CS (OS) 2414/2011. Case: Tekla Corporation & Anr. Vs Survo Ghosh & Anr.. High Court of Delhi (India)
| Case Number | CS (OS) 2414/2011 |
| Counsel | For Appellant: Ms. Safia Said, Adv. and For Respondents: Mr. Kaustubh Sinha, Adv. |
| Judges | Rajiv Sahai Endlaw, J. |
| Issue | Copyright Act, 1957 - Sections 14, 16, 2(y), 31, 31(A), 31(B), 31(C), 31(D), 51, 52, 60, 63 |
| Judgement Date | May 16, 2014 |
| Court | High Court of Delhi (India) |
Judgment:
Rajiv Sahai Endlaw, J.
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The question, whether in a suit for permanent injunction restraining the defendants from infringing the copyright of the plaintiffs, a defence of "copyright misuse" is available to the defendants, is for adjudication.
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The two plaintiffs i.e. Tekla Corporation, Finland and Tekla India Pvt. Ltd. have sued the two defendants i.e. the defendant no. 2 M/s. Caliber Tech Solutions Pvt. Ltd. and its officer defendant no. 1 Mr. Survo Ghosh pleading, that the plaintiffs have a copyright in software programme known as Tekla Structures and the defendants, instead of obtaining license thereof from the plaintiffs, have unauthorizedly installed the same.
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Summons of the suit were issued and vide ex parte ad interim order dated 27th September, 2011 the defendants were restrained from reproducing/storing/installing and using unlicensed/pirated versions of plaintiffs' software or from otherwise infringing the copyright of the plaintiffs and a Court Commissioner was appointed to visit the premises of the defendants to verify the infringement if any in the past by the defendants.
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The defendants have contested the suit by filing a written statement. On 2nd December, 2013 issues were framed in the suit. The counsel for the defendants pressed for framing of the following issue as well:-
Whether the conduct of the plaintiffs constitutes copyright misuse. If in affirmative, whether the plaintiffs are precluded from claiming a relief based on alleged infringement of such misused copyright? (OPD)
and invited attention to the averments in preliminary objections 4 & 5 in the written statement of the defendants. The counsel for the plaintiffs opposed the framing of such an issue contending that there is no legal doctrine of "copyright misuse" on which issue was claimed by the defendants. Accordingly, the suit was adjournment for hearing arguments on the said aspect.
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On 14th March, 2014 the counsel for the defendants referred to the following judgments:-
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Judgment dated 16th August, 1990 of U.S. Court of Appeals, Fourth Circuit titled Lasercomb America Inc. Vs. Reynolds;
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Judgment dated 6th August, 1997 of U.S. Court of Appeals, Ninth Circuit titled Practice Management Information Corp. Vs. American Medical Ass'n;
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Video Pipeline, Inc. Vs. Buena Vista Home Entertainment, Inc. 342 F.3d 191 (3rd Cir., 2003);
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Judgment dated 29th January, 1999 of U.S. Court of Appeals, Fifth Circuit titled Alcatel USA Inc. Vs. DGI Technologies Inc.; and,
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Judgment dated 25th November, 2003 of U.S. Court of Appeals, Seventh Circuit titled Assessment Technologies of WI, LLC Vs. Wiredata, Inc.
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Noticing preliminary objections 4 & 5 in the written statement of the defendants as under:-
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It is submitted that the plaintiffs are involved in malpractices and restrictive conduct constituting 'copyright misuse' and are accordingly precluded from claiming a relief based on that infringement. The Copyright misuse doctrine bars the culpable plaintiffs from prevailing on an action for the infringement of misused copyright. It is submitted that the doctrine of copyright misuse prevents copyright holders from leveraging their limited monopoly to allow them control of areas outside the monopoly and acts as a limitation on licensing restrictions and related conduct that are either restrictive, anti-competitive or otherwise violate the public policy underlying the copyright law. The copyright misuse defence to infringement of copyright has been recognized as a valid defence across several jurisdictions of the world. The Defendants reserve their right to reply on the corresponding case-laws during the course of their arguments.
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It is submitted that the terms of use of Tekla Software of the Plaintiffs and their conduct during the course of the license term completely tantamounts to misuse of their monopoly provided by their copyright. The Plaintiffs have been using their copyright to charge an unreasonable fee (apart from their due license fee) in the garb of providing training and maintenance services and have been forcing their licensees to accept unreasonable conditions which include, but are not limited to following:
• Bundled maintenance service agreements for every year,
• levying huge penalties for not accepting their conditions for maintenance service agreements,
• bundling training fee with the license of the software,
• not providing proper training despite taking payment for the same etc.
It is submitted that by forcing the customers to accept these unreasonable conditions as part of its licensing regime, the Plaintiffs have committed precisely the kind of overreaching in copyright licensing that the copyright misuse doctrine aims to prevent and have accordingly committed an abuse of legal process. The Plaintiffs are accordingly barred by their own misuse from enforcing any of its copyrights by means of any claim for infringement. It is submitted that the present averment is without any prejudice to the claim of the Defendants that no infringement has taken place or as alleged by the Plaintiff herein.
on 14th March, 2014 inter alia the following order was passed:-
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It has been enquired from the counsel for the defendants that the law of copyright, having been codified in the Copyright Act, 1957, whether there is any provision therein, which permits such a defense to be raised and whether in the statutes of the countries where such a defense is held to be permitted, there is any statutory support therefor.
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The counsel for the defendants states that though there is no provision, neither in the Indian Statute nor in any of the foreign statutes, but the said defense, being an equitable defense, has been entertained. He has further contended that we are only at the stage of framing of issues and since the plea has been raised in the written statement and to which no replication has been filed, the issue necessarily has to be framed.
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I am not in agreement. This Court is not to frame issues, merely because a plea is taken in the pleadings. Issues are to be framed, only on pleas material for adjudication of the controversy in the litigation. Needless to state that framing of an issue on a plea which is otherwise not relevant for adjudication of the controversy, delays trial inasmuch as evidence will have to be led on such pleas. I have recently in Kawal Sachdeva Vs. Madhu Bala Rana had an occasion to deal in detail on this aspect and need is thus not felt to elaborate further.
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The counsel for the defendants in response states that the plaintiffs will not suffer by such delay, since there is already an interim injunction in favour of the plaintiffs and the...
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