Madras High Court admits PPL’s appeals and vacates ‘stay’ granted to SIMCA against Copyright Board order

In an order on the last day before the X’mas vacations the Madras High Court admitted the appeals filed by PPL against the Orders of the Copyright Board in the compulsory licensing dispute. We had blogged about this move over here. The radio stations had initially challenged PPL’s appeals on the grounds that the Madras High Court did not have the jurisdiction to hear the appeals. The provision in question, i.e. Section 72 of the Copyright Act, 1957, allows the Appellant to file an appeal against the Copyright Board in the jurisdiction where the appellant is carrying out his own business. In the present case PPL had contended that it was doing business within the Madras High Court. The radio stations tried to oppose this on the grounds that the present appeal should have been filed before the Bombay High Court because PPL had preferred this jurisdiction the previous time they had filed an appeal against a decision of the Copyright Board. The High Court obviously shot down this argument and held that since there was no dispute that PPL was carrying out business in Madras, the criteria of Section 72 was fulfilled thereby paving the way for PPL’s appeals to be admitted.
Image from here.

PPL had also filed an application for a stay of the Copyright Board judgment. The Madras High Court however refused to grant such a stay since PPL was unable to convince it of the need for such a stay.

Surprisingly, the Court also vacated its earlier stay of the Copyright Board Order with respect to its application against SIMCA and Super Audio. We had blogged about the initial stay over here. The surprising factor in this order is its scanty reasoning which is limited to a mere 5 lines. Given the completely different fact situations between PPL’s request for a ‘stay’ and SIMCA request for ‘stay’ the Madras High Court should have passed a more detailed order especially since the Delhi High Court has stayed the operation of the
Copyright Board with respect to T-Series which like SIMCA was not heard by the Copyright Board before orders had been passed against it.
-Courtesy:Spicy IP blog

Madhya Pradesh High Court

Brief

Citation

Jagdamba Oil Agency vs K.S. Oils Ltd

Judgement

Rajendra Menon, J.

1. Challenge in this petition under Article 227 of the Constitution is made to an interlocutory order dated 27-6-2005 passed by learned Distt. Judge, Morena in Civil Suit No. 3-A of 2005.

2. Learned Distt. Judge, has allowed an application for stay of the suit in question pending before him under Section 10 of CPC, thereafter, has proceeded to consider and decide certain applications interlocutory in nature filed under Order 39 Rules 1 and 2 of CPC by the respondents, petitioner feels aggrieved by the aforesaid action of learned Distt. Judge, Morena.

3. It is the case of the petitioner that the respondent No. 1 has filed the suit in question being Civil Suit No. 3-A of 2005 which is pending in the Court of Distt. Judge Morena it is alleged by the plaintiff in the aforesaid suit that the petitioner/defendant in the suit so also the plaintiff are engaged in manufacturing and sale of mustard oil and both are using a common trade mark, i.e., ("double Sher"). It is the case of the defendant/respondents that they are using the aforesaid trade mark since 1996, an application for registration of aforesaid trade mark is under consideration before the Competent Authority and they have acquired proprietary right and interest over the said trade mark. Inter alia contending that the respondents be restrained from using the aforesaid trade mark in the area of the plaintiff, suit in question has been filed.

4. Petitioner contends that on the same facts and circumstances, they have also initiated proceedings in the Court of Distt. Judge, Darjeeling under Section 142 of the Trade Mark Act and have sought various reliefs in the said suit filed by them in Darjceling. An objection was raised and taking recourse of the provision of Section 10 of CPC, petitioner prayed for stay of trail of the present suit filed by the respondents pending before Distt. Judge, Morena. The application under Section 10 was taken up for hearing by the learned Distt. Judge Morena and by the impugned order, he has recorded a finding that the issues involved in both these cases, i.e., case pending before him so also under Section 142 before Distt. Judge, Darjeeling, involve similar questions and are substantially of the same nature and finding so, has stayed proceedings of the trial of the present suit pending before him. However, after having ordered so, learned Distt. Judge has proceeded to take up for consideration certain interlocutory applications pending in the suit.

5. It is the case of the petitioner that once learned Distt. Judge has come to the conclusion that conditions stipulated under Section 10 of the CPC for stay of the suit is attracted and has passed the order staying proceeding of the trial, learned Distt. Judge, it was argued by the petitioner’s Counsel has committed grave error in proceeding for consideration of interlocutory application including application under Order 39 Rules 1 and 2 of CPC. Inter alia contending that once proceedings in a trial of the suit is stayed exercising jurisdiction under Section 10 of CPC, learned Court below can not proceed to decide any other interlocutory application, petitioner is before this Court seeking a direction to the learned Distt. Judge, not to proceed with hearing of any application in the pending suit trial of which, stands stayed by the impugned order. In support of this contention, Shri Ankur Mody, learned Counsel representing petitioner, invited my attention to the following judgments :-

(i) Pukhraj D. Jain v. G. GopalLakmhna (2004) SCC 251;

(ii) Manilal v. Shri Meenu Singhania 1998 Volume 2 MPWN 198; and

(iii) Sujanbai v. Moliram .

On the basis of aforesaid judgments, it is argued that even for deciding an application under Order 39 Rules 1 and 2 of CPC, certain issues which are involved in the previous suit filed by the petitioner before Distt. Judge, Darjeeling will have to be decided, the same be not permissible under law, it is submitted that learned Distt. Judge, be restrained from proceeding to decide the application under Order 39 Rules 1 and 3 of CPC.

6. Refuting the aforesaid, Shri Mriglani, learned Counsel representing respondents taking me through the suit filed by respondent in the Court of District Judge Morena Annexure P-2 so also the suit under Section 142 of the Indian Trade Mark Act, 1999 Annexure P-5, filed by the petitioner before Distt. Judge, Darjeeling, inviting my attention to the provisions of Section 142 of the Trade Mark Act, has argued that under law, both the proceedings are entirely different in nature and therefore no case for stay of the proceeding was in fact made out. However, apart from the aforesaid contention, Shri Mriglani has pointed out that it is well settled in law that the term "trial" used in Section 10 of CPC is limited in meaning and it only refers to final hearing of the suit and decision of the suit after such final hearing and it does not prevent hearing of interlocutory applications like application for injunction. Shri Mriglani argued that even if the trial of the suit is stayed under Section 10 of CPC, the Court is not precluded from taking up for hearing interlocutory applications including an application for injunction under Order 39 Rules 1 and 2 of CPC. In support of the aforesaid proposition, Shri Mriglani invited my attention to the observations made by the Bombay High Court in the case of Sujanbai (supra) relied upon by Shri Ankur Mody and also invited my attention to the following judgments:-

(i) Indian Bank v. M.S. Co-operative Federation ;

(ii) Rameshwer v. Vth Addl. Distl. Judge, Basti and Ors. AIR 1999 Allahabad 1;

(iii) Escorts Construction Equipment Ltd. and Ors. v. Action Construction Equipment Pvt. Ltd. and Anr. AIR 1999 Delhi 73;

(iv) Baburao Vithalrao Sulunke v. Kadarappa Prasappa Dabbannavar and Anr. AIR 1974 Mysore 63;

and two judgments of this Court in the case of:-

Bhuralal Tejpal and Ors. 1982 MPLJ 312 and Shri Mahila Grih Udyog Lijat Papad v. Smt. Usha Sontake 1999 (I) MPJR 130.

7. That apart, it was contended by Shri Mriglani that in a petition under Article 227 of the Constitution, interference can be made by this Court only if it is found that the order impugned is passed in total disregard to and in contravention of settled principle of law, statutory provision and is perverse to such an extent that no prudent person can record the impugned finding. Inter alia concluding that the order passed in the facts and circumstances of the case is not of such a nature that interference in a petition under Article 227 of the Constitution is called for, Shri Mriglani inviting my attention to a judgment of the Supreme Court in the case of Naresh Shridhar Mirajkar and Ors. v. Slate of Maharashtra , had

argued that in the facts and circumstances of the case, the order impugned does not call for any interference in these proceedings under Article 227 of the Constitution.

8. I have heard learned Counsel for the parties and perused the record. So far as merit of the conclusion with regard to maintainability of the suit filed by the petitioner under Section 142 of the Registration of Trade Mark Act or otherwise are concerned, I am of the considered view that this question need not be looked into in the present proceedings as they are not relevant for deciding this petition. In this petition, the only short question involved is as to whether the direction given by the learned Court for proceeding to decide the interlocutory application is in accordance with law.

