2013 (10) TMI 240 - HC - Companies Law

Jurisdiction of Court - Infringement of copyright and trademark - Held that - For the purposes of a passing off action, or an infringement action where the plaintiff is not carrying on business within the jurisdiction of a court, and in the absence of a long-arm statute, in order to satisfy the forum court that it has jurisdiction to entertain the suit, the plaintiff would have to show that the Defendant purposefully availed itself of the jurisdiction of the forum court. For this it would have to be prima facie shown that the nature of the activity indulged in by the Defendant by the use of the website was with an intention to conclude a commercial transaction with the website user and that the specific targeting of the forum state by the Defendant resulted in an injury or harm to the plaintiff within the forum state - It is possible that the goods manufactured by the plaintiff are available in the market of Delhi or they are sold in Delhi but that by itself would not mean that the plaintiff carries on any business in Delhi. The broadcast of the plaintiff s programs in Delhi is also not sufficient to confer jurisdiction. Just as mere advertisement in a journal or paper is not sufficient to confer jurisdiction - Similarly, broadcast of the plaintiff s programmes is insufficient to vest jurisdiction in this Court - Decided against petitioner.

Summary

Issues Involved:
1. Territorial Jurisdiction
2. Infringement of Copyright
3. Infringement of Trademarks
4. Passing Off
5. Dilution
6. Rendition of Accounts
7. Damages and Delivery up

Detailed Analysis:

1. Territorial Jurisdiction:

The primary issue was whether the Delhi High Court had territorial jurisdiction to entertain the suit filed by the plaintiff, a foreign company, against the defendants based in Mumbai. The plaintiff invoked the jurisdiction under Section 134(2) of the Trademarks Act, 1999, and Section 62(2) of the Copyright Act, 1957, claiming that it carried on business within the jurisdiction of the court due to its programs being broadcast in Delhi, its products being available in Delhi, and its website being accessible in Delhi.

The court referred to the Supreme Court's judgment in Dhodha House Vs. S.K. Maingi, which clarified that to "carry on business" at a place, an essential part of the business must occur there, with the plaintiff having some control over the business activities at that place. The court also cited the Division Bench judgment in Archie Comic Publications, Inc Vs. Purple Creation Pvt Ltd, which followed Dhodha House, emphasizing that merely selling goods in a place does not establish that the plaintiff carries on business there.

The plaintiff argued that the advent of new media and internet-based business models should be considered, citing the case of Yahoo, Inc Vs. Akash Arora, which acknowledged the transcendental nature of internet business. However, the court held that the criteria laid down in Dhodha House still applied, requiring an essential part of the business to be carried on at the relevant place, with some control exercised by the plaintiff.

The court concluded that merely having a website accessible in Delhi, broadcasting programs in Delhi, or having products available in Delhi did not satisfy the criteria for carrying on business in Delhi. The court emphasized that the plaintiff needed to show actual and substantial business interest in Delhi, which it failed to do.

2. Infringement of Copyright:

The plaintiff alleged that the defendants were infringing its copyright by manufacturing and selling counterfeit goods bearing the plaintiff's copyrighted images and characters. The court did not delve into the merits of the copyright infringement claim due to the lack of territorial jurisdiction.

3. Infringement of Trademarks:

The plaintiff claimed that the defendants were infringing its registered trademarks by using reproductions of the plaintiff's talents and logos on their products. The court, however, focused on the jurisdictional issue and did not address the merits of the trademark infringement claim.

4. Passing Off:

The plaintiff alleged that the defendants were passing off their counterfeit goods as those of the plaintiff, thereby causing confusion among consumers. The court did not examine the passing off claim due to the jurisdictional issue.

5. Dilution:

The plaintiff contended that the defendants' actions were diluting the distinctiveness of its well-known trademarks. The court did not address this issue, as it primarily focused on the question of jurisdiction.

6. Rendition of Accounts:

The plaintiff sought an order for the rendition of accounts to ascertain the profits made by the defendants from the alleged infringing activities. The court did not consider this request due to the jurisdictional issue.

7. Damages and Delivery up:

The plaintiff sought damages and an order for the delivery up of the infringing goods. The court did not address these claims, as it determined that it lacked jurisdiction to entertain the suit.

Conclusion:

The court held that it did not have territorial jurisdiction to entertain the suit, as the plaintiff failed to demonstrate that it carried on business in Delhi within the meaning of Section 134(2) of the Trademarks Act and Section 62(2) of the Copyright Act. Consequently, the court directed that the plaint be returned under Order 7 Rule 10 CPC to be presented before the court of competent jurisdiction.