MODULE 1

1. Intellectual Property Rights System and its importance in Trade

1.1 Concept, Meaning & Nature of Intellectual Property
1.2 Historical Development of Intellectual Property Systems.
1.3 Scope of Intellectual Property: Patents, Trademarks, Copyrights, Designs,
Geographical
Indication, Traditional knowledge, New Plant Varieties, Trade Secrets and
Confidential
Information
1.4 Importance and advantages of Intellectual Property in Trade
1.5 Essentials of Patent, Trade mark, Copyright, Design, Geographical Indication and
New
Plant Varieties
1.6 International trade and Intellectual Property Rights

Meaning of Intellectual Property

 Intellectual Property can be defined as inventions of the mind, innovations, literary
and artistic work, symbols, names and images used in commerce.
 The objective of intellectual property protection is to encourage the creativity of the
human mind for the benefit of all and to ensure that the benefits arising from
exploiting a creation benefit the creator. This will encourage creative activity and give
investors a reasonable return on their investment in research and development.

Meaning of Intellectual Property Rights

 The intellectual property right is a kind of legal right that protects a person’s artistic
works, literary works, inventions or discoveries or a symbol or design for a specific
period of time.
 Intellectual property owners are given certain rights by which they can enjoy their
Property without any disturbances and prevent others from using them, although these
rights are also called monopoly rights of exploitation, they are limited in geographical
range, time and scope.
 As a result, intellectual property rights can have a direct and substantial impact on
industry and business, as the owners of IPRs one can enforce such rights and can stop
the manufacture, use, or sale of a product to the public.
 IP protection encourages publication, distribution, and disclosure of the creation to the
public, rather than keeping it a secret and to encourage commercial enterprises to
select creative works for exploitation.

Nature of Intellectual Property

 Intangible Rights over Tangible Property: IP is different from other property because
it deals with intangible things like ideas and inventions. It protects these intangible
assets and allows creators to benefit when their works are used commercially.
 Right to sue: IP is a legal asset that can be owned, bought, sold, and inherited. It
grants the owner the right to control and use their IP as they wish, with the ability to
take legal action against unauthorized use and receive compensation.
 Rights and Duties: IP grants both rights and responsibilities. The owner has exclusive
rights to produce, copy, and market their work, while also having the right to prevent
others from exercising similar rights.
  Coexistence of different rights: Different types of IP rights can coexist for a
particular function. For example, an invention can be patented while its photograph
can be copyrighted. Similarities and differences exist between these rights. Some IP
rights are positive rights, while others are negative rights.
 Exhaustion of rights: The doctrine of exhaustion in intellectual property means that
once a rights holder sells a product to which IP rights are attached, they cannot
prevent further resale of that product. The right to restrict further movements expires
with the first sale, based on the concept of free movement of goods. The exclusive
right to sell goods cannot be exercised twice for the same goods..
 Dynamism: IPR is constantly evolving due to rapid technological advancements. New
items are being added to the scope of IPR to accommodate scientific and
technological progress. Examples of these developments include bio patents, software
copyrights, and plant diversity protection. The significance and mobility of
intellectual property are well recognized and acknowledged at all levels, including
statutory, administrative, and judicial.

Historical Development
After India became independent in 1947, the government took steps to support and protect
the rights of Indian innovators and creators. They created laws to register and safeguard
patents, making it easier and more affordable for Indian inventors and entrepreneurs.
In the 1960s and 1970s, the Indian government aimed to reduce reliance on foreign
technology and money. They encouraged the development of Indian technologies, established
research institutions, and allowed the compulsory licensing of patents in certain cases that
were important for the country.
In the 1980s and 1990s, India started to open up its economy and connect with the global
market. This led to a greater focus on protecting intellectual property rights to attract foreign
investment and technology. In 1994, India joined the World Trade Organization and agreed
to follow international standards for intellectual property rights through the Trade-Related
Aspects of Intellectual Property (TRIPS) agreement.
Since then, India has made changes to its intellectual property laws to comply with TRIPS
and other international agreements. They have aimed to balance the interests of Indian
inventors and consumers with those of foreign companies. Important reforms have included
introducing product patents for pharmaceuticals in 2005, amending the Copyright Act in
2012, and adopting a National Intellectual Property Rights (IPR) Policy in 2016 to encourage
innovation, entrepreneurship, and access to knowledge.

Scope
The scope of intellectual property rights encompasses a range of legal protections for various
types of creations and innovations. These rights include:
 Copyright: Copyright protects original works of authorship, such as books, music,
films, and artwork. It grants exclusive rights to the creators to reproduce, distribute,
display, and perform their works.
 Patents: Patents are granted for new inventions or technological advancements. They
provide exclusive rights to inventors to manufacture, use, and sell their inventions for
a specific period, typically 20 years.
 Trademarks: Trademarks protect brand names, logos, and symbols that distinguish
goods or services from others. They prevent unauthorized use of these marks and help
consumers identify products from specific sources.
  Industrial Design: Industrial design rights safeguard the unique visual appearance of
a product, including its shape, pattern, or ornamentation. This protection is focused on
the aesthetic aspects of the design.
 Trade Secrets: Trade secrets are confidential and valuable business information, such
as formulas, processes, or customer lists, which give a competitive advantage. Trade
secret protection ensures that this information remains confidential and not disclosed
to competitors.
 Geographic Indications: Geographic indications identify products originating from
specific geographical locations known for their unique qualities or characteristics.
Examples include Champagne (a region in France) and Darjeeling tea (from
Darjeeling, India).

These intellectual property rights aim to incentivize innovation, creativity, and economic
growth by granting exclusive rights to creators and inventors. They provide legal mechanisms
to protect and enforce these rights, fostering a fair and competitive marketplace while
encouraging the development of new ideas and expressions.

Importance of Intellectual Property in Trade

Intellectual property (IP) plays a crucial role in international trade and commerce. It refers to
the legal rights that protect intangible assets, such as inventions, designs, trademarks,
copyrights, and trade secrets. Here are some key reasons why intellectual property is
important in trade and the advantages it offers:
 Encourages Innovation: Intellectual property rights provide an incentive for
individuals and organizations to invest in research, development, and creativity. By
granting exclusive rights to creators and inventors, IP protection stimulates innovation
and promotes the advancement of technology, science, and the arts.
 Economic Growth and Competitiveness: Intellectual property contributes to
economic growth by fostering entrepreneurship and encouraging the
commercialization of ideas. It enables businesses to differentiate their products and
services from competitors, creating a competitive advantage. Strong IP protection
attracts investment and encourages foreign direct investment, fostering economic
development and job creation.
 Protection of Investments: Intellectual property rights safeguard the investments
made by individuals and businesses in the development of new technologies,
products, and brands. By granting exclusive rights, IP protection ensures that creators
can reap the benefits of their investment and efforts, providing an incentive for further
research and development.
 Branding and Reputation: Trademarks and brand recognition are vital assets for
businesses. Intellectual property protection allows companies to establish and protect
their brands, creating a reputation for quality and reliability. This reputation can lead
to increased customer loyalty, market share, and higher revenues.
 Market Expansion and International Trade: Intellectual property rights facilitate
international trade by providing a framework for the exchange of goods and services.
Strong IP protection helps create a level playing field and fosters trust between
trading partners. It enables businesses to license their IP, enter into partnerships, and
expand their market presence globally.
Overall, intellectual property is essential for trade as it promotes innovation, protects
investments, fosters economic growth, facilitates market expansion, and ensures fair
competition. It incentivizes creativity and enables businesses to capitalize on their ideas and
assets, leading to a vibrant and thriving global economy.

Essentials

Patent
The following criteria determine what can be patented in India:
1. Patentable subject matter: The foremost consideration is to determine whether the
invention relates to a patentable subject-matter. Sections 3 and 4 of the Patents Act
list out non-patentable subject matter. As long as the invention does not fall under any
provision of Sections 3 or 4, it means it has patentable subject matter (subject to the
satisfaction of the other criteria).
2. Novelty: Novelty or new invention is defined under Section 2(l) of the Patents Act as
The novelty requirement basically states that an invention should never have been
published in the public domain. It must be new with no same or similar prior arts.
3. Inventive step or Non-Obviousness: Inventive step is defined under Section 2(ja) of
the Patents Act. The invention must not be obvious to a person skilled in the same
field as the invention relates to. It must be inventive and not obvious to a person
skilled in the same field.
4. Capable of Industrial Application: Industrial applicability is defined under Section
2(ac) of the Patents Act. This essentially means that the invention cannot exist in
abstract. It must be capable of being applied in any industry, which means that the
invention must have practical utility in order to be patentable.

These are the statutory criterion for the patentability of an invention. Apart from this, another
important criterion for getting a patent is disclosure of an enabling patent. An enabling patent
disclosure means a patent draft specification must disclose the invention sufficiently, so as to
enable a person skilled in the same field as the invention relates to, to carry out the invention
without undue effort. If the patent specification does not disclose an enabling patent then a
patent will most definitely not be granted.

Trade Mark
In order for trademarks to be recognised and also be legally valid, they need to have certain
essential features. The trademark must be a mark that includes a heading, a brand, a device, a
label, a signature, a ticket, a word, a letter, a name or a numeral, packaging, or a combination
of colours. It could even be a combination of all or some of these attributes. Other than this
some of the essential features of trademarks are as follows
1. Distinctive: A trademark needs to be distinctive. This means that the trademark needs
to have an uncommon and appealing quality that distinguishes it from other signs.
Further, distinctiveness can also be classified into inherent distinctiveness or acquired
distinctiveness. When a trademark is distinct in itself and no one can claim its use
justifiably, it is referred to as inherent distinctiveness. Acquired distinctiveness
means that through its use the trademark has acquired its distinctiveness. Being
distinctive is one of the most vital trademark features that businesses or entrepreneurs
need to keep in mind.
2. Non-descriptive: Another one of the essential trademark features is that it must be
non-descriptive. This means that if the trademark is a word, it can be other than an
invented word whether it is newly coined or already existing or can be a geometrical
 design. The trademark must be short and can be suggestive of the quality of the
products but it must not be descriptive, elaborating on the characteristics of the goods
or services.
3. Easy To Remember: A trademark must be easy to spell as well as pronounce. This is
one of the obvious trademark features that must be considered while thinking of a
trademark for the business or product. The ease to spell and pronounce the trademark
ensures that the trademark is easy to remember and recollect. Additionally, the
trademark should not be too lengthy or complicated as that will make it difficult to
remember.

In addition to these points, there are certain trademark features that need to be avoided for the
trademark to be legally usable and accepted by the authorities. These include:
 A trademark must not be offensive or violating the law.
 A trademark must not be deceiving or cause confusion in the minds of the public
 A trademark must not contain scandalous matters.
 A trademark must not contain exclusively contain marks or indications which are
customary in the established practices of trade, such as the ISI mark.
 A trademark must not contain prohibited words whose usage is forbidden under the
Emblems Act.

Copyrights
In order to make a successful copy right claim over a creation, there are three essentials that
need to be fulfilled in this direction, which are:
 Fixation: Any idea or creation against which a copy right claim is filed must be
locked in a permanent state. This is because the law aims to be precise and definite in
its consideration of claims and any vaguely worded idea would not be recognised by
the court for awarding a successful claim as against it. For example, to claim copy
rights over a song, the song must be present in a permanent for which means it must
be either recorded in a tape or CD (virtual presence) or written, a live performance
therefore cannot be protected.
 Expression: Expression is complementary to the fixation. This essential is to establish
that mere ideas cannot be copyrighted but an idea’s “expression” can be copyrighted.
For example, the idea of a movie of a swanky British super spy agent cannot
copyrighted but James Bonds films i.e. the expression of the idea can.
 Originality: The creative work so put forth for a copyright claim must be original and
must meet a basic level of originality . A copy directly of someone else’s work can’t
be copyrighted and neither can facts ,short phrases or titles .
With all three essentials as stated above fulfilled, a claim over such an original work of
creativity can be made into a copy right providing the creator with exclusive access to his
idea.

Design
Under the Design Act, 2000 for a design to be registered and protected under the Act, the
following are essential elements that need to be fulfilled:
 Original and new design. This means that it should not have been used or published
previously in any country before the date of application of registration.
 The crux of the design is the features that are represented by shapes, patterns,
configuration, composition or ornamentation that are applied or that apply to an
article.
  The design should only be appreciated with the eyes. The method or process of
creation and application is irrelevant.
 It should not include artistic works, trademarks or property marks.
 Significant differences must exist between your design and other designs that have
already been registered. Similar designs or designs with a likeness to already existing
designs even if slightly different do not qualify to be registered.

Geographical Indication

New Plant Varieties

In order to qualify for plant variety rights, a new variety must undergo official tests to
determine whether it is distinct, uniform, and stable (DUS). For most crop species, these
independent tests take two years. The requirements are as follows:
1. Distinctness: A variety must be clearly distinguishable from any other existing variety
by one or more characteristics.
2. Uniformity: Individual plants of the same variety must be sufficiently uniform in a
range of key characteristics.
3. Stability: A plant variety is considered to be stable if it reproduces true to type from
one generation to the next.
For each new variety, these DUS tests are undertaken, and the results are considered by
independent experts to determine whether all the requirements for plant variety rights have
been met.

