Rario's Cricket NFT Case Against MPL & Striker: A Comprehensive Review

The advancement of blockchain technology, Artificial Intelligence (AI), and virtual digital assets has led to growing apprehension about the multitude of legal and ethical dilemmas that could arise from their development and their potential impact on the legal rights of individuals.

The Delhi High Court recently deliberated on the relationship between generative AI and personality rights in Digital Collectibles Pte. Ltd. and Ors. vs Galactus Funware Technology Private Limited and Anr. [CS (COMM) 108/2023]. In this case, the court declined to issue a temporary injunction against the gaming platforms Mobile Premier League (MPL) & Striker for using the name and likeness of certain cricketers to create Non-Fungible Token (NFT) – enabled “Digital Player Cards”.  

Non-Fungible Tokens under Copyright Law

NFTs are distinct digital assets that leverage blockchain technology to validate ownership and are frequently utilised for trading digital art and collectables. Nevertheless, an ongoing discussion revolves around the intellectual property rights tied to NFTs and the question of whether acquiring an NFT bestows copyright ownership.

On the other hand, Online Fantasy Sports (OFS) involve participants creating virtual teams of real-life athletes and competing based on their performance in real sports events. The users pay an entry fee to join and use their skills to participate in online events or leagues. Under prevailing copyright laws, purchasing an NFT does not automatically convey the legal right to claim copyright in the artwork unless a separate commercial agreement is established to that effect. In the instant matter, an OFS platform created NFT-enabled “Digital Player Cards” (DPCs) featuring the names and likenesses of certain cricketers. These digital assets could be owned and traded by users on the blockchain.

Case Overview

Digital Collectibles Pte. Ltd. (Plaintiff No. 1 here) owns and operates ‘Rario’, a digital collectables platform based on NFTs. The platform facilitates selling, purchasing, and trading officially licensed DPCs featuring cricketers. As well-known cricketers, Plaintiff Nos. 2 to 6 granted Plaintiff No. 1 an exclusive license to utilise their names and photographs on the Rario platform.

These DPCs contain names, photographs, and other personality traits of cricketers which are bought, sold, and traded for actual currency on Rario, utilising Rario’s private blockchain. The price of each DPC is determined by the demand and supply for the specific DPC, which is, in turn, influenced by the popularity and renown of the respective cricketers.

Galactus Funware Technology Private Limited (Defendant No.1) is the proprietor and operator of the online fantasy sports platform called MPL, while Defendant No. 2 is the proprietor and operator of the mobile application ‘Striker’, listed on the MPL. Like Rario, Striker users can purchase, sell, and trade DPCs and Striker also utilises NFT technology to authenticate the DPCs on its platform.

In February 2023, a suit was filed before the Delhi High Court against the defendants for using players’ names, images and other attributes (including those of Plaintiff Nos. 2 to 6) on their platforms without obtaining the players’ authorisation or license.

Right to Publicity vis-à-vis Freedom of Speech and Expression

The plaintiffs asserted that the value of the DPCs, considered digital art collectables, is primarily derived from and dependent on the names, likenesses, and other elements associated with the cricketers whose DPCs are offered on the Striker platform. Moreover, they relied on precedents set forth by the Hon’ble High Court of Delhi in D.M. Entertainment Pvt Ltd v Baby Gift House & Ors [MANU/DE/2043/2010] and Titan Industries v M/s Ram Kumar Jewellers [(2012) 50 PTC 486], to contend that the Striker DPCs are an unauthorised endorsement and violated the plaintiffs’ publicity rights.

In reply to the plaintiffs’ contention, the court remarked that while Indian courts have acknowledged the existence of celebrity personality rights, these rights are not absolute and must be weighed within the context of the common law principle of “passing off” and in accordance with the right to freedom of expression enshrined in Article 19(1)(a) of the Indian Constitution.

The Single Judge Bench of Justice Amit Bansal opined that the right to publicity was subordinate to the freedom of speech and expression guaranteed under the Constitution and noted that the “Right to publicity”, i.e., the right to control the commercial use of one’s identity and personality, is not absolute or unrestricted.

The celebrity’s right to publicity is only violated when using their name or image is intended to mislead the public into believing that they are endorsing and associated with the product in question. In such instances, it can be said that the celebrity’s goodwill and reputation have been misused to promote a product or service.

Use of Artwork with Creative Elements

The court highlighted that the DPCs of the defendants include artwork of the players, not photographs, and this artwork was determined to have creative elements that set them apart from the actual images of the players since the defendants have shown their expression through these creations rather than utilising celebrities’ likenesses directly. These innovative features and creative caricatures were held to be protected under Article 19(1)(a) of the Constitution.

Players’ Information Available in Public Domain

The defendants expressed that the content used for DPCs on the Striker platform is in the public domain, which served the purpose of identifying the cricketers on the platform; thus, it is beyond the scope of those cricketers’ personality rights. It was further stated that the platform is categorised as an OFS game, which does not offer the ability to purchase and “own” cricket moments (a key feature of the plaintiffs’ licensed DPCs). The defendants asserted that their DPCs could not be traded or used outside the Striker platform as they are inherently linked to the user experience and format of the Striker platform and highlighted the usage of players’ names and other information in a similar manner is common in other OFS games, demonstrating an established industry practice.

The defendants also cited the decision of U.S. Courts in CBC Distrib. & Mktg. v Major League Baseball Advanced [505 F. 3d 959] and Daniels v Fan Duel Inc [109 N.E. 3d 390], to support their argument that if the information and facts regarding certain celebrities which the defendants use are already publicly available, there can be no valid claim for infringement of publicity rights.

The court noted that OFS operators use publicly available player names and images to identify players. Thus, the court ruled that no one can own information in the public domain and such information can’t be monopolised or licensed. Since public domain facts cannot be monopolised, a third party’s use or publication for commercial gain cannot afford the plaintiffs a cause of action. With respect to the remedies available for an aggrieved celebrity, the court only cited defamation as a resort. 

Accordingly, the Hon’ble Court held that the plaintiffs failed to make out a case for the grant of an interim injunction[1] and effectively gave the go-ahead to Striker as it is not a ‘trading platform’ like Rario per se and does not mislead customers regarding any affiliation with or endorsement and does not violate any right of Digital Collectibles. Based on this, the matter has been listed for completion of pleadings on July 10, 2023.

Order of Single Judge Bench Challenged

Indian cricketers, including Mohammed Siraj, Harshal Patel, and Rario, have challenged the above interim order of the Single Judge Bench through appeals filed before the Division Bench of the Delhi High Court. The appellants lay emphasis on the players’ absolute rights over their persona and argued that there is a misunderstanding as to when fair use ends and confidentiality begins. The Bench has instructed the parties to submit written statements within a week and scheduled the next hearing on July 10, 2023.

Analysis

In the abovementioned case, the Delhi High Court has recognised that the test for determining the infringement of the right to publicity aligns with the principles and standards of the tort of passing off. It is now clear that the right to publicity is violated when a third party employs a celebrity’s information, trait, or attribute in a manner that is likely to cause confusion.

The recent appeal against the order of the Single Judge Bench is a testament to the brunt faced by celebrities when Online Fantasy Sports platforms utilise their images to entice audiences. The position of the Hon’ble Court is yet to be determined; however, the mere incidental or transformative use of a celebrity’s name, image, etc. in connection with a product or service cannot be said to be an infringement of the right to publicity. This order has provided precision to Indian jurisprudence on the right to publicity while also emphasising the need to strike a balance between justly enforcing the right to publicity and upholding the constitutional right to freedom of speech and expression.

Additionally, the court’s decision has the potential to influence the approach of Indian courts in addressing the incorporation of emerging and advanced technologies in our everyday lives. As this field of law is still developing, it remains to be seen whether the Indian judiciary will embrace this trend of engaging with novel concepts.

References:

[1] I.A. 3960/2023

Image Credits:

Photo by Aksonov: https://www.canva.com/photos/MAEJTBLx3xI-cricket-on-laptop-live-broadcast/

The court noted that OFS operators use publicly available player names and images to identify players. Thus, the court ruled that no one can own information in the public domain and such information can’t be monopolised or licensed. Since public domain facts cannot be monopolised, a third party’s use or publication for commercial gain cannot afford the plaintiffs a cause of action. With respect to the remedies available for an aggrieved celebrity, the court only cited defamation as a resort. 

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Authors’ Right to Receive Royalty for Underlying Works Recognised at Last

  • May 29, 2023
  • Mathews V C
  • Muskaan Sawhney

The Bombay High Court recently issued a ruling stating that FM radio stations are required to compensate composers and lyricists for the copyrighted music they broadcast[1]. Through this judgment, the court clarified that after the Copyright Act, 1957 was amended in 2012, making a sound recording available to the public will mean using the musical and literary works that form its foundation.

The longstanding dispute between broadcasters and the authors of underlying works has reached a fair and equitable conclusion, with the latter celebrating the recognition of their rights. In this article, we look at the intricacies involved in the case and analyse the reasoning provided by the court in arriving at its decision.

