Updates : Lawaaris-Housefull Controversy- Cal HC says Saregama has the right to grant license!

Earlier this year, I had covered the interim Order passed by the Cal HC in the Lawaaris-Housefull controversy. Readers may remember that CJ Mohit Shah had opined that since the ramification of interpreting complex questions of law will be on the entire film industry, a detailed hearing can take place only after the vacations and had listed the matter on June 21, 2010. As per the information received from the insiders, the CJ had later released the matter from his list.

Turns out that on October 1, 2010 a Division Bench consisting of Justices Kalyan Jyoti Sengupta and Kanchan Chakraborty passed a Judgment in this matter holding that there is no prima facie infringment of the moral rights of the music directors Kalyanji-Anandji and that all the rights  in the literary, dramatic and musical and artistic work and the soundtrack and recording of the songs vest with Saregama and thus they had the authority to license the same to Nadiadwala Grandsons.A quick search on the Cal HC website reveals that the matter had come up on 28 June (after the CJ had released it from his list) and an adjournment was granted since Mr. Gautam Chakraborty appearing on behalf of Saregama was unable to bring his books due to unavoidable circumstances! Hearings were finally concluded on 22 July. This post will highlight the significant contentions and the observations rendered pertaining to the same. We will be shortly uploading the Judgment on the website but interested readers can go the Cal HC website and punch in APO 253/2010  to retrieve the same.

Before the present Division Bench, the following were the contentions raised by the parties:

Saregama :

1. The deed of assignment between film production house Prakash Mehra Productions and Saregama relating to the right of the soundtrack in the film Laawaris  was not being challenged either by Mehras or by Kalyanji-Anandji and others. The right given to Saregama was in the literary, dramatic and musical works embodied in the producer’s film and all Contract works but no right was given to exploit such literary, dramatic and musical work as embodied in the producer’s film in another film. If the deed was assignment was read carefully, it would reveal that the copyright in respect of literary, dramatic and musical works in respect of the song of Lawaaris was assigned to Saregama absolutely,entitling them to synchronize the song in any manner whatsoever without any restrictions.

 2. There was no question of infringement at all. Copyright is a bundle of rights and therefore the assignment deed gave Saregama the copyright, performance rights, all other rights,titles and interest embodied in the film.

3. Kalyanji-Anandji had absolutely no say in this matter under the law as they were engaged in a contract of service and had composed the songs in the course of their employment for which consideration was paid. There is nothing on record to show that Kalyanji-Anandji received any royalty in respect of the music composed for Lawaaris which establishes that they did not retain any right over the music composed.

EROS: 

1. The 1981 assignment deed transferred all rights to Saregama and the same was done without any limitation and included the right to adaptation as under the Copyright Act. Saregama has the right to exploit the songs in all possible manners including licensing the same for other films. Mehras had not right vested in them after the execution of the 1981 agreement as the agreement clearly stipulated that Mehras had to take the consent of Saregama to exploit the copyright.

2. Mehras were in law, the owner of both literary and musical works as per Section 2(d)(i) and (ii) of the Act and therefore, Kalyanji and Anandji can claim no right.

Mehras :

1. The 1981 assignment does not give Saregama the right to recreate, rerecord or synchronize the musical work, literary work (lyrics) and dramatic works embodied in the film Lawaaris. The words “re-record” or “recreate” or “synchronization” are not even mentioned in agreement dated 18th July 1981. Saregama not having derived any right to recreate or rerecord or synchronize could not have granted any licence in respect

thereof in favour of the producer and the distributor of the film Housefull or in favour of any other person.

2. The author of lyrics of the song ‘Apni To Jese Tese’ is Prakash Mehra, and director and composer of musical works is Kalyanji and Anandji. The Music Director of the song in the film Housefull  named‘Aap ka Kya Hoga (Dhanno)’ is Shankar Mahadevan, Ehsaan, and Loy Mendonsa. Author of the song is Sameer  and not Prakash Mehra, Kalyanji Anandji  This is therefore a  clear case of infringement of the copyright of the author and producer of the cinematographic film, Prakash Mehra.

3. Non-submission of royalty by Saregama is in the nature of continuing breach and therefore Saregama cannot claim or enforce any right under the 1981 agreement nor can it license or assign. Purusant to the judgment delivered in Gramophone Co. of India Limited v. Shanti Films Corporation (AIR 1997 Cal 63) , Saregama only had the copyright of the soundtrack and could assign only that and nothing else.

Kalyanji-Anandji:

1. Kalyanji-Anandji are the first owners of the copyright in the music as under section 17 of the Copyright Act and they would remain so unless they have assigned it in writing under section 19 of the Act. Mehras have not claimed anywhere that the music was composed under a contract of employment between Kalyanji-Anandji and Mehras. Saregama claiming the copyright over the music is totally absurd as the statements in the plaint have been verified by a person who was not even born at the time when the music was composed.

2. As per the decision in IPRS v. Eatern Indian Motion Pictures Association (1977) 2 SCC 820,  the producer is the owner of copyright in a cinematographic film and the composer remains the owner of the music. The producer cannot encroach upon the composer's copyright. The alleged assignment of copyrights of music of Kalyanji-Anandji under the 1981 agreement is invalid, void and not binding on Kalyanji-Anandji. In any event, the right conferred on Saregama is only the right on the sound recording and does not include the right to re-record, synchronize or exploit the song recording or the musical works.

3. Kalyanji-Anandji have special rights under section 57 of the Act which have been violated and thus this makes the ground for an order of injunction.

Judgment:

The questions before this Division Bench were therefore to ascertain the status of the 1981 agreement vis-a-vis Saregama and to determine if Kalyanji-Anandji retained the first ownership of copyright in respect of the song 'Apni toh jese tese'.

The Court noted that as per the agreement executed in 1981, it is clear that Mr.Prakash Mehra had transferred to Saregama, absolutely and beneficially, copyright for making records of all contract works, performing  right and all other rights, title and interest in and to the literary,dramatic and musical works embodied in the producer's film including all rights of publication, sound and television broadcasting of the said works. Therefore, the rights assigned was not merely confined to sound recording.Copyright of music is a bundle of several rights which includes a copyright of lyrics, music and sound-track.Once the music is impregnanted in the film,the copyright would subsist not only in the music but also the cinematograph film so far the portion of the song and sound recording are concerned. 

The Court also noted that the assignment of the rights to Saregama was with respect to all things in future years to come and even to include modern technological medium or method of recreating the sounds either in its original form or by synchronization

The Court further noted that the Mehras were in receipt of royalty pursuant to the royalty agreement for synchronization of songs as recent as February 2010. Mehras were also cognizant of the fact that the song 'Apni toh jaise tese'  has been allowed to be used by synchronization in Houseful. Mehras never really disputed the 1981 agreement although there was a complete denial of the factum of the existence of such an agreement in an earlier suit filed in Bombay. Accordingly, it is very clear that  Saregama is entitled to grant license to any person and as such no prima facie case of  infringement of copyright can be made.

As far as the status of Kalyanji-Anandji is concerned, the Court held that it is not in dispute that they are indeed the composers of the music of the film Lawaaris as well as the song 'Apni toh jese tese' However in the light of the 1981 agreement, it is clear that Mehras lawfully assigned the copyright in the music as well. It is also to be noted that no document was produced either by the heirs of Kalyanji or Anandji or the heirs of Mehra regarding the nature of engagement between Mehras and the music composer. Mehras nowhere stated that the duo retained the right of first ownership and hence prima facie, the conclusion is that the engagement was in the nature of contract of service.

The Court opined that while it is true the composer becomes the first owner of the copy right of the music but when a composer does any work in course of the employment of contract the employer shall in absence of such contract or agreement providing specific term, becomes the first owner of the copy right thereof. In the absence of the exact nature of engagement of the music composers, the  question of infringement of the composer’s copyright or for obtaining the permission or written assignment, at this stage, does not and cannot arise. There was also no question of violation of the moral rights of the composers as the Trial Judge did not find any mutilation or distortion of the song. The Court observed that the modern jurisprudencial approach with regard to ownership of author’s copyright in literary and musical works, is recognition of two rights – author’s economic right and moral right. Even after lawful transfer of former, the ownership of later remains with author and it is protectable under law against any distortion or mutilation.

