We are pleased to inform you that a leading mid-size law firm in Mumbai is looking to immediately hire a media lawyer for the position of a Senior Associate. For further details, please read the job description below:

Position:

Senior Associate – Media Law

Responsibilities:

The candidate must have transactional experience in music industry and digital media. He/she must have extensive experience in media and entertainment related transactions including in relation to copyright in music, music publishing issues, content production and syndication, live events, artist management, due diligence of content acquisition, brand endorsements etc.

Desired Joining Date:  

Within 1 month

Desired Qualification & Experience:

• LL.B degree
• Minimum 5 years of experience in media and entertainment practice.

 How to apply:

Interested candidates may send their application along with their CV to mumbailawfirm1@gmail.com.

Last week, I was in for a bit of a shock! Spotted this piece on SSRN that touts the idea of an “investment protection regime” for new inventions.

I’d mooted the very same idea (an investment protection regime for inventions) in my PhD thesis more than 8 years ago. This was later published (around 6 years ago) in the Journal of World IP,  as below:

Shamnad Basheer, “The Invention of an Investment Incentive for Pharmaceutical Innovation”, 15 Journal of World Intellectual Property 1 (2012).  

I’d put up a copy of the piece on SSRN as well. Also my PhD thesis itself was uploaded on the Oxford database of theses. 

Apart from this, I’d also cited the investment protection model in later articles of mine (which I’ve listed in an addendum below this post). Several blog postings on SpicyIP also referred to this model. 

And yet this recently released piece titled “Recoupment Patent” (authored by 3 academics from Universities in Israel) makes no reference at all to my piece and its central idea of an investment protection regime. Rather, it goes on to tout this “recoupment” of investment as a “novel” idea. Here is what the recoupment authors state:

“Under this new model, the patentee must prove the level of investment in each invention, and the duration of the patent will depend on that level of investment. This will establish a time frame to recoup investment and earn some level of profit.”

Compare this with what I had stated (as the central thesis) in my piece:

“…patents offer a uniform period of protection to all inventions, without regard to the actual investment per drug or its consequent social value.

1. “Alternative Incentives for Pharmaceutical Innovation“, 27 Intellectual Property Journal 13 (2014).
2. “The End of Exclusivity: Towards a Compensatory Patent Commons”, 58 IDEA 229 (2018).

Rishabh recently wrote a post on a Bombay HC Order. In the order, the Court has instructed the Defendant to give prior notice of 7 days to the Plaintiff before  initiating any legal proceedings against them regarding the trademark ‘Hotel Millennium Park’. He analyses the scope of Section 142 of the Trade Marks Act and concludes that the order is outside the ambit of the Section since it prevents the Defendant from obtaining ex parte ad interim reliefs.

Prof. Basheer called attention to a quite disappointing trend in the world of academia: the lack of proper attribution to works of Indian scholars. Eight years ago, Prof. Basheer had devised the idea of an investment protection regime for inventions in his PhD thesis and later went on to publish the same in the Journal of World IP. He recently, however, discovered another paper on SSRN which mooted the same idea without citing his work. In the end, he promises us another post deliberating on the politics of citations and scholarships.

SpicyIP Jobs

Pankhuri announced that a leading Mumbai-based, mid-size law firm is looking to hire a media lawyer for the position of a Senior Associate.

Other Developments

Indian

Judgments

M/s. Super Cassettes Industries Private Limited v. Brij Network/ Brij News – Delhi District Court [November 12, 2018]

The Court granted an ex parte permanent injunction restraining the Defendant from broadcasting Plaintiff’s copyrighted musical and audio visual works through its cable network without license. In arriving at this decision, the Court stated that continuous infringement by the Defendant had caused substantial loss and damage to the Plaintiff’s business which was predominantly dependent on license income. Moreover, the Court awarded punitive damages of Rupees 20 lakhs in favour of the Plaintiff.

M/s. Super Cassettes Industries Private Limited v. M/s. World View Cable Services – Delhi District Court [November 15, 2018]

The Court granted an ex parte permanent injunction restraining the Defendant from broadcasting Plaintiff’s copyrighted musical and audio visual works through its cable network without license. In arriving at this decision, the Court stated that continuous infringement by the Defendant had caused substantial loss and damage to the Plaintiff’s business which was predominantly dependent on license income. Moreover, the Court awarded punitive damages of Rupees 15 lakhs in favour of the Plaintiff.

News

• Posting India vs Sri Lanka ODI video on Facebook lands fan in copyright row
• Civil Society Letter to Indian Minister of Commerce & Industry Suresh Prabhu, RE: RCEP and Access to Medicines
• Delhi Court Awards T-Series Rs. 40 Lakh In Copyright Infringement Cases
• HC restrains magazine from using ‘Aaj Tak’ trademark
• Simmba in trouble: Bevarage company claims trademark infringement

International

• Facebook Filed a Patent to Analyze Who You Live With
• Japan, South Korea’s push towards TRIPS-plus regime poses danger to cheaper drugs in India
• Pfizer loses drug patent fight in UK top court, may face claims
• Food taste ‘not protected by copyright’ rules EU court
• The Weeknd Sued for Trademark Infringement Over ‘Starboy’ Comic Book

One of These Days These Boots Are Gonna Walk All Over You (Image From Wikimedia Commons)

In my previous post, I broke down Ms. Justice Prathiba Singh’s recent judgement in Christian Louboutin v Nakul Bajaj, and noted its importance for intermediary liability and e-commerce players in India. In this post, I examine the Court’s approach towards intermediary liability, and attempt to outline what exactly the judgement means for e-commerce platforms. (Update: On November 12, the Court also made a similar ruling on similar facts in L’oreal v Brandworld, relying upon its earlier judgement in Christian Louboutin.)

(Long Post Ahead!)

The Court’s indictment of the defendant was based upon a factual analysis of the role played by the platform vis-à-vis the alleged infringement. The Court’s analysis considered the following questions:

1. When can an e-commerce platform claim to be an ‘intermediary’ under the IT Act?
2. When can an intermediary claim immunity from liability under Section 79 of the IT Act?
3. What is the relationship between infringement under the Trademarks Act and the immunity claimed under Section 79 of the IT Act?

While these are three distinct questions, all of which are relevant to the issue of determining a platform’s liability, the Court’s analysis does not make a clear distinction between the three issues, and consequently, ruling throws up more uncertainty than clarity on the issues. Let’s examine in detail.

1. When is an ‘e-commerce’ platform an ‘intermediary’?

The definition of ‘intermediary’ is provided under Section 2(w) of the IT Act, which states that an intermediary, for the purposes of any electronic record, means “any person who on behalf of another person receives, stores or transmits that record or provides any service with respect to that record and includes telecom service providers, network service providers, internet service providers, web – hosting service providers, search engines, online payment sites, online – auction sites, online – marketplaces and cyber cafes.”

The definition makes two things apparent –

1. It is meant to apply only as far as the services of the actor are related to an ‘electronic record’.
2. The definition is inclusive and broad and covers all manner of services in respect of an electronic record.

With respect to this issue, the Court correctly observes that e-commerce is a broad category that encompasses a range of actors, from those providing an platform for sellers to upload their content without modification (for example, Olx) to those that also select the sellers, offer transportation and packaging, etc. The Court illustrates 21 activities which could determine whether an e-commerce platform is an intermediary or not, which includes everything from ‘giving discounts to customers’, ‘employing delivery personnel’, ‘using trademarks as meta-tags’, or ‘deep-linking’. Further, the Court also takes into account whether a particular platform is taking measures to combat unlawful activities on its platform. As per the Court, when the business of an e-commerce platform includes a ‘large number’ of the factors enumerated by it, it would cross the line from an ‘intermediary’ to an ‘active participant’.

The Court applied these factors to the defendant’s business and its policies to determine that it is ‘much more than an intermediary’. However, there no clear rationale behind the inclusion of the various ‘factors’ in this analysis, apart from that most intermediaries engage in one or the other of such acts (such as creation of listing of a product).

2. When can an intermediary claim safe harbour under Section 79?

Section 79(1) of the IT Act states that an intermediary shall not be liable for any third-party information made available by it. This broad exemption is qualified by a number of factors. These include that the intermediary must not initiate, select or otherwise modify the communication; that it must observe due diligence while following its duties under the act, and observe government guidelines in this respect. Moreover, the exemption does not apply if the intermediary has “conspired or abetted or aided or induced” the commission of the unlawful act.

The Court’s analysis for Section 79 flows from its analysis of what constitutes an intermediary. The Court states that the factors enumerated would also indicate whether an intermediary is ‘conspiring, abetting, aiding or inducing’ the unlawful conduct, and is not an intermediary and is not entitled to protection under Section 79.

Further, the Court examines the responsibilities of intermediaries under Section 79 and the Intermediary Guidelines Rules, and states that the requirement of ‘due diligence’ is much broader than merely following the guidelines prescribed, and that merely following the guidelines cannot absolve intermediaries of their broader responsibilities. It is unclear from the judgement whether this implies that an assessment of ‘due diligence’ under Section 79 goes beyond observance of the rules and is a case-by-case assessment.

3. Determining trademark infringement by an e-commerce marketplace

The final part of the Court’s analysis rests on examining the actual provisions under the Trademark Act, for which the defendant could be held liable. The Court examines the defendant’s liability under Sections 101 and 102 of the Trademarks Act, dealing with applying, falsifying and falsely applying trademarks, and Section 2(2)(c) of the Act which defines ‘use’ of a mark. The Court states that services of an e-commerce operator which uses, falsifies or falsely applies a mark in respect of counterfeit goods, may be said to be ‘aiding, abetting, inducing or conspiring’ in the commission of an unlawful act.

