DRMs in the draft Copyright Amendments

Recently, we’ve had a well written guest post by Amlan Mohanty, wherein he discusses several conceptual and practical problems with laws for the anti-circumvention of technological measures. As pointed out in the post, India is not a member of the WIPO Treaties such as WCT (WIPO Copyright Treaty) or WPPT (WIPO Performances and Phonogram Treaty), and therefore is not obligated to be importing/implementing DRM provisions into the Copyright law, not to mention that it is a TRIPS plus provision; yet, for obfuscated reasons we see their presence in the draft Amendment provisions. Indeed, even the western countries which have implemented DRM measures like RMI (Rights Management Information) and TPM (Technological protection methods), there is still significant confusion over its effectiveness as well as much criticism over its validity.

(Image at the right, created in 2006, taken from here. The creator, I would say, was not too far from the truth!)

For the sake of clarity, let me make clear the distinction between RMIs and TPMs:
RMIs are commonly understood as information which is provided by copyright holders, (or holders of a right under copyright) meant to identify the right holder(s) and other information like terms and conditions regarding the copyrighted material. These are therefore generally understood as beneficial to both rights-holders as well as to users/consumers since it leads to both backward tracing to the rights holder, as well as points towards authenticity of the material, amongst other functions. (This is understood to be mutually beneficial in the hypothetical where RMI is not coupled with more than just providing information).

The commonly more troubling aspect of DRMs are the TPMs. TPMs are measures used to enforce restrictions and limitations on the use of the copyrighted material which it is embedded in, and it is validity of these restrictions and limitations which bring up all the problems associated with DRMs. (My favorite web-comic XKCD displaying some not very uncommon angst towards DRM limitations on number of copies one can make)




India has been under a lot of pressure from the US, due to the Special 301 report which US puts out annually, to amend and enforce its copyright laws to a standard closer to what the US would want; usually standards which the US has succeeded in pushing through in WIPO treaties. Therefore, essentially, it is the same lobby which pushes for stricter laws in US as it is in India. (Incidentally, I recently wrote a post on Hollywood tying up with Bollywood to check piracy in India). To further add to this, even as their effect in US has come under severe criticism; for them to be the lobbying party in India without due regard for the local context, economy and culture seems absurd. For a developing country like India, which even other developing countries look up to, it is important to get their copyright law correct, since the alternative is that instead of incentivizing and aiding creation and creative works, it is creating unnecessary barriers to access to creative works (especially considering that there is a big emphasis in Indian culture to adapt and improvise on works already in the public domain).

Looking at the draft provisions:
Section 2(xa) provides the definition of Rights Management Information. RMI is defined narrowly enough to include only information (or number or coded representation of information) which identifies the work/performance and/or the name of the author/performer, provides information about the owner of rights, and terms and conditions regarding the use of rights. Presumably in the interest of privacy rights, it explicitly excludes any devices or procedures intended to identify the user. This seems to be a balanced provision which allows only for the communicating of information and doesn't include any TPMs through it.

Section 65B which provides for the enforcement of RMIs allows attachment of civil or criminal liability towards violating persons:

Any person, who knowingly
(i) removes or alters any rights management information without authority, or
(ii) distributes, imports for distribution, broadcasts or communicates to the public , without authority , copies of any work, or performance knowing that electronic rights management information has been removed or altered without authority, shall be punishable with imprisonment which may extend to two years and shall also be liable to fine;

This provision has more or less been lifted from the equivalent WCT provision - Article 12. Arguably, this leaves room for impleading 3rd parties such as ISPs as a distributor, or broadcaster for example. The argument would go roughly like -> The ISP knows that some piracy is being communicated through it, and therefore is under an obligation to find out exactly what and by whom. If this argument is sustainable, then a whole host of privacy issues on behalf of the consumers, and obligatory functions on behalf of ISPs immediately arise.

Article 65A, which provides for TPMs, is also more or less a lift from Article 11 of the WCT, however, importantly, it adds certain limitations.

(1) Any person who circumvents an effective technological measure applied for the purpose of protecting any of the rights conferred by this Act, with the intention of infringing such rights, shall be punishable with imprisonment which may extend to two years and shall also be liable to fine.

(2) Nothing in sub-section (1) shall prevent any person from: (a) doing anything referred to therein for a purpose not expressly prohibited by this Act:

Provided that any person facilitating circumvention by another person of a technological measure for such a purpose shall maintain a complete record of such other person including his name, address and all relevant particulars necessary to identify him and the purpose for which he has been facilitated; or

(b) doing anything necessary to conduct encryption research using a lawfully obtained encrypted copy; or
(c) conducting any lawful investigation; or
(d) doing anything necessary for the purpose of testing the security of a computer system or a computer network with the authorization of its owner or operator; or
(e) doing anything necessary to circumvent technological measures intended for identification or surveillance of a user; or
(f) taking measures necessary in the interest of national security.


With the exceptions in place, as far as TPMs go, this seems like a relatively consumer friendly provision. (for those questioning the balance on the other side of the scale, the mere existence of the TRIPs plus provision represents rights holders interest here)

The main provision firstly, essentially 'allows' trivial circumvention by stating that the offense consists of circumvention of "effective" measures. This is a vague word which is bound to create definitional problems if implemented. In fact, if one were to take a strict definition of 'effective' one might even argue, that if one is able to circumvent the technology, it is not effective! Presumably, eventually there will be a (confusing) test which will apply a 'reasonable man' or Person having ordinary skill in the art" (phosita) type of analysis (to determine against whom this measure is effective) which, in all probability, in the backdrop of a world full of child computer geniuses, won't make things much easier anyway.

The exception under 2(a) is an important one as it doesn't legitimise 'extra' rights or control measures, but restricts TPMs to only those rights granted in the Copyright Act. Thus all acts of Fair Dealing under S.52 will not be run afoul by this provision. [This, however, would not solve the practical problem of lay users requiring to bypass strict TPMs if they wish to use any material for fair dealing purposes, it merely clarifies that such action is not illegal]

It is also interesting to note that goods, services or methods which could be used for circumvention are not discussed in the draft provision. These have been rendered illegal in some jurisdictions and several problems regarding free speech, free trade and freedom of expression had arisen due to it.

Thus overall, the draft DRM provisions seem to be much less draconian than feared. And indeed, in the hypothetical where India was necessitated into protecting DRMs in our Copyright law, they would probably be considered fair and balanced.

However, India is not necessitated into importing or protecting DRMs and these therefore remain nothing but a "next-best" solution. They still would result in unnecessary transaction costs, in cases of fair dealing of a TPM-ed work, or even in some cases of normal use; they could interfere with the resale market, which is generally very large; it would lead to a lot of capital being diverted to the corporate houses providing much of the DRM protection (currently all foreign players); they would lead to the introduction of automatically enforced license terms; and most importantly, international experience has already shown us that the enforcers of DRMs attempt to exploit it to the maximum by creating artificial monopolies, and thus stifling innovation and competition - certainly an outcome we could do without, both culturally and economically.

P.S.: DRMs, TPMs, RMI, ISPs, WCT, WPPT, WIPO, not to mention IP, and PHOSITA. Apparently, this field is one which loves acronyms!

To belong or not to belong? Toyota suffers setback in trademark battle before the Delhi High Court

In a recent decision of the Delhi High Court, available here, the Japanese automobile magnet Toyota suffered a setback, when the petition that it had filed seeking exclusive rights over the trademark “PRIUS” for its hybrid cars was dismissed by the court. The matter, titled Toyota Jidosha Kabushiki Kaisha v. Deepak Mangal & Others, comprised of I.A.Nos.16776/2009, 110/2010, 1156/2010 & Crl.M.A.No.1032/2010 in CS(OS) No.2490/2009 and the judgement was delivered on March 19, 2010 by Indermeet Kaur, J.

The petitioner had sought to prevent the defendants from using the trademark/trading style TOYOTA, the toyota device, INNOVA and PRIUS regarding automobile parts and accessories or any other related goods or to perform a passing-off action with respect to the defendant’s goods in the name of the petitioner.

This suit was actually based on a two-fold cause of action. The first was regarding the infringement of the 3 registered trademarks of the petitioner by the defendants, viz. TOYOTA, the toyota device and INNOVA. The second was with respect of the defendants seeking to pass off the trademark PRIUS as their own. The petitioner had claimed to be the prior user of that trademark, although it had not been registered before in India in the petitioner’s name.

