India’s IP jurisprudence grows by leaps and bounds
Shrawan Chopra and Vibhav Mithal of Anand and Anand examine recent judicial developments in India concerning a range of issues including contempt of court, summary judgments, local commissioners and royalties for SEPs
"India rises in Intellectual Property rankings" proclaimed the headlines when the Global Intellectual Property (IP) Index was released by the US Chamber of Commerce in February 2018. Compared to past years, India made improvements in both absolute and relative terms and represented the largest percentage improvement of any country measured for the sixth edition of these rankings. While the assessment of India's intellectual property law climate by these rankings should not be taken as the gospel truth, the acknowledgement of improvement highlights that intellectual property law protection for right owners is on the rise. In this context, this article focuses on recent judicial developments to highlight the positive direction IP enforcement is taking in India.
Summary judgments under the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 (the Commercial Courts Act) are becoming the norm, reducing litigation time and saving costs.
The Commercial Courts Act, 2015, an act that categorised IP disputes as "commercial matters" to streamline and expedite IP litigation, introduced the provision of summary judgment for civil disputes. The provision entitles a court to decide a dispute without evidence, if it forms the view that the plaintiff or defendant has "no real prospect of successfully defending a claim". This provision is now being adopted by courts regularly to grant relief to IPR owners. The Delhi High Court, the first Court to have adopted the Commercial Courts Act has led the way in summary judgment jurisprudence.
Summary judgments under the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 (the Commercial Courts Act) are becoming the norm, reducing litigation time and saving costs
For example, in Merck Sharpe and Dohme and Anr. v Munish Thakur, the Court suo motu invoked the provision of summary judgment. The suit was therefore decreed in favour of the patentee along with actual costs without recording of oral evidence as the Court was of the opinion that the defendant had no real prospect of defending its claim.
Similarly, in Helamin Technology Holding SA & Anr. v Haribansh Rai & Ors, summary judgment was granted in a trade mark dispute in favour of the plaintiff. Additionally, in Bharti Bhawan v M/s Shree Jee Prakashan, the Court granted a decree for copyright infringement in favour of the plaintiff, by passing a summary judgment.
The above examples clearly show that the grant of this relief has not been limited to any particular type of intellectual property. Furthermore, it is not even necessary for parties to request a summary judgment as courts are invoking the new provision of their own accord. This has significantly reduced the time period for litigation and saved costs for IP owners as the evidence stage is removed. The continuation of this important trend will enable IP owners to file more lawsuits to effectively enforce their rights, especially in run-of-the-mill counterfeit cases.
Contempt of court is not a joke
Taking strict action against lying, courts have interpreted it as "obstruction of justice" that amounts to contempt (Louis Vuitton v Omi). In Louis Vuitton v Omi, the defendant made a false statement on oath which the court held to be contempt. The court sentenced the defendant to jail for one month.
Similarly, in Bridgestone Corporation v Tolin Tyres, the Delhi High Court, utilising the mechanism under the Right to Information Act, directed the government official of the Land Customs Port, Bihar, to produce information regarding the export of tyres by the defendant under the trade mark Bridgestone. This led to the defendant finally admitting to and apologising for the infringing products that had been exported. Displeased with the defendant's conduct, the Court directed the defendant's director to be sent to judicial custody for a day and to pay INR 30 lakh (approximately $42,000) to the plaintiff as compensation.
These rulings have altered the jurisprudence around contempt. The threat of imprisonment is bound to act as a serious deterrent for infringers and these rulings should caution them with respect to their conduct before the court.
Local commissioners become the "eyes and ears of the court"
Upholding and strengthening the position of a local commissioner (LC), the Delhi High Court in Louis Vuitton v Omi held that a local commissioner is the "eyes and ears of the Court" and an "extended arm and agent of the Court".