9. Learned Distt. Judge, Morena having considered rival contentions has recorded a finding in Paras 9 and 10 in the impugned order that the proceedings pending before him so also before Distt. Judge at Darjeeling are similar in nature, question involved in both the cases are identical and therefore, has stayed trial of the suit pending before him. Thereafter, he has ordered that he will take up for hearing certain interlocutory application filed by the plaintiff/respondent and has fixed the case for further proceeding. The question is that whether the same is permissible. Even though, elaborate argument has been advanced by both the side, I am of the considered view that the question stands settled and concluded by series of judgments. Supreme Court in the case of lndian Bank (supra), has considered the aforesaid question in Paras 8 and 9 in the said judgment meaning of the word "trial" as contained in Section 10 has been interpreted and it has been held by the Supreme Court that the object of prohibition contained in Section 10 is to prevent concurrent finding from simultaneous trial of two parallel suits. It has been held by Supreme Court that there is no bar to the institution of a suit nor is there any bar for passing interlocutory orders, such as orders for consolidation of the suit, attachment and appointment of receiver. It is clear from the observations made by Supreme Court in Paras 8 and 9 of the aforesaid judgment even if the trial of the suit is stayed exercising power under Section 10 of CPC, the Court is not precluded from proceeding to hearing of interlocutory application like application for temporary injunction. The aforesaid view of the Supreme Court is consistently followed in all the cases relied upon by Shri Mriglani. The same view is reiterated by Allahabad High Court in the case of Rameshwar (supra), in Para 6 wherein, it is held that even after stay of proceeding of a suit under Section 10, consideration of interlocutory matters can be made by the Court. Similarly, in the case decided by Delhi High Court and Mysore High Court, the same view is upheld. Two Benches of this Court have also considered the said question in the case of Bheralal Tuja Prasad (supra), it has been held by this Court that application’s for temporary injunction or appointment of receiver can be taken up even after orders are passed staying proceeding in a trial. In the case of Shri Mahila Grih Udyog (supra), specific question with regard to consideration of an application for temporary injunction under Order 39 Rules 1 and 2 of CPC and the implication of stay of a suit under Section 10 of CPC was considered and learned Judge has held in clear term that even after staying proceeding pertaining to trial of a suit, application for temporary injunction under Order 39 Rules 1 and 2 of CPC can be taken up for hearing.

10. Considering the settled legal principle that emerges from a combined reading of the aforesaid judgments, I am of the considered view that learned Distt. Judge, Morena has not committed any error in proceeding to decide the interlocutory application even after staying trial of the suit under Section 10 of CPC. The order passed by learned Court is strictly in consonance with the settled legal principle and there being no apparent error of law the order impugned does warrant interference exercising jurisdiction in a petition under Article 227 of the Constitution. Accordingly, I find no ground to interfere in the matter.

11. The arguments advanced by Shri Ankur Mody to the effect that even for deciding application under Order 39 Rules 1 and 2 of CPC, the questions which are substantially in issue in earlier suit filed by the petitioner at Darjeeling will have to be considered and decided, is not to be taken into consideration by this Court in these proceedings but these are the factors which are to be considered by the Court concerned which decide application under Order 39 Rules 1 and 2 of CPC. Aforesaid arguments are to be advanced by the petitioner before the Court when the application for injunction is taken up for consideration and at this stage on these grounds, this Court can not pre-suppose that for deciding the application under Order 39 Rules f and 2 of CPC, the Court is required to decide certain issues which are substantially in issue in the pending proceedings at Darjeeling. On these grounds, interference at this stage in this petition can not be made.

12. Accordingly, finding no ground to interference in the matter, appeal is dismissed without any order as to the costs.

Brief

Section 124 : Trademark Act Scope : Application maintainable in suit for infringement of Trade Mark

Citation

Arun Colour Chem & Ors vs Mithumal Essance Mart & Another

Judgement

1. This suit is filed by Arun Colour Chem, i.e. the Plaintiff No. 1 and Arun Colourchem Private Limited, i.e. the Plaintiff No. 2. The plaint as originally filed sought a permanent injunction to restrain the Defendants from using on their products any mark identical or similar to the Plaintiffs mark and label that would amount to passing off of the Plaintiffs registered trademark SUN and the SUN BRAND Label Mark. It has sought to restrain the defendants from infringing the Plaintiffs copyright in the SUN BRAND Label. Other prayers included an order for rendition of accounts and an order for damages. On 21st August, 2007, this Court allowed the I.A. No. 9498/2007 under Order 6 Rule 17 CPC permitting the Plaintiffs to amend the plaint on the basis of a CS(OS) 375/2005 Page 1 of 10 registration certificate for the word mark SUN having been granted to Plaintiff no. 2 by the Trade Mark Registry on 3rd February, 2007. Consequent upon the amendment being allowed, the amended plaint was taken on record. The amended prayer in para 19 seeks the relief of permanent injunction against the Defendants with respect to the infringement of the trade mark SUN in class 30 under No. 842504.

2. Plaintiff No. 1, Arun Colour Chem, is a partnership firm established in the trade of manufacture and sale of inter alia food colours and flavours in the year 2003. It carries on its business in Punjabi Bagh, New Delhi. Plaintiff No. 2, Arun Colourchem Private Limited, is a company registered under the Companies Act, 1956 in Haryana. This suit is instituted through Mr. Vam Dev Bhardwaj who is a partner in Plaintiff No. 1 and the Managing Director of Plaintiff No. 2.

3. The Plaintiff No. 1 claims to be the proprietor of the trademark SUN and the composite SUN BRAND Label Mark in respect of food colour preparations. The Plaintiffs state that their predecessor in right, title and interest, Arun Chemical Industries adopted the inherently distinctive composite SUN BRAND Label Mark in the year 1973 in respect of food colour preparations which it used till the year 1997 when the Plaintiff No. 2 acquired and took over its running business. Thereafter, the Plaintiff No. 2 extensively and continuously used and promoted the said composite trademark till 2003 when the Plaintiff No. 1 acquired the CS(OS) 375/2005 Page 2 of 10 trademarks SUN and the composite SUN BRAND Label Mark along with the subsisting goodwill and reputation from the Plaintiff No. 2. The Plaintiffs claim to have extensively and continuously used the said Label Mark for the last three decades.

4. It is stated that due to an inadvertent error, the Plaintiff was unable to renew registration of the SUN BRAND Label Mark. As already noticed, during the pendency of the suit, the Plaintiff obtained the registration for the word mark SUN on 3rd February 2007.

5. The Defendant No. 2, Jay Industries is a partnership firm having its registered office at Ahmedabad, Gujarat. It is engaged in the manufacture and trade of food colours since 1999 and also manufactures blended colours. The Defendant No. 1, Mithumal Essance Mart is located at Ahmedabad, Gujarat. The Plaintiffs state that in the month of February 2004, they came across SUN BRAND food colour preparations being manufactured by the Defendant No. 2 and marketed by Defendant No. 1. Ex. DW- 1/1 is the copy of the registration certificate of the trademark Sun Brand granted in favour of the Defendant No. 1 and Ex. DW 1/X1 is a Journal notification in respect thereof. DW – 1/2 is the copy of registration certificate of copyright for the title "SUN BRAND" in favour of the Defendant No. 1. The allegation by the Plaintiff is that the label used by Defendant No. 2 is a virtual copy of the Plaintiffs label in every minute detail.

CS(OS) 375/2005 Page 3 of 10

6. This court passed an order on 21st March 2005 granting an ad interim ex-parte injunction. Later after pleadings were complete, issues were framed on 21st January 2006. A preliminary issue was whether this Court has territorial jurisdiction to try the present suit.

