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Role of IP in E-Commerce

By: Syeda Fauzia

Introduction:

What are Intellectual property Rights?

Intellectual Property Rights (IPR) would refer to anything and everything that is the conception of the human mind which creates an exclusive right bestowed upon the person over the creations of their intellect. According to the Oxford Dictionary, “intellectual property is an intangible property as a result of human creativity.” Intellectual Property is of various kinds, few significant ones being Copyrights, Trademark and Patents. IPR also include inventions of a product or process, a start-up business, creating new music or lyrics of a song and many more.

What is E-Commerce? 

Electronic Commerce or E-Commerce as simply told is where commercial transactions are conducted through online mode. These would include conducting or establishing businesses, exchanging goods and services or both primarily over the internet. Examples For E-commerce would include platforms such as: Amazon, Swiggy, Zomato and so forth.

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How are IPR and E-commerce interlinked? Let’s find out!

In today’s world, economies are constantly growing and changing. Internet as such plays a vital role in the development of the same. That being the case, it is necessary to understand that IPR plays a crucial role in the process of conducting e-commerce business and its impact in the virtual world. It is necessary to keep a tab on E-commerce along with the technology infrastructure in such a manner that the value of the intellectual property is not disregarded. It is crucial than ever that there needs to be a constant process of improvement in this technicality of internet access.

The methodology to understand the role of Intellectual Property in E-commerce is based on certain aspects. They are:

  1. Protection of business

IPR plays an important role in safeguarding the core business interest of a company including all its affiliates/subsidiaries, its domain in the corporate world. More fully against unfair competition amongst the businesses. In case there is no application of IPR or the IPR laws are not abided by, it will lead to severe violations of IPR and the consequences will surely affect the goodwill of a Company. That means to say that IPR plays a significant role in the digital economy. Without IPR in place, anything and everything can be pilfered. It may extend from design to software. The Owners may be perplexed by such duplication and stealing and then the same being floated over the virtual domain. The Owners will never be recognized for their unique innovations.

  1. Safeguarding the ownership of the factors involved in the business development.

There would be several factors that enable a company to be structured and with Intellectual Property law in place, especially for the e-commerce transactions helps to safeguard the digital and technical components which are critical to the company. For instance, there can be software that is connected to networks/routers, software designs, software programs, HTML codes etc. All these factors may be available in different forms and may contain an intellectual property right that not only needs to be protected but to be continued to be protected. This will enable E-commerce to run efficiently and smoothly. Thus, the IPR coated E-commerce safeguards these important factors which are essentially the enablers.

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  1. Protection of IPR

Every E-Commerce business recognizes IPR on all such creations/innovations especially the patents, copyrights, marks and trade secrets. A product that is developed by a company or an individual and commercializing the product involves the development of a variety of technologies so as to protect the product in the public domain. In such cases, the companies/individuals turn up to technology providers who will enter into licensing Agreements wherein certain rights are given for a certain period of time and for a specific purpose. The License Agreement facilitates the owner of the product to safeguard his intellectual property rights in his products by way of acceptance of the owner’s standard terms and conditions wherein the IPR protection is deemed a material term of the contract.

  1. Preservation of patent portfolios and trademarks

If a business has to capture the market in the e-commerce arena, IPR creation becomes an impeccable asset to the Company. The Company will own the portfolio of such intellectual property eg: by Patent or trademark registration. This enhances the company’s credibility and of course will lead to significant development in the company’s financial position as the online business world catches the company that shows their business in the light of the preservation of their patent portfolios and trademarks.

IPR and E-Commerce

Several Companies believe in the fact that their intellectual properties are worthy to a great extent such that the protection of the tangible assets owned maybe a secondary priority. This is very much true in the global market and with the recent happening of online businesses because the intellectual property rights and the law that exists with regard to the same enables the companies from keeping their trade secrets protected and disallows any unfair competition.

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IPR plays an important role in E-commerce in today’s digital economy. The laws that govern the IPR has brought businesses globally to function by supporting new creations but also guarding the tedious inputs that are gone into by the creator of such intellectual property. The laws pertaining to Intellectual Property Rights allows the law to block others from stealing the Intellectual property of the owner. So that there is no impact on the financial position of the inventor and their struggle in bringing the goodwill in the b2b market which is available in the electronic network.

Fundamentals of IPR in e-commerce:

E-Commerce is a great enabler of a business. However, it is the owner who is solely responsible for protecting intellectual property rights. If the owner while revealing the intellectual property to the public or in any media through E-commerce fails to protect it beforehand. This becomes fatal and gives scope for the others to use the owner’s intellectual property unfairly much before filing for its protection. There may not be any legal solution that the owner can adapt and also leaving the culprits to walk away freely with no reprimand whatsoever. No trade secrets can be protected once it is in the public domain. The owner loses all his rights against the virtual world. Eg secrets of a Software algorithm if shared, then such software algorithms cannot be protected.

Breach of Intellectual property

Any website that involves transactions that are mostly buying or selling online is a part of E-commerce websites. Companies while doing e-business may knowingly or unknowingly tend to violate the intellectual property rights by displaying the images, designs or even products of other companies. The most common example is that of Chinese products that look similar but are just a duplication of the original product. Such companies should carefully ensure that they do their due diligence effectively to avoid any infringements of the owner’s intellectual property rights and also that they do not violate the laws that protect the intellectual property in the country of origin of the product.  They should be able to show that the sale is on an original development and that the intellectual property owner is well aware and there is permission to sell in the online platform.

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Protection of IPR under E-commerce

IPR in retail and e-commerce deals with buying and selling products through a physical shop and a website, respectively[1]. In retail also a owner needs to protect his intellectual property rights. Iit is no different that is for E-commerce and should various types of intellectual properties. The following states the usual IPR in E-commerce.

Various patent models protects E-commerce like search engines etc. Patent Law or the Copyrights Act depend from country to country and their IPR laws may be divergent in application. Eg. A website design protected by copyright law. The copyright protection is available under the copyright law for the graphics, designs, materials, audio or video clippings, photographs etc. Therefore the companies in e commerce world can protect their database under such copyright laws as applicable in their specific country.

Protection of brands:

Features that are posted on their application and/or their websites under the Trademark Law. the Intellectual Property Rights also encompasses protection of webpages, displays that are computer-generated, graphics, graphical user interfaces. This may also be protected under at the Industrial Design Laws as per the applicability in their respective country.

There would be certain websites which will have hidden characteristics like graphics that are confidential in nature, source codes, flow charts, data structure, algorithms, various technical descriptions, manuals, contents etc to name a few, are entirely protected under various Trade Secret Laws and opens up the various other laws in protection of such intellectual property rights.

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Conclusion:

In today’s world there is no denying of the fact that achievement of fair and ethical compliance of online businesses and practices cannot be accomplished without the effective use of Intellectual Property Laws. The society is more relying on e commerce and not only the E- businesses development wherein the retail activity is drastically reduced. Like the pandemic struck economy wherein the E-commerce led to significant growth in the virtual market. Making it more diverse and dynamic approach of online platforms.

As the growth of online business expands the Intellectual Property Rights facilitates the companies to protect and monitor their trade activities that are especially to maintain secrecy. IP rights in e-commerce also allow IPR owners to claim a share of the company’s profits. The Implementation of intellectual property rights will focus on the features that are exclusive and are unavailable to others and thus making the implementation of E-Commerce activity in the public domain successfully. The Legal protection of intellectual property rights brings in sturdiness in the usage of intellectual property which helps in not only in licensing, contracting, outsourcing but also helps in building strategic relationships, developing new concepts which in return enhances the sales and E-Commerce business by bringing in features that are unavailable to its competitors. This enables a healthy competition in the internet world and bringing in profits to the right owners of the intellectual property. Therefore Intellectual property stands as a guard to the E-Commerce and enhances fair play in the economy while adopting right measures of protection if Intellectual Property Rights.

 [1] What’s the Role of Intellectual Property in Ecommerce? (thebalancesmb.com)

 

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The Effect of Artificial Intelligence on Human Beings and Society

Individuals today live in the world of Artificial Intelligence (AI). It permeates our lives in numerous ways, either directly or indirectly, by performing tasks that, until quite recently, could only be performed by a human with specialized knowledge and training. Some of the examples of the use of AI in our daily lives include spam filters, Alexa, Siri, driverless cars, automatic vacuum cleaners etc. These technologies are used in different sectors like technological industries, healthcare, education, transportation, defense, law and agriculture, among many others. This list keeps on increasing with time owing to the technological advancements taking place in the modern world.

The increasing ubiquity and rapidly expanding commercial potential of AI in different sectors has spurred massive private sector investment in the AI projects. The potential for further rapid advances in AI technology has prompted expressions of alarm, wherein some scholars highlight the role of government in regulating the development of AI and putting restrictions on AI operations.

