Prof. S.

Matilal
Fulbright Scholar
Law School, IIT Kharagpur
Journey from tangible to intangible
Great utilitarian philosopher Jeremy
Bentham in “Theory of Legislation”[P113]
“Property and law are born together, and die together.
Before laws were made there was no property; take away
laws, and property ceases.”
Importance of Institution of
Property
 The institution of property implies the existence of
ordered relations through establishment of norms.
 Normative order is essential for existence of any
institution including the institution of property.
 Norms are rules of conduct that prescribe behavioral
pattern of individuals towards each other.
Property as proprietary rights in
rem
 By property we understand the relation between the
property-holder in one hand and each and every
member of the society on the other hand in relation to
a tangible or intangible object.
 Law confers upon the property-holder a wide array of
rights (a bundle of rights) that allows the property
owner to maintain exclusivity.
Bundle of rights
(pack of sticks)
Infinite Series of Rights
R1,R2, R3, R4, ……. Rn
 Right to possess the thing which he/she owns
 Right to use and enjoy the thing owned
 Right to consume, destroy or alienate the thing
 Rights of residuary character
The New Wealth of Nations
 Primary focus of property
jurisprudence has shifted from
tangibles to intangibles.
 Intellectual Property Rights
are created by statues.
Intellectual Property- what does it
mean?
Intellectual property means the legal rights which result from
intellectual activity in the industrial, scientific, literary and artistic
fields. [WIPO]
NATURE

 Intangible: Intellectual property does not protect the physical

object that went into creation, but protects the intellectual
creation that underlie the physical object.
 Creation of Statute (Positive Law): Though intellectual property
had a common law origin, but now it is protected by national
legislations [Exception: Passing Off/Palming Off]
 Bundle of Legal Rights: Separable and Independent interests
that are recognized and protected by law.
Distinguishing Intellectual & Real
Property
Real Property Intellectual Property
 Protected by Possession  Cannot be Protected by mere
Possession
[Creations of mind, such as an idea
for an invention or a piece of
music, cannot like physical objects,
be protected against others’ use of
them by mere possession of the
object. Once the intellectual
creation is made available for the
public, its creator can no longer
exercise control over it. This
inability necessitated adoption of
intellectual property]
Public Goods Externalities
 Non-Exclusivity
 Non-Rivalarous
 Intellectual property is thus, a mechanism to
internalize the externalities.
Intellectual Property [Government’s
assignment of private property rights]
 Government by granting a bundle of private property
rights provide a legal entitlement for an intellectual
property owner to exclude others from enjoying
certain benefits of his/her creation.
 This creates:
 Incentive to invest
 Incentive to create
 Incentive to disclose and disseminate
TRIPS requires WTO members to
provide protection
 Patents
 Copyright (covers neighboring rights performers,
producers of sound recordings and broadcasting
organizations
 Trademarks
 Geographical Indications, including appellations of origin
 Industrial Designs
 Integrated Circuit Layout-Designs;
 New Plant Varieties
 Trade Secret (undisclosed or confidential information)
Real World to Virtual World
Intellectual Property in Cyberspace
 Cyberspace is the notional environment in which
communication over computer networks occurs.
 The emergence of internet, networking, and digital
communication have put the traditional doctrinal
understanding of intellectual property under serious
constrain.
 IP violation in cyberspace have serious impact
especially on copyright industry and trademark.
Copyright protects every form of expression in the literary
and artistic domain
Section 13(1) of the Copyright Act,
1957
Works in which copyright subsists.
Subject to the provisions of this section and the other
provisions of this Act, copyright shall subsist throughout
India in the following classes of works, that is to say,—
(a) original literary, dramatic, musical and artistic works;
(b) cinematograph films; and
(c) sound recordings
Literary Works
 Text Books, short stories, novels
 Any writings irrespective of their
 content (fiction or non-fiction)
 Length ( hundred page, one paragraph or just one line)
 purpose (amusement, education, information, advertisement
propaganda)
 Form (handwritten, printed, typed)
 Whether published or unpublished
 Computer program
 Tables and compilations including computer database
Dramatic Works
 any piece of recitation
 Choreography
 dumb shows (pantomimes)
Musical Works
(includes graphical notation)
 With or without accompanying words. (In India
accompanying words are protected as literary works)
 Classical or light
 Solo or chorus
Artistic work
 Two dimensional (drawings, paintings, lithographs)
 Three dimensional (sculptures, architectural works)
 Irrespective of content (representational or abstract)
and destination (pure art or for advertisement)
 Diagram, map, chat, plan
 Photograph
Cinematographic Film
Sound Recoding
The Bundle in Copyright Scenario
Section 14. Meaning of copyright.