According to the petitioner, in 1994, it had designed a concept vehicle with a hybrid engine, named it “PRIUS” after the Latin word “prior” or “before”. The first model was sold in December, 1997 in Japan and the vehicle was officially launched in 2001. Petitioner has also been the registered proprietor of the trademark PRIUS in as many as 28 countries from 1990 onwards. In order to back its position, the petitioner put on record the sales figures of the car in foreign counties as well as extensive advertisements of the vehicle both in national and international publications. Newspaper reports and other online media coverage of the petitioner’s promotion of the PRIUS brand had also been cited along with. The defendants, on the other hand, were alleged to have been using the same mark as an essential and leading portion of their trading name and the same appears on the defendants’ products. Nor have the defendants sought any authorization from the petitioner for such use and hence such action on the defendants’ part allegedly amounted to passing off and dilution of the plaintiff’s trademark, thereby adversely affecting the plaintiff’s goodwill.

Given the wide media coverage that the vehicle and the petitioner’s actions to promote the same along with the new hybrid system received even in prominent Indian newspapers and automotive journals, the petitioner contended that it was not possible to believe that the defendants were unaware of the prior usage of the mark PRIUS and the petitioner company’s association with the same and that their subsequent efforts to use the mark had not been aimed to pass off the petitioner company’s huge goodwill and brand value as their own.
In this context, the petitioner relied upon the decision of the Supreme Court in N.R. Dongre v. Whirlpool Corporation [(1996) 5 SCC 714]. The relevant part of the judgement that had been cited is as follows:

“The concept and principle on which passing off action is grounded is that a man is not to sell his own goods under the pretence that they are the goods of another man. A trader needs protection of his right of prior user of a trade mark as the benefit of the name and reputation earned by him cannot be taken advantage of by another trader by copying the mark and getting it registered before he could get the same registered in his favour. We see no reason why a registered owner of a trade mark should be allowed to deceive purchasers into the belief that they are getting the goods of another while they would be buying the goods of the former which they never intended to do. In an action for passing off if should not matter whether misrepresentation or deception has proceeded from a registered or an unregistered user of a trademark. He cannot represent his own goods as the goods of somebody else.”

According to the petitioner, as per this judgement, although the defendants might have registered the trademark PRIUS under their names, but the same did not constitute a defence for their action seeking to pass-off the petitioner’s goods as their own. To substantiate this allegation, the decision in Jolen Inc. v. Doctor and Company [(2002)2 C.T.M.R. 6] was also cited.

The petitioner also referred to Pfizer Ireland Pharmaceuticals v. Intas Pharmaceuticals and Anr. [2004(28) PTC 456(Del)] to support the submission that the worldwide reputation of the trademark PRIUS has been established by his sale turnover. Regarding the defendants’ plea of the plaintiff not having any presence/business in India when the defendant had adopted the mark, it was contended that the plaintiff was naturally affected when it sought to establish such business in India and found the defendant to be trespassing, as was the case in Ford Motor Company of Canada Limited & Anr. v. Ford Services Centre [MANU/DE/1774/2008], where plaintiff was found entitled to the interim relief.

The defendants pleaded that the petitioner has delayed for long before approaching the court, in response to which, the latter cited the case of Daimler Benz Aktiegesellschaft and Anr. v Hybo Hindustan [AIR 1994 Delhi 239] to contend that the delay in approaching the Court could not justify the use of the trademark which was a worldwide famous name. The petitioner had further drawn the court’s attention to the packaging of the defendants’ products, showing use of the trademark TOYOTA, the toyota device, INNOVA and PRIUS along with the invoices, brochures and price list. It had further been submitted that the extensive use of the said marks on these documents of the defendant prima facie evidence his malafide intent; i.e. of the infringement of the petitioner’s trademarks and passing off his goods to the innocent purchaser as that of his own. The defendants pleaded that such use for the purpose of character identification of goods, which was categorically denied by the petitioner.

Defendants in this case had put up a defence of delay, waiver and acquiescence on the part of the petitioner. According to them, the petitioner had neither applied for registration of the trademark PRIUS itself nor objected to the defendants’ registration of the same in 2002. By allowing use of said mark by defendants for such a long time from 2002 to 2009, the petitioner was alleged to have given up all claims, if any, on that mark. Defendants further submitted that certain advertisements, as produced by the defendants in evidence clearly exhibit that the defendant is the supplier of garnish covers and auto accessories for various vehicles including that of the Toyota group. The usage of marks ‘toyota device’ had only thus been for the purpose of the identification of the item and its suitability to the wide range of vehicles mentioned thereunder and not with the intent to deceive the purchaser or to confuse him into believing that defendants had been selling auto accessories of ‘TOYOTA’. In fact, petitioner itself had relied on the same published advertisements.

Nor had the petitioner provided any explanation regarding the delay that it indulged into before bringing the matter to court, which indicated acquiescence of defendants’ claim by the petitioner, if not a waiver of rights. In this context, reliance had been placed on the cases Amritdhara Pharmacy v. Satyadeo Gutpa [AIR 1963 SC 449] and Khoday Distilleries Limited(Now known as Khoday India Limited) v. The Scotch Whisky Association and Ors. [AIR 2008 SC 2737] were delay in filing application alleging infringement had been held as fatal to the accusation.

"PRIUS" being contained in the English dictionaries, it was argued that petitioner could not claim a monopoly over the word, which was not an invented one and Sections 30(1)(b), (2)(d) and Section 35 of the Trademark Act were relied upon to argue that ‘Toyota’, ‘toyota device’ and ‘INNOVA’ had been used by the defendants only to demonstrate the compatibility of the auto accessories in the use of these vehicles, along with several others. For this, defendants had relied upon Hawkins Cooker Ltd v. M/s Murugan Enterprises [2008(36) PTC 290(Del)].

Petitioner, in return argued that mere existence of the aforesaid advertisements on the defendants’ part did not necessarily imply that petitioner had prior knowledge of the infringement. A distinction was sought to be drawn between constructive knowledge and actual knowledge in this context and the cases of Automatic Electric Limited v. R.K.Dhawan & Anr. [1999 PTC (19) 81] and M/s Hidesign v. M/s Hidesign Creations [AIR 1991 Delhi 243] were cited in support. It was further contended tha the cumulative sales figure of the defendants during this 7 year-delay consisted of a miniscule figure only and hence could not be regarded as proceeds from a well-established business. To establish the legality of the petitioner having proprietary word PRIUS and to quash the defendants objections regarding the same, the matters of Ciba Ltd. Basle Switzerland v. M.Ramalingam and S.Subramaniam Trading in the name of Sought Indian Manufacturing Co., Madura and Another [AIR 1958 Bombay 56 (V 25 C 21 )], Altiebolaget Volvo v. Volvo Steels Limited [1998 PTC (18) (DB)], Satyam Infoway Ltd. v. Siffynet Solutions (P) Ltd. [(2004) 6 SCC 145] were relied upon. To drive home defendants’ dishonest usage of the marks from the beginning, the petitioner cited the cases of L.D.Malhotra Industries v. Ropi Industries [ILR 1976 Delhi 278] and Beiersdorf A.G. v. Ajay Sukhwani and Another [2009 (39) PTC 38 (Del.)].

The petitioner also contended that high safety measures adopted by the petitioner compared to the defendant also needed to be borne in mind and the purchaser could not be exposed willingly to a risk given the nature of the goods involved, viz. automobile parts.

The court held that the journals publicizing petitioner’s usage of PRIUS were not easily available to the common Indian public. Even the Indian magazine publications relied upon by the petitioner had been irregular at best. It had only been in 2009 that the Auto Indian Magazines had published detailed information on the Toyota vehicle. The court referred to the case of Gillette Company vs. A.K. Stationery [2001 PTC 573 (Del)]. In that matter, judiciary had recognized the principle of a trans-border reputation and the spill over of its international reputation from foreign lands to the Indian boundaries. It had been held that its application would depend on case-to-case basis. In the present case, the court believed that there was not sufficient material on record to hold that an Indian purchaser of chrome plated auto accessories had become aware Toyota’s association with the PRIUS mark. The case of Sakalain Meghjee v. B.M.House (India) Ltd. [2002 (24) PTC 207 (Del)] was also referred to in this relation.

On the other hand, the registration of the mark by the defendants in 2001 and the subsequent sales figures indicated that the exclusive use of the said mark by them as per Section 28(2) of the Trademarks Act and continuing business regarding the same. The court refused to accept the petitioner’s argument of it having only a constructive knowledge of the defendants’ usage of the mark. The defendants’ reliance on the Amritdhara Case and the Khode distilleries case was also approved of.

The court opined that acquiescence was one facet of delay and if the petitioner had stood by knowingly and let the defendants build up an important trade until it had become necessary to crush it, then the petitioner would be stopped by his acquiescence. Thus if the acquiescence in the infringement amounted to consent, it would be a complete defence and the acquiescence must be such as to lead to the inference of a license sufficient to create a new right in the defendant. The court in this context also referred to cases such as Ramdev Food Products(P) Ltd. v. Arvindbhai Rambhai Patel and Ors.[2006 (33) PTC 281] and other legal authorities like Halsbury’s Laws of England, Fourth Edition, Vol. 16, paragraph 1505 to emphasize this point.

