IP in IT:Global Strategy

Prof. Anil B. SurajIntellecture Seminar

Series

Copyright, Brain League IP Services, Now BananaIP Non-commercial use is permitted

Session Objectives To recognize the importance

of TRIPs in ensuring global standards

To understand the prevalent criteria to establish and enforce IPRs

“Interests” in Globalization Rebuilding by “developed”

economies – UN, IBRD, IMF, GATT/ITO

Strategic incorporation of “developing” nation concerns – UNCTAD & Part-IV GATT

Building of “consensus” in WTO

IPRs – General Bases Economic (and technological)

rationale – aids overall development

Social benefits – Public Domain and Basic Research

Legal monopoly – fair regulation within territory

Forms of IPRs Patents – Patents Act, 1970

Copyrights – Copyright Act, 1957

Trade Marks – Trade Marks Act, 1999

Industrial Designs – Designs Act, 2000

Forms of IPRs … Layout Designs of ICs –

Semiconductor Integrated Circuits Layout-Design Act, 2000

Geographical Indications – Geographical Indications of Goods (Registration and Protection) Act, 1999

Forms of IPRs … Plant varieties – Protection of

Plant Varieties and Farmers’ Rights Act, 2001

Traditional Knowledge – partly by Biological Diversity Act, 2002

Trade Secrets – Contractual – no legislation in India

COPYRIGHTS Statutorily provided privilege to

authors, aiming towards: Creative and Intellectual enrichment of the

public Progress of Scientific and useful Arts

(literary, artistic, musical, dramatic, cinematographic films, sound recordings and now performances & broadcasting)

Bundle of rights – right to make copies; communicate to the public; make adaptations and allow translations

“Mark” Includes – a device, brand, heading,

label, ticket, name, signature, word, letter, numeral

Also – packaging, combination of colours

Or any combination thereof

Sound = inherently distinctive and to be graphically represented

“Trade mark” Any Mark capable of:

Being represented graphically; and Distinguishing goods/services of

one person from those of others

3 objectives: to identify origin; to advertise the brand; and to indicate quality

IC Layout-Designs Layout Designs eligible for IPR

protection:

Originality – uncommon product of intellect

Not commercially exploited (for more than 2 years)

Inherently distinctive Distinguishable from other

registered designs

IC Layout Designs …

Use or sale of whole or original part of registered layout-design without permission is an infringement

No violation – if used for scientific evaluation, analysis, research or teaching

Creation of an independent original layout-design from analysis – can be separately registered

Evolution of IPR regime

Early 17th Century Monopolies Statute Maximum flexibility to national

governments – no global enforcement Paris Convention (1883); Berne

Convention (1886); Madrid Agreement (1891) Minimum obligations but with

flexibilities National Treatment; and Reciprocal

obligations – though not mandated

TRIPs Regime TRIPs (1995) – common

minimum institutional framework – what about flexibilities?

Scope of Patents

Patentability criteria

Enforcement mechanisms

TRIPs Regime – Salient Features

Basic Principles

MFN status; National Treatment

Forms of IPRs and bases of protection

Aiming for uniformity Multilateralism – impact on national

laws

TRIPs – Features … Special Provisions for

Developing nations

Accent on technology transfer & promotion – Brazil & Korea comparison

Enforcement Mechanisms

Civil and Criminal; Border measures

Enforcement of IPRsKey lessons from India and across the Globe

Large expectations – driven by small initiatives!!

High stakes IBM v. Amazon = dispute over 5

e-commerce based patents – valued more than $10 bn

Transmeta v. Intel = dispute over patents in power saving chips – valued at about $100 bn

RIM v. NTP = Blackberry technology – settled at over $600 mn

High Stakes … Volkswagen take over of Rolls

Royce - $712 mn – but missed the most important asset!!

