MoU between India and Sweden on IPR

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The Union Cabinet has given its approval to the Memorandum of Understanding (MoU) between India and Sweden on cooperation in the field of Intellectual Property Rights (IPR).

The MoU is aimed at establishing a wide ranging and flexible mechanism to exchange the best practices and to work together on training programs and technical exchanges to raise awareness on IPR and to improve protection of IPR in both the countries.

According to the press release by Ministry of Commerce & Industry, Government of India, a Joint Coordination Committee (JCC) will be formed with members from both countries to decide cooperation activities to be taken up under the MoU.

The MoU enables India and Sweden to exchange their best practices, experiences and knowledge on IP awareness among public, businesses and educational institutions, and to organize training programmes, exchange of experts, technical exchanges and outreach activities.

The MoU also aims at dissemination of information and best practices in protection, enforcement and use of IP rights among the industry, universities, R & D organisations and Small and Medium Enterprises (SMEs) through training programmes and events.

The countries will also exchange information and best practices on IP infringement in the digital environment, especially regarding Copyright issues.

Furthermore, both the countries will cooperate in automation and implementation of modern documentation and information systems for IP management. The countries also aim to understand mechanisms for protecting traditional knowledge.

Through the MoU, India has taken yet another initiative to participate as a major player in global innovation, as framed in its objectives of National IPR Policy 2016. This exchange of best practices in IPR between the two countries is expected to result in improved protection and awareness about India's range of innovations.

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Risks of adopting Gods’ names as Trademark

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Goodwill in a trademark is built over the years by making sustained investments into the brand. After having made these investments over the years, a trademark that cannot be enforced to the fullest desirable extent is certainly a setback. One such class of trademarks that has inherent limitations as to its enforceability are names of gods. Names of gods are commonly used as trademarks in a variety of businesses in India. While some of these trademarks may have been registered, others continue to be used as unregistered trademarks. Whether registered or unregistered, enforceability of such trademarks remains a challenge. We have analyzed a case concerning one such trademark, in which judgement was passed recently, to explore the angle of registrability and enforceability.

The Bombay High Court recently passed a judgement in a case between Freudenberg Gala Household Product Pvt. Ltd (hereinafter “Gala”) and GEBI Products (hereinafter “Gebi”). Gala started using a trademark “LAXMI” in respect of its product, brooms, in the years 1995. Gala subsequently applied for and obtained registration of the trademark “LAXMI” as a “label”. Notably, “LAXMI” is the name of a popular Hindu goddess. Gebi, on the other hand adopted the trademark “MAHA LAXMI” also in respect of brooms. “MAHA LAXMI” is another name of the same Hindu goddess “LAXMI”. The primary question before the Court was whether the registered label mark “LAXMI” was infringed by Gebi by the usage of the trademark “MAHA LAXMI” in respect of identical goods, brooms. The Court ruled in favor Gebi.

In this case, succinctly put, in-principle Gale contested that the scope of protection of its registered label trademark extends to the words within the label, and not just the label as a whole. Over and above that, since the word within the label is the name of a god, Gale sought monopoly over usage of name of a god as a trademark, expressed in whichever form, with respect to a certain class of goods.

It is well established that, where a label is registered as a whole, such registration cannot possibly give the proprietor of the trade mark exclusive statutory right over any particular word or name contained therein apart from the mark as a whole. Registrar of Trade Marks vs. Ashok Chandra Rakhit Ltd. The Court applied well established principles while dealing with label/device marks, to compare the registered label mark of Gale as a whole and the mark adopted by Gebi as a whole, to find that Gebi’s mark was not infringing on the label mark of Gale.

With respect to usage of name of gods, the Court prima facie found substance in assertion that names of gods are not exclusive and such words cannot be monopolized by one party. The Court further opined in the same context that claiming and protecting the label mark is different than to claim monopoly over a common word.

In conclusion, adopting names of gods as a trademark may be a risky proposition. Even if one has adopted such a mark, one may be able to register the mark as a label or device, and registration of the mark as a word mark as such may not be feasible. Further since exclusive statutory rights may not be claimed over such words, enforcement remains a challenge.

