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Enforcing Intellectual Property Rights in India
When we talk about the Intellectual Property and we want to understand what it is? - I would define it by saying that it is a property, which is creativity of mind. What you create by using your brain, by using your faculty, by using your mind and whatever is the result or whatever is the form which comes out of that, it takes the form of a property, which may be visible or which may not be visible, and that property is called an Intellectual Property, is basically the creativity of mind, as we said. It could be in the form of an invention.
How do you create an invention, how you invent something, because you are using your mental faculty according to your own knowledge, accounting to your own expertise, according to your own technical background or educational background. You may create something, a good mechanical device, you may come out with some new formulation or some product or you may be good author, you may write novel, you may write a story. That is again, you are using your brain, you are using your intellectual capacity and capability or the faculty to create something. You may be a musician, you may think of some good music, you may compose a good music, you may make a Cinematographic Film, you may develop good software, so therefore, whether you are creating an invention, which is good for the industrial purpose, or you are, as an author, you are creating some artistic work, you are making some good painting, that is again you are using your mental faculty, to create something new which is something creative, creativity of mind, and some people say that in trade mark what is creativity. In a copyright matter you create something because you are writing, you are composing, you are making film, you are making a picture but in trade mark what is the creativity. I say that there is a creativity because when you produce something, you have to give it a name and you have to think on it. What kind of name you should give it, what kind of name you give it. Trade Mark, which would add a value to your product, because ultimately that name is going to be an ambassador to sell your product, initially in the market and gradually it will acquire a reputation, and when it acquires reputation now that becomes or that plays a role, a very important role to your enterprise, to your industry for the growth of your industry, for the profitability of your business, so there is also an element of creativity when you are selecting a trade mark. I will deal with this issue when we select the trade mark, how do we come about it so just to give a back ground that it is again related to the creativity of mind, whether we talk about Patents, we talk about the Copyright, we talk about the Industrial Designs or we talk about the Trade Marks. In Industrial designs also, when you think of something new, a novel, a Design, which is appealing to the eye, which looks very attractive, which adds to the value of your product, which is esthetically looking good - that’s again you somebody has to think of it, somebody has to draw the line and somebody has to say what kind of the structure or the shape or the configuration of the product should it mean. So the bottom line, if you look at it from the angle is that for the creation of any kind of Intellectual Property, there is always and use of your mental faculty and i.e. a form i.e. the result, which is given because of the use of your brain, which takes the form of your Intellectual Property.
Now, the question is that, it must have been discussed yesterday and today, that the relevancy of the Intellectual Property to the industry. I will say that Intellectual Property, as I said, is an ambassador for your product. Ultimately, your products are known, ultimately your products are sold or they acquire reputation in to the market by a particular name or a feature or the utilitarian value. The name, which you select for your products, that name with the passage of time, acquires a reputation and it is that name by which your product is known. It is demanded and that is how it plays a role of the ambassador because it is something to the name, the reputation is attached and that reputation is ultimately attached to the quality of the goods, which are being manufactured and marketed by you under that particular name. So, therefore, it plays very important role. Now, the relevancy of Intellectual Property, to some industries it could be only a Trade Mark, to some industries it could be only a Patent, to some industries it could be a mixture of all four. It is not necessary that the relevancy of each segment of the Intellectual Property Design, Patent, Copyright, everything would apply in every case. To a specific industry, may be you have a protection of a trade mark, copyright in some of the industry, it is only be a design or is a question of some kind of new invention and in new invention you have subject matter of certain patents or all that.
The question, which is quite often mixed up by the industry when they come to us. Somebody, will come to us and say I want to get my trade mark patented is lack of awareness because the distinction, you must understand that, when we talk about an Intellectual Property, we say that alright, we have understood it is something, the question then arises is, what I have created, what form and under which legislation, under which law I get a kind of protection of that Intellectual Property. Now, the mixing up of trade mark to be patented, lets the language which is used for the trade mark is sought to be patented, for that generally, I give one example which the people do appreciate and they do not forget that business is distinction, it is a clear demarcation of all rights, which arises under different legislations. As we say that the Intellectual Property is the Trade Marks, Copyrights, Industrial Designs and Patents and I give an example with a human body to illustrate my point and it will answer many questions.
“When a child is born, how do you describe the child, a newly born child – how would you describe - either you will say a boy or a girl, a child, I said a child is born you said a boy or a girl, so you are referring to the child with his or her general description - a boy or a girl –
That is what, you are doing, as compared to that, there is an industrial house, there is an industry you produce an article whatever be the article. You may think of any thing, it could be tooth paste, it could be tooth powder, it could be Face Cream, it could be anything of merchandise. How would you describe, you are producing what - you are producing say ABC tooth powder or tooth brush i.e. the description of what you are producing.
