, * an stretc) of t)e i2agination, *e
considered as eit)er /rints, /ictoria" i""ustrations, ad3ertising co/ies,
"a*e"s, tags or *oL #ra/s, to *e /ro/er" c"assi5ed as a co/rig)ta*"e
c"ass ZOZ #or$, #e )a3e to agree #it) SMI #)en it /osited t)at #)at
#as co/rig)ted #ere t)e tec)nica" dra#ings on", and not t)e "ig)t
*oLes t)e2se"3es, t)us:
>D. ;)en a dra#ing is tec)nica" and de/icts a uti"itarian o*6ect, a
co/rig)t o3er t)e dra#ings "i$e /"ainti,-a//e""antWs #i"" not eLtend to
t)e actua" o*6ect. It )as so *een )e"d under 6uris/rudence, of #)ic)
t)e "eading case is Ba$er 3s. Se"den %<@< 7.S. B>< %<BAE+. In t)at case,
Se"den )ad o*tained a co/rig)t /rotection for a *oo$ entit"ed
ZSe"denWs Condensed 0edger or Boo$$ee/ing Si2/"i5edZ #)ic)
/ur/orted to eL/"ain a ne# sste2 of *oo$$ee/ing. Inc"uded as /art of
t)e *oo$ #ere *"an$ for2s and i""ustrations consisting of ru"ed "ines
and )eadings, s/ecia"" designed for use in connection #it) t)e
sste2 eL/"ained in t)e #or$. 4)ese for2s s)o#ed t)e entire
o/eration of a da or a #ee$ or a 2ont) on a sing"e /age, or on t#o
/ages fo""o#ing eac) ot)er. 4)e defendant Ba$er t)en /roduced for2s
#)ic) #ere si2i"ar to t)e for2s i""ustrated in Se"denWs co/rig)ted
*oo$s. 4)e Court )e"d t)at eLc"usi3it to t)e actua" for2s is not
eLtended * a co/rig)t. 4)e reason #as t)at Zto grant a 2ono/o" in
&age + of /*
t)e under"ing art #)en no eLa2ination of its no3e"t )as e3er *een
2ade #ou"d *e a sur/rise and a fraud u/on t)e /u*"icK t)at is t)e
/ro3ince of "etters /atent, not of co/rig)t.Z And t)at is /recise" t)e
/oint. No dou*t a#are t)at its a""eged origina" design #ou"d ne3er
/ass t)e rigorous eLa2ination of a /atent a//"ication, /"ainti,-
a//e""ant foug)t to foist a fraudu"ent 2ono/o" on t)e /u*"ic *
con3enient" resorting to a co/rig)t registration #)ic) 2ere"
e2/"os a recorda" sste2 #it)out t)e *ene5t of an in-de/t)
eLa2ination of no3e"t.
4)e /rinci/"e in Baker vs. Selden #as "i$e#ise a//"ied in Muller vs.
Triborough Bridge Authority O>C !. Su//. DEB %S...N.Y. <E>D+P. In t)is
case, Mu""er )ad o*tained a co/rig)t o3er an un/u*"is)ed dra#ing
entit"ed ZBridge A//roac) \ t)e dra#ing s)o#ed a no3e" *ridge
a//roac) to unsnar" traTc congestionZ. 4)e defendant constructed a
*ridge a//roac) #)ic) #as a""eged to *e an infringe2ent of t)e ne#
design i""ustrated in /"ainti,Ws dra#ings. In t)is case it #as )e"d t)at
/rotection of t)e dra#ing does not eLtend to t)e unaut)ori1ed
du/"ication of t)e o*6ect dra#n *ecause co/rig)t eLtends on" to t)e
descri/tion or eL/ression of t)e o*6ect and not to t)e o*6ect itse"f. It
does not /re3ent one fro2 using t)e dra#ings to construct t)e o*6ect
/ortraed in t)e dra#ing.
In t#o ot)er cases, Imperial Homes Corp. v. Lamont, >GB !. Dd BEG
and Scholt Homes! Inc. v. Maddo", CAE !. Dd B>, it #as )e"d t)at t)ere
is no co/rig)t infringe2ent #)en one #)o, #it)out *eing aut)ori1ed,
uses a co/rig)ted arc)itectura" /"an to construct a structure. 4)is is
*ecause t)e co/rig)t does not eLtend to t)e structures t)e2se"3es.
In 5ne, #e cannot 5nd SMI "ia*"e for infringing &ear" and .eanWs
co/rig)t o3er t)e tec)nica" dra#ings of t)e "atterWs ad3ertising
dis/"a units.
4)e Su/re2e Court trenc)ant" )e"d in #aberge! Incorporated vs.
Intermediate Appellate Court t)at t)e /rotecti3e 2ant"e of t)e
4rade2ar$ 0a# eLtends on" to t)e goods used * t)e 5rst user as
s/eci5ed in t)e certi5cate of registration, fo""o#ing t)e c"ear 2andate
con3eed * Section D@ of Re/u*"ic Act <JJ, as a2ended, ot)er#ise
$no#n as t)e 4rade2ar$ 0a#, #)ic) reads:
SEC. D@. Certi$cation o% registration prima %acie evidence o% validity.-
A certi5cate of registration of a 2ar$ or trade-na2e s)a"" *e prima
%acie e3idence of t)e 3a"idit of t)e registration, t)e registrantWs
o#ners)i/ of t)e 2ar$ or trade-na2e, and of t)e registrantWs eLc"usi3e
rig)t to use t)e sa2e in connection #it) t)e goods, *usiness or
ser3ices s/eci5ed in t)e certi5cate, su*6ect to an conditions and
"i2itations stated t)erein.Z %underscoring supplied+
4)e records s)o# t)at on June D@, <EBC, &ear" and .ean a//"ied for
t)e registration of t)e trade2ar$ Z&oster AdsZ #it) t)e Bureau of
&atents, 4rade2ar$s, and 4ec)no"og 4ransfer. Said trade2ar$ #as
recorded in t)e &rinci/a" Register on Se/te2*er <D, <EBB under
Registration No. ><<JG co3ering t)e fo""o#ing /roducts: stationeries
suc) as "etter)eads, en3e"o/es and ca""ing cards and ne#s"etters.
;it) t)is as factua" *ac$dro/, #e see no "ega" *asis to t)e 5nding of
"ia*i"it on t)e /art of t)e defendants-a//e""ants for t)eir use of t)e
#ords Z&oster AdsZ, in t)e ad3ertising dis/"a units in suit.
Juris/rudence )as inter/reted Section D@ of t)e 4rade2ar$ 0a# as Zan
i2/"icit /er2ission to a 2anufacturer to 3enture into t)e /roduction of
goods and a""o# t)at /roducer to a//ro/riate t)e *rand na2e of t)e
senior registrant on goods ot)er t)an t)ose stated in t)e certi5cate of
registration.Z 4)e Su/re2e Court furt)er e2/)asi1ed t)e restricti3e
2eaning of Section D@ #)en it stated, t)roug) Justice Conrado [.
Sanc)e1, t)at:
Rea"", if t)e certi5cate of registration #ere to *e dee2ed as inc"uding
goods not s/eci5ed t)erein, t)en a situation 2a arise #)ere* an
a//"icant 2a *e te2/ted to register a trade2ar$ on an and a""
goods #)ic) )is 2ind 2a concei3e e3en if )e )ad ne3er intended to
use t)e trade2ar$ for t)e said goods. ;e *e"ie3e t)at suc) o2ni*us
registration is not conte2/"ated * our 4rade2ar$ 0a#.
;)i"e #e do not discount t)e stri$ing si2i"arit *et#een &ear" and
.eanWs registered trade2ar$ and defendants-a//e""antsW Z&oster AdsZ
design, as #e"" as t)e /ara""e" use * #)ic) said #ords #ere used in
t)e /artiesW res/ecti3e ad3ertising co/ies, #e cannot 5nd defendants-
a//e""ants "ia*"e for infringe2ent of trade2ar$. Z&oster AdsZ #as
registered * &ear" and .ean for s/eci5c use in its stationeries, in
contrast to defendants-a//e""ants #)o used t)e sa2e #ords in t)eir
ad3ertising dis/"a units. ;) &ear" and .ean "i2ited t)e use of its
trade2ar$ to stationeries is si2/" *eond us. But, )a3ing a"read
done so, it 2ust stand * t)e conseIuence of t)e registration #)ic) it
)ad caused.
;e are constrained to ado/t t)e 3ie# of defendants-a//e""ants t)at
t)e #ords Z&oster AdsZ are a si2/"e contraction of t)e generic ter2
/oster ad3ertising. In t)e a*sence of an con3incing /roof t)at Z&oster
&age . of /*
AdsZ )as acIuired a secondar 2eaning in t)is 6urisdiction, #e 5nd
t)at &ear" and .eanWs eLc"usi3e rig)t to t)e use of Z&oster AdsZ is
"i2ited to #)at is #ritten in its certi5cate of registration, na2e",
.efendants-a//e""ants cannot t)us *e )e"d "ia*"e for infringe2ent of
t)e trade2ar$ Z&oster AdsZ.
4)ere *eing no 5nding of eit)er co/rig)t or trade2ar$ infringe2ent
on t)e /art of SMI and NEMI, t)e 2onetar a#ard granted * t)e "o#er
court to &ear" and .ean )as no "eg to stand on.
;HERE!ORE, /re2ises considered, t)e assai"ed decision is RE[ERSE.
and SE4 ASI.E, and anot)er is rendered .ISMISSINV t)e co2/"aint
and counterc"ai2s in t)e a*o3e-entit"ed case for "ac$ of 2erit.
.issatis5ed #it) t)e a*o3e decision, /etitioner & ( . 5"ed t)e instant
/etition assigning t)e fo""o#ing errors for t)e CourtWs consideration:
4HE A;AR. O! 4HE 4RIA0 CO7R4, .ES&I4E 4HE 0A44ERWS
A&&EA0S, 4HA4 SM ;AS V7I04Y O! BA. !AI4H IN I4S
In reso"3ing t)is 3er interesting case, #e are c)a""enged once again
to /ut into /ro/er /ers/ecti3e four 2ain concerns of inte""ectua"
/ro/ert "a# ^ /atents, co/rig)ts, trade2ar$s and unfair
co2/etition arising fro2 infringe2ent of an of t)e 5rst t)ree. ;e
s)a"" focus t)en on t)e fo""o#ing issues:
%<+ if t)e engineering or tec)nica" dra#ings of an ad3ertising
dis/"a unit %"ig)t *oL+ are granted co/rig)t /rotection
%co/rig)t certi5cate of registration+ * t)e Nationa" 0i*rar, is
t)e "ig)t *oL de/icted in suc) engineering dra#ings i/so facto
a"so /rotected * suc) co/rig)t_
%D+ or s)ou"d t)e "ig)t *oL *e registered se/arate" and
/rotected * a /atent issued * t)e Bureau of &atents
4rade2ar$s and 4ec)no"og 4ransfer %no# Inte""ectua" &ro/ert
OTce+ ^ in addition to t)e co/rig)t of t)e engineering
%C+ can t)e o#ner of a registered trade2ar$ "ega"" /re3ent
ot)ers fro2 using suc) trade2ar$ if it is a 2ere a**re3iation
of a ter2 descri/ti3e of )is goods, ser3ices or *usiness_
&etitioner & ( .Ws co2/"aint #as t)at SMI infringed on its co/rig)t
o3er t)e "ig)t *oLes #)en SMI )ad t)e units 2anufactured * Metro
and EY. Rain*o# Ad3ertising for its o#n account. O*3ious",
/etitionerWs /osition #as /re2ised on its *e"ief t)at its co/rig)t o3er
t)e engineering dra#ings eLtended ipso %acto to t)e "ig)t *oLes
de/icted or i""ustrated in said dra#ings. In ru"ing t)at t)ere #as no
co/rig)t infringe2ent, t)e Court of A//ea"s )e"d t)at t)e co/rig)t
#as "i2ited to t)e dra#ings a"one and not to t)e "ig)t *oL itse"f. ;e
agree #it) t)e a//e""ate court.
!irst, /etitionerWs a//"ication for a co/rig)t certi5cate ^ as #e"" as
Co/rig)t Certi5cate No. &.-RDGBB issued * t)e Nationa" 0i*rar on
Januar D@, <EB< ^ c"ear" stated t)at it #as for a c"ass ZOZ #or$
under Section D %O+ of &. >E %4)e Inte""ectua" &ro/ert .ecree+ #)ic)
#as t)e statute t)en /re3ai"ing. Said Section D eL/ress" enu2erated
t)e #or$s su*6ect to co/rig)t:
SEC. D. 4)e rig)ts granted * t)is .ecree s)a"", fro2 t)e 2o2ent of
creation, su*sist #it) res/ect to an of t)e fo""o#ing #or$s:
&age *5 of /*
%O+ &rints, /ictoria" i""ustrations, ad3ertising co/ies, "a*e"s, tags, and
*oL #ra/sK
A"t)oug) /etitionerWs co/rig)t certi5cate #as entit"ed ZAd3ertising
.is/"a 7nitsZ %#)ic) de/icted t)e *oL-t/e e"ectrica" de3ices+, its
c"ai2 of co/rig)t infringe2ent cannot *e sustained.
Co/rig)t, in t)e strict sense of t)e ter2, is /ure" a statutor rig)t.
Being a 2ere statutor grant, t)e rig)ts are "i2ited to #)at t)e statute
confers. It 2a *e o*tained and en6oed on" #it) res/ect to t)e
su*6ects and * t)e /ersons, and on ter2s and conditions s/eci5ed in
t)e statute.
Accordingly! it can cover only the &orks %alling &ithin the
statutory enumeration or description.
& ( . secured its co/rig)t under t)e c"assi5cation class '('
&ork. 4)is *eing so, /etitionerWs co/rig)t /rotection eLtended on" to
t)e tec)nica" dra#ings and not to t)e "ig)t *oL itse"f *ecause t)e "atter
#as not at a"" in t)e categor of Z/rints, /ictoria" i""ustrations,
ad3ertising co/ies, "a*e"s, tags and *oL #ra/s.Z Stated ot)er#ise,
e3en as #e 5nd t)at & ( . indeed o#ned a 3a"id co/rig)t, t)e sa2e
cou"d )a3e referred on" to t)e tec)nica" dra#ings #it)in t)e categor
of Z/ictoria" i""ustrations.Z It cou"d not )a3e /ossi*" stretc)ed out to
inc"ude t)e under"ing "ig)t *oL. 4)e strict a//"ication
of t)e "a#Ws
enu2eration in Section D /re3ents us fro2 gi3ing /etitioner e3en a
"itt"e "ee#a, t)at is, e3en if its co/rig)t certi5cate #as entit"ed
ZAd3ertising .is/"a 7nits.Z ;)at t)e "a# does not inc"ude, it eLc"udes,
and for t)e good reason: t)e "ig)t *oL #as not a "iterar or artistic
/iece #)ic) cou"d *e co/rig)ted under t)e co/rig)t "a#. And no "ess
c"ear", neit)er cou"d t)e "ac$ of statutor aut)orit to 2a$e t)e "ig)t
*oL co/rig)ta*"e *e re2edied * t)e si2/"istic act of entit"ing t)e
co/rig)t certi5cate issued * t)e Nationa" 0i*rar as ZAd3ertising
.is/"a 7nits.Z
In 5ne, if SMI and NEMI re/rinted & ( .Ws tec)nica" dra#ings for sa"e to
t)e /u*"ic #it)out "icense fro2 & ( ., t)en no dou*t t)e #ou"d )a3e
*een gui"t of co/rig)t infringe2ent. But t)is #as not t)e case. SMIWs
and NEMIWs acts co2/"ained of * & ( . #ere to )a3e units si2i"ar or
identica" to t)e "ig)t *oL i""ustrated in t)e tec)nica" dra#ings
2anufactured * Metro and EY. Rain*o# Ad3ertising, for "easing out
to di,erent ad3ertisers. ;as t)is an infringe2ent of /etitionerWs
co/rig)t o3er t)e tec)nica" dra#ings_ ;e do not t)in$ so.
.uring t)e tria", t)e /resident of & ( . )i2se"f ad2itted t)at t)e "ig)t
*oL #as neit)er a "iterar not an artistic #or$ *ut an Zengineering or
2ar$eting in3ention.Z
O*3ious", t)ere a//eared to *e so2e
confusion regarding #)at oug)t or oug)t not to *e t)e /ro/er su*6ects
of co/rig)ts, /atents and trade2ar$s. In t)e "eading case of ')o 3s.
Court of A//ea"s,
#e ru"ed t)at t)ese t)ree "ega" rig)ts are
co2/"ete" distinct and se/arate fro2 one anot)er, and t)e /rotection
a,orded * one cannot *e used interc)angea*" to co3er ite2s or
#or$s t)at eLc"usi3e" /ertain to t)e ot)ers:
4rade2ar$, co/rig)t and /atents are di,erent inte""ectua" /ro/ert
rig)ts t)at cannot *e interc)anged #it) one anot)er. A trademark is
any visible sign capable o% distinguishing the goods )trademark* or
services )service mark* o% an enterprise and shall include a stamped
or marked container o% goods. In re"ation t)ereto, a trade na2e 2eans
t)e na2e or designation identifing or distinguis)ing an enter/rise.
Mean#)i"e, the scope o% a copyright is con$ned to literary and artistic
&orks #)ic) are origina" inte""ectua" creations in t)e "iterar and
artistic do2ain /rotected fro2 t)e 2o2ent of t)eir
creation. +atentable inventions! on the other hand! re%er to any
technical solution o% a problem in any $eld o% human activity #)ic) is
ne#, in3o"3es an in3enti3e ste/ and is industria"" a//"ica*"e.
4)is *rings us to t)e neLt /oint: if, des/ite its 2anufacture and
co22ercia" use of t)e light bo"es #it)out "icense fro2 /etitioner,
/ri3ate res/ondents cannot *e )e"d "ega"" "ia*"e for infringe2ent of &
( .Ws co/rig)t o3er itstechnical dra&ings o% the said light bo"es,
s)ou"d t)e *e "ia*"e instead for infringe2ent of /atent_ ;e do not
t)in$ so eit)er.
!or so2e reason or anot)er, /etitioner ne3er secured a /atent for t)e
"ig)t *oLes. It t)erefore acIuired no /atent rig)ts #)ic) cou"d )a3e
/rotected its in3ention, if in fact it rea"" #as. And *ecause it )ad no
/atent, /etitioner cou"d not "ega"" /re3ent anone fro2
2anufacturing or co22ercia"" using t)e contra/tion. In Creser
&recision Sste2s, Inc. 3s. Court of A//ea"s,
#e )e"d t)at Zt)ere can
*e no infringe2ent of a /atent unti" a /atent )as *een issued, since
#)ate3er rig)t one )as to t)e in3ention co3ered * t)e /atent arises
a"one fro2 t)e grant of /atent. L L L %A+n in3entor )as no co22on "a#
rig)t to a 2ono/o" of )is in3ention. He )as t)e rig)t to 2a$e use of
and 3end )is in3ention, *ut if )e 3o"untari" disc"oses it, suc) as *
o,ering it for sa"e, t)e #or"d is free to co/ and use it #it) i2/unit. A
/atent, )o#e3er, gi3es t)e in3entor t)e rig)t to eLc"ude a"" ot)ers. As
a /atentee, )e )as t)e eLc"usi3e rig)t of 2a$ing, se""ing or using t)e
On t)e assu2/tion t)at /etitionerWs ad3ertising units #ere
/atenta*"e in3entions, /etitioner re3ea"ed t)e2 fu"" to t)e /u*"ic *
su*2itting t)e engineering dra#ings t)ereof to t)e Nationa" 0i*rar.
&age ** of /*
4o *e a*"e to e,ecti3e" and "ega"" /rec"ude ot)ers fro2 co/ing and
/ro5ting fro2 t)e in3ention, a /atent is a /ri2ordia" reIuire2ent. No
/atent, no /rotection. 4)e u"ti2ate goa" of a /atent sste2 is to *ring
ne# designs and tec)no"ogies into t)e /u*"ic do2ain t)roug)
Ideas, once disc"osed to t)e /u*"ic #it)out t)e /rotection
of a 3a"id /atent, are su*6ect to a//ro/riation #it)out signi5cant
On one side of t)e coin is t)e /u*"ic #)ic) #i"" *ene5t fro2 ne# ideasK
on t)e ot)er are t)e in3entors #)o 2ust *e /rotected. As )e"d
in Bauer , Cie vs. (-.onnel,
Z4)e act secured to t)e in3entor t)e
eLc"usi3e rig)t to 2a$e use, and 3end t)e t)ing /atented, and
conseIuent" to /re3ent ot)ers fro2 eLercising "i$e /ri3i"eges #it)out
t)e consent of t)e /atentee. It #as /assed for t)e /ur/ose of
encouraging usefu" in3ention and /ro2oting ne# and usefu" in3entions
* t)e /rotection and sti2u"ation gi3en to in3enti3e genius, and #as
intended to secure to t)e /u*"ic, after t)e "a/se of t)e eLc"usi3e
/ri3i"eges granted t)e *ene5t of suc) in3entions and i2/ro3e2ents.Z
4)e "a# atte2/ts to stri$e an idea" *a"ance *et#een t)e t#o interests:
Z%4)e /+atent sste2 t)us e2*odies a carefu"" crafted *argain for
encouraging t)e creation and disc"osure of ne# usefu" and non-
o*3ious ad3ances in tec)no"og and design, in return for t)e eLc"usi3e
rig)t to /ractice t)e in3ention for a nu2*er of ears. 4)e in3entor 2a
$ee/ )is in3ention secret and rea/ its fruits inde5nite". In
consideration of its disc"osure and t)e conseIuent *ene5t to t)e
co22unit, t)e /atent is granted. An eLc"usi3e en6o2ent is
guaranteed )i2 for <A ears, *ut u/on t)e eL/iration of t)at /eriod,
t)e $no#"edge of t)e in3ention inures to t)e /eo/"e, #)o are t)us
ena*"ed to /ractice it and /ro5t * its use.Z
4)e /atent "a# )as a t)ree-fo"d /ur/ose: Z5rst, /atent "a# see$s to
foster and re#ard in3entionK second, it /ro2otes disc"osures of
in3entions to sti2u"ate furt)er inno3ation and to /er2it t)e /u*"ic to
/ractice t)e in3ention once t)e /atent eL/iresK t)ird, t)e stringent
reIuire2ents for /atent /rotection see$ to ensure t)at ideas in t)e
/u*"ic do2ain re2ain t)ere for t)e free use of t)e /u*"ic.Z
It is on" after an eL)austi3e eLa2ination * t)e /atent oTce t)at a
/atent is issued. Suc) an in-de/t) in3estigation is reIuired *ecause Zin
re#arding a usefu" in3ention, t)e rig)ts and #e"fare of t)e co22unit
2ust *e fair" dea"t #it) and e,ecti3e" guarded. 4o t)at end, t)e
/rereIuisites to o*taining a /atent are strict" o*ser3ed and #)en a
/atent is issued, t)e "i2itations on its eLercise are eIua"" strict"
enforced. 4o *egin #it), a genuine in3ention or disco3er 2ust *e
de2onstrated "est in t)e constant de2and for ne# a//"iances, t)e
)ea3 )and of tri*ute *e "aid on eac) s"ig)t tec)no"ogica" ad3ance in
4)ere is no suc) scrutin in t)e case of co/rig)ts nor an notice
/u*"is)ed *efore its grant to t)e e,ect t)at a /erson is c"ai2ing t)e
creation of a #or$. 4)e "a# confers t)e co/rig)t fro2 t)e 2o2ent of
and t)e co/rig)t certi5cate is issued u/on registration #it)
t)e Nationa" 0i*rar of a s#orn eL-/arte c"ai2 of creation.