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Nuances of Copyright infringement by manufacture of products based on Engineering drawings

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A recent judgement of the Delhi High Court in Holland L.P. and another. vs S.P. Industries calls for a debate on copyright infringement, and overlap and exclusivity between copyright and industrial design protection laws in the country.

We start by providing an overview of events that led to the dispute between the parties. Holland L.P. had designed and developed an Automatic Twist Lock (“ATL”) system, and has supplied the same to the Indian Railways over the years, with an Indian partner. Indian Railways had floated a tender in the year 2012 for replacement and repair of a list of parts of the ATL devices supplied by Holland L.P. and its partner. The Indian partner of Holland L.P. and S.P. Industries participated, with the latter emerging as the successful bidder.

In this backdrop, Holland L.P. (“Plaintiff 1”) and its partner (“Plaintiff 2”) had sought permanent injunction restraining S.P. Industries (“Defendant”) from manufacturing, selling, offering for sale, advertising, directly or indirectly ATL and parts thereto, alleging that such acts of the Defendant amounts to infringement of copyright of the Plaintiff. The Court however, ruled in favour of the Defendant.

Now referring to the particulars, engineering drawings (2D drawings) of the ATL prepared by Plaintiff 1 was made available as part of the tender by Indian Railways with permission from Plaintiff 2. The Plaintiffs contended that they are the owners of the copyright over the engineering drawings and they have the exclusive right over three-dimensional representation of the engineering drawings. In other words, the Plaintiffs contended that they have the right to prevent others from manufacturing, selling, offering for sale or advertising a product based on the engineering drawings. The Plaintiffs further contended that engineering drawings are not “Design” as per The Designs Act, 2000, since such drawings are “functional” and do not “appeal to the eye alone”. The instant contention is particularly relevant because, in case the subject matter over which the Plaintiffs are claiming copyright protection, is protectable under The Designs Act, then copyright would cease after the Plaintiffs reproduce the ATL 50 times by an industrial process, as per Section 15 of the Indian Copyright Act. The Plaintiffs had in fact reproduced the ATL systems 50 times by an industrial process. 

On the other hand, the Defendant contended that the subject matter over which the Plaintiffs are claiming copyright, is protectable under The Designs Act, and since the Plaintiffs have reproduced ATL systems at least 50 times, the copyright of the Plaintiffs has ceased.

While there were various other contentions, we are particularly interested in understanding whether engineering drawings is subject matter of copyright protection alone, or are they protectable as industrial design under The Designs Act.

The Court is of the opinion that engineering drawings made for the purposes of production of ATL systems is subject matter, which is protectable as industrial design under The Designs Act. The Court is of the opinion that, any design (such as engineering/machine drawings) which is used for the purpose of industrial production of an article, is protectable as industrial design. The Court draws the instant opinion by conjoint reading of Section 2(d) of Designs Act, 2000, Section 14(c) and 15(2) of the Copyright Act, 1957.

We agree with the Court’s interpretation only in part for reasons that follows. One would agree that a set of engineering drawings would include drawings that define the way a product looks. In other words, such subset of drawings defines how the finished article/product appeal to and are judged solely by the eye. Hence, such drawings may be subject matter of industrial design protection. However, engineering drawings may also include a subset of drawings that define how certain parts, which are housed inside the product, are configured. Hence such drawings correspond to parts that are purely functional and are incapable of appealing to and being judged solely by the eye. Hence, it may be inappropriate to come to a conclusion, as the Court has, that any design which is used for the purpose of industrial production of an article, is protectable as industrial design. Our sense is that, design of product will include subject matter, such as engineering drawings of “housed/functional” parts (purely functional and not expressly contributing to aesthetics), over which only copyright protection applies, and will also include subject matter, which substantially defines how the product is perceived by the eye, which is protectable as industrial design.

Having made the above observation, it is now worthwhile to explore whether the owner of copyright over technical drawings corresponding to such functional parts (not the product as a whole, which is subject matter of industrial design protection) stop others from manufacturing such functional parts. Section 52(1) of the Copyright Act precisely deals with this matter.   

