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IPR Amicus - April 2019

Lakshmikumaran & Sridharan
MEMBER FIRM OF TerraLex

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India April 30 2019

In a judgement delivered on April 10, the Delhi High Court has granted a 'dynamic' blocking injunction against certain websites publishing pirated films whereby the list of blocked websites can be updated as and when

mirror websites are brought to the notice of the

Court by the right holder. Conventionally, any

new website which was not part of an existing

order, would constitute a new act of infringement

and calls for a new suit or at least a new judicial

finding before it can be blocked. However, as per

the scheme devised by the Court, considering the

flagrant and rapid piracy on these websites which

can create mirror servers overnight, the right

holders would not need judicial order by the

Judge but they can approach the Joint Registrar

(who are not judges but are judicial officers

discharging procedural functions on behalf of the

judges such as case management, extensions

etc.) of the High Court to extend the injunction

against a mirror or indirect replica of the blocked

website publishing the same infringing content.

The order pertains to multiple suits involving

plaintiffs that include UTV Software

Communications Ltd. who are into creation,

production, and distribution of copyrighted films in

India and abroad. The defendants in these suits

are websites, unknown website operators

impleaded as John Doe defendants, the Ministry

of Electronics and Information Technology, the

Department of Telecom and various Internet

Service Providers (ISPs).

1 UTV Software Communication Ltd. v. 1337x.to – Judgement dated 10-4-2019 in CS(COMM) 724/2017 and Ors., Delhi High Court.

The right holders alleged that the websites

published the copyrighted films by streaming

and/or enabling download which amounted to

infringement under the Copyright Act, 1957. The

governments bodies and the ISPs appeared

before the Court but no relief was sought against

them as they primarily were impleaded to assist

the Court in identification of the main websites

and their operators. The main defendants i.e. the

websites and their operators did not appear

before the Court after summons. However, the

Court deemed the issues involved in the case to

be ‘of general public importance’ and appointed

an amicus curiae (friend of the court) to assist the

court with the legal issues.

Whether an infringer of copyright on the internet is to be treated differently from an infringer in the physical world?

The Court held that there is no difference

between an infringer in the physical world and the

one in the online world nor such a distinction has

been made by the Copyright law. The modern

piracy is a multi-billion-dollar business and only a

fraction of these sites are genuinely supported by

ideologies of social good in piracy.

Whether seeking blocking of a website dedicated to piracy makes one an opponent of a free and open internet?

The issue pertains to an apparent conflict

between the need for orders blocking websites

and free and fair internet. The Court observed

that issue is not whether internet should be

completely free from government control and

Article

IPR AMICUS / April 2019

© 2019 Lakshmikumaran & Sridharan, India All rights reserved

3

censorship but whether a balance can be drawn

between freedom and statutory rights. Court held

that putting appropriate limits on accessing

content is not opposed to freedom of internet.

Clearly, the Court has felt that protection of

copyright (and by that logic other intellectual

property rights) is a reasonable restriction on

freedom of internet. Needless to say, in these

cases whether a website or any of its content is

infringing any copyright would be a matter of

proof.

What is a ‘Rogue Website’ and whether the test for determining a ‘Rogue Website‘ is a qualitative or a quantitative one?

Referring to a Singapore Supreme Court’s

decision, the term “Flagrantly Infringing Online

Locations (FIOL)†was discussed. It was

observed that there are websites which primarily

or predominantly share infringing content. The

Court also provided some factors based on which

a website can be said to be ‘FIOL’ or rogue, such

as primary purpose being targeted to piracy,

flagrancy of infringement or facilitation thereto,

details of website owner or operator being

masked, silence on take down notices,

restraining orders from other Courts/jurisdictions,

volume of traffic towards the website, how it

presents its infringing content say, indexing,

listing etc.

For determining whether a website is ‘rogue’,

the Court considered the ‘quantitative’ approach

for blocking injunctions while referring to the

decision in Eros v. BSNL by the Bombay High

Court (Single Bench) and the qualitative

approach in the DEITY v. Star India case of the

Delhi High Court (Division Bench). In the

quantitative approach, John Doe blocking

injunctions were not granted by Bombay High

Court against entire websites because Court held

that specific instances of infringement are to be

proved because the website may have non-

infringing content also.

