Regulating Intellectual Property Rights on the Internet
By
Aashit Shah
(This article was published in the Government Law College Law Review 1999-2000)
INTRODUCTION
The Internet is a vast, fluid and boundless universe. Even though it is at an incipient stage, the net is becoming one of the most-favoured and convenient places to do business. Business activities over the net, popularly termed as "E-Commerce", are growing by leaps and bounds. Just half a century ago, nobody would have probably imagined something like the Internet and today it occupies a vital part of the world’s economy. Looking at the manner in which activities over the Internet are flourishing, it soon will be the axis on which the global economy will rotate.
Forecasters predict a massive increase in earnings that are generated by way of e-commerce. Some projections indicate that through the Internet the monetary volume of all transactions over the net may reach $300 billion by 2001!
The significant capacity of e-commerce to change social and economic lives was aptly summed up by the Canadian Ministry of Revenue’s Advisory Committee on Electronic Commerce which stated that electronic commerce "represents the most radical force of change that nations have encountered since the Industrial Revolution."
THE PROBLEM
Starting from commercial enterprises to professionals, all of them have started utilising the Internet to increase their avenues and incomes. With the increase in business transactions over the Internet, it has become incumbent to have laws that will discipline these transactions and activities. It is at this stage that the question of regulating the Internet becomes important. Laws regarding customs and taxes, privacy, content and liabilities, governing of contracts and protection of intellectual property rights are necessary to govern e-commerce activities.
The difficulty in formulating laws for the Internet arises primarily in the field of territorial jurisdiction. It is a well-recognised concept that laws on any particular topic govern the range of activities concerning that topic within the geographical limitations of a particular region. The Internet is a world without any boundaries or demarcations. Activities over the net cannot be compartmentalised according to the country in which they take place. Therefore it would be troublesome to decide as to where the crime has taken place and which jurisdiction’s laws should be made applicable.
Moreover, it would be impracticable to form an international law governing the Internet. It would be virtually impossible for the world community to arrive at a consensus on regulations governing Internet. The activities over the net are at such a nascent stage, that it is not possible to have a concrete set of rules to control them. Even if an international law is formed, several countries will not have the capacity to enforce the newly formed law and that would result in an ineffective implementation. The first step taken in this direction was by the United Nations Commission on International Trade Law (UNCITRAL) in drafting a model law on Electronic Commerce in December 1996. This model law has become the basis for the adoption of cyber laws by individual countries.
However, due to the lack of any other concrete laws, the Internet has become a breeding ground for several crimes most of them related to intellectual property rights, namely copyrights and trademarks. Activities over the net have greatly threatened these intellectual property rights. Keeping these vandalistic operations in mind, as of now, several countries are using and modifying intellectual property laws to curb cyber-crimes and regulate activities on the net. Laws concerning copyrights and trademarks as well as common law doctrines of unfair competition and passing off are widely used to deal with net-related wrongs. In a layman’s terms " passing off" means to pass off your goods as someone else’s.
THE SOLUTION
Copyright Protection:
Copyright is an intellectual property right that subsists in literary and artistic creations. However, the protection of this right is endangered over the Internet. Illegal and unauthorised distribution of copyrighted works is the greatest grievance of copyright owners. A copyright owner may place his work on the World Wide Web with the intention of sharing his creations with the public. However that does not mean that people will not misuse his work or exploit his creations for personal economic gains. Furthermore, though copyright protection technologies such as encryption and digital watermarking are likely to prevent much of the infringement, they will not be able to preclude the "scanning" of hard copy images onto the Internet.
Moreover, it would be difficult and unreasonable for the Internet Service Providers (ISPs) and Online Service Providers (OSPs) to monitor all the numerous transactions and activities over the net. However, in several cases, when the ISPs and OSPs, have encouraged or aided in infringing activities, they have been held guilty of vicarious or contributory infringement. One of the first cases in the United States that dealt with the liability of an OSP was Playboy Enterprises v. Frena (1993). In that case the court decided that the service provider Frena was directly liable for copyright infringements of material belonging to Playboy Enterprises. But courts are moving away from imposing direct liability on service providers. They now scrutinise the conduct of these service providers through the theories of contributory and vicarious liability. These changes can be observed in the rulings of US Courts in several cases such as Religious Technology Center v. Netcom On-Line (1995), Sega Enterprises Ltd. v. Maphia (1996) and Sega Enterprises Ltd. v. Sabella (1996).
Furthermore, as indicated by the US Court in the case of MAI Systems Corp v. Peak Computer Inc (1993), the using of hypertext to link websites without prior permission or consent may also amount to copyright infringement. The Court of Session passed a judgement on similar lines in the Scottish case of Shetland Times v. Dr. Jonathan Wills and Zetnews Ltd. (1997).
