Marcus Evans conference Corporate Legal Counsel Forum Roadmap

Marcus Evans conference: Corporate Legal Counsel Forum Roadmap for Intellectual Property Rights protection in the globalised world Taj Lands End, Mumbai 24 th – 25 th May 2007 Karnika Seth Attorney at law & Partner SETH ASSOCIATES ADVOCATES AND LEGAL CONSULTANTS © Seth Associates, 2007 All Rights Reserved

Presentation plan § Discovering ways to manage and protect a company’s IP § Discussing the legal and practical issues on IP law in India § Recent case laws on IP and their implications § Protecting trademarks, copyright & patents in India § Expounding copy rights challenges in digital age § Understanding the role of legal due diligence in digital rights management and asset protection § Understanding how the New Companies Bill 2006 interferes with e-governance © Seth Associates, 2007 All Rights Reserved

Discovering ways to manage and protect a company’s IP § What is IP ? Output of intellect having commercial importance/value § Intangible assets of a company-trademarks, patents, copyrights , etc § Why manage or protect IP? Requires huge investment of time and money and § § § § § can be exploited by commercialization Few characteristics. IPR can be held by legal entities/individuals IPRs can be simultaneously held in same IP in many countries at the same time Non working can prove fatal Territorial right except Copyright (as per Berne Convention. ) Fixed term rights except trademark and geographical indication How to manage IP? IPR can be assigned, gifted and licensed, mortgaged Sign non disclosure, confidentiality agreements with employees/investors/service providers How to protect IP? By and large , statutory registration necessary for protection. Enforce IP rights incase of infringements through legal redress © Seth Associates, 2007 All Rights Reserved

Trademark & domain names Copyright Trade secrets Patent Categories of IP rights Utility model/Designs Geographical Indications Plant Breeder’s rights © Seth Associates, 2007 All Rights Reserved

Classification of IPR Intellectual Property IPR Trademarks Broadcasting Copyright Patents Music Dramatics Works Literature Sound Recording Industrial Design Works of Art Geographical Indications Computer Programs © Seth Associates, 2007 All Rights Reserved

Reasons Why IP is Ignored Under estimation of its importance Lack of Awareness Time Required for Grant of a Patent/registration of TM Myth that it can’t be computed /valued Cost of Patenting Enforcement of IPR © Seth Associates, 2007 All Rights Reserved

Rights that different IP assets protect § Intellectual Property can be clearly distinguished from Goodwill. UK & Australian Generally Accepted Accounting Principles (GAAP) has specified goodwill as an umbrella concept consisting of unidentifiable intangible assets and should not include those Intellectual Properties which are capable of individual identification and can be sold separately. § Copyright- is a bundle of rights granted to an author of an original artistic, literary or musical work to print , publish and sell copies of his work and other allied rights. Copyright protection also extends to cinematographic film and sound recordings. § Designs- The designs entitled to protection are new and original designs having aesthetic value which have not been previously known or published in India or elsewhere. © Seth Associates, 2007 All Rights Reserved

Rights that different IP assets protect (Cond. ) § Trademarks- is an identification symbol which may be a word, a device, a label or numeral etc. or a combination thereof used in the course of trade that enables the purchasing public to distinguish one trader’s goods from similar goods of other traders § ( distinctive/acquired distinctiveness) § The purpose of Brand is: • To uniquely identify a company and its product. • To differentiate them from competitor. • To enhance the perceived value, the quality and satisfaction that a customer experiences. • To evoke distinct associate stands for certain personality traits and carries emotional attachment. • Above all brand is supposed to inspire trust. Trust failure can lead to brand failure and brand failure can be fatal. § Patents- is the grant of a monopoly right to an inventor who has used his skill to invent something new. (novelty, non obviousness, usefulness) © Seth Associates, 2007 All Rights Reserved

World's three most valuable trademarks! § 1992 Financial Week listed, as the world's three most valuable trade marks, § "Marlboro", worth 31 billion US dollars, § "Coca-Cola", worth 24 billion US dollars, § and "Budweiser", worth 10. 2 billion US dollars. © Seth Associates, 2007 All Rights Reserved

Global IP protection International Organizations § World Intellectual Property Organisation (WIPO) § WIPO was established by the WIPO Convention in 1967 with a mandate from its Member States (184)to promote the protection of IP throughout the world through cooperation among states and in collaboration with other international organizations. Its headquarters are in Geneva, Switzerland § International Association for the Protection of Industrial Property (AIPPI) AIPPI The World's leading non-government organisation for research into, and formulation of policy for, the law relating to the protection of intellectual property § International Trademark Association (INTA) The International Trademark Association (INTA) is a not-for-profit membership association of more than 5, 000 trademark owners and professionals, from more than 190 countries, dedicated to the support and advancement of trademarks and related intellectual property as elements of fair and effective national and international commerce. The Association was founded in 1878 © Seth Associates, 2007 All Rights Reserved