For the purposes of this Act, "copyright" means the exclusive right subject to the
provisions of this Act, to do or authorise the doing of any of the following acts in respect
of a work or any substantial part thereof, namely:
(a) in the case of a literary, dramatic or musical work, not being a computer
programme,—
(i) to reproduce the work in any material form including the storing of it in any medium
by electronic means;
(ii) to issue copies of the work to the public not being copies already in circulation;
(iii) to perform the work in public, or communicate it to the public;
(iv) to make any cinematograph film or sound recording in respect of the work; (v) to
make any translation of the work; (vi) to make any adaptation of the work;
(vii) to do, in relation to a translation or an adaptation of the work, any of the acts
specified in relation to the work in sub-clauses (i) to (vi); (b)
Copyright provides a bundle of
exclusive economic rights to the owner
For Example:
to reproduce the work in any material form
to issue copies of the work to the public
to perform the work in public
to communicate the work to the public
to make any cinematograph film or sound
recording in respect of the work
to make any translation of the work
to make any adaptation of the work
Sound recoding, Cinematographic
Film
In the case of sound recording,—
(i) to make any other sound recording embodying it
including storing of it in any medium by electronic or
other means;
(ii) to sell or give on commercial rental or offer for sale
or for such rental, any copy of the sound recording;
(iii) to communicate the sound recording to the
public.
Explanation. For the purposes of this section, a
copy which has been sold once shall be deemed to
be a copy already in circulation. 15. Special
How Infringement (Violations)
Occurs?
Infringement occurs when someone without the
permission of the copyright owner does any of the
exclusive acts, which copyright owner alone can do.

Thus, photocopying a copyrighted book will amount to

copyright infringement as the exclusive right to make
copies of that book belongs to the copyright owner.
Section 51: When copyright
infringed
Copyright in a work shall be deemed to be infringed— (a)
when any person, without a licence granted by the owner of
the copyright or the Registrar of Copyrights under this Act or
in contravention of the conditions of a licence so granted or
of any condition imposed by a competent authority under
this Act— (i) does anything, the exclusive right to do which is
by this Act conferred upon the owner of the copyright, or (ii)
permits for profit any place to be used for the
communication of the work to the public where such
communication constitutes an infringement of the copyright
in the work, unless he was not aware and had no reasonable
ground for believing that such communication to the public
would be an infringement of copyright; or
Continuation
(b) when any person— (i) makes for sale or hire, or sells or
lets for hire, or by way of trade displays or offers for sale or
hire, or (ii) distributes either for the purpose of trade or to
such an extent as to affect prejudicially the owner of the
copyright, or (iii) by way of trade exhibits in public, or (iv)
imports into India, any infringing copies of the work
Provided that nothing in sub-clause (iv) shall apply to the
import of one copy of any work for the private and domestic
use of the importer.
Explanation. For the purposes of this section, the
reproduction of a literary, dramatic, musical or artistic work
in the form of a cinematograph film shall be deemed to be an
"infringing copy".
Secondary Copyright Infringement
 No legal system limits the ambit of liability of a wrong only to the party who personally
commits it, but in most jurisdictions there exists legal framework that extend the liability
to those who encourage, assist, facilitates, and harbours the wrongdoer or otherwise
gain from the wrongdoer’s act or omission.
 For example, Mr. X, during a demonstration that turned violent, encourages co-
participant Mr. Y to hurl bombs on the police. Though, Mr. X does not hurl any bomb
himself, but still he will be liable under law.
 Copyright is no exception to this general understanding. Copyright infringement liability
is also imposed on the person who provides means and becomes reason for the
infringement. Copyright in a work, thus, may be infringed either directly or indirectly.
Indirect or Secondary infringement liability arises when a person tacitly facilitates the
activities of the primary infringer or otherwise obliquely makes the infringement
possible. Along with the main infringer, liability is imposed on the secondary infringer
though he or she is not directly involved but because he or she implicitly promotes, aids
on gains from the contravening activities of the primary actor. For example a hall-owner
will be liable for copyright infringement if he or she knowingly rents for profit his or her
hall for showing an infringing movie.
Courts often turn up economic justification. It is
easier to stop the person who provides support
(secondary infringer) rather than instituting
multiplicity of suits against innumerous primary
infringers. This is a means to shift injury costs to
those who are in a position to prevent future
injuries.
Copyright Infringement-Liability Road Map
Copyright
Infringement

