The Conundrum of Bifurcated Patent Litigation: A Few Thoughts More

In a few earlier posts, I had shared my thoughts on bifurcated patent litigation, but there is one aspect which I did not touch upon. In bifurcated patent litigation, one forum is seized with the issue of patent infringement and the other with the issue of patent validity. This creates a few more practical difficulties which I did not deal with in my earlier posts.

One such difficulty is that the court, which has to decide on the issue of infringement, has to also comment on the issue of credible challenge posed to the validity of the patent by the defendant. If the Court does indeed form an opinion on patent validity, even if prime facie and inconclusive, it is bound to affect the objectivity with which the IPAB approaches the issue of patent validity.

It is possible for the defendant/applicant for revocation of the patent, to invite the IPAB to draw adverse inferences against the patent on the basis of the court’s observations with respect to the issue of credible challenge. This could and ought to be avoided, however, if the IPAB as a matter of practice recognises that its jurisdiction on the issue of validity is independent and ought not to be affected by any observation the court makes on the issue.

That said, if the patentee’s stance before the court itself creates an estoppel, the IPAB would be well within its rights to take cognizance of such stance. To avoid such pitfalls, it would help if there’s a single forum which decides both validity and infringement, preferably a forum with technical expertise. 

Phone Booth rings a Bell- A Knock Out Punch at Mumbai High Court!

A few weeks back, I expressed my worry about “Inspirational Plagiarism”. To my delight, I was turned to a decision of the Mumbai High Court rendered in 2010, Twentieth Century Fox Film Corporation vs. Sohail Maklai Entertainment Pvt. Ltd., discussing a similar issue, albeit in the context of film scripts.

The extremely popular “Phone Booth”, produced by Twentieth Century Fox moved a suit against the producers of Bollywood flick Knock-Out, alleging infringement and praying for an injunction against the release of the movie and distribution of copies of the movie, in any manner. The decision reveals that several letters had been exchanged between Twentieth Century Fox and Sohail Maklai Entertainment Ltd., even before the matter moved to Court.

The producers of Knock-Out claim that the only similarity between the scripts is that “the guy is trapped in a phone booth”.

For our readers who have seen the English movie, will agree when I say that such “Entrapment” (and what a movie that was!) is central to the Twentieth Century Fox production. The judge, in cognizance of this fact, states, amongst other points of comparison:

"The conversation between the caller and the protagonist are rather similar; such similarity cannot be co-incidental. Its style as well as the content of the conversation and the design in bringing out the conduct of the man would leave an unmistakable impression that one was copied from the other. That is the basic concept of the two films.”

Further the Judge taking note of the differences between film making styles in Hollywood and Bollywood says:

“It is seen that the duration of both the films is rather different; though the first is long enough the second is far longer for the message it conveys. Consequently and naturally, the second has further and other aspects to convey and portray more specially the political drama with several more characters and scenes which are essentially embellishment and ornamentation in developing the expression of the idea or the prime thought of the first film.”

In the paragraphs that follow, the judge makes a rather interesting comparative:

“These ideas can be understood by the distinction of a discovery and an invention. Whatever is there but not brought out would be discovered; but whatever is not there is invented for the first time. The inventor would, therefore, alone have copyright in the expression of that invention which is the artistic work. Hence copyright is contained in the original expression of the idea. It is expressed in the frame of the product. It is the thought that is sought to be portrayed and conveyed which carries a copyright and not the original idea. Hence whilst the idea may not be unique to the author, the image portrayed or the expression made is essentially unique to the author. If such an expression in the shots of a film is copied, lifted from an earlier film, the infringement is complete.”

I think this paragraph sums up the view that the judge takes, rather succinctly and drawing an interesting comparative, while doing that! For those who worry about the rampant Inspirational Plagiarism like me.. Here Comes the Sun!

Of Markets, Exhaustion and Trade Marks..

A recent Delhi High Court decision, has left me rather perplexed! The decision rendered in Samsung Electronics Company ... vs Kapil Wadhwa & Ors, deals in exhaustion of rights vis-à-vis trade marks, and an associated claim of infringement. 

The decision leaves me taken aback for the interpretation that it takes on the legislation, albeit attempting to justify its stand, under the layers of dicta that guide legislative interpretation, and drawing international comparatives- both of which are, in my humble opinion, unnecissitated.

To summarize the 156 page long decision, the allegations made by Samasung, upon the defendants were that by way of parallel importation and lack of consent or authorization, the defendants sold the products, thus committing infringement as envisaged under the Trade Marks Act. 

Also by way of deep hyperlinking and meta-tagging, they had committed infringement and mislead consumers to believe the source of products to be Samsung itself. The court while determining infringement, states that the law of Trade Marks in India, follows the scheme of National Exhaustion of rights, which I am in vehement disagreement with.

For the benefit of our readers, the operative part of the provision governing exhaustion of rights is reproduced here:

30. Limits on effect of registered trade mark.—

3) Where the goods bearing a registered trade mark are lawfully acquired by a person, the sale of the goods in the market or otherwise dealing in those goods by that person or by a person claiming under or through him is not infringement of a trade by reason only of—

(a) the registered trade mark having been assigned by the registered proprietor to some other person, after the acquisition of those goods; or

(b) the goods having been put on the market under the registered trade mark by the proprietor or with his consent.

