HARNESSING INTELLECTUAL PROPERTY RIGHTS FOR BUSINESS GROWTH

BY TA. SRINIVASEN B.Com, B.L., M.L., P.G.D.L.A., M.B.A., F.C.S., A.C.I.S (UK) Senior General Manager Legal / Head Legal Dalmia Cements (Bharat) Limited Chennai 98408-00487, ta_sriniv@yahoo.co.uk, srinivasenta@gmail.com

HARNESSING INTELLECTUAL PROPERTY RIGHTS FOR BUSINESS GROWTH Intellectual Property Rights plays a crucial role in the existence and growth of Business enterprises. Intellectual Property Rightsmay take the form of Trade Marks, Patents, Copyrights, Designs, Trade Dress, Confidential Information and Domain Names. All the information which is confidential and proprietary in nature also comes within Intellectual Property Rights. Many Enterprises are still unaware of managing their Intellectual Property Rights so as to harness the same, for their Business Growth.

We shall go through the various species of Intellectual Property Rights, one by one and see how its helps and aids Business Growth.

(i)

Trademark: Many consider Trademarks out of the ambit of Intellectual Property Rights,

since they do not contain any intellectual value add. However, Trademarks are always considered one of species of Intellectual Property Rights throughout the world. Trademarks may mean to include device, brand, heading, label, ticket, name, signature, word, numeral, shape of goods, packaging or combination of above or any combination thereof. When a Trademark/ Brand isvery successful, we find there are number of look-alikes which is floated in the market by unscrupulous people to ride on the goodwill and equity created by its original owner. When a Trademark resembles the existing Registered Trademark, than it is said to Infringe the original mark. On the other hand if a Trademark resembles an unregistered Trademark it would be termed as Passing Off. If these infringers are allowed to go scot free then, the original Trademark owners goodwill and equity will be diluted and someone might enjoy the brand image created by such original owners over the years. The net effect is, many existing customers of the original Trademark owners may likely to shift their allegiance to such deceptive/infringing Trademark products. This will hit the enterprise commercially and may also create confusion in the minds of the customers, Therefore it is necessary to take variety of action to prevent the infringers/or persons indulging in passing offs.

The action that could be initiated may be either (a) Civil Proceedings or (b) Criminal Proceedings. (a) Civil Proceedings may take the form of getting prohibitory injunction against the user and

seek the appointment of an advocate commissioner to seize the impugned goods. The prayer or relief sought may includepenalty, compensation for loss of profits and such other remedies.

(b)

On Criminal Proceedings may take the form of filing a complaint with the police authorities.

It is always better to file a complaint with the Police authorities, if the Trademark has a Registration Certificate issued by the Registrar of Trademark, this would facilitate the police authorities to appreciate the same and act faster.Suppose if an Organization chooses to remain silent and does not want to take any action, and then later the original Trademark owner may lose the right of taking action on account of latches viz. time delay. So a Trademark to enjoy better protection ought to be registered and also put into use. For registered Marks, an archive has to be created to ensure that all the Invoices, Publicity Materials, Copies of the Advertisement, Hoarding Photographs and all other materials evidencing the use of the Trade Mark has to be preserved for demonstrating its usage. The following 10 Commandments of Strong Trademark tells upon the factors necessary for a solid Trade Mark for better protection and management:

1. Coined / Distinctive Words are always a better bet in selection of an ideal Trade Mark. 2. A Trade Mark which comprises of Common / Non distinctive / Dictionary / or any Laudatory Epithet, may not give Monopoly over the Mark & could invite costly Litigation. 3. It is always necessary to make a National Market Search / Survey, to overrule the Existence of the proposed Trade Mark ( A Global Search might also be necessary) 4. Though Trade Mark, gives territorial Monopoly, it always important not to use an Identical/Deceptive /Similar/Well Known / Sounding Marks as in existence in India / Abroad. 5. It is always necessary that a Legal Trade Mark Search is conducted in the Trade Mark Registry, in the respective / identical classes of the proposed Trade Mark, to overrule its existence. 6. Registration of a Trade Mark is NOT mandatory for its Usage. 7. Usage, Usage, Usage - The strength of the TM lies only on its Usage; Non Usage over a period may make the Trade Mark invalid, notwithstanding its Registration. 8. If a Mark is available for use, ensure Usage of the Mark for maintaining its Monopoly and also Registration immediately before the Trade Mark Registry, for extra protection. necessary that the Registered Mark has to be renewed without fail. 9. To prove the usage of the Trade Mark it is essential to maintain an Archive with respect to its Sales Figures, Advertisement & Publicity Expenses, Press Clippings, Copies of Hoardings, Advertisement, Recordings of Radio & Television Advertisement, Vouchers / Bills of the Trade Mark for use in the Legal Proceedings. 10. One should never hesitate to seek professional help, or else the mistake may be very costly. It is also

(ii)

