civil and criminal remedies analysis

PROJECT ON

CIVIL AND CRIMINAL REMEDIES: A

COMPARATIVE ANALYSIS

Project Submitted To

Ms.Kuhu Tiwari

Faculty- Intellectual Property Rights

Submitted By- Akif Abidi

VII Semester

B.A.LL.B. (Hons.)

ROLL NO. 14

Submitted On- 09th October 2014

____________________________________________________________________________________________________________________________________________________________________________________________________________________________________

HIDAYATULLAH NATIONAL LAW UNIVERSITY,

RAIPUR, CHHATTISGARH.

| P a g e

PROTECTION OF CHARACTERS UNDER THE COPYRIGHT REGIME

ACKNOWLEDGEMENT

This is a sincere expression of gratitude to all those who have helped me complete this project and who

offered every possible help to carry forward the intense magnitude of research involved. I am indebted

to my faculty advisor Ms. Kuhu Tiwari for allowing me to work upon this extremely relevant topic.

I am also thankful to all my friends and family members who have given valuable suggestions pertaining

to the topic and have been a constant source of help and support without which completion of this

project to a refined degree would have been an uphill task.

Thank You.

AKIF ABIDI

Roll no 14

INTELLECTUAL PROPERTY RIGHTS (COPYRIGHT)2 | P a g e


DECLARATION

This is to certify that project report titled “CIVIL AND CRIMINAL REMEDIES : A COMPARATIVE ANALYSIS”

which is submitted by me comprises only my original work and due acknowledgment has been

made in the text to all other materials used.

Akif Abidi



METHODOLOGY

The method of research for the project is doctrinal and the author has basically relied on the

secondary sources of research like books, internet and other such resources.



TABLE OF CONTENTS

TITLE PAGE NO.

LIST OF ABBREVIATIONS & ACRONYMS 6

INTRODUCTION 9

ENFORCEMENT OF TRADEMARK RIGHTS 16

CIVIL AND CRIMINAL REMEDIES UNDER COMMON LAW 24

CRIMINAL IMPLICATIONS OF TRADEMARK INFRINGEMENT 33

CHANGING SCENARIOS 36

CONCLUSION 39

BIBLIOGRAPHY 41



LIST OF ABBREVIATIONS& ACRONYMS

&………………………………………………………….…………………………………and

A.C. …………………...……………………………Law Reports, Appeal Cases (Third Series)

AIR…………………………………………………………………………...All India Reporter

All. ER……………………………….…………………………………...All England Reporter

All……...……………………………………………………………………………..Allahabad

ALR……………………………………………………………………..American Law Review

App Div……………………………………………………...………………Appellate Division

App……………………………………………………………………….……………Appellate

Beav.…………………………………………………………...…Beavan’s Rolls Court Report

Bom……………………………………………………………………..………………Bombay

Bom……………………………………………………………………………………..Bombay

C.L.R……………………………………………………………………Common Law Review

Cal………………………………………………………………………………………Calcutta

Cas……………………………………………………………...……………………….….Case

Cf……………………………………………………………………………….Cross Reference

Ch D..……………………………………………………………………….Chancery Division

Ch………………………………………………………………………………………..Chapter

Cir.…………………………………………………………………………………...…Circular

CLJ………………………………………………………………..……......Common Law Journal



Co………………………………………………………………………………………...Company

Comm…………………………………………………………………...…….……....Commentary

Corp……………………………………………………………………………………Corporation

Del………………………….…………………………………………………………………Delhi

Dept……………………………………………………………………………………Department

DLT………………………………………………………………...…………….Delhi Law Times

E.C.R. ……………..………………………………………………........European Council Review

E.I.P.R………………………………………….………….European Intellectual Property Review

F. Supp….…………………………………………………….……………….Federal Supplement

F.S.R…………………………………………………………….……………..Fleet Street Reports

H.L…………………………………………………………………………………House of Lords

Hrs. ……………………….………………………………………….………………………Hours

Inc…………………………………………………………………………………………Inclusive

IST…………...…..…………………………………………………………..Indian Standard Time

JIPR………………………………………………………..Journal of Intellectual Property Rights

K.B…...………...…………………………………………….………………………King’s Bench

L Ed……………………………………...United States Supreme Court Reports, Lawyers Edition

L. R……………………………………………………………………………….……Law Report

L.Q.R. ………………..……………………….………………………...London Quarterly Review

Ltd. ……………………………………………………………………………………...…Limited

N.J…………………………………………………..……………………..…New Jersey Reports



NYS2d………………………………………………..……….New York Supplement, 2nd Series

Pvt……………………………………………………..…………………………...………private

Q.B….…..………………………………………………..……………………….Queen’s Bench

Rep..……………………...………………………………..……………………….representative

S Ct………………………………………………………Supreme Court Reporter(United States)

s….……………………………...………………………………………………………….Section

SC…………………………………………………………..……………………..Supreme Court

SCC……………………………………………………………..………….Supreme Court Cases

SCR..……………………………………………………………………Supreme Court Reporter

Sept. .………………………………………..………………………………….……...September

Supp…....……………………………………………………………………….…Supplementary

v….……...…………………………………………………………………….……………versus

W.L.R……………………………………………………………….………..Wales Law Review

WL…………………………………………………………………………..Westlaw Transcripts

www………………………………………………………………………..……world wide web

Wyo……………………………………………………………………..…….Wyoming Reports



INTRODUCTION

India’s obligations under the TRIPS Agreement for protection of trademarks, inter alia, include

protection to distinguishing marks, recognition of service marks, indefinite periodical renewal of

registration, abolition of compulsory licensing of trademarks, etc.

With the globalization of trade, brand names, trade names, marks, etc. have attained an immense

value that require uniform minimum standards of protection and efficient procedures for

enforcement as were recognised under the TRIPS. In view of the same, extensive review and

consequential amendment of the old Indian Trade and Merchandise Marks Act, 1958 was carried

out and the new Trade Marks Act, 1999 was enacted. The said Act of 1999, with subsequent

amendments, conforms to the TRIPS and is in accordance with the international systems and

practices.

The Trade Marks Act provides, inter alia, for registration of service marks, filing of multiclass

applications, increasing the term of registration of a trademark to ten years as well as recognition

of the concept of well-known marks, etc. The Indian judiciary has been proactive in the

protection of trademarks, and it has extended the protection under the trademarks law to Domain

Names as demonstrated in landmark cases of Tata Sons Ltd. v. Manu Kosuri & Ors1, and

Yahoo Inc. v. Akash Arora2.

India, being a common law country, follows not only the codified law, but also common law

principles, and as such provides for infringement as well as passing off actions against violation

of trademarks. Section 135 of the Trade Marks Act recognises both infringement as well as

passing off actions.

1 [90 (2001) DLT 659]2 [1999 PTC 201]



Well-known Trademark and Trans Border Reputation

India recognises the concept of the “Well-known Trademark” and the “Principle of Trans Border

Reputation”. A well-known Trademark in relation to any goods or services means a mark that

has become so to the substantial segment of the public, which uses such goods or receives such

services such that the use of such a mark in relation to other goods and services is likely to be

taken as indicating a connection between the two marks.

Trans Border Reputation concept was recognised and discussed by the Apex Indian Court in the

landmark case of N. R. Dongre v. Whirlpool3. The Trademark “WHIRLPOOL” was held to

have acquired reputation and goodwill in India. The Mark “WHIRLPOOL” was also held to

have become associated in the minds of the public with Whirlpool Corporation on account of

circulation of the advertisements in the magazines despite no evidence of actual sale. Hence, the

trademark WHIRLPOOL was held to have acquired trans-border reputation which enjoys

protection in India, irrespective of its actual user or registration in India.

Intellectual property (IP) is the term that describes the ideas, inventions, technologies, artworks,

music and literature, that are intangible when first created, but become valuable in tangible form

as products. Intellectual properties are the creations of the mind: inventions, literary and artistic

works, and the symbols, names, and designs used in commerce. The rationale for the

establishment of a legal framework on IPRs is that it is a signal to society that creative and

inventive ideas will be rewarded.

IP system is being integrated into the knowledge economy, and posing interesting challenges to

industry, government policy-makers, scholars, and researchers in both developed and developing

countries.