4)erefore, not )a3ing gone t)roug) t)e arduous eLa2ination for
/atents, t)e /etitioner cannot eLc"ude ot)ers fro2 t)e 2anufacture,
sa"e or co22ercia" use of t)e "ig)t *oLes on t)e so"e *asis of its
co/rig)t certi5cate o3er t)e tec)nica" dra#ings.
Stated ot)er#ise, #)at /etitioner see$s is eLc"usi3it #it)out an
o//ortunit for t)e /atent oTce %I&O+ to scrutini1e t)e "ig)t *oLWs
e"igi*i"it as a /atenta*"e in3ention. 4)e iron )ere is t)at, )ad
/etitioner secured a /atent instead, its eLc"usi3it #ou"d )a3e *een for
<A ears on". But t)roug) t)e si2/"i5ed /rocedure of co/rig)t-
registration #it) t)e Nationa" 0i*rar ^ #it)out undergoing t)e rigor
of defending t)e /atenta*i"it of its in3ention *efore t)e I&O and t)e
/u*"ic ^ t)e /etitioner #ou"d *e /rotected for G@ ears. 4)is situation
cou"d not )a3e *een t)e intention of t)e "a#.
In t)e oft-cited case of Ba$er 3s. Se"den
, t)e 7nited States Su/re2e
Court )e"d t)at only the e"pression o% an idea is protected by
copyright! not the idea itsel%. In t)at case, t)e /"ainti, )e"d t)e
co/rig)t of a *oo$ #)ic) eL/ounded on a ne# accounting sste2 )e
)ad de3e"o/ed. 4)e /u*"ication i""ustrated *"an$ for2s of "edgers
uti"i1ed in suc) a sste2. 4)e defendant re/roduced for2s si2i"ar to
t)ose i""ustrated in t)e /"ainti,Ws co/rig)ted *oo$. 4)e 7S Su/re2e
Court ru"ed t)at:
Z4)ere is no dou*t t)at a #or$ on t)e su*6ect of *oo$-$ee/ing, t)oug)
on" eL/"anator of #e"" $no#n sste2s, 2a *e t)e su*6ect of a
co/rig)tK *ut, t)en, it is c"ai2ed on" as a *oo$. L L L. But t)ere is a
c"ear distinction *et#een t)e *oo$s, as suc), and t)e art, #)ic) it is,
intended to i""ustrate. 4)e 2ere state2ent of t)e /ro/osition is so
e3ident t)at it reIuires )ard" an argu2ent to su//ort it. 4)e sa2e
distinction 2a *e /redicated of e3er ot)er art as #e"" as t)at of
*oo$$ee/ing. A treatise on t)e co2/osition and use of 2edicines, *e
t)e o"d or ne#K on t)e construction and use of /"oug)s or #atc)es or
c)urnsK or on t)e 2iLture and a//"ication of co"ors for /ainting or
deingK or on t)e 2ode of dra#ing "ines to /roduce t)e e,ect of
/ers/ecti3e, #ou"d *e t)e su*6ect of co/rig)tK *ut no one #ou"d
contend t)at t)e co/rig)t of t)e treatise #ou"d gi3e t)e eLc"usi3e
rig)t to t)e art or 2anufacture descri*ed t)erein. 4)e co/rig)t of t)e
&age *0 of /*
*oo$, if not /irated fro2 ot)er #or$s, #ou"d *e 3a"id #it)out regard to
t)e no3e"t or #ant of no3e"t of its su*6ect 2atter. 4)e no3e"t of t)e
art or t)ing descri*ed or eL/"ained )as not)ing to do #it) t)e 3a"idit
of t)e co/rig)t. To 3i!e to t"e aut"or of t"e 'oo- an e=clusi!e
propert( in t"e art descri'ed t"erein, >"en no e=amination of
its no!elt( "as e!er 'een o?ciall( made, >ould 'e a surprise
and a fraud upon t"e pu'lic. T"at is t"e pro!ince of letters
patent, not of cop(ri3"t. T"e claim to an in!ention of
disco!er( of an art or manufacture must 'e su'@ected to t"e
e=amination of t"e Patent O?ce 'efore an e=clusi!e ri3"t
t"erein can 'e o'tainedA and a patent from t"e 3o!ernment
can onl( secure it.
4)e di,erence *et#een t)e t#o t)ings, "etters /atent and co/rig)t,
2a *e i""ustrated * reference to t)e su*6ects 6ust enu2erated. 4a$e
t)e case of 2edicines. Certain 2iLtures are found to *e of great 3a"ue
in t)e )ea"ing art. If t"e disco!erer >rites and pu'lis"es a 'oo-
on t"e su'@ect 8as re3ular p"(sicians 3enerall( do:, "e 3ains
no e=clusi!e ri3"t to t"e manufacture and sale of t"e
medicineA "e 3i!es t"at to t"e pu'lic. If "e desires to acBuire
suc" e=clusi!e ri3"t, "e must o'tain a patent for t"e mi=ture
as a ne> art, manufacture or composition of matter. 9e ma(
cop(ri3"t "is 'oo-, if "e pleasesA 'ut t"at onl( secures to "im
t"e e=clusi!e ri3"t of printin3 and pu'lis"in3 "is 'oo-. So of
all ot"er in!entions or disco!eries.
4)e co/rig)t of a *oo$ on /ers/ecti3e, no 2atter )o# 2an dra#ings
and i""ustrations it 2a contain, gi3es no eLc"usi3e rig)t to t)e 2odes
of dra#ing descri*ed, t)oug) t)e 2a ne3er )a3e *een $no#n or
used *efore. B /u*"is)ing t)e *oo$ #it)out getting a /atent for t)e
art, t)e "atter is gi3en to t)e /u*"ic.
No#, #)i"st no one )as a rig)t to /rint or /u*"is) )is *oo$, or an
2ateria" /art t)ereof, as a *oo$ intended to con3e instruction in t)e
art, an /erson 2a /ractice and use t)e art itse"f #)ic) )e )as
descri*ed and i""ustrated t)erein. T"e use of t"e art is a totall(
diferent t"in3 from a pu'lication of t"e 'oo- e=plainin3 it. 4)e
co/rig)t of a *oo$ on *oo$$ee/ing cannot secure t)e eLc"usi3e rig)t
to 2a$e, se"" and use account *oo$s /re/ared u/on t)e /"an set fort)
in suc) *oo$. ;)et)er t)e art 2ig)t or 2ig)t not )a3e *een /atented,
is a Iuestion, #)ic) is not *efore us. It #as not /atented, and is o/en
and free to t)e use of t)e /u*"ic. And, of course, in using t)e art, t)e
ru"ed "ines and )eadings of accounts 2ust necessari" *e used as
incident to it.
4)e /"ausi*i"it of t)e c"ai2 /ut for#ard * t)e co2/"ainant in t)is
case arises fro2 a confusion of ideas /roduced * t)e /ecu"iar nature
of t)e art descri*ed in t)e *oo$s, #)ic) )a3e *een 2ade t)e su*6ect
of co/rig)t. In descri*ing t)e art, t)e i""ustrations and diagra2s
e2/"oed )a//ened to corres/ond 2ore c"ose" t)an usua" #it) t)e
actua" #or$ /erfor2ed * t)e o/erator #)o uses t)e art. L L L T"e
description of t"e art in a 'oo-, t"ou3" entitled to t"e 'eneCt
of cop(ri3"t, la(s no foundation for an e=clusi!e claim to t"e
art itself. T"e o'@ect of t"e one is e=planationA t"e o'@ect of
t"e ot"er is use. T"e former ma( 'e secured '( cop(ri3"t. T"e
latter can onl( 'e secured, if it can 'e secured at all, '( letters
patent.D %underscoring su//"ied+
4)is issue concerns t)e use * res/ondents of t)e 2ar$ Z&oster AdsZ
#)ic) /etitionerWs /resident said #as a contraction of Z/oster
ad3ertising.Z & ( . #as a*"e to secure a trade2ar$ certi5cate for it,
*ut one #)ere t)e goods s/eci5ed #ere Zstationeries suc) as
"etter)eads, en3e"o/es, ca""ing cards and ne#s"etters.Z
ad2itted it did not co22ercia"" engage in or 2ar$et t)ese goods. On
t)e contrar, it dea"t in e"ectrica"" o/erated *ac$"it ad3ertising units
and t)e sa"e of ad3ertising s/aces t)ereon, #)ic), )o#e3er, #ere not
at a"" s/eci5ed in t)e trade2ar$ certi5cate.
7nder t)e circu2stances, t)e Court of A//ea"s correct" cited #aberge
Inc. vs. Intermediate Appellate Court,
#)ere #e, in3o$ing Section D@
of t)e o"d 4rade2ar$ 0a#, ru"ed t)at Zt)e certi5cate of registration
issued * t)e .irector of &atents can confer %u/on /etitioner+ t)e
eLc"usi3e rig)t to use its o#n s2*o" only to those goods speci$ed in
the certi$cate, su*6ect to an conditions and "i2itations s/eci5ed in
t)e certi5cate L L L. One #)o )as ado/ted and used a trade2ar$ on
)is goods does not prevent the adoption and use o% the same
trademark by others %or products &hich are o% a
di/erent description.Z
#aberge! Inc. #as correct and #as in fact
recent" reiterated in Canon 0abushiki 0aisha vs. Court o% Appeals.
Assu2ing arguendo t)at Z&oster AdsZ cou"d 3a"id" Iua"if as a
trade2ar$, t)e fai"ure of & ( . to secure a trade2ar$ registration for
s/eci5c use on t)e "ig)t *oLes 2eant t)at t)ere cou"d not )a3e *een
an trade2ar$ infringe2ent since registration #as an essentia"
e"e2ent t)ereof.12&phi1
&age *1 of /*
If at a"", t)e cause of action s)ou"d )a3e *een for unfair co2/etition, a
situation #)ic) #as /ossi*"e e3en if & ( . )ad no
Ho#e3er, #)i"e t)e /etitionerWs co2/"aint in t)e R4C
a"so cited unfair co2/etition, t)e tria" court did not 5nd /ri3ate
res/ondents "ia*"e t)erefor. &etitioner did not a//ea" t)is /articu"ar
/ointK )ence, it cannot no# re3i3e its c"ai2 of unfair co2/etition.
But e3en disregarding /rocedura" issues, #e ne3ert)e"ess cannot )o"d
res/ondents gui"t of unfair co2/etition.
B t)e nature of t)ings, t)ere can *e no unfair co2/etition under t)e
"a# on co/rig)ts a"t)oug) it is a//"ica*"e to dis/utes o3er t)e use of
trade2ar$s. E3en a na2e or /)rase inca/a*"e of a//ro/riation as a
trade2ar$ or tradena2e 2a, * "ong and eLc"usi3e use * a *usiness
%suc) t)at t)e na2e or /)rase *eco2es associated #it) t)e *usiness
or /roduct in t)e 2ind of t)e /urc)asing /u*"ic+, *e entit"ed to
/rotection against unfair co2/etition.
In t)is case, t)ere #as no
e3idence t)at & ( .Ws use of Z&oster AdsZ #as distincti3e or #e""-
$no#n. As noted * t)e Court of A//ea"s, /etitionerWs eL/ert #itnesses
)i2se"f )ad testi5ed t)at Z S&oster AdsW #as too generic a na2e. So it
#as diTcu"t to identif it #it) an co2/an, )onest" s/ea$ing.Z
crucia" ad2ission * its o#n eL/ert #itness t)at Z&oster AdsZ cou"d not
*e associated #it) & ( . s)o#ed t)at, in t)e 2ind of t)e /u*"ic, t)e
goods and ser3ices carring t)e trade2ar$ Z&oster AdsZ cou"d not *e
distinguis)ed fro2 t)e goods and ser3ices of ot)er entities.
4)is fact a"so /re3ented t)e a//"ication of t)e doctrine of secondar
2eaning. Z&oster AdsZ #as generic and inca/a*"e of *eing used as a
trade2ar$ *ecause it #as used in t)e 5e"d of /oster ad3ertising, t)e
3er *usiness engaged in * /etitioner. ZSecondar 2eaningZ 2eans
t)at a #ord or /)rase origina"" inca/a*"e of eLc"usi3e a//ro/riation
#it) reference to an artic"e in t)e 2ar$et %*ecause it is geogra/)ica""
or ot)er#ise descri/ti3e+ 2ig)t ne3ert)e"ess )a3e *een used for so
"ong and so eLc"usi3e" * one /roducer #it) reference to )is artic"e
t)at, in t)e trade and to t)at *ranc) of t)e /urc)asing /u*"ic, t)e #ord
or /)rase )as co2e to 2ean t)at t)e artic"e #as )is /ro/ert.
ad2ission * /etitionerWs o#n eL/ert #itness t)at )e )i2se"f cou"d not
associate Z&oster AdsZ #it) /etitioner & ( . *ecause it #as Ztoo
genericZ de5nite" /rec"uded t)e a//"ication of t)is eLce/tion.
Ha3ing discussed t)e 2ost i2/ortant and critica" issues, #e see no
need to *e"a*or t)e rest.
A"" to"d, t)e Court 5nds no re3ersi*"e error co22itted * t)e Court of
A//ea"s #)en it re3ersed t)e Regiona" 4ria" Court of Ma$ati Cit.
)9$#$EO#$, t)e /etition is )ere* .ENIE. and t)e decision of t)e
Court of A//ea"s dated Ma DD, D@@< is A!!IRME. in toto.
4.#. No. *5+./6 Januar( 0+, *...
INC., /etitioners,
$SPOSO, E$LIP$ %$INA, J#., and CAS$&
E#ANCISCO, res/ondents.

%$NOHA, J.:
4)is is a /etition for certiorari. &etitioners see$ to annu" t)e reso"ution
of t)e .e/art2ent of Justice, dated August <D, <EED, in Cri2ina" Case
No. R-ED-DABG>, entit"ed ZVa*rie" Uosa, et al. 3. Cit &rosecutor of
Rue1on Cit and !rancisco JoaIuin, Jr.,Z and its reso"ution, dated
.ece2*er C, <EED, dening /etitioner JoaIuin8s 2otion for
&etitioner BJ &roductions, Inc. %BJ&I+ is t)e )o"derYgrantee of Certi5cate
of Co/rig)t No. MEDD, dated Januar DB, <EA<, of 3hoda and Me, a
dating ga2e s)o# aired fro2 <EA@ to <EAA.
On June DB, <EAC, /etitioner BJ&I su*2itted to t)e Nationa" 0i*rar an
addendu2 to its certi5cate of co/rig)t s/ecifing t)e s)o#8s for2at
and st"e of /resentation.
On Ju" <>, <EE<, #)i"e #atc)ing te"e3ision, /etitioner !rancisco
JoaIuin, Jr., /resident of BJ&I, sa# on R&N C)anne" E an e/isode of It4s
a .ate, #)ic) #as /roduced * I]0 &roductions, Inc. %I]0+. On Ju" <B,
<EE<, )e #rote a "etter to /ri3ate res/ondent Va*rie" M. Uosa,
/resident and genera" 2anager of I]0, infor2ing Uosa t)at BJ&I )ad a
co/rig)t to 3hoda and Me and de2anding t)at I]0 discontinue
airing It4s a .ate.
In a "etter, dated Ju" <E, <EE<, /ri3ate res/ondent Uosa a/o"ogi1ed to
/etitioner JoaIuin and reIuested a 2eeting to discuss a /ossi*"e
sett"e2ent. I]0, )o#e3er, continued airing It8s a .ate, /ro2/ting
/etitioner JoaIuin to send a second "etter on Ju" DG, <EE< in #)ic) )e
&age */ of /*
reiterated )is de2and and #arned t)at, if I]0 did not co2/", )e
#ou"d endorse t)e 2atter to )is attornes for /ro/er "ega" action.
Mean#)i"e, /ri3ate res/ondent Uosa soug)t to register I]08s co/rig)t
to t)e 5rst e/isode of It8s a .ate for #)ic) it #as issued * t)e
Nationa" 0i*rar a certi5cate of co/rig)t August <>, <EE<.
7/on co2/"aint of /etitioners, an infor2ation for 3io"ation of &... No.
>E #as 5"ed against /ri3ate res/ondent Uosa toget)er #it) certain
oTcers of R&N C)anne" E, na2e", ;i""ia2 Es/oso, !e"i/e Medina, and
Case !rancisco, in t)e Regiona" 4ria" Court of Rue1on Cit #)ere it
#as doc$eted as Cri2ina" Case No. ED-DABG> and assigned to Branc)
<@> t)ereof. Ho#e3er, /ri3ate res/ondent Uosa soug)t a re3ie# of t)e
reso"ution of t)e Assistant Cit &rosecutor *efore t)e .e/art2ent of
On August <D, <EED, res/ondent Secretar of Justice !ran$"in M. .ri"on
re3ersed t)e Assistant Cit &rosecutor8s 5ndings and directed )i2 to
2o3e for t)e dis2issa" of t)e case against /ri3ate res/ondents.
&etitioner JoaIuin 5"ed a 2otion for reconsideration, *ut )is 2otion
denied * res/ondent Secretar of Justice on .ece2*er C, <EED.
Hence, t)is /etition. &etitioners contend t)at:
<. 4)e /u*"ic res/ondent gra3e"
a*used )is discretion a2ounting to
"ac$ of 6urisdiction ^ #)en )e in3o$ed
non-/resentation of t)e 2aster ta/e as
*eing fata" to t)e eListence of
/ro*a*"e cause to /ro3e infringe2ent,
des/ite t)e fact t)at /ri3ate
res/ondents ne3er raised t)e sa2e as
a contro3erted issue.
D. 4)e /u*"ic res/ondent gra3e"
a*used )is discretion a2ounting to
"ac$ of 6urisdiction #)en )e arrogated
unto )i2se"f t)e deter2ination of #)at
is co/rig)ta*"e ^ an issue #)ic) is
eLc"usi3e" #it)in t)e 6urisdiction of
t)e regiona" tria" court to assess in a
/ro/er /roceeding.
Bot) /u*"ic and /ri3ate res/ondents 2aintain t)at /etitioners fai"ed to
esta*"is) t)e eListence of /ro*a*"e cause due to t)eir fai"ure to
/resent t)e co/rig)ted 2aster 3ideota/e of 3hoda and Me. 4)e
contend t)at /etitioner BJ&I8s co/rig)t co3ers on" a s/eci5c e/isode
of 3hoda and Me and t)at t)e for2ats or conce/ts of dating ga2e
s)o#s are not co3ered * co/rig)t /rotection under &... No. >E.
Non-Assign2ent of Error.
&etitioners c"ai2 t)at t)eir fai"ure to su*2it t)e co/rig)ted 2aster
3ideota/e of t)e te"e3ision s)o# R)oda and Me #as not raised in issue
* /ri3ate res/ondents during t)e /re"i2inar in3estigation and,
t)erefore, it #as error for t)e Secretar of Justice to re3erse t)e
in3estigating /rosecutor8s 5nding of /ro*a*"e cause on t)is ground.
A /re"i2inar in3estigation fa""s under t)e aut)orit of t)e state
/rosecutor #)o is gi3en * "a# t)e /o#er to direct and contro" cri2ina"
He is, )o#e3er, su*6ect to t)e contro" of t)e Secretar of
Justice. 4)us, Ru"e <<D, H> of t)e Re3ised Ru"es of Cri2ina" &rocedure,
Sec. >. .uty o% investigating $scal. ^ If t)e
in3estigating 5sca" 5nds cause to )o"d t)e res/ondent
for tria", )e s)a"" /re/are t)e reso"ution and
corres/onding infor2ation. He s)a"" certif under oat)
t)at )e, or as s)o#n * t)e record, an aut)ori1ed
oTcer, )as /ersona"" eLa2ined t)e co2/"ainant and
)is #itnesses, t)at t)ere is reasona*"e ground to
*e"ie3e t)at a cri2e )as *een co22itted and t)at t)e
accused is /ro*a*" gui"t t)ereof, t)at t)e accused
#as infor2ed of t)e co2/"aint and of t)e e3idence
su*2itted against )i2 and t)at )e #as gi3en an
o//ortunit to su*2it contro3erting e3idence.
Ot)er#ise, )e s)a"" reco22end dis2issa" of t)e
In eit)er case, )e s)a"" for#ard t)e records of t)e case
to t)e /ro3incia" or cit 5sca" or c)ief state /rosecutor
#it)in 53e %G+ das fro2 )is reso"ution. 4)e "atter s)a""
ta$e a//ro/riate action t)ereon ten %<@+ das fro2
recei/t t)ereof, i22ediate" infor2ing t)e /arties of
said action.
No co2/"aint or infor2ation 2a *e 5"ed or dis2issed
* an in3estigating 5sca" #it)out t)e /rior #ritten
aut)orit or a//ro3a" of t)e /ro3incia" or cit 5sca" or
c)ief state /rosecutor.
&age *, of /*
;)ere t)e in3estigating assistant 5sca" reco22ends
t)e dis2issa" of t)e case *ut )is 5ndings are re3ersed
* t)e /ro3incia" or cit 5sca" or c)ief state /rosecutor
on t)e ground t)at a /ro*a*"e cause eLists, t)e "atter
2a, * )i2se"f, 5"e t)e corres/onding infor2ation
against t)e res/ondent or direct an ot)er assistant
5sca" or state /rosecutor to do so, #it)out conducting
anot)er /re"i2inar in3estigation.
If u/on /etition * a /ro/er /art, t)e Secretar of
Justice re3erses t)e reso"ution of t)e /ro3incia" or cit
5sca" or c)ief state /rosecutor, )e s)a"" direct t)e
5sca" concerned to 5"e t)e corres/onding infor2ation
#it)out conducting anot)er /re"i2inar in3estigation
or to dis2iss or 2o3e for dis2issa" of t)e co2/"aint or
In re3ie#ing reso"utions of /rosecutors, t)e Secretar of Justice is not
/rec"uded fro2 considering errors, a"t)oug) unassigned, for t)e
/ur/ose of deter2ining #)et)er t)ere is /ro*a*"e cause for 5"ing
cases in court. He 2ust 2a$e )is o#n 5nding, of /ro*a*"e cause and is
not con5ned to t)e issues raised * t)e /arties during /re"i2inar
in3estigation. Moreo3er, )is 5ndings are not su*6ect to re3ie# un"ess
s)o#n to )a3e *een 2ade #it) gra3e a*use.
O/inion of t)e Secretar of Justice
&etitioners contend, )o#e3er, t)at t)e deter2ination of t)e Iuestion
#)et)er t)e for2at or 2ec)anics of a s)o# is entit"ed to co/rig)t
/rotection is for t)e court, and not t)e Secretar of Justice, to 2a$e.
4)e assai" t)e fo""o#ing /ortion of t)e reso"ution of t)e res/ondent
Secretar of Justice:
O4P)e essence of co/rig)t infringe2ent is t)e
co/ing, in #)o"e or in /art, of co/rig)ta*"e 2ateria"s
as de5ned and enu2erated in Section D of &.. No.
>E. Apart %rom the manner in &hich it is actually
e"pressed! ho&ever! the idea o% a dating game sho&
is! in the opinion o% this (5ce! a non6copyrightable
material. Ideas! concepts! %ormats! or schemes in their
abstract %orm clearly do not %all &ithin the class o%
&orks or materials susceptible o% copyright
registration as provided in +.. 7o. 89.
It is indeed true t)at t)e Iuestion #)et)er t)e for2at or 2ec)anics of
/etitioners te"e3ision s)o# is entit"ed to co/rig)t /rotection is a "ega"
Iuestion for t)e court to 2a$e. 4)is does not, )o#e3er, /rec"ude
res/ondent Secretar of Justice fro2 2a$ing a /re"i2inar
deter2ination of t)is Iuestion in reso"3ing #)et)er t)ere is /ro*a*"e
cause for 5"ing t)e case in court. In doing so in t)is case, )e did not
co22it an gra3e error.
