Image from here

In Part-I, I briefly introduced NFTs, how they operate and why they are being hailed by content creators in the digital space. I had postulated that the NFT sale may just be the sale of the original/authentic copy of the work, or attached with a copyright license, or even an assignment, depending on the contractual terms. I had surmised that it would most likely not have any copyright license or assignment, based on a few contracts I could locate online. I had made to underlying assumptions in Part-I:

1. There is copyright subsisting in the underlying work/digital asset.
2. The owner of the copyright has created the NFT

What if these assumptions are misplaced?

First assumption

If the first assumption is incorrect, I do not see a significant problem. If there is no copyright subsisting in the item, the question of copyright license or assignment is moot. Suppose the seller represents otherwise, and the purchaser procures based on said representation. In that case, there may be contractual remedies available.

Second assumption

If the second assumption is incorrect, it raises additional questions, but there are answers. The NFT minter could have misrepresented himself to be the creator/author of the underlying work. Or the NFT could be associated with an infringing work. Or the NFT minter may have created a derivative work without taking a license. The possibilities are many, and there could be a massive rip-off in such transactions. A simple internet search reveals several such stories and news items. Here is one interesting ‘social experiment’ that Swaraj brought to my attention.

From a pure copyright angle, the original author/owner may seek legal remedies for infringement. Whether such NFT minting and onward sale amount to infringement must be assessed under the known principles of copyright law – is there a reproduction/communication of work to the public without the consent of the copyright owner; is it a substantial copy; and if it is exempt under any exception (probably not). On first principles, it appears to be an infringement, but I will move on. It may not be possible for the NFT marketplaces or platform to verify the authenticity or provenance of the claims being made by the NFT creator. I noticed in Rarible® that it has a relatively simple “verification” exercise, accounting for the person’s social media profile and perhaps other proxies for credibility/reputation. Undoubtedly, this not foolproof.

Most also have a takedown notice system. For instance, this is from OpenSea:

“OpenSea reserves the right to remove content without prior notice. OpenSea will take down works in response to formal infringement claims and will terminate a user’s access to the Services if the user is determined to be a repeat infringer.”

I did not verify this for each NFT marketplace, but I presume most would be sensible to have such a system. To the extent the services are available in India, Section 79 of the IT Act, 2000 and the intermediary guidelines thereunder would come into play, irrespective of the choice-of-law clauses. The statutory remedies under Indian law would be available. The special provision on jurisdiction under Section 62 of the Copyright Act, 1957 would also extend to Indian authors whose rights are being violated through the platform. These are just old issues but for a newer platform. Yes, as with most digital platforms, the scope for infringement is much more significant, and practical problems may arise. For creators/owners to constantly stay vigilant and police the incredible amount of NFT floating around is nearly impossible. As things progress, there may be a call for heightened measures being imposed on such platforms. In fact, there has already been a call for heightened measures on interemediaries.

There may also be contractual remedies from the perspective of the NFT buyer and/or even the auction house/platform. If, for instance, the NFT contract of sale contained terms of copyright license or assignment, but the NFT minter has no rights to the work, the contract would be hit by the well-known doctrine of nemo dat quod non habet. After all, there is no central register/repository to mandatorily register copyright or assignment agreements to verify copyright ownership claims, and so, innocent purchasers could be protected. I would also bet that the contract associated with the NFT sale would have explicit representations of ownership/authenticity in the underlying work. This is the case with the terms and conditions at Christie’s.  If so, the traditional principles of fraud/misrepresentation under the applicable contract law would kick in. Whether these representations were false and if such falsity could not have been discovered by due diligence. Depending on the outcome of the analysis and the choice-of-law in the auction contract, the purchaser may have the option of voiding the transaction. Enforcing these remedies? That is an entirely different ball game.

Value proposition?

I think the bigger (possibly non-legal) issue is the value proposition involved with such transactions. Even if the NFT sale contract transferred copyright ownership over or provided a license to the underlying work, this would not necessarily prevent parties from reproducing it. For instance, the work may have been initially released under attribution-only open source licenses like CC BY 4.0, and the new owner may have little choice for circulating copies. Similarly, suppose there is not even a copyright license associated with the NFT sale. In that case, the purchaser may not commercially use the underlying art to sell other products.

The NFT purchase, depending on the NFT contract, simply identifies a specific person as owning the authentic original work, much like how collectors/museums proclaim to possess ‘original’ masterpieces. This value proposition would be meaningless without proper due diligence over the NFT minter and the work’s provenance. Undertaking this exercise itself would be a great business solution, I recoken.

AI as an author?

What if one of the authors was a non-human creator/co-creator (see here)? The following relevant extract from Section 2(d) of the Indian Copyright Act, 1957 is relevant:

“author” means, –

…

(vi) in relation to any literary, dramatic, musical or artistic work which is computer-generated, the person who causes the work to be created;

I think this begs the question because one may need to have a better understanding of what is “computer-generated”. The above-extracted provision connects the word “computer-generated” with the phrase “the person who causes the work to be created”. This immediate context suggests that for computer-generated work, one is dealing with a cause-and-effect relationship – a ‘person’ is causing the work to be generated on a computer. This accommodates what is commonplace today – using software to render the work as conceived by the natural person/individual. What about AIs? Suppose the AI conceives of the work and renders it on computer media. In that case, this underlying cause-and-effect relationship between a natural person and a computer does not exist anymore.

Can an AI be the “person” who is creating the “computer-generated” work? The term “person” is not separately defined in the Copyright Act, 1957. Whether, in the ordinary and/or legal sense, the term “person” would include an AI is the bone of contention that has been debated in the annals of Science Fiction (I still vividly recollect the episode of Captain Picard fighting for Data’s rights; or for that matter, Asimov’s Positronic Man and Bicentennial Man) for several decades and has recently been debated several times over the context of intellectual property (remember the monkey case?). In my opinion, the concept of the “person” in jurisprudence typically involves recognition of being capable of holding rights and duties. For instance, it is on this basis that legal entities such as companies have been considered “persons” for more than a century.

It cannot be that an AI can be regarded as a “person” for the purposes of one or two isolated legislations (such as intellectual property legislation) but not in others, except, of course, such a deeming fiction may be created by law by way of amendment. But in the general legal sense, where no such deeming fiction is created by law, it may be difficult to recognise an AI as a person unless the AI is recognised as a “person” for all legal purposes. The EPO has already considered that AIs do not have legal personality, and barring an amendment, an AI cannot be included as an inventor (here and here). They must be capable of having the right to acquire assets, open bank accounts, do other things, and be liable to duties and obligations such as, for example, being subject to criminal law for offences. I do not believe that the situation is evolved to that extent today to consider AIs as capable of holding all sorts of rights and obligations/duties.

Topical Highlight

Intellectual Property Rights in Covaxin – Part 2 (IP Ownership in Publicly Funded Research)

In Part II of this post, Anupriya and Swaraj analyse the broader issue of IP ownership in outcomes of publicly funded research. They note that the government’s retention of IPR in Covaxin and the novel mRNA vaccine in the pipeline, would enable it to be in a position to share them with the rest of the developing world. They examine the patchwork of rules, regulations and guidelines governing this issue, and argue that instead of leading to certitude and consistency, these scattered (and sometimes mutually inconsistent) policies have exacerbated the lack of clarity on this issue. They note the welcome shift heralded by the draft 5th Science, Technology and Innovation Policy in its attempts regarding regulation of IP in the innovation ecosystem. However, they also caution that the policy has been criticized for paying mere lip-service to the laudable goals of innovation and access without providing any effective guidance on how these goals will be realized, especially given the assumptions on state-center coordination. They conclude that the government’s lack of control over IP rights in Covaxin have cost India the opportunity to provide relief to several poorer countries in the world. 

Intellectual Property Rights in Covaxin – Part 3 (IP Rights over Clinical Drug Trials (CT) Data)

In part III of this post, Anupriya analyses the refusal of the government to share clinical trial (CT) data of Covaxin, which was granted approval in ‘clinical trial mode’ without phase 3 efficacy data and was approved for regular emergency use authorization only on March 11, 2021. She examines the nature and extent of protection over CT data in India as well as India’s TRIPS obligations in this regard. She notes that both Sections 8(1)(d) and 8(1)(e) of the RTI Act, cited to exempt the information from disclosure via RTIs, can be overridden due to larger public interest involved as per the text of these Sections itself. She argues that not many concerns come to mind which would be as compellingly within the ambit of public health and interest as vaccination amidst a deadly pandemic in a densely populated country with abject inequalities in access to medical infrastructure as India. She concludes that such disclosure would also not violate Article 39(3) of the TRIPS.

Copyright Rules Amendment 2021: Appellate Board, Copyright Societies, and More

In this post, Nikhil analyses the Central Government’s recent notification of the Copyright (Amendment) Rules, 2021. The amendments replace ‘Copyright Board’ in the rules with ‘Appellate Board’ similar to the draft, which Nikhil notes is a redundant exercise given the plan to scrap the Appellate Board soon. He highlights that the introduction of a mandatory annual transparency report to be published by Copyright Societies is the most significant addition which will help in resolving information asymmetries that have plagued the functioning of copyright societies generally where authors have not received their due share of royalties. He also notes that not including the draft’s proposal of a proportionate voting mechanism in accordance with the number of works or royalties received by a member, or their duration of membership in the final amendments is a welcome change. This is because it would have adversely impacted the smaller players in societies. Analysing a few other amendments and omissions, he concludes that a holistic, transparent and inclusive review of the rules is required.

Thematic Highlight

Bombay HC Rejects Mandatory Copyright Registration: Is it time to Reconsider Automatic Protection?

In this post, Adyasha discusses a recent Bombay High Court judgment in Sanjay Soya v. Narayani Trading which overruled an erroneous 2012 precedent laid down in the case of Dhiraj Dewani v. Sonal Infosystems. The Bombay High Court held in the recent decision that registration of copyright is not mandatory for obtaining relief in an infringement action. Adyasha examines the feasibility of an automatic copyright protection policy in light of present-day realities. She notes that coupled with the relatively low threshold of originality, automatic protection allows works to be easily locked up outside the public domain. She argues that this problem is particularly amplified in case of orphaned works, where the lack of traceability of owners and fear of litigation impedes their use. However, she also highlights that practically, in India and in other developing countries and LDCs where a vast majority of authors operate under social, financial, digital and informational limitations, mandatory registration would significantly impede them from protecting their rights. She concludes that while registration and maintenance of databases offers significant benefits, a wholly mandatory registration system is unsuitable for present Indian realities.

Other Posts

European Decision on Patentability of Simulations and Implications for India

In this guest post, Rajiv Choudhry discusses a recent decision by the Enlarged Board of Appeals at the European Patent Office on patentability of simulations and its implications for Indian patent law. He notes that a Google search for “simulation” brings up the definition of simulation as “the production of a computer model of something, especially for the purpose of study.”  He highlights that the European patent application 03793825.5, which provides a computer-implemented simulation of movement of a pedestrian crowd through an environment such as a building, was refused by the examiner on the ground that the invention lacked an inventive step, mainly because simulation was considered not to contribute to the technical character of the invention. He noted the Board of Appeals’ decision in this regard which reasoned that for the assessment whether a simulation contributes to the technical character of the claimed invention, it is not decisive whether a technical or a non-technical system or process is simulated. He concluded that given the almost similar wording of Section 3(k) of India’s Patents Act to that of Article 52(2)(c) of EPC, inventions/claims relating to simulation should be patentable in India as per the reasoning provided by the Board.

Why the Case of Hero Electric vs. Lectro E-Mobility Actually Demystifies the Arbitrability of IP Disputes

In this guest post, Ishika Ray Chaudhuri and Ajeeth Srinivas K. respond to Lokesh Vyas’ recent post that looked into the case of Hero Electrics v. Lectro E-Mobility, wherein the order, holding the dispute to be arbitrable, was critiqued for inadequately clarifying the difference between IP disputes that can be arbitrated versus those that cannot. They disagree with Lokesh’s critique and argue that this order in fact furthers the position of arbitrability of IPR disputes in India. They note that the Court’s decision was in line with the four-fold test laid down in Vidya Drolia v Durga Trading Corporation, as per which the Court is only allowed to adjudicate to the extent of the specific tests mentioned therein, which are the qualifiers to adjudicate prima facie arbitrability. They note that all other questions of arbitrability of the dispute must be left to the tribunal to adjudicate upon, without the intrusion of the Court, for if the Court indulged anything further, the same would be usurping the powers of the tribunal. Thus, they argue that this case does not hinge on the arbitrability of the subject-matter – i.e., say, an infringement on the trademark in question but on the arbitrability of the claim. They also highlight that rights in rem do not give rise to rights in personam, but rather the opposite, if at all. Therefore, given that rights in personam are arbitrable under Section 8 of the Arbitration and Conciliation Act, 1996, the case in question in fact clarifies and upholds the Indian perspective on the arbitrability of IPR, instead of mystifying it further as the impugned post claims. They conclude that the case clearly demarcates the right of an arbitral tribunal to rule on its own jurisdiction, only leaving tertiary cases to the Court.

Decisions from Indian Courts

• The Delhi High Court in Britannia Industries v. Parle Biscuits in a suit alleging disparagement of goodwill and reputation of the plaintiff’s cookies by the Defendant in one of their advertisements uploaded on YouTube noted the agreement of the defendants regarding changing the colour of the packet and design of the cookies in the advertisement in question. [March 26, 2021]
• The Delhi High Court in Star India Ltd. v. Y1.Mylivecricket.Biz adjudicated upon the plaintiffs’ exclusive rights to broadcast the fourteenth season of the IPL conducted by the BCCI on television, internet and mobile applications, under agreement dated 7th September, 2017, executed with the BCCI. The Court granted an ad interim injunction restraining defendants 1 to 13 from, in any manner, posting, streamlining, reproducing, distributing, making available to the public and/or communicating to the public, the fourteenth season of the IPL. [March 26, 2021]
• The Delhi High Court in Alkem Laboratories v. Tyscon Pharmaceuticals granted an ad interim injunction in favour of the plaintiff restraining the defendants from using the impugned marks ‘TYXIM, TYXIM FORTE and TYXIM marks’ in relation to any pharmaceutical and/or medicinal preparation. [25 March, 2021]
• The Bombay High Court in Hindustan Unilever Ltd. v. an opposing Party held that setting out two separate prayers in the same plea – one against trademark infringement and another against passing off constitutes an incorrect and unwise practice. [22 March, 2021]

Other News

• T-Series and The Indian Performing Right Society Limited (“IPRS”) announced that Super Cassettes Industries Limited has joined as a member of the IPRS.
• Fiji PM Frank Bainimarama expressed gratitude to India for providing 1 lakh doses of COVID vaccines.
• India’s drug regulator reportedly allowed the AstraZeneca Covid-19 vaccine to be used for up to nine months from its manufacture date, as opposed to the prescribed six months in order to minimise vaccine wastage.
• In order to boost the spread of information in South Africa’s 11 official languages, Wikimedia South Africa, partnered with the Moleskine Foundation to hold “edit workshops” to teach people how to properly edit Wikipedia entries around various themes. Learning about copyright law is an integral part of the process since uploading certain content such as photos could be considered copyright infringement.
• Activision issued a DMCA takedown notice to the Twitter account of website Video Games Chronicle after it covered map leaks from Call of Duty: Warzone.
• An article in the Financial Express examined inequities in access to vaccines and stressed the need to carefully examine tools like ‘patent pause’ to ensure access to Covid-19 vaccines for poorer nations.
• A court granted a temporary restraining order in favour of Nike against MSCHF, the retail startup that made Lil Nas X’s “Satan Shoe” in a case alleging trademark infringement and tarnishing of reputation.
• US District Judge Ronnie Abrams rejected Ed Sheeran’s bid to dismiss one out of the three lawsuits against him, alleging that he plagiarised a Marvin Gaye song for his hit Thinking Out Loud.

image from here

IPAB has been in the eye of the storm since its inception. While there are ardent believers of the institution (See here and here), there are equally strong arguments by the ones against it (few of them advanced by the former Chairperson of the institution itself!) (See here here and here). A few months ago, the Executive seemingly laid the debate to rest by introducing the Tribunal Reforms (Rationalisation and Conditions of Service) Bill 2021, proposing to scrap IPAB. However, the bill was not passed in the session it was introduced and is now seemingly pushed to the next session for fruition. In a recent development surrounding this event, the President, apparently being satisfied that circumstances exist which render it necessary for him to take immediate action, on 04/04/21 promulgated the Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance 2021 (pdf) using the powers under Article 123 (1) of the Constitution. 

While a detailed post on the assessment of the ordinance shall follow soon, it is pertinent to note that the ordinance has effectively scrapped the IPAB and have transferred the powers and duties of the Board to the High Courts, under Chapter V (for patents) Chapter VII (for Trademarks) Chapter VIII (for GI) Chapter IX (for Plant Varieties) and to Commercial Courts under Chapter III (for Copyright). 

But what about the matters pending before the IPAB? The ordinance under clause 15 makes available the remedy in form of the Transitional Provisions. It states that- 

15. (1) Notwithstanding anything contained in any law for the time being in force, any person appointed as the Chairperson or Chairman or President or Presiding Officer or Vice-Chairperson or Vice-Chairman or Vice- President or Member of the Tribunal, Appellate Tribunal, or, as the case may be, other Authorities specified in the Schedule and holding office as such immediately before the notified date, shall, on and from the notified date, cease to hold such office, and he shall be entitled to claim compensation not exceeding three months’ pay and allowances for the premature termination of term of his office or of any contract of service.

(2) The officers and other employees of the Tribunals, Appellate Tribunals and other Authorities specified in the Schedule appointed on deputation, before the notified date, shall, on and from the notified date, stand reverted to their parent cadre, Ministry or Department.

(3) Any appeal, application or proceeding pending before the Tribunal, Appellate Tribunal or other Authorities specified in the Schedule, other than those pending before the Authority for Advance Rulings under the Income-tax Act, 1961, before the notified date, shall stand transferred to the Court before which it would have been filed had this Ordinance been in force on the date of filing of such appeal or application or initiation of the proceeding, and the Court may proceed to deal with such cases from the stage at which it stood before such transfer, or from any earlier stage, or de novo, as the Court may deem fit. 

