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STUDY MATERIAL
PROFESSIONAL PROGRAMME
INTEL L
IN TELL ECTUAL PROPERTY
TEL
RIGHTSRIGHTS - LAW AND PRACTICE
MODULE 3
ELECTIVE PAPER 9
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edu website www
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edu
© THE INSTITUTE OF COMPANY SECRETARIES OF INDIA
TIMING OF HEADQUARTERS
Monday to Friday
Office Timings – 9
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M
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00 P
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Public Dealing Timings
Without financial transactions – 9
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M
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00 P
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With financial transactions – 9
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00 P
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Phones
4150444,45341000
Fax
011-24626727
Website
www
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edu
info@icsi
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Moreover, changes in the global
economic environment have influenced the development of business models where intellectual
property is a central element establishing value and potential growth
...
Intellectual property has therefore grown into one of the world’s biggest and fastest-growing fields
of law thereby necessitating the demand for IP professionals well versed in this area to deal with
(IPRs) across the national and international borders
...
The course contents of this study material have
been so designed as to develop specialised skills in the corpus and complexities of the different
aspects of the subject besides meeting the requirements of a future career in this area
...
Only those IPR legislations have been included which
are of direct relevance to the profession of Company Secretaries
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While writing the study material, relevant provisions of the various Acts and Rules made
thereunder have been kept in mind
...
Students are advised to keep
themselves abreast of latest developments by regularly resorting to reading of at least one of the
leading English Newspapers and additional source materials concerning corporate world which are
published from time to time
...
Although care has been taken in publishing this study material yet the possibility of errors,
omissions and/or discrepancies cannot be ruled out
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In the event of any doubt, students may write to the Directorate of
Academics and Prespective Planning in the Institute for clarification at iprl&p@icsi
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dixit@icsi
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Should there be any discrepancy, error or omission in the study material, the Institute shall be
obliged if the same is brought to its notice for issue of corrigendum in the Student Company Secretary
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Detailed Contents:
1
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Patents
•
Concept of Patent
•
Product / Process Patents & Terminology
•
Duration of Patents- Law and Policy Consideration Elements of Patentability,- Novelty and Non
Obviousness (Inventive Steps and Industrial Application, Non- Patentable Subject Matter
•
Procedure for Filing of Patent Application and types of Applications
•
Procedure for Opposition,
•
Revocation of Patents
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Ownership and Maintenance of Patents
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Assignment and licensing of Patents
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Working of Patents- Compulsory Licensing
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Patent Agent- Qualification and Registration Procedure
3
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Preparation of Patent Documents
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Lab Notebooks/Log Books/Record Books
•
Methods of Invention Disclosures
•
Patent Application and its Contents
•
Writing of the Patent Document
5
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Patent Infringement
•
Literal Infringement
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Doctrine of Equivalence and Doctrine of Colorable Variation
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Contributory Infringement
•
Defenses to Infringement including Experimental Use, Inequitable Conduct, Patent Misuse
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Legal Aspects (Act, Rules, Procedures)
7
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Trademarks
•
The rationale of protection of trademark as (a) an aspect of commercial and (b) of consumer rights
•
Definition and concept of Trademarks
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Different kinds of marks (brand names, logos, signatures, symbols, well known marks, certification
marks and service marks)
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Non Registrable Trademarks
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Procedure for Registration of Trademarks
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Opposition Procedure
•
Assignment/Transmission / Licensing of Trademarks
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Infringement of Trademarks
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Passing off Action
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Offences and Penalties
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International Conventions- Madrid Protocol
•
Domain Names
•
WIPO Internet Domain Name Process
9
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Industrial Designs
•
What is a Registrable Design
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What is not a Design
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Novelty & Originality
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Procedure for Registration of Designs
•
Copyright under Design
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Assignment, Transmission, Licenses
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Procedure for Cancellation of Design
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Infringement
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Remedies
11
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Protection of Trade Secrets
13
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4 : INSURANCE LAW AND PRACTICE
List of Recommended Books and References:
1
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B L Wadehra
:
Law Relating to Patents, Trademarks, Copyright,
Designs and Geographical Indications
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G
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G Krishnamurthy
:
The Law of Trademarks,
Design
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Satyawrat Ponkse
:
The Management of Intellectual Property
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S K Roy Chaudhary & H K Saharay
:
The Law of Trademarks,
Copyright, Patents and
Design
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Office of the Controller General of
Patents, Designs & Trade (CGPDTM)
:
Manual of Geographical Indications Practice and
Procedure
7
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Office of the Controller General of
Patents, Designs & Trade (CGPDTM)
:
Manual of Designs Practice and Procedure
9
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Office of the Controller General of
Patents, Designs & Trade (CGPDTM)
:
Trade Marks Agents
11
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WIPO
:
Intellectual Property (IP) Audit
13
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WIPO
:
The Value of Intellectual Property, Intangible Assets
and Goodwill
Copyright, Patents and
15
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OECD Report on Patents and Economic Performance
17
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psa
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za)
18
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progressmedia
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Patentability of Software in India - (Lex Orbis)
20
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unesco
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4: INTELLECTUAL PROPERTY RIGHTS − LAW AND PRACTICE (100 Marks)
Lesson No
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Introduction
2
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Patent Databases & Patent Information System
4
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Process for Examination of Patent Application
6
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Recent Developments in Patent System
8
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Copyright
10
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Geographical Indications
12
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Key Business Concerns in Commercializing Intellectual Property Rights
14
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Time for Putting Application in Order for Grant
Opposition to the Patent
Opposition Proceedings
Constitution of Opposition Board and its Proceeding
Controller to Treat Application as Application Of Opponent
Grant of Patents
Grant of Patents Subject to Conditions
Term of Patent
Patents of Addition
Restoration of Lapsed Patents
Procedure for Disposal of Applications for Restoration of Lapsed Patents
Rights of Patentees of Lapsed Patents which have been Restored
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Notice of Opposition under Section 87(2)
Procedure for Application under Section 88(4)
Application for Termination of Compulsory Licence under Section 94
International Applications
Appropriate Office in Relation to International Applications
International Applications filed with Appropriate Office as Receiving Office
International Applications Designating or Designating and Electing India
Filing of Priority Document
Patent Agents
Qualifications for Registration as Patent Agents
Qualifying Examinations for Patent Agents
Registration of Patent Agents
Details to be Included in an Application for the Registration of Patent Agents
Disqualification for Registration as a Patent Agent
Register of Patent Agents
Alteration of Names etc
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...
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Obtaining Invention Disclosures from Inventors
2
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Understanding the Invention
Typical Parts of the Patent Application
1
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Detailed Description or Specification
3
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Background
5
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Summary
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…
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…
…
…
…
…
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83
84
84
84
85
85
85
85
87
88
88
88
89
89
91
91
92
92
LESSON ROUND UP
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93
…
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95
96
Lesson 4
PREPARATION OF PATENT DOCUMENTS
Lesson 5
PATENT INFRINGEMENT
Learning Objectives
Introduction
(xiv)
Page
(a) Direct Infringement
(b) Indirect Infringement and contributory infringement
Exclusions from infringement
(a) Experimental and Research
(b) Parallel Importation under certain conditions
Jurisdiction
Period of Limitation
Burden of Proof
Doctrine of Equivalents and Doctrine of Colorable Variation
Declaration as to Non-Infringement
Acts Which do not Amount to Infringement
Reliefs in Suits for Infringement
Injunction
Damages and Accounts for Profits
Anton Pillar Order
Groundless Threats of Infringement Proceedings
Right of Exclusive Licensee to Take Proceedings Against Infringement
Defenses etc
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110
SELF TEST QUESTIONS
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139
139
140
140
141
141
141
141
142
142
145
SELF TEST QUESTIONS
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197
SELF TEST QUESTIONS
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199
201
203
SELF TEST QUESTIONS
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Clarity about the Purpose
2
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Preparing an IP Audit Plan
Conducting an IP Audit
1
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Auditing Different Contracts/Agreements
3
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In
the 1990s, many countries unilaterally strengthened
•
Copyrights
•
Trademarks
their laws and regulations in this area, and many
others were poised to do likewise
...
The new global
IPR system comes with both benefits and costs
...
Copyrights, Patents Trademarks and Designs are
IPRs
•
Universal Copyright Convention
•
The Paris Convention
•
Patent Co-operation Treaty
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TRIPS
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The
World
Intellectual
Organization (WIPO)
•
UNESCO
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Lesson Round Up
•
Self Test Questions
particularly stimulated by the exciting developments
in scientific and technological activities
...
Newer forms of the protection are also emerging
The study lesson provides an in-depth understanding
to the students about the various forms of the
intellectual property, its relevance and business
impact in the changing global business environment
...
2
PP-IPRL&P
INTRODUCTION
Intellectual property (IP) refers to the creations of the human mind like inventions, literary and artistic works,
and symbols, names, images and designs used in commerce
...
Rights related to copyright include those of performing artists in their
performances, producers of phonograms in their recordings, and those of broadcasters in their radio and
television programs
...
The most noticeable difference between intellectual property and other forms of property, however, is that
intellectual property is intangible, that is, it cannot be defined or identified by its own physical parameters
...
Generally, it encompasses four separate and
distinct types of intangible property namely — patents, trademarks, copyrights, and trade secrets, which
collectively are referred to as “intellectual property
...
In recent
times, geographical indications, protection of plant varieties, protection for semi-conductors and integrated
circuits, and undisclosed information have been brought under the umbrella of intellectual property
...
A Venetian Law of 1474 made the first systematic attempt to protect
inventions by a form of patent, which granted an exclusive right to an individual for the first time
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Towards the end of 19th century, new inventive ways of manufacture helped trigger large-scale
industrialization accompanied by rapid growth of cities, expansion of railway networks, the investment of
capital and a growing transoceanic trade
...
At this
point of time, the International Intellectual Property system also started to take shape with the setting up of
the Paris Convention for the Protection of Industrial Property in 1883 and the Berne Convention for the
Protection of Literary and Artistic Works in 1886
...
Over a period of time and particularly in contemporary corporate paradigm, ideas and knowledge have
become increasingly important parts of trade
...
Films, music
recordings, books, computer software and on-line services are bought and sold because of the information
and creativity they contain, not usually because of the plastic, metal or paper used to make them
...
Therefore,
creators are given the right to prevent others from using their inventions, designs or other creations
...
Lesson 1
Introduction
3
The Convention establishing the World Intellectual Property Organization (1967) gives the following list of the
subject matter protected by intellectual property rights:
•
literary, artistic and scientific works;
•
performances of performing artists, phonograms, and broadcasts;
•
inventions in all fields of human endeavor;
•
scientific discoveries;
•
industrial designs;
•
trademarks, service marks, and commercial names and designations;
•
protection against unfair competition; and
•
“all other rights resulting from intellectual activity in the industrial, scientific, literary or artistic fields
...
It was negotiated at the end of the Uruguay Round of the General Agreement on Tariffs and
Trade (GATT) treaty in 1994
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It addresses applicability of general GATT principles as well as the provisions in
international agreements on IP (Part I)
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Furthermore, it
addresses related dispute prevention and settlement mechanisms (Part V)
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The TRIPS Agreement, which came into effect on 1 January 1995, is to date the most comprehensive
multilateral agreement on intellectual property
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e
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Intellectual Property System in India
As discussed above, historically the first system of protection of intellectual property came in the form of
(Venetian Ordinance) in 1485
...
In the United States, patent laws were introduced in
1760
...
In India Patent Act
was introduced in the year 1856 which remained in force for over 50 years, which was subsequently modified
4
PP-IPRL&P
and amended and was called "The Indian Patents and Designs Act, 1911"
...
Specific statutes protected only certain type of Intellectual output; till recently only four forms were protected
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In India, copyrights
were regulated under the Copyright Act, 1957; patents under Patents Act, 1970; trade marks under Trade
and Merchandise Marks Act 1958; and designs under Designs Act, 1911
...
These included: Trade Marks, called the Trade Mark Act,
1999; Designs Act, 1911 was replaced by the Designs Act, 2000; the Copyright Act, 1957 amended a
number of times, the latest is called Copyright (Amendment) Act, 2012; and the latest amendments made to
the Patents Act, 1970 in 2005
...
These are called Geographical Indications of Goods (Registration and Protection) Act, 1999,
and Protection of Plant Varieties and Farmers’ Rights Act, 2001 respectively
...
In 1990s, many countries unilaterally strengthened their laws
and regulations in this area, and many others were poised to do likewise
...
It is strongly felt that under the global competitive environment, stronger IPR
protection increases incentives for innovation and raises returns to international technology transfer
...
The TRIPS
agreement set minimum standards for protection for IPR rights and also set a time frame within which
countries were required to make changes in their laws to comply with the required degree of protection
...
Patents Act, 1970
After India became a signatory to the TRIPS agreement forming part of the Agreement establishing the
World Trade Organization (WTO) for the purpose of reduction of distortions and impediments to international
trade and promotion of effective and adequate protection of intellectual property rights, the Patents Act, 1970
has been amended in the year 1995, 1999, 2002 and 2005 to meet its obligations under the TRIPS
agreement
...
The amendments were also aimed at making the Act a modern, harmonized
and user-friendly legislation to adequately protect national and public interests while simultaneously meeting
India’s international obligations under the TRIPS Agreement
...
These rules have been further amended by Patents (Amendment) Rules 2005 w
...
f 01
...
2005
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Trade Mark Act, 1999
The law of trademarks is also now modernized under the Trademarks Act of 1999
...
In India the trademarks have been protected for over four decades as per the provisions of the
Trade and Merchandise Mark (TMM) Act of 1958
...
One
of the agreements in that related to the Intellectual Property Rights (TRIPS)
...
Meanwhile, the modernisation of Trade and Merchandise Marks Act, 1958 had been taken up keeping in
view the current developments in trading and commercial practices, increasing globalisation of trade and
industry, the need to encourage investment flows and transfer of technology, need for simplification of
trademark management system and to give effect to important judicial decisions
...
The Bill pointed towards the changes which were contemplated and were under consideration of the
Government of India, but it lapsed in 1994
...
The Trademarks Bill of 1999 was passed by Parliament that received the assent of the President on 30th
December, 1999 as Trade Marks Act, 1999 thereby replacing the Trade and Merchandise Mark Act of 1958
...
•
An action for infringement will also be available against the unauthorised use of a mark in relation to
dissimilar goods, if such mark is similar to a registered mark that is well known in India and the
interest of the owner is likely to be affected adversely
...
The Designs Act, 2000
The Designs Act of 1911 has been replaced by the Designs Act, 2000
...
In this backdrop, the Designs Act,
2000 has been enacted essentially to balance these interests and to ensure that the law does not
unnecessarily extend protection beyond what is necessary to create the required incentive for design activity
while removing impediments to the free use of available designs
...
Industrial Design law deals with the aesthetics or the original design of an industrial product
...
The design law excludes from its purview the functioning features of an article and grants protection only to
those which have an aesthetic appeal
...
These are functional features that cannot be registered
...
Similarly, a table, for example, would have a flat
surface on which other objects can be placed
...
But its shape, colour or the way
it is supported by legs or otherwise, are all elements of design or artistic elements and therefore, registrable
if unique and novel
...
It has become important therefore, to grant to an original industrial design adequate
protection
...
Law, however,
requires that it is only the aesthetics or the design element which can be registered and protected
...
Particularly, while exporting furniture, it is necessary to be sure that the design of the furniture is not
registered either as a patent or design in the country of export
...
Conversely, if furniture of ethnic design is being
exported, and the design is an original design complying with the requirements of the definition of 'design'
under the Designs Act, it would be worthwhile having it registered in the country to which the product is being
exported so that others may not imitate it and deprive the inventor of that design of the commercial benefits
of his design
...
(b) Amplifying the scope of "prior publication"
...
(d) Provision of identification of non-registrable designs
...
(f) Substitution of Indian classification by internationally followed system of classification
...
(h) Provision for restoration of lapsed designs
...
(j) Revoking of period of secrecy of two years of a registered design
...
(l) Introduction of additional grounds in cancellation proceedings and provision for initiating the
cancellation proceedings before the Controller in place of High Court
...
(n) Provision for grounds of cancellation to be taken as defence in the infringement proceedings to be
in any court not below the Court of District Judge
...
(p) Provision for allowance of priority to other convention countries and countries belonging to the
group of countries or inter-governmental organizations apart from United Kingdom and other
Commonwealth Countries
...
Lesson 1
Introduction
7
The Geographical Indications of Goods (Registration and Protection ) Act, 1999
Until recently, Geographical indications were not registrable in India and in the absence of statutory
protection, Indian geographical indications had been misused by persons outside India to indicate goods not
originating from the named locality in India
...
Mention should be made that under
the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS), there is no obligation for
other countries to extend reciprocal protection unless a geographical indication is protected in the country of
its origin
...
To cover up such situations it became necessary to have a comprehensive legislation for registration and for
providing adequate protection to geographical indications and accordingly the Parliament has passed a
legislation, namely, the Geographical indication of Goods (Registration and Protection) Act, 1999
...
The salient features of this legislation are as under:
(a) Provision of definition of several important terms like "geographical indication", "goods",
"producers", "packages", "registered proprietor", "authorized user" etc
...
for maintenance of such Register
...
(c) Registration of geographical indications of goods in specified classes
...
(e) Provisions for framing of rules by Central Government for filing of application, its contents and
matters relating to substantive examination of geographical indication applications
...
(g) Registration of authorized users of registered geographical indications and providing provisions for
taking infringement action either by a registered proprietor or an authorized user
...
(i) Prohibition of assignment etc
...
(j) Prohibition of registration of geographical indication as a trademark
...
(l) Provision relating to offences and penalties
...
(n) Provision for reciprocity powers of the registrar, maintenance of Index, protection of homonymous
geographical indications etc
...
This Act has been amended several times to keep
pace with the changing times
...
Copyright and related rights on cultural goods, products and services, arise from individual or
collective creativity
...
Copyright laws distinguish between different classes of works
such as literary, artistic, musical works and sound recordings and cinematograph films
...
Copyright protection also includes novel rights which involve the right to claim authorship of a work, and the
right to oppose changes to it that could harm the creator's reputation
...
The
owner may obtain court orders to stop such activities, as well as seek damages for loss of financial rewards
and recognition
...
The Copyright Act, 1957, was amended
in 1984 and computer programming was included with the definition of "literary work
...
The greatest fear and challenges to the copyright industry is the piracy of works whether, books, musical
works, films, television programmes or computer software or computer database
...
The new section provides that any person who
knowingly makes use on a computer of an infringed copy of a computer programme will be punishable with
imprisonment for a term of not less than seven days, which may extend to three years and with a fine of not
less than ` 50,000/- and which may extend to ` 2,00,000/-
...
The Copyright (Amendment) Act, 1999 makes it free for purchaser of a gadget/equipment to sell it
onwards if the item being transacted is not the main item covered under the Copyright Act
...
This amendment also ensures fair dealing of 'broadcasting' gaining popularity
with the growth of the Internet
...
The Protection of Plant Varieties and Farmers’ Rights Act, 2001
The concept of Plant Breeders’ Rights arises from the need to provide incentives to plant breeders engaged
in the creative work of research which sustains agricultural progress through returns on investments made in
research and to persuade the researcher to share the benefits of his creativity with society
...
Article 27 of TRIPS Agreement defines
patentable subject matter and requires member countries to provide for the protection of plant varieties
whether by patenting or by an effective sui generis system or by any combination thereof
...
This Act seeks to stimulate investment for research and development both in
the public and private sectors for the development of new plant varieties by ensuring appropriate returns on
such investments
...
It also recognizes the role of farmers as cultivators and conservers and the contribution of traditional, rural
and tribal communities to the country’s agro biodiversity by rewarding them for their contribution through
benefit sharing and protecting the traditional rights of the farmers
...
The Semi Conductor Integrated Circuits Layout Design Act, 2000
Electronics and Information technology is one of the fastest growing sectors that has played a significant role
in world economy
...
Microelectronics, which primarily refers to Integrated Circuits (ICs) ranging from, Small
Scale Integration (SSI) to Very Large Scale Integration (VLSI) on a semiconductor chip - has rightly been
recognized as a core, strategic technology world-over, especially for Information Technology (IT) based
society
...
Therefore, protection of Intellectual Property Rights (IPR) embedded in the layout designs is of utmost
importance to encourage continued investments in R & D to result in technological advancements in the field
of microelectronics
...
This was because of the fact that in the context of Layout Designs, the concept of
“originality” is of utmost significance, whether it is a “novelty or not”
...
In view of the above, the necessity for
providing protection for Layout-Designs of Integrated Circuits was felt to reward and encourage an adequate
level of investment of human, financial and technological resources
...
Trade Related Intellectual Property Rights
(TRIPS) Agreement under WTO contains provisions with regard to setting up of standards concerning
availability, scope and use of Intellectual Property Rights, Geographical Indications, Layout-Design of
Integrated Circuits etc
...
To conclude, the various modifications and amendments to earlier Intellectual Property Laws are an
indication of India's move towards new IPR regime so as to prepare ourselves for the global trade
competition
...
Usually these are
manufacturing or industrial secrets and commercial secrets
...
Contrary to patents, trade secrets are protected without registration
...
Considering the vast availability of traditional knowledge in the country, the protection under this will be very
crucial in reaping benefits from such type of knowledge
...
In its
basic definition, which may vary from one country (where such protection is available) to another, a utility
model is similar to a patent
...
"
Only a small but significant number of countries and regions provide the option of utility model protection
...
The main differences between utility models and patents are the following:
The requirements for acquiring a utility model are less stringent than for patents
...
In practice, protection for utility models is often sought for innovations of a rather incremental
character which may not meet the patentability criteria
...
In most countries where utility model protection is available, patent offices do not examine applications as to
substance prior to registration
...
Utility models are much cheaper to obtain and to maintain
...
Utility models are considered suitable particularly for SMEs that make "minor" improvements to, and
adaptations of, existing products
...
The "Innovation patent," launched in Australia some time back was introduced as a result of extensive
research into the needs of small and medium-sized enteprises, with the aim of providing a "low-cost entry
point into the intellectual property system
...
Biodiversity
is the foundation of life on Earth
...
By changing biodiversity, we strongly affect human well-being
and the well-being of every other living creature
...
Diverse activities and actions have been taken by
several stakeholders at local, state, national and international level to conserve/protect the valuable resource
such as biodiversity to draw the benefits accrued in it for the society
...
e
...
Until the advent of molecular
biology and genetic engineering, the success of plant breeding depended on access to genetic variability
within a species
...
The developed countries are not rich in biogenetic resources but are better equipped in research and
development
...
As a result, there
is a beginning in the unprotected flow of genetic information from the developing countries to the capital-rich
west, and a protected flow in the reverse direction mainly through patents and Plant Breeders’ Rights (PBR)
...
Genetic erosion is one of the most important invisible impacts that is
in the long run manifested visibly with the loss of biodiversity
...
The interface between
biodiversity and intellectual property is shaped at the international level by several treaties and process,
including at the WIPO, and the TRIPS Council of the WTO
...
The Convention seeks to address all threats to biodiversity and
ecosystem services, including threats from climate change, through scientific assessments, the development
of tools, incentives and processes, the transfer of technologies and good practices and the full and active
involvement of relevant stakeholders including indigenous and local communities, youth, NGOs, women and
the business community
...
It seeks to protect biological diversity from the potential risks posed by living modified organisms resulting
from modern biotechnology
...
"
The Convention reaffirms the principle of state sovereignty, which grants states sovereign rights to exploit their
resources pursuant to their own environmental policies together with the responsibility to ensure that activities
within their own jurisdiction or control do not cause damage to the environment of other states
...
India is a party to the Convention on Biological Diversity (1992)
...
However, the
expansion of international trade agreements establishing a global regime of intellectual property rights
creates incentives that may destroy biodiversity, while undercutting social and economic development
opportunities as well as cultural diversity
...
12
PP-IPRL&P
India also followed the suit by placing in place legal frameworks for the management of biodiversity and
Intellectual property laws
...
The Biological Diversity Act aims at
conservation of biological resources and associated knowledge as well as facilitating access to them in a
sustainable manner and through a just process
...
Those rights do not apply to the physical object in which the
creation may be embodied but instead to the intellectual creation as such
...
One is to give statutory expression to the moral and
economic rights of creators in their creations and the rights of the public in access to those creations
...
It is generally agreed that knowledge and inventions have played an important role in economic growth of the
countries
...
Additionally the growing importance of intellectual property and the new pattern of global trade provided
impetus for forging a connection between intellectual property policies and trade law and led to the inclusion
of the TRIPS Agreement as one of the agreements in the framework of the multilateral trade negotiations
under the Uruguay Round
...
Intellectual property indeed is now one of the valuable assets in commercial transactions, be it intellectual
property licensing, joint ventures, foreign collaborations, manufacturing, purchase or distribution agreements,
or mergers and acquisitions
...
These licences
provide royalty revenues to the owner of the Intellectual Property, and distribute products and technologies to
licensees who might not otherwise have had access to them
...
This creates a very productive cycle of innovation
and invention and adds to the revenues of the companies
...
With global demand for patents rising from 800,000 applications in the early
1980s to 1
...
As a result, IP policy has moved to the
forefront of innovation policy
...
Incremental
and more local forms of innovation contribute to economic and social development, on a par with world-class
technological innovations
...
The buyers and sellers of intellectual property manage their intellectual property as
financial assets just as investors in stocks, options and other financial instruments
...
Enforced intellectual property rights ensure products are authentic, and of
the high-quality that consumers recognize and expect
...
Leading International Instruments Concerning IPR
The International Intellectual Property System is in fact a system of accumulated practices rather than a set
of fixed rules
...
It may be emphasised that a
country’s laws defining the rights of the foreigners form part of the international system even when, the
country is not party to any international treaty on the subject, for such laws form the basis upon which in
practice intellectual property is protected in more than one country
...
These Conventions are administered by World Intellectual Property Organisation, popularly known as WIPO
...
It is
dedicated to developing a balanced and accessible international intellectual property (IP) system, which
rewards creativity, stimulates innovation and contributes to economic development while safeguarding the
public interest
...
Its headquarters are in Geneva, Switzerland
...
The need for international
protection of intellectual property became evident when foreign exhibitors refused to attend the International
Exhibition of Inventions in Vienna in 1873 because they were afraid their ideas would be stolen and exploited
commercially in other countries
...
The Paris Convention entered into force in 1884 with 14
member States, which set up an International Bureau to carry out administrative tasks, such as organizing
meetings of the member States
...
Like the
Paris Convention, the Berne Convention set up an International Bureau to carry out administrative tasks
...
The BIRPI indeed was the predecessor of the
World Intellectual Property Organization
...
In 1960 BIRPI moved from Berne to Geneva to be closer to the United Nations and other
international organizations in that city
...
Even the well-drafted treaty is powerless without member States to bring its provisions to life, so WIPO
actively encourages States to sign its treaties and to enforce them
...
WIPO also initiated a
new policy to adapt to rapid changes in the field of industrial property, by using new options to speed up the
development of internationally harmonized principles and rules
...
WIPO and WTO
WIPO expanded its role and further demonstrated the importance of intellectual property rights in the
management of globalized trade in 1996 by entering into a cooperation agreement with the World Trade
Organization (WTO)
...
In July 1998, a joint initiative to help developing countries meet their TRIPS
obligations till the year 2000 was launched
...
Paris Convention for the Protection of Industrial Property
The Paris Union, established by the Convention, has an Assembly and an Executive Committee
...
The members of the Executive Committee are elected from among
the members of the Union, except for Switzerland, which is a member ex officio
...
The Convention applies to industrial property in the widest sense, including patents, marks, industrial
designs, utility models, trade names, geographical indications and the repression of unfair competition
...
National Treatment
Under the provisions on national treatment, the Convention provides that, as regards the protection of
industrial property, each contracting State must grant the same protection to nationals of the other
contracting States as it grants to its own nationals
...
Right of Priority
The Convention provides for the right of priority in the case of patents, marks and industrial designs
...
In other words,
these later applications have priority over applications which may have been filed during the said period of
time by other persons for the same invention, utility model, mark or industrial design
...
One of the major practical advantages of right of priority is that, when an applicant desires
protection in several countries, he is not required to present all his applications at the same time but has six
or 12 months at his disposal to decide in which countries he wishes protection and to organize with due care
the steps needed to secure protection
...
The more
important are the following:
Patents
1
...
2
...
3
...
4
...
5
...
6
...
Thus, a compulsory license based on failure to work the
patented invention may only be granted pursuant to a request filed after three or four years of failure
to work or insufficient working of the patented invention and it must be refused if the patentee gives
legitimate reasons to justify his inaction
...
Forfeiture of a patent may not be provided for, except in cases where the grant of a compulsory
license would not have been sufficient to prevent the abuse
...
Marks
(1) The Paris Convention does not regulate the conditions for the filing and registration of marks which
are therefore determined in each contracting State by the domestic law
...
Once the registration of a mark is obtained in a contracting State, it
is independent of its possible registration in any other country, including the country of origin;
consequently
...
(3) Where a mark has been duly registered in the country of origin, it must, on request, be accepted for
filing and protected in its original form in the other contracting States
...
(5) If, in any contracting State, the use of a registered mark is compulsory, the registration cannot be
canceled until after a reasonable period, and only if the owner cannot justify his inaction
...
(7) Each contracting State must likewise refuse registration and prohibit the use of marks which consist
of or contain without authorization, armorial bearings, State emblems and official signs and
hallmarks of contracting states, provided they have been communicated through the International
Bureau of WIPO
...
(9) Collective marks must be granted protection
...
Trade Names
Protection must be granted to trade names in each contracting State without the obligation of filing or
registration
...
Lesson 1
Introduction
17
Unfair Competition
Each contracting State must provide for effective protection against unfair competition
...
The Union has an Assembly
...
Some of the most important tasks of the Assembly areThe amendment of the Regulations issued under the Treaty, the adoption of the biennial program and
budget of the Union, and the fixing of certain fees connected with the use of the PCT system
...
The average
number of designations per application was 6
...
The PCT was concluded in 1970, amended in 1979 and modified in 1984 and 2001
...
Instruments of ratification or
accession must be deposited with the Director General of WIPO
...
The application may be filed
by anyone who is a national or resident of a contracting State, with the national patent office of the
contracting State of which the applicant is a national or resident or, at the applicant’s option, with the
International Bureau of WIPO in Geneva
...
The Treaty regulates in detail the formal requirements with which any international application must comply
...
The effect of the international application in each designated
State is the same as if a national patent application had been filed with the national patent office of that
State
...
Where a designated State is party to the Eurasian Patent
Convention, the applicant may opt for the effect of a Eurasian patent
...
Where a designated
State is a member of the African Intellectual Property Organization (OAPI), the effect of the designation is
automatically that of a regional application filed with OAPI
...
The international search report is communicated to the applicant who may decide to withdraw his application,
in particular where the content of the report suggests that the granting of patents is unlikely
...
If the applicant decides to continue with the international application with a view to obtaining national (or
18
PP-IPRL&P
regional) patents, he can wait until the end of the 20th month after the filing of the international application or,
where that application claims the priority of an earlier application, until the end of the 20th month after the
filing of that earlier application, to commence the national procedure before each designated Office by
furnishing a translation (where necessary) of the application into the official language of that Office and
paying prescribed fees
...
The applicant is however entitled to amend the international application during the international
preliminary examination
...
The PCT filing assures the
applicant that if his international application is in the form prescribed by the PCT, it cannot be
rejected on formal grounds by any designated Office during the national phase of the processing of
the application
...
On the basis of the international
preliminary examination report, that probability is even stronger; the applicant has the possibility to
amend the international application to put it in order before processing by the designated Offices
...
Every country member of the Union which
has adhered to at least the administrative and final provisions of the Stockholm Act is a member of the
Assembly
...
The Berne Convention, concluded in 1886, was revised at Paris in 1896 and at Berlin in 1908, completed at
Berne in 1914, revised at Rome in 1928, at Brussels in 1948, at Stockholm in 1967 and at Paris in 1971, and
was amended in 1979
...
Basic Principles
The three basic principles are the following:
1
...
2
...
3
...
If,
however, a contracting State provides for a longer term than the minimum prescribed by the
Convention and the work ceases to be protected in the country of origin, protection may be denied
once protection in the country of origin ceases
...
As to works, the protection must include every production in the literary, scientific and artistic
domain, whatever may be the mode or form of its expression
...
Subject to certain permitted reservations, limitations or exceptions, the following are among the
rights which must be recognized as exclusive rights of authorization:
•
the right to translate,
•
the right to make adaptations and arrangements of the work,
•
the right to perform in public dramatic, dramatico-musical and musical works,
•
the right to recite in public literary works,
•
the right to communicate to the public the performance of such works,
•
the right to broadcast (with the possibility of a contracting State to provide for a mere right to
equitable remuneration instead of a right of authorization),
•
the right to make reproductions in any manner or form,
•
the right to use the work as a basis for an audiovisual work, and the right to reproduce,
distribute, perform in public or communicate to the public that audiovisual work
...
Duration of Protection
The general rule is that protection must be granted until the expiration of the 50th year after the author’s
death
...
In the case of anonymous or pseudonymous
works, the term of protection expires 50 years after the work has been lawfully made available to the public,
except if the pseudonym leaves no doubt as to the author’s identity or if the author discloses his identity
during that period; in the latter case, the general rule applies
...
In the case of works of applied art and photographic works, the minimum term is 25 years from the creation
of such a work
...
It was negotiated at the end of the Uruguay Round of the General Agreement on Tariffs and
Trade (GATT) treaty in 1994
...
These objectives include the reduction of
20
PP-IPRL&P
distortions and impediments to international trade, promotion of effective and adequate protection of
intellectual property rights, and ensuring that measures and procedures to enforce intellectual property rights
do not themselves become barriers to legitimate trade
...
It addresses applicability of general GATT principles as well as the provisions in
international agreements on IP (Part I)
...
Furthermore, it
addresses related dispute prevention and settlement mechanisms (Part V)
...
The obligations under TRIPS apply equally to all member states
...
The transition period for developing countries expired in 2005
...
The TRIPS Agreement, which came into effect on 1 January 1995, is to date the most comprehensive
multilateral agreement on intellectual property
...
e
...
Issues Covered under TRIPS Agreement
The TRIPS agreement broadly focuses on following issues:
— How basic principles of the trading system and other international intellectual property agreements
should be applied
...
— How countries should enforce those rights adequately in their own territories
...
—
Special transitional agreements during the period when the new system is being introduced
...
Enforcement: The second main set of provisions deals with domestic procedures and remedies for
Lesson 1
Introduction
21
the enforcement of intellectual property rights
...
Dispute settlement: The Agreement makes disputes between WTO Members about the respect of
the TRIPS obligations subject to the WTO's dispute settlement procedures
...
The TRIPS Agreement is a minimum standards agreement, which allows Members to provide more
extensive protection of intellectual property if they so wish
...
Protection of Intellectual Property under TRIPS
The TRIPS Agreement provides for protection of various kinds of intellectual property rights to ensure that
adequate standards of protection exist in all member countries
...
) and the Berne Convention for the Protection of Literary and Artistic Works
(copyright)
...
So the TRIPS agreement adds a significant
number of new or higher standards for the protection of intellectual property rights
...
Copyright and Related Rights
The TRIPS Agreement requires member countries to comply with the basic standards of the Berne
Convention
...
1 of the Agreement which makes reference to the Berne
Convention for the Protection of Literary and Artistic Works of 1971 and establishes that Members should
comply with Articles 1 through 21 and the Appendix thereto
...
e
...
The provisions of the Berne Convention referred to deal with
questions such as subject-matter to be protected, minimum term of protection, and rights to be conferred and
permissible limitations to those rights
...
That apart, the TRIPS
Agreement clarifies and adds certain specific points
...
2 of the Agreement confirms that copyright protection shall extend to expressions and not to ideas,
procedures, methods of operation or mathematical concepts as such
...
1 provides that computer programs, whether in source or
object code, shall be protected as literary works under the Berne Convention (1971)
...
It confirms further, that the form in
which a program is, whether in source or object code, does not affect the protection
...
g
...
It also confirms that the general term of protection of 50 years
applies to computer programs
...
Article 10
...
Databases are
eligible for copyright protection provided that they by reason of the selection or arrangement of their contents
constitute intellectual creations
...
Furthermore, the provision clarifies that
such protection shall not extend to the data or material itself, and that it shall be without prejudice to any
copyright subsisting in the data or material itself
...
With respect to cinematographic works, the
exclusive rental right is subject to the so-called impairment test: a Member is excepted from the obligation
unless such rental has led to widespread copying of such works which is materially impairing the exclusive
right of reproduction conferred in that Member on authors and their successors in title
...
Term of protection: According to the general rule contained in Article 7(1) of the Berne Convention as
incorporated into the TRIPS Agreement, the term of protection shall be the life of the author and 50 years
after his death
...
These
provisions are supplemented by Article 12 of the TRIPS Agreement, which provides that whenever the term
of protection of a work, other than a photographic work or a work of applied art, is calculated on a basis other
than the life of a natural person, such term shall be no less than 50 years from the end of the calendar year
of authorized publication or failing such authorized publication within 50 years from the making of the work,
50 years from the end of the calendar year of making
...
Protection of Performers, Producers of Phonograms and Broadcasting Organizations: The provisions on
protection of performers, producers of phonograms and broadcasting organizations are included in Article
14
...
1, performers shall have the possibility of preventing the unauthorized fixation of
their performance on a phonogram (e
...
the recording of a live musical performance)
...
Performers must also be in a position to prevent the reproduction
of such fixations
...
In accordance with Article 14
...
In addition to this, they have to grant, in accordance with Article 14
...
The provisions on rental rights apply also to any other right holders in
phonograms as determined in national law
...
Therefore it is not subject to the impairment test as in respect of cinematographic works
...
e
...
Broadcasting organizations shall have, in accordance with Article 14
...
However, it is not necessary to grant such rights
to broadcasting organizations, if owners of copyright in the subject-matter of broadcasts are provided with
the possibility of preventing these acts, subject to the provisions of the Berne Convention
...
6]
...
5 is at least 50 years for performers and producers of phonograms,
and 20 years for broadcasting organizations
...
Such signs, in particular words including personal names, letters, numerals, figurative elements and
combinations of colours as well as any combination of such signs, must be eligible for registration as
trademarks
...
Members are free to determine whether to allow the
registration of signs that is not visually perceptible (e
...
sound or smell marks)
...
However, actual use of a trademark shall not be permitted
as a condition for filing an application for registration, and at least three years must have passed after that
filing date before failure to realize an intent to use is allowed as the ground for refusing the application
(Article 14
...
The Agreement requires service marks to be protected in the same way as marks distinguishing goods
...
In case of the use of an identical sign for identical
goods or services, a likelihood of confusion must be presumed (Article 16
...
The TRIPS Agreement contains certain provisions on well-known marks, which supplement the protection
required by Article 6bis of the Paris Convention, as incorporated by reference into the TRIPS Agreement,
which obliges Members to refuse or to cancel the registration, and to prohibit the use of a mark conflicting
with a mark which is well known
...
Second,
it is required that knowledge in the relevant sector of the public acquired not only as a result of the use of the
mark but also by other means, including as a result of its promotion, be taken into account
...