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Before understanding what steps have been taken by different jurisdictions to address the implications of growing use of AI, it is important to understand exactly what issues relating to AI needs government deliberation. Broadly, the most significant issues can be listed as- data protection concerns, the issue of biasness, the challenges to the Intellectual Property regime, the issue of civil liability as well as the impact of AI in the criminal justice system.

As AI continues to find its way into our daily lives, its propensity to interfere with human rights only gets more severe. Privacy is recognized as an international human right that is essential to human dignity and is inalienable. Data protection also forms an intrinsic part of an individual’s privacy as privacy can be guaranteed only when the personal and sensitive personal data of an individual is protected. Taking this implication into consideration, many jurisdictions now recognize the right to data protection, as part of right to privacy, and therefore, a fundamental right. The increasing use of AI creates an issue in the domain of data protection as the AI systems are often trained through access to and analysis of big data sets. This makes the right to data protection susceptible to violation as there is a possibility of leak of personal data or sensitive personal data of an individual by an AI.

Machine learning is a type of artificial intelligence which uses data sets to understand the pattern and learns to perform a particular task from it. Because machine learning algorithms use data sets to derive a conclusion, if the data set provided to the machine learning system is itself biased, the system will provide biased results. Furthermore, since AI is a technology, it is susceptible to minute measurement errors. However, such minute errors might lead to a big problem with millions of users, when thousands could be affected by error rates. These two issues create biased results. For example, Google Photos’ image recognition software, in 2015, labelled photos of black people as ‘gorillas’. Owing to the complex software model, the developers were unable to resolve the issue. Therefore, the only recourse available was to remove any monkey-related words from the data which was fed to the AI.[1]

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With respect to the impact of AI in the intellectual property (IP) regime, there are two sets of implications. Firstly, the impact of law on the creations of artificial intelligence, and secondly, the impact of AI on law i.e. how AI technology is being used in the field of law. With respect to the former, there is much debate going on around the world with respect to giving the AI the IP rights of its own creations, without human intervention. Since some types of complex AI can ‘invent’ or ‘create’ creative work without human involvement, there is a unanimity in addressing the legal status of such invention or creation. This is where the role of patent and copyright regime comes into picture. Although a number of applications mentioning AI as an inventor, have been filed in the patent offices of different jurisdictions, however, these jurisdictions have shown their reluctance in granting the AI intellectual property rights. In the similar way, courts in various jurisdictions have reiterated that copyright can only be granted for works which involve human as a creator. However, it should be kept in mind that AI technology is developing and in future, there might be cases where AI invents or creates something which the programmer of such AI has no idea about, or has no role to play. In such a situation, is it justified to not develop the IP regime to accommodate such inventions and creations.

There are many documented cases of AI gone wrong in the criminal justice system. Machine learning is often used for risk scoring the defendants as a means to remove human bias prevalent in judges while adjudicating cases with respect to sentencing and bail. Predictive policing, on the other hand, is used as a measure to allocate police resources to prevent crime. However, the conclusions arrived at using such AI systems in the criminal justice process re-introduces the element of bias against the accused, which these AI systems were aimed at addressing. Another issue with respect to the intersection of AI and criminal law is the ambiguity with respect to the criminal liability in case AI does an act, which, if done by a human, would constitute an offence under the criminal law.

Lastly, the issue of civil liability of AI highlights the situation where the traditional concepts of conceptualizing liability is being adopted by the courts if a product liability claim involves an AI.

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[1] WIRED, https://www.wired.com/story/when-it-comes-to-gorillas- google-photos-remains-blind/ (last visited Feb. 1, 2021).

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Cyberspace Regulatory Models and their Feasibility

In order to address the issues posed by cyberspace in the present day, few scholars have contended that it should not be regulated at all, as any form of regulation might stifle the unfettered potential for growth in cyberspace.

These arguments rely on the fact that over a period of time, cyberspace as well as its users, will mature, which will automatically create a robust and socially organized system. This contention is further based on the premise that the act of discouraging or looking down upon undesirable conduct on the internet is similar to how such undesirable acts are looked down upon in real life. Informal social control regulates the behaviour of an individual even though no one is looking. If such social control fails in any manner, sanctions like explicit disapproval in the society, ridicule or ostracism, act as a form of payback to the individual.

Scholars who base their arguments on informal social control also assert that when an individual uses the internet, he abstains from any misconduct out of the fear of internalised norms, and not out of the fear of law, taking into consideration that most of the individuals are unaware which acts are not acceptable in the cyberspace. Therefore, they apply the same standards of caution and care as they would apply, in case of the real world.

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Thus, over a period of time, individuals will acquaint themselves with what is and what is not acceptable in the cyberspace, and the informal social control will act as an effective regulator.

However, these arguments fail because even in the real world, there are deviant subcultures who do not conform to the norms of the society. Also, misconducts in the real world differ from the misconducts in the cyberspace. Therefore, there is a need for formal regulation of cyberspace. This need is further amplified owing to the cross-national impact of use of cyberspace. Furthermore, cyberspace regulation is necessary as an unregulated cyberspace creates an environment where the rights of individuals as well as the remedies available to them, is uncertain[1]. This uncertainty has the capacity to undermine the legal systems of the world, owing to cyberspace’s global import[2].

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Taking into account the nature of cyberspace and its implications on different aspects of an individual’s life, the conduct of various nation states and corporations, it can be concluded that there is a need to address the question of governance of cyberspace. The current literature and deliberations by various scholars suggest that the question is not whether cyberspace should be regulated, but how it should be regulated and who are the stakeholders in the process of regulation.

The following are the proposed models of cyberspace regulation by various scholars-

  • Regulation by code and architecture

Certain scholars[3] propose the use of code and architecture for regulating cyberspace. They believe that since internet was invented for research and not for commerce, its founding protocols are inherently unsecure and are primarily designed for sharing the data, rather than concealing it. This provides a breeding ground for cybercrime activities.

However, it is argued by these scholars that the internet is, by far, the most regulable space, since, through its architecture, it can reveal who someone is, where they are and what they are doing[4]. The code and architecture of the technology can very easily help in identifying the wrongdoer by tracing the Internet Protocol (IP) address of the computer used for the commission of cybercrime.

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The scholars also argue that the specific issue of territoriality posed by the cyberspace can only be addressed by the use of code and architecture to trace down the actual location of the computer which was used to commit wrongful acts on the internet[5].

However, merely relying on codes and architecture can, although help in identifying the cybercriminal, but it will not play a key role in preventing cybercrimes and ensuring prosecution of such cybercriminals.

  • Regulation by the Government

The role of government in the regulation of cyberspace comes in picture by virtue of sovereignty, territoriality (over its subjects who might be victim of cybercrime), public interest (addressing cybersecurity issues which are posed to its subjects) and national security.

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Government is considered to have a primary responsibility for formulating cyberspace policies which govern the cyberspace and stimulate the rights, liabilities and remedies available to the parties involved. It is also obligated to take steps for international co-operation in the field of cyberspace regulation, owing to the borderless nature of the cyberspace and the jurisdictional issues stemming from it.

However, the model of governance where just the government is responsible for regulating the cyberspace fails to take into consideration the ineffectiveness of government in addressing the issues faced in the real world. If the state is not competent to regulate its territorial limits itself, how can it be expected to single-handedly regulate the cyberspace, which has no territorial limits. Further, the state might not have appropriate strategies to tackle these issues, owing to the technical nature of such activities.

  • Self-regulation by private players

Another model of cyberspace regulation relates to the regulation by the market i.e. self-regulation by the key market players or the private institutions.

The private players are the major stakeholders in the cyberspace due to which they have a great impact on the policies formulated by the government. Some scholars believe that compared to the regulation by government, self-regulation offers greater speed, flexibility and efficiency[6]. Furthermore, the fact that self-regulation responds to the specific industry circumstances makes it more desirable form of regulation.

There are primarily three forms of self-regulation by the private players with respect to the role of government in such regulation[7]

  1. voluntary or total self-regulation, without government involvement;
  2. mandated self-regulation, which involves direct government involvement;
  • mandated partial self-regulation, with partial government involvement.

It is difficult to see the first form of self-regulation i.e. pure self-regulation, without any governmental involvement. However, such form of self-regulations do exist. For example, to address the issue of online infringement of copyright in the United States, the Recording Industry Association of America (RIAA), an association formed by music companies in the United States, conducts its own investigations to locate the IP addresses of those who are illegally sharing music[8].

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Self-regulation by private players is mostly directed, shaped or endorsed by the government[9]. One example of such model is the Internet Corporation for Assigned Names and Numbers (ICANN)[10]. It is a non-profit organisation that operates the internet’s Domain Name System (DNS). It is contracted by the US Department of Commerce and overseen by the US Government.