&resentation of Master 4a/e
&etitioners c"ai2 t)at res/ondent Secretar of Justice gra3e" a*used
)is discretion in ru"ing t)at t)e 2aster 3ideota/e s)ou"d )a3e *een
/redented in order to deter2ine #)et)er t)ere #as /ro*a*"e cause for
co/rig)t infringe2ent. 4)e contend t)at :;th Century #o" #ilm
Corporation v. Court o% Appeals,
on #)ic) res/ondent Secretar of
Justice re"ied in re3ersing t)e reso"ution of t)e in3estigating
/rosecutor, is ina//"ica*"e to t)e case at *ar *ecause in t)e /resent
case, t)e /arties /resented suTcient e3idence #)ic) c"ear" esta*"is)
Z"in$age *et#een t)e co/rig)t s)o# ZR)oda and MeZ and t)e
infringing 4[ s)o# ZIt8s a .ate.Z
4)e case of D@t) Centur !oL !i"2 Cor/oration in3o"3ed raids
conducted on 3arious 3ideota/e out"ets a""eged"" se""ing or renting
out Z/iratedZ 3ideota/es. 4)e tria" court found t)at t)e aTda3its of
NBI agents, gi3en in su//ort of t)e a//"ication for t)e searc) #arrant,
#ere insuTcient #it)out t)e 2aster ta/e. According", t)e tria" court
"ifted t)e searc) #arrants it )ad /re3ious" issued against t)e
defendants. On /etition for re3ie#, t)is Court sustained t)e action of
t)e tria" court and ru"ed:
4)e /resentation of t)e 2aster ta/es of t)e
co/rig)ted 5"2s fro2 #)ic) t)e /irated 5"2s #ere
a""eged" co/ied, #as necessar for t)e 3a"idit of
searc) #arrants against t)ose #)o )a3e in t)eir
/ossession t)e /irated 5"2s. 4)e /etitioner8s
argu2ent to t)e e,ect t)at t)e /resentation of t)e
2aster ta/es at t)e ti2e of a//"ication 2a not *e
necessar as t)ese #ou"d *e 2ere" e3identiar in
nature and not deter2inati3e of #)et)er or not a
/ro*a*"e cause eLists to 6ustif t)e issuance of t)e
searc) #arrants is not 2eritorious. 4)e court cannot
/resu2e t)at du/"icate or co/ied ta/es #ere
necessari" re/roduced fro2 2aster ta/es t)at it
4)e a//"ication for searc) #arrants #as directed
against 3ideo ta/e out"ets #)ic) a""eged" #ere
&age *6 of /*
engaged in t)e unaut)ori1ed sa"e and renting out of
co/rig)ted 5"2s *e"onging to t)e /etitioner /ursuant
to &... >E.
4)e essence of a co/rig)t infringe2ent is t)e
si2i"arit or at "east su*stantia" si2i"arit of t)e
/ur/orted /irated #or$s to t)e co/rig)ted #or$.
Hence, t)e a//"icant 2ust /resent to t)e court t)e
co/rig)ted 5"2s to co2/are t)e2 #it) t)e /urc)ased
e3idence of t)e 3ideo ta/es a""eged" /irated to
deter2ine #)et)er t)e "atter is an unaut)ori1ed
re/roduction of t)e for2er. 4)is "in$age of t)e
co/rig)ted 5"2s to t)e /irated 5"2s 2ust *e
esta*"is)ed to satisf t)e reIuire2ents of /ro*a*"e
cause. Mere a""egations as to t)e eListence of t)e
co/rig)ted 5"2s cannot ser3e as *asis for t)e
issuance of a searc) #arrant.
4)is ru"ing #as Iua"i5ed in t)e "ater case of Columbia +ictures!
Inc. v. Court o% Appeals
in #)ic) it #as )e"d:
In 5ne, t)e su//osed pronunciamento in said case
regarding t)e necessit for t)e /resentation of t)e
2aster ta/es of t)e co/rig)ted 5"2s for t)e 3a"idit
of searc) #arrants s)ou"d at 2ost *e understood to
2ere" ser3e as a guide/ost in deter2ining t)e
eListence of /ro*a*"e cause in co/rig)t infringe2ent
cases &here there is doubt as to the true ne"us
bet&een the master tape and the printed copies. An
o*6ecti3e and carefu" reading of t)e decision in said
case cou"d "ead to no ot)er conc"usion t)an t)at said
directi3e #as )ard" intended to *e a s#ee/ing and
inQeLi*"e reIuire2ent in a"" or si2i"ar co/rig)t
infringe2ent cases. . .
In t)e case at *ar during t)e /re"i2inar in3estigation, /etitioners and
/ri3ate res/ondents /resented #ritten descri/tions of t)e for2ats of
t)eir res/ecti3e te"e3isions s)o#s, on t)e *asis of #)ic) t)e
in3estigating /rosecutor ru"ed:
As 2a O*eP g"eaned fro2 t)e e3idence on record, t)e
su*stance of t)e te"e3ision /roductions co2/"ainant8s
ZRHO.A AN. MEZ and Uosa8s ZI48S A .A4EZ is t)at t#o
2atc)es are 2ade *et#een a 2a"e and a fe2a"e, *ot)
sing"e, and t)e t#o cou/"es are treated to a nig)t or
t#o of dining andYor dancing at t)e eL/ense of t)e
s)o#. 4)e 2a6or conce/ts of *ot) s)o#s is t)e sa2e.
An di,erence a//ear 2ere 3ariations of t)e 2a6or
4)at t)ere is an infringe2ent on t)e co/rig)t of t)e
s)o# ZRHO.A AN. MEZ *ot) in content and in t)e
eLecution of t)e 3ideo /resentation are esta*"is)ed
*ecause res/ondent8s ZI48S A .A4EZ is /ractica"" an
eLact co/ of co2/"ainant8s ZRHO.A AN. MEZ
*ecause of su*stantia" si2i"arities as fo""o#s, to #it:
Set <
a. 7n2arried /artici/ant of one gender %searc)er+
a//ears on one side of a di3ider, #)i"e t)ree %C+
un2arried /artici/ants of t)e ot)er gender are on t)e
ot)er side of t)e di3ider. 4)is arrange2ent is done to
ensure t)at t)e searc)er does not see t)e searc)ees.
a. sa2e
*. Searc)er as$s a Iuestion to *e ans#ered * eac) of
t)e searc)ees. 4)e /ur/ose is to deter2ine #)o
a2ong t)e searc)ees is t)e 2ost co2/ati*"e #it) t)e
*. sa2e
c. Searc)er s/ecu"ates on t)e 2atc) to t)e searc)ee. c. sa2e
d. Se"ection is 2ade * t)e use of co2/ute %sic+
2et)ods, or * t)e #a Iuestions are ans#ered, or
d. Se"ection is *ased on t)e ans#er of t)e Searc)ees.
Set D
Sa2e as a*o3e #it) t)e genders of t)e searc)er and
searc)ees interc)anged.
&etitioners assert t)at t)e for2at of 3hoda and Me is a /roduct of
ingenuit and s$i"" and is t)us entit"ed to co/rig)t /rotection. It is
t)eir /osition t)at t)e /resentation of a /oint-*-/oint co2/arison of
t)e for2ats of t)e t#o s)o#s c"ear" de2onstrates t)e neLus *et#een
t)e s)o#s and )ence esta*"is)es t)e eListence of /ro*a*"e cause for
co/rig)t infringe2ent. Suc) *eing t)e case, t)e did not )a3e to
/roduce t)e 2aster ta/e.
4o *egin #it) t)e for2at of a s)o# is not co/rig)ta*"e. Section D of
&... No. >E,
ot)er#ise $no#n as t)e .ECREE ON IN4E00EC47A0
&RO&ER4Y, enu2erates t)e c"asses of #or$ entit"ed to co/rig)t
/rotection, to #it:
&age *< of /*
Sec. D. 4)e rig)ts granted * t)is .ecree s)a"", fro2
t)e 2o2ent of creation, su*sist #it) res/ect to an of
t)e fo""o#ing c"asses of #or$s:
%A+ Boo$s, inc"uding co2/osite and cc"o/edic #or$s,
2anuscri/ts, directories, and ga1etteers:
%B+ &eriodica"s, inc"uding /a2/)"ets and ne#s/a/ersK
%C+ 0ectures, ser2ons, addresses, dissertations
/re/ared for ora" de"i3erK
%.+ 0ettersK
%E+ .ra2atic or dra2atico-2usica" co2/ositionsK
c)oreogra/)ic #or$s and entertain2ents in du2*
s)o#s, t)e acting for2 of #)ic) is 5Led in #riting or
%!+ Musica" co2/ositions, #it) or #it)out #ordsK
%V+ ;or$s of dra#ing, /ainting, arc)itecture, scu"/ture,
engra3ing, "it)ogra/), and ot)er #or$s of artK 2ode"s
or designs for #or$s of artK
%H+ Re/roductions of a #or$ of artK
%I+ Origina" orna2enta" designs or 2ode"s for artic"es
of 2anufacture, #)et)er or not /atenta*"e, and ot)er
#or$s of a//"ied artK
%J+ Ma/s, /"ans, s$etc)es, and c)artsK
%'+ .ra#ings or /"astic #or$s of a scienti5c or
tec)nica" c)aracterK
%I+ &)otogra/)ic #or$s and #or$s /roduced * a
/rocess ana"ogous to /)otogra/) "antern s"idesK
%M+ Cine2atogra/)ic #or$s and #or$s /roduced * a
/rocess ana"ogous to cine2atogra/) or an /rocess
for 2a$ing audio-3isua" recordingsK
%N+ Co2/uter /rogra2sK
%O+ &rints, /ictoria" i""ustrations ad3ertising co/ies,
"a*e"s tags, and *oL #ra/sK
%&+ .ra2ati1ations, trans"ations, ada/tations,
a*ridge2ents, arrange2ents and ot)er a"terations of
"iterar, 2usica" or artistic #or$s or of #or$s of t)e
&)i"i//ine go3ern2ent as )erein de5ned, #)ic) s)a""
*e /rotected as /ro3ided in Section B of t)is .ecree.
%R+ Co""ections of "iterar, sc)o"ar", or artistic #or$s or
of #or$s referred to in Section E of t)is .ecree #)ic)
* reason of t)e se"ection and arrange2ent of t)eir
contents constitute inte""ectua" creations, t)e sa2e to
*e /rotected as suc) in accordance #it) Section B of
t)is .ecree.
%R+ Ot)er "iterar, sc)o"ar", scienti5c and artistic
4)is /ro3ision is su*stantia"" t)e sa2e as H<AD of t)e IN4E00EC47A0
4)e for2at or
2ec)anics of a te"e3ision s)o# is not inc"uded in t)e "ist of /rotected
#or$s in HD of &... No. >E. !or t)is reason, t)e /rotection a,orded *
t)e "a# cannot *e eLtended to co3er t)e2.
Co/rig)t, in t)e strict sense of t)e ter2, is /ure" a
statutor rig)t. It is a ne# or inde/endent rig)t
granted * t)e statute, and not si2/" a /re-eListing
rig)t regu"ated * t)e statute. Being a statutor grant,
t)e rig)ts are on" suc) as t)e statute confers, and
2a *e o*tained and en6oed on" #it) res/ect to t)e
su*6ects and * t)e /ersons and on ter2s and
conditions s/eci5ed in t)e statute.
Since . . . co/rig)t in /u*"is)ed #or$s is /ure" a
statutor creation, a co/rig)t 2a *e o*tained on"
for a #or$ fa""ing #it)in t)e statutor enu2eration or
Regard"ess of t)e )istorica" 3ie#/oint, it is
aut)oritati3e" sett"ed in t)e 7nited States t)at t)ere
is no co/rig)t eLce/t t)at #)ic) is *ot) created and
secured * act of Congress . . . . .
&... No. >E, HD, in enu2erating #)at are su*6ect to co/rig)t, refers to
5nis)ed #or$s and not to conce/ts. 4)e co/rig)t does not eLtend to
&age *+ of /*
an idea, /rocedure, /rocess, sste2, 2et)od of o/eration, conce/t,
/rinci/"e, or disco3er, regard"ess of t)e for2 in #)ic) it is descri*ed,
eL/"ained, i""ustrated, or e2*odied in suc) #or$.
4)us, t)e ne#
IN4E00EC47A0 &RO&ER4Y CO.E O! 4HE &HI0I&&INES /ro3ides:
Sec. <AG. <nprotected Sub=ect Matter. ^
Not#it)standing t)e /ro3isions of Sections <AD and
<AC, no /rotection s)a"" eLtend, under t)is "a#, to an
idea, /rocedure, sste2, 2et)od or o/eration,
conce/t, /rinci/"e, disco3er or 2ere data as suc),
e3en if t)e are eL/ressed, eL/"ained, i""ustrated or
e2*odied in a #or$K ne#s of t)e da and ot)er
2isce""aneous facts )a3ing t)e c)aracter of 2ere
ite2s of /ress infor2ationK or an oTcia" teLt of a
"egis"ati3e, ad2inistrati3e or "ega" nature, as #e"" as
an oTcia" trans"ation t)ereof.
;)at t)en is t)e su*6ect 2atter of /etitioners8 co/rig)t_ 4)is Court is
of t)e o/inion t)at /etitioner BJ&I8s co/rig)t co3ers audio-3isua"
recordings of eac) e/isode of 3hoda and Me, as fa""ing #it)in t)e c"ass
of #or$s 2entioned in &... >E, HD%M+, to #it:
Cine2atogra/)ic #or$s and #or$s /roduced * a
/rocess ana"ogous to cine2atogra/) or an /rocess
for 2a$ing audio-3isua" recordingsK
4)e co/rig)t does not eLtend to t)e genera" conce/t or
for2at of its dating ga2e s)o#. According", * t)e 3er
nature of t)e su*6ect of /etitioner BJ&I8s co/rig)t, t)e
in3estigating /rosecutor s)ou"d )a3e t)e o//ortunit to
co2/are t)e 3ideota/es of t)e t#o s)o#s.
Mere descri/tion * #ords of t)e genera" for2at of t)e t#o dating
ga2e s)o#s is insuTcientK t)e /resentation of t)e 2aster 3ideota/e
in e3idence #as indis/ensa*"e to t)e deter2ination of t)e eListence of
/ro*a*"e cause. As a/t" o*ser3ed * res/ondent Secretar of Justice:
A te"e3ision s)o# inc"udes 2ore t)an 2ere #ords can
descri*e *ecause it in3o"3es a #)o"e s/ectru2 of
3isua"s and e,ects, 3ideo and audio, suc) t)at no
si2i"arit or dissi2i"arit 2a *e found * 2ere"
descri*ing t)e genera" co/rig)tYfor2at of *ot) dating
ga2e s)o#s.
;HERE!ORE, t)e /etition is )ere* .ISMISSE.
4.#. No. L-16/50 %arc" *6, *.+<
PUGLIS9$#S, INC., /"ainti,-a//e""ant,
G$NJA%IN TAN, defendant-a//e""ee.
Lichauco! +icao , Agcaoili La& (5ce %or plainti/6appellant.
3amon A. 7ieves %or de%endant6appellee.

PA#AS, J.:
An a//ea" #as 2ade to t)e Court of A//ea"s doc$eted as CA-V.R. No.
>JCAC-R I entit"ed #ilipino Society o% Composers! Authors! +ublishers!
Inc.! +lainti/6Appellant v. Ben=amin Tan! .e%endant6Appellee! fro2 t)e
decision of t)e Court of !irst Instance of Mani"a, Branc) [II in Ci3i"
Case No. A<DDD II '#ilipino Society o% Composers! Authors and
+ublishers! Inc.! +lainti/ v. Ben=amin Tan! .e%endant!' #)ic) )ad
dis2issed /"ainti,s8 co2/"aint #it)out s/ecia" /ronounce2ent as to
4)e Court of A//ea"s, 5nding t)at t)e case in3o"3es /ure Iuestions of
"a#, certi5ed t)e sa2e to t)e Su/re2e Court for 5na" deter2ination
%Reso"ution, CA-V.R. No. >JCAC-R, Ro""o, /. CJK Reso"ution of t)e
Su/re2e Court of !e*ruar <J, <EAC in 0-CJ>@D, Ro""o, /. CB+.
4)e undis/uted facts of t)is case are as fo""o#s:
&"ainti,-a//e""ant is a non-/ro5t association of aut)ors, co2/osers
and /u*"is)ers du" organi1ed under t)e Cor/oration 0a# of t)e
&)i"i//ines and registered #it) t)e Securities and ELc)ange
Co22ission. Said association is t)e o#ner of certain 2usica"
co2/ositions a2ong #)ic) are t)e songs entit"ed: Z.a)i" Sa IoZ,
ZSa/ag$at I$a# A A$in,Z ZSa/ag$at 'a2i A 4ao 0a2angZ and Z4)e
Nearness Of You.Z
&age *. of /*
On t)e ot)er )and, defendant-a//e""ee is t)e o/erator of a restaurant
$no#n as ZA"eL Soda !oundation and RestaurantZ #)ere a co2*o #it)
/rofessiona" singers, )ired to /"a and sing 2usica" co2/ositions to
entertain and a2use custo2ers t)erein, #ere /"aing and singing t)e
a*o3e-2entioned co2/ositions #it)out an "icense or /er2ission fro2
t)e a//e""ant to /"a or sing t)e sa2e. According", a//e""ant
de2anded fro2 t)e a//e""ee /a2ent of t)e necessar "icense fee for
t)e /"aing and singing of aforesaid co2/ositions *ut t)e de2and #as
Hence, on No3e2*er A, <EJA, a//e""ant 5"ed a co2/"aint #it) t)e
"o#er court for infringe2ent of co/rig)t against defendant-a//e""ee
for a""o#ing t)e /"aing in defendant-a//e""ee8s restaurant of said
songs co/rig)ted in t)e na2e of t)e for2er.
.efendant-a//e""ee, in )is ans#er, countered t)at t)e co2/"aint
states no cause of action. ;)i"e not dening t)e /"aing of said
co/rig)ted co2/ositions in )is esta*"is)2ent, a//e""ee 2aintains
t)at t)e 2ere singing and /"aing of songs and /o/u"ar tunes e3en if
t)e are co/rig)ted do not constitute an infringe2ent %Record on
A//ea", /. <<K Reso"ution, CA-V.R. NO. >JCAC-R, Ro""o, //. CD-CJ+
under t)e /ro3isions of Section C of t)e Co/rig)t 0a# %Act C<C> of t)e
&)i"i//ine 0egis"ature+.
4)e "o#er court, 5nding for t)e defendant, dis2issed t)e co2/"aint
%Record on A//ea", /. DG+.
&"ainti, a//ea"ed to t)e Court of A//ea"s #)ic) as a"read stated
certi5ed t)e case to t)e Su/re2e Court for ad6udication on t)e "ega"
Iuestion in3o"3ed. %Reso"ution, Court of A//ea"s, Ro""o, /. CJK
Reso"ution of t)e Su/re2e Court of !e*ruar <B, <EAC, Ro""o, /. CB+.
In its *rief in t)e Court of A//ea"s, a//e""ant raised t)e fo""o#ing
Assign2ent of Errors:
%Brief for A//e""ant, //. A and B+.
4)e /etition is de3oid of 2erit.
4)e /rinci/a" issues in t)is case are #)et)er or not t)e /"aing and
signing of 2usica" co2/ositions #)ic) )a3e *een co/rig)ted under
t)e /ro3isions of t)e Co/rig)t 0a# %Act C<C>+ inside t)e
esta*"is)2ent of t)e defendant-a//e""ee constitute a /u*"ic
/erfor2ance for /ro5t #it)in t)e 2eaning and conte2/"ation of t)e
Co/rig)t 0a# of t)e &)i"i//inesK and assu2ing t)at t)ere #ere indeed
/u*"ic /erfor2ances for /ro5t, #)et)er or not a//e""ee can *e )e"d
"ia*"e t)erefor.
A//e""ant anc)ors its c"ai2 on Section C%c+ of t)e Co/rig)t 0a# #)ic)
SEC. C. 4)e /ro/rietor of a co/rig)t or )is )eirs or
assigns s)a"" )a3e t)e eLc"usi3e rig)t:
%c+ 4o eL)i*it, /erfor2, re/resent, /roduce, or
re/roduce t)e co/rig)ted #or$ in an 2anner or *
an 2et)od #)ate3er for /ro5t or ot)er#iseK if not
re/roduced in co/ies for sa"e, to se"" an 2anuscri/ts
or an record #)atsoe3er t)ereofK
&age 05 of /*
It 2aintains t)at /"aing or singing a 2usica" co2/osition is
uni3ersa"" acce/ted as /erfor2ing t)e 2usica" co2/osition and t)at
/"aing and singing of co/rig)ted 2usic in t)e soda fountain and
restaurant of t)e a//e""ee for t)e entertain2ent of t)e custo2ers
a"t)oug) t)e "atter do not /a for t)e 2usic *ut on" for t)e food and
drin$ constitute /erfor2ance for /ro5t under t)e Co/rig)t 0a# %Brief
for t)e A//e""ant, //. <E-DG+.
;e concede t)at indeed t)ere #ere Z/u*"ic /erfor2ances for /ro5t. Z
4)e #ord Z/erfor2Z as used in t)e Act )as *een a//"ied to ZOne #)o
/"as a 2usica" co2/osition on a /iano, t)ere* /roducing in t)e air
sound #a3es #)ic) are )eard as 2usic ... and if t)e instru2ent )e
/"as on is a /iano /"us a *roadcasting a//aratus, so t)at #a3es are
t)ro#n out, not on" u/on t)e air, *ut u/on t)e ot)er, t)en a"so )e is
/erfor2ing t)e 2usica" co2/osition.Z %Buc$, et a". 3. .uncan, et a".K
Sa2e Je#e"" 0a Sa""e Rea"t Co., CD!. Dd. Series CJA+.
In re"ation t)ereto, it )as *een )e"d t)at Z4)e /"aing of 2usic in dine
and dance esta*"is)2ent #)ic) #as /aid for * t)e /u*"ic in
/urc)ases of food and drin$ constituted Z/erfor2ance for /ro5tZ #it)in
a Co/rig)t 0a#.Z %Buc$, et a". 3. Russon No. >>BE DG !. Su//. C<A+.
4)us, it )as *een eL/"ained t)at #)i"e it is /ossi*"e in suc)
esta*"is)2ents for t)e /atrons to /urc)ase t)eir food and drin$s and
at t)e sa2e ti2e dance to t)e 2usic of t)e orc)estra, t)e 2usic is
furnis)ed and used * t)e orc)estra for t)e /ur/ose of inducing t)e
/u*"ic to /atroni1e t)e esta*"is)2ent and /a for t)e entertain2ent in
t)e /urc)ase of food and drin$s. 4)e defendant conducts )is /"ace of
*usiness for /ro5t, and it is /u*"icK and t)e 2usic is /erfor2ed for
/ro5t %Ibid, /. C<E+. In a si2i"ar case, t)e Court ru"ed t)at Z4)e
&erfor2ance in a restaurant or )ote" dining roo2, * /ersons
e2/"oed * t)e /ro/rietor, of a co/rig)ted 2usica" co2/osition, for
t)e entertain2ent of /atrons, #it)out c)arge for ad2ission to )ear it,
infringes t)e eLc"usi3e rig)t of t)e o#ner of t)e co/rig)t.Z %Her*ert 3.