2 and 3)
...
Term of protection: Initial registration and each renewal of registration, of a trademark shall be for a term of
no less than seven years
...
Requirement of Use: Cancellation of a mark on the grounds of non-use cannot take place before three years
of uninterrupted non-use has elapsed unless valid reasons based on the existence of obstacles to such use
are shown by the trademark owner
...
Use of a trademark by another person, when subject to the control of its owner, must be
recognized as use of the trademark for the purpose of maintaining the registration (Article 19)
...
Licensing and Assignment: Members may determine conditions on the licensing and assignment of
trademarks
...
Geographical indications
Place names are sometimes used to identify a product
...
Wine and spirits makers are
particularly concerned about the use of place-names to identify products and the TRIPs agreement contains
special provisions for these products
...
1)
...
2)
...
3)
...
This applies even where the public is not being misled, there is no unfair
competition and the true origin of the good is indicated or the geographical indication is accompanied by
expressions such as “kind”, “type”, “style”, “imitation” or the like
...
Protection against registration of a
trademark must be provided accordingly
...
These
Lesson 1
Introduction
25
exceptions are of particular relevance in respect of the additional protection for geographical indications for
wines and spirits
...
Measures to
implement these provisions shall not prejudice prior trademark rights that have been acquired in good faith
(paragraph 5)
...
Members availing themselves of the use of
these exceptions must be willing to enter into negotiations about their continued application to individual
geographical indications (paragraph 1)
...
The
TRIPS Council shall keep under review the application of the provisions on the protection of geographical
indications (paragraph 2)
...
1 of the TRIPS Agreement obliges Members to provide for the
protection of independently created industrial designs that are new or original
...
Members may provide that such protection shall not extend to designs dictated
essentially by technical or functional considerations
...
2 contains a special provision aimed at taking into account the short life cycle and sheer number of
new designs in the textile sector; requirements for securing protection of such designs, in particular in regard
to any cost, examination or publication, must not unreasonably impair the opportunity to seek and obtain
such protection
...
Protection: Article 26
...
Article 26
...
Duration of protection: The duration of protection available shall amount to at least 10 years
...
It is also required that patents be
available and patent rights enjoyable without discrimination as to the place of invention and whether products
are imported or locally produced (Article 27
...
There are three permissible exceptions to the basic rule on patentability
...
The use of this exception is subject to the condition that the
commercial exploitation of the invention must also be prevented and this prevention must be necessary for
the protection of ordre public or morality (Article 27
...
26
PP-IPRL&P
The second exception is that Members may exclude from patentability diagnostic, therapeutic and surgical
methods for the treatment of humans or animals (Article 27
...
The third is that Members may exclude plants and animals other than micro-organisms and essentially
biological processes for the production of plants or animals other than non-biological and microbiological
processes
...
Moreover, the whole provision is subject to review four years after entry into
force of the Agreement (Article 27
...
Rights Conferred: The exclusive rights that must be conferred by a product patent are the ones of making,
using, offering for sale, selling, and importing for these purposes
...
Patent owners shall
also have the right to assign, or transfer by succession, the patent and to conclude licensing contracts
(Article 28)
...
Term of protection: The term of protection available shall not end before the expiration of a period of 20
years counted from the filing date (Article 33)
...
1)
...
Other Use Without Authorization of the Right Holder: Compulsory licensing and government use without the
authorization of the right holder are allowed, but are made subject to conditions aimed at protecting the
legitimate interests of the right holder
...
These include the
obligation, as a general rule, to grant such licences only if an unsuccessful attempt has been made to
acquire a voluntary licence on reasonable terms and conditions within a reasonable period of time; the
requirement to pay adequate remuneration in the circumstances of each case, taking into account the
economic value of the licence; and a requirement that decisions be subject to judicial or other independent
review by a distinct higher authority
...
These
conditions should be read together with the related provisions of Article 27
...
Layout-Designs of Integrated Circuits
Article 35 of the TRIPS Agreement requires Member countries to protect the layout-designs of integrated
circuits in accordance with the provisions of the IPIC Treaty (the Treaty on Intellectual Property in Respect of
Integrated Circuits), negotiated under the auspices of WIPO in 1989
...
In addition to requiring Member countries to protect the layout-designs of integrated circuits in accordance
with the provisions of the IPIC Treaty, the TRIPS Agreement clarifies and/or builds on four points
...
1)
...
2)
...
According to Article 39
...
The
Agreement does not require undisclosed information to be treated as a form of property, but it does require
that a person lawfully in control of such information must have the possibility of preventing it from being
disclosed to, acquired by, or used by others without his or her consent in a manner contrary to honest
commercial practices
...
The Agreement also contains provisions on undisclosed test data and other data whose submission is
required by governments as a condition of approving the marketing of pharmaceutical or agricultural
chemical products which use new chemical entities
...
In addition, Members must protect such data against
disclosure, except where necessary to protect the public, or unless steps are taken to ensure that the data
are protected against unfair commercial use
...
The first Section lays down general obligations that all enforcement procedures must meet
...
The
following Sections deal with civil and administrative procedures and remedies, provisional measures, special
requirements related to border measures and criminal procedures
...
The Agreement makes a distinction between infringing activity in general, in respect of which civil judicial
procedures and remedies must be available, and counterfeiting and piracy -- the more blatant and egregious
forms of infringing activity -- in respect of which additional procedures and remedies must also be provided,
namely border measures and criminal procedures
...
28
PP-IPRL&P
UNSECO
Copyright a traditional tool for encouraging creativity nowadays, has even greater potential to encourage
st
creativity in the beginning of the 21 century
...
It conducts, in the framework of the Global Alliance for Cultural Diversity, awareness-raising and
capacity-building projects, in addition to information, training and research in the field of copyright law
...
The digital revolution has not left copyright protection unaffected
...
LESSON ROUND UP
•
Intellectual property encompasses the properties that are the creations of the human mind, labour, capital
and intellect
...
•
The most noticeable difference between intellectual property and other forms of property, however, is that
intellectual property is intangible, that is, it cannot be defined or identified by its own physical parameters
...
•
With the establishment of the world trade Organization (WTO), the importance and role of the intellectual
property protection has been crystallized in the Trade -Related Intellectual Property Systems (TRIPS)
Agreement
...
The areas of intellectual property that it covers are:
(i) Copyright and related rights (i
...
the rights of performers, producers of sound recordings and broadcasting
organisations);
(ii) trade marks including service marks;
(iii) Geographical indications including appellations of origin;
(iv) Industrial designs;
(v) Patents including protection of new varieties of plants;
(vi) the lay-out designs (topographies) of integrated circuits;
(vii) the undisclosed information including trade secrets and test data
...
The law of
trademarks is also now modernized under the Trademarks Act of 1999
...
The most notable amendment was
introduced in 1984 including “computer programmes” within the definition of "literary work”
...
This resulted into controversial cases like turmeric, neem
and basmati
...
•
TRIPS Agreement under WTO contains provisions with regard to setting up of standards concerning
availability, scope and use of Intellectual Property Rights, Geographical Indications, Layout-Design of
Integrated Circuits etc
...
The various modifications and amendments to earlier Intellectual Property Laws are an
indication of India's move towards new IPR regime so as to prepare ourselves for the global trade
competition
...
At
present India does not have legislation on Utility Models
...
The Biological Diversity Act aims at conservation of biological
resources and associated knowledge as well as facilitating access to them in a sustainable manner and
through a just process
...
Enforced intellectual property rights ensure that products are
authentic, and of the high-quality that consumers recognize and expect
...
•
There are number of International Treaties/Conventions which deal with the various aspects of intellectual
property and industrial property
...
SELF TEST QUESTIONS
These are meant for re-capitulation only
...
1
...
What are “intellectual property rights?
3
...
What are the legislations covering IPRs in India?
5
...
India provides protection to Intellectual Property Rights in accordance with its obligations under the
TRIPS Agreement of the WTO
...
7
...
8
...
9
...
Does India have legislation on
Utility models?
30
PP-IPRL&P
10
...
11
...
What are the objects and purposes behind plant varieties protection law?
13
...
14
...
15
...
16
...
How does WIPO promote the protection of intellectual property?
18
...
Lesson 2
PATENTS
LESSON OUTLINE
LEARNING OBJECTIVES
Inventions arising from the creative work of human
beings acquire considerable commercial value, in
•
Concept of Patent
•
Product/Process Patents & Terminology
•
Duration of Patents
view of the possibility of their use by large sections of
the society not only within the country but also in
•
Elements of Patentability
other countries of the world
...
In India
•
Procedure for Opposition
•
Revocation of Patents
very few scientific organizations and much less
industries take adequate measures to protect their
•
Assignment and licensing of Patents
•
Compulsory Licensing
•
Patent Agent
•
Lesson Round Up
•
Self Test Questions
inventions
...
This Act has been amended in the
year 1995, 1999, 2002 and 2005 to meet India’s
obligations under the agreement on Trade Related
Aspects of Intellectual Property Rights (TRIPS)
forming part of the Agreement establishing the World
Trade Organisation (WTO)
...
The importance of patents has increased
tremendously over last few decades
...
It is important to
know the advantages involved in getting a patent and
how does the patent benefit an inventor
...
32
PP-IPRL&P
CONCEPT OF PATENT
The creative work of the human mind is protected through several measures and the main motivation for the
same is that such protection is a definite measure of encouragement for the creative activity
...
Patents being one of them
...
Underlying economic and commercial justification for the patent system is that it acts as a stimulus
to investment in the Industrial innovation
...
The grant of first patent can be traced as far back as 500 B
...
It was the city dominated by gaurmands, and
perhaps the first, to grant what we now-a-days call patent right to promote culinary art
...
As the practice was extended
to other Greek cities and to other crafts and commodities, it acquired a name ‘monopoly’, a Greek
Portmanteau word from mono (alone) and polein (sale)
...
History shows that in 15th Century
in Venice there had been systematic use of monopoly privileges for inventors for the encouragement of
invention
...
The inventors were also required to put their invention in commercial use within a specified period
...
Early laws in American colonies served primarily to
encourage foreign manufacturers to establish new industries in the colonies by providing them protected
domestic markets
...
In 1623, the English Parliament adopted a Statute of monopolies which recognised
the inventors patent as a justifiable monopoly to be distinguished from other monopoly privileges
...
In England during the 16th and 17th Century, the inventor’s patent of monopoly had become of great national
importance
...
The origin of the Indian Patent System could be traced to the Act of 1856 granting exclusive privileges to
inventors
...
It was, however, generally felt that the
patent law had done little good to the people of the country
...
It did not help at all in the promotion of scientific research and
industrialization in the country, and it curbed the innovativeness and inventiveness of Indians
...
) Bakshi Tek Chand, a retired judge of the Lahore High Court, to undertake a comprehensive
review of the working of the 1911 Act
...
It
also observed that the Patent Act should contain a clear indication that food and medicine and surgical and
curative devices were to be made available to the public at the cheapest price commensurate with giving
reasonable compensation to the patentee
...
In 1952, a further amendment was made (by Act LXX of 1952) to provide for
compulsory license in respect of food and medicines, insecticide, germicide or fungicide, and a process for
producing substance or any invention relating to surgical or curative devices
...
59 of 1953) in Parliament, but the bill
was not pressed and it was allowed to lapse
...
Rajagopala
Ayyangar to take a fresh look at the law of patent and to completely revamp and recast it to best sub-serve
the contemporary needs of the country
...
Justice Ayyangar submitted
a comprehensive Report on Patent Law Revision in September 1959 and the new law of patent, namely, the
Patents Act, 1970, came to be enacted mainly based on the recommendations of the report, and came into
force on April 20, 1972 replacing the Patents and Designs Act, 1911
...
Patents Act, 1970
The Patents Act, 1970 remained in force for about 24 years without any change till December 1994
...
The said philosophy is being implemented through compulsory licensing,
registration of only process patents for food, medicine or drug, pesticides and substances produced by
chemical processes which, apart from chemical substances normally understood, also include items such as
alloys, optical glass, semi-conductors, inter metallic compounds etc
...
Thus, the Patents Act 1970 was expected to provide a reasonable balance
between adequate and effective protection of patents on the one hand and the technology development,
public interest and specific needs of the country on the other hand
...
Therefore, India was put under the contractual
obligation to amend its Patents Act in compliance with the provisions of TRIPS
...
Accordingly an Ordinance effecting certain changes in the Act was issued on
31st December 1994, which ceased to operate after six months
...
This Ordinance was subsequently replaced by the Patents (Amendment) Act, 1999 that was
brought into force retrospectively from 1st January, 1995
...
However, such applications were to be examined only after 31-12-2004
...
India amended its Patents Act again in 2002 through the Patents (Amendment) Act, 2002 increasing the term
of patent to 20 years for all technology, Reversal of burden of proof, compulsory licences etc
...
34
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The third amendment to the Patents Act 1970 was introduced through the Patents (Amendment) Ordinance,
2004 w
...
f
...
This Ordinance was later replaced by the Patents
(Amendment) Act 2005 on 4th April, 2005 which is in force now having effect from 1-1-2005
...
Accordingly, the
Patents Rules, 1972 were notified and brought into force w
...
f
...
4
...
These Rules were amended from
time to time till 20th May 2003 when new Patents Rules, 2003 were brought into force by replacing the 1972
rules
...
The last amendments are made effective from 5th May 2006
...
These forms are to be used wherever required and if needed,
they can be modified with the consent of the Controller
...
The Fourth Schedule prescribes costs to be awarded in various proceedings
before the Controller under the Act
...
Exclusivity
of right implies that no one else can make, use, manufacture or market the invention without the consent of
the patent holder
...
However, the use or exploitation of a
patent may be affected by other laws of the country which has awarded the patent
...
Further, existing patents in similar area may also
come in the way
...
As the right is conferred by the State, it can be revoked by the State under very special
circumstances even if the patent has been sold or licensed or manufactured or marketed in the meantime
...
A patent is an official document given to an inventor by the government allowing him to exclude anyone else
from commercially exploiting his invention for a limited period which is 20 years at present
...
Grant of exclusive privilege to own, use or sell the method or the product patented for a limited
period, stimulates new inventions of commercial utility
...
Hindustan Metal Industries, AIR1982 SC 1444]
...
In return for the exclusive right, the inventor
has to adequately disclose the patented invention to the public, so that others can gain the new knowledge
and can further develop the technology
...
Product/Process Patents
Section 5 of the Patent Act 1970 had provided for grant of only process patents in certain categories of
inventions
...
The Paris Convention has left this issue to be dealt with in
the States legislation in a manner of its own choice
...
1 stipulates that patents shall be available for any inventions,
whether products or processes in all fields of technology except for the exclusion stipulated under Article
27
...
3
...
Section 5 of the Patents Act,
1970 (as it stood after the 2002 amendments) provided that, in the case of inventions being claimed relating
to food, medicine, drugs or chemical substances, only patents relating to the methods or processes of
manufacture of such substances could be obtained
...
Subsequently, Section 5 of the Patents Act, 1970 was
deleted by the Patents (Amendment) Act, 2005 that came into force on 01
...
2005, thereby paving the way
for product patents
...
The Committee
found that foreigners held between eighty and ninety percent of Indian patents and that more than ninety
percent of these patents were not even worked in India
...
The Patents Act has been amended keeping in view the development of technological capability in India,
coupled with the need for integrating the intellectual property system with international practices and
intellectual property regimes
...
DURATION OF PATENTS
Section 53 provides that the term of every patent granted after the commencement of the Patents
(Amendment) Act, 2002 and the term of every patent which has not expired and has not ceased to have
effect, on the date of such commencement, shall be twenty years from the date of filing of application for the
patent
...
A patent shall cease to have effect on the expiration of the period prescribed for the payment of any renewal
fee, if that fee is not paid within the prescribed period or within such extended period as may be prescribed
...
Rule 80 requires that to keep a patent in force, the renewal fees specified in the First Schedule should be
paid at the expiration of the second year from the date of the patent or of any succeeding year and the same
should be remitted to the patent office before the expiration of the second or the succeeding year
...
While paying the renewal fee, the number and date of
the patent concerned and the year in respect of which the fee is paid is required to be quoted
...
An
invention is different from a discovery
...
Not all inventions are patentable
...
The word “invention” under the Patents Act 1970 means “a new product or process involving an
inventive step and capable of industrial application
...
The patent must be in respect of an invention and not a discovery
...
That is to say, it must have
novelty and utility
...
To be patentable the improvement or the
combination must produce a new result, or a new article or a better or cheaper article than before
...
e
...
In Raj Prakash v
...
1, it was held that invention, as is well known, is to
find out some thing or discover some thing not found or discovered by anyone before
...
The essential thing is that the inventor was first to adopt it
...
Therefore, the conditions of patentability are:
•
Novelty
•
Inventive step (non-obviousness) and
•
Industrial applicability (utility)
Novelty
A novel invention is one, which has not been disclosed, in the prior art where prior art means everything that
has been published, presented or otherwise disclosed to the public on the date of patent (The prior art
includes documents in foreign languages disclosed in any format in any country of the world
...
This
means that there should not be any prior disclosure of any information contained in the application for patent
(anywhere in the public domain, either written or in any other form, or in any language) before the date on
which the application is first filed i
...
the 'priority date'
...
Although the
term prior art has not been defined under the Indian Patents Act, it shall be determined by the provisions of
Section 13 read with the provisions of Sections 29 to 34
...
(b) An invention shall not be considered to be novel if it has been anticipated by publication made
before the date of filing of the application in any of the documents in any country
...
(d) An invention shall not be considered to be novel if it has been anticipated having regard to the
knowledge, oral or otherwise, available within any local or indigenous community in India or
elsewhere
...
Dhanpal Das Gupta, AIR1945 Oudh 6, it was held that no general rule can be
laid down as to what does or does not constitute an invention
...
But novelty need only be established in the process of manufacturing, not in the article
produced
...
In Ram Narain Kher v
...
A person claiming a patent has not only to allege the
improvement in art in the form but also that the improvement effected a new and very useful addition to the
existing state of knowledge
...
Inventive Step (Non-obviousness)
Inventive step is a feature of an invention that involves technical advance as compared to existing knowledge
or having economic significance or both, making the invention non obvious to a person skilled in art
...
An invention shall not be considered as involving an inventive step, if, having regard to the state of the art, it
is obvious to a person skilled in the art
...
e
...
For this purpose a “person skilled in the art” should be presumed to be an ordinary practitioner aware of what
was general common knowledge in the relevant art at the relevant date
...
Industrial Applicability
An invention is capable of industrial application if it satisfies three conditions, cumulatively:
•
can be made;
38
PP-IPRL&P
•
can be used in at least one field of activity;
•
can be reproduced with the same characteristics as many times as necessary
...
An invention to be patentable must be useful
...
2
...
3
...
4
...
5
...
6
...
NON PATENTABLE SUBJECT MATTER
An invention may satisfy the condition of novelty, inventiveness and usefulness but it may not qualify for a
patent
...
(e) a substance obtained by a mere admixture resulting only in the aggregation of the properties of the
components thereof or a process for producing such substance;
(f) the mere arrangement or re-arrangement or duplication of known devices each functioning
independently of one another in a known way;
(g) omitted by Patents (Amendment) Act, 2002
...
Section 4 prohibits the grant of patent in respect of an invention relating to atomic energy falling within Subsection (1) of Section 20 of the Atomic Energy Act, 1962
...
Under Section 20
(1) of the Atomic Energy Act, 1962 “no patents shall be granted for inventions which in the opinion of the
Central Government are useful for or relate to the production, control, use or disposal of atomic energy or the
prospecting, mining, extraction, production, physical and chemical treatment, fabrication, enrichment,
canning or use of any prescribed substance or radioactive substance or the ensuring of safety in atomic
energy operations”
...
As per Section 2(1)(y), “true and first Inventor” does not include either the first importer of an invention into
India or a person to whom an invention is first communicated from outside India
...
Assignee can be a natural person or other than natural person like registered company, research
organization, educational institute or Government (S
...
Assignee includes assignee of the assignee
also (S
...
‘Proof of right’ to apply such as assignment deed should be submitted by the assignee
...
2 (1)(k))
...
as proof of right
...
Form of Application
Section 7 dealing with form of application requires every application for a patent to be made for one invention
only
...
In respect of one single invention there must be one single patent
...
But it is not possible to bifurcate a patent and state that it relates to the substance
and the other to the process
...
[Imperial Chemical Industries Ltd
...
Controller General of Patents, designs
& Trade Mark & Another AIR 1978 Cal
...
]
Every international application under the Patent Cooperation Treaty (PCT) for a patent, as may be filed
designating India shall be deemed to be an application under the Act, if a corresponding application has also
been filed before Controller in India
...
Section 7(4) provides that every such application, not being a convention
application or an application filed under PCT designating India, shall be accompanied by a provisional or a
complete specification
...
Fortunately for
inventors several countries in 1970 decided to simplify the process for protecting patents around the world by
creating the Patent Cooperation Treaty (PCT)
...
Inventors may apply for a patent either in all the member countries of PCT or in selected
group of countries
...
Specification
In order to obtain a patent, an applicant must fully and particularly describe the invention therein claimed in a
complete specification
...
This is possible only when an applicant
discloses the invention fully and particularly including the best method of performing the invention
...
The Specification, thus, forms a crucial part of the Patent Application
...
The
Specification may be filed either as a provisional or as a complete specification
...
The first page of the
Form 2 shall contain:
(a) Title of the invention;
(b) Name, address and nationality of each of the applicants for the Patent; and
Lesson 2
Patents
41
(c) Preamble to the description
...
Every Specification
whether provisional or complete shall describe the invention
...
The Controller may also require the applicant to submit drawings, if necessary at the examination
stage [Section 9, 10
...
Form-1, 2]
...
The Controller may require the applicant to submit, anytime before the grant, models or
samples related to the invention for better illustration of the invention
...
Provisional Specification
When the applicant finds that his invention has reached a stage wherein it can be disclosed on paper, but
has not attained the final stage, he may prepare a disclosure of the invention in the form of a written
description and submit it to Patent Office as a provisional specification which describes the invention
...
Immediately on receiving the Provisional Specification the Patent Office accords a filing date and application
number to the Application
...
If two provisional specifications filed by an applicant are cognate or if one is a modification of the other, the
applicant may file one complete specification covering both the provisional applications
...
In such cases, date of filing of application is the date of filing of the earliest provisional
specification and shall bear the number of that application
...
Consequently, the applicant has to file a complete specification within twelve months from the date of first
filing
...
e
...
Complete Specification
The complete specification is a techno-legal document which fully and particularly describes the invention
and discloses the best method of performing the invention
...
Important Elements of the Complete Specification
As per Section 10, every complete specification is required to (a) fully and particularly describe the invention and its operation or use and the method by which it is to
be performed;
42
PP-IPRL&P
(b) disclose the best method of performing the invention which is known to the applicant and for which
he is entitled to claim protection; and
(c) end with a claim or claims defining the scope of the invention for which protection is claimed; and
(d) be accompanied by an abstract to provide technical information on the invention
...
However, the Controller may amend the abstract for providing better information to third parties and if the
applicant mentions a biological material in the specification which may not be described in such a way as to
satisfy clauses (a) and (b) above and if such material is not available to the public, the application shall be
completed by depositing the material to an International Depository Authority under the Budapest Treaty and
by fulfilling the following conditions, namely:
(i) the deposit of the material shall be made not later than the date of filing the patent application in
India and a reference thereof shall be made in the specification within the prescribed period;
(ii) all the available characteristics of the material required for it to be correctly identified or indicated
are included in the specification including the name, address of the depository institution and the
date and number of the deposit of the material at the institution;
(iii) access to the material is available in the depository institution only after the date of the application
for patent in India or if a priority is claimed after the date of the priority;
(iv) disclose the source and geographical origin of the biological material in the specification, when used
in an invention
...
In an infringement action, the function of the Court is to construe the claims which are alleged to have been
infringed, without reference to the body of the specification, and to refer to the body of the specification only if
there is any ambiguity or difficulty in the construction of the claims in question [Farbwerke Hoechst v
...
In case of an international application designating India the title, description, drawings, abstracts and claims
filed with the application shall be taken as the complete specification for the purposes of the Act
...
[Section 10(4)(a)]
Types of Patent Applications
1
...
e
...
2
...
3
...
4
...
5
...
[Section 7, 54,135]
Where to apply?
As per Rule 4 of the Patents Rules, 2003 [as amended by Patents (Amendment) Rules, 2005], application for
Lesson 2
Patents
43
the patent has to be filed in the respective patent office as mentioned below where the territorial jurisdiction
is decided based on whether any of the following occurrences falls within the territory
...
(c) Address for service in India given by the applicant when he has no place of business or domicile in
India
...
An applicant (Indian or foreigner) can also give his Patent Agent’s address as address for serving documents
if he/she wishes so
...
Territorial
jurisdiction of a patent office is decided based on the following:
(i) Place of residence, domicile or business of the applicant (first mentioned applicant in the case of
joint applicants)
...
(iii) Address for service in India given by the applicant, when the Applicant has no place of business or
domicile in India (Foreign applicants)
...
However, a provisional specification cannot be filed in case of a Convention Application (either directly or
through PCT routes)
...
If the specification exceeds thirty pages or claims are more than ten in
number, additional fee as given in First Schedule is payable
...
Contents of Patent Application
A patent application should contain:
1
...
2
...
The Proof of Right is
either an endorsement at the end of the Application Form-1 or a separate assignment
...
Provisional / complete specification in Form-2
...
Statement and undertaking under Section 8 in Form- 3, if applicable
...
5
...
However, the
Controller may allow Form-5 to be filed within one month from the date of filing of application, if a
request is made to the Controller in Form-4
...
Power of authority in Form-26, if filed through a Patent Agent
...
In case the original general power of authority has been filed in another jurisdiction, that fact
may also be mentioned in the self attested copy
7
...
(b) PCT National Phase Application wherein requirements of Rule 17
...
The priority document may be filed along with the application or before the expiry of eighteen
months from the date of priority, so as to enable publication of the application
...
8
...
9
...
The drawing sheets should bear the signature of an applicant or his agent in the right
hand bottom corner
...
If the Application pertains to a biological material obtained from India, the applicant is required to
submit the permission from the National Biodiversity Authority any time before the grant of the
patent
...
11
...
[Section 7
...
Also Section
6 of the Biological Diversity Act, 2002 & Rule 17
...
The Patent Office provides the facility to file a Patent Application online from the native place of the
agent of the applicant or applicant through e-filing
...
For e-filing, applicant/agent must have a digital signature
...
(Rule 6
...
ipindia
...
in
...
On receipt of an application, the Office accords a date and serial number to it
...
2
...
3
...
4
...
(b) Technical field of invention for allocation to an examiner in the respective field
...
Lesson 2
Patents
45
(d) Correcting/completing the abstract, if required
...
However, such amendments should
not result in a change in the nature of invention
...
Requests for examination are also accorded separate serial number
...
The Office checks whether the Application has been filed in appropriate jurisdiction
...
2
...
If the proof of right is not filed along with
the application, it shall be filed within a period of six months from the date of filing of the application
...
3
...
e
...
Further, the
Office checks whether:
(a) the documents are prepared on a proper sized paper, typed in appropriate font with proper
spacing,
(b) the documents are duly signed,
(c) abstract, drawings (if any) have been filed in proper format,
(d) meaningful Claim(s) are present in a complete specification,
(e) Power of Attorney or attested copy of General Power of Attorney (if any) is filed,
(f) Form-5 has been filed (along with complete after Provisional or for filing PCT-NP/Convention
Application),
(g) the invention has been assigned to another person and Form 6 has been duly filed
...
Secrecy directions and consequences thereof
1
...
2
...
3
...
The applicant may request for a
reconsideration of the secrecy direction and if the same is found reasonable by the Controller, he may
request the Central Government for a review
...
If the Central Government is of the opinion that an invention in respect of which the Controller has not
imposed a secrecy direction and is relevant for defence purposes, it may at any time before the grant of the
patent notify the Controller to that effect
...
5
...
[Section 35, 36, 37, 38]
46
PP-IPRL&P
Publication of Application
Section 11A(1) provides that no application for patents shall ordinarily be open to public for such period as
may be prescribed
...
The Controller on receipt of such request shall publish such
application in the Official Journal as soon as possible
...
Rule 24 dealing with procedure for publication of application provides that the period for which an application
for patent shall not ordinarily be open to public under Section 11A(1) shall be eighteen months from the date
of filing of application or the date of priority of the application, whichever is earlier
...
The publication of every application shall include the particulars of the date of application, number of
application, name and address of the applicant identifying the application and an abstract
...
The patent office may, on payment of prescribed fee make the
specification and drawings, if any, of such application available to the public
...
However, the applicant shall
have no right to institute any proceedings for infringement until the patent has been granted
...
Moreover, after the patent is granted in respect of applications made under Section 5(2), the patent holder
shall only be entitled to receive reasonable royalty from such enterprises which have made significant
investment and were producing and marketing concerned product prior to January 1, 2005 and which
continue to manufacture the product covered by the patent on the date of grant of the patent and no
infringement proceedings shall be instituted against such enterprises
...
As per Section 11B an application for a Patent will not be examined unless the applicant or any other
person interested makes a request for examination in the prescribed manner
...
2
...
If no such request for examination
is filed within the prescribed time limit, the application shall be treated as withdrawn by the applicant
...
In a case where secrecy direction has been issued under Section 35, the request for examination may be
made within six months from the date of revocation of the secrecy direction, or within forty-eight months from
the date of filing or priority, which ever is later
...
The Office will not examine an application unless it is published and a request for examination is filed
...
When a request for examination is filed by a person interested other than the applicant, the Examination
Lesson 2
Patents
47
Report is sent to the applicant only, and intimation is given to the person interested
...
Rule
24B]
Reference for Examination
1
...
2
...
At present, the Patent Office has four examination groups based on the broad area of
specialization viz
...
(b) Biotechnology, Microbiology and allied subjects
...
The reference to the Examiner is made ordinarily within one month from the date of publication or one month
from the date of request for examination, whichever is later, and is made in order in which the request is
filed
...
When an application is referred by the Controller, the Examiner makes a report on the patentabilility as
well as other matters ordinarily within one month but not exceeding three months from the date of such
reference
...
Rule 24B (2)(i)]
Examination of Application
Section 12 dealing with examination of application provides that when the request for examination has been
filed in respect of an application for a patent in the prescribed manner under Section 11B(1) or (3), the
application and specification and other documents related thereto shall be referred at the earliest by the
Controller to an examiner for making a report to him in respect of the following matters, namely:
(a) whether the application and the specification and other documents relating thereto are in
accordance with the requirements of the Act and of any rules made thereunder;
(b) whether there is any lawful ground of objection to the grant of the patent in pursuance of the
application;
(c) the result of investigations made under Section 13, and
(d) any other matter which may be prescribed
...
Search for Anticipation by Previous Publication and by Prior Claim
Section 13 dealing with search for anticipation by previous publication and by prior claim provides that the
examiner to whom the application for a patent is referred shall make investigation for the purpose of
ascertaining whether the invention so far as claimed in any claim of the complete specification:
(a) has been anticipated by publication before the date of filing of the applicant’s complete specification
in any specification filed in pursuance of an application for a patent made in India and dated on or
after the 1st day of January, 1912;
48
PP-IPRL&P
(b) is claimed in any claim of any other complete specification published on or after the date of filing of
the applicant’s complete specification, being a specification filed in pursuance of an application for a
patent made in India and dated before or claiming the priority date earlier than that date
...
In case a complete specification has been amended before the grant
of a patent, the amended specification shall be examined and investigated in the like manner as the original
specification
...
Power of Controller to Refuse or Require Amended Application in Certain matters
Section 15 empowers the Controller to refuse the application or direct to amend the application, specification
or other documents, if he is satisfied that the application or any specification or any other document filed in
pursuance thereof does not comply with the provisions of the Act and the rules made thereunder
...
However, no application shall
be post-dated to a date later than six months from the date on which it was actually made or would be
deemed to have been made
...
Where an application or specification (including drawings) or any other document is required to be amended
under Section 15, the application or specification or other document shall, if the Controller so directs, be
deemed to have been made on the date on which the requirement is complied with or where the application
or specification or other document is returned to the applicant, the date on which it is refiled after complying
with the requirement
...
If it appears to the Controller that the invention is claimed in a claim of any other complete specification, he
may, direct that a reference to that other specification be inserted in the applicant’s complete specification
unless the applicant shows to the satisfaction of the Controller that the priority date of his claim is not later
than the priority date of the claim of the said other specification; or the complete specification has been
amended to his satisfaction
...
The Controller of Patents is not technically a Court, or a tribunal exercising judicial functions in the legal
acceptation of the terms, but that does not make it untrue to say that, so far as he has a duty imposed
upon him to hear and determine objections to applications for leave to amend, there is a fair analogy
between his position and the position of a Court
...
Incorporated AIR 1934 Cal
...
Potential infringement
Section 19 provides that if in consequence of the investigations it appears to the Controller that an invention
in respect of which an application for a patent has been made cannot be performed without substantial risk of
infringement of a claim of any other patent, he may direct that a reference to that other patent, be inserted in
the applicant’s complete specification by way of notice to the public within such time as may be prescribed,
unless:
(a) the applicant shows to the satisfaction of the Controller that there are reasonable grounds for
contesting the validity of the said claim of the other patent; or
(b) the complete specification is amended to the satisfaction of the Controller
...
Substitution of Applicants etc
...
No such direction shall however, be given by virtue of any assignment or agreement made by
one of the two or more joint applicants for a patent except with the consent of the other joint applicant or
applicants
...
Where one of two or more joint applicants for a patent dies at any time before the patent has been granted,
the Controller may upon a request made by the survivor or survivors and with the consent of the legal
representative of the deceased direct that the application shall proceed in the name of the survivor or
survivors alone
...
Time for Putting Application in Order for Grant
Section 21 of the Act provides that an application for a patent shall be deemed to have been abandoned
unless, the applicant has complied within the prescribed period with all the requirements imposed on him by
or under the Act, whether in connection with the complete specification or otherwise in relation to the
application from the date on which the first statement of objections to the application or complete
specification or other documents related thereto is forwarded to the applicant by the Controller
...
Sub-section (2) of Section 21 provides that if at the expiration of the period as prescribed under sub-section (1)
an appeal to the High Court is pending in respect of the application for the patent for the main invention; or in
the case of an application for a patent of addition, an appeal to the High Court is pending in respect of either
that application or the application for the main invention, the time within which the requirements of the
Controller shall be complied with shall, on an application made by the applicant before the expiration of the
period as prescribed under sub-section (1), be extended until such date as the High Court may determine
...
However, in case of an appeal filed during the said further period, and the High Court has granted
any extension of time for complying with the requirements of the Controller, then the requirements may be
complied with within the time granted by the High Court
...
The grounds of the opposition are:
(a) that the applicant for the patent or the person under or through whom he claims, wrongfully obtained
the invention or any part thereof from him or from a person under or through whom he claims;
(b) that the invention so far as claimed in any claim of the complete specification has been published
before the priority date of the claim (i) in any specification filed in pursuance of an application for a patent made in India on or after the 1st
day of January, 1912; or
(ii) in India or elsewhere, in any other document :
Provided that the ground specified in sub-clause (ii) shall not be available where such publication
does not constitute an anticipation of the invention by virtue of sub-section (2) or sub-section (3) of
section 29;
(c) that the invention so far as claimed in any claim of the complete specification is claimed in a claim of
a complete specification published on or after the priority date of the applicant’s claim and filed in
pursuance of an application for a patent in India, being a claim of which the priority date is earlier
than that of the applicant’s claim;
(d) that the invention so far as claimed in any claim of the complete specification was publicly known or
publicly used in India before the priority date of that claim
...
Section 25(2) entitles any interested person to give notice of opposition, to the Controller in the prescribed
manner at any time after the grant of patent but before the expiry of a period of one year from the date of
52
PP-IPRL&P
publication of grant of a patent, on any of the following grounds only :(a) that the patentee or the person under or through whom he claims, wrongfully obtained the invention
or any part thereof from him or from a person under or through whom he claims;
(b) that the invention so far as claimed in any claim of the complete specification has been published
before the priority date of the claim in any specification filed in pursuance of an application for a
patent made in India on or after the 1st day of January, 1912; or in India or elsewhere, in any other
document
...
Explanation to clause (d) of Section 25(3) clarifies that an invention relating to a process for which a
patent is granted shall be deemed to have been publicly known or publicly used in India before the
priority date of the claim if a product made by that process had already been imported into India
before that date except where such importation has been for the purpose of reasonable trial or
experiment only
...
Opposition Proceedings
Rule 55 dealing with opposition by representation against the grant of patent requires the representation for
opposition under section 25(1) to be filed at the appropriate office within a period not exceeding three months
Lesson 2
Patents
53
from the date of publication of the application under section 11A of the Act, or before the grant of patent,
whichever is later and include a statement and evidence, if any, in support of the representation and a
request for hearing if so desired
...
On consideration of the representation if the Controller is of the opinion that application for patent shall be
refused or the complete specification requires amendment, he shall give a notice to the applicant to that
effect
...
On consideration of the statement and evidence filed by the applicant, the Controller may either refuse to
grant a patent on the application or require the complete specification to be amended to his satisfaction
before the patent is granted
...
Rule 55A dealing with filing of notice of opposition provides that the notice of opposition to be given under
section 25(3) shall be made in Form 7 and sent to the Controller in duplicate at the appropriate office
...
Constitution of Opposition Board and its Proceeding
Section 25(3) provides that where any such notice of opposition is duly given under sub-section (2), the
Controller shall notify the patentee and constitute a Board by order in writing to be known as the Opposition
Board consisting of such officers as he may determine and refer such notice of opposition alongwith the
documents to that Board for examination and submission of its recommendation
...
Sub-section (4) provides that
the Controller shall, on receipt of the recommendation of the Opposition Board and after giving the patentee
and the opponent an opportunity of being heard, order either to maintain or amend or revoke the patent
...
In case the Controller issues an order under sub-section (4) that the patent shall be maintained subject to
amendment of the specification or any other document, the patent shall stand amended accordingly
...
An
examiner appointed under section 73(2) shall be eligible to be a member of the Opposition Board
...
The Opposition Board shall conduct the examination of the notice of opposition along with documents filed
under rules 57 to 60 referred to under section 25(4), submit a report with reasons on each ground taken in
the notice of opposition with its joint recommendation within three months from the date on which the
documents were forwarded to them
...
Where an opponent has, before the date of the order of the Controller requiring the amendment of a
complete specification referred to in section 26(1)(b), filed an application for a patent for an invention which
included the whole or a part of the invention held to have been obtained from him and such application is
pending, the Controller may treat such application and specification in so far as they relate to the invention
held to have been obtained from him, as having been filed, for the purposes of the priority dates of claims of
the complete specification, on the date on which the corresponding document was or deemed to have been
filed by the patentee in the earlier application but for all other purposes the application of the opponent shall
be proceeded with as an application for a patent
...
The Controller has been put under obligation to publish the
fact that the patent has been granted and thereupon the application, specification and other documents
related thereto shall be open for public inspection
...