Taking into consideration its effectiveness in efficiently addressing the issues at hand and its viability, self-regulation is often considered the only legitimate form with which to govern cyberspace.[11]

However, self-regulation without governmental involvement to a certain degree, can prove to be detrimental to the society, owing to the global import of cybercrimes and the lack of resources with the private players to address the issues faced in the cyberspace, which is often a chain reaction with a number of victims.

  • Judicial model[12]

The judicial model of cyberspace regulation is based on the premise that since the issues faced in the cyberspace are same or similar to the ones faced in the real world, the regulation of cyberspace should be left at the hands of judiciary as it can regulate the same by applying the existing principles which are used to address the legal issues in real world. Therefore, such principles can be applied to Cyberspace to facilitate an effective regulatory regime[13].

However, this model is inherently flawed in a number of ways. Firstly, courts cannot transpose the existing principles of the physical world to the cyber world owing to the nature of the issues. Also, many issued faced in the cyberworld have no equivalent in the real world. Secondly, this model of regulation totally disregards the question of jurisdiction while applying the traditional legal concepts to the cyberworld. This role of judiciary might come into picture in developing new principles[14] to be applicable to the cyberspace. However, this is the last step towards the prosecution of cybercriminals and is not, in itself sufficient to regulate the cyberspace.

  • Multi stakeholder model of regulation

This model of regulation highlights the flaws in putting the obligation of regulation on the government or the private players. Unlike crime in the real world, cybercrime is not typical one-to-one victimisation[15]. Therefore, scholars have argued that in order to tackle the issues arising from the use of internet in the cyberspace, a higher level of cooperation with states, the private sector and even individual users is required.[16]

This model brings into picture the active and responsible role played by the civilians, as they are the first ones who come to know about the commission of such cybercrimes.[17] Further, since cybercrimes are mostly chain reactions, there is a need for sharing of information about commission of such crimes or cyber security breaches by the individuals and the public and private sectors[18].

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There is no ‘one-size-fits-all’ approach for regulation of cyberspace. All the stakeholders have their own interests and limitations in playing a role in regulating the same. Therefore, the approach involving all the stakeholders addresses the flaws faced by other regulatory models like code and architecture, regulation by the government, self-regulation and judicial regulation and might be the best suited solution for now.

[1] S. M. Hanley, International Internet Regulation: A Multinational Approach, 16 JOHN MARSHALL JOURNAL COMPUTER AND INFORMATION LAW 997, (1998).

[2] D. R. Johnson and D. G. Post, Law and Borders- The Rise of Law in Cyber-Space, 48 STANFORD LAW REVIEW 1367, (1996).

[3] L Lessig and Neal K Katyal.

[4] Lessig

[5] NK Katyal, Digital architecture as crime control, 112(8) YALE LAW JOURNAL 2261, (2003).

[6] N Gunningham, P Grabosky and D Sinclair, Smart Regulation: Designing Environmental Policy, OXFORD CLARENDON PRESS, 52 (1998).

[7] Id.

[8] RIAA, https://www.riaa.com/ (last visited Jan. 29, 2021).

[9] N Tusikov, Chokepoints: Global Private Regulation on the Internet, UNIVERSITY OF CALIFORNIA PRESS, (2016).

[10] ICANN, https://www.icann.org/ (last visited Jan. 29, 2021).

[11] Supra note 4.

[12] Yee Fen Lim, Law and Regulation in Cyberspace, International Conference on Cyberworlds (2003).

[13] Bick J. D., Why Should the Internet Be Any Different?, 9 PACE LAW REVIEW 41, (1998).

[14] Effects test of intentional targeting, Zippo sliding scale test etc.

[15] S W Brenner, Distributed security: Moving away from reactive law enforcement, 9 INTERNATIONAL JOURNAL OF COMMUNICATION LAW & POLICY, (2005).

[16] R Ericson, Crime in an Insecure World, POLITY, (2007).

[17] Supra note 17.

[18] LYC Chang, Cybercrime in the Greater China Region: Regulatory Responses and Crime Prevention across the Taiwan Strait, (2012).

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The Chancellor, Masters & Scholars of University of Oxford and Ors.Vs. Rameshwari Photocopy Services and Ors

Delhi High Court

Judges: Justice Pradeep Nandrajog and Justice Yogesh Khanna

Applicable law: Section 52 of the Copyright Act, 1957

Did you know: A reproduction of a copyrighted work by a teacher or pupil in the course of instruction is allowed and is not an infringement of the copyright

Where it all began:

  1. University and Photocopy Shop were photocopying excerpts from the publications of the plaintiffs and were issuing/selling the said compilations in the form of course packs
  2. The world famous publishers alleged that such publication and sale constituted a copyright infringement and filed a case to require the University of Delhi and the photocopy shop to obtain a license.
  3. The Hon’ble single bench of the Delhi High Court dismissed the suit and an appeal was filed by the publishers before the division bench.

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Legal issue: Whether the right to reproduce work by a teacher or a pupil in the course of instruction is absolute or there are any conditions attached to such a right?

Publisher’s arguments: There are restrictions of fair use that apply to reproduction of materials by teachers and pupils and a license is necessary

University’s arguments: There are no restrictions that apply to the right of reproduction ad no infringement has occurred in this case.

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Judgment in the case:

  1. The court held that it only has to be seen is whether the work used was necessary for achieving the purpose of educational instruction- if it is there will be no infringement
  2. There is no adverse impact on the market of the books because the students still have access to the books in the library.
  3. It was held that the phrase ‘course of instruction’ used in the section will not be limited to just teaching in the classroom but will also apply to the entire program of education
  4. Because the university was not engaged in profit-making the activitiy could not be termed a publication.
  5. The appeal was dismissed and it was held that the preparation and distribution of the course packs was permitted and not an infringement of copyright. The case was sent back to the Single Bench for decision on the question whether whether the course packs were necessary for the educational instruction or not. The suit was finally withdrawn by the publishers

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Significance

The judgment in the case is hailed as a big victory for promoting the access to education. Many writers and academicians, many of whom were infact associated with the publishers, from all over the world condemned the filing of this suit and asked the publishers to withdraw it.

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The Puttaswamy Judgement- How Is Privacy a Fundamental Right?

The jurisprudence in India with respect to the status of right to privacy as a fundamental right has been quite dicey, as pointed out in the previous section. It was only in the case of Justice K. S. Puttaswamy v. Union of India[1] that the Apex Court exclusively dealt with this issue. The case was a reference made by a five-judge bench of the Apex Court to a nine-judge bench. The reference was made owing to the ambiguity arising from the judicial precedents on the status and scope of the right to privacy. The nine-judge bench unanimously held that the right to privacy is an intrinsic part of personal liberty under Article 21 of the Indian Constitution.

The majority opinion authored by Justice Chadrachud discusses in detail, a number of reasons which led to the recognition of privacy as a fundamental right. The following are some of the reasons pointed by the Hon’ble Court in this regard-

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  • Natural and inalienable rights[2]

The court pointed out that privacy, as a right, can be traced to the notion of inalienable rights i.e. the rights which are inherent in and are inseparable from a human being.

Although these rights are inalienable, however, the autonomy which an individual enjoys, by virtue of these rights, is not absolute. The court pointed out an example wherein one employs another person to kill oneself. Here, the individual exercised his autonomy to violate his inalienable right to life. For this simple reason, such autonomy cannot be absolute in nature.

  • Jurisprudence on dignity[3]

The court asserted that ‘dignity’, as a constitutional value, finds its place in the Preamble of the Indian Constitution[4]. The court also said that individual is the main focus of the Constitution as the realisation of individual rights plays a key role in achieving the collective well-being of the community. Therefore, human dignity forms an integral part of the Constitution.

The court held that the sanctity of privacy lies in its functional relationship with dignity, thereby establishing a link between dignity and privacy.

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  • Essential nature of privacy[5]

The court was of the opinion that privacy highlights the reservation of a private space for the individual; the right to be let alone. The concept is based on the autonomy of the individual.

The court further held that the ability to make choices lie at the core of the human personality. In this process, privacy plays an instrumental role by enabling the individual to assert and control the choices he/she makes. Recognizing a zone of privacy is a mere acknowledgment that individual should enjoy autonomy in the development of his/her personality.

Therefore, the court established a relationship between dignity and autonomy with privacy. By virtue of this relationship, the right to privacy forms an important element of human dignity as well.

  • International obligations[6]

Secondly, the court pointed out India’s international obligations towards protection of privacy by virtue of Article 12 of UDHR[7] and Article 17 of ICCPR[8]. Further, Article 51 of the Constitution requires the State to endeavour to “foster respect for international law and treaty obligations in the dealings of organized peoples with one another[9].

The Protection of Human Rights Act, 1993 also defines “human rights” and includes ‘dignity of individual’[10] under its ambit. Therefore, India is under an obligation to safeguard the privacy aspects of human dignity.