Case Overview

The Indian Performing Rights Society (IPRS), a copyright society, and Music Broadcast Private Limited, a company which owns and operates the radio station “Radio City”, entered into a licence agreement in the year 2001 to employ IPRS’s library of literary and musical works for FM radio broadcast. Akin to this, Rajasthan Patrika Pvt. Ltd., which operates the radio station “Radio Tadka”, finalised a radio broadcasting deal with the IPRS in 2006. Subsequently, the Copyright Board of India set a mandatory licence price for radio broadcasting under Section 31(1)(b) of the Act. IPAB set the royalties rate while making decisions concerning applications submitted under Section 31D in 2010. The defendant companies and the IPRS were earlier involved in a legal battle over the rights of authors of original works in case the public becomes aware of sound recordings that consist of these original works. In Music Broadcast Pvt. Ltd. v. IPRS[2], it was held that authors of the original works or the underlying literary and musical works that were included in sound recordings did not have the authority to impede the rights of the owners of those sound recordings to share them with the public through radio broadcast, etc.

The issues raised in the matter include: –

  • Whether the defendant companies are required to provide royalties to IPRS for transmitting musical works to the general public through their FM radio broadcast channels.
  • Whether the modifications adopted in the Copyright Act, which took effect on June 21, 2012, have any bearing on the rights of the creators of original works when those original works are included in sound recordings that are shared with the public.

In Entertainment Network India Ltd. v. Phonographic Performance Limited India and Anr[3], and related matters, the Delhi High Court clarified that the IPAB order remains in effect even while an appeal is pending. The court held that no compensation for the underlying works had been provided since the IPAB order was issued and stated that the respondent is entitled to use any available remedies if the IPAB order is not followed. Afterwards, on October 6, 2021, the court released a notice in the public domain seeking feedback from parties interested in fixing royalty rates concerning the underlying works. In a request for an interim injunction, IPRS alleged that the defendants were broadcasting songs from its catalogue without permission. According to IPRS, the Copyright Act underwent significant revisions addressing the rights of the authors of underlying works after 2012.

Contentions of Parties

The IPRS made thorough arguments to convince the court that the 2012 amendment to the Copyright Act, which took effect on June 21, 2012, had fundamentally altered the Act’s structure and supported the claims made in the lawsuits and the requests for temporary relief. According to the argument, the IPRS, which is seeking interim relief in the current applications, cannot be hindered by the legal position established by the Supreme Court in its 1977 decision in the case of IPRS vs. Eastern Indian Motion Pictures Association and others[4], which the Supreme Court and several High Courts later upheld.

The IPRS drew the Court’s attention to the amendments to Sections 17, 18 and 19 of the Copyright Act. Furthermore, the revisions carried a by-product of overturning the legal precedent established by the unaltered Copyright Act, as determined by the Supreme Court in the case of IPRS vs. Eastern Indian Motion Pictures Association and others and subsequent decisions and that the provisions of the unamended Copyright Act had been incorrectly perused by the Supreme Court and erred against the rights of the authors of such underlying works.

On the other hand, the defendant companies asserted that while the Copyright Act has clearly undergone changes since 2012, most of the changes are merely clarifications. It was argued that even if it were true that the revisions were implemented to extend the rights of authors of original works, the objective that the IPRS professes to support had not been achieved. Moreover, the defendants contended that since the 2012 amendment was only clarifying in nature and that since Sections 13 and 14 had not been changed, the adjustment to the other provisions could not have conferred any new substantive rights.

The Verdict

Accepting the contentions of the IPRS, the court stated that the 2012 amendment does “have the effect of creating a substantive right in favour of authors of underlying literary and musical works”. It was pointed out that though Sections 13 and 14 weren’t amended when they were read in conjunction with the amended Sections 17, 18 and 19, it can be seen that there is a “change in position of law brought about in favour of such authors of works”.

In its joint order, the court also concurred with IPRS’s claims that, despite payments made by the broadcasters to the owners of the sound recordings, the broadcast of music by FM radio broadcasters necessitated the payment of royalties in respect of the utilisation of literary and musical works underpinning the sound recordings. In response to the defendants’ claim that sharing the sound recording with the public violates their exclusive right under Section 14(e)(iii) and cannot be interpreted as using the underlying works; the court ruled that sharing the sound recording with the public uses the underlying works because they are integral to the sound recording.

The court held that even though Section 14(e)(iii) does confer an exclusive right upon the defendants to communicate to the public, such exclusive rights are subject to the provisions of the Copyright Act, and on a joint reading of Sections 13(1)(a), Section 13(4), the proviso to Sections 17, third and fourth proviso to Sections 18, and Sections 19(9) and (10) it was interpreted that the exclusive right to communicate sound recordings to the public is dependent on the author’s right to collect royalties.

The court declined to agree that the right to earn royalties would be eliminated because the underlying works are included in the sound recordings because such an interpretation would eliminate the entitlement provided to the authors of the underlying work.

The Bombay High Court concluded that the amendments made to the Copyright Act, 1957 in 2012, which created a substantive right in favour of authors of the underlying literary and musical work, fundamentally altered the legal framework concerning ownership of authors and composers who create lyrics and musical compositions. The court ruled that IPRS is entitled to royalties for the use of literary and musical works included in sound recordings or motion pictures. The court has categorically determined that each time a sound recording is shared with the public through radio stations, it constitutes the utilisation of the underlying literary and musical works for which the authors are entitled to royalties. As a result, the authors of these literary and musical works are qualified to request royalties on each occasion that these sound recordings are shared with the public through radio stations.

Therefore, when a synchronised product (cinematographic film or sound recording) is made publicly available, the creators of those works are entitled to royalties, except for situations when a cinematograph film is shown in a theatre. The defendants have been granted six weeks to comply with the court’s directive and pay the royalties to IPRS in accordance with the order dated December 31, 2020, passed by the former Intellectual Property Appellate Board or else temporary injunctions prohibiting the broadcast of music would take effect.

Outcome

In the Indian copyright system, the problem of royalties faced by creators of the underlying work has been extensively discussed and is the subject of several litigations. There have, however, been undercurrents of a modern interpretation within these orders that held otherwise, disregarding the unanimous nature of these opinions of the law prior to the 2012 revision. The order, as originally intended by the amendment, expressly recognises the rights of the authors of the underlying works. The order underlines a huge incentive to the authors and has received a warm reception from the community. However, the order’s practical ramifications are yet to be determined. The order may be overturned if the appellate authority believes that the IPAB exceeded its power by setting the royalty rates for the underlying work while it is currently pending review.

References:

[1] Indian Performing Right Society Ltd. v. Rajasthan Patrika Pvt. Ltd. (IA No. 9452 of 2022) and Indian Performing Rights Society Ltd. v. Music Broadcast Ltd. (IA No. 1213 of 2022)

[2]Suit No.2401 of 2006

[3]C.O.(COMM.IPD-CR) 3/2021

[4]1977 AIR 1443

Image Credits:

Photo by dotshock: https://www.canva.com/photos/MAAXiQsGTn8-radio-station-microphone/

The Bombay High Court concluded that the amendments made to the Copyright Act, 1957 in 2012, which created a substantive right in favour of authors of the underlying literary and musical work, fundamentally altered the legal framework concerning ownership of authors and composers who create lyrics and musical compositions. The court ruled that IPRS is entitled to royalties for the use of literary and musical works included in sound recordings or motion pictures. The court has categorically determined that each time a sound recording is shared with the public through radio stations, it constitutes the utilisation of the underlying literary and musical works for which the authors are entitled to royalties. As a result, the authors of these literary and musical works are qualified to request royalties on each occasion that these sound recordings are shared with the public through radio stations.

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Facets of Conceptual Similarity and Semantic Similarity in Trademark Infringement Cases

  • April 13, 2023
  • Shreya Chaddha
  • Shreyali Yadav

In this article, we aim to anatomize the facets of conceptual similarity and semantic similarity vide the many judgments that have envisaged their principles and other cognate principles that arise when the question of conceptual similarity is effectuated between rival trademarks.

Introduction

The idea that rival marks should be assessed as a whole rather than in terms of their individual components is a well-established and widely accepted tenet of trademark law. Confusion, likelihood, similarity, etc. – these terms are allied to the concept of trademarks. An infringement action calls for a comparison of trademarks based on various factors. One crucial factor, and very often not considered part of strategies, is “conceptual similarity”. A test to the latter’s effect, namely the conceptual similarity test, compares competing marks based on the underlying idea or concept that the marks imply or portray. To portray instances, what has been the idea behind the inception of the impugned mark? Whether solely a word mark has been used or a logo/device has also been attached to the word mark? Like many other facets of trademark law that have been established through judicial acumen, the test of conceptual similarity is also one such. 

Similarity vis-à-vis trademarks: Conceptual Similarity and Semantic Similarity

The concept of similarity is extremely crucial to the edifice of trademark law. As per Section 2(h) of the Trademarks Act, 1999, the marks will be deemed to be deceptively similar if the resemblance is likely to deceive or cause confusion. The said section implies that the resemblance should be such that it produces a hazy understanding of the rival mark being that of the victim mark. While certain marks are visually and/or phonetically similar, some marks do not fall in the latter category; however, they are still considered infringement. Here is where conceptual similarity steps in.

