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Guidelines For Implementation of Section 209 IPC In IPR Matters

Section 209 of IPC has remained unchartered territory in matters pertaining to Intellectual Property Rights, especially pertaining to Trade Marks/Copyright. In matters pertaining to trade marks, copyrights, there is general tendency of parties to make tall claim of user of trademarks/copyright.

Whenever a suit is filed or written statement is filed, the contesting parties are making tall claim of user, but in most of the matters, the party seldom files the documents substantiating the claimed user. Or in many cases, the party takes the contradictory claim of user with respect to the user, they have claimed in trade mark application. In such circumstances, Section 209 IPC can be invoked by the Hon’ble Court so that party should restrain themselves from making false claim.

Section 209 IPC states as hereunder:-
Section 209 – dishonestly making false claim in Court.

“Whoever fraudulently or dishonestly or with intent to injure or any person makes in a court of justice any claim which knows to be false, shall be published with imprisonment of either description or a term which may be extend to two years, and also shall be liable to fine.”

It is submitted that the Hon’ble Court may take recourse of Section 165 of the Indian Evidence Act 1972 to carve out the truthfulness of the statement made by the parties.

Section 165 of Indian Evidence Act states as hereunder:-

Section 165 in The Indian Evidence Act, 1872

165. Judge's power to put questions or order production.-

The Judge may, in order to discover or to obtain proper proof of relevant facts, ask any question he pleases, in any form, at any time, of any witness, or of the parties, about any fact relevant or irrelevant; and may order the production of any document or thing; and neither the parties nor their agents shall be entitled to make any objection to any such question or order, nor, without the leave of the Court, to cross-examine any witness upon any answer given in reply to any such question: Provided that the Judgment must be based upon facts declared by this Act to be relevant, and duly proved: Provided also that this section shall not authorize any Judge to compel any witness to answer any question, or to produce any document which such witness would be entitled to refuse to answer or produce under sections 121 to 131, both inclusive, if the questions were asked or the documents were called for by the adverse party; nor shall the Judge ask any question which it would be improper for any other person to ask under section 148 or 149; nor shall he dispense with primary evidence of any document, except in the cases hereinbefore excepted.

Normally in matters pertaining to IPR (Viz: trademark/design), when ever a party is making false claim of user, that is penalizing by grating or vacating the Injunction. But what should be criminal liability of party making such a false statement, has not been dealt with by the Court.

Recently vide order dated 20.04.2015 passed in FAO 114/2015, passed by Hon'ble Mr. Justice J.R. Midha, notice under Section 209 IPC has been issued to the Appellant for making false claim. The relevant portion of the said order is being reproduced as herein below:

“The appellant has challenged the impugned order dated 20th February, 2015 whereby he has been restrained from using the registered trademark ‘POLO’ and the device of a rider playing polo. The appellant adopted the respondent’s trademark ‘POLO’ as well as respondent’s device in the year 2007. This Court is of the prima facie view that the appellant has made a false claim which amounts to an offence under Section 209 of the Indian Penal Code.”

It is submitted that the said notice was issued as the Hon’ble Court was of the view that the user claimed by the appellant in the matter was wrong. However vide order dated 03.11.2016 passed in the said Appeal, the said matter was not tested by the Hon’ble Court, as the matter was remanded back and notice under Section 209 IPC was withdrawn. The relevant portion of Order dated 03.11.2016 passed in the said Appeal is being reproduced as herein below:

Since the matter is being remanded back, the show cause notice dated 20th April, 2015 under Section 209 IPC is withdrawn. However, the Trial Court shall consider Section 209 IPC at the time of final hearing of the suit after recording of the evidence.
The criminal liability of a party, making a false claim of user , is yet to be tested in purview of Section 209 IPC. I am proposing general guidelines for invoking the provision of Section 209 IPC.

The provision of Section 209 IPC is penal in nature and the court should exercise precaution in applying the same in matters pertaining to Intellectual Property Rights, especially in relation to matters pertaining to trade mark. Section 209 IPC can be held to be applicable where it appears to the court that the party, other than owner of the trade mark, has wrongly and dishonestly adopted the trade mark.
 
Though it is very difficult to make out the circumstances where it can be held that the provisions of Section 209 IPC can be held to be applicable. However here are few of the examples where a party can be held to be punishable for the offences committed under Section 209 IPC.

In case of counterfeiting (meaning thereby use of identical trade mark by any other party, other than the original owner/proprietor, in relation to duplicate/pirate/counterfeit product), the offence under Section 209 IPC is made out as in such cases the counterfeiters are fraudulently or dishonestly make false claim in the court as to their ownership in relation to counterfeit products, whereby the interest of owner of the trade mark is adversely effected.