Section 52(1): The following acts shall not constitute an infringement of copyright, namely:-

(w) the making of a three-dimensional object from a two-dimensional artistic work, such as a technical drawing, for the purposes of industrial application of any purely functional part of a useful device.

The above section makes it clear that, even though one may hold copyright over engineering drawings over purely functional parts, they will not be able to stop third party from producing such parts. In other words, provisions of the Copyright Act cannot be used to stop third party from producing (including other acts of commerce) such functional parts, irrespective of whether they are visible or hidden from being gauged by the eye.

In conclusion, drawings that define the way an article/product appeals to and is judged solely by the eye, is protectable as industrial design, and copyright in the same ceases to exist once the article/product is reproduced 50 time by an industrial process by the owner. Drawings of purely functional parts of an article/product are not protectable as industrial design, and only copyright protection exists. However, such copyright is not infringed by third party who produces such functional parts.

I hope you found our article informative. The judgment can be downloaded below. 

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India’s rise in the Global innovation index ranking

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The Global Innovation Index (GII) released the Global Innovation Index 2017 in June 15, 2017, in which India stood at the 66th rank. The GII 2017 lists 127 countries according to various aspects that are responsible for innovation. It is co-published by Cornell University (New York), INSEAD graduate business school (France), and the World Intellectual Property Organization (WIPO, an agency of the United Nations).

The GII focuses on innovation and uses a broad variety of information and sources for capturing data to develop the Index. The GII collates information related to seven sub-indexes, which comprises five input indexes and two output indexes. The five input indexes are: (1) Institutions, (2) Human capital and research, (3) Infrastructure, (4) Market sophistication, and (5) Business sophistication. The two output indexes that capture actual evidence of innovation outputs are (6) Knowledge and technology outputs and (7) Creative outputs.

India’s Department of Industrial policy and Promotion (DIPP) set up a ‘Task Force on Innovation’ which was tasked with assessing innovation creation and suggesting measures to enhance the innovation ecosystem in India in order to improve India’s GII ranking. The Task Force comprises government officials and experts from private organisations and academia. This team published an in-depth report after studying the Global Innovation Index 2017. The report compares rankings from 2015 and 2016, giving a clear-cut picture of how we have progressed in this time duration, and provides recommendations of various schemes and plans that can be implemented.

In particular, the output index ‘knowledge and technology outputs’ includes several indicators belonging to Intellectual Property. The ‘knowledge and technology outputs’ index comprises three sub-pillars, namely Knowledge creation, Knowledge impact and Knowledge diffusion, resulting in fourteen individual indicators altogether. The following tables showcase our rankings based on data collected in 2015 and 2016 (the GII 2017 report ranks nations based on 2016 data).

We witnessed an improvement in the ranking of the knowledge and technology outputs index. 2016 saw an overall improvement in all three segments, and a particularly commendable improvement seen in the knowledge impact indicators, wherein our rankings rose by 36 ranks.

GII-1Knowledge Creation

The knowledge creation sector did not see much of a rise in rankings. Further, it is worth noting that while the ranking for ‘Scientific and technical articles/ bn PPP$ GDP’ has remained the same, the score for the same has decreased from 7.5 to 7. The report mentions Uchchatar Avishkar Yojana (UAY) and Impacting Research, Innovation, and Technology (IMPRINT), both of which are Government programs that may aide intellectual property creation.  

Gii-2

            Further suggestions stress on the importance of improving the availability and quality of education. There needs to be a focus on higher education, namely graduate programs and higher programs, while stressing upon research in fundamental as well as applied knowledge.

            Another point to note here is that these indicators only capture data created by formal systems. However, there are numerous innovations occurring informally, at various levels. There is a requirement for a bridge linking formal knowledge as well as informal. Including this informal, unaccounted data would greatly benefit the Government as well as the people, along with increasing our rankings in this area.

Knowledge impact

The knowledge impact sector witnessed a considerable rise in rankings from the 84th rank in 2015 to the 48th rank in 2016. The major cause for this is the increase in rankings of ‘Growth rate of GDP per person engaged (constant 1990 PPP$)’ from the 38th rank to the 6th rank in the world.