The court then went on to say that petitioner’s delay in filing the case by 7 years without having a reasonable explanation allowed the defendant to establish a substantial business and at that point, such delay might be prejudicial to the petitioner being granted any relief. Reference was made to cases such as Allied Blenders and Distillers P. Ltd. v. Paul P.John and Ors. [2008 (38) PTC 568 (Del)] and Procter & Gamble Company v. Satish Patel and Ors. [1997 (1) ARBLR 158 (Del)] and also Standard Electricals Limited v. Rocket Electricals and Anr. [2004 (72) DRJ 794]. The court also dubbed the petitioner’s submission of it having learnt about the defendant only in 2009 on a stray web search as patently false and chastised the petitioner for not having disclosed to the court the date of registration of the mark by the defendants as far back as March, 2002. Had it done so, then that would have been taken into consideration before the court had granted interim relief to the petitioner. Mention was made of Old Navy (ITM) Inc. and Ors., GAP (ITM) Inc. and Ors. and Banana Republic (Itm) Inc. and Ors. [2007(99) DRJ 571], wherein it was held that non-disclosure of material facts would work to the prejudice of such a non-disclosing party disentitling him to a relief in equity.

The status of PRIUS as not being an invented word was also established and the defendants were held to be honest user of the same. The court also took note of the dissimilarity between the trade dress of the petitioner and the defendants, including the packaging, shape of material, all visual impressions and their getup including its colour scheme, description of the words i.e. their font, size and alphabetical array etc. as also the variation in price. Moreover, according to the court, the purchaser of those auto accessories being usually one from a high income group, he was likely to be an educated person aware of the identity of the seller who was unlikely to mistake the defendant for the petitioner. The defendant on the use of the registered marks Toyota, the toyota device and the INNOVA was held to be protected under the saving clause of Section 30 of the Trademarks Act, which protects a honest user of a registered trade mark for the purpose of identification of the goods. Mention was also made of the European Court decision in Gillette Company vs. L.A.Laboratory [2005(37) FSR 808] in this context. In that case, the conditions of an honest use within the meaning of Article 1(1)(c) of the Directive 89/104 was held to be in substance the expression of a duty to act fairly in relation to the legitimate interests of the trade mark owner. The use is dishonest only if: “It is done in such a manner as to give the impression that there is a commercial connection between the third party and the trade mark owner; ii. It affects the value of the trade mark by taking unfair advantage of its distinctive character or repute; iii. It entails the discrediting or denigration of that mark.”

The petitioner had failed to establish such dishonest use by the defendant, who in turn had proven that his use of the mark PRIUS was in accordance with the honest practices in industrial and commercial matters. Since he had not been taking any unfair advantage and his use was not detrimental to the distinctive character or the repute of such a trademark, therefore it did not amount to an infringement/passing off. As per Section 29 of the Trademark Act, the onus to prove that the mark of the petitioner had been infringed lied upon the plaintiff and so did the responsibility of proving that the alleged infringement fell beyond the purview of the exceptions laid down in Section 30. The court also accepted defendant’s argument under Section 30(2)(d) of the use of the other marks like TOYOTA, toyota device and INNOVA as reasonably necessary to indicate that the goods are adaptable and suited to the vehicles mentioned therein

The balance of convenience also lied in favour of the defendant, since if after business growth of more than seven years the defendant is prevented from using his trade name, he would suffer huge business loss and his legitimate financial expectations would be harmed irreparably. On the other hand, given that petitioner had not even launched the vehicle PRIUS on the Indian roads, no similar injury would be suffered by him if defendant was allowed to continue the usage.

Thus, given the aforesaid reasoning, the court dismissed the petitioner’s allegations of trademark infringement against the defendants.

Results of the 1st Annual Intellectual Property Law Writing Competition by VJLT and Altacit Global

As the readers of Spicy IP are aware of, the Virginia Journal of Law & Technology, in collaboration with Altacit Global (an intellectual property law firm that is known for its specialty in offering strategic board-level advice to companies), had held the 1st Annual Intellectual Property Law Writing Competition on "The Varying Treatment of Patentable Subject Matter" sometime back (see post here). The following results of the competition have been conveyed to Spicy IP by the organizers, who graciously intend this to be the first official announcement:
Ms. Susan A. Fyan, from the Michigan State University College of Law, USA, has been adjudged the winner and will be awarded with certificate & Cash Award of USD 500, while Ms. Kanika Sharma from the Rajiv Gandhi School of Intellectual Property Law, Indian Institute of Technology, India has achieved the runners-up position and will be awarded with a certificate & Cash Award of USD 250.
The Spicy IP team, along with Altacit Global and the Virginia Journal of Law and Technology, congratulate them both and thank the Editorial Board and all participants for making the competition a grand success.

SpicyIP Events: The 1st IJLT-CIS Annual Law Lecture Series

The Editorial Board of the Indian Journal of Law and Technology, Student Bar Association, The National Law School of India University (NLSIU) is organizing a lecture series along with the Centre for Internet and Society (CIS).

The theme for the Lecture Series is "Jurisdictional Issues in Cyberspace". The Chief Guest for the Lecture Series is Hon'ble Dr. Justice S. Muralidhar (Judge, High Court of Delhi). Dr. Justice Muralidhar delivered the illuminating decision in the Banyan Tree case (Banyan Tree Holdings (P) Ltd. v. A. Murali Krishna Reddy) that established the legal position in India in relation to jurisdiction in cyberspace. The other speakers are Mr. Amit Sachdeva (Advocate, High Court of Delhi), Mr. Aditya Sondhi (Advocate, High Court of Karnataka) and Dr. Lorna E. Gillies (Lecturer in Law, University of Leicester).

The date for the Lecture Series is 3 April 2010. The venue is the National Law School of India University, Nagarbhavi, Bangalore. The schedule for the Lecture Series is provided hereafter.

0830 - 0930: Registration for participants.
0930 - 1015: Inauguration ceremony.
1015 - 1145: Session 1 – Dr. Justice Muralidhar.
1200 - 1330: Session 2 – Mr. Amit Sachdeva.
1330 - 1400: Lunch.
1400 - 1530: Session 3 – Mr. Aditya Sondhi.
1530 - 1700: Session 4 – Dr. Lorna Gillies.
1700 - 1715: Vote of Thanks, Distribution of Certificates, etc.

Those interested are requested to please register via an e-mail to "editorialboard@ijlt.in". There are no charges or fees applicable.

IPAB’s Power of Review

This is a slightly dated order of the IPAB (August 2009), where it was held that IPAB does not have the power of substantive review of its decisions. The order was delivered in an appeal involving Nestle, the appeal arising out of the rejection under Section 15 of Nestle’s application for a patent.

The hearing on the appeal was adjourned twice at the request of the authorized counsel for the appellant; a third date was also sought and granted to the appellant. However, there was none present on behalf of the appellant on the said date and consequently the appeal was treated as abandoned under Rule 17(2) of the IPAB Rules, 2003.

A review petition purportedly under Section 92 of the Trademarks Act was filed on grounds that the IPAB had not followed Rule 16 which requires issuance of notice of hearing to the parties and that the non-appearance of the appellant or its counsel was unintentional and bonafide. The appellant however admitted that its authorized counsel had not informed it of the date of hearing.

To this the IPAB responded saying that by the appellant’s own admission, the authorized counsel was to blame for not informing it of the date of hearing. (I am yet to take a look at Rule 16, but, is issuance of notice of hearing subject to the absence of the counsel of a party?) The IPAB’s primary contention was with regard to its own ability to undertake substantive review of orders passed by it.

The IPAB interpreted Section 92 of the Trademarks Act to conclude that although the Board was vested with the powers of a Civil court to issue summons or receive evidence, the power of review was conspicuous by its absence. This is in contrast to Section 77 of the Patents Act or Section 127 of the Trademarks Act which give the Controller and the Registrar respectively, the power of substantive review.

The Board also held that it (meaning the IPAB), being a creation of a statute, could not vest itself with powers of substantive review unless the statute expressly provided for it. The power of procedural review however being ancillary to its function, was inherent in it. To support this, the Board cited a few decisions of the Supreme Court, the Grindlays decision being a prominent one.

Since the petition in question called for a review of a debatable point of substantive law and not something patently erroneous, the Board held that such a review was not within the scope of its powers.

SpicyIP Tidbit: Delhi HC Refuses Ex-parte Order against Ranbaxy

Earlier this week, it was reported in the Economic Times that the Delhi High Court has refused US pharma major Bristol-Myers Squibb’s application for an ex-parte injunction order against Ranbaxy for launching a generic version of Squibb’s hepatitis B drug, Baraclude. However, the application for interim injunction is yet to be heard.