The conceptual similarity test compares competing marks based on the underlying idea or concept they indicate or project. The main issue in such a test is whether or not the average man might be misled or confused by two conceptually similar marks because of their similarity. This concept can be better explained with the help of the Delhi High Court judgment in the case of Shree Nath Heritage Liquor Pvt. Ltd. v. Allied Blender & Distillers Pvt. Ltd[1].  The marks in the present case were “OFFICER’S CHOICE” and “COLLECTOR’S CHOICE/OFFICER’S SPECIAL”. While a prima facie view herein would indicate a lack of phonetic similarity, the conceptual similarity test brings in a pivotal and exciting aspect to consider the words’ semantic synonymity. Citing the decision in the case of Corn Products v. Shangrila Foods[2] (wherein the marks “GLUVITA” and “GLUCOVITA” were considered), the semantic similarity was relied upon to decide on the basis for infringement beyond the normal binds of visual or phonetic similarity.

The above-mentioned case is a pioneer in the establishment of principles pertaining to semantic similarity. It has, for instance, referred to various case studies, for instance, the “Distinctive Brand Cues and Memory for Product Consumption Experiences[3]“, wherein one line is of utmost relevance to this article – that the conceptual background behind the brand name is what triggers the recollection of memory in a consumer, and not the brand name in itself. Further, the word “Collector” can be seen as a hyponym of the word “Officer”, in common parlance, both signifying a “Person holding an office of authority”.

Thus, since both trademarks in the current case are used in the same context for one single product, that is whisky, when a consumer is forced to decide on a purchase and is presented with the product of the appellant with the mark “Collector’s Choice”, the word “Collector” will cause him to think of the cue “Person holding an office of authority,” which is related to the word “Officer”. This signal may induce the consumer to mistakenly believe that the appellant’s whisky is the respondent’s or cause a false recollection that may confuse consumers. Thus, this concept of semantic synonymy is highly relevant to trademark jurisprudence and can be subdivided as follows.

Expanding horizons of synonymy

The general understanding of synonymy is the phenomenon of two or more different linguistic forms with the same meaning. To this extent, synonymy can further be categorized. For example, synonyms of different degrees signify words with the same (although extended) meanings, but the degree of effectuation differs. For instance, fury, rage, and anger are synonyms with the same extended meaning of emotional excitement induced by intense displeasure. In contrast, anger is used commonly without a substantial degree of intensity, rage focuses on a loss of self-control, and fury empathizes with a rage so violent that it may approach madness. Similarly, are concepts of synonyms with different emotions, styles, collocations, etc.

What becomes vital in each case, thus, is to establish the degree of synonymy with respect to other factors of similarity, which has been highlighted in the recent case of Metis Learning Solutions Private Limited v. Flipkart India Private Limited and Ors.[4] The court held that conceptual similarity could not be judged in isolation, and the overall phonetic, visual or structural similarity is also required to be seen holistically.

In Make My Trip (India) Private Ltd v. Make My Travel (India) Private Limited[5], the Court had to examine any deceptive similarity between the marks MakeMyTrip and MakeMyTravel. From a prima facie view, one part of the mark “MAKEMY” is identical, visually and phonetically, and hence, warrants no application of conceptual similarity. The test comes into the picture by comparing the rival marks’ latter half – “TRIP” and “TRAVEL”. While these two words are neither identical visually nor phonetically, they are synonyms and convey a similar idea with respect to the services they provide. Thus, the marks could be considered deceptively similar for establishing an infringement action.

Hyponymy & Hypernymy: An extended branch of conceptual similarity

Alongside synonymy are two other important concepts we must look at – hyponyms and hypernyms. As per the Oxford English Dictionary, a Hypernym is a “word with a broad meaning constituting a category into which words with more specific meanings fall; a subordinate”. An example of this effect would be that ‘colour’ is a hypernym of ‘blue’, ‘dog’ is a hypernym of the breed ‘dachshund’, etc. On the contrary, a Hyponym is a “word of more specific meaning than a general or super-ordinate term applicable to it”; for example, ‘Spoon’ is a hyponym for ‘cutlery’, etc. Having a basic conceptual understanding of Hypernyms and Hyponyms, we now look at their relevance in trademark infringement actions.

What hyponyms and hypernyms do is create a sense of inclusion. Sharing a hyponym in the form of a conceptual background would make the consumer think of the same thing, making it harder for him to remember the name of his favoured brand. Similarly, when two or more brand names are similar, for example, men’s perfume brands being called rugged and macho, while the meaning of each of these terms may vary according to the situation, in the context of men’s perfumes, they all refer to masculinity, and hence, are very likely to confuse the relevant category of consumers.

Conclusion

Time and again, courts have taken the lead and strived to bring into the picture the diverse ways trademark infringement can occur. Nevertheless, a restricted and cautious approach must be followed in applying the concepts of conceptual similarity (including hypernyms and hyponyms), semantic similarity and synonymy. Best explained using an example, let us consider the men’s perfume example. Would trademark protection of synonyms cover all equivalent words, preventing the naming of any masculine fragrances after any phrase synonymous with “Tough”? Such situations may lead to malpractices such as monopoly, squatting, etc. Thus, to protect words that share a sense relation, a restrictive application must be made, preserving only those sense relations of the term where the context in which they are applied to the brand name is the same, causing identical concepts to be conveyed to consumers.

References:

[1] Shree Nath Heritage Liquor Pvt. Ltd. v. Allied Blender & Distillers Pvt. Ltd, FAO (OS) 368 and 493/2014.

[2] Corn Products Refining Co. v. Shangrila Food Products Ltd., AIR 1960 SC 142.

[3] International Journal of Research in Marketing [22 (2005) 27-44].

[4] Metis Learning Solutions Private Limited v. Flipkart India Private Limited and Ors., CS (COMM) 393/2022 and Crl. M. A. 12694/2022.

[5] Make My Trip (India) Private Ltd v. Make My Travel (India) Private Limited, 2019 (80) PTC 491 (Del).

Image Credits:

Photo by Robert Anasch on Unsplash

In Make My Trip (India) Private Ltd v. Make My Travel (India) Private Limited[5], the Court had to examine any deceptive similarity between the marks MakeMyTrip and MakeMyTravel. From a prima facie view, one part of the mark “MAKEMY” is identical, visually and phonetically, and hence, warrants no application of conceptual similarity. The test comes into the picture by comparing the rival marks’ latter half – “TRIP” and “TRAVEL”. While these two words are neither identical visually nor phonetically, they are synonyms and convey a similar idea with respect to the services they provide. Thus, the marks could be considered deceptively similar for establishing an infringement action.

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Application of Prosecution History Estoppel in Trademark Infringement Proceedings

  • March 17, 2023
  • Drishti Kardam
  • Indiradevi Kollipara

The doctrine of prosecution history estoppel, which was initially prevalent in determining the infringement of patents, also has its uses in trademark infringement proceedings. It prevents individuals from claiming the advantages associated with a right waived on a previous occasion.

When applied to trademarks, the doctrine dissuades applicants from misusing the opportunity bestowed upon them to amend their claims of infringement by relying on the submissions made to the Registry while making the trademark application or during the examination. In this context, it is relevant to understand the estoppel concept, defined under Section 115 of the Indian Evidence Act, 1872. This section states as follows: –

“When one person has, by his declaration, act or omission, intentionally caused or permitted another person to believe a thing to be true and to act upon such belief, neither he nor his representative shall be allowed, in any suit or proceeding between himself and such person or his representative, to deny the truth of that thing.”

Although judges make infrequent use of the doctrine in disposing of trademark infringement cases, its significance in this domain cannot be understated. For instance, this doctrine was applied by the Delhi High Court in Mankind Pharma Ltd. v. Chandra Mani Tiwari & Anr.[1] Back when the plaintiff had applied for the registration of the mark ‘ATORVAKIND’, the examiner found that it was similar to the marks ‘ATORKIND’ and ‘ATORKIND-F’. In its reply to the examination report, the plaintiff contended that its mark was different from the cited trademarks. The defence proved that the plaintiff’s reply took the publici juris defence for the term ‘KIND’. Subsequently, the court held that the defendant’s use of the mark ‘MERCYKIND’ did not constitute trademark infringement, and accordingly, the plaintiff’s plea for injunction was dismissed.

Here are some instances wherein the doctrine of prosecution history estoppel can be applied, and prosecution history (I.e., history of the proceedings right from application filing to trademark registration) can be relied upon in trademark infringement cases: –

Trademark includes a generic or descriptive term

If an application is made for the registration of a trademark with a generic or descriptive term, subsequently, the claimant cannot assert in the infringement proceedings that the mark used by the defendant is generic or descriptive. This principle also extends to determining the scope of goods and services. If the claimant in the prosecution stage claims the difference in goods or services compared to another mark, then the claimant can be said to have misclassified the goods at the prosecution stage. However, if the claimant has stated that there exists a difference in goods or services amongst rival companies, then infringement suits will backfire against the claimant.