Gii-3In case of knowledge impact, there is a need to create awareness on various opportunities available through the State and Central government. Proper knowledge must be imparted to the public with respect to any available benefits and schemes so that interested people or organizations may put them to good use.  

The report also mentions that programs and initiatives like Make in India, Start Up India, Smart Cities across the country, Industrial Corridor etc. would give a positive impact to the GDP growth in India.

Knowledge diffusion

The improvement in the knowledge diffusion sector was driven mainly by the ‘FDI net outflows, % GDP’, which saw a rise in ranking from the 92nd rank to the 60th rank. FDI net outflows is defined as the “net outflows of investment to acquire a lasting management interest (10% or more of voting stock) in an enterprise operating in an economy other than that of the investor.” It is also important to note we rank 1st in the world for ICT (Information and Communication Technologies) services exports, which was retained from 2015. 

GII-4

There is definitely a need for increasing a general awareness of IP among the public. Such awareness is especially required among Micro, Small & Medium Enterprises (MSMEs), since they are creating innovation but aren’t protecting it or utilising existing IP laws to gain the best benefits possible. IP protection in India must be improved.

Another indicator that concerns IP can be found in the ‘Creative outputs’ index, in which India’s rank improved by 1 from a ranking of 95th in 2015 to a ranking of 94th in 2016.

In particular, the ‘intangible assets’ sector concerns trademark applications and industrial designs, as shown below.

GII-5

            An increase in awareness regarding the identification, recognition and registration of trademarks and industrial designs among public, start-ups and MSMEs must be implemented. Further, Intellectual Property Facilitation Centres (IPFCs) should be strengthened and further replicated in all the districts; IP Cells need to be established in all Universities in India. This can result in higher IP filings that result in an improvement of our ranking in these sectors.

GII-6

            Overall, India witnessed a commendable rise in the Global Innovation Index Rankings, jumping from the 81st rank in 2015 to the 66th rank in 2016. The GII-2017 report states, “India is a good example of how policy is improving the innovation environment”. Schemes such as Start-up India, IMPRINT, UAY, Make in India and Industrial corridor, among many others, provide an encouraging view on improving innovation and industry. We hope that with the proper planning and implementation of such schemes, India may finally live up to its potential for Intellectual Property.

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Trademark protection of architectural design

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A discussion on trademark protection of architectural design will typically begin with the Empire state building. It is because the building owned by a private firm secured its trademark early in 1931 and has enjoyed various economic benefits through the trademark protection for almost 80 years. Followed by the building, few other famous constructions like Eiffel Tower (at night when the lights are aglow) in Paris and Opera house in Sydney have also secured the trademark protection for their architectural design. However, India with numerous architectural marvels that are owned by an individuals or companies have not gained any trademark protection for architectural design until recently.

On June 19th, the Indian Hotels Company Ltd (IHCL) that owns The Taj Mahal Palace was granted a trademark for the hotel’s unique architectural design such as the red-tiled Florentine Gothic dome and the grand exterior. The Taj Mahal Palace is the first building of its kind in India to secure a trademark for its architectural design. India’s iconic luxury hotel, The Taj Mahal Palace that was built in 1903, has hosted numerous famous personalities and dignitaries from different parts of the world and is highly recognizable throughout India. Acquiring trademark registration was not cumbersome as the hotel already met the various prerequisites. In the backdrop of this registration, we discuss various aspects of Trademark protection of an architectural design. 

How can a building secure Trademark protection?

  • The first and foremost rule to apply for a trademark protection for an architectural design is that the building should be either owned by an individual or a company.  
  • The building should be distinctive which means that the building should be easily recognizable by many people.   
  • The building should represent a brand that associates a product or service to a source.

Once trademark protection is secured, the building or architecture can enjoy many economic benefits and prevent others from exploiting the architectural design and take advantage of it.

What can be called a trademark violation of an architectural design?

There are few aspects to judge a trademark violation:

  • The use of the trademarked building should be non-editorial. A building’s image published on a newspaper wouldn’t violate trademark. Whereas, an image of a building used to advertise another product could violate the trademark.
  • The use of the trademarked building to endorse identical or deceptively similar goods or services by third party may be considered infringement. Mc Donald’s in its advertisement for promoting burgers, cannot use an image of a KFC restaurant in the advertisement as it may lead to confusion among consumers.

