Filipino Society of Composers v. Anrey
NEW DOCTRINEFacts
The Antecedents: Petitioner Filipino Society of Composers, Authors and Publishers, Inc. (FILSCAP), a non-profit collective management organization, owns the public performance rights to copyrighted music of its members and foreign affiliates. Between July and September 2008, a FILSCAP representative monitored several 'Sizzling Plate' restaurants in Baguio City, owned by respondent Anrey, Inc. (Anrey). The monitoring confirmed that the restaurants were playing radio broadcasts containing copyrighted songs from FILSCAP's repertoire through loudspeakers for their patrons. FILSCAP sent multiple demand letters to Anrey, informing them of the copyright infringement and urging them to secure the necessary public performance licenses. Anrey ignored these demands. Procedural History: FILSCAP filed a complaint for copyright infringement against Anrey before the Regional Trial Court (RTC) of Baguio City. Anrey argued that it did not play copyrighted music, but merely tuned into public radio broadcasts, for which the radio stations had already paid royalties. The RTC dismissed the complaint, ruling that Anrey was exempt under Section 184(i) of the Intellectual Property Code (IP Code), which applies to non-profit charitable or educational institutions that do not charge admission fees. On appeal, the Court of Appeals (CA) affirmed the RTC's decision. The CA, however, applied the 'homestyle and business exemptions' from United States law, which permit small businesses to use radios under specific conditions related to size and equipment, concluding Anrey was exempt. The Petition: FILSCAP filed a Petition for Review on Certiorari under Rule 45 with the Supreme Court. It argued that the lower courts erred in their application of exemptions. FILSCAP maintained that the unlicensed playing of radio broadcasts in a commercial establishment for the entertainment of customers constitutes an unauthorized public performance under the IP Code, thereby amounting to copyright infringement for which it is entitled to collect license fees.
Issue(s)
Whether the unlicensed playing of radio broadcasts as background music in the dining areas of a restaurant amounts to copyright infringement.
Ruling
WHEREFORE, the instant petition is GRANTED. The assailed Decision dated April 19, 2017 and Resolution dated August 3, 2017 of the Court of Appeals are REVERSED and SET ASIDE. Respondent Anrey, Inc., is hereby ORDERED to pay the Filipino Society of Composers, Authors, and Publishers, Inc. P10,000.00 as temperate damages for the unlicensed public performance of the copyrighted songs on FILSCAP's repertoire and P50,000.00 as attorney's fees, plus interest.
Ratio Decidendi
On the sole issue of copyright infringement: Yes, the unlicensed playing of radio broadcasts as background music in Anrey's restaurants constitutes copyright infringement. The Court found that the two essential elements of infringement were present: (1) FILSCAP owned a valid copyright or the authority to enforce it, as evidenced by its deeds of assignment and reciprocal agreements; and (2) Anrey violated at least one of FILSCAP's exclusive economic rights under Section 177 of the IP Code, specifically the right to public performance. Relying on the broad definition of 'public performance' in the IP Code and persuasive US jurisprudence like Buck v. Jewell-LaSalle Realty Co., the Court held that the act of receiving a radio broadcast and making it audible through loudspeakers is a 'performance' in itself. This act creates a new performance separate from the original broadcast, a concept known as the 'doctrine of multiple performances.' Furthermore, the Court adopted the 'new public' concept from the WIPO Guide to the Berne Convention, reasoning that the restaurant's patrons constitute a 'new public' not contemplated by the copyright owner when the license was granted to the radio station, thus requiring a separate license. The Court also ruled that the act did not fall under any statutory limitation. The exemption in Section 184(i) of the IP Code is inapplicable as Anrey is a for-profit commercial entity. The 'business exemptions' under US law cannot be imported into Philippine jurisdiction without a specific statutory basis. Finally, the act is not 'fair use' under Section 185 because the purpose is commercial (to enhance ambiance and profit), the nature of the work is creative, the songs were played in their entirety, and widespread similar conduct would substantially harm the potential market for the copyrighted music.
Main Doctrine
The act of playing radio broadcasts containing copyrighted music through loudspeakers in a commercial establishment, such as a restaurant, for the benefit of its customers, constitutes a public performance or communication to the public that is separate and distinct from the original broadcast by the radio station. This secondary act requires a separate license from the copyright owner or their authorized collective management organization. This is based on the 'doctrine of multiple performances,' where a single rendition can result in more than one performance, and the 'new public' concept, where the establishment's patrons are considered an audience not contemplated in the license granted to the broadcaster.