The Court has given Ranbaxy a period of 2 weeks to file its reply after which arguments on the interim application would be taken up. The drug Entecavir reportedly has global sales to the tune of $ 191 million.The Court observed that Squibb’s patented molecule appeared to be a pre-1995 one.

Apart from Ranbaxy, Natco and Cipla too seem to have plans in the pipeline for launching generic versions of Baraclude.

This matter promises to be an interesting one, watch out this space for more updates.

Guest Post: Waxing Lyrical on Royalties - An Analysis of the Author-Centric Amendments Proposed to the Indian Copyright Act

I'm pleased to bring to you yet another fascinating guest post from Nikhil Krishnamurthy, Senior Partner of Krishnamurthy & Co. on the proposed author-centric amendments proposed to the Copyright Act, 1957.

To provide a very brief background to Nikhil's post I refer you to one of our earlier posts outlining the clash between Aamir Khan and Javed Akhtar on the importance or lack therefore of lyricists to the sucess of a movie.

WAXING LYRICAL ON ROYALTIES – AN ANALYSIS OF THE AUTHOR-CENTRIC AMENDMENTS PROPOSED TO THE INDIAN COPYRIGHT ACT

“I love you from the bottom, of my pencil case ...
I love you in the songs, I write and sing ...
Love you because, you put me in my rightful place ...
And I love the PRS cheques, that you bring ...”
Beautiful South – Song for Whoever
Introduction

For those of you who haven’t heard “Song for Whoever” by the Beautiful South, it is one of my favourites and I highly recommend that you go now and listen to it over here. This article can wait.

Make sure you read the lyrics over here, as you listen, to fully appreciate the song.

The line about receiving PRS (Performing Right Society) cheques is something that foreign author-composers take for granted. This is not, apparently, the case in India, and for a variety of reasons.

Recently, an ugly war of words erupted between the author/ composer community on the one side and Indian film producers on the other. The author/ composer community, reportedly fed up with constantly having to sign away all their rights in Indian film music, and consequently losing out on sharing royalties in both the old and the new streams of exploitation such as ring tones, digital downloads and so on, petitioned the Ministry of HRD to introduce amendments into the Copyright Act 1957 with a view to protecting their interests. These amendments supposedly prevented the absolute assignment of authors’ rights in works incorporated in cinematograph films with a view to ensuring that author composers receive music publishing income.

The film producer community immediately expressed its fears that the amendments would not only undermine the value of the publishing rights they acquired from author-composers, but would also affect the substantial minimum guarantees paid by music companies to acquire the rights to film music, which in turn, would affect the funding required for producing their films. The film producers argued that they spent much production money in hiring the right star for the film, in the production of the audio-visual film songs, in providing inputs to the author composers as to the settings etc. of the song, and that their input cannot be lightly brushed aside.

For the genesis of the present dispute, one has to go back a few years. It appears that in 2005, the publisher (music company) members of IPRS decided that since they allegedly owned all rights to underlying works, the portion of royalty paid by IPRS to its author-composer members, must be distributed to them and not the author composers.

Consequently, a letter was sent to author composers in 2005 whereby they were asked to substantiate their copyrights in any music written by them, failing which public performance royalty payments previously being distributed by the IPRS to author composers would be stopped.

Prior to this, most author composer members of IPRS were receiving public performance royalties for their works. The author (lyricist) received 20%, the composer received 30% (both received as an “encouragement” fee) and the remaining 50% was given to the music publisher or music company.

So for example if a song from a Hindi film was aired on radio, two royalties were payable by the radio station. One was paid to PPL towards the public performance of the sound recording, and a second was paid to IPRS towards the public performance of the underlying works, i.e. the lyrics and the tune. It is this second royalty that IPRS used to split 20:30:50 as already explained.

As author composer members did not substantiate their rights for one reason or another, it led to a cessation in royalties paid to them for public performance of works authored by them. Note that till 2005, they were only receiving public performance royalties and were generally not receiving any mechanical royalties on cassettes and CD sales (presumably because the ‘publishers’ were the record labels themselves) or synchronization fee (when the song is re-used in a film or advertisement).

Consequently, post 2005, the only source of income for any author composer hired for a film project became the one-time lump-sum paid by the film producer and that was it. In the meantime, the multi-crore deals between film producers, music companies and content aggregators for music they had composed raised questions as to why they were not entitled to a share in such royalty amounts.

It was not always this way. I have seen agreements from past film production houses where clauses like the ones below had been inserted in favour of the composer.

We further irrevocable agree to pay you 50% share of Royalty which we get from the Gramophone Company on the sale of the Gramophone Records of the above said picture for which we will give you a separate letter in the name of Gramophone Company authorizing them to pay the 50% share of Royalty amount, directly to you. [Mechanical Royalties]

We further irrevocably agree to give you 50% share of the Royalty amount we get from All India Radio (Vividh Bharti) or any other Radio Station in any part of the world for the broadcast of the songs of the above picture from any station of the above mentioned Radios (Broadcasting Stations). [Public Performance Royalties]

That we further agree and confirm irrevocably that under Copyright Act any kind of Royalty from any part of the World for the Music and the Tunes of the above said picture shall belong to you in full and we shall have no claim to share that amount. [Other Publishing Income]

So, it appears that in the past, composers had a pretty good hold over their copyrights. How they lost their control must be the subject of another blog.

A very rough timeline of author composer royalties for works incorporated into films would read as under: -
Post – 2005 – only lump-sum one-time payment from the film producer
1980 to 2005 – lump-sum payment from the film producer + performance royalties
Pre – 1980 – lump-sum payment from the film producer + performance royalties + possibly other publishing income

In fact, if one sees some of the standard form agreements of The Gramophone Company with film producers during the 1970’s, one sees that the term of the assignment effectively lasted 25 years and post that period, the rights actually returned to the film producer. This was held to be so in Saregama India Ltd. v Suresh Jindal, AIR 2006 Cal 340 where the Learned Judge found that

“The intention to limit the agreement is clearly expressed in Clauses 6, 7-A(d), 14 of the agreement. The negative covenant contained in Clause 6 makes it clear that the respondent No. 1 shall not infringe the copyright assigned in favour of the petitioner for the period of twenty-five years. If the grant was intended to be for an unlimited period, there could not be any negative covenant for a limited period. Even the royalty as required to be paid under the agreement is limited till twenty-five years. ... In the instant case, the harmonious construction of the clauses leave no manner of doubt that the parties intended to limit the agreement for a period of 25 years at the most. ... In the instant case, the negative covenant restraining the respondent from utilising to whole or any part of the sound-track or any works performance relating to the subject-matter of the agreement is restricted for a period of 25 years, therefore, after the period of 25 years the respondent would be free to do otherwise. This clearly suggests that the agreement was not intended to continue for the full statutory period as contended on behalf of the petitioner.”

There is presumably a vast body of copyright work where the copyrights may have actually returned to the film producers in view of the 25 year term of assignment but in the absence of any due diligence conducted by such film producers, they will not know if this is indeed the case. This is all the more pertinent because in 1993 IPRS derecognised film producer members in favour of record labels as Publisher members.

In the light of the Calcutta High Court decision cited above, it may be that some film producers continue to be entitled to remain IPRS members and receive performance royalties as rights have reverted to them. This is also another topic for discussion in itself and I will not dwell further on this.

In this view of the matter, let us now examine some “amendments” (in bold below) which have been brought to my attention as those supposedly proposed by the Ministry of HRD in the Copyright Act (Amendment) Bill, 2009 to protect the rights of author-composers to see if they do indeed live up to the hype.

The Amendments: -

[Section 17 (b) subject to the provisions of clause (a), in the case of a photograph taken, or a painting or portrait drawn, or an engraving or a cinematograph film made, for valuable consideration at the instance of any person, such person shall, in the absence of any agreement to the contrary, be the first owner of the copyright therein;

Provided that in case of any works incorporated in cinematograph work, nothing in clause (b) shall affect the right of the author in the work referred to in clause (a) subsection (1) of section 13.

Section 17 © in the case of a work made in the course of the author s employment under a contract of service or apprenticeship, to which clause (a) or clause (b) does not apply, the employer shall, in the absence of any agreement to the contrary, be the first owner of the copyright therein;

Provided that in case of any works incorporated in cinematograph work, nothing in clause © shall affect the right of the author in the work referred to in clause (a) of subsection (1) of section 13.]

Examining the amendments proposed to Section 17 (b) and (c), we see that the copyrights of the author in works made under a work for hire, which are incorporated in a film, are sought to be preserved and this seems to be merely a reiteration of Section 13 (4) of the Act which says that copyright in a cinematograph film or sound recording will not affect the separate copyright of the works incorporated in such film or recording.

