IP_Module 4

MODULE 4: ENFORCEMENT OF INTELLECTUAL PROPERTY

4.1 ‘ENFORCEMENT IS A PART OF IP MANAGEMENT’

Anyone who has had the experience of dealing with the court systems would think twice
before approaching a court for any litigation. Any lawyer, who guarantees that he would win
a case for the enterprise, should stop practicing law. Litigation in almost all jurisdictions of
the world, requires time, patience and to top it all, money. But if litigation is handled more
cautiously and is a part of the enterprise’s business objective, then it is highly
recommended.

The average number of litigation cases filed in India as a percentage of the number of rights
registered in respect of patents, trademarks and designs for the period 1996 - 2004 was
approximately 0.04 per cent. A similar figure for the United States in 1988 was
approximately 1 per cent1. One of the reasons for this low percentage could be that
infringement of IP rights is not prevalent across businesses, but there are insufficient
statistics to determine whether this is so.

The importance of enforcement of IP as part of IP management and supporting of IP
commercialisation cannot be doubted. Not only must an enterprise be confident that it can
enforce its IP rights but it may wish to be proactive and drive its business objectives by
seeking out infringers. As with many other aspects of managing a business, the trick is to
find the balance.

4.2 COMMON ISSUES CONCERCING ENFORCEMENT

Each of the pieces of legislation in India relating to IP rights address in some degree, the
aspects of enforcement of those respective IP rights. Here are some common themes.

4.2.1 UNAUTHORISED EXERCISE OF MONOPOLY RIGHTS

Enforcement of Intellectual Property is all about maintaining the enterprise’s monopoly
position or competitive advantage over its competitors. In this respect it is exercising the
fundamental economic right to ensure that no other person/enterprise takes advantage of
the effort that it took to acquire those rights. On every occasion where there are alleged
infringing acts it is a case of studying the alleged infringing act and comparing it against the
monopoly rights that are held by the enterprise. Only after comparing the infringing act
should the enterprise take the next step on how to deal with the infringer. Generally the
best and easiest option is filing a complaint in the court. There are other ways to handle
such infringing acts apart from filing a court case. This would be discussed in the coming
pages.

1 Kevin G Rivette and David Kline, Rembrandts in the Attic, Unlocking the Hidden Value of Patents,
Harvard Business Review, p 47.

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4.2.2 DEFENSIVE ACTION

Each and every piece of IP legislation sets out various defences to infringement actions. This
is the second step in analysing the prospects for the enterprise enforcing its rights. For these
reasons use of disclaimers and notices becomes very important.

4.2.3 OPPOSING THE GRANT OF REGISTRATION

In relation to the forms of IP that involve a formal registration process there is an
opportunity for a competitor to oppose the grant of registration to the enterprise. This
enables a competitor to delay the grant of IP rights to the enterprise. Of course, there are
rules which preclude parties from running frivolous actions. However, IP has become so
intricate and complex that it would be rare for a court to conclude that an argument posed
by a competitor was frivolous or lacked substance. A competitor, like the enterprise itself, is
entitled to its day in court.

Now, if we see this in relation to patents, the information which is presented in opposition
proceedings is not guaranteed to be kept confidential.

In these circumstances the enterprise is left with a dilemma, and here two important
questions arise:

1) Should it bypass the hearing and take the case straight to court because the court will
have the power to suppress the release of confidential information?
2) Alternatively, does the enterprise proceed with the opposition without submitting the
relevant information? and thereby suffer the risk that it may lose the opposition proceeding
because critical information was not presented.

4.2.4 CHALLENGING THE REGISTRATION

It is open to the defendant in IP enforcement proceedings to challenge the validity of the IP
rights asserted by the enterprise. In relation to registered forms of IP this can involve
lodging a counter-claim that the registration should be revoked on the basis that the
relevant criterion for registration has not in fact been met. This has been of particular
concern in relation to patents until recent amendments. The threat of IP rights being lost in
the heat of battle adds to the complexity of enforcement of IP rights. An enterprise may find
more value in being able to assert the right rather than following through with an actual
action or proceeding. This is because, in many cases, letters of demand are sufficient to
achieve an acceptable outcome. Often this depends on the muscle that the enterprise is
able to flex.

4.2.7 PRECEDENT VALUE

In order to proceed with the enforcement action, the enterprise must consider in
determining whether the marketplace in which the enterprise conducts business take note
of such an action? Or whether to proceed with an enforcement action is the precedent

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value that the litigation will bestow? Of course this is a double-edged sword for the
enterprise. A success in the action may be enough to drive infringers and competitors away
from the market. The failure may see the collapse of its business together. For this reason, it
is imperative that the enterprise thoroughly assesses its IP enforcement strategy in the
context of its whole business. Where stakes are this high the IP advisers for the enterprise
will usually recommend the advice of senior barristers. Senior counsels experienced in IP
litigation are usually worth their weight in gold (and often there is a fair amount of weight).
They bring to bear on the decision process a wealth of experience in arguing the same or
similar cases before the courts and in particular the relevant judges on a regular basis. They
will not only be able to add value to determining prospects of success but also, as is the case
with most litigation, be able to greatly assist in determining the appropriate time to settle
and the terms of such settlement.

4.2.8 INSURANCE: DEFENSIVE AND OFFENSIVE

It will be evident from the above discussion that cost plays an important part in the strategy
for IP enforcement. To some degree this risk can be transferred in part by taking out
offensive and defensive IP insurance. This insurance itself has a cost and its usefulness
needs to be weighed against the perceived risk of IP enforcement having to occur.

4.2.9 ALTERNATIVE DISPUTE RESOLUTION

Enforcement of IP rights inherently raises the spectre of litigation. For those entrepreneurs
unfortunate enough to have encountered litigation the risks, in terms of results, time and
cost, are embedded in their memory. The drawbacks associated with litigation have
fostered alternative mechanisms to resolve disputes such as mediation and arbitration and
it is now common to find a standard clause in contracts requiring the parties to at least
attempt some form of ADR before resorting to litigation.

Mediation, which typically entails a mutually respected independent person facilitating a
settlement, will only succeed if all participants in the dispute are truly open-minded about
resolving the dispute. It is surprising to hear about the number of disputes which were
referred to a mediator that were not resolved by mediation because resolution short of a
judicial or1arbitral decision would not meet one party’s, objectives. Arbitration is-often
criticised as ‘being as risky as normal litigation because of the uncertainty of the result and
the costs involved. Despite this, arbitration can be a useful mechanism where the source of
dispute is a technical rather than legal matter, and where the’ dispute relates to an
international contract. In the latter circumstance it is common for the parties to invoke the
arbitration or conciliation rules declared by the United Nations Commission on International
Trade Law (UNCITRAL) or the rules of the International Chamber of Commerce (ICC).

4.2.10 REMEDIES

Each form of IP legislation sets out the remedies that are open to an enterprise for
successfully enforcing its IP rights. Those remedies include a right to be paid damages or an
account of profits (to be elected by the plaintiff) as enshrined under Section 111 of the

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Patents Act, 1970. In addition, the owner of IP rights is able to seek interim and final
injunctions.

4.2.11 DAMAGES AND ACCOUNT OF PROFITS

The owner of IP rights who has established infringement of those rights must elect as to
whether to be compensated for that infringement by payment of damages or account of
profits. There is a doctrinal difference in these forms of compensation. Account of profits is
intended to prevent unjust enrichment to the defendant whereas damages is designed to
put the plaintiff in the same position as it would have held if the infringement had not
occurred. The difference in the amount of money that might be awarded by the court is
hard to define. Usually the plaintiff will seek to undertake an enquiry as to the profits that
may have been earned by the defendant.

4.2.12 ADDITIONAL DAMAGES

At least in relation to infringement of copyright and EL rights the owner of the IPR will be
able to seek an order that the infringers pay ‘additional damages’ where the court is
satisfied that there has been a flagrant infringement of the IP rights. The ACIP Report also
calls for similar rights to be available for registered designs, patents and trademarks.

4.2.13 INNOCENT INFRINGEMENT

Some of the IP legislation limits the remedies available where the defendant can establish
that the infringement was innocent.

4.2.14 LIMITATION PERIODS

Most of the forms of IP legalisation specify the periods within which an action for
infringement must have commenced (known as the ‘limitation period’). In all cases the
period is six years from the date in which the infringement occurred. A failure to commence
an action within that period means the right to enforce the IP rights in respect of the alleged
infringing act will be lost. The practical effect of such a significant delay in enforcing IP rights
is in most cases unlikely to be significant because the commercial imperative has probably
passed by.