Now on this side is boy or girl, what the parents would do. First thing to give name to the child. Now the name, which is given to the child, it is that name by which that child will be known, recognized, called, identified throughout his life.
Similarly, the manufacturer gives a name to the product, and it is by that name that product is known, demanded, recognized throughout the life, means so long as the goods are being manufactured and marked by the producer. You go to a shopkeeper, you say I want a toothpaste, what will be his next question – which one, you have to identify.
Now, on the other side, if you talk about a person, you say, I met one person, is very vague, which one, whom - you have to name, the moment you name that person, yes, yes, I know I met Dr. Zayed, so I say, when I went to Geneva, I met one gentleman. So, is all way, his description, whom, whom did meet you, so, you met such & such person, you are identifying the person with a name.
And, it is same role, which a trade mark plays vis-à-vis your product - Your product is known, recognized, demanded by that name. Now this is - what is called an association of a name with a particular product or with a particular source of manufacture? So, when we talk about source of manufacture, throughout your life, you say I so & so , you give your name, which is your identity, and son of, is always there, that is the source. So in production in the Industrial House, you give a source, which is an indication that you belong to this house, you come from this family, of the parent is a clear identification.
Now, what next - what do you do next - child is a born, name is given. You give a dress to the child now that dress, similarly, the producer of a product will give a dress to the product. You have given name, name is performing one role for identifying the product, but dress is playing a different role because you are covering your body; and here we are talking about our dress, there we are talking about trade dress, so, that is called trade dress in which you pack your product, you market your product and that is exactly what you are doing as a producer, you have produced generic product, which is known by its name, you have given it a name by which you want your product to be identified and, you have given it a dress, which is called trade dress. Now, when you give it a trade dress, now here it can perform two roles - one is trade dress itself also plays the role of a trade mark for identifying your goods or the trade dress is composed of a very distinctive or artistic patterns flowers, colour combinations, which as an artist, somebody is sitting as an artist, he makes the designs. In the fashion industry, patterns are made, designs are made for our dresses. We like a particular colour combination for our dress, the other one I may not like, so therefore, it is the colour combination, get up, lay out, which is composed of some features, which is again a creativity of some artist, who have sat down or who has created that design and that has resulted into a trade dress for the product and a normal dress, for human being. Now, when we talk about the get up, colour combination arrangements i.e. something, which an artist has created, which go within the domain of the Copyright Law. Now, in this example, which I am giving you, the Copyright’s artistic rights qua artistic works covered into this, though the scope of copyright law is much wider because copyright covers many other things, but in this example only the artistic work, which is comparable to the trade dress i.e. which fix in to this example. Musical work will not fit into it, or may be I try to put it when the child cry and he gives a sound and that sound is a musical work. Therefore, in this example just take up to the extent of an artistic work. So, there is a clear distinction between Trade Mark and Copyright. What Trade Mark is playing a role is different from the Copyright, a slight overlapping, where you say, even the trade dress may, to some extent in certain cases, may also perform the role of a trade mark for the purpose of identifying the product, is quite possible.
Now, come to the third element. The third element is shape and configuration. Now, the child, we were talking about, a newly born child, to whom we have given name, we have given dress. Now the shape and configuration of every person, everybody is unique to himself and herself. Now sometimes that also plays very important role, shape and configuration of a body of a person. Similarly, in an industrial use, that also plays a very important role because if the shape and configuration of the packaging material, in which you are marketing your product, is attractive and is appealable to the eye, you get attracted to it. You get attracted to human beings too, because of the physics. Somebody looks beautiful, somebody looks very handsome, so you get attracted with regard to shape and configuration. Now the shape and configuration of a person has got nothing to do with his or her name. It has got nothing to do with his or her dress. It has got to do something only with regard to shape and configuration, which is visible to the naked eye - what you can see. So, therefore, that when we talk about shape and configuration, which is visible to the naked eye, what we can see is the domain of Design Law. It has got nothing to do with name. Whatever may be, my name, you see me, my physique, my body. It has got nothing to do with my trade dress, but it has got its own distinctive, attractive feature of shape and configuration, visible to eye, nothing to do with anything else.