(4) The balance of all monies received by, or advanced to, the Tribunal, Appellate Tribunal or other Authorities specified in the Schedule and not spent by it before the notified date, shall, on and from the notified date, stand transferred to the Central Government.

(5) All property of whatever kind owned by, or vested in, the Tribunal, Appellate Tribunal or other Authorities specified in the Schedule before the notified date, shall stand transferred to, on and from the notified date, and shall vest in the Central Government.

Huge thanks to the anonymous readers of the Blog for immediately sharing a copy of the Ordinance with us so we could write on it. 

edit: edit: Interesting observation- does it mean this ordinance overrules the newly announced Copyright Rules? The ordinance doesn’t expressly refer to the new Rules at all. See Nikhil’s question on this raised here.

“Kidney health patented” seems like one of the USPs. Image from here

Recently Madras High Court added another tale in the litigation scrimmage between US corporate Kibow Biotech and Indian entities La Renon Healthcare Pvt. Ltd. and Stanford Labs Pvt. Ltd. (not to be confused with the American university) by “making absolute” a previously granted interim injunction against the Indian entities, via its order dated 01/04/2021 (pdf). 

Back in 2013 we had reported about a rare occurrence in Indian IP litigation where the IPAB’s order against the revocation of a patent was validated by the High Court. Emanating from the same chain of events, Kibow Biotech (Patentee/ Respondent in those proceedings) instituted a suit against La Renon Healthcare Pvt. Ltd. and Stanford Labs Pvt. Ltd. (the applicant seeking the revocation then), for infringement of its patents, via its exclusive licensee Centaur Pharmaceuticals Pvt. Ltd.  In course of the proceedings, initially an interim injunction was granted for 14 days and was later modified permitting the Respondents to sell the stock in hand. However, that order was kept in abeyance and by this order the Court reinforced the interim injunction presumably without the additional conditions attached thereby “making absolute” the injunction.

Brief Background

On 28/03/2006, Kibow Biotech applied for registration of its invention “Compositions For Augmenting Kidney Function”. It was specified as “an invention which augments kidney function using a probiotic Streptococcus Thermophilus (the probiotic) so that build up of toxins and metabolic wastes, and overgrowth of undesirable bacteria is reduced in the kidney.” (pdf of the specification). It’s application was based on the priority date 18/03/2004 and was granted patent protection on 29/09/2008 bearing no. 224100. This patent protection was challenged by La Renon by instituting a revocation proceeding before the IPAB under the grounds mentioned in Section 64 (1) (d), (e), (f), (h), (i), (j), (k) and (q). The Board rejected the revocation petition and the rejection was subsequently upheld by the Madras High Court as well. 

Cut to 2019, Kibow Biotech and its exclusive licensee Centaur Pharmaceuticals (Applicants) filed a suit against La Renon Healthcare and its manufacturer Stanford Labs (Respondents) seeking permanent injunction, direction to take accounts of the Respondents with regard to alleged infringing use, consequential relief of seizure and forfeiture and destruction of the Respondents’ products and for damages of INR 1,00,00,000. The Applicants alleged that the Respondents via their products “Cudo” “Cudo Forte and/or Probigress” are infringing its patent by using the same strain of the probiotic, which is administered in similar fashion and results in similar effects as their patented product (sold under the name Renadyil). The patentee also sought an ex-parte interim injunction by the Court, which was granted via order dated 29/11/2019, for a period of 14 days i.e. till 13/12/19. The Respondent subsequently sought vacation of this ex-parte order, however, the Patentee alleged that Respondent continued to sell its product in this period, and produced bills of sale as evidence. Owing to this, the Respondents filed an application for contempt of the Court’s ex-parte order. By a chain of subsequent orders, the Court permitted the Respondents to sell off the stock in hand (for Cudo Forte and/or Probigress) and also directed for keeping the ex-parte interim order in abeyance till a clarification by the Division Bench on a specific order. . Finally, the Division Bench asked the single bench to combine these applications and hear them together, in furtherance of which the present order was passed. 

Assessment

Thankfully, the single bench avoided holding a “mini trial” in the interlocutory stage and instead directed the parties to relegate arguments on validity, infringement and application of infringement back to the trial court. However, while holding that the Applicants are able to establish a prima facie case for the interim protection, the Court made some problematic observations on patentability of subject matter.

Section 3(e) of the Patent Act, states that a substance which has been obtained by a mere admixture resulting in aggregation of its properties is not an invention. Thus, as explained by Adyasha here, to avoid attracting Section 3(e), a claim must show that the interaction between the components involved in the invention achieves a combined effect which is different from the sum total of the effects of the individual substances. 

In the present case, the patented subject matter is claimed to be a “composition for augmenting kidney function in a subject comprising at least one probiotic bacterium wherein said probiotic bacterium selected from streptococcus thermophiles at about 5 billion to about 20 billion colony forming units of said at least one probiotic bacterium other ingredient being selected from vitamin, mineral, carbohydrate, protein and fats.” (Claim no.1 ) The remaining claims of the invention includes other components (like fats, minerals, carbohydrates in the invention), but the function which the invention seeks to perform is performed by the probiotic as specified in Claim no. 1.  However, the Court opined that the Applicant’s efforts in identifying the probiotic among plethora of other bacterium and determining the required quantity for forming the colony requires research; and to identify this probiotic, numerous others would have been tested and rejected. The Court therefore observed that the present invention cannot be regarded as a mere admixture or a “discovery made overnight.”

How do the earlier statements lead to that conclusion? Given that ‘a mere admixture’ of the given statements certainly don’t lead to it – it would’ve been useful for the Court to explain how the ‘combined effect’ was greater than the sum of its parts! (thanks Swaraj for this line) While it was right in not making an in depth assessment of the patentability of the subject matter and left it to be determined during the trial, I feel that it should have completely avoided summarily discussing applicability of Section 3(e) in the present case. The Court on numerous points stressed upon the need of evidence and pleadings to substantiate complicated matters surrounding patentability (see para (s) 58, 63, 64, 69) however, by making the above observation in the order the Court somewhat impresses the validity of the patent, something which by its own admission is to be decided in the  trial up ahead. 

Furthermore, the Court’s reasoning for dismissing the Respondent’s arguments on the patented subject matter being an admixture is based on the revocation ruling of the IPAB and the Court subsequent order in the Writ petition. However, these two orders have their own set of limitations with regard to determining whether the invention is a mere admixture or not. The IPAB revocation ruling for instance isn’t clear on how the product is not a mere admixture since the “augmenting kidney function” as claimed in Claim number 1 is performed by the probiotic alone whereas compositions Claim 5 onwards assist as mere supplements. The Board hasn’t exactly justified its reasoning on holding that the primary function of the invention i.e. augmenting kidney function is performed by the combined effects of the components of the invention and much of this lack of reasoning can be attributed to the relative absence of substantive pleadings by the Applicant there. Similarly, as pointed out by Pankhuri here, with regard to the order concerning the writ petition, the Court held itself back on adjudicating upon the merits of the IPAB order and rather focused on its “supervisory jurisdiction” under Article 226, thereby taking IPAB’s word on the issue. Thus, on one hand the Court rightly left substantial issues for the trial but on the other hand made a quick assessment of the above said complicated issues anyways. Such an assessment should have been avoided, during the interlocutory hearings (as argued by Prof. Basheer, Jay and Prakruti in their paper here) largely owing to the complexity of the matters and the lack of understanding of our Courts in understanding the technical jargon. Therefore, it would have been better had the Court reserved itself from getting into these intricacies and left adjudication on patentability of the subject matter for the trial. 

image from here

On 5th April, the Supreme Court of the United States allowed Google’s appeal and held that Google’s copying of roughly 11,500 lines of code relating to 37 software packages forming part of Sun Java Application Programming Interface (API), owned by Oracle, was protected by ‘fair use’. The majority opinion was delivered by Justice Breyer (joined by 5 other judges), and a dissenting opinion was filed by Justice Thomas (joined by one other judge). One judge (Justice Barrett took no part in the decision).

In this Part I, I will limit myself to introducing the case and summarising the majority view.

Background

In a suit for copyright infringement concerning the aforesaid copying of API, the District Court originally held that the subject matter was not copyrightable. Although there were also claims for patent infringement, this was dropped later. On appeal in 2014, the Federal Circuit reversed and held that there was copyrightable subject matter but remanded the matter back to the District Court for a finding on whether the ‘fair use’ immunity applied in favour of Google. The SCOTUS refused certiorari at that point. In a jury verdict on remand, Google succeeded on the ‘fair use’ defence. The matter was appealed to the Federal Circuit a second time by Oracle, which reversed the jury verdict as a matter of law and held that “fair use” was not established by Google in the present matter.

In the 2^nd round, the Federal Circuit remanded the matter back to the District Court for trial on damages. In the meantime, Google filed a petition for certiorari before the Supreme Court on the Federal Circuit’s determinations regarding both copyrightability and fair use. The SCOTUS granted certiorari and issued its final judgement on 5th April, 2021.

Introducing APIs

I do not want to spend too much introducing APIs – there are tons of resources available, and the judgment provides a decent summary. In simple terms, APIs allows one program to interface with another and adds efficiency to the entire system. For instance, someone may have already written a package/code for performing a specific function (say, multiply x*y). If I came up with an application that, inter alia, performs this same function, rather than rewrite the package/code, I can simply call upon package/code. The API is what enables this. In this example, the package/code that performs this x*y is called the ‘implementing code’. This ‘implementing code’ is identified by or associated with a ‘declaring code’. That declaring code provides the name for each task and the location of each task within the API’s overall organisational system. The ‘declaring code’, thus, is a shortcut for programmers to reach the ‘implementing code’.

Appendix B to the majority opinion (Sl. Op. at pg. 38) provides a nice schematic to demonstrate this. I would encourage readers to consider that drawing. The case was limited to the copying of ‘declaring code’.

Summary of the majority’s ruling

1. No final finding on copyrightability. The judgement is limited only to the ‘fair use’ doctrine (Sl. Op. at pg. 15).
2. Computer programs, like any other copyright protected subject matter, is subject to the applicable limitations in law (Sl. Op. at pg. 18).
3. ‘Fair use’ is a mixed question of law and fact. Therefore, even if there were jury determinations on points of fact, a court is entitled to review the ultimate legal question de novo (Sl. Op. at pg. 20).
4. Fair use is an ‘equitable’ doctrine and not a ‘legal” doctrine (Sl. Op. at pg. 20).
5. Nevertheless, the applicable statutory provision, i.e., 17 U.S.C.107, provides for an inclusive set of 4 factors that “indicates” how a court can apply this equitable doctrine. These 4 factors are (Sl. Op. at pg. 13 – 14):
   1. The purpose and character of the use, including whether it is for commercial purpose or for non-profit educational purposes;
   2. The nature of the copyrighted work;
   3. The amount and substantiality of the portion used in relation to the whole; and
   4. The effect of the use upon the potential market for or value of the copyrighted work

6. On the 2^nd factor (Sl. Op. at pages 23-24):
   1. The “declaring code” is intrinsically far away from the “core of copyright”, i.e. less worthy of copyright protection.
   2. This is because even though it is functional in nature, it is “inherently bound together with uncopyrightable ideas”, and more importantly, the value of such a “declaring code” lies in the investment of time and effort by computer programmers who popularise their use, creating the network effect for their consistent use across platforms.
   3. This was the conclusion despite a finding that the creativity in “declaring code” lay in coming up with names that would prove intuitively easy to remember and thus making it popular for programmers/developers to use them consistently.

7. On the 1^st factor (Sl. Op. at pg. 25 – 28):
   1. Google copies only the minimum amount of API required, precisely.
   2. Google used the copied portion to create new products/expand the use of Android-based smartphones.
   3. Google used the copied portion in a distinct and different computing environment (smartphones) compared to the original creation (desktop and laptop computers).
   4. Thus, Google’s copying was “transformative”.
   5. The commercial gain of Google was not dispositive given that the copying was “transformative”.

8. On the 3^rd factor (Sl. Op. at pg. 28 – 30):
   2. The Sun Java API totalled almost 2.86 million lines, and the “declaring code”/copied portion comprised 11,500 lines, i.e., 0.4% of the total.
   3. Even a small amount of copying may fall outside the scope of “fair use” if it forms the “heart” of the original works created expression.
   4. Google copied them not because of their creativity but because of programmers’ familiarity with the Sun Java API system. To not use them would have been prohibitively expensive for Google to attract programmers to build its Android smartphone system.
   5. Since the copying was “transformative” under the 1^st factor, the case must be viewed in the context of the larger code and thus, there was no “substantiality” in the copying by Google.

9. On the 4^th factor (Sl. Op. at pages 30 – 35):
   1. Sun was failing to succeed in the mobile phone market by itself.
   2. Google’s Android platform catered to a distinct and more advanced market (smartphones) than what Sun/Oracle was catering to (desktops and laptops, “feature” phones).
   3. Sun itself saw benefit from the broader use of the Java language in a new platform like Android.
   4. The source of Android’s profitability was more to do with the programmers’ familiarity with Sun Java API and less to do with Sun’s investment in creating the Sun Java API.
   5. To not allow Google to claim fair use would give Oracle the ability to cause public harm – it will create a lock, limiting future creation of new programs (something similar to the hold-up situation that is referred to in the SEP context).

To be continued in Part II.

In Part I of this two-part post, I introduced the SCOTUS’ judgment, the concept of API and summarised the majority’s finding. In this Part II, I summarise the minority opinion and share my critique of the judgment.

The minority’s opinion

The minority agrees with the majority insofar as “fair use” being a mixed question of fact and law. The minority disagrees with everything else. The minority criticises the Courts approach of determining the application of an exception/defence without issuing a finding on the existence of the right, i.e., copyrightability. On this point, the minority endorses that the “declaratory code” is copyrightable subject matter since it fulfils the “minimal degree of creativity” test from the earlier ruling in Feist publications. Among other reasons, Google had conceded that Oracle could have created the lines of “declaring code” in many ways, i.e., the doctrine of merger did not apply in this case. The minority holds that the “declaring code” incorporates “implementing code” – both are inextricably bound, and one cannot function without the other. Therefore, if the “implementing code” is copyrightable (a point considered by Google), the minority held that the “declaring code” could not have a different conclusion (Sl. Op. at pages 4 – 7).

On the 1^st factor of the “fair use” doctrine, the minority criticises the majority’s position to relegate “declaring code” to lower strata of copyright protected subject matter. The statute considers all computer programs as one group and does not differentiate in the threshold/level of protection. Further, the minority ventured, even if the actual value of “declaring code” is contingent on programmers/developers investing in learning it, familiarising and popularising the same, this cannot result in a lower threshold of protection. The minority alludes to examples of other types of copyrighted works where such logic would fail. E.g., a Broadway musical script contingent on the theatre, the actors and singers investing time and popularising it.

On the 4^th factor, the minority notes the majority’s failure to account for the damage caused to Oracle. For instance, evidence suggested that as a direct result of Google’s act, Amazon renegotiated a license fee with Oracle with a 97.5% reduction in royalty rate. Similarly, evidence of Samsung reducing its royalties to Oracle from $ 40 million to $ 1 million was also recorded. Merely because Oracle, by itself, was facing difficulties in the smartphone market, did not preclude Oracle from gaining in that market through licensing arrangements. The alleged possible hold-up situation that Oracle could create was considered by the minority as speculative because other players like Apple and Microsoft created mobile operating systems without using Oracle’s declaring code. Per contra, the minority notes, Google had already been found to have used the Android operating system to violate anti-trust laws. Therefore, alleged potential abuses by Oracle carried little weight as compared to the actual abuse by Google.

On the 2^nd factor, the minority criticises the majority for redefining what is understood by “transformative” in copyright law. The mere fact of making new physical products carrying the verbatim code is not “transformative”. “Transformative” is a term used to refer to adding creativity to the underlying work; not adapting a verbatim copy in another platform. The minority notes the undisputed finding of fact that Google’s use of Oracle’s code was not to reverse engineer a system to ensure compatibility or interoperability. Instead, Google’s copying was a simple case of verbatim copying of the “declaring code” and using it for the same purpose/function but in a competing platform.

On the 3^rd factor, the minority observes that neither Google nor the majority disputed the Federal Circuits conclusion that Google copied the heart or focal points of Oracle’s work. According to the minority, in such a circumstance, especially where Google contribution was not “transformative” of the copied work and was intended to result in a product that competed with Oracle’s potential revenue, the copying was indeed qualitatively and quantitatively substantial.

Some thoughts

The SCOTUS was confronted with the issue for the first time, and it is fair for the Court, especially the highest court of a country, to consider the contemporaneous situation and technological evolution when laying down the law. But I feel that the majority’s opinion is intellectually dishonest.

The fact remains that Google took the easy way out – copying the “declaration code” from Oracle – whereas other competitors such as Apple and Microsoft did not. This copying was admittedly for a commercial purpose, albeit indirectly achieved – Android OS was made freely available, but Google gained tremendous revenue through ad sales. Much of the revenue volume from ad sales was thanks to Android’s popularity and attributable, in part, to the using of Oracle’s “declaring code” that attracted program developers to build for Android platforms.

This undisputed finding of fact settles this point:

“…While Google repeatedly cites to the district court’s finding that Google had to copy the packages so that an app written in Java could run on Android, it cites to no evidence in the record that any such app exists and points to no Java apps that either pre-dated or post-dated Android that could run on the Android platform. The compatibility Google sought to foster was not with Oracle’s Java platform or with the JVM central to that platform. Instead, Google wanted to capitalise on the fact that software developers were already trained and experienced in using the Java API packages at issue…” 750 F.3d 1339 at 1371.

It is precisely at this juncture of reasoning that the majority contradicts itself. The majority recognises that the creative element in the “declaring code” lies in making it intuitively appealing and easy-to-use so that it becomes popular with the programmers. The popularity with the programmers was the intended effect. However, the majority considers this effect of being an independent factor for which Oracle/the creator gets no credit. Instead, the Court uses this fact against Oracle!