4.3 LITIGATION STRATEGY

If the task of managing the IP were to be considered a project then one of the foreseeable
phases of that project is the enforcement of IP rights. As with any project management
exercise it is appropriate, if not best practice, to reassess the overall project at significant
milestones. This is certainly the case when an enterprise is at a stage of having to decide
whether to enforce its IP rights against a suspected infringer or not. In these circumstances
the enterprise should only proceed once it has taken stock of its risks in the context of its
overall business objectives. This entails considering the commercial, legal and, if relevant,
political risks in following through with an IP enforcement strategy. An analysis of risk entails

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being able to identify the risks and this in turn relies upon the enterprise having obtained as
much relevant information as possible to help it identify and evaluate those risks.

The enterprise should obtain appropriate advice from an IP expert (which may include
barristers). The enterprise should have assessed, to the extent possible, the financial
implications of either winning or losing the case. The assessment should consider the impact
upon senior managers and staff because they will be required to assist in the preparation of
the case and to give evidence. Finally the enterprise needs to clearly understand the
ramifications if it were to win or lose the case.

All of these issues should be set out in an appropriate risk management plan which would
usually be prepared by its advisers. The enterprise should seek from its legal advisers a
budget for the conduct of the IP enforcement proceedings. The advisers to the enterprise
should also be able to specify the critical ‘break points’ in which an enterprise may seek to
reassess its position and, if thought appropriate, change tack. This may entail settling or not
continuing with the action.

4.3.2 MAREVA INJUNCTION

A Mareva injunction is an ex-parte injunction2 that has the effect of freezing the assets of a
party pending further order or final resolution by the court.3 The Mareva injunction is aimed
at a specific defendant and not at his assets.4 It is to restrain him from taking his assets out
of the court’s jurisdiction.5 If the defendant is not stopped from taking his assets out of the
Court’s jurisdiction then there is a possibility that plaintiff despite getting a judgment in his
favour would be left remediless.

For example, let us imagine a situation where a court of Country Q is not empowered to
pass a Mareva injunction. This means that a defendant can take his assets outside the
Court’s jurisdiction without any problem. A suit is filed by Mr. X (plaintiff), a resident of
Country Q against Mr. Y (defendant), a resident of country P. Mr. Y, being aware of the
possibility that his assets might be attached if he loses the case removes them from the
Court’s jurisdiction to his country P before the trial begins. The court at the conclusion of
trial considers it necessary to attach the assets of Mr. Y, the defendant, in order to give
proper relief to Mr. X, the plaintiff, and orders for the same. However, since the assets that
are sought to be attached are now no longer within the Court’s jurisdiction, having been
removed earlier by Mr. Y, they cannot be attached. And the Mr. X despite a decision in his
favour cannot get his desired relief. Mr. X cannot go to country P to get Mr. Y’s assets to get
his desired relief. The judgment has no value because it cannot be enforced. It is evident
from this that allowing defendants like Mr. Y to take away their assets or property from the

2 An ex-parte injunction is an injunction which is granted without giving the other party a chance to be
heard.
3 Mareva Injunction Definition, available at
<http://www.duhaime.org/LegalDictionary/M/MarevaInjunction.aspx> (accessed on 5th October, 2012)
4Ibid
5Supra note 8

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Court’s jurisdiction gave scope for rampant abuse. For a long time that the Mareva
injunction did not exist, this abuse did take place. Foreign companies, to evade possible
adverse judgments, often removed their assets from the Court’s jurisdiction before the
trial.6 As a result, the plaintiff was left holding nothing more than an empty judgment.7 So to
prevent such irreparable harm to the plaintiff, the court, through an ex-parte Mareva
injunction, freezes the assets of the defendant. 8An ex-parte injunction ensures that the
defendant is not aware of the proceedings and this way, the plaintiff’s right to a relief is
protected. A Mareva injunction is like and akin to “attachment before judgment”.9 It is also
analogous to the remedy of injunction under Order 39, Rule 1 and 2.10

In India, the court is empowered to grant an attachment before judgment or a Mareva
injunction under Order 38, Rule 5 of the Code of Civil Procedure, 1908. Rule 5(1) states that
if at any stage of the suit, the court is satisfied that the defendant with the intent to
obstruct or delay the execution of any decree that may be passed against him, is about to
dispose of, or remove from the Court’s jurisdiction, the whole or any part of his property,
then the court may direct the defendant to furnish security in a specified sum, and place at
the court’s disposal the property or equivalent value, as maybe sufficient to satisfy the
decree. This indicates that two essentials need to be met if the court is to grant a Mareva
injunction under the Rule 5, Order 38. They are:

• The defendant is about to dispose of the whole or any part of his property11 and
• The disposal of property is with the intention of obstructing or delaying the

execution of any decree that maybe passed against him.12

The words obstructing or delaying the execution of any decree that may be passed against
him has been interpreted by the Apex Court to mean that before exercising the power
under Rule 5, Order 38, the court should be satisfied that there is a reasonable chance of a
decree being passed in the suit against the defendant.13

The Indian Courts have acknowledged that the Mareva injunction can be granted in India. In
Sundaram Finance Ltd. v. NEPC India Ltd14the Supreme court approved that the power to
grant an interim injunction extended to granting of a Mareva injunction in appropriate
cases. The Bombay High Court has also stated that the Mareva injunction, a well-known
concept in English law is recognized in India. 15

6Anonymous, The mareva injunction, available at <http://www.lawteacher.net/english-legal-
system/essays/mareva-injunction.php> (accessed on 5th October, 2012)
7Ibid
8Rite Approach Group Ltd v. Rosboron export,AIR 2007 Delhi 145
9Ibid
10Formosa Plastic Corporation Ltd.v Ashok Chauhan, MANU/DE/0259/1999
11(Delhi) Uppal Engineering Limited Pvt. Ltd. v. Cimmco Birla Limited 2005 (2) ARBLR 404 (Delhi) at
¶12
12Ibid
13Raman Technology and Process Engineering Co. and Anr. v. Solanki Traders, (2008) 2 SCC 302 at ¶
4
14[1999]1SCR89
15Ecohidrotechnika LLCVs.Black Sea and Azov Sea Production and Operating Administration of
Shipping and Anr., 2010(4) BomCR 785

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From the above it is established that one, the power of the Court to grant a Mareva
injunction exists in the Indian law and two, Indian courts acknowledge that it can be
granted. Therefore, now it is important to examine as to what the plaintiff has to show in
order to get a Mareva injunction passed in his favour.

A Mareva injunction is one type of temporary injunction. Therefore, the general criteria
that are taken into consideration by the Indian courts to grant a temporary injunction shall
apply to Mareva injunction as well. These criteria include the following-

Prima Facie Case - This means that the plaintiff must satisfy to the court that there is a bona
fide dispute, a strong case for trial which needs investigation and that if a decision is given
on the merits and facts of the case, there is a probability that the plaintiff would be entitled
to the relief that he claimed.16 In other words, the plaintiff must show that he has a good
arguable case.

Irreparable Injury - The plaintiff must further satisfy the court that if the injunction prayed
for is not granted then he will suffer irreparable injury.17 And that there is no other remedy
open to him by which he can protect himself from the consequences of the apprehended
injury.18

Balance of convenience - The third general criteria for a temporary injunction is proving
that the balance of convenience in the favour of the plaintiff. However an English case has
held that in the case of Mareva injunction, the third criteria is not see whether the balance
of convenience is in the favour of plaintiff but to examine whether it is just and convenient
to grant the injunction.19

In Abheya Realtors Private Limited v Ssipl Retail Limited & Another20 the Calcutta High Court
laid down specific criteria for granting a Mareva injunction and held that the claimant must
prove:

• He must have a prima facie or good arguable case and
• He must establish that the asset or assets within the jurisdictions were unlikely to

remain at the time when the judgement would be delivered and
• Must show that as a result of the assets being taken out of the jurisdiction, he would

have no means to satisfy the decree

One point regarding the applicability of the Mareva injunction would like to be made. It has
been stated above that a Mareva injunction is targeted against a specific defendant. This
raises the question as to whether it shall also apply to anon-resident defendant whose
assets are within the jurisdiction of a particular court. Foreign courts have answered this
question in the affirmative. The Canadian Supreme Court in the case of Aetna Financial

16C.K Takwani, Civil Procedure 6 Eastern Book Company (2009) p. 331
17Ibid at p. 332
18Ibid
19Irish Response v. Direct Beauty Products,[2011] EWHC 37 (QB)
20 Available at <http://www.indiankanoon.org/doc/372105/>(accessed on 4th October, 2012)

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Services Ltd. v Fiegelman21 has stated that the gist of a Mareva action is the right to freeze
the assets of the defendant when they are found within the jurisdiction of the court
irrespective of the fact where the defendant resides.22In Rahman( Prince Abdul) v Abu
Taha23, the English court held that the Mareva injunction can be extended to both resident
and non-resident defendants.