The IPRs and India It is a well-known fact that the role of Intellectual Property (IP) protection

has expanded at an unprecedented pace during the last two decades. In the process IP rights have

been modified or new provisions have been created in order to cover new areas of Science &

Technology, such as Information Technology, Biotechnology, and now service sector. It may be

observed that World Trade Organization (WTO) agreement on Trade-Related Aspects of

3 (1996) 5SCC 714



Intellectual Property Rights (TRIPs) has extended minimum standards for IP Protection globally.

There are continuing discussions in World Intellectual Property Organization (WIPO) aimed at

further harmonisation of the Patent system. Moreover, agreements between Developed and

Developing countries also include mutual commitments to implement IP regimes that go beyond

TRIPS minimum standards. Hence,

India is under pressure to increase the levels of IP protection in our own regime, based on

standards in developed countries. In one dimension it is observed that IPRs help stimulate

economic growth and reduce poverty in developed countries, but the same concept may not do

the same in developing countries. However, IP rights can do little to stimulate inventions in

countries like India. The ownership of Intellectual property is a crucial issue that impacts market

position and profitability of industries. India is realizing this fact and this is evident from India’s

number 3 position in Patent Cooperation Treaty (PCT) filings and its highest growth rate of 50%

in the segment of developing countries. The changes in the IPR regime have necessitated

technological self-reliance, as borrowing of technology from developed countries will no longer

be economically viable. Our country is rich in genetic resources and traditional knowledge,

which are of great value to us and to the world at large but we lack desired efforts to protect and

exploit them. Historically, developed countries used IP protection as a flexible instrument to help

promote their industrialisation. Strong evidence suggests that certain types of companies in

developed countries, particularly in the field of pharmaceutical industry consider IPR as essential

in promoting essential.

Intellectual property (IP) is the term that describes the ideas, inventions, technologies, artworks,

music and literature, that are intangible when first created, but become valuable in tangible form

as products. Intellectual properties are the creations of the mind: inventions, literary and artistic

works, and the symbols, names, and designs used in commerce. The rationale for the

establishment of a legal framework on IPRs is that it is a signal to society that creative and

inventive ideas will be rewarded.

IP system is being integrated into the knowledge economy, and posing interesting challenges to

industry, government policy-makers, scholars, and researchers in both developed and developing

countries



IP as a general term refers to the subject matter of the laws that give rise to proprietary interests

in creations of the mind. That is, it refers to intangibles that arise and derive their intrinsic value

out of innovative or creative activities. The various tools of IPR that are used to protect

innovations are Copyrights, Industrial Designs, Data Protection, Geographical Indications, Patent

and Trademark.

Copyright

It is concerned with Protection of creative works that are musical, literary, artistic, lectures,

plays, art reproductions, models, photographs, computer software, etc. It is valid for the lifetime

of the author and minimum 50 years after the death of the author. Copyright Issues are handled

by Department of Book Promotion & Copyrights, Ministry of Human Resource Development. It

is an important area of IP because it is one of the means of promoting, enriching and

disseminating the national cultural heritage. India has a very strong and comprehensive copyright

law. The 1999 amendments have made the Copyright Act fully compatible with Trade-Related

Aspects of Intellectual Property Rights (TRIPS) Agreement. With these amendments the Indian

Copyright Law has become one of the most modern copyright laws in the world. Moreover, India

is signatory to both the International copyright conventions i.e. the Berne Convention of 1886

and Universal Copyright Convention of 1952. India is also an active member of World

Intellectual Property Organization (WIPO) and United Nations Educational, Scientific and

Cultural Organization (UNESCO). Countries like India offer an abundance of cultural heritage to

the world. These can be protected, within the framework of copyright legislation. Such

protection is called the protection of neighbouring rights.

Patent

It pertains to pragmatic innovations and aims to protect inventions that are novel, non obvious

and useful. Patents are given only for inventions. Inventions are solutions to specific problems in

the field of technology. An invention may relate to a product or a process. Patents have a term of

20 years from the date of filing a complete specification. In order to get a patent for an invention,

the invention has to be patentable. India is most concerned for product patents, which bring food,

drugs, and medicinal inventions into the purview of palatability.



Trademark

It is related to commercial symbols and concern to Protect distinctive marks such as words/signs

including personal names, letters, numerals, figurative elements (logos); devices; visually

perceptible two or three dimensional signs/shapes or their combinations; audible signs (sound

marks) e.g. the cry of an animal or laughing sound of a baby; olfactory marks (smell marks), use

of certain fragrance.

Some countries have also registered sounds and distinctive smells as trademarks. It can be

perpetually renewed from time to time. Trademarks started to play an important role with the

onset of industrialisation, and they have since become a key factor in the modern world of

international trade and market-oriented economies.

The latest amendments also include the concept of ‘service marks’. Service marks are trademarks

used in the services sector like hotels, laundry, education, airlines, and IT enabled services. 4

Interestingly, India has one of the most well advanced trademarks laws. India has taken steps

towards fulfilling its international obligations. Consequently, the Indian trademark law has now

become fully compatible with the International standards laid down in the TRIPs Agreement.

The New Act primarily consolidates and amends the old Trade & Merchandise Marks Act, 1958

and provides for better protection of goods and services. Industrial Designs: It protects novel

non-functional features of shape, configuration, pattern, ornamentation or composition of lines or

colours, applied to any article either two or three dimensional or in both forms by any industrial

process or means whether manual, mechanical or chemical, separate or combined which in the

finished article appeal to and is judged solely by the eye. This registration has a specific term

(initially 10 years and renewable for another term of 10 years).5

Geographical Indications (GI)

Geographical Indications of Goods are defined as that aspect of industrial property, which refers

to the country or to a place of origin of that product. Typically, such a name conveys an

assurance of quality and distinctiveness of the product, which is essentially attributable to the

4 JayashreeWatal, “Intellectaul Property in Indian Agriculture”, sourced from www.icrier.org/pdf/jayashree5 Kamil Idris, Intellectual Property : A Power Tool for Economic Growth , “The Process of Economic Growth”, sourced from www.wipo.int/about-wipo/en/dgo/wipo_pub_888/pdf/wipo_pub_888_chapter



fact of its origin in that, defined geographical locality, region or country. The term is initially for

a period of 10 years and can be renewed perpetually.

Before the TRIPs, GI was not protected in India. Since then, the enactment of a separate law ‘the

Geographical Indication of Goods (Registration & Protection) Act, 1999’ addressing GI has

given the necessary impetus to the effort of Indian exporters to protect GI attached to the goods.

GI could also be used, in certain instances, for products that incorporated traditional knowledge

such as Indian NEEM, Tulsi, Haldi, Jamun, Kesar and so on. Such issues of GI are handled by

Department of Industrial Policy & Promotion, Ministry of Commerce & Industry. GI can become

a very powerful competitive tool for the communities to collectively get involved in the

manufacturing and marketing of agricultural goods, foodstuff, handicrafts, traditional arts, etc. In

India this area of IPR is not fully developed and exploited.6

Data Protection

Concerning pharmaceutical and agricultural test data, it is related to Protection of undisclosed

information such as Strategies and Trade secrets. Discussion on various components/Tools of

IPR that are used to Protect innovations won’t be complete without a discussion on the way the

ideas have converted into intellectual property and the way they can be efficiently managed the

process flow of Mind to Market.7

Relief in the form of damages is one of the remedies available in claims of tortious liability.

Damages are the sum of money, which a person wronged, is entitled to receive from the

wrongdoer as compensation for the wrong. The general rule in fixing the sum to be given as

damages is that, it should as close as possible to that amount which will put the injured party in

the same position as he would have been in, if he had not sustained the wrong for which he is

getting compensation.8

6 www.questia.com/PM.qst?a=o&se=gglsc&d=50019765507 The Patents Act, 1970 as amended by Patents (Amendment) Act 2005, Commercial LawPublisher (India) Private Ltd., 20058 Pillai Atchuthen P S, Law of Tort, 8th edn (Eastern Book Company, Lucknow), 1987, p. 301, 435



Usually, damages are remedial rather than preventive or punitive. However, in a few instances,

punitive damages in addition to compensatory damages may be awarded. Accordingly, there are

three main categories of damages recognized under law:

1. Compensatory damages

2. Nominal damages, and

3. Punitive damages.

Compensatory Damages

Compensatory damages are awarded with an intention of putting the party who has suffered

injury in the same position as he would have been had the tortious act not been committed. In

case of compensatory damages, the defendant will be liable to the plaintiff for all the natural and

direct consequences of the defendant’s wrongful act but not for remote consequences. This is in

conformity with the earliest rationale behind damages, as conceived under the law of torts.