This decision follows the ‘qualitative’

approach which favours blocking injunctions

where the ‘rogue websites’ are ‘overwhelmingly

infringing’. The Court held that these websites

can change their URLs within seconds and

considering they have large number of films

uploaded, it would be too cumbersome and

onerous for the rights holder to expect to provide

URLs for all titles. Further, not all titles available

on a website would belong to one right holder but

other production houses. One cannot expect the

plaintiff to seek declaration on infringement from

owners of other content uploaded on the website

before granting a blocking injunction. It would be

an onerous task and the purpose of injunction

would not be served as the rogue website would

easily switch, mask, multiply and mirror its URLs

while the plaintiff gets declaration from other

owners. Court said that it cannot hold that a

‘rogue website’ is only that which entirely

contains infringing content because this would

prompt these websites to upload a small portion

of legitimate content and escape injunction while

predominantly containing pirated content.

Whether the defendant-websites fall in the category of ‘Rogue Websites‘ and whether this Court would be justified to pass directions to block the ‘Rogue Websites’ in their entirety?

The Court found that all the websites in the

suit were satisfying the test factors, including

orders in foreign countries and held all of them as

rogue websites.

The Court said in a website blocking

injunction order, it would have to also be

considered whether disabling access to the

online location is in the public interest and a

proportionate response in the circumstances and

the impact on any person or class of persons

likely to be affected by the grant of injunction.

The Court also said that the injunction must not

create barriers to legitimate trade. The measures

IPR AMICUS / April 2019

© 2019 Lakshmikumaran & Sridharan, India All rights reserved

4

must also be fair and not excessively costly.

However, noting the need for urgency and

enormous difficulty in curbing piracy of foreign

websites, the pace at which the single URLs for

infringing titles can be changed and actions taken

by various foreign countries, Court was of the

view that in this case the balance tilts in favour of

granting blocking injunction to entire website.

Court also took note of the difficulty of right

holders in repeatedly coming to Court in separate

actions if the entire website is not blocked

because a rogue website could easily wriggle out

of a mere URL injunction by changing the same

and continue its illegal business on the website.

How should the Court deal with the hydra headed ‘Rogue Websites‘ who on being blocked, actually multiply and resurface as redirect or mirror or alphanumeric websites?

While the discussion till the last issue was on

blocking “URL†versus “entire websiteâ€, the Court

also ventured into a significant area whereby

even after a comprehensive ban on a website,

while it cannot escape injunction by mere change

of URL within the same website, the operators

create ‘mirror websites’ or ‘alphanumeric

variants of the same websites’ but publishing the

same infringing content. In such a case,

technically, the website is not the same. For such

cases, the Court referred to the Singapore High

Court’s decision in Disney v. M1, where the Court

passed a blocking order which was a ‘dynamic

injunction’. In this case, a plaintiff could, instead

of filing a new case or motion, simply file an

additional affidavit before the Court giving reasons

for a new website falling within the purview of

existing blocking order and the same can be sent

to an ISP which was free to dispute the reasons

for the blocking order. Court observed that this

dynamic injunction originated from a specific

provision but held that such powers are available

under the Indian Code of Civil Procedure,

1908 under Section 151 which provides inherent

powers to the Court to craft a similar relief. The

Court held that in such cases, plaintiff could seek

injunction by impleading additional websites

under Order 1 Rule 10 of the CPC.

Interestingly, considering the rapidity with

which rogue websites operate and large number

of mirror/indirect rogue websites, the Court held

that the Judges should not have to constantly

monitor such affidavits and additional rogue

websites. Therefore, the Court delegated the

power to decide the issue of adding

mirror/indirect websites to an existing blocking

order to the Joint Registrar of the Delhi High

Court. Joint Registrars are officers of the Court

who largely decide procedural issues like case

management hearings, extensions of time etc. In

the present case, the Court delegated the power

under Section 7 of the Delhi High Court Act, 1966

read with Chapter II, Rule 3(61) read with Rule 6

of the Delhi High Court (Original Side) Rules

2018. Any finding of a joint registrar under this

provision whereby he/she decides addition of

websites to an existing blocking order, is

appealable.

The Court also gave directions to the

government ministry and department, impleaded

as defendants in this case, to consider the

Court’s suggestion to come up with a policy for a

graduated response scheme. The Court

suggested that in this scheme individuals who

access ‘pirated content’ can be warned by ISPs

and if they do not cease from accessing pirated

content, appropriate actions including fines can

be considered.