TERM OF PATENT
Section 53 provides that the term of every patent granted after the commencement of the Patents
(Amendment) Act, 2002 and the term of every patent which has not expired and has not ceased to have
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55
effect, on the date of such commencement, shall be twenty years from the date of filing of application for the
patent
...
A patent shall cease to have effect on the expiration of the period prescribed for the payment of any renewal
fee, if that fee is not paid within the prescribed period or within such extended period as may be prescribed
...
Rule 80 requires that to keep a patent in force, the renewal fees specified in the First Schedule should be
paid at the expiration of the second year from the date of the patent or of any succeeding year and the same
should be remitted to the patent office before the expiration of the second or the succeeding year
...
While paying the renewal fee, the number and date of
the patent concerned and the year in respect of which the fee is paid is required to be quoted
...
PATENTS OF ADDITION
Sections 54, 55 and 56 deal with patents of addition
...
Where an invention being an improvement in or modification of another invention, is the subject of an
independent patent and the patentee in respect of that patent is also the patentee in respect of the patent for
the main invention, the Controller may, if the patentee so requests, revoke the patent for the improvement or
modification and grant to the patentee a patent of addition in respect thereof, bearing the same date of the
patent so revoked
...
A patent of addition shall not be granted before the grant of the patent for the main invention
...
No renewal
fees is payable in respect of a patent of addition, but if any such patent becomes an independent patent the
same fees shall thereafter be payable upon the same dates, as if the patent had been originally granted as
an independent patent
...
In this context, it is clarified that in determining the novelty of the
invention claimed in the complete specification filed in pursuance of an application for a patent of addition
regard shall be had also to the complete specification in which the main invention is described
...
Procedure for Disposal of Applications for Restoration of Lapsed Patents
Section 61 provides that if, after hearing the applicant in cases where the applicant so desires or the
Controller thinks fit, the Controller is prima facie satisfied that the failure to pay the renewal fee was
unintentional and that there has been no undue delay in the making of the application, he shall publish the
application in the prescribed manner; and within the prescribed period, any person interested may give
notice to the Controller of opposition thereto on either or both of the following grounds that —
(a) the failure to pay the renewal fee was not unintentional; or
(b) there has been undue delay in the making of the application
...
If no notice of
opposition is given within the prescribed period aforesaid or if in the case of opposition, the decision of the
Controller is in favour of the applicant, the Controller shall, upon payment of any unpaid renewal fee and
such additional fee as may be prescribed, restore the patent and any patent of addition specified in the
application which has ceased to have effect on the cesser of that patent
...
Rights of Patentees of Lapsed Patents which have been Restored
...
No
suit or other proceeding shall be commenced or prosecuted in respect of an infringement of a patent
committed between the date on which the patent ceased to have effect and the date of the publication of the
application for restoration of the patent
...
Where the Controller is satisfied that a prima facie case for the restoration of any patent has not been made
out, he shall intimate the applicant accordingly and unless the applicant makes a request to be heard in the
matter within one month from the date of such intimation, the Controller shall refuse the application
...
Rule 85 provides the procedure for opposition to restoration under section 61 and says that at any time,
within two months from the date of publication of the application under sub-rule (3) of rule 84, any person
interested may give notice of opposition thereto in Form 14
...
The procedure specified in rules 57 to 63 relating to the filing of written
statement, reply statement, leaving evidence, hearing and costs shall, so far as may be, apply to the hearing
of the opposition under section 60 as they apply to the hearing in the opposition proceeding
...
The Controller has been put under obligation to publish his decision
...
Where such an offer is made, the Controller shall publish the offer in the prescribed manner and also notify
every person other than the patentee whose name appears in the register as having an interest in the patent
...
If the Controller is
satisfied after hearing the patentee and any opponent, if desirous of being heard, that the patent may
properly be surrendered, he may accept the offer and by order revoke the patent
...
Section 64 dealing with revocation of patents
stipulates that a patent, whether granted before or after the commencement of this Act, may, be revoked on
a petition of any person interested or of the Central Government by this Appellate Board or on a counterclaim in a suit for infringement of the patent by the High Court on any of the following grounds namely:
(a) that the invention, so far as claimed in any claim of the complete specification, was claimed in a
valid claim of earlier priority date contained in the complete specification of another patent granted
in India;
(b) that the patent was granted on the application of a person not entitled under the provisions of this
Act to apply therefore;
(c) that the patent was granted on the application of a person not rights of the petitioner or any person
under or through whom he claims;
(d) that the subject of any claim of the complete specification is not an invention within the meaning of
this Act;
(e) that the invention so far as claimed in any claim of the complete specification is not new, having
regard to what was publicly known or publicly used in India before the priority date of the claim or to
what was published in India or elsewhere in any of the documents referred to in section 13:
(f) that the invention so far as claimed in any claim of the complete specification is obvious or does not
involve any inventive step having regard to what was publicly known or publicly used in India or
what was published in India or elsewhere before the priority date of the claim:
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(g) that the invention, so far as claimed in any claim of the complete specification, is not useful;
(h) that the complete specification does not sufficiently and fairly describe the invention and the method
by which it is to be performed, that is to say, that the description of the method or the instructions for
the working of the invention as contained in the complete specification are not by themselves
sufficient to enable a person in India possessing average skill in, and average knowledge of, the art
to which the invention relates, to work the invention, or that it does not disclose the best method of
performing it which was known to the applicant for the patent and for which he was entitled to claim
protection;
(i) that the scope of any claim of the complete specification is not sufficiently and clearly defined or that
any claim of the complete specification is not fairly based on the matter disclosed in the
specification;
(j) that the patent was obtained on a false suggestion or representation;
(k) that the subject of any claim of the complete specification is not patentable under this Act;
(l) that the invention so far as claimed in any claim of the complete specification was secretly used in
India, otherwise than as mentioned in sub-section (3), before the priority date of the claim;
(m) that the applicant for the patent has failed to disclose to the Controller the information required by
section 8 or has furnished information which in any material particular was false to his knowledge;
(n) that the applicant contravened any direction for secrecy passed under Section 35 or made or
caused to be made an application for the grant of a patent outside India in contravention of Section
39
(o) that leave to amend the complete specification under section 57 or section 58 was obtained by
fraud;
(p) that the complete specification does not disclose or wrongly mentions the source and geographical
origin of biological material used for the invention;
(q) that the invention so far as claimed in any claim of the complete specification was anticipated
having regard to the knowledge, oral or otherwise, available within any local or indigenous
community in India or elsewhere
...
Section 64 (3) provides that for the purpose of clause (l) of sub-section (1), no account shall be taken of any
use of the invention (a) for the purpose of reasonable trial or experiment only; or
(b) by the Government or by any person authorised by the Government or by a Government
undertaking, in consequence of the applicant for the patent or any person from whom he derives
title having communicated or disclosed the invention directly or indirectly to the Government or
person authorized as aforesaid or to the Government undertaking; or
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59
(c) by any other person, in consequence of the applicant for the patent or any person from whom he
derives title having communicated or disclosed the invention, and without the consent or
acquiescence of the applicant or of any person from whom he derives title
...
A notice of any petition for revocation of a patent under this section shall be served on all persons appearing
from the register to be proprietors of that patent or to have shares or interests therein and it shall not be
necessary to serve a notice on any other person
...
As per section 66 of the Patents Act where the Central Government is of opinion that a patent or the mode
in which it is exercised is mischievous to the State or generally prejudicial to the public, it may, after giving
the patentee an opportunity to be heard, make a declaration to that effect in the Official Gazette and
thereupon the patent shall be deemed to be revoked
...
According to section 85 of the Patents Act where, in
respect of a patent, a compulsory licence has been granted, the Central Government or any person
interested may, after the expiration of two years from the date of the order granting the first compulsory
licence, apply to the Controller for an order revoking the patent on the ground that the patented invention has
not been worked in the territory of India or that reasonable requirements of the public with respect to the
patented invention has not been satisfied or that the patented invention is not available to the public at a
reasonably affordable price
...
Section 65 as amended by Patents (Amendment) Act, 2005
provides that where at any time after grant of a patent, the Central Government is satisfied that a patent is for
an invention relating to atomic energy for which no patent can be granted under sub-section (1) of section 20
of the Atomic Energy Act, 1962, it may direct the Controller to revoke the patent, and thereupon the
Controller, after giving notice, to the patentee and every other person whose name has been entered in the
register as having an interest in the patent, and after giving them an opportunity of being heard, may revoke
the patent
...
Under Rule 87 of the Patents Rules, 1970 the Controller is required to publish the notice of an offer given
under section 63
...
The procedure specified in rules 57 to 63
relating to the filing of written statement, reply statement, leaving evidence, hearing and costs shall, so far as
may be, apply to the hearing of the opposition under section 63 as they apply to the hearing in opposition
proceeding
...
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ASSIGNMENTS OF PATENTS
Assignment refers to the act of the patentee by which the patent rights are wholly or partially transferred to
the assignee who acquires the right to prevent others from making, using or exercising or vending the
invention
...
The assignment can either be exclusive or non exclusive
...
Following are three main types of assignments in
patents:
Legal Assignments
An assignment of an existing deed is a legal assignment
...
A legal assignee is entitled to be registered as the proprietor of the patent and acquires
all the rights thereof
...
This affects proprietorship, but does not directly change it
...
Mortgages
A mortgage is a document through which patent rights are transferred to the assignee in return for a sum of
money
...
The term assignee as per
Section 2(1) of the Patents Act, 1970 includes in its meaning the legal representative of a deceased
assignee
...
As per Section 68 of the Patents Act, 1970
an assignment to be valid shall be in writing, to be contained in a document that embodies all terms and
conditions governing their rights and obligations and the application for registration of such document is filed
in the prescribed manner with the Controller within six months from the commencement of the Act or the
execution of the document, whichever is later
...
WORKING OF PATENTED INVENTIONS – GENERAL PRINCIPLES
Section 83 dealing with general principles applicable to working of patented invention provides that in
exercising the powers conferred for working of patents and compulsory licences, regard shall be had to the
following general considerations, namely:
(a) that patents are granted to encourage inventions and to secure that the inventions are worked in
India on a commercial scale and to the fullest extent that is reasonably practicable without undue
delay;
(b) that they are not granted merely to enable patentees to enjoy a monopoly for the importation of the
patented article;
(c) that the protection and enforcement of patent rights contribute to the promotion of technological
innovation and to the transfer and dissemination of technology, to the mutual advantage of
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61
producers and users of technological knowledge and in a manner conducive to social and economic
welfare, and to a balance of rights and obligations;
(d) that patents granted do not impede protection of public health and nutrition and should act as
instrument to promote public interest specially in sectors of vital importance for socio-economic and
technological development of India;
(e) that patents granted do not in any way prohibit Central Government in taking measures to protect
public health;
(f) that the patent right is not abused by the patentee or person deriving title or interest on patent from
the patentee, and the patentee or a person deriving title or interest on patent from the patentee
does not resort to practices which unreasonably restrain trade or adversely affect the international
transfer of technology; and
(g) that patents are granted to make the benefit of the patented invention available at reasonably
affordable prices to the public
...
According to Section 84 any
person interested can make an application for grant of compulsory license for a patent after three years from
the date of grant of that patent on any of the following grounds –
(a) that the reasonable requirements of the public with respect to the patented invention have not been
satisfied, or
(b) that the patented invention is not available to the public at a reasonably affordable price, or
(c) that the patented invention is not worked in the territory of India
...
Sub-section (3) requires every application for compulsory licence to contain a statement setting out the
nature of the applicant’s interest together with such particulars as may be prescribed and the facts upon
which the application is based
...
In considering the application of compulsory licence, the Controller is required to take into account —
(i) the nature of the invention, the time which has elapsed since the sealing of the patent and the
measures already taken by the patentee or any licencee to make full use of the invention;
(ii) the ability of the applicant to work the invention to the public advantage;
(iii) the capacity of the applicant to undertake the risk in providing capital and working the invention, if
the application were granted;
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(iv) as to whether the applicant has made efforts to obtain a licence from the patentee on reasonable
terms and conditions and such efforts have not been successful within a reasonable period as the
Controller may deem fit
...
It has been clarified that the reasonable period shall be construed as a period not ordinarily
exceeding a period of six months
...
REVOCATION OF PATENTS BY THE CONTROLLER FOR NON-WORKING
As stated earlier, Section 85 deals with revocation of patents by Controller for not working and provides that
where, in respect of a patent, a compulsory licence has been granted, the Central Government or any person
interested may, after the expiration of two years from the date of the order granting the first compulsory
licence, apply to the Controller for an order revoking the patent on the ground that the patented invention has
not been worked in the territory of India or reasonable requirements of the public with respect to the patented
invention has not been satisfied or the patented invention is not available to the public at a reasonably
affordable price
...
The Controller, if satisfied that the reasonable requirements of the public
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63
with respect to the patented invention has not been satisfied or patented invention has not been worked in
the territory of India or is not available to the public at a reasonably affordable price, may make an order
revoking the patent
...
Procedure for Dealing with Applications
Section 87 provides that where the Controller is satisfied, upon consideration of an application for
compulsory licence or revocation of patent, that a prima facie case has been made out for the making of an
order, he shall direct the applicant to serve copies of the application upon the patentee and any other person
appearing from the register to be interested in the patent in respect of which the application is made, and
shall publish the application in the Official Journal
...
Any
such notice of opposition should contain a statement setting out the grounds on which the application is
opposed
...
Powers of Controller in Granting Compulsory Licences
Section 88 provides that where the Controller is satisfied that the manufacture, use or sale of materials not
protected by the patent is prejudiced by reason of conditions imposed by the patentee upon the grant of
licences under the patent, or upon the purchase, hire or use of the patented article or process, he may order
the grant of licences under the patent to such customers of the applicant as he thinks fit as well as to the
applicant
...
Where two or more patents are held by the same patentee and an applicant for a compulsory licence
establishes that the reasonable requirements of the public have not been satisfied with respect to some only
of the said patents, then, if the Controller is satisfied that the applicant cannot efficiently or satisfactorily work
the licence granted to him under those patents without infringing the other patents held by the patentee and if
those patents involve important technical advancement or considerable economic significance in relation to
the other patents, he may, by order, direct the grant of a licence in respect of the other patents also to enable
the licencee to work the patent or patents in regard to which a licence is granted
...
However no such
application shall be entertained a second time by the Controller
...
(viii) in the case of semi-conductor technology, the licence granted is to work the invention for public noncommercial use
...
Section 90(2) provides that no licence granted by the Controller shall authorise the licencee to import the
patented article or an article or substance made by a patented process from abroad where such importation
would, but for such authorisation, constitute an infringement of the rights of the patentee
...
Licensing of Related Patents
Section 91 provides that at any time after the sealing of a patent, any person who has the right to work any
other patented invention either as patentee or as licencee thereof, exclusive or otherwise, may apply to the
Controller for the grant of a licence of the first mentioned patent on the ground that he is prevented or
hindered without such licence from working the other invention efficiently or to the best advantage possible
...
When the Controller is satisfied that the conditions mentioned in Section 91(1) have been established by the
applicant, he may make an order granting a licence under the first mentioned patent and a similar order
under the other patent if so requested by the proprietor of the first mentioned patent or his licencee
...
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65
Compulsory Licences on Notifications by Central Government
Section 92 provides that if the Central Government is satisfied, in respect of any patent in force in
circumstances of national emergency or in circumstances of extreme urgency or in case of public noncommercial use, that it is necessary that compulsory licences should be granted at any time after the sealing
thereof to work the invention, it may make a declaration to that effect, by notification in the Official Gazette,
and thereupon the Controller shall on application made at any time, after the notification, by any person
interested, grant to the applicant a licence under the patent on such terms and conditions as he thinks fit
...
Compulsory Licensing of Patents Relating to the Manufacture of Pharmaceutical Products
for Export to Countries with Public Health Problems
Section 92A of the Patents Act, 1970 inserted by The Patents (Amendment) Act, 2005 postulates
compulsory licence for export of patented pharmaceutical products in certain exceptional circumstances
...
Sub-section (2) authorises the Controller, on receipt of an application in the prescribed manner, to grant, on
such terms and conditions as he may specify, a compulsory licence solely for manufacture and export of the
concerned pharmaceutical product to such country under such terms and conditions as may be specified and
published by him
...
Termination of Compulsory Licence
Section 94 provides that on an application made by the patentee or any other person deriving title or interest
in the patent, a compulsory licence may be terminated by the controller, provided the circumstances that give
rise to the grant thereof no longer exist and such circumstances are unlikely to recur
...
PROCEDURE IN RESPECT OF COMPULSORY LICENCE, ETC
...
Rule 96 provides that an
application to the Controller for an order under section 84, section 85, section 91 or section 92 or section 92A
shall be in Form 17, or Form 19, as the case may be
...
Rule 97 provides that if, upon consideration of the
evidence, the Controller is satisfied that a prima facie case has not been made out for the making of an order
under any of the sections referred to above, he shall notify the applicant accordingly, and unless the
applicant requests to be heard in the matter, within one month from the date of such notification, the
Controller shall refuse the application
...
Notice of Opposition under Section 87(2)
Rule 98 requires that a notice of opposition under section 87(2) should be given in Form 14 and be sent to
the Controller within two months from the date of the publication of the application
...
The opponent is required to
serve a copy of notice of opposition and evidence on the applicant and notify the Controller when such
service has been effected
...
Rule 98(5) requires the Controller to fix a date and time for hearing of the case and give the parties not less
than ten days’ notice of such hearing
...
Rule 99 requires the Controller to publish the order made by him under section 85(3)
revoking a patent
...
In case the
Controller is satisfied that a prima facie case has not been made out for the revision of the terms and
conditions of the licence, he may notify the applicant accordingly and unless within a month the applicant
requests to be heard in the matter, the Controller may refuse the application
...
Application for Termination of Compulsory Licence under Section 94
Rule 102 requires that an application for termination of compulsory licence under section 94(1) should be
made in Form 21 along with the evidence by the patentee or any other person deriving title or interest in the
patent
...
The holder
of the compulsory licence may file his objection alongwith evidence, if any, to the application within one
month from the date of receipt of the application and evidence by him to the Controller and serve a copy
thereof to the applicant
...
On completion of the above proceedings, the Controller is required to fix a date and the time for the hearing
of the case and give the parties not less than ten day’s notice of such hearing
...
If the Controller decides to terminate the compulsory
licence he shall issue an order giving terms and conditions, if any, of such termination and serve copies of
the order to both the parties
...
The head office of the patent office shall be the appropriate office for dealing with the
International Bureau of the World Intellectual Property Organisation, International Searching Authorities and
International Preliminary Examining Authorities
...
The appropriate office shall on receipt of an international
application, transmit one copy as record copy of such application to International Bureau of the World
Intellectual Property Organisation and another copy as search copy to Competent International Searching
Authority
...
It may be pointed out that Section 39 expressly states that an Indian applicant cannot apply for patents
outside India except under the authority of a written permit sought in the prescribed manner and granted by
or on behalf of the Controller
...
In such cases, it is advisable that the
application be accompanied by permission for foreign filing granted under section 39 by the
Controller
...
(b) Filing directly in the International Bureau of WIPO after taking permission u/s 39 from the Indian
Patent Office
...
However, if
the international filing is within 6 weeks from the date of filing in India, such filing shall be made after
taking permission u/s 39 from the Indian Patent Office
...
The fees payable in respect of an international application filed with the
appropriate office shall be, in addition to the fees as specified in the regulations under the Treaty, the fees as
specified in the First Schedule to the Patents Rules, 2003
...
The appropriate office shall, on receipt of a request from the applicant and on payment of the prescribed fee
by him, prepare a certified copy of the priority document and promptly transmit the same to the International
Bureau of the World Intellectual Property Organisation for the purpose of an international application filed
with the appropriate office with an intimation to the applicant and the head office
...
However, the Patent office shall not commence processing of
an application filed corresponding to international application designating India before the expiration of the
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time limit of thirty one months from the priority date
...
An applicant in respect of an international application designating India shall, before the prescribed period
pay the prescribed national fee and other fees to the patent office in the prescribed manner; and where the
international application was either not filed or has not been published in English, file with the patent office, a
translation of the application in English, duly verified by the applicant or the person duly authorized by him
that the contents thereof are correct and complete
...
If the applicant fails to file a translation of the amended claims and annexures as above, even after invitation
from the appropriate office to do so, within a time limit as may be fixed by that office having regard to the
time left for meeting the requirements, the amended claims and annexures shall be disregarded in the
course of further processing the application by the appropriate office
...
Filing of Priority Document
Rule 21 provides that where the applicant in respect of an international application designating India has not
complied with the requirements of paragraph (a) or paragraph (b) of rule 17
...
Where priority document is not in the English language, an English
translation thereof duly verified by the applicant or the person duly authorized by him shall be filed within the
specified time limit
...
PATENT AGENTS
The work relating to drafting of specifications, making of application for a patent, subsequent
correspondence with the Patent office on the objections raised, representing the applicants case at the
hearings, filing opposition and defending application against opposition is entrusted to a qualified Patent
Agent
...
The Controller maintains a register to be called the ‘register of patent agents’ in which there will be entered
the names, address and other relevant particular as may be prescribed of all persons qualified to have their
names so entered according to section 126
...
The register will contain the name, nationality address of the
principal place of business, branch office address and other relevant particular as may be prescribed, if any,
the qualification and the date of registration of entry as Patent agent
...
However, a person who has been registered as a patent agent before the commencement of Patent
(Amendment) Act, 2005 will be entitled to continue to be, or when required to be re-registered as a patent
agent, on payment of the fee
...
As per clause (c)(ii) of sub section 1 of section
126 there is a provision for conducting the qualifying examination for Patent agents, which will consist of a
written test and a viva voce examination
...
e
...
The qualifying marks for written paper & for the viva voice examination is fifty per cent each, and a
candidate shall be declared to have passed the examination only if he obtains an aggregate of sixty percent
of the qualifying marks (Rule 110 (3))
Registration of Patent Agents
As per Rule 111, after a candidate passes the qualifying examination specified in rule 110 and after obtaining
any further information, which the Controller considers necessary, and on receipt of the fee will enter the
candidate’s name in the register of patent agents and issue to him a certificate of registration as a patent
agent
...
The following details will be entered in the register:
(a) Name and qualification,
(b) Address of his/her office including branch office, if any
(c) Date of payment of prescribed fee
(d) Other details as may be necessary
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Disqualification for Registration as a Patent Agent
Rule 114 provides for conditions for disqualification of a person from registration as Patent Agent
...
(iii) Being a discharged insolvent, has obtained from the court a certificate to the effect that his
insolvency was caused by misfortune without any misconduct on his part;
(iv) Has been convicted by a competent court, whether within or outside India of an offence to undergo
a term of imprisonment, unless the offence of which he has been convicted has been pardoned or
unless on an application made by him, the Central Government has, by order in this behalf,
removed the disability;
(v) Being a legal practitioner has been guilty of professional misconduct; or
(vi) Being a chartered accountant has been guilty of negligence or misconduct
...
The name can be maintained in the register by paying the
renewal fee every year
...
in the Register of Patent Agents
As per Rule 118 a Patent agent may apply for the alteration of his name, address of the principal place of
business and branch offices, if any, or the qualifications entered in the register of patent agents
...
Every alteration made in the register of
patent agents will be published
...
It will be also published in Annual Report of the Controller General of Patents,
Designs and Trade Marks
...
His work also includes
drafting of specification, making an applicat ion for Patent, making subsequent Correspondence with the
Patent Office, attending hearing on behalf of the applicant, filing and taking part in opposition proceeding or
defending his case against such opposition filed by some other Party
...
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LESSON ROUND UP
•
A patent is an official document given to an inventor by the government allowing him to exclude anyone
else from commercially exploiting his invention for a limited period which is 20 years at present
...
•
Not all inventions are patentable
...
The conditions of patentability are: novelty, inventive step (non-obviousness) and, industrial
applicability (utility)
...
•
Application for a patent for an invention may be made (a) by any person claiming to be the true and first
inventor of the invention;(b) by any person being the assignee of the person claiming to be the true and first
inventor in respect of the right to make such an application;(c)by the legal representative of any deceased
person who immediately before his death was entitled to make such an application
...
Where the application is made by virtue
of an assignment of the right to apply for a patent for the invention, there shall be furnished with the
application proof of the right to make the application
...
The disclosure of the invention in a complete specification must be such that a
person skilled in the art may be able to perform the invention
...
•
Where an application for a patent has been published but a patent has not been granted, any person may,
in writing, represent by way of opposition to the Controller against the grant of patent on the grounds
stipulated therein, and the Controller on request of such person shall hear him and dispose of the
representation in the prescribed manner and specified time
...
•
If an application for a patent has been found to be in order for grant of the patent and is not found to be in
contravention of any of the provisions of the Act, the patent shall be granted as expeditiously as possible to
the applicant
•
The work relating to drafting of specifications, making of application for a patent, subsequent
correspondence with the Patent Office on the objections raised, representing the applicant’s case at the
hearings, filing opposition and defending application against opposition, is entrusted to a qualified Patent
Agent
...
What is a patent? Explain the elements of patentability?
2
...
Discuss
...
Discuss in detail the provisions of the Patents Act in relation to compulsory licences
...
Explain in detail the provisions relating to patent in addition
...
Enumerate the important elements of the complete specification
...
Discuss the grounds on which the registration of a patent can be refused?
7
...
8
...
The Office of the Controller
General of Patents, Designs & Trade Marks
(CGPDTM) is responsible for the administration of
Patents Act, 1970, Designs Act, 2000, The Trade
Marks Act, 1999 and Geographical Indications of
Goods (Registration and Protection) Act, 1999
through its Intellectual Property Offices located at
Mumbai, Delhi, Kolkata, Chennai and Ahmedabad
...
When developing a new product,
comparative
technological
information
may
determine the success or failure of the product and,
in turn, the success or failure of the company itself
...
A patent search is a
search conducted in patent databases as well as in
the literature available to check whether any
invention similar to inventor’s invention already
exists
...
A number of commercial and non-profit
providers also offer free patent information
databases online
...
74
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INTRODUCTION
Intellectual Property Rights (IPR) are considered to be the backbone of any economy and their creation and
protection is essential for sustained growth of a nation
...
Accordingly, the Intellectual Property Office in India is dedicated to
mobilize the use of such technological advancement for socio-economic development, which is a
constitutional mandate, by creating the requisite IP culture
...
Of late, the office of the
Controller General has also been known as Intellectual Property Office (IPO)
...
The Office of the Controller General of Patents, Designs & Trade Marks (CGPDTM) is located at Mumbai
...
The Trade Marks registry is at Mumbai and its branches are located in Kolkata, Chennai,
Ahmedabad and New Delhi
...
A Geographical
Indications Registry has been established in Chennai to administer the Geographical Indications of Goods
(Registration and Protection) Act, 1999 under the CGPDTM
...
Mr
...
H
...
Mr Chaitanaya Prasad has
assumed charge as CGPDTM recently
...
PIS maintains a comprehensive
collection of patent specifications and patent related literature on a worldwide basis to meet the need for
technological information of various users in R&D establishments, Government Organizations, Industries,
Business, Inventors and other users enabling them to take informed business decisions
...
The institute will also facilitate research on IP related issues including preparation of study
reports and policy analysis of relevance to Government
...
Lesson 3
Patent Databases & Patent Information System
75
The updated laws, highlights of various functions and other useful information are available on
(http://www
...
nic
...
PATENT INFORMATION
Traditionally, patent information searches are done, if at all, as a part of the application drafting process
before filing patent applications, or while planning and preparing for patent litigation
...
In recent years, economists, social science researchers, policymakers, businessmen and professionals have
begun to make increasing meso-level and macro-level use of patent information
...
As such, the use of patent
information has expanded to many different tactical and strategic business, research, and policy making
activities at national, institutional or enterprise levels
...
It is the largest, well-classified and most up-to-date collection of technical documents on new and
innovative technologies
...
An
applicant may be a public and private company, government agency, researcher in a university or in a
research and development institution, or even individual inventors
...
REASONS FOR USING PATENT INFORMATION
Patent information is more than just technological or legal information
...
Some of the practical applications of patent information include:
Tool for Creative Thinking
Patent information provides a source of technological information that can be used by researchers and
inventors to find new solutions to technical problems
...
Based on the study and analysis of a set of worldwide patent documents, Genrich Altshuller and
his colleagues developed the TRIZ methodology
...
The TRIZ research has proceeded in several stages and more than 2 million patent documents have been
examined, classified by level of inventiveness and analyzed to look for principles of innovation
...
Large and small companies, including many Fortune 500 companies are using TRIZ on many levels to solve
real and practical problems and to develop strategies for the future of technology
...
Patent information, therefore, provides an extremely useful source of information for learning and developing
creative problem solving and innovation strategies
...
If the technology in question is valuable enough, it
will generally be protected by a patent because of the intrinsic insecurity and difficulty of keeping it as a trade
secret
...
Before entering into licensing negotiations, it is most
important that the parties have a very good understanding of the target technology itself, its value, in terms of
its strengths and weaknesses, which is aided considerably by a thorough and careful analysis of relevant
patent information
...
Similarly, while preparing to ‘license out’ your technology, analyze patent information to consider:
•
who could be prospective licensees in the marketplace;
•
how valuable is your technology in order to prepare an attractive offer; and
•
whether it is a core technology in your business, which if licensed out might become an obstacle to
continue to practice this technology, etc
...
Payment(s), if any, in a cross-licensing agreement is/are made by the party,
which is perceived to have a patent portfolio of lesser value
...
If Company X argues that its portfolio is more valuable than that of Company Y, it may require
Company Y to fill the gap in the form of one time or recurring payments
...
Supporting Mergers and Acquisitions (M&A)
If a company wishes to acquire a specific technology along with other complimentary assets and has no idea
from where to obtain it, then it first needs to identify all the companies with relevant patents and related assets
...
Once one or more potential
target technologies/companies are identified, then the company can undertake additional patent analysis to
narrow down its choices to decide which of the companies is the best merger or acquisition target
...
As part of a broad
strategic plan to fill gaps in a company’s technology base, a large high-tech company acquired a small
specialty business
...
Its technological capability was dependent on
one key researcher and he did not come along as part of the deal
...
If patent analysis had been done before proceeding with the acquisition, the
company would have been able to find out that who the key researcher is and then could have taken
appropriate measures to retain him
...
Patent analysis
makes it possible to find out the flow of technology from elementary technologies along with the expansion of
those technologies, the trend of technological change, the life cycle of a technology (consisting of growth,
development, maturity and decline), problems and solutions in the development of a particular technology,
competitors’ technologies and solutions to cope with possible problems
...
It can also prevent an infringement from occurring, which would save a huge amount in litigation
expenses and compensation for damages
...
If one company has more patents than another does, then this suggests that the company has a stronger
commitment to R&D
...
A few patents are for radical inventions
that change the world; most patents are granted for incremental but non-obvious inventions
...
From links between patents revealed by patent citation analysis, it is possible to target the
acquisition of strong patents, which results in the enhancement of R&D output and, consequently, much
improved or new products
...
Patent analysis, such as a co-inventor brain map, can show the key inventors who are vitally important for
the future of the company
...
PATENT SEARCH & PATENT DATABASES
An important step before filing a patent application is to conduct a patent search
...
A patent search is a search conducted in patent databases as
well as in the literature available, to check whether any invention similar to the invention in respect of which
patent is to be obtained, already exists
...
Therefore, instead of going forth with the filing, if one conducts the patentability search, one can get a
clear idea about the patentability of the invention; whether the application should be filed and the strengths
and weakness of his invention
...
Although there is an additional expense associated to have a patent search performed, it can
potentially save the inventor’s money down the road
...
Each database covers a
particular set of patent documents
...
Thus, it may be necessary to consult multiple databases in order to find and then
access patent documents relevant to your interests
...
CD-ROM
databases are very convenient for documentary searches
...
CD-ROM databases, however, have some drawbacks
...
As on-line
databases can be easily updated on a regular basis, the information on CD-ROM rapidly becomes out of
date, at least for certain types of analysis
...
On-line Databases
Internet-based databases are on-line databases
...
As access to these kinds of databases is not restricted across national borders, so users worldwide can very
easily access patent documents from a computer connected to the Internet
...
For example, the Full-Text and FullPage Image Database of the United States Patent and Trademark Office (USPTO) is one of the earliest and
free online patent information services
...
Espacenet offers free access to more than 80 million patent
documents worldwide, containing information about inventions and technical developments from 1836 to
today
...
wipo
...
html
WIPO offers free online access to all international patent applications within the framework of the PCT and
their related documents and patent collections from National and Regional Offices through its
PATENTSCOPE search service: (http://patentscope
...
int/search)
International Patent Classification (IPC) is a hierarchical classification system used primarily to classify and
search patent documents (patent applications, specifications of granted patents, utility models, etc
...
It therefore serves as an instrument for an orderly arrangement
of the patent documents, a basis for selective dissemination of information and a basis for investigating the
state of the art in given fields of technology
...
The
database contains:
•
United States patents (US): 1971-present & updated weekly
...
•
European patents - applications (EP-A): 1979-present, updated weekly
...
•
European patents - issued (EP-B): 1980-present, updated weekly
...
(Front page & claims / full images)
•
Patent Abstracts of Japan (JP): 1976-present, updated weekly
...
Certain
commercial providers have established value-added services for access on a fee-paying basis including
translations of patent information and additional systematic classification, for instance by chemical structures
and reactions or biological sequences
...
An extensive list of patent
service providers can be found at: (www
...
org/vendors
...
The reason being, patent
searches involves tedious, repeated searching through various patent and non-patent literature
...
Furthermore, a skilled
person understands the importance of the claims of a patent
...
Furthermore, a skilled person would be able to
counsel on the strength of your patent or on refining your patent so that it does not infringe other existing art
...
VARIOUS TYPES OF SEARCHES USING PATENT DOCUMENTATION
In practice, there are various more or less typical reasons for performing searches in collections of patent
documents, each of them requiring a slightly different approach in the search method used
...
The
individual types of searches are listed herein below separately, whereas it is a well-known fact that many
items of bibliographic information may be combined in searching
...
However, such insights into patent documents are often very useful for the
inventor to determine whether someone has already patented a similar invention, or to obtain relevant
information about other patents in the same category as his invention
...
Many details are not even known or recognized as relevant parts
...
The patent
application process is difficult, time consuming and expensive; therefore, the inventor should conduct a "PreApplication Search" (PAS) before filling a patent application
...
State-of-the-Art Searches
This kind of search, also referred to as "Informative Search," is made to determine the general state-of-theart for the solution of a given technical problem as background information for R&D activities and in order to
know what patent publications already exist in the field of the technology or research
...
State-of-the-art searches are especially useful for technology development or
technology transfer purposes
...
The aim of the search is to discover relevant prior art
...
Normally, the basic inventive ideas are formulated in such an unspecified way that many publications will
apply to this broad description
...
If nothing of relevance was found, it is easy and
you should go ahead
...
Most important is to restrict the search to the appropriate area
...
Patentability or Validity Searches
A "Patentability or Validity Search" is made to locate documents relevant to the determination not only of
Lesson 3
Patent Databases & Patent Information System
81
novelty but also of other criteria of patentability, for example, the presence or absence of an inventive step
(i
...
, the alleged invention is or is not obvious) or the achievement of useful results or technical progress
...
Novelty and patentability searches are mainly being carried out by industrial property offices in the
course of the examination of patent applications
...
Technological Activity Searches
They are to be understood as searches for identifying companies and/or inventors who are active in a
specific field of technology
...
Infringement Searches
The objective of an "Infringement Search" is to locate patents and published patent applications, which might
be infringed on by a given industrial activity
...
Patent Family Searches
This kind of search is carried out to identify a member of a "patent family
...
Legal Status Searches
A search for this type of investigation is made to obtain information on the validity (status) of a patent or a
published patent application, on a given date, under the applicable patent legislation in one or more
countries
...
It can also give guidance on the value attached to a particular patent by the patentee
...
•
The Office of the Controller General of Patents, Designs & Trade Marks (CGPDTM) comes under the
Department of Industrial Policy and Promotion, Ministry of Commerce and Industry
...
82
PP-IPRL&P
•
The Patent information System (PIS) and National Institute of Intellectual Property Management (NIIPM)
located at Nagpur also come under the superintendence of CGPDTM
...
•
A patent document contains in a standardized form, a wealth of information about the state-of-the-art,
adjudged in the international context, in technological developments in that area of technology
...
•
A patent search is a search conducted in patent databases as well as in the literature available to check
whether any invention similar to your invention already exists
...
Each database covers a particular set of patent documents
...
•
A number of commercial and non-profit providers also offer free patent information databases online
...
SELF TEST QUESTIONS
These are meant for re-capitulation only
...
1
...
2
...
3
...
4
...
5
...
Lesson 4
PREPRATION OF PATENT DOCUMENTS
LESSON OUTLINE
LEARNING OBJECTIVES
A laboratory notebook is an important tool that goes
well beyond research management and can have
•
Introduction
•
Laboratory Notebooks
•
Methods of Invention Disclosures
important implications for issues ranging from
intellectual property management to the prevention
•
Patent Application and its Contents
•
Writing of the Patent Document
of fraud
...
Therefore,
•
Lesson Round Up
it is important to keep and maintain records that
help establish who is first to invent a particular
•
Self Test Questions
invention
...
There is no specific format as to how to prepare a
patent document
...
The students must know the importance of keeping
the laboratory notebooks, how the disclosure of
invention is to be made in the patent application
and how to draft a patent application
...
Laboratory notebooks (also called a journal,
inventor's notebook or log book) is used by inventors, scientists and engineers to record their invention
process, experimental tests, ideas and results and observations
...
An interference proceeding, also known as a priority contest is an inter-party proceeding to
determine the priority issues of multiple patent applications
...
A patent grants its owner(s) the right to sue those who manufacture and market products or services that
infringe on the claims declared in the patent
...
Therefore, it is important to keep and maintain records that help establish who is first to
invent a particular invention
...
S
...
So a laboratory notebook is essential evidence of the date of
conception
...
When properly kept, the notebook is a valuable tool for the inventor since it provides a chronological record
of an invention and its reduction to practice
...
The witness
should not be someone with a conflict of interest (such as a research partner)
...
Methods of Invention Disclosure
As already discussed, an invention is patentable if it meets three pre-requisites of patentability, namely
novelty, inventive step, and capable of industrial applicability
...
The disclosure must be sufficient to enable an average skilled person to
perform the invention
...
Although, a patent application accompanied with provisional specification does not confer any
legal patent rights to the applicants, it is, however, a very important document to establish the earliest
ownership of an invention
...
No patent is granted on the basis of a provisional
specification
...
* Under US Patent Law, the reduction to practice is a concept meaning the embodiment of the concept of an invention
...
This period
can be extended by 3 months
...
An application with complete specification can be filed right at the first instance
...
The contents of a complete
specification would include the following:
(1) Title of the invention
...
(3) Background of the invention including prior art giving drawbacks of the known inventions &
practices
...
(5) Drawings etc
...
(6) Claims, which are statements, related to the invention on which legal proprietorship is being sought
...
[A detailed discussion on Specification has been given in Study Lesson -2 on Patents
...
Accordingly, a patent application is in many ways like a contract
...
In this sense, drafting a patent application is different from writing a
scientific paper
...
