Copyright Bill, 2010
The Year 2010 was a year for great discussion and deliberation for the proposed amendments to the Copyright Act. Though it looked at the beginning of the year that we would have the honour to read the Copyright Act, 2010 it appears that it is just in the chrysalis stage. We hope that it shall transform into an Act this coming year 2011.
We had earlier this year reported on the copyright bill and the proposed changes . Recently, the Parliamentary Standing Committee which has been asked to review the bill, hold discussions with stake holders and comment on the proposed amendments, has come out with a report which was presented before the Rajya Sabha and Lok Sabha on the 23rd of November 2010 suggesting changes to be made to the bill.
Following are some of the key changes suggested by the report:
- Principal Director as joint author: The Committee found that the proposal in the bill, to include the ‘Principal Director’ as a joint author of the film along with the producer, is unfair and should be rejected. The reasons cited by the committee in its report for this were inter alia as follows: “Committee’s opinion rests on the premise that there is a system existing presently whereunder producers and directors are free to negotiate on their own terms and conditions. Under these negotiations/contracts, directors are not only paid their negotiated salary/fee but also certain rights in perpetuity relating to the script. Further, as per the existing system, the principal director is not taking any equity risk in the production/performance of a film and it is the producer alone who runs the risk of his investment not being recovered.”
- Definition of the term ‘Communication to the Public’: The committee rejected the reservations of the stake holders to the proposed amendment to include the performances in addition to work in the definition of communication to the public. The proposed amendment is as follows: “making any work or performance available for being seen or heard or otherwise enjoyed by the public directly or by any means of display or diffusion other than by issuing copies of such work or performance regardless of whether any member of the public actually sees, hears or otherwise enjoys the work or performance so made available.”
The proposed amendment in the definition of the term ‘communication to the public’ has not found favour with the stake holders i.e. the music companies represented by the South India Music Companies Association, the RPG Enterprises Saregama, Indian Music Industry and also the Association of Radio Operators for India. Attention of the committee was drawn to the following factors having an adverse impact on the music industry and radio operators:
- subscription to caller tunes and authorized websites permitting streaming/downloading of copies etc. will be considered “communication to the public” in spite of it being a sale of the copy;
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no rationale in exclusion of only physical copies from the purview of “communication to the public” in an age where commercialization and sale of music is taking place extensively through the medium of internet and transfer of files through computers/blue tooth;
- creation of a transient electronic copy in the course of or for the purpose of “communication to public” under current law is treated as an infringement. While such act by a legitimate TV/Radio station would be lawful, the section will be misused by unauthorized websites treating it as an activity during the course of “communication to the public”.
- free radio broadcast which is a service to the public and is also in the interest of artists as it
- promotes their compositions will be brought under the definition. Therefore, the word ‘performance’ should be excluded from the provision.
- proposed amendment will be misinterpreted by certain quarters when even issuing “digital”
- copies would amount to ‘communication to public’. It would be wrong to consider digital sales such as iTunes as “communication to the public” In reality, it is only a sale, but on a different medium.
The committee was however of the opinion that “………. the reservations of the Stakeholders are unfounded. Issuing physical copies or legitimate digital downloading music or video recording by payment cannot be considered a communication to the public. The Department has justified the proposed amendment for exploitation of digital mediums. As the amendment is in tune with the technological advancement, the Committee accepts the amendment. The Committee is also of the view that the copyright societies can play a proactive role in resolving problems, if any, arising due to the proposed changes in the definition.”
- Definition of the term ‘Infringing copy’: The bill seeks to address the situation of parallel imports. The proposed amendment adds a proviso to the definition of Infringing Copy which is as follows
“Provided that a copy of a work published in any country outside India with the permission of the author of the work and imported from that country into India shall not be deemed to be an infringing copy”.
The committee stated that it was in favour of such amendment and added that it would be beneficial to student in being able to acquire latest editions of books at low prices.
- Assignment of copyright: The committee has accepted the amendments proposed in section 18. In clause 18 the following proviso was sought to be introduced “Provided further that no such assignment shall be applied to any medium or mode of exploitation of the work which did not exist or was not in commercial use at the time when the assignment was made, unless the assignment specifically referred to such medium or mode of exploitation of the work.” “Provided also that the author of the literary or musical work included in a cinematograph film or sound recording shall not assign the right to receive royalties from the utilization of such work in any form other than as part of the cinematograph film or sound recording except to the legal heirs or to a copyright society for collection and distribution and any agreement to the contrary shall be void”.