Importance of Intellectual Property in Trade

International Trade refers to exchange of goods and services across borders. Importance of IP
in trade:
 Promotes Innovation: Intellectual property protection encourages innovation by
providing creators and inventors with the assurance that their ideas and creations will
be protected. This fosters a conducive environment for research and development, as
individuals and businesses are incentivized to invest time, effort, and resources into
creating new and groundbreaking products and technologies.
 Rewards Creativity: Intellectual property rights enable creators and inventors to be
rewarded for their efforts. By protecting their intellectual creations, individuals and
businesses can commercialize their innovations, generate revenue, and gain a
competitive advantage in the market. This financial incentive encourages further
innovation and supports the growth of businesses and industries.
 Facilitates Market Access: Intellectual property protection plays a crucial role in
international trade by facilitating market access for businesses. Strong intellectual
property laws and enforcement mechanisms provide confidence to investors and
traders, ensuring that their intellectual assets are safeguarded when entering new
markets. This, in turn, promotes cross-border trade and foreign direct investment,
contributing to economic growth and development.
 Enhances Brand Value: Intellectual property rights, such as trademarks and
copyrights, protect brands and reputation. Building a strong brand is essential for
businesses to differentiate themselves in the market and gain consumer trust.
Intellectual property protection allows businesses to establish and maintain their brand
identity, preventing unauthorized use or imitation by competitors, and ultimately
enhancing their brand value and market position.
 Prevents Counterfeiting and Piracy: Intellectual property protection serves as a
deterrent against counterfeiting and piracy. Counterfeit and pirated goods not only
 harm legitimate businesses and their revenues but also pose risks to consumer health
and safety. Effective intellectual property enforcement measures, including border
controls and legal actions, help combat these illegal activities, safeguard consumer
interests, and maintain a fair and competitive marketplace.
 Encourages Technology Transfer: Intellectual property rights can facilitate
technology transfer between countries. Through licensing and other collaborative
arrangements, businesses can share knowledge, expertise, and technological
advancements with partners in different regions. This exchange of intellectual
property encourages technological progress, supports industrial development, and
promotes economic cooperation and partnerships between nations.
 Stimulates Economic Growth: Intellectual property-intensive industries have a
significant impact on national and global economies. These industries, including
pharmaceuticals, software development, entertainment, and manufacturing, contribute
to job creation, export earnings, and overall economic growth. By protecting
intellectual property, governments can foster an environment that attracts investment,
nurtures innovation, and drives economic prosperity.

Case Study
In a case study, a European company that sold advanced knitting machinery in China
discovered that a local competitor was selling a similar product without using the company's
European trademark. The competitor copied the dimensions, appearance, colors, brochures,
and website photos of the original product.
Additionally, the local product claimed to meet the same specifications as the original, even
though it didn't. This misled customers. Unfortunately, the company didn't have any patents
registered in China. They could only rely on copyright infringement claims for their brochure
artwork and violation of the Anti-Unfair Competition Law for false claims on the brochure.
To address the issue, the company hired a local law firm to send a warning letter to the
competitor. This led the competitor to change some of the brochure contents and
photographs. However, the company couldn't legally force them to change the appearance of
their product.
This case highlights the significance of intellectual property in trade. It demonstrates the
importance of protecting intellectual property rights to prevent unfair competition, safeguard
brand identity, and maintain trust among customers.

International Trade and Intellectual Property

The international trade of intellectual property is governed by a legal regime that protects
these intellectual creations. This regime includes important agreements and organizations:
 The Paris Convention: This agreement, established in 1883, covers patents for
industrial innovations.
 The Berne Convention: Created three years after the Paris Convention, it focuses on
copyright protection.
 The Madrid Agreement: Developed five years after the Berne Convention, it
addresses the international registration of trademarks.
 BIRPI and WIPO: BIRPI, established in 1893, evolved into WIPO, which is the
modern international body regulating intellectual property. WIPO became part of the
United Nations system in 1974.

WIPO's Focus
WIPO aims to establish high intellectual property standards and develop an effective
international IP system that encourages innovation and creativity.
TRIPS Agreement
The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) is a
comprehensive agreement between World Trade Organization member nations. It sets
minimum standards for intellectual property protection, covering copyright, trademarks,
patents, and more.

Importance of Intellectual Property in International Trade

Intellectual property rights are crucial for the competitiveness of post-industrial economies.
The TRIPS Agreement acknowledges the intersection of intellectual property and trade,
providing globally recognized rules and disciplines. Protection and enforcement of these
rights are vital for industries such as software, pharmaceuticals, and publishing. Inadequate
protection can lead to piracy, infringement, and the fraudulent marketing of counterfeit
goods. Insufficient intellectual property protection distorts world trade and undermines open
marketplaces.
In conclusion, there is a close relationship between international trade and intellectual
property, with effective protection playing a significant role in promoting innovation,
safeguarding industries, and ensuring fair trade practices.
 MODULE 2

1. International Aspects of Intellectual Property Rights

1. International Organisation concerned with IP: WIPO & WTO
2. Introduction to International treaties relating to Copyright, Patent, Design and
Trademark
3. Agreement on Trade Related Aspects of Intellectual Property (TRIPS)
1. General Provisions & Basic Principles
2. Standards concerning availability, scope & use of IPRs
3. Enforcement Provisions
4. Acquisition and Maintenance of IPRs
5. Dispute Prevention and Settlement
6. Transitional Arrangements
4. Cases: US v. India at WTO on implementation of TRIPS, Basmati Rice
Case, Turmeric Case, Diamond v. Chakraborty, Harvard Onco mouse
Case, Natco v. Bayer, Novartis v. Union of India

Discuss the important principles laid down by TRIPS Agreements. Also discuss the minimum
standards provided for protection of Patents, Trademarks, Designs, Copyright and GI.

Discuss the contribution of WTO in the development of IP.

WIPO
 The World Intellectual Property Organization (WIPO) is a global body established in
1967 to promote and protect Intellectual Property Rights (IPR).
 WIPO serves as a global forum for IP services and is a self-funded agency of the
United Nations.
 Its main objective is to encourage creative activity and ensure the protection of
intellectual property worldwide.
 WIPO is headquartered in Geneva, Switzerland, and currently led by Director-General
Francis Gurry.
 WIPO's origins can be traced back to the United International Bureaux for the
Protection of Intellectual Property (BIRPI) established in 1893.
 The mandate of WIPO is to develop a balanced and accessible international IP system
that rewards creativity, stimulates innovation, and contributes to economic
development while safeguarding the public interest.

Functions of WIPO:
 Assisting in the development of campaigns to improve global IP protection and
harmonize national legislations.
 Signing international agreements related to Intellectual Property Rights (IPR)
protection.
 Implementing administrative functions discussed by the Berne and Paris Unions.
 Providing legal and technical assistance in the field of IP.
 Conducting research, publishing results, and collecting/circulating information.
 Ensuring the work of services that facilitate international IP protection.
  Undertaking other necessary actions.

WIPO Treaties:
 WIPO Performance and Phonograms Treaty (WPPT): Deals with the rights of
performers (singers, actors, musicians) and producers of phonograms in the digital
environment.
 Budapest Treaty: Focuses on international recognition of the deposit of
microorganisms for patent procedures.
 Madrid Protocol for the International Registration of Marks: Ensures protection
of a trademark in multiple countries through international registration.
 Marrakesh Treaty to Facilitate Access to Published Works by Visually Impaired
Persons and Persons with Print Disabilities: Allows copyright exceptions to create
accessible versions of books for visually impaired individuals.
 WIPO Copyright Treaty: Addresses the protection of works and the rights of
authors in the digital environment.

WIPO and India:

 India joined WIPO in 1975 and is a signatory to several WIPO treaties.
 India's WIPO memberships include IPO Convention, Paris Convention, Berne
Convention, Patent Cooperation Treaty, Phonograms Convention, Nairobi Treaty,
Nice Agreement, and Locarno Agreement.
 India ratified the Marrakesh Treaty, becoming the first country to do so.
 India has shown significant progress in innovation, ranking 52nd in the Global
Innovation Index (2019).
 India consistently outperforms in innovation relative to its GDP per capita and ranks
second in innovation quality among middle-income economies.
 The Ministry of Commerce and Industry in India deals with WIPO and related
matters.

WTO

Introduction to International treaties relating to Copyright, Patent, Design and

Trademark
International treaties play a crucial role in establishing uniform standards and regulations for
copyright, patent, design, and trademark protection across countries. These treaties facilitate
international cooperation, promote harmonization of laws, and ensure the rights of creators
and inventors are recognized and safeguarded globally. Here is an introduction to some of the
key international treaties relating to these areas.

Berne Convention for the Protection of Literary and Artistic Works:

 The Berne Convention, adopted in 1886, deals with the protection of works and the
rights of their authors.
 It provides creators such as authors, musicians, poets, painters etc. with the means to
control how their works are used, by whom, and on what terms.
 It is based on three basic principles and contains a series of provisions determining the
minimum protection to be granted, as well as special provisions available to
developing countries that want to make use of them.
WIPO Copyright Treaty:
 The WIPO Copyright Treaty (WCT) is a special agreement under the Berne
Convention which deals with the protection of works and the rights of the authors in
the digital environment.
 In addition to the rights recognized by the Berne Convention, certain economic rights
are also grated.
 The Treaty also deals with two subject matters to be protected by copyright: (i)
computer programs, whatever the mode or form of their expression; and (ii)
compilations of data or other material ("databases").

Patent Cooperation Treaty

 The Patent Cooperation Treaty (PCT) makes it possible to seek patent protection for
an invention simultaneously in each of a large number of countries by filing an
"international" patent application.
 Such an application may be filed by anyone who is a national or resident of a PCT
Contracting State.
 It may generally be filed with the national patent office of the Contracting State of
which the applicant is a national or resident or, at the applicant's option, with the
International Bureau of WIPO in Geneva.

The Madrid Agreement Concerning the International Registration of Marks and the
Protocol Relating to the Madrid Agreement
The Madrid System for the International Registration of Marks is governed by two treaties:
 The Madrid Agreement, concluded in 1891 and revised at Brussels (1900),
Washington (1911), The Hague (1925), London (1934), Nice (1957) and
 Stockholm (1967), and amended in 1979, and The Protocol relating to that
Agreement, concluded in 1989, which aims to make the Madrid system more flexible
and more compatible with the domestic legislation of certain countries or
intergovernmental organizations that had not been able to accede to the Agreement.
 States and organizations party to the Madrid system are collectively referred to as
Contracting Parties.
 The system makes it possible to protect a mark in a large number of countries by
obtaining an international registration that has effect in each of the designated
Contracting Parties.

Trademark Law Treaty

 The aim of the Trademark Law Treaty (TLT) is to standardize and streamline national
and regional trademark registration procedures.
 This is achieved through the simplification and harmonization of certain features of
those procedures, thus making trademark applications and the administration of
trademark registrations in multiple jurisdictions less complex and more predictable.

The Patent Law Treaty

 The Patent Law Treaty (PLT) was adopted in 2000 with the aim of harmonizing and
streamlining formal procedures with respect to national and regional patent
applications and patents and making such procedures more user friendly.
 With the significant exception of filing date requirements, the PLT provides the
maximum sets of requirements the office of a Contracting Party may apply.
TRIPS
 Intellectual property rights are rights given to creators over their creations.
 They provide exclusive rights to use the creations for a specific period of time.
 Intellectual property is intangible and created by the human mind.
 Businesses can use intellectual property to gain a competitive advantage and grow.
 Like any other property, intellectual property can be assigned, licensed, or transferred
to others.
 Intellectual property rights are valued and exchanged internationally.
 The World Trade Organization's TRIPS agreement acknowledges the significance of
intellectual property in international trade.
 The TRIPS Agreement sets out the basic requirements for member governments to
protect intellectual property rights.

Objectives of TRIPS:
The Preamble to the Trips Agreement lays out the broad objectives of the agreement, which
includes:
 Elimination trade distortions and obstructions
 Encouraging effective and adequate protection of IPRs
 Ensuring that enforcement measures and procedures do not become hurdles to
legitimate commerce

Benefits of TRIPS:
 The TRIPS agreement helps to reduce trade conflicts over intellectual property issues
while allowing WTO members to pursue a variety of domestic policies
 Beyond just sending things across borders, the concept of trade and what makes trade
beneficial to civilizations have evolved

General Provisions and Basic Principles

1. Comprehensive Protection: Articles 3, 4, and 5 hold the key to the essential
principles of national and most-favored-nation treatment for foreign persons. These
principles apply to all forms of intellectual property encompassed by the Agreement.
2. Beyond Protection Standards: The obligations go above and beyond safeguarding
substantive standards of protection. They encompass a wide range of critical issues,
including availability, acquisition, scope, maintenance, and enforcement of
intellectual property rights.
3. Empowering Innovation: The Agreement also addresses the vital aspect of utilizing
intellectual property rights. It provides specific guidance on how to maximize the
potential of these rights while ensuring fairness and balance.
4. Equality in Treatment: The national treatment provision eliminates any
discrimination between a member country's own nationals and those of other member
countries. Everyone is granted equal treatment, fostering a level playing field.
5. Promoting Fairness: The 'most-favored-nation' treatment clause takes it a step
further by prohibiting discrimination between nationals of different member countries.
Fairness and equal opportunities are upheld on a global scale.
6. Building on Existing Success: The exclusions authorized under the pre-existing
WIPO intellectual property treaties find their place within the TRIPS Agreement,
reinforcing the commitment to national treatment.
 7. Government's Regulatory Power: Governments are empowered to enact legislation
that combats the abuse of intellectual property rights. They can also challenge
practices that unjustly restrict commerce or impede the international transfer of
technology, all while adhering to the Agreement's provisions.
8. Unleashing Innovation and Growth: By honoring these principles and provisions,
the Agreement stimulates innovation, encourages creativity, and fuels the exchange of
knowledge and technology on a global stage.
9. Transforming Ideas into Prosperity: TRIPS sets the stage for a thriving intellectual
property ecosystem, where creators and innovators can harness their ideas to drive
economic growth, foster collaboration, and shape a better future for all.