This is a significant ruling as local commissioners are essential in IP matters, especially for the search and seizure of infringing products. The ruling implies that any non-compliance with the local commissioner would be contempt of court. This ruling enables taking appropriate action against infringers, who at times act in an unruly manner and do not cooperate during the search and seizure process.
The fog clears with respect to determining royalty for standard essential patents
In July 2018, in the first post-trial decision in India relating to standard essential patents (Koninklijke Philips Electronics N.V. v Rajesh Bansal (CS(COMM) 24/2016) and Koninklijke Philips Electronics N.V. v Bhagirathi Electronics and Ors. (CS(COMM) 436/2017), by a joint order dated July 12 2018), Philips was granted a permanent injunction along with punitive damages. The court held that Philips' Indian patent was an "essential patent" for DVD technology since the patentee had proved that the corresponding US and EP patents had been declared as essential for DVD Technology i.e. "DVD-Rom, Video Disk and DVD play backs". The court stated that the following could be considered for ascertaining royalty:
the parties' informal negotiations with respect to the end product;
FRAND terms; and
the incremental benefit derived from the invention.
Furthermore, the court's assessment of damages was based on the "wrong doing" of the defendants. The court also awarded actual costs i.e. legal fees, court fees and local commissioner's fees to the plaintiff. The principles of law laid down in this judgment will act as a precedent for all standard essential patent cases in the future.
Taj Mahal Palace Hotel, Mumbai obtains trade mark protection and joins an elite club consisting of the Empire State Building and the Eiffel Tower
In a first, the famous Taj Mahal Palace Hotel in Mumbai was granted protection by the registrar of trade marks as an image mark. Established in 1903, the hotel is one of the most well-recognised buildings in India and registration for its architectural design has placed it in the league of iconic buildings around the world that have been given trade mark protection such as the Empire State Building in New York and the Eiffel Tower in Paris.
Wherever the defendant's phone network goes, the court's summon follows
Modifying the manner of service of the court in accordance with the growth of technology, in a first, the court directed a defendant to be served through Whatsapp. This is extremely useful in IPR cases, where sometimes infringers avoid service.
IP owners' communication with investigators is privileged
Acknowledging the importance of carrying out investigations for IPR suits, the Delhi High Court held that communication between the plaintiff and its investigator qualifies as privileged communication under Sections 126 and 129 of the Indian Evidence Act.
The above judicial developments clearly show that Indian IP jurisprudence is rapidly growing to aid IP owners, and the Delhi High Court is at the forefront of this growth. If the defendant has "no real prospect of defending a claim", the court may, of its own accord, decide the suit by passing a summary judgment, saving judicial time and litigation costs. Local commissioners have been empowered to become the "eyes and ears and agents of the Court". If infringers refuse to cooperate with them, they would be liable for contempt and could even be imprisoned. This is bound to act as a deterrent and ensure compliance. There is clarity on how to determine royalty for standard essential patents. IP owners can strategise with their investigators without the threat of disclosure before courts. Last but not least, an infringer evading service can be served by court – as long as it has a smartphone with connectivity.
Shrawan has over 12 years of experience as an intellectual property litigator at Anand and Anand, and represents clients before the Intellectual Property Appellate Board, the High Court and the Supreme Court.
Shrawan’s expertise in IP litigation sees him advise and represent pharmaceutical, food and beverage and major industrial players on numerous issues. His litigation experience spans patent, copyright, trade mark and domain name disputes.
Vibhav Mithal is a senior associate at Anand and Anand and practises as an intellectual property litigator in various areas of IP. He is a graduate of the National University of Juridical Sciences (NUJS), Kolkata. Vibhav has also pursued an LLM in intellectual property law as an LLM scholar, from Boston University School of Law. Besides providing critical input in various matters, he has also been involved in many high stake litigations. For instance, the Aloys Wobben dispute before the Supreme Court which held that the same party cannot challenge the same patent in multiple forums and the Roche v Cipla dispute, a landmark decision in favour of the patentee that laid down extensive principles regarding patent law jurisprudence in India.