S)an"e Co.K Jo)n C)urc) Co. 3. Hi""ard Hote" Co., et a"., D>D 7.S. GE@-
GE<+. In de"i3ering t)e o/inion of t)e Court in said t#o cases, Justice
Ho"2es e"a*orated t)us:
If t)e rig)ts under t)e co/rig)t are infringed on" * a
/erfor2ance #)ere 2one is ta$en at t)e door, t)e
are 3er i2/erfect" /rotected. &erfor2ances not
di,erent in $ind fro2 t)ose of t)e defendants cou"d *e
gi3en t)at 2ig)t co2/ete #it) and e3en destro t)e
success of t)e 2ono/o" t)at t)e "a# intends t)e
/"ainti,s to )a3e. It is enoug) to sa t)at t)ere is no
need to construe t)e statute so narro#". 4)e
defendants8 /erfor2ances are not e"ee2osnar. 4)e
are /art of a tota" for #)ic) t)e /u*"ic /as, and t)e
fact t)at t)e /rice of t)e #)o"e is attri*uted to a
/articu"ar ite2 #)ic) t)ose /resent are eL/ected to
order is not i2/ortant. It is true t)at t)e 2usic is not
t)e so"e o*6ect, *ut neit)er is t)e food, #)ic) /ro*a*"
cou"d *e got c)ea/er e"se#)ere. 4)e o*6ect is a re/ast
in surroundings t)at to /eo/"e )a3ing "i2ited /o#er of
con3ersation or dis"i$ing t)e ri3a" noise, gi3e a
"uLurious /"easure not to *e )ad fro2 eating a si"ent
2ea". If 2usic did not /a, it #ou"d *e gi3en u/. If it
/as, it /as out of t)e /u*"ic8s /oc$et. ;)et)er it
/as or not, t)e /ur/ose of e2/"oing it is /ro5t, and
t)at is enoug). %Ibid., /. GE>+.
In t)e case at *ar, it is ad2itted t)at t)e /atrons of t)e restaurant in
Iuestion /a on" for t)e food and drin$s and a//arent" not for
"istening to t)e 2usic. As found * t)e tria" court, t)e 2usic /ro3ided
is for t)e /ur/ose of entertaining and a2using t)e custo2ers in order
to 2a$e t)e esta*"is)2ent 2ore attracti3e and desira*"e %Record on
A//ea", /. D<+. It #i"" *e noted t)at for t)e /"aing and singing t)e
2usica" co2/ositions in3o"3ed, t)e co2*o #as /aid as inde/endent
contractors * t)e a//e""ant %Record on A//ea", /. D>+. It is t)erefore
o*3ious t)at t)e eL/enses entai"ed t)ere* are added to t)e o3er)ead
of t)e restaurant #)ic) are eit)er e3entua"" c)arged in t)e /rice of
t)e food and drin$s or to t)e o3era"" tota" of additiona" inco2e
/roduced * t)e *igger 3o"u2e of *usiness #)ic) t)e entertain2ent
#as /rogra22ed to attract. ConseIuent", it is *eond Iuestion t)at
t)e /"aing and singing of t)e co2*o in defendant-a//e""ee8s
restaurant constituted /erfor2ance for /ro5t conte2/"ated * t)e
Co/rig)t 0a#. %Act C<C> a2ended * &... No. >E, as a2ended+.
Ne3ert)e"ess, a//e""ee cannot *e said to )a3e infringed u/on t)e
Co/rig)t 0a#. A//e""ee8s a""egation t)at t)e co2/osers of t)e
contested 2usica" co2/ositions &aived t)eir rig)t in fa3or of t)e
genera" /u*"ic #)en t)e a""o#ed t)eir inte""ectua" creations to
*eco2e /ro/ert of t)e /u*"ic do2ain *efore a//"ing for t)e
corres/onding co/rig)ts for t)e sa2e %Brief for .efendant-A//e""ee,
//. <>-<G+ is correct.
4)e Su/re2e Court )as ru"ed t)at Z&aragra/) CC of &atent OTce
Ad2inistrati3e Order No. C %as a2ended, dated Se/te2*er <B, <E>A+
entit"ed 8Ru"es of &ractice in t)e &)i"i//ines &atent OTce re"ating to
t)e Registration of Co/rig)t C"ai2s8 /ro2u"gated /ursuant to
Re/u*"ic Act <JG, /ro3ides a2ong ot)er t)ings t)at an inte""ectua"
creation s)ou"d *e co/rig)ted t)irt %C@+ das after its /u*"ication, if
2ade in Mani"a, or #it)in t)e %J@+ das if 2ade e"se#)ere, fai"ure of
#)ic) renders suc) creation /u*"ic /ro/ert.Z %Santos 3. McCu""oug)
&age 0* of /*
&rinting Co2/an, <D SCRA CD>-CDG O<EJ>P. Indeed, if t)e genera"
/u*"ic )as 2ade use of t)e o*6ect soug)t to *e co/rig)ted for t)irt
%C@+ das /rior to t)e co/rig)t a//"ication t)e "a# dee2s t)e o*6ect
to )a3e *een donated to t)e /u*"ic do2ain and t)e sa2e can no
"onger *e co/rig)ted.
A carefu" stud of t)e records re3ea"s t)at t)e song Z.a)i" Sa IoZ
#)ic) #as registered on A/ri" D@, <EGJ %Brief for A//e""ant, /. <@+
*eca2e /o/u"ar in radios, 6u$e *oLes, etc. "ong *efore registration
%4SN, Ma DB, <EJB, //. C-GK DG+ #)i"e t)e song Z4)e Nearness Of YouZ
registered on Januar <>, <EGG %Brief for A//e""ant, /. <@+ )ad *eco2e
/o/u"ar t#ent 53e %DG+ ears /rior to <EJB, %t)e ear of t)e )earing+
or fro2 <E>C %4SN, Ma DB, <EJB, /. DA+ and t)e songs ZSa/ag$at
I$a# A A$inZ and ZSa/ag$at 'a2i A 4ao 0a2angZ *ot) registered on
Ju" <@, <EJJ, a//ear to )a3e *een $no#n and sang * t)e #itnesses
as ear" as <EJG or t)ree ears *efore t)e )earing in <EJB. 4)e
testi2onies of t)e #itnesses at t)e )earing of t)is case on t)is su*6ect
#ere unre*utted * t)e a//e""ant. %Ibid! //. DBK DE and C@+.
7nder t)e circu2stances, it is c"ear t)at t)e 2usica" co2/ositions in
Iuestion )ad "ong *eco2e /u*"ic /ro/ert, and are t)erefore *eond
t)e /rotection of t)e Co/rig)t 0a#.
&REMISES CONSI.ERE., t)e a//ea"ed decision of t)e Court of !irst
Instance of Mani"a in Ci3i" Case No. A<DDD is )ere* A!!IRME..
4.#. No. *1*,00 Jul( *., *...
E$#NANO, /etitioners,
INC., res/ondents.

PA#O, J.:
4)e case *efore us is a /etition for re3ie# on certiorari
to set aside
t)e %a+ decision or t)e Court of A//ea"s
, and %*+ t)e reso"ution
dening /etitioners8 2otion for reconsideration,
in #)ic) t)e
a//e""ate court aTr2ed t)e tria" court8s dis2issa" of t)e co2/"aint for
infringe2ent andYor unfair co2/etition and da2ages *ut de"eted t)e
a#ard for attorne8s fees.12&phi1.n>t
4)e facts are as fo""o#s:
&etitioners are aut)ors and co/rig)t o#ners of du" issued certi5cates
of co/rig)t registration co3ering t)eir /u*"is)ed #or$s, /roduced
t)roug) t)eir co2*ined resources and e,orts, entit"ed CO00EVE
ENV0ISH !OR 4O.AY %CE4 for *re3it+, Boo$s < and D, and ;OR'BOO'
Res/ondent !e"icidad Ro*"es and Vood#i"" 4rading Co., Inc. are t)e
aut)orY/u*"is)er and distri*utorYse""er of anot)er /u*"is)ed #or$
entit"ed Z.E[E0O&INV ENV0ISH &RO!ICIENCYZ %.E& for *re3it+, Boo$s
< and D %<EBG edition+ #)ic) *oo$ #as co3ered * co/rig)ts issued
to t)e2.
In t)e course of re3ising t)eir /u*"is)ed #or$s, /etitioners scouted and
"oo$ed around 3arious *oo$stores to c)ec$ on ot)er teLt*oo$s dea"ing
#it) t)e sa2e su*6ect 2atter. B c)ance t)e ca2e u/on t)e *oo$ of
res/ondent Ro*"es and u/on /erusa" of said *oo$ t)e #ere sur/rised
to see t)at t)e *oo$ #as stri$ing" si2i"ar to t)e contents, sc)e2e of
/resentation, i""ustrations and i""ustrati3e eLa2/"es in t)eir o#n *oo$,
After an ite2i1ed eLa2ination and co2/arison of t)e t#o *oo$s %CE4
and .E&+, /etitioners found t)at se3era" /ages of t)e res/ondent8s
*oo$ are si2i"ar, if not a"" toget)er a co/ of /etitioners8 *oo$, #)ic) is
a case of /"agiaris2 and co/rig)t infringe2ent.
&etitioners t)en 2ade de2ands for da2ages against res/ondents and
a"so de2anded t)at t)e cease and desist fro2 furt)er se""ing and
distri*uting to t)e genera" /u*"ic t)e infringed co/ies of res/ondent
Ro*"es8 #or$s.
Ho#e3er, res/ondents ignored t)e de2ands, )ence, on Ju" A, <EBBK
/etitioners 5"ed #it) t)e Regiona" 4ria" Court, Ma$ati, a co2/"aint for
ZInfringe2ent andYor unfair co2/etition #it) da2agesZ
/ri3ate res/ondents.
In t)e co2/"aint, /etitioners a""eged t)at in <EBG, res/ondent !e"icidad
C. Ro*"es *eing su*stantia"" fa2i"iar #it) t)e contents of /etitioners8
#or$s, and #it)out securing t)eir /er2ission, "ifted, co/ied,
/"agiari1ed andYor trans/osed certain /ortions of t)eir *oo$ CE4. 4)e
teLtua" contents and i""ustrations of CE4 #ere "itera"" re/roduced in
&age 00 of /*
t)e *oo$ .E&. 4)e /"agiaris2, incor/oration and re/roduction of
/articu"ar /ortions of t)e *oo$ CE4 in t)e *oo$ .E&, #it)out t)e
aut)orit or consent of /etitioners, and t)e 2isre/resentations of
res/ondent Ro*"es t)at t)e sa2e #as )er origina" #or$ and conce/t
ad3erse" a,ected and su*stantia"" di2inis)ed t)e sa"e of t)e
/etitioners8 *oo$ and caused t)e2 actua" da2ages * #a of
unrea"i1ed inco2e.
.es/ite t)e de2ands of t)e /etitioners for res/ondents to desist fro2
co22itting furt)er acts of infringe2ent and for res/ondent to reca""
.E& fro2 t)e 2ar$et, res/ondents refused. &etitioners as$ed t)e court
to order t)e su*2ission of a"" co/ies of t)e *oo$ .E&, toget)er #it)
t)e 2o"ds, /"ates and 5"2s and ot)er 2ateria"s used in its /rinting
destroed, and for res/ondents to render an accounting of t)e
/roceeds of a"" sa"es and /ro5ts since t)e ti2e of its /u*"ication and
Res/ondent Ro*"es #as i2/"eaded in t)e suit *ecause s)e aut)ored
and direct" co22itted t)e acts of infringe2ent co2/"ained of, #)i"e
res/ondent Vood#i"" 4rading Co., Inc. #as i2/"eaded as t)e /u*"is)er
and 6oint co-o#ner of t)e co/rig)t certi5cates of registration co3ering
t)e t#o *oo$s aut)ored and caused to *e /u*"is)ed * res/ondent
Ro*"es #it) o*3ious conni3ance #it) one anot)er.
On Ju" DA, <EBB, res/ondent Ro*"es 5"ed a 2otion for a *i"" of
#)ic) t)e tria" court a//ro3ed on August <A, <EBB.
&etitioners co2/"ied #it) t)e desired /articu"ari1ation, and furnis)ed
res/ondent Ro*"es t)e s/eci5c /ortions, inc"usi3e of /ages and "ines,
of t)e /u*"is)ed and co/rig)ted *oo$s of t)e /etitioners #)ic) #ere
trans/osed, "ifted, co/ied and /"agiari1ed andYor ot)er#ise found t)eir
#a into res/ondent8s *oo$.
On August <, <EBB, res/ondent Vood#i"" 4rading Co., Inc. 5"ed its
ans#er to t)e co2/"aint
and a""eged t)at /etitioners )ad no cause of
action against Vood#i"" 4rading Co., Inc. since it #as not /ri3 to t)e
2isre/resentation, /"agiaris2, incor/oration and re/roduction of t)e
/ortions of t)e *oo$ of /etitionersK t)at t)ere #as an agree2ent
*et#een Vood#i"" and t)e res/ondent Ro*"es t)at Ro*"es guaranteed
Vood#i"" t)at t)e 2ateria"s uti"i1ed in t)e 2anuscri/t #ere )er o#n or
t)at s)e )ad secured t)e necessar /er2ission fro2 contri*utors and
sourcesK t)at t)e aut)or assu2ed so"e res/onsi*i"it and )e"d t)e
/u*"is)er #it)out an "ia*i"it.
On No3e2*er DB, <EBB, res/ondent Ro*"es 5"ed )er ans#er
, and
denied t)e a""egations of /"agiaris2 and co/ing t)at /etitioners
c"ai2ed. Res/ondent stressed t)at %<+ t)e *oo$ .E& is t)e /roduct of
)er inde/endent researc)es, studies and eL/eriences, and #as not a
co/ of an eListing 3a"id co/rig)ted *oo$K %D+ .E& fo""o#ed t)e
sco/e and seIuence or s""a*us #)ic) are co22on to a"" Eng"is)
gra22ar #riters as reco22ended * t)e Association of &)i"i//ine
Co""eges of Arts and Sciences %A&CAS+, so an si2i"arit *et#een t)e
res/ondents *oo$ and t)at of t)e /etitioners #as due to t)e
orientation of t)e aut)ors to *ot) #or$s and standards and s""a*usK
and %C+ t)e si2i"arities 2a *e due to t)e aut)ors8 eLercise of t)e
Zrig)t to fair use of co/rigt)ed 2ateria"s, as guides.Z
Res/ondent inter/osed a counterc"ai2 for da2ages on t)e ground t)at
*ad fait) and 2a"ice attended t)e 5"ing of t)e co2/"aint, *ecause
/etitioner Ha*ana #as /rofessiona"" 6ea"ous and t)e *oo$ .E&
re/"aced CE4 as t)e oTcia" teLt*oo$ of t)e graduate studies
de/art2ent of t)e !ar Eastern 7ni3ersit.
.uring t)e /re-tria" conference, t)e /arties agreed to a sti/u"ation of
and for t)e tria" court to 5rst reso"3e t)e issue of infringe2ent
*efore dis/osing of t)e c"ai2 for da2ages.
After t)e tria" on t)e 2erits, on A/ri" DC, <EEC, t)e tria" court rendered
its 6udg2ent 5nding t)us:
;HERE!ORE, /re2ises considered, t)e court )ere*
orders t)at t)e co2/"aint 5"ed against defendants
!e"icidad Ro*"es and Vood#i"" 4rading Co., Inc. s)a"" *e
.ISMISSE.K t)at said /"ainti,s so"idari" rei2*urse
defendant Ro*"es for &D@,@@@.@@ attorne8s fees and
defendant Vood#i"" for &G,@@@.@@ attorne8s fees.
&"ainti,s are "ia*"e for cost of suit.
.one in t)e Cit of Mani"a t)is DCrd da of A/ri", <EEC.
Assisting Judge
S. C. Ad2. Order No. <D>-ED
On Ma <>, <EEC, /etitioners 5"ed t)eir notice of a//ea" #it) t)e tria"
, and on Ju" <E, <EEC, t)e court directed its *ranc) c"er$ of
court to for#ard a"" t)e records of t)e case to t)e Court of A//ea"s.
&age 01 of /*
In t)e a//ea", /etitioners argued t)at t)e tria" court co2/"ete"
disregarded t)eir e3idence and fu"" su*scri*ed to t)e argu2ents of
res/ondent Ro*"es t)at t)e *oo$s in issue #ere /ure" t)e /roduct of
)er researc)es and studies and t)at t)e co/ied /ortions #ere ins/ired
* foreign aut)ors and as suc) not su*6ect to co/rig)t. &etitioners
a"so assai"ed t)e 5ndings of t)e tria" court t)at t)e #ere ani2ated *
*ad fait) in instituting t)e co2/"aint.
On June DA, <EEA, t)e Court of A//ea"s rendered 6udg2ent in fa3or of
res/ondents Ro*"es and Vood#i"" 4rading Co., Inc. 4)e re"e3ant
/ortions of t)e decision state:
It 2ust *e noted, )o#e3er, t)at si2i"arit of t)e
a""eged" infringed #or$ to t)e aut)or8s or /ro/rietor8s
co/rig)ted #or$ does not of itse"f esta*"is) co/rig)t
infringe2ent, es/ecia"" if t)e si2i"arit resu"ts fro2
t)e fact t)at *ot) #or$s dea" #it) t)e sa2e su*6ect or
)a3e t)e sa2e co22on source, as in t)is case.
A//e""ee Ro*"es )as fu"" eL/"ained t)at t)e /ortion or
2ateria" of t)e *oo$ c"ai2ed * a//e""ants to )a3e
*een co/ied or "ifted fro2 foreign *oo$s. S)e )as du"
/ro3en t)at 2ost of t)e to/ics or 2ateria"s contained
in )er *oo$, #it) /articu"ar reference to t)ose 2atters
c"ai2ed * a//e""ants to )a3e *een /"agiari1ed #ere
to/ics or 2atters a//earing not on" in a//e""ants and
)er *oo$s *ut a"so in ear"ier *oo$s on Co""ege Eng"is),
inc"uding foreign *oo$s, e.i. Ed2und Bur$e8s ZS/eec)
on Conci"iationZ, Boerigs8 ZCo2/etence in Eng"is)Z and
Broug)ton8s, ZEd2und Bur$e8s Co""ection.Z
A//e""ant8s re"iance on t)e "ast /aragra/) on Section II
is 2is/"aced. It 2ust *e e2/)asi1ed t)at t)e fai"ed to
/ro3e t)at t)eir *oo$s #ere 2ade sources *
4)e Court of A//ea"s #as of t)e 3ie# t)at t)e a#ard of attornes8 fees
#as not /ro/er, since t)ere #as no *ad fait) on t)e /art of /etitioners
Ha*ana et al. in instituting t)e action against res/ondents.
On Ju" <D, <EEA, /etitioners 5"ed a 2otion for
)o#e3er, t)e Court of A//ea"s denied t)e sa2e in a
dated No3e2*er DG, <EEA.
Hence, t)is /etition.
In t)is a//ea", /etitioners su*2it t)at t)e a//e""ate court erred in
aTr2ing t)e tria" court8s decision.
&etitioners raised t)e fo""o#ing issues: %<+ #)et)er or not, des/ite t)e
a//arent teLtua", t)e2atic and seIuentia" si2i"arit *et#een .E& and
CE4, res/ondents co22itted no co/rig)t infringe2entK %D+ #)et)er
or not t)ere #asanimus %urandi on t)e /art of res/ondent #)en t)e
refused to #it)dra# t)e co/ies of CE4 fro2 t)e 2ar$et des/ite notice
to #it)dra# t)e sa2eK and %C+ #)et)er or not res/ondent Ro*"es
a*used a #riter8s rig)t to fair use, in 3io"ation of Section << of
&residentia" .ecree No. >E.
;e 5nd t)e /etition i2/ressed #it) 2erit.
4)e co2/"aint for co/rig)t infringe2ent #as 5"ed at t)e ti2e t)at
&residentia" .ecree No. >E #as in force. At /resent, a"" "a#s dea"ing
#it) t)e /rotection of inte""ectua" /ro/ert rig)ts )a3e *een
conso"idated and as t)e "a# no# stands, t)e /rotection of co/rig)ts is
go3erned * Re/u*"ic Act No. BDEC. Not#it)standing t)e c)ange in t)e
"a#, t)e sa2e /rinci/"es are reiterated in t)e ne# "a# under Section
<AA. It /ro3ides for t)e co/ or econo2ic rig)ts of an o#ner of a
co/rig)t as fo""o#s:
Sec. <AA. Copy or ?conomic rights. ^ Su*6ect to t)e
/ro3isions of c)a/ter [III, co/rig)t or econo2ic rig)ts
s)a"" consist of t)e eLc"usi3e rig)t to carr out,
aut)ori1e or /re3ent t)e fo""o#ing acts:
<AA.< Re/roduction of t)e #or$ or substanlial
portion of t)e #or$K
<AA.D .ra2ati1ation, trans"ation, ada/tation,
a*ridge2ent, arrange2ent or ot)er transfor2ation of
t)e #or$K
<AA.C 4)e 5rst /u*"ic distri*ution of t)e origina" and
eac) co/ of t)e #or$ * sa"e or ot)er for2s of
transfer of o#ners)i/K
<AA.> Renta" of t)e origina" or a co/ of an audio3isua"
or cine2atogra/)ic #or$, a #or$ e2*odied in a sound
recording, a co2/uter /rogra2, a co2/i"ation of data
and ot)er 2ateria"s or a 2usica" #or$ in gra/)ic for2,
&age 0/ of /*
irres/ecti3e of t)e o#ners)i/ of t)e origina" or t)e
co/ #)ic) is t)e su*6ect of t)e renta"K %n+
<AA.G &u*"ic dis/"a of t)e origina" or co/ of t)e #or$K
<AA.J &u*"ic /erfor2ance of t)e #or$K and
<AA.A Ot)er co22unication to t)e /u*"ic of t)e
4)e "a# a"so /ro3ided for t)e "i2itations on co/rig)t, t)us:
Sec. <B>.< Limitations on copyright. ^
Not#it)standing t)e /ro3isions of C)a/ter [, t)e
fo""o#ing acts s)a"" not constitute infringe2ent of
%a+ t)e recitation or /erfor2ance of a
#or$, once it )as *een "a#fu"" 2ade
accessi*"e to t)e /u*"ic, if done
/ri3ate" and free of c)arge or if 2ade
strict" for a c)arita*"e or re"igious
institution or societK OSec. <@%<+, &...
No. >EP
%*+ 4)e 2a$ing of Iuotations fro2 a
/u*"is)ed #or$ if t)e are co2/ati*"e
#it) fair use and on" to t)e eLtent
6usti5ed for t)e /ur/ose, inc"uding
Iuotations fro2 ne#s/a/er artic"es
and /eriodica"s in t)e for2 of /ress
su22ariesK +rovided, t)at t)e source
and t)e na2e of t)e aut)or, if
a//earing on t)e #or$ are 2entionedK
%Sec. << t)ird /ar. &... >E+
%e+ The inclusion o% a &ork in a publication, *roadcast,
or ot)er co22unication to t)e /u*"ic, sound recording
of 5"2, if suc) inc"usion is 2ade * #a of i""ustration
for teac)ing /ur/oses and is co2/ati*"e #it) fair
use: +rovided, That the source and the name o% the
author! i% appearing in the &ork is mentionedK
In t)e a*o3e Iuoted /ro3isions, Z#or$Z )as reference to "iterar and
artistic creations and t)is inc"udes *oo$s and ot)er "iterar, sc)o"ar"
and scienti5c #or$s.
A /erusa" of t)e records ie"ds se3era" /ages of t)e *oo$ .E& t)at are
si2i"ar if not identica" #it) t)e teLt of CE4.
On /age >@> of /etitioners8 Boo$ < of Co""ege Eng"is) for 4oda, t)e
aut)ors #rote:
Items in dates and addresses:
He died on Monda, A/ri" <G, <EAG.
