G.R. Nos. 175769-70. January 19, 2009.
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ABS-CBN BROADCASTING CORPORATION, petitioner, vs. PHILIPPINE MULTI-MEDIA SYSTEM,
INC., CESAR G. REYES, FRANCIS CHUA (ANG BIAO), MANUEL F. ABELLADA, RAUL B. DE MESA,
AND ALOYSIUS M. COLAYCO, respondents.
Petitioner ABS-CBN Broadcasting Corporation (ABS-CBN) is licensed under the laws of the Republic of
the Philippines to engage in television and radio broadcasting
ABS-CBN also owns regional television stations which pattern their programming in accordance
with perceived demands of the region. Thus, television programs shown in Metro Manila and nearby
provinces are not necessarily shown in other provinces.
Respondent Philippine Multi-Media System, Inc. (PMSI) is the operator of Dream Broadcasting
System. It delivers digital direct-to-home (DTH) television via satellite to its subscribers all over the
Philippines. Herein individual respondents are members of PMSI’s Board of Directors.
PMSI was granted a legislative franchise under Republic Act No. 86305
When it commenced operations, it offered as part of its program line-up ABS-CBN Channels 2 and
23, NBN, Channel 4, ABC Channel 5, GMA Channel 7, RPN Channel 9, and IBC Channel 13,
ABS-CBN demanded for PMSI to cease and desist from rebroadcasting Channels 2 and 23 . On
April 27, 2001,7 PMSI replied that the rebroadcasting was in accordance with the authority granted it by
NTC
negotiations ensued between the parties in an effort to reach a settlement; however, the negotiations
were terminated
ABS-CBN filed with the IPO a complaint for “Violation of Laws Involving Property Rights, with
Prayer for the Issuance of a Temporary Restraining Order, It alleged that PMSI’s unauthorized
rebroadcasting of Channels 2 and 23 infringed on its broadcasting rights and copyright, BLA) of the
IPO granted ABS-CBN’s application for a temporary restraining order.
Subsequently, PMSI filed with the BLA a Manifestation reiterating that it is subject to the must-carry
rule under Memorandum Circular No. 04-08-88
PMSI filed another Manifestation with the BLA that it received a letter dated July 24, 2003 from the NTC
enjoining strict and immediate compliance with the must-carry rule under Memorandum Circular No. 04-
08-88
On December 22, 2003, the BLA rendered a decision14finding that PMSI infringed the
broadcasting rights and copyright of ABS-CBN and ordering it to permanently cease and desist from
rebroadcasting Channels 2 and 23.
PMSI filed an appeal with the Office of the Director-General of the IPO, the Director-General of the IPO
rendered a decision15 in favor of PMSI
Thus, ABS-CBN filed a petition for review with prayer for issuance of a temporary restraining order and
writ of preliminary injunction with the Court of Appeals
the Court of Appeals sustained the findings of the Director-General of the IPO and dismissed
both petitions filed by ABS-CBN.17
WHETHER PMSI COMMITTED INFRINGEMENT OF ABS CBN’S COPYRIGHT- NO
WHETHER PMSI ENGAGED IN REBROADCASTING ABS-CBN CHANNELS- NO
ABS-CBN contends that PMSI’s unauthorized rebroadcasting of Channels 2 and 23 is an infringement of
its broadcasting rights and copyright under the Intellectual Property Code
Respondents, on the other hand, argue that PMSI’s rebroadcasting of Channels 2 and 23 is sanctioned
by Memorandum Circular No. 04-08-88;
we affirm the findings of the Director-General of the IPO and the Court of Appeals.