Patents: Patents is an important Intellectual Property Right, where it denotes inventive

knowledge. Patent is a monopoly granted by law to exploit the invention made by an inventor for a specific period of time, say 20 years. This monopoly is nothing but a reward given to the patent holder, for his tireless efforts he has put in for his invention. Patent in order to be granted the process or product should be (a) Inventive (b) Innovative (c) Capable of commercial production (d) Not published or commercially exploited earlier. Patents in contrast to Trademarks can be rightly called as an Intellectual Property Rights since it is a realcreation of an Intellectual mind. Why Patent is necessary? As an individual or an organization I would have put enough money, time and efforts in inventing a product. In view of the same I have to be rewarded to exploit the same. How it harnesses the Business growth? When a Patent is granted to an inventor, the Patent holder has a monopoly right to exploit the itand put the invention into Commercial use. Not only that, the Patent holder has every right to prevent others from exploiting his invention. In the advent of technology, unscrupulous persons through reverse engineering process may try to unearth the process and also try to illegally exploit the patented invention. Thus a patent holder is endowed with the right to prevent the infringerfrom doing so. He can file an appropriate a petition before the Court seeking an ex-parte injunction against such person, who is illegally exploiting his invention. He can also call for the accounts statements for the product and even could seek damages and also share in his profits. To seek a prohibitory injunction it is necessary to demonstrate that an infringer has infringed the composition orthe process to his advantage and illegally benefited out of the invention. Patent litigation has assumed tremendous importance and now every business unit or enterprise would like to safe guard their patented rights. Further it is also necessary to take action immediately when the patent is infringed. By taking timely and effective action an enterprise could protect its market share/consumer and thereby even increase the revenues by even improving the existing patented product.

(iii)

Copyrights: Copyright is a legal right given to the creator of an original work an exclusive

right to it, for a limited time. It is a right given to an author for ones literary work, artistic work,

musical work, architecture, photography, cinematography, broadcast, painting, sculpture, newspaper, magazines and /or in combination of the same. Copyrights also play an important role in Business in harnessing its revenue. Copyright as mentioned, is also given to an artistic work. Business enterprises in addition to seeking registration under Trademarks Act for its artistic work can also seek registration under the Copyrights act too. The advantage in copyright is that the validity period is more than that of Trademarks. For violation of copyright in criminal action the police officer in the rank of the Sub-Inspector can take cognizance of the offence based on the Complaint filed by the original /licensed owner. While under Trade Marks Act, the Police Officer not below the rank of Deputy Superintendent of Police only is entitled to take cognizance of the offence.

If a Copyright is registered the same can be enforced in the Countries, which has signed the Berne Convention Treaty, which protects the literary / artistic works among them. By Registration and timely action against the infringerone can ensure that their Intellectual Property is not used by others un-authorizedly leading to loss of their legitimate revenue.

(iv)

Designs:TheDesigns Act only protects the features, if shape, in configuration, patterns,

ornaments or composition of a finished article, as its appeals and judged solely by the eye.The Designs Act provides exclusive copyright to apply a design to any article, in which the design is registered. Protection of designs is also very essential in business. When an Organizations design is very successful in relation to a package / product there may be many lookalikes of the same, who would like to illegally exploit the same as copy cats.The Designs Act thus helps and gives monopoly to the registered design owner for certain number of years to exploit the design. By doing that one can prevent others from copying and using the same design. Like Patents/ Copyright/ Trademarks the organization whose design is imitated/ pirated can initiate necessary proceedings under law and seek injunction and damages.

(v)

Trade Dress: Trade dress is not provided under any act in India. This is a new evolved

concept in US Courts and now being upheld even in Indian Courts.It refers to use of the colour scheme if a product knowingly on unknowingly in the same class of goods. Suppose a person, uses the colour scheme of another with a view to trade in the goodwill of another, then the affected person, can move to the Court for redressal for imitation of his/products trade dress. This was upheld in developed countries and now followed in Indian Courts too.

(vi)

Confidential Information:

Confidential Information could also be classified under

Intellectual Property Rights. To classify information as Confidential Information, such information should be really confidential and not available in the public domain. That is why we find many Corporates and Organizations take Non-Disclosure Agreement (NDA) from all employees to protect the confidential information.

Ifa Confidential Information is misused then the original owner can initiate proceedings before the court of law for injunction, return of confidential information and damages as the case may be.

(vii) Domain Names: Domain names can also be classified as Intellectual Property Rights. A person or organization which blocks / uses the domain names of the bonafide owners of the Trademarks are known as Cyber Squatters. These Squatters try to block the names of the big corporates and try to make money through a settlement of dispute. Therefore it is necessary to register their Domain names. If somebody illegally uses ones bonafide/original mark, action can be initiated through dispute redressal mechanism provided in World Intellectual Property Organization (WIPO). This organization is situated in Geneva and provides for on line dispute resolution against cyber squatters and proved to be fast/effective. From the above it is very clear that Intellectual Property Rights have an important place in todays Business. Further it is also necessary that Intellectual Property Rights has to be properly protected and managed. If the Intellectual Property Rights are not managed properly it would lead to loss of revenues and consequent depletion of organization growth. Thus by managing the Intellectual Property Rights effectively an enterprise can definitely maximize its revenue through better protection of its IPR Assets. The following steps will go a long way in protecting the IP Assets: Registration of Intellectual Property Rights will always be very useful. Monitoring the Markets for deceptive or similar marks is essential. Make web search periodically to ensure the original mark is not used illegally. Initiate action immediately on infringement or passing off. Be tough with counterfeit goods, since it may bring disrepute to the original owner and bring harm to the society due substandard quality of goods.

1) 2) 3) 4) 5)

By doing the above Intellectual Property Rights can be effectively used for Business Growth.