Nominal Damages

Nominal damages are awarded to the aggrieved party who is able to establish that he or she has

suffered an injury caused by the wrongful conduct of a wrongdoer, but cannot offer proof of a

loss that can be compensated. The amount awarded is generally a small, symbolic sum.

Punitive Damages

Punitive damages are awarded to the aggrieved party in addition to compensatory damages when

the defendant’s conduct is willful, malicious and oppressive. The award of punitive damages is at

the discretion of the courts. In most jurisdictions, punitive damages are awarded, (i) to punish

one guilty of a willful wrong; (ii) to deter the defendant and potential offenders from further

misconduct; and (iii) as an approximate award to plaintiff of his expenses of litigation.9

9 http : //legaldictionary.thefreedictionary.com / damages (15 June 2010).



ENFORCEMENT OF TRADEMARK RIGHTS

Under the Trade Marks Act, both civil and criminal remedies are simultaneously available

against infringement and passing off.

Infringement of trademark is violation of the exclusive rights granted to the registered proprietor

of the trademark to use the same. A trademark is said to be infringed by a person, who, not being

a permitted user, uses an identical/ similar/ deceptively similar mark to the registered trademark

without the authorization of the registered proprietor of the trademark. However, it is pertinent to

note that the Indian trademark law protects the vested rights of a prior user against a registered

proprietor which is based on common law principles.

Passing off is a common law tort used to enforce unregistered trademark rights. Passing off

essentially occurs where the reputation in the trademark of party A is misappropriated by party

B, such that party B misrepresents as being the owner of the trademark or having some

affiliation/nexus with party A, thereby damaging the goodwill of party A. For an action of

passing off, registration of a trademark is irrelevant.

Registration of a trademark is not a pre-requisite in order to sustain a civil or criminal action

against violation of trademarks in India. In India, a combined civil action for infringement of

trademark and passing off can be initiated.

Significantly, infringement of a trademark is a cognizable offence and criminal proceedings can

be initiated against the infringers. Such enforcement mechanisms are expected to boost the

protection of marks in India and reduce infringement and contravention of trademarks.

Relief granted by Courts in Suits for Infringement and Passing off

The relief which a court may usually grant in a suit for infringement or passing off includes

permanent and interim injunction, damages or account of profits, delivery of the infringing goods

for destruction and cost of the legal proceedings.



The order of interim injunction may be passed ex parte or after notice. The Interim reliefs in the

suit may also include order for:

a) Appointment of a local commissioner, which is akin to an “Anton Pillar Order”, for

search, seizure and preservation of infringing goods, account books and preparation of

inventory, etc.

b) Restraining the infringer from disposing of or dealing with the assets in a manner which

may adversely affect plaintiff’s ability to recover damages, costs or other pecuniary

remedies which may be finally awarded to the plaintiff.

Offences and Penalties

In case of a criminal action for infringement or passing off, the offence is punishable with

imprisonment for a term which shall not be less than six months but which may extend to three

years and fine which shall not be less than INR 50,000 but may extend to INR 200,000.

In India, trademark rights may be acquired through:

use in relation to goods or services;

registration; or

assignment/transmission.

The meaning of the term ‘use’ in relation to trademarks has been developed through case law.

In Hardie Trading Ltd v Addisons Paint & Chemicals Ltd10 the Supreme Court held that

“‘use’ of a trademark is not limited to use on goods sold. It also extends to advertisements”.

Further, in Dongre v Whirlpool Corporation11 the court held that

10 2003 (27) PTC 241 (SC)11 1996 (16) PTC 583



the actual presence of the goods or the actual use of the mark in India is not mandatory and it

would suffice if reputation and goodwill in respect of the mark have accrued in India through

advertising or other means.

Enforcement of trademark rights

The Trademarks Act 1999 provides rights holders with both civil and criminal remedies against

infringement or unauthorized use of a mark. Other remedies are available to rights holders under

the Customs Act 1962, which deals with import/export of goods and confiscation of infringing

materials by the relevant authorities.

Civil remedies

Depending upon whether a trademark is registered, pending registration or unregistered, civil

proceedings can be initiated either under the tort of passing off or for statutory infringement

under the Trademarks Act.

Civil proceedings in India are governed by the Code of Civil Procedure 1908. The general rule is

that a suit can be filed in a court:

where either the defendant or one of the defendants resides or carries on business or

personally works for gain; or

where the cause of action arises, wholly or in part.

Under the old Trademarks & Merchandise Marks Act 1958, the appropriate court for a suit was

determined by the location of the defendant. However, Section 134(2) of the 1999 act allows a

rights holder to file a suit for trademark infringement in the court where the registered proprietor

resides or carries on business or personally works for gain.

A court can grant the following relief under a civil suit:

injunctions;

damages or accounts for profits; and



delivery up of the infringing labels and marks.

Indian courts regularly grant Anton Piller, John Doe and, occasionally, Mareva injunctions, and

may appoint court commissioners to inspect a defendant’s premises, as well as seize and seal

infringing goods.

When considering applications for ex parte, interim orders, Indian courts are guided by:

the balance of convenience;

whether the plaintiff will suffer irreparable harm should the order not be issued; and

whether there exists a prima facie case.

In Wander Ltd v Antox India P Ltd12, the Supreme Court observed that:

“The object is to protect the plaintiff against injury by violation of his rights for which it could

not adequately be compensated in damages recoverable in the action if the uncertainty were

resolved in its favour at the trial.”

In the same case the court further observed that:

“The need for such protection must be weighed against the corresponding need for the defendant

to be protected against injury resulting from its having been prevented from exercising its own

legal rights for which it could not be adequately compensated. The court must weigh one need

against another and determine where the balance of convenience lies.”

In Patel v Shah13 the Supreme Court made the following observations with regard to actions for

passing off:

it is usual, rather than essential, to seek a temporary injunction;

proof of actual damage is not essential, likelihood of damage is sufficient; and

12 1990 Supp (1) SCC 72713 (2002) 3 SCC 65



an absolute injunction can be issued restraining the defendant from using or carrying on

business under the plaintiff’s distinctive trademark.

Limitation/delay

Since passing off or trademark infringement usually involves a series of acts, each infringing act

provides a fresh cause of action. Thus, the general rule of limitation, which provides that a

complaint must be filed within three years of the date upon which the cause of action first arose,

does not apply in such cases. However, prompt action by rights holders will help to establish the

seriousness of a claim in the eyes of the court.

In Midas Hygiene Industries P Ltd v Bhatia14, the Supreme Court held that:

“…in cases of infringement either of trademark or of copyright normally an injunction must

follow. Mere delay in bringing the action is not sufficient to defeat grant of injunction in such

cases… The grant of injunction also becomes necessary if it prima facie appears that the

adoption of the mark itself was dishonest”.

Criminal remedies

The Trademarks Act provides for criminal remedies against the falsification or false application

of a trademark and the use of false trade descriptions. Criminal sanctions include imprisonment

for a term ranging between six months and three years, and/or fines of between Rs50,000 and

Rs200,000.

Any police officer above the rank of deputy superintendent, if he or she is satisfied that a

trademark offence has been, is being, or is likely to be, committed, has the power to search and

seize infringing articles without warrant. Such an officer is empowered to seize not only the

offending goods, but also dies, blocks, machines, plates and other instruments or equipment

involved in committing the offence.

14 (2004) 3 SCC 90



However, before making the search and seizure, the officer is required to obtain the opinion of

the registrar of trademarks on the facts involved in the offence. Such requirement has been

criticized for causing unwarranted delays and can be bypassed by filing a complaint with the

magistrate to obtain directions to investigate and conduct search and seizure operations against

the infringer(s) (whether known or unknown).

Border control measures

Rights owners can now record their registered trademarks with the customs authorities under the

Intellectual Property Rights (Imported Goods) Enforcement Rules 2007 notified under the

Customs Act 1962.