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The court also took note of India’s commitment towards international obligations by pointing out the stand of the Indian judiciary in Bacchan Singh v. State of Punjab[11], with respect to the use of the death penalty underlining India’s obligations under ICCPR, and Vishaka v. State of Rajasthan[12], where the court relied on the Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW) to provide guidelines prohibiting sexual harassment.

  • Statutory protection cannot deny a constitutional right[13]

The court stated that although certain aspects of privacy have been protected under different statutes, nevertheless, providing constitutional protection to a right, places it “beyond the pale of legislative majorities[14]. If privacy is considered as a part of the basic structure of the Constitution, it becomes inviolable even through an amendment. However, ordinary statutes come under the ambit of amendment/modification.

  • Not a mere common law right[15]

The court, while addressing the issue that privacy is protected through common law, held that common law protection cannot bar constitutional recognition of a right, which is afforded because such right is an aspect of fundamental freedom or liberty which the draftsperson considered to be so significant as to require constitutional protection.

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  • The ruling of the court- Right to privacy as a fundamental right[16]

Taking into account the reasons summarized above, the court finally held that the right to privacy is constitutionally protected, emerging from the right of life and personal liberty under Article 21 of the Constitution.[17]

Secondly, privacy safeguards personal intimacies, the sanctity of family life, marriage, procreation, the home and sexual orientation[18]. However, this list is not exhaustive[19].

Thirdly, the right to privacy is not an absolute right, like any other right under Part III of the Constitution, including the right to life and personal liberty. Privacy can be encroached by law however, such law should withstand the touchstone of permissible restrictions on fundamental rights. The court formulated a three-pronged test which a law has to pass to intrude into the right to life and personal liberty[20]

  1. Legality
  2. Legitimate state aim
  3. Proportionality

The Court also unequivocally held that the doctrinal premise of M.P. Sharma[21] and Kharak Singh stand invalidated. The court also appreciated the minority view of Justice Subba Rao in Kharak Singh[22].

  • THE IMPLICATIONS OF RIGHT TO PRIVACY AS A FUNDAMENTAL RIGHT

Common Cause v. Union of India[23] represents the first important application of the principles laid down in Puttaswamy[24] with respect to right to self-determination and freedom to make fundamental choices about how to use one’s body[25], as part of fundamental rights under the Constitution.

Further, the Supreme Court while restoring Hadiya’s marriage opined that Hadiya is having internal freedom of choice, marriage and autonomy.[26]

Therefore, ‘privacy’, as a concept incorporates a number of aspects that are now accorded protection under the umbrella of personal liberty under Article 21 of the Constitution.

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[1] Justice K. S. Puttaswamy v. Union of India, (2017) 10 SCC 1.

[2] Id, part G.

[3] Supra note 32, part I.

[4] Supra note 6, Preamble.

[5] Supra note 32, part R.

[6] Supra note 32, part J.

[7] Supra note 4.

[8] Supra note 5.

[9] Supra note 6, Art. 51.

[10] Protection of Human Rights Act, 1993, s. 2(1)(d).

[11] Bacchan Singh v. State of Punjab, (1980) 2 SCC 684.

[12] Vishaka v. State of Rajasthan, (1997) 6 SCC 241.

[13] Supra note 32, part N.

[14] Supra note 32, para 153.

[15] Supra note 32, part P.

[16] Supra note 32, part T.

[17] Supra note 32, part T(3)(C).

[18] Supra note 32, part T(3)(F).

[19] Supra note 32, part T(3)(G).

[20] Supra note 3.

[21] Supra note 14.

[22] Supra note 9.

[23] Common Cause v. Union of India, (2018) 5 SCC.

[24] Supra note 32, part T.

[25] Recognition of right to die with dignity as a part of right to life under article 21.

[26] Shafin Jahan v. Ashokan K.M, 2018 SCC Online SC 201.

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Challenges Posed by the Development of Information Technology

Technology is an essential part of our day-to-day lives. It has made communication and dissemination of information faster and easier. Further, exchange of ideas as well as sale and purchase of goods and services have been facilitated with the advent of internet. Technology and the internet has become so intrinsic a part of our life that we cannot even think about planning our day without the involvement of such technology or the internet. However, this is just one side of the coin. On the flip side, technological advancement has created issues which impact different aspects of our lives. The following part analyses different challenges posed by information technology and the internet to the global community at large.

  • Criminal law

Technological advancement and the internet has provided a breeding ground for commission of crime as the use of computers and the internet is a cheaper means to perpetrate crime which simultaneously impacts a large section of society. These crimes are termed as cybercrimes. They are specifically different from traditional crimes owing to its global import, the anonymous identity of the perpetrator and the involvement of third parties like the Internet Service Providers and the Intermediaries. However, this difference is discarded by the scholars who believe that traditional system of laws are adequate to deal with the crimes in the digital age.

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It is pertinent to note that although cyberspace just acts as a medium to perpetrate a crime, however, it has a number of implications attached to it, which highlights the need for a separate legal framework to punish cybercrimes. Taking into account this issue, different jurisdictions[1] have enacted separate piece of legislations to specifically deal with cybercrimes.

Generally, cybercrimes can be classified as-

  1. Against persons (for example, harassment, spoofing, stalking)
  2. Against property (for example, IPR, data theft, trespass, squatting)
  • Against infrastructure (for example, attack on critical infrastructure)
  1. Against society (for example, pornography, gambling, cyber trafficking, forgery etc.)

Therefore, considering the fact that certain crimes emerged only because of the use of technology, traditional laws cannot be applied to address the criminal law issues posed by cyberspace.

  • Privacy and data protection

Right to privacy is considered a fundamental human right[2] and state is under an obligation to protect the same from unnecessary intrusion. Although cyberspace is not a real place and does not actually exist, however, vast amount of digital information exist in the servers, which includes personal as well as sensitive personal data of individuals. Further, with time, the collection of such data will only increase, which further increases the risk posed by technology in protection of such data.

The manner in which data of individuals is collected and stored has changed after technology came into being. Previously, such data was stored in paper files locked in the chambers of the institutions which collected it. Therefore, the sheer costs of retrieving such data, the impermanency of the forms in which it was stored and the inconvenience experienced in procuring access (assuming that its existence was known), made the issue of privacy and data protection were negligible. However, information stored in servers, which are susceptible to cyberattacks, has significantly increased the risk of data breach/leak.

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Therefore, cyberspace is, in essence, a public domain and if such space is left unregulated, the violation of individual’s right to privacy is a real possibility.

  • Intellectual property rights

With respect to intellectual property right, advances in digital technology and the commercialization of the Internet has altered the core of copyright. The internet has facilitated the level of online piracy of copyrighted works. Unlicensed, but always perfect, copies and streams of copyrighted works are readily available on the internet. With the growth of streaming services, direct download sites, and peer-to-peer services such as BitTorrent, the old problem of online piracy has extended and spread in an unanticipated manner.

With respect to the realm of trademark, information technology and the internet has led to emergence of domain name issues like typosquatting (where a person registers a domain name similar to a real domain name, but with a typo, in hopes that web surfers reach it by accident), cybersquatting (Cybersquatting is done when domain names are registered, sold or trafficked-in with the intention to make profit from the goodwill of someone else) and pagejacking (when the offender copies part of an existing website, and then puts it up on a different website to make it look like the original).

Therefore, technology and the internet have created new issues with respect to the protection of intellectual property rights and has compromised the rights of individuals who legally own the intellectual property.

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  • Contract and tort law

Internet has ensured that communication is no more restricted to the constraints of geography and time. The speed and ease with which communication as well as transactions take place on the internet has led to the evolution of electronic commerce sector, which provides flexibility to business environment in terms of place, time, space, distance, and payment.

With the growth of e-commerce, there is a rapid advancement in the use of e-contracts. These e-contracts are different from the traditional paper contracts, not just in the form, but also with respect to the specific issues posed by it, for example when exactly is acceptance considered to be communicated on the internet. To address these specific issues, the courts have modified the traditional principles of contract law to adapt to the changing requirements posed by the technology.

Further, the issue of defective softwares as well as cyber defamation require specific deliberation with respect to the applicability of conventional contract and tort law respectively.

  • Jurisdiction

With respect to the issues highlighted above, one of the remedies available to the aggrieved party is to approach the court. However, internet and cyberspace has further created issues in ascertaining appropriate jurisdiction to entertain a suit. The traditional territorial principles become fallible in the computer-world as the Internet greatly diminishes the significance of physical location of the parties, because transactions in cyberspace are not geographically based and are borderless.

A cybercriminal might be a national of one country, operating his computer, in second country and hacking the computer systems of a company located in the third country. If we adopt the traditional territorial principle of jurisdiction, the country from where the cybercriminal is operating his computer will assume jurisdiction over him. But if that country does not have proper legal framework criminalising such cybercrime, then the territorial principle could be made use of for evading criminal liability, as then such criminals will necessarily locate their computers in the jurisdictions with weak or no control over the cybercrime. Thus, the effective prosecution of such a crime can be seriously hampered if proper jurisdictional principles are not evolved.