It would therefore appear that in Section 17 (b) where a work is commissioned for a film, the author would retain copyright over his work and even a contract to the contrary will not help the commissioner.

It would further appear that in Section 17 (c) under employment contracts generally, the employer would be the first owner of copyright of any work, but if the employer is a film producer, the author’s rights are preserved. Even a contract to the contrary will not help the film producer.

This seems to meet with the general objective of the proposed amendments.

Moving to the next amendment.

[Section 18: The owner of the copyright in an existing work or the prospective owner of the copyright in a future work may assign to any person the copyright either wholly or partially and either generally or subject to limitations and either for the whole term of the copyright or any part thereof: …

Provided further that the author of the literary or musical work included in cinematograph film or sound recording shall not assign the right to receive royalties from the utilization of such work in any other form other than as part of cinematograph film or sound recording except to the legal heirs or to a copyright society for collection and distribution and any contract to contrary shall be void.]

Reading the newly proposed Proviso to Section 18, it appears: -

That there is a distinction sought to be made between an assignment of copyright and the assignment of the right to receive royalties though what this nuance entails is still unclear.

That the assignment by an author of the right to receive royalties in a literary or musical work incorporated in a film is restricted to the utilization of that work in a film or sound recording.

That the assignment by an author of the right to receive royalties in a literary or musical work for the utilization of the work in any other form can only be made to a legal heir or copyright society.

One immediately sees the problem with this proposed amendment. Music publishing is concerned with the utilization of the work in as many forms as possible, be it in films, sound recordings, live performances, sheet music (which is no business in terms of Indian film music anyway), and so on, so as to maximize the royalty collection in relation to a work.

If an author can assign away the right to receive royalties to a film producer when the work is used as a part of a film or sound recordings, nothing prevents a film producer from insisting on seeking such an assignment in relation to any film and any sound recording in which the work is utilized. In such a case, the producer will be entitled to collect royalties when the work is utilized in any subsequent film (even an ad film) or sound recording (cover versions), including the original film and sound recordings.

As ring tones these days are most popularly true tones, i.e., the original sound recordings themselves, this entitles the film producer/ music company to all royalties on the utilization of the work in ring tones and other new media/ digital forms of exploitation of the sound recording.

So what does this supposed amendment leave for the author ? The right to collect royalties for live performances and for sheet music. Maybe a translation here and there. Little else really. This is a situation worse off than the existing position under the law, though maybe not industry practice.

Had the language been restricted to assign the right to collect royalty for utilization of the work in the cinematograph film and sound recording in which it was first utilized, that may have served to meet the supposed objectives of the amendments. However, one must consider that if author composers had a decent bargaining position today, they could, under even the existing law, negotiate for royalties for the use of their works in the first film or recording itself by way of synchronization and mechanical licenses. The amendment is therefore regressive in that sense.

[Section 19 (8) Any assignment of copyright in any work contrary to that of the terms and conditions of the rights already assigned to a copyright society in which the author of the work is a member, shall be deemed to be void.

Section 19 (8) is really unnecessary as any assignment contrary to what has already been assigned will in any event be void under law. The said situation is covered by the legal maxims Nemo Dat Quod Non Habet – meaning, no one can give what he does not have, and Assignatus Utitur Jure Auctoris – meaning, an assignee is clothed only with the right of his principal.

In the past, film producers have negotiated the fact of prior assignment of copyright by authors of their present and future works to IPRS by claiming that since the works are created under conditions of work for hire they (the film producers) are first owners of copyright in the said work, and that therefore the question of assignment, or assignment in contravention of the author’s prior assignment to IPRS does not arise.

However, as I have argued elsewhere (see http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1306223), composers are not usually employees of film producers for first ownership of copyright to vest in the producers and moreover, where a work is commissioned, copyright in only certain types of works, which are restricted to certain types of artistic works and films (and DO NOT include musical or literary works (lyrics) which are treated separately under the Act), will vest in the person commissioning the work.

Therefore copyright in lyrics and music commissioned for a film do not automatically belong to the producer as first owner under Section 17 (b) since the provision does not cover all types of copyright works like Section 17 (c) does. For works created under a 17 (b) situation and which does not fall into any of the types of works specified by Section 17 (b), the commissioner will have to seek an assignment of rights from the author.

[Section 19 (9) No assignment of copyright in any work to make a cinematograph film or sound recording shall affect the right of the author of the work to claim royalties in case of utilization of the work in any form other than as part of cinematograph film or sound recording.]

I have already stated my view above that such a carve out in favour of the author is really not an effective carve out at all and in fact serves to confuse the issue further.

Conclusion
In the words of CISAC’s president, ex-Bee Gee Robin Gibb, “If you’ve ever had the pleasure of watching a Bollywood movie, you know what a central role music plays in Indian cinema. Music adds true value to Indian film productions and the fact that the authors of these musical works have had their rights taken away and received no subsequent royalties is unconscionable. The Indian Cabinet has taken a major step towards resolving this problem. Let’s hope that the Indian Parliament will follow suit. Movie music in India is a big business and it’s unacceptable that the composers and lyricists who make the music don’t benefit from the success of their works because of an outdated system. Indian producers and record companies clearly don’t want to share their royalties with creators, but the Indian Parliament needs to know that this is not the norm elsewhere.”

CISAC’s Director-General Eric Baptiste has stated that “Composers and authors in other key filmmaking markets like the United States, the European Union, Canada, Hong Kong, Japan and Taiwan do not lose their right to a share in the royalties when their creations are used in films, even though, like their Indian colleagues, they have been paid to compose or write for film or sound recording companies.”

While the Government’s intention behind these amendments is praiseworthy and should be welcomed, I do not see the amendments, in their current wording, as either greatly benefiting the authors or being greatly detrimental to film producers. As analysed, the payment of royalties to authors may become limited, effectively, only to earnings from live performances and consequently, will never be at par with international standards.

It seems that the Government has tried to fashion the amendments along the lines of some European countries which restrict the assignment of copyright by an author, under a publishing agreement, for a lump-sum. Such models impose obligations on the publisher to render periodic accounts to the author and limit the instances where any lump-sum is payable, but in trying to adapt these principles by way of a home-brewed formula, much has been lost in translation.

This is a historic opportunity to align our Copyright Act with the best in the world and it is hoped that there is better application of mind in framing the amendments. Till such time, PRS cheques will only be enjoyed and immortalized in song by the foreign counterparts of Indian author composers.

Delhi High Court rules on 'deemed abandonments' by the Patent Office under Section 21

The Delhi High Court while disposing a writ petition in the recent case of Telefonaltiebolaget LM Ericsson v. Union of India once again reminded the Patent Office the true scope and impact of 'deemed abandonments' under Section 21 of the Patents Act, 1970.

Section 21 of the Patents Act is a deeming provision which deems a patent application to be abandoned if in case a patent applicant does not respond to a Patent Office request within the prescribed time period. Over the last few years there have been quite a few 'deemed abandonments'. By rejecting a patent application as 'abandoned' the Patent Office saves itself the time and effort of rendering a reasoned decision.

The time-line in this particular case is as follows:

National Phase Patent Application No. 3380/DELNP/2005 on 29th July 2005 Invention “A Method and Apparatus For Supporting Content Purchases Over a Public Communication Network.”

Patent Published on 1st June, 2007

FER issued on 8th October, 2007

Reply to FER was filed on 10th December, 2007

Patent Office raised same objections on 25th July, 2008

Last date given to the applicant in this letter was 8th October, 2008

22nd September, 2008 – The Applicant replied to the Second Examination Report with request for hearing under Section 14

10th October, 2008 Patent Office deemed application to have been abandoned under Section 21(1) since last date for putting application in order expired on 8th October, 2008

The Delhi High Court falling back on precedent in the case of Ferid Allani v. Union of India 2008 (37) PTC 448 (Del.) (which we've blogged about here) reiterated “that “abandonment” requires a conscious act on the part of the Petitioner which would manifest the intention to abandon the application.” The mere fact that the Petitioner's second reply did not meet the requirements of the Patent Office cannot deem an application to be abandoned. Once an applicant has sent some form of reply to the Patent Office the application can be rejected only under the procedures prescribed in Sections 14 and 15. It must also be mentioned that while an Order under Section 21 is not appealable, an order under Sections 14 and 15 of the Patent Act is in fact appealable. A rejection under Section 21 therefore affects the substantial rights of the applicant.

Interestingly, there was no Government Counsel representing the Patent Office in this matter.

