Intellectual Property Rights - Case Study Example

Topic: IP Law Question 2 Intellectual property rights being primarily negative rights, they empower the right-holder to utilize and dispose of his rights, as well as to initiate action against anyone who violates the same. They can be enforced in numerous ways such as civil and criminal proceedings, and sometimes even administrative proceedings.1 Though there are traditional methods of enforcing these rights such as injunction, cost and damages; of late, unconventional measures such as the Anton Piller order, are fast gaining momentum in gathering evidence so as to assist in collecting relevant information against the suspect.2 This order is granted to the claimant as an ex parte application on account of the fact that vital evidence and relevant information may be lost if the claimant waits for too long. For if the defendant is first served with a writ, he might modify or destroy incriminating documents, remove goods and hide them, or even inform third parties to whom he sells such infringing copies of the original work and thereby, keep that channel secured for further infringing activities.3 He is therefore, legally given the opportunity to discover such evidence. The purpose of the Anton Piller order was first explained in Yusuf vs. Salama4, where Lord Denning MR had emphasized on the need to prevent destruction of evidence by way of this order.5 In this case, Hermione, (who is a newly qualified solicitor employed by ARGUE AND TWIST Solicitors) has been instructed by Broomsberry Publishing plc who own the copyright in JR Rowling’s book “Henry Porter and the Philosopher’s Pebble.” As per the instructions, Hermione carries out the search alone and late at night one Saturday. At the time of the search Hagrid is not present, but his wife and children are. While conducting the search she loses some of his personal files from the computer, and certain other books and documents in a taxi on the way back. She also removed material relating to tax evasion which she thought would be supporting evidence. Now, as a matter of replying to the letter received from the Solicitor’s Complaint Bureau, Hermione is to review the manner in which she conducted the search that night. In order to review the manner in which Hermione conducted the search, it is imperative to throw light on the constituent components of an Anton Piller order. As noted by Dockray and Ladley, these orders are to be executed, not by force, but only after obtaining the consent of the person to whom such order is directed; the order allows for examination of documents as well as removal of documents and other related properties; and lastly, though the order is ex parte it still needs to be permitted by the defendant (failing which he might be held guilty of contempt of court). 6 However, what truly necessitates an Anton Piller order needs to be looked at closely. In the very case where this order originated i.e. Anton Piller KG vs. Manufacturing Process7, these basics for constituting an Anton Piller order were laid down :- (a) There must be a strong prima facie case against the defendant (as found in Rank Film Distributors Ltd vs. Video Information Centre)8 (b) that there is a risk of grave potential or actual damage to the plaintiff (c) that there is apparent evidence that defendant has incriminating documents in his possession and there seems a likelihood that he might to try to destroy the same if served with a writ order and (d) finally the belief that even if a search order was conducted in the defendant’s premises, it would not result in imminent harm to him. It could very well be a test of his honesty, in which case he had nothing to hold back in the eyes of law. On the contrary if he were dishonest, the order would just establish it to be so. 9 However, given the much wide powers under this order and the all-encompassing rights to the plaintiff in gathering evidence, one seems to neglect the defendant’s rights, resulting in blatant abuse of this order. Consequently, orders would be granted on mere suspicion rather than a solid case of infringement,10 they would be exploited to gather business information about rivals, the execution of such orders would often surpass the limitations set forth, documents would disappear and execution would take place at inappropriate times 11, so on and so forth. Resulting from such abuse of these orders, new rules took form of set guidelines which were to be adhered to while executing these orders. Search orders are to be granted only in matters of urgency, they are to be executed only during office hours and not during weekends or odd hours. This implies that counsel for the party about to be searched must be able to available for consultation12 Looking into the facts of this case, it is evident that Hermione has acted outside the scope of the powers this order allows. She not only conducted the search at an inappropriate time, she also lost some of the documents in the process. It has been clearly stated under the rules of the Practice Direction that though items are removed from the defendant’s premises, the applicant is later to insure the same.13 Since Anton Piller orders are essentially directed at preserving evidences to be later used by plaintiff in supporting his case, to ensure that the search is conducted properly and items are seized and not lost, there comes about a need to employ an independent, neutral supervising solicitor, independent of both the parties.14 Since