Intellectual property is the key to the growth of India’s knowledge economy. The Indian IP industry has evolved in leaps and bounds and is fast to reach new heights. With the emergence of the modern knowledge economy, it will have to reform the old and some of the current management constructs and approaches.

India has a well-established legal framework for creating an efficient environment for intellectual property (IP). The government has taken several initiatives, based on feedback from stakeholders, to create awareness and instill a culture of innovation in India. Throughout the previous years, the IP offices have been dramatically changed through various initiatives, which have made a huge difference to understanding IP and to make the patenting system more user-friendly. Some of the developments which occurred recently in 2018 and 2019 are discussed here.

DEVELOPMENTS IN 2018

Ø CASE LAWS

1.      The first ever fast track trial decision on Standard Essential Patent (SEP).

The hon’ble Delhi High Court rendered a judgment in favor of Philips on consolidated issues on 12 July 2018, in the case of Koninklijke Philips Electronics N.V. v. Rajesh Bansal & Ors.,[1] and Koninklijke Philips Electronics N.V. & Ors. v. Bhagirathi[2]. The defendants were found liable, following a long trial, for violation of Philips’ Standard Essential Patent (SEP). The Defendants were called upon to pay damages, and one of the Defendants was also directed to pay punitive damages.

Facts- Phillips had filed two proceedings against the defendant, K.S. Negi, Manglam Technology in one suit; and Bhagirathi Electronics, Big Bazar and Home Solutions Retail (India) Limited in another, for infringement of their essential patent on DVD Video Player, seeking reliefs of permanent injunction, instructions to the defendant to provide complete details about the delivery, accounts return, damages, etc.

Decision- The complainant’s claim to the whole patent pool in the DVD player cannot be assumed to be unreasonable even though the argument in the suit patent is limited to the decoding unit, since the same is an essential part of the DVD player and without which the DVD player cannot work. Since the alleged patent expired on 12 February 2015, it was not necessary to issue a permanent injunction. Additionally, the court found that one of the defendants was an ex-employee in Philips and was well aware of the suit patent and still infringed the same. Therefore, the defendant was ordered to compensate the complainant Rs.500,000  as punitive damages.

2.      No seizure of imported products which infringes the patent

With the implementation of the Intellectual Property Rights (Imported Goods) Enforcement Amendment Rules, 2018, the government has expressly removed the seizure of any imported goods that infringes a patent from the act. In a case involving dual SIM technology, the standard authority recognizing the difficulty of such commitment made this judgment which had previously been the focus of considerable discussion. The revised laws now apply to trademarks, copyright, Design and Geographical Indications.    

3.      Single color trademark dilemma

Although, Christian Louboutin had a favorable ruling from the European Court of Justice (ECJ), in related situations, the Delhi High Court rejected his assertion of exclusivity in red color for shoe sole on the basis that protection as a trademark cannot be given for a single color. The decision came in the form of a patent infringement lawsuit and passing off brought by Christian Louboutin against a party based in Mumbai, named Abubaker & Ors., who sold ladies footwear with identical red soles.[3] Interestingly, in comparison to a previous ruling by a Delhi High Court judge declaring Christian Louboutin’s ‘hot sole’ to be a well-known trademark.

DEVELOPMENTS IN 2019

Ø CASE LAWS

1)      Introduction of Dynamic Injunction

The aim is to help the right holder to avoid filing a fresh suit through the cumbersome process. The right holder can simply approach the Delhi High Court Joint Registrar with appropriate evidence documents and extend the existing injunction to the website which publishes the same infringement content. Until recently, the right holder had to lodge a fresh claim or probably use a John Doe order/ injunction by adding the party to the current suit.

The Delhi High Court has made a significant contribution to the jurisprudence in India through its judgment in UTV Software Communication Ltd. and Ors. v. 1337X to and Ors.[5], delivered on April 10, by creating a new remedy of a ‘dynamic injunction,’ whereby rights-holders do not need to go through the ‘cumbersome’ process of a judicial order to issue blocking orders to ISPs. Instead, as set out in this ruling, the complainants were allowed to approach the Delhi High Court Joint Registrar (an administrative position), to extend an injunction order already granted against a website, against a similar ‘mirror/redirect’ website containing the same content as the original website.