As the communication media over the Internet is vastly different from the normal methods to which copyright law is applied, several nations have amended their copyright laws in order that they may be applied to activities on the Internet.
Protection of Trade Marks and Domain Names / Passing Off Actions:
Trademarks are those intellectual property rights that protect a trader’s goodwill and reputation and differentiate his goods from those of another trader in the same stream or business. In simple words, it is a mark whereby the public at large identifies a trader’s goods. For example, when a person sees the symbol "CK", he immediately thinks of Calvin Klein. Thus "CK " is the trademark for all Calvin Klein products. It would be very difficult to prevent two people from different parts of the world from using same or similar trademarks on the Internet. It is due to this reason that trademark infringements are becoming rampant on the net.
The primary issue concerning trademarks over the Internet is that of domain names. In Cardservice International Inc. v. Mc Gee (1997), the US District Court held that domain names serve the function of a trademark. A domain name is the name which forms part of your web site’s address and is used to locate the home page. A Company or institution that uses a particular trademark is likely to use that trademark as a part of its domain name. For example Compaq is the trademark used by a well - established multinational corporation that deals in computers. Therefore they have used this name in their website address which is www.compaq.com. Many a time, another organisation may, with a view of taking advantage of a well-known trademark, use that trademark for its own web site. This kind of activity amounts to trademark infringement and has come to be commonly known as "cybersquatting." Cybersquatting has been recognised as an infringing activity in several countries such as USA, UK, Canada, France and Italy. In fact in Italy, where the legal debate about trademarks and domain names is still developing, courts, in some cases like Amadeus Marketing SA and Amadeus Marketing Italia S.r.l v. Logica S.r.l (1997) and M. Cirino Pomicino S.p.A. v. Geredil S.a.s. et al. (1999), have held that cybersquatting activities may also amount to unfair competition when there is an element of confusion.
Courts of the United Kingdom in various cases such as Glaxo Plc v. Glaxwellcome Ltd. (1996) and Marks & Spencer and Others v. One in a Milion (1998) have also qualified such practices as those under the tort doctrine of passing off. In a recent case, the Court of Appeal (UK) laid down that in a successful action of passing off, the Claimant must establish the following ingredients:
Therefore according to this explanation, cybersquatting activities may come under the purview of passing off. In such cases the remedies which the aggrieved party has may either take the form of damages or compensation, injunctions (interlocutory or permanent) or both.
Domain name registration organisations such as Nominet (UK) and Internic (USA) have become vigilant in this department and are exercising utmost care to ensure that legitimate trademark users are protected against any infringing operations.
THE INDIAN SCENARIO
In India, as of now, several organisations are still undergoing the metamorphosis from the traditional manner of conducting their business to the electronic mode of increasing their turnovers. E-commerce is not all that popular in India as in several parts of Europe, USA and other advanced countries. However, it has grown tremendously over the past five years despite several hindrances.
Indian Courts have also dealt with a few cases regarding intellectual property rights on the Internet. In Yahoo Inc. v. Akash Arora (1999), the courts held that the provisions of the Indian Trademark Act could be used for domain names on the Internet. Furthermore, in the case of Rediff Communication Limited v. Cyberbooth and Ramesh Nahata of Mumbai (1999), the Bombay High Court supported an action of passing of when the Defendants used the term ‘RADIFF’ (similar to the name ‘REDIFF’ of the Plaintiff) to carry on business on the Internet.
India has also been active in drafting laws for the net. There are already two drafts on the subject waiting to be adopted by the Law Ministry namely the Department of Electronics’ Information Technology Bill 1998 and the Commerce Ministry’s E-Commerce Act, 1998. Hopefully, with a stable government, they may be passed soon.
CONCLUSION
Some countries such as USA, Canada, UK, Japan, Singapore and Malaysia have already started legislating for the Internet. Many countries have even changed their intellectual property laws in such a way that they may be used for infringing activities on the net. However this is only a temporary key to the problem. Though the World Intellectual Property Organisation (WIPO) organised a diplomatic conference on digital issues in December 1996, the three draft treaties formed at this conference have not yet been ratified by the signatories.
A concrete set of laws to govern intellectual property rights on the Internet is one of the top-most items on the agenda of international concerns for the next millenium.
Being aware of the mounting infringing activities, as of now, the only adequate solution would be to target your web sites to a particular region with whose laws you are familiar and where you feel your rights will be protected without injuring anybody else’s rights. It is always advisable to have all the material on your web site to be licensed and registered. Moreover, linking your web site to another and vica versa must be done only after proper authorisation is obtained. Trademarks and domain names must also be registered according to the established procedures. Certain precautionary measures like these may, if not completely stop, at least reduce crimes and protect your intellectual property rights over the Internet.
* The articles or opinions expressed in the articles must not be construed as any legal advice.