If Google used entirely new “declaring code”, programmers would have had to invest time to learn it and familiarise themselves with it. There was every chance for this to have failed, and Android may not have been successful as successful. This tremendous commercial gain made by Google was established at trial to be at Oracle’s cost – the loss of revenue from licensing deals and thwarting Oracle’s effort to enter the market through 3^rd parties.

Consider yet another undisputed fact:

“…[Google and Oracle] negotiated for months but were unable to reach an agreement. The point of contention between the parties was Google’s refusal to make the implementation of its programs compatible with the Java virtual machine or interoperable with other Java programs. Because Sun/Oracle found that position to be anathema to the “write once, run anywhere” philosophy, it did not grant Google a license to use the Java API packages” 750 F.3d 1339 at 1350.

Given this finding of fact, for the SCOTUS to have used a potential/speculative hold-up by Oracle as a factor against Oracle is a non-sequitur.

Finally, the minority’s criticism of the majority is an approach to redefine what is “transformative” hit the nail on its head. It is an excessive twist to the principle – the copied work was not transformed in any way – it was simply copied verbatim and applied to a new platform.

Relevance to India

The Supreme Court assumed copyrightability of the “declaring code” of Sun Java API. But it chose not to interfere with the Federal Circuit’s finding that this was, indeed, copyrightable. To that extent, this litigation journey in Oracle v. Google has significant persuasive value in India on the issue of copyrightability of APIs even under Indian law.

On the “fair use” point, most readers will now be aware that the “fair use” doctrine is distinct from the “fair dealing” doctrine under Section 52(1)(a) of India’s Copyright Act, 1957. This fair dealing exception in the Indian law would not be attracted to the facts in Oracle v. Google because the provision is expressly not applicable to computer programs. Section 52(1)(ab) provides a separate exception relating to interoperability, but given the finding of fact that the copying by Google was not for interoperability, even this exception will not apply. On facts, it does not appear that even sub-clause (aa) would apply. On the face of it, none of the other exceptions contained in Section 52(1) of the Indian Act seems to apply. To this extent, the SCOTUS’ judgment in Google v. Oracle has limited value to the Indian legal setting.

Nevertheless, it does show that the SCOTUS can (and often does) engage in some incredible sophistry to reach a particular conclusion, though it may veer far away from its precedents (or even common sense). The conclusion reached by the SCOTUS on the “equitable” doctrine of “fair use” was anything but equitable! Perhaps, someday in the future, this dissent may trigger an overturning. At the very least, for other jurisdictions that attach persuasive value to US jurisprudence, the dissent provides a reasonable alternative view to be considered.

“In Hindsight I wish I had more Foresight” Image by Timothy Appnel, from here. CC BY-NC-ND 2.0

[Co-authored/compiled with Praharsh Gour] 

Earlier this week, Praharsh blogged about the IPAB finally being scrapped through an ordinance, with its powers / duties transferred to High Courts and Commercial courts (for copyright matters).

Long time readers may recall that Prof Shamnad Basheer, after pointing out various issues with it, had first started asking for the IPAB to be shut down 11 years ago, in this post titled “Pondering the legal competence of the IPAB”. Note the following lines – more than a decade ahead of their time. (Or perhaps, the decision (to scrap) is more than a decade behind it’s time). 

“Let me end with a policy question that all of us with some interest in Indian IP need to think through: Wouldn’t it be better to scrap the IPAB? And to have specialist IP benches at the various High Courts (or least at the High Courts of the leading metros).

Judges can always have independent technical and scientific advisors to help them. In fact, pursuant to the creation of a roster of independent experts by the Indian Patent Office (IPO), we are given to believe that more High Courts are now calling for this list and seeking the help of independent experts. Given this infusion of such technical help from the outside, High Courts do not need to induct full time “technical” members.

Apparently, the IPAB’s creation and sustenance at the initial stages (and its Chennai placement) had much to do with the benevolence of Murasoli Maran, an ex-Minister of Commerce. Given that he is now departed, and there appears no political successor on the horizon keen on continuing his legacy, wouldn’t this be the best time to exterminate this body, once and for all?

Tremendous effort from Shamnad and Prashant, aided by others on and off the blog, led to plenty of public discussion on the blog, where issues with the IPAB were discussed and dissected, and alternative futures were imagined. Amidst this was also a public interest litigation challenging the IPAB, filed by Prof Basheer in his capacity as the MHRD IP Chair at NUJS. 

Given the big change that is finally happening, we thought it may be useful to put together a list of the many posts (50 of them! and we may have inadvertently missed some!) we’ve had on the IPAB over the last decade – one might perhaps call it our ‘compilation of the decade’ on this topic! And we hope that the various thoughts so far can help to kickstart more discussions on the matter. We’ve attempted to put together brief one liners on what the posts cover (for those where the title suffices, we’ve just kept the title), and you can see the year and date of the post mentioned in the URL. We’d also highly recommend not missing the comments sections of the posts, as several very valuable discussions can be found in there, thanks to our readers! 

We welcome guest posts that respond to or take forward any of these ideas and try chartering out a path for the way ahead. 

Specialized IP Courts Series by Prof. Shamnad Basheer

1. https://spicyip.com/2016/01/quixotic-courts-tilting-at-the-citadel-of-experts.html Prof. Basheer introduces his critique of specialised courts by highlighting the arguments advanced by Judge Rifkind (made more than 50 years ago!)  and Justice Diane Wood. 

2. https://spicyip.com/2016/02/specialized-ip-courts-part-i-interrogating-the-ipab.html In part II of the series Prof. Basheer assesses IPAB from the lens of its constitutional competence, the pendency of cases before it and institutional bias. 

3. https://spicyip.com/2016/02/specialised-courts-iii-commercialising-the-high-courts.html In Part III of the series, Prof. Basheer makes an argument for specialized benches in the High Courts instead of an institution like IPAB and criticizes the Commercial Court Act, for being inept to the task. 

4. https://spicyip.com/2016/02/specialised-ip-courts-iv-correcting-the-copyright-board.html In part IV, Prof. Basheer advances arguments against the Copyright Board and criticizes it for being non functional. 

5. https://spicyip.com/2016/04/specialised-ip-courts-a-global-perspective-from-the-ictsd.html in the final part, Prof. Basheer highlights one of the contributions in the 2016 ICSID-CEIPI joint report (PDF). The contribution is titled “Specialised Intellectual Property Courts- Issues and Challenges” and is led by Prof. Jacques de Werra. The paper includes country specific analysis of the specialized court system therein. In his contribution to Prof’s De Werra’s lead paper, Prof. Basheer has made a detailed discussion on the situation in India, highlighting the issues discussed above and his solution to overcome them. Notably, his suggestion went as below: 

“I lean in favour of a specialised bench within existing High Courts. While the Commercial Courts Act is a step in the right direction, it does not go far enough in terms of creating a robust framework for cultivating specialised expertise. Neither does it ensure that specialised IP judges experience an eclectic range of legal issues that enlarge their vision and pave the way for a more holistic IP jurisprudence that optimally balances private IP rights against the larger public interest.” 

Writ Petition and related posts

Download writ from here

Download judgment from here

1. https://spicyip.com/2011/01/breaking-news-madras-high-court-admits.html Prashant Reddy – Discussing the admission of two writs (by Prof Basheer and SIMCA) challenging the IPAB and the Copyright Board. 

2. https://spicyip.com/2011/10/update-on-pils-against-ipab-and.html Prashant Reddy – Linking some of the pleadings and correspondences of the PIL

3. https://spicyip.com/2012/04/specialist-ip-court-knowing-more-about.html Prof Basheer – Pondering some options around specialist adjudicators for complex patent disputes

4. https://spicyip.com/2012/07/madras-bar-association-fights-to-save.html Prashant Reddy – Madras Bar Association fights to save independence of key tribunals from the ‘babus’ of the Central Govt. (long post) 

5. https://spicyip.com/2011/09/justice-sridevans-report-exposes.html Prashant Reddy – Justice Sridevan’s report exposes the Central Govt’s apathy towards the IPAB (along with hyperlink to copy of the report) 

6. https://spicyip.com/2014/10/the-taming-of-the-tribunal.html Prof Basheer – Reflections on the SC invalidation of the National Tax Tribunal, implications for IPAB, and two potential policy options for going forward, including having a specialist IP bench at HCs.

7. https://spicyip.com/2012/11/central-govt-dragged-to-high-court-over.html Prashant Reddy – Central Govt. dragged to the High Court over securities tribunal: When will the Govt. learn? 

8. https://spicyip.com/2012/12/legalising-tribunals-judicial-sell-out.html Prof Basheer – On the PIL filed by Arvind Datar on the abysmal records of tribunals in the country, and it leading to the central govt seriously considering an umbrella legislation for tribunals.

9. https://spicyip.com/2014/09/madras-hc-orders-reconstitution-of-ipab-vice-chairperson-selection-committee-2.html– Rupali Samuel- criticizes the process and structure of the selection committee for appointment of the Chairperson and Vice-Chairperson. 

10. https://spicyip.com/2015/03/breaking-news-ipab-key-provisions-struck-down-as-unconstitutional.html– Prof. Basheer breaks the news of Madras H.C decision in Shamnad Basheer v. UoI, striking down key IPAB provisions as unconstitutional. 

11. https://spicyip.com/2015/03/tribunals-in-troubled-waters-highlights-of-the-ipab-decision.html– Prof. Shamnad Basheer- assesses the Madras High Court Decision in the above writ petition. 

12. https://spicyip.com/2015/05/madras-bar-association-nclt-constitutionality.html L. Gopika Murthy – On the SC’s judgment on NCLT’s constitutionality. 

13. https://spicyip.com/2016/06/judging-judges-reviewing-justice-singhs-ip-jurisprudence.html Prashant Reddy – Critical assessment of the High Court decisions of the former Chairperson of IPAB. 

14. https://spicyip.com/2017/06/breaking-news-madras-high-court-cautions-government-againsttribunal-appointments.html Prof Basheer – Madras High Court Cautions Government Against Tribunal Appointments

15. https://spicyip.com/2017/06/madras-hcs-seemingly-ad-hoc-portfolio-allocation-possible-alternatives.html Prateek Surisetti – Reviews some of Prof Basheer’s works and discusses suggestions for allocation of judges to IP matters

16. https://spicyip.com/2017/08/is-justice-manmohan-singhs-appointment-as-chairperson-to-ipab-in-line-with-law-laid-down-in-shamnad-basheer-v-union-of-india.html Prashant Reddy – Critical assessment of the former Chairperson’s appointment in light of the Madras Hight Court decision

Finance Bill and Tribunal Rules

image from here

1. https://spicyip.com/2017/04/the-saga-that-is-the-finance-bill.html Balu Nair – Looks into the constitutional viability of the Financial Bill 2017. 

2. https://spicyip.com/2017/06/government-of-india-launches-occupy-the-tribunals-movement-with-new-rules-on-appointments-to-the-ipab-18-other-tribunals.html Prashant Reddy- Critical assessment of the Tribunal Rules, 2017 which had previously prescribed for appointment criteria of the members of the Tribunals. 

3. https://spicyip.com/2019/11/supreme-court-strikes-down-tribunal-rules-trade-marks-act-to-govern-ipab-appointments-again-till-new-rules-are-framed.html Balu Nair and Pankhuri Agarwal – Assessment of the Rojer Matthew decision which struck down the Tribunal rules 2017. 

4. https://spicyip.com/2020/12/supreme-court-revisits-the-tribunal-culture-yet-again-upholds-the-validity-of-the-2020-rules-but-with-conditions.html Praharsh Gour – Assesses the Madras High Court Bar Association decision, upholding the Tribunal rules 2020.

5. https://spicyip.com/2020/08/dipp-appoints-technical-members-to-ipab-legality-under-doubt.html– Prashant Reddy reports appointment of 5 technical members which could have been made under the 2017 Rules and thus constitutionally invalid. 

6. https://spicyip.com/2020/12/the-legality-of-the-appointment-of-the-5-technical-members-to-the-ipab.html Prashant Reddy- points out the problems with the appointment of 5 technical members to the IPAB in 2020. 

Others / Uncategorized

1. https://spicyip.com/2010/06/revisiting-constitutionality-of.html Prashant Reddy – Revisiting the Constitutionality of the Copyright Board in light of the SC judgement in the NCLT case

2. https://spicyip.com/2011/06/reforming-patents-trademarks.html – Prashant Reddy – Pointing to the lack of uniformity and consistency in procedure as well as outcomes across the various patent and trademark adjudication bodies – and questioning why the IP Bar is so quiet on these issues. 

3. https://spicyip.com/2011/12/guest-post-state-of-tribunals-in-india.html Sai Vinod N – Questioning whether Tribunalization is effectively a ‘Judicial Sell-out to the Executive’ 

4, https://spicyip.com/2012/02/revoking-patents-without-evidence.html – Prashant Reddy – Rueing a decision to revoke a patent on inventive step, without any ‘legal’ evidence provided – tracing this to lack of strong procedural rules at IPAB. 

5. https://spicyip.com/2019/08/spicyip-tidbit-ipab-website-malfunctioning.html And https://spicyip.com/2019/08/mission-report-what-is-the-current-status-of-ipabs-website.html Rishabh Mohnot – on IPAB’s infamous website malfunctioning as well as questions about who exactly owns the website. 

6. https://spicyip.com/2019/10/justice-pratibha-singh-demands-a-reply-from-the-government-of-india-on-the-dysfunctional-ipab-ip-bar-continues-to-be-mute-spectator.html Prashant Reddy – Delhi High Court seeks answers from the government over dysfunctional IPAB. 

7. https://spicyip.com/2020/11/appeals-to-controllers-decision-at-ipab-part-1-manner-in-which-the-appeals-are-getting-disposed-of-at-ipab.html & Part 2. Amit Tailor – Looking into the regular lack of representation of the Controller’s office at the IPAB

8. https://spicyip.com/2021/03/intellectual-property-appellate-advisory-adjudicatory-board.html Amit Tailor – Pointing out that the IPAB was ‘advising’ even when its role was to merely adjudicate. 

Quorum Requirement 

1. https://spicyip.com/2019/01/ipab-continues-to-pass-orders-and-conduct-hearings-despite-losing-quorum.html Rishabh Mohnot- reports on IPAB’s hearings and orders despite lack of quorum.  

2. https://spicyip.com/2019/04/the-nature-of-orders-and-quorum-requirements-at-the-ipab-part-i.html and https://spicyip.com/2019/05/the-nature-of-orders-and-quorum-requirements-at-the-ipab-part-ii.html Rishabh Mohnot- assesses the need of quorum for administrative orders. 

3. https://spicyip.com/2019/05/delhi-high-court-issues-notice-to-dipp-on-vacancies-at-ipab.html Rishabh Mohnot- Delhi High Court issues notice to DIPP on vacancies in IPAB

4. https://spicyip.com/2019/07/curiouser-and-curiouser-the-delhi-high-court-whitewashes-an-infirm-ipab-and-rules-that-a-plant-variety-is-a-patent-and-perhaps-even-a-trademark.html Prashant Reddy- on Delhi High Court’s ruling which approves the PVPAT member to hear patent matters in the tribunal. 

Copyright Board (Some earlier posts repeated in this section since we thought it would be convenient to have a separate heading for the Copyright Board)

1. https://spicyip.com/2011/01/breaking-news-madras-high-court-admits.html Prashant Reddy – Discussing the admission of two writs (by Prof Basheer and SIMCA) challenging the IPAB and the Copyright Board. 

2. https://spicyip.com/2012/09/proposed-copyright-board-likely-to-be.html Prashant Reddy -explains why the Copyright Board, notified under the 2012 Rules is  likely to be held unconstitutional. 

3. https://spicyip.com/2013/03/copyright-rules-2013-designed-to-fail.html Prashant Reddy- criticizes the Copyright Rules 2013 which incorporates the Copyright Board

4. https://spicyip.com/2013/04/scoping-constitutional-challenges.html Prashant Reddy- Scoping challenges to Copyright Board.  

5. https://spicyip.com/2015/09/an-update-on-the-challenge-against-the-copyright-board.html Thomas Vallianeth – An update on the SIMCA writ challenging the Copyright Board.

6. https://spicyip.com/2016/04/securing-the-independence-of-the-copyright-board-on-firmer-legal-moorings-madras-hc-takes-a-step-in-the-right-direction.html Rahul Bajaj – Securing the Independence of the Copyright Board on Firmer Legal Moorings: Madras HC Takes a Step in the Right Direction

7. https://spicyip.com/2017/03/copyright-board-to-be-taken-over-by-ipab.html Pankhuri Agarwal – breaks the news of the Copyright Board being taken over by the IPAB. 

Latest reformulations of for/against arguments regarding the IPAB. 

image from here

1. https://spicyip.com/2020/04/the-case-for-shutting-down-the-intellectual-property-appellate-board-ipab.html Prashant Reddy and Prannv Dhawan – the authors pen reasons for scrapping the IPAB and suggest way forward. (This post includes the staggering calculation that in its 17 years of existence, the IPAB has not had a Chairperson for a cumulative total of 1,130 days)

2. https://spicyip.com/2020/04/the-case-for-keeping-the-ipab-open.html– Arun Mohan- Responds to Prashant’s arguments for shutting IPAB, with reasons for keeping it open. 

3. https://spicyip.com/2020/04/former-ipab-chairperson-supports-the-scrapping-of-ipab-while-ip-lawyers-continue-to-live-in-denial.html Prashant Reddy – responds to Arun’s arguments in favor of the IPAB.

4. https://spicyip.com/2020/04/the-case-for-keeping-the-ipab-open-part-ii.html Arun Mohan – Responds to Prashant. 

5. https://spicyip.com/2020/08/breaking-news-controller-generals-office-agrees-with-our-petition-for-scrapping-the-intellectual-property-appellate-board.html Prashant Reddy – Comments of the Controller General agreeing to shut IPAB down

6. https://spicyip.com/2021/02/justice-prabha-sridevan-on-proposal-to-shut-down-ipab-and-the-way-forward.html Justice Prabha Sridevan – Elaborates on the arguments in favor of shutting the IPAB and suggests way forward. 

7. https://spicyip.com/2021/02/breaking-supreme-court-dismisses-application-seeking-extension-of-retd-justice-manmohan-singh-the-incumbent-chairperson-of-the-ipab.html Praharsh Gour assesses the Supreme Court’s decision on controversy surrounding appointment/ extention of the former chairperson of IPAB and notes the continued holding of hearings despite the above order.