7. Mr. Sushant Singh, learned counsel for the Defendant submits that even in the amended plaint, Plaintiff no. 2 continues to be shown as having its office at Bhadurgarh, Haryana. Since Plaintiff no. 2 does not have its office within the jurisdiction of this Court, the suit on its behalf is not maintainable even for infringement of the registered trade mark in terms of Section 134 of the Trade Marks Act, 1999 (TM Act). As regards the prayer for infringement of the copyright in the Plaintiffs Sun Brand Label, it is pointed out by learned counsel for the Defendant that there is nothing to show that Plaintiff no. 2 has assigned the copyright to Plaintiff no. 1 in writing as required under Section 19 of the Copyright Act 1957 (CR Act). He states that for the purpose of Section 62 (2) CR Act although Plaintiff No. 1 may have its office within the jurisdiction of this Court, in the absence of any assignment to it of the copyright by Plaintiff no. 2. The suit for infringement of copyright even on behalf of Plaintiff no. 1 is not maintainable.

8. Both the aforementioned submissions turn on whether in fact Plaintiff no. 2 has an office in Delhi. This is purely a question of fact. The trade mark certificate issued in favour of Plaintiff no. 2 on 3rd February, 2007 has been placed on record. It has, in fact, been marked as Ex. PW-1/12. CS(OS) 375/2005 Page 4 of 10 It clearly indicates that the address of Plaintiff No. 2 is 4/61, Punjabi Bagh, New Delhi-110 026. Mr. Anand states that this is in fact the address of the Plaintiff no. 2. He states that a formal application for further amending the cause title to reflect the said address of Plaintiff No. 2 could have been filed but that would have only further delayed the proceedings. He states that Plaintiff no. 2 in fact does have its address at the aforementioned premises which is within the jurisdiction of this Court.

9. If in fact Plaintiff No. 2 also has an office in New Delhi, then for the purpose of either Section 134 of the TM Act or Section 62 (2) of the CR Act this Court would have territorial jurisdiction to try a suit seeking reliefs of infringement of trade mark as well infringement of the copyright. Even without going into the question whether Plaintiff No. 2 has validly assigned the copyright to Plaintiff No. 1, since one of the Plaintiffs claiming to hold the copyright is within the jurisdiction of this Court, the suit for infringement of copyright would be maintainable in this Court in terms of Section 62 (2) of the CR Act.

10. It is submitted by Mr. Sushant Singh that it is the suit as originally instituted, which will have to be looked into in order to determine whether there was inherent lack of jurisdiction for this Court to try the suit. He relies on the decision in Kiran Singh Vs. Chaman Paswan, AIR 1954 SC 340. This Court is unable to agree with the above submission that irrespective of the subsequent change, on the basis of CS(OS) 375/2005 Page 5 of 10 which the amendment in the plaint has been permitted, this Court should still go by only the unamended plaint and determine whether it has jurisdiction. If, on the basis of the trade mark registration certificate issued in favour of Plaintiff no. 2 showing its address at Delhi, the plaint has been permitted to be amended, this Court fails to understand why it should not take notice of the fact that as of today Plaintiff No. 2 does have an office at Delhi.

11. For the aforementioned reasons this Court holds that it has territorial jurisdiction to try the present suit. The issue is decided in favour of the Plaintiff and against the Defendant.

12. As regards the remaining issues, it is submitted by learned counsel for the Defendant that it holds valid registrations in its favour having been issued by the Trade Mark Registry in Gujarat. Mr. Anand has placed on record the communication issued by Deputy Registrar of the Intellectual Property Appellate Board, Chennai, showing that there is an application ORA/154/2007/TM/AMD/8105 filed by the Plaintiff seeking rectification/removal of Trade mark No. 1191875 in Class 30 in favour of the SUN Brand. He also placed on record a copy of communication dated 16th July, 2008 of the L.O. and Dy. Registrar of Copyright showing that the Plaintiff No. 2 has filed a petition under Section 50 of the Copyright Act, 1957 for the rectification of ROC No. A-68344/2005 which is the copyright registration in favour of the Defendant herein. CS(OS) 375/2005 Page 6 of 10

13. Section 124 (1) Trade Mark Act, 1999 reads as under:- "Stay of proceedings where the validity of

registration of the trade mark is questioned, etc.- (1) Where in any suit for infringement of a trade mark

(a) the Defendant pleads that registration of the Plaintiffs trade mark is invalid; or

(b) the Defendant raises a defence under clause (e) of sub-section (2) of section 30 and the Plaintiff pleads the invalidity of registration of the Defendants trade mark,

the court trying the suit (hereinafter referred to as the court), shall,—

(i) if any proceedings for rectification of the register in relation to the Plaintiffs or Defendants trade mark are pending before the Registrar or the

Appellate Board, stay the suit pending the final disposal of such proceedings;

(ii) if no such proceedings are pending and the court is satisfied that the plea regarding the invalidity of the registration of the Plaintiffs or Defendants trade mark is prima facie tenable, raise an issue regarding the same and adjourn the case for a period of three months from the date of the framing of the issue in order to enable the party concerned to apply to the Appellate Board for rectification of the

register."

Section 124 (4) Trade Mark Act, 1999 states as under :- "final order made in any rectification proceedings referred to in sub-section (1) or sub-section (2) shall be binding upon the parties and the court shall

dispose of the suit conformably to such order in so CS(OS) 375/2005 Page 7 of 10 far as it relates to the issue as to the validity of the registration of the trade mark."

14. As far as the question of infringement of the Plaintiffs trade mark and defence of the Defendant that it has a valid registration of an identical mark in its favour, issues no. 2, 3 and 4 have been framed by this Court vide order dated 20th January, 2006. This Court would therefore have to await the outcome of the rectification proceedings referred to hereinabove under Section 124 (4) before deciding those issues. The final order in the rectification proceedings would bind the parties and this Court is required to dispose of the suit in conformity with the said order of rectification proceedings.

15. It was sought to be urged by Mr. Sushant Singh that normally an order staying the suit seeking permanent injunction for infringement of registered trade mark under Section 124 of the TM Act, 1999 is passed at an interlocutory stage and not when the suit is at the stage of final hearing.

16. This Court is unable to agree with the above submission. The wording of Section 124 (1) does not indicate that an order staying the proceedings cannot be passed at any time before the disposal of the suit or that it can be passed only at an interlocutory stage. Moreover, when the applications for rectification have been filed by the Plaintiff only in October and December 2007, there is no occasion for this Court to have CS(OS) 375/2005 Page 8 of 10 considered earlier whether the provisions of Section 124 of the TM Act stood attracted. It appears to this Court that there is no option but to stay the further proceedings in terms of Section 124 of the TM Act.

17. It is then submitted by Mr. Sushant Singh that since there is no parallel provision in the CR Act no stay of the proceedings qua the reliefs of permanent injunction for infringement of copyright can be granted. No doubt issue nos. 4, 5 and 7 deal with the issue of infringement of copyright and there is no provision parallel to Section 124 of the TM Act in the CR Act. Nevertheless this Court is bound to take note of the subsequent development in the form of the pendency of the rectification petition filed by the Plaintiff under Section 50 of the CR Act, challenging the grant of copyright in favour of the Defendant. Here, this Court notices that the defence of the Defendant is that it holds a valid trademark and copyright registration in an identical label. The outcome of the rectification proceedings would, therefore, have a direct bearing on the remaining three issues.

18. The prudent course to adopt would be to await the outcome of the rectification proceedings even as regards the question of its infringement of copyright.

19. This Court accordingly stays further proceedings in the present suit CS(OS) 375/2005 Page 9 of 10 and directs the parties to mention the case for listing after the final order is made in the abovementioned rectification petitions.

20. Adjourned sine die.

It is perhaps important to contextualise his statement in light of two specific events that I find particularly relevant:

1. The recent ‘Joint Strategic Plan to Combat Intellectual Property Theft’ statement delivered by the White House a few months ago (note the use of the word ‘theft’ in the title itself).

2. The ACTA negotiations, spearheaded by the US government, which while being masqueraded as a ‘trade agreement’ is in fact an intellectual property rights treaty designed to combat piracy.

WHY DISTINGUISH BETWEEN THE TWO?

Widespread public resentment surrounding the negotiation tactics as well as the subject matter of ACTA has been well documented, and frankly, heartening to watch, but I feel a need to stress on the importance of distinguishing ‘copyright infringement’ from ‘theft’ to prevent any equivocation on the part of government authorities to sway public opinion. Although the debate appears to be restricted to American circles for now, I believe that Indian policy must not be influenced by such misnomers on the issue of combating piracy and general copyright infringement policy debates in the future, besides the fact that it has significant jurisprudential ramifications.

