PCT rules amendment on fee reduction

Source: www.wipo.int

According to an amendment to the regulations under the Patent Cooperation Treaty (PCT) adopted by the Assembly of the International Patent Cooperation Union (PCT Union) on September 30, 2014, at its Forty-Sixth (27^th Extraordinary) Session, with effect from July 1, 2015, a revised schedule of fee structure is provided. As per amendment to the PCT Schedule of Fees, the 90% fee reductions in item 5 of the Schedule of Fees is applicable, if the international application is filed by:

• an applicant who is a natural person and who is a national of and resides in a State that is listed as being a State whose per capita gross domestic product is below US$ 25,000 (according to the most recent 10-year average per capita gross domestic product figures at constant 2005 US$ values published by the United Nations), and whose nationals and residents who are natural persons have filed less than 10 international applications per year (per million population) or less than 50 international applications per year (in absolute numbers) according to the most recent five-year average yearly filing figures published by the International Bureau; or
• an applicant, whether a natural person or not, who is a national of and resides in a State that is listed as being classified by the United Nations as a least developed country;

Provided that, if there are several applicants, each must satisfy the criteria set out in either sub-item (a) or (b).

Further, as per understanding adopted by the PCT Assembly, which became effective from October 11, 2017; the above stated 90% fee reduction would be applicable only to those applicant(s) who are the sole and true owners of the application and are under no obligation to assign, grant, convey or license the rights in the invention to another party which is not eligible for the fee reduction.

 

Hence, only if the PCT international application is filed by the sole and true owners of the invention satisfying the criteria set out in either sub-item (a) or (b) of item 5 of the Schedule of Fees, the 90% fee reduction is allowed. In case, the request for such fee reduction is filed by the assignee or other party on behalf of the sole and true owners of the PCT international application, such fee reduction shall not be allowed if such party is otherwise not eligible for the fee reduction.  

India: Delhi High Court on the link between cause of Action and Jurisdiction

Source: WWW.delhihighcourt.nic.in

In the case of Microsoft Corporation & Anr vs Rajesh Kumar & Ors the Hon’ble Delhi High Court dismissed the application filed by Rajesh Kumar and others (hereinafter referred as the Defendant) under Order 7 Rule 10 of CPC holding that the Hon’ble Delhi High Court had jurisdiction to decide the case filed by Microsoft Corporation and another (hereinafter referred as the Plaintiff).

BRIEF FACTS

• The Plaintiff is a subsidiary of American software company Microsoft Corporation, headquartered in Hyderabad, India. It has offices in the 9 cities of Ahmedabad, Bangalore, Chennai, Hyderabad, Kochi, Kolkata, Mumbai, the NCR (New Delhi and Gurgaon) and Pune.
• Defendant is a global software services company headquartered at New Jersey, USA and having other offices in DC Metro area and a state of the art outsourced software development based out of New Delhi, India.  
• It was alleged that the Defendant used unlicensed versions of the Plaintiff’s software for servicing its clients, on the Defendant’s employees’ laptops, during presentations, etc. Cause of action arose in Gurugram, Haryana and Hyderabad, Telangana where Plaintiff have their offices and carrying on their business.
• An application under Order 7 Rule 10 of CPC was filed by the Defendant alleging that in the entire plaint there is no allegation from the Plaintiff for copyright violation in Delhi, but only in Gurugram, Haryana and Hyderabad.
• Therefore, it was alleged this Court has no territorial jurisdiction to entertain this suit and the plaint be returned.

PLAINTIFF’S CONTENTIONS

• It was contended that since the Defendant was using the unlicensed software to service the clients in Delhi, the Court had jurisdiction.
• It was also stated that since the Plaintiff carries on business from Delhi, the Court had territorial jurisdiction. Thus, the Defendant’s own documents or its websites gave hints of its operative office in New Delhi.

Referring to page 24 of the Defendants’ website that the Defendant admitted that they are using the Plaintiff’s technology. It was further pointed out that page 46 of the website states that ‘the Courts in New Delhi, India shall have the exclusive jurisdiction on any dispute that may arise out of the use of this site.’