These guidelines authorize customs officials to seize infringing goods at the border without the

need for a court order. Under these rules, the rights holder may give notice in writing of

suspected infringing goods to the commissioner of customs or any other customs officer

authorized by the commissioner at the port of import requesting the suspension of clearance of

the goods.

Provided the registration remains valid, the customs authorities will prevent the importation of

goods infringing that mark. Customs authorities have the power to suspend the clearance of

prohibited goods either on information received by the rights holder or on their own initiative,

provided they have prima facie evidence or reasonable grounds to believe that the imported

goods infringe the recorded mark.

These rules also allow for destruction of goods or disposal outside the normal channels of

commerce after a determination that the goods infringe the recorded trademark and when no

legal proceeding is pending in relation to such determination. They also prohibit the re-

exportation of the infringing goods in an unaltered state. Choosing the correct enforcement

strategy

Enforcement measures should be based on the results of an efficient investigation, as this is

critical to ascertain the existence of a prima facie case, likely defences and important details such

as:



the extent of the infringer’s right to the use of a potentially infringing trademark and

whether such use is in good faith;

the extent and duration of the infringing activity;

the position of the suspected infringer within the distribution network (ie, manufacturer,

packer, wholesaler, importer or retailer);

the identity of any connected parties; and

the financial standing and assets of the infringer.

The choice of civil and/or criminal remedies also depends upon the location and nature of the

infringing activities. If, for instance, piracy is found to be ‘institutionalized’ in a market complex,

civil proceedings may be ineffective in terms of cost as well as results, given the organized

nature of the infringers.

It is worth noting that not all courts in India may be inclined to grant ex parte injunction or

seizure orders. Thus, careful selection of venue and the nature of the action, including

considerations as to the rights holder’s ability to control or exit the litigation, will play an

important role in determining the success of a campaign.

While at first flush criminal action may appear attractive given the tough remedies available,

such as seizure, arrest, detention of goods and participation of the defendant in hearings by force

of law, various factors weigh against this type of action. These include the following:

lack of IP awareness at prosecution and law enforcement level, making it exceptionally

difficult to prove IP infringement, often resulting in acquittals;

corruption;

in the case of a criminal prosecution, the rights holder must ensure the availability of the

complainant in whose name the action was filed, along with investigators/witnesses, for



the duration of the proceedings, which may take anything between three and six years;

and

the complicated exit mechanisms for complainants (the first information report – the

complaint filed by the IP owner – cannot be withdrawn during magisterial court

proceedings; instead, it must be quashed by the local High Court).

Although specialized ‘IP enforcement units’ have been set up in many states to deal with cases of

IP infringement, such units have not proved very effective and have made no real headway. An

enforcement strategy ultimately cannot ignore the importance of internal checks and balances to

prevent overspills from licensed manufacturing units in India.

Moreover, rights holders must apply authentication devices, such as holograms, and innovative

packaging methods on original products to thwart infringement.

The best strategy is to take a ‘layered approach’ to enforcement. Large-scale civil and criminal

actions against the main sources of infringement should be complemented by the use of cease

and desist letters and public notices to propagate a zero-tolerance stance. The deterrent effect of

such policy can be bolstered by border control measures and coordination with law enforcement

officials to encourage them to investigate leads provided by the IP rights owner. Lastly, seeking

public apologies from infringers helps to pressurize them into looking at alternative business

models.

While improvements to the enforcement regime are needed, a carefully planned enforcement

strategy can achieve results in India.

Judges in civil cases have the right to order injunctions on those that commit trademark

infringement. The defendant must follow through with this remedy. The defendants must sign,

under oath, the plan of action they will take to remove the infringed trademark from wherever

they were using it. The report detailing the plan to remove the infringed trademark must be

completed and returned to the court within thirty days, or any other length of time set by the

judge. Those who violate the injunction will be charged with contempt of court. The court also

has the right to seize any property relating to the trademark infringement case.



Remedies for Violation of Rights

Remedies for trademark infringement may include lost profits, damages and attorney fees. When

a violation of registered trademarks takes place and it is believed to have been an intentional

infringement, a judge may award a plaintiff money from the defendant regarding any lost profits

resulting from the infringement. If the infringement damaged the public perception of a company

because of the actions of the infringing party, monetary damages can be awarded for that action

as well.

The cost of court action may be awarded when factoring in the losses of the plaintiff and gains

made by the defendant. The monetary value awarded to the plaintiff is typically more than the

amount gained by the defendant but cannot exceed three times the sum of all illegally obtained

profits. In some cases, the plaintiff is asked to pay some of their own court fees despite winning

the suit against the defendant. If a defendant tries to pose as the plaintiff using a counterfeit

marking, the sum of all profits shall be multiplied by three and awarded to the plaintiff.

Remedies for Dilution

Anyone that uses a registered trademark in anyway that misleads consumers as to who owns the

trademark or who or what it represents can be acted on in a civil trial. The person who has been

damaged by the person diluting the trademark will be the plaintiff in a civil trial.

Any products that are imported into the United States are not free from civil action if they dilute

a trademark. Injunctions are the most common remedy for dilution or a famous trademark.

Monetary damages are usually not awarded unless there was intentional harm brought on by a

defendant.

CIVIL AND CRIMINAL REMEDIES UNDER COMMON LAW

The legal nature of IPRs determines what English law remedies are available for their

infringement. With the exception of rights in confidential information, IPRs are a form of

personal moveable property. They are often described as being ‘incorporeal’ as they cannot be

seen or touched.



This legal classification is set out for patents in the Patents Act 1977, s 30(1) (PA 1977, s 30(1)),

for trade marks in the Trade Marks Act 1994, ss 22, 24(1) (TMA 1994, ss 22, 24(1)), for

registered designs in the Registered Designs Act 1949, ss 15A, 15(B) (1) (RDA 1949, ss 15A,

15(B)(1)), for copyright in the Copyright, Designs and Patents Act 1988, ss 1(1), 90(1) (CDPA

1988, ss 1(1), 90(1)) and for UK unregistered design right in sections CDPA 1988, ss 213(1),

222(1)15.

Community IPRs (such as community trade marks and community designs) owned either by an

entity domiciled in the UK or by an entity not domiciled in any EU Member but with an

establishment in the UK are also personal moveable property16.

In Oxford v Moss17 it was held that “Information is not property under English law and thus it

can not be stolen. However, the confidentiality of information can be protected by an action for

breach of confidence, which is based on the enforcement of an equitable obligation of good faith

rather than a property right in the information”.

Remedies in private civil actions

The remedies available to a successful claimant in a private civil infringement action include:

an injunction

an award of costs

damages or an account of profits

delivery up/destruction of infringing items and items used to make them

tracing orders

The injunction

15 PA 1977, s 30(1), TMA 1994, ss 22, 24(1), RDA 1949, ss 15A, 15(B)(1), CDPA 1988, ss 1(1), 90(1), 213(1), 222(1)16 Council Regulation (EC) 6/2002, art 27(1), Council Regulation (EC) 207/2009, art 16(1)17 (1978) 68 Cr App Rep 183, [1979] Crim LR 119.



IPRs are essentially negative in character: they all confer on their owners the right to stop others

doing certain things, without the rights owner’s consent.

The practical manifestation of this ability to stop infringers is the prohibitory injunction. A

prohibitory injunction is an order, made by a court, requiring a named individual or individuals

to refrain from doing certain defined acts, which are the exclusive preserve of the IPR owner. In

most IPR infringement cases the prohibitory injunction is by far and away the most important

remedy in practice.

The High Court’s power to grant injunctions is conferred by the Supreme Court Act 1981, s 37

(SCA 1981, s 37). Since the County Courts Act 1984, s 38 (CCA 1984, s 38) was amended by

the Courts and Legal Services Act 1990, county courts have had the same power as the High

Court to grant injunctions and for this reason the jurisdiction of the Patents County Court to grant

injunctions in IP cases is co-extensive with that of the High Court. The rules as to which judges

can grant injunctions are set out in the relevant practice direction.18

There is no automatic entitlement to an injunction: CCA 1984, s 38(1) and SCA 1981, s 37(1)

state that such injunctions should be granted if it is just and convenient to do so.19

The Human Rights Act 1998 (HRA 1998) imposes an obligation on courts in the UK to give

effect to legislation in a manner which is compatible with human rights.