The committee stated inter alia that “the proposed amendments in section 18 will protect interests of authors in the event of exploitation of their work by restricting assignments in unforeseen new mediums and henceforth author of works in films will have right to receive royalties from the utilization of such work in any other form except to the legal heirs or to a copyright society and any other contract to the contrary shall be void”
- Mode of Assignment: The committee proposed amendments that would ensure better protection of the rights authors of the work particularly authors of songs whose works are included in films or sound recordings. One of the proposals included the author of a song i.e. the composer or lyricist receiving 50% of all royalties from the exploitation of the work as a part of the cinematograph work itself.
- Certain acts not to be infringement of copyright. And Compulsory licence for benefit of disabled: The committee stated “The Committee is of the firm opinion that all physically challenged need to be benefited by the proposed amendments. It would be very discriminating if envisaged benefit remains restricted to only visually impaired, leaving out persons affected by cerebral palsy, dyslexia and low vision. The Committee takes note of fact that even regular Braille users complement Braille with other accessible formats like audio, reading material with large fonts and electronic texts. The Committee also observes that the modern day Braille production is dependent on the material being first converted into mainstream electronic formats such as MS Word because Braille translation software requires inputs in such formats. The Committee hopes that the request of organizations for extending access of works to all accessible formats instead of special formats presently under consideration of the Department will result in a positive outcome. The other request for widening the scope of compulsory licence to allow other entities working for disabled in case it is not possible to withdraw section 31 B also merits a sympathetic consideration by the Department.”
Travelling Cyber Squatters
In a recent suit for permanent injunction before the Delhi High Court, the Hon’ble court granted an injunction against the cyber squatters “indiatimestravel.com” who were trying to pass off their services as that of the Plaintiff’s.
The facts are as follows:
The Plaintiff- TIMES INTERNET LTD is the owner of the portal http://travel.indiatimes.com and is also the owner of the mark “travel.indiatimes.com”. The plaintiff registered the trade mark with effect from 7th June 2000. One of the Defendants, Belize Domain Whois Service Ltd. registered the domain name “indiatimestravel.com” in 2005. The Defendants’ domain did not provide any services other than sponsored links on their website, links which if clicked would earn revenue for the Defendants.
The High Court drew a parallel between a domain name and a trade mark as was done by the Supreme Court in a 2004 case of Satyam Infoway Ltd. vs. Sifynet Solutions Pvt. Ltd. In his the well reasoned judgment, the Hon’ble Justice V.K. Jain quoted the Supreme Court’s decision in the 2004 case in which the SC stated – “The use of the same or similar domain name may lead to a diversion of users which could result from such users mistakenly accessing one domain name instead of another. This may occur in e- commerce with its rapid progress and instant (and theoretically limitless) accessibility to users and potential customers and particularly so in areas of specific overlap. Ordinary consumers/users seeking to locate the functions available under one domain name may be confused if they accidentally arrived at a different but similar website which offers no such services. Such users could well conclude that the first domain name owner had misrepresented its goods or services through its promotional activities and the first domain owner would thereby lose their custom. It is apparent therefore that a domain name may have all the characteristics of a trademark and could found an action for passing off.
As far as India is concerned, there is no legislation which explicitly refers to dispute resolution in connection with domain names. But although the operation of the Trade Marks Act, 1999 itself is not extra territorial and may not allow for adequate protection of domain names, this does not mean that domain names are not to be legally protected to the extent possible under the laws relating to passing off ”
The Hon’ble High Court found in favour of the Plaintiffs and ordered the Defendants to transfer the domain “Indiatimestravel.com” to the Plaintiffs.
Schering Corporation Vs. United Biotech (P.) Ltd. and Oscar Remedies Pvt. Ltd.
Bombay High Court in October 2010 dismissed an appeal brought before it by the US pharmaceutical company Schering Corporation and others, against an order passed by a Single judge of the Bombay High Court dismissing a notice of motion. The Notice of motion was one for grant of temporary injunction and had been filed by Schering Corporation and others in order to restrain the Defendants-Respondents from infringing the Plaintiff’s registered trade mark NETROMYCIN and from passing off the Defendant’s goods by using the trade mark NETMICIN.
The Single judge before whom the Notice of Motion lay found in favour of the Defendants on the grounds that:
- The Plaintiffs- Appellants failed to prove distinctiveness of their mark or packaging;
- The Two marks viz. NETROMYCIN and NETMICIN are not deceptively similar;
- There is no possibility of any confusion as the Respondents- Defendants goods were purchased in bulk by the hospitals and that the same were not sold over the counter, whereas the Plaintiffs- Appellants goods were sold over the counter and that the purchasers of the Respondents- Defendants goods have requisite knowledge and technical expertise in dealing with the drugs;
- The essential features of the Plaintiff’s- Appellant’s mark are different from that of the Respondent’s- Defendant’s;
- There would not be any adverse effect on the consumer since the chemicals used in both the products are common; and
- There were many medicines and pharmaceutical products being manufactured and traded in the market ending with the letters Mycin, Micin and Cin.
