Kirti BalasubramanianCounsel
Disha JhaSenior Associate
Bhavik ShuklaAssociate
Key Developments
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Nice Classification introduces specific descriptions for virtual goods and services (Non-Fungible Tokens and Crypto-assets)
There has been a lack of clarity with regard to the categorisation of marks applied to industries concerned with virtual goods and services (such as those dealing with non-fungible tokens (NFTs) and crypto-assets) as well as permissible descriptions. As a result, companies offering such goods and services are unable to secure trademark registrations for their marks. The misclassification of these marks and inadequate goods/service descriptions weakens the portfolio of trademark holders, eventually eroding brand value.
In a relief to such new industries, the 12th edition of the Nice Classification (introduced by the World Intellectual Property Organisation (WIPO) through an information notice dated 14 October 2022), includes specific descriptions for virtual goods and services. These descriptions bring much needed clarity on the classification of these virtual goods and services and are likely to aid in the protection and enforcement of trademarks in these classes.
The Nice Classification applies from 1 January 2023 to all trademark applications received by domestic trademark offices that have adopted the Nice Classification (including India) or the International Bureau of the WIPO. The Office of the Controller General for Patents, Designs and Trade Marks in India has already implemented these changes.
Some of the key changes introduced in the 12th edition are as follows:
- A new entry in Class 9 (i.e., 'downloadable digital files authenticated by non-fungible tokens') which is especially useful for categorising works of art, music, etc., minted by users on NFT platforms has been introduced.
- The entry 'downloadable computer software for managing cryptocurrency transactions using blockchain technology' in Class 9 has been amended to broaden the scope to ‘crypto-assets’ as opposed to only fungible currency i.e., 'downloadable computer software for managing crypto asset transactions using blockchain technology'. Additionally, the entry 'cryptocurrency mining/crypto mining' has been changed to 'mining of crypto assets/crypto mining' in Class 42 to broaden the scope to include ‘crypto-assets’.
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Delhi High Court holds that courts have wide powers to order discovery
Recently, the Delhi High Court has, in several cases before it, taken a strict approach to intermediary liability, holding them accountable for failing to curb infringing content on their platforms.
In its recent decisions in Neetu Singh v Telegram FZ LLC and Living Media India Limited v Telegram FZ LLC, the Court ordered the instant messaging app, Telegram FZ LLC, to disclose names, phone numbers and IP addresses of channels used to share infringing materials. The Court, in these cases, disregarded Telegram’s arguments that no grounds had been made to justify such discovery, especially given that its servers were based and operated outside India. The Court held that Indian courts have wide jurisdiction to demand disclosure of details that are material and pertinent to a suit (as per the Code of Civil Procedure, 1908) and that it was irrelevant that Telegram’s servers were based outside India, as it was targeting Indian users, and making its services available in India.
It remains to be seen if the numerous cases on this issue impact government policy on the scope of intermediary liability and reflect in the upcoming Digital India Bill.
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Delhi High Court departs from a strict assessment of deceptive similarity in respect of pharmaceutical products
On examining past jurisprudence, we have seen that courts have typically examined rival marks for pharmaceutical products as a whole (and not on the basis of their individual components – such as suffix, prefix, etc.), and rival mark having minor dissimilarities (such as of only one or two characters) were held to be similar.
The Delhi High Court, in the recent case of Sun Pharma Laboratories Limited v Intas Pharmaceuticals Limited, acknowledged this precedent but in a slight departure, after reviewing each facet of the products (packaging, pronunciation of the marks, font and style) cumulatively, found that the rival products were dissimilar, and not likely to cause confusion among consumers. The Court refused to injunct Intas’ pharmaceutical product under the mark ‘SITARA-D’, in view of the plaintiff’s mark ‘SITARED’ for the identical product. The Court observed that not only were the rival marks phonetically and visually distinct, even the corresponding packaging of the respective products were dissimilar. The Court also found that the use of the common prefix ‘SITA’, and the suffix ‘-D’ was justified on account of the use of the ingredients, i.e., ‘Sitagliptin’ and ‘Dapagliflozin’ respectively, in the defendants’ product formulation.
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Delhi High Court clarifies the standard of the ‘instructed eye’ in assessing design piracy
The Delhi High Court, in the design piracy case of Diageo Brands B.V. v Alcobrew Distilleries India Private Limited, clarified that the test for determining design piracy is to establish similarity in rival designs (i.e., rising to the level of a ‘fraudulent and obvious imitation’) from the perspective of an ‘instructed eye’ and not that of an ‘average customer’.
The Court observed that the user for the purposes of design piracy is not a ‘person skilled in the art’ but at the same time is not an ‘average consumer’, i.e., a person with average intelligence and imperfect recollection. The Court stated that such user is instructed by (i) experience of other similar articles (or prior art); (ii) is reasonably discriminatory; and (iii) is able to appreciate detail.
The Court also held that the standard of an instructed eye would apply in respect of both design piracy assessments as well as comparisons with prior art for establishing validity of a design, as these cannot be separated. This test for design piracy may shape both jurisprudence by courts as well as the examination of applied designs by the Design Office.
In the coming months, infringement of intellectual property on digital platforms (especially Web3 platforms) and web domains is likely to remain in focus. Separately, given an increasing number of patent/trademark prosecution related appeals before various High Courts, and the orders of these courts holding the Indian Intellectual Property offices accountable for their decision-making processes and substantive orders, we also expect to see a rise in quality of intellectual property rights granted in India.