International Organizations § European Patent Office -The European Patent Organisation is an intergovernmental organisation that was set up on 7 October 1977 on the basis of the European Patent Convention (EPC) signed in Munich in 1973. It has two bodies, the European Patent Office and the Administrative Council, which supervises the Office's activities. The Organisation currently has 32 member states. § The WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), negotiated in the 1986 -94 Uruguay Round, introduced intellectual property rules into the multilateral trading system for the first time. The TRIPS Agreement, which came into effect on 1 January 1995, is to date the most comprehensive multilateral agreement on intellectual property © Seth Associates, 2007 All Rights Reserved

WIPO administered IP protection treaties § Conventions Topic Year No. Contracting parties . Berne Convention Copyright 1886 163 Brussels Convention broadcasting 1974 30 Film Register Treaty Copyright 1989 13 Madrid Agreement Indications of Source) 1891 35 Nairobi Treaty Olympic symbol 1981 46 Paris Convention Industrial property 1883 171 Patent Law Treaty patent 2000 14 Phonograms Convention phonograms 1971 76 Rome Convention copyright 1961 86 Singapore Treaty on the Law of Trademarks trademark 2006 not yet in force Trademark Law Treaty trademark 19994 38 Washington Treaty Integrated circuits 1989 not yet in force WCT Copyright 1996 63 WPPT phonograms 1996 61 © Seth Associates, 2007 All Rights Reserved

WIPO administered IP protection treaties Global Protection System Conventions Topic Year No. Contracting parties Budapest Treaty Microorganism. Patent 1977 67 Hague Agreement Industrial design 1925 47 Lisbon Agreement GI 1958 26 Madrid Agreement (Marks) trademark 1891 57 Madrid Protocol trademark 1989 72 PCT patent 1970 137 Classification Conventions Topic Year No. Contracting parties Locarno Agreement Industrial design 1968 49 Nice Agreement trademark 1957 80 Strasbourg Agreement patent 1971 57 Vienna Agreement Figurative mark 1973 23 © Seth Associates, 2007 All Rights Reserved

Different Statutes governing IPR in India Trade Marks The Trade Marks Act, 1999 Patents The Patents Act, 1970 Copyright The Copyright Act, 1957 Designs The Designs Act, 2000 Geographical Indications The Geographical Indications Of Goods Act, 1999 Plant Varieties The Protection of plant varieties and Farmers’ Right Act, 2001 Semi conductor IC layout design Act, 2000 © Seth Associates, 2007 All Rights Reserved

IP- Duration of Term of Protection § § § Patents (20 years) Trademarks (10 years + renewals) Copyrights in published literary, dramatic, musical, and artistic works (Lifetime of author +60 years). Copyright in photographs , cinematographic film, sound recordings –(60 years from year in which it was published) Broadcast reproduction right-(25 years from the beginning of the calendar year next following the year in which the broadcast is made. ) § Performers right-(25 years from the beginning of the calendar year next § § following the year in which the performance is made) Industrial designs (10 years+ renewal permitted once for 5 years ) Trade-secrets and know how collectively “proprietary technology” (contract period-protected by contract provisions, doctrine of breach of trust) © Seth Associates, 2007 All Rights Reserved

Management of IPR assets Source: Commercialization of Intellectual property Rights, Informedia conference held in Bangalore, on . 28 Nov 2006 © Seth Associates, 2007 All Rights Reserved

Management of IPR assets Source: Commercialization of Intellectual property Rights, Informedia conference held in Bangalore, . on 28 Nov 2006 © Seth Associates, 2007 All Rights Reserved

Source: Commercialization of Intellectual property Rights, Informedia conference held in Bangalore on . 28 Nov 2006 © Seth Associates, 2007 All Rights Reserved

Practical tips for IP owners § Secure your rights § Invest in investigations § Stringent and watertight agreements § Timely actions § clear enforcement strategy © Seth Associates, 2007 All Rights Reserved

Discussing the legal and practical issues on IP law in India Recent amendments made in IP law of India § New Trade Mark Law (effective from September 15, 2003) § The new legislation is in compliance with the TRIPS agreement and contains important provisions which have been widely welcomed by IP owners and practitioners. Service marks have been introduced and it is now possible to obtain registration for service marks in India. § Well known marks defined and broader protection given: § The new Act has laid down criteria for well known marks and provided broad protection in respect of them. It has also recognized theory of dilution in respect of well known marks. Well known marks are given statutory protection, even when the allegedly infringing mark is being used on goods that are dissimilar to those for which the mark is registered. © Seth Associates, 2007 All Rights Reserved

Recent amendments in Indian Trademark law § Infringement redefined § The scope of infringement has been widened. One of the important changes has been to make it clear that use of a registered trade mark as part of a company name/business name will constitute trade mark infringement. This is quite useful for IP owners since, with the growth of the service industry in the last 10 years, there has been a growing tendency for infringers to adopt well known marks as part of their trade name/trading style. § Further use of marks, or deceptively similar marks, on similar goods (or even, in some circumstances, on dissimilar goods) may now amount to infringement. § Enforcement streamlined § Misuse of a trade mark has been made a cognizable and non bailable offence. Powers have been given to police officers to search and seize premises in case of trade mark infringement. The police officer is, however, required to obtain the opinion of the Trade Marks Registrar on infringement of the trade mark. © Seth Associates, 2007 All Rights Reserved