However, in India the position on applicability of Mareva injunction to a non-resident
defendant is not conclusive. The Supreme Court of India in the case of M.V.A.L Quamar v.
Tsavliris Salvage (International) Ltd. &Ors24, in its obiter discussed a judgment of the New
Zealand Supreme Court25 and an English case26 on this point.

In Black Clawson International Ltd. v Paperwork Waldorf Aschaffenburg27, the New Zealand
Supreme Court held that it had the jurisdiction to grant a Mareva injunction to a non-
resident defendant.28It stated that the old English procedure of foreign attachment was the
perfect respectable ancestry for this procedure.29 The court further held that granting a
Mareva injunction to a non-resident defendant was necessary if the court wanted to
approach the modern problems associated with the flexibility of the modern business.30
Explaining the flexibility of the modern business the Court stated that in the present age
vast amounts of money could be easily transferred from one country to another in a matter
of seconds as a result of a phone call or a telex message.31 It relied on facts of reported
Mareva cases and the number of Mareva injunctions granted in London to highlight that the
jurisdiction of Courts in Mareva injunction to non- resident defendants was wholesome and
a fulfilling need.32

4.3.3 ANTON PILLER ORDER

An Anton Piller order is an interim order that allows a plaintiff to enter the defendant’s
premises to search and seize evidence, if any, without prior warning.33The fact that such a
search and seizure can take place without any prior warning indicates that this order would
most effective when it is issued ex parte. Thus an Anton Piller order is an ex parte ad interim
order.34 It is imposed on the defendant to restrain him from interfering with a search and

21[1985] 1 S.C.R. 2,Alsoavailable at <http://scc.lexum.org/en/1985/1985scr1-2/1985scr1-2.pdf>
22Supra note 8
23 [1980] 1 WLR 1268
24AIR 2000 SC 2826
25Black Clawson Inter-national Ltd. v. Paperwork Waldhof Aschaffenburg, 1975 AC 591
26RasuMaritima case [1977] 3 All ER 324, 333-334
271975 AC 591
28AIR 2000 SC 2826 at ¶ 53
29Ibid
30Ibid
31Ibid
32Ibid
33SauravBhowmik, Anton Piller and implementation against Software Piracy, March 2012 available at
<http://www.psalegal.com/upload/publication/assocFile/IPR&TechnologyBulletin-IssueXXI.pdf>
(accessed on 6th October, 2012)
34Bucyrus Europe Limited and Anr, vVulcan Industries Engineering Company Private
Limited,2005(30)PTC279(Cal)

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seizure that is conducted by the plaintiff.35These orders are often used together with
Mareva injunctions.36 The effectiveness of an Anton Piller order under the Act is highlighted
through the following example.

We consider a case under the Plant Varieties Act. Let us imagine a situation where a variety
registered under the Act is infringed through being sold by a breeder who is not registered
under the Act.37 The registered breeder of the variety is Mr X. He has registered variety
‘AZP’ under the Act. ‘AZP’ is being sold by a breeder, Mr. Y, who is not registered under the
Act. Mr. X becomes aware of this but to be successful in a suit of infringement he needs to
make sure that the variety being sold by Mr. Y, is ‘AZP and must collect any other evidence
associated with it. Such evidence can be collected by Mr. X if an Anton Piller order is issued
in his favour against Mr. Y. So, is Mr. X allowed to file for an Anton Piller order under the
Act? Section 66(2) of the Act empowers Mr. X to apply for an interlocutory order to preserve
evidence, an infringing variety or any other evidence. For preservation of evidence
mentioned in this sub-section, first it is necessary to collect that evidence. Thus, Mr. X can
under the Act apply for an Anton Piller order. This order would allow Mr. X to enter Mr. Y’s
premises to search for the infringing variety and if found, to seize that variety along with the
other sales proceeds associated with it. Such search and seizure would only help in the
preservation of the infringing variety, documents or other evidence as enumerated in
section 66(2) of the Act. So we see that an Anton Piller order can be extremely effective in
possible infringement suits that would be filed under the Act.

The concept of Anton Piller Orders originated in the English case of Anton Piller K.G. v.
Manufacturing Process Ltd., and Ors.38The court explained that an Anton Piller order was
only an order on the defendant, permitting inspection.39 It commanded him to permit
entry.40It was not equivalent to a search warrant.41The defendant was open to refuse to
comply with the order but he could only do so at his peril of further proceeding for
contempt.42Also, plaintiff’s agents could not use force in the face of defendant’s denial of
permission.43 In other words, great responsibility rested with the solicitor of the plaintiff to
ensure that the order is carried out meticulously with full responsibility for the defendant’s
right.44 Explaining the purpose of the order the Court held that this order was only passed
to ensure that vital evidence in the case was not destroyed and that justice was done
between the parties.45 It was an order based on equity that assisted the plaintiff to establish
its case and to prevent the destruction of evidence by the defendant.46

35Supra note 47
36Ibid
37Section 64(b), The Protection of Plant Varieties and Farmers’ Rights Act, 2001 available
at<http://agricoop.nic.in/PPV&FR%20Act,%202001.pdf>(accessed on 4th October 2012)
38 1976 RPC 719
39Anton Piller K.G. v. Manufacturing Process Ltd., and Ors, 1976 RPC 719, 726
40Ridgewood case, see Anton Piller Order Definition available at
<http://www.duhaime.org/LegalDictionary/A/AntonPillerOrder.aspx>(accessed on 6th October, 2012)
41Supra note 53
42Ibid
43Supra note 54
44Supra note 53
45Ibid
46Supranote 47

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Courts in India have primarily treated Anton Piller orders as a form of injunctive relief.47 This
implies that all Anton Piller order applications shall be dealt under Order 39 of the Code of
Civil Procedure which deals with temporary injunctions and interim orders. It also means
that generally the plaintiff must show:

• A prima facie case
• Irreparable Injury
• Balance of convenience in his favour before such an order is granted

These 3 grounds have been explained in detail earlier in the note, in the part that deals with
Mareva injunctions. However, the specific criteria that the Indian courts have evolved with
respect to Anton Piller orders which, the plaintiff must show in order to get an order issued
in his favour, is as follows:

• There is an extremely strong prima facie case against the defendant48
• The damage, potential or actual, must be very serious for the plaintiff49 and

• There must be clear evidence that the defendants have in their possession relevant
documents or things and that there is a real possibility that they may destroy such
material before an inter-application can be made.50

The first two conditions are normally satisfied through proof of title to intellectual property
rights and clear evidence of infringement.51 The third condition, likelihood that an infringer

will dispose of important evidence, is normally the crucial element of proof required to
obtain an Anton Piller order.52

Anton Piller orders have been recognized in India for over the past 20 years.53 In Hindustan
Pencils (P) Ltd. vs. India Stationery Products Co. and Anr54 , the Delhi High Court, citing Kerly

in Law of Trade Marks and Trade Names, stated that in extremely urgent cases an “Anton

Piller” order, for inspection of defendant’s premises without prior warning and discovery of
his records, maybe obtainable.55 Such an order was similar to the ex parte interlocutory
order to take an inventory of article etc. passed in an ordinary suit.56In Mohit Bhargava v.
Bharat Bhushan Bhargava and Ors57 , the Apex Court held that an Anton Piller order could

be issued even if the property or person concerned is outside the jurisdiction of the
Court.58The Delhi High Court in Autodesk Inc. and Anr v Mr. A.V.T. Shankardass and

47Ibid

48Supra note 47

49Ibid

50Supra note 47

51Viacom Ha! Holding Co. v. Persons Unknown, Available at

<http://reports.fja.gc.ca/eng/2001/2001fc27974.html>

52Ibid

53Supranote 47

54AIR 1990 Del 19 ( This particular case has been cited over 98 times)

55AIR 1990 Del 19 at ¶13

56National Garments, Kaloor, Cochin VsNational Apparels, Ernakulam, Cochin, AIR 1990 Ker 119 at ¶ 7

57 (2007) 4 SCC 295

58Mohit judgment at ¶10 (In this case, the executing court which had passed the Anton Piller order lost

jurisdiction over the case at a later point of time. The person against whom the Anton Piller order was

issued thus argued that this order should fall to the ground. The Apex Court rejected this argument and

held as stated)

67

Anr59while dealing with software piracy held that where the Court was satisfied that the
party is not able to produce the desired evidence for reasonable circumstances, it may assist
a party by appointing a Local Commissioner to get that evidence.60The Court stated that the
objective of appointment of Local Commissioner, in software piracy matter was to preserve
and protect the infringing evidence and not to collect it.61 The incriminating evidence could
only be obtained from the premises of the opposite party alone.62 And in the absence of an
ex parte appointment of a Local Commissioner, there was likelihood that such evidence may
be lost, removed or destroyed.63It further held that request for ex parte appointment of
Local Commissioner was intended to sub serve the ends of justice as it was imperative to
have an element of surprise so that the actual position is not altered.64Moreover, in cases of
an action of infringement of software and piracy, issuance of notice to opposite party
regarding application for appointment of Local Commissioner by Court take evidence and
assess infringement was not mandatory.65

Thus, the Autodesk66case could possibly affect the manner in which an Anton Piller order
may be executed under the Act when such cases arise. All of this shows that an Anton Piller
order is a viable relief that can be claimed under the Act.

