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.

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WIPO Technology and Innovation support centers in India

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What is TISC?

In April 2009, the member states of World intellectual property organization (WIPO) directed the organization to commission “Technology and Innovation Support Centers (TISCs)” as Pilot programme to facilitate the national offices for intellectual property in developing countries, especially Least Developed Countries (LDCs), as well as their regional and sub-regional intellectual property organizations to access specialized databases provided by WIPO.

According to WIPO, the TISCs will provide the following services:  

  • Access to online patent and non-patent (scientific and technical) resources and IP-related publications;
  • Assistance in searching and retrieving technology information;
  • Training in database search;
  • On-demand searches (novelty, state-of-the-art and infringement);
  • Monitoring technology and competitors;
  • Basic information on industrial property laws, management and strategy, and technology commercialization and marketing

Since the launch of the programme till 2016, about 519 TISCs have been established throughout the world out of which about 280 TISCs are established in African continent.  It is acknowledged that through access to specialized databases and capacity building provided by TISCs, the innovation index and intellectual property has improved considerably in these nations.

India’s Pact with WIPO on TISC

Followed by the success of TISCs majorly in LDCs, On 13th November 2016, Department of Industrial Policy and Promotion (DIPP), Government of India (GOI) made a pact with WIPO to establish TISCs in India. According to the statement released by DIPP, “TISC will give an impetus to Knowledge sharing, sharing of best practices among the TISC’s, capacity building, generation and commercialization of IPs” which will help India to improve its IPR infrastructure.

IPR infrastructure in India

The Indian government has continuously taken initiatives to enhance the IPR infrastructure. For example, during the 11th Five Year Plan, GOI established an institution named “National Institute of Intellectual Property Management (NIIPM)” which focuses on training the examiners of Patents, Designs, Trademarks and Geographical Indications, IP professionals and IP managers. It also aims to impart basic education to user communities, government functionaries and stake holders involved in creation, commercialization and management of intellectual property rights (IPR). Recently the Cell for IPR Promotion and Management (CIPAM) announced a scheme called “Creative India, Innovative India” which was expected to commence by April, 2017. The scheme at an expense of around INR 30 crores (approximately USD 5 million), aims to create awareness and educate various user communities which are involved in innovation and commercialization of IPR. On the other hand, India has numerous techno-legal IPR firms that works for several decades in the field and offers high quality IPR services.

If institutions like NIIPM and schemes like “Creative India, Innovative India” work to fulfil and deliver their respective agendas, India will acquire all benefits that are claimed to be delivered by TISCs. Hence, the establishment of TISCs will replicate the same benefits that will be achieved through foregoing schemes and also seriously affects the growth of Indian IPR firms that have been diligently working to make remarkable improvements in the field for several decades. Not to forget, Indian IPR firms have been providing IP services, specifically patent services, to firms in US and Europe.

It may be fair to conclude that India has significant knowledge and resources in the field of IPR and has infrastructure to further improve IPR services within the country. Hence, India may utilize the home-grown institutions and firms to strengthen IPR, and introduction of TISCs may only dilute the resources available for the cause.

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VAT on McDonald’s trademark licenses

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The last few decades have witnessed an influx of many international consumer brands in India. These multinational corporations license their intellectual property to regional organizations, which can subsequently become franchisees of the International brand. International brands license their trademarks and patents to regional organizations that pay fees in the form of royalties. The Delhi High Court passed judgement in an interesting case concerning the taxation of such royalties of the following companies: McDonald’s (the Appellant), Bikanerwala, GlaxoSmithKline Asia and Sagar Ratna (the Petitioners).

            The abovementioned companies owned trademarks and licensed their brands in franchise agreements. GSK Asia had issued trademark licenses of their powdered beverage, ‘Horlicks’, to SmithKline Beecham Consumer Healthcare Ltd. for sale in India, Nepal and Bhutan. All licenses were non-exclusive, and the Petitioners received royalties made up from a percentage of the revenue earned from the sale of the trademark-bearing products, namely burgers, health drinks, biscuits, etc.

            The Constitution states laws related to Sales tax and Service tax in the Articles 246, 268A and the Seventh Schedule. The Union List (a list of items given in the Seventh Schedule on which the Parliament has exclusive power to legislate) provides for ‘92C. Taxes on services’, while the ‘54. Taxes on the sale or purchase of goods other than newspapers, subject to the provisions of Entry 92A of List I.’ is included in the State List. Generally, according to the stated excerpts, an IP transaction would be taxed ‘Service Tax’ by the Union if it is taken as a rendering of a service and would be taxed ‘Sales tax or VAT’ by the State if it is taken as a sale of goods.