The issued patent will be reviewed over the years by public
officials such as patent examiners and judges and business partners
...
The parts of the patent application typically include the Background, Summary, Detailed Description and
Drawings, Claims and Abstract
...
The drafting of patent application must be made in full and strict compliance with the patent law of the
concerned jurisdiction
...
86
PP-IPRL&P
Writing of Patent Document
There is no specific format as to how to prepare a patent document
...
The patent professional assists the applicant by drafting the disclosure and claims,
and preparing any necessary forms etc
...
Under Part III of the said Manual, patent application preparation and
filing has been discussed in detail
...
Preparing Patent Applications
The first question a patent agent needs to have answered upon receiving a request to prepare a patent
application is: how soon does this application need to be filed?
The World’s patent laws all have strict requirements regarding when an application must be filed with respect
to various events
...
The patent agent needs to know:
(1) Where does my client want to protect his invention?
(2) Has something already happened that would impair the client’s ability to protect the invention in the
desired countries?
(3) How soon does the client intend to do something that would jeopardize his ability to protect the
invention in the desired countries?
Even if the patent agent has no time obstacles in his way, he should endeavor to complete the patent
application as quickly as possible, as would be expected of any professional
...
Also, prior art might become available (e
...
an article might be published) that
couldn’t have been used against the client’s application if the application had been filed earlier
...
After filing the application, you create a file for the provisional patent application, containing a copy of
everything you sent to the patent office including all the forms and copies of any checks for fee payment
...
Thus, if the
patent office does not provide your patent application with the proper date of receipt, you have everything
you will need to provide the proper filing date to the patent office – a date that is absolutely crucial in
preserving your client’s rights to obtain patent protection
...
Patent agents must strive to protect their client’s patent rights and sometimes protecting the applicant’s rights
involves simply making sure that critical dates are observed
...
Finally, the patent agent must try to understand early if the applicant wants to file in foreign countries
...
The filing of a PCT application also operates
within the one-year time frame of the Paris Convention
...
Even when the
applicant has initially indicated no interest in foreign filing he may change his mind in a year
...
The patent agent should also determine if
the applicant is interested in obtaining protection in a non-Paris Convention country before filing the priority
application
...
Non-Paris Convention countries can have very unique rules
for inbound foreign applications
...
A patent agent will likely not be allowed directly to represent his client before foreign patent offices
...
There are several models for interacting with foreign
associate attorneys
...
The patent agent who filed
the original priority application makes all the major decisions
...
The patent
agent may use different models for different foreign associate attorneys, e
...
“hands on” in some countries,
and “hands off” in others
...
1 of the TRIPS Agreement requires its signatories who are not Paris Convention signatories to
honor certain provisions of the Paris Convention such as the one-year period for claiming priority
...
1
...
Some clients may have fairly sophisticated administrative units that can provide
completed invention disclosure packages to patent agents who then conduct a follow-up review as
necessary
...
The patent agent will learn over time which approach offers the best results for different types of clients
...
For other clients the patent agent may want/need to obtain all his
information about the invention via one or more interviews with the inventor(s)
...
It is
highly unlikely that an inventor will be able to supply a patent agent with enough material for the patent agent
to have an unambiguous understanding of the invention without some sort of “live” meeting with the inventor
...
In an ideal situation, the inventor will provide the patent agent with an Invention Disclosure Form and
supporting documents well before the face-to-face meeting between them
...
During the meeting between the patent agent and the inventor, the patent agent verifies
that he has a complete understanding of the invention, establishes that there is no additional disclosure
information that he should also receive (or that he receives the additional disclosure material), determines
the most commercially-significant aspects of the invention and confirms that there are either no pending bar
dates or verifies the precise bar dates
...
This will
ensure that the patent agent will have had sufficient time to identify all the parts of the invention disclosure
that raise questions – both technical parts (e
...
“how does A function with B”?) and legal parts (e
...
“Who
else could be an inventor?”)
...
Much of the text in an invention disclosure and/or discussions
during the meeting with the inventor will probably not be about a purely patentable novelty but will include
other non-patentable technical details
...
” Thus, the patent agent will often be the one who articulates what constitutes a
patentable invention
...
Understanding the Invention
The patent agent should never become the inventor but should strive to have the clearest grasp of the
invention needed to obtain a patent with the broadest claims allowed by law
...
In other words, the patent agent must understand the invention well enough to know what
elements do not need to be recited in the broadest possible claim for the invention
...
Understanding the invention also means that the patent agent can receive a prior
art description such as one used as the basis for a claim rejection by a patent office and be able to explain
the differences between the invention and the prior art and/or amend the pending claims to highlight these
differences in a manner that minimizes the reduction in the scope of claim coverage
...
The inventor
may be able to speculate about alternatives and in some instances may even have the time to conduct some
additional research
...
Thus, if the inventor is uncertain about the answer to any of the patent agent’s
questions, the patent agent must use his best professional judgment as to how to deal with the uncertainty
...
The
patent agent may assist the inventor in considering possible alternative embodiments for the invention
...
TYPICAL PARTS OF THE PATENT APPLICATION
Once a patent agent understands the invention he can begin preparing the patent application
...
This title should broadly describe
the invention
...
Occasionally a patent examiner will decide that a
title is not descriptive of the invention
...
A patent application as filed should also include the names of the inventors
...
g
...
The patent application itself should also include all priority information,
such as the identification of related applications
...
The patent agent may have other forms to complete that
also provide the inventor’s name and priority information but there is more certainty when this information is
also included as part of the application itself
...
The key audiences include judges and
patent examiners
...
Other potential audiences include
competitors, infringers and investors
...
1
...
In fact, the patent agent may even want
to sketch out the claims in the disclosure meeting with the inventor
...
The patent agent may wish to use some sort of “picture
claim” in the initial meeting with the inventor since inventors are often unfamiliar with patent claim language
...
The majority of patent agents prepare several draft patent claims as their first step in writing a patent
application
...
If the claims are prepared before drafting the specification the patent agent will know which terms
need to be described in the specification
...
This is because after writing the specification, the patent agent will likely come to an even
better understanding of the invention
...
Similarly, after
preparing the specification the patent agent may now see that the claims do not describe the invention as
accurately as they could
...
2
...
90
PP-IPRL&P
In some jurisdictions the term “specification” is also used to refer to the description in addition to the
summary and background sections of the application; suffice to say that “detailed description” and
“specification” are generally the same for purposes of patent drafting
...
This section cannot be substantively
amended once the application has been filed
...
The patent agent
cannot amend his application to include new technical disclosure during prosecution
...
The patent agent must use his best judgment to balance his concerns about being under-inclusive in the
specification section against including too much unclaimed subject matter in the application
...
Subject matter that is dedicated to the public is not patentable
...
If necessary, the patent agent can include the claims for any previously
unclaimed invention in either a divisional or continuation application as appropriate
...
As a
general rule, the patent agent should consult his client on every substantive matter pertaining to the client’s
pending patent application
...
The patent agent will also want to consider the “best mode” requirement
that arises in jurisdictions such as the US and India
...
In drafting the specification, the patent agent should avoid using phrases such as “the invention is…” The
patent agent should instead use phrases like “in an embodiment of the invention
...
Without limiting words to the contrary, the detailed
description section is generally presumed to disclose “an embodiment” of the invention rather than the
invention itself
...
The patent agent need not include in the patent application well-known material that would be needed in
order to make a product associated with the invention
...
A patent specification filed in the US, for example, must satisfy the three requirements of enablement, written
description and best mode
...
The “Enablement” requirement means that a patent application must teach ordinary persons skilled in the art
how to make and use the invention
...
A patent application that is not enabled as of its filing date cannot become enabled by later
technical innovations
...
The patent agent’s
language choices will be important not only during patent prosecution but especially if/when the patent is
litigated
...
Thus, the patent agent will want to make sure that if a patent application uses words like “must” and
“always,” these words very precisely and accurately express the situation at hand
...
Many patent laws and rules are available online
...
3
...
In fact, many
patent agents would argue that the drawings are the most important part of the patent application after the
claims
...
Where possible, the
drawings should explain the invention in sufficient detail that reading the detailed description section merely
confirms in words the information provided in the drawings
...
In
preparing the drawings the patent agent should think of the story he wants to tell and how he wants to tell it
...
The elements shown in a patent’s drawings are typically accompanied by a short description in words and a
reference number such as “clock 102
...
The patent agent should use a consistent numbering scheme for the
reference numbers
...
The drawing section should begin with a statement indicating
that the drawings are illustrative of one or more embodiments of the invention (and not illustrative of THE
invention)
...
Background
The use of background sections varies among the world’s patent regimes
...
This is the situation in most European systems
...
The background section is typically considered prior art disclosed by the inventor
...
Some patent offices take a fairly hard line about inventive
disclosures in background sections, which is one of the reasons why patent agents should draft them
carefully
...
The background section could describe the prior art at a very
92
PP-IPRL&P
high level
...
5
...
The patent agent
could use a version of the first paragraph of the summary of the invention section as the abstract
...
Summary
As noted earlier, not all jurisdictions require a summary of the invention section
...
The patent agent
may find himself reviewing summary sections drafted by foreign patent agents working on his client’s foreign
counterpart patent applications
...
Some patent agents prepare the summary of the invention section by taking each of the independent claims
in the patent application and turning them into paragraphs
...
Many patent agents simply
draft the summary of the invention section in a manner that highlights the important aspects of the invention
using words drawn from the application’s claims
...
In preparing the summary of the invention sections, avoid providing some sort of “big picture”
summary that goes beyond the claims in any manner
...
It is not a legal document but is of great value, if
properly organized and maintained, since it can help establish dates of conception and reduction to
practice
...
Therefore, it is important
to keep and maintain records that help establish who is first to invent a particular invention
...
•
Writing a high-quality patent application is important because it sets out in a clear fashion the terms by
which the patent owner and others will be bound
...
•
The parts of the patent application typically include the Background, Summary, Detailed Description and
Drawings, Claims and Abstract
...
professionally prepared
...
Answers to these questions are not to be submitted for
evaluation
...
What is a Laboratory Notebook? How is it significant in patent litigation?
2
...
Explain the statement
...
The patent agent should never become the inventor but should strive to have the clearest grasp of
the invention needed to obtain a patent with the broadest claims allowed by law
...
4
...
When patent
infringement happens, the patentee may sue for
•
Defenses to Infringement
•
Legal Aspects
relief in the appropriate court
...
invention within India, or importing into India of any
patented invention during the term of a patent
...
It
is important for the students to understand the legal
aspects governing infringement, exceptions and
defenses to infringement and the remedies
available to the patent holder in the event of
infringement
...
As discussed earlier,
patent rights are the exclusive rights granted by the Government to an inventor over his invention for a
limited period of time
...
Sections 104-114 of the
Patents Act, 1970 provide guidelines relating to patent infringement
...
However, the following acts when committed without the consent of the
patentee shall amount to infringement:
(i) making, using, offering for sale, selling, importing the patented product;
(ii) using the patented process, or using, offering for sale, selling or importing the product directly
obtained by that process
There are three basic types of patent infringements:
(a) Direct Infringement
Direct patent infringement is the most obvious and the most common form of patent infringement
...
(b) Indirect Infringement and contributory infringement
Indirect patent infringement suggests that there was some amount of deceit or accidental patent infringement
in the incident
...
B is supplied with a product from another person C to facilitate
manufacturing of the B’s device
...
Further, if such a product is knowingly sold or supplied, it may lead to
“contributory infringement”
...
Exclusions from infringement
The law however enumerates certain exceptions to infringement:
(a) Experimental and Research: Any patented article or process can be used for the following purposes:
•
Experiment
•
Research
•
Instructing the pupils
It is also permitted to make, construct, use, sell or import a patented invention solely for the uses reasonably
related to the development and submission of information required under any law for the time being in force,
in India, or in a country other than India, that regulates the manufacture, construction, use, sale or import of
any product
...
Lesson 5
Patent Infringement
97
(b) Parallel Importation under certain conditions: Patented article or article made by using the patented
process can be imported by government for its own use
...
Moreover the government can import any patented medicine or drug for
the purposes of its own use or for distribution in any dispensary, hospital or other medical institution
maintained by the government or any other dispensary, hospital or medical institution notified by the
government
...
Before dealing with jurisdiction, it may be pointed out that the courts in India receive (a) Patent
Administrative Cases and (b) Patent Infringement Cases
...
These types of cases include, dispute on grant of a patent, patent invalidation and
upholding, and compulsory licensing
...
These cases include, infringement of
patent, disputes relating to ownership of patent, disputes regarding patent rights or right for application,
patent contractual disputes, contractual disputes of assignment of patent right, patent licensing, and dispute
relating to the revocation of patents
...
Further, if the defendant files a counter-claim against revocation of the patent,
then the suit, along with the counter-claim, shall be transferred to the High Court for decision
...
Like any other civil suit the jurisdiction shall be determined in accordance with the rules of Code of Civil
Procedure
...
Period of Limitation: The period of limitation for instituting a suit for patent infringement is there years from
the date of infringement
...
However, TRIPS-prompted amendment inserted by way of Section 104 (A) has ‘reversed burden of proof’ in
case of infringement of patented process
...
[Section 104 (A)]
While considering whether a party has discharged the burden imposed upon him under Section 104(A), the
court shall not require him to disclose any manufacturing or commercial secrets, if it appears to the court that
it would be unreasonable to do so
...
The term "literal infringement" means that each and every element recited in a claim
has identical correspondence in the allegedly infringing device or process
...
The doctrine of equivalents is a legal
rule in most of the world's patent systems that allows a Court to hold a party liable for patent infringement
even though the infringing device or process does not fall within the literal scope of a patent claim, but
nevertheless is equivalent to the claimed invention
...
Instead, the scope of coverage which is afforded the patent owner is limited by (i) the doctrine of
"prosecution history estoppel" and (ii) the prior art
...
The steps in
the analysis are:
•
Construe the scope of the "literal" language of the claims
...
•
If there is no literal infringement, construe the scope of the claims under the doctrine of equivalents
...
However, there are
limits on the scope of equivalents to which the patent owner is entitled
...
In Lektophone Corporation v
...
S
...
According to the patent application, size and dimensions of
the invention were the essence of the patent
...
The manufacturer's devise also had a
central paper cone, but the cone was smaller than that of the patented devise and that constituted colorable
alteration
...
Declaration as to Non-Infringement
Under Section 105 of the Act, any person after the grant of publication of patent may institute a suit for a
declaration as to non-infringement
...
It is not necessary that the plaintiff must anticipate an infringement suit
...
These include:
(a) any act of making, constructing, using, selling or importing a patented invention solely for uses
reasonably related to the development and submission of information required under any law in
India or in any other country that regulates the making, constructing, using, selling or importing any
product
...
[Section 107-A]
It is possible to import the patented products from the licensee of the patentee in any country with out the
permission of the patentee
...
Reliefs in Suits for Infringement
As stated earlier, the exclusive rights of a patent holder have been provided protection under the Patents
Act, 1970 and in the event of any violation of these rights the patentee can file a suit in the appropriate court
...
As per Section 108 of the Patents
Act, the reliefs which may be awarded in such a suit include –
(1) An injunction
...
As is evident the reliefs granted under Section 108 of the Patents Act are inclusive and not exhaustive
...
Injunctions are two types- (i) temporary and (ii) permanent
...
It is governed by
Sections 38 to 42 of the Specific Relief Act, 1963
...
It is regulated by the provisions of Order 39 of the Code of Civil
Procedure and it may be granted at any stage of the suit
...
e
...
e
...
In the case of patent infringement, the plaintiff can obtain interlocutory order in the form of temporary
injunction from the court by proving the existence of the following facts:
(a) A prima facie case of infringement
(b) Balance of convenience is tilting in his/her favour
(c) If injunction is not granted he/she shall suffer irreparable damage
In Hindustan Lever Limited v
...
Where the alleged infringement is not novel and the patent has not yet been
exploited there is no question of loss of employment or fall in revenue and the damages if suffered could be
provisionally quantified
...
The Courts may refuse to consider the question of validity while deciding on interlocutory order
...
Telemecanique & Controls (I) Ltd
...
On the other hand in Novartis AG and Anr v
...
The power to grant temporary injunction is at the discretion of the court
...
In a number of landmark patent litigation cases the courts have displayed a varied approach in deciding on
interim injunction
...
v
...
, 2008 (36) PTC 417
(Mad
...
Amar Singh Chawalwala that matters relating to trademarks, copyrights and
patents should be finally decided very expeditiously by the trial court instead of merely granting or refusing to
grant injunction
...
Hoffmann-La Roche Ltd
...
v
...
In this case, the plaintiffs filed a suit praying for permanent injunction restraining defendant
from infringing its patent in respect of anti-cancer drug "Tarceva"
...
The Court in this case laid down several crucial principles as follows:
(i) In patent infringement actions, the courts should follow the approach indicated in American
Cyanamid case, by applying all factors;
(ii) The courts should follow a rule of caution, and not always presume that patents are valid, especially
if the defendant challenges it; and
(iii) The standard applicable for a defendant challenging the patent is whether it is a genuine one, as
opposed to a vexatious defense
...
The court was of the opinion that as between the two competing public interests, i
...
the public interest in
granting an injunction to the patentee, as opposed to the public interest in access to a life saving drug for the
people, the balance has to be tilted in favor of the latter
...
Aggrieved by the decision of the single judge, Roche went in appeal
...
It was also held that Roche failed to make a full
disclosure of the facts
...
The court however,
Lesson 5
Patent Infringement 101
restrained Cipla from exporting its drug to countries where Roche had a patent during the pendency of the
appeal
Damages and Accounts for Profits
Once the suit is decided in favour of the plaintiff, the court can either award damages or direct the defendant
to render an account of profits
...
Some express
limitations have been imposed on the grant of this relief
...
(b) Where an amendment of a specification had been allowed after the publication of the specification,
and the infringement action is in respect of the specification before the date of publication unless the
court is satisfied that original specification was made in good faith and with reasonable skill and
knowledge
...
The Supreme Court of India has laid down the following guidelines to determine infringement of a patent
based on Biswanath Prasad Radhey Shyam v
...
AIR SC 1978
...
Anton Pillar Order
The court can also order for the search of the premises of the defendant
...
[Section 108(2)]
Groundless Threats of Infringement Proceedings
There may be situations where a person makes groundless threats of infringement of patent
...
[Section 106]
102 PP-IPRL&P
Right of Exclusive Licensee to Take Proceedings Against Infringement
Exclusive licensee is a legal person who has been granted a license or a permission to use patent to the
exclusion of all others, including the patentee
...
In awarding damages or an account of profits or granting any other relief in any such suit, the court shall take
into consideration any loss suffered or likely to be suffered by the exclusive licensee or, the profits earned by
means of the infringement so far as it constitutes an infringement of the rights of the exclusive licensee as
such
...
[Section 109]
Defenses etc
...
(2) In any suit for infringement of a patent by the making, using or importation of any machine,
apparatus or other article or by the using of any process or by the importation, use or distribution
of any medicine or drug, it shall be a ground for defense that such making, using, importation or
distribution is in accordance with any one or more of the conditions specified in Section 47
...
v
...
Ltd
...
Every ground on which a patent could be revoked under Section 64 was available as a ground of
defense
...
INTELLECTUAL PROPERTY APPELLATE BOARD
Pursuant to the amendments introduced to the Patents Act, 1970 in 2002, a specialized forum called
Intellectual Property Appellate Board ("IPAB") has been constituted by the Central Government on
September 15, 2003 to hear and adjudicate appeals against the decisions of the Registrar under the Trade
Marks Act, 1999 and the Geographical Indications of Goods (Registration and Protection) Act, 1999
...
Now the IPAB has since April 2, 2007 been extended to Patent law and is now authorized to
hear and adjudicate upon appeals from most of the decisions, orders or directions made by the Controller of
Patents
...
The IPAB has its headquarters at Chennai and has sittings at Chennai, Mumbai, Delhi, Kolkata and
Ahmedabad
...
Lesson 5
Patent Infringement 103
The IPAB has appellate jurisdiction against the decision of the Controller or Central Government of India in
matters specified under Section 117A of the Patents Act, 1970
...
An order of the Controller granting an extension of time under any provision of the Patent Act 1970 is also
not appealable
...
All the cases
pertaining to revocation of patent, other than a counter-claim in a suit for infringement, and rectification of
register pending before the Indian High Courts shall be transferred to the IPAB
...
The IPAB also has exclusive jurisdiction on matters related to revocation of patent and rectification of
register
...
LESSON ROUND UP
•
Patent infringement means the violation of the exclusive rights of the patent holder
...
However, the following acts when committed without the consent of the patentee shall amount to
infringement
...
However, there are certain exceptions to infringement :(i) experimental and
research; and (ii) parallel importation under certain conditions
...
The period of limitation for instituting a suit for patent infringement is there years from the date
of infringement
...
However,
TRIPS-prompted amendment inserted by way of Section 104 (A) has ‘reversed burden of proof’ in case of
infringement of patented process
...
The
reliefs which may be awarded in such a suit include: (i) an injunction; (ii) damages or account of profits
...
The IPAB has since April 2, 2007 been extended to Patent law
...
Answers to these questions are not to be submitted for
evaluation
...
What does patent infringement mean and what acts of an infringer shall amount to infringement?
2
...
3
...
4
...
What are the reliefs that can be claimed by a patentee in the event of patent infringement?
Lesson 6
RECENT DEVELOPMENTS IN
PATENT SYSTEM
LESSON OUTLINE
•
Software and Business Method Patenting
in India
•
Software Patenting in other Jurisdictions
•
Patentable Inventions in Biotechnology
•
Lesson Round Up
•
Self Test Questions
LEARNING OBJECTIVES
With the rapid advancement in science and
technology, newer forms of intellectual property
protection are emerging
...
Patent laws of several countries favour patent
protection for software innovation
...
However, many other countries which include
India and European nations, have more stringent
laws concerning patent protection to software
innovation
...
Biotechnology has been at the core of a number of
important developments in the pharmaceutical,
agrochemical, energy and environmental sectors
...
The objective of the study lesson is to provide an
understanding to the students about the patenting
of software in India as well as the patenting of
inventions in the domain of biotechnology
...
Without software, a computer cannot operate
...
So, it is no wonder that intellectual
property protection of software is crucial not only for the software industry, but for other businesses as well
...
The
Foundation for a Free Information Infrastructure (FFII) has defined a software patent as being a "patent on
any performance of a computer realised by means of a computer program
...
There is intense debate over the extent to which software patents should be granted, if at all
...
The Foundation for a Free Information Infrastructure or FFII is a non-profit organisation based in Munich,
Germany, dedicated to establishing a free market in information technology, by the removal of barriers to
competition
...
An early example of a software patent is that of United Kingdom
...
The invention was concerned with efficient memory management for the simplex algorithm, and could
be implemented by purely software means
...
Most countries place some limits on the patenting of invention involving software, but there is no legal
definition of a software patent
...
S
...
In Europe, "computer programs as such" are excluded from
patentability and European Patent Office policy is consequently that a program for a computer is not
patentable if it does not have the potential to cause a "further technical effect" beyond the inherent technical
interactions between hardware and software
...
Patent laws of several countries favour patent protection for software innovation
...
However, many other countries, which include India and
European nations, have more stringent laws concerning patent protection to software innovation
...
Beginning with the landmark decision of US Supreme Court in Diamond v
...
S
...
Subsequently in 1982, a new Court called United States Court of Appeals for the Federal Circuit (CAFC) was
created by the U
...
Congress to hear patent cases
...
This requirement can be discerned from the variously phrased
prohibitions against the patenting of abstract ideas, laws of nature or natural phenomena”
...
Though the
European Parliament rejected the Computer Implemented Inventions Directive in July 2005, the position with
regard to software patenting remains more or less the same in EU member states
...
Current case law in the UK states that an (alleged) invention will only be
actually regarded as an invention if it provides a contribution that is not excluded and which is also technical
...
In Japan, software-related inventions are patentable
...
In 1999, the allowance rate for business method patents at the Japan Patent Office (JPO) reached an alltime high of roughly 35 percent
...
Since 2006, the average grant rate for business method patents has risen to the current rate of
roughly 25 percent
...
In Australia, pure or abstract methods of doing business are not
considered to be patentable, but if the method is implemented using a computer, it avoids the exclusion for
business methods
...
In South Africa, "a
program for a Computer" is excluded from recognition as a patentable invention by Section 25 of the Patents
Act
...
Indian Patent Act offers patent protection to products or processes (if they satisfy various requirements of
patentability) as long as they do not fall under non-patentable subject matter
...
The Indian Patent Law does not contain any specific provision regarding the protection of computer
software
...
A computer program is therefore dealt with a literary work and the law and practice in
relation to literary works will apply to computer programs
...
]
The Indian Patent Act, as of now, excludes only ‘computer programs per se’ from patentability
...
An attempt was
made through the Patents Amendment Ordinance 2004 to further extend the scope of software patenting to
any computer program that has industrial application and to those that are used in combination with
hardware
...
Still, an invention shall not become unpatentable in
India merely because it was implemented with software
...
If the claims are
drafted in such a way as to reflect that the invention is not software per se, it shall qualify for patent
protection
...
After information technology, biotechnology is increasingly recognised as the next
wave in the knowledge-based economy
...
In particular,
progress in the field of molecular biology, biotechnology and molecular medicine has highlighted the potential
of biotechnology for the pharmaceutical industry
...
e
...
Micro-organisms include bacteria, fungi, virus, protists and other prokaryotes as well as some microscopic
plants (phytoplankton) and animals (zooplankton)
...
In 1980 the US Supreme Court in Anand Chakrabarty’s case allowed patenting of crude oil
spilling bacterium) and this subject has been drawing a great deal of attention all over the world
...
The US Supreme Court ruled that genetically altered micro-organisms were indeed patentable based on the
following criteria:
•
They were man-made;
•
They were products of human manipulation and therefore considered similar to any other invention;
•
They had a specified industrial application (one criterion for patenting is that the invention has utility)
...
Since 1930
certain asexually reproduced plants have been protected by patenting
...
Lesson 6
Recent Developments in Patent System 109
As a result of the Supreme Court’s decision, the US biotechnology industry flourished and many US patents
have been granted on human-made higher life forms such as transgenic mice, fish etc
...
S
...
Europe views patenting of
"man-made" life in much the same manner as the U
...
patent office
...
Article 27
...
Though the TRIPS agreement mandates patent protection for micro-organisms, it does not define microorganisms; thus there is no standard definition for member nations to follow
...
The Indian Patent
Act has now a specific provision in regard to patenting of micro-organisms and microbiological processes
...
The most vital distinction between the legal practices of India and developed countries is that India does not
allow patenting of micro-organisms which already exist in nature, as the same is considered to be a
discovery as per the provisions of the Section 3(d) of the Patents Act, 1970 and therefore not patentable
...
Another requirement is sufficiency of disclosure which is very important
...
The Act or the Rule, however, does not
stipulate any condition or procedure to meet the requirement of sufficiency of disclosure in the case of
inventions involving use of biological material, which are very difficult to describe in words
...
, accorded by a depository institution either foreign or
Indian in the patent specification to satisfy the requirement of sufficiency of disclosure of the invention
desired to be patented
...
An international treaty called "Budapest Treaty" was
signed in Budapest in 1973 and later on amended in 1980
...
This is an international convention governing the recognition of deposits in
officially approved culture collections for the purpose of patent applications in any country that is a party to
this treaty
...
Under the Patents Act, 1970 if the invention uses a biological material which is new, it is essential to deposit
the same in the International Depository Authority (IDA) prior to the filing of the application in India in order to
110 PP-IPRL&P
supplement the description
...
[Section 10(4)
(d)(ii)]
...
There
are many international depositories in different countries such as MTCC, DSM etc
...
The Institute of Microbial Technology (IMTECH), Chandigarh is the first Indian depository set up under the
Budapest Treaty
...
LESSON ROUND UP
•
A software patent is generally defined as a patent that protects some programming technique
...
•
Most countries place some limits on the patenting of invention involving software, but there is no legal
definition of a software patent
...
Such countries include
USA, Australia and Singapore, to name a few
...
•
Most of the jurisprudence relating to software patents emanate from US, which is considered as the cradle
of software patents
...
Computer software on the other hand is protected by copyright as applicable to literary and
aesthetic works
...
•
The Indian Patent Act as of now excludes only ‘computer programs per se’ from patentability
...
•
After information technology, biotechnology is increasingly recognized as the next wave in the knowledgebased economy
...
•
Prior to 1980 micro-organisms were clearly "products of nature" and as such were not considered
patentable
...
•
TRIPS Agreement obliges member states to patent micro-organisms
...
It is now possible
to get a patent for a microbiological process and also products emanating from such processes
...
Answers to these questions are not to be submitted for
evaluation
...
How has a software patent been defined? Briefly discuss some of the important issues concerning
software patenting
...
Discuss the criteria of patentability of software in India and other jurisdictions
...
Are micro-organisms and micro-biological processes patentable in India? Discuss
...
How is the requirement of sufficiency of disclosure met in the case of micro-organisms?
5
...
Discuss
...
The period of protection varies, but a
•
Registration of Trade Marks
•
Procedure for Registration
trademark can be renewed indefinitely beyond the
time limit on payment of additional fees
...
Trade mark protection also hinders the efforts of
•
Assignment& Transmission
•
Offences Penalties
•
Madrid Agreement
•
Domain Names
•
Lesson Round Up
•
Self Test Questions
unfair competitors, such as counterfeiters, to use
similar distinctive signs to market inferior or different
products or services
...
With the advent of WTO, the law of trade marks is
now modernized under the Trade Marks Act of 1999
and is in harmony with two major international
treaties on the subject, namely, The Paris
Convention for Protection of Industrial Property and
TRIPS Agreement
...
114 PP-IPRL&P
A trade mark (popularly known as brand name in layman’s language) is a visual symbol which may be a
word to indicate the source of the goods, a signature, name, device, label, numerals, or combination of
colours used, or services, or other articles of commerce to distinguish it from other similar goods or services
originating from another
...
Its origin dates back to ancient times, when craftsmen
reproduced their signatures, or "marks" on their artistic or utilitarian products
...
The system helps consumers identify
and purchase a product or service because its nature and quality, indicated by its unique trade mark, meets
their needs
...
The period of protection varies, but a trade mark
can be renewed indefinitely beyond the time limit on payment of additional fees
...
In a larger sense, trade marks promote initiative and enterprise worldwide by rewarding the owners of trade
marks with recognition and financial profit
...
The system enables people with skill and enterprise to produce and market goods and services in
the fairest possible conditions, thereby facilitating international trade
...
Prior to that protection of
trade marks was governed by Common Law
...
Some of the provisions of the first Trade Marks Act, 1940
came into force on 11
...
1940 and the rest became effective on 1
...
1942 (Gazette of India Extraordinary,
1942
...
684)
The said enactment was amended by the Trade Marks (Amendment) Act, 1941 and later by two other
amendments
...
Thereafter, the
Act was amended by the Trade Marks (Amendment) Act, 1946, to give effect to the reciprocal arrangement
relating to trade marks between the Government of India and the then Indian States and further amendments
introduced by Part B States Laws Act, 1951
...
Justice Rajagopala Ayyangar (then a Judge of the Madras High Court, who later served and
retired as a judge of the Supreme Court) was appointed by the Government of India to examine the Trade
Marks Act, 1940, with reference to the report of the Trade Marks Enquiry Committee and to recommend as
to what changes in the then law were necessary
...
Justice Ayyangar, the
Trade Marks Act, 1940 was replaced by the Trade & Merchandise Marks Act, 1958
...
4
...
The Trade & Merchandise Marks Act, 1958 was brought into force on 25th
Lesson 7
Trade Marks 115
November 1959
...
Thus, the history of legal protection to trade marks in India is more than a century old
...
With the advent of WTO, the law of trade marks is now modernized under the Trade Marks Act of 1999
which provides for the registration of service marks and introduces various other provisions in conformity with
the Trade Mark Law in developed countries
...
5
...
However, as the Bill failed to get
through the Rajya Sabha, it lapsed on the dissolution of the Lok Sabha
...
The Bill
received the assent of the President on 30
...
1999 and became an Act
...
It repealed the earlier Trade &
Merchandise Marks Act, 1958
...
Under the Trade Marks Act, the Controller -General of Patents, Designs and Trade Marks under Department
of Industrial Policy and Promotion, Ministry of Commerce and Industry is the ‘Registrar of Trade Marks’
...
The Trade Marks Registry administers the Trade Marks Act, 1999 and the Rules
thereunder
...
The main function of the Registry is to register trade marks which qualify for registration
under the Act and Rules
...
(b) Amplification of definition of trade mark to include registration of shape of goods, packaging and
combination of colours
...
(d) Recognition of the concept of "well-known trade marks"
...
(f) Widening the scope of infringement of trade marks
...
(g) Creation of an "Intellectual property Appellate Board" for hearing appeals against orders and
decisions of the Registrar of Trade Marks for speedy disposal of cases and rectification applications
which hitherto lie before High Courts
...
(i) Recognition of use of trade mark by even an unregistered licensee
...
The rights granted under the Act, are operative in the whole of India
...
The Act empowers the Registrar to register
certification trade marks
...
Provision for
enhanced punishment for the offences relating to trade marks on the lines of Copyright Act, 1957; restriction
on sale of spurious goods; and use of someone else's trade marks as part of corporate names, or name of
business concern have also been incorporated in the new Act
...
Civil suits can be instituted by any aggrieved person before a District Court, within the local limits of whose
jurisdiction such aggrieved person actually and voluntarily resides or carries on business or personally works
for gain
...
Under the Trade Marks Act, 1999 the Government of India is empowered to make rules for implementing the
Act and regulating the trade marks Administration
...
These rules were subsequently amended in 2002 and came into force on the date on which the Trade
Marks Act, 1999 came into force i
...
15-09-2003
...
Object of Trade Marks Law
The object of trade mark law has been explained by the Supreme Court in Dau Dayal v
...
Normally, the remedy for such infringement will be by action in Civil
Courts
...
Lesson 7
Trade Marks 117
The distinction between a trade mark and a property mark has been stated by the Supreme Court in the case
of Sumat Prasad Jain v
...
, AIR 1972 SC 413
...
In other
words, a trade mark concerns the goods themselves, while a property mark concerns the proprietor
...
”
The trade mark law in India is a ‘first-to-file’ system that requires no evidence of prior use of the mark
...
The term ‘use’ under the Trade Marks Act, 1999 has acquired a broad meaning and does not
necessarily mean the physical presence of the goods in India
...
One of the first landmark judgments in this regard is the “Whirlpool case” [N
...
Dongre v
...
It would suffice if the rights
holder has attained reputation and goodwill in respect of the mark in India through advertisements or other
means
...
As stated above, the definition of "trade mark" under Section 2(1)(zb) has been enlarged to mean a mark
capable of being represented graphically and which is capable of distinguishing the goods or services of one
person from others and may include shape of goods, their packaging and combination of colours and covers
both goods and services
...
[Section 2(1)(m)]
...
Service
The new definition of 'service' has been included for the benefit of service-oriented establishments such as
banking, communication, education, finance, insurance, chit funds, real estates, transport, storage, material
treatment, processing, supply of electrical or other energy, boarding, lodging, entertainment, amusement,
construction, repair, conveying of news or information and advertising
...
Normally, a mark for goods appears on the product or on its packaging, while a service
mark appears in advertising for the services
...
The renewal of registration of a trade mark should
be made for every ten years instead of seven years under the present Act
...
[ Section 2(1)(e)
Collective Mark
The new definition of ‘collective mark ' has been provided for the benefit of members of an association of
persons (but not partnership) and such inclusion of 'collective mark' will benefit the traditional Indian family
trade marks
...
Trade Description
Trade description under Section 2(1)(za) means any description, statement or other indication, direct or
indirect :
(i) as to the number, quantity, measure, gauge or weight of any goods; or
(ii) as to the standard of quality of any goods or services according to a classification commonly used
or recognized in the trade; or
(iii) as to fitness for the purpose, strength, performance or behaviour of any goods, being “drug”, as
defined in the Drugs and Cosmetics Act, 1940 or “food”, as defined in the Prevention of Food
Adulteration Act, 1954; or
(iv) as to the place or country in which or the time at which any goods or services were made, produced
or provided, as the case may be; or
(v) as to the name and address or other indication of the identity of the manufacturer or of the person
providing the services or of the person for whom the goods are manufactured or services are
provided; or
(vi) as to the mode of manufacture or producing any goods or providing services; or
(vii) as to the material of which any goods are composed; or
(viii) as to any goods being the subject of an existing patent, privilege or copyright, and includes –
(a) any description as to the use of any mark which according to the custom of the trade is
commonly taken to be an indication of any of the above matters;
(b) the description as to any imported goods contained in any bill of entry or shipping bill;
(c) any other description which is likely to be misunderstood or mistaken for all or any of the said
matters;
Lesson 7
Trade Marks 119
Well Known Trade mark
Being a signatory to the Paris Convention and TRIPS, India recognizes the concept of a well known trade
marks
...
A mark, which has been designated as a well known mark, is accorded stronger protection
...
Permitted Use
Section 2(1) (r) defines the term “permitted use”, in relation to a registered trade mark, as to mean the use of
trade mark(i) by a registered user of the trade mark in relation to goods or services (a) with which he is connected in the course of trade; and
(b) in respect of which the trade mark remains registered for the time being; and
(c) for which he is registered as registered user; and
(d) which complies with any conditions or limitations to which the registration of registered user is
subject; or
(ii) by a person other than the registered proprietor and registered user in relation to goods or services
(a) with which he is connected in the course of trade; and
(b) in respect of which the trade mark remains registered for the time being; and
(c) by consent of such registered proprietor in a written agreement; and
(d) which complies with any conditions or limitations to which such user is subject and to which the
registration of the trade mark is subject
...
The word “High Court” has been deleted consequent to the provision to constitute Appellate
Board in lieu of High Court, for appeals
...
Other officers may also be appointed by the Central Government under Section 3(2) for the purpose of
discharging such functions of the Registrar as he may authorize them to discharge under his
superintendence and direction
...
Section 7 empowers the Registrar to classify
goods and services according to International classification of goods and services for the purpose of
registration of trade marks and to determine any question related thereto
...
REGISTRATION OF TRADE MARKS
The process whereby a trade mark is entered on the register of the trade marks is referred to as registration
...
In case of a
company about to be formed, anyone may apply in his name for subsequent assignment of the registration in
the company's favour
...
Registration Procedure
The registration procedure in India is based on the ‘first to file’ system
...
The registration of a trade mark in India
typically takes about 2 to 3 years, subject to the trade mark not being opposed by a third party
...
This office has branches in Mumbai, Delhi, Chennai, Ahmedabad and Kolkata
...
The different steps
that are involved in the registration process in India are as follows:
Trade Mark Search
Before making an application for registration, it is prudent to make an inspection of the already registered
trade marks to ensure that registration may not be denied in view of resemblance of the proposed mark to an
existing one or prohibited one
...
Who May Apply for Trade Mark ?
As per Section 18 of the Trade Marks Act, 1999 any person “claiming to be the proprietor” of the trade mark
‘used’ or ‘proposed to be used’ by him may make an application in the prescribed manner for registration of
his trade mark
...