Facts- The plaintiffs, including UTV Software Communications Ltd., are ‘creating material, producing and distributing films worldwide, particularly in India’. The defendants are, among others, thirty named websites, along with John Doe defendants, the Ministry of Electronics and Information Technology, the Telecom Department and numerous ISPs.

Decision- Though Indian law does not allow for a ‘dynamic injunction,’ the Court claimed that the same may be given to fulfill the ends of justice and resolve the threat of piracy.

In this case the Delhi High Court agreed that the ‘dynamic injunction’ is rooted in the Singapore law provisions. However, the court held that there are other provisions in the Indian Civil Procedure Code to carry out a remedy of a similar nature.

2)      Infringement of copyright after submitting a patent application

In the case of Steer Engineering Private Limited v. Glaxosmithkline Consumer Healthcare Holdings (US) LLC and Ors.[6]

Facts– In this case, the Appellant is an Innovator Company which develops various technologies, including the extrusion process technology. The Appellant had entered into a Master Services Agreement (MSA) with the Defendants for the transfer of the extrusion process technology to be used in the manufacture of the iconic nutritious food powder, Horlicks. Having received the right to patent the technology by virtue of the MSA, the Defendants submitted all the test results and data provided to them by the Appellant for an international patent application. The appellant alleged that the patent application of Defendants infringed their copyright, as it revealed various confidential test results and data. The Defendants claimed that the MSA granted them the power of all the details and IP that was collected from the parties for the purposes of the project.

Decision– The Court noted that there was no patent infringement because the Appellant had failed to produce the original test result and the text that was provided was a redacted one. Furthermore, at the time of the transfer under the MSA, the appellant had failed to prove the nature of the confidentiality of such information and was therefore unable to claim violation.

3)      Mere silence is no acquiesce

Acquiescence is a species of estoppels, a rule of inquiry and a rule of evidence and it is essential for the Doctrine of Acquiescence that it is accompanied by encouragement or incitement, whoever possesses a legal right must have encouraged the alleged violator of that right to the detriment of the latter, confident that the former does not assert his rights against the violator.

In a recent case of Make My Trip (India) Private Ltd. v. Make My Travel (India) Private Ltd.[7], the Delhi High Court granted a “temporary ad-interim injunction” in favor of Make My Trip (India) Private Limited in a case of trademark infringement. This case is important as it upholds the principles that mere silence or non-intervention is not an approval. In order to be accepted as a defense positive encouragement on the part of the victim must also be proved.

Facts- In the present case, the plaintiff sought a permanent injunction restricting the defendant from adopting and utilizing the name Make My Travel, MMT (letter mark) and the ‘Dreams Unlimited’ tag line. The plaintiff used the MakeMyTrip and MMT brands, the MakeMyTrip Term Mark as well as the MMT letter mark constantly and uninterruptedly. The plaintiff has also used Tag Line ‘Memories Unlimited’ and ‘Hotels Unlimited’ constantly and without interruption. The plaintiff’s argument is that he has a presence in India and many other countries worldwide. Therefore, aggrieved by the adoption and usage of the Infringing Mark and Infringing Domain Name, the Plaintiff issued a notice of cease and removal of the Defendant, inter alia, to cease the use of the Infringing Marks and Infringing Domain Name, via his Lawyers.

Decisions- In favor of the appellant, the Court decision found that the word marks used by the defendant were similar and deceptively identical in nature, concept and idea, and is apparent by the usage of the words in a specific combination. It also stated that taking into consideration all companies offering identical service, the defendant is thus, responsible for infringing the trade mark of Plaintiff. Reference was made to the case of F. Hoffman La Roche v. Geofferey Manners, (1969) 2 SCC 716, where the Supreme Court held that- “True test is whether the totality of the proposed trademark is such that it is likely to cause disillusion or confusion or mistake in the minds of persons accustomed to the existing mark.” The Court stated that the plaintiff has a strong prima facie case, and that the balance of convenience is also in his favor. In case, the defendant is permitted to proceed to use unlawful signs, then severe and significant damage is likely to be done to the claimant.