Image from here

It is a common practice for political parties to utilise songs, either original or non-original, as part of their election campaigns. Like most other things in life though, politicians have frequently thought themselves above the law when it comes to asking for permissions for using copyrighted songs! It has led to protests in countries such as the United States by artists against political usage of their music. A prominent controversy involving Rihanna’s objection to Donald Trump using her songs at his rally was covered on the blog earlier. Amidst the recent wave of elections in India, this issue seems to have propped up again. We recently came across a clip that involved the video of the super catchy (and subversive) song Enjoy Enjaami by Dhee and Arivu with superimposed audio, prompting voters to vote for a political candidate. While the clip has been shared widely on social media, in full disclosure I have not found any clear endorsement of the same by the concerned candidate or the political party. Notably, similar parody songs have recently been used in a widespread manner in political campaigns to project political leaders as the ideal candidates that voters should vote for. By using the specific case of the Enjoy Enjaami parody, in this post I examine the legal validity of use of copyrighted songs by political parties as part of their campaigns.

Copyright

There does not appear to be any indication that any appropriate license has been sought for the usage of the song. If any readers have further information on the same, do let me know. For the purposes of theorising through this post, I will commit the logical fallacy of assuming absence of evidence is evidence of absence. In absence of a license, as the clip uses the video of the song directly, it is prima facie infringing the copyright in the cinematographic work. It now needs to be assessed whether it falls within the ambit of any of the exceptions provided in Section 52 of the Copyright Act, 1957.

There is no provision in Section 52 that categorically permits use of works for political campaigns. The only possible manner to seek protection for the work is by bringing it within Section 52(1)(a)(ii) that exempts ‘fair dealing’ for the purposes of ‘criticism or review’ of any work. As I noted in an earlier post, where the focus of attention of the author of the work is not the underlying work it could be considered to be for the purpose of criticism or review, and that these terms should be given a liberal understanding. In this light, it is possible to consider such use of songs with superimposed audio as a ‘review’ of the work. It, thus, remains to be seen whether the use amounts to fair dealing.

As highlighted earlier, determination of fair dealing entails analysis of four factors. First, the purpose and character of the use needs to be seen. In this case, it cannot reasonably be stated that the purpose of use here is entirely non-commercial in nature. The use being made for political goals has the accompanying aim of securing power for the interested party which in turn also has monetary benefits involved in case the candidate is successful. The character of use, however, could be considered to be transformative in nature since the superimposition of the audio considerably changes the nature of the work.

Second, the nature of the underlying work has to be determined. Lesser protection is available to factual works but more protection is granted to creative work. Since the underlying work here is a song which is a creative work, this factor is against the use being considered fair dealing. The third factor concerns the amount and substantiality of the work used. In the instant case, the clip not only contains quantitatively significant (approximately 10%) portion of the underlying work, but it also contains qualitatively significant scenes from the diverse landscapes portrayed in the song. This factor, thus, is also possibly against fair dealing.

Finally, the effect on potential market of the song needs to be determined. It is difficult to imagine that this election clip will have any substantial impact on the market of the original song given the differences between the two as well as the distinct popularity of the original. It might even possibly end up increasing popularity of the original. This factor is, thus, in favour of it being fair dealing. As there appear to be conflicting conclusions on the outcomes of the four factors, it is difficult to conclude whether the use will be considered fair dealing. I, however, believe that in light of the specific purpose of the use being to serve political goals as against a bona fide creative work, there is a large possibility of the song being considered to be infringing the original work.

Other Remedies

In case the artists of a song that has been misappropriated in a political campaign deem such use to be objectionable, they have three more possible mechanisms to object to this use. First of all, artists have a right to publicity (see here) with respect to the association of their identity in any form such as name, personality trait, or voice, with any work. Admittedly, there remains a debate as to whether this right is to be formulated as a privacy right or a property right, for the purposes of present discussion, either of the two will entitle the concerned artist to object to any inappropriate use of their work. This is because this use allows political parties to gain popularity at the behest of the artists whose work is being misappropriated.

The second mechanism available is that of invocation of moral rights of authors. These rights are enumerated in Section 57 of the Copyright Act and allow authors to seek damages as well as injunction if their work is distorted, mutilated, or modified, in a manner such that it is prejudicial to their honour or reputation. Accordingly, if an artist’s work is used by a political party that stands for principles contrary to the artist’s beliefs, and thereby prejudices their honour or reputation, this provision can be used to restrain such usage. For instance, in the specific case of the above clip, it co-opts the ideas of importance of the agrarian population as depicted in the song. If the artists deem such co-option as possibly untrue, thereby prejudicing their honour, they can invoke their moral rights to challenge it. This is possibly the reason why in the US where performance rights organisations grant license to use works in public performances, a specific political entities license is provided from which artists can remove their songs if they wish so.

Finally, a claim is also possible under the Trademark Act if the artist can indicate a mark such as the label which has produced the work which might be infringed either by way of likelihood of confusion in the minds of consumers or by way of dilution of its reputation. This, however, offers a weak remedy since it is difficult to establish any specific mark which is affected by such a parody of the song, and then to substantiate with evidence as to how it is infringed by such use.

Concluding Thoughts

There exists a strong argument that allows for artists to restrain political parties from misappropriating their work. This right, however, has been sparsely utilised in the Indian context. Apart from the possible monetary benefits that the artists of these songs miss out on, there also exists another important factor that goes unnoticed. This can be seen from the example of Enjoy Enjaami which, apart from its fame as a trendy song, is a ‘politically loaded’ song, challenging oppression and caste discrimination and recognising the importance of nature and communities that are ignored by the mainstream media. Similar is the case with parodies of folk songs belonging to various communities. If misappropriation of such works takes place without due credit to its originators and without acknowledging the purpose sought to be served by these songs, it further concretises the role that the marginalised have traditionally been allocated in political spheres, that of meek spectators whose relevance is restricted solely as a vote bank. In such circumstances, their interests and concerns are ignored and their art and culture are used to woo them only to conveniently ignore them after elections. This possibly makes it even more important for artists of such works to recognise the existing rights vested in them under the law and to utilise them as a mark of protest against the exploitative strategies adopted by various political parties. Such exercise of rights could turn copyrights into an imperfect but important means of rebellion against the subjugation of vulnerable communities.

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We’re pleased to bring you a guest post by Dr. Sunanda Bharti, analysing the position of law on registration and infringement of position trademarks. Sunanda is an Assistant Professor in Law at Delhi University and has written several guest posts for the blog in the past.

Position of Position Trademarks and Related Confusion

Dr. Sunanda Bharti

Recently, Tefal was in the news for being denied registration for its famous ‘red dot’ mark in the UK, which was initially claimed to be a position mark, as it occupies a central position in their woks and pans. Later it was clarified to be a figurative mark, since the UK does not expressly recognise position marks, unlike the EUIPO. Though the denial was on different grounds, not relevant for this post, the episode threw up an important tangential issue concerning position marks, i.e. when or how a mark/sign used as a position trademark (TM) (i.e., to depict its placement on the good) can be considered as distinctive or to have acquired distinctiveness, and when such a mark would be considered as infringed.

What are Position Trademarks?

With effect from 2017, the EU introduced new varieties of TMs — and amongst them, the ‘Position Mark’ was introduced as a separate category. The EU TM Manual defines a ‘Position TM’ as “a trademark consisting of the specific way in which the mark is placed or affixed on the product…”.

Position marks are considered as ‘non-traditional marks’ or ‘non-conventional marks’. In India, the definition of trademarks under section 2(1) zb of the Trademarks Act, 1999 (‘Indian TMA’), sets out the requirements when a ‘mark’ can be considered as a TM. They are (i) mark must be distinctive and (ii) mark must be capable of graphical representation. Distinctiveness means that a mark must have the capacity to distinguish the goods and services of one person from those of the rivals/competitors. Graphical representation indicates that the mark should be capable of being drawn on the Register.

Since non-conventional marks are usually based on sound, smell, taste, textures etc, they are often unable to meet these two compulsory requirements conjointly, making them fall outside the realm of conventional trademarks.

Despite the above, marks which are incapable of aligning with the above norm, like sound marks, have been registered in India by stretching the legal argument that distinctive sounds can be illustrated on paper through musical notations –hence they conform to the requirement of graphical representation. An easy example is Yahoo!’s yodel—which was the first ever non-conventional mark to be registered in India in 2004. The mark consists of the sound of a human voice yodeling the word ‘YAHOO!’. It is registered under Classes 35, 38 and 42 with Trademark Application No. 1270406.

Thereafter,  the TM Registry seems to have warmed up to the idea of registering sound TMs, as we have had ICICI Bank Ltd. getting itself a registered sound mark under Class 36 with Trademark No. 1807773 in 2009; Whirlpool Properties, for Class 35, with TM No. 2156191 in 2011; Hero Motocorp Ltd. getting it for class 12 and 37 with TM No. 2529021 in 2013; and Citi Group Inc. getting it under class 9, 35 and 36 with TM No. 4061035 in 2019.

For the rest of the unconventional TM category, India is yet to open its account. Position marks can be considered as one such unique category that has emerged off late in the non-conventional TM panorama, challenging the traditional TM regime in its own way.

The WIPO Standing Committee on the Law of Trademarks, Industrial Designs and Geographical Indications, while elaborating on the representation of non-traditional TMs, mentions that “under certain national systems, position marks are treated as a subset of other types of marks, such as figurative or three-dimensional marks.” This seems to be the current Indian position as well. Despite that and given that our system does not expressly recognise such marks yet, I have attempted, in the following paragraphs, to explore how such position marks fit into the global TM matrix.

Graphic Representation of TM Showing Position is Imperative

When registration is sought for a TM, graphic representation of the same for the purpose of registration proceedings and putting it on the Register of TMs is the norm and this is likely to hold true for position marks as well. However, per my assessment, in case of a position mark, this need becomes critical. It is because the competent authorities and the public should not only be equipped to identify what is protected but also for what position on the good/product. This is substantiated by the requirement of the EUTM Manual that “reproduction must appropriately identify the position of the mark and its size or proportion with respect to the relevant goods.” Elements that do not form part of the subject matter of the registration “shall be visually disclaimed preferably by broken or dotted lines.” (see Picture 2 towards the end of post).

Another insight is given by the Japan TM Manual that clearly specifies that application for registration would not be considered as proper in ‘cases where the position of the mark cannot be defined; [such as where] enlarged image of a part of the goods is presented without showing the entire shape of the goods, consequently making it impossible to define the position of the mark, relative to the entire shape of the goods, etc.’ (see Picture 1 below).

Picture 1: Source/Japan TM Manual

As inferred from the numerous examples of registered position marks in the EU, a position mark essentially is an amalgamation of 2 features/elements–

a) the sign, symbol or mark, or word etc. that is intended to be used as a mark, and

b) the position or placement (coordinates) of the above on the good/product.

The Distinctiveness of Position Marks

Presently, literature on position marks is negligible. I have not yet found any authoritative commentary on the same. Strangely, even in the jurisdictions where they are recognised and are registrable, there is hardly anything available on how they are different or similar to regular TMs. However, some logical inferences may be drawn from the existing registered position marks and TM Manuals of foreign jurisdictions.

Based on the above preface, I submit that since the underlying basis of using or seeking registration for position marks is its placement on the good, the sign/symbol/mark element of such position marks should be seen in the context of its position in order to decide the distinctiveness of the TM. The sign cannot be considered in isolation.

It is perhaps because of this that the EUTM Guide also makes representation of the position as mandatory. This essentially means that ‘graphical representation’ requirement in relation to position marks operates a bit differently—mandating the proprietor to not only give a 2 dimensional visual of their TM but also the position of that TM on the concerned good.

Further, if the proprietor is dealing with a range of goods, they must give a specific representation regarding placement of the sign on each good. This would become important to determine infringement episodes.

This being said, some other complexities come to mind: for instance, in a case where a certain position mark has been registered in respect of shoes, would the unauthorised application of the position mark in respect of tee-shirts be considered as infringement?

Consider the following registered TM.

Picture 2: Green Frog Position TM for Shoes

The stylised design of a green frog is a registered position TM for a shoe in the EU.

If the same is unauthorisedly used on the pocket of tee shirts by the defendant, would it be considered as infringement on his part? Or would it be considered as a case of infringement only if the defendant uses it on shoes and also chooses the same coordinates for placement of the frog device?

Absence of substantiating case law and literature on the subject makes the scenario quite muddled. It seems that the regular parameters of identity and/or similarity of the two concerned TMs and identity/similarity/dissimilarity of goods or services covered by the TMs would be insufficient to establish infringement in cases of position TMs—because ‘where’ the TM has been positioned by the defendant would add the third dimension, which might become an important, if not the deciding factor.

Another related and crucial question is whether distinctiveness of a position mark would be considered as lost or diluted in the above case if the frog TM were used, (either in identity or colourable imitation thereof) on tee-shirts or an unrelated different good, say stationery? Or would it be case sensitive—depending on the distinctiveness of the sign/mark element–as considered in isolation? Take the pattern of design on Picture 3 below, which is another registered position mark in the EU, in respect of apparel.

Picture 3: Greek Cross in Red, Position TM for Back of Clothing

A Greek cross is a variant of the Christian Cross, which, in isolation from the position on the back of the clothing, as depicted above, could be taken as very ordinary and commonplace. If such a mark, in the same red colour, is unauthorisedly used by the defendant on say shoes or canvas bags? Would it be infringement of the above registered Position Mark, or would the mark, being commonplace, elicit a different result?

Postscript: Unfortunately, there are more questions than answers right now, in relation to position marks. However, with case series like Christian Louboutin SAS v. Pawan Kumar and the judicial quagmire that followed (already covered on the blog here), it would be good on our part to proactively develop adequate sense of what all rights a position TM may have—Just as a single colour has been found fit enough to be registered by the Indian Registry, tomorrow a certain position mark having transnational reputation might find its way into the Register through the back-door entry of acquired distinctiveness—leaving us baffled. Readers are invited to share more on this.

Topical Highlights

SCOTUS Decision in Google v. Oracle: Distorting ‘Fair Use’ but the Scathing (and Logical) Dissent is the One Saving Grace

In Part I, Adarsh summarizes the recent SCOTUS ruling on Google’s copying of roughly 11,500 lines of code relating to 37 software packages forming part of Sun Java API, owned by Oracle. The court renders no finding on copyrightability and has restricted itself to the question of fair use by undertaking the four-factor analysis. On ‘Nature of the copyrighted work’, it holds that “declaring code” is intrinsically far away from the “core of copyright”, i.e. less worthy of copyright protection. On ‘Purpose and Character of use’, it rules that the use of required amount of APIs for creating new products/expand the use of Android-based smartphones is transformative. The ‘Amount and Substantiality’ is interpreted in light of the use being transformative. The 11,500 lines from a total of 2.86 million lines, amounting to only 0.4% of the total was used not because of its creativity, but because of programmers’ familiarity with the Sun Java API system. On ‘Market Effect’, it finds that Google’s Android platform catered to a distinct and more advanced market (smartphones) than what Sun/Oracle was catering to (desktops and laptops, “feature” phones). To not allow Google to claim fair use would give Oracle the ability to cause public harm – it will create a lock, limiting future creation of new programs. Thus, it is a case of fair use.

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In Part II, Adarsh discusses the minority’s dissenting opinion and critiques the majority ruling. The minority criticises the Courts approach of determining the application of an exception/defence without issuing a finding on the existence of the right, i.e., copyrightability. It finds the APIs copyrightable, as they fulfill the originality standard of ‘minimal degree of creativity’. On the ‘Nature of the copyrighted work’, the minority criticises the majority’s position to relegate “declaring code” to lower strata of copyright protected subject matter. O ‘Market Effect’, the minority notes the majority’s failure to account for the damage caused to Oracle. On ‘Purpose and Character’, it opines that the mere fact of making new physical products carrying the verbatim code but in a competing platform is not “transformative”. On ‘Amount and Substantiality’, the minority observes that neither Google nor the majority disputed the Federal Circuits conclusion that Google copied the heart or focal points of Oracle’s work. Agreeing with the minority’s criticism of the transformative use finding of the majority, Adarsh then points out that the majority fails to attribute Oracle for the declaring code’s success. The tremendous commercial gain made by Google was at Oracle’s cost – the loss of revenue from licensing deals and thwarting Oracle’s effort to enter the market through 3rd parties. He then discusses Indian copyright law on software, and concludes that the SCOTUS decision has limited value for India.

Breaking: President Promulgates Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance 2021

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Praharsh reported that subsequent to the Tribunal Reforms (Rationalisation and Conditions of Service) Bill 2021, proposing to scrap IPAB, not being passed in the present session, the President, on 04/04/21 promulgated the Tribunal Reforms (Rationalisation and Conditions of Service) Ordinance 2021 (pdf) using the powers under Article 123 (1) of the Constitution. He has reproduced the Transitional Provisions of the Ordinance laying out the plan for the matter currently pending before the IPAB.

Thematic Highlights

Vote for Enjoy Enjaami?: Elections, Parody Songs, and IP

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Nikhil discusses the issue of unauthorized use of songs for political campaigns, in light of the use of the song Enjoy Enjaami by Dhee and Arivu with superimposed audio, prompting voters to vote for a political candidate. Proceeding on the assumption that this case of use was unlicensed, he surmises that this would amount to a prima facie case of infringement under the Copyright Act. He explains that while there is no specific exception covering this use under Section 52, the ‘fair dealing’ exemption for the purposes of ‘criticism or review’ of any work under Section 52(1)(a)(ii) may be liberally interpreted to cover this case. Undertaking a fair use analysis, he notes that the four factors support conflicting conclusions. However, since the use in question is to serve political goals as against a bona fide creative work, Nikhil argues that this should be seen as a case of infringement. He then points out that the owners of the song may have remedies available to them under publicity rights, moral rights under Section 57, and the Trademark Act. He concludes that misappropriation of ‘politically loaded’ songs such Enjoy Enjaami which challenge oppression and caste discrimination and recognise the importance of nature and communities should be restrained because such misappropriation ignores the interests and concerns of marginalized communities and utilizes their art and culture for political ends.

