In Indian Performing Rights Society Limited v Dalia and Advance Magazine Publishers Inc v Just Lifestyle Pvt Ltd (CA Nos 10643-10644/2010 with CA No 4912/2015 @ SLP (C) No 8253/2013), the Supreme Court, on 1 July 2015 has dismissed the appeals filed by the Indian Performing Rights Society Limited (IPRS) and Advance Magazine Publishers Inc (Advance Magazine) against orders of the High Court of Delhi, and held that if a plaintiff is residing or carrying on business at a place where the cause of action has also arisen, either wholly or in part, it has to file suit at that place. Both cases concerned the place of institution of the suit - the IPRS case is related to Section 62 of the Copyright Act 1957 (Copyright Act), while the Advance Magazine case is related to Section 134 of the Trade Marks Act 1999 (TM Act).

IPRS and Advance Magazine (collectively referred to as the plaintiffs) had filed suits for copyright infringement and trademark infringement, respectively, in the High Court of Delhi on the ground that they had a branch office in Delhi. In both matters, the Division Bench of the High Court of Delhi upheld the defendants’ objection that the suits could not be filed in the High Court of Delhi based merely on the fact that the plaintiffs' branch office was located in Delhi, without the cause of action also arising there.

In the appeals before the Supreme Court, the plaintiffs submitted that, under the provisions of Section 62(2) of the Copyright Act and Section 134 of the TM Act, they had a 'special right' to file suit where they carried on their business. To support this argument, the plaintiffs referred to the ‘non-obstante clause’ to the applicability of the Code of Civil Procedure 1908 (CPC) (which contains provisions relating to the institution of suits where the defendant resides or a cause of action arises) contained in the aforementioned sections of the Copyright Act and the TM Act, and submitted that the accrual of a cause of action (wholly or in part) as mentioned in Section 20 of Code of Civil Procedure 1908 was unnecessary.

On the other hand, the defendants contended that the abuse of those sections of the Copyright Act and TM Act by multi-national companies, in order to harass and inconvenience defendants, could not be permitted.

After considering the submissions of the parties, the Supreme Court dismissed the appeals, holding as follows:

  • A plaintiff’s 'special right' under the Copyright Act and the TM Act is subject to the rider that, where the plaintiff resides or is carrying on business at a place where the cause of action has also arisen, wholly or in part, the suit should be filed at that place, and not at other places where the plaintiff has a branch office; and
  • As explained in Heydon’s Case [76 ER 637], the interpretation of the provisions "has to be such which prevents mischief". Similarly, avoidance of counter-mischief by the defendant is also necessary, while providing a remedy to the plaintiff (referring to the plaintiff’s 'special right').

Does the ‘special right’ entitle the plaintiff to file an infringement action at a location of their head office irrespective of the fact that the cause of action has not arisen at the location of the head office? Or if the plaintiff also carries on business at the location of the defendant’s location, the plaintiff has to file the infringement action at such defendant’s location irrespective of the location of the plaintiff’s head office? Whether having branch offices across India proves to be an advantage or a disadvantage in order to rely on that 'special right' would need to be seen from future decisions.

Nevertheless, this decision has already opened up a new defence for the defendants in on-going matters.  The impact can already be felt especially in the High Court of Delhi which is known to grant ex parte orders more readily than other jurisdictions in India. Over the years the said readiness has prompted large companies to utilise (whether rightly or wrongly) their 'special right' under Section 62(2) of the Copyright Act and Section 134 of the TM Act to institute suits in Delhi.

The decision also has significance under the Indian litigation procedures which are complex with CPC itself having its own amendments for various Indian states. More so, the complexities increase in case of chartered courts like the Bombay High Court.

If convenience of either parties (whether the plaintiffs or defendants) is to be fairly considered, special IP courts with uniform procedures is the need of the hour. Until then, issues such as jurisdiction are likely to be raised.

“This article first appeared on WTR Daily, part of World Trademark Review, in (July/2015). For further information, please go to www.worldtrademarkreview.com.”