Key Features of the Litigation And Dispute Resolution
Need for Alternative Mode of Dispute Resolution in Intellectual Property Disputes
While evaluating the performance shown by the Indian judiciary in cases related to intellectual property rights, the Supreme Court of India has in the case of ShreeVardhman Rice & Gen Mills v. Amar Singh Chawalwala[1] held that “…Without going into the merits of the controversy, we are of the opinion that the matters relating to trademarks, copyrights and patents should be finally decided expeditiously by the Trial Court instead of merely granting or refusing to grant injunction.
In the matters of trademarks, copyrights and patents, litigation is mainly fought between the parties about the temporary injunction and that goes on for years and years and the result is that the suit is hardly decided finally. This is not proper…In our opinion, in matters relating to trademarks, copyright and patents, the proviso to Order XVII Rule 1(2) C.P.C. should be strictly complied with by all the Courts, and the hearing of the suit in such matters should proceed on a day to day basis and the final judgment should be given normally within four months from the date of the filing of the suit.”
Reiterating its stance in Bajaj Auto Ltd. v. TVS Motor Company Ltd[2]., the Supreme Court of India held that “experience has shown that in our country, suits relating to the matters of patents, trademarks and copyrights are pending for many years and litigation is mainly fought between the parties over temporary injunction. This is a very unsatisfactory state of affairs, and hence, we had passed the above quoted order in the above-mentioned case to serve the ends of justice. We direct that the directions in the aforesaid order be carried out by all courts and tribunals in this country punctually and faithfully.”
It is evident that due to unwarranted delay in the disposal of cases and the costly litigation which could prolong the protection accorded to the work, rather than promoting the progress of intellectually protected work, the aggrieved parties are opting for alternate dispute resolution mechanisms for the advancement of intellectual property rights in India. Moreover, the commercial nature of the transactions involved in majority of intellectual property based litigations, solicits such an approach.
Alternate Dispute Resolution Machinery
Alternate dispute resolution embodies within its garb different modes of resolving a dispute, other than that provided by the traditional model of litigation. Arbitration, mediation, settlement and conciliation are some of the models which are the alternatives to court based litigation. The Arbitration and Conciliation Act, 1996 has been the main statute in India dealing with the two cited alternate forms of dispute resolution.
The Civil Procedure Code, 1908 also provides for the adoption of different models for the expeditious determination of disputes. The merits of the modes of alternate dispute resolution are not only limited to speedy remedy, but also, to the flexibility, cost effectiveness, confidentiality and business oriented results.
The Indian judiciary has effectively tried to bring mediation and settlement for intellectual property disputes in the traditional model of litigation, through the reading of Section 89 of the Civil Procedure Code, 1908. Even where the alternative dispute resolution methods fails to be the effective choice for the determination of disputes related to intellectual property rights, they can be used for narrowing down the issues for contestability in a traditional model of litigation.
In this context, it is relevant to refer to the law laid down by the Supreme Court in the case of Booz-Allen & Hamilton Inc v. SBI Home Finance Ltd. & Ors[3]. After discussing the law extensively, the Court laid down the test to determine the arbitrability of disputes and held that all disputes relating to rights in personam are considered to be amenable to arbitration while rights in rem are required to be adjudicated by Courts and public tribunals.
Alternative Dispute Resoution Measures for Intellectual Property: Need of the Hour
The solution lies in the introduction of alternative dispute resolution mechanisms, for the redressal of grievances related to infringement of protected rights of an intellectual property holder. Alternative dispute resolution mechanisms are less time consuming, efficient and provide flexibility to the right holder. It is important to note that in all the commercial transactions, the route of alternate dispute resolution has already shown its majority over the traditional modes of litigation. Nowadays, contracts related to transfer of intellectual property mostly include the “arbitration-mediation” clause. This highlights the weight of arbitration in commercial intellectual property transactions.
In a landmark judgment in the case of Bawa Masala Co. v. Bawa Masala Co. Pvt. Ltd. and Anr.[5], where a number of legal disputes were already resolved through a process of alternate dispute resolution, the Delhi High Court passed orders for adoption of a process known as early neutral evaluation, in an intellectual property based litigation suit. The Court in this case, under the umbrella of section 89 of the Civil Procedure Code, 1908 mooted for the inclusion of such procedures for amicable settlement of disputes.
The Court further said that the early neutral evaluation procedure shares the “same features as a mediation process…the difference is that in case of mediation the solutions normally emerge from the parties and the mediator makes an endeavour to find the most acceptable solution” whereas “in case of early neutral evaluation, the evaluator acts as a neutral person to assess the strengths and weaknesses of each of the parties.” The Court further made a distinction between early neutral evaluation and arbitration by stating that in early neutral evaluation “there is no testimony or oath or examination and such neutral evaluation is not recorded.”
The Court also held that early neutral evaluation is “confidential and cannot be used by any of the parties against the other. There is no award or result filed.” This stands as a seminal case, where, Indian Courts have tried to bring alternative dispute resolution machinery for solving intellectual property infringement related matters. This case also highlights the inclination, which Indian Courts have started sharing, towards involvement of alternate dispute resolution measures in resolving of such disputes.