Therefore Anton Piller orders are particularly effective in cases of alleged trademark,
copyright or patent infringement. In order to obtain such an order, the applicant must prove
that:
it has a cause of action or has suffered damages;
the offending party possesses specified documents or objects that constitute vital evidence
to substantiate the applicant's claim; and
there is a well-founded belief that the evidence may be hidden, moved or destroyed before
the case comes to trial.

Anton Piller orders are often used together with Mareva injunctions, which are used to
restrain defendants from removing assets from the jurisdiction of the court. The genesis of
the Anton Piller order can be traced in India in the case of Anton Piller Vs Manufacturing
Processes (1976) RPC 719.

A court would generally bestow an Anton Piller order only if the following three conditions
are fulfilled:

existence of a strong prima facie case
potential or real damages
Presence of clear evidence must exist that the defendants have in their possession
incriminating documents or things and that there is a real possibility that they may destroy
such material before any proceedings inter parties can be made.

59 AIR 2008 Del 167
60Supra note 73
61Ibid
62Supra note 73
63Ibid
64Supra note 73
65Ibid
66Ibid

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4.3.4 JOHN DOE ORDER

A John Doe order is passed against nameless/unknown defendant(s), who have allegedly
committed some wrong and whose identity cannot be ascertained by the plaintiff.67 These
are used in situations where there is a great chance of infringement to take place and if the
plaintiff seeks out an individual infringer every single time, then there would be a financial
loss, loss of time, and other types of losses to the plaintiff. So a plaintiff applies for a John
Doe order to avoid delay in the process of justice due to anonymity of the potential infringer
or defendant.68 The court names the defendant as John Doe until such time the defendant is
identified.69 If after passing of this order, the plaintiff comes across an infringer, then he can
serve a copy of the same to the defendant/infringer and seek adherence.70 If the
defendant/infringer fails to comply with the order, then it can result in initiation of
contempt proceedings against him.71 It is however, open for the defendant to argue his case
and prove its innocence in a court of law.72

In another hypothetical example under the Plant Varieties Act. For example let us
imagine a situation where Monsanto comes into the Indian market with their registered
variety ‘POQ’. Owing to its popularity and quality, various people start producing or selling
varieties, the denomination of which is identical with or deceptively similar to denomination
of registered variety ‘POQ’. Monsanto is aware of the fact that such varieties are being sold
or produced and that infringement as per section 64(a) of the Act is taking place yet, it
cannot do anything because it is not aware of any specific infringer/defendant who is selling
or producing the variety ‘POQ’. To take care of this situation, Monsanto can get a John Doe
order issued in its favour. This will be an order against all infringers/defendants whose
identity is unknown to Monsanto. And if Monsanto comes across an infringer/defendant,
then Monsanto shall serve the order to this particular infringer and seek compliance failing
which the defendant can face contempt proceedings.

The concept of John Doe orders can be traced back to the reign of England’s King Edward III
(1312-1377), when such orders were used to refer to unidentifiable defendant.73 A John
Doe order being an interim order, the court is empowered to grant such an order under
Order 39 Rules 1 and 2 of the Code of Civil Procedure, 1908.74 Therefore principles that are
applicable for getting interim relief are applicable for obtaining a John Doe order as well.75
The plaintiff must show

A prima facie case
Irreparable Injury

67 Gowree Gokhale, Payal Chaterjee, Aarushi Jain, John Doe Orders: A Boon for IP protection, available
at <http://www.legalera.in/Front-Page/john-doe-orders-a-boon-for-ip-protection.html> (accessed on 7th
October, 2012)
68 Ibid
69 Ibid
70 Ibid
71 Ibid
72 Ibid
73 Ibid
74 Ibid
75 Ibid

69

Balance of convenience in his favour before such an order is granted
These 3 grounds have been explained in detail earlier in the note, in the part that deals with
Mareva injunctions.

These orders have been recognized and passed in India. The first John Doe order was
granted in the case of Taj Television v Rajan Mandal76. The Court referring to the Canadian
judgments of Jackson v Bubels77 and Dukoff v Teronto General Hospital78 observed that the
act of naming a party is considered a mere misnomer and as long as the litigating finger is
pointed at a particular person, then the misnomer is not fatal.79 In Luxottixa Group Limited
vs. Ashok Kumar, the court passed an order against unknown counterfeiters restraining
them from selling and manufacturing of counterfeit optical eyewear bearing the famous
trademark “RAY BAN”.80 The Delhi High Court also restrained unidentified persons from
infringing labels, packaging materials and artistic work of the plaintiff, who was engaged in
the sale and manufacture of cigarettes.81

John Doe orders have been issued in India to check piracy and unauthorized transmissions
as well. In Satellite Singapore PTE Ltd. Vs. Star Cable Network and Ors, the Delhi High Court
passed orders prohibiting the respondents from broadcasting/using unauthorized signals of
the appellant for downloading/telecasting purposes during the Indian Premier League
cricket tournament.82 The court further allowed seizure of signal transmitting devices, if
channels were downloaded without proper authorization.83 The same trend was followed in
ESPN Software v Tudu Enterprises84. The plaintiff in this particular case apprehended
unauthorized cable transmission of his channel which was telecasting the ICC Cricket World
Cup.85 As this would lead to irreparable loss, damage, loss of subscription and advertisement
revenues the plaintiff filed for a John Doe order which was granted by the Delhi High
Court.86 John Doe orders have also been granted by other states. The District Court of
Andhra Pradesh granted one in 14 Rees Entertainment Pvt. Ltd. V P. Srinivasulu, for the
movie Dookudu.87 The Bombay High Court has also passed a John Doe order to Viacom 18
for the movie “Gangs of Wasseypur”.88

John Doe orders were modified sometime around 2010 to be applied to the internet.89 The
only problem that arose out of this was that without any limitations as to how these orders
would apply over this very different medium, John Doe orders started being utilized by

76 CS (OS) No. 1072/2002
77 28(1972) DLT.500 (B.C.C.A)
78 (1986) 54 O.R.50 (H.C.)
79 This was referred in ESPN Software India Private Limited vs. Tudo Enterprise, CS (OS) 384/2011
80 Supra note 82
81 Ardath Tobacco Company Limited vs. Mr. Munna Bhai & Ors., 2009(39)PTC208(Del).
82 Supra note 82
83 Ibid
84 CS (OS) 384/2011
85 Payel Chatterjee, What’s in a name... John Doe arrives in India, available at
<http://www.nishithdesai.com/Research/Article/IPBA%20paper.pdf> (accessed on 7th October, 2012)
86 Ibid
87 Apar Gupta, Access to this site has been blocked as per Court Orders, June 25, 2012, available at
<http://barandbench.com/brief/3/2528/access-to-this-site-has-been-blocked-as-per-court-orders>
(accessed on 7th October, 2012)
88 Ibid
89 Ibid

70

Plaintiffs in an increasingly generalized fashions.90 To prevent any sort of copyright or other
form of infringement over the internet, instead of specifically targeting the URLs which
contained the unauthorized copy, John Doe orders for internet infringement started
targeting all possible sources of infringement en masse.91 One of the first cases in this
regard was the John Doe order granted to the producers of the movie Singham.92 They were
apprehensive of the fact that copies of the movie would be made and sold/distributed in
form of DVDs/CD in the market and/or shown on TV by cable operators.93 Apprehending
huge financial losses and the fact that such distribution would prevent movie goers from
going to the theatre, the producers contended for a John Doe order.94 The Delhi High Court,
even though the film had not been released, relying on the principles of Quia TImet passed a
restraining order against all defendants and other unnamed undisclosed persons from
distributing, displaying, duplicating, uploading, downloading or exhibiting the movie in any
manner and infringing the copyright of the plaintiff through different mediums without prior
license from the plaintiff.95

Since a John Doe order has been passed on lines of a Quia Timet injunction, it is important
to point out what a Quia Timet injunction is. A Quia Timet Injunction is similar to a John Doe
order in the sense that it is passed against a defendant whose identity is unknown.
However, the difference is that, it is passed prior to when the infringement takes place.
They are granted only upon proof of imminent danger, threatened injury being practically
irreparable and the impossibility to protect the plaintiff’s interests in the event of injurious
circumstances.96 How such an injunction can apply in the context of the Act is illustrated
above.