The Court thus set aside the injunction passed by the Trial Judge with the stipulations as given by CJ Shah in the earlier Order. As of now, none of the parties have appealed against this Judgment.

SpicyIP Tidbit: Tamil Writer Claims ‘Enthiran’ as Stolen Story of His Tale

Tamil writer Aroor Tamilnadan, whose pen name is Amudha Tamilnadan claims copyright Just weeks after superstar Rajinikanths latest blockbuster 'Enthiran (Robot)' hit screens worldwide. The writer lodged a complaint with the Chennai Police Commissioner that 'Enthiran' is based on the short story written by him under the title 'Jughiba', published in a Tamil magazine 'Iniya Udhayam' in 1996, and again in ‘Dhik Dhik Deepika’ magazine in 2007. According to him, Director and producer of “Enthiran” stole the uncooked story from his novel and supplemented elements to the film like fights, songs, and graphics.

Producing printed copies of both publications as proof, Aroor Tamilnadan mentioned : without having any permission, making a film based on a short story which appeared in a registered magazine, amounted to violation of copyright. He urged the police to file a criminal complaint under section 63 of the Indian Copyrights Act.

Mother Dairy Brand not to be used by Private Company: says Delhi High Court

A few months have passed since the Delhi High Court had passed judgment in a case that promised to be quite a landmark in the so-called ‘White Revolution’ in India. Pronounced on August 25, 2010, this matter, titled Mother Dairy Fruits & Vegetables Pvt. Ltd. & Another v. M/S Maa Baishnavi Enterprises & Others [I.A. 280/2009, 8864/2009 and 8865/2009 in CS(OS) 41/2009], was decided by Justice Ravindra Bhat, a well-known name in the Delhi High Court IP decisions.

The plaintiffs had filed this suit seeking permanent injunction to restrain the defendants from using the trademark “MOTHER DAIRY”, which the plaintiffs had adopted in 1974 and used without break since then. The Federation, which was one of the defendants, had been permitted by the plaintiff vide an agreement to use the mark for the period 1978 to 1996, but only for liquid pasteurized processed milk with territorial restriction of use in West Bengal. However, the plaintiffs alleged that the Federation had violated the terms of the said agreement by allowing the other defendant, viz. Baishnavi Enterprises (a distributor of the Federation) to market its products in Jharkhand using the same mark.

On January 12, 2009, the Delhi High Court had passed an ex-parte injunction preventing the defendants from using the mark or name “MOTHER DAIRY” in respect of pasteurized milk or any other type of milk or milk products in any State other than West Bengal. Meanwhile, the Federation had filed a separate proceeding, being CS (OS) 57/2009, before the Calcutta High Court, wherein a decree had been pleaded for that the territorial restriction placed upon the Federation there had been done so under misrepresentation and mistake. In this case, the defendants contended that their use of the mark “MOTHER DAIRY” was entirely legitimate, since it has a strong descriptive or generic content in relation to milk products, as had even been acknowledged by the court in Mother Dairy Fruits and Vegetables Pvt. Ltd. v. Gujarat Cooperative Milk Marketing Federation [I.A. No. 1329/2005 in CS (OS) 217/2005].

It was also contended by the Federation that the plaintiff, being obviously aware of the use of the mark in West Bengal by the Federation from 1974 onwards, couldn’t possible claim exclusivity regarding the same. Although the original agreement for usage was from 1978 to 1996, the usage in reality was practiced till a new agreement had been made on September, 2004 and the plaintiff had never objected to such usage. Such knowledge and implicit consent by the plaintiff, therefore, argued the defendants, disentitled them to injunction. Also, the plaintiffs’ pre-dominant market was in Delhi and nearby region and did not cover the eastern part of the country, wherein the defendants had used the mark.

Defendants thus urged that it would be just and expedient to stay current proceedings till the matter CS (OS) 57/2009 be decided by the Calcutta High Court. Such stay could be granted under Section 151 of CPC, with precedents existing in the likes of Manohar Lal Chopra v. Rai Bhadur Rao Raja Seth Hiralal (AIR 1962 SC 527), Bhagatram Goel v. Gupta Cables Pvt. Ltd. (AIR 1977 Cal. 451) and Banshidhar Naik & Ors. v. Laxmi Prasad Patnaik (AIR 1966 Or. 53).

Justice Bhat considered the relevant portions of the agreement between the plaintiffs and the Federation dated September, 2004 as well as the letter written by the Federation to the plaintiffs on March, 2005 to reach the following conclusions: The plaintiffs had coined the mark “MOTHER DAIRY” in 1974 and had been using it since then regarding milk and milk products, the mark had been registered, the plaintiffs and the defendants had an arrangement whereby the mark was to be used regarding the Federation’s products in West Bengal between 1978 and 1996. Post that period, there had been no such arrangement till 2004, when the parties had entered into another agreement that the Federation could use the mark for liquid pasteurized and processed milk marketed in West Bengal and that the Federation’s subsidiary would not use the market for sale of such product in West Bengal. Finally, on March 2005, the Federation had let the plaintiffs know that it was formally launching a brand “BENS”, which prompted the plaintiffs to complain that the Federation was violating the territorial restriction agreed to by the parties in the 2004 agreement, by distributing its products through the other defendants outside West Bengal.

The court had appointed a Local Commissioner to visit the defendants’ premises whereby it had been reported that the Federation’s products were indeed being marketed in Jharkhand. Thereafter, the court held that the Federation’s argument about the plaintiffs’ apparent acquiescence being their estoppel from claiming injunction was unfeasible. It had been proven that the plaintiffs had coined the mark in 1974, had been using it ever since and were the proprietors of the registered trademark. The defendants, after all, had not been contending to have applied for rectification or cancellation of the mark.

Moreover, the agreements in 1978 and 2004 amounted to the Federation’s acknowledgement of the plaintiffs’ exclusive rights over the trademark, while the latter agreement also confined the permissive use by the Federation to the State of West Bengal and prevented any Federation’s subsidiary from using the mark in respect of its products. In the light of such development, the court believed that the rule in Ziff-Davis Inc. v. Dr. D.K. Jain and Ors. (1998 PTC 739 Del.) ought to apply in the present case, i.e. the defendants’ use of the mark or the use by the licensee or the permissive user should inure in plaintiffs’ favor.

With regard to the generic argument that milk food is descriptive and the reliance placed upon by the defendants on the order in the Gujarat Cooperative Milk Marketing Federation, Bhat opined that in that matter, the court had in fact acknowledged that if injunction were not granted, the plaintiffs, i.e. Mother Dairy were, as in the present case, bound to suffer irreparable loss to their established business reputation and had even rejected the plea of delay and laches taken by the defendants in that case. Reading together this view expressed by the court in that matter, with the final order therein (by which the defendants had been restrained from manufacturing, selling, offering for sale, advertising and supplying milk and milk products and no sale had been permitted under the trade mark “MOTHER DAIRY”, especially in Delhi), Justice Bhat believed that it would be apparent that the latter part was not in any manner restrictive of the injunction made applicable. Hence in the present matter too, it was held that the plaintiffs being the proprietor of a registered trademark that had not been challenged through any known legal procedure, the defendants cannot contend that the plaintiffs were disentitled to interlocutory protection.

The pleading for stay of proceedings was also rejected by the court. Bhat, J. observed that although the decisions cited by the defendants regarding S. 151 of CPC did enable the Court to stay the proceedings, nonetheless, each case needed to be seen from the subjective facts presented before the Court. In the present case, the defendants undeniably acknowledged the plaintiffs’ rights, as far as back in 1978 and later entered into an agreement in 2004 for use of the mark. With the defendants having violated the territoriality agreed to by the parties in the said 2004 agreement the subsequent suit filed by the defendants was nothing but a mere attempt to stall the present proceeding. The interim injunction granted to the plaintiffs was thus confirmed by the court in its terms and was held to bind the defendants till final disposal of the suit.