Miss Rees "i3es in D<> 4aft A3enue,
On /age AC of res/ondents Boo$ < .e3e"o/ing Eng"is) 4oda, t)e
He died on Monda, A/ri" DG, <EAG.
Miss Rees address is D<> 4aft A3enue Mani"a
On &age DG@ of CE4, t)ere is t)is eLa2/"e on /ara""e"is2 or re/etition
of sentence structures, t)us:
4)e /ro/osition is /eace. Not /eace t)roug) t)e
2ediu2 of #arK not /eace to *e )unted t)roug) t)e
"a*rint) of intricate and end"ess negotiationsK not
/eace to arise out of uni3ersa" discord, fo2ented fro2
/rinci/"e, in a"" /arts of t)e e2/ireK not /eace to
de/end on t)e 6uridica" deter2ination of /er/"eLing
Iuestions, or t)e /recise 2ar$ing of t)e *oundar of a
co2/"eL go3ern2ent. It is si2/"e /eaceK soug)t in its
natura" course, and in its ordinar )aunts. It is /eace
soug)t in t)e s/irit of /eace, and "aid in /rinci/"es
/ure" /aci5c.
^ Ed2und Bur$e, ZS/eec) on Criticis2.Z
On /age <@@ of t)e *oo$ .E&
, a"so in t)e to/ic of /ara""e" structure
and re/etition, t)e sa2e eLa2/"e is found in toto. 4)e on" di,erence
&age 0, of /*
is t)at /etitioners ac$no#"edged t)e aut)or Ed2und Bur$e, and
res/ondents did not.
In se3era" ot)er /ages
t)e treat2ent and 2anner of /resentation of
t)e to/ics of .E& are si2i"ar if not a re)as) of t)at contained in CE4.
;e *e"ie3e t)at res/ondent Ro*"es8 act of "ifting fro2 t)e *oo$ of
/etitioners su*stantia" /ortions of discussions and eLa2/"es, and )er
fai"ure to ac$no#"edge t)e sa2e in )er *oo$ is an infringe2ent of
/etitioners8 co/rig)ts.
;)en is t)ere a su*stantia" re/roduction of a *oo$_ It does not
necessari" reIuire t)at t)e entire co/rig)ted #or$, or e3en a "arge
/ortion of it, *e co/ied. If so 2uc) is ta$en t)at t)e 3a"ue of t)e
origina" #or$ is su*stantia"" di2inis)ed, t)ere is an infringe2ent of
co/rig)t and to an in6urious eLtent, t)e #or$ is a//ro/riated.
In deter2ining t)e Iuestion of infringe2ent, t)e a2ount of 2atter
co/ied fro2 t)e co/rig)ted #or$ is an i2/ortant consideration. 4o
constitute infringe2ent, it is not necessar t)at t)e #)o"e or e3en a
"arge /ortion of t)e #or$ s)a"" )a3e *een co/ied. If so 2uc) is ta$en
t)at t)e 3a"ue of t)e origina" is sensi*" di2inis)ed, or t)e "a*ors of
t)e origina" aut)or are su*stantia"" and to an in6urious eLtent
a//ro/riated * anot)er, t)at is suTcient in /oint of "a# to constitute
4)e essence of inte""ectua" /irac s)ou"d *e essaed in conce/tua"
ter2s in order to underscore its gra3it * an a//ro/riate
understanding t)ereof. Infringe2ent of a co/rig)t is a tres/ass on a
/ri3ate do2ain o#ned and occu/ied * t)e o#ner of t)e co/rig)t,
and, t)erefore, /rotected * "a#, and infringe2ent of co/rig)t, or
/irac, #)ic) is a snon2ous ter2 in t)is connection, consists in t)e
doing * an /erson, #it)out t)e consent of t)e o#ner of t)e
co/rig)t, of ant)ing t)e so"e rig)t to do #)ic) is conferred *
statute on t)e o#ner of t)e co/rig)t.
4)e res/ondents8 c"ai2 t)at t)e co/ied /ortions of t)e *oo$ CE4 are
a"so found in foreign *oo$s and ot)er gra22ar *oo$s, and t)at t)e
si2i"arit *et#een )er st"e and t)at of /etitioners can not *e a3oided
since t)e co2e fro2 t)e sa2e *ac$ground and orientation 2a *e
true. Ho#e3er, in t)is 6urisdiction under Sec <B> of Re/u*"ic Act BDEC
it is /ro3ided t)at:
0i2itations on Co/rig)t. Not#it)standing t)e
/ro3isions of C)a/ter [, t)e fo""o#ing s)a"" not
constitute infringe2ent of co/rig)t:
%c+ 4)e 2a$ing of Iuotations fro2 a
/u*"is)ed #or$ if t)e are co2/ati*"e
#it) fair use and on" to t)e eLtent
6usti5ed for t)e /ur/ose, inc"uding
Iuotations fro2 ne#s/a/er artic"es
and /eriodica"s in t)e for2 of /ress
su22aries: +rovided, 4)at t)e source
and t)e na2e of t)e aut)or, if
a//earing on t)e #or$, are 2entioned.
A co/ of a /irac is an infringe2ent of t)e origina", and it is no
defense t)at t)e /irate, in suc) cases, did not $no# #)et)er or not )e
#as infringing an co/rig)tK )e at "east $ne# t)at #)at )e #as
co/ing #as not )is, and )e co/ied at )is /eri".
4)e neLt Iuestion to reso"3e is to #)at eLtent can co/ing *e in6urious
to t)e aut)or of t)e *oo$ *eing co/ied. Is it enoug) t)at t)ere are
si2i"arities in so2e sections of t)e *oo$s or "arge seg2ents of t)e
*oo$s are t)e sa2e_
In t)e case at *ar, t)ere is no Iuestion t)at /etitioners /resented
se3era" /ages of t)e *oo$s CE4 and .E& t)at 2ore or "ess )ad t)e
sa2e contents. It 2a *e correct t)at t)e *oo$s *eing gra22ar *oo$s
2a contain 2ateria"s si2i"ar as to so2e tec)nica" contents #it) ot)er
gra22ar *oo$s, suc) as t)e seg2ent a*out t)e ZAut)or CardZ.
Ho#e3er, t)e nu2erous /ages t)at t)e /etitioners /resented s)o#ing
si2i"arit in t)e st"e and t)e 2anner t)e *oo$s #ere /resented and
t)e identica" eLa2/"es can not /ass as si2i"arities 2ere" *ecause of
tec)nica" consideration.
4)e res/ondents c"ai2 t)at t)eir si2i"arit in st"e can *e attri*uted to
t)e fact t)at *ot) of t)e2 #ere eL/osed to t)e A&CAS s""a*us and
t)eir res/ecti3e acade2ic eL/erience, teac)ing a//roac) and
2et)odo"og are a"2ost identica" *ecause t)e #ere of t)e sa2e
Ho#e3er, #e *e"ie3e t)at e3en if /etitioners and res/ondent Ro*"es
#ere of t)e sa2e *ac$ground in ter2s of teac)ing eL/erience and
orientation, it is not an eLcuse for t)e2 to *e identica" e3en in
eLa2/"es contained in t)eir *oo$s. 4)e si2i"arities in eLa2/"es and
2ateria" contents are so o*3ious" /resent in t)is case. Ho# can
si2i"arYidentica" eLa2/"es not *e considered as a 2ar$ of co/ing_
&age 06 of /*
;e consider as an indicia of gui"t or #rongdoing t)e act of res/ondent
Ro*"es of /u""ing out fro2 Vood#i"" *oo$stores t)e *oo$ .E& u/on
"earning of /etitioners8 co2/"aint #)i"e /)arisaica"" dening
/etitioners8 de2and. It #as furt)er noted t)at #)en t)e *oo$ .E& #as
re-issued as a re3ised 3ersion, a"" t)e /ages cited * /etitioners to
contain /ortion of t)eir *oo$ Co""ege Eng"is) for 4oda #ere
In cases of infringe2ent, co/ing a"one is not #)at is /ro)i*ited. 4)e
co/ing 2ust /roduce an Zin6urious e,ectZ. Here, t)e in6ur consists in
t)at res/ondent Ro*"es "ifted fro2 /etitioners8 *oo$ 2ateria"s t)at
#ere t)e resu"t of t)e "atter8s researc) #or$ and co2/i"ation and
2isre/resented t)e2 as )er o#n. S)e circu"ated t)e *oo$ .E& for
co22ercia" use did not ac$no#"edged /etitioners as )er source.
Hence, t)ere is a c"ear case of a//ro/riation of co/rig)ted #or$ for
)er *ene5t t)at res/ondent Ro*"es co22itted. &etitioners8 #or$ as
aut)ors is t)e /roduct of t)eir "ong and assiduous researc) and for
anot)er to re/resent it as )er o#n is in6ur enoug). In co/rig)ting
*oo$s t)e /ur/ose is to gi3e /rotection to t)e inte""ectua" /roduct of
an aut)or. 4)is is /recise" #)at t)e "a# on co/rig)t /rotected, under
Section <B>.< %*+. Ruotations fro2 a /u*"is)ed #or$ if t)e are
co2/ati*"e #it) fair use and on" to t)e eLtent 6usti5ed * t)e
/ur/ose, inc"uding Iuotations fro2 ne#s/a/er artic"es and /eriodica"s
in t)e for2 of /ress su22aries are a""o#ed /ro3ided t)at t)e source
and t)e na2e of t)e aut)or, if a//earing on t)e #or$, are 2entioned.
In t)e case at *ar, t)e "east t)at res/ondent Ro*"es cou"d )a3e done
#as to ac$no#"edge /etitioners Ha*ana as t)e source of t)e
/ortions of .E&. 4)e 5na" /roduct of an aut)or8s toi" is )er *oo$. 4o
a""o# anot)er to co/ t)e *oo$ #it)out a//ro/riate ac$no#"edg2ent
is in6ur enoug).
;HERE!ORE, t)e /etition is )ere* VRAN4E.. 4)e decision and
reso"ution of t)e Court of A//ea"s in CA-V. R. C[ No. >>@GC are SE4
ASI.E. 4)e case is ordered re2anded to t)e tria" court for furt)er
/roceedings to recei3e e3idence of t)e /arties to ascertain t)e
da2ages caused and sustained * /etitioners and to render decision
in accordance #it) t)e e3idence su*2itted to it.
0apunan and @nares6Santiago! AA.! concur.
.avide! Ar.! C.A.! I dissent! please see dissenting opinion.
Melo! A.! no part! personal reason.

Separate Opinions

AJI$, J#., C.J., dissenting o/inion:
I a2 una*"e to 6oin t)e 2a6orit 3ie#.
!ro2 t)e fo""o#ing factua" and /rocedura" antecedents, I 5nd no
a"ternati3e *ut to sustain *ot) t)e tria" court and t)e Court of A//ea"s.
On <D Ju" <EBB, HABANA, et al. 5"ed #it) t)e tria" court a co2/"aint
for infringe2ent and unfair co2/etition, #it) da2ages against /ri3ate
res/ondent !e"icidad C. Ro*"es %)ereafter ROB0ES+ and )er /u*"is)er
and distri*utor, Vood#i"" 4rading Co., Inc. %)ereafter VOO.;I00+. 4)e
case #as doc$eted as Ci3i" Case No. BB-<C<A.
HABANA, et al. a3erred in t)eir co2/"aint t)at t)e #ere t)e co-
aut)ors and 6oint co/rig)t o#ners of t)eir /u*"is)ed #or$s Co""ege
Eng"is) for 4oda, Boo$s < and D %)ereafter CE4+ and ;or$*oo$ for
Co""ege !res)2an Eng"is), Series <
K t)e disco3ered t)at ROB0ES8
o#n /u*"is)ed #or$s, .e3e"o/ing Eng"is) &ro5cienc, Boo$s < and D,
%)ereafter .E&+, /u*"is)ed and distri*uted in <EBG, eL)i*ited an
uncann rese2*"ance, if not outrig)t /)sica" si2i"arit, to CE4 as to
content, sc)e2e, seIuence of to/ics and ideas, 2anner of
/resentation and i""ustrati3e eLa2/"esK t)e /"agiaris2, incor/oration
and re/roduction of /articu"ar /ortions of CE4 into .E& cou"d not *e
gainsaid since ROB0ES #as su*stantia"" fa2i"iar #it) CE4 and t)e
teLtua" as/ortation #as acco2/"is)ed #it)out t)eir aut)orit andYor
consentK ROB0ES and VOO.;I00 6oint" 2isre/resented .E& %o3er
#)ic) t)e s)ared co/rig)t o#ners)i/+ Zas t)e for2er8s origina"
/u*"is)ed #or$s and conce/tKZ and Znot#it)standing for2a" de2ands
2ade . . . to cease and desist fro2 t)e sa"e and distri*ution of .E&,
OROB0ES and VOO.;I00P /ersistent" fai"ed and refused to co2/"
t)ere#it).Z HABANA et al. t)en /raed for t)e court to: %<+ order t)e
su*2ission and t)ereafter t)e destruction of a"" co/ies of .E&,
toget)er #it) t)e 2o"ds, /"ates, 5"2s and ot)er 2ateria"s used in t)e
&age 0< of /*
/rinting t)ereofK %D+ reIuire ROB0ES and VOO.;I00 to render an
accounting of t)e sa"es of t)e Zinfringing #or$s fro2 t)e ti2e of its
%sic+ ince/ti3e /u*"ication u/ to t)e ti2e of 6udg2ent, as #e"" as t)e
a2ount of sa"es and /ro5ts . . . deri3edKZ and %C+ to en6oin ROB0ES and
VOO.;I00 to so"idari" /a actua", 2ora" and eLe2/"ar da2ages, as
#e"" as attorne8s fees and eL/enses of "itigation.
In its Ans#er, VOO.;I00 denied cu"/a*i"it since Zit )ad no $no#"edge
or infor2ation suTcient to for2 a *e"ief as to t)e a""egations of
/"agiaris2, incor/oration and re/roductionZ and )ence Zcou"d not *e
/ri3 to t)e sa2e, if %t)ere #ere+ anKZ and t)at in an Agree2ent #it)
co-defendant ROB0ES, t)e "atter #ou"d *e so"e" res/onsi*"e for acts
of /"agiaris2 or 3io"ations of co/rig)t or an ot)er "a#, to t)e eLtent
of ans#ering for an and a"" da2ages VOO.;I00 2a su,er.
VOO.;I00 a"so inter/osed a co2/u"sor counterc"ai2 against
&ACI4A, et al. and a crossc"ai2 against its co-defendant anc)ored on
t)e afore2entioned Agree2ent.
In )er ans#er, ROB0ES asserted t)at: %<+ .E& #as t)e eLc"usi3e
/roduct of )er inde/endent researc), studies and eL/erienceK %D+ .E&,
/articu"ar" t)e seg2ents #)ere t)e a""eged "itera" si2i"itude
a//eared, #ere ad2itted" inQuenced or ins/ired * ear"ier treatises,
2ost" * foreign aut)orsK *ut t)at ZinQuences andYor ins/irations
fro2 ot)er #ritersZ "i$e t)e 2et)odo"og and tec)niIues as to
/resentation, teac)ing conce/t and design, researc) and orientation
#)ic) s)e e2/"oed, fe"" #it)in t)e a2*it of genera" infor2ation,
ideas, /rinci/"es of genera" or uni3ersa" $no#"edge #)ic) #ere
co22on" and custo2ari" understood as inca/a*"e of /ri3ate and
eLc"usi3e use, a//ro/riation or co/rig)tK and %C+ )er #or$s #ere t)e
resu"t of t)e "egiti2ate and reasona*"e eLercise of an aut)or8s Zrig)t to
fair use of e3en co/rig)ted 2ateria"s as OaP guide.Z S)e furt)er
c"ai2ed t)at )er 3arious nationa" and regiona" /rofessiona" acti3ities in
genera" education, "anguage and "iterature, as #e"" as )er teac)ing
eL/erience in graduate and /ost graduate education #ou"d o*3iate
t)e re2otest /ossi*i"it of /"agiaris2.
ROB0ES "i$e#ise suggested t)at an si2i"arit *et#een .E& and CE4
as regards sco/e and seIuence cou"d *e attri*uted to Zt)e orientation
of t)e aut)ors to t)e sco/e and seIuence or s""a*us ^ #)ic)
incor/orates standards $no#n a2ong Eng"is) gra22ar *oo$ #riters ^
of t)e su*6ect-2atter for Basic Co22unication Arts reco22ended *
t)e Association of &)i"i//ine Co""eges of Arts and Sciences %A&CAS+.Z
;)i"e t)e s""a*us #as ad2itted" ado/ted in .E&, s)e c"ai2ed to
)a3e treated Iuite di,erent" in .E& t)e 3er ideas, tec)niIues or
/rinci/"es eL/ressed in CE4 suc) t)at neit)er teLt*oo$ cou"d *e
considered a co/ or /"agiaris2 of t)e ot)er.
At t)e /re-tria" conference, t)e /arties agreed to a sti/u"ation of
and for t)e court to 5rst reso"3e t)e issue of infringe2ent
*efore dis/osing of t)e c"ai2s for da2ages. After tria" on t)e 2erits,
t)e tria" court rendered its decision in fa3or of defendants, t)e
dis/ositi3e /ortion of #)ic) reads:
;HERE!ORE, /re2ises considered, t)e Court )ere*
orders t)at t)e co2/"aint 5"ed against defendants
!e"icidad Ro*"es and Vood#i"" 4rading Co., Inc. s)a"" *e
.ISMISSE.: t)at said /"ainti,s so"idari" rei2*urse
defendant Ro*"es for &D@,@@@.@@ attorne8s fees and
defendant Vood#i"" for &G,@@@.@@ attorne8s fees.
&"ainti,s are "ia*"e for costs of suit.
Noting t)at t)e "a# a//"ica*"e to t)e case #as &residentia" .ecree No.
t)e tria" court found t)at HABANA, et al. fai"ed to disc)arge t)eir
onus of /ro3ing t)at ROB0ES and VOO.;I00 co22itted acts
constituting co/rig)t infringe2ent. Moreo3er, t)e tria" court found
t)at Zt)e cause of action or acts co2/"ained of O#ereP not co3ered *
said decreeZ as Section <@ t)ereof *arred aut)ors of #or$s a"read
"a#fu"" 2ade accessi*"e to t)e /u*"ic fro2 /ro)i*iting t)e
re/roductions, trans"ations, ada/tations, recitation and /erfor2ance of
t)e sa2e, #)i"e Section << a""o#ed t)e uti"i1ation of re/roductions,
Iuotations and eLcer/ts of suc) #or$s. 4)e tria" court t)us agreed
#it) ROB0ES t)at Zt)e co2/"ained acts O#ereP of genera" and
uni3ersa" $no#"edge and use #)ic) /"ainti,s cannot c"ai2 origina"it
or see$ redress to t)e "a# for /rotectionZ and o*ser3ed t)at .E& and
CE4 )ad t)e sa2e sources, consisting c)ieQ of ear"ier #or$s, 2ost"
foreign *oo$s. VOO.;I008s crossc"ai2 against ROB0ES, counterc"ai2
against HABANA, et al. as #e"" as ROB0ES8 co2/u"sor counterc"ai2
against VOO.;I00 #ere a"" dis2issed for "ac$ of factua" and "ega"
HABANA, et al. a//ea"ed to t)e Court of A//ea"s. 4)e case #as
doc$eted as CA-V.R. C[ No. >>@GC. Before said court HABANA, et al.,
in t)e 2ain, argued t)at t)e tria" court tota"" disregarded t)eir
e3idence and 2ere" su*scri*ed to ROB0ES8 argu2ents. 4)e Court of
A//ea"s, )o#e3er, "i$e#ise dis/osed of t)e contro3ers in fa3or of
ROB0ES and VOO.;I00.
Ho#e3er, t)e Court of A//ea"s 2odi5ed t)e tria" court8s decision *
re3ersing t)e a#ard for attorne8s fees. It )e"d t)at t)e good fait) and
sincerit of HABANA, et al. in co22encing t)e action negated t)e
*asis t)erefor. 4)eir 2otion for reconsideration )a3ing *een denied for
#ant of cogent reasons, HABANA, et al., instituted t)is /etition. 4)e
&age 0+ of /*
c"ai2 t)at t)e Court of A//ea"s co22itted re3ersi*"e error in fai"ing to
a//reciate: %<+ t)e insu/era*"e e3idence and facts ad2itted and
/ro3ed de2onstrating /"agiaris2 or /irac and instead a,orded fu""
#eig)t and credit to ROB0ES8 2atriL of genera", )/ot)etica" and
s#ee/ing state2ents andYor defensesK %D+ ROB0ES8 and
VOO.;I008s animo %urandi or intent to a//ro/riate or co/ CE4 #it)
t)e non-re2o3a" of t)e da2aging co/ies of .E& fro2 t)e *oo$stores
des/ite notice to #it)dra# t)e sa2eK and %C+ t)e fact t)at ROB0ES
a*used a #riter8s rig)t to fair use, in 3io"ation of Section << of &... No.
4)e in3o$e Lakta& v. +aglina&an
#)ic), t)e t)eori1e is on a""
fours #it) t)e case at *ar. ROB0ES contends t)at a//ea"
* certiorari does not "ie in t)is case for t)e c)a""enged decision and
t)e tria" court8s 6udg2ent #ere a2/" su//orted * e3idence,
/ertinent "a#s and 6uris/rudence. Hence, )er counterc"ai2 for 2ora"
da2ages s)ou"d, t)erefore, *e granted or for us to order t)e re2and
of t)e case to t)e tria" court for rece/tion of e3idence on da2ages.
VOO.;I00, on its /art, stood /at on its disc"ai2er, #it) t)e assertion
t)at no /roof #as e3er introduced. t)at it co-aut)ored .E& or t)at it
sing" or in ca*a" #it) ROB0ES co22itted an act constituting
co/rig)t infringe2ent.
4)e core issue t)en is #)et)er or not t)e Court of A//ea"s erred in
aTr2ing t)e tria" court8s 6udg2ent t)at des/ite t)e a//arent teLtua",
t)e2atic and seIuentia" si2i"arit *et#een .E& and CE4, no co/rig)t
#as co22itted * ROB0ES and VOO.;I00.
;)i"e t)e co2/"aint, in Ci3i" Case No. BB-<C<A #as 5"ed during t)e
e,ecti3it of &... No. >E, t)e /ro3isions of t)e ne# inte""ectua"
/ro/ert "a#, R.A. No. BDEC,
ne3ert)e"ess *ears signi5cance )ere. It
too$ e,ect on < Januar <EEB, *ut its Section DCE.C c"ear" states t)at
its /ro3isions s)a"" a//" to #or$s in #)ic) co/rig)t /rotection
o*tained /rior to t)e e,ecti3it of t)e Act su*sists, /ro3ided, )o#e3er,
t)at t)e a//"ication of t)e Act s)a"" not resu"t in t)e di2inution of suc)
/rotection. A"so, t)e /)i"oso/) *e)ind *ot) statutes as #e"" as t)e
essentia" /rinci/"es of co/rig)t /rotection and co/rig)t infringe2ent
)a3e, to a certain eLtent, re2ained t)e sa2e.
A co/rig)t 2a *e accurate" de5ned as t)e rig)t granted * statute
to t)e /ro/rietor of an inte""ectua" /roduction to its eLc"usi3e use and
en6o2ent to t)e eLtent s/eci5ed in t)e statute.
