INTELLECTUAL PROPERTY COUNTERFEITING

 

Intellectual Property COUNTERFEITING

 

The central Government shall, by notification in the official Gazette, establish an Appellate Board to be known as the Intellectual Property Appellate Board. The Board shall exercise the Jurisdiction, powers and authority conferred under the Act. The Board shall have the powers to regulate its own procedure including the fixing of places and times of its hearing subject to the provisions of this Act and the rules made there under.

The Appellate Board shall not be bound by the procedure laid down in the code of civil procedure but shall be guided by the principles of natural Justice. Trade Mark Act 1999 provides the provision for the establishment of Appellate Board

The Appellate Board shall have the same powers as are vested with a civil court under the code of civil procedure, while trying a suit in respect of following matters: receiving evidence; issuing commissions for examination of witnesses; requisitioning any public record; and other matter which may be prescribed.

The District Court functions under the superintendence and control of the High Court of the State. Besides, the District Court, there are Courts of Sub-Judges, Munsiff Courts and Courts of small causes.

The Judiciary system in India consists of the Supreme Court, High Court and the District Court. The Supreme Court of India is at the apex of the Judiciary system and consists of chief Justice of India and other Judges appointed by the president of India. It is the highest and the final court of appeal in the Country. The High Court is the highest court at the State level. It consists of the Chief Justice and other Judges. It supervises the working of all subordinate courts and drafts rules and regulations for the transaction of business.

Civil Litigation

The objectives of civil litigation are:

·         provide compensation for the prejudice caused by infringements;

·         dispose appropriately of the infringing copies (destruction or other disposal outside the normal channels of commerce)

·         dispose appropriately of implements used for infringing activities; and

·         grant injunctions to prohibit further infringements.

The remedies typically available in intellectual property infringement actions are injunctions, damages and account of profits.  Most actions start with an application for some form of preliminary or interlocutory relief, and in most cases does not get beyond this preliminary stage.

The Interlocutory Injunction

The period from the time of commencement of proceedings to the final determination of a case can allow significant damage to be done to sales and profits and to reputation, due to other exploitation of material and/or information.  Furthermore, the nature of the infringement or other unlawful conduct may be such as to lead to damages or an account of profits as ultimately an inadequate remedy.  The defendant may be impecunious or may disappear.  This may be because of the nature of the intellectual property right in question and the difficulty of reaching a precise estimate of the loss suffered as the result of an infringement.

 The primary matter with which the court is concerned in granting an interlocutory injunction is the maintenance of a position that will most easily enable justice to be done when the final determination is made. The most useful and widely used preliminary remedy is the interlocutory or interim injunction, the main purpose of which is usually described as being to preserve the status quo until the hearing of the main action.  Thus, a court will sometimes order that an earlier position be restored, in accordance with the requirements of justice.

This is often because the evidence needed to sustain an application for both interim and final relief is not readily available and will not become available through the usual processes of discovery.  In such a case the plaintiff will be unlikely to obtain an interim injunction because he will not have the necessary evidence. In an increasing number of cases interlocutory injunctions are not sufficient to protect intellectual property rights against the threat of continuing infringement.   Sometimes the defendant will remove or destroy the infringing material. The relief granted is an ex parte order for entry and inspection of premises and removal of evidence. These orders are known as Anton Piller orders, and may be a necessary step before an interlocutory injunction can be obtained.

The Anton Piller order derives its name from a court of Appeal decision in the case Anton Piller AG vs. Manufacturing Processes (1976) Ch. 55. An Anton Piller order has the following elements:

·         An injunction restraining the defendant from dealing in the infringing goods or destroying them;

·         An order that the plaintiff’s Advocate be permitted to enter the premises of the defendants, search the same and take goods in their safe custody; and

·         An order that the defendant be directed to disclose the names and addresses of suppliers and customers and also to fill an affidavit within a specified time giving this information.

In India, Anton Piller order has been used for the protection of intellectual property. Moreover, an Anton Piller order has been fine tuned for effective application of this order. Now, it includes additional safeguards; i.e., lock breaking power and the freedom to take police assistance in case of anticipated violence.