Failure to make disclosures

Claimants must disclose statements given in the prosecution case that are potentially contradictory to the infringement claims posed in the infringement proceedings. And failure to make said disclosure could lead to the claimant’s incrimination. In some cases, the failure of the defendant to challenge the claimant’s trademarks can lead to prosecution history omission, just as in the Dish TV[2] case.

One can conclude that the doctrine of prosecution history estoppel calls for cautious handling of arguments and submissions at every stage of the prosecution of trademark applications. The arguments should be made considering their implications in the future as it unlocks an ambit for approbation and reprobation, which in most cases is used against the proprietor of the IP.

References:

[1] 2018 SCC OnLine Del 9678.

[2] Dish TV India Ltd. v. Prasar Bharti, 2019 SCC OnLine Del 9141.

Image Credits:

Photo by Clarisse Meyer: https://unsplash.com/photos/jKU2NneZAbI?utm_source=unsplash&utm_medium=referral&utm_content=creditCopyText

The doctrine calls for cautious handling of arguments and submissions at every stage of the prosecution of trademark applications. The arguments should be made considering their implications in the future as it unlocks an ambit for approbation and reprobation, which in most cases is used against the proprietor of the IP.

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Registration of GUI as Designs: Existing Provisions and Challenges

  • January 13, 2023
  • Drishti Kardam

In this article, an attempt is being made to highlight how GUIs can be protected and to ascertain the challenges faced by applicants in filing design applications for the registration of GUIs.

Introduction

A Graphic User Interface (GUI) which allows users to interact with electronic devices or machines, is widely used in the present digital age. The term was coined in the 1970s to distinguish graphical interfaces from text-based ones, such as command line interfaces (CLI), etc. Apple’s GUI-based operating system – Macintosh, Microsoft’s Windows, Mobile Touch Screens, and other 3D interfaces (Eg. Augmented Reality) are all examples of GUIs.

Protection of GUI: A Look at Locarno Classification and Designs (Amendment) Rules, 2021

Just as trademarks are classified into various classes of goods and services provided for in the internationally accepted NICE classification, Designs also have a classification of articles to which a design can be applied, known as the Locarno Classification.

The Locarno Classification, developed under the Locarno Agreement (1968), is an international classification used for registering industrial designs. India became the 57th member to be a signatory to the Locarno agreement in 2019. The changes were incorporated through the Designs (Amendment) Rules, 2021, thereby bringing the classification of industrial designs at par with the rest of the world as opposed to the previous national classification.

Subsequently, on 25th January 2021, the Ministry of Commerce and Industry notified the Designs (Amendment) Rules, 2021, which substituted Rule 10 of the Design Rules 2001, and incorporated the current edition of the Locarno Classification, which specifically created Class 14 – Recording, telecommunication, or data processing equipment, with a subclass “Class 14-04 – Screen Displays and Icons”, and further provided for Class 32, allowing for two-dimensional graphic designs, graphic symbols, and logos, to be protected under the Designs Act, 2000, provided that these designs satisfy the essentials of an ‘Article’ and a ‘Design’ as defined in Sections 2(a) and 2(d) of the Act.

Lacunae in Legislation

As per the Designs Act, 2000, a design means “only the features of shape, configuration, pattern, ornament, or composition of lines or colours applied to any article, whether in two dimensional or three dimensional or in both forms, by any industrial process or means, whether manual, mechanical or chemical, separate, or combined, …”

Now, this is precisely where the problem arises. Even after the Locarno Classification was introduced and the Designs Rules were amended to deal with confusion and uncertainties in the classification of industrial designs, the lawmakers have failed to amend the definition of ‘Design’ and bring the Designs Act, 2000, along the same lines. Further, the Controllers make conflicting observations and the interpretations provided by them seem to lack uniformity.

A GUI should be protected since its intrinsic purpose is to enhance the visual appeal of the program and thus build on its commercial value. The definition of a design given under the Act is limited and does not expressly provide for graphics and/or software. Due to this lacuna, the definition is open to multiple interpretations.

Practice Followed by the Indian Design Office

Before 2009, Microsoft was granted registration for some of its designs under Class 14-99, in the ‘Miscellaneous’ category. Thereafter, in the year 2014, Amazon filed a design application under no. 240305 pertaining to a “Graphic user interface for providing supplemental information of a digital work to a display screen”, which was rejected by the Design Office, on the grounds that GUIs do not qualify as designs under Section 2(d) of the Act, they lacked “consistent eye appeal” and were not physically accessible.

Over the years, several new applications for the registration of GUIs have been filed. While a few have been granted[1], most Examiners opine that the GUIs do not fall under the definition of ‘designs’ and hence, cannot be protected. Hence, applicants are wary of filing design applications for registration of GUIs due to the absence of robust precedents.

Observations made by US Courts

In Ex Parte Tayama[2], the Court made the following observations –

  1. Programmed Computer Systems would suffice to be termed as an article of manufacture.
  2. Design (GUI) is an integral part of computer programmes.

Further, the patent battle[3] between Apple and Samsung (2011 – 2018) ended with Apple being awarded $539 million for Samsung’s infringement of its initial design. Apple was all the while contending to protect its “Total User Experience”.

Various Design Patents have been granted by USTPO, such as apparatus for displaying the path of a computer program error as a sequence of hypertext documents in a computer system having display[4], device, method, and graphical user interface for adjusting content selection[5], etc.

European Union’s Position

EU also provides wide protection to designs under EU Directive 98/71/EC on Legal Protection of Designs. GUIs in the EU are generally registered under the Community Design Regulation (Council Regulation No. 6/2002/EC) but may also exist as unregistered Community Designs. The regulation, however, excludes computer programmes.

Conclusion

The current definition of a design is inadequate and does not expressly cover the aspects of graphics/GUIs. Undoubtedly, the various developments in the IT industry have made the world realize the importance of protecting graphics. However, the introducing of international classification (Locarno Classification) and bringing amendments to existing laws are not sufficient. It is imperative to establish new guidelines and provide appropriate training to the Examiners at the Design Office so that a uniform mechanism is in place to facilitate the registration of graphic symbols/GUIs.

References:

[1] Design Application Numbers 274917, 274918, 284680, 276736, 260403

[2] 24 U.S.P.Q.2d (BNA) 1614 (BPAI Apr. 2, 1992)

[3] Apple, Inc. v. Samsung Elecs. Co., 926 F. Supp. 2d 1100 (N.D. Cal. 2013) (partially affirming jury damages award).

[4] US6763497B1

[5] US10915243B2

Image Credits:

Photo by cottonbro studio: https://www.pexels.com/photo/person-using-macbook-3584994/

A GUI should be protected since its intrinsic purpose is to enhance the visual appeal of the program and thus build on its commercial value. The definition of a design given under the Act is limited and does not expressly provide for graphics and/or software. Due to this lacuna, the definition is open to multiple interpretations.

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Rooh Afza has Immense Goodwill: Delhi HC Rules in Trademark Infringement Case

  • January 9, 2023
  • Shreya Chaddha
  • Kanika Birje

The Delhi High Court gave its verdict in the trademark infringement battle between Hamdard National Foundation (India) and Sadar Laboratories Pvt. Ltd., and prohibited the latter company from using the mark “DIL AFZA” thereby protecting the trademark “ROOH AFZA”.

In a suit for trademark infringement by Hamdard National Foundation (India) against Sadar Laboratories Pvt. Ltd., the Delhi High Court held that the trademark “ROOH AFZA” possesses immense goodwill and that competitors must ensure that their marks are not similar to it. A two-judge bench, in its judgment[1] held that since the mark “ROOH AFZA” has been used for over a century, it can be considered a strong mark and, thus, restrained the Respondent from using the mark “DIL AFZA” until the suit is disposed of.

Hamdard National Foundation has filed the present appeal against the order[2] passed by a single judge bench of the Delhi High Court on 6th January 2022, rejecting an application for an interim injunction against Sadar Laboratories Pvt. Ltd. Both the marks are used with respect to sweet beverage concentrate. The Appellants claimed that the Respondents were infringing their marks “HAMDARD” and “ROOH AFZA”, and by selling these products under the mark “DIL AFZA,” they were passing off their products as those of the Appellants.

The Single Judge Bench held that the Appellants have to show that “AFZA” has a secondary meaning to claim exclusivity of their product. Therefore, the Court dismissed the application on the ground that they can claim exclusivity only for the mark “ROOH AFZA” as a whole and not just for “AFZA.”

Aggrieved by the order, the present appeal was filed by Hamdard National Foundation seeking a permanent injunction refraining the respondents from using the mark “SHARBAT DIL AFZA” or “DIL AFZA” on the ground that it is deceptively similar to the mark “ROOH AFZA.” The appellants further claimed that the use of this mark would deceive consumers and amount to passing off and also submitted that this would amount to dilution of the Appellant’s mark.