Recent amendments in Indian Trademark law § Jurisdiction further stretched § Jurisdiction under the 1958 Act was invoked where the defendant had its offices for gain or profits or where the infringing activities were conducted. The 1999 Act has extended the scope of jurisdiction by allowing the plaintiff to institute proceedings where the plaintiff has its office for profit or gain so as to render the provisions of jurisdiction under the Trade Marks Act on a par with those under the Copyright Act. From a brand management perspective, this is again a major milestone, as it enables the plaintiff to institute proceedings at the jurisdiction of its convenience and location as opposed to the physical discomfort of bringing proceedings where the defendant resides or infringes. § The 1999 Act allows assignments of pending applications without goodwill. © Seth Associates, 2007 All Rights Reserved

Recent amendments in Indian Patent Act § Patent Law amended § Amendments to the Patents Act have been the subject of intense debate, particularly those relating to the grant of pharmaceutical product patents. The Patent Law despite controversies and lobbying for and against finally saw light of the day on January 1, 2005 in compliance of India’s obligations as a WTO member. The act has been amended and product patent in relation to pharmaceutical products can now be registered in India. © Seth Associates, 2007 All Rights Reserved

Recent amendments in Indian Copyright law § Copyright Protection § The copyright law in India is largely TRIPS compliant. Major changes were made to the Indian Copyright Act in June 1994, coming into effect in May 1995. The amendments to the Act were a landmark in the copyright industry. The much required protection was given to computer software, clarifying the rights of the user to make backup copies and imposing heavy punishment and fines on infringers of software copyright. The Act is once again proposed to be amended in order to address challenges posed by digital environment in particular downloading of music, movies, books, software and other copyrighted material from the internet. The proposed amendments are awaiting approval from the parliament. The amendments would provide room for stricter Copyright law provisions in line with international standards. © Seth Associates, 2007 All Rights Reserved

Discussing the legal and practical issues on IP law in India Existing Hurdles to clear…. . § Procedure of registration is lengthy , cumbersome and costly especially patents. § Copyright violations and trademark violations other infringements of IPR rampant despite law and enforcement machinery in placeprocedures are lengthy, cost intensive, need of cohesion , police protection necessary for raids, Court injunction required, litigation delays. ( piracy in software, media and books maximum) § The Madrid system for the international registration of marks, also conveniently known as the 'Madrid system', is the primary international system for facilitating registration of trademarks in multiple jurisdictions around the world. India is in process of making amendments to its tradelaw regime to streamline its trademark law and to make it consistent with evolving international trademark law regime and is also contemplating accession to the Madrid System. © Seth Associates, 2007 All Rights Reserved

Existing Hurdles to clear… § India is not currently in compliance with TRIPS on a number of issues including business methods, but, it is hoped, they will move in that direction. "The Indian law … adds an exclusion that precludes patents on business methods, which have been the basis of significant recent filings in the United States. " Fortunately, there is a strong indication that India’s emerging technology community will positively affect compliance with TRIPS. Ironically, with an emerging software industry and the prevalence of the English language, India could benefit tremendously from an expansion of patentable subject matter to include business methods. © Seth Associates, 2007 All Rights Reserved

Recent case laws on IP and their implications § Spill over reputation and well known marks § Until the 1999 Act was enforced, the 1958 Act dealt with reputation and goodwill in a mark as a basis for restraining the use of an identical or deceptively similar mark for identical or similar goods. In the case of foreign plaintiffs whose marks did not enjoy direct use in India, spill over reputation was adequately recognized by the courts and there are several judgments including those in N R Dongre v Whirlpool Corp 1996 PTC 476, Caterpillar Inc v Mehtab Ahmad 2002 CTMR 354 Delhi, Alfred Dunhill v Kartar Singh Makkar 1999 PTC 294 and Kamal Trading Company v Gillette 1988 PTC 1 where the foreign plaintiff's mark was protected against dishonest adoption in India through the demonstration of international use and reputation in a manner which could have resulted in the foreign mark acquiring reputation and goodwill in India. © Seth Associates, 2007 All Rights Reserved

Recent Ruling-Protection of colour marks § The 1999 Act includes the combination of colours and shapes in the definition of trade marks. In a recent landmark decision in the case of Colgate Palmolive Company & Another v Anchor Health and Beauty Care Pvt Ltd, 2003 (27) PTC 478 (Delhi), the colour combination of red and white of the plaintiff's company has recently been protected against the defendant. It was stated that if the first glance of the article without going into the minute details of colour combination and get up appearing on the container and packaging gives the impression of deception or close similarities in respect of these ingredients, it is a case of confusion and amounts to passing off of one's goods as those of the other with a view to benefiting from the goodwill and reputation of the latter. § The defendants were restrained from using the colour combination of red and white on the containers and packaging of their goods, as there was every likelihood of confusion as to the source on account of the similarity of a substantial portion of the container having a particular colour combination and also the shape of the container. © Seth Associates, 2007 All Rights Reserved