In discussing whether the mark has in fact been infringed, and whether the provision acts as a defence (or “limit”, in statutory language), the Judge looked at the use of the term “market” in its different forms – viz. “in the market” in the body of the provision, while “on the market”. The use of prepositions, 'in' and 'on' are construed as below:

“[O]nce the situation becomes clear about the import of the opening words of the section, then the said lawful acquisition due to the controlling words registered trademark must originate from the domestic market/ national market, and the subsequent wordings has to be also given contextual reading and the wider import of the same words "in the market" cannot be given to include "worldwide market"…

However, this makes little sense to me. The provision describing “use of a trademark”, under S. 29(6)(c) clearly qualifies “imports or exports goods under the mark”.

As a fall out, how can the term “in the market” or “on the market” be construed as being the domestic market? “Import” as we all understand means bringing “into one’s country” (I deliberately choose not to use the term market here, because, the two need not necessarily coexist!)

Another reason I refute this interpretation is the way the law of trade marks is designed to operate. While the law may be to grant territorial rights, it does not deny rights to register or apply for registrations to corporations outside India. One can appoint an Indian agent and have a body incorporated in a foreign location to apply for the mark. If “in the market” were to be construed strictly, as deliberated by the learned judge, then every applicant would have to furnish an address and accompanying proof of residency in India.

Additionally, as many of us would have encountered in our practice, one of the most concrete and reliable proofs of use,are invoices and bills of lading, to prove “use in India”. In this view, if exhaustion is only meant to be national, have we been wrong so far, as to advice registrants to maintain records of their voluminous shipping documents? If exhaustion of a trade mark was only meant to be “national”, then we would only have invoices from distributors or local subsidiaries.

To further attempt bolster as to why a trademark may originate from a registrant, having presence in India vide imports, is the fact that we have recognized the principle of “well-known trade marks” and accompanying secondary significance way too well in our jurisprudence. If law were to interpreted absolutely in a territorial structure, then what we are ALSO indirectly saying is that the opening up of our economy, as executed by the present Indian Prime Minister, (during his term as a Finance Minister in the 1990s), was superfluous!

Further in the judgement, the Learned Judge also reasons that :

“This is due to the reason that the word "market" is not qualified by any other word either in clause (3) or sub clause (b). It is just mentioned "in the market" and "on the market". Had there been a separate meaning ascribed to the word "market" in sub clause (3) and in (b), then there must have been a qualification before or after the word "market" in both the provisions which is not so present.”

I do not think the word market needs to be defined or qualified by another term, so as to monitor trade mark. The law of Trade Marks is for the consumers, who very clearly define the market - so long as demand for a product or brand exists, the market does. 

The Trade Marks Act, 1999 also carefully omits defining this term- for reasons beyond the obvious. “Likelihood of confusion” is also deciphered on this very basis constituting of trade channels, class of consumers, price disparities and the akin- something that you and I as the commoner would consider during our shopping escapades.

All in all, I think this judgment clearly misreads the law. I shall revisit the judgment soon for a fresh take. In the meanwhile, I hope that we will hear from our readers on what they think of this ruling.

P.S. Thank you to a dear friend of the blog, for pointing this decision to me.

Indian Patent Office and RTI applications: Is There Scope for Improvement?

In the recent past, quite a few practitioners who I've had the opportunity to interact with, have mentioned on more than one occasion that the Indian patent office is not particularly responsive to RTI applications. Considering the transparency overdrive that the intellectual property office has been in the past few years, this is indeed a surprising feedback. 

I, for one, would have thought that prompt responses to RTI applications would have been one of the first points of emphasis in an effort to bring in transparency to the Indian intellectual property establishment. It appears that the promptness of responses to RTI applications is not uniform across all offices. It also appears that there is no consensus among the four patent offices as to what can legitimately form the subject matter of an RTI application.

It would probably help to issue guidelines in order to avoid a flood of frivolous applications and to promptly respond to permissible applications. A few questions arise in this regard – can RTI applications act as substitutes to inspection of files at the office? How does section 153 of the Patents Act interplay with the scope of subject matter that can be sought in an RTI application?

Also, is it permissible to seek information in an RTI application with respect to the contents of published documents which are available for inspection by members of the public? It is my humble opinion that practical issues like these must be addressed by the patent office on a regular basis since that would help applicants and practitioners save time by understanding the options available to them.

So far, there has been very little analysis of the manner and uniformity of responses to RTI applications by the Indian patent office. An empirical study, however brief, would help throw light on the effectiveness of RTI applications as a means of obtaining information from the patent office. In the meantime, we request our readers to share with us their experience in filing RTI applications at the patent office and their suggestions for improving the prevalent situation.

Any room for Inspirational Plagiarism?

I think aloud as I listen to one of my favourite George Harrison/The Beatles numbers “My Sweet Lord” - I am reminded of the plagiarism suit that went along. Someone as great as Harrison was not excused, although he admitted that he never had “He’s so fine” on his mind, while composing My Sweet Lord. More about the row here.. My personal opinion, is that the judgment was a bit harsh.