Spicy IP Tidbit: US Court rules that all non-US copyright owners must register their Copyright

Some useful information for all non-US copyright holders who may need to file a suit in the US for copyright infringement:

An article on Mondaq by James Trigg and Harris W. Henderson, points out an interesting decision [Elsevier B.V. v. UnitedHealth Group, Inc., No, 9 Civ. 2124 (S.D.N.Y. January, 14, 2010)] by the Southern District Court of New York which affects all non-US copyright holders.
In brief, the article points out that the court essentially held that certain formality-requiring provisions of the US Copyright Act cannot be challenged under the Berne Convention as it is not a self-executing treaty. [The Berne Convention states that the enjoyment and exercise of copyright shall not be subject to any formality] The formalities in question require the registration of copyrights by the owner with the US Copyright Office prior to an infringement, or at the most within the 3 month grace period after publication in order to be eligible for statutory damages and attorney fees. US is the only country where such a requirement is necessary. Thus a plaintiff would be required to prove actual damages and/or profits made by the defendant alleged with infringement in the absence of the plaintiff's registration of the copyright.

See the full article for more details on the case.

Guest Post: Protection of Folklore

We bring to our readers a guest post by Shyama Kuriakose, a Masters Student at the NALSAR, Hyderabad. She has extensively worked on matters relating to intellectual property law and environmental law during her internships with civil society organisations, lawyers and law firms.

“You cannot really know where you are going until you know where you have been.”

The ancient civilizations of the world, with their contributions in the field of arts, literature, science, etc have led to the present glorious state of nations. The Aztecs, Incas, Mesopotamian civilization, the various African tribes, Australian aboriginals, tribes in the Indian sub-continent, some of which exist to this day, are continuing to make their contributions.

Their contributions include ancient folklore, stories, art forms, legends, rituals in written as well as oral forms. The oral contributions have been said to pass down from generation to generation. The Vedas are a good example. The peculiarity of this kind of knowledge is that it defines the culture and heritage of the community which contributes to it. It sets them apart from the rest of the people. Quite a number of tribes flourish to this day, in this modern world by keeping their culture alive. The value of the knowledge available from these people is not just of commercial value but also of spiritual, religious and social as well.

The information referred to above may not be traditional knowledge stricto sensu, the term ‘folklore’ being more suitable.[1] Protection for this knowledge is yet to be formalized. The Convention on Biological Diversity (CBD) recognized the value of traditional knowledge in protecting species, ecosystems and landscapes, and regulated access to it and its use. Its provisions obliges each contracting party, as far as possible to, respect, preserve and maintain knowledge, innovations and practices of indigenous and local communities relevant for the conservation and sustainable use of biological diversity and promote their wider application with the approval and involvement of the holders of such knowledge, innovations and practices and encourage the equitable sharing of the benefits arising from the utilization of such knowledge, innovations and practices.[2]

WIPO established the Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore. The high-level Brundtland Report (1987) recommended a change in development policy that allowed for direct community participation and respected local rights and aspirations.

The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) contains provisions regarding protection of intellectual property. Great stress is laid down on exclusion of certain items from being patented as per Article 27. In the TRIPs-related Doha Declaration of 2001, Paragraph 19 expanded the review to a review of Article 27 and the rest of the TRIPs agreement to include the relationship between the TRIPS Agreement and the UN Convention on Biological Diversity (CBD) and the protection of traditional knowledge and folklore.

The possibility of protecting folklore by means of copyright was raised in 1967 at the Diplomatic Conference of Stockholm for the revision of the Berne Convention.[3] Although the issue was not fully resolved, the following provisions were included in the Stockholm Act of the Convention, and retained in the revision adopted in Paris in 1971. In the case of unpublished works where the identity of the author is unknown, but where there is every ground to presume that he is a national of a country of the Union, it shall be a matter for legislation in that country to designate the competent authority which shall represent the author and shall be entitled to protect and enforce his rights in the countries of the Union.[4] Countries of the Union which make such designation under the terms of this provision shall notify the Director General [of WIPO] by means of a written declaration giving full information concerning the authority thus designated. The Director General shall at once communicate this declaration to all other countries of the Union.[5]

Article 29 [6] of the Indian Constitution may help the community with a unique culture to protect its folklore but there has not been a legislation pertaining to this. Other relevant Article is Article 51 A [7] which imposes a fundamental duty on the citizens of India.

The Biological Diversity Act 2002, does not properly cater for the protection of folklore but is more on the lines of conservation of bio-diversity in India essentially related to traditional knowledge of various indigenous communities.

The provision relevant in this context is Section 31A of the Copyright Act 1957, which provides for compulsory licensing in unpublished Indian works. Herein, in the case of any Indian work, the author is dead or unknown or cannot be traced, or the owner of the copyright in such work cannot be found, any person may apply to the Copyright Board for a license to publish such work or a translation thereof in any language. This gives the finder of any knowledge, to have the right to apply for a copyright over the article or information discovered.

Many of the developing countries such as Iran, Kenya, Sri Lanka, China, etc have made attempts to include the term “folklore” into their copyright laws. Copyright protection to different forms of folklores is still a hard thing to grapple with, in India

Copyright law has some fundamental limitations in the folklore context. Firstly, copyright requires an identifiable author, the notion of individual authorship being a problematic concept in many traditional societies. Secondly, copyright has a time limit but folkloric expressions must have permanent protection. Third, copyright normally requires works to be fixed. However, among some traditional groups, folkloric expressions are not fixed, but are passed on orally from generation to generation. This normally excludes such expressions from eligibility for copyright protection. Copyrighting folklore is not yet possible in the Indian context because these expressions mostly come from common stock of ideas.

On a perusal of Section 31A, it is seen that this provision raises a difficulty with respect to keeping the treasures of a country, within its territory. Any person or agency which comes across such valuable knowledge has the right, under the Indian legislation, to claim a copyright over the said knowledge. The territory from which it was unearthed is not relevant for the purposes of copyright. For example, all the discoveries of the Harappa and Mohenjo-daro civilizations failed to stay within the territory of India probably due to lack of technology, initiative and also the dominance of British rule. Foreign archeological agencies did the necessary excavations and took away, all the discoveries to their own respective countries.

Ancient India was wrought with literature varied and rich in many respects. However, only very less percent of this literature has been saved in writing. This is not because India’s past is barren of deeds worthy of remembrance. This neglect may have been either due to a lack of proper historical sense, or indifference of the religious orders, that controlled and developed the literatures. However, the history of ancient India suffers greatly from the initial difficulty of the want of genuine works of historiography. The ancient historian Alberuni once said that whenever Indians have been pressed for information and they are at a loss to say anything, they always take to tale telling. This is how the various legends and myths were born in India.

The various folklores and traditions passed from generation to generation are gradually getting extinct now. Much of this knowledge was transferred on a one to one basis.[8] In this way the secrets were well guarded, as nothing was recorded in the written form. It was feared that if such knowledge was freely made available to an unprepared mind, it may cause harm. A very pertinent example is the restriction on teaching of Sanskrit slokas and verses.

There is the well known incident where the University of Mississippi Medical Center was granted patent for the healing of wounds using turmeric. Indian authorities challenged this patent on the basis that it was already common knowledge in India but it could do so only after providing published documentation of the same fact. There is no copyright in ideas. It subsists only in the material form in which these ideas are expressed. That’s another huge problem seen with traditional knowledge especially for those which are in the form of folktales or legends.[9]

Various measures have been suggested to give effective protection to the folklore. It could be done by mainly following three approaches. Firstly, by giving this knowledge, the protection as cultural heritage, secondly by creating a national folklore database, thirdly by making certain amends to the existing laws and treaties. Sui generis laws enacted exclusively for the purpose of protection of folklore knowledge is advisable.

Creating a national folklore database requires huge infrastructure and incentives to be given to those who are the custodians of such heritage. More funds should be released for the excavation and preserving of structures which represent the cultural heritage. Latest of technology must be implemented for the same purpose. Promotion of tourism is another brilliant idea.

A conscientious and responsible approach must also be made on part of the citizens of a nation whose cultural heritage is at stake. This is not about restricting the sharing of benefits accrued from such knowledge to the world outside. This is about not paying a price for something that’s always belonged to us for ages. In our kitchens, on a daily basis, our mothers and grandmothers come up with various home-made remedies and aids to various problems, which have been passed down to them from their ancestors. There must not come a day, when such ideas are stocked up as products in international stores and we are forced to buy them in the form of pepper coffee (chukkumkappi vellam) drink for 2 dollars!!!!

Footnotes:
[1] www.unesco.org/culture/copyright/folklore/html_eng/symposium.shtml accessed on 21-07-2008
[2] Wikipedia, accessed on 21-07-2008
[3] cyber.law.harvard.edu/openeconomies/okn/asiatk.html accessed on 21-07-2008
[4] Article 15.4[a]
[5] Article 15.4[b]
[6] “Any section of the citizens residing in the territory of India or any part thereof having a distinct language, script or culture of its own shall have the right to conserve the same.”
[7] “to value and preserve the rich heritage of our composite culture.”
[8] www.achalasiddha.com/Folk/folk.htm accessed on 02-09-2008
[9] Donna Rosenberg, in her book Folklore, Myth, and Legends: A World Perspective defines folktales and legends as:

A folktale is a story that, in its plot, is pure fiction and that has no particular location in either time or space. However, despite its elements of fantasy, a folktale is actually a symbolic way of presenting the different means by which human beings cope with the world in which they live. Folktales concern people -- either royalty or common folk -- or animals who speak and act like people..