Economic benefits of trademark protection: Empire state building vs NYC beer –  A case study

A building with a unique and a widely recognizable architectural design can apply for a trademark to prevent others from exploiting the economic benefit of the architectural design. For example, in the year 2016, ESRT Empire State Building LLC who owns the trademark of Empire state building since 1931, filed an opposition for the grant of trademark that was filed by NYC Beer for its alcoholic beverages.

 

NYC beer

The opposition application filed by ESRT Empire State Building LLC was based on the grounds of trademark dilution, likelihood of confusion and false suggestion of a connection with Empire state building. According to US law, the trademark dilution is proved and accepted if the trademark is recognized and famous. As a result, ESRT Empire State Building LLC was successful in winning the opposition as the building attracts millions of tourists and visitors every year and is easily recognizable by public. Also, the building management stated that, a gift shop in the building also sells few alcoholic and non-alcoholic beverages as a souvenir for the visitors. So, the NYC beer may be confused by people with the ones that is sold by the gift shop. The trademark protection, helped the Empire state building to hold its recognition and prevent any misuse of it by any other companies.

Scope of trademark protection of architectural design of a building

Sydney’s Opera House, the Empire State Building and The Taj Mahal Palace hotel could easily secure a trademark protection, as they fulfil all the prerequisites and are owned by private entities.

For some, it might be surprising that how Eiffel tower being a public property, managed to secure a trademark. Surprisingly, the Eiffel tower does not hold a trademark for its architectural design but for the lighting design. The Société d’Exploitation de la Tour Eiffel, the organization managing the structure defends the trademark protection saying that the lighting is an artistic work which is separate from the structure itself. Thus, an architectural design need not necessarily be a structural, instead it can be any other possible architectural design.

For example, Apple, the world’s famous and recognized electronic gadget manufacturer secured a trademark for its “architectural design of Apple stores” from USPTO on January 24, 2013. It is to be noted that every Apple store cannot be structurally same as they are in various places under various space constraints. However, the trademark protection is not for the structure but for the store’s layouts, with their open spaces and symmetrically arranged displays. The trademark protection of “architectural design of Apple stores” helps Apple to legally act against duplication of the “look and feel” of its stores by any of its competitors.

The Trademark protection of an architectural design helps many private firms protect the various aspects of their buildings and structures. It is good to see that Indian firms are also understanding the benefits of trademark protection and trying to get benefit out of their architectural designs.

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The end of Roche vs. Cipla infringement lawsuit

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The tussle between Roche and Cipla that started in the year 2008 has come to an end with a compromise announced on 30th May 2017 between the parties.

Roche has an Indian patent over a drug, “Erlotinib hydrochloride”, for treating lung cancer. In the year 2006, Roche launched the drug in India under the name “Tarceva”. It was reported in January 2008 that Cipla is planning to launch a generic version of “Erlotinib” under the name “Erlocip”. Roche followed by initiating infringement proceedings against Cipla in January 2008.

Roche’s plea for interim relief by way of injunction was rejected by single judge with an opinion that injunction against Cipla’s manufacture was against public interest. Notably, Tarceva costed around INR 140,000 (~USD 2300) for a month’s dosage, whereas Elrocip costed only INR 48,000 (~USD 800). Subsequent appeal by Roche was mostly unsuccessful.

The turnaround in the case happened in 2015, when the case was moved to the Divisional Bench of the Delhi High Court where the judgement was in favour of Roche. The Divisional Bench held that Cipla was infringing Roche’s patent.

Followed by the judgement, Cipla filed a Special Leave Petition (SLP) requesting for appointing a technical expert, which was accepted by the Apex Court in 2016 after which the matter was adjourned. After almost decade long legal proceedings, on 30th May 2017 both the pharmaceutical companies finally came to an agreement and reached a settlement. In June 2017, Cipla moved the apex court seeking to withdraw the Special Leave Petition (SLP) filed against the DHC divisional bench’s decision given in 2015.