[Section 3(42),
General Clauses Act, 1897]
Company
A company may make an application for registration of a trade mark in its own corporate name
...
Lesson 7
Trade Marks 121
Firm
A partnership firm shall make the application in the names of all trading within the firm partner
...
It has been held that if there is omission of the name of any partner in TM-1 (i
...
application to register a
trade mark for a specification of goods or services) or corresponding new application form, the omission can
be corrected when supported by necessary documents
...
(Vivekananda Match company v
...
However,
any new addition or deletion of name of a partner subsequent to the date of application will mean change in
the partnership
...
Government
The Central or State Government or any undertaking/company owned or controlled by such Government
may also make application for registration of trade mark like any other person
...
The trade mark law in India allows the proprietor to file a trade mark application only if they have a place of
business in India
...
The trade mark agent/attorney can do a trade mark search, prepare, file and
prosecute the applications
...
In the case of joint applicants, the principal place of business in India of the applicant will be that of the
person whose name is first mentioned as having a place of business
...
No change in
the principal place of business in India or in the address for service in India shall affect the jurisdiction of the
appropriate office once entered (Rule 5)
...
ipindiaonline
...
in/etmr/)
...
If the trade mark is registered, the
application number becomes the registration number
...
Accordingly, they issue an examination report and the Applicant must respond to the
objections that have been raised in the examination report within a period of one month from the issuance of
the examination report
...
Should the application be
rejected, the Applicant can approach the Intellectual Property Appellate Board to appeal the order of the
Registrar of Trade Marks
...
Requisites for Registration
The Trade Marks Act, 1999 does not expressly list any requisites for registration
...
Instead of detailing requisites for registration,
grounds for refusal are listed in Section 9(1), (2) and (3) & Section 11 which conversely are requisites for
registration
...
From previous
operation of trade mark law, four categories of trade marks were made out i
...
, names, signatures, words
and other distinctive marks
...
Now any mark which is a trade mark may be registered for any goods or services if it is not hit by any of the
two kinds of grounds for refusal or other specific prohibitions
...
There emerge many conditions from the definition of
trade mark in Section 2(1) (zb)
...
That the trade mark is registered in any
other member country of Paris Convention* or has been refused to be registered is not a factor to be
considered in relation to registration of the trade mark
...
The next pre-requisite—distinctive character emerges from the presence of words ”capable of distinguishing
goods of one person from those of others…
...
A mark shall
be trade mark only if, in addition to fulfilling other conditions in the definition of trade mark, also satisfies the
requirement of distinctive character
...
The Trade Marks Act, 1999, as in earlier laws also, recognizes that distinctive character may be
inherent or acquired
...
If the reference to the character or quality is only indirect or
suggestive, the mark may be considered as possessing sufficient degree of inherent capacity to distinguish
...
The
fundamental principle is that “traders should not obtain any monopoly in the use of words as trade marks to
the detriment of the members of the public, who, in the future and in connection with their goods might desire
to use them”
...
— It should be capable of distinguishing the goods or services of one undertaking from those of others
...
Duration and Renewal of Trade Mark Registration
Trade mark protection in India is perpetual subject to renewal of the registration after every 10 years
...
Section 25 of the Act allows registration of a trade mark for a period of 10 years
...
With a view to facilitate renewal of registration, Section 25(3) provides for a grace period of
six months for payment of renewal fee after expiry of registration, subject to the payment of the prescribed
surcharge
...
Unlike patents, copyright or industrial designs, trade mark rights can last indefinitely if the owner continues to
use the mark
...
Should the rights holder of a trade mark come across a trade mark that is deceptively similar to their mark
and which has been published in the Trade Marks Journal, they can oppose the impugned mark within three
months of the publication of the journal
...
Priority in adoption and use of a
trade mark is superior to priority in registration [Consolidated Foods Corporation v
...
Pvt
...
,
AIR 1965 Bom
...
The Supreme Court in Commissioner of Income-tax v
...
, AIR 1951 SC 464, has held that the
expenditure incurred on registration of trade mark is capital expenditure thus allowable deduction under the
Income-tax Act
...
v
...
If, thus,
goods are sold which are produced from two sources, the same may lead to confusion in the mind of the
consumers
...
A proprietor of a registered trade
124 PP-IPRL&P
mark indisputably has a statutory right thereto
...
Ordinarily, therefore, two people are not entitled to the same trade
mark, unless there exists an express licence in that behalf
...
The person need not
be a prior registered trade mark owner
...
The question of bona fides of the opponent does not arise
...
•
It should be filed at the appropriate office – see rule 8
•
The provisions of rule 18 regarding 'address for service' must be complied with, where
necessary
...
(b) in respect of the earlier mark or the earlier right on which the opposition is based,(i) where the opposition is based on an earlier mark, a statement to that effect and an indication of
the status of earlier mark;
(ii) where available, the application number or registration number and the filing date, including the
priority date of the earlier mark;
(iii) where the opposition is based on an earlier mark which is alleged to be a well-known trade
mark within the meaning of sub-section (2) of section 11, an indication to that effect that an
indication of the country or countries in which the earlier mark is recognized to be well known
...
(c) in respect of the opposing party(i) where the opposition is entered by the proprietor of the earlier mark or of the earlier right, his
name and address and an indication that he is the proprietor of such mark or right;
(ii) where opposition is entered by a licensee not being a registered user, the name of the licensee
and his address and an indication that he has been authorized to enter the opposition
...
Grounds of Opposition
Section 21, which provides for filing Notice of Opposition, does not refer to any ground on which the
opposition may be filed
...
However, under section 11(5), a trade mark shall not be refused registration on the grounds specified in subsection (2) and (3), unless objection on any one or more of those grounds is raised in opposition proceedings
by the proprietor of the earlier trade mark
...
[See also section 12, section 13,
section 14 and section 18, which may form grounds of opposition]
...
(1) That the trade mark advertised is not registrable in that it is neither distinctive nor capable of
distinguishing or that it does not satisfy the requirements of the Act as to registrability;
(2) The essential part of the said trade mark is a word in ordinary use, descriptive of the character or
quality of the goods and the applicant is not entitled to acquire an exclusive right therein by
registration;
(3) That the trade mark is not capable of being represented graphically;
(4) That the trade mark is devoid of distinctive character, that is to say, not capable of distinguishing the
goods, or services of one person from those of another person;
(5) That the trade mark consists exclusively of marks of indication which may serve to designate the
kind, quality, intended purpose, values, geographical origin or the time of production of the goods or
rendering of the services or other characteristics of the goods or services (mark which is directly
descriptive of the character or quality of the goods or services or indicating geographical origin);
(6) That the trade mark consists exclusively of marks or indications which have become in the current
language or in the bona fide and established practice of the trade (may refer to generic names or
126 PP-IPRL&P
marks common to the trade);
(7) That the trade mark is of such a nature as to deceive the public or cause confusion;
(8) That the trade mark contains or comprises of any matter likely to hurt the religious susceptibilities of
any class or section of the citizens of India;
(9) That the trade mark comprises or contains scandalous or obscene matter;
(10) That the trade mark is :
(a) identical with or similar to an earlier trade mark, and
(b) is to be registered for goods or services which are not similar to those for which the earlier trade
mark is registered in the name of a different proprietor, and the earlier trade mark is a well
known trade mark in India and the use of the later mark without due cause would take unfair
advantage of or be detrimental to the distinctive character or repute of the earlier trade mark;
(11) That the use of the applicant’s mark would be an infringement of the opponent’s registration which
could be restrained by the Court and the mark is therefore disentitled to protection in a Court;
(12) That the applicants are not entitled to registration under s
...
Section 9(1) prohibits the registration of those trade marks(a) which are devoid of any distinctive character, that is to say, not capable of distinguishing the goods
or services of one person from those of another person;
(b) which consist exclusively of marks or indications which may serve in trade to designate the kind,
quality, quantity, intended purpose, values, geographical origin or the time of production of the
goods or rendering of the service or other characteristics of the goods or services; or
(c) which consist exclusively of marks or indications which have become customary in the current
language or in the bona fide and established practice of the trade
...
The basis of Section 9(1) is that a trader should not obtain a statutory monopoly through registration in a
word which another trader might legitimately wish to use
...
If a word, however, through use
has become clearly associated in public mind with the goods/service of a particular trader, then it could not
be legitimately used as a trade mark by a competitor
...
If a trade mark is devoid of distinctive character, the same can not be registered
...
Tata Oil Mills Company Limited 1988 OTC 73 Bom, it was held that the word PROMIX
Lesson 7
Trade Marks 127
was distinctive
...
Applicants are the proprietors of a series of trade marks having prefixed PRO as a
leading distinguishing feature
...
Length of user is a material factor to acquire distinctiveness in a trade mark (Durga Dutt Sarma v
...
This view was affirmed in Kaviraj Pandit Durga Dutt
Sharma v
...
The Apex Court held that the length
of user would, of course, be a material factor for the mark to become distinctive
...
Hoffmann La Roche and Co
...
v
...
Pvt
...
, AIR 1970 SC 2062, the Supreme
Court held that if the word DROPOVIT is not a descriptive word it must be an invented word
...
But the resulting combination produces a new word, a newly coined word which does not remind an ordinary
person knowing English of the original words out of which it is coined unless he is so told or unless at least
he devotes some thought to it
...
[See
also Eastman Photographic Materials v
...
Thankaraja,
AIR 1978 Mad 336]
...
v
...
, AIR 2002 SC 117, the Supreme
Court observed
"
...
People
have come associate the name "Mahindra" with a certain standard of goods and services
...
Such user may also affect the plaintiff
prejudicially in its business and trading activities
...
Under Section 9(2), if the confusion arises from any factor whatsoever, even without involvement of any
other mark or there being no similarity with any other mark, the registration may still be refused if the
impugned mark is of such nature that it will cause confusion
...
v
...
The medical preparations sold at the prescription by doctors and supplied by qualified pharmacists have
been considered a special case for determining deceptive similarity
...
Therefore, in the field of drugs and
chemicals, the names with small variations are allowed
...
Uni Sole Pvt
...
, 1999
PTC 188, the Bombay High Court has applied the test of person of ordinary intelligence as against doctors
and pharmacists
...
128 PP-IPRL&P
In Group Pharmaceuticals v
...
1996, PTC (16)117, opponents objections were sustained and the
registration of the trade mark Metro-D for pharmaceutical preparations when opposed by the proprietor of
Metro-N was refused as customers of ordinary prudence and average intelligence are likely to be deceived
...
A
...
Robins Co
...
v
...
It is, however, explained that the nature of goods or services in relation to which the trade
mark is used or proposed to be used shall not be a ground for refusal of registration
...
It is considered that will create unacceptable distortions in the
market
...
In other words, the shape should not be descriptive and must stand out from the crowd, and in the case of
new product development must not be a shape likely to be taken for the product concerned
...
This
will attract objection under section 9(3)(b)
...
The shape of an ornamental lamp, for example would appear to add substantial value to the goods by
making it attractive
...
Relative Grounds (Section 11)
Section 11 of the Act stipulates that where there exists a likelihood of confusion on the part of the public
because of the identity with an earlier trade mark or similarity of goods or services, the trade mark shall not
be registered
...
Sub-section (3) prohibits the registration of a trade mark if or to the extent that, its use in
India will be prevented by law of passing off or under the law of copyright unless the proprietor of the earlier
trade mark consents to such registration
...
The proprietor of earlier trade mark is entitled to oppose the registration of a trade mark and prove it
...
Further, the section also lays down the factors which the Registrar is required to
take into account while determining the status of a well-known trade mark
...
What is a well known trade mark, the Delhi High Court held in Tata Sons Ltd
...
Mr
...
Jawed & Anron
(March, 2011) held that a well known trade mark is a mark which is widely known to the relevant section of
the general public and enjoys a comparatively high reputation amongst them
...
It is, therefore, being increasingly felt that such trade marks need to be
protected not only in the countries in which they are registered but also in the countries where they are
otherwise widely known in the relevant circles so that the owners of well known trade marks are encouraged
to expand their business activities under those marks to other jurisdictions as well
...
He may also prevent others from incorporating the well known trade mark as a part of
their corporate name/business name
...
The Trade Marks Act, 1999 accords a statutory protection to well known marks, irrespective of whether
they are Indian marks or foreign marks
...
Concurrent Use - Exception to Section 11
To all the relative grounds of refusal, the Trade Marks Act, 1999 allows one exception in Section 12
...
This is done so if in the opinion of the Registrar it is proper so to do in favour of more than one proprietor
of trade mark
...
The provisions establish the superiority of trade mark rights acquired by use
...
While
registration of a trade mark is not compulsory, it offers better legal protection for an action for infringement
...
(ii) If the trade mark consists of several matters, there is an exclusive right to the use of the trade mark
taken as a whole
...
130 PP-IPRL&P
(iii) It entitles the registered proprietor to obtain relief in respect of infringement of the trade mark in the
manner provided by the Trade Marks Act, 1999 when a similar mark is used on (a) same goods or
services, (b) similar goods or services, (c) in respect of dissimilar goods or services
...
(v) After registration of the trade mark for goods or services, there shall not be registered the same or
confusingly similar trade mark not only for the same goods or services but also in respect of similar
goods or services by virtue of Section 11(1) of Trade Marks Act, 1999
...
(vii) Registered trade mark shall not be used by any one else in business papers and in advertising
...
Such advertising
should not be contrary to honest practices in industrial or commercial matters
...
(viii) There is a right to restrict the import of goods or services marked with a trade mark similar to one’s
trade mark
...
The registered trade mark continues to enjoy all the rights which vest in an unregistered trade mark
...
An application for registration may be based on a trade mark in use prior to such application and such
a trade mark is already vested with rights at Common law from the time the use of the mark was
commenced
...
Under the Trade Marks Act, 1999 the meaning of infringement has been enlarged as more actions shall be
taken as constituting infringement which are listed in Section 29
...
This section lays down that when a registered trade mark is used by
a person who is not entitled to use such a trade mark under the law, it constitutes infringement
...
Sub-section (4) states that a person shall be deemed to have infringed a registered trade mark, if he uses a
mark which is identical with or similar to the trade mark, and is used in relation to goods or services which
Lesson 7
Trade Marks 131
are not similar to those for which trade mark is registered; and the registered trade mark has a reputation in
India and the use of the mark without due cause would take unfair advantage of or is detrimental to the
distinctive character or repute of the registered trade mark
...
A person shall be deemed to have used a registered trade mark in circumstances which include affixing the
mark to goods or packaging, offering or exposing the goods for sale or supply of services, importing or
exporting the goods, using the trade mark as trade name or trade mark on business paper or in advertising
...
Advertising of a trade mark to take unfair advantage of, or against the honest industrial or
commercial practices or which is detrimental to the distinctive character or is against the reputation of the
trade mark shall constitute an infringement under Section 29(8) of the Act
...
The infringement action is a statutory remedy available to the registered proprietor or to the registered user,
based on statutory rights conferred by registration of a trade mark, subject to other restrictions laid down in
Sections 30, 34, 35 of the 1999 Act
...
If at the time of
registration of trade mark, certain limitations or conditions have been imposed, then, the exclusive right has
to be evaluated within the terms of such registration
...
M/s Adani Wilmar Ltd
...
), the Delhi High Court held that in
order to constitute infringement under the provisions of Section 29 of the Trade Marks Act, it would be
necessary to show that impugned trade mark (label) is identical or deceptively similar to the registered trade
mark
...
In Parle Products v
...
AIR 1972 SC 1359, the Apex Court observed that in this case the packets are
practically of the same size, the colour scheme of the two wrappers is almost the same; the design on both,
though not identical, bears such close resemblance that one can easily be mistaken for the other
...
In the background there is a farm house with
a fence
...
Anyone, in our opinion, who has a look at one
of the packets on a day, may easily mistake the other if shown on another day as being the same article
which he had seen before
...
After all, an ordinary purchaser is not gifted with the powers of observation of
a Sherlock Holmes
...
For
infringement nothing more is required to be proved
...
In S
...
Dychem v
...
The Court
further said that if the essential features have been copied, the intention to deceive or cause confusion is not
relevant in an infringement action
...
However, in the present case on the question of
relative strength, the decision must go in favour of the defendant and the High Court was right
...
The Calcutta High Court in Hearst Corpn
...
Dalal Street Communication Ltd
...
In the present case, the plaintiff had been publishing a monthly
magazine from 1933 and selling the same in the name of its registered trade mark ‘Esquire’ since 1942
...
From October, 1994 the defendant started publishing a monthly magazine with the name ‘Esquare’
...
Ltd
...
v
...
(P) Ltd
...
For these reasons, on the basis of the phonetic similarity, it appears
to be clear that an unwary purchaser of average intelligence and imperfect recollection would be likely to
confuse the defendant’s use of the mark ‘Esquare” on its magazine with the plaintiff’s publication ‘Esquire’
...
This, of course, implies a certain lack of bona fides on the imitators’ part
...
[See also Amritdhara
Pharmacy v
...
In Brooke Bond India v
...
Patel & Co
...
), the Court held that application by the
defendants of the trade mark Taj Tea in India on the packets of tea is an infringement of the registered trade
mark of the plaintiff
...
In Cox Distillery v
...
, 1999
PTC 507, the Court said that there is deceptive similarity between the label used by the plaintiff as his trade
mark and the one introduced by the defendant
...
The defendant was restrained from using COX DIPLOMAT premium Whisky
as the defendant used the logo and print of similar size and word DIPLOMAT on label with the printed figure
of human being which made his label similar to the registered trade mark of the plaintiff
...
Master Hawa Singh, 2000 PTC206; Amar Singh chawalwala v
...
R
...
Micronix, 1994 Supp (3) SCC 215; Himalaya Drug v
...
1996, PTC
553]
...
Ltd
...
Agarwal Textiles Mills, AIR 1971 (Cal),
considered the resemblance in respect of the get up of the two marks phonetically 'Moti' and 'Sacha Moti'
...
There is phonetic similarity between the words
...
Therefore, even though the defendant used his father's name, it was
held that the defendant's use of the name and mark was likely to deceive or cause confusion or injury to the
goodwill of the plaintiff's business
...
v
...
The purpose of a trade mark is to establish a
connection between the goods and the source thereof which would suggest the quality of goods
...
In T
...
Venugopal v
...
, (2011) 4 SCC 85, the Supreme Court noted that the
respondent’s mark “Eenadu” had acquired extraordinary reputation and goodwill in the State of Andhra
Pradesh
...
The Court reasoned that allowing the Appellant to use the mark would create confusion in the
mind of the consumers, leading the consumers to think that the incense sticks were manufactured by the
Respondent’s company
...
The law is consistent that
no one can be permitted to encroach upon the reputation and goodwill of other parties
...
Delhi High Court in Infosys Technologies Ltd
...
Adinath Infosys Pvt
...
& Ors, ( November, 2011) held that
by using the word INFOSYS which is the registered trade mark of the plaintiff as the key feature of its
corporate name, defendant has clearly infringed the registered trade mark of the plaintiff
...
ASSIGNMENT AND TRANSMISSION
Assignment and Transmission have been defined under Section 2(1) (b) and 2(1)( zc) of the Trade Marks
Act, 1999 respectively
...
Under section 2(1)(zc) “transmission” means transmission by operation of law, devaluation on
the personal representative of a deceased person and any other mode of transfer, not being assignment
...
The
provisions concerning assignment and transmission of trade mark are contained in section 37 to 45 if the
Trade marks Act,1999 read with rule 68 to 79 of the trade marks rules
...
Under the new Act, a registered trade mark is assignable
and transmissible whether with or without goodwill of the business either in respect of all goods or services
or part thereof
...
134 PP-IPRL&P
Assignment of a trade mark without goodwill of business is not allowed unless the assignor obtains directions
of the Registrar and advertises the assignment as per the Registrar’s directions
...
Associated trade
marks are assignable and transmissible only as a whole but they will be treated as separate trade marks for
all other purposes
...
The validity of the assignment can be
challenged only on the basis of the provisions contained in Sections 37 to 45 of Trade Marks Act, 1999
...
Earlier such an assignment or transmission without goodwill used to be on a different footing
...
It lays down that an unregistered trade mark may also be assigned with or
without goodwill
...
Now, both unregistered and
registered trade mark are subject to same conditions stated in Section 42, wherein such an assignee is
required to apply to the Registrar within six months extendable by three months for directions with respect to
advertisement
...
Earlier Section 38 of the Trade & Merchandise Marks Act, 1958 provided for assignment or transmission of
an unregistered trade mark without goodwill only if the following conditions were fulfilled:
(i) used in same business as a registered trade mark;
(ii) assigned at the same time to same person as registered trade mark;
(iii) used on same goods as registered trade mark
...
The situation has changed under Section 39 of Trade Marks Act, 1999 and now,
even an unregistered trade mark can be assigned or transmitted without the goodwill of the business
concern, and, without subjecting it to the above condition of coupling it with a registered trade mark
...
Section 50 empowers the Registrar to vary
or cancel registration as registered user on the ground that the registered user has used the trade mark
otherwise than in accordance with the agreement or in such a way as to cause or likely to cause confusion,
or deception or the proprietor/registered user misrepresented or has failed to disclose any material facts for
such registration or that the stipulation in the agreement regarding the quality of goods is not enforced or that
the circumstances have changed since the date of registration, etc
...
Section 51 empowers the Registrar to require the proprietor to confirm, at any time during the continuation of
registration as registered user, whether the agreement on the basis of which registered user was registered
is still in force, and if such confirmation is not received within a period of three months, the Registrar shall
remove the entry thereof from the Register in the prescribed manner
...
Lesson 7
Trade Marks 135
Section 54 provides that the registered user will not have a right of assignment or transmission
...
COLLECTIVE MARKS
The primary function of a collective mark is to indicate a trade connection with the Association or
Organisation
...
Sections 61 to 68 contain provisions relating to the registration of collective trade marks
...
Collective marks serve to distinguish
characteristic features of the products or services offered by those enterprises
...
The association
ensures compliance of certain quality standards by its members, who may use the collective mark if they
comply with the prescribed requirements concerning its use
...
The proprietor of a certification trade mark does not himself deal in the goods
...
Unlike the old Act
which empowered the Central Government to register certification trade mark, the new Act delegates the
final authority for registration of certification trade mark to the Registrar
...
Distinction between “Trade Mark” and “Certification Mark”
Trade marks in general serve to distinguish the goods or services of one person from those of others
...
OFFENCES, PENALTIES AND PROCEDURE
Sections 101 to 121 deal with the matters relating to offences, penalties and procedure
...
1
...
and imposes
punishment with imprisonment for a term which shall not be less than six months but which may
extend to three years and with fine which shall not be less than fifty thousand rupees but which may
extend to two lakh rupees
...
Section 105 prescribes enhanced penalty on second and subsequent conviction for offences
committed under sections 103 and 104 and imposes punishment with imprisonment which shall not
be less than one year but which may extend to three years and with fine which shall not be less
than one lakh rupees but which may extend to two lakh rupees
...
Section 106 provides penalty for removing piece goods, etc
...
This section provides for forfeiture
of goods to the government and fine upto ` 1000
...
Section 107 makes it an offence if a person falsely represents a trade mark as registered
...
The punishment for such offences is imprisonment for a term which may
extend to three years or with fine or with both
...
5
...
6
...
This offence is
punishable with imprisonment not exceeding two years or with fine or with both
...
Where a person accused proves that the offence was
committed without his knowledge or he has exercised all due diligence to prevent the commission of such
offence, he will not be liable
...
Explanation to this section defines a
company as to mean body corporate and includes a firm or other association of individuals
...
Relief in Suits for Infringement/Passing Off
Civil Litigation : A suit can be initiated either under the law of passing off or for infringement under the Trade
Marks Act, 1999 depending on whether the trade mark is unregistered, pending registration or registered
respectively
...
The suit can be at the place
where the rights holder or one of the rights holders actually and voluntarily reside or work for gain or
carries on business
...
Ex-parte Interim Injunction : Most Indian Courts will grant ex-parte interim injunctions
...
This injunction is normally granted at the early stages of the
trial and many a times on the first date of hearing itself, provided that the rights holder is able to establish its
rights before the Court and prove the gravity of the offence, merits immediate consideration
...
The Court shall not grant relief by way of damages (other than nominal damages) or on account of profits in
any case—
(a) where in a suit for infringement of a trade mark, the infringement complained of is in relation to a
certification trade mark or collective mark; or
(b) where in a suit for infringement the defendant satisfies the court—
(i) that at the time he commenced to use the trade mark complained of in the suit, he was unaware
and had no reasonable ground for believing that the trade mark of the plaintiff was on the
register or that the plaintiff was a registered user using by way of permitted use; and
(ii) that when he became aware of the existence and nature of the plaintiff’s right in the trade mark,
he forthwith ceased to use the trade mark in relation to goods or services in respect of which it
was registered
...
or
or
or
of
The distinction between a suit based on infringement and that based on passing off was explained by the
Supreme Court in Kaviraj Pandit Durga Dutt Sharma v
...
It was explained that "while an action for passing off is a common law remedy being in substance an
action for deceit, that is, a passing off by a person of his own goods as those of another, that is not the gist of
an action for infringement
...
The use by the defendant of the trade mark of the plaintiff is not essential in an
action for passing off, but is the sine qua non in the case of an action for infringement
...
The grant of an injunction is a right expressly provided by the Trade Marks Act, 1999
...
Roshanlal AIR 1978 Del
...
In Midas Hygiene Industries (P) Ltd
...
Sudhir Bhatia and Ors
...
In cases of infringement either of trade mark or of copyright, normally an injunction
must follow
...
The
grant of injunction also becomes necessary if it prima facie appears that the adoption of the mark was itself
dishonest
...
The test,
therefore, as to likelihood of confusion or deception arising from similarity of marks is the same both in
infringement and passing off actions [See Ruston & Hornsby Ltd
...
The Zamindara Engineering Co
...
In Ramdev Food Products Pvt
...
v
...
, AIR 2006, it was held that a prima
facie case of irreparable injury has been made out by the Appellant
...
If the first two pre-requisites
are fulfilled, irreparable loss can be presumed to have taken place
...
However, Appellate Courts will substitute their discretion
if they find that discretion has been exercised arbitrarily, capriciously, perversely, or where the court has
ignored settled principles of law regulating the grant or refusal of interlocutory injunctions
...
v
...
Ltd
...
MC of Greater Mumbai (2006) 5
SCALE 263]
In Laxmikant V
...
Chetanbhai Shah and Anr
...
With the lapse of time such business or services associated with a person acquire a reputation or
goodwill which becomes a property which is protected by Courts
...
The law does not permit any one to carry on his business in such a way as would
persuade the customers or clients in believing that the goods or services belonging to someone else are his
or are associated therewith
...
The reasons are two
...
Secondly, when a person adopts or intends to adopt a name in connection with his business or
services which already belongs to someone else, it results in confusion and has propensity of diverting the
customers and clients of someone else to himself and thereby resulting in injury
...
Deepak Mangal & Others, 2010 (43) PTC
161(Del
...
He has not been
able to make any prima facie case in his favour for injuncting the defendant from using the trade mark
“PRIUS” on which the defendant is admittedly the registered proprietor and owner since 2002
...
The balance of convenience in fact lies in favour
of the defendant
...
e
...
On the other hand no irreparable loss or injury will be suffered by the
plaintiff as admittedly the plaintiff is not in the market
...
None of the ingredients for continuing of
the interim injunction in favour of the plaintiff arise
...
In these
circumstances, balance of convenience is also in favour of the defendant
...
Recently in Proctor & Gamble Co
...
Shipra Laboratories (November, 2011), the Delhi High Court held
that it is not in dispute that the defendant has been using the trade mark SAFE GUARD for sale of antiseptic
creams
...
The plaintiffs, therefore, are entitled to an appropriate
injunction, restraining the defendant from using the trade mark SAFE GUARD in respect of the product for
which registration has been granted to it by Registrar of Trade marks in India
...
The police have the power to suo motu conduct raids and seizure operations
...
Under the criminal law, should the rights holder not be aware of the details (name, address, dates of
infringement, etc
...
In the alternative, should
the rights holder be aware of the details of the infringer a complaint can be lodged with the police authorities
and raids organized accordingly
...
The maximum imprisonment that an infringer can
get under the Trade Marks Act, 1999 is up to three years with a fine of up to ` two lakhs
...
The Customs authorities have promulgated guidelines known as the Intellectual
Property Rights (Imported Goods) Enforcement Rules, 2007, under which the rights holder can record their
registered trade marks with the Customs authorities
...
These rules also empower the Custom officers to destroy the suspended goods under official supervision or
dispose them outside the normal channels of commerce after it has been determined that the goods
detained have infringed the trade marks of the rights holder and that no legal proceeding is pending in
relation to such determination
...
Safeguards to be Taken by the Proprietor of a Registered Trade Mark to Protect his Rights
The proprietor of a registered trade mark has to take some safeguards to protect his rights
...
If the trade mark is misused by others he should file a suit for
infringement and passing off and also take criminal action
...
The Madrid Agreement and Protocol are open to any State which is party to the Paris Convention for the
Protection of Industrial Property
...
In addition, an intergovernmental organization which maintains its own Office for
the registration of marks may become party to the Protocol
...
States and organizations which are party to the Madrid system
are collectively referred to as Contracting Parties
...
Who May Use the System?
An application for international registration (international application) may be filed only by a natural person or
legal entity having a connection, through establishment, domicile or nationality, with a Contracting Party to
the Agreement or the Protocol
...
However, where all the designations are effected under the Protocol (see below) the
international application may be based on a mere application for registration filed with the Office of origin
...
The International Application
An application for international registration must designate one or more Contracting Parties where protection
is sought
...
A Contracting Party may be designated only if
it is party to the same treaty as the Contracting Party whose Office is the Office of origin
...
The designation of a given Contracting Party is made either under the Agreement or under the Protocol,
depending on which treaty is common to the Contracting Parties concerned
...
Where all the designations are effected under the Agreement the international application, and any other
subsequent communication, must be in French
...
The filing of an international application is subject to the payment of a basic fee (which is reduced to 10% of
the prescribed amount for international applications filed by applicants whose country of origin is a Least
Developed Country (LDC), in accordance with the list established by the United Nations), a supplementary
fee for each class of goods and/or services beyond the first three classes, and a complementary fee for each
Contracting Party designated
...
International Registration
Once the International Bureau receives the international application, it carries out an examination for
compliance with the requirements of the Agreement, the Protocol, and their Common Regulations
...
If there are no
irregularities, the International Bureau records the mark in the International Register, publishes the
international registration in the WIPO Gazette of International Marks, and notifies it to each designated
Contracting Party
...
Any such refusal, including the indication of the grounds on which it is based, must be
communicated to the International Bureau, normally within 12 months from the date of the notification
...
Such a Contracting Party may also declare that a refusal based on an
opposition may be communicated to the International Bureau even after this time limit of 18 months
...
The procedure subsequent to a refusal (such as an appeal or a review) is carried out directly
between the administration or court of the Contracting Party concerned and the holder, without any
involvement of the International Bureau
...
Effects of an International Registration
The effects of an international registration in each designated Contracting Party are, as from the date of the
international registration, the same as if the mark had been deposited directly with the Office of that
Contracting Party
...
Protection may be limited with regard to some or all of the goods or services or may be renounced with
regard to only some of the designated Contracting Parties
...
Advantages of the Madrid System
The system of international registration of marks has several advantages for trademark owners
...
142 PP-IPRL&P
Similar advantages exist when the registration has to be renewed; this involves the simple payment of the
necessary fees, every 10 years, to the International Bureau
...
DOMAIN NAMES
Domain names are the human-friendly form of Internet addresses
...
For example, the domain name of the Tech Terms Computer Dictionary is
"techterms
...
" Each website has a domain name that serves as an address, which is used to access the
website
...
Some
domain names are preceded by "www" (which is not part of the domain name), while others omit the "www"
prefix
...
com,
...
org
...
For example, "
...
org" websites are often used by non-profit organizations
...
dk" (Denmark) or "
...
This translation is performed dynamically by a service called (DNS)
...
Technically,
any name registered in the DNS is a domain name
...
In other words the domain name is being used as a trade name or trade
mark, and the Registrar will, subject to the usual criteria of the Act, permit domain names to be registered as
trade marks if otherwise registerable
...
com" or "
...
in" are considered to be totally non-distinctive, much in
the same way as "Ltd" and "Plc"
...
WIPO Internet Domain Name Process
Domain names while designed to serve the function of enabling users to locate computers in an easy
manner, they have acquired a further significance as business identifiers and, as such, have come into
conflict with the system of business identifiers that existed before the arrival of the Internet and that are
protected by intellectual property rights
...
These policy questions have new
dimensions that are a consequence of the intersection of a global, multipurpose medium, the Internet, with
systems designed for the physical, territorial world
...
The WIPO recommendations from the
First Report were largely implemented by the Internet Corporation for Assigned Names and Numbers
(ICANN), and have resulted in implementation of a successful administrative system for resolving domain
name disputes involving trademarks and a system of best practices for domain name registration authorities,
designed to avoid such conflicts
...
The Second WIPO Internet Domain Name Process was initiated at the request of the Member States of
WIPO
...
These
other identifiers, which form the basis of naming systems used in thereal or physical world, are:
•
International Nonproprietary Names (INNs) for pharmaceutical substances, a consensus-based
naming system used in the health sector to establish generic names for pharmaceutical
substances that are free from private rights of property or control;
•
The names and acronyms of international intergovernmental organizations (IGOs);
•
Personal names;
•
Geographical identifiers, such as indications of geographical source used on goods,
geographical indications, and other geographical terms;
•
Trade names, which are the names used by enterprises to identify themselves
...
In some cases, for example, geographical indications and trade names,
elements of international protection exist, but they do not constitute a complete system that is uniformly
applied throughout the world
...
The Report finds that there is considerable evidence of the registration and use of the identifiers examined in
the Report as domain names by persons who might be considered not to be properly entitled to use the
identifiers in question
...
For example, many commentators considered that the registration as domain names of the
names of eminent political, scientific or religious persons, or the names of countries, cities or indigenous
peoples, by parties without any association with the persons, places or peoples concerned, was
unacceptable
...
That same system has also allowed the tremendous
growth that has taken place in the use of the Internet, while acting as the means of preserving universal
connectivity on the Internet
...
It is for the international community to decide whether it wishes to address any of
these insufficiencies in order to establish an adequate legal basis to deal with the practices that might be
considered to be unacceptable
...
These instruments include self-regulation, the deployment of the contractual system within the DNS that
allows ICANN to ensure certain uniform rules with respect to domain name registries, registrars and
registrants, and the more traditional instrument of the treaty
...
Thus, the UDRP represents a deployment, through the contractual relations that make
up the ICANN system, of established rules relating to trademark protection that have been developed in
widely accepted treaties
...
The specific findings and recommendations made with respect to the various identifiers examined in this
Report are:
(i) For INNs, which are examined in Chapter Three of the Report, it is recommended that a simple
mechanism be established which would protect INNs against identical domain name registrations
...
(ii) For the names and acronyms of IGOs, which are examined in Chapter Four of the Report, it is
recommended that States, as the constituents of IGOs, should work towards the establishment of
an administrative dispute-resolution procedure, akin to the UDRP, where an IGO could bring a
complaint that a domain name was the same or confusingly similar to the name or acronym of the
IGO, that it has been registered without legal justification and that it likely to create a misleading
association between the holder of the domain name registration and the IGO in question
...
The sensitivities offended by the registration
of personal names as domain names by parties unconnected with the persons in question is
recognized, and it is suggested that the international community needs to decide whether it wishes
to work towards some means of protection of personal names against abuse of domain name
registrations
...
However,
these rules apply to trade in goods and may require some adaptation to deal with the perceived
range of problems with the misuse of geographical indications in the DNS
...
It is suggested that the international framework in this area needs to be further advanced before an
adequate solution is available to the misuse of geographical indications in the DNS
...
However, these areas are
not covered by existing international laws and a decision needs to be taken as to whether such laws
ought to be developed
...
It is recommended that no action be taken in this area
...
•
With the advent of WTO, the law of trade marks is now modernized under the Trade Marks Act of 1999
which provides for the registration of service marks and introduces various other provisions in conformity
with the Trade Mark Law in developed countries
...
•
Under the Act, Central Government appoints Controller-General of Patents, Designs, and Trade Marks, the
Registrar of Trade Marks for the purposes of the Trade Marks Act 1999
...
It is therefore important that the
rights holder applies for the registration of its mark as soon as possible
...
While registration of a trade mark is not compulsory, it offers better legal protection for an action for
infringement
•
The meaning of infringement has been enlarged as more actions shall be taken as constituting infringement
which are listed in Section 29
...
•
The Act contains provisions relating to registered users and empowers the Registrar to vary or cancel
registration as registered user on the grounds stipulated therein
...
To be registerable, the collective mark must be capable of being represented graphically and
meet other requirements as are applicable to registration of trade marks in general
...
•
The proprietor of a registered trade mark has to take some safeguards to protect his rights
...
If the trade mark is misused by others he should file a suit
for infringement and passing off and also take criminal action
...
An application for international registration (international
application) may be filed only by a natural person or legal entity having a connection, through
establishment, domicile or nationality, with a Contracting Party to the Agreement or the Protocol
...
146 PP-IPRL&P
SELF TEST QUESTIONS
1
...
2
...
Explain the following terms under the Trade Marks Act, 1999:(a) Well-known trade mark
(b) Certification trade mark
(c) Collective mark
(d) Permitted use
4
...
5
...
Discuss
...
What are the grounds for refusal of registration of a trade mark?
7
...
What remedies are available to the owner of the mark in the case of infringement of his trade mark?
9
...
Unlike the case with patents, copyright
•
Author & Ownership of Copyright
•
Term of Copyright
protects the expressions and not the ideas
...
•
Copyright Societies & Copyright Board
Just as you would want to protect anything that you
own, creators want to protect their works
...
of
Creativity being the keystone of progress, no civilized
society can afford to ignore the basic requirement of
encouraging the same
...
an atmosphere conducive to creativity, which induces
them to create more and motivates others to create
...
The objective of the study lesson is
to make them realize the ethical/moral aspects
involved in using materials protected by copyright,
besides increase their knowledge and understanding
of the copyright law as such, why copyright law exists
and where it all started and the key changes that
have occurred in the domain of copyright
...
This led to the
grant of privileges, by authorities and kings, entitling beneficiaries exclusive rights of reproduction and
distribution, for limited period, with remedies in the form of fines, seizure, confiscation of infringing copies and
possibly damages
...
In the 18th century there was dispute over the relationship between copyright subsisting in
common law and copyright under the Statute of Anne
...
This common law right
in unpublished works lasted until the Copyright Act, 1911, which abolished the Statute of Anne
...
Copyright as the name suggests
arose as an exclusive right of the author to copy the literature produced by him and stop others from doing
so
...
The concept of idea was originally
concerned with the field of literature and arts
...
Today, copyright law has extended protection not only
to literary, dramatic, musical and artistic works but also sound recordings, films, broadcasts, cable
programmes and typographical arrangements of publications
...
Copyright ensures certain minimum safeguards of the rights of authors over their creations, thereby
protecting and rewarding creativity
...
Economic and social development of a society is
dependent on creativity
...