Standards concerning availability, scope & use of IPRs

The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) sets
standards concerning the availability, scope, and use of intellectual property rights (IPRs).
Here are some key points related to these standards under TRIPS:
Availability of IPRs:
TRIPS requires member countries to make available and protect various forms of IPRs,
including copyright, trademarks, patents, industrial designs, and trade secrets. Each member
country must provide legal means for IPR owners to enforce their rights.
Scope of IPRs:
TRIPS establishes minimum standards for the scope of protection for different types of IPRs.
It sets out specific criteria and conditions for granting and enforcing these rights. For
example:
a. Copyright: TRIPS mandates the protection of works of authorship, including literary,
artistic, and musical works, for a minimum period of 50 years after the author's death. It also
includes provisions on rights related to copyright, such as those of performers and producers
of phonograms.
b. Trademarks: TRIPS requires member countries to protect trademarks, including well-
known trademarks, and provides guidelines for determining infringement and remedies. It
also addresses issues related to the registration, assignment, licensing, and use of trademarks.
c. Patents: TRIPS sets standards for patent protection, including eligibility criteria,
patentable subject matter, and the rights conferred to patent holders. It also includes
provisions for compulsory licensing and limitations on exclusive rights.
d. Industrial Designs: TRIPS requires member countries to protect industrial designs, which
refer to the aesthetic aspects of products. It establishes minimum standards for the duration
and scope of protection.
Use of IPRs:
TRIPS allows member countries to establish limitations and exceptions to IPRs to promote
public interests and prevent abuse. These limitations and exceptions must be in accordance
with the three-step test, which ensures that they are limited to specific cases, do not conflict
with the normal exploitation of the work, and do not unreasonably prejudice the legitimate
interests of the right holder.
Enforcement:
TRIPS includes provisions on the enforcement of IPRs, such as civil and administrative
procedures, border measures, and criminal penalties for infringement. It requires member
countries to provide effective remedies and deterrent penalties to combat IPR violations.
Technology Transfer and Access to Medicines:
TRIPS includes provisions aimed at balancing the protection of IPRs with the promotion of
access to medicines and technology transfer in the context of public health. These provisions
allow flexibility for member countries to take measures to protect public health and ensure
access to affordable medicines.
Overall, TRIPS establishes a framework for the availability, scope, and use of IPRs,
promoting international standards and harmonization while allowing for some flexibility to
address specific national needs and concerns.

Patent Co-operation Treaty

 The Patent Cooperation Treaty (PCT) is an international patent law treaty, concluded
in 1970. It provides a unified procedure for filing patent applications to protect
inventions in each of its contracting states. A patent application filed under the PCT is
called an international application, or PCT application.
 A single filing of a PCT application is made with a Receiving Office (RO) in one
language. It then results in a search performed by an International Searching
Authority (ISA), accompanied by a written opinion regarding the patentability of the
invention, which is the subject of the application. It is optionally followed by a
preliminary examination, performed by an International Preliminary Examining
Authority (IPEA).Finally, the relevant national or regional authorities administer
matters related to the examination of application (if provided by national law) and
issuance of patent.
 A PCT application does not itself result in the grant of a patent, since there is no such
thing as an "international patent", and the grant of patent is a prerogative of each
national or regional authority. In other words, a PCT application, which establishes a
filing date in all contracting states, must be followed up with the step of entering into
national or regional phases to proceed towards grant of one or more patents. The PCT
procedure essentially leads to a standard national or regional patent application, which
may be granted or rejected according to applicable law, in each jurisdiction in which a
patent is desired.
 The Patent Cooperation Treaty (PCT) assists applicants in seeking patent protection
internationally for their inventions, helps patent Offices with their patent granting
decisions, and facilitates public access to a wealth of technical information relating to
those inventions. By filing one international patent application under the PCT,
applicants can simultaneously seek protection for an invention in a very large number
of countries.
 The contracting states, the states which are parties to the PCT, constitute the
International Patent Cooperation Union.
 MODULE 3

Trade in IPR
(10)
3.1 The link between trade and IP
3.2 Aligning Business Objectives and IP
3.3 Identifying and Securing IP Rights
3.4 Importance of Commercialization
3.5 Assignment and Licensing of Intellectual Property
3.5.1 Due diligence
3.5.2 Trademark licensing
3.5.3 Copyright licensing
3.5.4 Licensing of Patent and Technology
3.5.5 International consideration in licensing
3.5.6 Anti Competition issues
3.6 Specific Agreements for commercialization of Intellectual Property:
3.6.1 Non-disclosure Agreements
3.6.2 Material Transfer Agreement
3.6.3 Research Collaboration Agreement

Explain the types of licensing of IP and specifically discuss the legal requirements for
licensing copyright in India.

Explain the types of licensing of IP and specifically discuss the legal requirements for
licensing copyright in India.

What is meant by licensing of IP? While drafting a copyright licensing contract concerning
publication rights in relation to a literary work what are the points that must be considered?

What is licensing? What are the different types of licensing? How does licensing serve as a
mode of commercialization of IP

What is commercialization of IP? What are the standard considerations in IP licensing

agreements.

Link between trade and IP

 The world economy has undergone significant transformations in the last two
decades.
 These changes have led to an increase in global trade and its scale.
 Advancements in computing, telecommunications, biotechnology, and chemistry have
played a role in these changes.
 These advancements have affected the productive structures of different economies.
 There is now a greater emphasis on Intellectual Property (IP) and its protection.
 Free-trade zones have been established, leading to the growth of international
economic and trade relations.
  There is increased awareness of the importance of protecting IP rights.
 Intellectual Property refers to creations of the mind, such as inventions, artistic works,
and symbols used in commerce.
 Laws governing IP provide a formal mechanism for establishing property rights in
intellectual assets.

Protection of Intellectual Property

 Intellectual property rights (IPR) are exclusive legal rights granted by the government
to individuals or firms to use copyrights, trademarks, patents, or industrial designs for
a specific period.
 The international use of IP is important for trade, foreign direct investment (FDI), and
technology licensing across borders.
 There is a growing need for systematic changes to address the tension between the
international exploitation of intellectual assets and territorial restrictions on IPR.
 Countries have engaged in bilateral and multilateral negotiations on IPR to establish
minimum standards.
 The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS),
initiated by the World Trade Organization (WTO), is a significant achievement in this
regard.
 In international markets, it is crucial to protect patents for any product or service.
 Some concepts of protection, like trade secrets, have emerged in certain fields.
 Trade secrets are valuable industrial processes and strategies that may not be
patentable or worth the expense of patenting, but provide advantages if kept
undisclosed.
 Trade secrets are protected through legal rules against unfair expropriation.
 However, intellectual property (IP) is governed by national laws, and IPR granted in
one country are not automatically recognized and enforceable in another country
unless the owner takes specific steps to protect their IPR in that country

Trade-Related Aspects of the Intellectual Property Rights

 The Trade-Related Aspects of Intellectual Property Rights (TRIPS) is an initiative of
the World Trade Organization (WTO).
 TRIPS was created to establish better protection for intellectual property rights (IPR)
through the efforts of certain governments and private organizations.
 TRIPS provides guidelines for resolving disputes, enforcing IPR, and handling
transitional arrangements for WTO member countries that lack strong intellectual
property systems.
 There is a growing need to address international inconsistencies to promote free trade
and provide certainty in business practices.
 The global market relies on mutual cooperation and interdependence.
 Article 45 of TRIPS lacks international consistency due to its discretionary nature.
 It is important to balance domestic laws with the long-term strategy of TRIPS.

Economic Indicators of Intellectual Property Issues

 Intellectual property rights (IPR) can directly impact a country's economic growth by
promoting innovation and improving productivity in various sectors.
 IPR can affect foreign direct investment (FDI), technology transfers, and trade, which
can influence a country's economic growth.
  Studies have shown that the relationship between IPR protection and development is
not linear. Patent protection tends to weaken as economies progress beyond the
poorest stage into middle-income stages, where they have greater abilities to imitate
new technologies.
 Economic indicators are used to measure trade-related intellectual property, but some
indicators like national or sector trade balances may not be suitable for policy
purposes and are often debated.
 Comparing the number of patent filings or copyright registrations between countries
to gauge the success of intellectual property can be inaccurate.
 The impact of copyright on an economy is not clear-cut. It is uncertain whether
reduced or increased copyright provisions lead to more or fewer publications, films,
websites, or pro-competitive or anti-competitive business practices.
 However, there is an economic impact related to copyright protection when
considering income distribution as an economic policy issue rather than just a social
policy matter.

Case Study
 In the case of First Flight Associates v. Professional Golf Co., Inc., Professional Golf
manufactured and sold golf equipment under the brand name "First Flight."
 Professional Golf entered into an agreement with Robert Wynn, who acted as a
foreign sales representative in Japan without a formal agency or distribution
agreement.
 Robert Wynn later incorporated First Flight Associates, Inc. (FFA) to continue the
activities agreed upon with Professional Golf in Japan.
 The parties executed a trademark agreement in 1967, allowing FFA to use the "First
Flight" trademark on golf soft goods in exchange for royalty payments.
 FFA attempted to sublicense the trademark to a Japanese company called "Teito" for a
higher royalty, but Professional Golf tried to terminate its sales agency relationship
with FFA.
 FFA sued Professional Golf for breach of contract, but Professional Golf was not
entitled to royalties earned by FFA because it failed to protect its trademark rights
under Japanese law.
 In India, trademarks that have acquired trans-border reputation can be protected even
if the brand hasn't been marketed in India.
 The Bombay High Court in the case of Kamal Trading Co. v. Gillette, UK Ltd.
recognized that goodwill of a brand is not limited to a particular country due to
international trade and global marketing strategies.
 In the case of NR Dongre v. Whirlpool Corporation, the Court found that the
trademark “Whirlpool” had a trans-border reputation and was associated with the
respondents for a long time, extending its protection to India.

Aligning Business Objectives and IP

Stage I: Innovation – capturing, managing, and protecting critical inventions involves the
initial steps in the intellectual property (IP) lifecycle. It includes activities such as ideation,
research, and development of new inventions or technologies. During this stage, it is crucial
to identify and document inventions, assess their potential value, and determine the
appropriate IP protection strategy. This may involve filing for patents, copyrights,
trademarks, or trade secrets to safeguard the inventions and prevent others from using them
without permission.
To effectively manage and protect critical inventions, organizations often implement
processes and systems to capture and document new ideas and inventions. This can include
invention disclosure forms, innovation management software, or internal communication
channels to encourage employees to report their inventions. Proper documentation and
record-keeping are essential for tracking the progress of inventions and evaluating their
commercial potential.
Stage 2: Portfolio management – tracking and analyzing IP assets refers to the ongoing
management of an organization's IP portfolio. This stage involves monitoring and organizing
the intellectual property assets, such as patents, trademarks, copyrights, or trade secrets, that
the organization owns or has acquired. The goal is to understand the value and strategic
importance of each asset, assess potential risks and opportunities, and make informed
decisions about the portfolio.
In this stage, organizations typically use IP management tools or software to track and
analyze their IP assets. These tools can provide insights into the competitive landscape,
identify potential infringement risks, assess the strength of existing IP rights, and evaluate the
potential for licensing or collaboration opportunities. By actively managing the IP portfolio,
organizations can make informed decisions regarding resource allocation, budgeting, and
strategic planning.
Stage 3: Commercialization – boosting revenues and monitoring agreements focuses on
leveraging IP assets to generate revenues and maximize their commercial potential. This
stage involves activities such as licensing, technology transfer, joint ventures, strategic
partnerships, or the creation of new products and services based on the protected inventions.
During the commercialization stage, organizations engage in negotiations and agreements
with potential partners or licensees to monetize their IP assets. This may involve licensing
agreements, where other companies pay royalties or fees to use the intellectual property, or
technology transfer agreements, where knowledge and technology are transferred to third
parties for commercialization. Monitoring agreements and ensuring compliance with
contractual obligations is also critical to protect the organization's IP rights and maximize the
value derived from the commercialization efforts.
Throughout these three stages, it is important for organizations to have a comprehensive IP
strategy in place, aligned with their overall business goals. This includes regular evaluation
and review of the IP portfolio, staying updated on changes in IP laws and regulations, and
maintaining a proactive approach to innovation and commercialization.

Importance of Commercialization
 IP commercialization means turning an idea or innovation into a profitable product or
service.
 Selling such products or services is the most common way to make money from
creative ideas.
 Intellectual property rights (IPRs) are crucial in preventing competitors from illegally
using protected features.
 For example, a medical company that creates a new medicine should be able to earn
returns on its investment in developing the formula.
 Commercializing IP involves more than just protecting and defending your
intellectual property through applications.
 There are various methods to commercialize IP, such as assignment, joint ventures,
licensing, collaborations, and partnerships.
  We will explore all these ways of monetizing creativity

Steps for IP Commercialization

Step 1: Market Analysis
 Analyze the market where the product or service will be sold.
 Consider factors such as market size, demand, competitors, legislative framework,
and potential partners.
Step 2: IP Audit
 Conduct an audit of all intellectual property rights (IPRs) owned or used by the
company.
 Identify trademarks, product inventions, trade secrets, packaging designs, legal
documents, client lists, and internal policies.
 Ensure the protection of these assets through registration or other means.
Step 3: IP Valuation
 Estimate the economic value of registered and unregistered IPs.
 Consider factors such as their ability to eliminate competition and usefulness to the
owner.
 Use income or market methods for valuation, involving professionals to assess the
assets.

