Overview of IPR

Enforcement UNIT 3 ACTIONS AND REMEDIES FOR

INFRINGEMENT
Structure

3.1 Introduction
Objective
3.2 Civil Proceedings
3.3 Criminal Proceedings
3.4 Administrative Procedure
3.5 Evidential Aspects
3.6 Remedies for Infringement in Specific IP Instruments
3.7 Technological Measures to Prevent and Detect Infringement
3.8 Summary
3.9 Terminal Questions
3.10 Answers and Hints

3.1 INTRODUCTION
The remedies in cases of infringement of intellectual property rights are available
through action in three channels: civil procedure, criminal procedure and
administrative procedure. In addition to these there are always technological measures
that the owner of IP can employ to minimise, if not eliminate, the possibilities of
infringement of his IPRs, and detect the incidence of infringement. The TRIPS
Agreement, Part III (Article 41 to 61) deals with the enforcement of intellectual
property rights. Members of the WTO have the general obligation to provide under
their law enforcement procedures to permit effective action against any act of
infringement of IPRs. The remedies should be expeditious and deterrent to further
infringements. The procedures should not create barriers to legitimate trade and
provide for safeguards against their abuse; they should be fair and equitable and not
unduly costly or complex; there should be no unreasonable time limits or undue
delays. The last two qualifications are important because the effectiveness of the IPR
depends on whether they could be speedily enforced and with low cost. The TRIPS
also lays down other requirements for enforcement process: right to be heard and give
evidence; right to have a prompt, reasoned, written decision; judicial review, written
notice of claims, legal representation; protection of confidential information;
discovery of information held by the other party; and indemnification against abuse of
enforcement procedure.
Objectives
After studying this unit, you should be able to:

• understand the action-options available to an owner of IPR aggrieved by

infringement;
• know some special evidential aspects in cases of infringement of patents and
trademarks; and
• know the remedies available under different options.

3.2 CIVIL PROCEEDINGS

The three issues that need to be considered are:

• Who could initiate proceedings in a case of infringement of industrial property

(the plaintiff)?
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• Against whom the proceedings can be initiated (the defendant)? Actions and
Remedies for
Infringement
• Which court will have the jurisdiction to try the case (the Court)?
Who can Initiate Proceedings?

Clearly the owner of the IPR is the aggrieved party if infringement of his IPR takes
place and he is to initiate the proceedings as the plaintiff. If the IP is a patent or a
trademark an exclusive licensee also can initiate proceedings.

The Defendant

You have read in the previous Unit what constitutes infringement in the case of a
specific category of IP. A person who commits an act of infringement becomes the
‘defendant’, if the plaintiff brings infringement proceedings for such an act of
infringement. Additionally, anyone else who may join the infringer in a common
design to perpetrate the act of infringement will also be jointly liable to be sued. The
liability is, however, to be judged in relation to the territorial jurisdiction. If a person,
outside the jurisdiction of a country’s courts, supplies a protected article to a party
again outside the jurisdiction, he is not guilty of infringement. But if he is working in
a common design with a person who resides within the jurisdiction and commits the
infringing act, the first person in this case jointly shows the liability with the infringer.

If an employee attracts tortuous liability, his employer is also vicariously liable for
torts. However, a person, commissioning work from an independent contractor does
not carry such vicarious liability.

The Court

National laws clearly specify, the court which will be competent and have jurisdiction
in relation to a case of infringement. The issue of jurisdiction becomes complex in
cases involving international aspects in a case of infringement.

An interesting question relating to enforcement of IPR in the context of global

commerce pertains to the legal jurisdiction of a court where the case for a violation of
IPR should be initiated. The difficulty arises when the parties to litigation belong to
different countries. Such situations are becoming quite common as technological
capabilities advance, globalisation becomes universal and e-commerce becomes
common. Different countries have different laws. The course, outcome and costs of
litigation may significantly depend on where the case is contested. Novell, a US
computer software firm, sued its distributor in South Korea, in a court in Utah, USA
for infringement of copyright and trademark though the cause of action arose in the
Republic of Korea.

Besides IP laws, redressal can in certain cases be available under common law
liability for economic torts, particularly passing off and injurious falsehoods.

Civil Procedure

A Civil Court can provide a wide range of relief in a case of infringement of property.
The relief can be in the form of an injunction, or damages or account of profits, or
otherwise (other relief).

