Monday, December 19, 2011

Challenging the Might of a Constitutional Right

The libel suit of PhilWeb Corporation against Internet blogger, Leo Alejandrino, bothers me.

The suit was brought about by comments made by Leo in his blog, entitled “The Saga Continues” which is hosted by Word Press. The complaint specifically quoted certain comments that the plaintiff claims to be defamatory:

“Ongpin has other vulnerabilities: His Philweb gaming franchise could be questioned, the business has a tie-up with PAGCOR and he has loans with DBP and LBP. I would stay away from his stock.

Rey is the low-lying fruit and the obvious fall guy. Ongpin says he loves him (“Rey is one of the smartest bankers in the country”, from Ongpin the ultimate profession of endearment) but he also said this of his partner of 50 years and of his country of 70. I am told Ongpin has already approached the Solicitor General for a deal but the Palace is not buying."

I read Leo’s blog more than once and the complaint twice. My view is that it could not, would not, and should not prosper.

I went back to my notes in U.S. and Philippine Constitutional Law, Cyber Law and Libel Law. There is no Cyber or Internet Libel law and jurisprudence in the Philippines so the plaintiff is relying mainly on Articles 353 and 354 of the Revised Penal Code (RPC).

I will tackle first the aforementioned articles of RPC, deal with them on the merits and relate the other laws and provisions of the Constitution later.

The complaint asserts the crime of libel being committed because all the elements as defined by Article 353 are allegedly present.

I beg to disagree.

First, the comments of Leo taken either partially or in its entirety are not defamatory.  “Defamation, including libel or slander, means injuring the person’s character, fame or reputation through false and malicious statements.” His statements are neither false nor malicious.

PhilWeb is a publicly listed company and derives a major part of its income by virtue of the franchise granted by PAGCOR, a government corporation. It has contracts with government agencies including the Bureau of Internal Revenue. Any information relating to any act, omission, condition, status or circumstance attributed to it should be of interest not only to shareholders and potential investors in particular but also to the public in general.

I am not surprised if there are questions on why PhilWeb was given the Internet Gaming Franchise without public bidding. Neither is it surprising to question why the PhilWeb-PAGCOR contract is allegedly co-terminus with PAGCOR’s corporate existence, which is in 2033. 

Consistent with PNoy’s anti-corruption campaign, it is expected that certain transactions that the government entered into in the past could be questioned. That’s why a search of news reports both offline and online would show that certain public officials have questioned and continue to question the wisdom and regularity of PAGCOR’s relationship with PhilWeb.

Second, are the comments of Leo committed publicly by the means enumerated under existing Philippine libel law? Article 355 of the Revised Penal Code provides that libel is committed by “means of writing, printing, lithography engraving, radio, phonograph, painting, theatrical exhibition, cinematographic exhibition, or any similar means.”

Blogging, online or electronic publishing are excluded from the list. Are they considered “similar means”? Since there is no Internet Libel law or Supreme Court jurisprudence regarding the matter, it might be wise to look at the laws in other jurisdictions. In a New York Supreme Court decision relating to whether electronic publishing is deemed included in the publishing contracts, it said NO because at the consummation of the publishing contracts, none of the parties knew about e-publishing then and the future.

Similarly, the authors of the Revised Penal Code were not and could not have been thinking of Internet blogging as one of the means to commit libel. The Revised Penal Code was enacted and became effective in the early 1930s.  

Third, were Leo’s comments malicious? The plaintiff is again relying on the provision that malice is presumed. A careful read would show that the presumption is not conclusive. It can be overcome by showing that the comments were published with good motives and justifiable ends. Article 361 states outright that the defendants shall be acquitted in such an instance.

The law also provides certain exceptions to the presumption. They are the absolute privilege communication and the qualified one as stated in Article 354 of the Revised Penal Code.  In fact, the Supreme Court had ruled that the rule on privilege communications applies to “fair comment on matters of public interest, fair comment being that which is true, or which if false, expresses the real opinion of the author based upon reasonable degree of care and on reasonable grounds.”

It is very clear that Leo’s motives in writing a blog without compensation are good. An expert in banking, finance and economics, rarely do we see someone like him freely provide data, information, analysis and wise opinions and/or advice on matters benefiting many unsuspecting small investors.

In a stock exchange which could be at times subject to stock manipulation, and one that is trying to build a reputation of clean and fair trading, it would be justifiable as an end for smart and intelligent financial analysts to freely express their views without fear from harassment such as a suit from a listed firm.

Fourth, PhilWeb is no doubt identified as the one whose deal with PAGCOR had been questioned by certain Senators, Congressmen and some published reports. There is also no doubt that its Chairman and principal stockholder Bobby Ongpin was the one who obtained loans from DBP and LBP and NOT PhilWeb. The entity referred to by Leo as under investigation by the Senate for possible insider trading and stock manipulation is Ongpin NOT PhilWeb.

Fifth, did Leo cause discredit or dishonor to PhilWeb?  His comments were informative, educational, entertaining and most importantly, beneficial to the public. As a publicly listed company, PhilWeb is a public juridical figure. Granted by the government a special privilege to operate Internet gaming, it is in the public’s interest to be informed.  Section 7 of Article III of the Constitution states: “The right of the people to information on matters of public concern shall be recognized. “


Section 4 of Article III of the Constitution provides: “No law shall be passed abridging the freedom of speech, of expression, or of the press, or the right of the people peaceably to assemble and petition the Government for redress of grievances.”

The provisions of the libel law should not be interpreted to effectively abridge freedom of the press. The latter is too important for the survival of democracy.

As American Publisher Arthur Sulzburger said, “Freedom of the press, or to be more precise, the benefit of freedom of the press, belongs to everyone – to the citizen as well as the publisher…The crux is not the publisher’s ‘freedom to print’; it is, rather, the citizen’s ‘right to know’. “

Leo Alejandrino, by blogging about politics and economics in the Philippines, has answered the call of duty and responsibility as a citizen. In an era where the culture of corruption has engulfed society, he is invoking his constitutional right as well as using the God-given tools he knows best. He is doing it with the best of motives and with the most justifiable ends.

PhilWeb should withdraw the complaint. It is for the benefit of the current stockholders, its own, the government, citizens and our democratic ideals. PhilWeb cannot stop Leo and other bloggers like me from using the Internet as a means of disseminating information and expressing our opinion.

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