Monday, December 6, 2010

GMA Network, Inc. vs ABS-CBN, et. al.

Chester Cabalza recommends his visitors to please read the original & full text of the case cited. Xie xie!

GMA Network, Inc. vs. ABS-CBN, et al.
G.R. No. 160703
September 23, 2005


Petitioner GMA Network, Inc. (GMA') filed on May 6, 2003 before the Regional Trial Court of Quezon City a complaint for damages against respondents ABS-CBN Broadcasting Corporation (ABS-CBN'), Central CATV, Inc. (SkyCable'), Philippine Home Cable Holdings, Inc. (Home Cable') and Pilipino Cable Corporation (Sun Cable').

In its complaint, GMA alleged that respondents engaged in unfair competition when the cable companies arbitrarily re-channeled petitioner's cable television broadcast on February 1, 2003, in order to arrest and destroy its upswing performance in the television industry.

GMA argued that respondents were able to perpetrate such unfair business practice through a common ownership and interlocking businesses. SkyCable and Sun Cable are wholly-owned subsidiaries of Sky Vision Corporation (Sky Vision') which is allegedly controlled by Lopez, Inc. On the other hand, Home Cable is a wholly-owned subsidiary of Unilink Communications Corporation (Unilink'), which is owned by Mediaquest Holdings, Inc., a company controlled by the Pension Trust Fund of the PLDT Employees (PLDT Group').

Pursuant to a Master Consolidation Agreement, the ownership, rights and interests in Sky Vision and Unilink were purportedly placed under a holding company known as 'Beyond Cable', 66.5 % of which is owned by the Benpres Group, composed of Lopez Inc., Benpres Holdings and ABS-CBN, while 33.5% thereof is owned by the PLDT Group. As a result of this business combination, respondents have cornered at least 71% of the total cable television market in Mega Manila. They are thus able to dictate the signal transmission, channel position, and the airing of shows, programs, and broadcast of non-cable companies like ABS-CBN and GMA, which the law requires them to carry.

GMA alleged that the re-channeling of its cable television broadcast resulted in damage to its business operations.


(a) Should the complaint be adjudicated under the jurisdiction of the trial court or the NTC?

(b) Is GMA entitled to an award of damages, it would have to initially ascertain whether there was arbitrary re-channeling which distorted and downgraded GMA's signal?


Jurisdiction of the National Telecommunications Commission

Consequently, while it is true that the regular courts are possessed of general jurisdiction over actions for damages, it would nonetheless be proper for the courts to yield its jurisdiction in favor of an administrative body when the determination of underlying factual issues requires the special competence or knowledge of the latter. In this era of clogged court dockets, administrative boards or commissions with special knowledge, experience and capability to promptly hear and determine disputes on technical matters or intricate questions of facts, subject to judicial review in case of grave abuse of discretion, are well nigh indispensable. Between the power lodged in an administrative body and a court, therefore, the unmistakable trend is to refer it to the former.

In this regard, we note that there is a pending case before the NTC in which the factual issues raised in petitioner's complaint have also been pleaded. Although petitioner prays in the NTC case for the administrative remedy of cancellation of the cable companies' certificates of authority, licenses and permits, it is inevitable that, in granting or denying this prayer, the NTC would have to pass upon the same factual issues posed in petitioner's complaint before the trial court. The latter was thus correct in applying the doctrine of primary jurisdiction if only to avoid conflicting factual findings between the court and the NTC.

The regulation of ownership of television and cable television companies is likewise within the exclusive concern of the NTC, pursuant to its broader regulatory power of ensuring and promoting a 'larger and more effective use of communications, radio and television broadcasting facilities' in order that the public interest may well be served. The NTC is mandated to maintain effective competition among private entities engaged in the operation of public service communications. It is also the agency tasked to grant certificates of authority to cable television operators, provided that the same 'does not infringe on the television and broadcast markets.

Ruling on Damages

Finally, the complaint failed to state a cause of action against ABS-CBN and the other respondents, considering that the ultimate facts upon which the complaint for damages depends fall within the technical competence of an administrative body. Otherwise stated, pending determination by the NTC of the factual questions involved in the case, petitioner's complaint, which is founded upon such factual issues, would be premature.

WHEREFORE, the petition is DENIED. The assailed resolution dated October 30, 2003 of the Regional Trial Court of Quezon City, Branch 97, is AFFIRMED.

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