In the above stated example, let us further assume that Monsanto is planning to launch
another variety ‘POR’ in the market. However, in light of its experience with the registered
variety ‘POQ’ it is now apprehensive that when the variety ‘POR’ is introduced in the
market, then owing to the reputation, quality etc of Monsanto, various people may come up
with varieties, the denomination of which is identical or deceptively similar to that of variety
‘POR’. In order to avoid this, Monsanto can apply for Quia Timet Injunction. Thus, we see
that a Quia Timet injunction may also be applicable.

While the scope of John Doe orders has been steadily increasing, there have been certain
judgments that have highlighted that such orders should be cautiously used. The Delhi High
Court in the case of Indian Performing Right v. Mr. Badal Dhar Chowdhry, held that the
courts should be extremely cautious in granting ‘John Doe’ orders.97 They must specify the
extent of applicability of such orders, the product or article concerned to which it relates to

90 Ibid
91 Ibid
92 Supra note 82, also see Apar Gupta, Access to this site has been blocked as per Court Orders, June
25, 2012, available at <http://barandbench.com/brief/3/2528/access-to-this-site-has-been-blocked-as-
per-court-orders> (accessed on 7th October, 2012)
93 Ibid
94 Ibid
95 Ibid
96 Fletcher v. Bealey (1884) 28 Ch.D. 688 at p. 698, available at Gowree Gokhale, Payal Chaterjee,
Aarushi Jain, John Doe Orders: A Boon for IP protection, available at <http://www.legalera.in/Front-
Page/john-doe-orders-a-boon-for-ip-protection.html> (accessed on 7th October, 2012)
97 Supra note 82

71

and the steps that can be taken by the aggrieved party to enforce such order.98 With
respect to infringement over the internet, the Madras High Court in the case of Creative
Commercials v. Bharat Sanchar Nigam Limited99 held that the plaintiff is obliged to identify
the particular URL where the infringing copy has been kept and the block cannot extend to
the entire website.

All of the above highlights that John Doe orders are granted extensively in the India. It has
also been pointed out how a John Doe order can be used under the Act. Thus it can be
stated that in case of infringement, it is a viable relief.

4.3.5 Norwich Pharmacal Order:

A Norwich Pharmacal order (NPO) requires a respondent to disclose certain documents or
information to the applicant. The respondent must be either involved or mixed up in a
wrongdoing, whether innocently or not, and is unlikely to be a party to the potential
proceedings. An NPO will only be granted where "necessary" in the interests of justice.100

Judicial order, in accessing further evidence if any and obtaining information critical to the
ongoing case, supplements the knowledge of the Court and thereby ensures transparency in
the proceedings. Norwich Pharmacal Order is one of the tools available to the applicant
whose significance is growing with judicial set-ups of different nations recognizing the
import of availability of such an option. When granted, Norwich Pharmacal orders compel
pre-action disclosure, typically by third parties.

The Order was founded in Britain, in an appeal in the matter of Norwich Pharmacal
Company & Others v Commissioners of Customs and Excise101. The reason behind
underlying such orders was stated by Lord Reid in paragraph 12 of the case:

“if through no fault of his own a person gets mixed up in the tortious acts of others so as to
facilitate their wrong-doing he may incur no personal liability but he comes under a duty to
assist the person who has been wronged by giving him full information and disclosing the
identity of the wrongdoers." In this case the applicants were aware that their patent was
being infringed by illegal importations, however they had no inkling as to who the importers
were. They sued the customs and excise commissioners. They further sought an order for
disclosure of their names and contact details, basing the claim on the equitable right to file a
bill for discovery, which was a cause of action seeking disclosure of information from the
defendants. Overlooking the long standing “mere witness” rule, the House of Lords noted
that in the absence of the entire information, the ultimate wrongdoer would never be
brought to trial.

The Norwich Pharmacal jurisdiction is a means whereby a party may request the court to
order the disclosure of information where there has been or may have been wrongdoing by

98 Ibid
99 C.S No. 294/2012
100 Norwich Pharmacal orders: a quick guide retrieved from http://ld.practicallaw.com/0-211-3137 , last
accessed on 22nd of October, 2012
101 [1973] 3 WLR 164

72

a third party and where the information is required in order to seek justice in respect of that
wrongdoing. The jurisdiction originates in the field of patent law102 and was first and most
famously invoked in the context of national security in the Binyam Mohamed case.103

The Justice and Security Bill of the United Kingdom describes this jurisdiction in clause 13(1),
in the following terms—
"This section applies where, by way of civil proceedings, a person ("A") seeks the disclosure
of information by another person ("B") on the grounds that—
(a) wrongdoing by another person ("C") has, or may have, occurred,
(b) B was involved with the carrying out of the wrongdoing (whether innocently or not), and
(c) the disclosure is reasonably necessary to enable redress to be obtained or a defence to
be relied on in connection with the wrongdoing."104
Illustration:

Let us for instance say that a certain Mr. Hood, a man holding a position of paramount
responsibility is summoned by the head of the organization and is told that he’s been
alleged of lack of proficiency and misappropriation of the organization’s finance by an
unidentified person, and the director refuses to divulge the identity of the source.
Consequently, Mr. Hood is subject to a series of disciplinary hearings and is unable to
disprove the charges slapped against him as he is ignorant of quintessential information, the
source. In such a situation, if an order of this calibre is made available to Mr. Hood, by an
understanding judiciary, the claimant will be better placed to argue for his cause.105

The Canadian jurisprudence has willingly embraced and inducted the tool of NORWICH
PHARMACAL ORDER as a judicial endowment. In a matter before the Canadian Court, Glaxo
Wellcome PLC v. M.N.R106, the claimant, owner of a patented drug sought the disclosure of
the people violating its patent from the custom officials, which was rightfully granted to
him.

Scope of the Order:

The Norwich Pharmacal order has been restricted in its scope to cover only tortuous
offences, as was observed by Sedley, L.J. in Interbrew v Financial Times.107 However, in
Ashworth v MGN108 the House of Lords in the voice of Lord Woolf, C.J. found no objection in
expanding this relief to criminal offences as long as the person seeking the order was a
victim of the crime.

102 Ibid.
103 This was a complex case in which there were six judgments at first instance (i.e., in the Divisional
Court) and two judgments in the Court of Appeal. The latter are authoritatively reported at [2011] QB
218, where the full reference to the case is given as R (Mohamed) v Secretary of State for Foreign and
Commonwealth Affairs (No 2) [2010] EWCA Civ 65, [2010] EWCA Civ 158.
104 Justice and Security Bill [HL]: Norwich Pharmacal jurisdiction - Constitution Committee Contents,
retrieved from http://www.publications.parliament.uk/pa/ld201213/ldselect/ldconst/31/3103.htm#n4 on
22nd October, 2012
105 See P v. T [1997] 1 W.L.R. 1309
106 (1998), 162 D.L.R. (4th) 433
107 [2002] EWCA Civ 274
108 Ashworth Hospital Authority v MGN Ltd [2002] UKHL 29

73

In Norwich Pharmacal the purpose of the information was to enable the applicant to
commence proceedings against the wrongdoer. This is no longer a prerequisite. The other
question that arose in respect to this order was whether a NPO can be made in one
jurisdiction in order to identify a defendant coming under another jurisdiction.109

The following years witnessed the widening of the ambit of the term “disclosure” and the
grounds for seeking the same. In Mitsui v. Nexen Petroleum110, Lightman, J. declared that a
Norwich Pharmacal order can be passed where “the claimant requires disclosure of crucial
information in order to be able to bring its claim or where the claimant requires a missing
piece of the jigsaw”. This judgment gave rise to the “missing piece of the jigsaw” test which
was used most recently in R. (on the application of Mohamed) v Secretary of State for
Foreign and Commonwealth Affairs.111

The Digital Economy Act of 2010 established by the UK parliament for regulation of digital
media envisaged the incorporation of the norwich pharmacal orders. the primary concern of
the law makers in this regard is not issuance of information but the subsequent handling of
it.