The case which is considered to be significant in the Indian pharmaceutical industry has come to an end after shedding light on various aspects of laws pertaining to patent protection of pharmaceutical products.

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Far reaching repercussions of connecting zero GST provision with Trademark Registration

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The Goods and Service Tax (GST), which is hailed as one of India’s biggest tax reforms came into effect on July 01, 2017. The implementation of GST has impacted almost every sector that is part of the Indian economy, including intellectual properties. The tax rates on some items are linked to their trademark status.

Items for which GST rate is linked to trademark status

The GST rate schedule provides a list of items on which tax under GST will not be applicable. However, the schedule comes with a caveat, wherein some of the items (mostly food items) in this list will attract 5% GST if such items are put in unit container and bears a registered brand name. The items that will attract 5% GST in view of said caveat are listed below.

Under chapter 4 (Dairy produce; bird’s eggs; natural honey; edible products of animal origin, not elsewhere specified):

  • Natural honey, chena or paneer 

Under chapter 10 (Cereals):

  • All goods, wheat and meslin, rye, barley, oats, Maize (corn), rice, grain sorghum, buckwheat, millet and canary seed; other cereals such as Jawar, Bajra and Ragi 

Under chapter 11 (Products of milling industry; malt; starches; inulin; wheat gluten):

  • Cereal groats, meal and pellets; aata, maida, besan, flour of wheat or meslin flour, cereal flours other than of wheat or meslin i.e. maize (corn) flour, rye flour etc.

Under chapter 22 (Beverages, spirit and vinegar):

  • Tender coconut water

Under chapter 31 (Fertilisers):

  • Tender coconut water

There were confusions generally as to what would be considered as “registered brand name”.  On 5th of July, the Ministry of Finance issued a statement (presented below) addressing the confusion.

“In this context, the notification… clearly defines ‘registered brand name’ as brand name or trade name, which is registered under the Trade Marks Act, 1999. In this regard, Section 2 (w) read with section 2 (t) of the Trade Marks Act, 1999 provide that a registered trade mark means a trade mark which is actually on the Register of Trade Marks and remaining in force.” “Thus, unless the brand name or trade name is actually on the Register of Trade Marks and is in force under the Trade Marks Act, 1999, CGST rate of 5% will not be applicable on the supply of such goods”

As can be interpreted from the above statement, any listed product that is sold under a trademark, which is registered and remains in force under the Trade Marks Act, will be levied CGST at 5%. For example, there will be no CGST on natural honey sold under a trademark that is not registered. However, natural honey sold under a registered trademark will attract 5% CGST.

Consequence

The items to which this provision applies are basic food items, towards which consumers are highly price sensitive. Hence, the choice for companies, large, medium and small, is to either maintain a registered trademark and have the consumers incur 5% addition cost, or sell under unregistered trademarks. In our view, considering the price sensitive nature of the goods, and consumers in general, the choice for the companies would be obvious. Companies are likely to refrain from applying for trademark registration covering such items, and if they have already registered, then they may apply for cancellation of registration. It has come to our notice that some of the largest players in this sector have applied for cancellation of registration.   

Going forward, we anticipate that trademark applications covering such item will be few and far in between. Also, there will be requests for amendments or cancellation of registered trademarks covering such items.

In the medium to long term, we anticipate increased instances of smaller players introducing such items into the market, bearing trademarks (of course unregistered) that are identical or deceptively similar to large reputed companies. Such activities will dilute the goodwill, and may also negatively impact the reputation of established companies. Such established companies will find it difficult and expensive to stop such players from riding on their goodwill, since enforcing an unregistered trademark is far more complicated compared to enforcing a registered trademark. Although companies may appreciate the risk involved, they would be willing to take this risk considering the pricing pressure discussed earlier. Therefore, in the medium term, we see an increase in trademark litigation in this space.

While we have elaborated on the tentative risks faced by companies, in our view, ordinary consumers are the most exposed. As discussed earlier, there will be relatively more players (as compared to the conditions currently) in the market, trying to ride on the goodwill of reputed companies, and one cannot really expect products of superior quality from such players. Now considering that items of this nature are bought by anyone and everyone, literate and illiterate, there is a high possibility of consumers being deceived into buying such items thinking that it originates from a reputed source. Such confusion is highly undesirable especially in connection with food items, which are brought on a regular basis, and consumed largely on a daily basis.