A legend is a story from the past about a subject that was, or is believed to have been, historical. Legends concern people, places, and events. Usually, the subject is a saint, a king, a hero, a famous person, or a war. A legend is always associated with a particular place and a particular time in history.

Guest Post: Commercial Disparagement: Call for a Cost-Benefit Analysis?

We bring you a guest post by Kartik Khanna a very promising student of the second year of NUJS, Kolkata. He is presently a member of the NUJS Moot Court Society and has also won the 2009 National Law School International Arbitration Moot Court Competition.


Rin’s latest advertisement, placing itself to be a better bet than Tide is anything but squeaky clean (pun intended). Having done so, the ugly head of commercial disparagement has been reared again. P & G, the brand owner of Tide has a valid claim bolstered by the string of case laws such as Colgate Palmolive India Ltd. v. Anchor Health & Beauty Care Pvt. Ltd. that have discussed its elements ad nauseam.

The requirements for commercial disparagement are a reference to Claimant’s product, the said assertion being false, the presence of malice and Claimant suffering special damages as a result of the advertisement. Rin manages to land itself in dirty water (puns galore!) by successfully conforming to almost every requirement formulated to constitute Commercial Disparagement.

The concerned advertisement positions a mother as having a son smug with the prospect of having whiter uniforms owing to Rin’s proficiency in contrast with another family using Tide. The first child even manages to steal Tide’s catchphrase to make the mother look silly. All in all, HUL has ended up making a real mess (pun possibility?). In other words, an explicit reference as mandated in a slew of cases globally such as De Beers Abrasive Products Ltd. v. International General Electric Co. of New York has been made.

The veracity of whether Rin is truly a better product in cleaning clothes owing to production superiority is a question beyond the scope of the debate. No trader lacks the ability to state his product to be finest in the market and stronger, finer or better than its competitors. It is outside the law however, for a trader to declare his product to be the best if at the same time he asserts his competitor’s product to be of inferior quality. Credit for the same goes to the matter of Reckitt Colman of India ltd vs. MP Ramachandran and Anr. Rather than poking fun at a competitor as Pepsi and Coke did in their famous ad wars, Rin went all the way to bash any brand image Tide might have enjoyed. Therefore, while scientific veracity of the claim cannot be judged at the outset, the ad itself is negative to its competitor and hence, implicates HUL.

The law of Commercial Disparagement is sourced from Tort Law where malice too plays a key role. In other words, a trader must have the wilful intention to cause injury to the business reputation of the competitor. Even in the eventuality that a trader did not intend to do so; blame can still be attributed to him on the ground that he negligently failed to foresee that his statement would have disparaged the claimant’s product [American Co. v. France]. Tide would still be able to argue this element effectively as it can be alleged that even if an obvious presence of malice is absent, it can be inferred from the very nature of the impugned advertisement.

A question one must ask oneself is with respect to the final element of damage caused as a result of the disparaging advertisement. A pioneering piece on the Tort of Commercial Disparagement, The Law of Commercial Disparagement: Business Defamation’s Impotent Ally argues that a large number of economic choices a consumer makes in a day are affected by flow of information from other sources- an ad being a valid source of information.

I wonder however, in a media blitz such as the one our world resides in, is any publicity of this sort- where a product itself has not been alleged to be harmful to a user per se and has simply been deemed less superior, opinion shaping? In other words, would such an ad cause a consumer to actually think that Tide is not a good product and cause its users to change loyalties? Surely a discerning viewer and consumer would not have looked at the Sprite ad that poked fun at Mountain Dew and decide against consuming the latter! In fact, by resorting to such a form of advertisement, Rin has unnecessarily included Tide in their screen time. Creating the current brouhaha has only given Tide free publicity funded by Rin.

Any good publicity agent would tell you that a good ad must create an impression on the minds of the viewer. Companies should stick to the aim of making sure that their brand identity is firmly imprinted on viewer consciousness. However, ads such as the one made by Rin are counter-productive to the company if such controversies are going to give Tide free publicity anyway. The advantage if any is offset by the unnecessary publicity highlighted.

With the hefty prospect of impending litigation and free publicity to the owner of the disparaged brand, it is time that brands employ a cost-benefit analysis to such disparaging advertisements.

Image from here.

Guest Post: Note on the Proposed Amendments to the Indian Copyright Act: Technological Protection in Measures/ Digital Rights Management

We are glad to bring to our readers a fresh perspective by Amlan Mohanty, a second year student of the National Law School of India University, Bangalore. He has previously published on the blog of the Centre of Internet and Society and variously on current intellectual property and technology law issues.

Just when we thought we had heard the last of DRM (Digital Rights Management) the government of India, with its recent press release on the proposed amendments to the Copyright Act, seems to have awakened the sleeping giant and acknowledged this grossly restrictive technological mechanism as a legitimate tool to prevent infringement, and incorporated it into the copyright system of India. What makes the entire situation worse is the concept of 'anti-circumvention', which going by the press release, is something the government strongly endorses and will be discussed in the next post.

While the press release hesitates to go into specifics, it does indicate the government's desire to introduce 'measures against the circumvention of technological measures' (note: 'technological measures' will be referred to as DRM's (Digital Rights Management) henceforth), an implicit acceptance of the use of such measures in the protection of copyrighted works. While debates on the pros and cons of DRM's have been doing the rounds for sometime already, a simple explanation of the practical implications of introducing such a provision in the Copyright Act is essential to understand the full impact it may have on the average Indian consumer.

WHAT DO YOU MEAN BY DRM or TECHNOLOGICAL MEASURES?
First things first. What are DRM's? DRM in its simplest form means technologies that restrict the use of digital files in order to protect the interests of copyright holders. And how exactly does it go about doing this? It can prevent or restrict a computer from altering, sharing, copying, printing or saving protected digital files. In essence, it provides owners of copyrighted works remote control over the way in which their works are viewed, duplicated, listened to or installed. Seems about fair. But how does this translate into practise? This is where things get murky.

DRM's LIMIT MY CHOICES AS A CONSUMER: • LIMITS THE NUMBER OF COMPUTERS I CAN COPY MY FILES TO
Let's take the example of Apple's DRM technology. Apple embeds its FairPlay DRM technology into the music files available on its iTunes store and imposes conditions on its consumers (legitimate consumers, mind you). I download a song from the store and I'm immediately informed that I'm allowed to store this particular file on a maximum of 3 computers (now, 5). Apple, through its DRM technology, takes it upon itself to decide how many computers I am legitimately allowed to copy this song onto. So when I download the family's favourite Bollywood song, 'Wake Up Sid' starring Ranbir Kapoor, from the online music store, I find that I can't store it on my desktop at home, my laptop that I carry to college, my dad's laptop and my mother's netbook. Apparently that's one too many copies for a song that I legitimately bought and paid for in full. To make things worse, every time I format my hard drive, I have to de-authorise and re-authorise my computer and if I merely switch operating systems from Windows to Linux, it is deemed to be an additional authorised computer use.

• LIMITS USE BASED ON MY LOCATION
If that seems harsh, then think about how ridiculous it is that the DVD of 'Kuch Kuch Hota Hain', which I bought in New Delhi will not play in my cousin's house in New Jersey, simply because the DRM software in the DVD won't let me. When DVD's are linked to DVD players on a geographical basis because of regional coding, where one needs to use an American manufactured DVD player to play a U.S manufactured film and a Singaporean DVD player for a Singaporean film, we have a real problem on our hands.

• LIMITS USE BASED ON THE SOFTWARE I USE
Examples of such restrictions are aplenty. The movie that I just downloaded online should logically play on any software that plays videos. But with DRM systems in place, that's not the case. Remember those RealAudio and video files that wouldn't play on anything but RealPlayer? What if there was a rare video clip available on an online news portal like the NDTV 24x7 website and it employed DRM? Shouldn't I be allowed to watch a clip about the German Bakery bomb blast without having to download a particular video player? Why should my grandfather have to worry about technical issues like proprietary file formats and compatible software, when all he wants to do is stream a piece of Carnatic music online? DRM's will essentially allow a popular website to restrict my digital rights by dictating what software I have to use to view its content and having my rights and choices trampled upon, is definitely not something I want.