The Court provides the following illustration –

“any online market place or e-commerce website, which allows storing of counterfeit goods, would be falsifying the mark. Any service provider, who uses the mark in an invoice thereby giving the impression that the counterfeit product is a genuine product, is also falsifying the mark. Displaying advertisements of the mark on the website so as to promote counterfeit products would constitute falsification. Enclosing a counterfeit product with its own packaging and selling the same or offering for sale would also amount to falsification. All these acts would aid the infringement or falsification and would therefore bring the e-commerce platform or online market place outside the exemption provided under Section 79 of the IT Act.”

Finally, the Court decrees the suit against the defendant observing that, given the sellers were all located on foreign shores, the trademark owner must not be left ‘remediless’ by extending safe harbour of intermediaries to ‘active participants’.

The Court’s final decree does not find the intermediary liable for infringement, but effectively issues an injunction against the defendant, stating that it must obtain the authorization of the rights holder if the sellers are foreigners and must offer a guarantee to the purchasers in case of domestic sellers. Further, the Court ordains a ‘notice and notice’ requirement which states that the intermediary must, upon receiving notice of an infringing product being sold on its platform, notify the sellers, and if it assesses that the seller’s evidence of the authenticity of the product is not sufficient, must take down the listing.

Where does this leave intermediary liability for trademark infringement?

While this is the first final judgement on trial on an issue of intermediary liability for trademark infringement, the judgement does little to actually clarify the scope of intermediary safe harbour and its relationship with the trademarks act.

Not all platforms can claim to be an ‘intermediary’

Firstly, the judgement does not make a clear distinction between ‘intermediary’ as those defined under Section 2(w) of the IT Act and those which may claim the safe harbour provisions under Section 79. The intermediaries classified under Section 79 are a subset of all intermediaries contemplated under Section 2(w) of the IT Act, but it cannot be said that by reason of not being entitled to safe harbour under Section 79, that a service provider ceases to be an intermediary, at least with respect to the various other obligations it has under the IT Act.

The judgement is also unclear on the applicability of Section 79 or the IT Act to the facts under consideration, when it illustrates the various factors for determining if an e-commerce player is an ‘intermediary’. The IT Act would only apply to online aspects of the platform’s operation, insofar as it applies to an ‘electronic record’ and ‘on behalf of another person’, while the status of ‘intermediary’ cannot be claimed for its other operations. Therefore, the whole of the Act and any protections offered under Section 79 would only apply to actions which take place online and through the digital platform, and not other acts like providing deliveries or packaging services. Ideally, the analysis should have separated the online elements of e-commerce operations from the other aspects, and assessed the liability for each of these separately. Instead, the Court provides a vague list of ‘factors’ to be assessed to determine if a platform is an ‘intermediary’ under Section 79, although this should only be applicable to the online aspects of the infringement claim. All other aspects should be dealt with under the regular provisions of the Trademarks Act. The factors enumerated by the Court to determine whether a platform is an intermediary would be helpful to the extent they can differentiate between the online and offline aspects of an e-commerce business, but are not helpful in classifying whether the platform is an intermediary or not.

No Clarity on Primary or Secondary Liability of Online Marketplaces

Secondly, the basis on which liability is sought to accrue to the defendant in this case is unclear. It is crucial to note that there was no finding of direct or indirect infringement in the ruling. While the suit was filed claiming that counterfeit goods are being sold on the platform, there was no actual sale that took place on the platform. Therefore, there was no determination whether the goods were in fact genuine or not, and the case merely proceeded on the assumption that the goods were counterfeit, with neither party providing sufficient proof of the goods’ authenticity.

This is problematic, as if the goods are in fact genuine products merely being resold, the issue at hand is of applying the principle of national or international exhaustion of trademark rights to determine the liability of the resale of the product. The Court did not go into this issue at all, even though it would appear to be central to the claims of sale of online goods, given the business model of the defendant.

The Court bypasses this issue and choses to determine the liability for ‘use of the mark’, the requirement for infringement under Section 29. While it finds that a number of the activities of the platform would amount to ‘use’ and even ‘falsifying’ a trademark, the Court also specifically finds that such use would not amount to infringement in case of genuine products. Subsequently, however, the Court appears to liken all these cases of ‘use’ in respect of non-genuine products as ‘aiding’ of an unlawful act, and thereby robbing any intermediary of exemption from liability under Section 79. Yet, the issue of aiding, abetting or conspiring implies a level of knowledge of the infringing act. The Court does not examine the issue of what level of knowledge is required for the intermediary’s actions to constitute ‘aiding’ and makes a analytical leap from determination of ‘use’ under the Trademark Act to that of ‘aiding’ and unlawful act. Therefore, no clear principle on the basis of which the intermediary may be made liable emerges.

What is particularly striking about the judgement is the determination of the defendant’s positive obligation to verify its inventory without a determination of the lawfulness of its use by the sellers themselves.It is unclear whether the judgement imposes a general positive duty to ascertain whether the goods sold by such platforms are genuine or not, although this likely depends upon the nature of the business as per the ‘factors’ enumerated by the court. The Court’s decree imposes such an obligation in order for the defendant to continue its business and also imposes an obligation upon the platform make its own assessment of whether certain notified product is counterfeit or not, after reaching out to the seller. This places the intermediary in the position of facing legal liability for failing to remove notified posts, even without a judicial determination of its lawfulness, which contrary to the principles and the rule laid down in Shreya Singhal v Union of India, that intermediaries may only be required to take down content if notified by a court or government order to do so (although the Court continues to insist that the ratio of that judgement does not apply to IP, without providing sufficient justification for this claim).

The issue of online sale of counterfeit products is pervasive in Indian e-commerce and lacks sufficient consumer protection mechanisms. Even in the facts of this case, had the goods not been genuine, it may have been difficult for the platform to escape secondary liability for infringement. However, in its haste to ensure an effective remedy to rights holders, the Court has left the actual issue of clarifying intermediary liability aside. In the Court’s interpretation, the balance of convenience for the issue of an injunction clearly falls in favour of the rights holder, and not the platform, through what appears to be a ‘know it when you see it’ approach which considers the whole of the business model of the e-commerce platform, including both its online and offline aspects, to determine whether the platform is acting in good faith or not.

While the concern for online infringement and to protect rights holders is legitimate, the route that the Court takes muddles the issue of platform liability for online infringement, and the legal uncertainty is likely to have a negative effect on the online sale and purchase of goods.

We’re pleased to announce that on the margins of the Third World Week of Italian Cuisine (November 20-26) in India, the Embassy of Italy in collaboration with K&S Partners, is organizing a half-day seminar on geographical indications (GIs) on Monday, November 26, 2018 in New Delhi. The seminar intends to look at practical issues concerning the protection and enforcement of GIs in India, European Union (EU) and Italy. For further details, please read below:

Seminar Title: Protection and Enforcement of GIs in India, EU and Italy

Date: Monday, November 26, 2018

Time: 9:00 am – 01:00 pm, followed by networking lunch

Venue: Embassy of Italy, Nyaya Marg (Italian Cultural Centre Gate), Chanakyapuri, New Delhi

A panel of experts who handle issues related to GI protection and enforcement from India and the EU will be leading the discussions in the seminar.

The panel will focus on:

–   Overview of Indian GI

–   GI protection for food stuffs: Time for India to consider a traditional recipe law?

–   EU GI system and types, including control and quality standards – practical examples

–   Overview of Italian GIs

–   How to start and setting up of a strategy to enhance GI visibility

Interested participants may RSVP to rsvpitalyinindia@gmail.com by Friday, 23rd November 2018.

This month saw a highly publicised altercation between pop queen Rihanna and US President Trump.  She called out the President for playing her popular hit song “Don’t Stop the Music” at his rally. In her cease-and-desist letter, Rihanna’s legal team specified that the idol’s consent should have been taken before playing her song at the rally. The issue, however, is more complicated than the simple matter of the artist’s consent to such usage and has been highly debated in the past. This is not the first time a US politician has faced claims of IP infringement for such usage. (In fact, here’s a lengthy list of famous artists who have publicly protested the use of their works by politicians such as Trump, Mitt Romney, Sarah Palin and many more.)

Status Quo in USA: Licensing Guidelines and Legal Claims Available

In USA, copyright of musical works are administered by Performing Rights Organisations (PROs) such as American Society of Composers, Authors and Publishers (ASCAP),  Broadcast Music, Inc. (BMI) etc. PROs acts as representatives for musical woks of various artists, songwriters and composers. Politicians need to obtain “public performance” licenses from the appropriate organisations to play the copyrighted musical works at their campaign. If these campaign events are properly licensed, politicians can use these works without taking the prior consent of the concerned artist and avoid copyright infringement suits. The following defences, however, can be availed by artists in such cases:

1. Infringement of Right of Publicity: Right of publicity (also known as personality rights in most jurisdictions) is a common law right and is derived from the right to privacy. It protects the right of a famous individual to prevent commercial exploitation of his/her name, image or persona. This right is not provided by any US federal statute and hence differs from state to state. Since most state laws provide for First Amendment exceptions (which include political campaigning) in right of publicity statutes, past claims have mostly been ineffective.
2. False Endorsement under Section 43(a) of Lanham Act: Playing songs of popular artists in rallies may often create a false impression of artist’s support for the politician and can result in a form of trademark infringement known as false endorsement. It is necessary to prove that the song is used in a “deceptive and misleading” manner so as to result in consumer confusion about the association or endorsement of the artist. Such usage is forbidden under Section 43 which prohibits usage which “is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person“. The provision further prohibits dilution of trademarks (such as an artist’s or band’s name) by such unauthorised usage.
3. Infringement of Moral Rights of Artist: Moral rights are non-economic, personal rights granted to the creator (who may not necessarily be the owner) of a work. These rights include the right of attribution, the right of integrity and the right to have a work published anonymously or pseudonymously. Although moral rights are only formally extended to works of visual art under the Visual Artists Rights Act in USA, there is a lot of debate about extending the scope of this protection to other works, including musical works. Artists may, hence, claim protection of their moral rights in the future in such cases of political usage.