Spicy IP Tidbit: WIPO launches new Database for profiling IP case Studies

About a month ago, WIPO had added yet another new entrant to its growing count of databases facilitated to promote and enrich overall development and experience of IP throughout the world. Named IP Advantage, this database seeks to profile and showcase the IP-related experiences of inventors, entrepreneurs, and researchers. The broader purpose behind such an initiative is promote a better understanding of the manner of creation and protection of different types of IP as also the modes in which individual inventors as well as the entire society are aided by the existence of the global IP system.

The database itself, like WIPO’s earlier creations such as WIPO Lex, promises to be a fully searchable user-friendly free one-stop gateway to a huge collection of case study material that is available on WIPO’s website. These cases collectively provide a demonstration as to the way in which IP is dealt with in the real world and how IP rights can be used to foster and promote innovation in nations developing and developed. The case studies have been presented in a standardized format designed to provide one an inkling as to the various steps involved in the innovation cycle itself, viz. innovation, IP protection, exploitation of innovation and resultant further innovation and so on and so forth. The overall scenario includes a wide range of topics, including branding, financing, partnerships and research and development from many corners of the world (at present, there are more than 100 case studies covering the jurisdictions of as many as 48 different countries, with more and more new studies being added regularly). On another welcome note, some of the case studies included also highlight the ways in which the IP system can facilitate coming up with solutions to global concerns such as climate change, food security and public health etc.

The database has an intuitive interface that allows for searches to be made according to type of IP, the object of protection and the focus area of the case study etc. It’s a part of the initial returns out of the WIPO Development Agenda projects that had been consented to by member states in the later half of 2009. The funding for the database and the idea itself have originated from the Japanese government, with French and Spanish versions of it under development at present.

Further inquiries regarding the database can be made at the Media Relations Section at WIPO [Tel: (+41 22) - 338 81 61 or 338 95 47, fax: (+41 22) - 338 82 80]

SpicyIP Guest Post: High Level Committee recommends a 'three-strike policy' and other measures to curb piracy

Thanks to Sai Vinod Nayani, our serial guest blogger, we have this very interesting post on a recent report by a High Level Committee on Piracy. Apparently this committee has recommended that India adopt a 'three-strike' policy to curb internet piracy. Readers who have a copy of the report are requested to please pass on a copy to us.

Measures to Tame the Pirate Mafia: RECOMMENDATIONS OF THE COMMITTEE ON PIRACY
by Sai Vinod Nayani

The high profile committee set up last December by the Ministry of Information & Broadcasting having the likes of Mr. Yash Chopra and Mr. Manohar Shetty and headed by the Special Secretary of the Ministry Mr. Uday Kumar Varma to suggest measures to combat video and audio piracy has submitted its report last August. The recommendations according to the press release are measures to make “piracy substantially risky and financially unattractive”. The following are the recommendations of the committee:
Source: Image from here

(a) Three-Stage Strike Model for ISPs
The Committee recommended “action against errant subscribers” by ISPs adopting a “three stage strike model” but nothing was spelt out regarding its working. A similar policy is already in place in certain Western democracies and the same has been endorsed in the latest draft of ACTA. The ISPs issue warning notices with conclusive evidence to its subscribers infringing copyrights and would take down connections on repeated infringements. A record of infringers is maintained by the ISPs and this would be disclosed to the copyright holder who further can take recourse to courts for damages. This would greatly compromise privacy on the internet and this measure has been termed as “draconic” by human rights groups. Mindful of India’s vehement opposition to ACTA and its willingness to go to any extent to “sabotage” the negotiations for various reasons, implementation of this policy is unlikely.

(b) Prohibiting Cam-Cording Devices
Film-makers bank heavily on openings for recovering costs and protection from leakages is vital. The Committee suggested that an obligation be placed on theatre owners to ensure that no viewer would use cam-cording devices during the screening. However, there are numerous instances where the theatre operators themselves have facilitated such recording straight from projector cabins. It would be meaningless if action is not taken against such operators. The industry has recently witnessed instances where audio and video was available on the internet before its official release and this cannot be possible without the help from the people within.

(c) Conversion of traditional theatres into digital theatres in smaller towns
This has a favorable impact streamlining distribution and associated costs. Furthermore, leakages by unauthorized conversion of traditional reels into beta version and from that to DVDs can be plugged. Digitalization is inevitable in the future and as pointed out by the committee over 3000 theatres have already been converted. Hence, any resistance from operators should be overpowered and the process should be completed.

(d) Reducing the cost of legitimate optical discs and simultaneous release of DVDs along with theatrical release in big cities to “make piracy unviable”.
Keeping in view the accessibility and affordability of optical discs by the consumers, the Committee suggested a laudable move to lower prices without compromising on the quality. Such a move obviously would discourage people from purchasing pirated copies. However, it is hard to match the pirated copies as associated cost in making such copies is just the disc. So, the prices of original copies should be competitive to pirated copies and this allows very little scope to exploit commercially.

According to the prevailing practice in the industry, the movie is first released in theatres followed by transmission through cable and satellite and finally through discs. This enables film-makers to exploit each window at a time. Simultaneous releases have been tested before and results have not been inspiring. There is a great risk of eating up revenues from each other widows for the simple fact that there exists an opportunity for multiple viewing using a disc and the same is absent with theatre releases. The threat of piracy should not be forgotten. Hence, the focus of reform should be towards protecting leakages at each window.

(e) Licenses for Cable Operators
Transmission of latest films through the cable network without copyright license (sometimes hours after theatre release) is a common site in most parts of the country. An amendment to Cable Televisions Networks (Regulation) Act shifting from the existing mandatory registration to license has been suggested. However, relevancy of such move in eliminating piracy is unclear. Under the existing system it is illegal and criminal liability is attached to anyone operating a cable network without registering. Further, government has the power to prescribe a “programmme code” which if not adhered attracts imprisonment. Introduction of licensing system would do nothing different from the existing framework. Furthermore, there is no justification for government intervention in aspects other than ones incidental to cable operation and it should instead focus on effectiveness of these provisions since it has been over a decade since these measures have been introduced.

(f) Preventive Detention of Pirates
In the last decade states such as Maharashtra, Kerala and Tamil Nadu have enacted laws authorizing preventive detention of pirates equating them to “Goondas” and Andhra Pradesh is contemplating such a move. The competency of state legislature in enacting such laws has been questioned before the Madras High Court. However, these measures have not demonstrated any signs of improvement at the ground level. Burma Bazaar in Madras still continues to be the biggest hub for video piracy. Piracy is an organized crime and it funds terrorism. The impact of preventive detentions would be limited to the surface and it does not weed out the root cause because the big fish would still be at large.

(g) Miscellaneous
The Committee has also suggested the Ministry to support and encourage initiatives such as the “Alliance against Copyright Theft”• Furthermore, it called for sensitization of police, judicial and administrative officials on related laws and efforts to up-scale training and capacity building to minimize violations. Another measure irrelevant to curbing piracy is the online registration of films with the Copyright office or in the alternative admitting censor certificate as evidence of copyright.

CONCLUSION
It is common sense that as long as there is a demand from viewers and in the absence of adequate supply through legitimate means, there is always fuel for piracy markets considering quality has no impact on preferences of majority consumers. So, the cumulative effect of measures should have a dual effect decreasing the rate of piracy and at the same time incentivize the operations to make counterproductive measures harder to succeed and the recommendations falls short on this aspect although it seemed to have made in this direction.

Is the IPAB above the RTI Act, 2005?

It has been five years since Parliament has passed the Right to Information Act. The legislation which gives citizens a right to demand information from the Government has been a tremendous success across the board, right from the grass-roots level to the power-centre in Delhi. It however appears that this information revolution has swept past the website of the Intellectual Property Appellate Board (IPAB). Sections 3 & 4 of the RTI Act, 2005 requires all 'public authorities' to maintain on their websites details of the 'Public Information Officers' along with the procedure for filing RTI Applications.

A perusal of the websites of the Supreme Court of India, the High Courts of various states, the Ministries of the Central Government, the Patent Office indicates that all of them have published the relevant RTI information on their websites. The IPAB website however does not carry any such details although the IPAB is a 'public authority' as defined in the RTI Act since it has been established by a law of Parliament.