And the Fourth element is - that you know my name, you know my dress, you know my physique but there is some mechanism, which is going on inside, some process is going on inside. Machine is working and what is this machine doing, this machine is giving a performance, which you cannot see - what is happening inside but because of that performance you see the result, you see the utilitarian value, you see what is output, and if it is a process, process everybody has, but the utilitarian value of that process will vary from person to person and what knowledge do you have, in which field the knowledge do you have. I may be a good performer, I may be able to give good output if it is a legal question. I am not a scientist. But Scientist will give a different performance of his knowledge and background and output, which is of utilitarian value or which is of some functional value. Now when we talk about a performance, when we talk about a functional feature, which has resulted into something and output which has a utilitarian value or a functional value that is the subject matter of a Patent. Now there is no overlapping if you look at these, now the four segments, to my mind I don’t see any overlapping or mixing-up and to say, please get my Trade Mark patented or Design patented or Copyright patented. So, therefore, the distinction between the four segments of the Intellectual Property laws or the rights, which you acquire, must be borne in mind for what purpose, the purpose is that you are in a particular industry, whatever you are doing or whatever you are producing or marketing, you must know that what kind of Intellectual Property I have in my business. Some people do not even know what they are doing. In fact they have an intellectual property, but they are not conscious of this fact that no. 1- I have an intellectual property and no. 2 if I have an intellectual property, which intellectual property do I have and how do I protect it, at the first stage. How do I protect? And Fourth point will come much later. So, you must know this is the Intellectual Property, which I have and this is how I have to protect it. Now, when we come to the question of protection, now in each of these segments, the first question, which will arise is, how do I acquire a right in an Intellectual Property.
We have understood alright, the distinction between these names, artistic works, design and a performance or a process in the patent, but the question is how do I acquire a right? Now, I will take Trade Mark first. In trade mark you acquire a right if you are first in adoption and use of a name for your product. The moment you adopt a trade mark for your products and use it, if you use it in the course of trade in relation to your vendible product, reason being, because it is the association of that name with your product. Unless you market them, there will be association by the consumer with your product. So, therefore, it is the name, which you give it, it has got association with it. The moment you adopt it and use it in the course of trade, you acquire a right irrespective of the fact whether you have gone for the registration or you have not gone for the registration. Some people do feel that unless my trade mark is registered I do not get a right. That’s wrong. You adopt the trade mark today and you start today using it in the course of trade and after 10 days, one week somebody copies your brand, you protect it, with registration or without registration. So, the right is acquired, you have created an Intellectual Property and that what you have created, the bottom line is, you are prior in adoption and use. If somebody is using it that means you have copied somebody mark, you have copied somebody’s name. Then it is not your creativity and if it is not your creativity, no intellectual property subsist into that, no right subsist into that. So the priority in adoption and priority in use is the basic fundamental criteria for acquiring a right in a Trade Mark. So, when we talk about Trade Mark now, the right is acquired, you acquired a right, today. I become the owner of a Trade Mark and the right vests in you, that is called common law right. In law, in the legal terminology, we say that this is a common law right, which is acquired by use. Similarly, now, when I say the trade mark, I am going to say that, it includes service marks i.e. the business name, the same principles apply to the trade mark, trade name or a business name or a corporate name so that the rights are acquired, if you are prior in adoption.
On the one hand we come to the copyright law, under the Copyright Law also, the moment original, the question is original work is created. The moment you create an original work, now when I say work, it could be an artistic work, it could be a literary work, it could be a musical work, it could be a cinematographic film, it could be a computer software, but here again you see, what the bottom line is, it must be original. It must have originated on account of exercise of your own mental faculty and that if it is original, the moment you give this a form, you have an idea in your mind, you have a very good story in your mind that this could be a good theme for a feature film, that is your idea, that is your concept - but when you give a form to the concept, when that idea is converted into a form that Copyright subsist in the form, not in the idea. Because my idea may be the same, your idea may be the same, but I express that idea into a different form. May be, I as said at the beginning of my presentation, I said that the subject is same, what is Trade Mark, definition is same, idea is the same, law is the same, but the question is in what form, what form, have you given it to that subject and it is the form in which I may have my independent Copyright. If somebody else comes and speaks on trade marks, he or she will have an independent copyright into the form in which it is being presented. So, the copyright is not what a trade mark is. But copyright is how to explain what it is. So it is the form, which has been given differently by different people. Now today, if everybody is to write down what I am saying, the idea is the same, the principle is the same, the concept is the same, but if all of you have written down what I have said, you will express it in your own form, so, when you express it in your own form, each of you have a Copyright, the moment you give it a form, taking a source, taking an idea from, may be a common source; is no Copyright in an idea.