Conclusion

The Government appears to have introduced the provision of nil GST on some items that are sold under unregistered trademarks to incentivise small traders. However, established companies are positioned to nullify the incentive, and most likely will, by either refraining from applying for trademark registration or cancelling registration. Additionally, the Government’s move may negatively impact the culture of intellectual property protection, which the Government is rigorously trying to foster.

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Guidelines of 2017 for Examining Computer Related Inventions in India

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Patentability of software inventions, which are generally referred to as Computer Related Inventions (CRI), is a topic of constant debate, not just in India, but around the world. India has been trying to introduce objectivity to this topic, which is subjective by nature, by way of amendment to the Act, and by introducing guidelines for examining CRI over the years. The latest among these efforts, is the introduction of guidelines by the office of the Controller General of Patents, Designs and Trade marks, India (generally referred to as Intellectual Property Office – IPO). The guidelines came into effect from June 30, 2017, and replaces previous guidelines for examining CRI. The guidelines can be downloaded here. 

The merits of such guidelines being binding on the patent applicants are questionable, since they neither supersede the Act nor caselaw. However, one can argue that these guidelines may be binding on the patent examiners (acting on behalf of the Controller). Nevertheless, these guidelines will have significant practical implications. The examiners are expected to follow these guidelines while examining CRI. Therefore, their rational while issuing examination reports, granting or rejecting patents to CRI will likely be in line with these guidelines. Further, these guidelines, if nothing, are at least an indirect reflection of the governments stand on patentability of CRI. Hence, there are several compelling reasons for discussing these guidelines in greater detail.

At the outset, it is worthwhile to point out that the guidelines (“new guidelines”) are favourable towards grant of patents for CRI, as compared to the outgoing guidelines (“earlier guidelines”). The notable difference between the two guidelines is the ouster of a “three stage” test, reproduced below, prescribed in the earlier guidelines to determine patentability of CRI.

(1) Properly construe the claim and identify the actual contribution;

(2) If the contribution lies only in mathematical method, business method or algorithm, deny the claim;

(3) If the contribution lies in the field of computer programme, check whether it is claimed in conjunction with a novel hardware and proceed to other steps to determine patentability with respect to the invention. The computer programme in itself is never patentable. If the contribution lies solely in the computer programme, deny the claim. If the contribution lies in both the computer programme as well as hardware, proceed to other steps of patentability. (emphasis added)  

As per the test, a novel hardware had to be present, irrespective of how inventive the software is, for a patent to be granted. In other words, if the inventiveness lies only in software, then the same is not patentable. Such a stance goes against the legislative intent, which in fact clarified its position by introducing an amendment in 2002. The amendment excluded “computer programme per se”, instead of just “computer programme”, from being considered as patent eligible subject matter. The legislative intent to attach suffix per se to computer programme is evident in the view, presented below, expressed by the Joint Parliamentary Committee (JPC) while introducing the amendment.

In the new proposed clause (k) the words ''per se" have been inserted. This change has been proposed because sometimes the computer programme may include certain other things, ancillary thereto or developed thereon. The intention here is not to reject them for grant of patent if they are inventions. However, the computer programmes as such are not intended to be granted patent. This amendment has been proposed to clarify the purpose   

The JPC states “the computer programme may include certain other things, which may qualify them as inventions, and hence be awarded patents. Computer program cannot certainly “include” hardware. Therefore, the three stage test prescribed previously went against the legislative intent while dealing with CRI.

On the other hand, the debate is, what can a computer program “include” that is “ancillary thereto or developed thereon”, which make it an invention. In our view, computer program can include “technical manoeuvres”, again expressed as computer program, which nudge CRI from being categorized as “computer programme per se”.

The new guidelines do not deal with what “other things” the computer program can include that is “ancillary thereto or developed thereon”, which makes it an invention. Hence, the clarity one may desire in the guidelines while examining CRI is still largely absent. However, on a positive note, the guidelines offer stuffiest scope to the examiners to exercise discretion while examining CRI, and to the applicants to argue their case based on the Act, legislative intent and caselaw, without knocking the doors of the Intellectual Property Appellate Board (IPAB).