It was claimed that the marks “HAMDARD” and “ROOH AFZA” have been used for a wide range of products and constitute a well-known mark under Section 2(zg) of the Trademarks Act, 1999 owing to their widespread reputation and has therefore acquired goodwill with respect to the class of products pertaining to sweet beverage concentrates.

The Respondent submitted that by virtue of Section 29 of the Trademarks Act 1999, the allegations of infringement are not maintainable. It was submitted that the Appellants do not have an exclusive right over the word “AFZA” and that their mark has been coined by joining the terms “DIL” and “AFZA” and are not phonetically or visually similar. The Respondent submitted that there was no possibility of confusion between the two marks and every other aspect, such as the design and color scheme of “DIL AFZA” is also materially different from the Appellant’s mark. Therefore, there was no possibility of confusion between the two marks.

The Delhi High Court, after considering the arguments from both sides, stated that “AFZA” is an integral part of both “ROOH AFZA” and “DIL AFZA.” The word is neither descriptive nor normally associated with the product; hence, it is material in determining whether there is an infringement of the trademark. The Court further stated that the use of the word “AFZA” lends a certain degree of similarity, and the trade dress of both products is also similar, making the Respondent’s mark deceptively similar to that of the Appellants.

The Court reiterated that “ROOH AFZA” has been used for over a century and is entitled to protection. The mark is a source identifier with a high degree of goodwill and is susceptible to unfair competitive practices. The Court stated that prima facie, the Respondent’s mark lacks a sufficient degree of dissimilarity and hence set aside the order passed by the Delhi High court and passed an ad interim order restraining the Respondent from manufacturing and selling any product under the mark “DIL AFZA” belonging to Class 32 until the present suit is disposed of.

References:

[1] Hamdard National Foundation (India) & Anr vs Sadar Laboratories Pvt. Ltd. [Case No. FAO(OS) (COMM) 67/2022]

[2] Hamdard National Foundation (India) & Anr vs Sadar Laboratories Pvt. Limited [Case No. CS (COMM) 551/2020]

Image Credits:

Photo by Jessica Lewis: https://unsplash.com/photos/qscDBbXBGiI?utm_source=unsplash&utm_medium=referral&utm_content=creditShareLink

The Delhi High Court, after considering the arguments from both sides, stated that “AFZA” is an integral part of both “ROOH AFZA” and “DIL AFZA.” The word is neither descriptive nor normally associated with the product; hence, it is material in determining whether there is an infringement of the trademark. 

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Fluid Trademarks- A Brand’s Alter Identity

Recently in September, 2022 Amul- the most prominent dairy brand in India released a doodle, featuring the famous “Amul girl” celebrating the return of eight Cheetahs in the Kuno National Park, Madhya Pradesh. Over the years, the Brand has managed to position Amul Butter as a household staple through its alternate identity- Amul Girl. The Mascot regularly makes clever puns on the day-to-day political and policy developments while communicating their product’s “utterly butterly deliciousness”.

Fluid Trademarks- A Brand’s Alter Identity

                                                                        Fig: The recent Amul Doodle[1]

Creativity involves breaking expected patterns to look at things differently. The notion of being creative and deploying “out of the box” marketing strategies to drive brand and consumer growth is not a new concept. The ever-increasing competition and the digital revolution have forced brands to go out of their way to stay afresh and ahead of the competition while maintaining their brand identity.

Fluid Trademarks are a relatively new, up-and-coming category of marks that businesses are increasingly using to differentiate their brands and products from the competition. The Morehouse defence[2] (along with Section 43(a) of the Lanham Act)[3]  defines fluid trademarks as marks that change over time (with respect to the original or registered mark) to increase customer engagement. Albeit not explicitly defined, the defence serves as an equitable doctrine that applies when an applicant owns a prior registration “for essentially the same (or substantially similar) mark and goods or services, and for which registration has not been challenged.”

 

What are Fluid Marks?

 

Fluid Trademarks essentially serve as an expansion of the base marks, which are registered and known to the public. What makes these marks “fluid” is the interplay between different iterations of the base mark, which is characterised by the use of creative yet diverse graphical and visual components while maintaining the core features of the base mark.

Many brands frequently deploy such marks to commemorate certain special occasions or landmark happenings, enabling them to keep in touch with the ongoing trends and strengthen brand awareness by promoting interaction with the consumers.

For instance, Google’s ‘Doodle’ could be termed the quintessential fluid trademark, where different variants of the Google logo have been used over the years to mark or memorialise national/international events and festivities. Absolut Vodka is another brand that has been commercialising various iterations of its mark by launching special edition bottles to commemorate events. Some other examples of Fluid Marks being deployed by renowned brands in their marketing strategy include Nike’s ‘Just Don’t Do It’ Swoosh, BMW’s spaced logo citing ‘thanks for keeping distance’ during Covid-19, and Starbucks’ ‘Masked Mermaid’.[4]

While it is appreciable that brands are deploying newer strategies to connect with their consumers, the use of Fluid Trademarks presents some pertinent roadblocks when it comes to IP protection that these brands need to take note of.

 

Protection of Fluid Marks

 

Although there are no explicit provisions or synonymous precedents citing protection for fluid trademarks in India, registering each iteration of the base mark, which would just be deployed occasionally by these brands, would not make much business sense since it would not be cost-effective in the long run.

Section 15 of the Trademarks Act,[5] 1999 accords protection for a series of trademarks, but it is pertinent to highlight here that the section is effective only when all the variants of the base mark could be anticipated in advance,[6] which is not the case with Fluid Trademarks because of their dynamic nature.

Existing commercial identity and recognition of the base mark do accord common law protection to Fluid Marks. Still, it is pertinent for brand proprietors to consider the following essentials while endeavouring for the protection of Fluid Trademarks:

  • Protection for Unregistered Marks: Regardless of whether the brands have moved towards protecting their ‘fluid’ marks or not, the common law still subjects these marks to some sort of protection. In Proctor and Gamble v. Joy Creators,the Delhi High Court held that explicit resemblance need not be a ground to constitute an infringement of the trademark. Substantial resemblance to the primary features of the mark in question might be enough criterion to accord protection to the primary mark.
  • The Degree of Variation: The degree of variation of the base mark should be such that the mark retains its source-identifying features while simultaneously being different enough to command distinguished protection. The public should be able to identify the brand owner based on such iterations of their marks.
  • Likelihood of Confusion: Multiplicity of the base mark to an extent, such that it loses its source-identifying features, might expose the base mark to losing its distinctiveness, thereby putting the base mark at risk of not being synonymous with the proprietor anymore. Hence, the source-identifying features of the base mark should remain intact in the fluid mark to enable the public and trade to associate the fluid mark and the base mark with the proprietor.
  • Copyright Protection: Newer and fundamentally distinct iterations of the base mark may be afforded special protection under the Copyright law since the brands would be subjected to certain rights for their marks even if they are not registered. However, in establishing whether the proprietors would be entitled to a copyright on the mark, the burden of proof shall lie entirely on the proprietors themselves, and hence it would be advisable to maintain a record of the entire creative process, artwork and other resources, that went into the creation of the mark, to establish ownership.
  • Continuing Commercial Use and Identity: The base mark should be subject to constant and uninterrupted commercial use, and there should be no demonstration of abandonment of the base mark. While the base mark should be distinctive and recognised across the market, the unregistered ‘fluid mark’ should also be inherently distinctive and have acquired a secondary meaning within the public.[7]

The importance of having the base mark registered for the fluid mark to have any chance of protection was highlighted in the recent case of McGurr v. North Face Apparel Corp.[8], where the US-based artist, Futura, was denied protection for his recognisable, signature stylised atom design because the base mark, i.e., the shape of an atom, was not registered. The District Court for the Central District of California noted that legally recognising fluid trademarks “would give new meaning to federal trademark law with far-reaching consequences.” The court rather recognised copyright law as a more robust source of protection for entities facing similar situations.

 

Conclusion

 

Fluid Trademarks might be the future of brand building. They have indeed emerged as an excellent tool for businesses across the globe to engage and interact with their customers while simultaneously allowing them to keep in touch with ongoing trends. But as long as the legislature or the judiciary steps up and develops a robust set of guidelines for their protection, it would be feasible to work with an experienced IP attorney who could assist applicants to come up with a smarter plan of action for the protection of their dynamic and ‘fluid’ marks.

References:

[1] https://indianexpress.com/article/trending/trending-in-india/amuls-latest-topical-celebrates-arrival-of-big-cats-in-india-8158728/

[2]  Morehouse Manufacturing Corp. v. J. Strickland and Co., 407 F.2d 881, 160 USPQ 715, 717 (CCPA 1969) (United States).

[3] The Lanham Act, 1946, § 43(a), 15 U.S.C. §§ 1051-1141 (2006).

[4] These famous logos have been remade for the Coronavirus Age, Media Marketing, Accessible at: https://www.media-marketing.com/en/news/famous-logos-remade-coronavirus-age/

[5] The Trade Marks Act, No. 47 of 1999. India Code, § 15.