Following the decision of the Supreme Court in South Bucks District Council v Porter20 as to

the applicability of the European Convention on Human Rights in the context of the granting of

injunctions, it is now clearly also necessary for a Court to consider whether the grant of a

prohibitory injunction is proportionate.21

If, notwithstanding the grant of an injunction, the restrained party carries out a prohibited act,

that would amount to a contempt of court, which could lead to fines or imprisonment.

The interim injunction

18 CPR PD 2B, para 2.1, 8.1, SCA 1981, s 37, CCA 1984, s 3819 CCA 1984, s 38(1), SCA 1981, s 37(1)20 [2004] 4 All ER 77521 HRA 1998, ss 3(1), 6(1), 6(2)



An IP owner does not have to wait until it wins on liability at trial to secure an injunction: it can,

in certain circumstances, obtain such an injunction on an interim emergency basis, usually

pending a full trial of the matter. The principles on which such an injunction are granted are set

out in the Supreme Court decision of American Cyanamid Co v Ethicon Ltd22. Laddie J’s

decision in Series 5 Software Ltd v Clarke and others23 provides some more modern guidance

as to how the American Cyanamid principles are to be applied in practice.

Territorial effect

The territorial effect of an injunction made by an English court is limited to England and Wales,

but such orders can also be registered in the courts of Scotland and Northern Ireland to give

effect to them there. Unlike courts in the Netherlands and Germany, English courts have been

reluctant to hear claims in respect of the infringement of a bundle of national patents flowing

from the same European patent application Coin Controls Ltd v Suzo International (UK) Ltd

and others24.

A patentee with a bundle of national European patents currently has no real option other than to

enforce them on a country by country basis. See the Europe-an Court of Justice decisions in

GAT v Luk25 and Roche v Primus26.

Duration of prohibition

Many injunctions do not specify the duration of the prohibition. Where they do specify the

duration it is common to refer to the duration of the infringed IPR. Where licences of right are

available (as for example for UK unregistered design right under CDPA 1988, s 237), provision

needs to be made for such licences of right in the form of the order. Injunctions can be granted

for a ‘springboard period’ beyond the expiry of the term of underlying right, where to do so is

just in all the circumstances to deprive an infringer of an advantage he illegitimately built up

during a period when the IPR was in force. The position was laid clear in the case of Dyson

Appliances Ltd v Hoover Ltd (No 2).27 22 [1975] 1 All ER 50423 [1996] 1 All ER 85324 [1997] 3 All ER 4525 (Case C-4/30)26 (Case C-539/03) [2006] All ER (D) 186 (Jul)27 [2001] All ER (D) 37 (Jan) CDPA 1988, s 237



Costs

In the UK the general rule is that the losing party pays a proportion (typically two thirds to three

quarters) of the successful party’s costs on the claims on which it has lost. This was reiterated in

the case of Monsanto Technology LLC v Cargill International SA and another.28

In IPR cases, there are often two issues in dispute: infringement of the claimant’s IPRs and their

validity. In patent actions, English courts retain the freedom to apportion the costs between these

two issues so that where the patent in issue was held to be invalid but infringed or alternatively

valid but not infringed, the winner of each issue can have his entitlement to the costs of such

issue offset against his liability to pay his opponent’s costs on the issues on which he himself lost

(and for which he himself therefore cannot recover).

The enforcement of IPRs in the UK is notoriously expensive: for example, the average patent

infringement action in the High Court costs each side approximately £700,000, (source: Lord

Justice Jackson’s Review of Civil Litigation Costs: Final Report, paragraph 8.2, page 24). It is

hardly surprising, therefore, that the possibility of being able to recover a proportion of one’s

costs from the loser in

English legal proceedings is a very important remedy in practice. Indeed, in many UK IP

disputes which reach trial, the amount of costs awarded dwarfs what is recoverable by way of

damages or an account of profits.

To prevent patentees repeatedly losing out on their irrecoverable costs of defending the validity

of their patents, PA 1977, s 65 provides that a court can, at the end of a trial in which validity has

been unsuccessfully challenged, make an order certifying that validity was unsuccessfully

contested. The effect of the making of such an order of contested validity is that in subsequent

proceedings in which validity is again put in issue the successful patentee can recover his costs

of the validity part of an action on the indemnity basis, which is generally much closer to his

actual costs of such action.

Damages or an account of profits

28 [2007] All ER (D) 118 (Oct)



English law has since at least the time of the Middle Ages provided a restitutionary remedy for

the invasion of private property rights: the rights owner is entitled to deprive the infringer of the

unjust enrichment that has accrued to him as a result of his unlawful activities. In the context of

IPRs this leads to the remedy of an account of profits being available: these are the defendant’s

(and not the claimant’s) profits made as a result of his infringement. It is generally considered

that an account of profits is not available for breach of confidence, this was held in the case of

Attorney General v Blake (Jonathan Cape Ltd, third party)29 and Vercoe and others v

Rutland Fund Management Ltd and others.30

As an alternative to restitution, the IPR owner can seek the compensatory remedy of an award of

damages. The aim of an award of damages is to compensate the IPR owner for the invasion of

his rights: the award of a monetary sum is intended to put him back, as far as practicable, in the

position he would have been in if there had been no infringement. The usual tortious rules as to

remoteness and causation apply to limit the amount that can be recovered. This position was laid

down in General Tire and Rubber Co v Firestone Tyre and Rubber Co Ltd31 and Gerber

Garment Technology Inc v Lectra Systems Ltd and another32

An IPR owner can not claim both an account of profits and damages: he must choose one or the

other. In practice after the trial on liability has concluded, the successful IP owner is given a

short period within which to make his election. Often this is done after there has been some

disclosure by the unsuccessful infringer of basic financial information relating to the

infringement, which is intended to enable the IP owner to make a more informed decision.

Additional statutory damages can be awarded for copyright infringement which is flagrant.33

In theory the process of determining what sum should be paid to a successful IPR owner after it

has won an infringement action is determined by a separate litigation process called an enquiry

as to damages, which involves a process similar, in many respects, to trial on liability, with

disclosure, witness statements, expert reports, skeleton arguments and a trial on quantum. In

practice, however, enquiries as to damages are rare, as in the vast majority of cases the parties

29 [2000] All ER (D) 107430 [2010] All ER (D) 79 (Jun)31 [1975] 2 All ER 17332 (1994) IP & T Digest 1533 CDPA 1988, s 97(2) Procedure



successfully reach agreement on the sum to be paid. Few defendants who have lost painfully at a

first trial on liability are prepared to go through a second fully contested bout of litigation on

quantum.

Basis of award

Successful IPR owners are frequently advised to seek damages rather than an account of profits

as it is considered that an infringer will be able to manipulate his profit figure so as to artificially

reduce the profits available. Where a process patent has been infringed the current state of the

law will frequently militate strongly against electing for an account as it mandates that the

amount of profits available to the IPR owner is that proportion of the infringer’s manufacturing

costs represented by the implementation of the infringing process. In a multi-staged

manufacturing process the costs of the patented part of the process may be a tiny fraction of the

overall costs and this would materially impact on the amount of profits available to the patentee,

as happened in Celanese International Corp and another v BP Chemicals and another34

In relation to the calculation of damages a distinction is to be drawn between an IPR owner who

himself exploits the IPR and one who does not. An IPR owner who does not exploit his IPR

himself will only be able to claim, as damages, a licence fee: the fee that would have been paid

by the infringer if it had sought a licence instead of infringing. Where the IPR owner does

himself exploit the IPR, he will be entitled to damages calculated by reference to the profits he

has lost on unmade sales, lost to the infringing competitor and lost because of price depression.

The losses claimed can extend to other items or services that would have been sold in addition to

the item embodying the infringed IP: for example damages can be claimed for consumables,

service and maintenance contracts and other items that would have been sold with the item

embodying the IPR). In relation to damages, it does not matter if the invention is but a small part

of a much larger item.