Somebody, goes to Taj Mahal, makes a painting of Taj Mahal, a good artist, he has a copyright in that painting that does not mean that somebody else can’t go to Taj Mahal and he can’t makes a painting, he can make a painting, so each and every artist, who makes a painting has an independent Copyright into his painting because it is the form which he has given, but if somebody has not gone to the Taj Mahal, he has seen one picture on a calendar, he said, it is a beautiful picture of Taj Mahal, let me it copy it and make it on a canvas, so if you are taking it from picture to picture and making a reproduction in any form that is an infringement and that is not an original work because you are copying it from somebody else’s existing work. And if you are copying it from somebody’s existing work, no Copyright will subsist because again the Copyright will subsist if it is an original work.
So, the originality, so we have seen in the case of intellectual property vis a vis trade mark, the priority in adoption means I am the first to adopt. It means you are original; you have not copied somebody. In copyright again, the issue is that you have not copied somebody’s work, you have created an original work, so that is the original work, which has been created. Similarly, when we come to design, now, Industrial Design, now here I would like to create a division between these four legislations into two departments - one is Trade Mark and Copyright on one side and Industrial Design and the Patents on the other side, on the question of how do I acquire a right in it.
In Trade Mark, I said I acquired a right, the moment I adopt it and use in the course of trade, I acquired a right. In Copyright, the moment I adopt and use it in the course of trade, I acquired a right in Copyright.
In Design and in Patent, you have conceived a very good design, shape and configuration. You have come out with very a good invention. You have invented something new. Right is acquired by you in that invention but that right is not recognized by law until and unless you have been granted a Patent or a Design by the Patent Office. You say that this is a Design, which I created, which is absolutely original, you may be right. You may say that I have come with a process for Industrial use, which is very good and it gets a better utilitarian value to the product or functional value to the product – you may be perfectly right. You have created something but your right will be recognized by law provided that right is granted. When a grant is made by The Controller of Patents in your favour with regard to that invention either under the Patent Law or if it is a shape and configuration of the Design Law. So, this is the clear distinction. Here, in two legislations, you acquire a right, which is enforceable in law on account of your first adoption and use of original creativity, on the other side you acquire a right but that right is not enforceable in law unless and until your right is recognized by the statute, by the law, by grant, by registration, by the grant of Patent certificate or by grant of Design registration certificate. So, therefore, you cannot enforce that right. Now, quite often this question, which has come from you that if I acquire right in Trade Mark, if I acquire right in Copyright, the moment I adopt a mark, I can use it, this is my property, this is my ownership, why should I go for its registration. The question there is that the registration of a right, you have a right, law recognizes your right and you can enforce that right, the registration of that right is for the purposes of facilitating a remedy for enforcement. Now, I give you a very simple example on that.
You are living in a house. You say that I am the owner of this house and in fact you are, but you don’t have a title deed in your name, you do not have a sale deed in your name but you are the owner of the house. May be you are claiming ownership on the basis of an adverse possession. I have been living in this house uninterruptedly for more than 20 years, nobody has disturbed me; nobody has asked for rent, nobody has come to me to say why you are living in this house, why have you occupied this house for the last 20 years. So, for about 20 years, I am living in this house. Somebody, all of a sudden comes in, I can enforce my right by saying that I am the owner of this house because of my adverse possession, uninterrupted adverse possession for 20 years and in the case of dispute; you are in the Court of Law. The Court says alright, I will recognize your right to ownership but you have to prove it that you are living in this house for 20 years. You have to prove it – by what – produce your Electoral Card, produce your Ration Card, produce your Telephone Bill, produce your electricity bill, produce your postal correspondence give all kind of evidence, which show that you have been living in this house for 20 years and it is on that basis, assessment of that evidence what you produce, the Court will say, Yes, I find sufficient evidence to show that you have been living in this house for 20 years. Therefore, you are the owner of this house, so you have to go through that process. BUT, if you had a Sale Deed in your name, what would you do, you put the Sale Deed straight on Judge’s table, you says it is my sale deed, matter ends. Now in a Trade Mark you become owner but when you want to enforce that right in the Court of Law to get the remedy, you will say, Sir, I adopted this mark in 1960. I have been using it for the last 47 years, I have been advertising it and this mark I was the first to adopt because priority is to be established and therefore please protect my right, facilitate a remedy, give me a remedy against the person, who has copied, infringed or imitated my mark. You have to prove all that, you have to prove the sale, the use, the reputation, advertisement, each and every component which is required to prove that you have, in fact, been using it and publicizing it, BUT if you have a Registration Certificate in your hand that is the prima facie evidence of your title, of your ownership that this is my title, here is my registration certificate, here is the certificate, which I am the owner and somebody wants to challenge that right, he has to go through the different process of law to challenge my right. So even a Sale Deed can be challenged that you have another property, somebody holding the registered Sale Deed, he says that I challenge because you have fraudulently got this house transferred in your name. Because I have been the owner and same when somebody says it is my