Section 18 of the RTI Act, 2005 allows an aggreived party to approach the Central Information Commission and demand action against the IPAB for its failure to provide this information on its website. Any volunteers?

Brin Panna & The Jungle of Oppositions- I

For the purposes of this post, let’s have a few characters- Brin Panna is the protagonist and Peeve Jobs is the antagonist (Poltergeist, may be). And let’s call the story- “The Obvious Indian Patent Story” and this chapter of the story as “Brin Panna & The Jungle of Oppositions”...

Brin Panna- The Ideal Indian

Our hero Brin Panna swears by “Indian values” such as honesty, a Lutheran work ethic and progress through innovation. He runs a home-grown “swadeshi” entity fully “manned” by women, which manufactures spindles, especially for the sacred Indian fabric, "Khadi".

Panna’s Tryst With Destiny

At the stroke of the midnight hour, on the 15^th of August, 2007, when the world is asleep, Brin Panna has a “Eureka” moment (basically, he’s having a bubble bath...) and comes up with an idea for a spindle which spins stronger yarn and produces softer khadi. The limitation in the prior art was that loosely spun yarn was soft, but not strong enough, and tightly spun yarn was strong, but not soft enough.

So, Panna devises a method of spinning which produces soft and strong yarn, and a spindle based on the method. He decides to name the technology “Spin-sutra” for the Indian market and “Spin-ster” for the western market.

Panna’s new Indian values tell him that this technology should be distributed with both arms, but not as alms, to the Whole Wide World; the die-hard patriot in Panna asks him to learn from the mistakes of the past, and says an Indian should be seen as a pioneer and promoter of this technology at conceptual and commercial levels. So, he files for an Indian patent and a PCT application as well for patents in Pakistan, China, Bangladesh, Nepal and Sri Lanka, among other friendly nations.

Peeve Jobs- At Work Round The Clock

Enter Jobs, Peeve Jobs- a foreign national who runs an entity called “The P Buster”. Jobs’ business model is simple- he is funded by competitors of Indian patentees to bust Indian applications/patents or subsequently frustrate the purpose of the grant of the patent in one way or the other.

It works well both ways for Jobs and his benefactors- Jobs gets the money and the vicarious pleasure of making others’ lives miserable; as for Jobs’ donors, the logistics of opposing a patent/application have been outsourced effectively.

Jobs is now funded generously by his benefactors to invest his energies and resources in making Brin Panna’s life miserable. Unfortunately for Panna, the Indian Patents Act, 1970 hands enough and more ammunition to Jobs as he clinically and meticulously goes about his job.

1. First, Jobs can employ the pre-grant opposition mechanism without spending a shilling on the “representation” and there’s no limit on the number of representations he can make under the Act.

2. Jobs gets particularly aggressive when the value of the invention is high, such as Panna’s “Spin-ster” technology; it is exactly in situations like these that Jobs feels he owes a lot to the drafter of the Indian Act, because the Act does not bar him from filing as many oppositions as there are grounds under Section 25(1). He really doesn’t need to bother if every ground of opposition is even relevant to the patent application in the first place

3. And not just that, he can use every ground of opposition multiple times citing different pieces of prior art (but for timely interventions by erudite sides of the Court). Added to that, Jobs may seek a hearing as well in addition to the written representation and evidence.

4. Jobs can also take joy from the fact that there is no specific time limit for the disposal of each opposition.

5. Before we forget, Jobs can have fun right until grant of the patent, which he knows, will take its own sweet time thanks to other chums of Jobs at work, who contribute their mite/do their bit to increasing the docket of pending applications.

So Jobs gets down to work with an energy that would put Lucifer, the Devil himself, to shame, and files one opposition after another. Panna, on the other hand, goes through a harrowing period, because what was intended to be a system of opposition to ostensibly further public good, has become a lethal tool of inquisition to keep the good away from the public.

Jobs earns a formidable reputation as the defender of public interest- He and He alone stands between Panna’s all-devouring sinister “Spin-ster” technology and public good. Panna realizes that it’s perfectly alright for Jobs to make money out of opposing his patents/applications, but what is bad is Panna earning out of his own honest efforts.

But Panna still holds on to his faith in the system and somehow manages to see his application through. An Indian patent “120420” is granted in the fag end of 2011. Panna thinks his faith in the system has finally paid off...or so he thinks

Panna doesn’t realize that the Indian Act (Section 13(4)) does not impute any presumptive validity to a patent even if the grant is the consequence of the rejection of a pre-grant opposition. This basically means, that Jobs can continue to torment Panna for a good one year from the date of publication of grant of the patent, using the very same grounds that were raised in the pre-grant opposition. 

Oh again, Jobs may not be the only one who’s hell bent on raising hell for Panna.

Panna somehow again manages to save his patent only to realize that the Act still does not impute presumptive validity to his patent, which has not been merely registered, but has been granted pursuant to rigorous examination (atleast on paper).

Jobs comes up with yet another way of preventing Panna from enjoying his rights peacefully. He deliberately infringes Panna’s patent "120420" and files a counterclaim of revocation in response to Panna’a suit for infringement.

The opposition Agnipareeksha rule evolved by Courts may come to Panna’s rescue, but does this necessarily translate to grant of an interim injunction against Jobs? We’ll discuss that in the next post.

Thoughts

One is not against the system of oppositions, I just think the balance needs to be set right, particularly considering Indian conditions. It is ironic that India chose to bring in a pre-grant opposition system, when most jurisdictions were phasing it out.  

It is also ironic that our legislature deemed it necessary to provide for a certificate of validity under Section 113 (when the validity of a patent has been contested and upheld), but has not deemed it necessary to make such a provision for an application that has survived an opposition proceeding.

The earlier system of opposition, to me, was much more rationalized; under the earlier system, oppositions were invited after the Patent Office had made up its mind to grant the patent. Once the option of opposing the application had been exhausted, the only way to revoke a patent was to file a revocation proceeding under Section 64.

Contrast that with the situation today where an application and the subsequent patent are buried under layers and layers of scrutiny, with the already prevalent air of uncertainty around anything that relates to patents, be it office practice or substantive law, complicating the situation.  

Funnily, despite such a rigorous procedure, the Act expressly denies presumptive validity to a patent. Consequently, Courts have been forced to read in presumptive validity of some sort for a patent which has survived oppositions.

Instead of encouraging and incentivising innovation, these multiple layers of oppositions could end up robbing the system of patents of its purpose. A few ways of dealing with this could be:

1. To either do away with pre-grant opposition and replace it with post-grant opposition and subsequent imputation of validity or;

2. To retain pre-grant opposition and impute validity after the application survives the opposition, and doing away with a post-grant opposition.

The second option may be much more feasible and practical because it would attach sanctity to grant of the patent. After all, there ought to be a difference between mere registration and grant pursuant to examination/opposition.

Praveen Raj files rectification petition with GI Registry against the 'Tirupati Laddu' GI

One of our frequent readers Mr. Praveen Raj, a scientist with the CSIR has filed a rectification petition with the GI Registry requesting the cancellation of the 'Geographical Indication' status granted to the Tirumala Tirupati Devasthanam (TTD), a trust recognized under local laws, for one of its prasadams, or holy offerings - the famous 'Tirupati Laddu'. The grant of the GI status to the Tirupati Laddu was a controversial affair from the very beginning. We've covered the issue over here.

Our readers may remember that Praveen Raj had filed a PIL in the SC on the same point a year ago and subsequently withdrew it since a similar PIL has been filed before the Madras High Court by another person. However as reported by us over here the Madras High Court had dismissed the petition on the ground that there already existed an alternate and efficacious remedy, in the form of the Registrar of GIs or the IPAB was available to the Petitioner. Praveen Raj then petitioned the IPAB to invoke its suo-moto powers to revoke the G.I. status granted to the Tirupati Laddu. The IPAB wrote back to him stating that they didn't have such powers. We've blogged about it over here. So, after a year of petitions before all the wrong forums, we finally have a relatively well-drafted rectification petition before the appropriate forum.