The availability of such enforcement is a judicial respite since an option for obtaining further
information is in any case better than limited information. In India, the principle of Norwich
Pharmacal order’s has not been put to use so far since the concept is relatively new.
However, the Plant Variety Protection and Farmer’s Rights Act, with the enshrinement of
section 66, provides for various reliefs available to the plaintiffs on account of infringement
of any of his rights to market, distribute, import or export the varieties.112 The Norwich
Pharmacal order is an effective measure to ensure that the ultimate wrongdoer is put to
trial. Under this order, if a person is mixed up in a wrong, irrespective of his involvement
being voluntary or obligatory in nature, is immaterial. The fact that he was involved is
sufficient to bring him to action. However, as has been mentioned earlier, a mere bystander
cannot be brought to trial.

Illustration:

Let’s say Thiruma, a local farmer in Gujarat has learnt to cultivate rice by combining his
traditional knowledge and skills despite the paucity of water and has patented this
technique. A certain Ms. Chelluma comes to visit Thiruma from Rajasthan. Both being arid
states, Chelluma is marvelled by the technique and Chelluma sells this piece of information
to her Sarpanch in Rajasthan. Thiruma has filed a suit against Thiruma after learning that her
village in Rajasthan is now cultivating rice on the basis of his technique. He sues her, for
infringement. He is aware that someone bought the idea from Chelluma but his knowledge
ends here. He now, by virtue of Norwich Pharmacal order’s can compel Chelluma to
handover the name of the person she traded information with.

109 See BSC v Granada Television [1981] A.C. 1096
110 [2005] EWHC 625 (Ch)
111 [2008] EWHC 2048 (Admin).
112 Section 2(c),The Protection of Plant Varieties and Farmers’ Rights Act, 2001 available
at<http://agricoop.nic.in/PPV&FR%20Act,%202001.pdf> (last accessed on 22nd of October 2012)

74

4.3.6 Cease and Desist Letter:

A cease and desist letter refers to an analogous demand letter, having no governmental
authority behind it but threatening legal action.113

Failure to take an action once it is apparent that there may have been an infringement of
the patent owner’s right could imply waiving of his right. The cease and desist letter usually
denotes that the use of the subject matter in question is the standalone right of the owner
who enjoys the right of exclusivity over it. It then describes how the alleged infringer has
used the prospective plaintiff’s right and demands that the alleged infringer ceases and
desists the further use of this property.114 Even if the cease and desist letter does not
accomplish the object of convincing the infringer to cease his or her actions, it nevertheless,
provides an actual notice of the patent, thereby, enabling the patent owner to recover the
damages after the date of the cease and desist letter was sent. 115

In Dell Computer Corporation v. Arun Kumar and Ors., the plaintiff, an American who are
internationally recognized for their computer-related consulting, installation, maintenance,
leasing warranty and technical support services, have registered their trademark, both
internationally, as well as the their liaison with India. In March 2001, while flipping through
Yellow Pages, they encountered a company, Dell Technologies at Bangalore addressed
through its proprietor Arun Kumar, defendant No. 1. The plaintiffs sent a cease and desist
letter, to the defendant intimating them about the deception being meted out due to such
an infringement of exclusive right in the usage of the mark ‘Dell”. This triggered a series of
telephonic negotiations between the two, which however resulted in the initiation of a legal
proceeding as the defendant sought to obtain more money in order to drop the name “Dell”
from his company. The defendants however did not turn up, as a result of which it was an
ex-parte hearing. The Delhi High Court held that in the absence of concrete proof and
evidence to the contrary, the plaintiffs’ rights are to be restored.

In Exphar Sa And Ors. vs Bharat Shah And Anr.116, while deciding the jurisdiction of the
plaintiff, observed that “the cause of action for the present suit first arose in the month of
November, 1993 when the defendant's attorneys addressed a cease and desist letter to the

113http://books.google.co.in/books?id=35dZpfMmxqsC&pg=PA141&lpg=PA141&dq=cease+and+desist+
order&source=bl&ots=k9tUZFogIa&sig=YNYFhApCmGbTWlFYW17SRs5Vqk&hl=en&sa=X&ei=fD2GUI
q-J4PjrAeB-YC4DA&ved=0CDsQ6AEwAg#v=onepage&q=cease%20and%20desist%20order&f=false
accessed on 23rd October, 2012; See also, A Dictionary of Modern Legal Usage, Bryan A Garner,
Oxford University Press
114http://books.google.co.in/books?id=LEzQiYQmPb8C&pg=PA70&lpg=PA70&dq=cease+and+desist+le
tter&source=bl&ots=JlvInmC4Kb&sig=subhRl9qACq2o9VQYmPkw4nW2M&hl=en&sa=X&ei=FS6GUM
PZFIzkrAeQ04GwCQ&ved=0CDQQ6AEwAQ#v=onepage&q=cease%20and%20desist%20letter&f=fals
e accessed on 23rd of October, 2012; See also, Protecting your company's intellectual property : a
practical guide to trademarks, copyrights, patents & trade secrets. Deborah E Bouchoux, AMACOM,
2001
115http://books.google.co.in/books?id=x4H0ulrSDIUC&pg=PA406&lpg=PA406&dq=cease+and+desist+o
rder&source=bl&ots=iYpKz_LUGa&sig=kcIRdHB60YMUxftJvtWQSmkAiCs&hl=en&sa=X&ei=fD2GUIq-
J4PjrAeB-YC4DA&ved=0CGMQ6AEwCA#v=onepage&q=cease%20and%20desist%20order&f=false
accessed on 23rd October, 2012; See also, The Securities Enforcement Manual, 2nd edition, Kirkpatrick
and Lockhart Pretson Gates, Ellis LLP.
116 2003 (26) PTC 461 Del

75

plaintiff”, implying that the legal engine to restore the infringed right is restored as soon as
such a notice is sent.

In Mars Incorporated v. T. Raghulal and Anr.,117 the plaintiffs instituted a trial praying for a
permanent injunction against the defendants insofar as the use of goods under their
trademark is concerned. The Court held that the issue in question was not infringement of
trademark but the resentment of the plaintiffs for they were operating only in three states.
The Court granted an interim relief so the activities were compelled to be “ceased”,
however not desisted.

In Sasken Communication Technologies Ltd. Vs. Mr. Anupam Aggarwal and Ors118, the
defendants were charged for the infringement of trademark under sections 11, 29(4) and
29(5), as the defendants were using “Sasken”. Before instituting the proceedings, the
plaintiff had already sent a cease and desist notice to the defendants. The Court ruled in
favour of the plaintiffs and granted the order.

Therefore the cease and desist letter should address the following elements:

• It should specify the form of IP that is being infringed. In respect of registered IP this
includes identifying the registration details, which enables the recipient of the letter
to search the relevant register to confirm the IP rights that are being enforced.’

• It should set out a description of the alleged infringing act including the date on
which the act was considered to have occurred.

• It should clearly demand that the recipient of the letter cease to act in an infringing
manner and that if the recipient fails to do so then the enterprise may seek an
appropriate remedy from the court without further notice.

• It would usually identify the nature of remedies available. It is also open to the
enterprise to place other demands upon the infringer which could be otherwise
obtained from a court including:

• delivery up or destroying the infringing articles;
• providing documentation of sales or other exploitation of the infringing articles.
• It is usual to seek a response within a reasonable time frame from one to two weeks

although this will vary depending on the circumstances.

The IP adviser for the enterprise will most often issue a letter. There are two reasons for
this: 1) The IP adviser will be able to craft the letter in a manner which should avoid any
reasonable prospect of an action for unjustified threats. 2) A letter from a firm of lawyers
sends a message to the recipient that the enterprise is serious about protecting its IP rights
and has already taken advice on its legal position.

Before issuing the cease and desist letter it should be noted that a number of practical steps
be taken including:

117 2009(40)PTC460(Del)
118 2009(41)PTC523(Del)

76

• Obtaining evidence of the infringing act: This may entail purchasing articles and
obtaining a statement from the individual who purchased the infringing article
together with any supporting documentation such as receipts. Photographs and
videotape are also useful evidence to have in support of the enforcement action in
the event that the enterprise wishes to obtain orders from a court;

• the accurate details of the infringer should be obtained to the best of the ability of
the enterprise. This includes undertaking company and business name searches.

The cease and desist letter should be sent by registered post to the infringer and by
facsimile if a fax number of the infringer is known. Depending on the urgency of the matter
it may also be appropriate to have the letter of demand personally delivered.

The effect of the cease and desist letter is significant. First, it protects the enterprise against
an order for costs where the plaintiff would have otherwise argued that it would have
agreed to the demands had it been notified to them prior to any court action. Second, if the
infringer repeatedly infringes the IP rights after receiving a letter of demand it would be
evidence of a deliberate intention to infringe those IP rights. This may be persuasive for a
court in deciding whether to grant an injunction or consider whether there has been a
flagrant infringement that would entitle the enterprise to additional damages. Third, it will
also preserve the right of the enterprise to elect to obtain the order for an account of profits
because the infringer has been made aware of the enterprise’s IP rights.