Direct Copyright
Indirect
Infringement or
Copyright
Primary
Copyright Infringement
Infringement

Tertiary
Secondary Copyright
Copyright Infringement
Infringement

Confined to
Vicarious
Contributory Academic
Infringement
Infringement understanding
Liability
Liability only

Knowledge of Right and Direct and

Substantial
Infringing Ability to Financial
Participation
Activity Control Benefit
Mr. X’s Photocopying Shop
Mr. X has a self-service photocopying shop. The
customers (who want to photocopy) record, in a register
kept in the shop, (i) their name and mobile number, (ii)
the detail of the materials to photocopied, and (3) the
number pages to be photocopied. Mr. X verifies the
register and calculates the charges the customers need to
pay. Mr. X issues the customers passwords to operate the
machines after receiving payment from them.
Vicarious Liability
 Suppose, Mr. Y, a customer, had photocopied Mr. Dan
Brown’s novel Inferno entirely, he would be a direct
infringer as he infringed Mr. Brown’s right of
reproduction. Mr. X would be vicariously liable as he
possessed the right and ability to control what his
customers could photocopy as well as he directly
derived financial benefit from the infringement,
although he might not have actual knowledge
infringement.
Contributory Liability
 Moreover, if Mr. X owns the premises that houses the
photocopying shop, then, the vicarious infringement case
against him would become much stronger, as in that case, he
could more effectively decide and control how his customers
should conduct themselves within his premises so that their
conducts did not result in unlawful outcomes. Mr. X would also
become liable for contributory infringement had he have the
knowledge of infringement, since, that would be a clear case
where he knowingly facilitated Mr. Y’s infringing acts.
 Consider a slightly different scenario, where Mr. Y happened to
be a friend of Mr. X and Mr. X did not charge Mr. Y. In such a
scenario, Mr. X would be liable for contributory infringement if
he knew that the acts of Mr. Y constituted infringement since he
facilitated Mr. Y infringing activities. However, Mr. X will not be
vicariously liable as he had not derived any financial benefit.
 Scope of Secondary Copyright
Infringement Liability in India
 Knowledge from Contributory Prong
 Profit from Vicarious Prong
Peer-to-peer (P2P) computing or networking is a distributed
application architecture that partitions tasks or work loads between
peers. Peers are equally privileged, equipotent participants in the
application. They are said to form a peer-to-peer network of nodes.
Generation of p2p
Client-server model Pure p2p model
A&M Records v. Napster (Ninth
Circuit)
Napster’s “MusicShare” software allowed internet users
to search for MP3 music files stored on each others
computers and exchange the files directly with one
another. The software maintained a dynamic directory of
the files available from users currently logged on to the
system. Each time a user logged on, the software would
add that user’s IP address and list available files to the
directory. A logged-on user could then search the
directory for desired files and download it.
Continuation
 The Court held that since Napster was aware the
specific infringing files being transmitted through its
sytem it could be held for contributory liability.
MGM Studios, Inc. v. Grokster,
Ltd., 545 U.S. 913 (2005)
Grokster distributed peer-to-peer ("P2P") sharing software which
was completely different from the earlier generations of p2p
software. In this software there was no support from the central
server. The United States District Court for the Central District of
California originally dismissed the case in light of an earlier U.S.
Supreme Court decision in Sony Corp. v. Universal Studio
(popularly Known as the Betamax decision). In this case the U.S.
Supreme Court borrowed the staple article of commerce doctrine
from patent law and held that sale of an article does not constitute
infringement if the product is widely used for legitimate, un-
objectionable. Indeed, it need be capable of substantial non-
infringing uses. Then Appeal Court the Ninth Circuit Court of
Appeals, upheld the lower Court's decision after acknowledging
that peer-to-peer ("P2P") software has legitimate and legal uses.
MGM
On June 27, 2005, the Supreme Court held that the
providers of software that designed to enable “file-
sharing” of copyrighted works may be held liable for the
copyright infringement that takes place using that
software. The Court held that “one who distributes a
device with the object of promoting its use to infringe
copyright, as shown by clear expression or other
affirmative steps taken to foster infringement, is liable
for the resulting acts of infringement by third parties.”
Our High Court
 The Calcutta High Court has passed an ex-parte injunction
restraining a number of Internet Service Providers (ISPs) from
providing access to www.songs.pk, a website which has gained
notoriety for providing the latest Bollywood music for free
downloading to all visitors. The lawsuit before the Calcutta High
Court has been filed by the Phonographic Performance Ltd.
(PPL), Indian Music Industry (IMI) and Sagarika Music Pvt. Ltd.
The defendants named in the suit are various ISPs such as
Dishnet Wireless Ltd, Reliance Wimax Ltd, Hathway Cable &
Datacom Pvt Ltd, Hughes Communications Ltd India, Tata
Teleservices (Maharashtra) Ltd, Reliance Communications
Infrastructure Ltd, Wipro Ltd, Sify Technologies Ltd, Bharti
Airtel Ltd, Vodafone India Ltd, and BG Broadband India Pvt
Ltd.
 Authorization Liability
• Section 106 of the US Copyright Act, 1976 confers an exclusive right of authorization upon the
copyright holder which implies reading of secondary infringement liability under the Act
US
• Section 16 of the Copyright, Designs and Patents Act, 1988 state about authorization. However.
the U.K. courts adopt a narrow view of authorization, and interpret the term “authorization” to
mean to “sanction, approve and countenance”.