Injunction is a prohibitory relief to stop the infringement. The court may direct the
defendant not to do certain acts. Such direction may come at the end of a trial in
which the complaint of the owner of the IP that his rights have been violated has been
upheld. In such case the injunction is called final. However, in a civil action, there can
also be an interim, interlocutory injunction, which is meant not to enforce an

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Overview of IPR established right but to maintain the status quo till the proceedings are complete.
Enforcement
Interlocutory injunction makes the IPR regime very effective.
Damages are meant to compensate the owner of the IP for the loss in money terms
suffered by him due to infringement of the IPR.

‘Accounts’ relates to the account of net profits earned by the defendant (infringer) due
to infringement. If there are no profits, there is no award of ‘Accounts of Profit’ as
relief. The account of profit is not a punishment, it only aims to deny the infringer
unjust enrichment at the cost of the owner (or licensee) of the IPR. Damages and
Accounts are alternative remedies; the plaintiff can choose only one of them, not both.

Civil action can offer remedies also for acts which are themselves not infringement
but may be preparatory for completing the infringing act e.g. supplying part for
illegally making a patented invention, or consequential to an illegal act e.g. importing
or marketing infringing goods. In such ‘secondary’ acts the liability is dependent to a
great degree on whether the defendant knew that infringing goods were involved.

‘Otherwise’ as a remedy is a general provision which authorises the court to grant

such other reliefs as it may deem necessary for complete redressal of the complaint.

‘Delivery up’ is a provision to make injunction effective. The court ordering

injunction may in its discretion order delivery up of infringing articles/documents for
destruction by the defendant. If the case pertains to the infringement of a trademark
the equivalent order may require erasure of trademark. In the case of a copyright
work or an unregistered design, the order may extend both to infringing copies and to
the apparatus that is specifically designed to make them.

Recourse to civil proceedings in cases of IP infringements is on the rise. In many

cases, civil courts have awarded substantial damages. For example, the award in the
Polaroid vs. Eastman Kodak case was US $873 million, and in the Smith International
vs. Hughes Tools, US $204 million.

The civil procedure may come to the help of the owner of the IPR in securing
evidence of infringement through what is generally known as Anton Piller Order and
Mareva injunction. These have already been discussed in Unit 1, Section 1.5. An
Anton Piller Order from a competent Court authorises a plaintiff, after a hearing in
camera for pre-trial relief in the form of a search order of the defendant’s premises,
with some safeguards for liberties and prevention of abuse, for discovery of
incrementing material or documents. The Mareva injunction directs the defendant to
retain the infringing material.

The experience with the enforcement of patent rights shows wide variation from
country to country in terms of complexity of the proceedings, duration of a case in
courts and the cost of litigation.

The patent infringement cases are full of technical complexities and receive divergent
interpretations at different courts. The USA has established in 1982 the United States
Court of Appeals for the Federal Circuit to deal with the issue of complexity in an
attempt to provide uniform interpretation of patent claims.

The present efforts seek a negotiated resolution of the international jurisdictional issue
by adopting the Hague Convention on Jurisdiction and Foreign Judgments in Civil
and Commercial Matters.

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SAQ 1 Spend " Actions and
Remedies for
5 min. Infringement
Mark the statements as true (T) or false (F):
i) The TRIPS Agreement requires remedial procedures for infringement to be
simple, not costly, and quick.
ii) The defendant in a case of infringement is one who has to defend his IPR.
iii) A person in India, supplying an article protected by a UK patent to a person in
UK, can not be held guilty of infringement, as IPRs have territorial limitation.
iv) A person held guilty of infringement of IPR in a civil suit can be awarded a prison
term.

