INTELLECTUAL PROPERTY RIGHTS- DISPUTES AND MEDIATION

Prasad Subbanna- Coordinator, BMC

WHAT IS IPR?

IPR is a legally protected exclusive right coveted highly by Corporate world. Technology has become the most important wealth creating tool. IPR is the legal fencing tool, with which holders of technology maximize their profits. If you have 15 acres, you can fence it off. But, if your market is regional, National or global, then you need IPR to fence it.
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INTERNATIONAL HISTORY OF IPR REGIME

PATENTS, TRADEMARKS, COPYRIGHT, DESIGNS. (Protected by Statutes) and Trade secrets, protected by Common Law and Contract (Classical IPR). Greek States were the first to grant Patents for inventions during the 15th century. But, until the Industrial Revolution, IPR did not acquire any commercial or legal significance.

INTELLECTUAL PROPERTY SYSTEM [INDUSTRIAL PROPERTY SYSTEM] ALL THESE RIGHTS CONFER SOME KIND OF MONOPOLY.HENCE THEY MUST NOT ONLY BE STRICTLY JUSTIFIED BUT ALSO STRICTLY CONSTRUED

COMMON LAW RIGHTS REGISTRATION NOT COMPULSORY COPYRIGHTS-enjoy inherent protection TRADEMARKS

STATUTORY RIGHTS REGISTRATION IS MANDATORY PATENTS DESIGNS

NEW GENERATION IPR

1. Geographical indicator Protection available for goods that have a specific geographical origin and possesses qualities or reputation due to that place of origin. This is an IPR held by a group of people and it cannot be freely transferred for money. There must be a specific link between the products and original place of protection. Geographical indicator can be perpetual.
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NEW GENERATION IPR (CONTD)

2. Plant Varieties Registration:- A new variety of

an existing species, if it discloses a new characteristic, which is beneficial, the same can be protected under the Act. For it to qualify for protection it must have (a) novelty, (b) distinctiveness, (c) uniformity and (d) stability. Indian Law also protects the rights of the farmer to use the seeds of the new variety without any restriction from the registered owner. The period of protection depends on the type of the plant.
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NEW GENERATION IPR

3. Semi conductor chips:- These are the back bone of all electronic products. Registration of the chip is compulsory for availing legal protection. The criteria for protection is, (a) original (b) inherently distinctive (c) Not commercially exploited either in India or abroad. The period of protection is 10 years from the date of registration or commercial exploitation whichever is earlier.
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DISTINCTION INTER SE
COPYRIGHT PATENT

This protects Literary & Artistic works, Movies, Dramas, Songs (both lyrics & the musical composition), Books, Films, Computer Software etc. DURATION: Depends on the type E.g.Films:50 years Books: lifetime of the author & 60 years thereafter. Registration is optional

All inventions that have commercial applications, except those that are excluded from patentability.
DURATION: 20 years from the date of Application. Registration is compulsory
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DISTINCTION INTER SE
TRADEMARKS
This is for marks that are applied to goods in trade. It is intended to convey to the purchaser the origin of goods & an assurance that the goods bearing the mark are of the same quality. DURATION: Infinity
Registration optional

DESIGNS
To concepts that enhance the aesthetic value of the goods as opposed to functional features. DURATION: Maximum of 15 years . Registration compulsory
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TRADEMARKS AND PASSING OFF

PUBLIC INTEREST CONCERNS Helps the consumer to choose the products A commercial certificate on the origin of the goods. Prevents unjust enrichment & misappropriation of commercial goodwill Serves as a representation to the consumer that the goods bearing the same mark conform to a particular standard of quality. PRIVATE INTEREST CONCERNS Reputation is social extension of a person. Hence no one else should be allowed to take commercial advantage of it. Originated from the TORT of PASSING OFF.

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EVEN UNREGISTERED TRADEMARKS CAN HAVE PROTECTION UNDER LAW OF PASSING OFF- DISTINCTION

PASSING OFF
TRADEMARK
1. Mere possibility of confusion is enough to grant relief. 2. Registration is prima facie proof of ownership of the mark. 1. Actual deception should be proved. 2. The plaintiff has to prove that by continuance of use has acquired the ownership of the mark in question.

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EVEN UNREGISTERED TRADEMARKS CAN HAVE PROTECTION UNDER LAW OF PASSING OFF- DISTINCTION (CONTD)

TRADEMARK
3. Trademark infringement is actionable per se. 4. Registered TM owner can sue at his place of business.

PASSING OFF
3. In passing off action damage to plaintiff has to be pleaded and proved. 4. It can be initiated only where the cause of action arose or defendants place of business.
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WHY PATENT?
RATIONALE BEHIND PATENT PROTECTION

Disclosure theory: This enables the inventor to disclose his invention to public ,instead of keeping it a trade secret. After the expiry of the monopoly period, any interested person can use the Specification for replicating the invention

Incentive theory: Patents add fuel to the fire of genius-Abe Lincoln Creation of technology is highly capital & risk intensive. Patent monopoly is a just reward. Every invention improves quality of life. Patent provides a chance to make a commercial success of an invention.
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CRITERIA FOR PROTECTION

COPYRIGHT

PATENT

Intellect encages with creation and application of knowledgeCreation of knowledgeThis is primarily protected by Copyright System. Requirements are (a)originality (b)reduction into a tangible form

Application of created knowledge to produce useful results-This is primarily protected by PATENT SYSTEM Requirements are Novelty , Utility, Nonobviousness & Statutory subject matter Utility means that the invention is capable of industrial application

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LEGAL REGIME

International History of IPR 1604:- Statute of Monopolies, (U.K)-more an attempt to restrict the powers of the Crown to grant monopolies, than a genuine desire to protect Literary, Artistic, Sculptural or Technological Works. International History of IPR 1861- Berne Convention on the Protection of Copyrights 1882-Paris Convention on the Protection of Industrial Property. BIRPI- A Private organization for the Protection of IP. 1957-Birth of WIPO, which became Repository organization for these Treaties 1994-WIPO became a specialized Agency of U.N
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INDIAN LEGAL REGIME OF IPR

Indian Patents and Designs Act 1911(now repealed)

Copyright Act 1956

Trade & Merchandise marks Act,1957(now repealed and replaced by Trademarks Act, 1999) Patents Act,1970 Designs Act 2000
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DISPUTES IN IPR
Patent is a license to a law suit. If you have an IPR and not willing to sue, IPR is useless. IPR litigations are fought essentially to co-opt desirable competitors and snuff out undesirable ones.