Non-Fungible Tokens (NFTs) and Copyright Law: A “Nifty” Dilemma

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In a guest post, Avani Kelkar explains the concept of Non-Fungible Tokens and how they interact with copyright law. She discusses in detail how an NFT is a unique digital asset (token) that is minted, recorded, and traded on blockchain technology and can be used to determine the authenticity and ownership of a particular asset or item. Since the sale of an NFT involves making a copy of the creative work and communicating it to the buyer, any unauthorized reproduction, distribution, or adaptation may amount to copyright infringement on account of Section 14 of the Copyright Act. She elaborates that most NFT sales merely convey a license to use the digital copy of the creative work and the author or copyright holder retains their copyright. In purchases, the governing digital contract – which may be shaped according to the parties’ wishes – underlying an NFT determines what rights a buyer has with respect to the digital copy of the creative work that they receive. She concludes that NFT’s have ushered in a significant change to the art world by somewhat democratizing the experience related to a creative work such that the general public need not be restricted from being able to view the artwork.

Non-Fungible Tokens (NFT) Sales and Copyright Assignment: Part I (The Contract is the Key)

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Adarsh discusses issues relating to NFTs purchase contracts. He begins by recounting the legal understanding of NFTs and their operation on blockchain technology. He explains how the problem of easy replication of digital works is solved with NFTs as the original work can be identified by associating it with an NFT because the other copies of the work floating around will not be related to the NFT. Exploring the question of whether purchase of NFTs is a copyright license, an assignment, or simply a transfer of ownership, he argues that the answer depends entirely on the contract and nothing in Indian copyright law prevents such contracts from assigning or licensing the copyright, or simply selling the copyrighted article without dealing in the underlying copyright. However, he cautions that since this digital space is also being built on existing real-world commercial practice, it would be illogical not to have such a contractual term on copyright treatment while valuing the NFTs to have such high values. He also notes that NFT marketplaces entitle creators/authors to set up a recurring royalty term on future downstream sales by the purchasers, allowing flexibility to implement authors’ royalty rights under 2012 Amendments with ease.

Non-Fungible Tokens (NFT) Sales and Copyright Assignment: Part II (Some Issues for Discussion)

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In this post, Adarsh questions his previous assumptions 1) copyright subsists in the underlying work/digital asset, and 2) The owner of the copyright has created the NFT. In case there is no copyright over the underlying assets, no issue relating to assignment or licensing arises. However, if the copyright owner is not the one who has created the NFT, Adarsh discusses whether a sale by one other than the copyright owner amounts to infringement, and if remedies are available to the copyright owner. He explores the possibility of having verification exercises and takedown measures on platforms, and the extent to which such mechanisms might be needed as per the Information Technology Act. He also highlights the issue of value proposition involved with such transactions, which would be meaningless without proper due diligence over the NFT minter and the work’s provenance. Lastly, he analyses the contentious issue of the effect of an AI-authored work in the present context.

Other Posts

The Compilation of the Decade of SpicyIP Posts on IPAB

Image by Timothy Appnel, from here. CC BY-NC-ND 2.0

Swaraj and Praharsh have compiled a list of about 50 posts on SpicyIP discussing the IPAB and the issues and challenges relating to it. As the IPAB was finally scrapped through a recent ordinance, with its powers/duties transferred to High Courts and Commercial courts (for copyright matters), they recall that Prof Shamnad Basheer had been calling for the shutting down of this tribunal for 11 years. The posts they have compiled consist of several threads of public discussion brought about through the efforts of Shamnad and Prashant, aided by others on and off the blog, where issues with the IPAB were discussed and dissected, and alternative futures were imagined. It includes a PIL challenging the IPAB, filed by Prof Basheer in his capacity as the MHRD IP Chair at NUJS. The complete list with links to specific posts and series of posts can be accessed in this compilation.

Position of Position Trademarks and Related Confusion

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In a guest post, Dr. Sunanda Bharti discusses position trademarks, and how they fit into the existing trademark regime. She begins by explaining how non-traditional trademarks are recognized in EU and India, and the challenges therein. She focuses on the graphical representation requirement which is likely to create an impediment for position marks as they would consist of both the mark itself and the position. On the question of distinctiveness of position marks, she suggests that the sign/symbol/mark element of position marks should be seen not in isolation, but in the context of its position in order to decide the distinctiveness. She then discusses the various complexities involving such marks. Would use of the position mark on a separate product be considered infringement? How would dilution be determines, especially in case of use of unrelated goods? She illustrates with the help of the Green Frog position TM for shoes and Greek Cross TM for clothes. In conclusion, she cautions that our trademark regime must proactively establish rules and norms for treatment of such trademarks lest it be taken by surprise by position trademarks with transnational reputation seeking a place in the Indian register.

Madras High Court Grants Interim Injunction to Kibow Biotech, Making Problematic Observations on Patentability of Subject Matter

Clinical trials here

Praharsh critiques the reasoning followed by the Madras HC in its recent order “making absolute” a previously granted interim injunction in the litigation between US corporate Kibow Biotech and Indian entities La Renon Healthcare Pvt. Ltd. and Stanford Labs Pvt. Ltd. Having discussed the history of the litigation, he contradicts the court’s conclusion that the patent is more than a mere admixture of its components resulting in aggregation of their properties, meeting the requirements of Section 3(e) of Patents Act. He points out that it is not explained how the ‘combined effect’ of the mixture is greater than the sum of its parts. According to him, the court should have completely avoided summarily discussing applicability of Section 3(e) in the present case. Praharsh further explains that the Court’s reasoning for dismissing the Respondent’s arguments on the patented subject matter being an admixture is based on the revocation ruling of the IPAB and the Court’s subsequent order in the Writ petition. However, these two orders have their own set of limitations and are not sufficiently clear on the issue. Thus, Therefore, it would have been better had the Court reserved itself from getting into these intricacies.

Other Developments

Decisions from Indian Courts

• Delhi High Court in Kbm Foods Pvt. Ltd. v. Sachin Gupta, granted an interim injunction against the defendants’ use of the COW device mark and the other essential features of the label and trade dress of the plaintiff either in isolation or in conjunction with each other and thereby causing confusion and deception [April 6, 2021].
• Delhi High Court in Britannia Industries Ltd v. ITC Ltd & Ors. denied an injunction, holding that although the defendants’ packs are similar in appearance to the plaintiff’s packs, the points of similarity are insufficient to render the pack of the defendants confusing or deceptively similar to that of the plaintiff [April 5, 2021].
• Madras High Court in Gem Edible Oil Private Limited v. Carrying On Business At decreed the suit ex-parte in favour of the plaintiff holding that a strong case for grant of injunction protecting the trademark ‘GEM’S GOLD’ had been made out [April 1, 2021].
• Madras High Court in Manohar Singh v. Vimal Sehnaaz (India) granted an order of interim injunction owing to the plaintiff’s continuous usage of the mark ‘BANSURI’. It held that the plaintiff had made out a prima facie case and this was strengthened by their registration [April 1, 2021].

Other News

• Central government has notified the Copyright (Amendment) Rules, 2021 which amends the Copyright Rules, 2013 [See Nikhil’s analysis of the Rules, here].
• US Supreme Court ruled that Google’s use of Oracle’s API is fair use [See Adarsh’s posts on the ruling here and here].
• England and Wales Court of Appeal dismissed an appeal by San Francisco-based digital radio company TuneIn, upholding a finding of copyright infringement by its unlicensed stream of music.
• Brazil’s Supreme Court suspended 10 year statutory term extensions of drug patents due to the public health emergency caused by COVID-19.
• UNICEF’s Executive Director has called for simplifying IP rights for COVID-19 vaccines through voluntary licensing, expressing reservations regarding the TRIPS Waiver Proposal.
• A brief published by ORF discusses the merits of the TRIPS Waiver Proposal.
• Nike and the maker of Lil Nas X’s ‘Satan Shoes’ have reportedly settled a trademark dispute brought by Nike, and the latter will buy back Nike shoes it has sold.

A vial of Remdesivir (image from here)

Amid the ongoing surge in Covid-19 cases, many states in the country are reported to be facing shortage of Remdesivir, an anti-viral drug patented by Gilead. The drug was approved by India’s drug regulator in June last year for restricted emergency use for treatment of Covid-19 patients and is presently being manufactured and supplied by seven Indian companies under a voluntary license agreement with Gilead. In order to address the shortage, the Government has (among other measures) banned its export for now and asked the manufacturers to ramp up its production to their full capacity. However, given the continuing rise in cases and the resultant soaring demand for the drug, it is not clear whether these companies will be able to timely fulfill the demand. 

Last year, when Gilead was yet to launch the drug in the market and the licensed manufacturers were awaiting marketing approval, the Maharashtra Government had announced its decision (put on hold later) to import 10000 vials of a generic version of this drug from Bangladesh (it being the first country in the world to manufacture a generic version of the drug). Individual patients were also reported to be importing the drug from Bangladesh for personal use with the drug regulator’s approval due to its unavailability in India at that time (see also here). There was also a report of a Mumbai based pharma company seeking approval to import the drug from Bangladesh for supply in Maharashtra on a cost to cost basis. 

Given the urgent unmet demand of the drug currently prevailing in many parts of the country, governments, hospitals, pharma companies, individuals etc. may again consider importing the drug from Bangladesh, which has been exporting the drug to many countries. Would such import (after obtaining an import license from DCGI) infringe Gilead’s patent under India’s Patents Act? In this post, I seek to explore the legal issues surrounding this question and revisit the debate on parallel importation of patented inventions in India.

Gilead’s right to prevent import of Remdesivir

Under section 48 of India’s Patents Act, 1970, Gilead, being the patent holder for Remdesivir, has an exclusive right to prevent third parties from importing it to India without its consent. However, this right is not absolute. Under section 107A(b) of the Act, any person can import the drug (without the patentee’s consent) “from a person who is duly authorised under the law to produce and sell or distribute the product”. Therefore, import of Remdesivir by any person in accordance with this provision will not be considered as an infringement of Gilead’s patent rights and Gilead has no right to prevent such import.

Is the import of Remdesivir from Bangladesh covered under Section 107A(b)?

Bangladesh, being a least developed country (LDC), is not obligated to protect product patents under TRIPS until 2033. Therefore, any person in Bangladesh can manufacture, use, sell or distribute a drug which is patented in other countries without seeking a license from the patentee. Pursuant to this, many pharmaceutical companies in Bangladesh (Beximco Pharma, Eskayef Pharma etc.) have been manufacturing generic version of Remdesivir without obtaining a license from Gilead. Now, whether an import from these companies is permitted under Section 107A(b) depends on whether these companies qualify as “a person who is duly authorised under the law to produce and sell or distribute the product”. 

Before the 2005 amendment to the Patents Act, one could import only from a person who was “duly authorised by the patentee” to manufacture and sell the product. This meant that even if the product was not patented in the exporting country or the patented product had already been sold once by the patentee, it could not be imported in India unless the particular exporter was “authorised by the patentee” to manufacture and sell the product in that country. So, since Gilead has not authorised any person to manufacture and sell Remdesivir in Bangladesh, under the pre 2005 provision, a person in India could not have imported the drug without Gilead’s consent. 

However, after the amendment, the requirement of ‘authorisation from the patentee’ was done away with. One can now import a product from any person who is ‘duly authorised under the law’, whether ‘authorised by the patentee’ or not. Unfortunately, however, it is still not clear what is meant by “duly authorised under the law” and it has not been interpreted by any court yet in my knowledge. Going by a plain meaning reading of the provision, as long as a person has obtained marketing approval for Remdesivir from the drug regulation authority in Bangladesh, they would be considered to be ‘duly authorised under the law’ to manufacture and sell or distribute the product. So, a person in India can legally import Remdesivir from them under Section 107A(b) without obtaining permission from Gilead. In fact, as discussed by Prof. Basheer in one of the first few posts on the blog in 2005 here (interestingly, in the context of the anticipated flu pandemic then) and later in another post in 2008 here, an Indian company (which is otherwise not permitted to manufacture and sell Remdesivir in India) could arguably use this provision to even set up operations in Bangladesh (or any other LDC), manufacture the drug there and export it to India and supply it to the Indian market. So far no Indian company seems to have gone this route though.

The Government also seems to have adopted an interpretation that allows such import. This is reflected in a circular that was issued by the Central Board of Customs & Excise (CBEC) on 8th May, 2012 (discussed by Prashant in an earlier post here) clarifying that the IPR (Imported Goods) Enforcement Rules, 2007 will not apply to ‘parallel imports’ under the Patents Act, 1970. The clarification, as stated in the circular, was based on DIPP’s interpretation that Section 107(A)(b) provided for parallel imports, which were defined in the circular as “import of original/genuine products (not counterfeit or pirated) which are sold/ acquired legally abroad and imported into the country, by persons other than the intellectual property right holder without permission/authorisation of the IPR holder.” 

Such interpretation, however, has been met with criticism for hitting at the very essence of the patentee’s exclusive right to import under Section 48 by permitting import of  products whose first sale has also not been authorised by the patentee and vis-a-vis which its exclusive right have thus not been exhausted. It is also likely to be violative of (Article 28 of) TRIPS. A PIL was also filed challenging the legality of the above mentioned Government’s circular, arguing that Section 107A(b) doesn’t permit all kinds of parallel imports but only permits imports from a person who is duly authorized under ‘Indian’ law. The petition was, however, dismissed by the court noting that persons concerned with imports and  affected by the circular could approach the court themselves. Given the ambiguity in the provision and the problems with its plain meaning interpretation, Prof. Basheer and Mrinalini had recommended amendment to it. But till the provision is suitably amended, it would be interesting to see how it would be interpreted by the court if a case comes up before it. 

Can the Govt import Remdesivir under Sections 47 and 100 ?

Other than under Section 107A(b) which allows any person to import, the Government can also import the drug under section 47 and section 100 of the Patents Act. 

Section 47(4) allows for the import of any patented medicines or drugs by the Government (State or Central) for “the purpose merely of its own use” or for “distribution in any dispensary, hospital or other medical institution” maintained by or on behalf of the Government or any other such institution notified by the Government” having regard to the public service rendered by such an institution. The Government is not required to pay any royalty to the patentee for import under this provision. 

Further, section 100 empowers the Central Government or anyone authorised by it to (among other things) exercise or vend an invention (patented or patent pending) for the “purposes of the Government”, which has been argued to impliedly include the right to import the invention as well. Therefore, under this provision, the Central Government or any person authorised by it can arguably import drugs for use in Government hospitals or other entities related to the Government in some substantial way. However, for import under this provision, the Government is required to pay adequate royalty to the patentee. 

Therefore, under the Patents Act, the Central Government as well as any State Government can import Remdesivir from Bangladesh (or any other country) for use in government hospitals and similar institutions, without seeking a license from Gilead. So far no government in India is known to have invoked the Act for importing any drug though – if it does so to import Remdesivir, that would be a first!

Could import be a faster solution?

Although the Indian manufacturers of Remdesivir have indicated that they are scaling up its production, it may take some time for fresh stock to hit the market. The grant of a compulsory license (as been urged by some – see here, here, here and here) could also help increase the supply further, but it will again take time for the new manufacturers to produce and bring the product to the market. Therefore, if sufficient quantities of the drug are available in Bangladesh for immediate export, its import into India may be a faster way to ease the current shortage in the country. Although the larger question on Remdesivir’s effectiveness and use in treatment of Covid-19 still remains open.

(This post was co-authored with Murali Neelakantan. Murali is currently Principal lawyer at Amicus. He is a dual qualified lawyer (India and UK) and among other positions, he was formerly a partner at an international law firm in London, Cipla’s first global general counsel, and Executive Director and Global General Counsel of Glenmark Pharmaceuticals. Murali has also been a long time friend of the blog.) 

While the role of patents in extending monopolies over pharmaceutical products is now widely debated, there is relatively little discussion on the role that trademarks, packaging and visual impressions can play in extending such monopolies. As advertisers are well aware, recall value plays a large role in brand/product recollection and customer loyalty. However, when it comes to pharmaceutical products, this recollection often equates to patient compliance, as patients find it easier to take (for example) the same coloured, same shaped pills as part of a routine. No doubt, this helps ensure that patients take their prescribed medicines as required, but what happens when generic versions of these drugs come out? Generic equivalents of patented products often come out at much cheaper prices after the 20 years of patent protection. However, the strong recall value attached to a product’s visual impression (packaging, distinctive colouration, etc) could mean that a de-facto monopoly is extended indefinitely, for as long as a company has any legal entitlements over that visual impression, such as trademarks, which can be indefinitely renewed.

Seretide Accuhaler (GSK)

There is also an inherent ‘stickiness’, especially for emergency use products, such as inhalers, as patients are unlikely to easily change to a competing brand when they have gotten used to reaching out for a purple inhaler for years. Would the parent of an asthmatic child dare to risk any confusion when they rush to urgently find and administer an inhaler in case of a sudden asthma attack? Very unlikely. This is also true for older patients, busy individuals, those who cannot see well, and those who may not read English well. If there is a monopoly over the colour, there is now a good chance that such patients will not accept the risk that they have to remember the colour of the inhaler they should be using if it is different from the one they were using last month.

AirFluSal Forspiro (Sandoz)

A 2019 case by the European Court of Justice brought this issue to the forefront when it dismissed GlaxoSmithKline’s claims that Sandoz was confusing consumers by using the same purple colour that Glaxo was using, on their inhaler products. Glaxo had launched a Dry Powder Inhaler (Seretide Accuhaler) in 1999, and a Metered Dose Inhaler (Seretide Evohaler) in 2000, both coming in multiple dosage units, and in a purple and white form. When Sandoz brought in its generic version (AirFluSal Forspiro), it did so in a fixed dosage, and in a proprietary inhaler but one which also came in a purple and white form. Glaxo, having had their trademark for the colour purple on their inhalers revoked earlier (the revocation of which was upheld later again in 2020), tried and failed to convince the court that the similar colour scheme would confuse consumers. And Sandoz, pointing out that several other inhalers containing the same active ingredients were also sold in purple, was able to successfully convince the court that different colours signified inhalers containing different types of medications.