And then, as much as a Bollywood loyalist that I am, I often wonder, can “inspiration” be really an excuse to copy music??? Although I hate to admit, the fact is that I often find myself listening to new songs, and I know that the riffs, chords, et al. are a pick up from some old song. The first one was as a very young child, listening to the inspirational version of “The Final Countdown” and the most recent one being last night - a Boney M rip off..

As I think of it, since copyright is apparently a pan-jurisdiction right, thanks to the Berne convention and non-requirement of registration, National Rights should be applicable to enforce such rights violated out of such “inspiration”.

Assuming a plausible situation, where an international artist came about to enforce rights against an act of “Inspiration” in India, “fair use” would be an obvious defence taken up in the issue. However, if we carefully look at the Act, S. 52 dealing on Fair use, titled “Certain acts not to be infringement of copyright”, covers Parody and not “inspiration”. That apart, whether rights have been violated to the extent of being “infringement”, is one meant to be decided on facts.

That having been said, it appears that irrespective of a case for infringement having been made out or not, would violation of moral rights stand a chance? I believe it would! Section 57 under the Copyright Act, 1957, reads:

“Author' s special rights. Independently of the author' s copyright, and even after the assignment either wholly or partially of the said copyright, the author of a work shall have the right to claim the authorship of the work as well as the right to restrain, or claim damages in respect of,-

(a) any distortion, mutilation or other modification of the said work; or

(b) any other action in relation to the said work which would be prejudicial to his honour or reputation…”

For a jurisdiction that in fact does give prominent weight to the violation of moral rights, I wonder why we haven’t had many cases in Music covering such “inspirational plagiarism” as I would like to call.

Though the idea-expression dichotomy would prevail as a premise, yet these cases should find a favourable verdict for copyright owners. Knowing the caliber and musical inclination that our judges have, in making line by line comparisons, the cases shouldn’t be a difficult slide.

On a funny note, a friend of mine and I discussed how one particular "original song" had been converted to a Devotional number, by replacing the lyrics. We discovered this on our school trip in Grade 4. And he asked "What would the Divine Gods do? Which Court would they approach?" I but of course had no answer, however this is definitely a point to consider!

Use in a Trademark Sense and Passing Off : Is the Law Clear?

Popular discussion associates infraction of trademark rights with suits for passing off and infringement, with the general distinction being that the former is instituted in the case of an unregistered trademark, and the latter for a registered trademark. The result of this popular association is that it is always assumed that an action for passing off is one which must and necessarily involve the use of a trademark.

What must be understood is that a trademark action, be it for passing off or for infringement, is one that ought to involve use of a trademark in a trademark sense. In other words, the mark must be used as a source signifier.

It is interesting that the law of “trademark passing off” combines actions in equity for reputational harm with principles governing identity and source signification under trademark law. This is precisely why an action for trademark passing off requires:

1. existence of a reputation worth being “passed off”; and

2. the very act of passing off

That said, what constitutes the “act of passing off”? Is the act of passing off limited only to those instances where a mark is used in a trademark sense? Or does it extend to all instances where use of the visible face of the owner, may not amount to use in a trademark sense, but still gives rise to association with the owner? 

If it is the latter, should an action for passing off limit itself only to the first situation i.e. use in a trademark sense? If no, and if it extends to the second category i.e. all situations that give rise to association, can the action be called an action of “passing off of a trademark” or would it be a “pure passing off action”?

I am inclined to go with the conclusion that a pure passing off action lies even if use of the mark is not in a trademark sense. That said, I am still not sure that the law on “use in trademark sense” has been etched in stone for all time to come. I think there is still a lot of scope for including hitherto un-encountered situations.

For the purposes of this discussion, let’s take an artistic work which is protected by a copyright, and is also used as a device trademark by the owner of the work. Let’s assume a third party uses the artistic work on his goods, but not in a trademark sense. It is clear that an action for copyright infringement can be made out without much difficulty, but since the use is not in a trademark sense as it is understood today, principles of trademark violation may not be marshalled to allege passing off of the trademark.

Does this mean the owner cannot allege passing off at all? I think it is perfectly possible for the owner to allege “pure passing off”, on the basis that the artistic work/character itself has acquired immense reputation and association with the owner. Therefore, use of the character/artistic work, even if not in the “trademark sense”, amounts to free riding on the reputation of the owner. This is passing off in the strictest sense of the term, which is incidental to copyright infringement.

The above illustration is easier to analyse thanks to the presence of copyright infringement since it involves an artistic work. But, what would be the conclusion in situations where the work is not protected by copyright, and the use is not “trademark use”, but has immense secondary significance to bring about an association with the owner in the minds of the consumer?

For instance, let's take a word mark. What kind of use of a word mark would not constitute use in a trademark sense, but may still give rise to association in the consumer's mind? I can’t seem to think of an appropriate illustration. May be our readers could help us think of the appropriate example.

In the mean time, readers could take a look at this US judgment which is relevant to the discussion, and was brought to my attention by a friend and colleague when I shared my thoughts with her.