Case Summary (G.R. No. 166391)
Petitioner
Microsoft Corporation
Respondent
Rolando D. Manansala and/or Mel Manansala, doing business as Dataman Trading Company and/or Comic Alley
Key Dates
• November 3, 1997: Test purchase of six CD-ROMs containing Microsoft software programs.
• November 17–19, 1997: Issuance and execution of search warrant; seizure of illegal copies.
• March 20, 2000: DOJ State Prosecutor dismisses copyright infringement charge under Section 29, P.D. 49.
• May 15, 2001: DOJ denies motion for partial reconsideration.
• January 27, 2003: DOJ denies petition for review.
• February 27, 2004: Court of Appeals denies certiorari petition, affirming DOJ orders.
• October 21, 2015: Supreme Court decision reversing CA and DOJ.
Applicable Law
• 1987 Philippine Constitution (property rights, due process)
• Presidential Decree No. 49 (Decree on Intellectual Property), Sections 2(n), 5, and 29
• Revised Penal Code, Article 189
• Rule 65, Rules of Court (certiorari procedure)
Factual and Procedural Background
Microsoft holds exclusive rights to print, reproduce, distribute, sell, and otherwise exploit its software under Section 5, P.D. 49. An NBI-accompanied test purchase in November 1997 led to a search warrant and the confiscation of pirated software at the respondent’s Taft Avenue premises. Microsoft filed an affidavit-complaint for violation of Section 29, P.D. 49. The DOJ State Prosecutor dismissed the charge on the ground that sale alone, without proof of copying or printing by the respondent, did not meet the elements of infringement. Microsoft’s motion for reconsideration and petition for review were both denied. The Court of Appeals likewise dismissed Microsoft’s certiorari petition for lack of grave abuse of discretion by the DOJ.
Issue
Whether the sale alone of unauthorized copies of Microsoft software constitutes an act of copyright infringement under Section 29, P.D. 49, without proof that the respondent physically copied or printed the works.
Ruling
The Supreme Court granted the petition for certiorari, held that the DOJ and CA committed grave abuse of discretion, and reversed and set aside the CA decision dated February 27, 2004.
Legal Reasoning
- Probable cause determinations by prosecutors are generally non-justiciable but may be reviewed when tainted by grave abuse of discretion.
- Section 5 of P.D. 49 defines “copyright” to include exclusive rights “to print, reprint, publish, copy, distribute, multiply, sell, and make photographs, photo-engravings, and pictorial illustrations of the works.” Any unauthorized exercise of these rights constitutes infringement.
- Jurisprudence (Columbia Pictures, Inc. v. Court of Appeals; NBI-Microsoft Corp. v. Hwang) clarifies that infringement consists of any unauthorized act covered by Section 5. The gravamen is the unauthorized performance of any enumerated act, not exclusively the act of copying.
- The Court of Appeals erred in rigidly construing the conjunctive “and” in Section 5(a) to require proof of every act (printing, copying, selling, etc.) in conjunction. Such a literal interpretation leads to absurd results, contradicts legislative intent, and ignores the broader purpose of protecting copyright.
- A purposive const
Case Syllabus (G.R. No. 166391)
Antecedents and Factual Background
- Microsoft Corporation owns all copyrights and trademarks in its software products, including MS-DOS, Windows, Office suite, Encarta, Flight Simulator, FoxPro, and their manuals.
- Respondent Rolando D. Manansala, doing business as Dataman Trading Company and/or Comic Alley at University Mall Building, Taft Ave., Manila, sold Microsoft software without authorization.
- On November 3, 1997, a private investigator and an NBI agent purchased six CD-ROMs containing alleged pirated Microsoft software from the respondent’s store.
- Pursuant to that test purchase, an NBI-requested search warrant was issued on November 17, 1997, and served on November 19, 1997, yielding several illicit copies of Microsoft programs.
- Microsoft, through counsel Teodoro Kalaw IV, filed an Affidavit-Complaint in the Department of Justice (DOJ) for violation of Section 29 of Presidential Decree No. 49 (the Decree on Intellectual Property).
DOJ Proceedings and Dismissals
- In a March 20, 2000 Resolution, the State Prosecutor dismissed the charge under Section 29 of P.D. 49, finding no proof that respondent actually printed or copied the products, and recommended a charge under Article 189 of the Revised Penal Code instead.
- Microsoft’s Motion for Partial Reconsideration argued that printing or copying is not essential to the crime of copyright infringement under Section 29 P.D. 49.
- On May 15, 2001, the public prosecutor denied the motion.
- Microsoft’s Pet