DEFENDANT’S CONTENTIONS

• It was alleged that this Court had no territorial jurisdiction as the Plaintiff had business and its subordinate offices at Gurugram and at Hyderabad and at which places the cause of action had also arisen.
• The allegations made in para 28 of the plaint that ‘Defendant would be servicing their clients, using the unlicensed software programs of the Plaintiffs, on the Defendants' employee’s laptops, during presentations etc., in Delhi’, were denied calling it a speculation.
• It was alleged that in the entire plaint there is no averment of Plaintiff's copyright violation within the territorial jurisdiction of this Court and rather per averments made in the plaint, the cause of action has arisen only at Gurugram, Haryana and in Hyderabad, Telangana at which places the Plaintiffs have their offices and are also carrying its business.
• The locus standi of the Plaintiff no. 2 was also challenged alleging that they were neither the owner of the copyright of this software nor an assignee.

COURT’S DECISION

• The Court referring to the rule laid down in Pfizer case and The LT Foods Ltd. case held that the Defendant had to specifically deny each, and every assertion made by the Plaintiff other than the jurisdiction, if they do not then it can be seen as an admission.
• The Court also considered that on their website the Defendant had admitted that one of its offices is in New Delhi, they have also mentioned that being a global company and as per that company’s governing laws, the Courts in New Delhi were given an exclusive jurisdiction. Also, as no denial of the allegations made by the Plaintiff was done, it cannot be said that the Court had no jurisdiction.

In view of the above, the Hon’ble Court held that the application under Order 7 Rule 10 for return of the Plaint filed by defendant, was devoid of any merits and dismissed the same. 

India: Impact of proposed EU IPR enforcement mechanism on the growth of Indian generic drugs

India is one of the largest suppliers of low cost generic medicines in the world. The use of generic medicines, in comparison with their branded counterparts, has the potential to substantially reduce out-of-pocket expenditure on drugs for chronic diseases like cancer. Friction between generic drug manufacturers and innovation companies typically arise when generic drug manufacturing companies initiate research using a patented product, to submit information to regulatory bodies like Drug Controller General of India, to seek approval for introducing a generic version of a patented product. Bayer vs Cipla case for development of generic drug “sorafenib” for patent product ‘Nexavar’ is a landmark case in this regard. Though the generic drug manufacturer is allowed to introduce the generic version subsequent to patent expiration, the research on patented drug is carried out when the patent is still in force. Several countries, including India, have provisions governing such research activities.

The Indian Patent Act, hereinafter referred as “Act” includes provisions that facilitate research and development using patented product/process without being liable for infringement. Such an exemption from patent infringement is known as Bolar Exemption. Section 107A (a) of the Act provides bolar provision as mentioned below:

107A. Certain acts not to be considered as infringement. – For the purpose of this Act,

(a) any act of making, constructing, using or selling or importing a patented invention solely for uses reasonably relating to the development and submission of information required under any law for the time being in force, in India, or in a country other than India, that regulates the manufacture, construction, use or sale of any product;…

shall not be considered as an infringement of patent rights.

The above provision is not limited to pharmaceutical products, but also extends to any product/process that may require regulatory approvals.

Médecins Sans Frontières (MSF) is a non-profit, self-governed organization providing emergency aid to people affected by armed conflict, epidemics and natural disasters, it includes distribution of affordable medicines like generic drugs to them. A recent move by the European Union (EU) to introduce an enforcement mechanism for IP rights has been criticized by the MSF in its recent 2018 letter to EU. Under the said enforcement mechanism, the court is empowered to grant ‘provisional injunction’ for infringement of patent. Further, the proposed provision also grants extraordinary right to the patent holder to draw everyone in the manufacturing and supply chain into litigation, if found suspected of patent violation, even without any actual proof of it. Furthermore, the scope of above said regulatory provision is so wide that it may even drag to the court the third-party procurers of generic drugs, such as MSF, that supplies affordable generic medicines to low income countries around the world. Hence, the said provision is vague and unethical.

