ABC Systems contended that it has obtained design registration for its water purifiers. It added that XYZ Ltd. sells water purifiers that contained the same designe as the one used by it which amount to piracy. It furthe

CS Professional · Intellectual Property Rights - Law and Practice · PYQS · June 2021
ABC Systems contended that it has obtained design registration for its water purifiers. It added that XYZ Ltd. sells water purifiers that contained the same designe as the one used by it which amount to piracy. It further added that XYZ Ltd. sells these water purifier on E-bay (an intermediary). ABS systems approaches the court to state that if E-bay (the intermediary) does not remove many of the listings that were violative of plaintiff's rights, issue an order for delisting the infringing material as well as a prohibited injunction to prevent such listings from being public in future. E-bay (intermediary) stated that it has no difficulty accepting plaintiff's prayer that all infringing content be removed as spoken as it is brought to its notice. The plaintive argue that E-bay, being an intermediary, is obligated to institutionalise a system to assertain whether or not the content that it is publishing is of an infringing character and to refrain from publishing the content if the answer to this question is in the affirmative. The plaintive sort to draw sustenance from rule 3 of the Intermediary Guidelines which imposes and obligation on intermediaries to maintain due deligence and section 79(3) of the Information Technology Act which makes the safe harbour that intermediaries enjoy inapplicable in circumstances when they aided abet or conspire or induce the commission of an offence. In response, E-bay relied on section 79 of Information Technology Act in support of its argument that its action would be covered with in ten four squares of the provisions which shilled from the gauntlet of legal liability the conduct of and intermediary which meagrely surveys as a conduit for the receipt of the information and does not interfere with the information in any way. Can E-bay (an intermediary) be compelled to screen contents allegedly violative of intellectual property laws on an ex ante, in contradiction and ex-post, bases? Give reason in support of your answer.

Answer & Explanation:

Internet intermediaries refer to entities which provide services that facilitate people to use the internet. They include network operators, network infrastructure providers, internet access providers, internet service providers, social networks, search engines and aggregators etc. These online platforms were supposed to be regulating themselves to prevent unlawful content appearing in them. Therefore, the intermediaries were given 'safe-harbour' against third party content. The intermediaries are exempted from liability under the section 79 of the Indian Information Technology Act if the offence or contravention was committed without their knowledge or that they had exercised all due diligence to prevent the commission of such offence. Therefore, the intermediary is protected from copyright infringement if they were not aware that the hosted content was copied material. The section 79 of the Indian Information Technology Act containing the "safe-harbour provision" was amended in 2008. The definition of intermediary was broadened to include the telecom and internet service providers, search engines, online marketplaces and cyber cafes. The safe-harbour protection was extended to all intermediaries. In order to prevail, in the present case, the plaintiff would have to explain how the Intermediary Guidelines spell out an obligation upon Intermediary to screen contest to ascertain if it is of an infringing character. A bare perusal of the rules reveals that Intermediaries are only bound to apprise users of their privacy policy/rules and regulations and to disable infringing content on being informed of its existence. The court reasoned that to accept the plaintiff's prayer would result in converting the Intermediary into a body to determine whether there is any infringement of intellectual property rights or not, a role which intermediaries are ill equipped to perform. Such an obligation upon intermediaries would result in them being compelled to test all the materials sent to them for publication vis-a vis claims of infringement of intellectual property in order to avoid liability. If the intention of the legislature was to cast such an obligation upon intermediaries, the guidelines would have imposed absolute embargo on hosting infringing content. In the light of the fact that no obligation to screen infringing content is imposed on the publishers of the newspapers or the owners of immovable property, the court ordered that it would be inappropriate to such an obligation on intermediaries who are similarly situated as the aforesaid service providers. In fact, in the case of Kent RO Ltd v. Amit Kotak & Ors (2017) , Kent RO Systems filed for permanent injunction against one Amit Kotak for infringing its intellectual property rights by copying its designs and eBay India Pvt Ltd. for aiding the infringement by allowing the respondent to sell its product on their website. The court held that compelling an intermediary to screen content would amount to "an unreasonable interference with the rights of the intermediary to carry on its business. With reference to trademark infringement, the Delhi High Court prescribed a few guiding principles on intermediary liability and outlined twenty six tasks that an intermediary may carry out in Christian Louboutin SAS v. Nakul Bajaj and Ors (2018) . In the above case, the defendant was accused of selling counterfeit products through the website Darveys.com. Further, it was alleged that the defendant used the plaintiff's name as "meta tags" in the said website thereby infringing the trademark rights of the plaintiff. The court held that the benefit of safe harbour provisions under Section 79 of the Information Technology Act could not be extended to an intermediary which actively participated in a transaction which amounted to infringement of intellectual property rights.

Topics: Information Technology Act

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