trade mark which I am the owner on account of priority of adoption and use and use wrongly got registered in your name and so your registration is bad and it should be cancelled and this property should be reverted back to me. The same principle applies in Intellectual Property laws as in a general property matter. So, therefore, it has helped you, it has facilitated the remedy for the owner, for the industry. It becomes easier for you to enforce that remedy, which is called statutory remedy. One is a common law remedy and other is a statutory remedy. Whether the law is recognition and if that recognition is there you can go to Court. It is question of evidence, when you are enforcing your right, the Court will see evidence. Both the parties before the Court of Law, in any litigation when you go before the Court of Law, both parties say I am the owner, both of them are saying – I am the owner, how would the Judge decide, On evidence, and then question of evidence, the burden, the onus is heavy on you, if you are not holding of registration. If you are holding a registration of 1960 supposing that you had adopted the mark in 1960 and you had obtained the registration in 1960, it bears date of 1960 of Government of India, you say here is a mark which I adopted in 1960, I got it registered in 1960, here is the certificate, which is an evidence of registration that I have got it registered in the year 1980, this is an evidence. As against a person, who may have adopted subsequent to you and what kind of evidence, he will say alright whatever is actual sale or actual use. So here is the necessity for obtaining the registration of a trade mark or even in Copyright, now coming to Copyright registration - in Copyright also the registration is not compulsory. Trade Mark registration is not compulsory. The law does not say that you get it registered, then only you will get a right - NO. In Copyright also, it is not compulsory that you get your work registered then only you will get a Copyright – NO. The criteria of law is it must be original work and it must be priority in adoption i.e. the criteria and that is your right, which is enforceable in law. But now when I say enforceable in law, the question is what is the degree of evidence you need to prove your right, if it is unregistered, so you can go by that. Under Design and under the Patent law your right of invention, you have made an invention you have created something new, novel and original that right will have to be recognized by the Government under the law. You have to move an application for registration of a Design, have to, you have to and you have to get Patent granted by the Controller of Patent, before you say here is my title and now I can enforce it. The second important distinction between these 2 set of legislations is that in the first case we are talking about the priority in adoption, if I am prior in adoption and use, from registration, my right is superior, in design and in patent matters, if your invention is disclosed, prior to the date of your application in which you make a claim for the grant, your right is lost.
I will explain this, you come out with a new invention, you make a new design and you make a disclosure of that design to the public before making a claim for the grant or recognition of your right under the law that before filing an application for design or before filing an application for the grant of a patent, you make a public disclosure of that invention, which is genuinely your invention. I assume that it is your invention and is a genuinely your invention and you had created something new in the form of Intellectual Property but if you do not apply for registration and before that date of application you have already made a disclosure and the disclosure could be in various forms. The disclosure could be – you have already started manufacturing and marketing your products, products are known in the market, you have advertised in the magazines, you have displayed it publically, you have made Commercial use of it, so that is a disclosure of that and the law says in the Patent law and in the Design law if on the date of the application it is not new that means on the date when you are going to the Patent office, the invention was not new, it was already known one day before and if it was known one day before, it was not new or original, it has to be new and original on the date when you make an application and if you have disclosed one day. This reminds me a case, I saw, the name of Mr. Mukesh Aggarwal – Hotline, I think. The best example, I can give you in this case Super Flame came out with Gas or Stove, which was unique for the first time they had come about, no denying about, it was in 80’s. A good design, a new design created by Super Flame. The application at that point of time for the grant of design, industrial designs, all applications were filed at the Patent office in Calcutta not in the Zonal Offices. Normally, you take 2 days, 3 days time that from here if you are sending some documents to Calcutta by mail it will generally be delivered, presumption is 48 Hours, you add another 24 Hrs. and you take a margin of 3 days that it would reach the Patent Office. The application was mailed to the Patent Office for design, keeping a margin of 3 days, the 4 th day the big advertisement, it was a launching, a kind of publicity that this is a new product, which we are putting into market – full-page advertisement appeared in all leading newspapers. Unfortunately, the mail got delayed by a day and the date of the application was one day subsequent to the date of advertisement. There was a litigation, Super Flame filed a case against the Hotline they copied the same design and the defence was that on the date of the application this design was not new because it was disclosed to the public by your own advertisement, it is your advertisement and you cannot deny that and the right was lost. Now this is a disclosure, one day disclosure by even yourself, the novelty is lost, the newness is lost. So, to your industry if industrial design is of an importance to you, if some invention has been made with regard to a process or a product or mechanical device in which you think that you have created an invention and you have an Intellectual Property in to the form of Design or into the form of a Patent, must ensure, you must ensure that, that right is claimed before any public disclosure is made, because by making that kind of public disclosure, you will be losing your right into that. Now coming back, reverting back to other priority in adoption and use.