• DO I EVEN 'OWN' THE CONTENT I BUY?
DRM technology, it seems, creates a situation where consumers do not buy, but are merely leased or rented content on terms and conditions imposed by the provider, despite having to pay exorbitant prices. What happens if the online store I am buying from decides to shut shop? Do I lose my content forever? The answer you will get - 'Of course not'. The real answer – 'Practically, yes'. All I have to do, they tell me, is buy several hundred blank CD's and make back up copies of each and every song or video I downloaded from them. After all, what do they care about the investment I made, so long as they've made their money.
When I'm not allowed to play a song that I legally downloaded on multiple systems manufactured by different companies, restricted by time and space constraints, or prevented from converting the music file I downloaded into a format of my choice (essentially 'locked-in' to a particular system or portable player'), I have to ask the question – 'Is DRM good for me as a consumer?'. The answer is an emphatic 'NO'.

DRM's ARE NOT RELATED TO COPYRIGHT LAW
Of course, one may ask, 'why the hullabaloo when DRM technology only serves to protect rights that the Indian Copyright Act already protects, and in an ingenious and inexpensive manner at that?' The fact remains that DRM's allow copyright holders to prevent consumers from accessing and using works in ways that are actually permissible under Indian copyright law today. Just as I'm allowed to carry the latest paperback edition of 'The Da Vinci Code' with me around the world, there is nothing in copyright law that prevents me from doing the same with my legally purchased DVD. Except, apparently, DRM.

It is the legitimacy accorded to DRM's that allows the inclusion of commercials and trailers on the 'unskippable' portion on DVD's, which is actually reserved for the display of copyright notices. What pray, does displaying a commercial about baby shampoo have to do with protecting the interests of the copyright owner? I see no reason why people should complain about rampant piracy when consumer rights are slighted to such an extent. This image does a wonderful job of explaining what I'm talking about.

DRM'S DO NOT AND CANNOT UNDERSTAND THE DIFFERENCE BETWEEN ILLEGAL AND FAIR USE
DRM technologies care little for the distinction between fair use and illegal use. Take for example the DRM technology in Kindle's e-book reading device which removed the the text-to-speech capabilities that are highly beneficial to persons with visual impairments. If the Indian Copyright Act otherwise allows me to convert an e-book into a format that allows easier access to information, why should DRM's interfere in the exercise of such rights?

More importantly, how does one expect a pre-programmed technological device or software to understand the nuances of fair dealing and fair use rights? The complex variables involved in determining what is permissible under copyright law is difficult for the human mind itself to grapple with, and when the statute itself makes no attempt to lay down any strict guidelines or parameters in this regard, it is unfair for DRM to make such a decision by itself. For example, rights granted under Section 52, such as the use of copyrighted materials by teachers for instructional use and students for research, reproduction of such works in a library, making of cover versions or remixes of copyrighted songs etc., might be curtailed by DRM's if they are brought into the copyright regime, and the dangers of restricting rights of consumers that are already protected under the Act cannot be overstated.

WHY ALLOW DRM's AT ALL?
The argument often extended by lawmakers when they bring about changes in domestic legislations that adversely affect the rights of consumers is that they are obligated by international treaties to make such changes. While the 1996 WIPO Copyright Treaty requires nations that are party to the treaty to enact laws against the circumvention of DRM's (hence, allowing the use of DRM technologies by rights owners), it is important to note that India is NOT party to the WCT and is under no obligation whatsoever to recognise DRM's or enact laws prohibiting its circumvention. Why then is the government adamant in its desire to introduce such a provision? As I had remarked in the introductory note, developing countries are often accused of accommodating Western-imposed notions and standards of copyright protection into their domestic copyright legislations, without there being any necessity or obligation. When the developing nations across the world are looking to India to lead the way, should we be going back in time and adopting a provision that curtails fundamental consumer rights?

IS THERE A SOLUTION?
While the ideal solution would be for the Indian Copyright Act to remain DRM-free, if demands for the adoption of anti-circumvention laws persist, then the following safeguards must be introduced as well.

Firstly, circumvention for the purposes that are permissible under present copyright law must not be allowed. The corollary of this is that DRM's should not be used to protect interest that copyright law doesn't permit one to protect. Secondly, I envisage situations where intelligently placed, robust DRM's make it much harder to circumvent these restrictions. In such a case, it is the duty of the the person who has placed the technological measure to provide the circumvention tool when the purpose for use of the works is stated and it comes within the sphere of permissible uses under the Copyright Act.

Image from here.

Peer-To-Patent Australia Commences Second Phase

Peer-to-Patent Australia (see here and here) is a joint initiative of the Queensland University of Technology (QUT) and IP Australia's patent office, and is designed to improve the patent examination process and the quality of issued patents by encouraging members of the public to assist the patent office locate prior art relevant  to pending patent applications.After making a promising start in December 2009, the project has now entered its second phase bringing a new set of patent applications to be peer reviewed. The second phase of the project boasts patent applications from General Electric, IBM, Hewlett-Packard, Western Union and Aristocrat. QUT and IP Australia invite appropriately qualified people to contribute to the project. 

They are looking for scientists, engineers, patent examiners, patent searchers, patent attorneys, lawyers and others to take part. Members of the public are encouraged to join the online peer community to review patent applications and put forward relevant prior art. You do not need to be an Australian to contribute - peer reviewers from all countries are invited.

To register as a peer reviewer and join the prior art search, visit the Peer-to-Patent Australia website at: www.peertopatent.org.au.

SpicyIP Tidbits: Bollywood survives TM attempts in US & Germany

Today's tidbit is specially for Hindi film buffs, and will be of particular interest to those who, like myself, have strong views on references to the "Bollywood" film industry.

Happiness in USA!

SpicyIP reader Shivani Kochhar draws our attention to a recent decision of the Trademark Trial and Appeal Board (TTAB) of the United States Patent and Trade Mark Office, which refused to allow an application for the mark THE BOLLYWOOD REPORTER for entertainment-related publications. You can download and read the decision here: In re Nielsen Business Media, Inc., 93 USPQ2d 1545 (TTAB 2010).

The TTAB, in its precedential decision, held that Nielsen Media (the Applicant) could not rely on its registrations for the mark THE HOLLYWOOD REPORTER (see logo) to establish rights of acquired distinctiveness over the Bollywood Reporter. In a practice known as "tacking on", the applicant claimed it could transfer distinctiveness to the new mark by virtue of its rights in the previously registered marks.

The original Trademark Examining Attorney (equivalent to the Indian TM Examiner) had held that THE BOLLYWOOD REPORTER was neither same nor legally equivalent to the THE HOLLYWOOD REPORTER.

The applicants appealed against this decision to the TTAB, arguing there was only "an inconsequential difference" between the two marks, that of a "B" instead of an "H", and contended that "the term Bollywood would not exist if it were not for the well-known use of the word Hollywood".

The TTAB refused to entertain these arguments, and pointed out that the marks were not legal equivalents:

"The marks at issue are not legal equivalents because they have different meanings and engender different commercial impressions. “Bollywood” is “the extravagantly theatrical Indian motion picture industry.” “Hollywood” is “the center of the American motion picture industry located in Hollywood, California.” THE BOLLYWOOD REPORTER means and creates the commercial impression of a news source regarding the Indian movie industry while THE HOLLYWOOD REPORTER means and creates the commercial impression of a news source regarding the American movie industry."

You can read more about the order at the TTABlog here.

Happiness in Germany too!

Elsewhere, and a little further back in time, via the Marques blog, the German Federal Patent Court kicked out an attempt to register the mark “Bollywood macht glücklich!” (tr: Bollywood makes you happy!), for reasons that the "slogan-type" mark was not distinctive enough to qualify for protection for film works and TV entertainment.

The Court held that the mark was only a laudatory promotional statement and did not indicate a specific trade origin. At best, consumers would understand the statement as an advertisement that the goods and services offered under the mark related to the Indian film industry, and contributed to feeling a sense of happiness.

Here, the applicants tried to argue that the mark was short, concise and not ambiguous, and that the stylization was distinctive, but were entirely unsuccessful. You can read more about the decision, which my three semesters of university German doesn't at all allow me to translate, here.

Bollywood, thou art truly original!

So, the Bombay, sorry Mumbai, Hindi film industry can rest assured that the name is still theirs to use in multiple avatars, including in the language of the Saxons. That said, I open this up to your thoughts, while mulling over some of mine -

It's disturbing to imagine what awaits, entertainment-wise, if this nomenclature is to be considered a measure of the industry's capacity for originality. Despite quality-control issues, that an international media house should attempt to register a mark for publications presumably intended for reportage on Bollywood is surely a sign that the Hindi film industry has come of age, and may actually be a threat to Hollywood?. (There is, interestingly enough, already a website by that name, and that's perhaps why this application was made?). I wonder, though, what of the Kollywoods, Mollywoods, Tollywoods, etc., of this world? Are they sufficiently distinctive too?