Hermione has by and large flouted the rules underlying this search, she might be held liable for the same. In response to the letter from the Complaint Bureau, the managing partner has little to advise Hermione, given the fact that she did not conduct a proper search. By way of remedy for such abuse, she might be asked to return the seized items, held guilty of contempt of court for failure to inform the defendant of the materials detained under the order, and may even have to pay punitive damages for the same.15 Lastly, the Practice Direction confers power on a ‘responsible employee of the defendant’ or to ‘persons appearing to be in charge of the premises’.16 Hermione could take defense of this fact that Hagrid’s wife was present when the search took place. However, this line of argument seems a little blurred as regards the precise definition of the same. It would therefore, have to be decided by the court. In the light of the abovementioned events, Broomsberry could apply to the court for an interim injunction. This is a court order effectuated to stay events pending before a final determination and can only be granted when there is a serious emergency. As observed by the House of Lords in American Cyanamid vs. Ethicon17, for a court to go ahead with an interlocutory injunction, the claimant must first establish that there is a ‘serious question to be tried’.18 This condition can be met by Broomsberry with the aid of the material seized during the search order which in effect, constitutes a prima facie case. It is important to keep in mind that unless the claimant has a definite stand of establishing his or her claim for a permanent injunction at trial, the court will not even remotely entertain the balance of convenience.19 At this stage, the courts should try and look into a known cause of action only, while taking into account points of law that naturally arise from facts revealed at the interim stage. Difficult and excessively disputed questions are to be avoided. 20In the event of an injunction not being granted, Broomsberry can ask for damages. If the defendant is able to pay the damages, it will not be provided with further interim relief.21 However, since the defendant here owns a small shop and has likelihood of being able to pay damages which might run to an exorbitant amount, it is more likely that Broomsberry will be granted interim relief, as per Quantel vs. Shima Seiki Europe.22 Broomsberry can take resort to Mareva Injunctions, which is an ex parte injunction, resulting in freezing the assets of a party by restraining that party from removing the items from the jurisdiction. As laid down by Lord Denning MR in Third Chandris Shipping Corpn vs. Unimarine SA, the claimant has to first make a full disclosure regarding relevant information, clarify the grounds for his claim while mentioning the arguments raised against this claim by the defendant, indicate that there assets of the defendant within the jurisdiction and unless action is taken, these assets might be removed by the defendant. He also needs to give an undertaking in damages. Finally by bringing in various factors and evidences together, show that his case is indeed strong and based on merits.23 There are other remedies available to it, which Broomsberry can take resort to. It can try and stop importation of such infringing materials, thereby preventing infringement at the very beginning of the source which continues the chain forward. Legal mechanisms under Articles 51 and 52 of TRIPS discuss such measures.24 By way of damages, Broomsberry can ask for compensation of the loss of profits resulting from the sale of infringing materials made or distributed by the defendant. If it is unable to claim on those grounds, it can still avail of remedies if the court makes an award on a royalty basis. Here the damages are representative of the fee to be paid by the defendant for a licence to use the rights he so violated. If Broomsberry is not in the practice of granting licences, it would to have determine some other basis for the payment of royalty by the defendant.25 Since Broomsberry is an established publishing house and is unlikely to suffer exceptional loss in profits due to Hagrid’s infringing activities, it can elect for an ‘account of profits’ rather than claiming damages for the same. Account of profits entails that the defendant be deprived of any profits that accrued to him, owing to his infringement.26 This essay lends support to the fact that though civil remedies are available by way of search orders and other remedies, the defendant does not automatically become completely defenseless without any legal remedy. The law has been expounded so as to balance the interests of both the parties and ensure justice is meted out in the best possible way. BIBLIOGRAPHY Books:- Bently, Lionel & Sherman, Brad, Intellectual Property Law, 1st ed, 2001, Oxford University Press, New York. Torremans, Paul, Holyoak and Torremans on Intellectual Property Law, 4th ed., 2005, Oxford University Press, New York Web Sources:- Bhadra, Souvik & Majumdar, Arka, Anton Piller Order in UK and its Possible Implications in India, p.488, available online on http://nopr.niscair.res.in/bitstream/123456789/273/1/JIPR%2012(5)%20(2007)%20488-496%20.pdf, accessed on 12/08/2010 Professor Berryman, Jeff, Thirty Years After: Anton Piller Orders and the Supreme and Federal Courts of Canada, available online on www.jiclt.com/index.php/jiclt/article/download/28/27, accessed on 12/08/2010 Read More