Piracy of Registered Designs: Grounds of Defence and Passing Off

This article discusses the piracy of registered designs and the practice of pleading invalidity of registration without an application for cancellation and remedies.

Section 22(1) of The Designs Act, 2000 provides for what would constitute Piracy of Registered Designs. Section 22(2) of the Act provides for the punishment in case an offence under Section 22(1) of the Act is made out.

On the other hand, Section 22(3) of the Act provides a defence to “any person” (i.e., both plaintiff and defendant) by questioning the validity of registration under Section 19 of the Act. This article dwells into an in-depth discussion on Section 22 of the Act regarding piracy, pleading invalidity without cancellation and the remedies associated with the same.

Introduction

Section 2(d) of The Designs Act, 2000 defines “design” as

“only the features of shape, configuration, pattern, ornament or composition of lines or colours applied to any article whether in two dimensional or three dimensional or in both forms, by any industrial process or means, whether manual, mechanical or chemical, separate or combined, which in the finished article appeal to and are judged solely by the eye; but does not include any mode or principle of construction or anything which is in substance a mere mechanical device,

and does not include any trademark as defined in clause (v) of sub-section (1) of Section 2 of the Trade and Merchandise Marks Act, 1958 (43 of 1958) or property mark as defined in Section 479 of the Indian Penal Code (45 of 1860) or any artistic work as defined in clause (c) of Section 2 of the Copyright Act, 1957 (14 of 1957)”.

Design Protection

In furtherance of the TRIPS Agreement, it is an obligation for the members to provide for the protection of independently created industrial designs that are new or original^[1].

In India, The Design Act, 2000, provides for having a monopoly over such a design for a statutory period. Only after expiry of the aforesaid statutory period, inventions and improvements go into the public domain and could be made freely available for public use but till then the inventor or the registered owner of the design have a monopoly over the said design in terms of the provisions of the Design Act^[2].

In India, the law of passing off is provided for under the Common Law Rights. Passing off action is also available to the case of design and such right could be enforced provided the same is available in accordance with law even in a case of design, for otherwise a latitude would be given to a manufacturer to misrepresent and to deceive unwary customers by manufacturing and selling its products as that of products of some other manufacturer or seller.^[3]

Piracy of Registered Designs

Section 22(1) of the Design Act, 2000 lays down three situations which will be labelled as Piracy of Design. During the existence of copyright in any design, it shall not be lawful for any person to do the following:

1. for the purpose of sale to apply or cause to be applied to any article in any class of articles in which the design is registered, the design or any fraudulent or obvious imitation thereof, except with the license or written consent of the registered proprietor, or to do anything with a view to enabling the design to be so applied; or
2. to import for the purposes of sale, without the consent of the registered proprietor, any article belonging to the class in which the design has been registered, and have applied to it the design or any fraudulent or obvious imitation thereof; or
3. knowing that the design or any fraudulent or obvious imitation thereof has been applied to any article in any class of articles in which the design is registered without the consent of the registered proprietor, to publish or expose or cause to be published or exposed for sale that article.

Section 22(1) of the Act, defines what constitutes piracy of a registered design. Under the Act, use of either registered design or a fraudulent or obvious imitation thereof by defendant amounts to an act of piracy and/or infringement.

Sub-section (1) of Section 22 of the Act prohibits what cannot be done in law by ‘any person’ during the existence of copyright in any design of a registered proprietor as provided in sub-clauses (a), (b) and (c) of Section 22 of the Act without the consent of the registered proprietor of such design. This shows that the infringement has to be of a registered design only.^[4]

Sub-section (2) of Section 22 of the Act provides that if ‘any person’ acts in contravention of Section 22 of the Act, he shall for such contravention face the consequences viz. payment of damages, and an order of injunction from repeating such infringement as set out in clauses (a) and (b) and the proviso to sub-section (2) of Section 22 of the Act.

Grounds of Defence

Section 22 (3) of the Act reads that “In any suit or any other proceeding for relief under subsection (2), every ground on which the registration of a design may be cancelled under section 19 shall be available as a ground of defence”. Sub-section (3) of Section 22 of the Act also provides that in any suit or any other proceedings for relief under sub-section (2), every ground on which the registration of a design may be cancelled under Section 19 shall be available as a ground of defence.

Section 19 of the Act provides that any person interested may present a petition for the cancellation of the registration of a design at any time after the registration of the design to the Controller on any of the following grounds, namely:

• that the design has been previously registered in India; or
• that it has been published in India or in any other country prior to the date of registration; or
• that the design is not a new or original design; or
• that the design is not registrable under this Act; or
• that it is not a design as defined under clause (d) of Section 2.

Earlier, the position related to Section 22(3) was that “In a suit for infringement of design, the Defendant can challenge the validity of the Plaintiff’s registration as provided for under Section 22(3) of the Act on the grounds provided in Section 19 of the Act, the Plaintiff cannot invoke Section 22 of the Act to challenge the validity of a Defendant’s registered design and such an interpretation would be contrary to the object and intent of the Legislature in introducing Section 22(3) of the Act.