Assignment and License of Intellectual Property

Licence
 License means grant of permission by one person to another to do something that the
first person has a legal right to prohibit.
 The person giving permission, who is also the owner of IP is known as Licensor. The
person to whom permission is granted is known as licensee.
 The legal document evidencing the permission given by the licensor to licensee is
referred to as a “license contract”. It records the terms and conditions and monetary
compensation which is payable by the licensee to licensor.
 There are various types of Intellectual properties. For Example, Copyrights,
Trademarks, Patents, and trade secrets. A person owning them may authorize another
to use, sell or utilize the said rights in his product and earn revenue from it. In return
the Licensee gives the owner or Licensor a fixed amount for exchange or a royalty
fee.
Assignment
 When the owner of intellectual property (IP) transfers all their rights to someone else,
without any limitations or conditions, it is called an assignment. This means that the
owner gives up all rights to the IP and gives them to another person.
 Transferor is called assignor and the transferee is called as assignee.
 When an assignment takes place, the assignor no longer has the rights in respect of
such IP and the assignee becomes the new owner of such IP and is entitled to exercise
all the rights which were conferred by the law on assignor.

For both licensing and assignment, there is a need to have an agreement between the parties.
The Licensing Agreement is between the licensor and licensee while the Assignment deed is
between the assignor and the assignee. Any IPR can be licensed for eg. Copyright, trademark,
design, or patents. Copyrights, trademarks, geographical indications, patents rights and
designs, etc. can be assigned.

Types of Licenses
1. Exclusive License: In this case the Licensor gives his complete rights to the licensee to the
exclusion of all, including himself. The licensee can thus become the exclusive holder of the
said property.
2. Sole License: In this case, the Licensor gives the right to the licensee to use the property,
while also keeping the said rights with himself. IN such case, the said rights can be exercised
by the licensor and the licensee but cannot be transferred to a third party.
3. Non- Exclusive License: In this case, the Licensor gives the rights to the Licensee to use
the rights but reserves the right to license the said rights to any third party also.

Types of Assignments
1. Legal Assignment: The assignment fulfils all the terms of assignment and the assignee can
sue independently. The priority of written notice is important.
2. Equitable Assignment: In equitable assignment, the assignment operates on trust and there
is no requirement of a written notice. The title of the assignee is protected and recognized in
equity. It is created when the assignment cannot fulfil the requirements of a legal assignment.
The major difference here is that of priority. The equitable assignee has to sue for its rights
along with the Assignor.
3. Mortgages: These play an important part in the IP Financing sector. In fact IP mortgages
has led to companies financing the intellectual property assets of companies for millions.
Mortgages here mean a company mortgaging its intellectual property asset for a loan. They
help to get credit facility with banks.

IP Due Diligence

 IP due diligence is the evaluation of an IP portfolio of any business, “checking valid

intellectual property rights subsisting therein and scope of their protection, analyzing
the risks involved with respect thereto and in turn, assessing their potential value”.
 IP due diligence is an exercise which provides comprehensive knowledge of the value
and risks of a company’s intangible assets.
 Any business transaction involving IP, the due diligence is designed to examine and
analyze the strength, scope and future potential that could be derived from the
intangible assets- patents, copyrights or trademarks.

Importance of Due Diligence

 IP due diligence helps a business reorganize its operations with the aim of enhancing
the marketability of its products or services
 IP due diligence helps to maximise the value of these intangible assets which can
boost the company’s balance sheet
 Ignoring IP due diligence could over-value or devalue the assets that have to be
acquired
 IP due diligence helps to reveal risks and allows the acquirer to tackle the issues pre-
close

How to conduct IP due diligence

  The task of conducting an IP due diligence requires professional skills and should be
conducted thoroughly.
 Ideally, IP due diligence should be conducted at the onset of the negotiations as it
helps to identify any legal issues which may affect the value of the IP.
 When more time is allowed to complete due diligence investigation, this not only
helps to determine a more reasoned value of the IP, but corrective action can
proactively be taken if any legal concerns are identified.
Though every business transaction is different from each other and will have a different set of
requirements for conducting an IP due diligence. Some of the general requirements that
should be involved in an IP due diligence are:
1. Identify the IP assets: Find out what intangible assets the business has, like patents,
domain names, trademarks, and brand names.
2. Verify ownership and existence: Check who owns the IP and if they really have the
rights to it. Make sure there are no issues that would prevent them from transferring
the rights to someone else. If the ownership is disputed, it means the seller can't give
the rights to others. Also, see if the rights were obtained properly from the original
owner.
3. Check territory and terms: See where the IP rights apply. They usually only cover
specific territories. If the business operates in multiple countries and the IP rights
don't cover all of them, it could cause problems later. Also, check how long the IP
rights last, as they have a limited time period. Copyrights can be protected forever.
Look into the local laws to find out the validity of different IP assets.
4. Look for third-party claims: Check if there are any other people or companies
claiming rights or interests in the seller's IP. Sometimes other rights can exist without
anyone knowing. Review licenses, agreements, and understandings to see if any
exclusive rights were granted. You can also check the records of the IP office to find
any discrepancies.
5. Evaluate potential infringements: See if anyone else is infringing on the company's
IP rights or if the company might be infringing on someone else's rights. If there are
any issues, it could disrupt the business. Conduct a search to see if the company can
use or sell its IP without infringing on others' rights. This helps identify any potential
problems. If any issues are found, steps can be taken to avoid problems in the future.

Trademark Licensing

Trademark licensing lets a registered owner authorize others to use their mark in trade
without transferring ownership. The owner can set limitations and terms in the licensing
agreement, such as specifying goods or services. It allows others to use the mark while
maintaining ownership control.

Trademarks Act
The Trade Marks Act of 1999 does not mention "license" or "licensing" specifically. Under
the Act, Sections 48-55 provide provisions for trademark licensing. The term "Registered
user" in the Act is essentially the same as a licensee and the "Permitted use" refers to using a
registered trademark with consent or as a registered user. The Registering of a licensing
agreement is not mandatory, but a written agreement is necessary. The Common law
recognizes licensing of unregistered trademarks, with no distinction in licensee rights.

Importance
  The arrangement benefits both the owner and the person using the trademark. The
owner earns money from royalties, while the person using the trademark gets to
benefit from its popularity and use it to sell their products or services.
 However, it's important to make sure that the quality of the products or services
associated with the trademark is maintained. To do this, the license agreement should
include clauses that control the quality of what is being offered. The law even requires
that these clauses specify the level of quality control.
 In the UTO Nederland BV v. Tilaknagar Industries Ltd case, it was shown how
important it is to have quality control and maintain a connection between the owner
and the licensee. If there is no connection in how the trademark is used in business or
if the licensing arrangement is not properly controlled, the license can be considered
invalid. This means that the licensee may not have the legal right to use the trademark
anymore.

Permission to Use
Trademark licensing grants the licensee the right to use the trademark owned by the licensor.
The license agreement specifies the terms and conditions under which the licensee can use
the trademark, including the scope of use, the duration of the license, and any limitations or
restrictions.

Number of Licensees
The license agreement may determine the number of licensees permitted to use the
trademark. The licensor can choose to grant exclusive rights to a single licensee or non-
exclusive rights to multiple licensees. Exclusive licensing means that only one licensee is
authorized to use the trademark within a designated territory or industry.

Quality Control
Trademark licensing agreements typically include provisions for quality control. The licensor
has a vested interest in maintaining the reputation and integrity of the trademark. Therefore,
they may require the licensee to adhere to certain quality standards and guidelines to ensure
that the licensed products or services meet the expected level of quality associated with the
trademark.

Marketing
The license agreement may define the marketing aspects of the licensed trademark. This can
include specifying the designated territory in which the licensee can use the trademark, as
well as requiring the licensor's approval on advertising materials or marketing strategies used
by the licensee. The licensor may want to ensure that the licensee's marketing efforts align
with the brand image and values associated with the trademark.

Financial Arrangements
Trademark licensing agreements typically address financial arrangements between the
licensor and licensee. These arrangements may include royalty payments, which are a
percentage of the licensee's sales revenue generated from the use of the trademark.
Additionally, the agreement may outline any other financial obligations or costs to be borne
by the licensee, such as payment of skilled personnel, instructions to employees to maintain
prescribed standards, or allocation of funds for sampling procedures.

Record-Keeping
The license agreement may require the licensee to maintain detailed books and records of the
sales of the trademarked products or services. This allows the licensor to monitor the
performance of the licensed trademark and ensure accurate reporting of royalties or other
financial obligations.
Trademark licensing is a beneficial practice for the controlled exploitation of a trademark,
benefiting both the licensor and the licensee in their respective business growth. It also
contributes to the development of the brand image as the licensee is required to maintain a
certain level of control and quality standards for the goods and services associated with the
mark.

Copyright Licensing
License is a personal right which cannot be transferred except in certain circumstances. It is a
right to do some positive act. It is a personal right and creates no more personal obligation
between a licensor and licensee. The license is generally revocable at will of the grantor.

Voluntary license (Section 30)

 According to section 30 of the Copyright Act 1957, the owner of the copyright in a
work may grant any interest in his copyright to any person by license in writing,
which is to be signed by him or by his duly authorised agent.
 A license can be granted not only in existing work but also in respect of the future
work, in this situation assignment shall come into force when such future work comes
into existence.
 Where a licensee of the copyright in a future work dies before such work comes into
existence, his legal representatives shall be entitled to the benefit of the license if
there is no provision to contrary

The type of license is similar to a assignment deed that gives permission to do something, but
with some changes in section 19 (section 30A). So, just like a assignment deed, a license
deed for a creative work should include the following information:
 How long the license is valid for.
 Which rights are allowed by the license.
 Where the license applies (the area or region).
 How much money needs to be paid as royalty.
 Rules about changing or updating the license.
 How the license can be extended or ended.

Types of Licenses:
 Exclusive: license which confers on licensor or licensee and persons authorized by
him to the exclusion of all other person (including the owner of the copyright) any
right comprised in the copyright in a work.
 Non-exclusive: the owner of the copyright retains the right to grant licenses to more
than one person or to exercise it himself.

Compulsory License
Being a member of Berne Convention, India has incorporated the provision of compulsory
license in the Copyright Act, 1957. The Act provides for grant of compulsory license for
Indian work in the public interest, in certain circumstances:
Works Withheld from Public (Section 31)
In India, certain works are kept away from the public, but the Copyright Act allows for
compulsory licenses in such cases. If someone wants a license but the owner refuses, they can
complain to the Appellate Board. The Board can grant a license if specific conditions are met.
If there are multiple complaints, the license goes to the one serving the public interest.
Super Cassette Industries Ltd v. Entertainment Network (India) Ltd.: involving sound
recordings, the Copyright Board issued a compulsory license after failed attempts to obtain
one from Super Cassette Industries Ltd (SCIL). The decision was appealed in the Delhi High
Court, which emphasized the need for valid reasons when refusing licenses. The case was
sent back to the Copyright Board for further review.

Compulsory License in Unpublished or Published Work (Section 31-A)

Section 31-A allows for a compulsory license in certain situations. If the author is unavailable
or the copyright owner cannot be found, anyone can apply for a license to publish the work.
The applicant must publish their proposal in a newspaper before applying. The application
should be submitted with the required form, fee, and a copy of the published advertisement.
The Copyright Board will conduct inquiries and grant a license to the applicant. The license
will require payment of royalty and other conditions set by the Copyright Board.

Compulsory License for the Benefit of Disabled Persons (Section 31-B)

Section 31-B allows for a compulsory license to benefit disabled individuals. A person
working for the benefit of disabled individuals can apply for a license to publish a
copyrighted work. The Appellate Board may extend the license and allow more copies to be
published upon subsequent application and consultation with the rights owners.

Statutory License for Cover Versions (Section 31-C)

Section 31-C allows for a statutory license for cover versions of works. A cover version is a
sound recording made with the owner's consent or license. Prior notice must be given to the
owner and Registrar of Copyright before making the cover version. Copies of covers or
advance royalties must be provided. A minimum royalty is required for a certain number of
copies each year.
Star India Pvt Ltd v. Piyush Aggarwal: The Delhi High Court clarified that subsequent
original recordings are also included as cover versions.

Statutory Licensing for Broadcasting of Literary and Musical Work and Sound
Recording (Section 31-D)
Section 31-D allows for statutory licensing for broadcasting literary, musical works, and
sound recordings. Broadcasting organizations can communicate works through television or
radio by giving prior notice to copyright owners. Royalties must be paid to the owners, with
different rates for TV and radio. The Copyright Board can request advance payment from the
broadcasting organization.

License for Translation (Section 32)

Section 32 allows a license to translate and publish literary or dramatic works. After specific
time periods, anyone can apply for a translation license. The time periods depend on the
origin and language of the work.

License to Reproduce and Publish Works (Section 32-A)

Section 32-A allows for a license to reproduce and publish literary, scientific, or artistic
works. After a specific period, anyone can apply for this license. The license applies if the
work is not available in India or has not been on sale for a certain period. The eligibility
periods vary depending on the type of work.