[6] Draft Manual of Trademarks, 2015. Accessible at: https://ipindia.gov.in/writereaddata/Portal/IPOGuidelinesManuals/1_32_1_tmr-draft-manual.pdf

[7] Louis Vuitton Malletier v. Dooney & Burke, Inc, 454 F.3d 108 (2d Cir. 2006) (United States).

[8] McGurr v. N. Face Apparel Corp., 2021 U.S. Dist. LEXIS 196568 (United States).

Image Credit: Photo by Eva Bronzini

Fluid Trademarks essentially serve as an expansion of the base marks, which are registered and known to the public. What makes these marks “fluid” is the interplay between different iterations of the base mark, which is characterised by the use of creative yet diverse graphical and visual components while maintaining the core features of the base mark.

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The Nuts and Bolts of Foreign Filing Licence (FFL) In India

Like any other IP right, a patent is also a jurisdictional right confined to the jurisdiction where the application is filed, and the rights granted. A patent is also considered a negative right, which enables the patentee to prohibit others from manufacturing, using, selling, and distributing the patented goods and services. If the invention is not protected in a specific jurisdiction, it can be used by any third party without restrictions. Hence, the applicants must choose jurisdictions carefully to safeguard their inventions in those countries.

Given that a patent is a valuable asset that can aid international business expansion, businesses must develop a foreign filing strategy. The strategy could be based on specific parameters like potential markets, manufacturing centres, competitors, emerging markets, and licencing opportunities to decide where to seek protection for their invention.

Apart from the specific parameters outlined above, the applicant must be aware of particular provisions of the Patents Act, 1970, which forbid Indian residents from filing patent applications outside India without first filing in India.

It is pertinent to note that, as an exception, a patent application can be directly filed outside India by an individual (Indian Resident) by seeking prior approval from the Indian Patent Office. This is referred to as a Foreign Filing Licence (FFL), as envisaged under Section 39 of the Indian Patent Act, 1970.

 

What is the objective of providing the option of a Foreign Filing Licence?

The primary objective of FFL is to analyse patent applications for sensitive technological information or subject matter to prevent the unauthorised export of valuable knowledge to foreign countries. The FFL assists the Indian Patent Office/government in determining the patent application’s sensitive subject matter (pertaining to defence or atomic energy). Once it is ascertained that there are no issues with disclosing the details of the invention to a foreign country, the Indian Patent Office usually grants the Foreign Filing Licence within 21 days of receiving the request.

When the applicant is not required to seek a Foreign Filing Licence
  • When the applicant is not a resident of India, and the invention was created outside of the country.
  • If the applicant is a resident of India who filed a patent application in India six weeks before filing a patent application in another jurisdiction.
When the applicant is required to seek a Foreign Filing Licence
  • When the applicant or inventor is a resident of India.
  • When the applicant does not wish to file a patent application in India before filing a patent application outside of India.
  • When the applicant is a resident of India, a patent application has been filed in India, but the six-week term has not yet expired.

It is important to note that if the invention is related to nuclear energy or defence, the Indian Patent Office may not issue the FFL without the prior consent of the Central Government.

 

Statutory provisions governing Foreign Filing Licence in India

Rule 71 of the Patent Rules, 2003 describes the procedure and mandates seeking permission to file a patent application outside India.  

Rule 71: Permission for filing patent applications outside India under section 39.

“(1) The request for permission to submit a patent application outside India shall be made on Form 25.

(2) The Controller must respond to a request made under sub-rule (1) within twenty-one days of the request being filed.

Provided that in the case of inventions relating to defence or atomic energy, the period of twenty-one days shall be counted from the date of receipt of consent from the Central Government.”

 

Requirements for Seeking a Foreign Filing Licence

Since the main objective of FFL is to examine the nature of inventions and technologies in the nation’s best interest, an applicant must sufficiently disclose the invention’s details, including the title, description, and drawings (if any). In addition to the above information, the applicant must submit the following forms with all required data.

Form-25[1]: to request permission to make a patent application outside India. Form 25 must include:

  • Title of the invention
  • Name, address, and nationality of inventors who are “resident in India,”
  • Name and address of the applicant if rights have been assigned to the applicant.
  • Names of foreign countries where the application will be submitted once the Foreign Filing Licence is issued.
  • Reason for making such an application.

Form-26[2]: Power of Attorney (POA) from the inventor(s) or applicant residing in India and appointing a patent agent to represent them.

 

Can a Foreign National Apply for a Patent in India?

As outlined above, an Indian Foreign Filing Licence is not applicable for foreign nationals filing a patent application in India. A foreign national may apply for a patent in India by following one of the two routes mentioned below:

  1. Paris Convention Route: Under the Paris Convention for the Protection of Intellectual Property, a foreign national of a convention country can use the convention route to file a patent application in India. Any invention filed in their home country may also be filed for patent protection in India within 12 months by claiming priority from the earliest filed application in their home country.
  1. Patent Cooperation Treaty (PCT) Route: A foreign national may also file a patent application in India under the PCT route.

However, if they intend to file a patent application directly in India, they must follow their country’s patent law to confirm if there is a similar requirement in their jurisdiction.

Even though FFL enables Indian residents to file patent applications directly in a foreign country without filing the first application in India, inventors and the applicants (who are Indian residents) must strictly comply with the requirements of the FFL discussed above to avoid serious consequences, including imprisonment for a term of up to two years, or a fine, or both.

References:

[1] https://ipindia.gov.in/writereaddata/Portal/IPOFormUpload/1_37_1/form-25.pdf

[2] https://ipindia.gov.in/writereaddata/Portal/IPOFormUpload/1_38_1/form-26.pdf

Image Credits: Photo by JESHOOTS.COM on Unsplash

Even though Foreign Filing Licence (FFL) enables Indian residents to file patent applications directly in a foreign country without filing the first application in India, inventors and the applicants (who are Indian residents) must strictly comply with the requirements of the FFL discussed above to avoid serious consequences, including imprisonment for a term of up to two years, or a fine, or both.

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Anticipation of Invention: Patent and Latent Threats

A patent is representative of a quid pro quo arrangement and on the basis thereof patentees are granted a monopoly over their inventions. However, the process of securing such a monopoly can be complicated by ‘anticipation.’ Any invention anticipated in a prior art is most likely to be invalidated or made ineligible for a patent grant. This is because anticipation signifies a lack of ‘novelty’ in the claimed patent.

The concept of anticipation varies across jurisdictions, generally differing on the offering of the grace period. For instance, in the US a one-year grace period is provided to an individual for filing a disclosure in the event of obtaining the confidential subject matter of the invention directly or indirectly by the inventor or the joint inventor. Here, the principle of relative novelty governs the consideration of anticipation. Whereas in Europe, only a six-month grace period is provided, only in cases where the information is obtained by deceit or has been made public through an official international exhibition.

The law in India has taken an alternative route. The Indian Patent Act, of 1970 has identified conditions in which the grace period is afforded to evaluate anticipation. The Act defines what does not constitute anticipation under sections 29-34.

This article aims to provide the reader with a better understanding of the concept of anticipation under the Indian Patent Act, 1970.

 

What Amounts to Anticipation for Patents in India?

 

As highlighted above, the term anticipation is not defined in the Indian Patent Act,1970 however, the Act specifies what is not considered anticipation under Chapter VI, Section 29-34.

In the case of M. C. Jayasingh vs Mishra Dhatu Nigam Limited,[1] the Madras High Court while examining the provisions pertaining to “Anticipation” under the Indian Patents Act 1970, observed inter alia, “Though Section 13(1) refers repeatedly to “anticipation”, the expression “anticipation” is not defined in the Act. But, Chapter VI, containing Sections 29 to 32, deals with anticipation by previous publication. Here again, there is an element of confusion. Sections 29 to 32 do not stipulate as to what constitutes anticipation by publication. Rather, these sections merely point out what would not constitute anticipation. While Section 29 indicates what is not anticipation by previous publication, Section 30 indicates that a mere communication of the invention to the Government may not constitute anticipation. Similarly, Section 31 indicates when a public display would not constitute anticipation, and Section 32 indicates when the public working of a patent would not constitute anticipation.”

The Court proceeded to observe that a conclusive meaning of anticipation could be deciphered by examining the expression “new invention” under section 2(1)(l). Hence, the anticipation by publication would simply mean “that the subject matter had either fallen into the public domain or had become part of the state of the art.” This understanding of anticipation is further circumscribed by the exclusions mentioned under Sections 29 to 32.

It is pertinent to note that the concept of anticipation does not necessarily prevent an inventor from doing something purely because it would be an obvious/anticipated extension of what had been known in the art before the priority date. It rather demands a deep deliberation and analysis of what would have been obvious or already in use at the priority date to an individual skilled in the art who had access to what was known in the art at that date.

Anticipation by Previous Publication (Section 29)

 

This section provides that any publication of the invention made in India or abroad without the prior consent of the applicant or patentee is not considered anticipation and the ground for rejection of the patent. The patentee must establish that he filed an application for the patent as soon as he found out about the publication. This section does not mention about the time period of filling the application after such a publication.