There is no merit in ABS-CBN’s contention that PMSI violated its broadcaster’s rights under Section
211 of the IP Code which provides in part:
Chapter XIV
BROADCASTING ORGANIZATIONS
Sec. 211. Scope of Right.—Subject to the provisions of Section 212, broadcasting organizations
shall enjoy the exclusive right to carry out, authorize or prevent any of the following acts:
211.1. The rebroadcasting of their broadcasts;
x x x x
Neither is PMSI guilty of infringement of ABS-CBN’s copyright under Section 177 of the IP Code which
states that copyright or economic rights shall consist of the exclusive right to carry out, authorize or
prevent the public performance of the work (Section 177.6), and other communication to the public of the
work (Section 177.7).20
Section 202.7 of the IP Code defines broadcasting as “the transmission by wireless means for the
public reception of sounds or of images or of representations thereof
On the other hand, rebroadcasting 21 is “the simultaneous broadcasting by one broadcasting
organization of the broadcast of another broadcasting organization.”(A FORM OF INFRINGEMENT)
The Director-General of the IPO correctly found that PMSI is not engaged in rebroadcasting and thus
cannot be considered to have infringed ABS-CBN’s broadcasting rights and copyright,
Appellant’s DTH satellite television service must be examined since it is satellite-based. The elements
of such category are as follows:
1. There is transmission of sounds or images or of representations thereof;
2. The transmission is through satellite;
3. The transmission is for public reception; and
4. The means for decrypting are provided to the public by the broadcasting organization or with its
consent.
It is only the presence of all the above elements can a determination that the DTH is broadcasting and
consequently, rebroadcasting Appellee’s signals in violation of Sections 211 and 177 of the IP Code, may
be arrived at.
Accordingly, this Office is of the view that the transmission contemplated under Section 202.7 of
the IP Code presupposes that the origin of the signals is the broadcaster. Hence, a program that is
broadcasted is attributed to the broadcaster. In the same manner, the rebroadcasted program is
attributed to the rebroadcaster.
In the case at hand, Appellant PMSI is not the origin nor does it claim to be the origin of the
programs broadcasted by the Appellee. Appellant did not make and transmit on its own but merely
carried the existing signals of the Appellee ABS CBN. When Appellant’s subscribers view Appellee’s
programs in Channels 2 and 23, they know that the origin thereof was the Appellee.
Aptly, it is imperative to discern the nature of broadcasting. When a broadcaster transmits, the signals are
scattered or dispersed in the air. Anybody may pick-up these signals. There is no restriction as to its
number, type or class of recipients. To receive the signals, one is not required to subscribe or to pay any
fee.
ABS-CBN creates and transmits its own signals; PMSI merely carries such signals which the viewers
receive in its unaltered form. PMSI does not produce, select, or determine the programs to be
shown in Channels 2 and 23. Likewise, it does not pass itself off as the origin or author of such
programs
Indeed, intellectual property protection is merely a means towards the end of making society benefit
from the creation of its men and women of talent and genius. This is the essence of intellectual property
laws, and it explains why certain products of ingenuity that are concealed from the public are outside the
pale of protection afforded by the law. It also explains why the author or the creator enjoys no more rights
than are consistent with public welfare.31
There is likewise no merit to ABS-CBN’s claim that PMSI’s carriage of its signals is for a commercial
purpose; that its being the country’s top broadcasting company, the availability of its signals allegedly
enhances PMSI’s attractiveness to potential customers; 38 or that the unauthorized carriage of its signals
by PMSI has created competition between its Metro Manila and regional stations.
ABS-CBN presented no substantial evidence to prove that PMSI carried its signals for profit; or
that such carriage adversely affected the business operations of its regional stations
Anyone in the country who owns a television set and antenna can receive ABS-CBN’s signals for free.
Other broadcasting organizations with free-to-air signals such as GMA-7, RPN-9, ABC-5, and IBC-13 can
likewise be accessed for free
In contrast, cable and DTH television earn revenues from viewer subscription. In the case of PMSI, it
offers its customers premium paid channels from content providers like Star Movies, Star World, Jack TV,
and AXN, among others
All told, we find that the Court of Appeals correctly upheld the decision of the IPO Director-General
that PMSI did not infringe on ABS-CBN’s intellectual property rights under the IP Code. The findings of
facts of administrative bodies charged with their specific field of expertise, are afforded great weight by
the courts, and in the absence of substantial showing that such findings are made from an erroneous
estimation of the evidence presented, they are conclusive, and in the interest of stability of the
governmental structure, should not be disturbed.47