Status Quo in India: Issue not Addressed Yet

In India, public performance licenses for using musical works at public venues need to be procured from Indian Performing Rights Society (IPRS) or Phonographic Performance Limited (PPL). Though Indian politicians don’t use musical works in their rallies as frequently as their American counterparts, politicians in Meghalaya, Kolkata etc. have been reported to use popular musical works to evoke emotions from the crowd and garner votes. Surprisingly, neither of the bodies have considered the possibility of such legal confrontations arising in the future. Neither IPRS nor PPL address political usage of musical compositions in their public performance licenses.

Suggested Solutions

The legal claims against unauthorised use of musical compositions by politicians in USA have often proven to be ineffective in the past and hence, copyright holders remain dissatisfied with the current legal protection available to them. Usually, PROs in USA issue  “all or nothing”  licenses which grant permission to licensees to use numerous musical compositions under the PRO’s ambit for a fixed fee, thereby allowing politicians to bypass the procedure of gaining the consent of each individual copyright holder. It has been proposed that such licenses should be altered to include clauses which give the power to artists and songwriters to opt out from usage of their compositions at political venues. For example, BMI had introduced a Political Entities license which allows the concerned songwriters or publishers to withdraw any particular musical work from the license. Although such requests can only be made after the song is used, such licenses aid in preventing further usage of the copyrighted work. ASCAP’s guidelines also suggest that before availing a public performance license, politicians must gain the artist’s and/or the songwriter’s consent for using the copyrighted musical work. 

Conclusion: A shift in current licensing norms and a shift in attitude towards artists’ and songwriters’ copyright in their musical compositions would both go a long way in preventing such legal confrontations. Also, a suitable licensing framework addressing such issues needs to be adopted in India to prevent similar controversies from cropping up in the future.

Image from here

Divij analysed the approach of the Delhi HC towards intermediary liability in its recent ruling in Loreal v. Brandworld. This post is a continuation of his commentary on the same topic in a previous post on Christian Louboutin v Nakul Bajaj. In his post, he first lays out when an e-commerce platform becomes an intermediary and when it can claim safe harbour under Section 79 of the IT Act. He then goes on to conclude that the Delhi HC does not give adequate clarity on intermediary safe harbour. Further, he concludes that the judgment does not provide any finding on primary and secondary liability of online marketplaces.

I had written a post on the Rihanna-Trump controversy (The pop idol had called out the President for playing one of her popular songs at his rally). In my post, I first examine the licensing norms regarding such political usage and the legal protection available to copyright holders in such cases. Noting that the Indian licensing regimen does not address this issue, I conclude that current licensing norms need to be revised in USA and the same needs to be introduced in India. I further conclude that consent of copyright holders must be procured for such political usage.

SpicyIP Events

Pankhuri recently announced that the Embassy of Italy, in collaboration with K&S Partners, is organizing a half-day seminar on protection and enforcement of geographical indications (GIs) in EU and Italy on Monday, November 26, 2018 in New Delhi.

Other Developments

Indian

Judgments

Wrangler Apparel Corporation v. Harkhit Rawat – Delhi District Court [November 15, 2018]

The Court granted an ex parte permanent injunction restraining the Defendant from using the mark “WRANGLER” in infringing and passing off the Plaintiff’s identical mark in respect of apparel, garments, jeans and allied goods. The Court stated that the Plaintiff was the registered proprietor of the mark and on its comparison with that of the Defendant found them to be structurally, visually and phonetically similar. The Court also considered it appropriate to grant punitive and compensatory damages to the tune of Rupees 2 lakhs in light of the Plaintiff being unnecessarily dragged into litigation.

Omaxe Limited and Another v. Omaxe Infraproject Private Limited and Others – Delhi District Court [November 17, 2018]

The Court granted an ex parte permanent injunction restraining the Defendant from using the mark “OMAXE” in infringing and passing off the Plaintiff’s identical mark in respect of real estate or any other goods or services. In arriving at the decision, the Court noted that the Plaintiff was the registered proprietor of the mark “OMAXE” and on account of the mark’s continuous and extensive use, stated that it could be solely associated with the Plaintiff. Moreover, the Court found the Defendant’s mark to be structurally, visually and phonetically similar to that of the Plaintiff, and noted that co-extensive use of the rival marks would cause confusion in the public and adversely affect the goodwill and reputation of the Plaintiff. In light of the aforementioned, the Court considered it appropriate to award damages of Rupees 2 lakhs to the Plaintiff.

News

• Director Radha Bharadwaj moves HC against Akshay Kumar’s ‘Mission Mangal’ over copyright
• Govt to launch initiative to boost intellectual property in defence sector: Top Official
• After rhyming name game, Starbucks files cases against firms supplying fake company products

International

• ‘Scream’ Mask Maker sues Celtics’ Terry Rozier for Copyright Infringement
• US Judge Slams Copyright Troll For Using His Court “Like an ATM”
• Satanist group settles $50m lawsuit with Netflix in copyright row over Sabrina TV show
• Zhang Yimou’s ‘Shadow’ Hit With Music Copyright Lawsuit

We’re pleased to announce that the Centre for Law and Policy Research (CLPR) is inviting applications for the CLPR Equality Fellowship. The deadline for applications is December 30, 2018 (edited). For further details, please read the call for applications below.

• Successful candidates will be young, talented lawyers who demonstrate a strong interest in rights-based advocacy and a commitment to public interest law
• Law graduates with an L.L.B degree who have a minimum of 2 years of litigation experience
• Applicants should be registered and enrolled with the Bar Council of India
• Should have a working knowledge of either Kannada, Telugu, Malayalam or Tamil
• Should have excellent writing and drafting skills
• CLPR is an equal opportunity employer and strongly encourages persons from SC/ST backgrounds, minority religions, LGBTQI+ persons and persons with disability to apply

1. A signed and completed CLPR Equality Fellowship Application Form
2. Two (2) writing samples (published articles, essays, blog posts) between 500-2000 words
3. Resume/CV
4. Applications to be submitted by December 30, 2018, 5pm IST (edited)

Earlier this year, a group of primarily Indian scientists stirred a pot a bit when they published a piece in Science on how the Convention of Biological Diversity (CBD) is a ‘cure’ that ‘kills’ because it has made biodiversity research quite complicated. The argument put forth by these scientists is that the CBD was inspired by unrealistic expectations regarding the commercial value of their biological resources and that the fences erected by national legislation (in pursuance of the CBD) have made it prohibitively difficult for scientists, especially taxonomists to document biological species that are going extinct at a startling pace. According to them, countries like India are particularly impacted because national legislation like the Biological Diversity Act make collaborative research between Indian and foreign researchers much tougher because foreigners cannot access Indian biological resources without an elaborate set of permissions from the government. There are certain exemptions for collaborative projects but even those exemptions involve some red tape. This means that talent and resource strapped Indian research institutes find it much tougher to collaborate with foreign institutes.  The Science piece ends with a call for policy makers to do something about the CBD so that scientists can discover, document and conserve biological resources. Their critique has not gone down very well with environmental activists in India who wrote a response in the Economic and Political Weekly accusing the scientists of the piece in Science of “hubris” – an unfair accusation in my opinion.

As I explained in an earlier post, the reason we end up covering the Biological Diversity Act on SpicyIP is because the current design of the legislation is influenced by the concerns of plant/biological resources based inventions being patented by foreigners to the exclusion of Indians. These could be innovations such as the Jeevani drink in the Kani tribe case or the RiceTec case where basmati seeds from India became the source of a new crop in the US that could potentially compete with basmati exports from India.

In my opinion, the key to understanding policy debates is to trace the history of any particular issue and interrogate the cause and effect of the policy under debate. Towards this end, I wrote a long article that was published in the Intellectual Property Quarterly (IPQ) on whether India has simply lost the plot on the issue of access to plant genetic resources meant for food and agriculture. I think it is necessary to understand this issue in context of food and agriculture because it is this debate which mutilated into the CBD.

The debate on plant genetic resources kicked off post World-War II, when scientists raised the red flag on dwindling plant genetic material due to development activities and more farmers adopting the same seed type across multiple jurisdictions. This led to the disappearance of several local varieties. The disappearance of these varieties was deemed hugely problematic from the standpoint of food security and agricultural innovation because these local varieties can have natural resistance to certain pests or certain other qualities that are the result of centuries of natural evolution.

The international response to dwindling plant diversity was to start building seed banks by collecting seeds from several different jurisdictions. There was apparently a time when the US Department of Agriculture used to fund plant and seed collecting expeditions across the world. Around the late sixties, the United States and Europe also started enacting new IP legislation aimed at protecting plant innovations. The prospect of proprietary plants under IP legislation caused concern amongst developing countries because most of the plant genetic material being collected by the US and EU came from developing countries.

Questions were also raised about the ownership over the massive international seed collections by the Consultative Group on International Agricultural Research (CGIAR) which was the umbrella group that funds the 11 biggest international agricultural research centres (IARCs) like IRRI, ICRISAT, CIMMYT etc. These centres were setup by the World Bank and international philanthropies like the Rockerfeller and Ford Foundations with the aim of creating international research for major food crops across the world. These centres were inspired by the success of the Green Revolution and the prospect of a world where food security could be assured through well-funded research. The World Bank worked hard to keep these centres outside the UN system because of an understandable allergy towards the lethargy of international governmental organisations. As a part of their research activities these centres had accumulated huge seed banks which were built through contributions and collections from mainly developing countries.

When the IP issue became of a concern, developing countries tried to force a resolution at the Food and Agriculture Organisation (FAO) in 1981, called the International Undertaking on Plant Genetic Resources. The language in this International Undertaking wanted all plant genetic resources, including those protected under national IP legislation, to be declared as the “common heritage of mankind” freely accessible by all countries. The most powerful developed countries – Canada, France, Germany, Japan, Switzerland, UK and the US opposed this demand because it would involve depriving their citizens of property rights under their national legislation. They also opposed the demand to shift control of the seed banks with 9 IARCs to the control of the UN. In the decade the followed activists like Pat Mooney began their high decibel advocacy about seeds, agricultural and biodiversity. (Read this book by Kloppenberg for an excellent history of these movements and the history of the biotech industry). It did not take much for left leaning activists to draw analogies to colonialism by pointing out how developed countries were ‘plundering’ raw materials (biological resources) that would be processed and sold back to the ‘natives’ at a higher price (in the form of pharmaceutical drugs or seeds). The fact that the US was imposing a global IP regime on developing countries through TRIPS added fuel to the ‘biopiracy’ behaviour because it now meant that MNCs could protect their IP even in developing countries.