Of course there are quite often circumstances where the enterprise believes it must act with
great speed in order to preserve evidence of the infringing activity. By issuing a letter of
demand the infringer has an opportunity to destroy that evidence. In these cases it is
possible to apply to the court for an ex parte hearing where the enterprise can put its case
and seek injunctions and/or an Anton Pillar order that enables it to preserve such evidence.
There are particular rules concerning ex parte hearings and the issuing of Anton Pillar orders
given the draconian nature of them, which will be well known to the enterprise’s legal
advisers.

Though Litigation is a very strong recourse which enterprises take to enforce their
Intellectual Property, but it should be the last resort. Preferable alternatives to Litigation
should be 1) Cross Licensing 2) Alliances 3) Royalty fee payments.

4.4 UNJUSTIFIED THREATS

Most of the IP legislations provide for a counter-attack from a party who has received a
threat that it will be sued for infringement of IP rights which is unjustified. Consequently any
enterprise purporting to enforce its IP rights needs to tread carefully otherwise it may face
having to pay damages and be the subject of injunctions. The terminology used in the Trade
Marks Act is in respect of ‘groundless threats’. The other Indian IP statutes contain
analogous provisions and the case law in respect of them helps present a series of principles
that should be considered before the issuing of a letter of demand.
A ‘threat’ is not defined in the IP legislation but it seems that it can be made in any manner,
whether oral or in writing. It has been found that it can be made under a ‘without prejudice

77

letter’. Till date there is yet to be a decided case dealing with a threat by way of email
although there is no reason as to why this could not be so.

The mere notification of the existence of a right to sue for infringement of IP rights does not
constitute a threat. There is a test to determine whether there is a threat or not, which is:
whether the language would convey to any reasonable person that the author of that
particular document is intending to bring proceedings for infringement against a person said
to be threatened. It should be noted that direct words are not necessary to determine that
an action would be taken. This test was applied in U and I Global Trading (India) Pty Limited
v. Tasman- Warajay Pty Limited, (1995) 32 IPR 494.

The mere citing of all relevant details of registration and priority will not constitute a threat.
This test was applied in Rosedale Associated Manufacturers Ltd. v. Airfix Products Limited
[1956] RPC 360. The issuing of a general warning concerning infringement would ordinarily
not constitute a ‘threat’.

An indication that the enterprise will protect its interest with 'utmost vigour' constitutes a
threat, this was held in Rosedale Associated Manufacturers Lts Case. Expressing an intention
to enforce rights in a reasonable manner also constitutes a threat, this was held in Bowden
Controls v. Acco Cable Controls Ltd., [1990] RPC 427 or an intention to 'do our best to throw
the dirt around regarding our patents' constitutes a threat, which was held in HVE (Electric)
Limited v. Cufflin Holdings Limited [1964] RPC 149. A clear statement that the enterprise
does not have the rights to issue legal proceedings will of course not constitute a threat. The
judiciary came to this conclusion in U and I Global Trading (India) Pty Limited v. Tasman -
Warajay Pt’y Limited (1995) 32 IPR 494.

The threat should be explicitly restricted to the jurisdiction in which the infringement has
allegedly occurred. Essentially if the alleged infringement acts are found to constitute
infringement then the threat is justified. Consequently the determination of whether an
unjustified threat has occurred will only be determined once the issue of infringement has
been settled.

The infringement action must be undertaken with ‘due diligence’. In other words, the
enterprise cannot wait too long to commence and pursue its action for infringement
otherwise there will be a risk of counter-action for the groundless threats.

The enterprise while dealing with unjustified threats should follow the following points
when dealing with cease and desist letters

• only assert actions that can be proved;
• only refer to multiple forms of IP rights if infringement can be proved of all of those

IP rights;
• only assert infringement where and when there is a will to actually institute

proceedings.

78

4.5 PATENTS AND INFRINGEMENT

The following activities have been held to be infringement activities over a registered
patent. These activities were laid down in the case of Raj Prakash v. Mangat Ram Chowdary
AIR 1978 Del 1:

• making a patented product;
• using the patented process to make a product;
• exporting a patented product for commercial purposes;
• importing when the goods are introduced into the jurisdiction;
• making, hiring, selling or otherwise disposing of a product resulting from the use of a

patented method.

Raj Prakash v. Mangat Ram Chowdary, “In the above mentioned case Raj Prakash the
appellant produced and marketed a toy called ‘Viewer’. The product used a 35 mmn
medially cut positive film on which pictures could be viewed through a lens fitted in a viewer
specially designed for this product alone. He had obtained a patent bearing # 111926 and
declared that this ‘Viewer’ was his invention. It is important to note that the Viewer was
quite attractive enough for children and was also used for educational purposes. Raj Prakash
had found out that the defendent one Mangat Ram Chowdhary had infringed the ‘Viewer’
patent and was also manufacturing and selling his product out in the open market. The
defendants company was manufacturing and selling in the open market film strips viewer
which were identical to and a copy of the viewers manufactured by Ram Prakash for which
he already had a registered patent. The court decided in favour of the Ram Prakash and
ordered the defendant to restrain from using Patent # 111926.”

Actions for enforcement of patents invariably involve a challenge on the validity of the
patent. Under Indian patent law the sale of a patented product without conditions entitles
the purchaser to use the product freely although the patent owner may impose conditions
on the sale concerning its use and those conditions will apply to any person who has notice
of them. This is to be compared with the position in the United States where the sale is
taken to have exhausted the rights of the patent owner. Of course, there are some aspects
where the patent system can be used to the advantage of the enterprise seeking to enforce
its patent rights. If the enterprise is aware of a patent infringement it can request the Patent
Office to publish a complete application for a standard patent. This puts the infringer on
guard and entitles the applicant to the relevant remedies once the patent is granted: This
has been provided under section 54(1) of the Patents Act.

If the enterprise becomes aware of a competitor’s patent application, the enterprise is open
to lodge a notice with the Patents Office that it is concerned that the competitor’s invention
is not patentable. This has been provided under Section 55A of the Patent Act. The
competitor will then be notified of this notice and the Commissioner of Patents can consider
it in the course of examination of the application.

It is also open to an enterprise to pre-empt any infringement actions by a competitor. The
enterprise can seek a declaration from the court that its exploitation of an invention will not
constitute infringement of another person’s patent.

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Before commencing any such action the enterprise must request from the competitor a
written admission that the proposed exploitation by the enterprise would not infringe the
competitor’s patent and give the competitor ‘full written particulars’ of the proposed
exploitation and undertake to pay a reasonable sum for the competitor’s expenses in
obtaining advice about whether the proposed exploitation would infringe the claim. These
preconditions pose some commercial difficulties for the enterprise. Informing a competitor
of its proposed commercialisation strategy and taking legal advice will usually not sit well
with the management of the enterprise. Not surprisingly any decision to seek a non-
infringement declaration needs to be weighed against the business objectives of the
enterprise.

The effect of obtaining a non-infringement declaration is that the enterprise is free to
exploit the invention in a manner that was disclosed to the competitor. This raises a
difficulty if the commercialisation strategy changes, as is often the case once the reality of
market conditions is felt by the enterprise. Nevertheless this can be a powerful tool for an
enterprise seeking to break into a new market which is dominated by one or few
competitors. The competitor may be able to use its financial muscle to manipulate the court
system by extending litigation against the enterprise to prevent its entry into the market. A
declaration for non-infringement will cut through this litigious play.

4.5.1 INTERNET AND BUSINESS METHODS

The Internet itself does not present any novel legal principles relating to the enforcement of
IP. However, the advent of patents for business methods particularly in an online
environment and for software raises the stakes for infringement of IP rights. The potential
damages that could be incurred are now potentially much greater than a decade or so ago.

Now if we look at how companies have enforced their IP on an infringer we should not miss
the case of Priceline.com suing Microsoft Inc. Priceline.com which allows consumers to bid
on the internet for plane tickets and hotel rooms had obtained a patent on software which
reverse-auctioned air tickets. Priceline said that Microsoft had violated this patent by
unveiling a service on Expedia.com (a Microsoft website)

The lawsuit by Priceline was centered on Expedia's ‘Price Matcher’ service pertaining to
hotel rooms and airline tickets. Eventually both Microsoft and Priceline.com settled their
dispute, with Expedia agreeing to pay royalties for its ‘Price Matcher’ service to Priceline.