LEGAL BASIS FOR THE PROP THAT COPYRIGHT INFRINGEMENT IS NOT THEFT

DOWLING AND GROKSTER CASE LAW

In the case of Dowling v. United States (1958) the US Supreme Court concluded that the National Stolen Property Act did not extent to items which infringed copyright. In this case, Paul Dowling was invested in the business of selling bootleg recordings of Elvis Presley, but the court in pertinent part observed that:

Although this question is part of a long-standing debate in copyright law circles, I’ve picked up on this issue in light of recent comments emerging from the Obama administration, specifically by the current Vice President, Biden that "Piracy is flat, unadulterated theft", and that "it should be dealt with accordingly."

"The infringer of a copyright does not assume physical control over the copyright nor wholly deprive its owner of its use. Infringement implicates a more complex set of property interests than does run-of-the-mill theft, conversion, or fraud."

Some have argued that the observation in the more recent case of MGM v. Grokster (2005) that "deliberate unlawful copying is no less an unlawful taking of property than garden-variety theft" discount the very argument. However, the basic legal difference between copyright infringement and theft is in no way negated by this observation.

NATURE OF RIGHTS

Perhaps the essence of the difference is in the nature of property rights itself, something that deserves closer jurisprudential analysis, which I will conveniently exclude from this post. However, I, like several others, argue that copyright infringement is not theft simply because one deprives its owner of its use completely, while in the case of infringement, there is no such deprivation. This flows from the ‘nature of rights’ issue, wherein copyright being a government granted monopoly right can continue to be exercised by the copyright/monopoly holder in spite of infringement, while in the case of, for example, theft of a watch, one is deprived of the ability to read time, sell or rent out the watch.

A similar argument has been advanced on the issue of music file-sharing, and I strongly agree with the view that merely because a particular song has been downloaded illegally, it does not directly account for a lost sale and therefore revenue loss to the recording label. Such a position presupposes that if that song has not been pirated, it would have resulted in a legal purchase of the same track by the individual, which is an incongruous presumption. No wonder the losses claimed by the entertainment industry have been dismissed as grossly inflated and inaccurate. Infringement of that track does not prevent future sale of the same track, so it is really correct to call it ‘theft’?

LEGAL TERMINOLOGY v. COLLOQUIAL LANGUAGE

This argument has been used to support the view that ultimately, actual legal terminology is unimportant, and if they are used interchangeably in the colloquial sense, then its use in any debate is perfectly understandable. Terry Hart in his blog argues that emphasising on the legal meaning of words ‘accomplishes little more than arguing for the sake of argument,’ and others argue that eventually, it is a sense of perception and feeling – people will be better able to understand the meaning of copyright infringement by equating the calling it ‘content theft’.

However, as I stated in the introductory paragraph, the very problem is that in using colloquial terms, by disregarding their legal meanings and implications, it is possible that the masses will be presented with a particularly grim view of infringement. The term ‘theft’ carries with it significant ethical connotations, is regarded as moral turpitude, and involves considerable value-judgement. While this may not seem as much to many, from a public policy angle and certainly a legalistic approach, such equation is simply preposterous.

I’ve noticed some specific cases where copyright infringement is presented as theft and while in some cases it is understandable, in others it is just not.

1. Content Creators: Equating copyright infringement with theft for a content creator arguably stems from emotional considerations – the feeling that they are being deprived of something that belongs exclusively to them. To some extent, their anguish is understandable, given the serious impact infringement has on creators directly. But equating the two is simply ignoring the real problem and preventing viable solutions to tackle the problem from being found.

2. Anti-piracy groups: The biggest culprits on this point are anti-piracy groups who have an obvious interest in equating the two (see above on inflated revenue loss figures) Backed by political groups and vice versa, their propaganda efforts have continued on and on. Remember the original DVDs we bought with the anti-piracy clip and voice-over saying:

"You wouldn’t steal a car. You wouldn’t steal a handbag. You wouldn’t steal a mobile phone. You wouldn’t steal a DVD. Downloading pirated films is stealing. Stealing Is Against The Law… Piracy: It’s a crime."

Fortunately, their propaganda efforts have been criticised by most people and have been the butt of several jokes. However, this does not mean that their ads/campaigns/statements will have no effect whatsoever on the common man. Some people are easily brainwashed, indifferent or just too lazy to process the information and decide for themselves. So there is always a danger that in the minds of an average man, copyright infringement is in fact, theft.

3. Educational information: I have noticed that in order to discourage infringement of copyright, it has often been equated with theft, perhaps to increase stigma attached to the act. But surely there are other ways to discourage an unwanted act than by equating two legally distinct crimes. Do we really need to equate two different crimes just to make the common man understand the implications better because there exists a possible analogy?

Again, I reiterate that it is a not a mere semantic issue. If piracy is to be tackled effectively, in India or elsewhere, creators, anti-piracy groups and politicians must understand that infringement and theft are conceptually, legally and in terms of socio-economic effects, completely different from one another. Combating the two require distinct processes, and only when the difference in the two is properly appreciated and presented to the public can policy formulation effectively take place.

Thus, it is my humble opinion that simply put, copyright is not a property right; it is not a right of ownership of property in the ordinary sense; it is a privilege, and it is certainly not absolute. For this and the reasons above, I find that copyright infringement is not theft and engaging in a rhetoric that equates the two, deeply damages the possibility of understanding the problem of infringement and finding suitable solutions to it. – From SpicyIP

In two judgments last week, the Supreme Court (SC) ruled that in road accidents, insurance companies should pay compensation under the ‘no-fault liability’ clause in the Motor Vehicles Act irrespective of the circumstances of the deaths. In one appeal, Indra Devi vs Bagada Ram, the death was invited by the negligence of the deceased driver himself. The Rajasthan HC asked the recipients of the compensation to return the amount with interest to New India Assurance Co as the claimants were not entitled to the amount. The SC set aside the high court order and asserted the ‘no-fault liability’ under Section 140 of the Act did not depend upon the conduct of the driver or the victim. In the second case, Eshwarappa vs CS Gurushanthappa, the drunk driver and his four friends died while rashly driving to a temple without informing the car owner. The accidents tribunal denied any compensation. However, the SC ruled even in such cases, ‘no-fault liability’ cannot be avoided.

Pre-deposit of half the loan must before hearing appeal
Banks are trustees of public funds and they have a duty to recover debts by adopting all legally permissible methods, the SC stated while setting aside the judgment of the Madras high court in the case, Indian Bank vs Blue Jaggers Estates Ltd. According to the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, the debtor must deposit half the amount claimed to be due before the tribunal hears his appeal against sale of securities. In this case, the securities were sold for Rs 5 crore. The debtor argued since the amount recovered by the sale was more than half the dues, there was no need to deposit more for moving the appeal before the tribunal. The high court agreed. However, the SC allowed the appeal of the bank stating the amount recovered by the sale would not absolve the debtor from depositing 50 per cent of the claim, especially when the tribunal had not determined the exact amount due from the debtor.

Criminal case quashed
The SC has set aside the judgment of the Karnataka high court and quashed criminal cases against a former director of RPS Benefit Fund Ltd, a company which invited deposits from the public and failed to return the money (MAA Annamalai vs State of Karnataka). The company was wound up by the court, following which cheating cases were filed against the directors and the company by the depositors. The high court allowed the prosecution of the ex-director to go on, though he had pleaded that he had resigned before the winding up of the company. The SC quashed the high court order.

Labour court to decide on ‘worker’
The SC has overruled the Allahabad high court in the case, Triveni Engineering & Industries vs Jaswant Singh, and declared that the question whether a person was a worker should be decided by a labour court or industrial court and not by the labour commissioner. The employee was transferred to another unit, but he did not go, protesting that he could not be transferred under the standing orders. The company denied that he was its worker. The high court asked the labour commissioner to decide the issue. On appeal, the SC held that the high court order was wrong.

State to decide on trade unions
Deciding a dispute between two rival trade unions in Tata Memorial Hospital Centre for recognition, the SC has held that the state government was the appropriate authority under the Maharashtra Recognition of TUs and Prevention of Unfair Labour Practices Act.

It overruled the Bombay high court which had held that the central government was the appropriate authority to take action in industrial disputes. The SC pointed out that the hospital and centre were independent of the central government, and therefore the state government was the proper authority.