For reasons that are not clear scientists were not very vocal in their advocacy against the CBD in 1993 when it was concluded. However, given the relatively strong lobby of international agricultural research centres which owe their existence to the seamless sharing of plant genetic material across borders, they were quick to take steps to counter the CBD. The solution came in the form of the International Treaty on Plant Genetic Resources for Food and Agriculture (ITPGRFA) which basically put 64 common food crops into a common pool that could be shared across borders after the signing of a material transfer agreement that contains few restrictions on how the material can be used. In case the plant genetic material is the source of a new variety that is being protected under an IP law, the recipient is encouraged to make a payment into a common fund established under the treaty. This fund is used to fund research projects in different countries. This is a far cry from the benefit sharing mechanism envisaged by the CBD or the Nagoya Protocol where developing countries or their citizens are to benefit monetarily from the practise.

India has signed the ITPGRFA and the Ministry of Agriculture issued a series of notifications to exempt certain food crops from the ambit of the Biological Diversity Act. I think only 9 crops have been notified as of now but technically the Ministry of Agriculture could exempt all 64 food crops that part of the ITPGRFA. The Biological Diversity Act however still causes chaos for a large number of other biological resources not exempted by the ITPGFRA.

A few months ago, I spoke to Advocate Sunita Sreedharan who represents a fair number of clients facing legal threats under the Biological Diversity Act and as per her information, a large number of businesses are facing unjustified legal threats from state level biodiversity boards. In one case there was apparently a raid on the premises of a company by forest officers who man the biodiversity board – despite the fact that the law does not give them the power to carry out raids for offences under the Biological Diversity Act. The list of companies at the receiving end includes the herbal products industry, paper manufacturers and the alcohol industry. That these companies are at the receiving end is rather strange for the reasons I explained in an earlier post – the Biological Diversity Act is supposed to apply in cases where a company researches on a biological resource to extract some compounds/oils and make a value added product. Pulping trees into plants or making beer out of barley does not count as commercial utilisation under the Biological Diversity Act. In one absurd case in Madhya Pradesh, someone tried to argue that coal would count as a biological resource and that the proceeds of coal mining would be subject to benefit sharing under the Biological Diversity Act. It is therefore not surprising when such enforcement actions are challenged before courts. As of now the litigation against the state level enforcement of these law is taking place before the High Courts at Bombay, Uttarakhand, Himachal Pradesh, Allahabad and the National Green Tribunal in Delhi.

The Biological Diversity Act is not a case of a good idea that is poorly implemented. The legislation itself is a disaster in that it has opened the door to arbitrary enforcement action. The government should consider repealing it. Anybody arguing in favour the legislation needs to provide evidence of its success in at least one case over the last 16 years. To the best of my knowledge there has not been a single case where a community or group of people have received any monetary benefits under the benefit sharing provisions of the law. In the meanwhile, essential scientific research is also being severely impacted. If literally nobody is benefitting from this law apart from corrupt bureaucrats, why do we still have it on the statute book?

Prashant wrote a post about the impact of India’s biodiversity laws’ impact on scientists and businesses. After tracing the history of the biodiversity laws that we see today, he argues that the legislation should be repealed because it opens the door for arbitrary enforcement against businesses and impedes research efforts by scientists.

Pankhuri informed us of the invitation for applications for the CLPR Equality Fellowship with the Centre for Law and Policy Research. The fellows will be expected to engage in litigation and advocacy pertaining to intersectional discrimination in the states of Andhra Pradesh, Karnataka, Kerala and Tamil Nadu The deadline for the applications is December 30, 2018.

Other Developments

India

Judgments

Luxembourg Brands S.A.R.L. and Another v. G.M. Pens International Private Limited – Delhi High Court [November 26, 2018]

The dispute between the Parties arose on the ground that the Defendant had used the mark “RORITO” in infringing and passing off the Plaintiffs’ mark “REYNOLDS” in respect of writing instruments. The Plaintiffs stated that the Defendant was its licensee for a brief period, and after the expiry of the licensing arrangement between them promoted its product in a manner to give the general public a perception that the mark “REYNOLDS” was re-branded as “RORITO”. In considering the Plaintiffs’ argument of passing off, the Court observed that the Defendant did not commit any action of passing off as there was no misrepresentation in its advertisements and that the Defendant merely sought to sell its goods under its bona fide mark “RORITO”. The Court also considered the Plaintiffs’ argument that the Defendant had undertaken a campaign to indicate that “REYNOLDS” was re-branded to “RORITO”, and stated that the evidence filed before it was insufficient to arrive at such a conclusion. Moreover, the Court on a comparison of the rival marks disagreed that their logos were similar. As a related issue, the Plaintiffs claimed that the Defendant’s adoption and use of the mark “TERAMAX” in place of “T-MAX” was infringing of its mark “TRIMAX”. The Court agreed with the Plaintiffs and observed that the Defendant had substituted one similar mark (T-MAX) with another (TERAMAX), which bore a higher similarity to the Plaintiffs’ mark, and accordingly violated the orders passed by the Court on a previous occasion. In view of this particular violation, the Court imposed a penalty of Rupees 5 lakhs on the Defendant, payable to the Plaintiffs within a month.

M/s. Bombay Sewing Machine Company v. M/s. Nipex Light House & Welding – Delhi District Court [November 28, 2018]

The Court granted a permanent injunction restraining the Defendant from using the mark “DURBEY” in infringing and passing off the Plaintiff’s deceptively similar mark “DURBY” in respect of sewing machines. In arriving at this decision, the Court noted that the Plaintiff had been using its mark since 1954 and was also the registered proprietor of the mark. Further, the Court stated that there was no substantial difference between the rival marks as the Defendant’s mark was visually, structurally and phonetically similar to that of the Plaintiff, and the Defendant’s use of the Plaintiff’s mark would lead to loss of Plaintiff’s goodwill and reputation.

M/s. Facton Limited v. Shri Varun and Another – Delhi District Court [November 29, 2018]

The Court granted an ex parte permanent injunction restraining the Defendant from using the mark “G-STAR” in infringing and passing off the Plaintiff’s identical mark in respect of clothing and allied goods. In arriving at this decision, the Court noted that the Plaintiff was the registered proprietor of the well-known mark and that the Defendant could not use it to conduct business. In view of the same, the Court granted punitive and compensatory damages to the tune of Rupees 1 lakh in favour of the Plaintiff.

M/s. Lacoste S.A. v. Devi Dayal and Another – Delhi District Court [November 29, 2018]

The dispute arose between the Parties on the ground that the Defendant was using an identical mark to that of the Plaintiff’s registered mark “LACOSTE”. In the suit filed by the Plaintiff, the Court denied the grant of an injunction in favour of the Plaintiff. The Court examined the evidence filed by the Plaintiff and noted that the Plaintiff had failed to place any documentary evidence on record to prove infringement on of its registered mark by the Defendant.

News

• Soon, trade names of drugs may be regulated
• Cinefil Producers Performance Limited applies for registration as a copyright society in respect of cinematograph film works
• Pay royalty as I hold the rights to my songs, says Ilayaraja
• High Court gets involved to stop leak of Rajini’s 2.0

International

• American Copyright Royalty Board Makes Flurry of Changes, Extends Comment Period For Music Modernization Act
• Intel Awarded a Patent for a New Bitcoin Mining Process

We’re pleased to announce that Boehmert & Boehmert, Patent & Trademark Attorneys, Germany will be conducting workshops on Patent Strategies in Europe For Pharma & Biotech on January 15, 2019 in Ahmedabad and on January 16, 2019 in Hyderabad. For further details, pl read below:

Patent Strategies in Europe For Pharma & Biotech Workshops by Boehmert & Boehmert Patent & Trademark Attorneys Germany

Boehmert & Boehmert, Patent & Trademark Attorneys, Germany will be holding workshops on Patent Strategies in Europe For Pharma & Biotech. Senior partners from Boehmert & Boehmert (www.boehmert.de) will share latest development at EPO and case laws. As you may be aware, 60% of all patent litigation in Europe takes place in Germany.

The workshops will be held from 10am-2pm, followed by lunch at Hotel Four Seasons by Sheraton, Ahmedabad on 15 January 2019 and at Hotel Taj Banjara, Hyderabad on 16 January 2019. All IP professionals are welcome.

There is no fee for the event. Since the number of delegates is strictly limited, an early response at our contact coordinates given below would be welcome:

Mr. S.Abidi
IPR Associates
iprassociates@gmail.com
9324053831

IP overlaps take place when multiple overlapping IP rights vest in an owner for a single subject matter. These overlaps have given way to numerous debates regarding over-protection, policy implications, statutory interpretation  and many more issues. (To get a better understanding of the same, do refer to Prof. Basheer’s chapter in Overlapping Intellectual Property Rights.) Design-trademark overlaps, in particular, have had an interesting history in Indian litigation. A recent decision of the Delhi HC yet again brings these overlaps to the fore.