            There have been several situations wherein organizations tried to bypass either of the taxes by reasoning that the nature of their IP transaction was not taxable by the concerned authority. After several litigations and constitutional amendment, the law related to IP transactions can be summarized as follows:

  1. Composite contracts that include elements of both sale and service cannot be taxed twice. (State of Madras v. Gannon Dunkerley). Sales tax (or VAT) and Service tax are mutually exclusive taxes.
  2. Transfers of the right to use goods (TRUGs) are considered sales. IP is considered as goods.
  3. A mere permission to use IP is not considered to be a sale.

Now, it is to be noted that when an IP transaction is considered to be a sale, the respective State(s) may levy sales tax on the resulting royalties. Hence, it is not a surprise that time and again, several States claimed that IP licenses are considered as TRUGs, due to which the States can levy sales tax on the transaction.

The main question here was to identify the circumstances where the licensing of IP rights amount to a sale of goods, and the circumstances in which they would amount to the rendering of a service. In BSNL v. Union of India (2006), Justice Lakshmanan delivered five criteria that had to be fulfilled for a transaction to qualify as a TRUG:

  1. There must be goods available for delivery;
  2. There must be a consensus ad idem as to the identity of the goods;
  3. The transferee should have a legal right to use the goods – consequently all legal consequences of such use including any permissions or licenses required therefore should be available to the transferee;
  4. For the period during which the transferee has such legal right, it has to be the exclusion to the transferor -this is the necessary concomitant of the plain language of the statute – viz. a “transfer of the right to use” and not merely a licence to use the goods;
  5. Having transferred the right to use the goods during the period for which it is to be transferred, the owner cannot again transfer the same rights to others.

      In this case before the Delhi High Court, the crux of the matter was whether sales tax had to be levied on the royalty payments received by the licensors in the trademark licensing.

            In the assessment year 2005-2006, the Delhi Value Added Tax authorities gave a notice to McDonald’s that royalty payments were to be taxed as they were related to the transfer of rights to use the trade mark "McDonald's". On 17th March 2006, the Value Added Tax Officer issued a letter alleging that McDonald’s had a sale turnover from trade mark and patents in the form of royalty received from its franchisees; and thus, attracted a levy of sales tax under the provisions of the Delhi Sales Tax on Right to Use Goods Act, 2002 (DSTRTUG Act).

Subsequently, McDonald’s filed a reply wherein it resisted the levy of sales tax under the DSTRTUG Act and submitted a copy of the Master License Agreement (MLA) executed between the Appellant and McDonald’s India. However, the Value Added Tax Officer treated the McDonald’s system as goods and sent McDonald’s an order with a demand of Rs. 13,44,684 charged as Sales tax.

Aggrieved, McDonald’s appealed to the Joint Commissioner of Trade and Taxes, who upheld the order given by the Value Added Tax Officer. In response, McDonald’s appealed to the Appellate Tribunal in September 2008. The Tribunal, however, dismissed the appeal. As a final resort, McDonald’s filed an appeal at the Delhi High Court.

In a similar manner, the petitioner Sagar Ratna Restaurants Private Ltd paid Service tax to the Central Government at a rate of 12.36% for the related fiscal year, but received an order passed by the Value Added Tax Officer stating that its received franchisor fee is subject to DVAT levy. Additionally, Bikanerwala Foods Pvt. Ltd and GlaxoSmithKline Asia Pvt. Ltd. have entered into franchise agreements similar to that of McDonald’s and Sagar Ratna Hotels, earn royalty for rendering such services and accordingly pay service tax on the same. They were also served notices regarding the payment of VAT.

McDonald’s argued that the franchise agreement only confers the right to use the McDonald’s systems in a restaurant, and royalty is paid as a percentage of gross sales. Further, according to one of the clauses in the licensing agreement, the licensee is not allowed to use any name, mark or other related intellectual property except in connection with the operation of the restaurant.

McDonald’s applied the five-point criteria of BSNL stated above, and stated that there were no goods which were deliverable at any stage and there was no transfer of right to use any trade mark. Thus, they argued that the levy of sales tax/VAT was without jurisdiction and contrary to the relevant statutory provisions

The franchise agreements signed between the Petitioners and their respective franchisee parties were drafted in a similar manner, wherein the licensees were not given the exclusive right to use the respective trademarks and were only permitted to use the trademarks for the limited purposes provided in the franchise agreements. Thus, the Petitioners gave an argument similar to that of McDonald’s.