7nder Section <AA
of R.A. No. BDEC,
t)e co/ or econo2ic rig)t %co/rig)t and
econo2ic rig)t are used interc)angea*" in t)e statute+ consists of t)e
eLc"usi3e rig)t to carr out, aut)ori1e or /re3ent t)e fo""o#ing acts:
<AA.< Re/roduction of t)e #or$ or su*stantia" /ortion
of t)e #or$K
<AA.D .ra2ati1ation, trans"ation, ada/tation,
a*ridg2ent, arrange2ent or ot)er transfor2ation of
t)e #or$K
<AA.C 4)e 5rst /u*"ic distri*ution of t)e origina" and
eac) co/ of t)e #or$ * sa"e or ot)er for2s of
transfer of o#ners)i/K
<AA.> Renta" of t)e origina" or a co/ of an audio3isua"
or cine2atogra/)ic #or$, a #or$ e2*odied in a sound
recording, a co2/uter /rogra2, a co2/i"ation of data
and ot)er 2ateria"s or a 2usica" #or$ in gra/)ic for2,
irres/ecti3e of t)e o#ners)i/ of t)e origina" or t)e
co/ #)ic) is t)e su*6ect of t)e renta"K
<AA.G &u*"ic dis/"a of t)e origina" or a co/ of t)e
<AA.J &u*"ic /erfor2ance of t)e #or$K and
<AA.A Ot)er co22unication to t)e /u*"ic of t)e #or$.
Z4)e #or$,Z as re/eated" 2entioned, refers to t)e "iterar and artistic
#or$s de5ned as origina" inte""ectua" creations in t)e "iterar and
artistic do2ain /rotected fro2 t)e 2o2ent of t)eir creation and
enu2erated in Section <AD.<, #)ic) inc"udes *oo$s and ot)er "iterar,
sc)o"ar", scienti5c and artistic #or$s.
Stri//ed in t)e 2eanti2e of its indis/uta*"e socia" and *ene5cia"
t)e use of inte""ectua" /ro/ert or creations s)ou"d
*asica"" /ro2ote t)e creator or aut)or8s /ersona" and econo2ic gain.
Hence, t)e co/rig)t /rotection eLtended to t)e creator s)ou"d ensure
)is attain2ent of so2e for2 of /ersona" satisfaction and econo2ic
re#ard fro2 t)e #or$ )e /roduced. ;it)out conceding t)e suita*i"it
of 0a$ta# as /recedent, t)e Court t)ere Iuoted Manresa and
He #)o #rites a *oo$, or car3es a statute, or 2a$es an
in3ention, )as t)e a*so"ute rig)t to re/roduce or se"" it,
6ust as t)e o#ner of t)e "and )as t)e a*so"ute rig)t to
se"" it or its fruits. But #)i"e t)e o#ner of t)e "and, *
se""ing it and its fruits, /er)a/s fu"" rea"i1es a"" its
econo2ic 3a"ue, * recei3ing its *ene5ts and uti"ities,
#)ic) are re/resented for eLa2/"e, * t)e /rice, on
t)e ot)er )and t)e aut)or of a *oo$, statue or
in3ention does not rea/ a"" t)e *ene5ts and
&age 0. of /*
ad3antages of )is o#n /ro/ert * dis/osing of it, for
t)e 2ost i2/ortant for2 of rea"i1ing t)e econo2ic
ad3antages of a *oo$, statue or in3ention, consists in
t)e rig)t to re/roduce it in si2i"ar or "i$e co/ies,
e3erone of #)ic) ser3es to gi3e to t)e /erson
re/roducing t)e2 a"" t)e conditions #)ic) t)e origina"
reIuires in order to gi3e t)e aut)or t)e fu"" en6o2ent
t)ereof. If t)e aut)or of a *oo$, after its /u*"ication,
cannot /re3ent its re/roduction * an /erson #)o
2a #ant to re/roduce it, t)en t)e /ro/ert rig)t
granted )i2 is reduced to a 3er insigni5cant t)ing
and t)e e,ort 2ade in t)e /roduction of t)e *oo$ is in
no #a re#arded.
4)e eLecution, t)erefore, of an one or 2ore of t)e eLc"usi3e rig)ts
conferred * "a# on a co/rig)t o#ner, #it)out )is consent,
constitutes co/rig)t infringe2ent. In essence, co/rig)t
infringe2ent, $no#n in genera" as Z/irac,Z is a tres/ass on a do2ain
o#ned and occu/ied * a co/rig)t o#nerK it is 3io"ation of a /ri3ate
rig)t /rotected * "a#.
;it) t)e in3asion of )is /ro/ert rig)ts, a
co/rig)t o#ner is natura"" entit"ed to see$ redress, enforce and )o"d
accounta*"e t)e defrauder or usur/er of said econo2ic rig)ts.
No#, did ROB0ES and VOO.;I00 infringe u/on t)e co/rig)t of
HABANA et al. * /u*"is)ing .E&, #)ic) t)e "atter a""eged to *e a
re/roduction, or in t)e "east, a su*stantia" re/roduction of CE4_ Bot)
t)e tria" court and res/ondent court found in t)e negati3e. I su*2it
t)e #ere correct.
4o constitute infringe2ent, t)e usur/er 2ust )a3e co/ied or
a//ro/riated t)e Zorigina"Z #or$ of an aut)or or co/rig)t
a*sent co/ing, t)ere can *e no infringe2ent of
In turn, a #or$ is dee2ed * "a# an origina" if t)e aut)or
created it * )is o#n s$i"", "a*or and 6udg2ent.
On its /art, a co/ is
t)at #)ic) co2es so near to t)e origina" so as to gi3e to e3er /erson
seeing it t)e idea created * t)e origina". It )as *een )e"d t)at t)e test
of co/rig)t infringe2ent is #)et)er an ordinar o*ser3er co2/aring
t)e #or$s can readi" see t)at one )as *een co/ied fro2 t)e ot)er.
3isua" co2/arison of t)e /ortions of CE4
6uLta/osed against certain
/ages of .E&,
#ou"d inesca/a*" "ead to a conc"usion t)at t)ere is a
discerni*"e si2i"arit *et#een t)e t#oK )o#e3er, as correct" assessed
* res/ondent court and t)e "o#er court, no conc"usion, can *e dra#n
t)at .E&, in "ega" conte2/"ation, is a co/ of CE4.
;as .E& a su*stantia" re/roduction of CE4_ 4o constitutes a
su*stantia" re/roduction, it is not necessar t)at t)e entire
co/rig)ted #or$, or e3en a "arge /ortion of it, *e co/ied, if so 2uc) is
ta$en t)at t)e 3a"ue of t)e origina" is su*stantia"" di2inis)ed, or if t)e
"a*ors of t)e origina" aut)or are su*stantia"", and to an in6urious
eLtent, a//ro/riated.
But t)e si2i"arit of t)e *oo$s )ere does not
a2ount to an a//ro/riation of a su*stantia" /ortion of CE4. If t)e
eListence of su*stantia" si2i"arities does not of itse"f esta*"is)
2ere si2i"arities %not su*stantia" si2i"arities+ in so2e
sections of t)e *oo$s in Iuestion decisi3e" 2i"itate against a c"ai2 for
infringe2ent #)ere t)e si2i"arities )ad *een con3incing" esta*"is)ed
as /roceeding fro2 a nu2*er of reasons andYor factors.
<. As *ot) *oo$s are gra22ar *oo$s, t)e ine3ita*" dea" #it) t)e
sa2e su*6ects t/ica"" and ordinari" treated * #riters of suc)
e.g., sste2 of *oo$ c"assi5cation, t)e di,erent $inds of card
cata"ogs and t)eir entries, use of /unctuation 2ar$s, /aragra/)s, t)e
c)aracteristics of an e,ecti3e /aragra/), "anguage structure, di,erent
/arts of a *oo$, etc. 4)ese standard su*6ects fa"" #it)in t)e do2ain of
ideas, conce/ts, uni3ersa" and genera" $no#"edge t)at )a3e, as
ad2itted * t)e /rotagonists )ere, *een in eListence for Iuite a "ong
As suc), HABANA, et al. cannot de2and 2ono/o", * #a of
eLa2/"e, in t)e use of t)e recogni1ed "i*rar c"assi5cation sste2s
%.e#e .eci2a" Sste2 and t)e 0i*rar of Congress Sste2+, or )o#
a *oo$ can *e di3ided into /arts %frontis/iece, tit"e /age, co/rig)t
/age, /reface, ta*"e of contents, etc.+ or to t)e di,erent )eadings used
in a card cata"ogue %tit"e card, aut)or card and su*6ect card+, since
t)ese are of co22on or genera" $no#"edge. E3en in t)is 6urisdiction,
no /rotection can *e eLtended to suc) an idea, /rocedure, sste2
2et)od or o/eration, conce/t, /rinci/"e, disco3er or 2ere data, e3en
if eL/ressed, eL/"ained, i""ustrated or e2*odied in a #or$.
D. As found * res/ondent court, CE4 and .E& )ad co22on sources
and 2ateria"s,
suc) t)at t)e /articu"ar /ortions c"ai2ed to )a3e
*een "ifted and "itera"" re/roduced a"so a//eared in ear"ier #or$s,
2ost" * foreign aut)ors. 4)is is c"ear fro2 t)e testi2on of
/etitioner .r. &acita Ha*ana:
R 0et8s c"arif our /osition .ra.
Ha*ana. ;)en defendants test %sic+
s)o#ed <@ #ords si2i"ar to ours, ou
so conc"uded it #as %sic+ co/ied fro2
ours *ut #)en I /ointed out to ou
sa2e %sic+ #ords contained in t)e
ear"ier *oo$ of ;i""s t)en ou ear"ier in
our test in our *oo$ %sic+ ou refused
to ad2it t)at it #as co/ied fro2 ;i""s.
A Yes, sir. ;e )a3e ne3er ^ a"" CG
#ords #ere co/ied fro2 t)ere.
&age 15 of /*
R But #)at I a2 as$ing )o# cou"d ou
conc"ude t)at * 6ust si2i"arit of <@
#ords of defendants #ords t)at #as
co/ied fro2 ours OsicP and #)en I
/oint out to ou t)e si2i"arit of t)at
sa2e #ords fro2 t)e #ords ear"ier
t)an ours %sic+ ou refused to ad2it
t)at ou co/ied_
A I #ou"d "i$e to c)ange t)e 5na"
state2ent no# t)at in t)e case of
defendant Ro*"es ou /ointed out )er
source 3er c"ear. S)e co/ied it fro2
t)at *oo$ * ;i""s.
R So, s)e did not co/ it fro2 ours_
A A"rig)t, 2a*e s)e did not co/ it
*ut de5nite" it is a /attern of
/"ageris2 OsicP.
C. Si2i"arit in orientation and st"e can "i$e#ise *e attri*uted to t)e
eL/osure of t)e aut)ors to t)e A&CAS s""a*us and t)eir res/ecti3e
acade2ic eL/erience, teac)ing a//roac)es and 2et)odo"og. It is not
farfetc)ed t)at t)e cou"d )a3e e3en inQuenced eac) ot)er as
teLt*oo$ #riters. ROB0ES and .r. &acita Ha*ana #ere facu"t
2e2*ers of t)e Institute of Eng"is) of t)e !ar Eastern 7ni3ersit fro2
<EJ> to <EA>.
Bot) #ere ardent students, researc)ers, "ecturers,
teLt*oo$ #riters and teac)ers of Eng"is) and gra22ar. 4)e e3en
used to *e on friend" ter2s #it) eac) ot)er, to t)e eLtent t)at .r.
Ha*ana ad2itted t)at ROB0ES assisted t)e for2er in t)e /re/aration
of )er doctora" dissertation. Vi3en t)eir near-identica" acade2ic and
/rofessiona" *ac$ground, it is natura" t)e #ou"d use 2an
eL/ressions and de5nitions /ecu"iar to teac)ing Eng"is) gra22ar. It
co2es t)erefore #it) no sur/rise t)at t)ere are si2i"arities in so2e
/arts of t)e ri3a" *oo$s. Indeed, it is diTcu"t to concei3e )o# #riters
on t)e sa2e su*6ect 2atter can 3er #e"" a3oid resorting to co22on
sources of infor2ation and 2ateria"s and e2/"oing si2i"ar
eL/ressions and ter2s /ecu"iar to t)e su*6ect t)e are treating.
4o i""ustrate, an eLcer/t fro2 /age D< of CE4 reads:
Aut)or Card
4)e aut)or card is t)e 2ain entr card. It contains
<. t)e aut)or8s co2/"ete na2e on t)e
5rst "ine, surna2e 5rst, #)ic) 2a *e
fo""o#ed * t)e date of )is *irt) and
deat) if )e is no "onger "i3ingK
D. t)e tit"e of t)e *oo$, and t)e
su*tit"e, if t)ere is oneK
C. t)e edition, if it is not t)e 5rstK
>. t)e trans"ator or i""ustrator, if t)ere
is anK
G. t)e i2/rint #)ic) inc"udes t)e
/u*"is)er, t)e /"ace and date of
J. t)e co""ation co2/osed of t)e
nu2*er of /ages, 3o"u2e, i""ustrations,
and t)e si1e of t)e *oo$K
A. t)e su*6ects #it) #)ic) t)e *oo$
dea"s OsicPK
B. t)e ca"" nu2*er on t)e u//er "eft-
)and corner.
Na2es *eginning #it) Mc, or M are 5"ed in t)e card
cata"og as t)oug) s/e""ed out as MAC, for eLa2/"e Mc
Vra# ^ MacVra#. 4)e sa2e is true of St. and Saint.
;)i"e a /ortion of .E& found on /age <B #)ic) discusses t)e
aut)or card /ro3ides:
4)e aut)or card is t)e 2ain entr card containing:
<. t)e aut)or8s co2/"ete na2e on t)e
5rst "ine, surna2e 5rst, #)ic) 2a *e
fo""o#ed * t)e date of )is *irt) and
deat) if )e is no "onger "i3ingK
D. t)e tit"e of t)e *oo$, and t)e su*tit"e
if t)ere is oneK
&age 1* of /*
C. t)e edition, if it is not t)e 5rstK
>. t)e trans"ator or i""ustrator, if anK
G. t)e i2/rint #)ic) inc"udes t)e
/u*"is)er, t)e /"ace and date of
J. t)e co""ation, co2/osed of t)e
nu2*er of /ages, 3o"u2e, i""ustrations,
and t)e si1e of t)e *oo$K
A. t)e su*6ect #it) #)ic) t)e *oo$
dea"sK and
B. t)e ca"" nu2*er on t)e u//er-"eft
)and corner.
Na2es *eginning #it) MC, or M are 5"ed in t)e card
cata"og considered s/e""ed out as MAC, for eLa2/"e:
Mc"eod-Mac"eod. 4)is is true a"so of St. and Saint.
4)e entries found in an aut)or card, )a3ing *een de3e"o/ed o3er Iuite
so2eti2e, are eL/ected" unifor2. Hence, HABANA et al. and ROB0ES
#ou"d )a3e no c)oice *ut to articu"ate t)e ter2s /articu"ar to t)e
entries in an identica" 2anner.
I t)us 5nd t)at t)e ru"ing of t)e res/ondent court is tota"" su//orted
* t)e e3idence on record. Of doctrina" /ersuasion is t)e /rinci/"e t)at
factua" deter2inations of t)e Court of A//ea"s and t)e tria" court are
conc"usi3e and *inding u/on t)is Court, and t)e "atter #i"" not, as a
ru"e, distur* t)ese 5ndings un"ess co2/e""ing and cogent reasons
necessitate a reeLa2ination, if not a re3ersa", of t)e sa2e.
against t)is 6uris/rudentia" canon, to su*6ect t)e c)a""enged decision
of t)e Court of A//ea"s to furt)er scrutin #ou"d *e su/erQuous, if not,
I a2 not /ersuaded * t)e c"ai2 of HABANA, et al. t)at 0a$ta# is on a""
fours #it) and )ence a//"ica*"e to t)e case at *ar. 4)ere, t)is Court
dis/osed t)at defendant, #it)out t)e consent of and causing
irre/ara*"e da2age to 0a$ta#, re/roduced t)e "atter8s "iterar #or$
.iccionario Hisa/ano-4aga"og, and i2/ro/er" co/ied t)e greater /art
t)ereof in t)e #or$ .iccionariong 'asti"a-4aga"og /u*"is)ed *
defendant, in 3io"ation of Artic"e A of t)e 0a# of <@ Januar <BAE on
Inte""ectua" &ro/ert. 4)is Court anc)ored its decision on t)e fo""o#ing
%<+ OOP t)e DC,GJ@ S/anis) #ords in t)e defendant8s
dictionar . . . on" C,<@B #ords are t)e defendant8s
o#n, or, #)at is t)e sa2e t)ing, t)e defendant )as
added on" t)is nu2*er of #ords to t)ose t)at are in
t)e /"ainti,8s dictionar, )e )a3ing re/roduced or
co/ied t)e re2aining D@,>GD #ordsK
%D+ O4P)e defendant a"so "itera"" re/roduced and
co/ied for t)e S/anis) #ords in )is dictionar, t)e
eIui3a"ents, de5nitions and di,erent 2eanings in
4aga"og, gi3en in /"ainti,s dictionar, )a3ing
re/roduced, as to so2e #ords, e3ert)ing t)at
a//ears in t)e /"ainti,8s dictionar for si2i"ar S/anis)
#ords, a"t)oug) as to so2e )e 2ade so2e additions
of )is o#n. Said co/ies and re/roductions are
nu2erous. . .K
%C+ O4P)e /rinter8s errors in t)e /"ainti,8s dictionar as
to t)e eL/ression of so2e #ords in S/anis) as #e"" as
t)eir eIui3a"ents in 4aga"og are a"so re/roduced, a fact
#)ic) s)o#s t)at t)e defendant, in /re/aring )is
dictionar, "itera"" co/ied t)ose S/anis) #ords and
t)eir 2eanings and eIui3a"ents in 4aga"og fro2 t)e
/"ainti,8s dictionar.
&"ain", t)e rationa"e in 0a$ta# does not a//" in t)is case. !irst, aside
fro2 an iso"ated accounting of t)e nu2*er of #ords su//osed"
usur/ed in a seg2ent of .E& fro2 CE4,
t)e records do not disc"ose
t)at a"" t)e #ords a""eged" co/ied #ere ta""ied and t)at t)e #ords
t)us ta""ied #ere nu2erous enoug) to su//ort a 5nding of co/ing.
Second, as a"read conceded, #)i"e t)ere is an identit in t)e 2anner
* #)ic) so2e of t)e ideas and conce/ts #ere articu"ated, t)is
/rescinded fro2 3arious factors a"read e"ucidated. Besides, ROB0ES8
testi2on t)at s)e 2ade an inde/endent in3estigation or researc) of
t)e origina" #or$s or aut)ors s)e consu"ted #as unre*uttedK
ger2ane )ere is t)e Iuestion of #)et)er t)e a""eged infringer cou"d
)a3e o*tained t)e sa2e infor2ation * going to t)e sa2e source *
)er o#n inde/endent researc).
ROB0ES con3inced t)e tria" court
and t)e Court of A//ea"s on t)isK t)us, #e are *ound * t)is factua"
deter2ination, as "i$e#ise eL/"ained ear"ier. 4)ird, re/roduction of t)e
/rinter8s errors or t)e aut)or8s *"unders and inaccuracies in t)e
infringing co/ does not ipso %acto constitute co/ing or /"agiaris2 or
infringe2ent, *ut it is conceded t)at t)e are te""ta"e signs t)at
infringe2ent 2ig)t )a3e *een co22itted.
Ho#e3er, t)e records do
&age 10 of /*
not re3ea" t)is to *e t)e case. !ourt), t)e "a# on inte""ectua" /ro/ert
3io"ated in 0a$ta# #as a #or"d and ti2e a/art fro2 R.A. No. BDEC or
e3en &... No. >E. 4)us, under Artic"e A of t)e 0a# of <@ Januar <BAE,
t)e Court ru"ed t)at no*od cou"d re/roduce anot)er /erson8s #or$
#it)out t)e o#ner8s consent, e3en 2ere" to annotate or add ant)ing
to it, or i2/ro3e an edition t)ereof. 4)e 2ore recent "a#s on
inte""ectua" /ro/ert, )o#e3er, recogni1e recent ad3ance2ents in
tec)no"og transfer and infor2ation disse2ination. 4)e t)us a""o#
t)e use of co/rig)ted 2ateria"s if co2/ati*"e #it) fair use and to t)e
eLtent 6usti5ed for t)e /ur/ose. In /articu"ar, t)e ne# "a#s sanction
t)e fair use of co/rig)ted #or$ for criticis2, co22ent, ne#s
re/orting, teac)ing inc"uding 2u"ti/"e co/ies for c"assroo2 use,
sc)o"ars)i/, researc) and si2i"ar /ur/oses.
!urt)er, t)e "i2itations
of t)e eLc"usi3e use of co/rig)ted 2ateria"s under Sections <@ and
<< of &... No. >E in consonance #it) t)e /rinci/"e of fair use )a3e
*een re/roduced and incor/orated in t)e ne# "a#.
A"" to"d, 0a$ta# is
!air use )as *een de5ned as a /ri3i"ege to use t)e co/rig)ted
2ateria" in a reasona*"e 2anner #it)out t)e consent of t)e co/rig)t
o#ner or as co/ing t)e t)e2e or ideas rat)er t)an t)eir
No Iuestion of fair or unfair use arises )o#e3er, if no
co/ing is /ro3ed to *egin #it). 4)is is in consonance #it) t)e
/rinci/"e t)at t)ere can *e no infringe2ent if t)ere #as no
It is on" #)ere so2e for2 of co/ing )as *een s)o#n t)at
it *eco2es necessar to deter2ine #)et)er it )as *een carried to an
Zunfair,Z t)at is, i""ega", eLtent.
ConseIuent", t)ere is no reason to
address t)e issue of #)et)er ROB0ES a*used a #riter8s rig)t to fair
use #it) t)e ascertain2ent t)at .E& #as not a co/ or a su*stantia"
co/ of CE4.
;HERE!ORE, I 3ote to .ENY t)e /etition and to A!!IRM t)e c)a""enged
decision of DA June <EEA of t)e Court of A//ea"s.
4.#. No. */<5/1 June 0*, 055,
CO#P., /etitioners,
JU& C. 9)AN4, G$NITO ;$9 7 &JONN$ ;. C9UAKG$LT#ON
%AC9IN$#& ISPLA& 7 T#A$ C$NT$#, INC., and T9$
S$C#$TA#& OE JUSTIC$, res/ondents.
. E C I S I O N
4)e Case
4)is is a /etition for certiorari
of t)e Reso"utions
of t)e .e/art2ent
of Justice dis2issing for Z"ac$ of 2erit and insuTcienc of e3idenceZ
/etitioner Microsoft Cor/orationWs co2/"aint against res/ondents for
co/rig)t infringe2ent and unfair co2/etition.
4)e !acts
&etitioner Microsoft Cor/oration %ZMicrosoftZ+, a .e"a#are, 7nited
States cor/oration, o#ns t)e co/rig)t and trade2ar$ to se3era"
co2/uter soft#are.
Res/ondents Benito 'e) and Y3onne 'e) are t)e
&residentYManaging .irector and Venera" Manager, res/ecti3e", of
res/ondent Be"tron Co2/uter &)i"i//ines, Inc. %ZBe"tronZ+, a do2estic
cor/oration. Res/ondents Jonat)an '. C)ua, E2i" '. C)ua, Benito 4.