The Role of Trademarks in Public Health Concerns

While trademarks are generally understood as consumer protection mechanisms, for consumers to be clear about the origins of the goods they’re buying, there are certain fundamental differences to be kept in mind when looking at how trademarks function for pharmaceutical goods. First off, unlike regular consumer products, medical intermediaries such as doctors, pharmacists, drug regulators and insurance agencies are largely responsible for the selection of the drug, as opposed to the end user. This means that trademarks and visual impressions of the product packaging play a much more limited role in the decision to purchase pharma products than they do in regular consumer goods. As noted earlier though, they do play a large role in the proper and timely consumption of medicines. For products such as inhalers, the visual impression of the product itself, over and above the packaging, may play this role, since the product is what people reach out for in their time of need. Similarly, products such as pills should have their trademark and trade-dress protections limited to the packaging of the product, as opposed to the shape or colour of the pill itself. The right to exclude other brands from the market over the same shape or colour otherwise produces an anti-competitive effect, not to mention that shapes of pills (oval, round, and similar variations) are mostly functional so that patients are able to swallow the pill. As shown by this 2012 study (Kesselheim et al) that examined the influence of pill appearance on patient behaviour showed that, ‘patients who experience changes in pill color in particular have an increased risk of interruptions in medication use.’

We would argue here that even if a peculiar shape does become distinctive (as required in trademark law), then the public health interest in ensuring patients are aware of generic equivalents by allowing competitors to copy that shape, outweighs the ill-suited trademark justification for monopoly rights over said shape.

In fact, in the above case too, Glaxo’s Accuhalers containing different API were differentiated on the basis of different colour combinations – purple for the above APIs, blue for Salbutamol, green for Serevent, orange for Flixotide. Such differentiation enables patients to distinguish “their” medicines/ paraphernalia from others used for different purposes, without having to be sure about long and complicated medicinal product names.

The lack of adequate regulation around trademarks and trade names for drugs has already been known to cause very dangerous confusions. For example, ‘Olvance’ is a brand name for an antihypertensive drug, Olmesartan. ‘Oleanz’ is a brand of an antipsychotic drug, Olanzapine. Both have been approved by the drug regulator and have been known to cause confusion. Despite several courts highlighting this type of confusion (see Cadila v. Cadila paras 22-27), nothing has been done to improve the situation.

Dr. Scaria and Kavya Mammen in their 2017 paper also point to the dangers around the perceptions of low quality’ that is sometimes associated with generics, arguing that ‘monopoly rights over physical attributes of branded drugs may perpetuate the myth of “low quality” generics”.’ Concerns regarding quality of drugs, after all, are to be handled by the drug regulator, regardless of branded or non-branded version.

If we accept that consumer protection in the case of pharmaceutical products requires a different understanding of the role of packaging and visual impressions as compared to standard consumer goods, then it becomes clear that ‘origin of the product’ is no longer the most important factor to be communicated. Rather, it is more important to ensure that regardless of manufacturer, patients are clear on what medicines they are consuming. In Cipla v. MK Pharmaceuticals (2007), the Delhi High Court expounded upon this, stating that there cannot be monopoly over colour and shape. The court was on the right track with this statement, but then got distracted by quality and nature of the medicines, which have nothing to do with the Trade Marks Act. The court there would have been right to affirm that the trademark is no more than an indication of the source of goods. The ‘no monopoly over shape and colour’ point seems to have been ignored though, in Pfizer v. Mittal Nathalal Patel (2014), where the Delhi High Court thought of the shape and colour of Pfizer’s “little blue pill” as a ‘trade dress’ even though consumers don’t actually see the pills when they are sold/purchased. The lack of clarity on this point is something which needs to be addressed in future orders.

As long as drug regulators are doing their jobs, branded versions of drugs are perfectly substitutable with their generic equivalents – and given competition concerns, it is important to ensure that artificial barriers such as monopolies over product recallability (through packaging, visual impression, etc) do not come in the way of allowing this substitutability. In 2015, the US FDA published a (non-binding) guidance document for industry, where they stressed that they were “concerned that differences in physical characteristics (e.g., size and shape of the tablet or capsule) may affect patient compliance and acceptability of medication regimens or could lead to medication errors.”

In a previous effort to ensure that patients were made aware of generic substitutability of drugs, the Indian government mandated that doctors were to only prescribe medicines by their non-proprietary names. Given the vast divides in the country (linguistic, urban, rural, etc), this uniformity in writing prescriptions would also ensure minimal mistakes or accidental negligence on part of the doctor or pharmacists in handing out the medicine. However, this has had limited success as there is no real way of enforcing this and doctors opposed this idea, asking the government to regulate the prices of the drugs instead of putting a leash on the doctor’s right to prescribe a medicine. In addition, even if used, non-proprietary names are still often long and complicated, thus reducing their utility so far as the common man is concerned.

Plain packaging on cigarette boxes

In fact, the reason that cigarette packages now have large warning signs and plain-packaging with minimal trademark usage, also stems from a re-wired understanding of the role of visual impressions of products, in the context of public health. That was a measure to prevent public health harms. Perhaps it is also time to explore measures which could increase public health gains, such as whether ‘colour coding’ of equivalent pharmaceutical products would help with more patient compliance.

Such a move also fits in well in the context of considering the global south wherein a large part of the population is unable to read or write their own names, let alone read complicated names of pharmaceutical products. The Indian Supreme Court noted this socio-economic reality in Cadila Healthcare Ltd. v. Cadila Pharmaceuticals Ltd. in the following words:

“ In a country like India where there is no single common language, a large percentage of population is illiterate and a small fraction of people know English, then to apply the principles of English law regarding dissimilarity of the marks or the customer knowing about the distinguishing characteristics of the plaintiffs goods seems to over look the ground realities in India. While examining such cases in India, what has to be kept in mind is the purchaser of such goods in India who may have absolutely no knowledge of English language or of the language in which the trade mark is written and to whom different words with slight difference in spellings may sound phonetically the same”

Perhaps, it is time to try new policy suggestions, like uniform colour schemes for similar drugs, which will not only assist patients in being aware about the medicines they are taking but also will help the pharmacists in differentiating between phonetically and visually similar drugs. Or perhaps in the context of branded names having more ‘stickiness’ quotient with medical intermediaries, another more radical suggestion could be requiring that ‘branded’ names, which gain from the initial years of market exclusivity, are converted into generic names after the expiry of the patent! Regardless of what suggestions are finally taken on board, it is imperative the larger public interest reframes these traditional understandings of norms around product design and packaging, so that social welfare maximising alternatives can be rolled out.

[This piece has been co-authored with Swaraj Barooah]

Image from here

In what seems like a  whiff of good news amidst the debacle surrounding availability of  COVID-19 vaccine in India, the Central Government has permitted the Haffkine Institute to manufacture Covaxin, on  a “technology transfer” basis, for a period of one year. This is definitely needed and hopefully will address the vaccine shortage in the country to some extent. But does this mean that the Central Government had the IP and technology transfer rights over Covaxin all this time? 

Haffkine Institute claims to be one of the oldest “biomedical research institutes” in the country. It was established in 1899 by Dr. Waldemar Mordecai Haffkine, a student of Louis Pasteur, to fight off the Cholera epidemic in Bombay and Poona back in the 1890s (poetic eh?). Presently, the institute is governed under the aegis of the Maharashtra Government (also see here), with the Minister of Medical Education of the State serving as the President of the Governing Council.  While the details of this arrangement between the Central Government and Haffkine Institute are still a bit unclear, this newspaper report suggests that the initiative for the collaboration was taken by the Maharashtra government through a request last month. It was during this press conference the Chief Minister asserted that the Haffkine institute is capable of producing 22.8 Cr. doses of vaccines annually and should be given permission to manufacture Covaxin. Subsequently, this request was apparently approved by the Prime Minister. 

Necessary but not Sufficient 

While India is waxing eloquent about the importance of not letting IP be a barrier in access to medicines during this pandemic, things are a bit murkier with regard to IPRs on publicly funded research back home. Readers may remember the piece by Anupriya and Swaraj (here) which discussed this issue in a bit more depth. 

Covaxin is developed by a collaboration between ICMR and Bharat Biotech and considering the public money involved, suggestions were made that the Centre should acquire the IP on it and make them available as public goods. The earlier mentioned blog post noted the lack of clarity on the ownership of Covaxin, and asserted that in case the Indian government does own the rights to Covaxin, India must forgo them for the sake of its rapid dissemination to the public, both in India and abroad. The wording of the current “approval” to manufacture Covaxin for the next one year, seems to indicate that the Central Government has the rights to be able to give the permission. It’s unclear what the details are though. Is this a license – and if so, what are the details and royalty charges, etc? Is there a temporary waiver of the relevant IP, along with the technology transfer to the Haffkine Institute? Is the government somehow only the custodian of the know-how, but not the IP? Why are they only giving this permission to Haffkine Institute – and why did it take one month to give this permission? If any readers have more clarity on these questions, please do let us know. 

Significantly – if the Central government has the authority to give this permission to Haffkine Institute – what is stopping them from opening this out to institutes and production facilities across the country and the world? 

Permitting the institute to manufacture the vaccine on a “technology transfer basis” creates a presumption that the Centre has the control over the IP behind Covaxin. In this vein, it is somewhat problematic to see why the government decided to hold back and not make available the patents for the vaccine as suggested above. Doing so would have enabled other entities capable of manufacturing vaccines, to contribute and ramp up production of Covaxin extensively. It would certainly mark a big step towards universal vaccination, especially for the non-rich countries that are being relegated to second class citizens on the world stage. India is currently one of the 24 countries which meets the requirements of the WHO vaccine assessment tool for manufacturing vaccines, and is one the few countries where approved vaccines for COVID are being manufactured. As this Business Today article notes, India houses at least 7 capable vaccine manufacturers (SII, Bharat Biotech, Panacea Biotech, Sanofi’s Shanta Biotech, Biological E, Hester Biosciences and Zydus Cadila) apparently capable of manufacturing 8.2 billion doses altogether.  And who knows how many capable manufacturing sites exist world wide. In current circumstances, if the patents on the Covaxin are made available publicly then other entities too can contribute in production of the vaccine, and prevent this arrangement to be just one off.  

On the other hand, Bharat Biotech is also making a version of Covaxin with the US company Ocugen Inc. And that would, conversely, indicate that Bharat Biotech had the rights over Covaxin’s IP. But then why would Haffkine Institute require permission from the Central Government to go ahead? There is an urgent need for clarity on this basic question of who actually owns the various rights, with Covaxin.  And regardless of the specifics – if the Indian government could give permission to one institute, surely it can arrange this for others as well. 

In these times of increased privatisation and with many declaring that the days of PSUs are over, it’s worth noting that Maharashtra, in their effort to get something done on this front, seems to be relying on a health sector PSU in this time of crisis. In this 2017 piece, Murali Neelakantan suggested that to create a market for drugs and ensure their availability at affordable prices “PSUs should participate with other Indian manufacturers”. He notes “this will ensure that the government gets value for money when it is a monopoly buyer in an extremely large market which is currently fragmented with various different entities issuing tenders. It will also ensure that there is technology transfer from patent holders to Indians.” In fact, just before Covid became a household name, the state of California put out a bill that would allow the state of California to create its own generic drug label, in an effort to bring down drug prices. 

As per this article, the approval for the arrangement came from the Secretary of Union Science and Technology Department, as “approval was given by the experts.” But who are these experts, and precisely what arrangement did the approval approve? 

The Mint reported that the Haffkine institute has a laboratory, but not a production facility of the required the bio-safety level 3 (BSL3). While we are unsure what the exact implications are, it prima facie sounds like the institute is not equipped appropriately currently. 

This article reports that the Centre will make available the equipment for production, and the state government has approved a budget of 150 crores for expansion of the production facilities. This is a laudable effort for the long term, however, the success in the next one year for which this arrangement is approved, though hopeful, is perhaps not going to be a simple task. 

Regardless, this arrangement hopefully will mark a dent in this vaccine shortage crisis. Forgetting the possible hypocrisy on the international front (in not keeping this open/widely shared in line with India’s demands for the waiver), on the national front it would perhaps be wise for India to start considering more seriously the ways of extending technology transfer to more manufacturing sites, as well as how to look into the government procurements of vaccine related IP as suggested by Prashant earlier, here, 

Topical Highlight

Indian Govt. Permits Manufacture of Covaxin by Haffkine Institute – But Why Not Others Too?

Image from here

Praharsh and Swaraj consider the recent Central Government approval of Haffkine Institute for manufacturing Covaxin, on a ‘technology transfer’ basis, for a period of one year to address the vaccine shortage in the country. They highlight that the wording of the current ‘approval’ seems to indicate that the Central Government has the rights to be able to give the permission. However, it leaves several questions as to whether it consists of IP rights or only knowhow, if it constitutes a license – based on what terms and royalties – and why it’s given only to Haffkine Institute. They assert that if the government indeed owns IP rights over Covaxin, it should make the IP available to other entities to ramp up manufacturing nationally and internationally to meet the needs of poorer countries who cannot afford the limited doses available. Perplexingly, Bharat Biotech’s partnership with a US Company to make another version of Covaxin suggests that it owns the IP. Thus, there is an urgent need for clarity on the issue. Pointing towards attempts by Maharashtra and the US State of California, they show that some regional governments have undertaken efforts to become monopoly buyers in the pharmaceutical market to be able to provide for public health. They conclude by emphasizing the need for extending technology transfer to more manufacturing sites, as well as government procurement of vaccine related IP.

Thematic Highlight

The Monopoly Purple – Colours, Shapes and Sizes in the Pharmaceutical World

AirFluSal Forspiro

Swaraj Barooah and Murali Neelakantan highlight the role of trademarks, packaging and visual impressions in extending monopolies over pharmaceutical products. They highlight that patients, particularly busy individuals and the elderly find it easier to take the same coloured, same shaped pills or products like inhalers as part of a routine, than switching to generic versions once they become available. The significant role of medical intermediaries such as doctors, pharmacists, drug regulators and insurance agencies in selection of the drug means that trademarks and visual impressions of the product packaging play a very limited role in purchase decisions. Referring to cases such as Cadila v. Cadila, and Cipla v. MK Pharmaceuticals, they argue that even if a peculiar shape does become distinctive, the public health interest in ensuring patients are aware of generic equivalents by allowing competitors to copy that shape, outweighs the trademark justification for monopoly rights over said shape. They also point to previous efforts by the Indian government to ensure that patients were made aware of generic substitutability of drugs, by mandating that doctors only prescribe medicines by their non-proprietary names. They conclude by calling to attention the need for a policy revaluation, with larger public interest reframing traditional understandings of norms around product design and packaging.

Other Post

Remdesivir Shortage: Can the Drug be Imported under Patents Act?

Image from here

Pankhuri explores the question of whether remdesivir can be imported from Bangladesh to meet domestic needs, as its generic version is being manufactured there due to the absence of a product patent regime. She explains that while the Indian patent holder Gilead can prevent imports under Section 48, post the 2005 amendment, the option under Section 107A can be exercised without authorization of the patentee too, so long as it is, ‘duly authorised under the law’. In the absence of clarity regarding this phrase, a plain meaning reading would imply that as long as a person has obtained marketing approval for remdesivir from the drug regulation authority in Bangladesh, it would be considered to be ‘duly authorised under the law.’ This view is supported by a CBEC circular from 2012. However, this risks undermining the very essence of the patentee’s exclusive right to import under Section 48 by permitting import of products whose first sale has also not been authorised. It is also likely to be violative of TRIPS obligations. She then examines whether it may be possible for the government(s) to import remdesivir by invoking Sections 47 or 100. Pankhuri concludes that due to the immediate nature of requirement, importation from Bangladesh would be a better option that providing a compulsory license for manufacture of the drug which would take time.

Other Developments

Decisions from Indian Courts

• Delhi High Court

  Delhi High Court in Telefonaktiebolaget Lm v. Gionee Communication Equipment, permitted the second defendant Syntech technology Pvt Ltd to withdraw its application for revocation of subject patent before the IPAB and to prefer a counter-claim for revocation of patent before the Delhi High Court. [April 16, 2021].

• Delhi High Court in M/S Replika Press Private Limited vs Mr. Sanjay Kumar, awarded an ex-parte ad interim injunction in favour of the plaintiff, restraining the defendant from interfering with the plaintiff’s use of MIS software in any manner, which the defendant had created and developed during the course of his employment with the plaintiff company [April 16, 2021].
• Andhra Pradesh High Court in M/S Guaurav Polymers v. M/S Delight Chemicals Private confirmed the injunction granted by the trial court in light of the likelihood of confusion between plaintiff’s ‘Rising Sun’ trade mark used as a device and defendant’s ‘Surya Magical White’ trademark [November 20, 2020].

Other News from around the Country

• Central Government has prohibited the export of remdesivir till the Covid-19 infection status in India improves. Companies manufacturing the drug are reportedly undertaking measures to increase its production [Read Pankhuri’s analysis of India’s options to import remdesivir from Bangladesh under the Patent Act].
• Central Government has given approval to Mumbai-based Haffkine Institute for manufacture of Covaxin [Praharsh and Swaraj have discussed the issues surrounding this approval].
• Maharashtra CM Uddhav Thackeray has written to PM Modi requesting smoother supply of medical oxygen and remdesivir as well as suggesting the government to grant a compulsory license for manufacture of remdesivir.
• A piece in The Hindu discusses the issues relating to the now defunct IPAB.
• Lahari Audio company has sued the makers of movie ‘Kirik Party’ for infringement of copyright in their song ‘Madhya Raatrili highway rastheli’, leading to the issuance of a non bailable arrest against the latter.
• Filmmaker Vikramaditya Motwane has accused ALTBalaji for plagiarising the poster of Sudhanshu Saria’s romantic drama, Loev (2015) in the artwork of the poster of their new film, ‘His Story’.
• Recent IMI Report suggests that India’s recorded music industry can rival Europe’s in 10 years.

News from around the World

• Image from here

  A group of US Senators including Bernie Sanders and Elizabeth Warren have written to US President Joe Biden urging him to support India and South Africa’s TRIPS Waiver proposal at the WTO.