In India, the law relating to copyright is governed by the Copyright Act, 1957 which has been amended in
1983, 1984, 1985, 1991, 1992, 1994, 1999 and 2012 to meet with the national and international
requirements
...
The philosophical
justification for including computer programs under literary work has been that computer programs are also
products of intellectual skill like any other literary work
...
The Amendment Act also
inserted new Section 40A empowering the Central Government to extend the provisions of the Copyright Act
to broadcasts and performances made in other countries subject to the condition however that such
countries extend similar protection to broadcasts and performances made in India
...
The Act is now amended in 2012 with the object of making certain changes for clarity, to remove operational
Lesson 8
Copyright 149
difficulties and also to address certain newer issues that have emerged in the context of digital technologies
and the Internet
...
MEANING OF COPYRIGHT AND THE RIGHTS CONFERRED
Copyright is a right given by the law to creators of literary, dramatic, musical and artistic works and producers
of cinematograph films and sound recordings
...
It means the sole right to
produce or reproduce the work or any substantial part thereof in any material form whatsoever (Kartar Singh
Giani v
...
Section 14 of the Act defines the term Copyright as to mean the exclusive right to do or authorise the doing
of the following acts in respect of a work or any substantial part thereof, namely
In the case of literary, dramatic or musical work (except computer programme):
(i) reproducing the work in any material form which includes storing of it in any medium by electronic
means;
(ii) issuing copies of the work to the public which are not already in circulation;
(iii) performing the work in public or communicating it to the public;
(iv) making any cinematograph film or sound recording in respect of the work;
making any translation or adaptation of the work
...
In the case of a computer programme:
(i) to do any of the acts specified in respect of a literary, dramatic or musical work; and
(ii) to sell or give on commercial rental or offer for sale or for commercial rental any copy of the
computer programme
...
In the case of an artistic work:
(i) reproducing the work in any material form including depiction in three dimensions of a two
dimensional work or in two dimensions of a three dimensional work;
(ii) communicating the work to the public;
(iii) issuing copies of work to the public which are not already in existence;
(iv) including work in any cinematograph film;
making adaptation of the work, and to do any of the above acts in relation to an adaptation of the work
...
In the case of a sound recording:
•
To make any other sound recording embodying it
•
To sell or give on hire, or offer for sale or hire, any copy of the sound recording
•
To communicate the sound recording to the public
...
Further, it wants to discourage the dishonest manufacturers from enchasing the goodwill of the
owner of the copyright, who has established itself in the market with its own efforts [Hawkins Cookers Ltd
...
Magicook Appliances Co
...
Unlike the case with patents, copyright protects the expressions and not the ideas
...
In M/s Mishra Bandhu Karyalaya & Others v
...
It is
always possible to arrive at the same result from independent sources
...
Whether one book is a copy of the other or not, it was held in S K Dutt
...
Law Book Co
...
By external
features means the get-up and the ‘overall’ scope of the publication
...
Works in Which Copyright Subsists
Section 13 of the Copyright Act provides that copyright shall subsist throughout India in certain classes of
works which are enumerated in the section
...
In Macmillan and Company Limited v
...
and J
...
Copyright Acts are not
concerned with the origin of ideas, but with the expression of thought; and in the case of ‘literary work, with
the expression of thought in print or writing
...
What is the precise
amount of the knowledge, labour, judgement or literary skill or taste which the author of any book or other
compilation must bestow upon its composition in order to acquire copyright in it within the meaning of the
Lesson 8
Copyright 151
Copyright Act cannot be defined in precise terms
...
In Camlin Private Limited v
...
But it is not necessary that the work should be the expression of the
original or inventive thought, for Copyright Act are not concerned with the originality of ideas, but with the
expression of thought, and in the case of a literary work, with the expression of thought in print or writing
...
The essential requirement is that the work must not be copied from another work but
must originate from the author
...
Word “artistic” is merely used as a generic term to include the different processes of creating works set out in
the definition section and that provides that a work produced by one such processes, and that its creation
involved some skill or labour on the part of the artist, it is protected [Associated Publishers (Madras) Ltd
...
K
...
114 (1962) 1 Mad LJ 258]
...
It is not originality of idea or the
theme behind the work but the expression of the work which requires to be original
...
What is prevented under the Copyright Act is making of
copies without permission of the author
...
Kothari Hosery Factory 2002 PTC (24) 756
Del
...
"Musical work" means a work consisting of music and includes any graphical notation of such work but does
not include any words or any action intended to be sung, spoken or performed with the music
...
"Sound recording" means a recording of sounds from which sounds may be produced regardless of the
medium on which such recording is made or the method by which the sounds are produced
...
"Cinematograph film" means any work of visual recording on any medium produced through a process from
which a moving image may be produced by any means and includes a sound recording accompanying such
visual recording and "cinematograph" shall be construed as including any work produced by any process
analogous to cinematography including video films
...
Entertaining Enterprises & Others v
...
278
...
Dev Anand & Another AIR 1979 Bom
...
152 PP-IPRL&P
COPYRIGHT PERTAINING TO SOFTWARE
The definition of ”Literary wok” under section 2 (o) of the Copy right Act,1957 includes computer
programmes, tables and compilations including computer "literary data bases
...
Computer programmes (also known as "software") originated with the invention of the computer itself
...
In the initial stages,
computer programmes were developed by the manufacturers of computers themselves
...
Development
and manufacturing of software has now become an independent activity and the number of companies
engaged in this activity has also increased
...
While vigorous competition among
producers of software has, on the one hand brought about improvement in the quality of computer
programmes and brought down the prices, the increased opportunities have also given rise to what is
commonly known as "software piracy'' - the activity of duplicating and distributing software without authority
from the holder of the copyright
...
Developing
a computer programme is an activity which is comparable to the writing of a novel or other literary work
excepting that the "language" used as well as its uses are of a very different kind
...
Like the unauthorised copying of literary works, unauthorised copying of computer programmes also attracts
the same legal consequences under the Copyright law
...
Software piracy has assumed enormous proportions in certain countries and has become a friction point in
international trade negotiations
...
The Copyright (Amendment) Act, 1994 has tried to address these
questions and has incorporated internationally recognised standards and procedures for enforcement of
copyright in the field of computer programmes
...
e
...
Generally the author is the first
owner of copyright in a work
...
e
...
•
In the case of a musical work, the composer
...
•
In the case of a sound recording, the producer
...
•
In the case of any literary, dramatic, musical or artistic work which is computer-generated, the
person who causes the work to be created
...
For example, the lyricist who wrote the lyrics, the
composer who set the music, the singer who sang the song, the musician (s) who performed the background
music, and the person or company who produced the sound recording
...
It is necessary to obtain the licences from each and
every right owner in the sound recording
...
In the case of a government work, government shall, in the absence of any agreement to the contrary, be the
first owner of the copyright therein
...
In the case of a literary, dramatic or artistic work made by the author in the course of his employment by the
proprietor of a newspaper, magazine or similar periodical under a contract of service or apprenticeship, for
the purpose of publication in a newspaper, magazine or similar periodical, the said proprietor shall, in the
absence of any agreement to the contrary, be the first owner of the copyright in the work in so far as the
copyright relates to the publication of the work in any newspaper, magazine or similar periodical, or to the
reproduction of the work for the purpose of its being so published, but in all other respects the author shall be
the first owner of the copyright in the work
...
In the case of a photograph taken, or a painting or portrait drawn, or an engraving or a cinematograph film
made, for valuable consideration at the instance of any person, such person shall, in the absence of any
agreement to the contrary, be the first owner of the copyright therein
...
Literary, dramatic, musical or artistic works enjoy copyright protection for the life time of the author plus 60
years beyond i
...
60 years after his death
...
In the case of copyright in posthumous, anonymous and pseudonymous works, photographs, cinematograph
films, sound recordings, works of Government, public undertaking and international organisations, the term
of protection is 60 years from the beginning of the calendar year next following the year in which the work
has been first published
...
This right is to be enjoyed by every broadcasting
organisation for a period of twenty-five years from the beginning of the calendar year next following the year
in which the broadcast is made
...
COPYRIGHT OFFICE
Section 9 of the Copyright Act requires for establishment of an office to be called the Copyright Office for the
purpose of the Act
...
Copyright Board
Section 11 of the Act provides for the establishment of the Copyright Board and empowers the Central
Government to constitute the same consisting of a Chairman and not less than two, but not more than
fourteen members
...
The Registrar of Copyright to act as Secretary of the
Copyright Board
...
Settlement of disputes as to whether copies of any literary, dramatic or artistic work or records are
issued to the public in sufficient numbers
...
Settlement of disputes as to whether the term of copyright for any work is shorter in any other
country than that provided for that work under the Act
...
Settlement of disputes with respect to assignment of copyright as dealt with in Section 19A
...
Granting of compulsory licences in respect of Indian works withheld from public
...
Granting of compulsory licence to publish unpublished Indian works
...
Granting of compulsory licence to produce and publish translation of literary and dramatic works
...
Granting of compulsory licence to reproduce and publish literary, scientific or artistic works for
certain purposes
...
Determination of royalties payable to the owner of copyright
...
Determination of objection lodged by any person as to the fees charged by Performing Rights
Societies
...
Rectification of Register on the application of the Registrar of Copyright or of any person aggrieved
...
The appeal
against orders passed by the Copyright Board except under Section 6 lies to the High Court within whose
jurisdiction the appellant resides or carries on business
...
Shri Charushila Sharan Gupta and Sumitra Nandand Gupta 1983 PTC 84
...
Assignment of Copyright
The owner of the copyright in an existing work or the prospective owner of the copyright in a future work may
assign to any person the copyright Section 18 of the Copyright Act provides for the assignment of copyright
in an existing work as well as future work
...
However, in case of assignment of copyright in any future work, the assignment has the real
effect only when the work comes into existence
...
Sections 17 and 18 of the Copyright Act, 1957 show where the copyright vests
...
It can be legitimately said that this
Section has been inserted in the Act of 1957, but the rule of law has been same even prior to this statutory
provision
...
(Khemraj Shrikrishnadass v
...
and Another AIR 1975 Del 130
...
Mere acceptance of remuneration or delivery of manuscript does not constitute an assignment
of copyright
...
Setty v
...
Suryakantha U
...
A
...
Dr
...
Kamath AIR 1992 Kar 1
...
Srimagal and Co
...
Books (India) Pvt
...
& Others AIR 1973
Mad 49: (1972) 2 Mad LJ 610
...
So it should be clear that
the transfer of the material object does not necessarily involve a transfer of the copyright
...
However, in the absence of duration and territorial extent, the assignment remains valid
for a period of five years and within the territory of India
...
The assignment of copyright in any work contrary to the terms and conditions of the rights already assigned
to a copyright society in which the author of the work is a member is void
...
The assignment of the copyright in any work to make a sound recording which does not form part of any
156 PP-IPRL&P
cinematograph film does not affect the right of the author of the work to claim an equal share of royalties and
consideration payable for any utilization of such work in any form
...
Section 30 deals with licences by owners of
copyright; Section 30A contains provisions regarding application of Sections 19 and 19A; Section 31
provides for compulsory licence in works withheld from public; Section 31A deals with compulsory licences in
unpublished Indian works; Section 31B deals with Compulsory Licence for the benefit of disabled; Section
31C deals with statutory licence for cover versions; Section 31D deals with statutory licence for broadcasting
of literary and musical works and sound recording; Section 32 deals with licences to produce and publish
translations; Section 32A provides for licence to reproduce and publish works for certain purposes; and
Section 32B deals with termination of licences
...
However, in the case of a licence relating to copyright in any future work, the licence shall
take effect only when the work comes into existence
...
Compulsory Licence in Works Withheld from Public
Section 31 provides that if at any time during the term of copyright in any Indian work which has been
published or performed in public, a complaint is made to the Copyright Board that the owner of copyright in
the work has refused to re-publish or allow the re-publication of the work or has refused to allow the
performance in public of the work, and by reason of such refusal the work is withheld from the public or has
refused to allow communication to the public by broadcast of such work or in the case of a sound recording;
the work recorded in such sound recording, on terms which the complainant considers reasonable, the
Copyright Board, after giving to the owner of the copyright in the work a reasonable opportunity of being
heard and after holding such inquiry as it may deem necessary, may, if it is satisfied that the grounds for
such refusal are not reasonable, direct the Registrar of Copyrights to grant to the complainant a licence to
republish the work, perform the work in public or communicate the work to the public by broadcast, subject to
payment to the owner of the copyright of such compensation and subject to such other terms and conditions
as the Copyright Board may determine
...
Before making an application to the Copyright Board , the applicant required to publish his proposal in one
issue of a daily newspaper in the English language having circulation in the major part of the country and
where the application is for the publication of a translation in any language, also in one issue of any daily
newspaper in that language
...
Compulsory Licence for Benefit of Disabled
Section 31B (1) provides that any person working for the benefit of persons with disability on a profit basis or
for business may apply to the Copyright Board in prescribed manner for a compulsory licence to publish any
work in which copyright subsists for the benefit of such persons, in a case to which clause (zb) of sub-section
(1) of Section 52 does not apply and the Copyright Board shall dispose of such application as expeditiously
as possible and endeavour shall be made to dispose of such application within a period of two months from
the date of receipt of the application
...
It may be noted that clause (zb) of sub-section (1) of Section 52 provides that the adaptation, reproduction,
issue of copies or communication to the public of any work in any accessible format, by—
(i) any person to facilitate persons with disability to access to works including sharing with any person
with disability of such accessible format for private or personal use, educational purpose or
research; or
(ii) any organisation working for the benefit of the persons with disabilities in case the normal format
prevents the enjoyment of such works by such persons:
However, the copies of the works in such accessible format are made available to the persons with
disabilities on a non-profit basis but to recover only the cost of production and the organization ensure that
the copies of works in such accessible format are used only by persons with disabilities and takes
reasonable steps to prevent its entry into ordinary channels of business
...
”
Statutory Licence for Cover Versions
Section 31C (1) provides that any person desirous of making a cover version, being a sound recording in
respect of any literary, dramatic or musical work, where sound recordings of that work have been made by or
with the licence or consent of the owner of the right in the work, may do so subject to the provisions of this
section
...
The person making the sound recordings required to give prior notice of his intention to make the sound
recordings in the manner as may be prescribed, and provide in advance copies of all covers or labels with
which the sound recordings are to be sold, and pay in advance, to the owner of rights in each work royalties
in respect of all copies to be made by him, at the rate fixed by the Copyright Board
...
The person making such sound recordings shall not make any alteration in the literary or musical work which
has not been made previously by or with the consent of the owner of rights, or which is not technically
necessary for the purpose of making the sound recordings
...
It may be noted that cover version means a sound recording made in accordance with this Section 31C of
the Act
...
The broadcasting organisation required to give prior notice in prescribed manner of its intention to broadcast
the work stating the duration and territorial coverage of the broadcast, and pay to the owner of rights in each
work royalties in the manner and at the rate fixed by the Copyright Board
...
The broadcasting organisation required to maintain such records and books of account, and render to the
owners of rights such reports and accounts; and allow the owner of rights or his duly authorised agent or
representative to inspect all records and books of account relating to such broadcast in prescribed manner
...
However, in respect of teaching, scholarship or research Section 32(1A) allows any
person to apply to the Copyright Board for a licence to produce and publish a translation, in printed or
analogous forms of reproduction, of a literary or dramatic work, other than an Indian work, in any language in
general use in India after a period of three years from the first publication of such work
...
Termination of Licence
Section 32B of the Act deals with termination of licences and provides that if at any time after the granting of
a licence, the owner of the copyright in the work or any person authorised by him publishes a translation of
such work in the same language and which is substantially the same in content at a price reasonably related
to the price normally charged in India for the translation of works of the same standard on the same or similar
subject, the licence so granted shall be terminated
...
Copyright Societies
The Copyright (Amendment) Act, 1994 added a new Chapter VII on Copyright Societies
...
The
aforesaid restriction is not applicable to Copyright Societies registered under Section 33(3) of the Copyright
Act
...
However, an owner of copyright in his individual capacity continues to have the right to grant licences in
respect of his own works consistent with his obligations as a member of the registered Copyright society
...
The Central Government has been empowered to cancel the registration of a Copyright Society if its
management is detrimental to the interests of the owners of rights concerned
...
Administration of Rights of Owner by Copyright Society
Section 34 of the Act empowers a Copyright Society to accept exclusive authorisation from an owner of
Copyright to administer any right in any work by issuing licences or collection of licence fee or both
...
A Copyright Society is competent to enter into agreement with any foreign society or organisation,
administering rights corresponding to rights under the Indian Copyright Act, to entrust such foreign society or
organisations the administration in any foreign country of rights administered by the said Copyright Society in
India or for administering in India the rights administered in a foreign country by such foreign society or
organisation
...
Section 35 deals with control over the society by the owner of rights and provides that every Copyright
160 PP-IPRL&P
Society is subject to the collective control of the copyright owners whose rights it administers
...
Rights of Broadcasting Organisation and Performers
Chapter VIII of the Act containing Section 37-39A deals with rights of broadcasting organisations and of
performers
...
As per sub Section (3) of Section 37 during the continuance of a broadcast reproduction right in relation to
any broadcast, any person who, without the licence of the owner of the right does any of the following acts of
the broadcast or any substantial part thereof,(a) re-broadcasts the broadcast; or
(b) causes the broadcast to be heard or seen by the public on payment of any charges; or
(c) makes any sound recording or visual recording of the broadcast; or
(d) makes any reproduction of such sound recording or visual recording where such initial recording
was done without licence or, where it was licensed, for any purpose not envisaged by such licence;
or
(e) sells or gives on commercial rental or offer for sale or for such rental, any such sound recording or
visual recording referred to in clause (c) or clause (d) and subject to the provisions of Section 39
deemed to have infringed broadcast reproduction right
...
The performer's right
subsist until fifty years from the beginning of the calendar year next following the year in which the
performance is made
...
It may be noted that once a performer has, by written agreement, consented to the incorporation of his
performance in a cinematograph film he shall not, in the absence of any contract to the contrary, object to the
enjoyment by the producer of the film of the performer’s right in the same film
...
Moral Right of Performer
Section 38B of Act provides that the performer of a performance shall, independently of his right after
assignment, either wholly or partially of his right, have the right to claim to be identified as the performer of
his performance except where omission is dictated by the manner of the use of the performance; and to
restrain or claim damages in respect of any distortion, mutilation or other modification of his performance that
would be prejudicial to his reputation
...
Acts not Constituting Infringement of Broadcast Reproduction Right and Performers Right
Section 39 stipulates situations in which no broadcast reproduction right or performer’s right shall be deemed
to be infringed
...
International Copyright
Copyright Protection to Foreign Works
The Copyright Act applies only to works first published in India, irrespective of the nationality of the author
...
The benefits granted to foreign works will
not extend beyond what is available to the works in the home country and that too on a reciprocal basis i
...
the foreign country must grant similar protection to works entitled to copyright under the Act
...
Government of India has passed the International Copyright Order, 1958
...
Conditions of Copyright Protection
The following are the requisites for conferring copyright protection to works of international organisations:
(a) The work must be made or first published by or under the direction or control of the International
Organisation
...
(c) If the work is published in pursuance of an agreement with the author, such agreement should not
reserve the author any copyright in the work or any copyright in the work should belong to the
organisation
...
Section 40A (2) also provides that the order so made by the Central Government may provide that:
(i) the provisions of Chapter VIII shall apply either generally or in relation to such class or classes of
broadcasts or performance or such other class or classes of cases as may be specified in the order;
(ii) the term of the rights of broadcasting organisations and performers in India shall not exceed such
term as is conferred by the law of the country to which the order relates;
(iii) the enjoyment of the rights conferred by Chapter VIII shall be subject to the accomplishment of such
conditions and formalities, if any, as may be specified in that order;
(iv) chapter VIII or any part thereof shall not apply to broadcast and performances made before the
commencement of the order or that Chapter VIII or any part thereof shall not apply to broadcasts
and performances broadcast or performed before the commencement of the order;
(v) in case of ownership of rights of broadcasting organisations and performers, the provisions of
Chapter VIII shall apply with such exceptions and modifications as the Central Government, may
having regard to the law of the foreign country, consider necessary
...
Registration of Copyright
Chapter X of the Act containing Sections 44 to 50A deal with various aspects of registration of copyright
...
It is evident from
the provisions of the aforesaid section that registration of the work under the Copyright Act is not compulsory
and is not a condition precedent for maintaining a suit for damages, if somebody infringes the copyright
...
Anan Kumar
& Others AIR 1981 All 200)
...
Madhavan v
...
The only effect of registration is
what is stated in Section 48, to wit, that it shall be prima facie evidence of the particulars entered in the
register
...
There is no section in the Copyright Act, 1957, to the effect that the author can have no right or remedy
unless the work is registered
...
Kiron Chandra Mukhopadhyay & Others AIR 1972 Cal
533
...
Munoth and Ors
...
M
...
The Court held that registration of copyright was not a precondition for filing a suit or for launching prosecution for violation of copyright
...
The Register of Copyrights is
to be kept in six parts, namely, Part I Literary works other than computer programmes, tables and
compilations including computer data bases and dramatic works; Part II Musical works; Part III Artistic works;
Part IV Cinematograph films; Part V Sound Recording; and Part VI Computer programmes, tables and
compilations including computer data bases
...
Copies of the Act and Rules can be obtained from the Manager of Publications, Publication Branch, Civil
Lines, Delhi or his authorised dealers on payment
...
The Power of Attorney signed by the
party and accepted by the advocate should also be enclosed
...
Both published and unpublished works can be registered
...
e
...
Three copies of published work may be sent along with the application
...
In case two copies of the
manuscript are sent, one copy of the same duly stamped will be returned, while the other will be retained, as
far as possible, in the Copyright Office for record and will be kept confidential
...
When a work has been registered as unpublished and subsequently it is published, the applicant may apply
for changes in particulars entered in the Register of Copyright in Form V with prescribed fee
...
If any person without authorisation from the owner
exercises these rights in respect of the work which has copyright protection it constitutes an infringement of
the copyright
...
, England v
...
29, it was observed
that whenever there is misappropriation of intellectual property of which the primary beneficiary is the
copyright owner there is infringement of copyright
...
Throughout the world it is
regarded as a form of property worthy of special protection in the ultimate public interest
...
Section 51 of the Act contemplates situations where copyright in a work shall be deemed to be infringed
...
(3) when any person (i) makes for sale or hire or lets for hire or by way of trade display or offers for sale
or hire, or (ii) distributes either for the purpose of trade or to such an extent as to affect prejudicially
the owner of the copyright, or (iii) by way of trade, exhibits in public, or (iv) imports into India any
infringing copies of the work
...
Explanation
to Section 51 clarifies that the reproduction of literary, dramatic, musical or artistic work in the form of
cinematograph film shall be deemed to be an infringing copy
...
Kartar
Singh Giani v
...
The concept of honest and concurrent user found in Section 12(3) of the 1958 Act for securing concurrent
registration is totally irrelevant as defence in a suit for infringement and copyright arising out of a different
Act, namely, 1957 Act (M/s Power Control Appliances & Others v
...
Ltd
...
In Ushodaya Enterprises Ltd v T
...
Venugopal, 2001 PTC 727, the division bench of the Andhra Pradesh
High Court held that even though the defendant has registered the carton under the Trademark Act, that may
not come to the aid of the defendant as the case of the plaintiff is that it owns a copyright of the artistic work
under the Copyright Act and no registration is required for the same
...
One of the surest test to determine whether or not there has been a violation of copy right is to see if the
reader, spectator, or the viewer after having read or seen both the works would be clearly of the opinion and
get an unmistakable impression that the subsequent work appears to be a copy of the first
...
, `lay observer test’ whether to persons who are not experts in relation to objects of
that description, the object appears to be a reproduction
...
A bare look at these two artistic
works `Sharp’ and `Sharp tools’
...
Judging by the eye alone, they appear to Court to be
totally different
...
Applying the various tests set out above, it cannot be said that the respondent had committed an act of
piracy by way of copying the copyright of the appellant
...
[Associated Electronic & Electrical
Industries (Bangalore) Pvt
...
v
...
M/s
...
M/s
...
CR 782
...
The
plaintiff was assigned video playback and cable T
...
The Court observed that there were various modes of communication to public
and each one was separate and divisible
...
The Bombay High Court in Hindustan Lever Ltd
...
Nirma Private Limited, Ahmedabad, AIR 1991 held that
the dissimilarities were totally inadequate to wipe out general impression of the unwary purchaser
...
The case dealt with the infringement of the copyright in the
label when there were only few changes made in the colourable imitation of label
...
Navin J
...
, Delhi High Court
has held:
166 PP-IPRL&P
Copyright is a limited monopoly having its origin in protection
...
Others are at liberty to use the same material
...
Every man can take what is useful from the,
improve, add and give to the public the whole comprising the original work with his additions and
improvements
...
Judgements/orders published by the plaintiffs in their law
reports ‘Supreme Court Cases’ is not their original literary work but has been composed of, complied and
prepared from and reproduction of the judgements of the Supreme Court of India, open to all
...
Plaintiffs, therefore, have no copyright in the judgements published in
their law reports
...
Plaintiffs have failed to make out any prima facie case in their favour and are,
therefore, not entitled to any relief in the application
...
v
...
2001 PTC (21) 407 Del
...
Crowning Glory carton was designed for valuable consideration by a person who produced the said work in
the course of his employment with advertising company under a contract of service for and on behalf of the
plaintiff
...
As a matter of abundant caution the copyright in the
carton was assigned to the plaintiff
...
The object of these exceptions
is to enable the reproduction of the work for certain public purposes, and for encouragement of private study,
research and promotion of education
...
These include
(i) A fair dealing with literary, dramatic, musical or artistic work, not being a computer programme, for the
purposes of-—
•
private or personal use, including research;
•
criticism or review, whether of that work or of any other work;
•
reporting of current events and current affairs, including the reporting of a lecture delivered in
public
...
(ii) The making of copies or adaptation of a computer programme by the lawful possessor of a copy of such
computer programme, from such copy in order to utilise the computer programme for the purposes for which
it was supplied; or to make back-up copies purely as a temporary protection against loss, destruction or
damage in order only to utilise the computer programme for the purpose for which it was supplied
...
(iv) the observation, study or test of functioning of the computer programme in order to determine the ideas
and principles which underline any elements of the programme while performing such acts necessary for the
functions for which the computer programme was supplied
...
(vi) the transient or incidental storage of a work or performance purely in the technical process of electronic
transmission or communication to the public
...
It may be noted that if the person responsible for the storage of the copy has received a written complaint
from the owner of copyright in the work, complaining that such transient or incidental storage is an
infringement, such person responsible for the storage shall refrain from facilitating such access for a period
of twenty-one days or till he receives an order from the competent court refraining from facilitating access
and in case no such order is received before the expiry of such period of twenty-one days, he may continue
to provide the facility of such access
...
(ix) the reproduction or publication of any work prepared by the Secretariat of a Legislature or, where the
Legislature consists of two Houses, by the Secretariat of either House of the Legislature, exclusively for the
use of the members of that Legislature
...
(xii) the publication in a collection, mainly composed of non-copyright matter, bona fide intended for
instructional use, and so described in the title and in any advertisement issued by or on behalf of the
publisher, of short passages from published literary or dramatic works, not themselves published for such
use in which copyright subsists
...
In the case of a work of joint authorship, references in this clause to passages from works shall include
references to passages from works by any one or more of the authors of those passages or by any one or
more of those authors in collaboration with any other person
...
168 PP-IPRL&P
(xiv) the performance, in the course of the activities of an educational institution, of a literary, dramatic or
musical work by the staff and students of the institution, or of a cinematograph film or a sound recording if
the audience is limited to such staff and students, the parents and guardians of the students and persons
connected with the activities of the institution or the communication to such an audience of a cinematograph
film or sound recording
...
(xvi) the performance of a literary, dramatic or musical work by an amateur club or society, if the
performance is given to a non-paying audience, or for the benefit of a religious institution
...
(xviii) the storing of a work in any medium by electronic means by a noncommercial public library, for
preservation if the library already possesses a non-digital copy of the work
...
However, where the identity of the author of any such work or, in the case of a work of joint authorship, of
any of the authors is known to the library, museum or other institution, as the case may be, the provisions of
this clause shall apply only if such reproduction is made at a time more than sixty years from the date of the
death of the author or, in the case of a work of joint authorship, from the death of the author whose identity is
known or, if the identity of more authors than one is known from the death of such of those authors who dies
last;
(xxi) the reproduction or publication of•
any matter which has been published in any Official Gazette except an Act of a Legislature;
•
any Act of a Legislature subject to the condition that such Act is reproduced or published
together with any commentary thereon or any other original matter;
•
the report of any committee, commission, council, board or other like body appointed by the
Government if such report has been laid on the Table of the Legislature, unless the reproduction
or publication of such report is prohibited by the Government;
•
any judgement or order of a court, tribunal or other judicial authority, unless the reproduction or
Lesson 8
Copyright 169
publication of such judgment or order is prohibited by the court, the tribunal or other judicial
authority, as the case may be
...
(xxiii) the making or publishing of a painting, drawing, engraving or photograph of a work of architecture or
the display of a work of architecture
...
(xxv) the inclusion in a cinematograph film of•
any artistic work permanently situate in a public place or any premises to which the public has
access; or
•
any other artistic work, if such inclusion is only by way of background or is otherwise incidental to
the principal matters represented in the film
...
However, he does not thereby repeat or imitate the main design of the work
...
However, the original construction
was made with the consent or licence of the owner of the copyright in such drawings and plans
...
However,
the provisions of sub-clause (ii) of clause (a), sub-clause (a) of clause (b) and clauses (d), (f), (g), (m) and (p)
shall not apply as respects any act unless that act is accompanied by an acknowledgment•
identifying the work by its title or other description; and
•
unless the work is anonymous or the author of the work has previously agreed or required that
no acknowledgement of his name should be made, also identifying the author
...
(xxxi) the performance of a literary, dramatic or musical work or the communication to the public of such work
170 PP-IPRL&P
or of a sound recording in the course of any bona fide religious ceremony or an official ceremony held by the
Central Government or the State Government or any local authority
...
“(xxxii) the adaptation, reproduction, issue of copies or communication to the public of any work in any
accessible format by any person to facilitate persons with disability to access to works including sharing with
any person with disability of such accessible format for private or personal use, educational purpose or
research; or any organisation working for the benefit of the persons with disabilities in case the normal format
prevents the enjoyment of such works by such persons
...
It may be noted that “any organization” includes and organization registered under Section 12A of the
Income-tax Act, 1961 and working for the benefit of persons with disability or recognized under Chapter X of
the Persons with Disabilities (Equal Opportunities, Protection or Rights and full Participation) Act, 1995 or
receiving grants from the government for facilitating access to persons with disabilities or an educational
institution or library or archives recognized by the Government
...
Remedies against Infringement of Copyright
Protection of rights under the copyright law, which is basically a negative right is as much a problem of
complying with the mandatory provisions of the procedural law as the effective exercise of investigative and
adjudicatory functions by the enforcing authorities and the courts
...
Section 55 provides
that where copyright in any work has been infringed, the owner of the copyright can, except as otherwise
provided in the Act, be entitled to all remedies like injunctions, damages and accounts as are conferred by
law for the infringement of a right
...
In Zee Telefilm Limited v
...
there was a dispute relating to
transfer of copyright in TV serial ‘India’s Most Wanted’
...
The assignment agreement executed between the
plaintiff and the defendants as regards structure, format, concept, synopsis and script vague and uncertain,
the plaintiffs are not entitled to any interim relief
...
v
...
, 100(2002) DLT698 discussed the grant of
permanent injunction to the plaintiff for restraining the defendant from using a label for pressure cookers,
which was deceptively similar to the registered trade mark ‘HAWKINS’ of the plaintiff – On non-appearance
of the plaintiff, an ex-parte order was passed and it was ruled that, the unjust enrichment by the infringing
party, was a mischief and the plaintiff was to be protected from it as per Section 55 of the Copyright Act,
1957
...
Lesson 8
Copyright 171
In any civil proceedings under the Copyright Act for infringement of copyright, it is the District Court which will
have jurisdiction over such matters
...
Administrative remedies consist of moving the Registrar of Copyrights under Section 53 to ban the import of
infringing copies into India and the delivery of infringing copies confiscated to the owner of the copyright
...
Prior to the maximum
punishment for infringement of copyright under Section 63 of the Copyright Act, 1957 was one year's
imprisonment and fine
...
Under these provisions, a person
who knowingly infringes or abets the infringement of copyright in a work or any other right conferred by the
Copyright Act, is punishable with imprisonment for a term of not less than six months but which may extend
to three years and fine which shall not be less than ` 50,000/-, but which may extend to ` 2
...
However, the court has the discretion to reduce the minimum ter n of imprisonment and the minimum fine for
adequate and special reasons
...
The amendment in 1994,
has further restricted the discretion of the court to impose lesser penalties than the minimum prescribed in
the Act
...
In other
words, courts have been given a discretion to impose a lesser penalty where the infringement is of a
technical nature and not motivated by business considerations
...
In Rupendra Kashyap v
...
, it was held that CBSE is a public undertaking; examination papers are literary work made
under the direction and control of CBSE and applicability of Section 17(dd) of Copyright Act is squarely
attracted to the facts of the case
...
In another case Allahabad high Court has held that the copyright in the question papers set for the High
School and Intermediate examinations belongs to the paper-setters and since this copyright neither belonged
to nor has been assigned to the Board, the notification which declares that ‘copyright of the question papers
set at the examinations conducted by Board shall vest in the Board’ is clearly bad
...
Board of High School and Intermediate Education & Another AIR
91: 1996 All LJ 550)
...
In this context, the section clarifies that all infringing copies of any work
in which copyright subsists and all plates used or intended to be used for the production of such infringing
copies shall be deemed to be the property of the owner of the copyright
...
Under Section 57 of the Act an author of copyright work can
172 PP-IPRL&P
restrain or claim damages in respect of any distortion or mutilation of the work or any other action in relation
to the said work which would be prejudicial to his honour or reputation
...
They can be enforced by an action for breach of contract or
confidence, a suit for defamation, or passing off, as the case may be
...
The first use of such order was made by Templeman J, in EMI v
...
However, it was only after the case of Anton Piller KG v
...
418, that it gained recognition and popularity
...
stipulate the rights that
are available to the intellectual property owner, besides containing a sound mechanism to prevent the
infringement of intellectual property rights
...
The orders in line of Anton Piller order are made under the head of civil remedies
...
There is not much case-laws debating over the aspects of
Anton Piller order
...
National Apparels,(1990) PTC98
...
v
...
Pvt
...
, 2005(30) PTC 279, the court observed
that an Anton Piller order can be passed in the following situations:
•
Where the plaintiff has an extremely strongly prima facie case;
•
Where the actual or potential damage to the plaintiff is very serious
...
The purpose of Anton Piller order is the preservation of evidences
...
APPEALS
An appeal under the the Copyright Act, 1957 lies against (a) certain orders of magistrate & (b) against orders
of Registrar of Copyrights and Copyright Board:As per Section 71 of the Act any person aggrieved by an order under sub-section (2) of Section 64 or
Section 66 may, within thirty days of the date of such order, appeal to the court to which appeals from the
court making the order ordinarily lie, and such appellate court may direct that execution of the order be
stayed pending disposal of the appeal
...
Lesson 8
Copyright 173
Any person aggrieved by any final decision or order of the Copyright Board, not being a decision or order
made in an appeal under sub-section (1), may, within three months from the date of such decision or order,
appeal to the High Court within whose jurisdiction the appellant actually and voluntarily resides or carries on
business or personally works for gain :
However, no such appeal shall lie against a decision of the Copyright Board under Section 6
...
A country joining the Convention has to provide
copyright protection to literary and artistic works of member countries in its own territory and also entitled for
enjoying reciprocal protection from others
...
Among these, the 1971 revision (the Paris Act) is of particular importance to the developing
countries as it provided special concessions to these countries in making translations and reproduction of
foreign literary works for educational purposes
...
The post Second World War era saw the emergence of the need for protecting copyright on an universal
basis
...
In August, 1952 the Intergovernmental Copyright Conference was convened in Geneva which led to the
adoption of another historical copyright convention, namely the Universal Copyright Convention (UCC)
...
Rather it tried to establish the link between the countries
on the Bern Union and those in North America
...
TRIPS Agreement negotiated at the Uruguay Round of General Agreement on Tariffs and Trade (GATT) in
1994 came into effect on 1 January 1995
...
The standards for specific IPRs such as copyright and related rights are discussed under articles 9-14
...
•
Copyright is a right given by the law to creators of literary, dramatic, musical and artistic works and
producers of cinematograph films and sound recordings
...
•
In India, the law relating to copyright is governed by the Copyright Act, 1957 which has been amended in
1983, 1984, 1985, 1991, 1992, 1994, 1999 and 2012 to meet with the national and international
requirements
•
Under the Copyright Act, 1957 copyright subsists throughout India in the following classes of works:
Original literary; dramatic, Musical and artistic works; Cinematograph films; and Sound recordings
...
•
Literary, dramatic, musical or artistic works enjoy copyright protection for the life time of the author plus 60
174 PP-IPRL&P
years beyond i
...
60 years after his death
...
•
The Act provides for the establishment of the Copyright Board and empowers the Central Government to
constitute the same consisting of a Chairman and not less than two, but not more than fourteen members
...
•
An assignment of copyright should be in writing signed by the owner of the copyright
...
•
Central Government has been authorised to register association of persons as copyright society
...
The Act empowers a Copyright Society to accept exclusive authorisation from an owner of
Copyright to administer any right in any work by issuing licences or collection of licence fee or both
...
The Act entitles every
broadcasting organisation to have a special right to be known as "broadcast reproduction right" in respect
of its broadcasts for twenty-five years from the beginning of the calendar year next following the year in
which the broadcast is made
...
However the Act empowers the Government of India to extend the benefits of all or any of the provisions of
the Act to works first published in any foreign country
...
According to this order any work
first published in any country which is a member of the Berne Convention or the Universal Copyright
Convention will be accorded the same treatment as if it was first published in India
...
•
Act contemplates situations where copyright in a work is deemed to be infringed and provides for civil
remedies, administrative remedies and criminal to the owner of the copyright in the event of infringement
...
•
Besides traditional remedies, the non-traditional forms of remedies like, Anton Pillar Order, interlocutory
injunction, etc, have assumed more popularity nowadays
...
Briefly explain the term “copyright” and the rights conferred by the copyright
...
There is no copyright in an idea
...
3
...
Discuss
Lesson 8
Copyright 175
4
...
How an author has been defined under the Copyright Act?
5
...
Briefly explain the procedure relating to registration of copyright
...
What do you mean by performer’s right? What are the exclusive rights of a performer under the
Copyright Act?
8
...
9
...
Can copyright be assigned? If so, what is the mode of assigning copyright?
176 PP-IPRL&P
Lesson 9
INDUSTRIAL DESIGNS
LESSON OUTLINE
LEARNING OBJECTIVES
Industrial design play an important role in the trading
of consumer goods or products
...
Today, industrial
design has become an integral part of consumer
•
Procedure for Registration
•
Period of Protection
•
Procedure for Cancellation of Design
•
Copyright under Design
•
Piracy and Penalties
•
Assignment of Designs
•
Lesson Round Up
•
Self Test Questions
culture where rival articles compete for consumer's
attention
...