In its decision, Greenlight Planet India Pvt. Ltd. vs Gee Lighting Technology, the Delhi HC dismissed an application filed for rejection of plaint. The plaintiffs had instituted a suit for permanent injunction restraining passing off of its goods under the trademark GEE-LITE. Prior to this, they had filed a suit for design infringement. The counsel for the defendants relied on Order II, Rule 2 of the CPC, which provides that where the plaintiff omits to sue or relinquishes a part of their claim, “he shall not afterwards sue in respect of the portion so omitted or relinquished.” Citing this, the defendants argued that the plaintiffs having relinquished their claim with respect to passing off of their goods in the earlier suit, they could not claim the same in the present suit. The counsel for the plaintiffs cited the 2013 Delhi HC judgment in the Micolube case to argue that the cause of action in the two suits were entirely different. The Delhi HC, in its judgment, laid down that Order II, Rule 2 intended to protect people from multiplicity of suits and being sued twice for the same cause of action. The Court opined that “a cause of action for an infringement suit under the Design Act is different/separate/distinct from the cause of action for a passing off suit of a trade mark, trade name and domain name” and went on to conclude, thereby, that Order II, Rule 2 would not apply to the facts of this particular case.

A quick recap of past judicial opinions on design-trademark overlaps is needed here to understand the issue at hand with more clarity. In his analysis of deisgn-trademark overlaps in India, Prof. Basheer cited two important judgments, Tobu Enterprises Pvt. Ltd. v. Megha Enterprises (“Tobu Enterprises“) and Smithkline Beecham v. Hindustan Lever Limited (“Smithkline“). In Tobu Enterprises, the plaintiff claimed relief for both, design infringement and the tort of passing off. The Court observed that although the Trademarks Act, 1958 contained a saving clause for passing off actions, the Design Act did not provide for the same and hence, the plaintiff could not claim relief for passing off. The Court in Smithkline differed from this line of reasoning stating that dual protection could be sought under overlapping IP regimes (particularly in the case of shapes, since these could be protected under both design and trademark laws). Later, in Micolube India Limited v. Rakesh Kumar Trading, a single Judge followed the reasoning in Tobu Enterprises  by focussing on the saving clause for passing off actions under Section 27 (2) of the Trade Marks Act and the lack of a similar provision under the Design Act. The decision was then referred to a larger bench, which delivered its decision in 2013. The Bench studied the legislative intent of both, the Trade Marks Act, 1999 and the Design Act, 2000. With regard to the Trade Marks Act, the Bench concluded that the “registration of the trade marks is the statutory recognition of the rights pre-existing in common law” and hence the Act specifically provided for a savings clause for common law reliefs for passing off. Design rights, on the other hand, originate solely from the statute; the Bench, in this regard, observed that “passing off is a right to sue in common law to prevent misrepresentation is mutually inconsistent and distinct from the purely statutory monopolies which are in the form of privileges like patents and design“. It thus correctly disregarded the reasoning adopted by the Single Judge and Tobu Enterprises.

The Bench did, however, err in its reasoning when it stated that a design once registered could become a functional trademark. The Court entirely based its reasoning on Section 19 in the Design Act which provides grounds for cancellation of designs and concluded that since the use of a registered design as a trademark is not given as one such ground, the product could be protected under both the IP regimes. But on a closer reading of the provision, Section 19(1)(e) provides that    if it is not a design under Section 2(d), the registration of the said design can be cancelled. In his analysis of the 2013 decision, Prof. Basheer pointed out that the definition of design under Section 2(d) includes shape, configuration, pattern etc. but  “does not include any trade mark as defined in clause (v) of sub-section (1) of section 2 of the Trade and Merchandise Marks Act, 1958“. He then concluded that the interpretation of Section 19 would require the cancellation of registration of design once it began functioning as a trademark. The question thus arises:  How can one claim remedy for passing off for a registered design?

Surprisingly, the Delhi HC merely applies Order II, Rule 2 of the CPC and does not analyse the relevant provisions of the Trade Marks Act or the Design Act to settle this unresolved issue. It has to be noted here that it has already been settled quite satisfactorily in previous judicial decisions that the cause of action under a design infringement suit is different from that under a passing off suit and that this issue did not require any further analysis in the present decision. The main issue here which needed to be looked into was whether the design registration still subsisted or not and which the Court seems to have overlooked entirely.

Image from here

We’re pleased to announce that the Centre for Intellectual Property Rights, National University of Advanced Legal Studies (NUALS), Kochi is inviting submissions on the contemporary issues related to intellectual property rights for publication in the inaugural volume of the The Intellectual Property Law Review. For further details, please read the call for papers below:

Centre for Intellectual Property Rights

The Intellectual Property Law Review

Call for Papers Vol. I

The Centre for Intellectual Property under the aegis of the National University of Advanced Legal Studies welcomes submissions for the first volume of the Intellectual Property Law Review. With the objective to make meaningful contributions to the field, we encourage our authors to explore contemporary issues and areas often overlooked relating to intellectual property law and policy. The Intellectual Property Law Review is a student-edited, peer-reviewed, double blind and open access journal. We invite contributions from practitioners in the legal profession, undergraduate and post-graduate students, researchers and academicians in the form of articles, essays, notes, commentaries and reviews.

Nature of Submissions

– Articles: (5000 – 7000 words)
– Essays: (3000 – 5000 words)
– Notes, Comments and Reviews: (1000 – 3000 words)
These word limits are inclusive of footnotes.

Submission Guidelines

1. All submissions are to be made in electronic form and must be sent to theiplawreview@gmail.com on or before 16th January, 2019, 11:59 PM. No other form of submission shall be accepted.
2. All submissions must include an abstract not exceeding 500 words.
3. A separate document providing a brief note including the following information: Name, Address, Postal Address, Name and Address of Institution, Course of Study (if applicable), Academic Year.
4. The manuscript itself should be free of any identification of the author.
5. Co-authorship is limited to two.
6. By submitting the article, the author undertakes that the article is an original work and has not been submitted, accepted or published elsewhere.
7. All submissions will be subject to a plagiarism check at the first stage of evaluation. If a work is found to be not original or plagiarised, it stands rejected at the first instance.
8. Receipt of submission shall be intimated within one week of the authors’ submission.
9. A minimum period of three months from the final date for submission of articles is reserved before the communication of acceptance is made to the author.

Formatting Guidelines

1. All submissions must be made in Word Format (.doc)/(.docx).
2. The body of the manuscript should be in Times New Roman, size 12 with 1.5 spacing. The Bluebook (20th ed.) is to be followed for the citation format. Footnotes should also be in Times New Roman, size 10 and single spacing.

For any queries, contact us at theiplawreview@gmail.com or:
+91 – 8606458450 (Anjanaa Aravindan)
+91 – 8197874621 (Pranav Pillai)

This week, I had written a post on a recent Delhi HC decision dealing with a design-trademark overlap. In my post, I briefly discuss previous judicial decisions dealing with similar overlaps. I then cover the (in)famous Micolube decision and Prof. Basheer’s take on the same. Finally, I conclude that the provisions of the Design Act does not allow one to claim a remedy for passing off for a registered design and that the Delhi HC failed to consider this issue in their judgment.

SpicyIP Announcements

Pankhuri announced that Boehmert & Boehmert, Patent & Trademark Attorneys, Germany are conducting workshops on Patent Strategies in Europe For Pharma & Biotech on January 15, 2019 in Ahmedabad and on January 16, 2019 in Hyderabad.

She also informed us about a call for papers by the Centre for Intellectual Property Rights, National University of Advanced Legal Studies (NUALS), Kochi for the inaugural volume of the The Intellectual Property Law Review. They are inviting submissions on contemporary issues related to intellectual property rights.

Other Developments

Indian

Judgments

Levi Strauss & Co. v. Ram Pal – Delhi District Court [November 24, 2018]

The Court granted an ex parte permanent injunction restraining the Defendant from using the mark “LEVI’S” in infringing and passing of the Plaintiff’s identical mark in respect of readymade garments and clothing and leisure shoes. The Court stated that the Plaintiff was the registered user of the mark which had acquired distinct features and secondary meaning with respect to trading in readymade garments.

Voltas Limited v. Vishal Dua & Another – Delhi High Court [November 27, 2018]

The Court granted an ex parte permanent injunction restraining the Defendant from using the mark “VOLTAS” in infringing and passing off the Plaintiff’s identical mark in respect of electric irons. The Court arrived at this conclusion on the basis of the Commissioner’s statement regarding the wide usage of the Plaintiff’s mark by the Defendant.

Flamagas, S.A. & Another v. Mr. Ojas B. Shah – Delhi High Court [November 28, 2018]

The Court granted an ex parte permanent injunction restraining the Defendant from using the mark “CLIPPER” in infringing and passing off the Plaintiff’s identical mark in respect of cigarette lighters. In arriving at this decision, the Court noted that the Defendant had no real prospect of defending its claim as it did not produce any arguments in support of its claims. Additionally, the Court stated that the Plaintiff’s mark had acquired reputation and goodwill globally and the Defendant’s actions amounted to clear infringement of the Plaintiff’s mark.

Arun Chopra v. Kaka-Ka Dhaba Private Limited & Others – Delhi High Court [November 28, 2018]

The dispute arose between the Parties on the ground that the Defendant was using a deceptively similar mark “KAKA KA DHABA” in infringing and passing off the Plaintiff’s mark “KAKE DA DHABA”. The Plaintiff had also filed a proceeding before the Intellectual Property Appellate Board seeking the cancellation of the Defendant’s registration. In light of this proceeding, the Court passed an interim order modifying its previous order wherein the Defendant was permitted to use the mark “KAKA KA DHABA” in respect of its already operating establishments and was additionally restrained from opening new establishments under the mark. It also ordered the Plaintiff to place a copy of the cancellation petition filed before the Intellectual Property Appellate Board before it within two weeks.

M/s. Varsha Polymers and Others v. M/s. Vajra Plastics Industry – Kerala High Court [December 3, 2018]

The dispute arose between the Parties on the ground that the Appellant was using an identical design to that of the Respondent’s registered design for PVC pipes. The District Court granted a temporary injunction in favour of the Respondent. In the appeal filed by the Appellant, the Court set aside this decree of temporary injunction on the ground that the reasons on record were not appreciated correctly by the District Court. In pointing out the main flaw of the decision, the Court noted that the certificate of design registration does not create a pre-supposition of uniqueness in favour of the registrant’s design.