India: ‘Magic Rice’ Belongs to Assam

The ‘magic’ Boka Saul, a century old breakfast staple in Assam, recently got a Geographical Indication Tag. In 2016, a Nalbari based NGO Baishya’s Lotus Progressive Centre and Simanta Kalita of Centre for 

Environment Education (CEE), Guwahati, applied for a GI tag for the rice. Hemanta Baishya, founder-member of Lotus Progressive Centre (LPC), was quoted telling a newspaper daily, that ‘Our years of hard work have finally paid off. The main aim with which we applied for the GI tag was to ensure the well-being of farmers that are dependent on this particular variety of rice. Farmers, who up till now were just growing it for themselves, will now be able to grow it for a wider audience. The Boka rice, we hope, will become a commercially-viable crop,’[1]

Boka Sauk or the ‘Magic Mud Rice’ as it is popularly known, is a paddy variety grown in parts of lower Assam i.e., Nalbari, Barpeta, Goalpara, Kamrup, Darrang, Dhubri, Chirang, Bongaiagoan, Kokrajhar and Baksa. It is sown in the month of June and harvested in December also known as ‘Xaali’ season locally. The consumption tradition of the rice dates back to 17th Century, when Boak Saul was consumed by the Ahom soldiers while they were fighting against the vast Mughal army.

Its specialty lies it the fact that it is a unique ‘zero fuel’ rice variety. Hemanta Baishya, founder-Member of Lotus Progressive Centre, in an interview said ‘Boka saul requires zero fuel. The rice does not need to be cooked’.[2] All that is needed to be done is soaking the rice in cold water for about an hour to swell and its ready to eat. According to a study by the Guwahati University’s Biotechnology Department, Boka Saul has 10.73 per cent fibre content and 6.8 per cent protein. The rice is highly nutritious, and it also cools down the body. Simanta Kalita of Centre for Environment Education (CEE), Guwahati told The Indian Express, ‘During floods, this is a great emergency food for obvious reasons. Going ahead, we hope the government will consider it for its relief programme.’[3]

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[1] http://www.guwahatiplus.com/article-detail/a-lot-can-happen-over-assam-s-magic-rice-boka-chaul

[2] https://indianexpress.com/article/north-east-india/assam/the-rice-that-needs-no-cooking-magic-rice-variety-from-assam-gets-gi-tag-5299318/

[3] https://indianexpress.com/article/north-east-india/assam/the-rice-that-needs-no-cooking-magic-rice-variety-from-assam-gets-gi-tag-5299318/

Afghanistan: Important Declaration on Recording of Licenses in the International Register Under Madrid System for International Registration of Marks

Source: www.wipo.int

In accordance with Rule 20bis(6)(b) of the Common Regulations as provided under the Madrid System for International Registration of Marks, the Government of Afghanistan has recently declared that the recording of licenses in the International Register shall have no effect in Afghanistan.

Consequently, a license relating to a mark in an international registration designating Afghanistan shall, in order to have effect in that Contracting Party, be recorded in the National Register of Afghanistan. The formalities required for such recording must be completed directly with the Office of Afghanistan and according to the conditions laid down by the legislation of that Contracting Party.

The declaration made by the Government of Afghanistan under the above-mentioned Rule came into force on June 26, 2018, which is also the date of coming into force of the Madrid Protocol with respect to Afghanistan.

India: Delhi High Court restricts the infringement of the mark ‘John Deere’

Source: www.delhihighcourt.nic.in

The Hon’ble Delhi High Court, on May 23, 2018, passed an order in the case of Deere & Company & Anr vs. Malkit Singh & Ors, in favor of Deere & Co. (hereinafter referred to as the “Plaintiff”) issuing an interim injunction against Mr. Malkit Singh & Ors (hereinafter referred to as the “Defendant”) holding that the Defendant has infringed the trademark and trade dress of the Plaintiffs products in bad faith. The case is listed before the Court on July 30, 2018, for disposal as well as for framing of issues and for case management hearing.