Evasive Tactics In Infringement Checked With Punitive Damages § The Delhi High Court in the case of Asian Paints (India) Ltd. V Balaji Paints & Chemicals & Ors 2006 (33) PTC 683 (Del), reflects the current position as it has taken a strong view, that defendants who choose to stay away from proceedings of the court purely to escape damages should be burdened with the punitive damages, because on top of the impugned issue defendant’s action impinges on the reputation of the plaintiff. § Reinforced with the principles formulated in the recent judgment of Hero Honda Motors Ltd. V Shree Assuramji Scooters, 2006 (32) PTC 117 (Del. ), the Court quantified and awarded the damages of Rs. Three Lakhs for choosing to stay away from the proceedings of the Court despite service. © Seth Associates, 2007 All Rights Reserved

Landmark case fighting Biopiracy § India has won a 10 -year-long battle at the European Patent Office (EPO) against a patent granted on an anti-fungal product, derived from neem. EPO initially granted the patent to the US Department of Agriculture and multinational WR Grace in 1995. § But the Indian government successfully argued that the medicinal neem tree is part of traditional Indian knowledge. § The winning challenge comes after years of campaigning and legal efforts against so-called "bio-piracy". © Seth Associates, 2007 All Rights Reserved

The Novartis patent case. . § A court in southern India on Wednesday reserved its verdict on a challenge by Novartis AG <NOVN. VX> against an Indian law that blocks patenting of minor improvements in known molecules. § India is a vital source of cheap generic medicines and campaign groups are worried that the poor in the developing world could lose access to vital drugs if the Novartis challenge succeeds. § The giant Swiss drug maker has argued that tightening of intellectual property laws would boost investment in developing more medicines, and says that the Indian patent system stifles innovation. © Seth Associates, 2007 All Rights Reserved

Case against software piracy § In another landmark decision, delivered in Microsoft vs Yogesh Papat [2005 (30) PTC 245], the Delhi High Court calculated the actual loss of business caused to the plaintiff by the defendant selling pirated software as 'freeware' with assembled computers, and awarded damages of Rs. 1. 97 million. This is the highest award for damages given by an Indian court to date for trademark and copyright infringement. © Seth Associates, 2007 All Rights Reserved

Domain names protected by Indian courts § In a recent case the Supreme Court of India held that domain names are subject to the legal norms applicable to other intellectual property. While restraining a subsequent proprietor from using another proprietor’s registered domain name, the Supreme Court considered various definitions under the Trademarks Act and held that a ‘domain name’ is a word or name that is capable of distinguishing the subject of trade or service made available to potential users of the Internet. § Satyam Infoway Ltd, a leading IT services company and one of India’s largest internet service providers, has been the registered proprietor of several domain names, including ‘sify. net’, ‘sifymall. com’ and ‘sifyrealestate. com’, since June 1999. It claimed that the word ‘sify’ was a word invented by using elements of its corporate name. Another company, Sifynet, which started an internet marketing business using the domain names siffynet. net and siffynet. com in June 2001, was restrained from using these domain names (Satyam Infoway Ltd v Sifynet Solutions Pvt Ltd, 2004 53 SCL 26 (SC)). © Seth Associates, 2007 All Rights Reserved

Protecting trademarks, copyright & patents in India © Seth Associates, 2007 All Rights Reserved

Passing off, Trademark infringement and dilution Passing off “No body has any right to represent his goods as the goods of somebody else” Lord Halsbury Passing off action allows trader A to prevent trader B from passing their goods off as if they were A’s. Passingoffisavailablewherethereisaprospectofconfusionofidentity through the unauthorized use of similar marks or get up, and such use damages, or is likely to damage the goodwill and reputation of a business. Passing off can apply to virtually any name, mark, logo or get-up which distinguishes a company, business, product or service from the other. Passing off attracts doctrine of strict liability: the intention of the person passing itself off as another trader is irrelevant. © Seth Associates, 2007 All Rights Reserved

Attributes of Passing Off Lord diplock in Erven Warnink v J Townend 1979 (2)All. ER 927 -To Succeed in an action for passing off, a claimant should establish that: The claimant has a goodwill Passing off is made in the course of trade. The defendant made a misrepresentation that is likely to deceive the public. The misrepresentation damages or is likely to damage the goodwill of the claimant. © Seth Associates, 2007 All Rights Reserved

Passing off action under the Trade Marks Act, 1999 § A registered Trademark has the backing of infringement and passing off remedies under the TMA act. § The Act does not provide for infringement action in respect of unregistered Trademarks. § Only Passing off remedy is available in case of unregistered Trademarks. (Section 27 of TMA Act, 1999). © Seth Associates, 2007 All Rights Reserved