M/s. Vrajlal Manilal & Co. v. Sh. Ghanshyam Das Aggarwal – Delhi District Court [December 4, 2018]

The Court granted a permanent injunction restraining the Defendant from using a label with the mark “22” on printed on it in infringing and passing off the Plaintiff’s identical seal and mark in respect of biris. In arriving at this decision, the Court noted that the Defendant had created its label with reference to the Plaintiff’s copyrighted label and hence, it was a clear case of copyright infringement. The Plaintiff also held a valid registration of the mark “22” in respect of its goods and, the Court noted that the Defendant’s adoption of an identical mark with respect to similar goods was a clear case of trademark infringement. The Court also noted that the Defendant’s continuance of infringing activities would lead to erosion of the Plaintiff’s reputation and distinctive character.

News

• IPAB issues notice in the first Section 31D application filed by Radionext Webcasting Pvt. Ltd
• HC restrains entities from using Snapdeal trademark
• Comedian Raju Srivastava gets legal notice from Sony TV over posting KBC clip
• DIPP floats draft patent rules

International

• Facebook Files for Ill-Timed Patent for Feature That Knows Where You’re Going (Even Before You Do)
• ‘Blurred Lines’ copyright lawsuit: Robin Thicke, Pharrell ordered to pay $5M
• Proud Boys Founder Banned For Copyright Infringement
• Facebook and ZeniMax settle VR copyright lawsuit

A few days ago, I had written a post on the Delhi HC’s judgment in Greenlight Planet India Pvt. Ltd. vs Gee Lighting Technology dealing with a design-trademark overlap. The Court, in this order, had deliberated on the issue of whether a separate suit of passing off can be filed for a registered design after having filed a prior suit of design infringement. In their order, they limited their analysis to Order II, Rule 2 of the CPC (which does not allow one to file multiple suits for the same cause of action). Given the numerous past judicial decisions dealing with such overlaps, it is quite surprising that the Delhi HC omitted to consider the application of Order II, Rule 3 of the CPC (which allows for joinder of multiple causes of action in certain cases) and the relevant provisions of the Design Act and the Trade Marks Act.

Our readers then alerted us about the latest decision covering such overlaps: On 14th December, 2018, a 5-judge Bench of the Delhi HC reconsidered the maintainability of a composite suit filed for infringement of a registered design and for passing off. This question of law had  been referred to this Special Bench by a Single Judge in Carlsberg Breweries v. Som Distilleries.

About the Carlsberg Case

Carlsberg instituted a composite suit for design infringement and passing off of their “TURBO” beer bottles against Som Distilleries for manufacturing “HUNTER” beer bottles with numerous similar features.  The 2013 Micolube decision, wherein it was held that a composite suit for design infringement and passing off was not maintainable, was applied in this case and the Single Judge refused to grant an interim injunction to Carlsberg based on the same. The Court in Micolube had reached this conclusion by relying on the Supreme Court’s decision in Dabur India v. R. K. Industries.  In Carlsberg, the advocates representing Carlsberg quite rightly argued that such a reading of the Dabur case was erroneous and that the Micolube judgment was per incuriam. In the Dabur case, the Supreme Court had only disallowed joinder of different causes of action when the Court lacked the jurisdiction to entertain any one of the causes of action. For more clarity on this, check out how Prashant explained the jurisdiction aspect in his post analysing the Carlsberg decision:

“For example the jurisdiction clauses apply differently for trademarks and passing off because in the former case the plaintiff can sue at the place of his business, while in the latter case, the plaintiff can sue only where the defendant resides or where the cause of action arises. In such lawsuits, depending on the facts, the same court may lack the jurisdiction to hear the trademark infringement claim and the passing off claim and hence both cannot be combined into one lawsuit.”

The Judge also noted that the Court in Micolube may have failed to apply Order II, Rule 3 of the CPC and hence, the decision needed reconsideration by a larger Bench.

Maintainability of Composite Suits

After delving into past decisions, the Bench came to the conclusion that “there is no per se or threshold bar to maintainability of suits, on the perceived ground of misjoinder of causes of action“. The Court further went on to state that an objection to misjoinder of causes of action is merely procedural in nature and that it could not form the basis of a rejection of a suit.

The Bench also revisited the Dabur case and stated this: “Plainly, what the court had in mind was a situation dealing with joinder of causes of action, one of which could not be tried because the court lacked jurisdiction. That however, did not mean that per se the court had no jurisdiction to try a composite suit encompassing two causes of action.“

Further, it was contended that the cause of action for a design infringement significantly differed from that of passing off since lack of novelty has to be proven in the former and establishment of plaintiff’s goodwill and deceptive similarity of defendant’s products to those of plaintiff’s has to be proven in the latter. The Court noted in this regard that both these causes of action arise from the same fact i.e., “sale or offer for sale, by the defendant of the rival product“. Justice Valmiki Mehta’s opinion throws further clarity on this. He stated that since the two causes of action arise from the same transaction of sale, it would lead to common questions of law and fact and hence, would fall under the ambit of Order II, Rule 3. He further stated that joinder of causes of action “ought” to be done in these cases in order to avoid multiplicity of such proceedings.

The judgment is still not very clear, though. They justify the maintainability of composite suits filed for these remedies in a very reasoned manner. But does this necessarily mean that one still cannot file separate suits for the different remedies (as they did in the Greenlight case)? Or will such separate suits be disallowed under Rule 2 of Order II i.e., will the Court treat filing a later, separate suit as a relinquishment of part of the plaintiff’s claim in their previous suit? As I pointed out in the previous paragraph, the Court did not mandate parties to file composite suits and merely justified filing such suits for decreasing multiplicity. After all, these remedies are sought under different causes of action and parties may choose to not go for joinder of both causes in one suit. Such doubts, hence, need to be clarified by the Court in future decisions.

Does the Design Registration Still Subsist?

In analysing the decision of the Delhi HC in my previous post, I had raised the issue of whether the design registration still persists, given the fact that certain provisions of the Designs Act does not allow the registration of a design to continue once it starts functioning as a trademark (and this question had been previously raised by Prof. Basheer on SpicyIP right after the 2013 Micolube decision):

“The Bench did, however, err in its reasoning when it stated that a design once registered could become a functional trademark. The Court entirely based its reasoning on Section 19 in the Design Act which provides grounds for cancellation of designs and concluded that since the use of a registered design as a trademark is not given as one such ground, the product could be protected under both the IP regimes. But on a closer reading of the provision, Section 19(1)(e) provides that if it is not a design under Section 2(d), the registration of the said design can be cancelled. In his analysis of the 2013 decision, Prof. Basheer pointed out that the definition of design under Section 2(d) includes shape, configuration, pattern etc. but  “does not include any trade mark as defined in clause (v) of sub-section (1) of section 2 of the Trade and Merchandise Marks Act, 1958“. He then concluded that the interpretation of Section 19 would require the cancellation of registration of design once it began functioning as a trademark. The question thus arises:  How can one claim remedy for passing off for a registered design?“

In considering the afore-mentioned provisions and issue, the Special Bench answered as following:

“…if the registered design per se is used as a trade mark, it apparently can be cancelled. The larger legal formulation in Mohan Lal (supra), that a passing off action i.e one which is not limited or restricted to trademark use alone, but the overall get up or “trade dress” however, is correct; as long as the elements of the design are not used as a trademark, but a larger trade dress get up, presentation of the product through its packaging and so on, given that a “passing off” claim can include but is also broader than infringement of a trademark, the cause of action against such use lies.“

In a nutshell, we get two major takeaways from the latest Delhi HC decision:

1. A composite suit filed for design infringement and passing off is maintainable.
2. Remedy for passing off for a registered design can be brought if the said design is not functioning as a trademark and if the remedy of passing off is claimed for trade dress infringement or any other similar infringement.

Image from here

We’re pleased to bring to you a guest post by Akshat Agarwal on the recent decision of the Court of Justice of the European Union on copyrightability of taste. Akshat is a 4th year student at the Jindal Global Law School, Sonipat.

The Sensory Copyright Conundrum: An Analysis of the CJEU’s Decision With Respect to Copyright in the Taste of Cheese

Akshat Agrawal

The Court of Justice of the European Union in the recent case of Levola Hengelo BV v. Smilde Food BV, C-310/17, had the unique opportunity to determine whether copyright, under its European contextual meaning, can subsist in the taste of a food product. This case was referred to by the Dutch Court of Appeal, for a clarification upon the limitations and ambit of the concept of “work” under the EU law, upon interpretation of Article 2(1) of the Berne Convention. The CJEU went on to hold that as the taste of a food product cannot be sufficiently determined with precision and objectivity, it won’t qualify the threshold of being a “work” under the definition given by the Berne Convention.

Background of the Case

The dispute was between the plaintiff Levola Hengelo BV and the defendant Smilde Foods, both being cheese producers and manufacturers in the Netherlands. According to the plaintiff, the product “Witte Wievenkass”, produced by Smilde, infringed upon their exclusive right to reproduction under Article 13 of the Dutch Copyright Act. The major question before the Dutch Court of Appeals was whether there can be a copyright on the sense of “taste” of a food product. The plaintiff, claiming for such copyright to be valid, argued on the precedence of the case of LANCÔME PARFUMS ET BEAUTÉ, where the Dutch Supreme Court had held a valid copyright in the scent of a perfume and consequently a possibility of copyright protection in the sense of smell. This was based on the importance and sole value of perception of the sensory element (case in point being the scent) rather than the requirement of the objective determination of the same. Ignoring this particular determination, the Dutch Court of Appeals in the case at hand inclined towards deciding against such protection and referred certain questions, such as the determination of the notion and meaning of “work” to the CJEU. This was further due to the divergence of opinions towards the protection of smell and taste under copyright law being prevalent amongst member states of the EU (for instance, the court in France ruled against protection of smell of a perfume) The questions referred were:

1. Whether EU law recognises copyright protection in taste?
2. If the answer is in the affirmative, then what requirements need to be fulfilled to meet the threshold of such protection?