3.3 CRIMINAL PROCEEDINGS

The penalties for infringement in a criminal case are tougher than in civil proceedings.
Criminal penalties involve a real prospect of imprisonment for a substantial term.
Thus recourse to criminal proceedings, in a case of infringement of IP, can be more
effective and have more of a ‘deterrent value’ than a case under civil proceedings.
However, the standards to prove a liability in a criminal action are more stringent than
in a civil suit.
But a criminal suit has no immediate, pre-trial, or interlocutory remedies like
injunction or even remedies like permanent injunction and damages. The remedial
action has to wait for the outcome of criminal proceedings. The civil remedies have a
greater appeal in business community than punishment by state as in a criminal action.
The legal framework and guidelines provided under the TRIPS Agreement aim at
making enforcement of IP in criminal proceedings more effective. Recourse to
criminal proceedings in cases of violation of IPR is becoming more popular. Several
countries have made criminal proceedings more effective and pursue infringement of
IPRs with seriousness. In Malaysia, Business Software Alliance assists the
government in fighting software piracy. Penalties include imprisonment up to 5 years,
China, Hong Kong, Singapore, India are all on hot pursuit of counterfeiters and
pirates. Establishments raided include largely those producing auto-parts, fake
medicines, music CDs/cassettes, books etc. and large stocks of counterfeit and pirated
goods have been seized. An interesting development in the administration of law
pertaining to the violation of IPRs is seen in Thailand. As the IPR law is highly
complex and requires specific knowledge for competent interpretation, needing
specially qualified judges, Thailand has set up a Central Intellectual Property and
International Trade Court with exclusive jurisdiction in both Civil and Criminal
matters relating to enforcement of IPRs.
Criminal proceedings can be initiated by officers of the State.

3.4 ADMINISTRATIVE PROCEDURE

Apart from court, administrative agencies can and do take effective steps in case of
violation of IPRs. Such action may include seizing infringing goods at the borders by
customs authorities; confiscation of offending goods by excise authorities; action by
appropriate authorities to test quality and standards etc. Administrative actions to stop
infringement have high visibility.
Customs authorities play a notable role in administrative enforcement of IPRs at
national borders by seizing infringing goods if the owner of the IPR notifies the
Commissioner of Customs and Excise that an incoming consignment is violative of
his IPR, usually a copyright or a trademark, and needs to be confiscated to uphold his
legal right. In 2001, 95 million counterfeit articles were seized at the EU borders.
Administrative enforcement through seizure at borders faces difficulty in several
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Overview of IPR countries as customs authorities are generally ill-equipped to handle IP matters; such
Enforcement
matters may often not be receiving high priority in customs policy. Absence of
reliable data-bases to support legal enforcement of IPRs, particularly in trademarks, is
an impediment for quick action.

" Spend SAQ 2

5 min.
Mark the statements as true (T) or false (F);
i) Business community prefers criminal law suits to civil law suits in cases of IP
infringement as tougher penalties are awarded in criminal proceedings.
ii) Injunction as a remedy in a case of infringement of IP is available in criminal
proceedings.
iii) Customs authorities can seize a consignment of goods, infringing IPR, at the
border of a country at the request of the IP owner.
iv) Administrative action by excise authorities and authorities to test quality and
standards is helpful in curbing infringement of IPR.

3.5 EVIDENTIAL ASPECTS

Some evidential aspects relating to infringement of a patent and a trade mark need to
be noted.
Patent – Infringement
If it is a product patent, the burden of proof lies on the plaintiff. He has to furnish
evidence to convince the court that on a balance of probabilities the defendant has
infringed the patent.
If it is a process patent for obtaining a product it is for the defendant to prove the
process he has been using to obtain an identical product is different from the patented
process.
It may be necessary, in view of the technical complexities involved in an invention
and the technical language used in specification and claims to call experts, to give
evidence, as to the state of art in a field or the meaning of a technical term, and
whether in his opinion a skilled worker can carry out the invention as described in the
specification. However, it is not for the expert to say what the specification means or
whether a particular step is obvious.
Trademark Infringement

• If a challenge to a trademark has been mounted on the ground of non-use, or if the

owner claims that the trademark has acquired distinctiveness through use, the
burden of proof lies with the proprietor of the trademark.
• Registration of a trademark is prima facie evidence of its validity, as regards its
ownership.
• Evidence may come from people in the trade (wholesalers, retailers), experts, and
even market surveys though they may not carry much weight.

3.6 REMEDIES FOR INFRINGEMENT IN SPECIFIC IP

INSTRUMENTS
Patents
Remedies available are: injunction (interlocutory as well as final), damages or account
of profits, an order of delivery up, declaration of validity of patent and the fact of its
30 infringement by the defendant.
Trademarks Actions and
Remedies for
Remedies are: injunctions, damages or accounts, or otherwise; as order of delivery up Infringement
which may be subject to limitation of time.
Industrial Designs
Remedies are normally injunctions and damages. However, damages may not be
awarded if the defendant succeeds in showing that he was not aware, and had no
reasonable ground for supposing that the design was registered.
It may be noted that national laws may contain remedies against groundless threats of
infringement proceedings from the owner of the design by means of advertisements,
or publication of views, or circulars, or otherwise.
Semiconductor Layout-Design and Geographical Indicator
Infringement attracts punishment with fine or imprisonment or both.