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INDIAN SCENARIO
The number of IP litigations are few in India but their number is increasing. Amongst the IPR, trade mark and copyright are the most litigated. Patents and Designs are the least litigated. Plant Varieties and Semi conductor chips are still in their embryonic stages.

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FORUMS FOR CONFLICT RESOLUTION

The IPR disputes can be classified into three kinds: (1) Disputes relating to acquisitions (Jurisdiction primarily with IPR offices and IPAB)
(2) Disputes relating to licensing and prevention of IPR abuse (IPR offices and IPAB) (3) Disputes relating to enforcement (Civil, Criminal Courts and Customs and Revenue Authorities)

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TYPES OF IPR DISPUTES

Disputes may be between related parties or unrelated parties. If IPR is transferred pursuant to licensing or transfer of technology agreement, between a holding and subsidiary company, there will always be a clauses on Arbitration in foreign forum and applicable laws. If it is a dispute between unrelated parties, there may not be an arbitration agreement and hence will reach courts for resolution.
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PATENT DISPUTES

All IPR are rights in rem. A grant of an IPR is no conclusive proof of its validity and the enforceability of an IPR can be challenged on many grounds at a future date. Under law only Courts or IPAB, can pronounce on the validity of patents. Its not clear whether an Arbitrator can pronounce on the validity of a patent. The Transferee may be contractually prohibited from challenging the validity of patent. There has been less than 25 patent litigations in India.
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COPYRIGHT AND TRADEMARK DISPUTES

Copyrights and Trademarks provide for civil and criminal remedies for enforcement. In many cases, infringement may be innocent or bonafide. They are fit candidates for mediation. IPR piracy has become a method of mafia financing. In such cases criminal law must be set in motion and Mediators should keep off.
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DISPUTES RELATING TO CONFIDENTIALITY AND TRADE SECRETS

These types of disputes occur between employer - employee, principal - agent, IPR holders and other sub contractors etc. In reality after a litigation, there will be nothing secretive about trade secrets and the information will be enlarged in public domain. Considering the confidence level between the disputing parties, these disputes are again good candidates for mediation.
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MEDIATION AND IPR DISPUTES

Considering the costs involved in fighting an IPR litigation, settlements half way through are the norm in the industry. Most often, since the purpose of IPR litigations is co-opting the competitor or making an infringer pay royalties, mediations can help to evolve fair licensing practices in the use of IPR.
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WHAT IS MEDIATION?

Mediation is one of the ADR methods. It is an effective dispute resolution mechanism. It is not an adjudicatory process but a negotiation process. Non-adversarial wherein right of appearance, participation is primarily of parties. Prominence is given to parties in resolving disputes and identifying solutions.
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Mediation is a voluntary, non-binding, confidential experience to arrive at a settlement.

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WHAT DOES A MEDIATOR DO?

Listens. Suggests. Steers. Facilitates. Explores options for mutual gain. Ensures that by taking control of the negotiating experience the parties can control the outcome

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The potential of mediation for preventing and resolving IP disputes is yet to be fully realized as most of the IP disputes are still referred to traditional means of Court litigation. Over a period of time the economic importance of IP has grown to the extent that for many companies, IP rights are their basic assets and disputes involving their rights could interfere with their activities

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The trend towards ADR and mediation was re-enforced by the success of domain name dispute and resolution procedures which provides trademark owners with an efficient remedy against the bad faith registration and use of domain names corresponding to their trademark rights. A growing number of procedural laws encourage or even require the use of ADR.
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ADVANTAGES ADR/MEDIATION.
Single Procedure Party Autonomy Neutrality Expertise Confidentiality Finality

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SINGLE PROCEDURE

Court litigation in International IP disputes can involve a multitude of procedures in different jurisdictions with a risk of inconsistent results. Through ADR, the parties can agree to resolve in a single procedure a dispute involving a right that is protected in a number of different countries, thereby avoiding the expense and complexity of multi jurisdictional litigations.
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PARTY AUTONOMY

Because of the private nature, ADR offers parties greater control over the way their dispute is resolved. Unlike in Court litigation the parties may choose the procedural rules the places and time etc..,.

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NEUTRALITY

ADR can be neutral to the law, language and institutional culture of the parties. This way, it would eliminate any home Court advantage that one of the parties might otherwise enjoy in the context of Court litigation.

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EXPERTISE

The parties can select mediators who have special expertise in the legal, technical or business area, relevant for resolution of their dispute.

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CONFIDENTIALITY

Mediation proceedings being private the results are kept confidential. This is particularly important where as is often in IP disputes confidential information or trade secrets are at stakes.

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FINALITY

Unlike Court decisions which are subject to appeals ADR methods and mediations are not normally subject to appeal.

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Mediation also provides one last chance before major expenses are incurred. If negotiation can work, then mediation can make the negotiation process work better.

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The future is clear. Mediation is coming to IPR

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THANK YOU ALL!

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