Brief Facts

• The Plaintiffs, a company existing under the laws of the State of Delaware, USA are leading manufacturers and exporters of agricultural vehicles including tractors, harvesters, etc. as well as their spare parts under the trademark JOHN DEERE. The products of the Plaintiffs are easily identifiable by their distinct share of green paint, augmented by yellow strip.
• The Plaintiffs have secured registrations for a number of its JOHN DEERE trademarks, including the (green yellow) trademark, under various classes, including Classes 7, 12 and 28 under the Trademarks Act, 1999.
• In the last week of October 2017, the Plaintiffs came to know that the Defendants were manufacturing, selling, exporting and advertising infringing products under the mark MALKIT by using an identical color combination as that of the Plaintiffs. Thereafter, a Cease and Desist notice was sent to the Defendants. In response, the Defendants emphasized that they had rights over its Green and Yellow mark.
• On further investigation, it was found that the Defendants were engaged in the manufacture, supply, export and sale of infringing tractors and agricultural equipment like Combine Harvesters, Rice Transplanter, Thresher, Straw Reaper, Mini Harvester etc. with an average production of 350 harvesters a year in Uttaranchal, MP, Andhra Pradesh, UP and Delhi.
• The present suit has been filed for permanent injunction restraining infringement and dilution of a trademark by the Defendant, passing off of trade dress, unfair competition, rendition of accounts, delivery up, damages, etc. 

Issues

1.      Whether the Defendants have adopted a mark similarly deceptive to that of the Plaintiff in bad faith?

Plaintiffs Mark

It is stated in the plaint that the Plaintiffs’ ‘leaping deer’ logo comprises an image of a yellow deer in conjunction with the trademark ‘John Deere’. It is further stated that a particular combination of the Green and Yellow colors for its agricultural implements i.e. green color for the body and yellow color for the seat and the wheels/rims.

Plaintiff’s Contentions

1. The Plaintiff contended that the Green and Yellow color combination had become so synonymous with the Plaintiffs that the particular shades of Green and Yellow are commonly referred to as John Deere Green and John Deere Yellow and the logo and the Green and Yellow color combination used by the Plaintiffs have collectively been termed as the JOHN DEERE marks
2. The Plaintiff submitted that the Defendant is engaged in the manufacture and supply of goods that are similar to the goods of the Plaintiff i.e., tractors and agricultural equipment. Further, the Defendants also advertise their products through various online portals like, www.malkitcombines.com, www.combineharvestor.co.in, www.justdial.com. The Defendants’ activities clearly evidence their intention to ride upon the reputation and established goodwill of the Plaintiffs’ products under the JOHN DEERE marks.
3. The Plaintiff contended that the Defendants had adopted and used identical trade dress, wherein the color scheme, getup, layout, manner of placement of various parts of the equipment is identical to the trade dress of the Plaintiffs’ JOHN DEERE products and its Green and Yellow color combination and the same is bound to create a false impression in the minds of unwary consumers and members of the trade that, the Defendants are somehow associated with the Plaintiffs’ business and that the Defendants have been specifically authorized to provide their goods and products under the John Deere trademarks by the Plaintiffs themselves.
4. The Plaintiff further relied on Deere & Co. & Anr. v. S. Harcharan Singh & Ors., wherein a Coordinate Bench of this Court gave an order dated March 5, 2015, recognizing the immense goodwill and reputation vested in the Plaintiffs’ said marks and has held such marks to be well-known trademarks as defined under Section 2(1)(zg) of the Trade Marks Act, 1999.

Defendant’s Contention

1. The Defendant stated that the the impugned color scheme for combine HARVESTOR was in use by the Defendant, was in the knowledge of the Plaintiff at least since 2008. In addition to the above, the predecessor of the Defendant has been using the impugned color scheme since 1988.
2. He further states that the Ministry of Agriculture took products of both the parties for testing purposes in 2015, and therefore, the Plaintiffs are deemed to have been aware of the Defendants’ use of the impugned color combination since 2015.