Trademark infringement Section 29 of the Trademark Act states that when a registered trade mark is used by a person who is not entitled to use such a trade mark under the law, it constitutes infringement. A registered trade mark is infringed , if: 1. The mark is identical and is used in respect of similar goods or services or 2. The mark is similar to the registered trade mark and there is an identity or similarity of the goods or services covered by the trade mark 3. And Such use is likely to cause confusion on the part of the public or is likely to be taken to have association with the registered trade mark. For example, if you are not the Nike® company or authorized by it, it is an infringement to sell sports clothes called "Nikestuff “ Legal remedies under Indian Trademarks Act. Injunction , damages, delivery up of infringing goods, destroying infringing goods and material, etc. For cases see heading cybersquatting Satyam infoway vs Sifynet solutions 2004 (6)SCC 145. . © Seth Associates, 2007 All Rights Reserved

Dilution § Dilution is a trademark law concept forbidding the use of a famous trademark in a way that would lessen its uniqueness. In most cases, trademark dilution involves an unauthorized use of another's trademark on products that do not compete with, and have little connection with, those of the trademark owner. For example, a famous trademark used by one company to refer to hair care products, might be diluted if another company began using a similar mark to refer to breakfast cereals or spark plugs. § A trademark is diluted when the use of similar or identical trademarks in other non-competing markets means that the trademark in and of itself will lose its capacity to signify a single source. In other words, unlike ordinary trademark law, dilution protection extends to trademark uses that do not confuse consumers regarding who has made a product. Instead, dilution protection law aims to protect sufficiently strong trademarks from losing their singular association in the public mind with a particular product, perhaps imagined if the trademark were to be encountered independently of any product (i. e. , just the word Pepsi spoken, or on a billboard). © Seth Associates, 2007 All Rights Reserved

Trade Mark Infringement Kind of Infringement § § § The taking of any essential feature of the mark or taking the whole of the mark and then making a few additions and alterations would constitute infringement. The infringing mark must be used in the course of trade, in a regular trade wherein the proprietor of the mark is engaged. The use of the infringing mark must be printed or usual representation of the mark in advertisements, invoices or bills. Any oral use of the trade mark is not infringement. Advertising with the unauthorized use of the registered trade mark is also an act of infringement. Any or all of the above acts would constitute infringement if the same is done in such a manner as to sender the use of the mark likely to be taken as being used as a trade mark. Relief § § Sec 135 Relief in suits for infringement or for passing off, includes injunction and at the option of the plaintiff, either damages or an account of profits. In brief, the relief to which a plaintiff is entitled are§ An injunction restraining further use of the infringing mark. § Damages or an account of profits. § An order for delivery-up of infringing labels and marks for destruction or erasure. Injunction may be of the following types: § Anton Piller Order § Mareva Injunction § Interlocutory Injunction § Perpetual injunction. © Seth Associates, 2007 All Rights Reserved

Geographical Indications of Goods - Infringement Kind of Infringement § Sec 22 - A registered geographical § indication is infringed by a person who, not being an authorized user, uses such indication on the goods or suggests that such goods originate in some other geographical area other than the true origin of the goods which mislead the public. A registered geographical indication is infringed by a person who, not being an authorized user, uses such indication to the goods which although literally true as to the territory, region or locality in which goods originate, falsely represents to the public that the goods originate in the region, territory or a locality in respect of which such registered geographical indication relates. Relief In case false geographical indication is established, it carries penalty with imprisonment for a term which shall not be less than six months but which may extend to three years and with fine which shall not be less than fifty thousand rupees but may extend to two lakh rupees. © Seth Associates, 2007 All Rights Reserved

Legal remedies-Copyright infringements There are three types of remedies against copyright infringement Civil Criminal Administrative Sections 54 to 62 deals with civil remedies for infringement of copyright. Civil remedies include injunction, damages and accounts, delivery of infringing copies and damages for conversion. Costs: The costs of all parties in any proceedings in respect of the infringement of copyright shall be at the discretion of the court. © Seth Associates, 2007 All Rights Reserved

Legal remedies-copyright infringement The Law provides civil and criminal remedies in case of infringement of copyright. Copyright infringement is a cognizable offence where a Police Officer not below the Rank of a Sub-Inspector can arrest the offender without the warrant and conduct the search even without prior authorization of a Court. Copyright infringement if proved in a Court of Law carries a minimum mandatory sentence of imprisonment of six months and minimum fine of Rs. 50, 000 which can extend up to Rs. 2 lakh. The Act further provides that there will be an enhanced penalty in case of second and subsequent convictions. In Civil Cases, the District Court can be persuaded not only to give an interim injunction without notice to the other party but also usually gives a direction under Order 39 Rule 7 of C. P. C. where a Commissioner appointed by the Court will visit the premises of the infringers and will be empowered to conduct a search of the inventors premises and cease infringing material from the infringers premises. The seized material can be used at a later point of time to establish infringement. In UK these types of orders are called ANTON PILLOR ORDERS © Seth Associates, 2007 All Rights Reserved