3.7 TECHNOLOGICAL MEASURES TO PREVENT AND

DETECT INFRINGEMENT
Besides the remedies and mechanism of IP enforcement considered so far – Civil and
Criminal Proceedings and Administrative Procedures – which envisaged active role of
the government in enacting enabling legislation and rules and regulations and in
putting in place an effective institutional infrastructure, the concerned owner can
always devise or use technological means to make counterfeiting and copying
difficult. This serves the owner of the IPR by protecting his economic interest. It also
tends to save the customer from buying ‘fake’ goods (and pirated copies of books,
films, music cassettes, software programmes etc.). Since technology places a powerful
tool in the hands of counterfeiters and copiers, it can also be an apt means to counter
these efforts. In any case, it could create measures to counter the evil with speed as
effecting change in national legislation, or developing international understanding, is a
slow and tedious process.
Technological means to counter infringement of IPRs have acquired particular
importance since the advent and growth of internet, and in its wake, of e-commerce.
To fight piracy in cyber-space, it is necessary to develop technologies that make
copying difficult and easy of detection. Technological means should increase the risks
of the infringers: it should be difficult for them not to get caught and punishment
should be heavy, that should serve as an effective deterrent.
Governments can help technological enforcement by providing legal protection and
effective remedies if someone tries to circumvent technological measures which a
right-holder employs for protection of IP and enforcement of IPRs.
The more common technological methods deployed for IPR enforcement are based on
optical technology and electronic technology. They are briefly discussed. Some
measures based on biotechnology and chemical technology have also made their
appearance.
Holograms are the most widely used optical measures. A hologram is a two-or three-
dimensional device which reflects an image, sometimes associated with some
movement. Copying a hologram is very difficult and costly.
Several electronic devices are available e.g. the magnetic strip as the one on a credit
card which stores a large amount of coded data, readable with a scanner; the smart
card, incorporating a computer chip which can carry a large amount of data upon
access; encryption, where electronic signal is scrambled, but is readable through an
authorised key.
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Overview of IPR
Enforcement 3.8 SUMMARY
• Remedies in cases of infringement of IPR can be available through action in three
channels, viz. civil proceedings, criminal proceedings and administrative action.
Also, one should take technological measures to prevent and detect incidence of
IP infringement.

• In a litigation on IP infringement, there is the plaintiff (who is the owner or the

licensee of the IPR which is infringed), the defendant (who is the person accused
of committing the alleged infringing act) and the Court, which has the jurisdiction
in the case and where the trial is conducted.

• In a civil case, the plaintiff can seek as relief, injunction (including interim
injunction), damages or alternative account of profit, delivery up, or otherwise.
Even pre-trial relief can be given on court’s satisfaction. Civil suits do not award
imprisonment.

• In a criminal case penalties are tougher than in a civil case. Imprisonment is a real
possibility, but the standards to prove a liability in a criminal action are more
stringent than in a civil case. In a criminal case there is no pre-trial or interim
relief or even damages available. One has to wait for the final outcome of the
proceedings. As businessmen are generally considered with prompt relief and
recovery of damages, civil proceedings remain the favoured option, though
criminal proceedings have more inbuilt deterrence.

• Administrative action can be taken to stop import of infringing goods at the

border, if the owner of the IP requests the customs authorities for it. Excise
authorities and authorities to test quality and check standards also play useful role
in containing infringement activity.

• Some evidential aspects need to be noted. If the infringement pertains to a process

patent it is for the defendant to prove that the process he has used to obtain an
identical product is different from the patented process. This is the reversal of the
burden of proof, as normally the plaintiff is required to prove his charge. In
trademark infringement evidence may come from the trade (wholesalers, retailers,
etc.) and market surveys.

3.9 TERMINAL QUESTIONS Spend 10 min.

1. The infringer may be sent to jail in criminal proceedings and this has large
‘deterrent effect’. However, civil procedure remains a favourable option with
business community. Why? Discuss.

3.10 ANSWERS AND HINTS

Self Assessment Questions
1. i) T ii) F iii) F iv) F
2. i) F ii) F iii) T iv) T
Terminal Questions
1. Refer to Sec. 3.3 and 3.8.

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