A successful IPR owner does not have to prove each lost sale on the balance of probabilities to

recover his loss: if he claims to have lost x sales then if the court concludes that he had only a

20% chance of making a each sale, the IPR owner will still be able to recover for the profits lost

34 [1998] All ER (D) 493



on the sale of two such items as the percentage lost chance of making the sales is multiplied by

the total number of sales. Such situations were dealt in the case of Allied Maples Group Ltd v

Simmons & Simmons (a firm).35

See the Sullivan case for a recent case on damages for copyright infringement. The substantive

issue involved a copyright infringement claim by a musician, in respect of a video which had

been posted on YouTube for five days and which, it was calculated, would have been seen by the

defendant film company’s staff plus a maximum of 50 people. Sullivan sought damages of

£800,000 for ‘breach of statutory duty, infringement of copyright and...loss of a chance’. The

claim was transferred to the Chancery Division, where its value was assessed at just £50.

The defendant applied successfully to have the claim struck out on the basis that a claim for such

a small sum was a disproportionate use of the court’s time and resources. This has been followed

from Sullivan v Bristol Film Studios Ltd.36

Delivery up or destruction

There is no automatic entitlement to delivery up or destruction but once infringement is shown,

orders requiring either or both these things will usually be made. UK courts are now required to

take into account the need for proportionality between the seriousness of the infringement and

the remedy ordered and the interests of third parties, under Council Directive (EC) 2004/48 (IP

Enforcement Directive). Where the infringing item is a small part of a larger item, the effect of

the IP Enforcement Directive may be that no order for delivery up will be made.37

In relation to imported items, it is possible for the IPR owner to request that HM Revenue &

Customs (HMRC) detains imports at the UK’s borders goods, which are suspected of infringing

IPR. Providing civil litigation is started within ten days of the detention of such goods, HMRC

will continue to detain them. HMRC makes a daily charge for the storage of such detained goods

which is recoverable as a head of damages against an infringer. For further reading see practice

note: Anti-counterfeiting and customs.38

35 [1995] 4 All ER 90736 [2012] All ER (D) 69 (May)37 Council Directive (EC) 2004/48, art 10(3)38 Council Regulation (EC) 1383/2003 Goods Infringing Intellectual Property Rights (Customs) Regulations 2004, SI 2004/1473



Tracing remedies

An infringer can be ordered to provide details of where he got his supplies of infringing goods.

Failure to provide the information sought in the face of such an order can amount to a contempt

of court. Criminal remedies for IP infringement TMA 1994, s 92 and CDPA 1988, s 107 make it

a criminal offence to make and deal with items that infringe UK and community registered trade

marks and UK copyright. The more serious copyright and trade mark offences carry a maximum

ten year prison term on indictment and/or an unlimited fine.39

Confiscation orders

In criminal cases there is no right to damages as such. However, under the Proceeds of Crime

Act 2002 (POCA 2002) it is possible to seek a confiscation order. The effect of the making of a

confiscation order by a Crown Court is that the defendant’s assets, which were acquired with the

proceeds of crime, are confiscated. If a confiscation order is made the onus is on the convicted

defendant to prove that all his assets, acquired in the six years leading up to conviction, were

acquired lawfully. If he cannot, such assets become liable to confiscation. Under POCA 2002, s

13(5), those who have been financially disadvantaged by a criminal enterprise (such as a brand

owner in a counterfeiting case) can apply to court for compensation out of confiscated assets.

The police and the courts also have rights to such funds.

The costs advantages of private prosecutions

For a claimant to recover his costs of a civil case, he must be awarded his costs by the court and

the defendant must have the money to meet his obligations under the court order and his must

actually pay the money over. In stark contrast, the claimant’s costs (win or lose) of bringing a

private prosecution in respect of an indictable offence are recoverable from Central Funds,

pursuant to the Prosecution of Offences Act 1985, s 17 (POA 1985, s 17). The test for recovery

of the prosecution’s costs is not whether the claimant has won or lost on the majority of the

issues in dispute but the much lower standard of whether the prosecution was properly brought

or not. In practice a private prosecutor should recover its costs, incurred in relation to a private

39 TMA 1994, s 92 CDPA 1988, s 107



prosecution, unless the court forms the view that the case was brought/proceeded without good

cause, ie was malicious.

CRIMINAL IMPLICATIONS OF TRADEMARK INFRINGEMENT

Trademark owners have long been able to enforce their rights through a federal cause of action

against unauthorized uses of their marks40. Private enforcement, however, is now only part of the

story. The federal government also acts on behalf of mark owners, both seizing infringing and

counterfeit goods at the border and prosecuting counterfeiters under federal criminal law41. The

idea of criminal penalties for certain trademark violations is not new – indeed, Congress enacted

criminal penalties as early as 1876, just a few years after it passed the very first federal

trademark statute. But mark owners had to be content with civil remedies for most of the history

of American trademark law – Congress would not again enact criminal trademark penalties for

more than 100 years after the Supreme Court struck down the 1876 Act in the Trademark

Cases.42 Thus, for all practical purposes, criminal enforcement is a modern development, and one

that has received little scholarly attention.

Intellectual Property Rights are the legal rights that are granted to a person for any creative and

artistic work, for any invention or discovery, or for any literary work or words, phrases and

symbols or designs for a stipulated period of time. The owners of Intellectual Property are

granted certain exclusive rights through which they use their property without any disturbance

and can prevent the misuse of their property. Intellectual property is any innovation, commercial

or artistic, or any unique name, symbol, logo or design used commercially. In India, Intellectual

Property is governed under the Patents Act, 1970; Trademarks Act, 1999; Copyright Act, 1957;

Designs Act, 2001, etc. The various kinds of intellectual properties are Patents, Trademarks,

Copyrights, Trade Secrets, Industrial Designs, Lay out Designs of Integrated Circuits and

Geographical Indications. The core area dealt with in this article lies at Patents, Trademarks and

Copyright. Patents protect the inventions, Trademarks prevent the infringement of the marks or

the logos under which the business is carried on or the goods are manufactured or sold and

40 The first federal trademark statute was passed in 1870. Act of July 8, 1870, ch. 230, 16 Stat. 198. That Act, like each of the others passed before the Lanham Act in 1946, provided for a private cause of action only for infringement of registered trademarks.41See Trademark Counterfeiting Act of 1984, 18 U.S.C. § 2320.42The Trade-Mark Cases, 100 U.S. 82 (1879) (finding both the 1870 and 1876 Acts unconstitutional).



Copyright grants protection to the authors of original work which can be artistic, literary,

dramatic or musical.

A trade mark is a sign which can distinguish the goods and services of the trademark holder from

those of the competitors. It can be for example words, logos or a combination of both.

Registering a Trademark is not compulsory.43 It may be registered or unregistered. Registered

Trademark: Registering a trade mark gives Trademark holder the exclusive right to use his mark

for the goods and/or services. If the trademark is registered then the symbol ® is placed next to

the trademark so as to warn others against using it. However, using this symbol for a trade mark

that is not registered is an offence. A Registered Trade Mark may put people off using the trade

mark without the permission of the holders, allows them to take legal action against anyone who

uses their trade mark without their permission, allows Police to bring criminal charges against

counterfeiters if they use their trade mark. A registered Trademark is their property, which means

they can sell it, or let other people have a license that allows them to use it.

Unregistered Trademark: For the protection of unregistered trademark, if it is not registered, still

the holder of an unregistered trademark will be able to take an action against anyone who uses it

without his permission through the common law action of passing off. To be successful in a

passing off action, one has to prove that the mark belongs to him, he must have built up a

reputation in the mark and he has been harmed in some way by the other person's use of the

mark. It can be very difficult and expensive to prove a passing off action. In case of a passing off

action, the burden of proof, which is heavier as compared to proving infringement of an

unregistered trademark, lies on the plaintiff. If a trade mark is registered, it is easier to take legal

action against infringement of the mark, rather than having to rely on passing off.44

Trade mark infringement

It is a violation of exclusive rights attaching to a trademark without the authorization of the

trademark owner or licensees (provided that such sanction was within the scope of the license).

Infringement may occur when one party, the “infringer”, uses a trademark which is identical or

43Section 2 (1)(zb) of the Trademarks Act,1999.44 http://www.ipo.gov.uk/types/tm/t-about.htm



confusingly similar to a trademark owned by other party, in relation to products or services

which are identical or similar to the products or services which the registration covers.