When an industrial design is protected, this helps to
ensure a fair return on investment
...
That apart, protecting industrial designs helps
economic development, by encouraging creativity in
the industrial and manufacturing sectors and
contributes to the expansion of commercial activities
and the export of national products
...
Besides, they should be well versed with the
application filing procedure as required under the
law
...
An industrial design is the ornamental or aesthetic aspect of a
useful article, which must appeal to the sense of sight and may consist of the shape and/or pattern and/or
colour of article
...
Industrial designs are
protected against unauthorised copying or imitation, for a period which usually lasts for five, ten or 15 years
...
As early as in 1787 the first Act for design protection
was enacted in Great Britain for the encouragement of the arts of design
...
Shortly thereafter its life was extended and it was made
perpetual
...
In the same year another Act was passed for design protection for articles of manufacture generally: An Act
to secure to Proprietors of Designs for Articles of Manufacture the Copyright of such Designs for a limited
period of time
...
A consolidating and
updating measure was enacted in 1842
...
It is significant to note that when the designs law was codified in 1842 and took its modern day shape,
copyright protection had not yet been extended to drawings, paintings and photographs
...
Codification of copyright law was
nowhere in sight and came only seventy years later with the enactment of the Imperial Copyright Act, 1911
...
They were
combined in a single enactment by the Patents, Designs, and Trade Marks Act, 1883, which repealed all the
then existing statutes in the three areas
...
The Patents and Designs
Act, 1907 consolidated the enactments relating to patents and designs
...
It was enacted to supplement the Act of 1859 passed by the Governor
General of India for granting exclusive privileges to inventors and added protection for Industrial Design
...
It included in the term “new manufacture” any new
and original pattern or design, or the application of such pattern or design to any substance or article of
manufacture"
...
The Inventions and Designs Act, 1898, which consolidated and amended the law relating to the protection of
inventions and designs contained provisions relating to designs in a separate part
...
The provision relating to
patents under the Indian Patents and Designs Act, 1911, were repealed by the Patents Act, 1970 − a postIndependence updation and consolidation of the patent law
...
The new Designs Act, 2000 has been passed by the Parliament to make the Design Law in India TRIPS
compliant
...
What is Not a Design?
As stated in the definition of the design above, design does not include:
(i) any trademark, as defined in Section 2(zb) of the Trademarks Act, 1999, or
(ii) any property mark, as defined in Section 479 of the Indian Penal Code, 1860, or
(iii) any artistic work, as defined in Section 2(c) of the Copyright Act, 1957
...
(ii) Any work of architecture i
...
any building or structure having an artistic character or design or any
mode for such building or structure
...
An illustrative list of non-registrable designs is as under:
•
book jackets, calendars, certificates, forms and other documents
...
•
post cards, stamps and medals
...
•
any principle or mode of construction of an article
...
•
mere change in size of article
...
•
layout designs of integrated circuits
...
Novelty: A design shall be considered to be new when it has not been disclosed to the public, anywhere in
India or in any other Country, by publication or by use or in any other way, prior to the filing date or priority
date
...
[Section 4]
Originality: Original in relation to a design, means
(a) originating from the author of design, and
(b) includes the cases, which though old in themselves yet are new in their application
...
But if a person conceives for the first time, the idea of
making a flower vase or an ash tray in the form of figure of Taj Mahal, that may be an original design and
shall be registrable
...
Every application for registration is required to be in the
prescribed manner and accompanied by the prescribed fee
...
As per Section 7, the Controller shall, as soon as may be after the registration of a design, cause publication
of the prescribed particulars of the design to be published in the prescribed manner and the design be open
to public inspection
...
The important purpose of design Registration is to see that the artisan, creator, originator of a design having
aesthetic look is not deprived of his bonafide reward by others applying it to their goods
...
An
application for registration of a Design shall be addressed to the Controller of Designs, the Patent Office at
Kolkata, or at any of its branch offices at New Delhi, Mumbai and Chennai
...
Type of Applications
(a) Ordinary application
...
(b)
Reciprocity application
...
Such an application shall be filed in India within six month from the date of filing in Convention
Country
...
[Section 5, 44]
Substitution of Applicant or Joint Claiming
Name of an applicant can be substituted or a joint claim can be made for an applied design, if the following
requirements are met:
(a) The claim for substitution is made before the design has been registered; and
(b) Right of claimant shall be created only by:
(i) an assignment;
(ii) agreement in writing made by the applicant or one of the applicants; or
(iii) operation of law; and
(c) The design under consideration shall be identified in the assignment or agreement specifically by
reference to the number of application for registration; or
Lesson 9
Industrial Designs 181
(d) The rights of the claimant in respect of the design have been finally established by a Court
...
If the above said
requirements are fulfilled and the Controller is satisfied that upon registration of design, the claimant would
be entitled to any interest in the design, the Controller may direct that the application shall proceed:
(i) in the names of the claimant(s); or
(ii) in the names of the claimant(s) and the applicant or the other joint applicant(s), as the case may be
...
[Section 8]
CONTENTS OF APPLICATION
Application Form
(a) An application shall be filed in Form-1, along with the prescribed fees, stating the full name, address,
nationality, name of the article, class number and address for service in India
...
In case of
foreign applicants, it is mandatory to give an address for service in India
...
(b) The class to which the article belongs shall be mentioned correctly in Form-1
...
It may be noted
that for registering a design in more than one class, a separate application is required to be filed for each
class
...
In
India, only a registered patent agent or a legal practitioner can be appointed as an authorised agent
...
[Sections 5, 6, 43, 44, Rules 4,
9, 10]
A Design Application may be filed personally by an applicant or through a patent agent/legal practitioner
...
General Power of Attorney is also acceptable
...
Such copy shall be duly certified by the Official Chief or Head of the Organisation in which it was
filed
...
Extension may be sought by filing Form-18 along with the prescribed fee
...
The Designs Rules require that four copies of the representation shall be filed along
with the application
...
(b) Representation means the exact representation of the article for which registration is sought
...
182 PP-IPRL&P
Representation shall be exactly similar drawings, photographs, tracings including computer graphics or
specimens of the design
...
[Rule 11, 14, 12]
Classification of Designs
(a) For the purpose of registration of designs, articles are classified into thirty-one classes and a
miscellaneous class 99, as described in the Third Schedule of The Design Rules, 2001
...
In case of any ambiguity, the Controller may decide the same, if necessary, in
consultation with the applicant
...
For instance, in case of a design of pen cum torch,
the applicant is at liberty to apply in the class relating to pen, torch, pen-torch, or file two applications in
different classes for better protection
...
However, India is not a signatory to the agreement
...
If the name of article is not common, the applicant may state the purpose
for which the article is intended to be used, in Form-1 and representation sheet, so as to enable the Office to
correctly decide the classification and facilitate search
...
(b) Change in address for service before a design has been registered shall be effected by filing a petition
under Rule 46 with the prescribed fee, along with the fresh Form-1
...
(d) Unless an address for service is given, the Controller shall not proceed with the application
...
[Rule 4, 31, 46 ]
Processing & Examination of the Application
On receipt of an application, the Office accords a date and serial number to the application
...
The application for registration of a design is
refereed by the Controller of Designs to an Examiner of Designs for conducting examination as to:
(a) whether the application and the documents satisfy the formal requirements, and
(b) whether such design as applied to an article is registrable, under the provisions of the Designs Act,
2000 and Designs Rules, 2001
...
Such an application shall proceed for substantive
examination only after compliance of the objections
...
Substantive Examination
Substantive examination is carried out to determine whether the design under consideration is:
(a) ‘a design’ under the Act?
(b) new or original?
(c) prejudicial to public order or morality?
(d) prejudicial to the security of India? [Section 2 (d), 2(g), 5(1), 46 ]
The Controller shall consider the report of Examiner on registrability of a design as applied to an article and if
it is registrable, the same shall be registered forthwith
...
If upon consideration of the report, the Controller is of the opinion that there are objection(s) adverse to the
applicant or the application requires some amendment(s), a statement of objections shall be communicated
to the applicant or to his agent at the address for service by the Controller
...
[Section 5(1), Rule 18]
Registration & Publication
Once an application is registered, it is published in the Patent Office Journal ordinarily within one month
...
The date of registration of an ordinary application is
the date of filing of the application
...
[Section 7]
Certificate of Registration
Upon registration, the Controller issues a certificate of registration to the proprietor of the design
...
No hand delivery of certificate of registration
is allowed
...
The
register is available to public for inspection and an e-register is also available at the official website
...
(b) Such petition may be filed at any of the four Patent Offices
...
However, at present, all further proceedings of
cancellation take place only at Patent Office, Kolkata and hence all communications relating to cancellation
petitions are required to be communicated to that office
...
Procedure
(a) The petition for cancellation shall be accompanied by a statement and evidence setting out the facts
based upon which the petition is filed
...
(b) The fact of filing of a petition for cancellation of registration of a design is published in the Official Journal
...
(d) If the registered proprietor desires to oppose the petition, he shall file at Patent Office, Kolkata, a counter
statement and evidence, if any, setting out fully the grounds upon which he intends to oppose the petition,
within one month from the date of intimation by the Controller, and deliver a copy to the Petitioner,
simultaneously
...
(e) After receipt of counter statement and evidence, if any, from the registered proprietor, the Petitioner may
file his reply statement and evidence, by way of affidavits, within one month from the date of delivery of the
registered proprietor‘s counter statement and evidence
...
This period of one month is extendable by a
maximum of three months, by filing a petition for extension with the required fee
...
(f) No further evidence shall be delivered by either party, except with the leave or direction of Controller
...
(h) After completion of the filing of statement and evidence by the Petitioner and Registered Proprietor, the
Controller shall give at least ten days‘ notice for hearing
...
(j) The Controller may refuse to hear any party which has not given such notice and fee
...
Such notice shall be given at least five days‘ in
advance
...
The decision of Controller shall be notified to the parties and
shall be published in the Official Journal
...
[Section 19, Rule 29]
Provisions of Copyright Act as Applied to a Design
A creator of a design shall keep in mind the following provisions of the Copyright Act, 1957:
(a) Copyright shall not subsist under the Copyright Act in any design which is registered under the
Designs Act
...
[Section 15 of The Copyright Act, 1957]
Period of Protection
The duration of a design registration is initially ten years from the date of registration but in cases where
claim to priority has been allowed, the duration is ten years from the priority date
...
[Section 11]
Rights in Lapsed Design, Which Has Been Restored
A proprietor shall have no right to institute a suit or proceeding in respect of piracy of design or infringement
of the copyright, which has been committed between the date on which the design ceased to have effect and
the date of restoration of the design
...
Publishing such articles or exposing them for sale with
knowledge of the unauthorized application of the design to them also involves piracy of the Design
...
During the existence of copyright over any design, other persons are prohibited from
using the design except or with the permission of the proprietor, his licensee or assignee
...
[Section 22]
Penalties
A registered proprietor can institute a suit for injunction as well as recovery of damages against any person
engaged in piracy of the registered design
...
However, in case of reciprocity application, the registered
proprietor can claim damages only from the actual date on which the design is registered in India
...
However, the total sum recoverable
in respect of any one design shall not exceed ` 50,000/-
...
[Section 2(c),11,22
...
Ashok Biscuit Works, AIR 1973 AP 17, the appellant
manufactured biscuits with AP embossed on them
...
The suit claimed injunction bringing a
charge of piracy of design
...
In a case between Hindustan Lever Ltd
...
Nirma Pvt
...
, AIR 1992 Bom 195, the plaintiff alleged
infringement of its registered trade mark, passing off, and infringement of the copyrights in original artistic
work and sought permanent injunction to restrain the defendant from using the impinged carton in relation to
soaps or detergent powder
...
The
Court ruled that a label to be put on a carton for the goods is not a design
...
Section
30(1) of the Design Act states that where a person becomes entitled by assignments, transmission or other
operation of law to the copyright in a registered design, he may make application in the prescribed form to
the Controller to register his title
...
Section 30(4) of
the Design Act, 2000 states that the absolute right to assign the design rights lie with the person registered
as proprietor of the design
...
Similarly, the rights acquired by third parties by way of assignments or licenses are only
made effective if the same is duly registered in accordance with the provisions of the Act and the Rules
framed there-under
...
LESSON ROUND UP
•
An industrial design is the ornamental or aesthetic aspect of an article
...
•
The Designs Act of 1911 is now replaced by the Designs Act, 2000
...
Industrial Design law deals
with the aesthetics or the original design of an industrial product
...
The total time of a registered design is 15
years
...
•
The important purpose of design Registration is to see that the artisan, creator, originator of a design
having aesthetic look is not deprived of his bonafide reward by others applying it to their goods
...
•
The registration of a Design may be cancelled at any time after the registration of the Design on a petition
for cancellation in Form 8, along with the prescribed fee
...
•
Piracy of a Design means the application of a design or its imitation to any article belonging to the class of
articles in which the design has been registered for the purpose of sale or importation of such articles
without the written consent of the registered proprietor
...
SELF TEST QUESTIONS
(These are meant for recapitulation only
...
1
...
What is the object of registration of designs? What are the essential requirements for the
registration of a design under the Designs Act, 2000?
3
...
Is registration compulsory for obtaining design protection? What designs are not eligible for
registration under the Designs Act, 2000?
4
...
What constitutes piracy of a registered design? What penalties have been provided for piracy of a
registered design under the Designs Act, 2000?
Lesson 10
GEOGRAPHICAL INDICATIONS
LESSON OUTLINE
LEARNING OBJECTIVES
A geographical indication is a sign used on goods
that have a specific geographical origin and possess
•
Introduction
•
Meaning and Nature
Indications
•
Registration
•
Conditions & Procedure for Registration
•
Offences and Penalties
products typically have qualities that derive from their
place of production and are influenced by specific
•
Lesson Round Up
local factors, such as climate and soil
...
Most
commonly, a geographical indication includes the
name of the place of origin of the goods
...
Under
the Agreement on Trade Related Aspects of
Intellectual Property Rights (TRIPS), there is no
obligation for other countries to extend reciprocal
protection unless a geographical indication is
protected in the country of its origin
...
It is important for the students to know the legal
position relating to geographical indications of goods
in India; why do geographical indications need
protection and how geographical indications are
protected; who are entitled for registration; which of
the geographical indications cannot be registered;
and when is a registered geographical indication said
to be infringed etc
...
Geographical indications (GIs) are place names (in some countries also words associated with a place) used
to identify products that come from these places and have these characteristics (for example, “Champagne”,
‘Scotch whisky’ “Tequila” or “Roquefort”)
...
Like trademarks or commercial names GIs are also IPRs,
which are used to identify products and to develop their reputation and goodwill in the market
...
Articles 22 to 24 of Part II Section III of the
TRIPS prescribe minimum standards of protection to the geographical indications that WTO members must
provide
...
1)
...
India did not have such a specific law governing
geographical indications of goods which could adequately protect the interest of producers of such goods
...
In the case of turmeric, in March
1995, a US Patent was granted to two NRIs at the University of Mississippi Medical Centre Jackson, for
turmeric to be used as wound healing agent
...
Even CSIR presented an ancient Sanskrit text and a paper
published in 1953 in the Journal of the Indian Medical Association as documentary evidence
...
In the case of neem, patents were granted to the US Company WR Grace & Co
...
The Indian Government filed a complaint with the US Patent Office accusing WR Grace of
copying an Indian Invention but later on they realized that the US based company had in fact created a new
invention for the neem extraction process and the patent was not based on traditional knowledge and hence
government withdrew its complaint
...
The USPTO granted the
patent on ‘Basmati Rice Lines and Grains’ in September 1997 after three years examination and accepted all
the 20 claims put forward by them
...
A team of agricultural scientists screened
several research papers, reports and proceedings of seminars, conferences, symposia, journals, news
papers and archives for relevant supporting information to establish the existence of prior art in this area in India
...
15, 16 and 17 of the company for novelty were so strong
that Rice Tec had to withdraw these claims
...
Thus only five of the Rice
Tec's original 20 claims survived the Indian challenges
...
The new rice has nothing to do with basmati
...
Also, the Rice Tec
...
The patent granted, therefore, neither prevents Indian Basmati from being exported to the US
nor puts it at a disadvantage in the market
...
Therefore,
India could challenge the patent only after it was granted
...
Accordingly the Parliament enacted a
legislation titled the Geographical Indications of Goods (Registration and Protection) Act, 1999 which came
into force with effect from 15th September 2003
...
The Object of the Geographical Indications of Goods (Registration and Protection) Act, 1999 is three fold,
firstly by specific law governing the geographical indications of goods in the country which could adequately
protect the interest of producers of such goods, secondly, to exclude unauthorized persons from misusing
geographical indications and to protect consumers from deception and thirdly, to promote goods bearing
Indian geographical indications in the export market
...
Appeal against the Registrar's
decision would be to the Intellectual Property Appellate Board established under the Trade Marks legislation
...
Other
examples include Darjeeling Tea, Mysore Silk, Paithani Sarees, Kota Masuria, Kolhapuri Chappals, Bikaneri
Bhujia and Agra Petha
...
(b) Provision for the maintenance of a Register of Geographical Indications in two parts-Part A and Part
B and use of computers etc
...
While Part A will contain all
registered geographical indications, Part B will contain particulars of registered authorized users
...
(d) Prohibition of registration of certain geographical indications
...
(f) Compulsory advertisement of all accepted geographical indication applications and for inviting
objections
...
(h)
(i)
Provisions for higher level of protection for notified goods
...
of a geographical indication as it is public property
...
192 PP-IPRL&P
(k) Appeal against Registrar's decision would be to the Intellectual Property Appellate Board
established under the Trade Mark legislation
...
(m) Provision detailing the effects of registration and the rights conferred by registration
...
Definitions
Section 2 of the Act defines the terms used in the Act
...
[Section 2(1) (b)]
Any person claiming to be a producer of the goods in respect of which a geographical indication has been
registered may apply for registration as an authorized user
Geographical Indication
“Geographical indication” in relation to goods means an indication which identifies such goods as agricultural
goods, natural goods or manufactured goods as originating, or manufactured in the territory of a country, or a
region or locality in that territory, where a given quality, reputation or other characteristic of such goods is
essentially attributable to its geographical origin and in case where such goods are manufactured goods one
of the activities of either the production or of processing r preparation of the goods concerned takes place in
such territory, region or locality, as the case may be
...
[Section
2(1) (e)]
Goods
“Goods” mean any agricultural, natural or manufactured goods or any goods of handicraft or of industry and
includes food stuff
...
[Section 2(1) (g)]
Producer
“Producer” in relation to goods, means any person who,(i) if such goods are agricultural goods, produces the goods and includes the person who processes or
packages such goods;
(ii) if such goods are natural goods, exploits the goods;
(iii) if such goods are handicraft or industrial goods, makes or manufactures the goods,
Lesson 10
Geographical Indications 193
(iv) and includes any person who trades or deals in such production, exploitation, making or
manufacturing, as the case may be, of the goods
...
[Section 2(1) (o]
Under Section 3 of the Act Registrar of Geographical Indications is the Controller General of Patents,
Designs and Trade Marks appointed under sub-section (1) of Section 3 of the Trade Marks Act, 1999
...
The Registrar may also classify the goods under in accordance with the International classification of goods
for the purposes of registration of geographical indications and publish in the prescribed manner in an
alphabetical index of classification of goods
...
Who are Entitled for Registration?
As per Section 11 any association of persons or producers or any organisation or authority established by or
under any law representing the interest of the producers of the concerned goods can apply for the
registration of a geographical indication
...
Any such organisation or association being not that of the producers may have to prove that they
represent the interest of producers
...
An application for registration of a geographical indication is to be made in writing, along with the prescribed
fees (as specified under First Schedule), and should be addressed to the Registrar of Geographical
Indications
...
S
...
Road, Guindy, Chennai – 600032 having all-India Jurisdiction
...
Filing of Application
(i) An Indian application for the registration of a geographical indication can be made in triplicate in
Form GI – 1(A) for single class and in GI – 1 (C) for multiple classes
...
(iii) Power of Attorney, if required
...
194 PP-IPRL&P
Contents of Application
The application should include the requirements and criteria for processing a GI application as specified
below:
•
A statement as to how the geographical indication serves to designate the goods as originating from
the concerned territory of the country or region;
•
The class of goods;
•
geographical map of the territory or locality in which goods are produced;
•
The particulars of appearance of the geographical indication;
•
Particulars of producers;
•
An affidavit of how the applicant claims to represent the interest in the GI;
•
The standards benchmark for the use or other characteristics of the GI;
•
The particulars of special characteristics;
•
Textual description of the proposed boundary;
•
The growth attributes in relation to the GI pertinent to the application;
•
Three certified copies of the map of the territory, region or locality ;
•
Particulars of special human skill involved , if any;
•
Full name and address of the association of persons or organization;
•
Number of producers; and
•
Particulars of inspection structures, if any, to regulate the use of the GI
...
On receipt of the application, a number is allotted
...
Deficiencies if any found through a
preliminary examination would be communicated by the Examiner to the Applicant
...
[Rule31]
Upon compliance of the deficiencies, the Registrar shall ordinarily constitute a Consultative Group of experts
(not more than seven representatives) to ascertain the correctness of the particulars furnished in the
Statement of Case
...
[Rule
33]
After issuance of the Examination Report, submissions of the applicant would be considered
...
[Rule, 34& 38]
After advertisement of a Geographical Indication in the Geographical Indications Journal, any person may
within three months oppose the registration of an application for GI
...
Such an application for extension shall be filed before the expiry of the period of three months
...
[Section 14, Form
GI-2]
Registration
If no opposition is filed within the period specified or where an opposition is filed and it is dismissed and the
Lesson 10
Geographical Indications 195
appeal period is over, the Registrar registers the geographical indication in Part A of the Register unless the
Central Government otherwise directs
...
The date of filing of the application shall be deemed to be the date of
registration
...
[Section 16]
Duration of Registration
According to Section 18, a registered geographical indication shall be valid for 10 years and can be renewed
from time to time on payment of renewal fee
...
[Section31]
Benefits of Registration
Geographical Indications registration gives to the registered proprietor and its authorised users, the legal
right to the exclusive use of the GI and also the right to obtain relief in case of its infringement
...
Prohibition of Registration of Certain Geographical Indications
For registrability, the GI must fall within the scope of the definition of the expression “geographical indication‟
as given under Section 2 (1) (e) of GI Act
...
It may be noted that “generic names or indications'', in relation to goods, means the name of a goods which,
although relates to the place or the region where the goods was originally produced or manufactured has lost
196 PP-IPRL&P
its original meaning and has become the common name of such goods and serves as a designation for or
indication of the kind, nature, type or other property or characteristic of the goods
...
Offences & Penalties
Chapter VIII of the Act details certain acts as offences punishable by imprisonment or with fine or with both
...
The chapter apart from listing penalties for the above-mentioned offences also
details the penalty and procedure of prosecution
...
Section 38 list two kinds of offences namely:(a) falsifying a GI and
(b) falsely applying a GI
...
• Selling goods to which false GI is applied as outlined in Section 40
...
• Falsely representing a GI as registered as listed in Section 42
...
• Improperly describing a place of business as connected with the GIs Registry as listed in Section
43
...
• No offence in certain cases as provided under Section 45
...
• Procedure where invalidity of registration is pleaded by the accused as provided in Section 18
...
Sub-section (3) lays down that the offences stated under Sections 39, 40 and 41 shall be cognizable
...
Lesson 10
Geographical Indications 197
Sub-section (4) enacts that a police officer not below the rank of Deputy Superintendent of Police or
equivalent, if he is satisfied that a cognizable offence has been committed or is likely to be committed, may
search and seize- without warrant- the goods, die, block, machine, parts, plates, or other instruments or
things involved in the commission of the offence, and whenever found shall be produced before the
magistrate at the earliest
...
In addition to the above, the Registered Proprietor or Authorised User can obtain relief in respect of
infringement of the Geographical Indications in the manner provided by this Act
...
LESSON ROUND UP
•
A geographical indication points to a specific place, or region of production, that determines the
characteristic qualities of the product which originates from that place
...
Like trade marks or commercial names, geographical
indications are also IPRs, which are used to identify products and to develop their reputation and goodwill
in the market
...
Notably, under the Agreement on Trade Related Aspects of Intellectual Property
(TRIPS), countries are under no obligation to extend protection to a particular geographical indication
unless that geographical indication is protected in the country of its origin
...
This resulted into controversial cases like turmeric, neem
and basmati
...
Accordingly the
Parliament enacted a legislation titled the Geographical Indications of Goods (Registration and Protection)
Act, 1999
•
The legislation is administered through the Geographical Indication Registry under the overall charge of the
Controller General of Patents, Designs and Trade Marks
...
•
Any person claiming to be a producer of the goods in respect of which a geographical indication has been
registered may apply for registration as an authorized user
...
•
Geographical indication may be registered in respect of any or all of the goods, comprised in such class of
goods as may be classified by a region or locality in that territory, as the case may be
...
•
A registered geographical indication shall be valid for 10 years and can be renewed from time to time on
payment of renewal fee
...
•
The legislature has taken a strong view of infringement, piracy, falsification, misrepresentation of
geographical indications and has now made them penal offences
...
Answers to these questions are not required to be submitted
for evaluation)
...
What is a geographical indication? How is a geographical indication different from a trade mark?
List out the examples of possible Indian Geographical Indications?
2
...
Who can apply for the registration of a geographical indication? What is the benefit of registration of
geographical indications? Who is a registered proprietor of a geographical indication?
4
...
When is a registered geographical indication said to be infringed? Who can initiate an infringement
action?
6
...
Information alone
•
Introduction
•
Legislation Governing Trade Secrets
•
Protection under TRIPS Agreement
does not confer competitive advantage
...
It is human ingenuity that turns information
•
What Causes a Business to Lose Trade
Secret Protection
into knowledge and gives it value
...
Today more than ever, intellectual property also
includes confidential business information, trade
secrets,
know-how
and
key
business
relationships
...
However,
some ideas cannot be patented and indeed, some
innovators do not want to patent their ideas as for
instance trade secret or confidential information
...
Once the
information is leaked and goes into the public
domain, it is lost forever
...
The study lesson explains the importance of trade
secrets to the business enterprises whether small,
medium or large and why this key strategic asset
needs to be protected
200 PP-IPRL&P
A trade secret is any kind of information that is secret or not generally known in the relevant industry giving
the owner an advantage over competitors
...
Examples of trade secrets include formulas,
patterns, methods, programs, techniques, processes or compilations of information that provide one’s
business with a competitive advantage
...
However, there are three factors that (though subject
to differing interpretations) are common to all such definitions: a trade secret is some sort of information that
(a) is not generally known to the relevant portion of the public, (b) confers some sort of economic benefit on
its holder (which means this benefit must derive specifically from the fact that it is not generally known, not
just from the value of the information itself), and (c) is the subject of reasonable efforts to maintain its
secrecy
...
Probably one of the
most significant differences is that a trade secret is protected without disclosure of the secret
...
Unlike patent, a trade secret does not have to pass the test of
novelty; nevertheless the idea should be somewhat new, unfamiliar to many people including many in the
same trade
...
Instead, the judicial system of each country determines the requirements for obtaining trade secrets
protection
...
The TRIPS Agreement under Article 39 protects trade secrets in the form of “undisclosed information”, and
provides a uniform mechanism for the international protection of trade secrets
...
e
...
Also, the information must have commercial value because it is secret and
the information must be subject to reasonable steps by its owners to keep it secret
...
Trade secrets are by definition not disclosed to the world at large
...
Once the information enters the public domain, it is lost forever
...
Instead, owners of trade secrets
seek to keep their special knowledge out of the hands of competitors through a variety of civil and
commercial means, not the least of which is the employment or confidentiality agreements and/or nondisclosure agreements
...
Often, he will also
sign over rights to the ownership of his own intellectual production during the course (or as a condition) of his
employment
...
Similar agreements are often
signed by representatives of other companies with whom the trade secret holder is engaged in licensing talks
or other business negotiations
...
Trade secret protection can, in principle,
extend indefinitely and in this respect offers an advantage over patent protection, which lasts only for a
specified period
...
Companies often try to discover one another’s trade secrets through lawful methods of reverse engineering
on one hand and less lawful methods of industrial espionage on the other
...
The importance of that
illegality to trade secret law is as follows: if a trade secret is acquired by improper means (a somewhat wider
concept than “illegal means” but inclusive of such means), the secret is generally deemed to have been
misappropriated
...
(The holder of the trade secret is nevertheless obliged
to protect against such espionage to some degree in order to safeguard the secret
...
)
The test for a cause of action for breach of confidence in the common law world is set out in the case of
Coco v
...
N
...
, (1969) R
...
C
...
The “quality of confidence” highlights the fact that trade secrets are a legal concept
...
However, so
long as the owner of the trade secret demonstrates that reasonable efforts have been made to keep the
information confidential, the information remains a trade secret and is legally protected as such
...
It is for this reason that
trade secret owners shred documents and do not simply recycle them
...
Legally the trade secret remains a trade secret
because shredding the document is considered to have kept the quality of confidence of the information
...
Some times a trade secret is
not really a secret and may not be of much value either
...
Companies must be assured trade secret protection, which they are enjoying in their respective
countries under the international licencing agreements
...
If a company cannot ensure protection of its trade secrets in a foreign country, it will not do
business in that country
...
202 PP-IPRL&P
A checklist for the identification of potential trade secrets owned by a manufacturing company has been
devised which inter alia includes:
(i) technical information/research and development;
(ii) proprietary technology information;
(iii) proprietary information concerning research and development;
(iv) formulas;
(v) compounds;
(vi) prototypes;
(vii) processes;
(viii) laboratory notebooks;
(ix) experiments and experimental data;
(x) analytical data;
(xi) calculations;
(xii) drawings- all types;
(xiii) digrams- all types;
(xiv) design data and design manuals;
(xv) R&D reports-all types;
(xvi) R&D know-how and negative know-how (i
...
what does not work);
(xvii) Production/ process information;
(xviii) Proprietary information concerning production/process etc
...
This will help the companies to assess the value of the
information useful for their business
...
Some information becomes obsolete, new information is created which is extremely valuable and may be
protected
...
There are six factors which need to be taken into consideration while
determining whether information owned or used by a company is a trade secret in terms of the necessary
level of security to ensure adequate protection of those trade secrets
...
— The extent to which the information is known by employees and others involved in the company
...
— The value of the information to the company and the competitors
...
— The ease or difficulty with which the information could be properly acquired or duplicated by others
...
•
Unlike patent, a trade secret does not have to pass the test of novelty; nevertheless the idea should be
somewhat new, unfamiliar to many people including many in the same trade
...
In India, trade
secrets are not covered under any law
...
•
Trade secrets are by definition not disclosed to the world at large
...
As for instance formula for Coca-Cola which is considered to be one of the
best well protected trade secrets
...
•
If a trade secret is well protected, there is no term of protection
...
SELF TEST QUESTIONS
These are meant for re-capitulation only
...
1
...
How are trade secrets protected?
3
...
The TRIPS Agreement provides protection to trade secrets
...
5
...
The laws dealing with restrictive trade
practices in India are contained under the Patents Act
and the Competition Act
...
If a
company cannot ensure protection of its trade secrets
in a foreign country, it will not do business in that
country
...
Assignment agreements are of considerable
importance in IPR since they allow the intellectual
property owners to transfer their intellectual property
for commercial returns, ensuring that the intellectual
property can be used for monetary gain
...
While formulating the licensing
agreement, the parties involved should define the
technology to be transferred without any ambiguity
...
An IP audit helps a business to make an
inventory of its IP assets
...
206 PP-IPRL&P
Intellectual Property Rights have become a significant factor in both creating and using ideas that are
translated into knowledge and inventions to promote innovation and economic growth
...
As innovation and creativity are essential for sustainable growth and
economic development following core conditions enable innovation and encourage economic growth:
− strong standards and effective enforcement of intellectual property rights,
− vigorous competition and contestable markets,
− open trade and investment in a stable economic environment,
− strong and sustainable fundamental research and development infrastructure,
− sound policies and mechanisms to promote interface between science and innovation,
− efficient and transparent regulatory systems, and
− ethics and the rule of law
...
Rapid changes in key technological, economic and social drivers underscore
the importance of intellectual property as it provides an increasingly critical legal and policy instrument for
encouraging innovation, stimulating investments needed to develop and market new innovations, and
diffusing technology and other knowledge in economically and socially beneficial ways
...
Competition law seeks
to prevent companies from inappropriately creating, enhancing or maintaining market power that undermines
competition without offering economic benefits
...
Intellectual property law and competition law are therefore two complementary instruments that promote
economic efficiency
...
Since the right to exclude, which is the basis of intellectual property rights, is necessary for efficient,
competitive markets, the enforcement of the Competition Law rarely interferes with the exercise of this basic
right
...
Interface between Intellectual Property Rights and Competition
Intellectual Property Law and competition law are both necessary for the efficient operation of the
marketplace
...
Similarly, competition law is intended to enhance consumer welfare by promoting competitive markets and
consumer choice
...
Brands enable consumers to choose the products they value, which encourages competition among brand
owners
...
Accordingly, competition and intellectual property law are closely linked, as intellectual property law rewards
innovation by granting exclusive rights, the competition law ensures that companies do not restrict freedom
to compete or exploit market power with anti-competitive consequences
...
But it
is now accepted that, since they do not necessarily, or even very often, create legal or economic monopolies,
intellectual property laws do not necessarily clash with competition laws because the goods and services
produced using intellectual property compete in the marketplace with other closely-substitutable goods and
services
...
However, in situations where intellectual
property owners are in a position to exert substantial market power or to engage in anti-competitive conduct,
the conflict between the two becomes apparent
...
The key issue in
such situations therefore, is to find out an appropriate balance between intellectual property and competition
laws
...
Mention must be made that most competition laws contain exemptions or exceptions designed to ensure that
they do not negate rights explicitly granted by respective intellectual property laws
...
Competition law is in particular applicable to agreements
whereby the owner of intellectual property rights licenses another undertaking to exploit intellectual property
rights
...
This integration can lead to more efficient exploitation of the
intellectual property, benefiting consumers through reduction of costs and introduction of new products
...
By potentially
increasing the expected returns from intellectual property, licensing increases the incentive for its creation
and thus promotes greater investment in research and development
...
If an intellectual property owner licenses, transfers or sells the IP
208 PP-IPRL&P
to a company or a group of companies that would have been actual or potential competitors without the
arrangement, and if this arrangement creates, enhances or maintains market power, the competition
authorities may seek to challenge the arrangement under the appropriate provisions of the Competition Law
...
Thus, Licensing arrangements raise concerns under the competition laws if they are likely to affect adversely
the prices, quantities, qualities, or varieties of goods and services either currently or potentially available
...
Restrictive Practices under Intellectual Property Licensing
The term restrictive practice signifies non-governmental measures used by companies to strengthen their
position in a given market
...
Competition and anti-trust laws deal with such business practices and prohibit them when it is
established that they have the effect of distorting or preventing competition in a given market
...
The provisions of the Paris Convention contain a broad
stipulation that any act of competition contrary to honest practices in industrial and commercial matters
constitutes an act of unfair competition
...
UNCTAD Code of Conduct on Transfer of Technology under Chapter IV has also recognised some practices
as restrictive practices
...
KINDS OF RESTRICTIVE PRACTICES
As discussed above, restrictive trade practices under the guise of intellectual property licensing can always
be corrected by competition authorities
...
1
...
Where the supplier of the technology imposes any
restriction after the expiration of the term of intellectual property rights, such restriction is deemed to
be the restrictive trade practice
...
The problem may also arise when the secret know-how loses its secret character before
the expiration of the agreement
...
Restrictions after Expiration of Arrangements
The use of such clauses in intellectual property licensing will generally oblige licensee to pay
royalties during the entire duration of manufacture of product or the application of the process
involved, without specifying any time limit
...
3
...
The use of such clauses affects directly or indirectly the possibilities for the
technological development capabilities of the licensee
...
These restrictions also
cover such provisions which are in direct competition with Research and Development activities of
the licensor
...
The provisions of the code identified such
clauses as restricting the licensee from undertaking R&D activities directly to absorb and adapt the
transferred technology to suit local conditions or restriction on initiation of R&D programmes in
connection with new products, processes or equipment
...
Non-Competition Clauses
The Non-competition clause in intellectual property licensing includes the restriction on freedom of
licensee company to enter into arrangements to use or purchase the competing technologies or
products not furnished or designated by the company supplying technology
...
Some of the non-competition
clauses which may have direct effect, oblige the licensee company not to manufacture or sell
competing products or not to acquire competing technology
...
5
...
These clauses also oblige the licensee to use personnel designated by the licensor
...
The tie-in clauses generally result in a monopoly control of the supply of equipment and other inputs
by supplying enterprises, leading to “transfer pricing”, “transfer accounting” or “uneconomic output”
...
The use of tying clauses not only
affects production costs through the overpricing of inputs but may have important indirect effect on
210 PP-IPRL&P
the import substitution, export diversification and growth efforts of licensee
...
Export Restrictions
Export restrictions may include conditions restricting or prohibiting the export of products
manufactured by the transferred technology
...
The restrictions having direct impact involve complete restriction on the export of products
...
These restrictions may also include prohibition or permission to export
only specified goods
...
Amongst others, the important indirect
export restrictions include the prior approval of licensor to export the goods manufactured by the
imported technology, including the requirement of primary responsibility for the domestic market or
higher royalties on output designated for export
...
In some other cases obligations are imposed
to sell its product exclusively to the licensor or to export only through licensor or its designated
agents
...
Price Fixing
Price fixing clause in an intellectual property license involves the practices where the licensor
reserves the right to fix the sale or resale price of the product manufactured by the imported
technology
...
Price-fixing may also involve horizontal price
cartels between several technology suppliers or several technology recipients
...
Restrictions on Field of Use, Volume or Territory
Restrictions on the field of use authorises licensor to restrict the use of the technology or reserve
some uses of technology for self-exploitation or exploitation by third parties
...
The volume of production may also be controlled by higher royalties to be paid beyond a
certain production quota or to produce by manufactured goods in a prescribed package with a
certain weight
...
The volume restrictions are generally used by the licensor to preserve its competitive position in a
given market
...
While licensing restraints such as territorial or field-of-use limitations appear restrictive of
competition, they may in fact serve pro-competitive ends by promoting licensing, and thus the
dissemination and more efficient exploitation of the technology
...
9
...
These provisions oblige the licensee company to transfer to the licensor of technology, free
of cost, any invention or improvement made in the imported technology
...
A unilateral grant-back provision establishes unilateral flow of technical information or improvement
by licensee without any reciprocal obligation of the licensor
...
While in the case of an exclusive grant back clause, though the licensee may be allowed to
freely use the invention and improvement developed by it, yet the licensee is prohibited from
transfering or licensing the same to the third party
...
The main reason behind the inclusion of grant-back provision appears to be rooted in the free of
cost grant-back
...
In this situation, the licensor receives
the improved technology without sharing its risk or contributing in recipient’s financial burdens
...