4)      In-chamber proceedings to safeguard sensitive information

The Bombay High Court issued a notice ordering hearing ‘in-chamber’ for urgent applications requesting ex-parte orders in cases pertaining to intellectual property rights. This change is seen as one which is likely to prevent the leaking of information related to these cases. These cases will not be listed in open court and their number will not be posted to the HC website. This is meant to fulfill the original purpose of ‘maintaining secrecy’.[8]

In a similar case, in Johnson & Johnson v. Ashok Kumar/ John Doe & Anr.[9], the Delhi High Court’s Justice Rajiv Sahai Endlaw, passed an ex-parte order in-chamber as the defendant Pritamdas Arora dealing as M/s Medserve falsely dealt in counterfeit goods under the mark SURGICEL and the house mark ETHICON of the plaintiff in the United States. The case was alleged to have already been filed in the US court. To restrain the defendant from dealing with the mark and seizing his goods in India, both the plaintiff and the defendant’s name was sought in the Judge’s chamber.

Ø GOVERNMENT INITIATIVES

1.      Draft Guidelines for use of Geographical Indication Logo and Tagline   

A geographical indication (GI) is a sign used on products having a particular geographical origin and having qualities or a reputation due to that origin. A sign may identify a product as originating at a given location in order to act as a GI. Therefore, the product’s qualities, characteristics or reputation would be attributed in part to the place of origin. Since the characteristics depend on the geographic area of production, a direct connection exists between the product and its original place of production.[10]

In order to encourage and promote Indian products registered as Geographical Indications, the Department for the Promotion of Industry and External Trade has introduced a common GI logo and Tagline. The GI logo would serve as a certifying mark that can be used to identify all Indian products registered as GIs, regardless of divisions, making it easier for customers to recognize authentic GI products, while securing genuine GI producers’ interests. However, draft guidelines have been prepared to ensure the correct usage of the GI Logo and Tagline.[11]

2.      Govt. Approves Highway Patent Prosecution Highway (PPH): Steps to speed up Patent Examination in India

Vide notification dated 20 November 2019; the Union Government affirmed a proposal for the Indian Patent Office adoption of the Patent Prosecution Highway (PPH) program in cooperation with the Patent Office of different countries. The Indian Patent Office may only receive patent applications under this pilot program in certain specified technical fields, namely electrical, electronics, computer science, information technology, automobiles and metallurgy it said. The PP program will result in benefits for the office of the Indian IP, including a decrease in the time required to file patent applications and a decrease in the pendency of patent applications. This will lead to an improvement in the quality of patent searches and examinations.[12]

3.      DRDO provides unrestricted and free access to patents to improve local production

The Indian Defense Research Development Organization (DRDO) has introduced a new policy to help the organization to have complete access to its patents filed in India without any license or royalty payments. With the aim of “providing a boost to Indian industries and defense industries by free access to Indian patents,” the patent portfolio of DRDO, which contains over 450 patents, will be open to the public for use without any licensing or royalty fees. In addition to the new policy, DRDO also published a notice setting out the procedure for using DRDO patents. According to the notification, a licensing application must be made via the DRDO website and a processing fee must be paid of Rs 1000. The DRDO policy called for the effective, efficient and ethical management of intellectual property rights to obtain full economic potential and recognize opportunities for the commercial exploitation of IP and the creation of wealth.[13]

4.      The Government makes significant changes in the Manual of Patent Office Practice and Procedure (2019)

A New Manual of Patent Office Practices and Procedures was created by the Union Government with its notification. This new manual attempts to accommodate various developments such as the automation and digitalization of the process. This latest document further aims to enhance the transparency of the functioning of the Patent Office. This new manual is a welcome step towards simplifying the procedures by bringing greater clarity, transparency in the payment process and enabling the process to be digitized.[14]