• The England and Wales High Court has allowed Swatch’s appeal of a ‘bad faith’ opposition filed by Apple against the international trademark application for ‘ONE MORE THING’.
• Germany’s Federal Court of Justice ruled in Solvay’s favor on a patent invalidation case filed by Neo Chemicals & Oxides (Europe) Ltd. against a patent pertaining to ceric oxide products.
• Popular Turkish chef and restaurateur Nusret Gökçe is facing a USD 5 million copyright infringement lawsuit by Brooklyn artist William Hicks for alleged unauthorised use of his artwork on menus, takeout bags, and signs.

We’re pleased to bring to you this post by UNH Franklin Pierce School of Law, sharing a glimpse of the educational and professional journey of its dean Megan Carpenter and what she views as the future of UNH Franklin Pierce’s law programs.

Megan Carpenter, Dean of UNH Franklin Pierce School of Law

Seeing It Through

Dean Megan Carpenter has relished the chance to build on UNH Franklin Pierce’s innovative programs in IP law.

Early in her career working for a big law firm, Megan Carpenter found herself representing the intellectual property rights of start-ups, international multimedia corporations, and even professional wrestlers.

“I was spending the majority of my waking hours every day helping these organizations,” Carpenter, the dean of UNH Franklin Pierce School of Law, told A.J. Kierstead on the law school’s podcast, The Legal Impact. Her work made her think about the allocation of IP rights throughout various communities around the world.  She began to think “big picture” about the human rights implications of IP law.

To strengthen her understanding of those implications, Carpenter decided to pursue her LL.M. in international human rights at the National University of Ireland. She studied at a human rights center there, exploring the intersection of intellectual property and human rights. The Universal Declaration of Human Rights, as well as the UN International Covenant on Economic, Social, and Cultural Rights, provide that individuals should have claim to the moral and material interests of their own creations.

“I remember the first paper…I wrote [in Ireland] about the right to intellectual property. When I got my grade, I did okay, not so well,” Carpenter recalled. “I went to talk to the teacher about it, and she said, ‘Your paper was really good, but the problem is, that’s not a very important right.’ I have always thought back to that because it was the early 2000s, before we recognized that we live entirely in an intellectual property and content knowledge economy around the world. The irony of that strikes me now.”

Before she became the dean at UNH Franklin Pierce, Carpenter’s personal journey took her from earning a B.A. and M.A. in foreign languages (Spanish) at West Virginia University (near where she grew up) to her first stint in education. She taught Spanish, earned her JD, and contemplated a career that always seemed to be leading her back toward academia. As a high school student at The Madeira School in McLean, Va., Carpenter participated in a work program that introduced her to experiential education. Carpenter continued on that path as an undergraduate by teaching adult, mostly immigrant, ESL students, and was inspired by their work ethic and desire to create better lives for themselves.

Carpenter’s affinity for intellectual property law began to evolve during her time at Kirkpatrick & Lockhart in Pittsburgh. In working with the firm’s tech, multimedia, and entertainment law clients, Carpenter began to realize that many of a company’s assets were based in intellectual property.  She found the questions that arose with regard to branding and trademarks to be fascinating – and wanted to learn more. Her willingness to consider new areas of the law have been hallmarks of Carpenter’s career ever since.

“I always try to tell students now that you should go into something with intention,” she said. “You feel like you have an idea of what your passion is, and you should absolutely pursue that, but don’t hesitate to keep yourself open to those random things that happen, that send you down a different path you may not have expected.”

Carpenter returned to academia in West Virginia, where she taught intellectual property at the College of Law. She subsequently founded IP programs at Texas Wesleyan and Texas A&M. As her administrative responsibilities grew at Texas A&M, Carpenter began to think about her next career opportunity. She had long considered UNH Franklin Pierce as the benchmark for IP law, and jumped at the chance to continue her work in New Hampshire.

“As I built programs at different schools, I thought, ‘What is that magic thing that school has up in New Hampshire,” she said. “They produce top-quality grads who always keep the school as part of their identity. The opportunity to keep doing administrative work that I loved,  in a greater sense, at a school that for me had always been the gold standard for legal education was an opportunity I couldn’t pass up.”

In her tenure at UNH, Carpenter has overseen the founding of the innovative Hybrid JD Program, which increases access for students wishing to pursue a law degree, no matter where they are in their life or career. Especially in a post-pandemic world, she hopes the program will become a model for distance learning in legal education, including increased opportunities for international students to earn a law degree from a top American university. Carpenter also is looking to expand on programs that highlight experiential learning opportunities, similar to the 2020 Silicon Valley Experience.

“Being a dean, in so many ways through shared governance, [enables me to] help people accomplish their goals,” she said. “And that is something that is incredibly satisfying to me. The students are developing their legal networks and connections in a kind of experiential, on-the-ground way and relating that back to the classroom. I think legal education has an opportunity to change right now. And I look forward to being here at the law school to see that through.”

UNH Franklin Pierce is currently accepting applications for its Intellectual Property and Commerce and Technology LL.M., master’s, and certificate programs. For more information on the degrees offered and how to apply, please visit the law school’s website, email admissions@law.unh.edu, or contact +1-603-513-5300 by phone or WhatsApp.

Photo: Arne Müseler.www.arne-mueseler.com.hallo@arne-mueseler.com

Even as the pandemic situation continues to worsen in India, the Delhi High Court yesterday put out an order that hauled up the government on various issues regarding the response to the pandemic so far, oxygen use, ramping up of testing facilities, shortage of drugs and black market selling of them, bed shortages, wastage of 44 lakh vaccines(!) , etc. The 11 page order by the Division Bench, consisting of Justices Vipin Sanghi and Rekha Palli, was given in the case of Rakesh Malhotra vs Govt of National Capital Territory of India and Others, and is available here. It is worth a full read for a quick glimpse on the various issues that the country is facing right now.

Notably, the order also directed the Central Government to ramp up production of medicines for treatment of Covid, noting the various sections of the Patent Act which allow compulsory licence / governmental use of such inventions. Varsha and I have discussed some of these provisions earlier in our post “The Public Interest Defence, and the Public Interest Offence – What Is The Way Forward In This Pandemic?” and Prashant had addressed them in his post “The Need for an IP Policy to Build a Strategic Stockpile for Pandemics“. (And see also Anupriya’s three part series starting here, and Pankhuri’s post on Remdesivir shortage here)

I’m reproducing the two relevant paragraphs of the order that discuss this here below:

27. There are a number of other drugs which are being used for treatment Covid-19 patients, such as Tocilizumab, Favipiravir, Ivermectin, Dexamathasone, Methylprednisolone, Dalteparin, Enoxaparin, HCQ and Baricitinib. As per news reports, there are shortages of some, if not all, of the aforesaid drugs. Looking to the emergent situation, we direct the Central Government to immediately reach out to the manufacturers/ patent holders/ licensees so as to forthwith ramp up the production capacities of the above, and all such other medications, as are essential for treatment of Covid
positive patients. We may take note of the fact that the Patents Act provides for Compulsory Licenses under Section 84, and Special Provision for Compulsory Licenses or Notifications by the Central Government, under Section 92. Section 100 provides the power of the Central Government to use inventions for purposes of the Government.

28. Looking to the present day situation, there can be no doubt that a case is made out for exercise of its power by the Central Government/ Controller under the aforesaid provisions of law. At the same time, the interests of the Patent holders/ licensees should be kept in mind, since it on account of their investments, inventions and hard work that such like medicines are made available to the public at large. The best course would be encourage the existing manufacturers to ramp up their production on a war footing. They should also be encouraged to grant voluntary licenses to other entities to
manufacture the requisite drugs. However, if such efforts do not fructify soon enough, the Government/ Controller should not hesitate to invoke their jurisdiction and powers under the aforesaid provisions of the Patents Act, since the lives of thousands of people are being lost each day in the country due to COVID. The lives of the people take priority over everything else. Even if such like powers are exercised, the patent holders/ manufacturers can be adequately compensated by fixation of fair license fee. The Central Government should swing into action in terms of this order in this regard without any delay, and report progress on the next date of hearing.”

Will we see the government finally moving forward on this front? Let’s wait and see.

We’re pleased to inform you that DPIIT IPR Chair, NUJS is organising a  webinar on ‘IPR & SMEs (Special Focus on Agriculture & Food Sector): Strengthening Bonds in Prime Times’ on 25^th April, 2021. For further details, please see the announcement below:

National Webinar on ‘IPR& SMEs (Special focus on Agriculture & Food Sector): Strengthening Bonds in Prime Times’

25^th April 2021 | 4:00 PM – 6:00 PM (IST)

SMEs are the backbone of the global economy. They account for around 90 percent of all businesses worldwide and are essential contributors to job creation and economic development. When economic recovery from the fallout of COVID-19 is a priority, World IP Day 2021 shines a light on how SMEs can use their IP assets to build stronger, more competitive, and resilient businesses and create jobs. IP is a powerful tool for SMEs in all parts of the world to create economic value and advance their business goals.With IP rights, an idea can be turned into a business opportunity that generates value, creates employment, and enriches the market offering consumers a broader choice of new and better products and services.With IP, businesses create value and can do better, communities can thrive, and national economies can prosper.

This year’s World IP Day campaign maps key IP-related issues that come into play when taking ideas to the market. We explore the practical IP issues and challenges that will arise on that journey and how to manage them. We take a closer look at identifying, protecting, and leveraging IP assets for business growth, the business opportunities that can flow from IP licensing, and the range of options available to finance innovation.

World IP Day 2021 also highlights the central role that WIPO and national and regional IP offices worldwide play in creating a favourable landscape for SMEs to drive innovation and creativity, power economic recovery, and create employment.

Registration Details

• Last date of registration: 24^th April, 2021 (till 6:00 PM)
• Registration link: https://forms.gle/ddAnXfjH8jNLSS4R8
• Limited number of seats
• Before the day of the event, you will receive event joining link with password.

Introducing the Speakers

Dr. Sudhir Kochhar

Topic: Innovativeness holds the key agrarian progress

Dr. Sudhir Kochhar, ARS (Retd.): A 1977 batch ARS (ICAR) Cadre in Plant Breeding discipline, with diverse ‘research and coordination’ cumulative experience of ~45 years in Hill agriculture, forage production, under-utilized and under-exploited plants, plant genetic resources and IPR management; national coordination of consortia of basic and strategic research under the National Agricultural Innovation Project (NAIP), and AICRP (UU&UEP). An active germplasm explorer of bamboos and upland paddy in north-east India, wheat in Kumaon Himalaya, and jojoba in California and Arizona deserts, USA; and evaluator/ conserver of legume crops germplasm at NBPGR. Pioneering contributions include ‘Descriptors of Bamboos’ and development of post graduate curriculum in PGR discipline. Highly trained and widely travelled resource person, trainers’ trainer, and invited faculty in IPR/ agrobiodiversity/ PGR fields. Backstop contribution towards enactment or amendment of Indian PPV&FR, Biodiversity and Patent Acts, and Mauritian Plant and GMO Acts. Another key contribution is developing ICAR’s IPR guidelines. For a brief term, also headed the IPR Unit of ICAR in its foundation stage as Assistant Director General (IPR).

Dr. Kalpana Sastry Regulagedda

Topic: Dilemma of patenting or publishing

Dr. Kalpana Sastry is a distinguished Agricultural Scientist with nearly three decades of expertise in the areas of Agriculture Research, Technology Commercialization, Intellectual Property and Innovation Management, Entrepreneurship and Start-up ecosystem development in Agriculture. She joined the Agricultural Research Service under ICAR in 1984. As a trained Plant Pathologist, she was part of numerous projects under Government of India funded Technology Mission Programme on Oilseeds. In 1996, she joined as faculty in National Academy of Agricultural Research Management (NAARM) where she worked in various hierarchical roles. Her last assignment was as the Joint Director of the Academy. Her research areas include agricultural innovations, intellectual property management systems and policy issues in agricultural research and education management. She has been associated in several projects on needs and impact assessment of emerging technologies in agri-research and developmental schemes, projects, intellectual property and technology innovation, agri-entrepreneurship initiatives in the National and International Agricultural Research System. Further, she is closely associated in technology backstopping activities for a wide range of stakeholders including grassroots innovators, farmers, students, scientists, academia and entrepreneurs; she is engaged in IP informatics, technology management and in upscaling of innovations for agri-rural sectors for the last two decades. This experience formed part of her teaching and research work as faculty at Tata Institute of Social Sciences for a period of two and half years (2017 to 2020). Currently she is leading the team at AgHub Foundation, Centre for Innovation and Agri-entrepreneurship at Prof Jayashankar Telangana State Agriculture University, (PJTSAU), Hyderabad.

Dr. Sastry has been a recipient of several prestigious awards like Prof. M.G. Narasimham Award for best research paper oration; Indian Phytopathological Society Gold Medal; Smt. ChandabenMohanbhai Patel Vasvik Award for Best Women Scientists at the national level; the ICAR-AHRD fellowship by FAO; Occasional Lecture Award (OLP) Award under Fulbright Scholar Program, and The Fulbright Senior Research Fellowship at the international level.
Awarded for her post-graduation and PhD degrees by the prestigious Indian Agricultural Research Institute, she is also a PG Diploma holder in Patent Laws from National Academy of Legal Studies and Research (NALSAR), India.

Avinash Kumar

Topic: IPR licensing in S&T: Life sciences

Mr. Avinash superannuated from the position of Associate Director (IPR), Sc ‘G’, Directorate of ER & IPR, Defence Research & Development Organisation, New Delhi on 31 December, 2019. At DRDO HQ, He was involved in handling entire range of IPR related issues including providing legal protection on innovations made by DRDO scientists by drafting, filing and handling prosecution of patent applications in the area of electronics, mechanical engineering, chemical technologies etc. apart from crafting IPR related provisions in Collaborative R&D Agreements between DRDO and various institutions/industry etc. He has an experience of about 22 years in the area of IPR and also played major role in evolution of IPR culture in DRDO. His consistent efforts and various innovations have contributed in DRDO winning the prestigious National Intellectual Property Award 2015 in the category “Top R&D Organisations for Patents”. He was involved in implementing DRDO IPR Policy in 2016 in addition to implementing uniform IPR Policy for various schemes such as Grants-in-Aid, Contract Research, Centres of Excellence, Technology Development Fund etc. He has delivered more than 50 invited talks in seminar/workshops organised by DST, NRDC, DAE, IITs, CII, various Universities and R&D Organisations He has also worked as Member of CII National Committee on IP, Member, Advisory Committee on IPR for DST-Centre for Policy Research Chandigarh. Currently, He is The Chairman, IPR Committee of National Research & Development Corporation and Member PFC-TIFAC Committee on IP Filing. Prior to joining at DRDO HQ, he worked as Examiner of Patents & Designs at Patent Office Delhi, as Asstt. Engineer at HAL, Korwa Division and as Scientist in a DRDO lab at IRDE, Dehradun. He did M.Sc in Physics from BHU, Varanasi &M.Tech in Applied Optics from IIT, Delhi.

Dr. Sudhir Kumar Soam

Topic: Agricultural GIs in India: Role of research organizations in protection and product development

Mr. Sudhir is currently the Head of the Information & Communication Management at National Academy of Agricultural Research Management.

Moderator of the Event

Dr. Pinaki Ghosh, DPIIT IPR Chair, WBNUJS

Dr. Pinaki Ghosh is a senior advisor at KPMG, India. Dr. Ghosh was a researcher the 1st half (1997 to 2002) in GE and filed 26 patents and 20 papers in. Before GE, he had a stint at DRDO missile division, Hyderabad immediately after his Masters in Mathematics from IIT KGP and Ph.D in ‘Image Processing’ from ISI Calcutta. He used to regularly visit National Law School of India University, Bangalore and RGSOIPL, IIT Kharagpur to conduct lectures on IPR. He is also a member of the CII National Committee on Technology and IPR and National Committee of Intellectual Property Owners. He is the core committee member of IP of CII, FICCI and ASSOCHAM. Currently, he is pursuing his 2nd Ph. D in Law.

(Long post ahead)

Three vials of a Covid-19 vaccine with a syringe beside them (image from here)

On 23rd April, Ned Price, a spokesperson for the US State Department, revealed that the Biden administration is not considering lifting the export bans on the necessary raw materials for the COVID-19 vaccine. This refusal comes in response to the requests (see here and here) made by the SII CEO Adar Poonawalla to get rid of the export bans and assist in ramping up the outputs of vaccines in the global market. (Side note:  Back in Feb, Poonawala requested other nations to be “patient” as SII has been directed to prioritize the huge needs of India). 

Export bans: displaying vaccine nationalism in tougher times

The reason for this refusal stems from the protectionist stance the USA has maintained since the outset of the pandemic. A few of the USA’s tactics in the past include the export restriction on distribution of necessary protective equipment, hoarding medicines based on unsubstantiated rumors, and threatening others with retaliation on doing the same, signing the most pre-purchase agreements with vaccine manufacturers, etc. Price’s refusal resonates with that “America First” sentiment, where he expressly says that “It is not only in the U.S. interest to see Americans vaccinated, but it is in the interests of the rest of the world to see Americans vaccinated.” (Whatever about no one is safe, till everyone is safe, eh?)

However, the bizarre stance of the White House sharing Astrazeneca doses with Mexico and Canada while simultaneously blocking the export of necessary raw materials to India, hindering the latter’s vaccine output, puts up a big question mark on its vaccine policy.   

Regardless, the USA is not the only nation that has imposed an export ban on vaccines or related commodities. Recently, the EU has imposed a de facto export ban on vaccines. India, too, has reportedly reduced its export of vaccines. This trend of imposing export bans on necessary products for COVID-19 treatment is an unfortunate continuation from last year. In April last year, WTO had cautioned nations against imposing export restrictions. Despite that, the spree to impose export bans continued. (see here and here).

Image from here

Are these Export Bans valid?

(Short version: Possibly so. International law folks may be interested in this portion; others may be interested in moving straight on to the next heading) 

The rule as under Article XI:1 GATT says that any prohibition on export or sale for export to other Member countries is “generally” prohibited. As the name suggests, ‘export bans’ are prohibitions on export and thus fall within the ambit of the above provision.  However, in certain situations, these export bans can be imposed by a Member. For instance:-

1. Article XI:2 permits any prohibition imposed temporarily to prevent or relieve critical shortages of other products essential to the exporting country. 