Rejoinder

In the rejoinder, the Learned Counsel for the Plaintiffs stated that the defenses sought were an afterthought and contrary to the Defendant’s own reply to the cease and desist notice. He pointed out that in reply to the cease and desist notice the Defendants had taken the stand that the color combination being used by them was totally different from the Plaintiffs’ color combination and asserted that they (the Defendants) had monopolistic copyright in the color combination.

Court’s View

• The Court opined that the Plaintiffs’ were entitled to sole and exclusive use of this trade mark comprising such color combination (trademarks include combination of colors by virtue of the definition under Trademarks Act, 1999) as well as the right to claim an injunction in respect of infringement of rights due to the fact that they had secured registration for the trademark comprising a color combination of green and yellow.
• The Court was of the view that the Plaintiffs’ Green and Yellow color combination has been used for 100 years over the agricultural products and even the tractors (green color for the body and yellow color for the seat and the wheels/rims), therefore, the mark/combination is reputable, distinctive and stands as an instant source-identifier for the Plaintiffs’ agricultural products.
• The Defendants’ adoption of an identical color combination, its use in the same manner as that of the Plaintiffs and its denial of the Plaintiffs’ rights in the said color combination in its reply to the legal notice amounts to unfair advantage and constitutes behavior which is contrary to honest and industrial practices. Therefore, the Defendants action amounts to infringement of the Plaintiffs’ trademark.
• Consequently, the Court till further order, ordered an interim injunction restraining the Defendants and related parties to deal with the agricultural equipment with Plaintiffs mark. 

The matter is listed before the Court on July 30, 2018, for disposal of I.A.3692/2018 as well as for framing of issues and for case management hearing.

IPR: A Fuel for Brand Building in India

Building a unique brand is essential for every business, be it involved in manufacturing, distribution of products or delivery of services. Businesses rely significantly on their brand value and reputation for commercial growth and consumer base expansion. However, more than establishing a brand, it is important to get its exclusive proprietorship. Intellectual property is one of the most crucial asset of a company which makes it imperative to protect it and safeguard it against unwarranted use and wrongful gain. Even if a brand is capable of defending itself against exploitation by unscrupulous competitors, it is necessary to seek as much legal protection for the established goodwill as possible.[1] Recently, Suresh Prabhu, Minister of Commerce and Industry, also commented on the importance of IP protection for effective brand building.

The misconception that trademark registration is useful only for MNCs and large corporations is widespread and for that reason many small businesses and entrepreneurs are discouraged to protect their businesses’ intellectual property. They fail to recognize the benefits of registration, like the financial benefits which include opening up opportunities for licensing revenue, franchise, increased exit valuations and increased borrowing prospects, that are possible with formal registration which gives legal reinforcement to a company’s use of their intellectual property. Monopoly rights which help to prevent third parties from creeping into your territory by using an identical or confusingly similar mark on identical or similar products are granted to the proprietor by protection of intellectual property.[2] Other benefits of protecting the intellectual property include the ability to use the registrations within market messaging. Geographical indications can also add value to brand image by boosting perceived quality like Darjeeling tea.[3]

Intellectual property, however, is not an end in itself but a powerful means for achieving the end of brand success. Their value is much more than being passively available on a register. They must be used creatively and should be used as commercially valuable assets than mere legal concepts and enforceable rights. This can be achieved primarily by putting them to work as tools for creating and developing a brand value for fostering the business.[4]  Strong brand image is a result of various efforts like the brand strategy, 

communication, marketing, media usage, quality control, trying to have an edge over the competitors. Even though the unregistered trademarks are protected as the proprietor has a recourse to common law remedies like passing off. However, they offer a very narrow scope of protection and a limitation on assertion of the proprietary rights. Therefore, trademark registration is recommended since it makes the proprietor the exclusive owner of the intellectual property across the applicable territory.

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[1] https://www.brandingstrategyinsider.com/2008/03/branding-and-tr.html#.Wx4JCdWWa1s

[2] https://www.footanstey.com/updates-a-publications/3057-the-importance-of-protecting-your-brand

[3] https://www.innovation-asset.com/blog/building-and-sustaining-brand-image-with-intellectual-property

[4] http://www.wipo.int/sme/en/documents/branding_fulltext.html