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Year in review

i Legislative develomentsJan Vishwas Amendments to IP laws

The central government ushered in amendments to various central legislations through the Jan Vishwas (Amendment of Provisions) Act, 2023 (the Amendment Act), which included the copyright patents, trademarks and GI statutes. These amendments were brought in as part of the initiative to decriminalise and rationalise offences under several statutes with a view to boost ease of living and ease of doing business. The Amendment Act removes from the Copyright Act, the provision which penalised persons, with imprisonment, for making false statements to deceive or influence any authority or officer. The Amendment Act also touches upon the Patents Act by, most notably, diluting a patentee's obligation of providing a statement as to the extent to which the patent has been commercially exploited or worked in India, by reducing the penalty for non-filing or refusal to file such a 'working statement' in respect of the patent from 1 million to 100,000 rupees. Further, the Amendment Act also reduces the penalty, existing under the TMA, for falsely representing a trademark as registered by replacing the provision of imprisonment and discretionary fine for such false representation with either a statutory fine of 500,000 rupees or 0.5 per cent of the defaulting person's business, whichever is lesser. These amendments have, at present, been only passed in both the Houses of the Parliament and are yet to be notified by the central government in the Official Gazette.

Amendments to the Cinematograph Act, 1952

Amendments were brought in to the Cinematograph Act, 1952, in 2023, for the first time in over 40 years of its history. Hitherto, the Cinematograph Act only pertained to certification and censorship of films by providing for constitution of a Central Board of Film Certification (CBFC) and regulating its functioning. The amendments expand its scope by introducing stringent anti-piracy provisions. The Act now imposes strict penalties on individuals involved in unauthorised recording or exhibition of a film by making both the acts punishable with imprisonment of up to three years and a fine of up to 5 per cent of the audited production cost of the subject film. Other notable changes include the introduction of a new age-based sub-categorisation under the 'UA' category of film certification, allowing CBFC to now classify films as 'UA 7+', 'UA 13+' and 'UA 16+'.

ii Case law developmentsIntex Technologies v. Telefonaktiebolaget LM Ericsson31 and Nokia Technologies OY v. Guangdong Oppo Mobile Telecommunications Corp Ltd & Ors32

The year 2023 witnessed the Delhi High Court coming down heavily on unwilling implementers seeking to avoid paying royalties to patent holders for implementing and utilising standard essential patents (SEPs) through two crucial judgments, both rendered by two-judge benches of the court. The courts, in both the decisions, categorically observed that fair, reasonable and non-discriminatory (FRAND) requirements impose mutual reciprocal obligations on both SEP holders as well as implementers, and that where the licensing offer made by the SEP holder was FRAND-compliant, the implementer is mandatorily required to either accept the offer made by the SEP holder, or make a counteroffer with security payment, pending resolution of the dispute, to protect the interests of the SEP holder. The implementer cannot, in such a scenario, stay silent or chose to not take any action and it cannot continue selling its devices using the SEPs. Notably, in both the decisions, the courts held that even at an interim stage, in case infringement is prima facie made out, the SEP owner would be entitled to either an injunction against the unwilling implementer or an ad hoc royalty from the implementer. The courts observed that, keeping in mind the realities of the Indian juridical system, where the timelines for the conclusion of a fully fledged trial are unpredictable, courts cannot be precluded from granting injunctive reliefs at the interim stage if the infringer's conduct is deemed by a court to be of an 'unwilling licensee'. The significance of these judgments is underscored by the increasing importance and magnitude of the Indian smartphone and electronics market, owing to which, the potential royalties attributable to the Indian market constitute a sizeable portion of a given smartphone company's global revenue and business.

DRS Logistics v. Google India Pvt Ltd & Ors33

In another significant judgment rendered by a two-judge bench of the Delhi High Court in 2023, it was held that use of registered trademarks as key words or 'ad-words' for the purpose of triggering or displaying advertisements on the results page of a search engine would constitute 'use' as a trademark. The court also ruled that such 'use' would constitute infringement if it could be shown that the use was likely to cause confusion or deception among the public. Pertinently, the court observed, in the facts of the case, that because Google's role in promoting and suggesting use of trademarks as keywords through its AdWords Program is anything but passive, such use would entail liability, not only of the advertiser who uses the registered trademark of another, but also of Google for actively facilitating and enabling such infringement. Notably, however, the bench also held that, unless it is established by the registered trademark owner that unauthorised use of its trademarks as keywords has resulted in confusion, no liability for infringement would arise.