Sanc)e1, and Nanc I. [e"asco are Be"tronWs .irectors. On t)e ot)er
)and, res/ondents A"fonso C)ua, A"*erto C)ua, Jud '. C)ua H#ang,
So/)ia Ong, and .eanna C)ua are t)e .irectors of res/ondent 4ai#an
Mac)iner .is/"a ( 4rade Center, Inc. %Z4M4CZ+, a"so a do2estic
In Ma <EEC, Microsoft and Be"tron entered into a 0icensing
Agree2ent %ZAgree2entZ+. 7nder Section D%a+ of t)e Agree2ent, as
a2ended in Januar <EE>, Microsoft aut)ori1ed Be"tron, for a fee, to:
%i+ LLL re/roduce and insta"" no 2ore t)an one %<+ co/ of
OMicrosoftP soft#are on eac) Custo2er Sste2 )ard dis$ or
Read On" Me2or %ZROMZ+K OandP
%ii+ LLL distri*ute direct" or indirect" and "icense co/ies of t)e
&roduct %re/roduced as /er Section D%a+%i+ andYor acIuired
fro2 Aut)ori1ed Re/"icator or Aut)ori1ed .istri*utor+ in o*6ect
code for2 to end usersO.P LLLL
4)e Agree2ent a"so aut)ori1ed Microsoft and Be"tron to ter2inate t)e
contract if t)e ot)er fai"s to co2/" #it) an of t)e Agree2entWs
/ro3isions. Microsoft ter2inated t)e Agree2ent e,ecti3e DD June <EEG
for Be"tronWs non-/a2ent of roa"ties.
After#ards, Microsoft "earned t)at res/ondents #ere i""ega"" co/ing
and se""ing Microsoft soft#are. ConseIuent", Microsoft, t)roug) its
&age 11 of /*
&)i"i//ine agent,
)ired t)e ser3ices of &in$erton Consu"ting Ser3ices
%Z&CSZ+, a /ri3ate in3estigati3e 5r2. Microsoft a"so soug)t t)e
assistance of t)e Nationa" Bureau of In3estigation %ZNBIZ+. On <@
No3e2*er <EEG, &CS e2/"oee Jo)n Benedic
Sacri1 %ZSacri1Z+ and NBI
agent .o2inador Sa2iano, Jr. %ZSa2ianoZ+, /osing as re/resentati3es
of a co2/uter s)o/,
*oug)t co2/uter )ard#are %centra" /rocessing
unit %ZC&7Z+ and co2/uter 2onitor+ and soft#are %<D co2/uter dis$s
%ZC.sZ+ in read-on" 2e2or %ZROMZ+ for2at+ fro2 res/ondents. 4)e
C&7 contained /re-insta""ed
Microsoft ;indo#s C.< and MS-.OS
soft#are. 4)e <D C.-ROMs, encased in /"astic containers #it)
Microsoft /ac$aging, a"so contained Microsoft soft#are.
At "east t#o
of t)e C.-ROMs #ere Zinsta""ers,Z so-ca""ed *ecause t)e contain
se3era" soft#are %Microsoft on" or *ot) Microsoft and non-
Sacri1 and Sa2iano #ere not gi3en t)e Microsoft end-user
"icense agree2ents, userWs 2anua"s, registration cards or certi5cates
of aut)enticit for t)e artic"es t)e /urc)ased. 4)e recei/t issued to
Sacri1 and Sa2iano for t)e C&7 and 2onitor *ore t)e )eading
Z4.M.4.C. %&HI0S.+ INC. BE04RON COM&74ER.Z
4)e recei/t for t)e <D
C.-ROMs did not indicate its source a"t)oug) t)e na2e ZVer"ieZ
a//ears *e"o# t)e entr Zde"i3ered *.Z
On <A No3e2*er <EEG, Microsoft a//"ied for searc) #arrants against
res/ondents in t)e Regiona" 4ria" Court, Branc) DC, Mani"a
4)e R4C granted MicrosoftWs a//"ication and issued t#o
searc) #arrants %ZSearc) ;arrant Nos. EG-JB> and EG-JBGZ+.
Searc) ;arrant Nos. EG-JB> and EG-JBG, t)e NBI searc)ed t)e
/re2ises of Be"tron and 4M4C and sei1ed se3era" co2/uter-re"ated
)ard#are, soft#are, accessories, and /ara/)erna"ia. A2ong t)ese
#ere 0,+1* pieces of C-#O%s containing Microsoft soft#are.
Based on t)e artic"es o*tained fro2 res/ondents, Microsoft and a
certain 0otus .e3e"o/2ent Cor/oration %Z0otus Cor/orationZ+ c)arged
res/ondents *efore t)e .e/art2ent of Justice %Z.OJZ+ #it) co/rig)t
infringe2ent under Section G%A+ in re"ation to Section DE of
&residentia" .ecree No. >E, as a2ended, %Z&. >EZ+
and #it) unfair
co2/etition under Artic"e <BE%<+
of t)e Re3ised &ena" Code. In its
Co2/"aint %ZI.S. No. EJ-<ECZ+, #)ic) t)e NBI indorsed, Microsoft
a""eged t)at res/ondents i""ega"" co/ied and so"d Microsoft soft#are.
In t)eir 6oint counter-aTda3it, res/ondents Y3onne 'e) %Zres/ondent
'e)Z+ and E2i" '. C)ua %Zres/ondent C)uaZ+ denied t)e c)arges
against res/ondents. Res/ondents 'e) and C)ua a""eged t)at: %<+
MicrosoftWs rea" intention in 5"ing t)e co2/"aint under I.S. No. EJ-<EC
#as to /ressure Be"tron to /a its a""eged un/aid roa"ties, t)us
Microsoft s)ou"d )a3e 5"ed a co""ection suit instead of a cri2ina"
co2/"aintK %D+ 4M4C *oug)t t)e con5scated GE *oLes of MS-.OS C.s
fro2 a Microsoft dea"er in Singa/ore %R.R. .onne""+K %C+ res/ondents
are not t)e ZsourceZ of t)e Microsoft ;indo#s C.< soft#are /re-
insta""ed in t)e C&7 *oug)t * Sacri1 and Sa2iano, *ut on" of t)e MS-
.OS soft#areK %>+ MicrosoftWs a""eged /roof of /urc)ase %recei/t+ for
t)e <D C.-ROMs is inconc"usi3e *ecause t)e recei/t does not indicate
its sourceK and %G+ res/ondents Benito 'e), Jonat)an '. C)ua, A"fonso
C)ua, A"*erto C)ua, Jud '. C)ua H#ang, So/)ia Ong, and .eanna
C)ua are stoc$)o"ders of Be"tron and 4M4C in na2e on" and t)us
cannot *e )e"d cri2ina"" "ia*"e.
4)e ot)er res/ondents did not 5"e counter-aTda3its.
Mean#)i"e, res/ondents 2o3ed to Iuas) Searc) ;arrant Nos. EG-JB>
and EG-JBG. 4)e R4C /artia"" granted t)eir 2otion in its Order of <J
A/ri" <EEJ. Microsoft soug)t reconsideration *ut t)e R4C denied
MicrosoftWs 2otion in its Order of <E Ju" <EEJ. Microsoft a//ea"ed to
t)e Court of A//ea"s in CA-V.R. C[ No. G>J@@. In its .ecision of DE
No3e2*er D@@<, t)e Court of A//ea"s granted MicrosoftWs a//ea" and
set aside t)e R4C Orders of <J A/ri" <EEJ and <E Ju" <EEJ. 4)e Court
of A//ea"sW .ecision *eca2e 5na" on DA .ece2*er D@@<.
4)e .OJ Reso"utions
In t)e Reso"ution of DJ Octo*er <EEE, .OJ State &rosecutor Joce"n A.
Ong %ZState &rosecutor OngZ+ reco22ended t)e dis2issa" of
MicrosoftWs co2/"aint for "ac$ of 2erit and insuTcienc of e3idence.
State &rosecutor Ong a"so reco22ended t)e dis2issa" of 0otus
Cor/orationWs co2/"aint for "ac$ of interest to /rosecute and for
insuTcienc of e3idence. Assistant C)ief State &rosecutor 0ua")ati R.
Buenafe %ZAssistant C)ief State &rosecutor BuenafeZ+ a//ro3ed State
&rosecutor OngWs reco22endations.
4)e DJ Octo*er <EEE Reso"ution
reads in /art:
O4P#o %D+ issues )a3e to *e reso"3ed in t)is case, na2e":
a+ ;)et)er or not Be"tron Co2/uter andYor its stoc$)o"ders
s)ou"d *e )e"d "ia*"e for t)e o,enses c)arged.
*+ ;)et)er or not /ri2a facie case eListOsP against 4ai#an
Mac)iner .is/"a and 4rade Center, Inc. %4M4C+ for 3io"ation
of t)e o,ense c)arged.
Co2/"ainant )ad a""eged t)at fro2 t)e ti2e t)e "icense agree2ent
#as ter2inated, res/ondentYs isYare no "onger aut)ori1ed to
co/Ydistri*uteYse"" Microsoft /roducts. Ho#e3er, res/ondentYs a3erred
t)at t)e case is ci3i" in nature, not cri2ina", considering t)at t)e case
ste22ed on" out of t)e desire of co2/"ainant to co""ect fro2 t)e2
&age 1/ of /*
t)e a2ount of 7S?<CG,<D<.CD and t)at t)e contract entered into *
t)e /arties cannot *e uni"atera"" ter2inated.
In t)e order of Honora*"e ;i""ia2 Ba)on dated Ju" <E, <EEJ Odening
reconsideration to t)e Order /artia"" Iuas)ing t)e searc) #arrantsP,
)e o*ser3ed t)e fo""o#ing:
ZIt is furt)er argued * counse" for res/ondent t)at t)e act ta$en *
/ri3ate co2/"ainant is to s/ite re3enge against t)e res/ondent Be"tron
for t)e "atter fai"ed to /a t)e a""eged 2onetar o*"igation in t)e
a2ount of 7S?<CG,<D<.CD. 4)at res/ondent )as so2e 2onetar
o*"igation to co2/"ainant #)ic) is not denied * t)e co2/"ainant.Z
OZPIt a//ears t)erefore t)at /rior to t)e issuance of t)e su*6ect searc)
#arrants, co2/"ainant )ad so2e *usiness transactions #it) t)e
res/ondent OBe"tronP a"ong t)e sa2e "ine of /roducts. Co2/"ainant
fai"ed to re3ea" t)e true circu2stances eListing *et#een t)e t#o of
t)e2 as it no# a//ears, indeed t)e searc) #arrantOsP LLL OareP *eing
used as a "e3erage to secure co""ection of t)e 2one o*"igation #)ic)
t)e Court cannot a""o#.Z
!ro2 said order, it can *e g"eaned t)at t)e OR4CP LLL, )ad ad2itted
t)at t)e searc) #arrants a//"ied for * co2/"ainant #ere 2ere" used
as a "e3erage for t)e co""ection of t)e a""eged 2onetar o*"igation of
t)e res/ondentYs.
!ro2 said order, it can *e sur2ise %sic+ t)at t)e o*"igations *et#een
t)e /arties is ci3i" in nature not cri2ina".
Moreo3er, co2/"ainant )ad ti2e and again )ar/ed t)at res/ondentYs
isYare not aut)ori1ed to se""Yco/Ydistri*ute Microsoft /roducts at t)e
ti2e of t)e eLecution of t)e searc) #arrants. Sti"", t)is oTce )as no
/o#er to /ass u/on said issue for one )as t)en to inter/ret t)e
/ro3isions of t)e contract entered into * t)e /arties, #)ic) Iuestion,
s)ou"d *e raised in a /ro/er ci3i" /roceeding.
According", a*senOtP a reso"ution fro2 t)e /ro/er court of %sic+
#)et)er or not t)e contract is sti"" *inding *et#een t)e /arties at t)e
ti2e of t)e eLecution of t)e searc) #arrants, t)is oTce cannot /ass
u/on t)e issue of #)et)er res/ondentYs is or are "ia*"e for t)e o,ense
As to t)e second issue, #e 5nd for t)e res/ondentYs. 4M4C )ad
/ro3ided suTcient e3idence suc) as /ro-for2a in3oice fro2 R.R.
.onne""eK .e*t Ad3ice of t)e Ban$ of Co22erceK OTcia" Recei/ts
fro2 t)e Bureau of Custo2sK and I2/ort Entr .ec"aration of t)e
Bureau of Custo2s to /ro3e t)at indeed t)e Microsoft soft#are in t)eir
/ossession #ere *oug)t fro2 Singa/ore.
4)us, res/ondentYs in t)is case )asY)a3e no intent to defraud t)e
/u*"ic, as /ro3ided under Artic"e <BE of t)e Re3ised &ena" Code, for
t)e *oug)t said Microsoft MS-.OS J.@ fro2 an a""eged "icensee of
Microsoft in Singa/ore, #it) a"" t)e necessar /a/ers. In t)eir o/inion,
#)at t)e )a3e are genuine Microsoft soft#are, t)erefore no unfair
co2/etition eList.
Moreo3er, 3io"ation of &... >E does not eList, for res/ondentYs
#asY#ere not t)e 2anufacturers of t)e Microsoft soft#are sei1ed and
#ere se""ing t)eir /roducts as genuine Microsoft soft#are, considering
t)at t)e *oug)t it fro2 a Microsoft "icensee.
Co2/"ainant, on t)e ot)er )and, considering t)at it )as t)e *urden of
/ro3ing t)at t)e res/ondentYs isYare "ia*"e for t)e o,ense c)arged, )as
not /resented an e3idence t)at t)e ite2s sei1ed na2e" t)e GE
*oLes of MS-.OS J.@ soft#are are counterfeit.
4)e certi5cation issued on .ece2*er <D, <EEG * C)risto/)er Austin,
Cor/orate Attorne of t)e co2/"ainant, does not disc"ose t)is fact. !or
t)e ter2 used * Mr. Austin #as t)at t)e ite2s sei1ed #ere
4)e Iuestion no#, is #)et)er t)e /roducts #ere unaut)ori1ed *ecause
4M4C )as no "icense to se"" Microsoft /roducts, or is it unaut)ori1ed
*ecause R.R. .onne""e )as no aut)orit to se"" said /roducts )ere in
t)e &)i"i//ines.
Sti"", to deter2ine t)e cu"/a*i"it of t)e res/ondents, co2/"ainant
s)ou"d /resent e3idence t)at #)at is in t)e /ossession of t)e
res/ondentYs isYare counterfeit Microsoft /roducts.
4)is it fai"ed to do.
Microsoft soug)t reconsideration and /raed for an ocu"ar ins/ection
of t)e artic"es sei1ed fro2 res/ondents. Ho#e3er, in t)e Reso"ution of
C .ece2*er <EEE, Assistant C)ief State &rosecutor Buenafe, u/on
State &rosecutor OngWs reco22endation, denied MicrosoftWs 2otion.
Microsoft a//ea"ed to t)e OTce of t)e .OJ Secretar. In t)e Reso"ution
of C August D@@@, .OJ 7ndersecretar Regis [. &uno dis2issed
MicrosoftWs a//ea".
Microsoft soug)t reconsideration *ut its 2otion
#as denied in t)e Reso"ution of DD .ece2*er D@@@.
&age 1, of /*
Hence, t)is /etition. Microsoft contends t)at:
In its Co22ent, 5"ed * t)e So"icitor Venera", t)e .OJ 2aintains t)at it
did not co22it gra3e a*use of discretion in dis2issing MicrosoftWs
!or t)eir /art, res/ondents a""ege in t)eir Co22ent t)at Microsoft is
gui"t of foru2-s)o//ing *ecause its /etition in CA-V.R. C[ No. G>J@@
#as 5"ed a)ead of, and )as a Zco22on interestZ #it), t)is /etition. On
t)e 2erits, res/ondents reiterate t)eir c"ai2s in t)eir 2otion to Iuas)
Searc) ;arrant Nos. EG-JB> and EG-JBG t)at t)e artic"es sei1ed fro2
t)e2 #ere eit)er o#ned * ot)ers, /urc)ased fro2 "egiti2ate sources,
or not /roduced * Microsoft. Res/ondents a"so insist t)at t)e
Agree2ent entit"ed Be"tron to Zco/ and re/"icate or re/roduceZ
Microsoft /roducts. On t)e con5scated D,BC< C.-ROMs, res/ondents
a""ege t)at a certain cor/oration
"eft t)e C.-ROMs #it) t)e2 for
safe$ee/ing. 0ast", res/ondents c"ai2 t)at t)ere is no /roof t)at t)e
C&7 Sacri1 and Sa2iano *oug)t fro2 t)e2 contained /re-insta""ed
Microsoft soft#are *ecause t)e recei/t for t)e C&7 does not indicate
ZOsPoft#are )ard dis$.Z
In its Re/", Microsoft counters t)at it is not "ia*"e for foru2-s)o//ing
*ecause its /etition in CA-V.R. C[ No. G>J@@ in3o"3ed t)e Orders of
t)e R4C /artia"" Iuas)ing Searc) ;arrant Nos. EG-JB> and EG-JBG
#)i"e t)is /etition concerns t)e .OJ Reso"utions dis2issing its
co2/"aint against res/ondents for co/rig)t infringe2ent and unfair
co2/etition. On t)e 2erits, Microsoft 2aintains t)at res/ondents
s)ou"d *e indicted for co/rig)t infringe2ent and unfair co2/etition.
4)e Issues
4)e /etition raises t)e fo""o#ing issues:
%<+ ;)et)er Microsoft engaged in foru2-s)o//ingK and
%D+ ;)et)er t)e .OJ acted #it) gra3e a*use of discretion in
not 5nding /ro*a*"e cause to c)arge res/ondents #it)
co/rig)t infringe2ent and unfair co2/etition.
4)e Ru"ing of t)e Court
4)e /etition )as 2erit.
Microsoft did not Engage in Forum-Shopping
!oru2-s)o//ing ta$es /"ace #)en a "itigant 5"es 2u"ti/"e suits
in3o"3ing t)e sa2e /arties, eit)er si2u"taneous" or successi3e", to
secure a fa3ora*"e 6udg2ent.
4)us, it eLists #)ere t)e e"e2ents
of litis pendentia are /resent, na2e": %a+ identit of /arties, or at "east
suc) /arties #)o re/resent t)e sa2e interests in *ot) actionsK %*+
identit of rig)ts asserted and re"ief /raed for, t)e re"ief *eing
founded on t)e sa2e factsK and %c+ t)e identit #it) res/ect to t)e t#o
/receding /articu"ars in t)e t#o cases is suc) t)at an 6udg2ent t)at
2a *e rendered in t)e /ending case, regard"ess of #)ic) /art is
successfu", #ou"d a2ount to res =udicata in t)e ot)er case.
s)o//ing is an act of 2a"/ractice *ecause it a*uses court
4o c)ec$ t)is /ernicious /ractice, Section G, Ru"e A of t)e
<EEA Ru"es of Ci3i" &rocedure reIuires t)e /rinci/a" /art in an
initiator /"eading to su*2it a certi5cation against foru2-
!ai"ure to co2/" #it) t)is reIuire2ent is a cause for t)e
dis2issa" of t)e case and, in case of #i""fu" foru2-s)o//ing, for t)e
i2/osition of ad2inistrati3e sanctions.
Here, Microsoft correct" contends t)at it is not "ia*"e for foru2-
s)o//ing. ;)at Microsoft a//ea"ed in CA-V.R. C[ No. G>J@@ #ere t)e
R4C Orders /artia"" Iuas)ing Searc) ;arrant Nos. EG-JB> and EG-JBG.
In t)e /resent case, Microsoft is a//ea"ing fro2 t)e .OJ Reso"utions
dis2issing its co2/"aint against res/ondents for co/rig)t
infringe2ent and unfair co2/etition. 4)us, a"t)oug) t)e /arties in CA-
V.R. C[ No. G>J@@ and t)is /etition are identica", t)e rig)ts asserted
and t)e re"iefs /raed for are not suc) t)at t)e 6udg2ent in CA-V.R.
C[ No. G>J@@ does not a2ount to res =udicata in t)e /resent case.
4)is renders foru2-s)o//ing i2/ossi*"e )ere.
The DOJ Acted ith !ra"e A#use of Discretion
in not Finding $ro#a#%e Cause to Charge &espondents ith
Cop'right (nfringement and )nfair Competition
&age 16 of /*
Venera"", t)is Court is "oat) to interfere in t)e /rosecutorWs discretion
in deter2ining /ro*a*"e cause
^ un"ess suc) discretion is s)o#n to
)a3e *een a*used.
4)is case fa""s under t)e eLce/tion.
7n"i$e t)e )ig)er Iuantu2 of /roof *eond reasona*"e dou*t reIuired
to secure a con3iction, it is t)e "o#er standard of /ro*a*"e cause #)ic)
is a//"ied during t)e /re"i2inar in3estigation to deter2ine #)et)er
t)e accused s)ou"d *e )e"d for tria". 4)is standard is 2et if t)e facts
and circu2stances incite a reasona*"e *e"ief t)at t)e act or o2ission
co2/"ained of constitutes t)e o,ense c)arged. As #e eL/"ained
in $i%api% ". Sandigan#a'an:
4)e ter2 O/ro*a*"e causeP does not 2ean Zactua" and /ositi3e causeZ
nor does it i2/ort a*so"ute certaint. It is 2ere" *ased on o/inion and
reasona*"e *e"ief. 4)us, a 5nding of /ro*a*"e cause does not reIuire
an inIuir into #)et)er t)ere is suTcient e3idence to /rocure a
con3iction. It is enoug) t)at it is *e"ie3ed t)at t)e act or o2ission
co2/"ained of constitutes t)e o,ense c)arged. &recise", t)ere is a
tria" for t)e rece/tion of e3idence of t)e /rosecution in su//ort of t)e
$D *+ and Artic%e ,-+.,/
Section G
of &. >E %ZSection GZ+ enu2erates t)e rig)ts 3ested
eLc"usi3e" on t)e co/rig)t o#ner. Contrar to t)e .OJWs ru"ing, t)e
gra3a2en of co/rig)t infringe2ent is not 2ere" t)e unaut)ori1ed
Z2anufacturingZ of inte""ectua" #or$s *ut rat)er t)e unaut)ori1ed
/erfor2ance of an of t)e acts co3ered * Section G. Hence, an
/erson #)o /erfor2s an of t)e acts under Section G #it)out
o*taining t)e co/rig)t o#nerWs /rior consent renders )i2se"f
and cri2ina""
"ia*"e for co/rig)t infringe2ent. ;e )e"d
in Co%um#ia $ictures, (nc. ". Court of Appea%s:
Infringe2ent of a co/rig)t is a tres/ass on a /ri3ate do2ain o#ned
and occu/ied * t)e o#ner of t)e co/rig)t, and, t)erefore, /rotected
* "a#, and infringe2ent of co/rig)t, or /irac, #)ic) is a
snon2ous ter2 in t)is connection, consists in t)e doing * an
/erson, #it)out t)e consent of t)e o#ner of t)e co/rig)t, of ant)ing
t)e so"e rig)t to do #)ic) is conferred * statute on t)e o#ner of t)e
co/rig)t. %E2/)asis su//"ied+
Signi5cant", under Section G%A+, a co/rig)t o#ner is 3ested #it) t)e
eLc"usi3e rig)t to Zco/, distri*ute, 2u"ti/", OandP se""Z )is inte""ectua"
On t)e ot)er )and, t)e e"e2ents of unfair co2/etition under Artic"e
of t)e Re3ised &ena" Code are:
%a+ 4)at t)e o,ender gi3es )is goods t)e genera"
a//earance of t)e goods of anot)er 2anufacturer or dea"erK
%*+ 4)at t)e genera" a//earance is s)o#n in t)e %<+ goods
t)e2se"3es, or in t)e %D+ #ra//ing of t)eir /ac$ages, or in t)e
%C+ de3ice or #ords t)erein, or in %>+ an ot)er feature of t)eir
%c+ 4)at t)e o,ender o,ers to se"" or se""s t)ose goods or gi3es
ot)er /ersons a c)ance or o//ortunit to do t)e sa2e #it) a
"i$e /ur/oseOK andP
%d+ 4)at t)ere is actua" intent to decei3e t)e /u*"ic or defraud
a co2/etitor.