The main grounds taken up Mr. Praveen Raj in his petitioner, accessible over here, are as follows:

(i) That the grant of GI status is violative of Section 11(1) of the GI Act read along with Rules 32(5) & 32(6)(a) & (f) since a GI is supposed to be a collective right to a community of producers. In the present case however the GI status has been granted to the TTD which is a single entity.

(ii) That the grant of GI status to the 'Tirupati Laddu' violates Section 9(a) & Section 9(d) of the G.I. Act i.e. it is likely to deceive (Section 9(a) and that it is likely to hurt the religious susceptibilities of a certain section of society (Section 9(d).

(iii) That holy offerings like prasadams/laddus cannot be construed as 'industrial goods' thereby excluding them from the purview of the GI Act.

Mr. Raj's strategy to file this petition before the G.I. Registry is questionable since this is the same authority which granted the G.I. status in the first place. Bureaucrats rarely like to admit to their mistakes. It may have therefore been a better stategy to file it before the IPAB as it would probably been more objective than the Registry. Regardless of strategy, Mr. Raj's petition is important because I think it is the first of its kind i.e. no such petitions have been filed before the Registry earlier. Given the deadly mix of religion and the law in this case I am sure it will be an interesting ride to judgment day. We'll keep you posted on the latest.

Early Bird Catches the Worm : Hurry and Register for the Workshop on Innovation,Creativity and IP Policy

For those of you who haven't registered for the fabulous forthcoming workshop on Innovation,Creativity and IP Policy as announced by Mathews here,  HURRY!!!

This year the NUJS IP Chair is collaborating  with the Max Planck Institute for Intellectual Property, Competition and Tax Law for a  two-day Indo-European dialogue on “Innovation, Creativity and IP Policy”,to  be held at NUJS on 19th and 20th November, 2010. 

The Workshop is being sponsored by Microsoft India (chief sponsor), K&S Partners and Altacit Global. 

The Workshop has lined up interesting speakers to take on some of the most challenging IP and competition issues.

So please rush and register!

Registration fee for Academic / Research Institutions: Rs. 2000 /-

                           for Corporate and Others                 : Rs. 4000 /-

Registration fee has been waived for students registered for courses at any university.

*Note that the fee is inclusive of conference kit, lunch and coffee on both the days.

The registration fee may be sent by Cheque/DD in favour of “NUJS IP Chair” to Prof. Shamnad Basheer, NUJS, 12 LB Block, Sector III, Salt Lake, Kolkata – 700 098.

Deadline for receipt of registration fee: November 1, 2010.

Don't forget to drop me an email  at shayonee@gmail.com, if you intend to register.

We look forward to hosting you all for the fantastic two days in November!

Google Launches Legal Music Search for India to Fight Piracy

In a spectacular move, Google announced yesterday, the launch of a music service in India to help users search for legal online music streams and downloads.

Our readers might remember a post from a week ago titled 'Copyright Infringement is not Theft'. The post led to a rather passionate discussion in the comments section about the rampant piracy in India with some comments suggesting that people were just not willing to spend money on a legal purchase when they could pirate music for free from the comfort of their homes . I argued that this was in fact not the case and the problem was simply that there are no online legal alternatives available to people in India, in case they wanted a digital copy of their music or wanted to listen to music on their computers (iTunes does not allow downloads of music/video in India - only applications). But this no longer seems to be the case .

Here is a quick run down on what the service entails. The official Google India blog reports that the service is currently in labs (meaning there is sure to be further product development in the coming months). Using the Google Music Search India service, anyone (even those living outside India) can search for Bollywood/Hindi songs from current hits to old classical numbers. The song will then be streamed by Google's partners, and there is no restriction on the number of times you can stream the entire song. I consider this significant because in the US, Google only allows short previews of the songs to be streamed. A pop-up web player will be used to stream the track so there is no requirement to download any additional software or music player, which I feel is another significant feature for the reason that 'convenience' has always been advanced as a reason for illegal music being downloaded. But illegal downloads involves considerable risk in the form of viruses along with the need for additional software to download and play the music in most cases. With the idea of a pop-up player, Google appers to have struck at the heart of the problem - convenience, and shifted it in its favour.

Currently, Google's partners include SaReGaMa, In.Com and Saavn.com and as stated in the Google blog, you can 'listen to songs sung by Kishore Kumar or Shreya Ghoshal or just all songs from the movie Buddha Mil Gaya'. While the service can be accessed at the site http://www.google.co.in/music I think Google has taken an additional step with plans to integrate the service into its main search so that when someone searches for a particular track, instead of feeding results from sites hosting content illegally, the results will instead display links from the Google Music Search Engine service.

There is no doubt that the service is completely legal, since the aforementioned lables are Google's partners and have a license to stream music online. One can only hope that more join as partners.

As for downloads, the service does not currently provide download links. However, I think this is a relatively unimportant factor, since several people already use sites like Grooveshark to stream their music, given the increasing broadband internet speeds today. Further, with the expected launch of Google Music, and Google indicating that it takes Bollywood music seriously, I think it is only a matter of time before legal downloads for Hindi/Indian Classical and other Indian music becomes available at a reasonable price.

While I'm sure Google didn't get the idea from our discussions on SpicyIP, I'm satisfied that at least the music labels and corporations are listening to consumers and policy makers alike and working together to fight piracy by making legal alternatives available to users in India. Whether such efforts will help curb digital music piracy in India remains to be seen, but I have a feeling that we are moving closer and closer to a situation where illegal downloads are not going to be the first choice.

Thou shalt be heard: says Bombay High Court in Patent Abandonment Case

A few months back, the Bombay High Court had passed quite an interesting judgment regarding procedural complexities in a matter involving a patent application filed by a Spanish University. Dated February 26, 2010, this matter (Writ Petition No. 1435 of 2007) had the Universidad Politechnica De Valencia (hereinafter the Petitioner) on the one hand and Union of India, the Controller General of Patents & Designs and the Assistant Controller of Patents (hereinafter collectively the Respondents) on the other.

The Petitioner had filed a patent application on October 16, 2002 numbered IN/PCT/2002/01424/MUM and had claimed priority from Spanish Patent Application No.P200001102 dated April19, 2000 in the officially prescribed manner. A request for examination had been filed in Form 18 on March 15, 2005 and the resultant First Examination Report was issued by the Respondents on June 15, 2005.

The Petitioner contended that the application ought to have been placed for grant by December 15, 2005 according to the prevailing law. The original application contained the request that no adverse action should be taken against the Petitioner without giving it at least 10 days in advance of a hearing. The said report contained objections raised by the Respondents, to which the Petitioner had replied on November 25, 2005. However, on December 13, 2005, just a day before the application was to be placed for grant, Respondents initiated further action and intimated certain other objections vide letter. This last-minute objection didn’t allow the Petitioner to file a response by December 15, since the Petitioner had been based abroad. On application for extension, further time had been granted and the Petitioner managed to file a response to the new objections on January 4, 2006, along with the same request of being granted a hearing before any adverse decision was taken in the matter.

On January 24, 2006, new objections were issued by the Respondents, along with the intimation that the last date for putting the application would expire on March 12, 2006. On March 3, the Petitioner applied for grant of an official hearing, which was received by Respondent No. 3 on March 6, followed by exchange of correspondence. Petitioner had claimed that necessary amendment had been carried out as per the objections, despite the vagueness of such objections. Subsequently, the Petitioner was informed that his application was deemed to have been abandoned vide an order u/s 21(1) of The Patents Act, 1970 (hereinafter the Act), for not meeting the requirements as set out in the order.

The Petitioner had further submitted that the said objections were only concerned with clarity of the words, which was not a fatal error and Sections 3 and 4 of the Act had not been invoked. The review petition filed by the Petitioner against that order had been summarily rejected w/o giving any opportunity to the Petitioner of being heard. However, according to the Petitioner, since Respondent No. 3 had been functioning in a quasi-judicial capacity in this matter, the latter should have given a hearing to the Petitioner and should also have rendered “a speaking and reasoned decision based on justifiable and cogent grounds, as opposed to passing an order in an administrative and mechanical manner without application of mind.” The Petitioner had contended that the two orders of abandonment and summary rejection were entirely without jurisdiction and/or amounting to failure to exercise jurisdiction and consequently they should be set aside, with the Petitioner being given an opportunity of being heard.