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This highlights the need to have principles which allow application of extra-territorial jurisdiction in cases of cyber crime.

[1] Computer Misuse Act, 1990 (United Kingdom), Information Technology Act, 2000 (India) etc.

[2] Universal Declaration of Human Rights, 1948, Art. 12; International Covenant on Civil and Political Rights, 1966, Art. 17.

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Artificial Intelligence and Copyright Protection of Computer-Generated Works

Copyright is a type of intellectual property which provides the exclusive right to the owner to make copies of a creative work, either artistic, literary, dramatic, musical or otherwise. The creator of such creative work, or “author” has the exclusive commercial rights over the work.

Artificial intelligence has great significance in the realm of creative work. Recent successes have demonstrated that AI can independently learn how to perform tasks, prove mathematical theorems, and engage in artistic endeavors such as writing original poetry and music, and painting original works. AI with and sometimes without human assistance is also able to create artistic or innovative works. Therefore, such interplay of AI with the creation of creative work raises certain concerns in the field of copyright law.

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Before understanding the specific issues pertaining to copyright protection of AI generated work, it is pertinent to understand the difference between AI code and AI’s work product. AI code relates to the computer program or algorithm or the source code per se which constitutes AI. This code is what the programmer inputs into an AI. Such code is provided protection under copyright laws of various jurisdictions as TRIPS agreement provides that “Computer programs, whether in source or object code, shall be protected as literary works under the Berne Convention (1971)”[1]. Therefore, the programmer, or the person/entity which buys such AI from the programmer, is considered as the owner of such AI and enjoys the fruits out of copyright protection. On the other hand, AI’s work product relates to the creative product created by the AI. The major legal issue concerns the copyright protection provided to the work created by AI, either with or without human interference.

As discussed above, the AI’s creative work product can further be bifurcated into two categories, one where there is no human intervention, and the other where the programmer has minimal input into the final product. The legal issue pertains to whether in the former situation, the AI can be given authorship over the creative product, and in the latter situation, whether AI can be considered as a co-author of the creative work.

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With respect to the first issue, the jurisprudence developed in different jurisdictions clarify the situation as they unanimously believe that the creative works generated solely by AI are not copyrightable, if such creation does not involve any input or intervention by a human author.

In the United States of America, human authorship is the basic requirement as the Copyright Office reinforced the decision in New Idea Farm. Equip Corp. v. Sperry Corp[2] by holding that it will not register works produced by a machine or mechanical process if there has been no creative input or intervention from a human. Further, in Naruto v Slater[3], the court has opined that a non-human cannot hold copyright and hence cannot sue for infringement of copyright.

In the United Kingdom, the Copyright Designs and Patents Act, 1988 provides that the author of any literary, dramatic, musical or artistic work created by a computer is the person that made the arrangements necessary for the creation of the work undertaken[4]. A computer-generated work has further been defined by the Act as “work generated by computers without any human author of the work[5].

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India also adopted a similar approach under Section 2(d) of the Copyright Act, 1957 by providing that “in relation to any literary, dramatic, musical or artistic work which is computer-generated, the person who causes the work to be created.”[6] However, it does not contain any explicit exclusion of interference from human author for computer-generated works.

Therefore, the copyright law regime of different jurisdictions expressly mention that the author of a computer-generated work is the person by whom the arrangements necessary for the creation of the work are undertaken.[7] Therefore, intervention by a human is necessary to render the output of an AI copyrightable.

Therefore, AI cannot be an author of the creative work. However, if we take this proposition into consideration, then the next issue arises as to who would be an author of the work created by AI if no human intervention takes place in the process of such creation?

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Let us consider a situation wherein an AI creates an artistic work without any human intervention and this work is infringing the right of another author of same/similar work. Even though work created by AI without any human intervention is not given copyright protection, however, does it imply that others also lose their right to sue for copyright infringement? To resolve such conflicts and the issue of liability arising out of the works created by AI, it is imperative to understand who should be considered the author of the work created by AI, without human involvement.

A possible solution to this issue is the doctrine of principal-agent relationship. If AI is considered as a mere agent of the person (human) who has a control over it, the issue of liability will be resolved. Also, since AI is created by a programmer and it functions according to the algorithms which have been programmed into it by the programmer, such programmer can be considered a principal, and AI be considered as its agent, as AI performs the specific tasks for which it is programmed. In the course of such performance, if the AI creates a creative work, the principal i.e. the programmer can benefit out of such creation, and also be considered liable, in case of any infringement (as principal is vicariously liable for the acts of agents). Further, though compensation is considered an important factor in the principal-agent relationship, and AI cannot be “paid” by the programmer in practical sense, the AI can be considered as a gratuitous agent as a gratuitous agent acts without a right to compensation from the principal. Furthermore, the gratuitous agent owes the same duties of care and loyalty that it would otherwise owe the principal as if it were a standard agent.

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If the AI is sold by the programmer to a third person/entity, such person/entity becomes the principal and enjoys the benefits and the burdens arising out of the creation of AI.

Therefore, although the copyright law regime globally necessitates human involvement or interference for protection of a creative work, the work generated by AI without such human interference should be given protection because firstly, it would provide incentive for further creations of such nature and secondly, it would provide a remedy to the party whose rights have been infringed by the creative work of AI. Thus, the principle of principal-agent relationship between the programmer and the AI can help in addressing these lacunas.

 

[1] Supra note 3.

[2] Supra note 7.

[3] Naruto v. Slater, 2018 WL 1902414.

[4] The Copyright Designs and Patents Act, 1988, s. 9(3) (United Kingdom).

[5] The Copyright Designs and Patents Act, 1988, s. 178 (United Kingdom).

[6] The Copyright Act, 1957, s. 2(d) (India).

[7] Ireland, UK, New Zealand, South Africa, and India.

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Role of Private Equity in the Construction Industry

By: Divya Tandon

What is Private Equity Investment?

Private Equity is one of the methods of financing an entity wherein capital is invested by private set of investors into a business in return for equity in the company wherein the capital is invested.

Private Equity investors are generally leveraged buyout funds, growth equity funds, venture capital funds, real estate investment funds, special debt funds or individuals having high net worth etc.

Private Equity Investors provide funding to the companies they invest in which help in meeting the capital requirements of the companies for funding their projects, pay off existing debts, solidifying the balance sheet, launching new projects etc.

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Due to huge size of investment, private equity investors often get involved in the functioning of the company and have a significant control and decision making rights in the company they invest in. The Private equity investors uses their enormous experience and skills to manage and improve the operations and revenue of the investee company over a period of time. The intent of the private equity investors is to improve the worth of the company so that they can later sell their stake for more than it was when they bought it thereby making profit.

Importance of Private Equity in the Construction/Real estate industry

The construction companies/firms require huge funds for their projects. Most companies/firms are not self-sufficient to fund their projects on their own. Hence, they look for alternative investment options to fund their projects. The construction companies can approach the banks for availing loans, look for joint venture partners, find suitable individual investors willing to invest in the form of equity or debt or private equity firms willing to invest in the company.  Since, huge funds are required by construction companies, most of the times the companies adopts more than one of the investment options to fund their projects.

Earlier, private equity investors used to avoid investment in construction industry due to certain inherent risks.  However, in recent years investment by Private Equity investors has gained momentum. The enactment of Real Estate (Regulation and Development) Act, 2016 (“RERA Act”) which has come into force with effect from May, 2017 has also made developers more accountable as their acts are now regulated by the RERA Authority. The RERA Act is more stringent as compared to previous legislation which has been brought to eradicate the problems that were inherent in the real estate sector. The RERA Act ensures transparency with respect to real estate transactions. Heavy penalties are imposed on the developers for violation of the provisions of the RERA Act or the terms and conditions of the agreement executed with the customers. Hence, RERA has brought in positive transformation in the real estate sector and boosted the confidence of private equity investors to invest in this sector.

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Besides the enactment of RERA Act, various other government policies and schemes have led to surge in investor interest in the real estate sector including foreign investors. Some of the policies of the government which has boosted private equity investment in construction industry are easing of FDI regulations, Housing for All, Affordable Rental Housing Complex Scheme, Credit Linked Subsidy Scheme (CLSS) to name a few.