4)e e"e2ent of intent to decei3e 2a *e inferred fro2 t)e si2i"arit of
t)e goods or t)eir a//earance.
On the Su0cienc' of E"idence to
Support a Finding of $ro#a#%e Cause
Against &espondents
In its /"eadings 5"ed #it) t)e .OJ, Microsoft in3o$ed t)ree c"usters of
e3idence to su//ort its co2/"aint against res/ondents, na2e": %<+ t)e
<D C.-ROMs containing Microsoft soft#are Sacri1 and Sa2iano *oug)t
fro2 res/ondentsK %D+ t)e C&7 #it) /re-insta""ed Microsoft soft#are
Sacri1 and Sa2iano a"so /urc)ased fro2 res/ondentsK and %C+ t)e
D,BC< C.-ROMs containing Microsoft soft#are sei1ed fro2
4)e .OJ, on t)e one )and, refused to /ass u/on t)e
re"e3ance of t)ese /ieces of e3idence *ecause: %<+ t)e Zo*"igations
*et#een t)e /arties is ci3i" and not cri2ina"Z considering t)at
Microsoft 2ere" soug)t t)e issuance of Searc) ;arrant Nos. EG-JB>
and EG-JBG to /ressure Be"tron to /a its o*"igation under t)e
Agree2ent, and %D+ t)e 3a"idit of MicrosoftWs ter2ination of t)e
Agree2ent 2ust 5rst *e reso"3ed * t)e Z/ro/er court.Z On t)e ot)er
)and, t)e .OJ ru"ed t)at Microsoft fai"ed to /resent e3idence /ro3ing
t)at #)at #ere o*tained fro2 res/ondents #ere counterfeit Microsoft
4)is is gra3e a*use of discretion.
&age 1< of /*
#irst. Being t)e co/rig)t and trade2ar$ o#ner of Microsoft
soft#are, Microsoft acted #e"" #it)in its rig)ts in 5"ing t)e
co2/"aint under I.S. No. EJ-<EC *ased on t)e incri2inating
e3idence o*tained fro2 res/ondents. Hence, it #as )ig)"
irregu"ar for t)e .OJ to )o"d, *ased on t)e R4C Order of <E Ju"
<EEJ, t)at Microsoft soug)t t)e issuance of Searc) ;arrant
Nos. EG-JB> and EG-JBG, and * inference, t)e 5"ing of t)e
co2/"aint under I.S. No. EJ-<EC, 2ere" to /ressure Be"tron to
/a its o3erdue roa"ties to Microsoft. Signi5cant", in its
.ecision in CA-V.R. C[ No. G>J@@ dated DE No3e2*er D@@<,
t)e Court of A//ea"s set aside t)e R4C Order of <E Ju" <EEJ.
Res/ondents no "onger contested t)at ru"ing #)ic) *eca2e
5na" on DA .ece2*er D@@<.
Second. 4)ere is no *asis for t)e .OJ to ru"e t)at Microsoft
2ust a#ait a /rior Zreso"ution fro2 t)e /ro/er court of %sic+
#)et)er or not t)e OAgree2entP is sti"" *inding *et#een t)e
/arties.Z Be"tron )as not 5"ed an suit to Iuestion MicrosoftWs
ter2ination of t)e Agree2ent. Microsoft can neit)er *e
eL/ected nor co2/e""ed to #ait unti" Be"tron decides to sue
*efore Microsoft can see$ re2edies for 3io"ation of its
inte""ectua" /ro/ert rig)ts.
!urt)er2ore, so2e of t)e counterfeit C.-ROMs *oug)t fro2
res/ondents #ere Zinsta""erZ C.-ROMs containing Microsoft
soft#are on" or *ot) Microsoft and non-Microsoft soft#are.
4)ese artic"es are counterfeit per se *ecause Microsoft does
not %and cou"d not )a3e aut)ori1ed anone to+ /roduce suc)
C.-ROMs. 4)e co/ing of t)e genuine Microsoft soft#are to
/roduce t)ese fa$e C.-ROMs and t)eir distri*ution are i""ega"
e3en if t)e co/ier or distri*utor is a Microsoft "icensee. As far
as t)ese insta""er C.-ROMs are concerned, t)e Agree2ent
%and t)e a""eged Iuestion on t)e 3a"idit of its ter2ination+ is
i22ateria" to t)e deter2ination of res/ondentsW "ia*i"it for
co/rig)t infringe2ent and unfair co2/etition.
0ast", Section <@%*+
of t)e Agree2ent /ro3ides t)at
MicrosoftWs Zrig)ts and re2ediesZ under t)e contract are Znot
LLL eLc"usi3e and are in addition to an ot)er rig)ts and
re2edies /ro3ided * "a# or Ot)eP Agree2ent.Z 4)us, e3en if
t)e Agree2ent sti"" su*sists, Microsoft is not /rec"uded fro2
see$ing re2edies under &. >E and Artic"e <BE%<+ of t)e
Re3ised &ena" Code to 3indicate its rig)ts.
Third. 4)e Court 5nds t)at t)e <D C.-ROMs %Zinsta""erZ and
Znon-insta""erZ+ and t)e C&7 #it) /re-insta""ed Microsoft
soft#are Sacri1 and Sa2iano *oug)t fro2 res/ondents and t)e
D,BC< Microsoft C.-ROMs sei1ed fro2 res/ondents suTce to
su//ort a 5nding of /ro*a*"e cause to indict res/ondents for
co/rig)t infringe2ent under Section G%A+ in re"ation to
Section DE of &. >E for unaut)ori1ed co/ing and se""ing of
/rotected inte""ectua" #or$s. 4)e insta""er C.-ROMs #it)
Microsoft soft#are, to re/eat, are counterfeit per se. On t)e
ot)er )and, t)e i""ega"it of t)e Znon-insta""erZ C.-ROMs
/urc)ased fro2 res/ondents and of t)e Microsoft soft#are /re-
insta""ed in t)e C&7 is s)o#n * t)e a*sence of t)e standard
features acco2/aning aut)entic Microsoft /roducts, na2e",
t)e Microsoft end-user "icense agree2ents, userWs 2anua"s,
registration cards or certi5cates of aut)enticit.
On t)e D,BC< Microsoft C.-ROMs
sei1ed fro2 res/ondents,
res/ondent Be"tron, t)e on" res/ondent #)o #as /art to t)e
Agree2ent, cou"d not )a3e re/roduced t)e2 under t)e Agree2ent as
t)e So"icitor Venera"
and res/ondents contend. Be"tronWs
under t)e Agree2ent #ere "i2ited to:
%<+ t)e Zre/roducOtionP and insta""Oation ofP no 2ore t)an one
cop( of OMicrosoftP soft#are on eac) Custo2er Sste2 )ard
dis$ or Read On" Me2or %ZROMZ+ZK and
%D+ t)e Zdistri*utOionP LLL and "icensOing ofP co/ies of t)e
OMicrosoftP &roduct Las reproduced a'o!eM andKor
acBuired from Aut"oriNed #eplicator or Aut"oriNed
istri'utor: in o'@ect code form to end users.Z
4)e Agree2ent de5nes an aut)ori1ed re/"icator as Za t)ird /art
a//ro3ed * OMicrosoftP #)ic) 2a re/roduce and 2anufacture
OMicrosoftP &roductOsP for OBe"tronP LLL.Z
An aut)ori1ed distri*utor, on
t)e ot)er )and, is a Zt)ird /art a//ro3ed * OMicrosoftP fro2 #)ic)
OBe"tronP 2a /urc)ase ME.
Being a 2ere
re/roducerYinsta""er of one Microsoft soft#are co/ on eac) custo2erWs
)ard dis$ or ROM, Be"tron cou"d on" )a3e acIuired t)e )undreds of
Microsoft C.-ROMs found in res/ondentsW /ossession fro2 Microsoft
distri*utors or re/"icators.
Ho#e3er, res/ondents 2a$es no suc) c"ai2. ;)at res/ondents
contend is t)at t)ese C.-ROMs #ere "eft to t)e2 for safe$ee/ing. But
neit)er is t)is c"ai2 tena*"e for "ac$ of su*stantiation. Indeed,
res/ondents 'e) and C)ua, t)e on" res/ondents #)o 5"ed counter-
aTda3its, did not 2a$e t)is c"ai2 in t)e .OJ. 4)ese circu2stances
gi3e rise to t)e reasona*"e inference t)at res/ondents 2ass-/roduced
t)e C.-ROMs in Iuestion #it)out securing MicrosoftWs /rior
&age 1+ of /*
4)e counterfeit Znon-insta""erZ C.-ROMs Sacri1 and Sa2iano *oug)t
fro2 res/ondents a"so suTce to su//ort a 5nding of /ro*a*"e cause to
indict res/ondents for unfair co2/etition under Artic"e <BE%<+ of t)e
Re3ised &ena" Code for /assing o, Microsoft /roducts. !ro2 t)e
/ictures of t)e C.-ROMsW /ac$aging,
one cannot distinguis) t)e2
fro2 t)e /ac$aging of C.-ROMs containing genuine Microsoft
soft#are. Suc) re/"ication, cou/"ed #it) t)e si2i"arit of content of
t)ese fa$e C.-ROMs and t)e C.-ROMs #it) genuine Microsoft
soft#are, i2/"ies intent to decei3e.
Res/ondentsW contention t)at t)e <D C.-ROMs Sacri1 and Sa2iano
/urc)ased cannot *e traced to t)e2 *ecause t)e recei/t for t)ese
artic"es does not indicate its source is una3ai"ing. 4)e recei/t in
Iuestion s)ou"d *e ta$en toget)er #it) MicrosoftWs c"ai2 t)at Sacri1
and Sa2iano *oug)t t)e C.-ROMs fro2 res/ondents.
4oget)er, t)ese
considerations /oint to res/ondents as t)e 3endor of t)e counterfeit
C.-ROMs. Res/ondents do not gi3e an reason #) t)e Court s)ou"d
not gi3e credence to MicrosoftWs c"ai2. !or t)e sa2e reason, t)e fact
t)at t)e recei/t for t)e C&7 does not indicate ZOsPoft#are )ard dis$Z
does not 2ean t)at t)e C&7 )ad no /re-insta""ed Microsoft soft#are.
Res/ondents 'e) and C)ua ad2it in t)eir counter-aTda3it t)at
res/ondents are t)e ZsourceZ of t)e /re-insta""ed MS-.OS soft#are.
)9$#$EO#$, #e VRAN4 t)e /etition. ;e SE4 ASI.E t)e Reso"utions
dated DJ Octo*er <EEE, C .ece2*er <EEE, C August D@@@, and DD
.ece2*er D@@@ of t)e .e/art2ent of Justice.
4.#. No. *6,156 Septem'er 05, 055,
%ANL& SPO#T)$A# %ANUEACTU#IN4, INC., &etitioners,
C$NT$#, Res/ondent.
4)is /etition for re3ie# on certiorari
under Ru"e >G of t)e Re3ised
Ru"es of Ci3i" &rocedure assai"s t)e Ju" <C, D@@> decision
of t)e Court
of A//ea"s
in CA-V.R. S& No. AEBBA and its Se/te2*er <G, D@@>
dening reconsideration t)ereof.
4)e facts are as fo""o#s:
On Marc) <>, D@@C, S/ecia" In3estigator E"ie1er &. Sa"cedo of t)e
Nationa" Bureau of In3estigation %NBI+ a//"ied for a searc) #arrant
*efore t)e Regiona" 4ria" Court %R4C+ of Rue1on Cit, *ased on t)e
infor2ation t)at .adodette Enter/rises andYor Her2es S/orts Center
#ere in /ossession of goods, t)e co/rig)t of #)ic) *e"onged to Man"
S/orts#ear Mfg., Inc. %MAN0Y+.
After 5nding reasona*"e grounds t)at a 3io"ation of Sections <AD and
D<A of Re/u*"ic Act %RA+ No. BDEC
)as *een co22itted, Judge Estre""a
4. Estrada of R4C-Rue1on Cit, Branc) BC, issued on Marc) <A, D@@C
Searc) ;arrant No. >@>>%@C+.
Res/ondents t)ereafter 2o3ed to Iuas) and annu" t)e searc) #arrant
contending t)at t)e sa2e is in3a"id since t)e reIuisites for its issuance
)a3e not *een co2/"ied #it). 4)e insisted t)at t)e s/orting goods
2anufactured * andYor registered in t)e na2e of MAN0Y are ordinar
and co22on )ence, not a2ong t)e c"asses of #or$ /rotected under
Section <AD of RA BDEC.
On June <@, D@@C, t)e tria" court granted t)e 2otion to Iuas) and
dec"ared Searc) ;arrant No. >@>>%@C+ nu"" and 3oid *ased on its
5nding t)at t)e co/rig)ted /roducts of MAN0Y do not a//ear to *e
origina" creations and #ere *eing 2anufactured and distri*uted *
di,erent co2/anies "oca"" and a*road under 3arious *rands, and
t)erefore unIua"i5ed for /rotection under Section <AD of RA BDEC.
Moreo3er, MAN0YWs certi5cates of registrations #ere issued on" in
D@@D, #)ereas t)ere #ere certi5cates of registrations for t)e sa2e
s/orts artic"es #)ic) #ere issued ear"ier t)an MAN0YWs, t)us furt)er
negating t)e c"ai2 t)at its co/rig)ted /roducts #ere origina"
On August <<, D@@C, t)e tria" court denied
MAN0YWs 2otion for
reconsideration. Hence it 5"ed a /etition for certiorari
*efore t)e
Court of A//ea"s #)ic) #as denied for "ac$ of 2erit. 4)e a//e""ate
court found t)at t)e tria" court correct" granted t)e 2otion to Iuas)
and t)at its ru"ing in t)e anci""ar /roceeding did not /ree2/t t)e
5ndings of t)e inte""ectua" /ro/ert court as it did not reso"3e #it)
5na"it t)e status or c)aracter of t)e sei1ed ite2s.
After denia" of its 2otion for reconsideration on Se/te2*er <G, D@@>,
MAN0Y 5"ed t)e instant /etition for re3ie# on certiorari raising t)e so"e
&age 1. of /*
issue of #)et)er or not t)e Court of A//ea"s erred in 5nding t)at t)e
tria" court did not gra3e" a*use its discretion in dec"aring in t)e
)earing for t)e Iuas)a" of t)e searc) #arrant t)at t)e co/rig)ted
/roducts of MAN0Y are not origina" creations su*6ect to t)e /rotection
;e den t)e /etition.
4)e /o#er to issue searc) #arrants is eLc"usi3e" 3ested #it) t)e tria"
6udges in t)e eLercise of t)eir 6udicia" function.
As suc), t)e /o#er to
Iuas) t)e sa2e a"so rests so"e" #it) t)e2. After t)e 6udge )as issued
a #arrant, )e is not /rec"uded to su*seIuent" Iuas) t)e sa2e, if )e
5nds u/on ree3a"uation of t)e e3idence t)at no /ro*a*"e cause eLists.
Our ru"ing in Solid Triangle Sales Corp. v. Sheri/! 3TC! B.C.! Br. 9C
instructi3e, t)us:
In)erent in t)e courtsW /o#er to issue searc) #arrants is t)e /o#er to
Iuas) #arrants a"read issued. In t)is connection, t)is Court )as ru"ed
t)at t)e 2otion to Iuas) s)ou"d *e 5"ed in t)e court t)at issued t)e
#arrant un"ess a cri2ina" case )as a"read *een instituted in anot)er
court, in #)ic) case, t)e 2otion s)ou"d *e 5"ed #it) t)e "atter. 4)e
ru"ing )as since *een incor/orated in Ru"e <DJ of t)e Re3ised Ru"es of
Cri2ina" &rocedureO.P
In t)e instant case, #e 5nd t)at t)e tria" court did not a*use its
discretion #)en it entertained t)e 2otion to Iuas) considering t)at no
cri2ina" action )as et *een instituted #)en it #as 5"ed. 4)e tria"
court a"so /ro/er" Iuas)ed t)e searc) #arrant it ear"ier issued after
5nding u/on ree3a"uation of t)e e3idence t)at no /ro*a*"e cause
eLists to 6ustif its issuance in t)e 5rst /"ace. As ru"ed * t)e tria"
court, t)e co/rig)ted /roducts do not a//ear to *e origina" creations
of MAN0Y and are not a2ong t)e c"asses of #or$ enu2erated under
Section <AD of RA BDEC. 4)e tria" court, t)us, 2a not *e fau"ted for
o3erturning its initia" assess2ent t)at t)ere #as /ro*a*"e cause in
3ie# of its in)erent /o#er to issue searc) #arrants and to Iuas) t)e
sa2e. No o*6ection 2a *e 3a"id" /osed to an order Iuas)ing a
#arrant a"read issued as t)e court 2ust *e /ro3ided #it) t)e
o//ortunit to correct itse"f of an error un#itting" co22itted, or, #it)
"i$e e,ect, to a""o# t)e aggrie3ed /art t)e c)ance to con3ince t)e
court t)at its ru"ing is erroneous.
Moreo3er, t)e tria" court #as acting #it)in *ounds #)en it ru"ed, in an
anci""ar /roceeding, t)at t)e co/rig)ted /roducts of /etitioner are
not origina" creations. 4)is is *ecause in t)e deter2ination of t)e
eListence of /ro*a*"e cause for t)e issuance or Iuas)a" of a #arrant, it
is ine3ita*"e t)at t)e court 2a touc) on issues /ro/er" t)res)ed out
in a regu"ar /roceeding. In so doing, it does not usur/ t)e /o#er of,
2uc) "ess /rec"ude, t)e court fro2 2a$ing a 5na" 6udicia"
deter2ination of t)e issues in a fu""-*"o#n tria". ConseIuent", MAN0YWs
assertion t)at t)e tria" courtWs order Iuas)ing t)e #arrant /ree2/ted
t)e 5nding of t)e inte""ectua" /ro/ert court )as no "ega" *asis.
As /ertinent" )e"d in Solid Triangle Sales Corp. v. Sheri/! 3TC! B.C.!
Br. 9C:
;)en t)e court, in deter2ining /ro*a*"e cause for issuing or Iuas)ing
a searc) #arrant, 5nds t)at no o,ense )as *een co22itted, it does
not interfere #it) or encroac) u/on t)e /roceedings in t)e /re"i2inar
in3estigation. 4)e court does not o*"ige t)e in3estigating oTcer not to
5"e an infor2ation for t)e courtWs ru"ing t)at no cri2e eLists is on" for
/ur/oses of issuing or Iuas)ing t)e #arrant. 4)is does not, as
/etitioners #ou"d "i$e to *e"ie3e, constitute a usur/ation of t)e
eLecuti3e function. Indeed, to s)ir$ fro2 t)is dut #ou"d a2ount to an
a*dication of a constitutiona" o*"igation.
... 4)e 5nding * t)e court t)at no cri2e eLists does not /rec"ude t)e
aut)ori1ed oTcer conducting t)e /re"i2inar in3estigation fro2
2a$ing )is o#n deter2ination t)at a cri2e )as *een co22itted and
t)at /ro*a*"e cause eLists for /ur/oses of 5"ing t)e infor2ation.
As correct" o*ser3ed * t)e Court of A//ea"s, t)e tria" courtWs 5nding
t)at t)e sei1ed /roducts are not co/rig)ta*"e #as 2ere" /re"i2inar
as it did not 5na"" and /er2anent" ad6udicate on t)e status and
c)aracter of t)e sei1ed ite2s. MAN0Y cou"d sti"" 5"e a se/arate
co/rig)t infringe2ent suit against t)e res/ondents *ecause t)e order
for t)e issuance or Iuas)a" of a #arrant is not res =udicata.
4)us, in Dlasons ?nterprises Corporation v. Court o% Appeals
#e )e"d
4)e /roceeding for t)e sei1ure of /ro/ert in 3irtue of a searc) #arrant
does not end #it) t)e actua" ta$ing of t)e /ro/ert * t)e /ro/er
oTcers and its de"i3er, usua"" constructi3e, to t)e court. 4)e order
for t)e issuance of t)e #arrant is not a 5na" one and cannot
constitute res =udicata. Suc) an order does not ascertain and
ad6udicate t)e /er2anent status or c)aracter of t)e sei1ed /ro/ert.
B its 3er nature, it is /ro3isiona", inter"ocutor. It is 2ere" t)e 5rst
ste/ in t)e /rocess to deter2ine t)e c)aracter and tit"e of t)e
/ro/ert. 4)at deter2ination is done in t)e cri2ina" action in3o"3ing
&age /5 of /*
t)e cri2e or cri2es in connection #it) #)ic) t)e searc) #arrant #as
issued. Hence, suc) a cri2ina" action s)ou"d *e /rosecuted, or
co22enced if not et instituted, and /rosecuted. 4)e outco2e of t)e
cri2ina" action #i"" dictate t)e dis/osition of t)e sei1ed /ro/ert`
;e )a3e a"so ru"ed in Ching v. Salinas! Sr.! et al.
4)e R4C )ad 6urisdiction to de"3e into and reso"3e t)e issue #)et)er
t)e /etitionerWs uti"it 2ode"s are co/rig)ta*"e and, if so, #)et)er )e
is t)e o#ner of a co/rig)t o3er t)e said 2ode"s. It *ears stressing
t)at u/on t)e 5"ing of t)e a//"ication for searc) #arrant, t)e R4C #as
dut-*ound to deter2ine #)et)er /ro*a*"e cause eListed, in
accordance #it) Section >, Ru"e <DJ of t)e Ru"es of Cri2ina"
!urt)er, t)e co/rig)t certi5cates issued in fa3or of MAN0Y constitute
2ere" prima %acie e3idence of 3a"idit and o#ners)i/. Ho#e3er, no
/resu2/tion of 3a"idit is created #)ere ot)er e3idence eList t)at 2a
cast dou*t on t)e co/rig)t 3a"idit. Hence, #)ere t)ere is suTcient
/roof t)at t)e co/rig)ted /roducts are not origina" creations *ut are
readi" a3ai"a*"e in t)e 2ar$et under 3arious *rands, as in t)is case,
3a"idit and origina"it #i"" not *e /resu2ed and t)e tria" court 2a
/ro/er" Iuas) t)e issued #arrant for "ac$ of /ro*a*"e cause.
Besides, no co/rig)t accrues in fa3or of MAN0Y des/ite issuance of
t)e certi5cates of registration and de/osit
/ursuant to Section D, Ru"e
A of t)e Co/rig)ts Safeguards and Regu"ations
#)ic) states:
Sec. D E,ects of Registration and .e/osit of ;or$. 4)e registration and
de/osit of t)e #or$ is /ure" for recording t)e date of registration and
de/osit of t)e #or$ and s)a"" not *e conc"usi3e as to co/rig)t
o#ners)i/ or t)e ter2 of t)e co/rig)ts or t)e rig)ts of t)e co/rig)t
o#ner, inc"uding neig)*oring rig)ts.
At 2ost, t)e certi5cates of registration and de/osit issued * t)e
Nationa" 0i*rar and t)e Su/re2e Court 0i*rar ser3e 2ere" as a
notice of recording and registration of t)e #or$ *ut do not confer an
rig)t or tit"e u/on t)e registered co/rig)t o#ner or auto2atica"" /ut
)is #or$ under t)e /rotecti3e 2ant"e of t)e co/rig)t "a#. It is not a
conc"usi3e /roof of co/rig)t o#ners)i/. As it is, non-registration and
de/osit of t)e #or$ #it)in t)e /rescri*ed /eriod on" 2a$es t)e
co/rig)t o#ner "ia*"e to /a a 5ne.
)9$#$EO#$, t)e /etition is $NI$. 4)e Ju" <C, D@@> decision of
t)e Court of A//ea"s in CA-V.R. S& No. AEBBA and reso"ution dated
Se/te2*er <G, D@@>, are AEEI#%$.
SO O#$#$.
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