Conclusion

This decision is important in at least three

respects. Firstly, while blocking orders over entire

website is not unknown, the fact that Court has

allowed the plaintiffs to ‘update’ the list of blocked

websites as and when a blocked website creates

its illegal twin/mirror image, is novel. Secondly,

IPR AMICUS / April 2019

© 2019 Lakshmikumaran & Sridharan, India All rights reserved

5

delegating the power to Joint Registrar to

effectively ‘update’ an existing injunction order is

also not common because that is effectively a new

website blocked and amounts to a judicial order.

Thirdly, the Court’s sensitivity to rights holders is

apparent when they consciously urge the

government body to consider cautioning even

individual users to refrain from using pirated

content. It is clear that the Court has consciously

pursued a pro-active approach to balance

interests of rights holders against “free internetâ€.

This is apparent because Court has discussed the

large scale negative impact of piracy to not only

the industry but also to economies. In India alone,

it has been noted, that the film industry earns less

in theatres, TV rights and home videos compared

to the earnings of the piracy industry of the same

movies. This order may raise lot of questions on

either side of the spectrum and people may argue

that this is excessive enforcement as the dynamic

scheme may be subject to abuse. Nevertheless, it

is surely a starting point for paving the way

towards curbing piracy in a systematic way.

[The author is a Joint Partner in IPR Practice,

Lakshmikumaran & Sridharan, New Delhi]

Patents – Exemption under Section 107A available to exports for clinical studies

A Division Bench of the Delhi High Court has

held that sale, use, construction of patented

products by persons who do not hold patents or

licenses from patentees, in terms of Section

107A of the Patents Act is correct, provided it is

reasonably related to research and development

of information in compliance with laws of India (or

the importing country). The Court hence allowed

the Bolar exemption to patented goods exported

by the person who was not the holder of the

patents for the product exported (though had

compulsory licence), to conduct clinical studies

and trials for development of information for

regulatory purposes.

The Court was of the view that it cannot be held

that the Parliament intended to per se exclude

“exports†from the sweep and width of the term

“sale†in Section 107A. It noticed that once it is

held that patented inventions can be sold for

carrying on research which fulfils the regulatory

requirements of India, there cannot be any bar or

an interpretation narrowing the scope of such

sale. It observed that if the purpose of the sale is

to ultimately exploit the patented invention and

either work upon it or “work around†or work it

through research to be prepared to apply for the

patent for approval to market it once the patent

tenure ends, there can be no impairment of the

patentee’s rights. It also rejected the contention

that Section 107A constitutes an exception and

must be read as subordinate to the main provision

of Section 48.

The Court in this regard also observed that the

course of the experimental exception- both before

and after the TRIPS has shown the adoption,

generally of a broad approach, to permit use of all

kinds, and that the courts approach has been not

to enjoin or prohibit purely experimental or

scientific activity, as long as it does not have any

primary commercial undertones. Provisions as

prevalent in USA, UK and Canada were relied

upon while also tracing the legislative history of

the Indian Section 107A. [Bayer Corporation v.

Union of India – Judgement dated 22-4-2019 in

LPA No.359/2017, Delhi High Court]

Ratio decidendi

IPR AMICUS / April 2019

© 2019 Lakshmikumaran & Sridharan, India All rights reserved

6

Trademarks – No suit for passing off maintainable if plaintiff’s use not honest

The Delhi High Court has held that plaintiff which

is a sister concern of and hired by Elder

Pharmaceuticals Ltd. (EPL), cannot claim latter’s

trademark and reputation on liquidation of EPL.

Holding that such use with the knowledge of

registration of trademark is not bona fide, the

court observed that post liquidation proceedings,

Plaintiffs started using the Elder trademarks in

relation to the goods manufactured and sold

under their own name without the permission or

consent of EPL and thus such use of the mark

cannot be characterized as “permitted use†and

would amount to infringement. It observed that

the official liquidator who is the custodian of

assets of liquidated company can claim benefits

of reputation and goodwill of its trademarks.

The High Court also held that for acquiescence

under Section 33 of the Trademark Act, use must

be for a continuous period of 5 years and hence

Plaintiff cannot claim acquiescence. Plaintiff’s

claim of shared reputation was also rejected by

the Court observing that both plaintiff and

defendant were infringers. It held that it was a

case of a senior infringer suing a junior infringer.