Private Equity firms often fund real estate companies and provide financial support in development of real estate projects. Private equity investment provides the required liquidity to the company for its projects and provide support in launching new projects or to complete the pending projects. After enactment of RERA, the developers prefer completing their projects as per the agreed timelines to avoid payment of interest on the amounts paid by the customers. But due to liquidity crunch, sometimes the developers struggle with the available capital to complete the ongoing projects and provide possession to the customers. In such a scenario, the private equity investors come to the aid of the construction companies to provide last stage funding. Thus, the demand for funds in the last stages of completion of projects have risen. The last stage funding is also favorable for the private equity investors as it is comparatively less risky as during the last stages of construction generally necessary approvals are in place and construction is on the verge of completion. However, the private equity investors should ensure proper due diligence to understand the reason for the project being stalled. If the project is stalled only due to financial crunch, the investment by the private equity investors can help in reviving and completing the project and provide benefit to the investors by maximizing their value. On the other hand if the project where the private equity investor is considering to invest is stalled due to some third party dispute or pending litigations then the funding by private equity investors may not solve the problem and the project may not be completed as per the estimated timelines. This may result in the investment of private equity investors getting stuck.

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“Post the liquidity crisis in NBFCs in Q4 2018, private equity players including the domestic ones have become increasingly active once again and are expected to bridge the funding gap”[1]

In recent years, private equity investors are funding some major projects. The investment by private equity investors is not only in residential projects, but also in commercial and retail projects.  Due to the private equity investment, some of the stalled projects have been able to see the light of the day and have been completed, providing much needed relief to the customers who had invested in such projects.

Depending on the size of investment, the private equity investors get involved in the decision making process. The level of influence depends on the stake invested. They provide their inputs through out the development process and act as strategic partners.

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Impact of Covid-19 on the private equity investment in the construction industry

Due to the outbreak of the global pandemic Novel Corona Virus – COVID-19 in March, 2020, the current financial markets, trade, commerce and thereby business continuity is facing an unprecedented situation due to lockdown imposed by the central and state governments from time to time to curtail the spread of the deadly virus. This pandemic has paralyzed and destroyed the very economic fabric of the entire world including India.  Both the Central Government as well as State Governments had placed severe restrictions and implemented various remedial measures in an all-out effort to halt the spread of the virus.

The impact of the Covid-19 is thus a calamity and the adverse consequences on the Real Estate Industry is serious and has impacted the business severely. As a fall out of the above, there is total disruption in the supply–chain of materials, shutdown of construction activities due to huge shortage of construction materials in the market on supply–chain issues due to import restrictions, global manufacturing, shutdown of materials, heavy escalation in prices of materials etc. The site labourers had returned back to their native homes/villages due to the fear of contracting the virus due to which construction sites had either substantially slowed down or had come to a grinding halt. Since the real estate as an Industry being the most labour intensive, being extremely reliant on hundreds of materials coming from everywhere in projects and reliance on stable financial inflows into the projects; all these either being slowed / unavailable / stalled in most projects, severely affected current ongoing projects of the most real estate developers. The sale of residential/commercial premises had also been affected due to liquidity crunch in the market.

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It is also learnt that across the real estate industry, almost 60% – 65% of flat purchasers are defaulting in paying their due instalments to the companies towards the flats booked by them thereby further adversely affecting the business of the construction firms. The developers however on the other hand are without any respite/remedy in terms of payment of instalments towards huge loans taken from banks as well as payment of taxes and premiums to the various departments of the Government. Under these facts and circumstances, where on the one hand the payments are not being made by customers/purchasers, the construction work being affected and standstill due to the supply chain being disrupted and the workers unable to come to work, whereas the developers having to make payments towards service of finance loans, taxes, premiums etc. entire real industry is under the grave stress.

The outbreak of the Covid-19 and the forced lockdown (by the competent Government/Authorities) pursuant thereto, was a sudden setback to real estate sector which was already going through a rough patch due to low demand. Thus the construction industry is facing challenging times due to the drastic impact of the pandemic. The real estate industry is facing financial crunch to launch new projects and also to finish ongoing projects. Though, the restrictions have been relaxed by the governments, the impact of the Covid-19 and lockdown will be felt for months to come. Many construction companies are on the verge of bankruptcy. In such a scenario, private equity investors can come to the rescue of the severely hit real estate entities/firms.

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In recent times many private equity investors are in negotiation talks with construction companies to provide much-needed funding for their projects.

Recent trends

“Indian real estate attracted U$ 5 billion institutional investments in 2020, equivalent to 93% of transactions recorded in the previous year. Investments from private equity (PE) players and VC funds reached US$ 4.06 billion in 2020. The real estate segment attracted private equity investments worth Rs. 23,946 crore (US$ 3,241 million) across 19 deals in Q4 FY21. Investments in the sector grew 16x compared with Rs. 1,470 crore (US$ 199 million) in Q4 FY20. In value terms, these investments were 80% of that in 2020 and 48% of 2019, according to a report by Knight Frank”[2]

As per the reports from the property consultant, Savills India “Private equity investment inflows into the Indian real estate sector stood at $2.7 billion during the first half of 2021 as investors’ confidence remained intact despite the pandemic-induced slowdown. This inflow is equivalent to 41 per cent of the investment that the sector saw in the entire year of 2020. However, in the second quarter of 2021, Indian real estate market saw an investment of $865 million, a 54 per cent decline from the previous quarter.”[3]

As per Colliers’ report Investments Turbocharged with Focus on Alternate Assets Classes “Despite COVID-19, the total expected private equity inflows in the Indian real estate sector is expected to touch $5 billion in 2021, a 4.1 percent increase from 2020” [4]

As per ICRA estimates, Indian firms are expected to raise more than Rs. 3.5 trillion (US$ 48 billion) through infrastructure and real estate investment trusts in 2022, as compared with raised funds worth US$ 29 billion to date.[5]

According to the data released by Department for Promotion of Industry and Internal Trade Policy (DPIIT), construction is the third-largest sector in terms of FDI inflow. FDI in the sector (including construction development & activities) stood at US$ 50.8 billion between April 2000 and March 2021.[6]

Thus it can be seen from the above that the private equity investors both domestic and foreign have gained confidence in the Indian construction industry and have joined hands with some of the major construction companies to boost the growth of the sector.

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[1] As per the report of Savills on Private Equity in Indian Real estate

[2] https://www.ibef.org/industry/real-estate-india.aspx

[3] https://economictimes.indiatimes.com/news/india/indian-realty-attracts-2-7-billion-private-equity-investments-in-january-june-report/articleshow/84339543.cms?from=mdr#:~:text=Private%20equity%20investment%20inflows%20into,from%20property%20consultant%20Savills%20India.

[4] https://www.moneycontrol.com/news/business/real-estate/no-covid-19-impact-private-equity-inflows-into-indian-real-estate-sector-to-touch-5-billion-in-2021-7195641.html

[5] https://www.ibef.org/industry/real-estate-india.aspx

[6] https://www.ibef.org/industry/real-estate-india.aspx

 

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Role of IP in the Media Industry

By: Ilakkiya Kamaraj

Introduction: 

“Is there anyone who hates entertainment?” The media has never stopped entertaining us. It plays an important role in our lives from fascinating us through films to feeding our brains with up to date information about the happenings in the world. From one corner of the world, we can know the happenings of another part of the world through media. That too in this internet world we can access each and every information or watch films through phones anywhere and everywhere. Media is such a wide area which plays an important role in our lives needs a sort of protection for the work of its people’s work. Such protection can be given to media by Intellectual property. Intellectual property protection is used in various fields. In this paper, we are going to see how IP’s role is important in protecting the works of media.

Intellectual property:

The ownership of any creation of the mind or ideas or designs by a person is known as Intellectual property. IP can be categorized into many types but the most widely used IP are patents, trademarks, copyrights and trade secrets.

  • A right granted to a person for his/ her invention is called a patent. It prevents usage of one’s invention by others illegally. The inventor can sell, use, distribute, create, import or export their invention for over 20 years once his/ her work is patented.

“A person has an entitlement to an invention if that person’s contribution, either solely or jointly with others, had a material effect on the final concept of the invention”.[1]

  • Protection of logos and brand names used on various goods and services is known as a trademark.
  • Copyright is used to protect creators artistic works such as music, films, paintings, technical drawings, computer programs etc.,
  • Any secrets related to a company’s business protected, to avoid its accessible by its competitors is referred to as trade secret.

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Intellectual property is very important for protecting one’s innovation. If IP is not in use there are high chances for many individuals and businesses to lose their rights to their innovation.

Media:

The storage and delivery of information or data through various modes like radio, television, mobile phones, magazines, newspapers, internet etc., are referred to as media. The information is disseminated as films, news, music, promotional messages etc., Since media consists of artistic work from one’s own knowledge, an individual must protect his/ her work through media. There is how IP plays a very important role in protecting the works of media.

IP’s role in media industry:

We all love movies! But to make a scene and combine it into a movie involves many various complicated works. From making movies to shaping every stage of the filmmaking process Intellectual property rights play a vital role.

  1. Copyright in media:

As copyright protects the artistic ideas of individuals it is considered as the lifeblood for media. Copyright guarantees the protection of creative minds without affecting the creation of new media and protects the creators work from the usage of others without their permission. The copyright of the original material is mandatory nowadays, as a lot of competition has emerged in the entertainment industry.