Reply to a question :
Grant may take six months i.e. is the date of application because when it will be granted to you, it will be from the date when you filed an application, so the right will be granted and renowned from the date when you have filed an application. It is the question of filing date, if you have filed it today, the Controller may take six months, he may take nine months, he may take one year. You can immediately start marketing and making public a disclosure of your product immediately after the date of filing i.e. the crucial date, even for the patent you have a curial date of filing. So, that is the most crucial thing that what is the date of your filing and all these legislations, all these rights of your intellectual property, you must understand that they are territorial, they are territorial, they are not extra territorial. If you have a patent, which is granted to you by the Government of India, Patent Office you have right in that invention, enforceable right in India. It is not an international right; it is not something that you can enforce your patent granted in India in any other country, unless and until you have patent in that jurisdiction granted to you in accordance with the Law of that country. So, we have international convention, we have international treaties because the question arises that if the law is that you cannot have a patent or you cannot have Industrial design for an invention or a new shape or configuration, if there is a public disclosure already made, then if you are filing an application in India today, your application, you may not be able to file in all other jurisdiction, where you may be exporting your goods, where you have a market in the other countries in the world, so on the same date it may not be physically possible for you to do that. Now there comes the international treaties, which are administered by the WIPO, which gives you an advantage of the priority date that if you have an application filed under the Tariff Convention under PTC, a treaty, you have a date, priority date, is preserved and you are given a period of time of filing a PTC application, you get 30 months in some countries, 31 months in some other countries. You get 2-1/2 years to think that in which country you want to go and file a patent application and that patent application will not be considered as a bad application on the ground of your earlier applications in other jurisdictions. So therefore your priority is retained with regard to that. You can still say that my first application was filed on such & such date in India through the PTC treaty and these are the countries of my interest, which I have specified that these are the countries, where I would like to claim my right. You have sufficient period of time 2-1/2 years, you can think, you can decide, which market is good economically as a good market potential for your product, where you would like to protect your right. So, therefore, the question there was that it is a territorial, it is not extra territorial. It is not something that your right is granted here it will go in a patent matter or design matter. But when we talk about trade mark and copyright, so, law is different on this aspect. On each aspect, you have to examine that what is the law and how you would distinguish of these four legislations.
In trade mark, the statutory rights are territorial when you are getting registration, you have to go to each country to get your mark registered but your Common Law rights are not necessarily territorial. It may cross-borders. Your rights may extend to Cross-borders, provided there is a reputation attached to it and which has traveled. Now, the reputation can travel. How it can travel, transfer, I will give you an example of a case. The famous case in India on this issue, a case called Whirlpool case in which the Whirlpool Corporation of USA, they had been using the trade mark Whirlpool for domestic appliances in United States and in other countries of the world, priority of adoption and use, now follow that guidelines, priority and adoption and use made in the United States by Whirlpool acquiring a reputation, association of the mark Whirlpool with the particular manufacturer, with particular kind of goods establishes in United States and that company had no interest to do business in India, they had registration of the trade mark obtained in India in way back in 1950s. But after 1950s, because of one reason or the other Government restrictions at that point of time and all that, the company decided we have no interest in the Indian market and the registrations, which they were holding in India, they were abandoned, they did not renew it, they gave it up, so it was a clear intention of having no intention to do business in India. When the liberalization started, the interest of the company was revived, big market, Let us go back. When they decided to come back in India in between there was an Indian Company, who had already obtained the registration of a trade mark WHIRLPOOL in India because earlier registration had gone. Indian Company thought it a good mark and registers it for the same products in India. Foreign Company has no intention to come to India and now all of a sudden, the foreign company’s interest is revived into the Indian Market and when that interest is revived into Indian market they say how can you get the registered their trade mark in India. Now this answer, again your question Registration Versus Common Law right to which common law right is superior. Now the Supreme Court decided this case. What Supreme Court decides is the law of land under the Constitution. Supreme Court laid down the law saying that Whirlpool Corporation is the owner of the trade mark on account of priority of adoption and use irrespective whether they have registration in India or not – 1, registration obtained by the Indian Company give you no right because you copied somebody’s marks. It is not priority of adoption and use and no. 3 – the reputation of the trade mark WHIRLPOOL has spilled over, has traveled to India. Now, how has that reputation traveled and spilled over to India is by way of advertisement in the International magazines, which have circulation in India, by way of sales at the Duty Free Shops, by way of advertisement on the satellite channels. Now, today, what is happening in United States, you see live here. What is happening here you can see all around the world live. So the satellite, the technology is changed, so, today if there is a brand, which is introduced in to a particular market that reputation spills over and if your brand, your name, which you adopt in India, for the first time, you have created a reputation in your brand you take spill