The test for determining whether there is infringement/ passing off trademark has been laid down

in Amritdhara Pharmacy VS. Satyadeo Gupta45 which states that

“Any unwary purchaser of average intelligence and imperfect recollection would not, as the

High Court supposed, split the name into its component parts and consider the etymological

meaning thereof or even consider the meaning of the component words as „current of nectar‟

(„Amritdhara‟) or „current of Lakshman („Lakshmandhara‟). He would go more by the overall

structure and phonetic similarity and the nature of medicine he has previously purchased or has

been told about, or about which has otherwise learnt and which he wants to purchase”.46

Applying this principle of average intelligence and imperfect recollection it is possible to find

whether there is a similarity between two trademarks and whether there is a likelihood of causing

any confusion between the two trademarks.

An owner of a Trademark may commence legal proceedings against a party which infringes its

registration. In case of Trademark, statutory protection is available to both registered as well as

unregistered trademarks. They are given both civil as well as criminal remedies for infringement

or passing off. A Suit for Infringement has to be filed before the District Court or the High Court

(depending on the pecuniary jurisdiction) within whose territorial jurisdiction the cause of action

has arisen.

The proprietors of the trademark as well as licensed users have the option to initiate criminal

prosecution against the infringers. The acts recognized as offences against which criminal

complaints can be filed are falsifying and falsely applying a trademark, making or processing

instruments for falsifying a trademark, applying false description, applying false indication of the

country of origin, tampering with an indication of origin already applied to goods, selling goods

or possessing or exposing for sale of goods falsely marked, falsely representing a Trademark as

registered, improperly describing a place of business as connected with the trademark office and

45AIR 1963 SC 44946 http://www.ipab.tn.nic.in/Orders/132-2007.htm



falsification of entries in the register47. The Criminal Remedies available are that a suit for the

above offences can be filed before the magistrate within whose territorial jurisdiction the offence

is committed or Police can register an FIR and prosecute directly; (statutory requirement to

obtain the Registrar‟s approval). Besides confiscation of goods and machinery, the Code of

Criminal Procedure, 1973, also provides for the imprisonment starting from six months which

can be extended to three years or fine of Rs. Fifty thousand which can be extended to two lakhs

or both.

CHANGING SCENARIOS

Prior to the current legislation in force, the Trade and Merchandise Marks Act of 1958 governed

the law on trademarks in India. However, it was felt that a comprehensive review of existing law

should be made in view of the developments in trading and commercial practices, increasing

globalization of trade and industry, etc. To achieve these purposes, the Trade Marks Act, 1999

was passed. Although the 1999 Act is in force at present, the 1958 Act comes to play in

litigations involving marks that were registered under it. Both, the 1958 Act and the 1999 Act,

recognize the offences of infringement and passing off and provide for remedies.

The most significant changes brought about by the 1999 Act were as follows:

a) Providing for registration of trademark for ‘Services’.

b) Providing for registration of ‘Collective Marks’, owned by Associations.

c) Providing an Appellate Board for speedy disposal of appeals.

Under the Trademarks Act 1999, the Indian courts may grant the following reliefs for

infringement and passing off:

Permanent and temporary injunctions; compensatory and punitive damages; rendition of

accounts; or delivery of the infringing goods, labels, marks for destruction/erasure.

47 Section 102 of the Trademarks Act,1999



While injunction is a remedy arising out of the Civil Procedure Code 1908, in India, awarding

damages as a remedy emerged as a result of tortuous liability. Although, granting injunctions

was the usual remedy, Indian courts, especially the High Courts have recently started awarding

both compensatory and punitive damages for trademark infringement.

The trend of awarding punitive damages in the realm of trademarks started with Time

Incorporated v Lokesh Srivastava48, where the Court awarded both compensatory damages

and punitive damages for infringement of the trademark ‘TIME’. The Court awarded the plaintiff

Rs 5 lakhs, for loss of reputation, plus Rs 5 lakhs in punitive damages, including interest; the

total damages awarded being Rs 16 lakhs.49 The Court drew a distinction between compensatory

and punitive damages and observed that punitive damages need to be awarded in this case

because not only did the plaintiff suffer due to infringement, but readers of the defendant’s

magazine also suffered. They were deceived because they purchased a magazine believing it to

be published by the plaintiff. The Court observed that the time was ripe to award punitive

damages with a view to discourage lawbreakers. The Court also observed that punitive damages

should be penal in nature with the quantum being dependant on the flagrancy of infringement.50

In Microsoft Corporation v Mr Kiran and Anr,51 the Court observed:

‘The legal position in India with respect to granting damages in cases of infringement of

trademarks and copyrights, has been progressive. The courts have now started granting the

relief of damages with the view that a defendant cannot escape damages as a consequence of its

disappearing from the legal proceedings. The claimant has a right to damages regardless of the

defendant's state of mind, and that is so regardless of whether the cause of action is infringement

of a registered mark, or passing off.’

In Microsoft Corporation v Mr Rajendra Pawar52, the Delhi High Court referred to the case

of Mathias v Accor Economy Lodging Inc53. The Court, while elucidating the factors

48 2005 (30) PTC 3 (Del).49 http://www.worldtrademarkreview.com/issues/Article.ashx?g =40077c18-6ebb-4453-b9d6-eaf2cb095c3e (14 June 2010)50 http://www.managingip.com / Article.aspx? ArticleID=1321449 (15 June 2010).51 Manupatra Intellectual Property Report, 2007 (3) 214, 2007 (35) PTC 748 Del.52 CS (OS) No 530 of 2003.53 347 F.3d 672 (7th Cir 2003).


http://www.worldtrademarkreview.com/issues/Article.ashx?g


underlying the grant of punitive damages, observed that one of the functions of punitive damages

is to relieve the pressure on an overloaded criminal justice system by providing a civil alternative

to criminal prosecution of minor crimes. It was further observed that

“the award of punitive damages serves the additional purpose of limiting the defendant's ability

to profit from his fraud by escaping detection and prosecution”.

In Microsoft Corporation v Deepak Raval54, the Delhi High Court held that the justification for

award of compensatory damages was to make up for the loss suffered by the plaintiff and the

rationale behind granting punitive damages is to deter a wrong doer and the like-minded from

indulging in such unlawful activities.

This is more so when an action has criminal propensity. Thus, while awarding punitive damages,

courts have taken into consideration the conduct of the defendants who have ‘willfully calculated

to exploit the advantage of an established mark’ (as used in US courts), or ‘flagrancy of the

defendant's conduct’ (test adopted by Australian courts). The English courts have used the test of

‘dishonest trader’, i.e., one who deals in products knowing that they are counterfeit or is

‘recklessly indifferent’ as to whether or not they are counterfeit.

In Hero Honda Motors Limited v Shree Assuramji Scooters55, the Court observed:

‘This Court has no hesitation in saying that the time has come when the courts dealing with

actions for infringement of trademarks, copyrights, patents, etc. should not only grant

compensatory damages but award punitive damages also with a view to discourage and

dishearten law breakers who indulge in violations with impunity out of lust for money so that

they realize that in case they are caught, they would be liable not only to reimburse the

aggrieved party but would be liable to pay punitive damages also, which may spell financial

disaster for them.’

Looking at the present trend of the Indian Judiciary in cases pertaining to trademark

infringement, it appears that the Judiciary has become more receptive to the idea of granting

punitive damages along with compensatory damages. In ambiguous questions of law, the Indian

54 CS(OS) No 529/2003.55 125 (2005) DLT 504, 2006 (32) PTC 117 Del



Judiciary has relied upon the decisions and doctrines of the English, American and Australian

courts. It is pertinent to note that were no reported judgments related to granting damages for

trademark infringement until the year 2005, in the Time Incorporated v Lokesh Srivastava56

case. This could be attributed to the fact that the commercial significance of intellectual property

assets was not realized until recent times. After the Time Incorporated case, courts have granted

punitive damages when well-known brands, having market reputation and goodwill, have

suffered huge monetary losses due to trademark infringement and/or passing off. This welcome

change in the judicial trend may be attributed to the fact that globalization and opening up of the

Indian economy which occurred in early 1990s, led to a greater recognition of the concept of

protecting brands, labels and identity.

As IP valuation will undertake a structured scheme in the days to come, it is expected that the

principle relating to damages will also evolve and become more concrete to meet the needs of the

time. Nevertheless, it is encouraging to witness courts acknowledge the commercial value that

intellectual assets have attained.

