Revisit SC Filscap decision

Just recently, the Supreme Court ruled that a restaurant based in Baguio City violated the law on copyright infringement because the restaurant had a radio set playing inside its premises, and the music aired on the radio was heard by restaurant patrons through a loudspeaker.

The controversy started in 2008 when an agent of the Filipino Society of Composers, Authors and Publishers Inc. learned that branches of the Sizzling Plate Restaurant in the city had been playing music broadcast through a radio set inside the restaurant premises.

Filscap is a private corporation that oversees the use in the Philippines of copyrighted musical pieces in its catalog. Although it is described as a non-profit organization, its main objective is profit, i.e., to collect license fees for the use of copyrighted music.

Radio stations broadcasting copyrighted music listed in the Filscap catalog must pay a license fee. Filscap insisted that Anrey, Inc., the owner of the restaurant chain, should get a license from Filscap before it may play radio music inside its branches.

Anrey argued that the radio station which broadcast the music heard inside its branches already has a license from Filscap, and it is absurd to require a restaurant to pay an additional fee just because a radio set is played inside its premises.

Filscap went to court, but the Regional Trial Court of Baguio City and the Court of Appeals ruled against it. The Supreme Court, however, decided in favor of Filscap. The decision was written by Justice Rodil Zalameda.

With all due respect to the Supreme Court, that ruling ought to be revisited.

The profit the owner of copyrighted music derives from his intellectual creation depends on the music’s popularity. Popular music is the kind many people will want to listen to, and will likely share with friends. Likewise, they will probably want to watch performances of the piece in concerts or on television.

The radio broadcast of a musical piece is a way of making a musical piece popular. Music that isn’t played on the radio will be hard put at becoming popular with music lovers.

Restaurants play radio music on their premises only as an incidental aspect of their operations. The music simply provides a pleasant ambiance for restaurant patrons.

Although that arrangement may increase restaurant revenues, that pecuniary benefit is merely incidental because restaurantgoers patronize a dining place for its cuisine and service, and not particularly for the radio music they hear there.

The rationale behind the law on copyright is to protect copyright owners from plagiarism and unfair competition.

A restaurant playing radio music inside its premises is not engaged in plagiarism and is not a competitor in the music industry. On the contrary, the restaurant is actually helping the copyright owner promote his music to the public.

Considering that radio stations dedicated to playing recorded music already have a license from Filscap, it looks like Filscap also wants to collect a license fee from anyone listening to copyrighted music on a radio set that happens to be audible to the public.

The Filscap court victory will discourage restaurants, malls, stores and service parlors from playing radio music inside their establishments, particularly those which do not see any valid justification for the additional fees Filscap demands.

When fewer establishments play radio music on their premises, sponsors are unlikely to place advertisements on radio stations dedicated to broadcasting recorded music. Since radio stations depend on advertising revenues for their operation, the Filscap victory will toll the demise of many radio stations that air recorded music.

Thus, Filscap’s court victory even threatens the freedom and independence of radio stations which broadcast recorded music.

That grim doomsday scenario could not have been intended by Congress when it enacted the Intellectual Property Code.

Jurisprudence posits that laws should not be interpreted to lead to absurdity. The ruling in the Filscap case does precisely that.

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