G.R. No. 184661, February 25, 2025
FILIPINO SOCIETY OF COMPOSERS AND PUBLISHERS, PETITIONER, VS. WOLFPAC COMMUNICATIONS, INC., RESPONDENT.

FACTS

Petitioner Filipino Society of Composers and Publishers (FILSCAP) is an organization authorized by its members to grant licenses for the use of their musical works and collect royalties. Respondent Wolfpac Communications, Inc. (Wolfpac) markets mobile phone applications and content, including ringback tones distributed through a partner-operator. In 2004, FILSCAP discovered an advertisement promoting the downloading of ringback tones from Wolfpac’s website, which featured a “pre-listening function” allowing potential consumers to listen to a 20-second sample of a song before downloading. FILSCAP demanded that Wolfpac secure performance licenses and pay royalties for the use of copyrighted musical works from its repertoire. Wolfpac refused, arguing that the pre-listening function did not constitute public performance. FILSCAP filed a complaint for copyright infringement. The Regional Trial Court (RTC) dismissed the complaint, ruling that the transmission of data for downloading ringtones constituted “communication to the public,” but the 20-second pre-listening function did not constitute “public performance” and was justified under the fair use doctrine. The RTC also noted that Wolfpac had memoranda of agreement with composers. FILSCAP’s motion for reconsideration was denied.

ISSUE

1. Whether the use of sample ringtones in the pre-listening function on Wolfpac’s website constitutes public performance or communication to the public.
2. Whether Wolfpac’s use of the samples constitutes copyright infringement.

RULING

The Petition is partly meritorious. The Supreme Court ruled that:
1. Wolfpac’s use of sample ringtones in the pre-listening function constitutes communication to the public, not public performance. The Court differentiated the two rights under the Intellectual Property Code, noting that communication to the public involves the transmission of works to the public, which aligns with the digital, on-demand, and interactive nature of the pre-listening service offered on a website.
2. Wolfpac’s use of the samples does not constitute copyright infringement as it falls under the fair use doctrine. The Court applied the four-factor test for fair use under Section 185 of the Intellectual Property Code: (a) the purpose and character of the use was commercial but transformative, as it allowed sampling to aid a purchase decision; (b) the nature of the copyrighted work favored protection, but the works were creative musical compositions; (c) the amount and substantiality of the portion used was a 20-second sample, which was insubstantial and not the heart of the work; and (d) the effect on the potential market was not adverse, as the samples promoted sales and had no independent commercial value. The deeds of assignment in Wolfpac’s favor did not explicitly authorize use in a pre-listening function, but the use was still permissible as fair use. Consequently, Wolfpac is not liable for copyright infringement, and FILSCAP is not entitled to royalties for the pre-listening function.