In fact, the statement of objects and reasons (clause (n) clearly states that the bill “contains provisions for grounds of cancellation to be taken as defence in the infringement proceedings to be initiated in any court, not below the court of the District Judge”. To argue that the word ‘defence‘ in Section 22(3) means “defence” also available to the Plaintiff (when the Defendant challenges the Plaintiff’s registration in the infringement proceedings) is untenable^[5].

Therefore, under Section 22(3) of the Act, it is only the validity of the Plaintiff’s registered design which can be challenged as and by way of defence and not the Defendant’s registered design which can only be challenged by proceedings under Section 19 of the Act before the Controller^[6].

The court in case of Whirlpool of India Ltd. v. Videocon Industries Ltd^[7] explained that “the Plaintiff’s point of view, the exclusive right which a registered proprietor can claim against “any person” and on the strength of which he can claim relief under Section 22 against such person, is itself subject to the restriction contained in sub-section (3) of Section 22, namely, the Plaintiff-proprietor’s registration should not be liable to be cancelled under Section 19 of the Act.

If it is held to be so liable, that is a complete defence to the Plaintiff-Proprietor’s action for claiming relief under Section 22. Equally would the provisions of Section 22, a restriction on the Defendant-Proprietor’s exclusive right to apply his registered design to his articles.

The Defendant-proprietor would have a complete defence to the Plaintiff-Proprietor’s action only if his (the Defendant’s) registration is prior in point of time since such prior registration is a ground for cancellation of the Plaintiff’s registration.

A Defendant proprietor, who holds a subsequent registration cannot plead his subsequent registration in defence to an action under Section 22, since a subsequent registration is no defence within the meaning of Section 22(3) read with Section 19. That is an obvious consequence of Section 22 from the defendant’s point of view.

Just as a Plaintiff cannot claim a right to relief under Section 22 against a prior registered proprietor on the basis of his (the Plaintiff’s) registration, the defendant cannot successfully defend an action under Section 22 by a prior registered proprietor on the basis of his (the defendant’s) registration. That clearly appears to be the scheme of the Act.

This Scheme is not only based on sound reason and common sense but is perfectly in consonance with the very nature of a copyright claim in a design. It, therefore, cannot be argued that Section 22(3) has implications only for the Plaintiff’s registration and not for the Defendant’s registration.

The Court may consider both the Plaintiff’s and the Defendant’s registrations in the light of Section 22(3) and grant or reject the relief to a Plaintiff depending on whose registration is prior in point of time.

Upon such determination, the decision may have to be sent to the Controller, who shall cause an entry to be made accordingly in the Register qua the Plaintiff’s or the Defendant’s registration, as the case may be”. Hence, both Plaintiff and Defendant can take recourse of Section 19.

Passing Off

In the light of what has been discussed above, it is imperative to discuss the test of passing off and in this regard, the Hon’ble Bombay High Court in Cello Household Products and Others v. Modware India and Others laid down the foreground for testing whether an action constitutes ‘Passing off’ or not.

It was observed by the Hon’ble High Court that “in any Passing off action, the Plaintiff must satisfy all three probands of so-called Classical Trinity:

1. reputation and goodwill in goods;
2. misrepresentation by the Defendants; and
3. damage.

It is not a requirement of law in infringement or passing off in relation to a design that every single aspect must be entirely newly concocted and unknown to the history of mankind. It is a general rule that “mosaicing” of the prior art, i.e., combining selected features in different prior art publications, is not permissible when assessing whether an invention is new. Conversely, mosaicing is also no defence to a charge of infringement of a registered design. Mosaicing contemplates taking known integers or combinations and simply rearranging them.”^[8]

Conclusion

Protection of the design infringement law in India is the need of the hour; clearer review in the registration of design and more precisely the laws related to the protection of registered design proprietors, including deterrent remedies like stringent fines.

Further, the Design Office needs to review its examination procedure and ensure novelty searches when the applicants are granted a right. The Design Office needs to improve its e-filing initiative and make design records available online. The prior art search up to most extent can be useful for limiting the cases of design infringement in India.

As in the cases of Patent, every inventor wishes to first go for prior art search so that the risk of infringement can be minimised, in the same way, a proper search system should be created in the Industrial design system in India. Within the existing legislative framework, courts in India assist in maintaining the rights of the registered proprietor and in ensuring clear observation of the law.

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^[1] Article 25.1 of the TRIPS Agreement

^[2] Smithkline Beecham Plc. And Ors. v. Hindustan Lever Limited And Ors, 2000 (52) DRJ 55

^[3] Tobu Enterprises Pvt. Ltd. v. Joginder Metal Works And Ors, ILR 1983 Delhi 451

^[4] Whirlpool of India Ltd. v. Videocon Industries Ltd., MANU/MH/0639/2014

^[5] Garikapati v. Subbhiah Choudhary, MANU/SC/0008/1957, M/s. East India Corporation Ltd. v. Shree Meenakshi Mills Ltd., MANU/SC/0265/1991, Premier Automobiles Ltd. v. Kamlekar Shantaram Wadke, MANU/SC/0369/1975.

^[6] Whirlpool of India Ltd. v. Videocon Industries Ltd., MANU/MH/0639/2014

^[7] Id.

^[8] Cello Household Products and Others v. Modware India and Others, 2017 (72) PTC 367 (Bom)

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1. Designs Law in India: Introduction, Meaning and Case Laws
2. Law Relating To Piracy Of Designs In India