In reply, the Respondents argued that the reply to the final objections and reasons for hearing was made by the Petitioner not before 10 days of the last date, viz. March 15, 2006 and hence as per Section 80 of the Act, it was not obligatory on the part of the Controller to give personal hearing. In return, the Petitioner had relied on several judgments, such as Intel Corporation vs. Union of India & Ors. (Writ Petition No.368 of 2007), Teijin Limited vs. Union of India (Writ Petition No.228 of 2007) and Novo Nordisk A/S. vs. Union of India & Ors. (Writ Petition No.2105 of 2006) etc., wherein the Court had set aside orders of the Respondent No. 3 on the ground of the Petitioner not having been granted hearing. Moreover, the last response having been dispatched on March 3, 2006 and received in the office of the Respondent No.3 on March 6, 2006, the Petitioner urged that it was within the prescribed period of 10 days, the last date being March 15, 2006.

The two matters on which the Court pondered were whether the action of Respondent No.3 in denying the Petitioner a hearing on the ground that the request for hearing had not been made before 10 days of the last date was within jurisdiction and whether the Revision Application could be decided at all without giving a hearing to the Petitioner.

To answer the same, the Bench, comprising Justices A.R. Joshi and Ferdino I. Rebello, examined Sections 21 and 80 of the Act and also Rules 28, 28A, 29, 30 and 129 of the Patent Rules, 2003 (hereinafter the Rules). With regard to the first question, the Court held that an application could be abandoned u/s 21 only if no response had been filed to the objections raised within the time period mentioned in S. 80. In the present case, the response had been filed within the time period of March 16, 2006, though received by the Controller within 10 days before expiry of due date, and the Court believed that S. 21, while creating a deeming fiction of abandonment, had two aspects to be considered: “One to treat the application as abandoned in the event the response is not forwarded to the Controller within the time when the objections are made known. The second, if it is the contention of the petitioner that he has complied with the objections, can the Controller hold that the Patent is deemed to have been abandoned without giving a hearing to such applicant?”

To such a question, the Court replied that S. 21 would require judicious exercise of discretion on the Controller and as such, all judicial or quasi-judicial authority ordinarily, in the absence of a statutory bar, can decline to hear a party in respect of civil proceedings. Thus S. 80 involves statutory recognition of the inbuilt element of hearing within the exercise of discretion, i.e. if discretion has to be exercised, then hearing has to be given if the request is made within the time stipulated by the provisions. As per Rule 28(1), if an applicant requests for a hearing regarding contesting the objections communicated to him, he has to be given such an opportunity. Proviso to R. 28(2) requires such request to be made on a date earlier than 10 days of the final date of the period referred to in S. 21(1). However, apart from this, the Controller also has the power vide R. 30 to grant hearing on a request being made by the applicant at any time before the matter is decided, as also a requirement u/R. 129 that before exercise of any discretionary power, the Controller shall give such applicant a hearing after giving him 10 days notice of the same.

A combined reading of Sections 21 and 80 along with Rule 28(2) would thus mean, according to the Court, that the claim for hearing must be made within a time as specified in the proviso to the S.21 and the Rule. If a request is made within the time as framed, the Controller has to give a hearing, since the operative word used is "shall". However, that does not exclude the right of hearing in other cases if sought even after the prescribed time. The right of hearing is inherent in any discretionary exercise of power, as has been separately recognized in Rules 30 and 129.

Thus the order by the Respondent No.3, holding that the Petitioner’s application was deemed to be abandoned was clearly without jurisdiction and hence liable to be set aside. Even in case of a review, the quasi-judicial authority concerned has to provide the parties involved an opportunity to be heard and thereafter, has to pass a speaking order backed by specific reasons which had not been done in the present case, thereby rendering the order dismissing the application for Review also liable to be quashed and set aside. The matter was thus finally remanded to the Respondent No.3 to hear the Petitioner herein after giving a proper opportunity as contemplated under the Act and the Rules and thereafter to decide the matter according to law.

Delhi High Court raises the threshold for trademark dilution suits

In a surprising, yet welcome, judgment, Justice Ravinder Bhat of the Delhi High Court has rejected a suit for trademark infringement, without a trial, on the ground that it fails to disclose an adequate cause of action, despite the fact that both trademarks involved were the same i.e. ‘Kamadhenu’, albeit for different goods. The Order can be accessed here.

The word ‘Kamadhenu’, a word derived from Sanskrit is used to describe the ‘mother of all cows’ in Hindu mythology. The Plaintiffs in this case, Kamdhenu Ispat Ltd. had registered the mark ‘KAMADHENU’ in seven classes related to steel and other diverse classes related to chemical and industry, cement and construction, paints and varnishes etc. The main business of the Plaintiffs was related to manufacture and market of steel bars and other cognate products. The Defendants on the other hand were using the mark ‘Kamadhenu’ as a trading name for its ‘pickles’ business. The defendants were able to produce documents establishing that they were using the disputed name far before the Plaintiffs even started their business.

The Plaintiffs sought to sue for dilution and trademark infringement on the grounds that they have a trademark registration for ‘Kamdhenu’ despite the fact that there was absolutely no similarity between their products with those of the defendants. Falling back on first principles Justice Bhat stated “Trademark law, does not imply formalistic or ritualistic application of abstract principles; its existence and rationale is to protect businesses built up to match certain standards. If a trader or manufacturer uses words that acquire some distinctiveness, he is undoubtedly entitled to protection, at least in respect of similar marks, in respect of the goods he deals in. However, merely because he acquires registration (of the mark) he does not become its exclusive owner.”

Justice Bhat further held that the standard of proof to establish reputation for the purposes of dilution was rather high and would require the plaintiff to conclusively establish that the reputation transcended the main business of the plaintiffs. In this case the plaintiff had at best managed to establish its reputation with respect to steel bars and not to any other class of goods. Moreover there was absolutely no possible manner in which a steel buyer would get confused by the use of the mark on a jar of pickle.

On the basis of the above arguments Justice Bhat dismissed the suits stating that “the plaintiff has not been able establish the case for either infringement by dilution or of the corporate name, by the defendant; the suit itself does not disclose any cause of action, for any of the reliefs claimed. The suit and pending applications are therefore rejected; in the circumstances, there shall be no order on costs.”

If it were any other judge the matter would have probably been sent for trial and decided after 5 years and a lot of costs. Justice Bhat, however is probably one of the rare judges who has the courage and foresight to throw out frivolous litigation when he sees it.

Madras High Court dismisses Dr. Wobben's appeal against the IPAB's Order

Thanks to Sumathi and the India Kanoon website, we finally have access to a Madras High Court Order which sheds more details on the ‘big-ticket’ Enercon patent litigation taking place before the Intellectual Property Appellate Board at Chennai. The value of the dispute should be in the neighbourhood of $1 billion dollars making it one of the highest valued patent disputes in the country, dwarfing even the pharmaceutical patents by a substantial margin. The Madras High Court order reveals that there are more than 18 revocation petitions before the IPAB, filed by Enercon India, against patents belonging to Dr. Aloy Wobbens, the founder of the German company Enercon GmBH. The Order of the Madras High Court also draws attention to an order of the Company Law Board, in the year 2007, which thankfully lists out the gory details of the genesis of the Enercon litigation.

