G.R. No. L-7496 - Caltex Inc. vs. Katipu Labor Union

Philippine Long Distance Telephone Company (PLDT) holds a legislative franchise (RA 7082) to provide basic and enhanced telecommunications services nationwide and internationally; its network includes the Public Switch Telephone Network, subscriber equipment, wires and cables, antennae, transmission facilities, and the International Gateway Facility (IGF).
To combat network fraud, PLDT’s Alternative Calling Patterns Detection Division (ACPDD) conducts investigations and market research abroad on prepaid phone cards that may perpetrate fraud by bypassing PLDT’s IGF via the internet (a practice known as International Simple Resale or ISR).

Test calls using “The Number One” prepaid card at the PLDT-ACPDD office showed incoming caller-ID as PLDT number 2-8243285, subscriber Abigail R. Razon Alvarez; validation tests at the NTC premises confirmed the same.
Similar tests with “Unity Card” and “IDT Supercalling Card” reflected numbers registered to Experto Enterprises and Experto Phils. at 38 Indonesia St., Barangay Don Bosco, Parañaque City—also occupied by Abigail.
PLDT’s investigation revealed that these prepaid cards routed calls over the internet to local PLDT lines, bypassing toll centers and enabling international calls to appear as local.

November 6 and 19, 2003 inspections at 17 Dominic Savio St. uncovered boundary protectors, multi‐layered racks with six Quintum routers, thirteen 3Com routers, one Cisco 800 router, one Nokia DSL modem, one Meridian Subscriber’s Unit with outdoor antenna, five PCs, one printer, and one scanner.
Inspection at 38 Indonesia St. found telephone protectors in wooden cabinets, wiring conduits to a second‐floor room housing similar telecommunications equipment.

On December 3, 2003, PNP Superintendent Cruz filed a consolidated application before RTC Pasay City, Branch 115, seeking four search warrants: two for theft (RPC Arts. 308 & 309) and two for violation of PD 401 (unauthorized telephone connections).
The warrants (03-063 and 03-064, each covering two locations) enumerated nine categories of objects to seize: subscriber units, DSL lines, cables, antennas, PCs, modems, routers, switches, printers, scanners, software, diskettes, tapes, manuals, phone cards, access codes, billing statements, contracts, and related documents.

The PNP executed the four warrants on December 3, 2003; return and inventory filed December 10, 2003.
On January 14, 2004, PLDT and the PNP lodged a joint complaint‐affidavit for theft and PD 401 violations.
Respondents moved to quash on February 18, 2004, contesting jurisdiction, particularity of the warrants, and probable cause for theft; RTC denied the motion (July 6, 2004) and subsequent reconsideration.

Quashed SW A-1 and A-2 (theft warrants) as issued for a “non-existent crime”—relying on the then‐nonfinal Division ruling in Laurel v. Abrogar that telecommunication services are not “personal property” under RPC Art. 308.
Upheld paragraphs 1–6 of SW B-1 and B-2 (PD 401 warrants) but voided paragraphs 7–9 (printers, scanners, software, documents) for lack of particularity.

PLDT filed a Rule 45 petition to: (a) restore SW A-1 and A-2 based on proper standards of probable cause and supervening En Banc ruling in Laurel; and (b) reinstate paragraphs 7–9 of SW B-1/B-2 as items related to PD 401.
Respondents argued the CA correctly applied Laurel (albeit nonfinal) and that the voided paragraphs bore no relation to PD 401’s prohibition.

Are search warrants SW A-1 and A-2, issued for alleged theft (RPC Arts. 308 & 309) valid in light of whether ISR activities constitute theft of “personal property”?
Do paragraphs 7–9 of search warrants SW B-1 and B-2, issued for violation of PD 401, satisfy the constitutional and procedural requirement of particularity and functional nexus to the offense of unauthorized telephone connections?