Licensing of Patent and Technology

 Patent Licensing is an act of or a process of granting, to a third party, permissions to
extricate benefits by selling and using the licensed product. The patent owner gives
license to a third person to use, sell and extract benefits from his patented invention,
for an amount already decided as royalty.
 A patent owner can give away or transfer his interests in a patent to a third person.
The licensor gives away his rights on the invented patented intellectual property for a
period of time over a mutual agreement. During such a period, the licensee can extract
benefits and have rights on the interest on the patent. He may use and make the
licensed design and can also gain profits during the licensed period.
 As per Section 68 of the Patent Act, 1970, for a patent license to be valid, the
agreement must be in writing. In the case of PVR Pictures Ltd. v. Studio 18 [2009
SCC OnLine Del 1878 : (2009) 41 PTC 70]. Delhi HC held that term sheet agreement
shall not amount to a license agreement.

Types of Patent License

1. Exclusive License:
 An exclusive license transfers all the rights of a patent to the licensee, except
for the title.
 The licensee has the same rights as the patent owner, except for the ability to
transfer the patent to someone else.
 This restriction exists because the title of the patent remains with the original
owner, even though all other rights are transferred.
 An exclusive license is granted exclusively to a specific party and cannot be
further transferred.
 With this type of license, the risk of patent infringement is minimal because
fewer rights are being exploited, and the licensee has a monopoly over the
market.
2. Non-exclusive License
 In a non-exclusive license, the licensee has the right to sell and produce the
patented design, but it's not an exclusive right.
 The patent owner can give permission to other people as well to use and produce
the patented design.
 In this case, multiple individuals or companies have the right to make, use, and
sell the patented design.
 The rights granted by this license are not limited to a specific licensee.
3. Sub-license
 A sublicense is when the licensee gives permission to other organizations to make
the products.
 It is like granting certain rights to a third party to use the licensed product.
 The sublicense allows another party to produce and sell the product based on the
original license.
4. Cross-license
 Cross license is when different organizations and individuals exchange licenses
with each other.
 It is used when a product needs support from another product to succeed in the
market.
 It involves an agreement between two companies to share their patent portfolios.
 Recently, Ericsson and Oppo made a cross license agreement, where they
exchanged patents related to technologies like 2G, 3G, and 4G.
5. Compulsory License
 Compulsory license is when the government allows individuals or organizations to
use, sell, or make a patented product, even if the patent owner does not agree.
 It is done for the benefit of the public.
 This type of license is commonly granted in the pharmaceutical industry and for
products that meet specific criteria mentioned in the Patents Act, 1970.
 The first compulsory license in India was given to Natco Pharma Ltd. on March 9,
2012. They were granted permission to produce a generic version of a patented
medicine called Nexavar, which belonged to Bayer Corporation.

Advantages of Patent Licensing:

 Risk Transfer: The patent owner can transfer the risks associated with manufacturing
and production of the patented design or product to the licensee.
 Global Market Access: Patent licensing allows other organizations to produce the
patented products, enabling mass production and entry into the global market.
 Limited Period: The license has a specific duration, so the patent owner regains
exclusive rights over their invention once the license expires.
 Competitive Advantage: Licensing to established organizations with a large
customer base gives the patented product a wider market and a competitive edge over
other patents.

Disadvantages of Patent Licensing:

 Difficulty in Finding Licensees: It can be challenging and time-consuming to find
suitable licensees for the invention. Finding the right licensee and establishing a
structured agreement are crucial for success.
 Loss of Control: During the license period, the patent owner partially or fully loses
control over their own invention, as the licensee assumes the rights.
 Risk of Licensee's Ability: The success of the patent product depends on the
licensee's efficiency and abilities to commercialize it. Poor strategy and quality
management by the licensee can negatively impact the patent's reputation and success.

Common Mistakes in Patent Licensing:

 Using Patented Design Without Signed Agreement : The licensee may
unintentionally infringe on the patent by using or selling the patented design or
product before signing the license agreement. It is important for the licensee to ensure
that the agreement is signed before any use or sale of the patented item.
 Granting License to Incompetent Parties: In their eagerness to grow quickly, some
inventors may choose a licensee who is not capable or competent enough to
successfully commercialize their product. This can lead to failure in the market
instead of thriving, had a more suitable licensee been chosen.
 Lack of Awareness of Owner's Liability: Licensees may overlook the fact that the
licensor (patent owner) still holds liability for the patented product or design, even
during the license period. The owner can be held responsible for any issues or
liabilities arising from the invention, even when it is licensed to someone else.
Approaches to Patent Licensing
 Carrot Licensing: The patent owner convinces a person or organization to use their
patented technology or product by highlighting the benefits of licensing. It involves
showcasing how the licensee can gain value, improve their own products, or access
new markets by utilizing the patented technology.
 Stick Licensing: The patent owner takes action against a person or organization that
has already used or is currently using the patented design, technology, or product
without permission. The owner can file a lawsuit for patent infringement or choose to
settle with the infringer by offering a license agreement to legitimize the use of their
patent.
Authorization of Use
Patent licensing grants the licensee the right to use the patented invention owned by the
licensor. The license agreement specifies the terms and conditions under which the licensee
can use the patented technology. This includes the scope of use, duration of the license, and
any limitations or restrictions.

Patent Information
The license agreement should include important details about the patent being licensed. This
includes specifying the country or countries where the patent is registered and providing the
patent number for easy identification. This information ensures clarity regarding the specific
patent being licensed.

Technical Subject Matter

The license agreement may include a brief narration or description of the technical subject
matter covered by the patented invention. This helps the licensee understand the scope and
applicability of the patented technology and its potential uses.

Annexure
The license agreement may include an annexure that provides additional information related
to the patent. This can include details about related patents, if applicable, in different
countries. The annexure helps in clarifying the licensing scope across various jurisdictions.

Setting of Exclusive Rights

The licensor has the option to set the rights granted to the licensee as exclusive or non-
exclusive. Exclusive rights mean that only the licensee has permission to use the patented
technology, while non-exclusive rights allow multiple licensees to use the same invention.
The license agreement should clearly specify whether the rights granted are exclusive or non-
exclusive.

Type of License
The license agreement may define the type of license being granted. This can include
exclusive, sole, non-exclusive, or simple licenses. An exclusive license means that only the
licensee has the right to use the patented technology, while a non-exclusive license allows
multiple licensees to use it. A sole license grants limited rights, often excluding the licensor
from using the patented technology. A simple license grants basic usage rights without any
specific exclusivity.

Infringement
The license agreement should address the issue of infringement. It should grant the licensor
the right to institute infringement proceedings in case the licensee or any third party violates
the terms of the license agreement or infringes upon the patent rights. This allows the licensor
to protect their patent and take legal action if necessary.

International Consideration in Licensing

1. Brand Identity
2. Selecting a Licensee
3. License Grant
4. Territory
5. Royalties and other payments
6. Approvals and other controls
7. Term and termination

Anti-Competition Issues
Intellectual property refers to an original idea that can be used for making money. Intellectual
Property Rights (IPR) are the legal rights that protect this idea from being stolen or copied by
others, and only the original creator has the right to make money from it. These rights are
given to people who come up with new inventions or innovative ideas. They last for a certain
period of time and prevent others from using, copying, or stealing the idea. If someone uses
the idea without permission, the creator can sue and claim damages. This is to prevent unfair
competition.
Competition laws, on the other hand, promote fair competition in the market. They aim to
protect consumers and encourage innovation and productivity by preventing dominant
companies from creating a monopoly. Intellectual property laws are an exception to this rule,
as they give creators the right to control and profit from their ideas. However, there are some
provisions in place to prevent anti-competitive practices related to intellectual property.
One such provision is anti-competitive agreements, which are agreements that limit
competition and allow one company to dominate over others. There are two types: horizontal
agreements made between direct competitors and vertical agreements made between
producers and middlemen. These agreements can negatively affect the economy and
consumer rights. The Competition Act prohibits any person or company from entering into
such agreements that disrupt competition in India.
However, there are exceptions to this rule. The Competition Act allows for reasonable
conditions to protect the rights mentioned under copyright, patent, trademarks, geographical
indications of goods, and design acts. It also doesn't interfere with the person's right to export
from India as agreed. The exact definition of "reasonable conditions" is not provided in the
Act and is open to interpretation based on past cases.
Anti-Competitive Practices in Intellectual Property Rights
1. Patent Pooling:
 Patent pooling is when multiple patent owners agree to combine their
inventions under one license.
 It promotes fair competition and prevents the exploitation of the market.
 It can restrict new entrants in the market and secure long-term profits.
 This practice is common in the electronics and pharmaceutical industries.
2. Tie-Up Arrangement:
 A tie-up arrangement is a restrictive trade practice.
  It occurs when a buyer agrees to purchase one product on the condition of
buying another product.
 There are certain requirements for a tie-up arrangement, including having two
products, the seller having market power, and an exclusive supply and
distribution agreement.
 This practice restricts competition as transactions are limited to a specific
group of people.
3. Post-Patent Royalty:
 Even after a patent expires, there are provisions that enforce the continued
payment of royalties.
 If market conditions restrict competition in research and development or
prevent licensees from using technology, the exceptions granted under the law
may be removed.
4. Anti-Competitive Practices in Intellectual Property Rights:
 Challenging the validity of intellectual property rights is considered an anti-
competitive practice.
 Licensees should only grant back to the original licensor, not to others, to
maintain their privileges.
 Fixing prices for the licensee and pressuring them to sell at a specific price is
an anti-competitive practice.
 Restricting the licensee's ability to trade in certain territories is considered
anti-competitive.
 Coercing the licensee to apply for unnecessary licenses is a restricted trade
practice.
 Imposing quality control agreements that go beyond what is necessary is an
anti-competitive practice.
 Restricting the licensee's rights to sell the licensed products according to the
licensor's orders is a restrictive trade practice.
 Unfair restrictions on the use of the trademark by the licensee are considered
unfair practices.
 Imposing undue restrictions on the licensee's business operations is a restricted
trade practice.
 Limiting the maximum use of the patented invention by the licensee can
negatively affect competition and innovation.

Non-Disclosure Agreements
 NDAs are legal contracts that establish the conditions for sharing confidential
information between parties.
 There are two types of NDAs: one-way and two-way. One-way or Unilateral NDAs
involve one party sharing information and the other party receiving it. Two-way or
Bilateral NDAs involve both parties sharing information.
 In some cases, two separate one-way NDAs can be signed instead of a two-way
agreement to make negotiations easier.
 NDAs can involve any type of valuable information, such as ideas, inventions,
formulas, research, or business details.
 The main purpose is to keep the shared information confidential and prevent it from
becoming public knowledge.
Commonly Used Provisions in NDAs
1. Confidential Information
 Definitions are important in agreements, including non-disclosure agreements
(NDAs).
 In NDAs, there is usually a definition for "confidential information," which
specifies certain information and documents agreed upon by the parties.
 However, in some cases, it may be difficult to precisely define such information,
especially in long-term partnerships and research and development (R&D)
projects.
 It is important to consider whether all information should be protected, regardless
of its format (written, oral, electronic), or if only information marked as
confidential should be covered and recorded in writing after disclosure.
 The choice depends on the risks involved. Not requiring documentation may be
easier for researchers in long-term projects, but there is a risk of forgetting to mark
information as confidential, leaving it unprotected.
 Requiring information to be recorded makes it less likely to overlook the
confidential nature of specific information and provides evidence of what is
considered confidential.
 It's important to ensure that everyone handling the information (employees,
researchers, students) is aware of the obligation to mark it as "confidential."
2. Restricting the use of the information to a specific purpose
 NDAs also include restrictions on how the receiving party can use the confidential
information.
 This restriction is often referred to as the "permitted purpose."
 For example, if you're using an NDA to protect information during negotiations for
a license agreement or consortium agreement, you would want the receiving party
to use the information solely for evaluating entering into that specific agreement.
 Other uses of the information, such as conducting research, should be explicitly
prohibited.
 Examples of permitted purposes may include evaluating the technology, exploring
research collaborations, discussing the possibility of a consortium agreement, or
assessing the information for a potential joint venture.
3. Limiting the disclosure of information
 A key obligation in NDAs is to keep the information confidential and not disclose
it to third parties.
 However, when sharing information with companies or organizations like
universities, it's important to consider that they may need to share it with their
employees, students (in the case of universities), or external consultants.
 To accommodate this, some limitations are typically imposed to prevent
indiscriminate disclosure to all individuals.
 NDAs often include a clause that allows disclosure of the information on a "need-
to-know" basis to employees, students, and sometimes external consultants.
 However, these individuals must be aware of the confidential nature of the
information and have equivalent obligations to keep it confidential.
4. Listing excluded information in NDAs
 In most NDAs, there are certain types of information that are not covered by
confidentiality obligations.
  Without a clear exception in the NDA, the receiving party could breach the
contract even if they disclose the information due to a legal obligation, such as in
a court proceeding.
 To avoid such situations, the following types of information are typically
excluded:
 Information that is already part of the public domain at the time of disclosure.
 Information that becomes part of the public domain after the disclosure, as
long as it wasn't a result of a breach of the NDA.
 Information that the receiving party already knew before the disclosure.
 Information that must be disclosed by law or a competent authority.
5. Defining the Length of Confidentiality Obligations in NDAs:
 NDAs specify how long the obligations to keep information confidential must be
upheld.
 The term can be indefinite, meaning there is no specific end date, or it can be
defined with a certain number of years (e.g., 3, 5, 7, or 10), after which the
receiving party can disclose the information without breaching the contract.
 The choice of the term depends on the type of information and the specific
circumstances of the case.
 For example, if the information is something like non-patentable know-how or
customer lists, it may be appropriate for it to be kept confidential indefinitely until
it is no longer considered confidential.
6. Determining the choice of law and jurisdiction:
 It's important to determine which laws and courts will apply in case of a dispute in
agreements, especially for cross-border partnerships.
 Parties can consider including clauses that specify the applicable law and
jurisdiction.
 Additionally, they can include clauses for alternative dispute resolution (ADR)
procedures as an alternative to going to court.
 ADR mechanisms have advantages such as avoiding the high costs of litigation
and resolving the dispute faster and in a confidential manner.