A. The Genesis of the Enercon Litigation: Enercon GmBH, a German company is the third largest manufacturer of wind turbines in the world and is credited with several path-breaking innovations in the field of wind-turbines. According to the CLB Order, Enercon GmBH entered into an agreement with Mehra Group of Companies in 1994 to jointly incorporate a company by the name of Enercon India Pvt. Ltd. to carry out business in India. The Share Holder Agreement (SHA) entered into between both companies allotted 56% shareholding of Enercon India to Enercon GmBH, with the remaining 44% going to the Mehra Group. On the same day both parties entered into Technical Know-how Agreement (TKA) by which Enercon GmBH was to supply known-how etc. to Enercon India. The Order further states that the TKA after its expiry was replaced by an alleged Intellectual Property Licensing Agreement (IPLA) between both parties. While the Order does not state so, I’m guessing that the IPLA licensed several patents to the Indian company. The company seems to have been doing rather well with over Rs. 4,000 crores on its order books. The management structure of Enercon India, had a Chairperson nominated by Enercon GmBH and a Managing Director nominated by the Mehra Group. The first hint of the dispute can be traced to when Enercon GmBH filed a petition before the CLB in the year 2007 alleging that the Mehra Group, being in exclusive management of the company are guilty of systematic concealment of the state of affairs of the company, financial mismanagement, like indiscriminate borrowings, indiscriminate investments in subsidiaries and associate companies, manipulation of accounts etc., non-supply of required information to the petitioner, the non-payment of royalties etc. etc. Enercon GmBH therefore wanted the CLB to issue directions to the company on a number of issues, the most important being the transfer of the remaining 44% to Enercon GmBH. A crucial factor holding back Enercon GmBH was the fact that the Board of the company was controlled by the Mehra Group despite the fact that Enercon GmBH had a majority share-holding. In any case it appears that Enercon India, in a bid to up the ante, started filing revocation petitions against Dr. Wobben’s patents. Once the company was rid of the patents it would have no IPR rights to assert in India.

B. The Petition before the Madras High Court. The petition before the Madras High Court, was in fact an appeal against an Order of the IPAB, praying for the Madras High Court to issue a writ of certiorari to strike down the impugned order. The IPAB in its Order had dismissed a misc. petition filed by Dr. Aloy Wobbens seeking dismissal of all the revocation petitions filed by Enercon India Pvt. Ltd. on the grounds that the constituted attorney, Mr. Yogesh Mehra, who had signed the revocation petitions was not duly authorized by the Company to file the same. Instead of dismissing the petition, as prayed for by the petitioners, the IPAB sought to hear this issue along with the main revocation petitions and passed an Order to the same effect. (The Order of the IPAB is not available on the internet.) Dr. Wobbens sought to argue that the initial board resolution dated 27.04.2007 authorizing Mr. Mehra to authorize litigation on behalf of the company, was in itself void as a result of the earlier CLB Orders. The subsequent CLB Orders are not accessible on the internet and hence it is not possible to independently assess the content of the CLB’s order. As of 29th October, 2007 however the CLB had not passed any observation stating that the Board Resolution was void.

C. The Madras High Court Order: The Madras High Court dismissed Dr. Wobben’s petition on the grounds that the Supreme Court case law suggested that when there were multiple appealable issues before a Court, all of them must be decided while the suit is being disposed and that the suit cannot be dismissed on the basis of only one issue. Since there were factual issues at disputes the Madras High Court dismissed the petition against the IPAB’s order and instead agreed with the IPAB’s decision to hear the revocation petitions along with the misc. petitions challenging Mr. Mehra’s power to authorize revocations on behalf of Enercon India.

D. Conclusion: Under Order XIV of the CPC a suit can be dismissed on a preliminary issue only if it can be decided on the basis of the law and not any factual enquiry. The implication therefore being that if the preliminary issue involves a factual dispute, the same can be decided only after a factual inquiry, i.e. a trial, wherein all other issues are also decided by the Court. (The CPC is not applicable to the dispute at hand and I have no clue of the IPAB Rules on the point.) Therefore if the Madras High Court and the IPAB were of the opinion that the dispute required a factual inquiry they were completely justified in issuing the orders that they did. It is a different matter that it would be a colossal waste of time & money to have a full blow patent revocation trial to discover at the end of the day that the power of attorney is invalid.

Madrid System & Indian trademark owners - Part II

                                         
ESSENTIAL CONSIDERATIONS WHILE FRAMING THE TRADEMARK STRATEGY
 

• REAL AND EFFECTIVE PRESENCE

Madrid System requires both the applicant and assignee to have real and effective industrial or commercial establishment in the office of origin and countries intended to be designated. Hence, Indian trademark owners can take advantage of the System only if it shows real and effective industrial or commercial establishment in member states where protection is sought using the System. The creation of Intellectual Property Holding Companies (IPHC) can be considered in this regard. The creation of IPHC shall inter alia consider factors such as tax planning and administrative synergies. IPHC shall not be made a mere passive owner of IP as non-use of IP is a valid ground for revocation in some jurisdictions.

•  OFFICE OF ORIGIN

The status of office of origin shall be considered while choosing it as it determines the countries which can be designated under the System. If the office of origin is a party only to the Agreement, then the applicant can designate only countries which are parties to the Agreement. If the office of origin is a party only to the Protocol, then the applicant can designate only countries which are parties to the Protocol. If the office of origin belongs to both the Agreement and the Protocol, then the applicant can extend its international registration to all the contracting parties of the Madrid Union. Thus, if India is chosen as the office of origin, then the applicant can designate only countries which are parties to the Protocol. 

An international registration remains dependent on the mark registered or applied for in the office of origin for a period of five years from the date of its registration/application. If, and to the extent that, the basic registration ceases to have effect whether through cancellation following a decision of the office of origin or a court or voluntary cancellation or non-renewal within this five-year period, the international registration will no longer be protected.   Similarly, where the international registration was based on an application in the Office of origin, it will be cancelled if, and to the extent that, the application is refused or withdrawn within the five-year period, or if, and to the extent that, the registration resulting from that application ceases to have effect within that period.  This is often referred to as “central attack”. After the expiry of five years, the international registration attains a status independent of the basic registration or basic application.  

The cancellation or limitation of application/registration under the Protocol does not necessarily cost the trademark owner its rights and priority. The Protocol incorporates a mechanism called “transformation” which in a way mitigates the effects of “central attack”. As per this mechanism, extensions applications/registrations can be transformed into new non-Protocol applications in designated countries within three months from the invalidation or cancellation of the home application or registration. These new non-Protocol applications are permitted to retain filing and priority dates of the invalidated and cancelled home application.  This mechanism does not exist under the Agreement.

In the light of the above mechanism, when a trademark owner anticipates strong opposition to his trademark, it is not advisable to file in an office of origin which is a party only to the Agreement and maintains a high threshold criterion for granting protection. Thus, the status of office of origin is a pertinent factor in the evaluation of threshold for granting protection in an office of origin.

•  DESIGNATING MEMBER STATES

The Madrid System shall be chosen only if it is beneficial over filing at national and regional trademark offices. It may be noted that the benefits of the System cannot be realised if the mark encounters strong objections in designated countries. If a mark is challenged, the applicant must designate a local representative and pay representation fees.

•  CLASSIFICATION OF GOODS AND SERVICES

The Madrid applications are required to identify the classes of goods and services for which registration is sought. The goods and services must be set forth in precise terms, preferably according to the classification established by ‘International Classification of Goods and Services for the Purposes of the Registration of Marks under the Nice Agreement’.

The classification of goods and services by the office of origin defines the extent of the rights of the trademark owner in other countries. If the office of origin permits broad classification of goods and services for national applications and registrations, then the scope of protection that an applicant can obtain in other member states under the System will also be broad. However, this is subject to the domestic laws of those countries. The converse is also true. For instance, United States does not allow broad classification of goods and services.

•    TRADEMARK SEARCH AND CLEARANCE PROCEDURES

Considering the rise in trademark applications with the adoption of Madrid System, the potential for conflict will be more. It may result in rise in risk of filing of third-party applications in the interim. As the national databases may not be up-to-date, search must not be confined to them. If filing in such a country is intended either for using it as an office of origin or for designating it in the international registration, then it is safer to expand the search parameters to include WIPO's free online trademark databases – Madrid Express and Romarin databases. Even if an applicant intends to register his mark in a member country of Madrid System but does not intend to use the System, it is still advisable to search the above mentioned databases to confirm that no party has designated this member country for protecting the same mark. This will, nevertheless, result in lesser uncertainty while adopting a mark.