Opinion of the Advocate General

The Advocate General in his opinion advised the Court against the protection of taste of cheese under the InfoSec Directive in accordance with the Berne Convention. Although the AG accepted the originality associated with the product and the existence of an author’s own intellectual creation, resulting from creative and free choices (in accordance with the threshold of originality in the EU), however argued that mere originality is not sufficient, and protection can only be granted to “work” which qualifies the threshold under Berne Convention Article 2(1). AG further continued to base his argument on the premise that only two types of senses can be said to be constituted by the aforesaid Article – i.e. visual and audible.

Further, relying on the decision in Sieckmann, a case dealing with trademark law establishing the requirement of graphic representation for protection, the AG went on to pronounce the staunch requirement of precision and objectivity in the perception of the original expression for it to qualify being a “work”.  He specifically pronounced the applicability of such a graphic representational requirement, in the case of copyright as well, which isn’t possible to fulfill in the case of taste of a product. The AG, although explicitly mentioned that this won’t mean a strict requirement of fixation in the EU, it implicitly establishes such a uniform requirement, taking away the autonomy given to Berne member states, with respect to the provision of fixation.

Decision of the CJEU

The Court, deciding upon the question of what comprises a “work”, with respect to the open ended, accommodative and inclusive definition provided for in the Berne Convention (Article 2(1)), stated:

1. Original subject matter in the sense of being the author’s own intellectual creation;
2. Must be an expression and not an idea, procedure, methods of operation or concept (in accordance with TRIPS Article 9); and
3. Must be expressed in a manner which makes it identifiable with sufficient precision and objectivity, to facilitate identification, irrespective of permanence.

On the basis of this determination, the Court concluded that there can be no copyright in taste or smell due to its basis of identification being subjective sensations and experiences. The influence of the person tasting the product would inherently shape the taste experienced because of which, according a copyright in the same won’t be feasible and enforceable.

Analysis

The final outcome of this decision, i.e. not according copyright in the taste of cheese, is a sound one, due to certain enforcement issues which come around extending copyright to such an uncertain subject matter. The rationale of requirement of unity and certainty, as in the case of dramatic works (Green v. Broadcasting Corp. of New Zealand), can be applied here while devoiding copyright protection to the taste of cheese due to the evolutionary nature of the taste, the possibility of staleness and the uncertainty surrounding similar reproduction of the same envisioned taste. However, the rationale given by the CJEU specifically requiring an objective perception and judgment is based on the false analogy with trademark law and can have grave implications upon copyright protection. This requirement implicitly requires fixation and graphic representation. The InfoSoc Directive of the EU mandates it to comply with Article 1-21 of the Berne Convention, which has not been done by such a determination of compulsive fixation. This is because the Berne Convention has specifically left the requirement of fixation, for autonomous states to determine in their legislations instead of making it a compulsory feature. This decision clearly overrules the applicability of copyright in the perfume, accorded by the Dutch court of appeals (LANCÔME) and consequently does away with the autonomy that has been prescribed in the Berne Convention, with respect to providing for a requirement of fixation of subject matter.

The point that a particular recipe has a particular taste attached to it has been ignored by the Court and the Court has focused on basing its analysis upon the possible subjective interpretations of this taste rather than on the factor of perception. The basic argument is that there is no objective determination possible even in the case of musical works or visual art as its interpretation solely depends on the percipient. A requirement of objectivity in interpretations and perceptions is uncalled for, as it results in delving into the qualitative aspects of the work, which is not permissible under copyright law. Mere perception is enough, and this has clearly been ignored by the court, resulting in a problematic rationale being adopted.

Further, as far as the argument of taste being functional and food being a functional element is concerned, Prof. Christopher Buccafusco (Benjamin N Cardozo law school, Yeshiva University) has rightly argued in his work that the notion of sight and audio as expressive and taste and smell as functional, is a flawed traditional dichotomy of sensation. There is small element of functionality present in any kind of work, be it sight, and sound based or taste. Ergo, this cannot be a reason to devoid protection to culinary arts which intend on expressing, through taste as a medium of perception, and generate an emotion (which need not be objective). A curated food dish, as has been argued by Prof. Buccafusco, represents a conversation between the chef and the diners in which tastes combine in a way of being delicious and meaningful at the same time, conveying a conceived expression. Hence a claim of functionality cannot be a reason to deny copyright, applying this sound rationale.

Implication on Countries with a Closed Copyright Regime like India and UK

The Berne Convention specifically allows for a broad and inclusive determination of categories of protectible expression. Although, it leaves it upon individual member states to autonomously decide upon the ambit of their copyright regime, it provides for such an inclusive provision to accommodate new forms of expression. India is a signatory to the Berne Convention however, it yet envisages a closed copyright regime, exercising upon its autonomy. With evolution in technology and consequent forms and modes of expression, it is imperative for the law to blend in and recognize the possibility of unconventional works coming into existence. Denying them protection merely because of an unconventional nature, will be against the fundamental tenet of copyright law. The WIPO guidelines clearly establish this tenet to be –  protection to any original intellectual creation which can be perceived. Even in the UK, due to the closed copyright regime, certain unconventional works like assembly of a scene (in the case of Creation Records) have been denied copyright which has led to criticism of the policy. Courts have even recognized the need for such opening up in the UK, to accommodate developing modes of expression not limited to conventional literary, musical and artistic works. Hence, although there are no immediate legal implications of this decision on countries like India, due to a closed copyright regime, but this decision recognizes the evolution of modes of expression and growing contours of law which is an essential policy implication to debate upon.

Image from here

We’re pleased to inform our readers that Inttl Advocare, one of India’s leading IP boutique law firms is looking to immediately hire lawyers for the position of Senior Associates in its Litigation team. For further details, please see the job description below:

Position

Senior Associate – Litigation

 Responsibilities

The selected candidate will be responsible for closely working with a team of IPR attorneys providing best in class services to clients of repute. Apart from drafting pleadings, notices/responses/oppositions, they will also brief Sr. Counsels and appear before Courts and other appropriate authorities.

Desired Joining Date  

At the earliest

Desired Qualification & Experience

LL.B. degree

Minimum 5 years of post-qualification experience (PQE) level in IP litigation, well-versed in all aspects of Litigation, Enforcement & Court related work.

Salary

As per experience and industry standards

Candidate Requirements

The candidates should be lawyers with 5-7 years of IPR experience in litigation with expert knowledge in Trademark, Copyrights and/or Patents; must possess excellent drafting and communication skills, maturity in dealing with Sr. Counsels and working under tight time schedules.

How to Apply

Interested candidates may send their application along with their CV to careers@inttladvocare.com with copy to mamta@inttladvocare.com.

I was a tad bit surprised to see Novartis move a patent application claiming a polymorph, without much evidence of its therapeutic superiority. Resulting in a rejection from the  Indian Patent Office. Here is what the Assistant Controller, Dr Archana Gupta states:

“The patent application no. 305/DELNP/2009 was filed on 14/01/2009 by the applicant entitled “Crystal Form of Epothilone B and use in Pharmaceutical Compositions”.

Objections:
1. Subject matter of the claims do not constitute an invention under section 2[1(j)] of the Indian Patents Act, 1970 because it does not involve novelty and inventive step in view of prior art cited documents listed below…

2. Claims 1-3 fall under section 3(d) of the Patents (Amended) Act, 2005 as the said claims defines new use and/or new form of the known compound. In the absence of experimental data, it is not clear if the claimed compound and the composition thereof act to provide an enhancement of the known efficacy i.e., demonstrate a greater technical effect and/or differ significantly in properties w.r.t the known compound.

ps: Thanks to Sandeep Rathod for bringing this to our attention.

pps: Image from here.

Here’s the round-up of the last fortnight of 2018!

Thematic Highlight

Prarthana wrote a post on Carlsberg Breweries v. Som Distilleries, in which a 5-judge bench of the Delhi High Court held that a composite suit for design infringement and passing off is maintainable, and further, a remedy for passing off for a registered design can be brought if the said design is not functioning as a trademark and if the remedy of passing off is claimed for trade dress infringement or any other similar infringement.

Topical Highlight

Prof. Basheer broke the news of Novartis’ attempt to obtain a patent for a polymorph, without evidence of its therapeutic efficacy. This application was rejected on the basis of Sections 3(d) and 3(e) of the Patents Act, 1970.

SpicyIP Jobs

Pankhuri informed us that Inttl Advocare, one of India’s leading IP boutique law firms, is looking to immediately hire lawyers for the position of Senior Associate in its Litigation team.

Other Posts

In a guest post, Akshat Agrawal wrote on a recent decision of the Court of Justice of the European Union pertaining to sensory copyrights. The thrust of the case rested on the interpretation of ‘work’ under Article 2(1) of the Berne Convention, which would determine whether the taste of a food product could be copyrighted. The Court concluded that there can be no copyright in taste due to its basis of identification being subjective sensations and experiences. Akshat notes that the outcome is correct, but identifies certain discrepancies in certain portions of the reasoning offered in the judgment.

Other Developments

Indian

Judgments

Sun Pharmaceuticals Industries Limited v. Brexsun Pharma Private Limited – Delhi High Court [December 13, 2018]

The Court granted a permanent injunction restraining the Defendant from using the mark “SUN” in infringing and passing off the Plaintiff’s identical mark in respect of sale of medicines. In arriving at this decision, the Court noted that the Defendant had no real prospect of defending the claim as it had completely engulfed the Plaintiff’s mark in adopting its mark. Moreover, it was noted that the Plaintiff was the registered proprietor of the mark “SUN”, and therefore the same could not be adopted by the Defendant.