Ø LEGISLATIVE INITIATIVE

1.      The Cinematograph (Amendment) Bill, 2019

In order to control piracy, a significant amendment to reform the new Cinematographic Act, 1952, was made. After approval by the cabinet of the Union, the Bill is undergoing a consultation process with stakeholders before being introduced in both the houses of parliament for debate. The latest amendment takes note of advancements in technology making film piracy rampant in the usage of audio-video recording equipment. The amendment makes Movie Piracy offenses punishable up to three years of imprisonment, and fines that may extend to 10 lakh or both. It proposes mandating the same penalty for even attempting or encouraging the same.[15]

Ideally, anti-piracy legislation would be aimed at stopping commercial-scale misuse of rights, but the law criminalizes disproportionately the mere act of producing a copy of a film or some part thereof, like creating a short video on your phone for any reason.

By overriding the provisions of the Copyright Act, the amendment fails to take into consideration the right to fair dealing provided under Section 52 of the Copyright Act and which covers some non-permissoned uses of copyrighted works, such as for personal usage or criticism or review. That is a vital aspect of the balance that the Copyright Act aims to maintain between securing rights and increasing access to knowledge and artistic works, and the Cinematograph Act’s draft amendment flagrantly undermines all such balance, criminalizing acts as benign as recording and sending a short clip of a film to a WhatsApp friend. Also, the penalties proposed in the draft amendment are blunt and disproportionate.[16]

2.      The Copyright (Amendment) Rules, 2019 

The amendments are being introduced to put the Copyright Act into compliance with other relevant laws and to ensure that it remains in sync with the technical developments of the digital age. The proposal is to substitute the term ‘every radio and television broadcasting’ reference in Copyright Act, 2013, with ‘every broadcasting mode’.

In the case of Tips Industry v. Wynk Music[17], the Bombay High Court held that Internet broadcasting is not covered by the statutory licensing scheme under Section 31D of the Copyright Act. In the opinion of the Court, its view is supported by Rules 29 and 31 of the Copyright Rules which provide for the issuing of notices and the determination of royalties (respectively) only with respect to radio and television broadcasting.

The proposed reform is considered by the Government as a clarification that the statutory licensing system under Section 31D extends to all forms of broadcasting including internet broadcasting and is not restricted to radio and internet broadcasting only.

3.      New Patent Rules

According to the new Rules, the originals will be submitted by the Patent Agent only if the Patent Office so requests. The originals duly authenticated shall be submitted within 15 days of receipt of such a request. No transmitting fee to be charged by the applicant while filing PCT applications. There are no fees for preparing certified copies of the priority document and e-transmission through WIPO-DAS. The new Regulations allow only electronic filing of all the records to digitize the operations and is a step towards the paperless workplace. Moreover, the requirements for filing requests for the expedited examination have been applied to small entity applicants; female applicants and applicants qualified under a patent application pursuant to an agreement with an Indian Patent Office and a foreign patent office. The new rules also provide various government entities that will benefit from the expedited examination.[18]

4.      Amendment to Form 27: Statement on working of Patents

While the current form calls for extensive information on the function of patent holders and their licensees, the proposed amended version dispenses with a lot of this information, including the quantity of the patented product manufactured in India or imported in India, country wise details of the worth and quantity of the patented product imported into India, etc. The revised Form also imposes a 500-word arbitrary word limit for the statement of justification for not working the patent.[19]

CONCLUSION

There has been a considerable initiative taken by the government, the legislature and the judiciary. With the Indian judiciary exhibiting enthusiasm for and dedication to upholding IP rights, IP owners have been more vigilant in defending their rights by all means. Though the benefits of specialized IP courts are still under consideration in India. Although more needs to be done in regards to the criminal justice system, the Indian civil system is changing everyday for the protection of IP rights. While recent substantial advances have reaped considerable rewards for IP owners in India, there is still a long way ahead.