4.5.2 USE OF DIVISIONAL APPLICATIONS

If the enterprise has filed a complete application for a standard patent and it is aware of
infringement activities it may wish to file a divisional application for an innovation patent.
This process is applied when petty patents were available and it has been suggested that the
same can now be done with innovation patents.

4.6 COPYRIGHT AND INFRINGEMENT

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Infringement of copyright must relate to a protected work. There must be some connection
between the original work and the alleged infringement work. In relation to literary,
dramatic, musical or artistic works an infringement will be established if there is a
substantial part of the copyright work reproduced and considering comparing the alleged
infringing work against the copyright work. What also needs to be addressed is the issue of
quality rather than quantity. If a person authorises another person to perform an infringing
activity then that first person will be also liable for infringement.119

If the infringement is shown to be innocent then the copyright owner cannot seek damages
although it may be entitled to an order for account of profits. On the other hand, if an
enterprise can establish a flagrant infringement of its copyright then it may be able to obtain
an order for ‘additional damages’. For these reasons the use of appropriate copyright notice
and letters of demand are an important step in enforcing copyright.

4.6.1 DEFENCES

It is worth noting that not all copying of a substantial part of a copyright work will be
unlawful. The Copyright Act 1957 sets out a range of defences to an action for infringement
of copyright including research and study or criticism or review. In respect of computer
programs, the copyright will not be infringed if a person:

• makes back-up copies of the software;
• develops inter-operable products by exercising one of the copyrights;
• copies to correct errors that prevent the original software from operating; or
• exercises those copyrights in the course of security testing computer systems of

which the original software is a part: see s. 43 (1) (ab) of the Indian Copyright Act,
1957.

This criterion has been laid down in John Richardson v.Flanders [1993] FSR 497.

4.6.2 LIMITATION PERIOD

The Copyright Act provides that the limitation period is six years from the date on which the
infringement took place.

4.6.3 GROUNDLESS THREATS

A person who has received a groundless threat of infringement of copyright can obtain a
declaration, injunction or recover damages. This is provided under section 60 of the
Copyright Act, 1957.

4.6.4 CUSTOMS SEIZURES

119. W.R. Cornish and David Llewelyn, Intellectual Property: Patents, Copyrights,
Trademarks and Allied Rights, Sweet & Maxwell; 5Rev Ed edition (4 Sep 2003)

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It is open to the enterprise to request Customs to seize any articles which may constitute
infringement of the enterprise’s copyright, as provided under section 55 and 58 of the
Copyright Act. The customs has the power to seize and destroy infringing articles.

4.7 TRADEMARKS AND INFRINGEMENT

The survey of Indian patent attorneys undertaken by us shows that trademarks is the most
common form of IP litigated in Indian courts. This is probably due to there being less risk of
a trademark being removed from the register than say a patent because the criteria for
registration is less problematic. It is easier for the human mind to determine whether
something is distinguishable than whether an invention is novel. An action for trademark
infringement will also be coupled with claims that the ‘infringer’ has committed the tort of
passing off and/or breached provisions of the Competition Act.

Infringement will occur if a person uses, as a trademark, a sign that is substantially identical
with or deceptively similar to, the registered trademark in relation to the designated goods
or services. Infringement will also occur if the use is substantially identical with or
deceptively similar to a trademark that is used in respect of goods or services that are
closely related to, or are of the same description as, the designated goods and services
unless the defendant can establish that such use is not likely to deceive or cause confusion.
Ancillary infringing acts include applying a trademark to damaged goods or altering or
obliterating a mark that has been applied to designated good. The essential feature of a
claim for infringement is that a comparison must be made of the marks. This is both visual
and oral. The courts take account of what a reasonable person in the relevant market would
think.

A person will not be infringing a registered trademark if, amongst other things:

• it uses the person’s name in good faith;
• the use of a sign is in good faith and for the purpose of indicating quality, quantity,

purpose, value or geographic region of the goods or services;
• the use is for comparative advertising, although there are obvious risks in

undertaking a comparative advertising campaign particularly in respect of liability
under the Competition Act;
• parallel importation (where the trademark has been applied with the authorisation
of the owner of the registered trademark );

The use by another person of the mark must be ‘as a trademark’. If the mark does not
inherently distinguish the designated goods or services then there is a risk that the infringer
may claim that its use is not ‘as a trademark’ and that it is merely describing the goods or
services for which the mark is applied. This is perhaps one of the most common forms of
rebuttal in any action to enforce a registered trademark.

4.7.1 WHEN TO COMMENCE AN ACTION

An action can be commenced while the application is on foot but it is not possible to obtain
an order from a court until registration is granted. For this reason it is common for a party to

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seek to expedite the examination of a trademark where there is suspected infringing
activity.

4.7.2 GROUNDLESS THREATS

The person may seek orders in relation to groundless threats of infringement of trademarks

4.7.3 LIMITATION PERIOD

The Trade Marks Act does not set out an express provision dealing with limitation periods
for commencement of infringement actions.

4.8 PLANT VARIETIES AND INFRINGEMENT

Once an application under Plant Varieties Act (PVA) is accepted, the applicant has a
provisional period of protection until the application is disposed of or the applicant is given
written notice that protection will cease to apply. This has been provided under section 21
and 23 of the Plant Varieties Act. Infringement will occur if there has been a performance of
any of the plant breeder’s rights without authorisation.

4.8.1 DEFENCES

It is a defence to an action for infringement of PVA if the court is satisfied that the infringer
was not aware of, and had no reasonable grounds for suspecting, the existence of PVA.

4.8.2 GROUNDLESS THREATS

There is no provision in the Plant Varieties Act for groundless threats of an infringement
action.

4.9 REGISTERED DESIGN AND INFRINGEMENT

A registered design will be infringed if the design has been applied or an obvious fraudulent
imitation of it has been made. Additionally, infringement will occur if an article bearing the
design has been sold or imported for the purposes of trade.

4.9.1 DEFENCES

A defendant facing an action for infringement of a registered design must rely on
establishing the difference between its design and that of the registered design.

4.10 CIRCUIT LAYOUTS AND INFRINGEMENT

It is an infringement of rights if the circuit layout has been copied. There must be some
causal connection between the alleged infringing layout and the protected circuit layout.
Deconstruction of the layout will constitute infringement although independent creation of
it will not.

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4.10.1 DEFENCES

The following will constitute defence to any action for infringement:

• innocent commercial exploitation. This will be established if the alleged infringer did
not know that the circuit was authorised;

• copying for private use, although such copying must not prejudice the interests of
the owner of the EL rights;

• research and teaching;
• reverse-engineering for the purposes of evaluation and analysis.

4.10.2 EXHAUSTION OF RIGHTS

The Circuit Layouts Act provides that the rights are exhausted if the purchaser of the circuit
layout exploits the copy of the engine’s greater circuit in India.

4.11 CONFIDENTIAL INFORMATION and INFRINGEMENT

An enterprise can restrain a third person who received the information from the initial
recipient if it can be shown that the third party was aware that the information was of a
confidential nature. The greatest practical difficulty with enforcement of confidential
information is that it is difficult to get the horse back in the yard. Once the information is
released the damage is almost irreparable. In many circumstances damages will not be
adequate to compensate the enterprise for the loss of competitive advantage that the
confidential information would otherwise give.

4.11.1 HOW TO BRING AN ACTION FOR CONFIDENTIAL INFORMATION?

A right of action will lie for breach or infringement of confidential information where in an
enterprise can prove that the other party has used confidential information, directly or
indirectly obtained from it and without its consent.

“Four requirements have to be fulfilled:

• The claimant must identify clearly the information which is alleged to be
confidential.

• The information itself must have “the necessary quality of confidence about it”
• That the information must have been imparted in circumstances importing an

obligation of confidence and
• There must have been an unauthorised use of that information to the detriment of

the party communicating it.”120

4.11.2 DETERMINATION OF INFORMATION

120 How to bring an action for Confidential Information? 17th August 2007 available at
<http://www.lawdit.co.uk/reading_room/room/view_article.asp?name=../articles/Bringing%20an%20actio
n%20for%20breach%20of%20Confidential%20Information.htm>

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Whether the information has the necessary quality of being confidential has to be
determined in all the circumstances. It must not be something which is a public property
and public knowledge, but it is perfectly possible to have a confidential document, be it a
formula, a plan, or sketch or something of that kind, which is the result of work done by the
maker on materials which may be available for the use of anybody.
In an English Case: Fraser v Thames Television [1983] 2 All E.R. 101 it was held that an idea
for something yet to be elaborated may attract legal protection as confidential information.
To attract such protection the information may be simplistic but must have a sufficient
degree of certainty, with a significant degree of originality and the idea must be clearly
identifiable.

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