Total value of IPRs owned by US is estimated at about $6 trillion

IPR valuations in M&As – rising the stakes further

IP Litigation If negotiations fail then litigate for

compensation Alcatel-Lucent matter – record verdict of

compensation = $1.53 bn

Suing could estrange potential partners (IPTV venture) – negotiate for licensing

EU – enforcement mechanism varies among member nations – a common directive for software patents failed

Litigation – Remedies Injunctions – temporary

(immediate) and permanent (final)

Damages or compensation – based on account on profits Actuals; Loss of Goodwill; Deterrent Microsoft cases in India - > Rs.1 crore

Legal and other costs Police and Court Commissioners

Litigation – Remedies …

Copyrights & TMs – registration is best proof – else, legal presumptions apply “Passing off”

Civil remedy – enforceable by a District Court – compensatory and injunctions NASSCOM matter

Criminal remedy –– law provides for minimum imprisonment and fines – offence is cognizable and non-bailable

Prevalence of Piracy Total counterfeit trade = $624 bn

Total online piracy = $84 bn

Top Hollywood studios spend more than $40 mn on counter-measures

Software piracy: Global = 35%; India = 73%; China = >90%

Online infringements Online auctions, sales or passing

off of proprietary software eBay; iOffer

Monumental task of monitoring China has 5 auction sites, 8 lakh

websites and about 2 lakh registered cyber cafes!!

Online counter-measures

New breed of Cyber investigators – set a thief to catch a thief!!

Fictitious impersonations in chat rooms and internet message boards

Counter attacks through hacking

Privacy concerns and fraudulent acts

Main Features of the IT Act

Information Technology Act, 2000

Allows for admissibility of electronic evidence in general procedure

Defines essential terms – computer, network/resource/system, electronic record, data, information, secure system, etc.

Cyber Crimes and Penalties

Section 43 – “damage” to computer or computer system – destroy, alter, delete, add, modify or rearrange any computer resource – Fines up to Rs. 1 Crore !!

Factual factors = unfair advantage; amount of loss caused; the repetitive nature

Cyber Offences Tampering/copying computer source

code or related documents – 3 yrs + 2 lakhs

Hacking into computer resource – 3 yrs + 2 lakhs

Breaching confidentiality of electronic documents – 2 yrs + 1 lakh

Publishing or transmitting obscene material in electronic form = 5 yrs + 1 lakh

Extra-territoriality application of the law – if Indian computer is affected

Liability in Cyberspace “Deep pocket” strategy – ISPs;

Credit Card agencies

Service Providers are exempted from liability if lack of knowledge despite “due diligence”

Comprehensive Search & Seizure Powers given to the Police

Principles of Patentability

What is a Patent? Patent – a monopoly right to an

inventor

20 year period of monopoly granted for inventions that satisfy:

Novelty Inventive Step or Non-

obviousness Utility or industrial application

What can you do with a Patent? Section 48 of the Patents Act,

1970: Make Use Sell Distribute Import

the invention within India

Effect of Patents – only territorial

Subject Matter of Patents

Must relate to any new process and/or a new product – improvements also considered – across any field of technology (TRIPs)

Any process, machine, manufacture, composition of matter or material

Non-patentability Section 3 of the Patents Act, 1970

enlists:

Frivolous or opposed to natural laws; Mere discovery or an abstract

formulation; No new product or reactant; Mere admixture or aggregation; Mere arrangement of known

devices;

Non-patentability … Section 3 enlists … :

Mere method of a mental act or game;

Mere presentation of information;

Mathematical or Business methods;

Computer programs per se or algorithms;

US Case Studies Gottschalk v. Benson (1972) – NO

– unless there is a physical effect

Diamond v. Diehr (1981) – YES – if part of an otherwise patentable process with a tangible result

State Street Bank (1998) – YES – useful computation is in itself a tangible result

EU Case Studies EPO Board – In re Vicom Systems (1987)

– YES – mathematical method must be directed to “technical process” Digital processing of images Though not tangible or concrete, its utility

was of “technological character”

In re Sohei (1996) – YES – despite “mix of technical and non-technical elements” – if for an ultimate technical solution

Patentability – Novelty Prior art (not just documents) –

i.e., open to public before the “priority date” (first filing of provisional application)

Known, used, published, patented elsewhere, offered for sale, abandoned, in priority elsewhere

Prior disclosure – must have been clear (and inevitable)

Patentability: Non-Obviousness

Not State of the art – not previously known or used publicly

Obvious – as to a person ordinarily skilled in the art – a hypothetical construction

Identify inventive step; compare combined prior knowledge; establish similarities; evaluate if it is obvious to skilled person

Patentability: Utility

Current – contemporary requirement

Substantial and significant value

Credible – to be made and to be used