In the Appeal, after hearing Counsels appearing on behalf of both sides the Hon’ble Division Bench, inter alia, held:
“The Appellants have adopted their trade mark NETROMYCIN from the generic drug name Netilmicin. When a trade mark is found from the common generic name, no single proprietor can claim absolute monopoly in such name or trade mark. When a proprietor adopts a trade mark on the basis of name of generic drug or ingredient, it will be safe to assume that he is aware that the other proprietors are also likely to adopt and use similar marks in case their product is based on the same generic drug or ingredient. In such a case, the first user cannot claim exclusivity in his trade mark or in the name which is derived from the generic drug. At the most such proprietor can claim exclusivity in those added features which differentiates his trade mark from the name of the generic drug or ingredient. When two trade marks are coined from the same generic drug or ingredient, there are bound to be similarities between the two and in such a case, even if the differences between the two trade marks are minor or small, then also at least at the prima facie stage no injunction can be granted.”
The Hon’ble court further held “Since there is commonality in origin, ingredient, composition and purpose, even if one drug is consumed for the other, there cannot be disastrous consequences……… In our opinion, the manner in which the drug is administered and that the product of the Respondents is used only in the hospitals by the Doctors after carrying out sensitivity culture test, is enough to rule out any possibility of any confusion as the chemical used in both the products is same. Even if by mistake one is used for the other, no injury is likely to be suffered by the consumer or patient. In our opinion, therefore, this circumstance coupled with the circumstance that both the trade marks are registered and that from the year 2003 the Respondents have been using its trade mark uninterruptedly disentitles the Plaintiffs-Appellants to interim injunction restraining the Defendants-Respondents from using its trade mark.”
Knock Out not a knock off… or is it?
This year saw a controversy regarding the release of the movie ‘Knock Out’ starring Sanjay Dutt and Irfaan Khan. A suit was filed by 20th Century Fox (the owner’s of the copyright in the movie ‘Phone Booth’ starring Colin Farrell) against the makers of the movie Knock Out.
The Counsel for the 20th Century Fox (Plaintiff) alleged that the film Knock Out was copied by the producers, from the English movie Phone Booth. The Counsel on behalf of the Defendant SEMPL argued that the Plaintiff 20th Century Fox was claiming copyright over the ‘idea’ of a hostage in a phone booth, and hence no cause of action arose.
Justice Roshan Dalvi passed a stay order on the release of the movie Knock out after watching both the movies in the video conferencing room.
The order passed by Justice Roshan Dalvi was appealed by AAP Entertainment Ltd. (One of the defendants). The Division bench before which the appeal lay held that “…..we are inclined to grant interim stay during the pendency of the appeal. However, in the facts and circumstances of the case, we are inclined to impose a condition that the appellant must deposit a sum of Rs. 1.50 crores with the Prothonotary & Senior Master of this Court with a further condition that the appellant shall maintain accounts and place the same on record of this appeal.”
The point of contention is whether the movie Knock Out infringes the copyright in the movie Phone Booth or whether the movie just borrows an ‘idea’ from the movie? And this question remains to be answered finally by a court of law.
The law relating to copyrights lays down that one cannot claim a Copyright in an Idea/thought. Thus one cannot claim copyright in the theme of a movie but the entire script and the story will have to considered to decide whether or not there is a Copyright Infringement or not.
This case promises to be an interesting one and we look forward to seeing the final decision.
Estee Lauder loses trademark case against Gufic Biosciences
The Supreme Court in November 2010 rejected the appeal brought by Estee Lauder contesting a judgment passed by a Division bench of the Delhi High Court. The Judgement by the Division bench had the effect of dismissing the claims of Estee Lauder that, Gufic Bioscience’s use of the word ‘cliniq’ as part of its product ‘Skincliniq Stretch Nil’, amounted to an infringement of Estee’s registered trade mark ‘Clinique’.
The Hon’ble Supreme Court upheld the judgment of the Division Bench of the Delhi High Court allowing Gufic to continue using the word ‘cliniq’ in its product.