Legal remedies-copyright infringement Section 63 defines what constitutes a criminal offencecopyright infringements. Any person who knowingly infringes or abets the infringement of- (a) the copyright in a work, or (b) any other right conferred by the Act (except the right conferred by section 53 A, which is the right to share in the resale price of the original copy will be punished with imprisonment for a minimum term of six months and a maximum of three years and with a fine which may vary from a minimum of 50, 000 rupees to two lakh rupees. © Seth Associates, 2007 All Rights Reserved

Legal remedies-combating copyright infringements in India Administrative Remedy –Against Importation of infringing copies: The Act provides for an effective administrative remedy to prevent importation into India of copies of a copyright work made outside India, which if made in India, would infringe the copyright in the work. Section 53 of the Copyright Act empowers the Registrar of Copyright to make an order prohibiting the importation into India of such copies on the application of the owner of the copyright in any work, or his duly authorized agent, after making such enquiry as he deems fit. The Registrar’s order prohibiting such import brings into play the provisions of the Customs Act as goods the importation of which is banned in the Act. The only difference is that the copies confiscated under this provision do not vest in the Government of India but are to be delivered to the owner of copyright in the work. Section 64 Copyright Act -power to police to seize infringing copies and plates for purpose of making infringing copies of the work Possession of plates to make infringing copies-bailable offenceimprisonment upto 2 years and fine (Section 65) © Seth Associates, 2007 All Rights Reserved

Enforcement of Copyright Kind of Infringement § Copy in a work will be considered infringed- § 1. when any person, without a licence granted by the owner of the copyright, or the Registrar of Copyrights, or in contravention of the conditions of a licence so granted, or of any condition imposed by a competent authority i. does anything, the exclusive right to do which is by this Act § conferred upon the owner of the copyright, or ii. permits for profit any place to be used for the communication of the work to the public where such communication constitutes an infringement of the copyright in the work, unless he was not aware and had no reasonable ground for beleiveing that such communication to the public would be an infringement of the copyright; or Relief Civil Remedies: § Injunction § Damages § Account of profit § Delivery of infringing copies § Damages for conversion Criminal Remedies: § Imprisonment of the accused or imposition of fine or both § Seizure of infringing copies. © Seth Associates, 2007 All Rights Reserved

Copyright Infringement (Contd. ) Kind of Infringement 2. when any personi. makes for sale or hire, or sells or lets for hire, or by way of trade displays or offers for sale or hire, or ii. distributes either for the purpose of trade or to such an extent as to affect prejudicially the owner of the copyright, or iii. by way of trade exhibits in public, or iv. Imports into India, any infringing copies of the work. Relief Administrative remedies: § Administrative remedies consist of moving the Registrar of Copyrights to ban the import of infringement is by way of such importation and the delivery of the confiscated infringing copies to the owner of the copyright and seeking the delivery. © Seth Associates, 2007 All Rights Reserved

Legal remedies for infringement of Patent § Indian Patent Act-Section 108 § Injunction § Damages or account of profits § Infringing goods and materials be destroyed. § Suit be filed in district court or high court having original civil jurisdiction © Seth Associates, 2007 All Rights Reserved

Patent Infringement Kind of Infringement § § § Relief Where any person threats any § other person with proceedings for infringement of a patent. The colorable imitation of an invention. Immaterial variations in the invention. Mechanical equivalents. Taking essential features of the invention. § § Section 106. Court has the power to grant following relief in cases of groundless threats of infringement proceedings: § A declaration to the effect that the threats are unjustifiable. § An injunction against the continuance of the threats and § Such damages, if any, as he has sustained thereby. Section 108 -The relief which a court may grant in any suit for infringement includes an injunction and at the option of the plaintiff, either damages or an account of profits. In brief, the relief which may be awarded in a suit for infringement are- § Interlocutory/interim injunction. § Damages or account of profits. § Permanent injunction. © Seth Associates, 2007 All Rights Reserved

Design Infringement Kind of Infringement § Sec 22 - lays down that the following acts amount to piracy§ To publish or to have it published or expose for sale any article of the class in question on which either the design or any fraudulent or obvious imitation has been applied. § To either apply or cause to apply the design that is registered to any class of goods covered by the registration, the design or any imitation of it. § To import for the purpose of sale any article belonging to the class in which the design has been registered and to which the design or a fraudulent or obvious imitation thereof has been applied. Relief The judicial remedy for infringement of a registered design recommended in the Act is damages alongwith an injunction. Section 22(2) stipulates remedy in the form of payment of a certain sum of money by the person who pirates a registered design. A suit in the appropriate manner for seeking the relief in the form of an injunction is also recommended. © Seth Associates, 2007 All Rights Reserved