In conclusion, we welcome the new guidelines to the extent that the three stage test has been ousted, and offers scope for software inventions to be critically examined, without depriving them of patents for want of novel hardware.

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Case of copyright infringement by former employees

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There have been Intellectual property disputes between the recently launched English news channel Republic TV, and Bennett, Coleman & Co Ltd (BCCL), the owner of Times Now TV channel. Their bone of contention began with disputes over trademarks. Previously, the two organizations were challenging each other over the usage of the phrase ‘the nation wants to know’ and ‘nation wants to know’. 

In a recent development, on 16th May 2017, Bennett, Coleman & Co Ltd (BCCL) lodged a complaint against Arnab Goswami, the founder of the Republic TV, and journalist Prema Sridevi for infringing its copyright. BCCL alleged offenses of theft, criminal breach of trust, misappropriation of property and infringement of IPR by using the same on Republic TV in several instances on May 6 and May 8, 2017.

On May 6, Republic TV broadcast information related to Lalu Prasad Yadav. This broadcast included audio tapes of telephone conversations between Lalu Prasad Yadav (former Bihar Chief Minister) and Shahabuddin (a criminal turned politician). May 8 saw a broadcast on Republic TV of information related to the late Sunanda Pushkar (wife of politician Shashi Tharoor), including a recording of an interview between Sridevi (in her capacity as an employee of Times Now) and the now deceased Sunanda Pushkar.

BCCL alleged that these audio tapes and research were accessed by Goswami and Sridevi while they were employed by Times Now. It is to be noted that Goswami was the president and the editor-in-chief of news channels Times Now and ET Now until November 01, 2016.

The second hearing of this case took place in the Delhi High Court on Friday, the 26th of May. According to BCCL, the procurement and the use of information belonging to BCCL without their knowledge and consent amounted to a breach of terms of the employment contract of Goswami.

In their defense, Republiv TV submitted that they did not violate the clauses of the employment agreement and had no intention of doing so. They also denied all allegations of intellectual property infringement. Further, they submitted that these allegations were levelled against them by Times Now due to a fall in their ratings and a loss of viewership due to the spectacular launch of Republic TV.

The Delhi high court restrained Times Group and Republic TV from quoting or broadcasting the details of the court proceedings against each other in the ongoing case of theft and copyright infringement. However, Justice Manmohan clarified that the restriction is not applicable against third parties. He also added that the two channels could continue to broadcast and report on any judicial order or judgment in the case. The next hearing of this case is scheduled on 31 August.

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Facebook’s systematic plan for Peer-To-Peer mobile payments market in India

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FACEBOOK has filed a patent application in India, which attempts to protect a technology that enables making and receiving payments using a messaging applications. The patent application envisages peer-to-peer payment between users of a messaging application, such as WHATSAPP. Selected figures from the patent application indicates the intended use of the technology.

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This Indian patent application is based on a US patent application, which was filed in December, 2014, after FACEBOOK acquired WHATSAPP. Interestingly, in April of this year, WHATSAPP announced that it would be introducing digital payments in India.

One could argue that WHATSAPP is positioned to corner a significant share in the digital payment market in India. For starters, WHATSAPP has a huge consumer base in India and is popular even among those who are not so digitally savvy. Adding to that is the convenience factor in making payments using a chat application. To top it all, the patent application, which might eventually be granted a patent, considering that there are several patents related to payments granted in India. As an example, EBAY was granted a patent (patent number 242805) covering certain technology that facilitates micropayments between parties. A patent grant to FACEBOOK will enable WHATSAPP to monopolize key aspects of the technology that enables peer-to-peer payments using messaging application.

The patent application and WHATSAPP’s digital payment initiative may be the first big bet by FACEBOOK to directly generate revenues from WHATSAPP since its acquisition.

We hope this article was a useful read. 

Please feel free check our services page to find out if we can cater to your requirements. You can also contact us to explore the option of working together. 

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