When the Delhi High Court examined the McDonald’s Master License Agreement, it found that the agreement was a composite franchise agreement which included trade secrets, know-how, recipes, training, etc. along with the trademark to the franchisee. The High Court determined that a limited right to use the composite system of a business is not a transfer of the right to use goods. Subsequently, the Court held that any such composite contract that non-exclusively provided a bunch of services could not be levied Sales tax.

The Delhi High Court’s judgement in this case cleared the confusion caused by several contradictory judgements passed in prior cases. However, it seems to be too little, too late, considering the introduction of the Goods and Services Tax (GST) from 1st July 2017, which is bound to change the game altogether.

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Japan Patent Office invites Indian IPR Practitioners for training

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The Japan Patent Office (JPO) is known for hosting training programs that are well received and respected. The JPO in co-ordination with Japan Institute for Promoting Invention and Innovation (JIPII) and The Overseas Human Resources and Industry Development Association (HIDA) is organizing training program for Indian IPR practitioners in Japan. One of the training programs focuses on patents, while the other focuses on trademarks.

The training program focusing on patents will be held between August 22 and September 07, 2017. JPO is inviting patent attorneys, IP lawyers, patent practitioner and persons working at Japanese enterprise to apply. The training program is designed to cover topics ranging from IPR enforcement under the TRIPs regime to License negotiation for Standard Essential Patents.

The training program focusing on trademark will be held between December 04 and December 15, 2017. JPO is inviting patent/trademark attorneys and IP lawyers involved in trademark practice, employees engaged in trademark practice in private business, and persons working at Japanese enterprise to apply. Note that you will notice discrepancy in dates when you refer to the detailed training schedule and the date initially mentioned. You may cross check with the concerned authorities before applying.

The application should be sent to the office of the Controller General of Patents, Designs and Trade Marks (CGPDTM) before May 15, 2017. The office of the CGPDTM will initially scrutinize the applications and send their priority list to JPO, who will take a final call on shortlisting of candidates. Most of the expenses, including air tickets are taken care of by the JPO.

The application form can be downloaded here and the details of the training program can be found here.

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IP filing trends derived from the Indian IP 2015-16 annual report

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The office of the Controller General of Patents, Designs & Trade Marks, commonly referred to as IPO, publishes annual reports with data corresponding to patent, design and trademark filings in India. The IPO recently published the annual report of 2015-16, and we have crunched and analyzed the data to provide some interesting insight. 

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Trademark controversy which “The Nation wants to know”

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An interesting debate has risen over the phrase nation wants to know. The phrase was used frequently by one of India’s most popular news anchors Arnab Goswami, while questioning his guests on a daily primetime live debate called Newshour, aired on Times Now channel owned by Bennett, Coleman & Company Limited (“BCCL”). Arnab later resigned to start a news channel called Republic TV, which is slated to launch in the coming days. According to news reports, Arnab has received a notice from his former employer asking him not to use the phrase on his news channel Republic TV alleging that the phrase is their trademark.

Interestingly, Arnab’s new company ARG Outlier Media Private Limited (“ARG”) has applied for trademark registration of the phrase the nation wants to know (application number – 3467425) and nation wants to know (application number – 3467428). On the other hand, BCCL has applied for trademark registration of the phrase nation wants to know and corresponding logo (application numbers – 3434199 and 3434201).   

Any IP practitioner would agree that getting trademark registration over the phrase nation wants to know for news services is an uphill battel. The phrase would likely be rejected on absolute grounds under Section 9(1)(c). As per said section, trademark registration should be refused if the trademark consists exclusively of marks which have become customary in the current language or in the bona fide and established practices of the trade. There is absolutely no doubt that the phrase under consideration is customary in the current language or in the bona fide and established practices of the news industry.

Section 9(1)(c), however, provides an exception, which allows for registration of such phrases. For such phrases/marks to be registered, the phrase should have acquired a distinctive character as a result of its usage before the date of application for registration or the phrase should be a well-known trade mark. Therefore, one would hope that considering the might of BCCL and Arg, both would have framed a sound legal strategy at least to prove that the phrase has acquired a distinctive character as a result of its usage before the date of application for registration. However, the actions taken by both parties thus far only appear to indicate lack for strategy to further their cause.