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Benefits:

  • A public record of the work is registered.
  • Provides with economic benefits such as broadcasting the work, making copies etc.,
  • Filing a lawsuit and taking legal action is enabled when copyright is registered. Legal evidence of one’s own can be obtained.

Passing the rights of one’s work is allowed and one can change the form of his/her work.[2]

  1. Trademark in the media industry:

Any symbol, design, word or phrase that differentiates the goods of one company from others is referred to as a trademark. In media, a trademark is used to protect a movie’s brand or merchandise in connection to it. In media trademark law protects every title of a movie, album, music, famous characters etc., For instance, Disney has its own logo, the same goes for Pixar, discovery and many other channels as its logo to stand out from the crowd in the market. Similarly, movie titles like star wars, harry potter can also be protected using the trademark.[3]

Benefits:

  • The exclusive right of the trade can be enjoyed by the owner.
  • There will be no infringement.
  • Big brand names act as a magnet and attract young minds.

Merchandising:

Character merchandising is one of the ways to generate income. In a case where the unauthorised sale of dolls resembling a famous pop singer without their permission injunction was granted for the tort of passing off by the Delhi High Court to the third party.[4]

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  • Patent in media industry:

Just like trademark and copyrights patent also plays an important role in media. Making the film is not an easy task. It needs funding and substantial efforts. It involves lighting, sound effects, editing, special effects etc., Patent is used to protect the innovation of a person which is considered as the eye of filmmaking. By patenting, third parties are excluded from using or selling another person’s product without permission.

Benefits:

  • Restricting the competition in regards to a particular invention.
  • Inventor’s monopoly is been safeguarded with patent registration.
  • The inventor has the right of royalty when he decides to license his product.
  • Patent registration helps in start-ups and small business entities.
  • The credibility of the company in the market increases through patent registration.
  • In media to begin an industry patent registration is necessary.

Laws protecting IP in the media industry:

Therefore copyright, patent and trademark act as a shield for the media industry. Recognition of the rights of the creators and protection against infringement of content are guaranteed through copyright. Whereas the key characters of a film, movie titles and other related elements are protected through trademark. Though there are IP rights for protection, violation of IP rights, trademark and copyright are being infringed as the media industry expands.

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India being a signatory of the TRIPS agreement and other International IP treaties helps in avoidance of misuse and protection of IP. There are certain laws in India in order to prevent such misuse in the media and entertainment industry. They are.,

  • The Copyright Act, 1957
  • The Trademark Act, 1999
  1. The Copyright act, 1957:
  • Section 14 of the Copyright Act, 1957 defines copyright as the right given over a work to do or to authorise to do that work.
  • If the own work of any individual is been infringed in India then the person who infringed would be punished under section 63 of the copyright act, 1957. If a suit is pending before the civil court then the criminal court cannot give a finding on the infringement of copyright.[5]
  • The Bombay High Court held that the act of the infringer will be preposterous if he attributed infringement without knowing that owner of the copyright has registered under section 44 of the Act.[6]

De minimis infringement:

The principle of “de minimis non-curat lex” that is “the law does not concern itself with trifles” applies to copyright. A court has the authority to apply the de minimus principle in a lawsuit if it is of trivial matter. For instance, the De minimus doctrine is used in music sampling where a music w is modified by sound engineers from a small portion of music work and incorporated in new musical work.[7]

In the case of the India Independent News v Yashraj Films Pvt Ltd[8]., the doctrine of De minimus was applied to decide copyright infringement where parts of popular songs were played in a singer’s interview who appeared on a television chat show. It was held that it was not actionable as the alleged infringement was deemed de minimus.

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  1. The Trademark Act, 1999:

Under the trademark act, the name of songs, music albums, movie titles and their famous characters are being protected.

Conditions:

There are few conditions for the protection of titles and symbols under the trademark act. They are;

  • There must be originality of titles and phrases. Titles should be unique; if not the general ones will not be protected under trademark.
  • Single film titles will not be trademarked. Series of films such as harry potter, Narnia and series like F.R.I.E.N.D.S, money heist etc., can be protected under trademark.

Social media and IP:

The Internet has grown so fast with the evolution of time. In the early days, there was only a television mode of media. And therefore the risk of infringement has been less. There are plenty of content creators on online platforms nowadays. For example youtube. Online platforms also follow strict policies such as copyright verification programs, copyright strikes etc.,

The Bombay High Court held in the case of the Marico Limited v Abhijeet Bhansali[9], that the suit constituted by the defendant cannot be taken into legal action has his video was just his opinion.

Rights of celebrities:

Celebrities’ images are used without their knowledge and have been misused. Both copyright and trademark act protect celebrity rights in India. In addition to these, the Universal Declaration of Human Rights also tries to protect celebrity rights.

Under copyright act sections 38 and 39 covers celebrity rights.

Section 38 of the copyright act- the performer’s right is provided to any performer concerning his performance for fifty years.

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Section 39 of the copyright act- a person will be held liable for infringement if he takes the recording of the performance of the performer without his consent.

Conclusion:

IP plays a major role in keeping the media industry running smoothly without any problem. Movies are protected through IP. Everything we experience, hear or see-through media is covered by IP. Intellectual property and media should go hand in hand. If IP is not there media would have been at high risk. Everything from television serials to Netflix series involves huge funds and labour of various people such as cameraman, director, producer, screenwriter, actors etc. Therefore protection of such work from infringement is mandatory. Such a role of protection can be given only by Intellectual property. Therefore intellectual property plays a very important and dominant role in the media industry.

[1] Row Weeder Pty Ltd. v. Nielsen, 39 IPR 400 (1997).

[3]CS Prachi Prajapati, Advantages Of Registering Trademark, LEGAL WIZ (Jul. 31, 2017, 11:15 AM), https://www.legalwiz.in/blog/advantages-of-registering-trademarks.

[4] DM entertainment v. Baby Gift House, MANU/DE/2043/2010.

[5] Cheran P Joseph v. K. Prabhakaran Nair, 1517 CriLJ  (1967).

[6] Dhiraj Dharamdas v. M/s Sonal Info Systems Pvt Ltd, 3 MhLJ 888 (2012).

[7] De Minimus Use, USLEGAL (Aug. 25, 2019, 09:30 AM), https://entertainmentlaw.uslegal.com/intellectual-property/copyright/de-minimis-use/.

[8]  53 PTC 586 (2013).

[9] 1094 COMIP 596 (2019).

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Analysis of Civil Procedural Laws in U.S.A. and U.A.E

By: Shirleen Kaur

ABSTRACT

Laws are generally divided into two major heads i.e., substantive law and the procedural law. Both the heads are considered together as one is purposeless without the other. The former contains the rules and regulations, characteristics of laws with bare acts of those laws. While the latter one gives an approach on how to implement substantive laws. Essentially, the judicial structure is divided into two kinds of case matters: civil and criminal. Hence, a study of Civil Procedure is basically a study of the procedures the substantive statues that are not criminal.

INTRODUCTION

United Arab Emirates (UAE) has arisen to be one of the main powerhouses in economically aspect in Middle East. With time has also recognized the need of modernizing its laws as the growth of commercial contracts continues to increase as well. Despite that the ambiguous global changing nature of the world cannot be brushed aside when it comes to emerging markets, Dubai’s economic and dynamic cultural growth. These factors cannot be strengthened if legal and regulatory framework has not been developed and continue to develop sufficiently to encourage substantial internalized local and international enterprise in Dubai. It is well established that there is immense analysis done while deciding willingness to set up international businesses. Legal and regulatory framework has a major role to play in it as most pf the decision is based on their suitability of country’s legal framework. American philosophers have a major part in making civil procedure to be especially substantial. The civil procedure rules are so important as it is correlated to larger American norms. This loyalty for procedural to be ideal in due process explains how USA law makers have faith in individualism promoting a requirement for legal framework to proclaim that every claimant will get individualized justice. Consequently, this even reflects what is the USA’s cultural view regarding civil disputes. They follow the approach that there is supposed to be a winner and losers whenever a dispute arises rather than having a negotiation resolution approach.

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UAE CIVIL LAW PROCEDURE

United Arab Emirates was affirmed as independent, united and a sovereign state comprising seven emirates. Relevantly, just like Indian legal system is based on Indian Constitution likewise, UAE legal system based on its the constitution. UAE legal system is a dual nature as it has local and federal courts together with a Supreme Court. “Civil Procedure Law” has been issued under Federal Law No. 11 of 1992 which is followed accordingly by the UAE courts to adjudicate all the civil matters.

  • Sources of civil laws in UAE

The main ideas and beliefs of the United Arab are taken from the Sharia law. Although, most laws entail a combination of European and Islamic notions of the civil law whose source is that the Egyptian legal code created within the 19th and 20th century. The adoption of civil law by variety of states within the area exhibits the French influence.