The judgment of the division bench of Delhi High Court vacated an earlier injunction passed by a decision of a Single Judge of the same High Court. The judgment passed by the Division Bench of the Delhi HC held inter alia, that: “the test of deceptive similarity in the case of infringement is the same as in a passing off action, where the marks are not identical; the question has to be approached from the point of view of a man with average intelligence and imperfect recollection. Further, in comparing the marks, it is the overall structural and phonetic similarity of the two marks that is to be seen and not by splitting them into their component parts.”
“In comparing “CLINIQUE” with “SKINCLINIQ”, what has to be borne in mind is the overall structural and phonetic similarity of the two marks and the marks cannot be separated into their components. Consequently, we have to take the mark “SKINCLINIQ” as a whole in comparison with the respondents’ registered mark “CLINIQUE”. When we do that, we do not find any overall structural or phonetic similarity.”
Clarity on Date of Grant of Patents
This year saw a heartening judgment being passed Delhi High Court. The Judgment was passed by Hon’ble Justice S. Muralidhar of the Delhi High Court and it dealt with 8 writ petitions. We had earlier reported on this Judgment being passed.
This judgment inter alia laid down that:
- On the date the Controller gives its decision to grant the patent, is the date on which the Patent is said to be granted;
- One cannot file a pre-grant opposition after the patent is granted
- final order granting patent has to be applied with a digital signature of the controller or the assistant controller and has to be “placed on the website of the Controller on the very same day without any unnecessary delay.”
- The High Court further directed the controller to start the practice of “publishing a ‘cause list’ of such cases under the heading ‘for pronouncement of orders’ the previous evening both on the website as well the notice Board of the Office of the Controller, just as it happens in the Courts.
TVS vs. Bajaj
The case that the IP and automotive world followed closely since 2009 still continues….. And it has not reached very far. The highpoint of the case in the year 2010, was that a Division Bench of the Madras High Court decided that TVS may start producing evidence first. A quick recap of the case is in order:
- In 2007 TVS Motor Company Ltd. instituted a suit against Bajaj Auto Ltd. in the Madras High Court. In the suit TVS inter alia, prayed that Bajaj be restrained from making groundless threats of prosecution for alleged infringement of one of Bajaj’s patents and also that the Court declare that TVS’s motorcycle branded ‘Flame’ did not infringe the impugned patent; TVS Simultaneously filed an application for the revocation of Bajaj’s patent before the Indian Patents Appellate Board.
- Bajaj filed a suit against TVS in 2007 and prayed for inter alia, permanent injunction against TVS restraining TVS from infringing the patent of Bajaj by selling, marketing and producing Flame; Bajaj also prayed for accounts of profits, payment of damages and delivery up of infringing material; 3.In February 2008 the single judge granted an injunction against TVS in the case brought against TVS.
- TVS appealed the decision of the Single Judge before the division bench of the Madras High Court.
- The appeal was allowed by the Division Bench of the Madras High Court.
- Bajaj being aggrieved by the decision of the Division Bench of the Madras High Court filed an appeal before the Supreme Court in 2009.
- The Supreme Court in its decision stated that “It is evident that the suit is still pending before the learned Single Judge of the Madras High Court. We are unhappy that the matter has been pending in the High Court at the interlocutory stage for such a long time as the suit was filed in December, 2007 and yet even written statement has not been filed” the court in its succinct order the Hon’ble Supreme court stated “…..experience has shown that in our country, suits relating to the matters of patents, trademarks and copyrights are pending for years and years and litigation is mainly fought between the parties about the temporary injunction. This is a very unsatisfactory state of affairs…” the Court thus directed “….Respondent-defendant to file written statement in the suit, if not already filed, on or before the last date for closing of the Madras High Court for Dussehra holidays. We would request the learned Single Judge who is trying the suit to commence the hearing of the suit on the re-opening of the Madras High Court after Dussehra holidays and then carry it on a day to day basis. No adjournment whatsoever ordinarily will be granted and the suit shall be finally disposed of on or before 30th November, 2009”
- The Learned Single Judge of the Madras High Court, framed issues in both the suits as per order dated 24 November 2009.
- The Learned Single Judge took up the preliminary issue as to who should let in evidence first. After hearing both the parties, the learned Single Judge opined that the infringement being the central theme in both the suits and even though the first suit proceeds on the validity of patent, to arrive at a proper decision, defendant (i.e. Bajaj) has to start with letting in of the evidence. Feeling aggrieved by this decision, the Bajaj filed two appeals;
- The Division Bench of the Madras High Court, before whom the appeals lay decided that TVS should first prove their case i.e. that their motorcycle or rather the engine of the motorcycle does not infringe the patent of Bajaj.