The Semiconductor Integrated Circuits Layout-Design Act, 2001 - Infringement Kind of Infringement § According to Section 18, a person who- § does any act of reproducing, whether by incorporating in a semiconductor integrated circuit or otherwise, a registered layout-design in its entirety or any part thereof, except such act of reproducing any part thereof which is not original. § does any act of importing or selling or otherwise distributing for commercial purposes a registered layout-design or a semiconductor integrated circuit incorporating such registered layoutdesign or an article incorporating such a semiconductor integrated circuit containing such registered layout-design for the use of which such person is not entitled under this Act. Relief Any person who infringes the right of registered proprietor shall be punishable with imprisonment for a term which may be extended to three years, or with fine which shall not be less than fifty thousand rupees but which may extend to ten lakh rupees, or with both under section 56 of the Act. © Seth Associates, 2007 All Rights Reserved

Expounding copyrights challenges in digital age § The Internet makes it possible to distribute any kind of digital information, from software to books, music, and video, instantly and at virtually no cost. The software industry has struggled with piracy since the advent of the personal computer, but as recent controversy over file -sharing systems such as Napster and Gnutella , Aimster. ( , demonstrates, piracy is now a serious issue for any individual or business that wants to be compensated for the works they create. And since the Internet knows no borders, piracy is now a serious global problem. § Strong legislation such as the Digital Millennium Copyright Act (DMCA), cooperation between nations to ensure strong enforcement of international copyright laws, innovative collaboration between content producers and the technology industry, and standards developed by organizations like the Secure Digital Music Initiative (SDMI) that can prevent or deter piracy have already made an impact on addressing this problem. But as more and more digital media becomes easy to distribute over the Internet, the government and private sector must work together to find appropriate ways to protect the rights of information consumers and producers around the world. © Seth Associates, 2007 All Rights Reserved

Types of Copyright Infringement Direct Infringement It is wholesale reproduction and distribution of Copyrighted works Contributory Infringement It occurs when someone knowingly encourages infringing activity Vicarious Infringement When for financial benefit the operator in spite of his ability to control and check infringements deliberately restrains from checking the users from committing such acts-playboy enterprises inc vs webbworld, inc 991 F Supp 543(N. DTex. 1997) © Seth Associates, 2007 All Rights Reserved

E-Copyright Protection and digital music § The MP 3 revolution § The Napster story § P 2 P file sharing technology facilitates 1 -store MP 3 music files on individual § § computer hard drives available for copying by other Napster users 2 -search for MP 3 music files stored on other users computers and 3 -transfer exact copies of the contents of other users MP 3 files from one computer to another via the Internet. Napster free of charge music share software , napster internet site. It provided technical support for indexing and searching of MP 3 files also. complaint for being contributory and vicarious copyright infringer. Napster used fair use defence. Court held Napster is guilty of contributory and vicarious copyright infringement DMCA 1998 -Section 512 -safe harbour doctrine for ISPs-ISP to prove that it lacks requisite knowledge of infringing activity. (analogous to Section 79 IT Act, 2000) New avtaars-Gneutella and kazaa. © Seth Associates, 2007 All Rights Reserved

Digital downloads and reproduction & display rights § Kelly v Arriba Soft Corp 280 F 3 d 934(9 th Cir 2002) § Plaintiff leslie kelly had copyrighted many images of American west. Some were located on her website. Defendant produced thumbnail pictures in its search engine’s search results and by clicking on them, larger version could be viewed within Arriba’s page. § Circuit court held, use of thumbnails is fair use but display of larger image within its webpages is violation of author’s exclusive right to publicly display his works. © Seth Associates, 2007 All Rights Reserved

Digital downloads and distribution rights § Marobie –Fl. inc v National Association of Fire Equip Distributors 983 F Suppl 1167(NDIll) § Court held that the act of placing unauthorised copies of Plaintiff’s electronic clip art files on the defendant’s webpage constitutes an infringement of distribution rights of the plaintiff as plaintiff’s files became available for downloading by internet users. § Another case in point-Playboy enterprises , inc v Frena 839 F Supp 1552(M. D. Fla 1993) © Seth Associates, 2007 All Rights Reserved

Understanding the role of legal due diligence in digital rights management and asset protection § Legal vetting of web content -a must § Cross jurisdictional impact. Ref: Section 75 of IT Act, 2000 § Avoidance of any possible unintended violation of rightful owner’s § § trademarks, copyrights , patents. Infringement of IPR in online mode –same legal principles apply as in offline mode-IPR statutes govern e-space as well –legal position most countries including Indian IT Act, 2000 , amended provisions of IPC ( electronic record definition- Section 29 A) , Section 65 B-admissibility of electronic records of Indian Evidence Act, 1872 & Indian courts have recognized equal application of IPR protection principles in online medium. Electronic document legally recognized equal to written document in offline mode. Domain names equated with Trademarks if indicative of source of origin of goods and services © Seth Associates, 2007 All Rights Reserved