Madrid System & Indian trademark owners - Part I

                                

The Trademarks (Amendment) Bill 2009, which aims at bringing Madrid Protocol into force, has been passed by both Lok Sabha and Rajya Sabha. For more see here. However, India is yet to become a member of Madrid Protocol. [For the list of  members as on September 17, 2010, see here.] In the light of passage of Bill by both the houses of Parliament and Cabinel approval to accede to the Protocol, India's entry into the Madrid Protocol is imminent. In the light of this development, I intend to discuss some essential considerations which shall form part of any trademark strategy which involves Madrid System.  I shall discuss them in two parts. In the first post, the  procedural framework as prescribed by the Madrid System shall be discussed. In the second post, some essential considerations qua usage of Madrid System shall be discussed.

REGISTRATION OF TRADEMARK IN A FOREIGN JURISDICTION

A trademark can be protected by registration in a foreign jurisdiction in three ways:
•    registration at national trademark office
•    registration at regional trademark office if the foreign country is part of that regional set up
•    international registration of trademark

The registrations of a mark at national and regional trademark offices are acceptable options in case of management of a limited trademark portfolio. However, it may not be the case when the contours of a portfolio are broader than that of national and regional registrations. Such registrations may create difficulties for trademark owners in both administration and management of the portfolio. This calls for the usage of Madrid System which provides for international registration of marks i.e protection of marks in several countries by filing one single international application. The System is governed by two treaties: the ‘Madrid Agreement Concerning International Registration of Marks’ (hereinafter Agreement) which dates to 1891 and the ‘Protocol Relating to the Madrid Agreement Concerning International Registration of Marks’ (hereinafter Protocol) which came into force in 1996. 

The Madrid System for the international registration of trademarks, administered by the International Bureau of World Intellectual Property Organization (hereinafter WIPO), provides one single procedure for the registration of a mark in several territories. Any State which is a party to the ‘Paris Convention for the Protection of Industrial Property’ can become a party to the Agreement or the Protocol or both. The Madrid Agreement is the oldest multilateral regime to simplify and harmonize the standards and procedures for trademark registration and protection. The Madrid Protocol which was adopted in 1989 introduced certain new provisions into the system of the international registration of marks. It was aimed at removing difficulties which prevented certain countries from adhering to the Madrid Agreement.

MAIN DIFFERENCES BETWEEN MADRID PROTOCOL & MADRID AGREEMENT – AN OVERVIEW

As compared with the Madrid Agreement, the Protocol introduces the following provisions:

- international registrations can be based upon national applications as well as national registrations;  under the Agreement, an international application can be based only upon a registration in the Office of origin; 

- each contracting party in which the applicant seeks protection may elect for a period of eighteen months (instead of one year) or an even longer period in the case of opposition within which to declare whether protection can be granted to the mark in its territory;  under the Agreement, this period is limited to one year; 

- Office of each contracting party may receive higher fees than under the Agreement;

- an international registration which is cancelled at the request of the office of origin (“central attack provision”), for instance owing to the refusal of the basic application or cancellation of registration within five years from the date of the international registration, may be transformed into national (or regional) applications in the respective contracting parties in which the international registration had effect, each benefiting from the date of the international registration and where applicable, its priority date (“transformation provision”);  this mechanism does not exist under the Madrid Agreement.

APPLICATION FOR INTERNATIONAL REGISTRATION

An application for international registration must be presented to the International Bureau through the office of origin.  The application may designate one or more contracting parties in which the mark is to be protected. Subsequently, more contracting parties may be designated.

WIPO, upon receipt of Madrid application, enters the information in its database and determines whether the applicable Madrid filing requirements are met. If the application does not conform to the established requirements, WIPO, depending on the nature of the deficiency, will contact either the trademark owner or office of origin.

When WIPO confirms that the necessary Madrid requirements have been met, it registers the mark and publishes it in the WIPO Gazette of International Marks. The International Bureau notifies each contracting party in which protection has been requested. The request for protection of the mark in each of the designated contracting parties is treated as if the mark has been deposited directly with the office of that contracting party from the date of the international registration or subsequent designation.  Each designated contracting party has the right to refuse protection within the time limits specified in the Agreement or Protocol. If the refusal is not notified to the International Bureau within the applicable time limit, then the request for protection of the mark in the designated contracting party is taken as granted.  In contrast to the Agreement which establishes a strict twelve-month period for notifying WIPO of a refusal,  the Protocol allows a national office of up to eighteen months to consider a request for national extension if a declaration is made to that effect . This period of time may be extended in countries having an opposition system if, within the initial eighteen-month period, the office notifies WIPO of the possibility of a refusal based on an opposition.  As the request for extension is processed, the national office may require the applicant to provide additional information or to respond to office actions. The applicant, at this point of time, will most likely need to appoint a local trademark attorney for such communication with the national office.  

The protection in designated countries ceases to exist with the expiry of the Madrid registration. The Madrid registration is valid for twenty years under the Agreement  and ten years under the Protocol . The renewal which is also for a term of twenty years under the Agreement  and ten years under the Protocol  is accomplished through a single filing with WIPO.  It may be noted that both the Agreement and Protocol are silent on the number of renewals of a mark. The Madrid System does not permit an owner to amend the mark for obtaining protection in a member country. In contrast, national filings may allow the applicant to amend the mark for avoiding conflicts.

Updates : Asked not to dial- Just Dial accuses Askme of Data Theft

Earlier this year, I had reported the legal tussle between Just Dial and Infomedia 18 Limited. Just Dial had accused Infomedia 18 of copyright infringement with respect to the valuable database which has been a result of the extensive research carried out for 14 years,as Infomedia 18 had substantially copied its database and was displaying the same on its website askme.in. The Delhi High Court recognizing the significance and seriousness of the breach allowed an ex parte injunction and restrained Infomedia 18 from running the website till the next date of hearing. Justice Indermeet Kaur noted that in case the order was not passed, Just Dial would face "irreparable loss". In addition to this, the Court also appointed two officials, in Delhi and Mumbai , respectively, to take in to custody the computer hardware and any other storage media which has been used by askme.in to store any data developed by Just Dial. The matter was next listed on March 25,2010.

Mumbai Mirror reports that Just Dial has now filed a petition in the Bombay High Court to direct the Borivali Metropolitan Magistrate to pass orders under Section 156 (3) of CrPC, which provides for registration of FIR and investigation against the accused. Just Dial’s grievance is that the Magistrate instead has passed an order under Section 200, which provides for inquiry by Magistrate himself, whereas Just Dial seeks registration of an FIR with the Cyber Crime Cell.

Just Dial's plea before the High Court was that given the magnanimity of the crime, it was not possible for Just Dial to collect evidences on its own and therefore the case should be handed over to the Cyber Cell. Just Dial further pleaded that the Cyber Cell refused to intervene in the matter as the civil suit was pending before the High Court.However, Just Dial avers that pursuing civil remedies is no bar to pursue criminal remedies available.

As Mumbai Mirror further reports:

The petition discloses information about civil suits pending before the Delhi HC, saying Just Dial filed a suit in January seeking damages and restraining Infomedia from using the ‘stolen’ database. On January 29, a single judge passed an order in favour of Just Dial. The Court also appointed Court Commissioners to raid Infomedia’s Delhi and Mumbai premises.According to the petition, during such a raid in Mumbai the local court commissioner found ‘infringing entries’ at Dhirubhai Ambani Knowledge City, and the server was seized.

Infomedia challenged this order in February, and a Division Bench directed CFSL to make a mirror copy of Infomedia’s disk and submit it to the HC. The Bench also asked Infomedia to redevelop its entire database after deleting infringing entries.On March 26, Infomedia filed a counter case against Just Dial alleging theft of its database. Infomedia also sought appointment of a local commissioner, which was granted, but later set aside by a Division Bench on Just Dial’s appeal in May. All these cases are pending before the Delhi High Court. During the hearing on the case at the Bombay HC on October 15, the State stuck to its stand of not interfering in the matter because of pending cases at Delhi.

Justice VM Kanade, however, asked the assistant government pleader to seek instructions from Home Department and adjourned the matter to October 22.