Title
GMA Network, Inc. vs. ABC Development Corp.
Case
G.R. No. 205986
Decision Date
Jan 11, 2023
GMA and Citynet challenged ABC-5's Blocktime Agreement with Primedia, alleging foreign control of mass media. Courts dismissed due to primary jurisdiction, exhaustion of remedies, and forum shopping non-compliance.

Case Summary (G.R. No. 205986)

Emergence of the ABC-5 Blocktime Agreement

In early 2008, reports surfaced that ABC-5 had sold nearly all its airtime to Primedia—allegedly a Philippine subsidiary 70% owned by Malaysian investor MPB—retaining only news and Christian programming. Primedia planned to transfer its blocktime rights to the MPB Strategic Media Fund.

Alleged Violations and Complaint Filed

On December 3, 2008, GMA, Citynet, and ZBNI filed a Complaint in the Quezon City RTC seeking to:

  1. Declare the ABC-5–Primedia blocktime agreement void ab initio for violating mass-media ownership limits (1987 Constitution, Art. XVI, Sec. 11[1]) and the Anti-Dummy Law.
  2. Declare that 93.75% of TV-5’s airtime was under Primedia’s control, causing unfair competition under Civil Code Article 28.
  3. Award actual, exemplary, attorney’s fees, and litigation expenses.

Procedural Course in the RTC

Respondents moved to dismiss for lack of jurisdiction and improper service; petitioners filed an erratum and later an amended complaint. The RTC denied production motions, ordered filing of an amended complaint, then dismissed the action on grounds that:
• The dispute should first be referred to the NTC under its regulatory and competition-maintenance powers (EO 546, Sec. 15[g]).
• Petitioners filed a false certification against forum shopping by not disclosing the letter-complaint previously lodged (and withdrawn) with the NTC.
• Issues touching on the legislative franchise of ABC-5 and Primedia’s corporate status required quo warranto proceedings by the State.

RTC’s Omnibus Order and Joint Dismissal

On April 2, 2009, the RTC directed petitioners to amend their complaint and denied their production motion. On December 15, 2009, the RTC dismissed the amended complaint without prejudice, citing primary jurisdiction of the NTC over technical and competition issues and the forum-shopping certification defect.

Court of Appeals’ Ruling

On October 16, 2012, the Court of Appeals affirmed the RTC’s dismissal, holding that:
• Petitioners failed to exhaust the NTC’s administrative remedies and respect its primary jurisdiction on unfair competition and related regulatory matters.
• No exception to the exhaustion rule applied because the case involved factual inquiries beyond pure questions of law.
• Petitioners also violated the certification-against-forum-shopping requirement.

Issues Presented in the Supreme Court

The petition raised whether the CA erred by:

  1. Requiring NTC resolution of unfair competition issues prior to court adjudication of the blocktime agreement’s constitutionality.
  2. Holding that regular courts lacked subject-matter jurisdiction without administrative referral.
  3. Finding a defective certification against forum shopping.
  4. Treating the action as requiring quo warranto proceedings.

Doctrine of Primary Jurisdiction

The Supreme Court distinguished:
• Exhaustion of administrative remedies (a waivable condition precedent to suit).
• Primary jurisdiction (courts must defer to specialized agencies on technical questions).
Here, adjudicating the blocktime agreement’s factual and technical aspects—mass-media management transfer, competition effects, franchise compliance—fell squarely within the NTC’s special competence under EO 546.

Application of EO 546 and NTC Competence

EO 546 empowers the NTC to regulate broadcasting facilities, promulgate rules for public interest, and “maintain effective competition among private entities.” Assessing whether the blocktime agreement violated constitutional o




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