Dismissing the suit with costs, the court was of

the view that Plaintiff cannot succeed on the

claim of passing off because the use of the mark

was not honest or bona fide and was also

conflicting and infringing the registered marks of

EPL. [Elder Projects Ltd. v. Elder Pharmacia LLP

– Judgement dated 5-4-2019 in CS(COMM)

1313/2018, Delhi High Court]

Trademark registration confers rights on whole and not on individual parts

The Delhi High Court has reiterated that

registration of trademark under Section 17(1) of

the Trademarks Act confers exclusive rights to

use trademark as a whole and not a right of

registration to individual parts. Court held that

plaintiff can claim rights to use ‘Delhi International

School’ label as well as the DIS logo as a whole,

but not right to use words ‘Delhi International

School’ as registered mark. The Court prima

facie rejected the plea that words ‘Delhi

International School’ are a prominent part of the

plaintiff’s label and, therefore, use of the said

name would also amount to infringement of its

trademark. It observed that the specified words

were not the prominent part of the said logo.

The Court also prima facie rejected the plea of

passing-off based on the interactive website. The

plaintiff had claimed that the cause of action

regarding passing off arose in Delhi as the

defendants have an interactive domain names

through which the defendants are passing off

within the territorial jurisdiction of the Court. The

Court however observed that students in Delhi

would not seek admission elsewhere. It also

observed that no material was placed on record

to indicate that any of the defendants had

succeeded in deceiving any person to believe

that they are connected with the plaintiff or the

schools run by them are affiliated with the

plaintiff. However, relying on precedents, it also

held that the question of jurisdiction must be

considered on a demurer. [Nav Jagriti Niketan

Education Society v. Delhi International School –

Judgement dated 28-3-2019 in CS(COMM)

698/2018, Delhi High Court]

Exclusive jurisdiction of court by agreement not violate Copyright Section 62

The Delhi High Court has held that an agreement

conferring exclusive jurisdiction on a particular

Court is not in violation of Section 28 of the

Indian Contract Act, 1872 or Section 62 of the

Copyright Act, 1957. Court reiterated that where

more than one Court has jurisdiction, parties can

legally confer jurisdiction to any one Court to the

exclusion of others. It however observed that it is

to be seen whether such an agreement is clear

IPR AMICUS / April 2019

© 2019 Lakshmikumaran & Sridharan, India All rights reserved

7

and unambiguous and the intention of the parties

to submit to one Court having jurisdiction to

adjudicate the subject matter while excluding the

jurisdiction of another is clearly discernible from

the agreement itself. The High Court upheld the

order of the trial court by which plaint was

ordered to be presented before jurisdiction of

Courts at Mumbai as stipulated in clause 12 of

the agreement between the parties. [Achla

Sabharwal v. A. Saptarishi Films – Judgement

dated 25-3-2019 in FAO 40/2017 & CM No.

2669/2017, Delhi High Court]

Non-renewed trademark cannot be removed without complying with procedure

The Delhi High Court has held that though

plaintiff was not able to renew its trademark

registration, the trademark in question cannot be

removed by the Registrar without compliance

with the provisions of Trademark Section 25 and

Rule 67 of the Trademark Rules 1959 which is

akin to Rule 64 of the Trademark Rules 2002.

Court observed that denial of consideration of

application for renewal has the effect of removing

the Mark from the Register of the Trademarks,

i.e., something which is only permissible if a

notice is given to the petitioner as contemplated

under Section 25 of the Trademarks Act.

Observing absence of any third party applying for

registration of said mark, the Court directed the

Registrar to consider application of renewal of the

mark ‘Binaca’ subject to late fee. Judgement in

UOI v. Malhotra Book depot was relied on.

[Gopal Ji Gupta v. UOI – Decision dated 18-3-

2019 in W.P.(C) 7644/2017, Delhi High Court]

Overall look of the product enough to determine piracy of design under Section 22

The Delhi High Court has reiterated that overall

look of the product is to be judged with the naked

eye and that intricate examination of the design is

not to be done for determining piracy of design

under Section 22 of the Design Act. Court also

held that application for trademark registration did

not constitute prior publication as the same only

contained model names and not product

photographs. Plea of prior publication in

advertisement was also rejected by the Court

observing that the design was not identical to

designs contained in the advertisement.

[Symphony Ltd. v. Thermo King India Pvt. Ltd. –

Decision dated 28-2-2019 in CS (COMM)

321/2018, Delhi High Court]

Trademark - Permanent injunction from use of ‘TICER’, infringing ‘TIGER’

The Delhi High Court has reiterated that non-use

by the plaintiff cannot be a defence to an action

of infringement and that application for removal

was to be filed by defendant before the Registrar.