There is another order known as Norwich Pharmacal orders where the court directs not only the defendant but also third parties to disclose the information.

 

In order to address this problem the courts of common law countries have formulated and developed the Mareva injunction which operates to prevent defendants from removing assets from the jurisdiction or from disposing or dealing with them within the jurisdiction in such a way as to frustrate any judgment that may be entered against them.

Injunction

In the normal course, a successful plaintiff in an industrial property action will be entitled to a final injunction. The grant of injunctions is discretionary and only used in unusual situations. 

Damages or Account of Profits

This approach has also been used in breach of confidence and copyright infringement cases.  Another approach which is more difficult to prove is through consideration of sales lost to the plaintiff; in this case the plaintiff is entitled to the entire lost profit.

Damages for past infringement are then based upon a payment of a royalty in respect of, for example, each infringing article. But problems do arise here - particularly when in reality the plaintiff would never have granted a license. 

Criminal Procedures

India has effectively resorted to the criminal procedures for the protection of IPR. TRIPS Agreement provides:

·         imprisonment and/or  monetary fines,

·         penalties,

·         Seizure, forfeiture and destruction of infringing goods and of any materials and implements the predominant use of which has been in the commission of the offence.

Enforcement of IPR in India

India has a strong Judiciary system. In order to protect IPR in India, the industry and the enforcement agencies need to step up their efforts and become more innovative to combat counterfeiting. It is now critical for the Indian industry to understand the implications of counterfeiting-both legal and economic, to protect its own business interests in India and abroad. There is a need to develop advanced authentication technologies for counterfeit detection. On the enforcement side, various departments such as the customs and police department need to be aware of the latest techniques being employed in other countries to detect and counter counterfeiting. The enforcement of IPR is the ability of the right holder to protect his assets. An efficient system that provides effective protection through enforcement is necessary to make the IP rights meaningful.

Create a national Anti-Piracy Task Force to take criminal and civil actions against piracy.  If this is not achievable, provide resources to the states to equip and train state IP Task forces. The Home Ministry should take the lead in providing this training and resources, and the Home Minister should issue a strong and widely publicized condemnation of piracy and the damage it is doing to India and urge all police forces to take immediate action to root it out;

Set up specialized fast track IP courts to get around the massive backlog of civil and criminal cases pending in the Indian court system. Failing that, chiefs of all the high courts should appoint special judges to try copyright piracy crimes and civil cases, imposing deadlines for resolving them finally.;

Suo moto raids against piracy at all levels. This will require a significant increase in the resources and manpower in the IPR cells and the local police forces;

Reform the judicial system to prevent unjustified continuances; adopt case management techniques; eliminate court backlogs and focus on new cases and their speedy conclusion;

Impose deterrent penalties on pirates and establish clear standards for damages in civil cases, including implementing a statutory damage system which results in real deterrence;

Empower customs to seize, and in particular, destroy, pirated goods; adopt a modern optical disc law;

Bring the law fully into compliance with the WIPO treaties to prepare for the new era of e-commerce.

Conclusion

The Courts play an important role in hearing appeals from decisions of the industrial property office and in adjudicating infringement actions. The appeal procedures involves: pre hearing conference, evidence – real evidence, expert evidence, market survey evidence, presentation of evidence and final disposition. Appellate Boards are granted same powers as are vested in a civil court under the code of civil procedure, while trying a suit in respect of following matters:

receiving evidence; issuing commissions for examination of witnesses; requisitioning any public record; and any other matter which may be prescribed.

The basic objectives of civil litigation are;

to provide compensation for the prejudice caused by infringements; to dispose appropriately of the infringing copies to dispose appropriately of implements used for infringing activities; and to grant injunctions to prohibit further infringements.

The intellectual property infringement actions are injunctions, damages and account of profits.  Most actions start with an application for some form of preliminary or interlocutory relief, and in most cases does not get beyond this preliminary stage.

In the normal course, a successful plaintiff in an industrial property action will be entitled to a final injunction.