Voltage stabilisers, electronic goods
The SC has held that voltage stabilisers are electronic items and therefore attracted lesser sales tax. Dismissing a batch of appeals from Uttar Pradesh, Commissioner of Trade Tax vs Parikh Gramodyog Sansthan, the court ruled that stabilisers are not electric goods. A voltage stabiliser might have many components some of which use electricity. That cannot be the sole reason for classifying it as an electrical item, the judgment said.

Many people think that the modern day economics makes one indispensable to use credit card services offered by the banking and other institutions. Well, the values of the yester-years have not withstood the challenges of modern era. From the notion that indebtedness is bad and should be avoided, many people have started displaying their credit cards as their social status!

Since the credit card system encourages one to borrow money or buy goods (whether it is a necessity or not) for loan without bothering about his ability to repay it, millions of people have fallen prey to the consumerist culture and into a debt-trap.

News reports show that hundreds of people have been driven to suicides because they could not withstand the ignominy of the filthy languages and strong-arm tactics adopted by the muscle men masquerading as “recovery agents” of these banks.

Well again, these unfortunate souls were not without any legal remedy. VPS LAW FIRM, has provided great mental relief and sense of security to hundreds of its clients by providing legal solutions to their credit card problems. It has obtained successful court orders against the illegal recovery procedures adopted by the banks in India.

by appeal_admin on August 12, 2010

Lakhani Rubber Udyog Ltd. Manufactures Hawai Chappel. They are registered owners of a trademark. Lakhani Rubber Udyog Ltd. filed a complaint with the Senior Superintendent of Police, Jallandhar against M/s. Saraswati Utpadan Pvt. Ltd. alleging that they are marketing inferior goods with the label Lakhani illegally and requesting action under Section 63 of the Copyright Act read with Section 78-79 of the Trade and Merchandise Marks Act, 1958. On enquiry the complaint was found to be incorrect as no infringing material was discovered on the said premises belonging to Saraswati Utpadan Pvt. Ltd. as alleged in the complaint.

A complaint was filed by Saraswati Utpadan Pvt. Ltd. against the Lakhani Rubber Udyog and in enquiry report Senior Superintendent of Police, the Superintendent of Police stated that application submitted by the aforesaid Lakhani Rubber Udyog, Faridabad was found to be false after investigation. Due to which the Saraswati Utpadan Pvt. Ltd. had lost its goodwill. Therefore the SHO, Adampur is being directed to take action against the aforesaid officer of Lakhani Rubber Ltd. U/s 182 IPC.

The Station House Officer of the Police Station, Adampur thereafter filed a complaint petition before the Chief Judicial Magistrate against the Managing Director of Lakhani Rubber Ltd. as well as complaints (i.e. Appellants herein).

The Appellant questioned the legality and/or validity of the said report under Section 195(1) of the Code of Criminal Procedure, 1973 and other provisions before the High Court of Punjab and Haryana by filing an application under Section 482 of the Code. By reason of the impugned judgment dated 17.8.2005, the High Court dismissed the said application.

As per the provisions of Section 195(1) of the Code of Criminal Procedure, 1973 the complaint petition could have been filed only by the Senior Superintendent of Police, Jalandhar or any authority higher in rank to him.

It was contended by the Respondents that as the complaint petition having been filed pursuant to the directions of the Senior Superintendent of Police itself by SHO, it is valid in law.

Section 182 of the Indian Penal Code, indisputably, provides for an offence falling under Chapter X of the Indian Penal Code.

Section 195 provides for prosecution for contempt of lawful authority of public servant, for offences against public servant and for offences relating to documents given in evidence. It contains an embargo stating that no court shall take cognizance of an offence punishable, inter alia, under the aforementioned provision except on the complaint in writing by the public servant concerned or by some other public servant to whom he is administratively subordinate.

Supreme Court in its judgement dated 22/04/2008 held that the High Court, committed a manifest error in so far as it held that the as the complaint was addressed to the SHO, he was the appropriate authority to lodge a complaint in respect of an offence punishable under Section 182 of the Indian Penal Code. The fact that the search was made pursuant to the directions issued by the Senior Superintendent of Police, Jalandhar is not in dispute.

Section 195 contains a bar on the Magistrate to take cognizance of any offence. When a complaint is not made by the appropriate public servant, the Court will have no jurisdiction in respect thereof. Any trial held pursuant thereto would be wholly without jurisdiction. In a case of this nature, representation, if any, for all intent and purport was made before the Senior Superintendent of Police and not before the Station House Officer.

No complaint, therefore, could be lodged before the learned Magistrate by the Station House Officer. Even assuming that the same was done under the directions of Senior Superintendent of Police, Jallandhar, Section 195, in no uncertain terms, directs filing of an appropriate complaint petition only by the public servant concerned or his superior officer. It, therefore, cannot be done by an inferior officer. It does not provide for delegation of the function of the public servant concerned.

In terms of sub-section (3) of Section 340 of the Code, a complaint may be signed by such an officer as the High Court may appoint if the complaint is made by the High Court. But in all other cases, the same is to be done by the presiding officer of the court or by such officer of the court as it may authorize in writing in this behalf. Legislature, thus, wherever thought necessary to empower a court or public servant to delegate his power, made provisions therefor. As the statute does not contemplate delegation of his power by the Senior Superintendent of Police, we cannot assume that there exists such a provision. A power to delegate, when a complete bar is created, must be express; it being not an incidental power.

The Supreme Court relied on the ratio laid down in Daulat Ram v. State of Punjab [(1962) 2 SCR 812], by Hidayatullah, J. (Single Judge) as well as decision was followed by a Division Bench of this Court in State of U.P. v. Mata Bhikh & Ors. [(1994) 4 SCC 95] and held that said decisions are squarely applicable to the facts of the present case and for the reasons aforementioned, the impugned judgment cannot be sustained and set aside judgement thereby allowing the appeal.

The Supreme Court further held that another complaint petition would be maintainable at the instance of the appropriate authority.

NEW DELHI – The Delhi High Court Tuesday upheld its single bench order that the office of the Chief Justice of India (CJI) comes within the purview of the Right to Information (RTI) Act and details of judges assets should be revealed under that.

A bench comprising Chief Justice A.P. Shah and Justices S. Muralidhar and Vikramjeet Sen said: The subordinate judiciary is already declaring their assets. So when they are accountable so are we. Thus, higher the judiciary, higher is the accountability towards the public at large.

During the pronouncement of the judgement, the judges assured that they too would declare their assets next week.

Emphasising the importance of RTI, the bench said: RTI has over-reaching impact. Citizens who require such information should not misuse the information, thus saving the independence of (the) judiciary.

Income tax returns and medical records will not be revealed under the RTI but if public interest is attached with it then it also needs to be disclosed, the bench said in a voluminous judgement.

Two resolutions in 1997 and 1999 had said this declaration of assets was not binding on judges but could be done voluntarily.

Regarding them, the court said: This resolution is made for accountability of judges and we should all follow the same.

The bench had reserved its order in November 2009.

Attorney General Goolam E. Vahanvati, appearing for the apex court registry, had contended that the resolution regarding declaration of assets by judges was non-statutory, non-binding and it could not force a judge to declare assets to the Chief Justice of India.

The attorney general said the high court single-judge bench had erred in declaring that the office of CJI comes within the ambit of the RTI Act and had interpreted the provisions of the legislation too broadly, which was unnecessary and illogical.

The high court in its Sep 2, 2009 verdict on the controversial issue held that the CJI was a public authority and his office came within the purview of the transparency law.

The judgment was contrary to the stand taken by CJI K.G. Balakrishnan, who has consistently maintained that his office is beyond the purview of the RTI law.

Some common examples of cybersquatting include:
The omission of the “dot” in the domain name: wwwexample.com;
A common misspelling of the intended site: exemple.com
A differently phrased domain name: examples.com
A different top-level domain: example.org
In addition to registering variants of trademarks, cybersquatters also rely on the fact that trademark holders often forget to re-register their domain names. Because domain name registrations last for a fixed period of time, if the owner of a domain name does not re-register the domain name prior to expiration, then the domain name can be purchased by anybody. Cybersquatters will snatch up a domain name as it becomes available. This process is often referred to as “renewal snatching.”