Defendant was held liable to permanent

injunction since they could not explain adoption

of the word TICER for shoes. Noting similarities,

court observed that defendants merely replaced

alphabet ‘G’ in the trademark TIGER with ‘C’ and

that the change is unlikely to be noticed.

The High Court was also of the view that verbal

request for summary judgement was

maintainable. It observed that the Court by its

Rules, is competent to, notwithstanding Order

XIIIA of the Civil Procedure Code, provide for

application to be filed for summary judgment.

However, even without such an application, the

Court is competent to pass summary judgment. It

also held that dehors Order XIIIA also, the

commercial suits can be disposed of under Order

XV Rule 1, if found to be applicable. [Mallcom

(India) Ltd. v. Rakesh Kumar – Decision dated

19-3-2019 in CS (COMM) 480/2016, Delhi High

Court]

IPR AMICUS / April 2019

© 2019 Lakshmikumaran & Sridharan, India All rights reserved

8

Union Cabinet approves accession to Nice, Vienna and Locarno Agreements

The Union Cabinet has approved proposal for

accession of India to the Nice Agreement

concerning the international classification of

goods and services for the purposes of

registration of marks, the Vienna Agreement

establishing an international classification of

figurative elements of the marks, and the

Locarno Agreement establishing an

international classification for industrial

designs. Accession to these Agreements will

help Intellectual Property Office in India to

harmonize the classification systems for

examination of trademark and design

applications.

GI certification for five varieties of Indian coffee

The Department for Promotion of Industry and

Internal Trade, Ministry of Commerce and

Industry has recently granted Geographical

Indication to 5 varieties of Indian coffee. They

are Coorg Arabica, Wayanaad Robusta,

Chikmagalur Arabica, Araku Valley Arabica

and Bababudangiris Arabica. Monsooned

Malabar Robusta coffee, was given GI

certification earlier. As per the press release

issued by the Ministry on 29-3-2019, India is

the only country in the world where the entire

coffee cultivation is grown under shade, hand-

picked and sun dried.

Broad claim in patent ineligible as it pre-empts use by entire industry

US Court of Appeals for the Federal Circuit

has reiterated that if claims are directed to a

broad law or an abstract idea, patent is

ineligible under U.S.C. § 101. Court in the

case ChargePoint v. SemaConnect affirmed

that the patent relating to network-controlled

charging stations for electric vehicles is

ineligible since claim involves an abstract idea

to which the claim is ‘directed to’. It held that

broad claim in patent would pre-empt entire

industry’s ability to use networked charging

station. Court observed that there was no

suggestion that charging stations were

improved from technical perspective.

Specific function using natural law is patentable

US Court of Appeals for the Federal Circuit

has held that a new treatment of an ailment

albeit using a natural law, is eligible for patent

claim as it is not same as claiming a natural

law. Court in the case Endo Pharmaceuticals

v. Teva Pharmaceuticals observed that claim

of 737 Patent is not ‘directed to’ a detection

method but to a treatment method and that

same is eligible since it is a specific treatment

directed to specific patients using specific

compounds at specific doses to achieve a

specific outcome. As per § 101, natural

phenomena are non-patentable.

Comparison of white salt to poison without proof is disparagement

Delhi High Court has in case of Tata

Chemicals v. Puro Wellness restrained the

defendant from televising or publishing any

commercial resulting in disparagement and

denigration of plaintiff’s product, Tata Salt. It

observed that defendant’s intention was not

merely to promote its product but to call white

salt in general and specifically Tata Salt,

dangerous. Court held that if a product is

manufactured as per prescribed regulations,

News Nuggets

IPR AMICUS / April 2019

© 2019 Lakshmikumaran & Sridharan, India All rights reserved

9

terming the same as poison is obviously to

slander that product. It also noted that even

limited circulation constitutes publication.

TV commercial making fun of men using women’s cream is not disparagement

Observing that plaintiff itself has a separate

cream for men and that it cannot be said

that prima facie the statement made in the

advertisement regarding use of women’s

cream by men is false, Delhi High Court has

dismissed a case of disparagement. Court in

HUL v. Emami Ltd. held that advertisement of

Fair & Handsome does not tantamount to

generic disparagement of Fair & Lovely, in

view of the literature on plaintiff’s website

which shows that latter had positive impact on

the lives of women. Plaintiff was held to be

oversensitive on story of the commercial.

IPR AMICUS / April 2019

© 2019 Lakshmikumaran & Sridharan, India All rights reserved

10

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