The law on anticipation by prior publication has been summarised by Sachs LJ in the case of General Tire & Rubber Company v. The Firestone Tyre and Rubber Company Limited And Others,[2] as, “If the prior publication contained a clear description of, or clear instructions to do or make, something that would infringe the patentee’s claim if carried out after grant of the patentee’s patent, the claim would be anticipated. If, on the other hand, the prior publication contained a direction which was capable of being carried out in a manner which would infringe but would be at least as likely to be carried out in a way which would not do so, the patentee’s claim would not be anticipated, although it might fail on the ground of obviousness. To anticipate the claim, the prior publication had to contain clear and unmistakable direction to do what the patentee claimed to have invented.”

 

Anticipation by Previous Communication to the Government (Section 30)

 

Any disclosure of the invention to the government prior to the filing date of a patent application for the purpose of the investigation is not considered anticipation.

Moreover, in Shogun Organics Ltd. Vs. Gaur Hari Guchhait & Ors[3], the Delhi High Court clarified that the language of Section 30 now makes it clear that the disclosure to a government department or to any other authority, not just of the patentee, but by any other person, would not constitute prior publication. The language is person-neutral. It cannot be said from a reading of the provision that only disclosure by the patentee/applicant is covered under Section 30. 

 

Anticipation by Public Display (Section 31)

 

 An invention that has been displayed or published publicly is not eligible to be patented on the account of lacking novelty. However, under certain circumstances, a publicly displayed patent can be considered ‘novel’ in the following cases:

  1. The display or use of invention at an industrial or other exhibition is notified by the Central Government in the Official Gazette;
  2. Publication of any description or portion thereof as a result of the exhibition’s display or use of the invention;
  3. Usage of the invention by anyone, after the aforesaid display in exhibition, other than the inventor or a person deriving title from him; and
  4. Description of the invention in a paper read by the inventor before a learned society.

It is important to note that, an application for a patent can only be granted in the abovementioned circumstances if it is filed within 12 months of such public display/publication.

In Ralph M. Parsons Co (Beavon’s) Application[4], it was observed that learned societies would disseminate the relevant learning without consideration of economic gain. Thus, a learned society would normally be a non-commercial body of people and would not typically be associated with commercial exploitation. For a publication to be regarded as a “transaction” of a learned society, it must be published under the auspices of and finally be the responsibility of the learned society. Therefore, a publication that occurs via a third party, such as a reporter who is present at the conference, would not be regarded as a publication by society. Moreover, the publication by a society of an abstract of a paper is considered to be a publication of a paper.[5]

 

Anticipation by Public Working (Section 32)

 

An invention filed in a patent application is not considered to be anticipated due to the working of the invention in public by the patentee or person deriving title from him or any person authorized by him, subject to the meeting of the following criteria:

  1. The working of the invention should not be public prior to 1 year from the date of filing of the patent application; and
  2. The working of the invention in public is performed for the purpose of reasonable trial.
  3. The nature of the invention needs the invention to be worked in public.

Hence, the 12 months time period mentioned in the provision can be regarded as the ‘grace period’ for the inventor to file an application for the grant of the patent after public use. This is an opportunity for the inventor to apply for the grant of patent in an event of him mistakenly or in good faith using the invention in the public domain.

It is pertinent to note that, the section draws a significant distinction between public use and mere public publication.

In the case of Poysha Industries Ltd v. Deputy Controller of Patents and Designs[6], the Calcutta High Court adjudicated upon the issue of distinction between public use and public knowledge. The issue was whether the invention was publicly used or publicly known in a part of India. The Appellants, in support of their contention, stated that the method used by them to crimp the top portion of the containers did not require special skills or techniques. The said containers had been supplied by the appellants to M/s Zandu Pharmaceuticals and another company since 1960. However, the appellants failed to establish that the invention was publicly used and known, hence the appeal failed.

The same has been further clarified in Monsanto Co v. Coramandal Indag Products (P) Ltd.[7] by the Supreme Court, wherein it was held that, “It is clear from the facts narrated by us that the Herbicide CP 53619 (Butachlor) was publicly known before Patent Number 125381 was granted. Its formula and use had already been made known to the public by the report of the International Rice Research Institute for the year 1968. No one claimed any patent or any other exclusive right in Butachlor. To satisfy the requirement of being publicly known as used in clauses (e) and (f) of [s 64(1)], it is not necessary that it should be widely used to the knowledge of the consumer public. It is sufficient if it is known to the persons who are engaged in the pursuit of knowledge of the patented product or process either as men of science or men of commerce or consumers. The section of the public who, as men of science or men of commerce, were interested in knowing about herbicides which would destroy weeds but not rice, must have been aware of the discovery of Butachlor. There was no secret about the active agent Butachlor as claimed by the plaintiffs since there was no patent for Butachlor, as admitted by the plaintiffs. Emulsification was the well-known and common process by which any herbicide could be used. Neither Butachlor nor the process of emulsification was capable of being claimed by the plaintiff as their exclusive property. The solvent and the emulsifier were not secrets; they were admittedly not secrets and were ordinary market products. From the beginning to the end, there was no secret and there was no invention by the plaintiffs. The ingredients, the active ingredient, the solvent and the emulsifier, were known; the process was known, the product was known, and the use was known. The plaintiffs were merely camouflaging a substance whose discovery was known throughout the world and trying to enfold it in their specification relating to Patent Number 125381. The patent is, therefore, liable to be revoked.“

Therefore, for information to be publicly known, it is not essential that it should be used widely or be in the knowledge of the general public only. It would satisfy the legislative purpose if the information was known to individuals engaged in the research of the patented product or operating within the same industry or science.

 

Anticipation by Use and Publication after Provisional Specification (Section 33)

 

The objective of this section is to clarify that the information disclosed in public or the invention worked in public is not considered for anticipation between the filing of:

  1. A patent application with a provisional specification and a complete specification (within 12 months from the provisional filing); or
  2. A priority application in a convention country and a convention application in India.

This means that if the invention is used or published after the provisional application is filed, a complete specification filed later is not deemed to have been anticipated. Therefore, the Controller cannot refuse to grant a patent, revoke or invalidate it by citing that the subject matter of the provisional specification was used or published in India or in another jurisdiction at a time after the filing of said specification.

It is important to note that the provision applies only if the complete specification of the patent is filed within 12 months of the provisional specification.

Further, in cases where the complete specification has been filed in pursuance of a convention application, the Controller cannot reject the grant of patent on the grounds that the subject matter of the application was filed for protection in India within 12 months from the date of priority application filed in the convention country.

This section essentially seeks to safeguard the interests of the inventors between the periods of filing of provisional and complete specifications, and between the periods of filing the priority application in the convention country and the filing of the complete specification in India, in an event where the subject matter of the invention is placed in the public domain.

 

The Doctrine of Inherent Anticipation

 

The doctrine of inherent anticipation refers to a kind of anticipation wherein anticipation is found even in the absence of appropriate disclosure in a prior art reference.

In general, anticipation can be of two types: explicit anticipation and implicit anticipation (i.e., the doctrine of inherent anticipation). The term explicit anticipation refers to anticipation wherein each technical element disclosed in the claim is disclosed in a single prior-art document. According to the explicit anticipation, a claim is rejected by the patent office if all the technical features are found in a single prior art document. According to the doctrine of inherent anticipation (i.e., implicit anticipation), a claim is rejected by the patent office even if all the technical features are not disclosed in a single prior art subject to the presence of the missing technical features inhere in the prior art. 

Generally, there are two accepted tests to appropriately understand the doctrine of inherent anticipation. According to the first test, a check is performed to determine that the inherency of anticipation is not established only based on the probabilities or possibilities. A technical feature is considered to be inherent only if said technical feature is the “natural result flowing from” the invention description and invariably leads to the outcome. According to the second test, a check is performed to determine that an accidental or unintentional outcome, not appreciated as inherent to the claim by a person of ordinary skill in the art, does not constitute anticipation.

The IPAB in Enercon (India) Limited vs. Aloys Wobben[8] held that “patent is invalid for anticipation if a single prior art reference discloses each and every limitation of the claimed invention. The prior art reference may anticipate without disclosing a feature of the claimed invention if that missing characteristic is necessarily present, or inherent, in the single anticipating prior art. It is not necessary that inherent anticipation requires that a person of ordinary skill in the art at the time would have recognised the inherent disclosure. But it is necessary that the result be a necessary consequence of what was deliberately intended in the invention.”

 

Overcoming Anticipation Rejection

 

In view of the above, it is always advisable to file a patent application before placing it in the public domain. If the nature of the invention requires the invention to be placed in the public domain or worked in the public domain, the inventor(s) must ensure compliance with the requirements outlined in Section 29-30 in order to maintain the novelty of the invention and avoid patent rejection due to anticipation.