Victims of cybersquatting have several options to combat cybersquatting. These options include: sending cease-and-desist letters to the cybersquatter, bringing an arbitration proceeding under ICANN’s rules (ICANN is the nonprofit organization that oversees the domain name registration system), or bringing a lawsuit in state or federal court. Whatever strategy a victim of cybersquatting elects to use, that person should not dismiss the serious effects that cybersquatting can have if left unchecked.
Who Are Cybersquatters?
You might think that the typical cybersquatter is a lonely teenager working from his bedroom. Actually, some cybersquatters are large, profitable, and savvy businesses with massive domain name holdings.

Cybersquatters frequently own thousands—or even hundreds of thousands or millions—of domain names, which are typically misspellings or variations of others’ trademarks. Cybersquatters don’t acquire these domain names out of spite or for amusement. Rather, they acquire these domain names to make money. It’s all about the income stream, and if the income isn’t there, the cybersquatter will drop the domain name.

This is how it works: The cybersquatter registers a domain name containing another’s trademark and sets up a website. The cybersquatter displays advertisements on the website on behalf of advertisers willing to pay the cybersquatter anywhere from a few pennies to a few dollars each time somebody clicks on one of the ads. The cybersquatter then counts on the fact that Internet users will type in the cybersquatted domain name into their web browser and click on the ads. Multiply this by a hundred clicks per day, and multiply that by a thousand domain names, and suddenly we’re talking about a lot of money.

Cybersquatters recognize that a single domain name can bring in hundreds of dollars a day, and they capitalize on this by acquiring domain names that will yield substantial user traffic. Often, these are domain names that incorporate misspellings or variations of the best known trademarks. As an example, cybersquatters register more than 2000 domain names every day containing the trademark Microsoft. As another example, over 10,000 domain names exist containing variations of the trademark Coke/Coca-Cola.

While some of these businesses have re-branded themselves as “domainers” in an effort to legitimize their operations, the line between lawful domain name ownership and cybersquatting is not always so clear. And for every supposedly legitimate domainer, there are several outright cybersquatters operating from safe havens in the former Soviet Union or parts of Asia, who register domain names that overtly infringe upon others’ trademarks. Regardless of whether a cybersquatter owns one domain name or 100,000 domains names, its motive is the same: to generate money by trading off the goodwill of others’ trademarks.
The Harmful Effects Of Cybersquatting
Trademark owners should not underestimate the harmful effects that cybersquatting has on their business and on the goodwill associated with their trademarks. Cybersquatters hope that trademark owners will simply ignore their misconduct as a minor problem. In reality, however, the problem is much more severe.

Cybersquatters count on Internet users going to their websites by mistake. Unfortunately, this is not a rare occurrence. A cybersquatted domain name can easily attract in excess of 10,000 visitors a month. And these are 10,000 people who intended to go to the legitimate website, but ended up at the cybersquatter’s website instead. The cybersquatted website presents these 10,000 people with advertisements, typically for competitors of the legitimate trademark owner. As a single example, the cybersquatted website www.Macyss.com—a clear infringement on the department store chain Macys—displays ads for Victoria’s Secret, Sears, and Ann Taylor.

Nor should trademark owners count on Internet users to re-enter the correct domain name once they have arrived at a cybersquatted website. The fact that a cybersquatter retains a domain name, in of itself demonstrates that consumers are not only visiting the cybersquatted website, but are also clicking on the advertisements. Cybersquatters buy domain names because they are profitable. If users are not consistently clicking on the advertisements, the cybersquatter will drop the domain name from its portfolio.

Moreover, data suggests that users become frustrated with the trademark owner when the user lands on a cybersquatted website. Users expect trademark owners to police the cybersquatting of their trademarks, to acquire domain names containing common variations of their trademarks, and to adopt easy-to-remember domain names. Users become frustrated when trademark owners have not followed these steps. The fact that a user has arrived at a cybersquatted website indicates that the trademark holder has not undertaken these efforts—and does not respect the user’s business.

Finally, trademark owners must worry about the effects of cybersquatting on the value of their trademarks. A failure to police such misuse can result in the abandonment of the claim against the cybersquatter, and even the abandonment of trademark rights generally. As such, trademark holders should not downplay the serious harmful effects of allowing cybersquatters to misuse their trademarks. Rather, trademark holders should actively police potential cybersquatting and take corrective action when such misuse is discovered.
Legal Actions Against Cybersquatters and Domain Names – Domain Name Law & Domain Name Disputes
Victims of cybersquatting have several options they can choose from to stop a cybersquatter’s misconduct and recover their domain names. Initially, a trademark holder may simply wish to send a cease-and-desist letter to the cybersquatter, demanding that the cybersquatter return the domain name immediately. Such a cease-and-desist letter may state that if the cybersquatter does not comply with the letter, the trademark holder will file a lawsuit, which could result in serious consequences to the cybersquatter. The cease-and-desist letter is an inexpensive approach, which can often bring positive results.

Once a cybersquatting victim decides that he or she needs to adopt a more aggressive approach, there are two primary domain name rules providing legal channels for recovering a domain name: the Anticybersquatting Consumer Protection Act (“ACPA”) and ICANN’s Uniform Domain Name Dispute Resolution Policy (“UDRP”).

The ACPA allows trademark holders to file lawsuits against cybersquatters in the United States federal courts, and allows for the recovery of up to $100,000 per domain name in damages from the cybersquatter, plus costs and fees. The ACPA also addresses situations where the cybersquatter is located in a foreign country, or where the cybersquatter cannot be identified at all. In such situations, the ACPA enables the cybersquatting victim to recover his or her domain name, but does not allow for the recovery of damages. This process is referred to as an in rem action. The ACPA is set forth in the United States Lanham Act (15 U.S.C. §1125(d)), which is the comprehensive federal law on the topic of trademark infringement.

ICANN, the nonprofit organization that oversees the domain name registration system, has also promulgated rules governing domain name disputes. When anyone registers a domain name, that person is required to submit to binding arbitration in the event of a dispute concerning that domain name, including an allegation of cybersquatting. This binding arbitration is conducted according to ICANN’s Uniform Domain-Name Dispute Resolution Policy (“UDRP”). UDRP proceedings are intended to offer an efficient process, where the issues are decided without a trial or oral hearing. Unlike a lawsuit brought under ACPA, however, UDRP does not allow for the recovery of damages, costs, or fees.
Suing A Cybersquatter Personally (In Personam Claims Under Anticybersquatting Consumer Protection Act)
Where a trademark owner has identified the cybersquatter, and that cybersquatter is located in the United States—or has significant contacts with the United States—the trademark owner can bring an in personam claim under the federal Anticybersquatting Consumer Protection Act (“ACPA”). As contrasted with an in rem claim under the ACPA, an in personam claim enables a cybersquatting victim to recover damages, costs, and fees, in addition to recovering the domain name at issue. For a trademark owner to bring an in personam claim under the ACPA, the trademark owner must show:
Ownership of the trademark;
Ownership of a trademark may be demonstrated through a federal, state, or foreign registration trademark registration. Where no registration exists, common-law trademark rights can be demonstrated through the continuous use of the trademark in commerce.
The trademark is distinctive or famous;
A trademark is distinctive if it identifies the trademark owner’s goods or services. Courts consider several factors when determining whether a trademark is distinctive or famous, including but not limited to: the length of time the mark has been in use; the amount of investment made in promoting the mark; the geographic region where the mark is used; and whether there are similar trademarks in use.
The domain name and trademark are either identical or confusingly similar (or dilutive for famous trademarks); and
The domain name registrant acted in bath faith to profit from the trademark.
Courts consider several factors when determining whether a domain name registrant acted in bad faith, including but not limited to: the registrant’s trademark or other intellectual property rights (if any) in the domain name; the registrant’s prior use (if any) of the domain name in connection with the bona fide offering of goods or services; the registrant’s intent to divert consumers from the trademark owner’s website to a website accessible under the domain name, creating a likelihood of confusion as to the source of the website; and the registrant’s offer to sell the domain name for financial gain without having used the domain name in for the bona fide offering of any goods or services.
Sue The Domain Name And Not The Cybersquatter (In Rem Claims Under ACPA)
The federal Anticybersquatting Consumer Protection Act (“ACPA”) enables cybersquatting victims to recover their domain names even when the cybersquatter is located in another country, or where the cybersquatter cannot be identified at all. Such actions are referred to as in rem actions. While cybersquatting victims cannot recover damages, costs, or fees with an in rem action, they can recover their domain names. To succeed with an in rem action under the ACPA, the trademark owner must show:
Ownership of the trademark;
The trademark is distinctive or famous;
The domain name and trademark are either identical or confusingly similar (or dilutive for famous marks);
The plaintiff has tried to inform the registrant of the domain name of the violation and the plaintiff’s intent to file an in rem action; and
The court does not have jurisdiction over the registrant, or the plaintiff was unable to find the registrant, despite a good faith effort to do so.
To date, it is unclear whether the definition of cybersquatting is narrower for in rem claims under ACPA, as compared with in personam actions. Specifically, ambiguity continues to exist as to whether a plaintiff in an in rem action must demonstrate the registrant’s “bad faith.”
Actions Under ICANN’s Uniform Domain Name Dispute Resolution Policy
When a domain is registered, the person registering that domain name is required to submit to mandatory arbitration in the event of a future dispute concerning the domain, including an allegation of cybersquatting. ICANN—the nonprofit organization that oversees the domain name registration system—has implemented a streamlined process for resolving cybersquatting disputes, which tends to be quicker and less expensive than federal litigation. While ICANN’s Uniform Dispute Resolution Policy does not permit cybersquatting victims to recover damages, costs, or fees, it does enable them to recover a cybersquatted domain name. A petitioner seeking to use ICANN’s Uniform Dispute Resolution Policy ("UDRP"), must demonstrate the following elements to recover a domain name:
Ownership of a trademark;
A domain name that is identical or confusingly similar to the trademark owned;
The registrant has no legitimate interest or rights in the domain name, which may be demonstrated through: showing a lack of a bona fide intent to use the disputed domain to offer goods or services, and showing common knowledge of the trademark owner’s ownership of the mark; and
The registrant’s registration and use has been conducted in bad faith, which may include evidence that: a) that the domain was acquired primarily to sell to the trademark owner, c) the domain name was acquired to disrupt business of a competitor, d) the domain name was acquired to make money through consumer confusion.
An administrative panel of one or three people selected from an international body of Internet law practitioners serves as both the judge and the jury in a UDRP proceeding. A UDRP proceeding is relatively quick: A decision is typically issued less than 45 days after the complaint is filed. Notably, a party that files a UDRP complaint and loses may bring another legal action against a cybersquatter, including an action under the Anticybersquatting Consumer Protection Act.
Notable Arbitration Decisions

