8/10/2019 Columbia Pictures vs. CA - August 28, 1996
(Digests)
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Facts:The National Bureau of Investigation has engaged in an
anti-lm piracy driveby investigating various video establishments
in Metro Manila involving casesviolating PD No. !" as amended"
including #unshine $ome %ideo Inc. &'#unshine()"o*ned and
operated by Danilo +. Pelindario *ith address at No. , Mayfair
enter"Magallanes" Maati" Metro Manila.
/n November 0" 0!12" NBI #enior +gent 3auro . 4eyes applied for
a search*arrant *ith the court a quoagainst #unshine seeing the
sei5ure" among others" ofpirated video tapes of copyrighted lms"
*hich the court granted.
In the course of the search of the premises indicated in the
search *arrant"the NBI +gents found and sei5ed various video tapes
of duly copyrighted motionpictures6lms o*ned or e7clusively
distributed by olumbia Pictures" Inc. et al&olumbia et al.)
Thereafter" the court has lifted the search *arrant *hich it had
therefore issuedafter a series of motions" up until the +.
In the #" #unshine challenged olumbia et al8s legal standing in
our courts"
they being foreign corporations not licensed to do business in
the Philippines.
Issue:9hether or not olumbia et al *ere 'doing business( in the
Philippines" thus"needs to be licensed before having a legal
standing in Philippine courts.
Sunshines contention:
olumbia et al" being foreign corporations" should have such
license to beable to maintain an action in Philippine courts.
#unshine point to the fact that olumbia et al are the copyright
o*ners oro*ners of e7clusive rights of distribution in the
Philippines of copyrighted motion
pictures or lms" and also to the appointment of +tty. 4ico %.
Domingo as theirattorney-in-fact" as being constitutive of 'doing
business in the Philippines( under#ection 0&f) &0) and
&:)" 4ule 0 of the 4ules of the Board of Investments. +s
foreigncorporations doing business in the Philippines" #ection 0;;
of Batas Pambansa Blg.,1" or the orporation ode of the Philippines"
denies them the right to maintain asuit in Philippine courts in the
absence of a license to do business. onse
8/10/2019 Columbia Pictures vs. CA - August 28, 1996
(Digests)
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Ruling: No" foreign lm corporations do not transact or do
business in thePhilippines and" therefore" do not need to be
licensed in order to tae recourse toour courts.
+s acts constitutive of 'doing business"( the fact that olumbia
et al are admittedlycopyright o*ners or o*ners of e7clusive
distribution rights in the Philippines of
motion pictures or lms does not convert such o*nership into an
indicium of doingbusiness *hich *ould re
8/10/2019 Columbia Pictures vs. CA - August 28, 1996
(Digests)
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contemplates" to that e7tent" the performance of acts or *ors or
the e7ercise ofsome of the functions normally incident to or in
progressive prosecution of thepurpose and sub@ect of its
organi5ation.
+s a general rule" a foreign corporation *ill not be regarded as
doing business inthe #tate simply because it enters into contracts
*ith residents of the #tate" *here
such contracts are consummated outside the #tate. In fact" a
vie* is taen that aforeign corporation is not doing business in the
state merely because sales of itsproduct are made there or other
business furthering its interests is transacted thereby an alleged
agent" *hether a corporation or a natural person" *here
suchactivities are not under the direction and control of the
foreign corporation but areengaged in by the alleged agent as an
independent business.
It is generally held that sales made to customers in the #tate
by an independentdealer *ho has purchased and obtained title from
the corporation to the productssold are not a doing of business by
the corporation. 3ie*ise" a foreign corporation*hich sells its
products to persons styled 'distributing agents( in the #tate"
fordistribution by them" is not doing business in the #tate so as
to render it sub@ect toservice of process therein" *here the
contract *ith these purchasers is that theyshall buy e7clusively
from the foreign corporation such goods as it manufacturesand shall
sell them at trade prices established by it.
Merely engaging in litigation has been considered as not a
sucient minimumcontact to *arrant the e7ercise of @urisdiction over
a foreign corporation.