References:

[1] Civil Suit No.562 of 2007

[2] [1972] R.P.C. 457

[3] CS (COMM) 201/2017: (14.08.2019 – DELHC):MANU/DE/2598/2019: 2019 SCC OnLine Del 9653:Delhi High Court

[4] [1978] FSR 226

[5] Ethyl Corporation’s Patent [1963] RPC 155

[6] AIR 1975 Cal 178

[7] AIR 1986 SC 712

[8] ORA/6/2009/PT/CH ,ORDER (No. 18 of 2013)]

 

 

Image Credits: Photo by JESHOOTS.COM on Unsplash

Anticipation can be of two types: explicit anticipation and implicit anticipation (i.e., the doctrine of inherent anticipation). The term explicit anticipation refers to anticipation wherein each technical element disclosed in the claim is disclosed in a single prior-art document. According to the explicit anticipation, a claim is rejected by the patent office if all the technical features are found in a single prior art document. According to the doctrine of inherent anticipation (i.e., implicit anticipation), a claim is rejected by the patent office even if all the technical features are not disclosed in a single prior art subject to the presence of the missing technical features inhere in the prior art. 

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Demystifying the Inventorship Rights of an AI System in India

In this age of technological advancement, Artificial Intelligence (AI) has taken a giant leap from undertaking more straightforward tasks to originating marvellous inventions. Can an AI system be considered an inventor? This question has been beguiling jurisprudence across the globe for a considerable time. However, through the recent decision of Thaler v. Commissioner of Patents, the Australian Federal Court has forced jurisdictions across the world to re-think the inventive capacity and the role of AI in the contemporary ecosystem of innovation.

Through this article, we have tried to determine the implications of the Thaler decision and examine the position of the Indian legislation on the inventorship rights of an AI.

Factual Matrix

Dr. Stephen Thaler designed the Device for Autonomous Bootstrapping of Unified Sentience (DABUS). DABUS is an artificial intelligence system that pioneered the creation of an optimised beverage container and a flashing light for use in emergency circumstances. In the persistence of such a creation, Dr. Thaler filled patent applications worldwide, including in Australia, Canada, China, Europe, Germany, India, Israel, Japan, South Africa, the United Kingdom, and the United States.

“The Deputy Commissioner” rejected Dr. Thaler’s patent application in Australia, which named DABUS as the inventor. The matter was contested and finally, the Federal Court of Australia determined that the AI could be recognised as an inventor under the Australian Patent Act. According to the Court, the patent would be owned by Dr. Thaler, the developer, owner, and controller of DABUS. The Court determined that the legislative intent was to encourage innovation and that nothing in the Patent Act expressly or implicitly forbids AI from being named as an inventor.

Indian Stance: Inventorship Rights of an AI

In India, recently, the Controller General of Patents recorded objections to recognising an AI as an inventor in the matter of patent application numbered 202017019068, citing the provisions under Section 2 and Section 6 of the Patents Act 1970 (“Act”). The term “inventor” has not been defined under the Act. However, Section 6 states that, among other things, a patent application can be filed by any person claiming to be the true and first inventor of an invention.[1]

A bare reading of the provisions indicates that a natural person is distinguished from others. One can also observe that anyone other than a natural person will be unable to claim inventorship. Consequently, a natural person who is true and first to invent, and who contributes his originality, skill, or technical knowledge to the innovation meets the criteria to be acknowledged as an inventor in India.

In the case of V.B. Mohammed Ibrahim v. Alfred Schafranek, AIR 1960 Mysore 173, it was held that a financing partner cannot be an inventor, nor can a corporation be the sole applicant that claims to be an inventor. The Court, through this decision, emphasised that only a natural person (who is neither a financing partner nor a corporation) who genuinely contributes their skill or technical knowledge towards the invention shall qualify to claim inventorship under the Act.

In the light of this judgement, it can be perceived that an AI can also contribute its skill or technical knowledge to an invention and become an inventor. However, a reference to Som Prakash Rekhi vs Union of India & Anr, AIR 1981 SC 212, clarifies the qualification of a legal ‘person’ under Indian law. The Supreme Court observed that ‘personality’ is the sole attribution of a legal person. Such a ‘personality’ is an entity that has the right to sue or can be sued by another entity. An AI is not capable of using such rights, nor can it perform the required duties of any juristic personality independently. For instance, it cannot enter into an agreement or transfer or acquire patent/patent application rights. It would also be impossible for an AI to oppose or revoke a patent application. Hence, an AI falls short of the standards for being deemed an inventor in India.

Furthermore, the legislative intent behind the Indian Patent Act as found in the Ayyangar Committee report of 1959[2] suggests that inventors are mentioned in a patent application as a matter of right. Whether or not the actual deviser has a proprietary claim on the innovation, he has a moral right to be acknowledged as the inventor. This confers reputation and boosts the economic worth of the inventor. The inventor may give up his ownership interest in a particular patent due to a contract/agreement in law, but he retains his moral right.

An examination of legislative purpose and current public policy reveals a desire to protect the rights of the inventor/natural person who creates IP and can use his moral rights. On the other hand, AI cannot be granted moral rights nor appear to enjoy the benefits intended by legislation or public policy. Given this, designating AI as an inventor/co-inventor under current Indian rules seems impossible until explicit revisions are made.

Role of AI and Economic Growth in India

The Parliamentary Standing Committee “(“Committee“”) constituted under the Dept. of Commerce, analysed the current landscape of the IPR regime in India and observed its contribution to promoting innovation and entrepreneurship in the country in its report titled “Report 161: Review of the Intellectual Property Rights Regime in India” presented in the Rajya Sabha on  July 23rd, 2021. In particular, it examined the challenges that exist in the current legislative structure including the inventorship rights of an AI.

The Committee acknowledged the relevance and utility of AI-based cutting edge technology and machine learning, particularly in current times, significantly affected by the pandemic, in which digital technology proved to be instrumental in responding to the global crisis. Further, the Committee placed reliance on a report released by Accenture titled “How AI Boosts Industry Profits and Innovation” which estimated AI to inject US $ 957 Billion into the Indian Economy by 2035, if used optimally, to understand further the impact and role of AI and technology in the contemporary landscape and its relationship with Intellectual Property. 

Therefore, the Committee recommended a review of the relevant provisions of the Indian Patents Act, 1970 [Section 3(k)] and the Copyrights Act, 1957 on a priority basis to afford inventorship rights to AI in India. The Report also stated that “The Committee recommends the Department that the approach in linking the mathematical methods or algorithms to a tangible technical device or a practical application should be adopted in India for facilitating their patents as being done in the EU and U.S. Hence, the conversion of mathematical methods and algorithms to a process in this way would make it easier to protect them as patents“. Thereby including algorithms and mathematical processes under the ambit of patent law.

The Committee concluded that the legislative framework amendments would protect the works of an AI (either autonomously or with assistance/inputs from a human), incentivize pioneering inventions and R&D in the country, and maintain an enabling ecosystem for the protection of human intelligence innovations. The Committee maintained that the embargo placed on the inventorship rights of an AI would dissuade significant investments in the sector since such AI induced innovations would not be protected in the country.

Conclusion:  A Way Forward for Inventorship Rights of an AI System 

The decision would have a favourable impact on the holder of an AI. However, commentators have expressed concerns regarding the difficulties that may arise due to the extending of patent protection to AI-generated concepts, such as:

  • Impact on the Copyright law: A result of such a decision may lead the courts to re-examine the subject of AI authorship and regard AI as a creator of AI-generated works, which will open a Pandora’s box of judicial conflicts.[3]
  • It could potentially raise the bar for innovation or fundamentally alter the definition of a ‘person skilled in the art,’ making it more difficult for human innovators to obtain patent protection.
  • Accepting inventorship to include AI systems would elevate AI to the status of a legal person, allowing it to hold and exercise property rights.
  • It raises concerns about who has the right to use or own the AI-created product. As the AI system is not a legal body, it cannot enter into agreements allowing it to transfer its inventorship rights.

The ability of an AI to be an inventor under patent law will be determined by the specific language in each jurisdiction’s patent laws. To explicitly incorporate and recognise AI-generated ideas, legislative changes and amendments may be required in nations where plain statutory wording needs an inventor to be a natural person. In places where the statutory language is less explicit, such as Australia, the courts may have additional freedom to consider purposeful statutory interpretation and policy considerations.[4] We anticipate that all IP offices adopt a unified approach to successfully address the emerging difficulties posed by inventions by AI.

References: 

[1] Section 6, the Patents Act, 1970.

[2] Shri Justice N. Rajagopala Ayyangar, Report on the revision of the patents law, 1989.

[3] Rita Matulionyte, Australian court says that AI can be an inventor: what does it mean for authors? Kluwer Copyright Blog (September 2021).

[4] Lam Rui Rong, Can Artificial Intelligence Be an Inventor Under Patent Law? Australian Federal Court Says ‘Yes’ but U.S. District Judge Says ‘No’, SKRINE (September 2021).

Image Credits: Photo by Gerd Altmann from Pixabay 

The ability of an AI to be an inventor under patent law will be determined by the specific language in each jurisdiction’s patent laws. To explicitly incorporate and recognise AI-generated ideas, legislative changes and amendments may be required in nations where plain statutory wording needs an inventor to be a natural person. In places where the statutory language is less explicit, such as Australia, the courts may have additional freedom to consider purposeful statutory interpretation and policy considerations.

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