over to the other country, so therefore to that extent now, again it depends on the local laws of each country, some countries recognize the concept of trans-border reputation spilling over like India and some of the countries don’t. So, it depends on the local laws of each jurisdiction in each country that what system they follow. Whether they recognize this concept or they do not recognize this concept, but in India, we do recognize, the Indian Court, do recognize the concept of trans-border reputation. Indian Courts have gone a step further. In this Whirlpool case, the Supreme Court had said that the spill over of the reputation, reputation traveling to India, must be shown. You must show by evidence that it has traveled, but in one of the recent cases, in pharmaceutical cases the Supreme Court has even diluted that principle by saying that not necessarily that it must spill over, if you can show that you have a reputation in your home country, i.e. good enough. It needs no travel even, but you are prior, you have adopted it, you must establish you have reputation in your home country, that reputation is good enough to be protected in India. This, we do in India, but if I reverse it, the United States will not. US will not, they don’t recognize the concept of trans-border reputation whereas for American Companies Indian Courts have recognized the concept for the Indian Companies, the United States does not recognize that concept . That is why, I said, it depends on what law in each country?
So, if you have that right, if you have acquired that right, that right to the industry from the perspective of an industry is like any other properties don’t consider that this is an Intellectual Property what is the value, what is the right, what is the benefit of it. The question is it has more value to your business and to your balance sheet and to your assets than your physical properties and if it is a property, if it is a form of property, it is something, which you can sell, like you can sell any other property, you can sell it. You can sell your Intellectual Property. You can mortgage your Intellectual Property. Today, Coca-Cola goes to the banker and says that I want so many Billions of Dollars, I mortgage my Intellectual Property right in the Trade Mark Coca-Cola, No factory, No land, No machinery, No building, it can be mortgaged, in any Bank. The mortgage, the question is some of the banks, which bank may accept the mortgage. The question is, this is an intellectual property, which is capable of being sold. Now being sold by assessment, you say O.K. I sell this is the property, you can sell it. It is a question of buyer and seller depending on what kind of value is attached to a particular brand for particular goods, so you can sell it, you can mortgage it. The question is you can. The first thing is whether in law you have a right to do or not? Whether it is the property, which is capable of being mortgaged or not, that is the first issue, then the question is, who will do it and which bank will do it, whichever bank, supposing it is a brand like Coca-cola / Pepsi or any big band, I think any banker will do it, any banker will finance, any banker, because of royalty why would they take it because today if you take Coca-cola, Coca-cola does not own any bottling plant. They are owned by different people. But today, it is the royalty franchise. It is money which is generated by that brand, the revenue, which is generated into the balance sheet on account of licensing or franchising to the bottling units. The banker would very happily say I am willing to give you so much money against this because this is a mortgage like any equitable mortgage which you do not made. If you do not repay that property, which belongs to the bank meets the loan, which is much worth much more than what he may be financing. So, therefore, it is property, which you can sell, which you can mortgage, which you can finance. You may say that you have a franchise and you can use it in a particular territory so financing is another area, where you can say Intellectual Property for the purpose of generating funds, generating money. You may say this is my brand, I cannot go to every part of the World, I cannot go to every part of the country, so, therefore, I give franchise, I give a license to a local person, he will be looking after manufacturing, marketing into that area or into that zone. But when I am licensing, what would you ensure – quality because it is attached to your name, because, it is your name, it is your reputation, which will be affected if under that brand or under that name, somebody is trying to sell out for inferior quality of the products. Now, on a question of reputation I take back you to the first example because it is a reputation of a person by which you would be known throughout your life as an individual, as a child who is born and you have given a name and every thing with the growth of the person, he is building up the reputation and it is that reputation which lives with a person and by that reputation you will say, when you talk about that person, you say, YES, very good person and when you say a good person, a good reputation, everybody wants to deal with that person again and again and if a person has got a bad reputation nobody will deal with it. Similarly, if you have a product, which has got a reputation, you want to keep on buying that product and recommend to your brands a good product. But if it is a bad product it has a bad reputation, you will not buy it yourself and if somebody is going to buy, you will say, don’t buy that, buy other one. This is the reputation in the quality of the product, so, therefore when you are licensing when you are franchising, you are concentrating on the reputation and the quality. The quality must be maintained. So that is the advantage of having an Intellectual Property, acquiring a right protecting it, so that it facilitates a remedy at later date, tomorrow there may not be dispute even between you and your franchise. Your franchise may say no-no I have my independent right so therefore the protection by statute is more important so that your burden of proof is lessened. In case of a dispute, because you have to take as a businessman, you have to take all precautions to protect your property. You take all kinds of precautions to protect all your property. If you have cash you take all protection by putting it in a locker or putting it in a bank. If you have jewellary you have a box so that you protect your property, then when it comes to Intellectual Property why should you protect it, that is to be protected for and ultimately because that is the wealth you have created into your property, which needs a protection.