UK • A distinction is maintained between facilitating an infringement and authorizing an

infringement.

• Section 14 of the Indian Copyright Act, 1957 provides for the right of authorization upon the
copyright holder which implies reading of secondary infringement liability under the Act.
India
 Under Section 14 of the Copyright Act, 1957 a copyright
owner not only holds the exclusive rights to do certain
activities (like reproduction, distribution, public
performance etc.) in respect of the copyrighted
material, but he or she also possesses the right to
“authorize the doing” of such activities. This
authorization right being an instance of ownership
partakes the character of right in rem so as to be valid
against the entire world. Each and every member of
the community is, thus, obligated not to authorize the
activities which the copyright owner can exclusively
undertake.
John Doe” orders or “John Doe”
injunctions
“John Doe” orders or “John Doe” injunctions are “cease and
desist” orders passed by a court against anonymous
entity/entities. These orders in the recent times have been
issued in matters of protecting copyrights.
Order 7 Rule 1 of the Code of Civil Procedure provides that
the plaint shall contain the name, description and place of
residence of the defendant so far as can be ascertained. When
such identification is unknown, a “John Doe” suit is
maintainable. An U.S. Court held that for entertaining the
John Doe suit, the plaintiff should identify the missing party
with sufficient specificity such that the Court can
determine that the defendant is a real person or entity
who could be sued in federal court.
Reliance Pictures v. ‘John Doe’s I.A. No. 13476/2011 in the Delhi
High Court (“Bodyguard” Movie Case)

 In the Bodyguard Movie Case, the Delhi High Court opined that
“defendants and other unnamed and undisclosed persons, are
restrained from communicating or making available or
distributing, or duplicating, or displaying, or releasing, or
showing, or uploading, or downloading, or exhibiting, or playing,
and/or defraying the movie ‘Bodyguard’ in any manner without a
proper license from the plaintiff or in any other manner which
would violate/infringe the plaintiffs copyright in the said
cinematograph film ‘Bodyguard’ through different mediums like
CD, DVD, Blue-ray disc, VCD, Cable TV, DTH, Internet services,
MMS, Tapes, Conditional Access System or in any other like
manner. Plaintiff is permitted to publish the ‘John Doe’
injunction order passed today in the local newspapers.”
 Scope of Online Service Provider
Liability
• Addressed by Digital Millennium
US Communications Act of 1998

• Addressed by Digital Economy Act 2010

UK (DEA).