In Addition, having a specific legal legislation for all the agencies particularly of labour law, company law, and intellectual property, United Emirates has over the time recognized commercial and civil codes. This formation has facilitated some expansion in civil legal systems to be more structured and complete. Every new structure may affect someone in some way or the other as a consequence, it can be interpreted as inflexible sometimes. This rigidity has brought the same to some extent when it comes to establishing the job work linked to numerous countries within the geographic region. The UAE functions under a civil law system and acts are the first source of law.

The other thing that may differentiate the legal system of UAE from other countries would be that the Judgments of the higher courts don’t seem to be obligatory on the lower courts (although they could be a beneficial guide and often cited for backing of a position). Each case is set on its own advantaged and facts.

NATURE

All court proceedings in UAE courts follow Arabic language. If there are any non- Arabic documents that are to be filed in the Court, needs to be converted into Arabic by a professional translator certified by the Ministry of Justice.

Correspondingly, the system within the UAE is fundamentally investigative in nature. In each case, the judge would prefer investigating the facts (generally through an expert allocated by Court) and apply the law to detailing of the facts of the case in reaching their judgment. There has never been a discussion of introducing a jury trial. All proceedings in UAE civil cases are supported with the written pleadings of the parties and reinforced by all the documentary evidence admitted. In general, there is no oral hearing in civil cases. There is a common practice which is prevalent for both the federal and also the Dubai courts to refer the matters to court-appointed experts for appropriate conclusions of fact in order to help in variety of expertise areas.

Even though, the judgement is followed, but importantly the concept of cease-and-desist order isn’t practiced in UAE. However, if after a while evidence is further submitted, the court may grant extension of the time supported by the request of the parties concerned treated as the additional submissions made by parties.

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The temporary remedies that are provided in UAE, are orders such as prohibiting the defendant from leaving the UAE or an order with relevance of surrendering of the passport by the defendant. These interim reliefs may be sorted if the claimant believes that the defendant might leave the concerned jurisdiction.

After a judgement is given, the judgment holder will start execution proceedings, and once this process is initiated, the debtor of the judgment shall receive a notice and they shall be expected to pay the debt, and if it isn’t fulfilled within the prescribed time then further execution proceedings commences. Then there are chances that the court may order attachment and sale of the concerned debtor’s property and even attachment of shares, bonds, stocks etc. In exceptional rare cases, imprisonment may also be passed for stricter approach to condemn violations.

Unlike India, there is no provision mentioned in UAE law regarding mandatory and prohibitive injunctions.  The applying for an attachment order of debtors’ assets is the only method that resembles to an injunction given in Indian Courts.

  • In the matter of Commercial disputes in UAE, they are resolved through either Litigation or Arbitration. The UAE is signatory to the UN convention on for the interest related to foreign arbitral award. Apart from arbitration, concepts which comes under the umbrella of arbitration such as conciliation and mediation are not that developed which means that these methods are not practiced like that in India. Although ADR may be considered a useful method for
    resolving the commercial disputes, but the need has not been recognized under UAE laws as no statutory framework exists which enforces ADR at large scale as a most vital method for resolving commercial disputes[1].Bottom of Form

USA CIVIL PROCEDURE LAWS

Civil proceedings in the United States district courts are governed by the Federal Rules of Civil Procedure.  The substantial purpose is “to secure the just, speedy, and inexpensive determination of every action and proceeding.” [2]These rules were first adopted by order of the Supreme Court in 1937 and came into effect in 1938. The latest amendment of Civil Regulations was in 2020.

  • Sources of laws in USA: US Rules has composed the complex laws to specifically talk about how “it exists in different forms at every level of the government. To start with laws in US exist not only in the statutory form, but also the common laws that are formed through the judiciary.” [3]

Therefore, what distinguishes the sources of laws in USA in simple terms can be covered within the following.

  1. Constitution of USA and its Statutes
  2. Common laws
  3. Executive action
  4. Administrative directive
  5. Law of equity

Thus, the abovementioned sources of US laws identify the fabric of its governance in the society,

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Constitution and statues: “A constitutional law in USA constitute unique forms of various states. Constitution as it can be understood are the laws of the people, which is different from ‘statues’, constitution cannot be changed or amended, however, changes to statues can be amended in accordance to change in the society. Moreover, statutory is held responsible by the US congress at the federal level,” [4]

Administrative and Executive laws come from different sources referred in Code of Federal Regulation (CFR) and the federal US government respectively.

Common Law and equity laws: these laws are looked upon as providing common platforms of opinions that should be able to make sure that all parties leave during trial proceedings.

NATURE

Legal action plays a broader role in the United States than any other countries. US system of rules provide constructive remedies to parties and is well recognized for its confrontational nature.

American procedural law has advanced class action measures that have no counterparts in the procedural law of Civil-Law authorities and go well beyond the practices of most other Common-Law authorities. As a consequence of an administration of intricate legal procedures that is so distinctive of the American legal system, regular citizens are less capable of handling their disagreements on their own, and more reliant on upon engaging the services of lawyers. Many think, for instance, disputes over auto accidents and the acquisition and sale of homes and apartments should be figured without lawyers. Yet, in most states in the Unites States the unsolved practices that now functions are the simple matters that could force people to turn these problems over to lawyers.

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Generally, in all civil cases, suits filed are initiated by the plaintiff where cases are decided by a judge or if any significant suit is presented then juries may be involved. As similar to other countries, punishments of civil nature cases are almost always of a monetary nature and not of imprisonment. Defendants’ liability has to be established by the plaintiff after and according to “preponderance of evidence”.

Sometimes, the charges against the defendant may constitute both a civil charge and a criminal charge if the particular wrongful act consisted of both a private injury or a public offense.

Generally, below mentioned stages are followed in a civil suit including the process followed within those stages:

  • A lawsuit is initiated by the plaintiff filing a complaint.
  • A reply is filed by the defendant against the complaint.
  • A scheduling order is then issued by the judge arranging out a timeline for case proceedings which may include the initiation of trial.
  • Motions by the parties and other pleadings may be filed.
  • A jury is then selected to begin the trial proceedings.
  • After hearing both the parties, a decision is then given by either by the jury or the judge.
  • The aggrieved party after the decision may file for an appeal in the appellate court which may prefer for further appellate review.

ANALYSIS

After comprehending UAE and USA laws, it can be realized that both countries’ civil laws are fundamentally different from one another. Laws which are applicable in UAE might not be similar in US. For an instance, if we take administrative laws prevailing in both nations, in US, administrative laws are regulated under code of federal regulation, on the other hand in UAE, the civil code is defined in each state in a separated form. Nevertheless, the UAE follows Sharia law, an Islamic law having it relevance in administrative laws or civil code. Thus, there can be seen a significant difference in both nations and their prevailing administrative laws.

The constitution and the statue in US are considered to be supreme due to which it can be said that it can be held responsible by the US congress at the federal level. Whereas, in UAE in that regard, the Federal Supreme Court is supreme. Although interestingly UAE and USA common laws are somewhat in forms and few parts similar to one another. As an example, UAE common law legislation has an influence of English common laws and in USA common laws, the definition of liberty is also paramount.

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Another similarity is related to media laws in specific, wherein UAE, the judiciary plays a substantial part in order to provide a solution relating to disputes of any in a civil nature and relevantly in USA such media laws are considered to be form of civil laws under the common heading of ‘common’ and ‘equity’ laws in the society specific to media regulation.

The hesitancy of civil laws of USA to imply good faith into agreements while negotiating amongst two commercial parties is widely known and mostly based on the traditional doctrine. The doctrine Is called doctrine of freedom contract in similarity with English Common Law. In contrast to USA, civil law in countries such as the UAE, they follow fulfilling obligations in such a manner that is consistent with good faith recognized as a fundamental part of the contract.

CONCLUSION

The civil law of UAE follows an interrogative approach which is usually applied by the bench. The courts follow litigation to be entirely court-driven where they have the control over hearing schedules, appointment of experts and so on. The judge hearing the case have absolute discretion in any case for the final decision. As far as the UAE courts are in question, they do not particularly adhere to traditional common law standards of evidence, for instance the “likelihood test” in civil claims or the “beyond reasonable doubt” in criminal matters.

USA can be said to be more liberal country so most of its laws also classify themselves in the same bracket. Subsequently, if we consider societal sphere and their cultural domain between these countries there would be quite a disparity. That being said, nearly all of the laws that are applicable in USA might not be applicable in UAE. However, with a few similarities to common laws, it just indicates that common laws are universal in nature. The major difference even so would be few laws which would UAE laws in general to not strengthen be it due to societal, cultural, or traditionally not applicable.

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[1] International Journal for Legal Research & Analysis, Pavan Kumar,R, June 2021

[2] Fed. R. Civ. P. 1.

[3] Jennings, 2005, p. 20

[4] Jennings, 2005, p. 20