Limitation and Risks

 While Non-Disclosure Agreements (NDAs) are useful for protecting information,
they have limitations that should be considered.
 The best way to protect confidential information is by not disclosing it at all. NDAs
alone are not foolproof locks.
 If an NDA is breached, you may need to initiate litigation proceedings to recover
damages, which can be costly, time-consuming, and may risk exposing the
confidential information.
 It's important to use NDAs only when disclosing truly confidential information and
carefully consider if sharing the information is necessary to achieve your goal.
 Before using NDAs, consider how they can help you maximize your objectives while
minimizing risks. It's a strategic decision.
 NDAs should be used alongside other security measures to enhance protection, such
as physical security (locking documents, maintaining a logbook) and digital security
(using passwords, blocking USB drives).
 Taking additional steps to safeguard and manage confidential information is crucial
for comprehensive protection.
 Material Transfer Agreement
What is a Material Transfer Agreement (MTA)?
 A Material Transfer Agreement (MTA) is a legally binding contract that governs the
transfer of tangible biological materials between two or more parties.
 It involves the transfer of tangible property (such as biological samples) from one
party (the provider) to another party (the recipient), without transferring ownership.
 The provider retains ownership of the transferred property, and the recipient holds and
uses the materials according to the terms specified in the agreement.
 The MTA may also address the transfer of intellectual property (IP) rights if the
materials are subject to patents or patent applications.
 The MTA defines the rights and responsibilities of both the provider and the recipient
regarding the materials and any derivatives that may be created.

Important considerations about MTAs:

 Researchers usually cannot sign MTAs on behalf of their institutions. These
agreements need to be reviewed and approved by authorized institutional officials.
 Agreements that are not signed by an institutional official may not be valid or
enforceable.
 The responsibility for fulfilling the obligations of the MTA lies with the researcher
using the materials.
 Most MTAs require the signature of the recipient, acknowledging their recognition of
their responsibilities and duties under the agreement.

Structure of a Material Transfer Agreement

 A Material Transfer Agreement (MTA) is a contract for transferring tangible property,
like biological materials, between two or more parties.
 MTAs can be short or long, depending on the complexity of the agreement.
 The preamble of an MTA introduces the parties involved, specifies the effective date,
and may provide background information on the materials and research goals.
 Definitions section clarifies terms used in the agreement, such as materials, use of
materials, and modifications.
 Use of materials section outlines how the recipient can and cannot use the materials,
including any restrictions or prohibitions.
 Confidential information section protects proprietary or sensitive information shared
in the MTA, specifying what is considered confidential and how it should be treated.
 Intellectual property (IP) section addresses matters related to inventions, patents, and
licensing rights. Negotiating IP language can be challenging.
 Warranties section states that the material is provided without any warranties or
guarantees.
 Liability and indemnification section holds the recipient responsible for any damages
arising from the use, storage, or disposal of the material, while some MTAs may
make the provider liable for their negligence.
 Publications section allows the recipient to publish or present research results without
seeking approval from the provider, but may require the provider to review and
comment on proposed publications.
 Governing law section specifies the jurisdiction that will govern the MTA, although it
is common for parties to be silent on this matter.
  Termination section sets an expiration date for the agreement and outlines the process
for early termination, return or destruction of materials, and the survival of certain
obligations.
 Signatures section includes the signatures of authorized officials and researchers
involved in the MTA.
 Exhibits or appendices can be attached to the MTA, providing additional details such
as research protocols or lists of materials.

Material Transfer between Universities

 Material transfer between universities is generally easier compared to transfers
between industry and academia because the institutions have similar cultures and
motivations.
 In the United States, universities readily share materials for academic research
purposes with minimal restrictions.
 Common agreements used for these transfers include the NIH-facilitated UBMTA and
the NIH's Simple Letter Agreement.
 The UBMTA has a narrow definition of the material transferred and does not grant
extensive rights to the provider beyond the original material, progeny, and unmodified
derivatives.
 Problems in transfers between academic institutions usually arise when the material
has an exclusive license that imposes constraints on the providing institution.
 However, such issues can be avoided if the exclusive license reserves the right to use
the materials for internal research and transfer them to other academic institutions.
 The University of California, for instance, includes a clause in its exclusive license
agreements that allows educational and nonprofit institutions to use the invention and
associated technology for educational and research purposes

Material Transfer from Private Companies to Universities

 Material transfers between private companies and universities are usually more
complex and prone to difficulties compared to transfers between universities.
 Universities face challenges in preserving academic principles, avoiding unfunded
financial obligations, and preventing conflicting legal obligations with third parties.
 The ability to freely publish research results is a fundamental principle for
universities, but material transfer agreements (MTAs) can impose restrictions on
publication.
 Universities aim to use their own research results in future studies, but some material
providers may claim ownership of the results, hindering follow-on research.
 Conflicting legal obligations can arise when different sources provide the material and
fund the research, potentially violating IP obligations.
 Universities have an obligation to make their innovations available to the public, but
MTAs requiring nonexclusive, royalty-free licenses to inventions can impede
commercialization and hinder public benefit.
 Fair consideration is important to universities, and they often seek financial returns
for commercial use of their research results, while also avoiding indirect support of
private companies using public funds.
 Resolving these complexities requires time and negotiation, but finding solutions that
satisfy all parties' needs is possible by prioritizing research progress and finding
common interests.
 Research Collaboration Agreement
 A collaborative research agreement consists of five main parts: objectives, work
description, general provisions, budget, and list of materials.
 Each part of the agreement is important, but extra attention should be given to
defining objectives, work plan, and procedures for making changes to the plan.
 The goal of the agreement is to establish clear rules and mutual benefits for both
parties involved in the collaboration.
 A well-written agreement strengthens the relationship and understanding between
researchers and managers, while a poorly written one can cause conflicts.
 The agreement sets the foundation for research results to be commercialized.

Parts of an Agreement
 Collaborative research agreements usually consist of five parts: statement of
objectives, statement of work, general provisions, budget, and list of materials.
 The agreement should cover each of these points, although the names used for the
parts can vary.
 The statement of objectives describes the purpose of the agreement and why the
collaboration is important.
 The statement of work explains the research that will be conducted, including the
approaches and methodologies, responsibilities of each party, and deadlines.
 The general provisions section includes important details, collaboration mechanisms,
and rules for conducting the collaboration.
 The budget part outlines the resources needed and contributed by each party for the
research project.
 If the agreement involves the transfer of materials, there may be an additional section
called the list of materials.
 The list of materials provides a record of the items transferred, including names,
quantities, and dates.
 The statement of objectives should be concise, using language that is easily
understandable, and clearly explaining the real-world issues the collaboration aims to
address.
 The statement of work is crucial and should include scientific objectives,
methodologies, responsibilities of each partner, and benchmarks for completion.
 It is important for the collaborating researchers to work closely together in drafting
the statement of work.
 The statement of work should be broken down into subsections, clearly specifying the
tasks and responsibilities of each partner.
 Quantifying the work and providing general guidance on size and scope can help
avoid misunderstandings.
 Time frames and benchmarks should be included to ensure orderly progress and
measurement of work completion.
 The length of a collaborative research agreement can vary, but the statement of work
should be as long as necessary to ensure clarity, typically a few pages in length.

General Provisions
 General provisions are an important part of a collaborative research agreement.
 They provide guidance on how the collaboration will work and cover various aspects
of the partnership.
 Standardized general provisions can serve as a starting point for negotiations.
  The agreement should be user-friendly and avoid unnecessary complications.
Publications:
 Public disclosure is crucial in research agreements.
 It includes various forms of sharing research results.
 Limitations on public disclosure may be necessary to protect patent applications.
 Both parties should have the right to review and comment on each other's public
disclosure.
 The agreement should clearly state any limitations on public disclosures.
Confidentiality:
 Confidential information should be handled carefully in the agreement.
 There are two types of confidential information: pre-existing and generated during the
project.
 Time limits for keeping information confidential should be specified.
 Previous confidentiality agreements may be referenced or replaced by the research
agreement.
 Confidential information is closely tied to intellectual property and tangible property.
Intellectual Property:
 Intellectual property (IP) and tangible property (TP) provisions are crucial in
collaborative research agreements.
 IP rights include patents, copyrights, trade secrets, trademarks, etc.
 TP rights include ownership of physical materials and resources.
 Ownership of pre-existing IP/TP should be determined and listed in the agreement.
 Ownership of new IP/TP discovered during the project should be addressed.
 Ownership may depend on the laws of the country and inventorship rules.
 The agreement should specify the grant of licensing rights and the scope of the grant.
Amendments:
 Agreements may need amendments as partnerships evolve.
 Amendments should be in writing and signed by the proper authorities.
 Informal amendments can lead to disputes, so all changes should be documented.
Termination:
 Agreements should have a specific end date.
 Termination clauses can stipulate conditions and procedures for ending the
agreement.
 The end date can be extended through the amendment process if both parties agree.

Budget
 The budget section is an important part of a collaborative research agreement.
 The focus should not solely be on funding, as collaboration involves more than just
raising revenue.
 The budget should start with a clear statement of work to determine the resources
needed for the project.
 Consideration should be given to staff time, tangible resources, and in-kind
contributions.
 In-kind contributions from collaborating partners should be noted in the budget.
 The budget should be separate from any licensing revenue projections.
 The budget should specify payment schedules and the provision of in-kind resources.

List of Materials
  The list of materials is an important part of a collaborative research agreement.
 It lists the tangible properties (TP) that each party contributes to the project.
 These materials were developed outside of the project and are owned by one partner
or the other.
 The list may include items with intellectual property (IP) rights or without.
 In collaborative research, the list may need to be updated regularly to meet the
researchers' needs.
 A well-written agreement allows for easy amendments to the list of material

MODULE 4
Trade Secret and confidential information
https://www.icsi.edu/media/webmodules/CRCPP_IPRL%26P_2018_DEC_30.pdf

What is confidential information? What are the remedies available in case of breach of
confidentiality in regard to confidential information? Discuss the content and role of non-
disclosure agreements for the protection of confidential information.

Trade Secret
 Trade secret law protects information that is not widely known in a particular
industry.
 It stops others from using or benefiting from that information without permission.
 The goal is to encourage research and development by safeguarding important
business information.
 To qualify as a trade secret, the information must be unknown to others.
 The secret information should have commercial value, meaning it can be used to
make money.
 Steps should be taken to keep the information confidential.
 Examples of trade secrets include formulas, patterns, methods, or techniques that have
economic value because they are not publicly known.
 Trade secrets can be considered a type of intellectual property, meaning they can be
bought or licensed to others.

Essentials of a Trade Secret

 It should have commercial value as it is a secret
 It should not be widely known except to a limited group of persons related to the
business
 To keep the information secret, the owner has taken reasonable steps.

It includes formulas, recipes, processes, software codes, customer lists, supply channels,
financial information, etc. Some famous examples of trade secrets are Nestle Maggi Masala,
KFC’s chicken, Listerine MouthWash, Hershey’s Milk Chocolate, Google Algorithm, Coca-
Cola, and many more on the list.

Trade Secret Protections in India

 In 1985, the United States became the first country to legally protect trade secrets
through the Uniform Trade Secrets Act.
  In India, there is no single law specifically protecting trade secrets and confidential
information. Instead, different laws have provisions to protect them.
 Indian courts have recognized trade secret protection based on fairness and common
law principles, like breach of confidence and breach of contract.
 Section 272 of the Contract Act, 1872, ensures that employment agreements protect a
company's confidential information while allowing employees to work in their chosen
profession.
 It's important for businesses to include restrictive clauses in employment contracts to
safeguard their trade secrets.
 In the case of Richard Brady v. Chemical Process Equipment Pvt. Ltd., the Delhi
High Court granted an injunction to protect trade secrets even without a contract.
 Restrictive covenants, such as non-compete, non-solicitation, non-poaching, and
confidentiality clauses, are examples of measures to protect trade secrets.
 The courts have recognized that client information stored in databases can be
protected under the Copyright Act, 1957, indirectly safeguarding trade secrets and
confidential information.
 Other statutes, such as the Information Technology Act, 2000, the Indian Penal Code,
the Securities Exchange Board of India Act, 1992, and the Code of Civil Procedure,
also indirectly include provisions for trade secrets protection.
 These statutes provide compensation, criminal liability, and safeguards for
maintaining confidentiality and trust.
 The Securities and Exchange Board of India Act, 1992, penalizes the use and
disclosure of sensitive information by insiders.