AnthonyQuinn.com
The estate of Anthony Quinn, the renowned artist and two-time Oscar-winning actor, filed a UDRP complaint against the registrant of AnthonyQuinn.com. The Quinn estate claimed that Anthony Quinn’s fame and success as both an artist and actor made his name internationally known in multiple categories of goods and services, including entertainment services, jewelry, watches, award statuettes, and entertainment awards.
The UDRP panel found that the registrant was not using the domain in connection with the bona fide offering of goods or services or making a legitimate non-commercial or fair use of the domain, because the registrant used the disputed domain to operate a website featuring links to various competing and non-competing commercial websites for the registrant’s own commercial gain, which was evidence of the registrant’s bad faith registration and use.
Class Actions Against Cybersquatters
While the idea of a class action against cybersquatters has not been tested, legal authorities indicate that such an action may prove viable. A class action is a lawsuit that is brought by a small number of plaintiffs (“representative plaintiffs”) on behalf of larger group (the “class”). Thus, for example, a single trademark holder could theoretically bring a lawsuit against a cybersquatter on behalf of both itself and other trademark holders who have been injured by the cybersquatter’s misconduct. A class action may be an effective tool against a cybersquatter because it threatens the cybersquatter with liability for numerous lawsuits within a single legal proceeding.

Class actions are possible where: 1) the class is so numerous as to make separate lawsuits impractical, 2) there are questions of law or fact common to the class, 3) the claims and defenses of the representative plaintiff is typical of the claims and defenses of the class, and 4) the representative plaintiff will fairly and adequately protect the interests of the class. In the context of cybersquatting, it is quite possible that trademark holders would satisfy these standards. Specifically, a cybersquatter may have infringed upon the rights of a class of trademark holders by registering numerous domain names infringing on their trademarks. Unlike a traditional anti-cybersquatting action, with a class action, the cybersquatter could be forced to turn over a major portion of its domain portfolio, as well as potentially pay significant damages.

In the same vein, legal authorities have postulated that a class action may be possible where the class is composed of consumers rather than trademark holders. Under this conception of the class action, a single consumer could bring a lawsuit on behalf of other consumers who have been mistakenly led to the cybersquatted website. Again, the benefit of such a class action is that the cybersquatter will face potential liability for its misconduct as to all consumers, and not merely to the representative plaintiff.

While the cybersquatting class action remains a new concept, attorneys who are experienced in anti-cybersquatting law have expressed a vigorous interest in pursuing these claims.
Domain Name Trademark and Copyrights
A close relationship exists between trademarks and rights in domain names. A trademark is a word, name, symbol or device which is used in connection with goods to indicate the source of the goods and to distinguish them from others’ goods (a service mark is the same as a trademark except that it identifies and distinguishes the source of a service rather than a product). Trademark rights may be used to prevent others from using a confusingly similar mark, but not to prevent others from making the same goods or from selling the same goods or services under a clearly different mark. As such, in order to serve as a trademark, the word, name, or symbol must not simply convey to the buyer qualities or characteristics of the goods, but it must be unique and distinctive.

A trademark comes into existence as soon as a business starts using that trademark in commerce. While registering a trademark with the United States Patent & Trademark Office offers a trademark holder certain benefits, it is not necessary to establish rights in a trademark.

Once a business has established rights in a trademark, it can prevent others from using that trademark—or confusingly similar words or symbols—on similar goods. However, the trademark holder generally cannot prevent another person from using that trademark on different goods, where there is no likelihood of confusion. As an example, the car company Lexus cannot prevent the computer services company Lexis-Nexis from using the trademark Lexis, because cars and computer services are so different that there is no likelihood of confusion.

Trademark law dovetails closely with anti-cybersquatting law. The owner of a trademark has the right to prevent another person from using the trademark—or a confusingly similar variation of the trademark—in a domain name, if the person has a bad faith intent to profit from the domain name. Congress has determined that it is unlawful for a person to register a domain name containing another’s trademark with an intent to profit on the other’s trademark. However, a trademark holder cannot prevent another from using the trademark in connection with sufficiently different goods. As such, Congress has required a trademark holder to show that the cybersquatter had a bad faith intent to profit from the domain name.

Occasionally, people speak about a domain name copyright or a copyright in a domain name. These are inaccurate and misleading expressions. Copyright is a form of protection provided to the authors of “original works of authorship” including literary, dramatic, musical, artistic, and certain other intellectual works. The copyright protects the form of expression rather than the subject matter of the writing. For example, a description of a machine could be copyrighted, but this would only prevent others from copying the description; it would not prevent others from writing a description of their own or from making and using the machine. Because it is unlikely that a domain name constitutes an “original work of authorship” as used in the Copyright Act, this body of law is not the most suitable for attacking cybersquatters.
Celebrity Domain Names And Personal Name Domains
In most cases, a person’s name will not constitute a protectable trademark because that person does not use his or her name as a unique identifier for goods or services he or she sells. Thus, even when a person has a unique name, he or she may not be able to protect it under traditional trademark laws.

However, this does not prevent an unscrupulous cybersquatter from registering a domain name that contains somebody else’s personal name, such as www.JohnSmith.com. Congress recognized this loophole, and sought to address it in the Anti-Cybersquatting Consumer Protection Act ("ACPA"). Among other things, the ACPA prevents a person from registering a domain name that consists of the personal name of another living person, or a substantially and confusingly similar name, with the specific intent of profiting from the sale of the domain name. Therefore, in order to invoke this section of the ACPA, the cybersquatter must have intended to sell the domain name for profit.

In certain cases, a personal name—such as a celebrity’s name—can acquire sufficient recognition to become a trademark. For example, it has been found that the singer Celine Dion has acquired trademark rights in her name because in addition to her fame, she uses her name in connection with a variety of goods and services. Where a person’s name has achieved trademark status, he or she can rely on the less restrictive provisions of the ACPA to obtain relief. In this case, the name’s owner need only show that the cybersquatter registered the domain name in bad faith—rather than showing that the cybersquatter sought to sell the domain name for financial gain.