PRECEDENT ON LINKING Ticketmaster vs. Microsoft Facts: In April, 1997, Ticketmaster filed a complaint in federal court in the Central District of California alleging that "Microsoft's actions diluted their trademarks; created a false, deceptive and misleading representation that there was a formal relationship between the two of them; constituted unfair competition and business practices; and constituted a commercial misuse of their trademarks. “ Microsoft at that time operated Sidewalk, a recreational and cultural guide Web site. What Microsoft was doing was simple -- if a Sidewalk user wanted to buy a ticket to a particular event mentioned on the site, Sidewalk offered them a link to Ticketmaster's ticket purchase page. They were actually promoting Ticketmaster sales and sending them customers. A month after the suit was filed; Ticketmaster blocked Sidewalk users from their site. Links set up from Sidewalk then took users to a Ticketmaster page that read, "This is an unauthorized link and a dead end for Sidewalk. “ Status: In February of 1999, the 2 -year-old lawsuit was settled out of court. "Details of the settlement were not made public, but the deep links were removed, directing Sidewalk users to the Ticket master homepage. © Seth Associates, 2007 All Rights Reserved

Example: Indian Case on Passing off /trademark infringement in e- world Yahoo! Inc. vs Akash Arora(1999) FACTS: The defendant installed a website Yahooindia. com nearly identical to plaintiff’s renowned yahoo. com and provided services similar to those of the plaintiff. DECISION: The Delhi High Court granted an injunction restraining defendant from using yahoo either as a part of his domain name or as a trade mark . It held that trade mark law applies with equal force on the internet as it does in the physical world. © Seth Associates, 2007 All Rights Reserved

Indian case on e-passing off Example 2: In the case of Rediff Communication Limited v. Cyberbooth and Ramesh Nahata of Mumbai (1999), the Bombay High Court supported an action of passing off when the Defendants used the term ‘RADIFF’ (similar to the name ‘REDIFF’ of the Plaintiff) to carry on business on the Internet. © Seth Associates, 2007 All Rights Reserved

Similar legal position world over…Universal vs. Movie-List Facts: Movie-List , a collection of links to over 900 movie trailers, was deep linking to trailers within the Universal Web site. Originally, they were actually running the trailers, which were the property of Universal Studios, on the Movie-List server. Not only were they deep linking to trailers, Movie-List was also selling CD-ROMS with trailers they had downloaded. Universal then sent them a cease and desist, stating, "You are not permitted to link to other sites that contain our copyrighted material without our authorization. Accordingly, you must remove all images from our films as well as links to other sites that have our servers. “ Status: All trailers have been removed from the Movie-List server, and the owner no longer sells the CD-ROMS. He has removed all of the deep linking to Universal pages. Case law on framing- Washington post Co v Total news inc 97 Civ 1190(SDNY) © Seth Associates, 2007 All Rights Reserved

CASES ON FRAMING The Washington Post Company et al. vs. Total News, Inc. Facts: As a one-stop news site, Total. News. com linked to many news sites, but kept a frame, or border around them, which the news sites argued made it look like the content was from Total. News. com, changed the ad layout on the page, and kept totalnews. com as the address for book marking purposes. In the complaint the news companies claimed that Total. News misappropriated their trademarked and copyrighted material, thereby engaging in a host of crimes including unfair competition, federal trademark dilution, and trademark and copyright infringement. The news organizations said that their websites, as they appeared within the Totalnews frames, were substantially altered from the form in which they intended them to appear to users and that it was done solely for Totalnews' profit. Total. News argued that the case was in essence about its freedom to link, which it claimed was a fundamental right on the Internet. Status: The court never decided the Total. News case because the parties settled. Totalnews agreed to remove the frame. © Seth Associates, 2007 All Rights Reserved

Understanding how the New Companies Bill 2006 interferes with e-governance § § The object and reasons of THE COMPANIES (AMENDMENT) BILL, 2006 may be summarized as follows: § 1) Implementing a comprehensive e-Governance system and programme to enable the operations carried out by the Ministry and its field offices to be performed more efficiently and effectively through the use of contemporary information technology and computers. 2) Implementing an e-Governance initiative through a project named as “MCA-21” which provides the public, corporate entities and others an easy and secure online access to the corporate information, including filing of documents and public access to the information required to be in the public domain under the statute, at any time and from anywhere. 3) Inserted new sections 610 B, 610 C, 610 D and 610 E in the Companies Act, 1956 so as to make provision for electronic filing system and for payment of fees through electronic form under the Companies Act which are essential for the successful implementation of the MCA-21 Project. § § As passed by the Rajya Sabha on 21/3/2006 and the Lok Sabha on 15/5/2006) Project MCA 21 has been successfully implemented. © Seth Associates, 2007 All Rights Reserved

Thank You! SETH ASSOCIATES ADVOCATES AND LEGAL CONSULTANTS New Delhi Law Office: C-1/16, Daryaganj, New Delhi-110002, India Tel: +91 (11) 65352272, +91 9868119137 Corporate Law Office: B-10, Sector 40, NOIDA-201301, N. C. R , India Tel: +91 (120) 4352846, +91 9810155766 Fax: +91 (120) 4331304 E-mail: mail@sethassociates. com © Seth Associates, 2007 All Rights Reserved