Licensing Trade Secrets in India

 A trade secret license is a confidential agreement where the owner of a trade secret
allows someone else to use it.
 The owner still keeps full ownership of the trade secret.
 The purpose of the license is for the owner to earn money through royalties from the
trade secret.
 Before finalizing the agreement, sensitive information needs to be shared, so non-
disclosure agreements (NDA) are used to protect the trade secret.
 The NDA specifies how the confidential information can be used and when it can be
shared with others.
 The NDA is a legal tool used before licensing negotiations to maintain the secrecy of
the disclosed information.
 Misappropriation is when someone wrongfully acquires a trade secret through theft,
fraud, or other dishonest or illegal means.
 Examples of misappropriation include industrial espionage, which is stealing trade
secrets to gain a competitive advantage, and insider trading, which is illegal trading
based on confidential information.
 Companies engage in industrial espionage to save time and money by stealing
valuable information instead of developing it themselves.
 Insider trading has been prevalent in India with the formation of the Bombay Stock
Exchange, and it involves using confidential information to make illegal profits in the
stock market.
 Before the Securities Exchange Board of India (SEBI) was established, insider trading
was regulated by the Companies Act, which had provisions to prevent it.
 Confidential Information
 Confidential information refers to valuable information that is kept secret and gives a
business an advantage.
 To be considered confidential, the information must have value because it is not
known to others and can be legally protected.
 The terms "confidential information" and "trade secrets" mean the same thing.
 It can also include privileged or classified information that needs to be kept hidden.
 In a legal case, it was mentioned that while confidential information may not be
legally considered "property," it is often treated as a part of intellectual property.
 It is the information disclosed by one party to the other party in the course of business
and it shall not be discussed to the public.
 The concept is based upon the doctrine of law of confidence and equitable principle
i.e, the person who has received the information must not use it for unfair advantage
to the detriment of the person who provided the information without their consent.

Remedies available in case of breach

The remedies available to the owners of trade secrets are:

 an injunction preventing a licensee, employee, vendor or other party from disclosing a

trade secret;
 the return of all confidential and proprietary information; and
 compensation for any losses suffered due to the disclosure of trade secrets.

Role of NDA for protection of Confidential Information

Sound and concise company policies and nondisclosure agreements with the employees
protecting confidential information and trade secrets are recommended so as to provide
contractual remedy in addition to the one under the common law.
Such agreements should define “confidential information” and the exceptions to
confidentiality. Agreements should have clauses negating a grant of an implied license,
restrictions on disclosure, use and copy; restriction on use of confidential information upon
termination of the employment, return of information upon termination and right to withhold
salary and emoluments till such return. Non-compete clauses, depending upon their
applicability in the Indian context, read with the confidentiality clauses would afford an
organization added protection with respect to its confidential information. Such provisions
must have a clear purpose, which is to restrict the use of confidential information and trade
secrets obtained during employment and ensure that employees do not compete unfairly.
However, non-compete provisions would need to be reasonable, and the Indian courts may
treat a tough non-compete provision as unenforceable. In order to ensure that the rights of
third parties are not violated, the non-disclosure/employment agreement should clearly
impose an obligation on the employee not to integrate into the organization’s data or
intellectual property, any confidential information of a third party. Employees should be
required to indemnify the organization in case of violation of this clause. If the organization
has not executed such agreements at the time of employment, subsequently executed
agreements should expressly cover the confidential information obtained by the employee
from the date of his employment.
 MODULE 5
Enforcement of IP & Dispute Resolution
5.1 Common Issues and international issues
5.2 ADR
5.3 Litigation
5.4 Dispute Settlement Mechanism under WTO

Role of ADR mechanism resolving in IP disputes. Support your answer with cases and the
role played by WIPO Arbitration and Mediation Centre.

Common Issues
Enforcing intellectual property (IP) rights can sometimes face challenges. Here are some
common issues that may arise:
 Difficulty in proving infringement: It can be challenging to gather evidence and
demonstrate that someone has violated your IP rights. This may require thorough
investigation and documentation to build a strong case.
 Costly legal procedures: Taking legal action to enforce IP rights can be expensive.
Lawsuits, attorney fees, and other associated costs can put a strain on the
organization's resources. This financial burden may deter some organizations from
pursuing enforcement.
 Jurisdictional issues: IP infringement can occur across borders, making it complex to
enforce rights in different countries with varying legal systems. Organizations may
need to navigate international laws and seek assistance from local authorities or legal
experts.
  Time-consuming process: Enforcing IP rights often involves a lengthy legal process,
including filing complaints, gathering evidence, and going through court proceedings.
This can result in significant delays before achieving a resolution.

Assessing the impact of alleged infringement on an organization is crucial.

 Retaining competitive edge: IP infringement can give competitors access to your
innovative ideas or unique products/services, eroding your competitive advantage. By
addressing infringement, you can protect your organization's distinctive qualities and
maintain a strong market position.
 Protecting value: Intellectual property assets, such as patents, trademarks, or
copyrights, contribute to the value of your organization. Infringement can diminish
this value by allowing others to profit from your ideas without permission.
Enforcement helps safeguard the worth and potential revenue derived from your IP.
 Safeguarding reputation: IP infringement can harm your organization's reputation if
others misuse your brand, content, or inventions. Taking action against infringers
sends a message that you protect your IP rights, reinforcing your credibility and
maintaining trust among customers and partners.

The nature of IP determines the actions taken against infringement. Different types of IP
require specific approaches:
 Patents: If your invention is protected by a patent, infringement may lead to legal
action to preserve your exclusive rights and prevent competitors from using your
technology or processes without permission.
 Trademarks: Infringement of your brand's trademark can confuse consumers and
dilute your brand's distinctiveness. Taking action against trademark infringement
helps protect your brand value and ensures that customers can identify your products
or services.
 Copyrights: If someone copies or uses your creative works without permission,
enforcing copyright protection can prevent unauthorized distribution and help
maintain control over your original content.
 Trade Secrets: Misappropriation of your trade secrets, such as confidential business
information or formulas, can harm your competitive edge. Enforcing trade secret
protection involves legal measures to prevent unauthorized access and use of your
valuable proprietary information.

International Issues
Enforcing intellectual property (IP) rights in international markets can be challenging due to
various factors
1. Infringement in an overseas market: When IP is infringed in a foreign country,
enforcing your rights in that specific territory becomes necessary. This can involve
navigating the legal systems and processes of that country to take action against the
infringers.
2. Litigation in foreign jurisdiction: Engaging in legal proceedings for IP enforcement
in a foreign jurisdiction can be time-consuming and complex. Different legal systems,
laws, and court procedures may require substantial effort and resources to navigate
effectively.
3. Challenges in enforcement proceedings: Several obstacles can arise when enforcing
IP rights internationally:
  Language barriers: Communication and understanding can be hindered when
dealing with legal matters in a foreign language. Translation services or legal
experts familiar with both languages may be required.
 Limited foreign IP knowledge: Organizations may have limited understanding
of the IP laws and regulations specific to a foreign country. This lack of
knowledge can make it difficult to strategize and navigate the enforcement
process effectively.
 Need for local advice: Seeking guidance from local legal experts or IP
professionals becomes essential to understand the intricacies of the foreign
jurisdiction and ensure compliance with local laws and regulations.
 Differences in foreign IP systems : Each country has its own IP laws and
systems, which may differ significantly from those in your home country.
Adapting to and understanding these differences can present challenges during
the enforcement process.
 Unfamiliar business climate: Operating in a foreign market brings unfamiliar
business practices, cultural norms, and commercial environments. This
unfamiliarity can affect the way IP enforcement strategies are developed and
implemented.
 Weak IP enforcement regimes: Some countries may have less robust or
effective IP enforcement mechanisms, making it more challenging to protect
your rights and take action against infringers.
Navigating these international issues requires careful planning, collaboration with local
experts, and a comprehensive understanding of the legal and business landscapes of the
foreign jurisdiction. It is crucial to be prepared for the complexities and potential obstacles
that may arise during the enforcement of IP rights in international markets.

Enforcing IP
Important to seek Legal Advice and Assistance from a lawyer. Following are the ways to
enforce the organisation's IP rights-
 Letter of demand: A letter of demand, also known as a cease and desist letter, is a
formal communication sent to the infringing party. It outlines your rights, the alleged
infringement, and demands that they stop the infringing activity. This initial step aims
to resolve the issue without resorting to litigation, often providing the infringer with
an opportunity to comply and avoid further legal action.
 Breach of contract: If the infringing party is a contractual counterparty, you can
pursue a breach of contract claim. This occurs when the infringer violates the terms of
a licensing or distribution agreement, for example. Enforcing your rights through a
breach of contract claim can involve legal action seeking remedies such as damages
or termination of the contract.
 Litigation: In cases where other enforcement methods fail or are not feasible,
litigation may be necessary. Litigation involves filing a lawsuit against the infringing
party in a court of law. This legal process typically includes gathering evidence,
presenting arguments, and seeking remedies such as injunctions to stop the
infringement and damages for any harm caused. Litigation can be time-consuming,
costly, and complex, requiring the expertise of an IP lawyer.
 Alternative Dispute Resolution (ADR): ADR methods, such as mediation or
arbitration, provide alternatives to traditional litigation. These processes aim to
resolve disputes outside of the courtroom through negotiation and facilitated
discussions. Mediation involves a neutral third party helping the parties reach a
 voluntary agreement, while arbitration involves a neutral arbitrator who decides the
outcome based on presented evidence. ADR methods can be more efficient and cost-
effective than litigation, offering a more collaborative approach to resolving IP
disputes.

Cease and Desist Letter

1. Notice of infringement: The letter is sent to someone who is using proprietary
information without permission from the owner. It informs them that they are
infringing on the owner's intellectual property rights.
2. Warning of legal action: The letter warns the recipient that if they don't stop using
the intellectual property, they may face a lawsuit.
3. Time to respond: The infringing party is given a specific period to respond to the
letter. During this time, they can either claim that they have stopped using the
intellectual property or defend their right to use it.
4. Resolution or defense: The recipient can respond by either confirming that they have
ceased using the intellectual property or by presenting their arguments to justify their
use.

Meaning of ADR
 Alternative Dispute Resolution (ADR) means resolving disputes with more informal
and speedy manner.
 The ADR has received widespread acceptance in both developed and developing
countries. Informal methods, cost effectiveness and being less time-consuming has
made ADR the first preference among the parties.
 An Alternative Dispute Resolution method includes arbitration, mediation,
negotiation, and conciliation.
 CASES

US v. India at WTO on implementation of TRIPS

Introduction
In this case, the United States raises a complaint against India regarding the alleged absence
of patent protection for pharmaceutical and agricultural chemical products, in violation of
several articles of the Agreement on Trade-Related Aspects of Intellectual Property Rights
(TRIPS).

Consultations
Complaint by the United States
On 2 July 1996, the United States initiated consultations with India, claiming violations of
TRIPS Agreement Articles 27, 65, and 70, related to the absence of patent protection for
pharmaceutical and agricultural chemical products in India.

Measure and Intellectual Property at Issue

 Measure at Issue
o India's "Mailbox Rule" - Under this rule, patent applications for
pharmaceutical and agricultural chemical products could be filed.
o Mechanism for Granting Exclusive Marketing Rights: India's mechanism for
granting exclusive marketing rights to pharmaceutical and agricultural
chemical products.
 Intellectual Property at Issue: Patent protection for pharmaceutical and agricultural
chemical products, as provided under TRIPS Article 27.
Summary of Key Panel/AB Findings
1. TRIPS Article 70.8 (Filing of Patent Application)
 The Appellate Body upheld the Panel's finding that India's filing system, based on
"administrative practice," for patent applications for pharmaceutical and
agricultural chemical products was inconsistent with Article 70.8.
 The system failed to provide secure means for filing patent applications within the
meaning of Article 70.8(a) because applications filed under administrative
instructions could be rejected by the court under contradictory mandatory
provisions of the existing Indian laws.
2. TRIPS Article 70.9 (Exclusive Marketing Rights)
 The Appellate Body agreed with the Panel that India lacked a mechanism for
granting exclusive marketing rights for the products covered by Article 70.8(a),
thereby violating Article 70.9.

Other Issues
Interpretation of the TRIPS Agreement
 The Appellate Body rejected the Panel's use of the "legitimate expectations"
standard as a principle of interpretation for the TRIPS Agreement.
 The Appellate Body based its conclusion on the lack of historical usage of
"legitimate expectations" as a principle of interpretation in GATT practice.
 Additionally, the Appellate Body emphasized that treaty interpretation should not
involve imputing words or concepts not intended by the treaty parties.

Panel and Appellate Body Proceedings

1. Establishment of Panel
 The Dispute Settlement Body (DSB) established a panel on 20 November 1996,
and the European Community reserved their third-party rights.
 On 29 January 1997, the Panel was composed, and its report was circulated on 5
September 1997.
 The Panel found India non-compliant with TRIPS Articles 70.8(a), 63(1), 63(2),
and 70.9.
2. Appellate Body Proceedings
 On 15 October 1997, India appealed certain issues of law and legal interpretations
developed by the Panel.
 The Appellate Body's report, which upheld the Panel's findings on Articles 70.8
and 70.9 with modifications, was circulated to Members on 19 December 1997.
 The DSB adopted both the Appellate Body report and the Panel report, as
modified by the Appellate Body, on 16 January 1998.

Basmati Rice Case

Turmeric Case
Introduction
Turmeric, a plant traditionally used in India for its medicinal properties, gained international
attention due to a U.S. patent granted on its use in wound healing. The patent raised questions
about the granting of exclusive rights for something widely known and used. The Centre for
Scientific and Industrial Research (CSIR) in India challenged the patent's validity.