• Addressed by Information Technology

India Act, IT (Amendment) Act, 2008
Information Technology Act
In India, intermediaries are governed under the IT Act,
which defines an intermediary as “any person who on
behalf of another person receives, stores, or transmits
that electronic record or provides any service with
respect to that record”.
This definition is very wide and covers a diverse set of
service providers, ranging from Internet service
providers, search engines, web hosting service
providers, to e-commerce platforms or even social
media platforms.
Indian Safe Harbour
 India grants intermediaries a conditional safe harbour under the IT Act and the
Information Technology (Intermediaries Guidelines) Rules 2011.
 Section 79 of the IT Act provides that an intermediary is not liable for any
third-party content hosted/made available through such intermediary when:
(1) the function of the intermediary is limited to providing access to the system;
or (2) the intermediary does not initiate, select the receiver of or select/modify
the information contained in a transmission; and (3) the intermediary observes
due diligence and abides by other guidelines prescribed by the Government.
 The 2011 Intermediaries Guidelines provides a diligence framework to be
followed by intermediaries in order to avail of the exemption under Section 79.
Various procedures have been prescribed which need to be observed by an
intermediary, such as (i) the need to inform the users of the computer resource
not to transmit any information that among other things is harmful, obscene
or defamatory; (ii) the requirement to “act within 36 hours” of receiving
knowledge of the transmission of any prohibited information; and (iii) the
requirement to disable information that is contradictory to the Intermediaries
Guidelines.
Section 52 of the Copyright Act. Certain acts not
to be infringement of copyright.
(1) The following acts shall not constitute an infringement of copyright, namely:

(c) transient or incidental storage of a work or performance for the purpose of

providing electronic links, access or integration, where such links, access or
integration has not been expressly prohibited by the right holder, unless the person
responsible is aware or has reasonable grounds for believing that such storage is of
an infringing copy:

Provided that if the person responsible for the storage of the copy has received a written
complaint from the owner of copyright in the work, complaining that such transient or
incidental storage is an infringement, such person responsible for the storage shall refrain
from facilitating such access for a period of twenty-one days or till he receives an order from
the competent court refraining from facilitating access and in case no such order is received
before the expiry of such period of twenty-one days, he may continue to provide the facility
of such access;
U.S. Digital Millennium Copyright
Act (DMCA)
 DMCA, Title II, the Online Copyright Infringement Liability
Limitation Act ("OCILLA"), creates a safe harbour for online
service providers (OSPs, including ISPs) against copyright
infringement liability, provided they meet specific requirements.
 OSPs must adhere to and qualify for certain prescribed safe
harbour guidelines and promptly block access to alleged
infringing material (or remove such material from their systems)
when they receive notification of an infringement claim from a
copyright holder or the copyright holder's agent.
 The Act also includes a counter-notification provision that offers
OSPs a safe harbour from liability to their users when users claim
that the material in question is not, in fact, infringing.
Super Cassetes Industries Ltd. vs Myspace Inc. & Another
(Justice Manmohan Singh, Delhi High Court on 29 July, 2011)

 The case of Super Cassettes Industries Ltd. v. Myspace Inc.

although pending final judgment, is already considered a
landmark example of the application of copyright law to hold an
intermediary liable for infringement. In this case, the Court
found Myspace guilty of primary copyright infringement for
allowing the viewing and sharing of images and music over
which Super Cassettes claimed ownership. Though Myspace
argued that they are an intermediary within the meaning of the
IT Act and are thus exempted from liability for third-party
activities on the website, the court did not agree with this
argument on various grounds, finding that Section 79 of the IT
Act (which provides safe harbours) has to be read in
conjunction with Section 81 of the IT Act which gives precedence
to the Indian Copyright Act. This case is pending final
determination.
The French HADOPI Law ( Haute Autorité pour la
Diffusion des œuvres et la Protection des droits
d'auteur sur Internet)
The law promoting the distribution and protection of
creative works on the internet was introduced during 2009,
providing what is known as a graduated response as a means
to encourage compliance with copyright laws.

HADOPI is the acronym of the government agency created to

administer it.

The HADOPI law was revoked on 8 July 2013 by the French

Government because the punitive penalties imposed on
copyright infringers was considered to be disproportionate.
Thank You