There are often pro-competitive reasons for including grant back provisions in an intellectual
property licensing, and these generally do not pose competition concerns, especially where they are
non-exclusive in nature
...
10
...
In other words, licensee company becomes handicapped and dependent on the licensor's
distribution channels
...
The Paris Convention for Protection of Industrial Property provides for efficient protection against unfair
competition
...
The Paris Convention allows the grant of compulsory licences to prevent abuses
resulting from the exercise of the exclusive rights conferred by patents
...
Article 40
...
It allows member countries
“to adopt, consistently with the other provisions of this Agreement, appropriate measures to prevent or
control such practices
...
The repression
of anti-competitive practices associated with IPRs is therefore assigned to national competition laws and
212 PP-IPRL&P
policies
...
In
particular, consultations among member countries are envisaged, inter alia through the supply of publicly
available non-confidential information
...
Article 40 affirms the right of member countries to specify in their legislations licensing practices or conditions
that may in particular cases constitute an abuse of intellectual property rights having adverse effects on
competition in the relevant market and to adopt, consistently with other provisions of the Agreement,
appropriate measures to prevent or control such practices which may include, for example, exclusive grantback conditions, conditions preventing challenges to validity, and coercive package licensing
...
Article 31 of TRIPs agreement lays down conditions limiting the use of patents without authorization of the
IPR holder, including both uses by Governments or by third parties i
...
through compulsory licenses
...
Intellectual Property and Competition: Indian Position
As mentioned above, the laws dealing with restrictive trade practices in India are contained under the
Patents Act and the Competition Act
...
Section 140 makes it unlawful to insert in any contract for or
in relation to the sale or lease of a patented article or an article made by a patented process; or in licence to
manufacture or use a patented article; or in a licence to work any process protected by a patent, a condition
the effect of which may be (a) to require the purchaser, lessee, or licensee to acquire from the vendor, lessor, or licensor or his
nominees, or to prohibit him from acquiring or to restrict in any manner or to any extent his right to
acquire from any person or to prohibit him from acquiring except from the vendor, lessor, or licensor
or his nominees any article other than the patented article or an article other than that made by the
patented process; or
(b) to prohibit the purchaser, lessee or licensee from using or to restrict in any manner or to any extent
the right of the purchaser, lessee or licensee, to use an article other than the patented article or an
article other than that made by the patented process, which is not supplied by the vendor, lessor or
licensor or his nominee; or
(c) to prohibit the purchaser, lessee or licensee from using or to restrict in any manner or to any extent
the right of the purchaser, lessee or licensee to use any process other than the patented process; or
(d) to provide exclusive grant back, prevention to challenges to validity of patent and coercive package
licensing
...
In
proceedings against any person for the infringement of a patent, it shall be a defence to prove that at the
time of the infringement there was in force a contract relating to the patent and containing a condition
declared unlawful by section 140
...
The provisions of Section 140 shall not affect a condition in a contract by which a person is prohibited from
selling goods other than those of a particular person; validate a contract which, but for this section would be
invalid; and affect a condition in a contract for the lease of, or license to use, a patented article, by which the
lessor or licensor reserves to himself or his nominee the right to supply such new parts of the patented article
as may be required or to put or keep it in repair
...
Competition Act, 2002
The Competition Act, 2002 prohibits an enterprise or association of enterprises or person or association of
persons from entering into any agreement in respect of production, supply, distribution, storage, acquisition
or control of goods or provision of services, which cause or is likely to cause an appreciable adverse effect
on competition within India
...
Thus the Act
reduces the whole agreement as ‘void’ if it contains anti-competitive clauses having appreciable adverse
effect on competition
...
Section 3(3) provides that following kinds of agreement between any person or enterprise or association of
enterprises or practice carried on, or decision taken by them, including “cartels”, in relation to identical or
similar trade of goods or services, to be presumed as having appreciable adverse effect on competition
which –
(a) directly or indirectly determines purchase or sale prices;
(b) limits or controls production, supply, markets, technical development, investment or provision of
services;
(c) shares the market or source of production or provision of services by way of allocation of
geographical area of market, or type of goods or services, or number of customers in the market or
any other similar way; and
(d) directly or indirectly results in bid rigging or collusive bidding
...
In terms of Section 3(4) of the Act, any agreement amongst enterprises or persons at different stages or
214 PP-IPRL&P
levels of the production chain in different markets, in respect of production, supply, distribution, storage, sale
or price of, or trade in goods or provision of services, including - tie-in agreement; exclusive supply
agreement; exclusive distribution agreement; refusal to deal; resale price maintenance; shall be treated as
an agreement in contravention of section 3(1) if such agreement causes or is likely to cause an appreciable
adverse effect on competition in India
...
the Copyright Act, 1957; the Patents Act, 1970; the Trade and Merchandise
Marks Act, 1958 or the Trade Marks Act, 1999; the Geographical Indications of Goods (Registration and
Protection) Act, 1999; the Designs Act, 2000; the Semi-conductor Integrated Circuits Layout-Design Act,
2000
...
Care and Maintenance of Confidential Information
Intellectual Property rights are key elements needed to maintain a competitive edge in the market in today’s
dynamic and competitive business environment
...
Effective acquisition, management and protection of intellectual property can mean the
difference between success and failure in businesses today
...
The various statutes that have been enacted provide an adequate mechanism of protection to intellectual
property rights
...
However, some ideas cannot be patented and indeed, some innovators do not want to
patent their ideas as for instance trade secret or confidential information
...
If a trade secret is really kept a secret, the monopoly on an idea or product may never end
...
Trade secrets are free—just
prevent the secret being disclosed
...
Famous successful
examples include the recipe for Coca-Cola and the formulation of the alcoholic beverage Chartreuse, which
is only known by two monks
...
Knowledge has become the key strategic
differentiator
...
Most sophisticated
business enterprises (whether small, medium, or large) recognize the need to protect this vital intellectual
property
...
It has been observed that many companies surprisingly are oblivious to the fact that these vital
intellectual assets are walking out their front door on a daily, weekly or monthly basis, and heading across
the street to rival competitors
...
What know-how differentiates them from their
Lesson 12
Key Business Concerns in Commercializing Intellectual Property 215
rivals and gives them a strategic advantage over them in the market place? Do they have any trade secrets
or unique technical expertise or processes that are worth protecting? And who owns these key strategic
assets?
Besides, when executives or key employees leave the organisation, the fundamental question arises what
knowledge or information can the employer legitimately claim as its own, and what knowledge or information
can the executive or employer take away with impunity? To mitigate the risk employers can take the
following steps:1
...
Make the secrecy of their key intellectual assets a cultural value in the organization by
treating this information as confidential at all times
...
Revisit Contracts - Ensure that all its employee and contractor agreements include appropriate
confidentiality, intellectual property, and non-competition clauses
...
Conduct exit interviews – Too often employee departures particularly those of executives and senior
employees are managed casually and informally
...
Strategies for Protecting Confidential Information
There are two principal sources of leakage of or trade secrets or confidential information to competitors or
other third parties: disclosure and departure
...
For example, a sales representative or
accounts manager meets with a potential supply chain about pooling resources to go after a new market or
business opportunity
...
The business purpose of the disclosure or exchange of information might be quite legitimate, but the legal
effect of disclosing confidential information without the benefit of a confidentiality or non-disclosure
agreement could be disastrous
...
Departure – The other source of leakage of confidential business information is the exit of executives or key
employees from the organization
...
This has to be balanced against the employer's right to protect its
confidential information
...
Employment or Confidentiality Agreement
Employees should sign Employment Agreements to generally detail the terms of their employment
...
Agreements should be signed before the employee commences employment
...
However, usually they cannot be forced to do so
...
The employee should also be
requested to return all property belonging to the employer and to sign an appropriate acknowledgement
confirming that he has done so and will keep information confidential
...
The type of agreement will vary depending upon the nature and context of the
disclosure
...
In some cases, a confidentiality agreement must be made as a Deed in order to be legally
enforceable
...
A confidentiality agreement should include the following acknowledgements:
− the information is secret;
− the disclosure is made to the recipient in confidence;
− the recipient will not disclose the information to others or use the information for their own
advantage, without the prior authority of the owner of the information; and
− the unauthorised disclosure of the information could cause loss and damage to the owner of the
information and the recipient will be liable for this
...
Nevertheless,
Indian courts have upheld trade secret protection on basis of principles of equity, and at times, upon a
common law action of breach of confidence, which in effect amounts a breach of contractual obligation
...
Further, a person can be contractually bound not to disclose any information that is revealed to him/her in
confidence
...
Intellectual Property Issues in the Sale of Business
When preparing to sell, many business owners think that their business doesn't have or own any intellectual
property unless they have gone through the process of registering a copyright or trademark or procuring a
patent
...
Additionally, items such as third-party licenses (Microsoft Office, for example), IT maintenance and
support contracts, and web-hosting and development contracts also constitute valuable intellectual
property
...
Understanding how intellectual property rights are involved with mergers and acquisitions is essential, given
how merger and acquisition (M&A) activity in the intellectual property field has come to dominate, both in
volume and in value, merger transactions generally
...
The driving force behind a majority of mergers completed during the past decade has been the
acquirer’s desire to obtain the target’s intellectual property assets
...
In the health care industry, for
instance, hospitals continue to merge to acquire the economic clout necessary to force insurers to increase
their coverage payments to the hospitals
...
Despite the fact that M&A’s involving intellectual property have
dominated the merger scene for several years, merger participants are still failing to apply appropriate M&A
valuation procedures
...
Among these intangible assets are the traditional intellectual property
assets such as patents, trademarks, copyrights, know-how and trade secrets
...
In the event of a
merger or other type of corporate restructuring, the acquiring party should obtain equitable and record
ownership of these intangible assets, or at the very least, acquire the appropriate license to use such
intellectual property
...
The transaction should be construed in the context of a sale of an entire business in
which those intangible assets are used
...
Under either scenario, two
basic sets of documents, an “acquisition agreement” and “transfer documents” will be prepared and
negotiated
...
The purpose of the
Acquisition Agreement is to identify the issues essential to the specific transaction, such as the stock or
assets, the purchase price, method of payment, date of closing and any conditions precedent which the
seller or buyer is expected to meet prior to the “closing” date
...
The need to list the assets and liabilities is greater in terms
of an asset purchase as opposed to a share purchase, since purchasers of assets will typically acquire those
assets set forth in the transfer agreement
...
However, regardless of the nature of the transaction, asset
schedules in the context of intellectual property play a key role in determining the representations and
warranties to be included in the agreement
...
For example,
the seller may not be willing to relinquish title to its “house” trademark, but willing to include those marks
covering certain product lines as part of the overall transaction
...
The Representations and Warranties to be incorporated into a typical
purchase agreement tend to be one of the more heavily negotiated aspects of any purchase agreement
...
Transfer Documents: Transfer documents are generally executed separate and apart from the acquisition
agreement discussed above for the purposes of effecting the sale
...
In the context of intellectual
property assets, very often they will be separately transferred to a holding company and either licensed back
to the operating company or become the subject of a subsequent sale to the ultimate purchaser
...
However, very often
intellectual property assets are the subject of a separate agreement in light of the fact that they require
recordal of the new owner in the respective jurisdictions in which they are validly owned and used
...
The parties to the transaction should anticipate these contingencies and a separate
or perhaps several agreements with respect to intellectual property assets should be contemplated
...
If a business is sold as a going concern, the intent to transfer trademarks and the goodwill associated
therewith is presumed, even though not expressly provided for
...
Asset-based
purchases in this context will not automatically include intellectual property rights, rather, ownership of the
intangible assets will remain with the parent corporation unless the underlying agreement expressly provides
for transfer to the subsidiary
...
Purchase of shares will not affect distinct
property rights in intangible assets or other intellectual property to be properly transferred, although a
separate agreement is usually necessary to underscore the parties’ intentions
...
The whole, or
part, of an intellectual property right can be assigned
...
Assigning the
ownership of intellectual property, should always be in writing by means of a formal agreement
...
Assignment agreements differ from license agreements on the ground that an Assignment agreement
actually transfers the ownership of that intellectual property from the assignor to the assignee whereas a
license agreement only permits the licensee to use the intellectual property for a given period of time
...
Lesson 12
Key Business Concerns in Commercializing Intellectual Property 219
Assignment agreements are of considerable importance in IPR since they allow the intellectual property
owners to transfer their intellectual property for commercial returns, ensuring that the intellectual property
can be used for monetary gain
...
These assignment agreements give rise to legal and equitable rights in law and purport many issues
if they are not carefully constructed as required by law
...
Companies who own
valuable IP rights should execute non-disclosure agreements with their employees, agents, or other third
parties and make sure to define the term 'confidentiality' and the obligations of the parties not to disclose it
...
Intellectual Property
Assignment Agreement is a legal contract and required to be in compliance with existing Laws
...
The enforceability of
Assignment Agreements act as an incentive to these individuals to create new inventions which ultimately
benefits society
...
IPR legislations in India provide specific rules, regulations and procedure when dealing with assignment
agreements
...
In order for an Assignment Agreement to be valid and enforceable, it is essential that the Assignment
Agreement be recorded as prescribed by the Acts and relevant Rules
...
The assignment must be concrete and also clarify the tenure
for which the individual would be the owner of the intellectual property
...
The position of an Assignment Agreement in the intellectual property law of India is one of great
consequence despite being a private transaction between the assignor and the assignee
...
It
must be noted, however, that though the law does provide certain safeguards, the onus of creating a suitable
assignment agreement is upon the parties concerned
...
Technology Transfer Agreements
Technology is a complex concept
...
In a broader sense, technology is viewed as any systematic or practical knowledge, experience or skills used
for – (i) manufacture of products or application of processes; (ii) commercial or management purposes in
industry; and (iii) the achievement of any desired result, be it industry or social areas of life
...
The
concept of ‘transfer of technology’ is a complex phenomenon necessarily involving rights, obligations,
privileges and commitments of the parties to the transaction
...
The other commonly used
modes of technology transfer are technical assistance agreement, patents and patent agreement, know-how
agreement, engineering services agreement, the trademark agreement and the franchise agreement
...
From it flows the legal rights and
obligations of the parties to the transaction
...
License may be granted for IP that is necessary to further develop, reproduce, make, use, market, and sell
products based on the technology to be transferred
...
Therefore, while formulating the licensing agreement, the
parties involved should define the technology to be transferred without any ambiguity
...
e
...
;
•
need for additional license for practicing the technology;
•
industrial standards or specifications associated with the technology; and
•
details required to practice the technology
...
associated with the technology;
•
nature of technology (e
...
stand alone technology, platform technology);
•
scope of rights expected from the technology license;
•
territory and industry in which the technology can be utilized; and
•
terms and value of royalty, etc
...
As mentioned earlier, these restrictive practices distort competition in given market
...
LEGAL AUDITING OF INTELLECTUAL PROPERTY
Definition of an IP Audit
(i) IP audit is a systematic review of the IP owned, used or acquired by a business so as to assess and
manage risk, remedy problems and implement best practices in IP asset management
...
(iii) An IP audit helps a business to make an inventory of its IP assets or update it and analyze:
(a) How the IP assets are used or unused
...
(c) Whether these IP assets are infringing the rights of others or others are infringing on these
rights
...
(iv) An IP audit seeks to uncover unused or under-utilized assets, to identify any threats to a company’s
bottom line, and to enable business managers to devise informed business and IP strategies that
help maintain and improve its competitive position in the relevant market(s)
...
(1) General purpose IP Audit
(a) A general or broad IP audit is done in the following types of contexts:
− Before establishing a new company it is always important for a start up company to be aware of
intangible assets it owns or needs to protect
...
− When a business is considering implementing a new marketing approach or direction, or is
planning a major reorganization of the company
...
(b) Once a comprehensive IP audit has been undertaken, a smaller effort and expense is needed at
regular intervals, such as on an annual basis, so that IP assets are reviewed and appropriate
decisions taken, depending on the current and emerging needs of a company
...
Further,
the nature and scope of such an audit is determined by the event in question, and the time and resources
available for doing it
...
“IP due diligence”
is discussed later in the lesson
...
These audits tend to be situational in nature
...
222 PP-IPRL&P
(b) A limited purpose focused audit is done in the following types of contexts:
(i) Personnel turnover:
Before a major personnel turnover of in-house research and develop mentor marketing, especially if it
involves disgruntled employees, an IP audit should be done to secure the status of a company’s IP
assets
...
(iii) Using the Internet for business purposes:
Before having an Internet presence, doing an IP audit helps it to identify the needs of e-commerce and
registration of appropriate domain names, etc
...
(v) Clean room procedures:
The clean room procedure seeks to avoid infringement by ensuring that there is no “access” to
copyrighted material of unrelated parties during software development project
...
(iv) Preparing for litigation:
When considering or facing litigation, a company is required to show non-infringement and no access to
the work, complete or confirm the chain of title of the underlying IP rights or otherwise complete the
documentation of the relevant IP rights
...
However, for an audit to be effective, it is best done by a team that includes expertise in IP and
representatives of the relevant technical areas of the company as may be appropriate for ensuring maximum
effectiveness
...
(ii) External Expertise
The audit team may or may not include external expertise
...
PREPARING FOR AN IP AUDIT
1
...
(i) The situations that prompt an audit and the nature and scope of the audit will to some extent
depend on why it is being conducted
...
2
...
It is an
essential pre-condition for preparing an audit plan, which will be the basis of the audit
...
(b) Background research will be the basis of the audit and will provide the auditor(s) with the required
background information for preparing a plan for conducting an audit that is comprehensive, focused,
timely, and cost effective
...
, and what
role(s) actually IP assets play or would play in these interactions?
(b) Business strategy:
− How does the company do its business?
− Does it have written policies in place concerning key aspects of the business?
− Does it follow a certain business model?
− Does it, for example, engage in e-commerce and, if so, how does it fit in with its overall business
strategy?
(iii) Importance of IP Assets
The overall importance of IP assets to the business will have following bearing on the audit:(a) Where IP assets are relatively unimportant to the nature of the business as a whole, it might be
sufficient merely to confirm that registered IP rights are in good standing and are held in the name
of the company
...
224 PP-IPRL&P
(iv) Status of IP management
(a) What is the company’s overall approach to IP management?
(b) Does it have an in-house intellectual property manager or department and/or does it rely on outside
IP expertise?
(c) Does it have an IP policy or strategy?
(d) How well informed are its staffs on IP matters?
(v) IP disputes
(a) Has the company been involved in infringement suits, whether as plaintiffs or defendants?
(b) Is the company involved in disputes or potential disputes that involve IP rights?
(vi) Financing
Are the IP assets of the company tied to the financing of the company?
3
...
(i) This will set out the purpose, the scope, how long it is expected to take, the budget, and who will be
responsible for which area of the audit plan
...
g
...
g
...
CONDUCTING AN IP AUDIT
1
...
(b) A good checklist minimizes the chances of leaving out one or more relevant steps from the process
...
(c) To produce a comprehensive, company-wide IP audit report reflecting the entire development and
decision-making process for each of the company’s products and processes, the audit team should
collect, review, and organize
...
NDA can be entered into independently as a stand alone agreement or it can
be contained in the MOU for the proposed transaction
...
(ii) Preparing an IP audit plan, defining the scope of the audit, target intellectual properties, time table
of the audit and responsible person(s) for the audit
...
(v) Negotiation
Based on the results of IP analysis and evaluation the proposed dollar range of the value of target
intellectual property is exchanged on the negotiation table
...
It may also have to do or get done relevant IP searches in all key markets
...
Auditing Different Contracts/Agreements
A key part of an IP audit is to identify and assess the adequacy of relevant provisions in all agreements that
concern the protection of IP
...
3
...
There are four steps
for this stage:
(i) Identifying and recording IP assets
In this step, the assets will be initially catalogued and a description will be provided:(a) It is the basic stock taking exercise that will serve to create or update the intangible asset portfolio of
a company
...
(ii) Determining ownership and legal status of the IP assets
The assets will be evaluated as to whether they are owned by the company and if so, whether they are or
should be, protected as IP rights
...
(b) It will enable the company to see where, if any, ownership problems exist, why they exist and what
should be done to prevent or solve such ownership issues
...
(d) The main subjects the auditor should note with respect to each asset are:− Ownership: The nature of the company’s ownership interests (e
...
, sole or joint ownership,
exclusive or non-exclusive license, the royalty or other costs associated with the license and the
estimated legal duration and period of technological usefulness of the asset)
...
g
...
g
...
− Infringement: The potential for a third party claim of infringement or damages due to the
company’s use of the asset
...
(a) If the assets are owned by the company then an audit may provide information as to whether they
are infringed by others
...
(iv) Taking necessary steps for creating and maintaining IP assets
(a) An IP audit will reveal where there have been lapses in the administrative, legal and regulatory
procedures necessary for creating and maintaining IP assets
...
4: After Completing an IP Audit
(A) Using the results of an IP Audit
(i) IP analysis
(a) Evaluate and analyze whether the IP assets are serving the strategic objectives of the company
and, if not, what should be done to change that;
(b) One technique that would help at this stage is to divide the results of the IP inventory into three
groups:
− Group 1: Techniques, innovations, and ideas that are essential to your products and services,
and to the markets your company has decided to serve
...
− Group 3: ‘Assets’ that seem, on balance, to have no great value to your company or to anyone
else
...
− The cost of developing alternative IP assets to fulfill the same or comparable market needs
...
− Market recognition of the asset
...
(iii) Overall review on IP assets and IP policy
An IP audit will provide the management of the company with the basic information as to whether its IP
assets are being used to attain the company’s strategic objectives
...
228 PP-IPRL&P
(b) This can be identified by evaluating the relevance and tangible benefits obtained by using or
leveraging IP assets that a company owns or has access to
...
(b) Advance warning of infringement allows the company to cease infringing activities, obtain a license
or at the least, evaluate its liabilities and defenses
...
The objectives include:
− The types of products or services on which the company intends to focus its resources;
− The markets it intends to serve;
− The return on investment it requires in order to satisfy its owners or shareholders
...
Some of
the more popular approaches are discussed below:
(a) Building value in IP asset creation
...
(c) Reducing costs of third party IP claims
...
(e) Creating non-core revenue streams
...
(g) Building value in corporate transactions
...
(i) Receiving tax deductions for IP asset donations
...
(k) Evaluating the IP assets of an acquisition or investment target (due diligence)
...
(m) Discovering unclaimed business opportunities
...
The results of the IP audit may add a new dimension to strategy discussions and may lead to new business
strategies for the domestic or export markets
...
− Before starting the IP due diligence process, a mutual non-disclosure agreement should be signed
between (a) the potential acquirer, investor, or creditor and (b) the target company
...
(b) Subject?
IP due diligence generally seeks to:
− Identify and locate IP assets, and then assess the nature and scope of the IP to evaluate their
benefits and allocate risks associated with the ownership or use of the relevant IP assets; in
particular, it seeks to determine whether the relevant IP is free of encumbrances for its intended
business use(s)
...
− Identify and apportion between the two parties the expenses incident to the transfer of IP assets
under consideration
...
It could
lead to a significant increase in the value of the acquired company or the resulting merged entity
...
(ii) Financial transactions:
IP due diligence is important before entering into a financial transaction involving IP, such as before
an initial public offering or private placement of stock, or significant stock purchase, or before taking
of a security interest in IP, as all of these have an impact on the ownership of IP
...
(iii) Buying or selling a business division or IP transfer:
− Before a company buys or sells a division or a product line, a seller will generally make a series
of representations and warranties as to the ownership, non-infringement and marketability of the
IP assets linked to the transaction in the ensuing written agreement
...
230 PP-IPRL&P
(iv) Launching a new product or service:
When a significant new product or service is being developed or about to be launched, risk of
infringing IP rights of others might be especially high
...
(v) IP licensing:
A potential licensor has to ensure, for example, that it actually owns the IP that is sought to be
licensed to others
...
A potential licensee has to ensure, for example, that the potential
licensor has the necessary rights to the IP in question so as to legitimately transfer the rights and
that scope and extent of the proposed license will duly serve its intended purpose
...
:
An IP audit would also be appropriate as a planning tool in advance of any filings for bankruptcy,
significant plans for employee layoffs, business closure, or elimination of significant lines of
business
...
Competition law
seeks to prevent companies from inappropriately creating, enhancing or maintaining market power that
undermines competition without offering economic benefits
...
Intellectual property laws provide property rights comparable to those of other kinds of private
property, thereby providing incentives for owners to invest in creating and developing intellectual property
and encouraging the efficient use and dissemination of the property within the marketplace
...
Licensing agreements may also have anti-competitive effects, because such agreements can reduce
potential competition in the technology and innovation markets, which would have existed in the absence of
the agreement
...
some of the restrictive practices mainly used in the intellectual property licensing
agreements are: restrictions after expiration of industrial property rights or loss of secrecy of technical
know-how; restrictions after expiration of arrangements; restrictions on research and development; noncompetition clauses; tie-in arrangements; export restrictions; price fixing; restrictions on field of use, volume
or territory; grant-back provisions; exclusive sales and representation arrangements
•
A number of multilateral agreements in the field of intellectual property deal with unfair competition in
intellectual property transactions
...
•
Most sophisticated business enterprises recognize the need to protect the confidential information/trade
secrets/or know-how
...
It
has been observed that many companies surprisingly are oblivious to the fact these vital intellectual asset
are walking out their front door, and heading across the street to rival competitors
...
Lesson 12
•
Key Business Concerns in Commercializing Intellectual Property 231
Proper consideration and handling of the intellectual property matter greatly in the sale of a business, as
failure to consider or handle them properly can cause problems for the seller at the front and back end of a
sale transaction
...
•
The transfer of ownership in intellectual property is usually effected by a formal assignment
...
•
Assignment agreements are of considerable importance in IPR since they allow the intellectual property
owners to transfer their intellectual property for commercial returns, ensuring that the intellectual property
can be used for monetary gain
...
These assignment agreements give rise to legal and equitable rights in law and purport many
issues if they are not carefully constructed as required by law
...
The
concept of ‘transfer of technology’ is a complex phenomenon necessarily involving right obligations,
privileges and commitments of the parties to the transaction
...
From it flows the legal rights
and obligations of the parties to the transaction
...
The
terms and conditions of a licensing agreement determine the success of the technology transfer
...
•
Intellectual property (IP) audit involves undertaking a comprehensive review of a company’s IP assets,
related agreements, relevant policies and compliance procedures
...
•
There is no hard and fast rule as to who should conduct such an audit
...
•
The IP audit team should have a basic understanding of the product lines, the relevant business
environment and the future plans of the company so that the audit remains focused on IP assets of
maximum business relevance
...
SELF TEST QUESTIONS
These are meant for re-capitulation only
...
1
...
Explain the interface between intellectual property rights and competition
...
Enumerate the competition issues in intellectual property licensing
...
Briefly list out the restrictive practices used in the intellectual property licensing agreements
...
A number of multilateral agreements in the field of intellectual property deal with unfair competition
in intellectual property transactions
...
232 PP-IPRL&P
5
...
6
...
7
...
8
...
What does intellectual property audit mean? What are the types of intellectual property audit?
10
...
11
...
12
...
Write short notes on the following:(i) Tie-in arrangements
(ii) Employee agreement
(iii) Preparing an IP audit plan
(iv) Confidentiality agreement
Lesson 13
MANAGEMENT AND VALUATION OF
INTELLECTUAL PROPERTY
LESSON OUTLINE
•
Management of Intellectual Property
•
Strategies for Effective IPR Management
•
Intellectual Property – Risk Management
•
Valuation of Intellectual Property
•
Methods for the Valuation of Intangibles
•
Lesson Round Up
•
Self Test Questions
LEARNING OBJECTIVES
Effective management of intellectual property
enables companies to use their intellectual property
rights to improve their competitiveness and strategic
advantage
...
designs,
Exploitation of intellectual property rights can take
many forms, ranging from outright sale of an asset, a
joint venture or a licensing agreement
...
Valuation is, essentially, a bringing together of the
economic concept of value and the legal concept of
property
...
Acceptable methods for the valuation of identifiable
intangible assets and intellectual property fall into
three broad categories
...
The study lesson provides an exposure to the
students about the management and valuation of
intellectual property assets
...
New products, brands and creative designs appear almost daily on the
market and are the result of continuous human innovation and creativity
...
As
the Intellectual Property forms an important part of companies’ assets, its adequate protection is crucial in
deterring potential infringement and in turning ideas into business assets with a real market value
...
Companies that dedicate time and resources for protecting their intellectual property can increase their
competitiveness in a number of areas, as it prevents competitors from copying or closely imitating a
company’s products or services; avoids wasteful investment in research and development (R&D) and
marketing; creating a corporate identity through a trademark and branding strategy; negotiating licensing,
franchising or other Intellectual Property based contractual agreements; increasing the market value of the
company; acquiring venture capital and enhancing access to finance; obtaining access to new markets and
most important a careful search for conflicting existing Intellectual Property rights, and the examination of
application by offices can help an enterprise to avoid conflicts and unnecessary litigation
...
In this process, one of the most
important step is to review the existing intellectual property assets, so as to identify and locate the company’s
key intellectual property assets such as patents, patentable subject matter, copyrights, trade marks, designs,
trade secrets, domain names, mask works, inventions, works of authorship, hardware and devices,
depending upon the nature of business
...
Capitalizing on intellectual property assets so identified require a most constructive approach keeping in
view, among others, type of intellectual property assets, the type of business claiming ownership of
intellectual property assets, long term and short term goals of the business organization including
intended/possible use of intellectual property assets
...
The most important among others
being the infringement of rights in intellectual property, the risk management strategy should take into
consideration the situations where company’s own Intellectual Property Rights (IPRs) may infringe the IPRs
of a third party; the company has a valid claim of infringement against a third party
...
One of the most important IPR risk management techniques, particularly in respect of trade secrets, is to put
in place a system requiring all new employees and consultants to execute a confidentiality agreement
...
In nutshell, effective management of Intellectual Property enables companies to use their intellectual
property to improve their competitiveness and strategic advantage
...
Effective intellectual property management requires a company to commercialize its inventions and
effectively monitor and enforce its intellectual property rights
...
Thus,
effective management of intellectual property may be seen as critical business strategy to maintain
sustainable corporate growth and maximisation of shareholder value resulting into the economic growth
...
It is often the key objective in mergers and acquisitions and knowledgeable companies are
increasingly using licensing routes to transfer these assets to low tax jurisdictions
...
Accounting standards are generally not helpful in representing the worth of IPRs in company
accounts and IPRs are often under-valued, under-managed or under-exploited
...
For a better understanding of the IPRs of a company, some of the questions to be
answered should often be:
•
What are the IPRs used in the business?
•
What is their value (and hence level of risk)?
•
Who owns it (could I sue or could someone sue me)?
•
How may it be better exploited (e
...
licensing in or out of technology)?
•
At what level do I need to insure the IPR risk?
One of the key factors affecting a company’s success or failure is the degree to which it effectively exploits
intellectual capital and values risk
...
Exploitation of IPRs can take many forms, ranging from outright sale of an
asset, a joint venture or a licensing agreement
...
Valuation is, essentially, a bringing together of the economic concept of value and the legal concept of
property
...
The cardinal rule of commercial valuation is: the value of something cannot be stated
in the abstract; all that can be stated is the value of a thing in a particular place, at a particular time, in
particular circumstances
...
This rule is particularly significant as far as the valuation of intellectual property rights is concerned
...
Failure to take these circumstances, and those of the owner, into account will
result in a meaningless valuation
...
This is not the case with
intangibles such as know how, (which can include the talents, skill and knowledge of the workforce), training
systems and methods, technical processes, customer lists, distribution networks, etc
...
With many
intangibles, a very careful initial due diligence analysis needs to be undertaken together with IP lawyers and
in-house accountants
...
Owner
value often determines the price in negotiated deals and is often led by a proprietor’s view of value if he were
deprived of the property
...
The fair value
concept, in its essence, is the desire to be equitable to both parties
...
Tax value has been the subject of case law worldwide since the turn of the century and is an esoteric
practice
...
METHODS FOR THE VALUATION OF INTANGIBLES
Acceptable methods for the valuation of identifiable intangible assets and intellectual property fall into three
broad categories
...
In an ideal situation, an independent expert will always prefer to determine a market value by reference to
comparable market transactions
...
In valuing an item of intellectual
property, the search for a comparable market transaction becomes almost futile
...
There are
other impediments that limit the usefulness of this method, namely, special purchasers, different negotiating
skills, and the distorting effects of the peaks and troughs of economic cycles
...
Cost-based methodologies, such as the “cost to create” or the “cost to replace” a given asset, assume that
there is some relationship between cost and value and the approach has very little to commend itself other
than ease of use
...
The methods of valuation flowing from an estimate of past and future economic benefits (also referred to as
the income methods) can be broken down in to four limbs;
(1) capitalization of historic profits,
(2) gross profit differential methods,
(3) excess profits methods, and
(4) the relief from royalty method
...
The capitalization of historic profits arrives at the value of IPR’s by multiplying the maintainable historic
Lesson 13
Management and Valuation of Intellectual Property 237
profitability of the asset by a multiple that has been assessed after scoring the relative strength of the IPR
...
While this capitalization process recognizes some of the factors which should be considered, it
has major shortcomings, mostly associated with historic earning capability
...
2
...
These methods
look at the differences in sale prices, adjusted for differences in marketing costs
...
This
formula is used to drive out cashflows and calculate value
...
3
...
This is used to calculate the profits that are required in order to
induce investors to invest into those net tangible assets
...
While theoretically
relying upon future economic benefits from the use of the asset, the method has difficulty in adjusting to
alternative uses of the asset
...
Relief from royalty considers what the purchaser could afford, or would be willing to pay, for a licence of
similar IPR
...
Discounted Cash Flow (“DCF”) Analysis sits across the last three methodologies and is probably the most
comprehensive of appraisal techniques
...
DCF mathematical modelling allows
for the fact that 1 Euro in your pocket today is worth more than 1 Euro next year or 1 Euro the year after
...
The discount rate is used to calculate economic value and includes compensation for risk and
for expected rates of inflation
...
The projection of market revenues will be a critical step in
the valuation
...
This method recognizes market conditions, likely performance and potential, and the
time value of money
...
The discount rate to be applied to the cashflows can be derived from a number of different models, including
common sense, build-up method, dividend growth models and the Capital Asset Pricing Model utilising a
weighted average cost of capital
...
These processes lead one nowhere unless due diligence and the valuation process quantifies remaining
useful life and decay rates
...
This process is necessary because, just like any other asset, IPRs have a
varying ability to generate economic returns dependant upon these main lives
...
However, the fact that the legal life of a patent is 20 years may be
very important for valuation purposes, as often illustrated in the pharmaceutical sector with generic
competitors entering the marketplace at speed to dilute a monopoly position when protection ceases
...
While some of the above methods are widely used by the financial community, it is important to note that
valuation is an art more than a science and is an interdisciplinary study drawing upon law, economics,
finance, accounting, and investment
...
When undertaking an IPR
valuation, the context is all-important, and the valuer will need to take it into consideration to assign a
realistic value to the asset
...
Generally, the small and medium companies in India either do not
understand the value of their intellectual property assets or are not aware of the intellectual property system
or the protection it can provide for their inventions, brands, and designs
...
In this process one of the most important step is to review the existing intellectual
property assets, so as to identify and locate the company’s key intellectual property assets
•
Once the intellectual property assets are identified, it becomes important to determine nature and scope of
the company’s rights in intellectual property assets, which may range from outright ownership to a licenseincluding contingent rights in intellectual property to be developed in future
...
•
Effective intellectual property management requires a company to commercialize its inventions and
effectively monitor and enforce its intellectual property rights
...
•
One of the key factors affecting a company’s success or failure is the degree to which it effectively exploits
intellectual capital and values risk
...
•
Valuation is, essentially, a bringing together of the economic concept of value and the legal concept of
property
...
There are four main value concepts, namely, owner value, market value, fair value
and tax value
...
•
Acceptable methods for the valuation of identifiable intangible assets and intellectual property fall into three
broad categories
...
Lesson 13
•
Management and Valuation of Intellectual Property 239
It is rash to attempt any valuation adopting so-called industry/sector norms in ignorance of the fundamental
theoretical framework of valuation
...
SELF TEST QUESTIONS
These are meant for re-capitulation only
...
1
...
Explain the strategies for effective IPR Management
...
What is valuation? Why is valuation of intellectual property important?
4
...
240 PP-IPRL&P
PROFESSIONAL PROGRAMME
INTELLECTUAL PROPERTY RIGHTS
PP-IPRL&P/2013
TEST PAPERS
This Test Paper set contains three Test Papers
...
The maximum time
allowed to attempt, each paper is 3 hours
...
While writing answers, you should take care not to copy from the study material, text books or other
publications
...
241
242 PP-IL&P
WHILE WRITING THE RESPONSE SHEETS TO THE TEST PAPERS GIVEN AT END OF THIS STUDY
MATERIAL, THE STUDENTS SHOULD KEEP IN VIEW THE FOLLOWING WARNING AND DESIST
FROM COPYING
...
A few cases of
impersonation by handwriting while answering the response sheets have also been
brought to the Institute’s notice
...
The
students are, therefore, strongly advised to write response sheets personally in their own
hand-writing without copying from any original source
...
The text
of regulation 27 is reproduced below for information:
“27
...
Explanation - Misconduct for the purpose of this regulation shall mean and include
behaviour in a disorderly manner in relation to the Institute or in or near an Examination
premises/centre, breach of any regulation, condition, guideline or direction laid down by
the Institute, malpractices with regard to postal or oral tuition or resorting to or attempting
to resort to unfair means in connection with the writing of any examination conducted by
the Institute"
...
1
...
An invention may satisfy the condition of novelty, inventiveness and usefulness but it may not
qualify for a patent
...
Who checks the novelty features of the invention?
(10 marks)
3
...
How
does a patent document help in R&D?
10 marks)
4
...
TRIPS Agreement obliges member states to patent micro-organisms
...
How the
requirement of sufficiency of disclosure is met in the case of micro-organisms?
(10 marks)
6
...
What do you mean by performer’s right? What are the exclusive rights of a performer?
(10 marks)
8
...
Who can apply for the registration of a geographical indication? What is the benefit of registration of
geographical indications? Who is a registered proprietor of a geographical indication?
(10 marks)
244 PP-IL&P
TEST PAPER 2/2013
Time Allowed: 3 hours
Maximum Marks: 100
NOTE: Answer all questions
...
What is the significance of intellectual property management?
2
...
(10 marks)
((10 marks)
3
...
What are the grounds for refusal of registration of a trade mark?
(10 marks)
5
...
Why one should access the patent literature? What are the various on-line databases available
that provide access to patent documents while conducting patent search?
(10 marks)
7
...
(10 marks)
8
...
Can copyright be assigned? If so, what is the mode of assignment of the copyright?
(10 marks)
10
...
1
...
Comment
...
What is copyright? Why should copyright be protected? What are the classes of works for which
copyright protection is available in India?
(10 marks)
3
...
What does the term 'Geographical Indications (GI)' stand for? Who can apply for GI's registration,
and who is a registered proprietor of a geographical indication?
(10 marks)
5
...
Is registration of the work
compulsory under the Copyright Act?
(10 marks)
6
...
(5 marks each)
7
...
(10 marks)
8
...
(10 marks)
9