In the present case, the ban has been ‘temporarily’ imposed to ‘prevent’ critical shortage of an ‘essential product,’ i.e., the raw materials for vaccines. We should rely on the Panel Report and the Appellate Body Report in China-Raw Materials for interpretation of the clause. The Appellate Body held that “temporary” doesn’t mean that the member should give an explicit time limit, but rather the measure must be applied to “bridge a passing need.” (para 323). In the present case, the US may argue that the export ban  was imposed to bridge the need for COVID-19 vaccines in its territory and thus justify it to be “temporary”. The Panel under para 7.306 held that if the product is ‘essential’ or not, the member must see the particular circumstances faced by it when it applies the restrictions. Thus, the burden of proof to determine whether the product is essential or not lies on the USA itself, considering its circumstances. Furthermore, the Panel also ruled that such measures can be imposed preemptively and do not require the shortage actually to take place. (para 7.294)

2. Article XX (b) permits Members to impose any measures necessary to protect human, animal, or plant life or health. 

However, this exception must fulfill the “Chapeau requirement” of Article XX, which states the measure must be applied in a manner that doesn’t discriminate between the Members in an arbitrary and unjustified manner or is disguised as a restriction. The US should not have any problem in defending the decision for export bans under Article XX (b) as it was made to protect human lives from the clutches of the ongoing pandemic. 

Unlike Article XI:2, As explained by Artheya here, Article XX(b) doesn’t apply in a narrow sense, i.e., it doesn’t concern itself with the nature of the product, nor is it just applied during an impending crisis. Rather, Article XX(b) justifies a measure which is necessary to fulfill a policy undertaken by the measure imposing Members in further to protect human health or lives. (See Appellate Body report in Brazil-Retreaded Tires (Para. 156).

3. Article XXI (b) (iii) permits a Member to take any actions which it considers necessary for the protection of its essential security interest during other emergencies in international relations. 

This is perhaps the most interesting exception available in defense of the export bans. This provision which was generally seen as an exception to defend actions undertaken during war-like situations is now gaining traction to justify restrictions imposed by countries during the pandemic too. A plethora of scholars have argued that COVID-19 is an emergency in international relations (see here for arguments by JB Heath and here for arguments by Henning Grosse Ruse-Khan, and here for our coverage of the argument by Shirin Syed). Thus, in arguendo, it can be said that the export ban by the US can be justified under Article XXI. 

Considering the above, it is safe to assume that a theoretical argument can be made justifying the US’s export bans. 

Implications of the Export Bans on Vaccine Supplies

These export restrictions can have a disastrous impact on the supply of COVID vaccines globally. Contrary to the principle of “Atma Nirbharta,” in reality, no country or industry is self-sufficient. The same is the case with the vaccine manufacturers, who rely extensively on different sources/ entities for different functions. 

Image from here

When restrictions like export bans are imposed, the whole supply chain of the product disrupts. Simon J. Evenett (See Chapter 3 here)  explains that the supply chain functions on the basis of the “O ring theory” (see here for a primer). If a malfunction happens in even a small part of the whole supply chain, it can have a huge impact on the ultimate outcome, much like the Challenger Space Shuttle accident, which occurred due to a fault in a simple gasket or “O ring.” 

In the past as well, aftereffects of such export restrictions have been observed by the world. As highlighted by Nadia Rocha (here), back in the early 2000s, few exporting Members imposed export restrictions on agricultural commodities, which led other Members to impose similar restrictions owing to a gradual shortage in supply. This chain of export restrictions led to a ‘multiplier’s effect’ whereby Members ended up contributing to the existing shortage. Rocha prophesied that similar should be the fate of the world (or maybe worse) if the Members continued with the present trajectory of export restrictions on medical items in the wake of COVID during her interview for the trade talks podcast. Similar arguments were advanced by Prashant Yadav, especially with regard to the export restrictions on the supply of COVID-19 vaccines here. 

These arguments are translating into reality with every passing day. In March 2021, COVAX blamed India for its inability to supply the poor with vaccines. In April, it asserted that SII is obligated to supply it with the Oxford-Astrazeneca vaccines. Initially, COVAX expected to receive more than 100 million doses of the vaccine from SII but ended up receiving only 18.2 Million doses. SII, on the other hand, blamed the US Government for not supplying it with necessary raw materials and requested it for lifting the export bans. 

Looking at the (in) effectivity of TRIPS Waiver from the lens of Export Bans

With this established that the international trade regime permits the Members to impose quantitative restrictions, where does it leave the argument to waive TRIPS and facilitate access to medicines? The primary argument which is advanced in support of the waiver is the consequential rise in the number of manufacturers who can produce the COVID-19 treatment without worrying about IP enforcement. However, as pointed out by Prashant here and Christopher Garrison here, it is tough to reverse engineer and make complicated biologics like the COVID-19 vaccine unless undisclosed information (knowhow) and necessary technology to manufacture such vaccines are shared with the manufacturers. Unfortunately, the waiver can do only so much about it. 

Looking at the scheme of WTO, for a decision concerning the waiver from the obligations arising out of TRIPS, the same must be passed by a three-fourth majority (Article XI:3 of the Marrakesh Agreement). As reported by TWN,  presently the proposal is supported by two-thirds of the members.

However,  even if passed, the waiver may face turbulence in functioning, and the opponents may continue to create hurdles in its operation. Apart from not sharing know-how and technology, the opponents to the waiver may continue to impose export restrictions and tamper with the supply chains. In such a situation, I am not sure if waiving TRIPS will be sufficient to resolve this barrier. In fact, the waiver might end up being ineffective. As a consequence of the waiver, the number of COVID vaccine manufacturers will increase inadvertently. If the export bans persist, then these new manufacturers may not have raw materials to work on and thus defeating the purpose of amplifying vaccine growth throughout the existence of the waiver.  

Conversely, the proposed TRIPS waiver nowhere suggests that the products generated from the waiver shall not be subjected to export restrictions themselves. Readers may recall that last year when it was rumored that hydroxychloroquine might be efficient in curing COVID-19, India (one of the proposers of the TRIPS waiver) in a knee-jerk reaction, was first to impose a ban on the export of the drug without any shortage of the same. Unknowingly risking the fight against malaria in countries where it is still seen as a problem. 

Thus, the liberty at which the WTO Members may and have been imposing export bans highlights how the Waiver alone might not be sufficient in ensuring universal access to treatment for COVID. 

The way out? 

The very first thing which the Members must realize is that the pandemic knows no boundaries.  In this vein, initiatives targeted to improve the technology transfer and access to knowhow like the new  COVID-19 mRNA vaccine technology transfer hub need to be supported, and perhaps new life should be given to CTAP as well. Similarly, emphasis shall be given to the negotiations aimed at strengthening the local production of medicines, especially with the support of government funding. 

If we ever get to talking about amending the WTO agreements, then necessary amendments seeking restrictions on imposing absolute export bans can be introduced in the GATT. Or maybe something more ambitious like complete restriction on using justifications under Article XI:2, XX(b) and XXI, during pressing times, as suggested by Prof. James Gathii et.al. Most importantly, the waiver must also include a clause stating that the Members shall not apply any export restrictions on the products generated out of the TRIPS waiver and should have mechanisms to differentiate such products, much like the Article 31bis products. 

What seems like the immediate solution to this curveball thrown by the USA, India had decided to waive custom duties to improve imports of vaccines and its raw materials for three months.  However, this measure will be of no use if the exporting country decides to impose its own version of the export ban on these commodities. Thus, apart from adopting feasible lucrative interim measures, India should accept help from its neighbors and friendly countries (China, Australia, France) and keep the differences at bay. 

Topical Highlight

Image from here

Compulsory License for Covid Drugs on the Table, Says Delhi High Court

In this post, Swaraj discusses the recent Delhi High Court order in the case of Rakesh Malhotra v. Govt of National Capital Territory of India and Others, in light of the worsening pandemic situation in India. The Court hauled up the government on various issues regarding the response to the pandemic so far, concerning oxygen use, ramping up of testing facilities, shortage of drugs and black market selling of them, bed shortages, wastage of 44 lakh vaccines(!), etc. Swaraj notes that crucially, the order directed the Central Government to ramp up production of medicines for treatment of Covid, noting the various sections of the Patent Act which allow compulsory licence / governmental use of such inventions. Quoting from the order, he highlighted the Court’s salient observations, “the best course would be to encourage the existing manufacturers to ramp up their production on a war footing. They should also be encouraged to grant voluntary licenses to other entities to manufacture the requisite drugs. However, if such efforts do not fructify soon enough, the Government/ Controller should not hesitate to invoke their jurisdiction and powers under the aforesaid provisions of the Patents Act, since the lives of thousands of people are being lost each day in the country due to COVID.”

Thematic Highlight

Image from here

A Recipe for Disaster: Export Bans, TRIPS Waiver and Hyper Nationalism

In this detailed post, Praharsh discusses the US’ stance of sharing Astrazeneca doses with Mexico and Canada while simultaneously blocking the export of necessary raw materials to India, hindering the latter’s vaccine output. He locates this within the larger context of export bans on vaccine raw materials and its implications on vaccine supply chains along with the potential benefits (and shortcomings) of a TRIPS waiver. He notes that the GATT restricts any prohibition on exports generally. However, there are exceptions to this general prohibition and Praharsh highlights that a theoretical argument can be made justifying the US’s export bans. He notes, as has been pointed out by other commentators before, that it is tough to reverse engineer and make complicated biologics like the COVID-19 vaccine unless undisclosed information (knowhow) and necessary technology to manufacture such vaccines are shared with the manufacturers. A TRIPS waiver can do only so much about it. He offers some suggestions such as extending support to initiatives targeted to improve the technology transfer and access to knowhow like the new COVID-19 mRNA vaccine technology transfer hub, and giving a new life to CTAP as well as emphasising the negotiations aimed at strengthening local production of medicines, especially with the support of government funding. One of his more ambitious recommendations concerned amending the WTO agreements to completely restrict export bans during pressing times. He concludes that what seems like an immediate solution is India’s decision to waive custom duties to improve imports of vaccines and its raw materials for three months.  However, he notes that this measure will be futile if the exporting country decides to impose its own version of the export ban on these commodities.

Other Posts

Image from here

Infographic on ‘Permissible Uses of Copyrighted Books in India’ on World Book and Copyright Day

On the occasion of the World Book and Copyright Day, we shared an infographic by Pankhuri Agarwal on all our social media pages highlighting the ‘Permissible Uses of Copyrighted Books in India’ as per fair use of copyrighted books provided for under Section 52 of India’s Copyright Act. We shared this in the hopes of making users more confident of exercising their user rights relating to books without hesitation or reluctance. The Infographic in Word Version is available here.

Seeing It Through: The Journey of the Dean of UNH Franklin Pierce School of Law

We also brought a guest post to our readers by UNH Franklin Pierce School of Law, sharing a glimpse of the educational and professional journey of its dean Megan Carpenter and what she views as the future of UNH Franklin Pierce’s law programs. Dean Megan Carpenter has relished the chance to build on UNH Franklin Pierce’s innovative programs in IP law and more about her insightful and inspiring journey can be found in the post.

NUJS Webinar on ‘IPR& SMEs (Special Focus on Agriculture & Food Sector): Strengthening Bonds in Prime Times’ (April 25)

We informed our readers about a webinar on ‘IPR & SMEs (Special Focus on Agriculture & Food Sector): Strengthening Bonds in Prime Times’ organised by the DPIIT IPR Chair, on 25th April, 2021. When economic recovery from the fallout of COVID-19 is a priority, World IP Day 2021 shines a light on how SMEs can use their IP assets to build stronger, more competitive, and resilient businesses and create jobs. Further details regarding the event were provided in the announcement in the post.

Decisions from Indian Courts

• The Kerala High Court in Kunhi Muhammed Etayattil v. Assistant Registrar of Companies, held that the Registrar of Companies was not justified in declining the incorporation of “Reef Wellness & Excellence LLP” on the ground that the proposed name includes the word ‘Reef’, which is a trademark under class 5.
  The Court held that this amounted to a rejection without application of mind wherein the government officials blindly depended on the Central Registration System of Ministry of Corporate Affairs. [April 24, 2021]
• The Delhi High Court in Sagar Ratna Restaurants Pvt. Ltd. v. D S Foods & Ors. set aside the impugned order holding that the respondents could not be allowed to take inconsistent positions as per their convenience regarding the arbitrability of a dispute arising out of the franchise agreement wherein they were granted a license by the petitioner, who is a registered owner of the trade mark Sagar Ratna, to use their mark “SAGAR RATNA”. [April 22, 2021]
• The Bombay High Court in Prateek Chandragupt Goyal v. State of Maharashtra quashed an FIR lodged against Newslaundry journalist, Prateek Goyal by the Sakal Media Group for allegedly committing offences under the Trademarks Act, holding that the mere use of the registered trade mark in articles authored by the petitioner did not amount to false application of the trade mark. [April 20, 2021]
• The Telangana High Court in G.S.K. Life Sciences Pvt v. The Union of India held that the 2nd respondent rightly passed orders directing the petitioner to change their name by deleting the word ‘GSK’ from it since it is similar to the 3rd respondent’s name, and 3rd respondent is widely known as GSK for a long time even prior to the incorporation of the petitioner-company. [April 20, 2021]
• The Delhi High Court in Mankind Pharma Ltd. v. Novakind Bio Sciences Pvt. Ltd., held that since the suffix “KIND” was common to all the plaintiff’s products, it had attained distinctiveness within the meaning of Section 17(2) (b) and Section 32 of the Trademarks Act, 1999. Thus, defendant’s use of it for its pharmaceutical products was restrained till the next date of hearing as it could confuse or deceive the public into believing the products of the defendants to be those of the plaintiff. Notice was served on the defendants and they were directed to file a response to the application within 2 weeks of the date of the order. [April 20, 2021]
• The Delhi High Court in Best Power Equipments India Pvt. Ltd. v. North East Computer Traders, refused to grant an ad interim injunction against the defendants on an allegation concerning disparagement of the plaintiff’s trade mark. The Court held that the impugned private WhatsApp messages merely stated that as there were complaints against some of the UPSs supplied by the plaintiff, traders were required to be cautious while dealing with the plaintiff. Thus, the Court concluded that it would not be correct at least at an ad interim stage to restrain the defendants from exchanging WhatsApp messages amongst themselves which may, according to the plaintiff, disparage the plaintiff or its products. [April 20, 2021]
• The Delhi High Court refused to grant an interim injunction on a plea by Bengaluru-based payments firm PhonePe against rival BharatPe on using the ‘Pe’ suffix, holding that there was insufficient evidence to conclusively determine that the ‘Pe’ suffix would be “indelibly associated” by the public with PhonePe’s services. [April 15, 2021]
• The Delhi High Court issued notice on a petition by late Bollywood actor, Sushant Singh Rajput’s father, seeking a ban on the release of any movie on the actor’s life. Sushant’s father argued that any use/misuse of Sushant’s name/image/caricature/ lifestyle or information from his personal life amounts to infringement of his “personality right” amounting to passing off.

News from India

• Seven companies producing Remdesivir in India voluntarily slashed prices by an average of 39% as the use of the drug shot up due to a surge in Covid-19 infections, upon government intervention.
• The Congress Party’s 14-point statement regarding the government’s ‘grave errors’ in Covid-19 management emphasised the failure of the government to resort to compulsory licensing to produce the two approved vaccines in other pharma manufacturing facilities in India.
• An article in the Times of India reported that during a meeting of the TRIPS Council, while discussing India and South Africa’s joint proposal for flexibility in the patent regime to facilitate access to vaccines in developing countries, the Indian delegation emphasised that the existing approach of voluntary licencing could only deliver vaccines to 4% of the global population.
• On World Intellectual Property Day 2021, the Indian Performing Right Society Limited launched the ‘IPRS for Fair Music’ campaign to boost a healthy ecosystem for music in India.

Other News from Around the World

• An Australian scientist who claimed to have created Bitcoin was backed by London’s High Court to sue the mystery owners of the bitcoin.org website for allegedly infringing his copyright over the cryptocurrency.
• An article in the Livemint by Lalit K Jha reported that the Biden administration experienced immense pressure from various quarters, including the powerful US Chambers of Commerce, lawmakers and eminent Indian-Americans, to export AstraZeneca and other Covid-19 vaccines along with several life-saving medical supplies to India.
• An article in the Economic Times reported that in an effort to re-establish “authority” over the usage of her likeness, model, actress and writer Emily Ratajkowski, is minting a nonfungible token. Since an NFT is less about the image itself and more about ownership over a digital file, Ratajkowski realized the medium could be an effective tool to make a statement about ownership — by appropriating the appropriation of her photos.

A book with ‘Doctrine of Fair Use’ inscribed on its cover and kept beside a gavel and a pair of glasses (image from here)

On the occasion of the World IP Day, pleased to bring to you the initial installment of a compilation of all the fair use decisions pronounced by India’s high courts and the Supreme Court under the Copyright Act, 1957 till date. The pdf version can be viewed here and the word version here.

The compilation lists all types of use of copyrighted works which the courts have determined to be permissible – or not permissible – under Section 52 of the Act. The compilation also lists the relevant legal provisions, case details and the main points of court’s reasoning in respect of each type of use. This initial installment compiles the decisions relating to education and research. Within this category, the cases have been arranged according to the broad type of use, such as course packs, guide books, question papers etc.

Huge thanks to Bhavik Shukla (a former long-term intern at the blog, who’s now an Associate at Khaitan & Co.) for helping compile this list!

Hope that the readers find this resource useful. We’ll include it on our Resources section (here) as well soon, so that it can be easily accessed from there at anytime. We’ll also keep updating the list periodically.

While we’ve have tried to create an exhaustive list, please let us know if we have missed out any cases and we’ll add them to the list. Hope to bring to you the entire compilation soon!

Also, we’ve uploaded on the website the infographic on fair use of copyrighted books in India (listing the various ways in which copyrighted books can be used without the copyright owner’s permission under section 52) that we’d shared on social media on the occasion of the World Book & Copyright Day last week. The pdf version can be viewed here and the word version here.

Stay safe!