Patent and Issue

Patent Details
 U.S. Patent 5,401,504 was granted in 1995 to two U.S.-based Indians and assigned to
the University of Mississippi Medical Centre.
 The patent claimed the use of turmeric for promoting wound healing, both topically
and orally.
Challenge and Evidence
 CSIR filed for re-examination of the patent at the United States Patent and Trademark
Office (USPTO).
 The challenge required finding evidence in published sources that established the
prior knowledge and use of turmeric for wound healing.
 Despite turmeric's widespread use in Indian households, finding published evidence
was challenging.
 Eventually, 32 references, including ancient Sanskrit, Urdu, and Hindi writings, were
located.

Patent Revocation and Analysis

Patent Revocation
 In 1997, the USPTO revoked the patent, considering the claims as obvious and
anticipated.
 The use of turmeric for wound healing was deemed an old practice.
Ramifications and Concerns
 This case raised concerns about biopiracy and its impact on traditional indigenous
knowledge and biodiversity.
 Developing countries, including India, feared the negative consequences of
intellectual property rights under the WTO's TRIPS agreement.
 The globalization of intellectual property rights threatened traditional knowledge and
economic well-being.

Potential Solutions and Reforms

Geographic Indications (GI)
 Countries could seek protection for indigenous products and processes through
geographic indications.
 Geographic indications identify goods originating in a specific territory and attribute
specific qualities or characteristics to their geographic origin.
 Developing countries, including India, started constructing databases of indigenous
knowledge for protection against biopiracy.
Call for Reform
 The TRIPS agreement faced calls for reform from developing countries concerned
about biopiracy.
 Some advocated for the retreat of the WTO from intellectual property rights
enforcement.
 Reform proponents believed it was the WTO's responsibility to protect indigenous
knowledge from foreign patents and ensure accessible dispute resolution.
 Scientists and academics in India criticized the WTO's intellectual property rights
enforcement.
Conclusion
The Turmeric Case highlighted the challenges posed by biopiracy and the need to protect
traditional indigenous knowledge. Developing countries, including India, sought reforms
within the TRIPS agreement and explored options like geographic indications to safeguard
their biodiversity and economic interests. The case shed light on the importance of addressing
biopiracy and the protection of traditional knowledge at the international level.

Diamond v. Chakraborty
Introduction
Ananda Mohan Chakrabarty, a genetic engineer, developed a genetically modified bacterium
capable of breaking down crude oil, which held significant value for treating oil spills. He
filed a patent application in 1972, asserting claims related to his invention. However, the
patent examiner rejected claims for the bacteria, stating that micro-organisms are "products of
nature" and not patentable subject matter.

Patent Claims and Rejection

Chakrabarty's Patent Claims
 Process claims for the method of producing the bacteria.
 Claims for an inoculum comprised of a carrier material and the new bacteria.
 Claims to the bacteria themselves.
Examiner's Rejection
 Micro-organisms were considered "products of nature" and ineligible for patent
protection.
 Living things were deemed not patentable subject matter.
Appeals and Legal Proceedings
Appeal to the Board of Appeals
 Chakrabarty appealed the rejection of his claims to the Patent Office Board of
Appeals.
 The Board affirmed the Examiner's decision based on the living nature of the micro-
organisms.
Court of Customs and Patent Appeals
 The United States Court of Customs and Patent Appeals overturned the decision in
favor of Chakrabarty.
 They argued that the fact that micro-organisms are alive is irrelevant to patent law.

Supreme Court Decision

Supreme Court Case and Ruling
 The case was argued on March 17, 1980, and decided on June 16, 1980.
 The Supreme Court ruled in favor of Chakrabarty, upholding the patent's validity.
 The Court held that a live, human-made micro-organism qualifies as patentable
subject matter under Title 35 U.S.C. § 101.
Interpretation of Patent Law
 The Court defined "manufacture" as the production of articles with new forms,
qualities, properties, or combinations.
 "Composition of matter" was interpreted to include all compositions of two or more
substances.
  Section 101 allows for patents on new and useful processes, machines, manufactures,
or compositions of matter.

Implications and Significance

Limits and Exceptions
 The Court acknowledged that Section 101 has limits and does not cover every
discovery.
 Laws of nature, physical phenomena, and abstract ideas are not patentable.
Patenting Living Organisms
 The USPTO argued against patenting living organisms, citing public policy concerns.
 The Court held that the determination of patentability should be left to the judiciary.
 The engineered oil-eating bacterium was deemed patentable subject matter.
Impact on Biological Research
 Granting a patent for the engineered microorganism revolutionized the field of
biological research.
 The patent conferred product status on the microorganism, recognizing its unique
characteristics and potential utility.

Conclusion
In summary, the Diamond v. Chakrabarty case established that genetically modified
microorganisms could be patented, as they were considered human-made and distinct from
naturally occurring organisms. This ruling had significant implications for the field of
biotechnology and set a precedent for the patentability of living organisms.

Harvard Oncomouse Case

Introduction
The Harvard Oncomouse case explores the ethical implications of patenting transgenic
animals, specifically focusing on the development and patentability of the genetically
modified oncomouse. Transgenic animals, which have DNA from other species artificially
introduced into their genome, raise numerous ethical concerns, sparking debates in the field
of bioethics.

The Oncomouse Creation

Research and Genetic Modification
 In the early 1980s, researchers at Harvard Medical School developed a genetically
modified mouse highly susceptible to cancer.
 They introduced an oncogene capable of triggering tumor growth, intending to
advance cancer research.
 Harvard College sought patent protection for the oncomouse in the United States and
other countries.
Key Ethical Issues for the Patent System
 Should patents be granted for animals or animal varieties, particularly higher-order
animals like mammals?
 How should moral implications, such as the suffering caused to transgenic animals, be
addressed in specific cases?

Patent Decisions in Different Jurisdictions

United States - Patent Granted
 In 1988, the United States Patent Office granted Harvard College patent no. 4,736,866
for the transgenic non-human mammal containing the recombinant activated
oncogene sequence.
 The patent explicitly excluded humans, reflecting concerns about patents on human
beings and modification of the human genome.
European Patent Office (EPO) - Utilitarian Balancing Test
 The EPO addressed the oncomouse case based on provisions in the European Patent
Convention.
 The EPO concluded that patenting animal varieties did not prohibit patenting animals
in general.
 They developed a utilitarian balancing test, weighing potential benefits (medical
research) against negative aspects (suffering of the oncomice).
 The EPO determined that the oncomouse's usefulness in cancer research outweighed
moral concerns about animal suffering.
Upjohn Mouse - Similar Approach, Different Outcome
 In the Upjohn case (1992), the EPO applied the same utilitarian approach but
concluded that the exploitation of a transgenic mouse causing hair loss was contrary
to morality and not patentable.
Canada - Patent Rejected
 Initially, the Canadian patent examiner rejected claims for transgenic animals, but
allowed claims for the process of obtaining the oncomouse.
 The Supreme Court of Canada ruled in 2002 that higher life forms, including
mammals, were not patentable.
 The court recommended public debate to address the complex social and moral issues
related to patentability of such life forms.

Different Approaches and Ethical Considerations

Patentability and Ethical Questions
 The oncomouse case demonstrates the varied approaches jurisdictions have taken in
determining patentability of transgenic animals.
 It highlights the fundamental question of whether transgenic animals meeting
patentability criteria should be considered patentable subject matter.
 Ethical dimensions and the potential for suffering in specific cases are also weighed
differently.
Bioethics and the Patent System
 Transgenic animals pose broader bioethical questions beyond patentability.
 The case emphasizes the need for considering the ethical implications of specific
technologies within the patent system.

In summary, the Harvard Oncomouse case delves into the complex relationship between
patentability and ethics in the context of transgenic animals. The decisions reached by
different jurisdictions highlight the divergent approaches taken to address the patentability
and ethical dimensions of such technological advancements.

Natco v. Bayer
Introduction
The case of NATCO v. Bayer revolves around Natco Pharma Ltd., an Indian generic drug
manufacturer, applying for a compulsory license for Bayer's patent covering the anticancer
drug Sorafenib Tosylate. The decision, made by the Controller of Patents, marked a
significant milestone in the Indian pharmaceutical industry.

Background
Natco's Application for Compulsory License
Natco Pharma sought a compulsory license from the Controller of Patents to produce and
market the anticancer drug Sorafenib Tosylate, as Bayer's patent restricted its availability to a
limited number of patients. Natco argued that the drug's reasonable requirements were not
being satisfied and that it was not available at an affordable price.

Key Points of Contention

 Unsatisfied Public Requirements: Bayer supplied the drug to only 2% of the patients
who needed it, failing to meet the reasonable requirements of the public for the
patented drug.
 Unaffordable Pricing: Bayer priced the drug at an exorbitant rate of Rs. 2.8 lakh per
month's supply, while Natco proposed to sell the same quantity for Rs. 8,800 per
month.
 Inadequate Working of the Patent: Bayer did not manufacture sufficient quantities of
the drug in India, failing to fulfill the "working" requirement under the Indian Patents
Act. Additionally, the drug was only available in select states of India, further limiting
its accessibility.

Controller's Decision
The Controller of Patents, Mr. P.H. Kurian, granted Natco Pharma the country's first
compulsory license for the production and marketing of the anti-cancer drug. The decision
was based on satisfying the requirements outlined in Section 84(1) of the Patents Act, 1970.

Terms and Conditions of the Compulsory License:

The Controller specified the following terms and conditions for the compulsory license
granted to Natco Pharma:
 Selling the drug at a maximum price of Rs. 8,880 for a pack of 120 tablets.
 Maintaining and disclosing quarterly accounts to the Controller.
 Prohibiting outsourcing of drug production.
 Non-exclusive and non-assignable license.
 Payment of a 6% royalty rate.
 Limited to the treatment of liver and renal cancer in humans within India.
 Providing free drugs to at least 600 needy and deserving patients annually.
 No sublicensing allowed.
 No right to import the drug.
 Valid for the remaining term of the patent.
 Distinct product appearance and no association with Bayer's product.
 Bayer not liable for any product-related matters.

Implications of the Landmark Decision

The Controller's decision to grant the compulsory license will have significant consequences,
making the treatment more affordable and accessible to a broader population in India. This
decision marks an important milestone in the Indian pharmaceutical industry and sets a
precedent for future cases involving compulsory licenses.

Conclusion
The NATCO v. Bayer case resulted in a landmark decision, granting a compulsory license for
the production and marketing of an anticancer drug. The Controller's decision was based on
the unsatisfied public requirements, unaffordable pricing, and inadequate working of the
patent by Bayer. The terms and conditions of the license ensured affordability, accountability,
and accessibility of the drug, benefiting the community as a whole.

Novartis v. Union of India

Introduction
This case involves a legal battle between Novartis AG, a Swiss pharmaceutical company, and
the Union of India. The dispute revolves around Novartis' patent application for the beta
crystalline form of Imatinib Mesylate, a therapeutic drug used to treat chronic myeloid
leukemia and certain tumors. The central issue is whether this form of Imatinib Mesylate
qualifies as an invention under the Indian Patents Act, 1970, and is eligible for patent
protection.

Provisions Involved
The case revolves around the interpretation of the following provisions of the Indian Patents
Act, 1970:
 Section 2(1)(j) defines "invention" as a new product or process involving an inventive
step and capable of industrial application.
 Section 2(1)(ja) defines "inventive step" as a feature of an invention that involves
technical advance as compared to existing knowledge or has economic significance or
both.
 Section 3(d) states that certain substances or uses shall not be considered inventions
unless they result in enhanced efficacy.

Facts in Brief
Novartis filed a patent application for the beta crystalline form of Imatinib Mesylate in 1998.
After facing pre-grant oppositions, the Assistant Controller of Patents and Designs rejected
Novartis' application, citing lack of novelty, obviousness, and non-compliance with Section
3(d). Novartis challenged this decision before the Madras High Court and filed writ petitions
questioning the constitutionality of Section 3(d). The case was subsequently transferred to the
Intellectual Property Appellate Board (IPAB). The IPAB upheld the rejection of Novartis'
patent application, stating that Section 3(d) affected its patentability.

Issues:
 Interpretation of Section 3(d): What is the true meaning and scope of Section 3(d) of
the Patents Act?
 Interplay between Sections 2(1)(j), 2(1)(ja), and 3(d): How does Section 3(d) interact
with the definitions of "invention" and "inventive step" in Sections 2(1)(j) and 2(1)
(ja)?
 Patentability of the beta crystalline form: Does Novartis' product qualify as a "new
product" with an inventive step and non-obviousness?
 Impact of Section 3(d) on patentability: Can Novartis' patentability be denied based
on Section 3(d) even if it meets the criteria under Sections 2(1)(j) and 2(1)(ja)?
Decision of the Court
The Supreme Court held that the beta crystalline form of Imatinib Mesylate did not qualify as
an invention as it was obvious from prior publications. Additionally, the Court determined
that this form fell within the scope of Section 3(d) of the Patents Act, which excludes certain
substances from patentability unless they enhance efficacy. The Court interpreted "efficacy"
to refer to therapeutic efficacy in this context. Consequently, the Court ruled that Novartis'
product failed both the invention and patentability tests under Sections 2(1)(j), 2(1)(ja), and
3(d).

Conclusion
This landmark decision addressed the contentious issue of drug affordability and
patentability. The ruling garnered significant attention globally and elicited diverse responses.