So, the next question is that when we talk about protection and now the question is of enforcement. Now on an enforcement – how do I enforce my right then, now here also I am dividing them into 2 compartments – one - Trade Mark & Copyright on one side and Design and Patent on the other side. If somebody has invaded your property or Intellectual property in the Trade Mark or in Copyright, in law we call it as a Civil wrong as well as a Criminal wrong. You can enforce your remedy by a process of Civil wrong by going to the Court and asking for the injunction that he should be restrained from continuing with this kind of an activity of manufacturing or selling the goods bearing a name, which is my property. Not only that name, any name, which resembles thereto, it could be phonetically, visually and structurally same or deceptively similar. The concept of deceptively similar mark identical or deceptively similar mark. So, you can stop him going to the Civil Court and granting an injunction because that power is only with the Civil Court under the Civil jurisprudence that only a Civil Court is competent to pass an injunction order in a prohibitory nature or in mandatory injunction that either you will not do it or you will do it. So, you have a Civil remedy provided under the Trade Marks Legislation and under the Copyright Legislation. If there is a violation of your right viz-a-viz Trade Mark and Copyright, it is a Criminal wrong too. You can take a criminal action against a person, who is invading your right and in that process, the person is through the criminal process of Law can be arrested, can be sentenced to an imprisonment up to 3 years, can be fined, which can extend to 2 Lacs of Rupees, so therefore it is both remedies are available to the person, who wants to enforce his right – Civil & Criminal. Option is also yours, you want to go Civil way – you can simply go by Civil way, you want to go criminal way, you can go by Criminal way, you want to go both way – you can go both way. But when this remedy comes to the Design and Paten law, it is only a Civil wrong not a Criminal Wrong under the Indian Law.
It is something like:
There is a pick pocket or there is a thief, he commits a theft, he is caught, the Court tries him and says that you are guilty and I send you jail for three years. He comes out after three years and again commits a theft. Again the process is same he will be again sent to jail. And if he is an habitual offender then the Court will take notice of that this man is habitual offender he goes behind the bar for one year and come out and he commits the same crime then the punishment is more severe. Even in Intellectual Property Law, the punishment for habitual offender, if it is a repeated offences more, because the Criminal Court can only punish him for the offence, which he committed. When this Law was very weak, now it is 3 years cognizable offence punishable with a huge amount of a damages or the penalty, when it was very week, when the Court used to take a very lenient view of this, the way back in 1960s, at that point of time a fine of Rs. 500, the offender will go to the Court of Law he says, Sir, I have committed this offence here is Rs. 500/- my fine and Rs. 500 advance for the next one. Because he knows that he is earning much more, he is not scared of the punishment. Now the question of punishment for a crime or an enforcement of a right is on a question on proprietor of the mark or the owner who owns the property, how effective you or how aggressive you are to protect your right and enforce your right. If you are sleeping over your right, you did not want to enforce your right. If, you say alright if somebody has taken away something from my house, if somebody has opened something from my garage and he has taken away, NO PROBLEM, I will put a new one. This is your choice, so the question is you same, how come somebody can theft of my right, how come somebody has taken even One Rupee from your right. Theft is a theft and he must be taken to a logical conclusion. He must be punished for the offence, which he has committed. So it is for the persons who owns a property to understand that this is my property and I need to protect it and if you don’t protect it what happens, everybody has committed small – small – small – small thefts, ultimately you are not left with anything and your property is gone, as good as gone, for all others. Everybody is enjoying the fruit of your property. So, therefore, the basic issue here arises is that it is not only the creativity, it is not only something you create, an Intellectual Property, which is relevant to your industry but at the same time you must protect it – for what purpose – for better enforcement.
With that I thank you very much for your patience and hearing me for I think about two hours.
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