CONCLUSION

There is a distinct set of issues that arises in Management, Maintenance and Protection of IPR.

Here, it is a challenge to design and operate institutional innovation processes that would

preserve intellectual excellence and at the same time amicably fit into a disciplined formal IPR

management system. Indian industries and R&D institutes have not really excelled in the area of

innovation due to various factors. But new IP-Regime sounds really encouraging. Hence, there is

a need for institutional innovation to be encouraged and motivated continuously. From the

intuitional point of view, the major challenge is to develop and train techno legal manpower to

manage critical issues in management of IPR.

There is a need for awareness creation and awareness promotion, which can support

entrepreneurs, inventors, and creators in not only creating the innovation but also protecting what

they create and in making appropriate wealth out of what they create.

56 2005 (30) PTC 3 (Del).



Government must think of setting-up required number of advisory body/council in order to

render services regarding IPR information, protection, and further development. Developing

countries, particularly India, require more sophisticated technologies to be competitive in today’s

global economy. For which we need to give serious consideration to our policies for encouraging

technology transfer. In addition to this, effective competitive policies must be established.

With growing pharmaceutical, software and entertainment industries, India has much to gain

from implementing a more robust IPR regime. Increased intellectual property protection would

boost bilateral trade and investment with the United States. Hi-tech trade and collaborative

research and development are growing, but there is a need to do it faster.

With each passing day the arena of Intellectual Property is gaining greater importance. People

have even started celebrating World Intellectual Property Day on 26th April. The Code of

Criminal Procedure, the Indian Penal Code as well as the Patent Act, 1970, grant exclusive rights

to the holder of the intellectual property as well as provide for the punishment for the violation of

Intellectual Property. Besides the amendments made in these acts, Special Intellectual Property

cells are set up in major cities and suo moto raids are also being carried out, The Code of Civil

Procedure is amended to ensure expedited trial. Also industry specific bodies like

NASSCOM( National Association of Software And Service Company) –BSA (Business Service

Alliance) for Software Piracy, IPRS (Indian Performing Rights Society) /PPL (Phonographic

Performance Limited) for Sound Recording/ Performance Piracy have been set up to fight

various forms of piracy as mentioned above. In Tamil Nadu, the Tamil Nadu Prevention of

Dangerous Activities of Bootleggers, Drug-offenders, Forest-offenders, Goondas, Immoral

Traffic Offenders and Slum-grabbers Act, 1982, commonly referred to as the Goondas Act has

been brought into force to curb the crimes committed by Bootleggers, Drug-offenders, Forest-

offenders, Goondas, Immoral Traffic Offenders (which now includes Video Piracy as well) and

Slum-grabbers . Goondas Act, as listed in the Indian Penal Code's chapters, includes „offences

against the human body‟, „offences against property‟ and „criminal intimidation, insult and

annoyance.‟

Under the provisions of the Goondas Act, a person held liable for any of the above mentioned

offences will not be able to come out on bail for a year. The Film Federation of India (FFI), an



apex body of the film industry in India, has urged Chief Ministers of all the States to tackle video

piracy under the Goondas Act.57 The same is implemented in Tamil Nadu and Karnataka. It is

observed that the existing criminal laws are inadequate to thwart the menace of video piracy.

Hence Goondas Act is implemented to curb video piracy. Intellectual Property (IP) reflects the

idea that its subject matter is the product of the mind or the intellect. Excess efforts are put in for

the same. Thus it is the Intellectual Property holder‟s sole right to protect his property against

those who attempt to misuse the property.

BIBLIOGRAPHY

Case Laws:

S.No. Case Name Citation

1. Yahoo Inc. v. Akash Arora

1999 PTC 201

2. Tata Sons Ltd. v. Manu Kosuri & Ors 2001 DLT 659

3. N.R. Dongre v. Whirlpool (1996) 5SCC 714

4. Hardie Trading Ltd v. Addisons Paint & Chemicals Ltd (2003) 27 PTC 241 SC

5. Wander Ltd v. Antox India P Ltd. 1990 Supp (1) SCC 727

6. Patel v. Shah (2002) 3 SCC 65

7. Midas Hygiene Industries P Ltd v Bhatia

2004 (3) SCC 90

8. Oxford v. Moss (1978) 68 Cr App Rep 183,

57 http://www.hinduonnet.com/2005/02/15/stories/2005021507870500.htm



[1979] Crim LR 119.

9. South Bucks District Council v. Porter [2004] 4 All ER 775

10. American Cynamide Co. v. Ethicon Ltd. [1975] 1 All ER 504

11. Service 5 Software Ltd. V. Clarke & Ors. [1996] 1 All ER 853

12. Coin Control Ltd. V. Suzo International Ltd. (U.K)

& Ors

[1997] 3 All ER 45

13. Roche v. Primus (Case C-539/03) [2006] All

ER (D) 186 (Jul)

14. GAT v. Luk (Case C-4/30)

15. Dyson Appliances v. Hoover Ltd. [2001] All ER (D) 37 (Jan)

CDPA 1988, s 237

16. Monsanto Technology LLC v. Cargill International

SA and Anr.

[2007] All ER (D) 118 (Oct)

17. Attorney General v Blake (Jonathan Cape Ltd, third

party)

[2000] All ER (D) 1074

18. Vercoe and others v Rutland Fund Management Ltd

and others.

[2010] All ER (D) 79 (Jun)

19. General Tire and Rubber Co v Firestone Tyre and

Rubber Co Ltd

[1975] 2 All ER 173

20. Gerber Garment Technology Inc v Lectra Systems Ltd (1994) IP & T Digest 15



and another

21. Celanese International Corp and another v BP

Chemicals and another

[1998] All ER (D) 493

22. Allied Maples Group Ltd v Simmons & Simmons (a

firm)

[1995] 4 All ER 907

23. Sullivan v Bristol Film Studios Ltd. [2012] All ER (D) 69 (May)

24. Amritdhara Pharmacy v. Satyadeo Gupta AIR 1963 SC 449

25. Time Incorporated v Lokesh Srivastava 2005 (30) PTC 3 (Del).

26. Microsoft Corporation v Mr Kiran and Anr, 2007 (35) PTC 748 Del

27. Microsoft Corporation v Mr Rajendra Pawar CS (OS) No 530 of 2003.

28. Mathias v Accor Economy Lodging Inc 347 F.3d 672 (7th Cir 2003).

29. Microsoft Corporation v. Deepak Raval CS(OS) No 529/2003.

30. Hero Honda Motors Limited v Shree Assuramji

Scooters

2006 (32) PTC 117 Del

Articles:



Jayashree Watal, “Intellectaul Property in Indian Agriculture”

Kamil Idris, Intellectual Property : A Power Tool for Economic Growth , “The

Process of Economic Growth”

Books:

Pillai Atchuthen P S, Law of Tort, 8th edn (Eastern Book Company, Lucknow), 1987

Dr. B.L. Wadhera, Law Relating to Intellectual Property, 4 thedn, Universal Law

Publishing Co.,2007.

Reports:

Council Regulation (EC) 1383/2003 Goods Infringing Intellectual Property Rights

(Customs) Regulations 2004, SI 2004/1473

Manupatra Intellectual Property Report, 2007 (3) 214, 2007 (35) PTC 748 Del.

Websites:

www.icrier.org/pdf/jayashree

www.wipo.int/about-wipo/en/dgo/wipo_pub_888/pdf/wipo_pub_888_chapter

www.questia.com/PM.qst?a=o&se=gglsc&d=5001976550

http : //legaldictionary.thefreedictionary.com / damages (15 June 2010).


http://www.questia.com/PM.qst?a=o&se=gglsc&d=5001976550

http://www.icrier.org/pdf/jayashree


http://www.ipab.tn.nic.in/Orders/132-2007.htm

http://www.worldtrademarkreview.com/issues/Article.ashx?g =40077c18-6ebb-4453-

b9d6-eaf2cb095c3e (14 June 2010)

http://www.managingip.com / Article.aspx? ArticleID=1321449 (15 June 2010).

http://www.hinduonnet.com/2005/02/15/stories/2005021507870500.htm


http://www.ipab.tn.nic.in/Orders/132-2007.htm

civil and criminal remedies analysis

Documents