Where the trade mark of a party is an arbitrary or coined or a well known trade mark, in such circumstances adoption of similar trade mark by another party can be held to be ex-facie illegal or dishonest. For example the trade mark like Swiss Military, Benz, Loreal, Gariner, Lacosate, Polo Ralph Loren, Lakme, etc., where the owner has coined the trade mark, if any other party is claiming to be proprietor of same or similar trade mark, the dishonesty committed on the part of other party is ex-facie apparent and offence under Section 209 IPC is made out.

In case of ex-employee, ex-licensee, ex-director, ex- partner, ex-distributor, ex-agent etc., the knowledge on their part of the original owner of the trade mark can safely and easily fastened. The ex-employee, ex-licensee, ex-director, ex- partner, ex-distributor, ex-agent etc cannot claim to be owner or proprietor of same/similar trade mark of the original company/partnership firm/proprietorship firm. In case they are doing so, they are making themselves liable to be punished in accordance with Section 209 IPC.

In some cases, the owner of a trade mark use the trade mark in a artistic manner and also uses unique symbol. For example trademark Hamdard With Unique Eye Design, trade mark Polo With Device Of Polo Player, trademark Lacoste With Device Of Crocodile etc. In such cases if third party uses either unique lettering style, artistic feature or the logo then the third party can easily be imputed with the knowledge of the original trade mark. In such cases also the court should initiate proceeding under Section 209 IPC.

The provision of Section 209 IPC is applicable also in cases where a party dishonestly makes a claim which he knows to be false. These can be explain with examples like if a party has filed trade mark application with claiming a user since a particular date and year. If in the suit proceedings, the party claims a different date of user of the same trade mark in relation to identical goods, in such case it is clear that before the Hon’ble court he makes a claim which he knows himself to be false.

It also applies to cases where a party takes a contradictory stand, to what he has taken in any other proceeding prior to the suit proceeding. The contradictory stand may be of any kind , like the knowledge of the trade mark, the user of trade mark etc.

In a party is wrongly using a symbol ® or “TM” in spite of the fact either the trademark is not registered or the trademark is not pending or have been abandoned. By claiming the trademark to be registered, though it is not registered, or by making claim of trademark application, despite being the same abandoned, the party makes a false claim before the Court. The party can again be ex-facie held to be guilty of dishonesty in order to attract the provisions of Section 209 IPC.

If a party is using false trade description on the impugned product then also the provisions of Section 209 IPC can be said to have been attracted.

There can be various examples of this kind. If a party is using a mark, symbol or word or logo on their product to show that it is originating from a particular country despite of this fact that the product is not originating from that country, then also it can be said that the person is making false claim to attract the provisions of Section 209 IPC. For example if a party is using the trademark SWISS LIGHT with flag of Switzerland , without the product emanating from Switzerland , or without being authorized to use the flag of Switzerland, then the party is apparently liable to be punished under the provision of Section 209 IPC.

Where the parties are located in same city, state or in close proximity with each other and are using identical/similar trademark in relation to same/similar products then also knowledge on the part of subsequent adopter of trademark regarding the prior adopted and prior used trademark can easily be imputed. In similar fashion if the advertisement of both the parties is found in same Newspaper or Magazine then also knowledge on the part of subsequent adopter can safely be imputed. In a nutshell if it can ex-facie be seen that the other party is having knowledge of the earlier trademark and in spite of knowledge the same keeps on using the same/similar trademark.

All these guidelines are also applicable to third parties who are the subsequent adopter of trademark mark and are subsequently using the trademark as a part of domain name/e- mail ids/trade name etc. Even if third party uses the well known or arbitrary trademark as part of the software application, service mark etc.

The provisions of Section 209 IPC can also be liable to liable where the intermediaries are not the following the guidelines as warranted under the provisions of Section 79 of the Information Technologies Act and the guidelines issued in the year 2013 in relation thereto.

Third party can evade the liability under Section 209 IPC if the same can prove that he is not aware of the trademark of the original owner of a trademark. For example if a party is based in Kashmir and another party is based in Chennai.

Though the party based in Kashmir may be prior user of a trade mark but if party based in Chennai adopts the similar trademark but if the lettering style and symbol used with trademark are different then provisions of Section 209 may not be attracted. If the parties are located at distant places and are dealing in different products then also it is not a fit case to apply the provisions of Section 209 IPC. Provisions of Section 209 IPC may also not be attracted where the subsequent user of a trademark proves his bonafide by producing the search report from the trademark registry in order to establish that the same has inquired from trademark registry to ascertain whether similar trademark exists in the name of some other party.

Written by: Ajay Amitabh Suman, Advocate, Delhi High Court

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