BCCL had an excellent opportunity to prove that the phrase has acquired distinctive character as a result of its usage, since the phrase was constantly being used by Arnab, as its employee. However, BCCL, in their trademark applications has submitted that they “propose to use” the mark/phrase. In other words, BCCL is not asserting that they have already been using the phrase, but only propose to use the phrase. In view of this submission, it is unlikely that BCCL will be able to benefit from the exception of Section 9(1)(c), and will most likely be rejected trademark registration at least for news related services.

Arg’s strategy appears to be equally lackluster. ARG being a new entity, with its news channel yet to be launched, would in any case find it difficult to benefit from the exception of Section 9(1)(c), since they have not used the phrase to the extent required by Section 9(1)(c). Therefore, attempting trademark registration would be an effort without any favorable outcome. Nevertheless, there is no harm in filing for trademark registration. A more concrete and supplementary strategy would be for Arnab to assert that he has personality rights over the phrase, since “nation wants to know” is widely considered as Arnab’s style of questioning his guests on TV debates. However, Arnab in his open audio response on YouTube purportedly to BCCL says “Every Indian has a right to use that phrase. And this phrase comes from the heart. Every Indian, through his or her questioning spirit, can use the phrase Nation Wants to Know”.

With this response, Arnab, one of the directors of ARG is in effect appears to be submitting that the phrase has no distinctive character, and hence cannot be a trademark, and more importantly, he submits that he does not have any personality rights over the phrase, which is a way may have a more devastating effect in establishing rights over the phrase.

In conclusion, while the tussle over the phrase “nation wants to know” is interesting, this article tries to draw a broader picture of trademark strategy, and the finer details that can change the course of outcome.

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SIPP Facilitator: Facilitating Patents for the greater good at what cost?

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InvnTree had previously published an article discussing the Scheme for Facilitating Start-Ups Intellectual Property Protection in India, which can be found here.

The Indian Government, in an effort to encourage start-ups in India, launched the Scheme for Facilitating Start-Ups Intellectual Property Protection (SIPP) in January 2016. This scheme was initiated in an effort to reach out to start-ups and protect and promote their Intellectual Property Rights (IPR). Start-ups can avail patent, trademark and design services by paying the required statutory fees excluding professional fees. The Government would pay nominal professional fees for the services related to procuring the IPR to the advocates or patent/trademark agents in charge of handling the IPR process.

Start-ups can avail a complete start-to-end array of services under this scheme, including general advice, assistance in drafting complete/provisional applications, filing applications, preparing and filing responses to examination reports, appearing at hearings, contesting opposition and ensuring the final disposal of the IPR application.

The Government invited advocates, patent agents and trademark agents to sign up for the SIPP scheme. Consequently, several members of the IPR practicing community put forward their names and signed up for it. A public notice regarding guidelines for facilitators and start-ups was released in June 2016, and can be viewed here

The guidelines provided directions to the facilitators and the start-ups on filing and processing applications with regards to patents, designs and trademarks. It also included the fees payable by the government for services rendered by facilitators. The total professional fees for filing a patent and disposing it without opposition was INR 20,000 (approx. USD 333), and for disposing it with opposition services was INR 25,000 (approx. USD 416). Further, facilitators were not allowed to charge more from the start-ups apart from statutory filing fees. Considering the amount of time, work and expertise involved in the patenting process, the fees prescribed for patent services seem to appear far from reality.

The June 2016 guidelines did not provide complete clarity on matters such as whether a facilitator is allowed to decline application requests. However, in March 2017, another public notice was released which was related to such queries regarding the SIPP scheme. The government made it clear that registered facilitators should not charge any fee from the start-ups other than statutory filing fees. The notice further mentioned the occurrence of incidents wherein facilitators did not provide facilitation to start-ups by citing various reasons. The notice cautioned facilitators against such practices. Further, it stated that any act of denial of facilitation to a start-up would be considered as an act of misconduct in their professional capacity which may lead to the removal of their name from the list of facilitators. Additionally, there may be action for the removal of their names from the list of registered Indian patent/trademark agents. The notice can be downloaded here

Team InvnTree works with a lot of startups as well and is always keen to help them out with our expertise. However, in the regard of becoming a facilitator, our team at InvnTree made a conscious decision since the very beginning to not be part of the SIPP scheme. Hence, we did not register as a facilitator. We took into account the level of expertise needed in a niche area such as IPR, and concluded that the professional fees paid by the government are not agreeable for the amount of work that goes into the IPR process with respect to patents in particular.

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. 

Best regards – Team InvnTree   

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