M/s. Inter Ikea Systems BV v. M/s. Ikea Furnitures and Others – Delhi District Court [December 17, 2018]

The Court granted a permanent injunction restraining the Defendant from using the mark “IKEA” in infringing and passing off the Plaintiff’s identical mark in respect of the sale of medicines. The Court noted that the evidence adduced by the Plaintiff sufficiently proved that the Defendant had adopted the Plaintiff’s mark in its business. Moreover, it was stated that the Defendant’s intention to gain from the goodwill and reputation of the Plaintiff in the commercial space was very clear. Ultimately, the Court granted damages to the tune of Rupees 1 lakh in light of the unfair commercial advantage received by the Defendant in trading under the Plaintiff’s mark.

Ranvir Singh Bijnaria v. Ashok Kumar and Others – Delhi High Court [December 18, 2018]

The Court granted a permanent injunction restraining the Defendants from using the mark “EASY SLIM” in respect of its domain names in infringing and passing off the Plaintiff’s identical mark in respect of the sale of ayurvedic medicines. In arriving at this decision, the Court noted that the Plaintiff was the registered user of the mark, and the Defendants had committed clear infringement by using the Plaintiff’s registered mark to sell counterfeit goods.

Mahle Filter Systems India Private Limited v. Mobis India Limited and Another – Delhi High Court [December 20, 2018]

The dispute between the Parties arose on the Plaintiff’s claim of alleged infringement by the Defendant of its marks as the same would indicate a trade relationship between them. In light of First Information Reports being filed by the Defendant, the Plaintiff sought to obtain a declaration against the groundless threat. The Court noted that there was no threat of groundless infringement as the Plaintiff was selling spare parts pertaining to the Defendant’s manufactured vehicles in a packaging which contained the Defendant’s mark along with the phrases “genuine accessories of Elofic Industries Limited” and “suitable for Hyundai Accent”. Further, it was ordered by the Court that the Plaintiff should replace the aforementioned words in quotes with “adapted to form a part of” while simultaneously declaring that its products had no trade connection with the Defendant.

M/s. Parul Food Products v. M/s. Gurudev Industries – Delhi High Court [December 20, 2018]

The Court granted a permanent injunction restraining the Defendant from using the mark “FREEFUN” in infringing and passing off the Plaintiff’s similar mark “FUNFINE” in respect of the sale of confectionary goods. It was noted by the Court that the Plaintiff was the prior user and registered proprietor of the mark which had acquired reputation and goodwill across India. The Court stated that the Defendant was selling products bearing a deceptively similar mark to that of the Plaintiff and had no real prospect to defend its claim.

M/s. Avantika Elcon Private Limited v. M/s. Ajit Industries Private Limited – Delhi High Court [December 21, 2018]

The Plaintiff filed a suit on the ground that the Defendant had committed infringement in using the mark “AIPL MNTECH”, which was claimed to be deceptively similar to the Plaintiff’s mark “MNTECH AELCON”. In denying any relief to the Plaintiff, the Court noted that the Plaintiff had failed to disclose that the mark “MNTECH AELCON” actually belonged to a Korean company with whom it had entered into an agency agreement. The Court considered that in light of the gross suppression, the Plaintiff was liable to deposit a sum of Rupees 2 lakhs with the Court Advocates’ Welfare Trust.

D.B. Corporation Limited v. Dainik Divya Bhaskar and Another – Delhi High Court [December 21, 2018]

The Court granted a permanent injunction restraining the Defendant from using the mark “DAINIK BHASKAR” or “DIVYA BHASKAR” through their domain name in infringing and passing off the Plaintiff’s marks in respect of news services. It was noted by the Court that the Defendant’s use of the domain name had violated the statutory and common law rights of the Plaintiff. The Court considered the evidence of the Plaintiff and further noted that there was a clear case of infringement by the Defendant.

M/s. Psychotropic India Limited v. M/s. Syncom Healthcare Limited – Delhi District Court [December 22, 2018]

The Court granted a permanent injunction restraining the Defendant from using the mark “CTZ” in infringing and passing off the Plaintiff’s similar mark in respect of the sale of medicines. In arriving at the decision, the Court noted that the Defendant’s use of a deceptively similar mark was to encash on the goodwill and reputation of the Plaintiff. Moreover, it was noted that the Plaintiff had suffered immense losses due to the illegal activities of the Defendant and the grant of a permanent injunction was the appropriate remedy.

News

Comments / suggestions invited on Draft of “The Information Technology [Intermediary Guidelines (Amendment) Rules] 2018

MakeMyTrip takes 5 firms to court for using similar names

Transfer of Patent Rights assessable under CST Act: Kerala HC

Patent Applications By Female Innovators To Get Faster Clearance

Strategic transformation is the need for much greater support for AYUSH

Andhra Pradesh loses Araku GI tag to Coffee Board of India

‘Art is in the most deplorable condition in India’ craftsmen struggle to continue traditional Jaipur blue pottery

Advertisement is a facet of Commercial Speech protected under Article 19(1)(a): Delhi HC

International

GSK awarded Arrow declaration in patent dispute with Vectura

Motorola Solutions alleges Hytera Communications copied its source code

Mohit Suri, Mithoon allege T-Pain’s latest song That’s Yo Money is copied from Aashiqui 2’s Tum Hi Ho

IP tribunal rules Murugappa’s BSA trademark well-known, asks Malaysia firm to remove similar one

Disney moving to get a wider trademark on the Swahili phrase is being seen as cultural appropriation

In a judgment delivered on December 21, 2018 a judge of the Uttarakhand High Court ruled that Divya Pharmacy, an Indian company that manufactures Ayurvedic medicines, will be subject to the benefit sharing obligations under the Biological Diversity Act. As a result, Divya Pharmacy will be required to make payments to the Uttarakhand State Biodiversity Board as per the rates laid down in the Access and Benefit Sharing Guidelines, 2014.

Like many other Indian companies, Divya Pharmacy had taken the position that only foreign companies and their Indian subsidiaries were required to take “approval” from the National Biodiversity Authority (NBA), as per Section 3, before accessing any biological resources for the purpose of commercial utilization. And it is during this approval process that the NBA could impose certain benefit sharing obligations. For Indian companies, Divya Pharmacy argued that Section 7 only required “intimation” to be provided to the State Biodiversity Board (SBB) which can then restrict certain activities if harmful. The SBB, does not, on a plain reading of the law have any power to impose benefit sharing requirements on Indian companies. The difference in the phrases used for foreign companies and Indian companies and the scheme of the legislation makes it quite clear that foreign companies and Indian companies are treated differently by the law.

The Uttarakhand High Court concedes that on a literal reading of the statute, Divya Pharmacy has a strong case but then claims that this would lead to an absurd legal outcome where only foreign companies would have to pay for accessing Indian biological resources. If a court can establish that a literal interpretation leads to an absurd outcome it can give the legislation a purposive interpretation, meaning an interpretation that honors the legislative intent of Parliament rather than the text of a particular clause. It is often a convenient device for activist judges to ignore the parliamentary mandate.

The problem with this line of argument that is accepted by the Uttarakhand High Court, is that there is nothing absurd about an Indian legislation discriminating between foreign and domestic company. Indian economic policy has always been protectionist and Indian companies have been given protections and privileges by the Indian Parliament which have not been made available to foreigner competitors. The debate behind the Convention on Biological Diversity and the subsequent enactment of the Biological Diversity Act was very much on nationalistic lines. Developing countries who were being forced to adopt America’s TRIPS agenda basically attempted to strike back by signing the Convention on Biological Diversity (CBD) which for the first time recognized the national sovereignty of nations over their biological resources. I”ve explained a bit of history in an earlier post here. It was therefore no surprise that Parliament exercised its sovereignty to treat foreign and Indian companies very differently when it came to accessing Indian biological resources. On other issues such as potential patenting activity for research conducted on biological resources, the law treats both foreign and Indian companies equally. Section 6 is crystal clear that no person shall apply for any IP rights in India or abroad without the permission of the NBA. This means that Indian companies have to get permission in the same manner as their foreign counterparts. If Parliament was smart enough to treat foreign and Indian companies on the same plane for IP rights, it follows that Parliament was aware it was treating Indian and foreign companies differently when it used the phrase ‘approval’ in Section 3 and ‘intimation’ in Section 7. There are several other provisions in the legislation which support this interpretation.

The Uttarakhand High Court’s decision has predictably attracted very favorable press because it puts Baba Ramdev’s companies in the dock. Most of India’s self-labeled liberal do not like Bab Ramdev. The fact however is that this judgment is going to apply across the board to a number of small and medium Indian companies who carry out similar businesses and who will now have their business models impacted.

Both, the judgment and the favourable reportage around it appear to be under the impression that the money collected from Divya Pharmacy will go to the tribals of Uttarakhand. That is not necessarily true since the money collected under the ABS guidelines goes into a fund that is supposed to be used for conservation activities. Only if the company is using traditional knowledge associated with the biological resources can the NBA, not the SBB, make a determination of equitable benefit sharing after a claim is presented to it. The tribals do not get any money otherwise.

With reference to the right of tribals, the Uttarakhand High Court makes the following grand statement:

“The local and the indigenous communities in Uttarakhand, who reside in the high Himalayas and are mainly tribals, are the traditional “pickers” of this biological resource. Through ages, this knowledge is preserved and passed on to the next generation. The knowledge as to when, and in which season to find the herb, its character, the distinct qualities, the smell, the colour, are all part of this traditional knowledge. This knowledge, may not strictly qualify as an intellectual property right of these communities, but nevertheless is a “property right”, now recognised for the first time by the 2002 Act, as FEBS.”

FEBS or fair & equitable benefit sharing is not a property right. The Biological Diversity does not create a property right in favour of any communities. Rather it treats the NBA as the benevolent parens patriae which can dole out money to the communities claiming to assert some ambiguous right under equity related to their traditional knowledge. Even presuming there is a property right in the traditional knowledge. Is the “property” owned by an entire community? What if one of the members of a tribe or community wants to share the knowledge without the consent of the other members of the community? What happens then?

This judgment of the Uttarakhand High Court is unlikely to stand scrutiny on appeal and is going to attract a fierce backlash from Indian industry.