People with significant name recognition should not ignore the serious harmful consequences of letting cybersquatters register domain names containing their personal names. Celebrity domain names have become big business. Such a domain name can easily bring in thousands of visitors of month, and may present content that is not in the celebrity’s best interest, such as explicit, adult-oriented content. As such, people should actively police the potential cybersquatting of their personal names.
Celebrity Domain Name Actions
Jason Bateman: Actor Jason Bateman recovered the domain name www.jasonbateman.com through a UDRP arbitration on January 9, 2008. The panel found that Jason Bateman had acquired rights to the JASON BATEMAN mark through his motion picture and television career. (NAF Claim No: FA0711001114949)

Michael Bloomberg: Financier and politician Michael Bloomberg was unable to recover the domain name www.michaelbloombergsucks.com in a UDRP action. The UDRP panel found that Bloomberg had failed to show bad faith when the disputed domain was being used in connection with a free speech website. (NAF Claim No: FA0104000097077)

Gisele Bundchen: Supermodel Gisele Bundchen recovered the domain name www.giselebundchen.com through a UDRP action. The panel found that Gisele had used the GISELE BUNDCHEN mark in connection with her extensive modeling career since the mid-1990s and had gained trademark rights accordingly. (NAF Claim No: FA0812001237167)

George Hamilton: Television and film actor and director George Hamilton recovered the domain name www.georgehamilton.com through a UDRP action. The panel found that Hamilton had used the GEORGE HAMILTON mark in connection with his extensive film and television acting and directing careerand had gained trademark rights accordingly. (NAF Claim No: FA0904001259771)

Kate Hudson: Film actress Kate Hudson, daughter of famed actress Goldie Hawn, recovered the domain name www.katehudson.com through a UDRP action. The panel found that Hudson had established common law trademark rights in the KATE HUDSON mark through her long and continuous use of the mark. (NAF Claim No: FA0910001290319)

Paul McCartney: Renowned singer Paul McCartney recovered the domain names www.paul-mccartney.com, www.paul-mccartney.net and www.sirpaulmccartney.com in UDRP actions. The UDRP panel found that McCartney was the exclusive owner of the trademark rights to the mark SIR PAUL MCCARTNEY and was one of the most well-known and recognizable celebrities in the world. (NAF Claim No: FA0104000097086)

Jerry Seinfeld: On April 22, 2008 comedian Jerry Seinfeld filed a UDRP action to recover the domain name www.jerryseinfeld.com. While the UDRP action was withdrawn, the parties evidently reached some sort of settlement because the domain name is now registered to Seinfeld’s management company.

Kevin Spacey: Film and stage actor Kevin Spacey was able to recover the domain name www.kevinspacey.com from notorious cybersquatter John Zuccarini. The panel found that Kevin Spacey had long-standing common law trademark rights in his name, which had acquired secondary meaning. (NAF Claim No: FA0103000096937)

Stevie Wonder: Stevland Morris a/k/a Stevie Wonder was successful in a domain name action to reocver www.steviewonder.com based on his United States and foreign registered rights in the STEVIE WONDER trademark. (NAF Claim No: FA0504000453986)

Tiger Woods: Tiger Woods succeeded in recovering the domain name www.tigerwoodslifestyle.com based on his United States registered trademark TIGER WOODS. (NAF Claim No: FA0902001245906)
The Big Business Of Selling Domain Names
Domain names are big business. For the past several years, domain names, the “real estate of the Internet,” have generated substantial returns for savvy investors, who often refer to themselves as “domainers.” Prior to the rise of pay-per-click advertising, domain name speculators would acquire desirable or trademarked domain names and then simply sit on them, hoping that they could sell them later on for a profit.

Today, a domain name holder can display pay-per-click advertising on a website, and sit-back and let the money roll in while Internet users click on those ads. A single domain name can bring in hundreds of dollars a day, and many domain name holders have thousands or even millions of domain names.

The ability of a domain name to generate money through pay-per-click advertising depends on the likelihood that users will type in that domain name. As such, a domain that is a common word or phrase, or which incorporates a well known trademark, can draw in a constant stream of Internet users. In order to make money from a domain name, only a fraction of the Internet users who type in a domain name need to click on an ad. Each click can bring in anywhere from a few cents to a few dollars.

As a result of this business model, the value of desirable domain names has skyrocketed. Domain names can routinely fetch five or six figures. And in 2007, the domain name porn.com, reportedly sold for $9.5 million. The following domain names also reportedly fetched over a million dollars: business.com, asseenontv.com, altavista.com, wine.com, creditcards.com, and autos.com.

An entire secondary industry has developed around the buying and selling of domain names, including a vibrant online auction process for domain names. Several companies now offer appraisal services for domain names; the appraisal can cost anywhere from $10 to $100. Companies like Sedo and SnapNames hold domain name auctions, and serve as conduits for the sale of domain names, and enjoy a hefty commission for their assistance.

“Domaining” is big business, and cybersquatting is not a petty crime. Rather, cybersquatting can involve substantial money and serious legal claims. Accordingly, trademark owners must be proactive in policing the misuse of their trademarks by cybersquatters. The failure to do so could result in substantial losses, as the above numbers reveal.
Domain Name Tax & Accounting Issues
Because it has now become common to spend five or six figures to acquire a valuable domain name, certain tax issues have reared their head. Unfortunately, these tax questions are not always so easily answered. For example questions arise as to whether income generated from a domain name should be treated as capital gains or ordinary income? Likewise, if, and how, does one amortize the expense of acquiring a domain name? And does a domain name depreciate in value over time?

Those who invest in, and generate income from domain names, should contact qualified tax professionals with experience in Internet law, to assess their tax consequences.
Glossary
Anticybersquatting Consumer Protection Act: A federal law of the United States, which makes it unlawful for a person to register a domain name containing another person’s trademark with bad faith. Sometimes ACPA is simply referred to as the Cybersquatting Act, though this is a vague phrase.

Cease-and-Desist Letter: A pre-litigation letter demanding the recipient to cease a particular course of conduct. In the context of cybersquatting, a cease-and-desist letter typically demands the recipient to cease using a particular domain name.

Cybersquatting: The bad faith registration of an Internet domain name containing another person’s trademark or containing a confusingly similar variation or permutation of another person’s trademark.

Cybersquatter: One who engages in cybersquatting, i.e. or the bad faith registration of an Internet domain name containing another person’s trademark or containing a confusingly similar variation or permutation of another person’s trademark.

Domain Parking: An advertising practice used by domain holders to monetize type-in traffic to an undeveloped website. A parked website displays advertisements, which when clicked upon, generate income for the domain holder.

Domain Tasting: The practice of a domain name registrant using the five-day grace period at the beginning of the registration of a domain to evaluate the marketability of the domain name.

ICANN: Internet Corporation for Assigned Names & Numbers created in 1988 to manage the assignment of domain names and IP addresses, among other Internet governance activities.

In Personam: A term used to designate judicial proceedings instituted against a person. In personam jurisdiction refers to the power of a court over a person.

In Rem: A term used to designate judicial proceedings instituted against a thing, in contrast to actions against a person.

Phishing: A criminal process used to acquire sensitive personal information, such as credit card details, account numbers, and passwords, by masquerading as a trustworthy website or electronic communication.

Registrant: A person who has registered a domain name with an accredited ICANN registrar.

Registrar: A company that has been accredited by ICANN to register domain names.

Top Level Domain (TLD): The last part of an Internet domain name (i.e. the letters that follow the final period in a domain name). In the domain name www.example.com, the top-level domain is com.

Trademark: A word, name, symbol or device which is used in connection with goods to indicate the source of the goods and to distinguish them from others’ goods.

Typosquatting: A form of cybersquatting, in which the registrant of a domain name relies on Internet users making typographical errors when entering a domain name into a web browser’s URL field.

UDRP: Short for the Uniform Domain-Name Dispute-Resolution Policy, the UDRP is an ICANN policy that provides an arbitration procedure for trademark owners to recover a domain name from persons who have registered the domain name in bad faith. UDRP is a distinct and separate procedure from a lawsuit brought under the Anticybersquatting Consumer Protection Act.

URL: A Uniform Resource Locator—A protocol for specifying an address on the Internet. A URL can be thought of as the address of a web page, and is sometimes referred to as a web address.