Centre Consortium LLC v. Krunal Harjibhai Sardhara34

In a landmark judgment upholding the maintainability of a cancellation petition as regards jurisdiction, the Delhi High Court has held that the original petitions for cancellation of registered trademarks can be entertained before any High Court, notwithstanding if it has jurisdiction over the office of the Trade Marks Registry where the concerned application for registration was filed. The court ruled that the only requirement to be satisfied to justify the maintainability of such a petition would be to show that the 'dynamic' or exclusionary effect of the registrations is felt within the jurisdiction of the forum High Court. The judgment holds significant value because it provides clarity on the issues concerning the situs of these petitions, which had become uncertain owing to 2021 legislative overhaul which discontinued the tribunal previously endowed with the jurisdiction to hear such matters, and transferring the jurisdiction back to High Courts. Recently, however, due to a contrary decision having been rendered by a coordinate bench of the Delhi High Court in a similar matter, this issue has been referred for adjudication to a larger bench of the Delhi High Court.

Microsoft Technologies v. The Assistant Controller of Patents and Designs35

The Delhi High Court ruled, in this case, that the statutory bar under the Indian Patents Act deeming 'mathematical or business method or a computer program per se or algorithms' to be ineligible for patent protection could not preclude all computer-related inventions from being granted patents, if it could be shown that the invention provides a significant technical contribution or effect or has some other technical benefit in the relevant technological domain. The Court held, in the facts of the case, that Microsoft's subject invention of using two cookies for carrying out user authentication instead of one had sufficient technical effect and satisfied the patentability requirement, thereby reversing the Patent Office's order refusing the grant of patent. At the same time, the Court also observed that the meaning and scope of the terms 'technical effect' and 'contribution', as appearing in the guidelines issued by the Patent Office, was unclear. The Court called upon the Patent Office to consider including illustrations and examples to offer better clarity to both courts as well as patent examiners.

Indian Performing Rights Society Ltd v. Rajasthan Patrika and IPRS v. Music Broadcast Ltd 36

In a watershed development towards safeguarding the rights of authors of original underlying works, the Bombay High Court has held that the authors of underlying literary and musical works are entitled to claim royalties in respect of their works where sound recordings incorporating their underlying works are communicated to the public through radio broadcast. The judgment marked a significant development because it accounts for the first time that a court has diverted from a previous judgment rendered by the Supreme Court back in 1997, where it was held that authors of underlying works forfeit all rights once their works become a part of a cinematograph film, owing to Sections 17(b) and 17(c) of the Copyright Act. While some legislative changes were brought about to the Copyright Act back in 2012 to diffuse the damage done by the Supreme Court judgment and to do right by the authors of underlying works, the radio broadcasters and other utilisers of sound recordings resisted these changes by contending that because no amendment was brought about in the substantive provision conferring rights on authors of the works, no additional right could be sought to be claimed under the Copyright Act. The Bombay High Court has, however, cleared the waters by conclusively holding that authors have independent right to receive royalties for every utilisation of their works through broadcast of the derivative work.

Scotch Whisky Association v. JK Enterprises37

The Madhya Pradesh High Court (MPHC) rendered an important judgment in an appeal against an order passed by the Indore District Court, holding that a registered proprietor (RP) of a GI could not maintain a GI infringement suit in its own name till such time that an authorised user (AU) (person authorised to append GIs to its products by the registered owner of the GI, upon complying with statutory requirements under the GI Act) of such GI was also made a plaintiff. The suit was filed by Scotch Whisky Association (SWA), an association comprising producers, distillers, blenders, exporters, etc., of scotch whisky, native to Scotland, United Kingdom, for the global protection and promotion of the trade of scotch whisky, before a district court in Indore. The SWA sought an injunction against an entity which was manufacturing, marketing, and selling its whisky under the brand name 'London Pride'. The District Court ruled that the suit would be maintainable only if SWA were to implead an AU of the GI as well, based on the District Court's reading of Section 21 of the GI Act. The MPHC allowed SWA's appeal, carrying out a thorough examination of the relevant provisions pertaining to GIs under TRIPS as well as under the GI Act and the Rules framed thereunder, and found the District Court's interpretation to be erroneous. It held that, viewed from the perspective of the larger scheme of the GI Act, an RP could very well be considered an entity independent of an AU and that both the RP and AU had equal rights to sue for infringement of a registered GI.