intellectual property considerations in the outsourcing business

7/28/2019 Intellectual Property Considerations in the Outsourcing Business

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Intellectual Property ConsiderationsIn The

Outsourcing Business

By Poorvi Chothani, Esq.

Mumbai


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Overview

Member of the World Trade Organization(WTO)

Trade Related Aspects of Intellectual Property

Rights TRIPS Compliant Berne Convention

Paris Convention

Universal Copyright Convention Patent Cooperative Treaty


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Some Relevant Indian IP Laws

The Copyright Act, 1957 and the Copyright Rules 1958

The Patents Act, 1970 and the Patents Rules, 2003

The Trademarks Act, 1999 and the Trademarks Rules, 2000

The Biological Diversity Act, 2002

The Geographical Indication of Goods (Registration and Protection)

Act, 1999

The Designs Act, 2000and the Designs Rules, 2001


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Significant Provisions

Inalienable moral rights Waiver Concept does not apply to computer software

Work For Hire

Compulsory Licensing

Version Recordings

Broad fair use exceptions Non-commercial personal use deemed as fair use and does not

constitute infringement.


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Significant Provisions

Patents Joint Owners

Consent Accounting Rights

Infringement Responsibilities

Computer Programs andbusiness methodsper se not

patentable Protect Computer Programs

as trade secrets

Controller of Patents

First to File vs. First toInvent

Compulsory License

Research andExperimental Use


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Assignment of IP Rights

Of Copyright

Territory

Term

Lapse Consent

Of Patents

Joint Owner Needs Consent of other owner (s) toassign rights

Valid only if in writing and registered in India


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Indian Patent Applications

Patent Applications for:

inventions originating in India; or

involving an Indian resident inventor

must first be filed in India, unless a foreign filing

license has been granted by the Indian PatentOffice


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Patents - Some Special Provisions

Compulsory licenses for export of medicines to countrieswhich have lack of infrastructural or production capacityfor meeting public health emergencies.

In case of Infringement - Only civil remedy of injunction,damages, and accounts for profits.


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Data Privacy and Protection

No Specific Statute

Existing legislation provides limited protection

Information Technology Act - limited protection againstcertain types of data misuse or computer offencesinvolving unauthorized access to data on computers andnetworks

E.g. hacking, damage to computer source code, virus introduction

Civil and criminal remedies available


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Legal framework for Data Privacy

The Constitution of India

The Information Technology Act, 2000 Protects against computer offences Provides for both civil and criminal remedies

The Specific Relief Act, 1963 To enforce specific performance provisions in the contract against the

Indian service provider

The Indian Penal Code, 1860 and The Indian CriminalProcedure Code of 1973

(corporeal property) To prosecute incidents of theft and criminal breach of trust and fraud


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Legislative Action

Amendment to the Information Technology Actof 2000:

Negligence in implementing and maintaining

reasonable security practices damages payableINR 1 Crore (approximately US$ 243,902 at USD1 =INR 41)

Disclosing personal data without the data subjects

consent - damages are limited to INR 25 lakhs(approximately US$ 60,976 at USD1 = INR 41)


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Data Privacy Pending Legislation

An amendment (approved in 2006 by Indian cabinet) tothe IT Act to expressly addresses data privacy yet tobe passed by Parliament

The new bill: Stipulates security practices to be followed by corporations

that handle personal data

Impose civil and criminal penalties for negligent handlingor intentional misuse of personal data

Imposes liability on intermediary only in limited situations

Permits private enforcement for civil remedies


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Other Protection

Specific Relief Act to Enforce Protective ContractualProvisions

Indian Penal Code: Limited criminal recourse available:

To prosecute incidents of theft, criminal breach of trust and fraudinvolving data

Laws extend to offenses against corporeal property only

Common Law Remedies: Civil damages and injunctive

relief available: Breach of contract

Breach of confidence


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Enforcement

In India, the enforcement system for IP rights includes: Civil remedies Criminal penalties Settlement out of court without trail

Compensatory damages

No punitive damages

Registration of copyrights

Criminal prosecution in trademark and copyright cases,but not in patents or designs cases


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Recommendations

Practices to Safeguard Trade Secrets and ConfidentialInformation between:

Comprehensive operative contracts, specifically providing forownership of IP

Non-disclosure agreements directly with the Indian serviceproviders employees and consultants assigned to the

project wherever practicable


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Thank You

522 Maker Chambers V221 Nariman Point

Mumbai 400 021, India.Tel: +91 22 6615 6555Fax: +91 22 2287 2080

Email: [email protected]
mailto:[email protected]:[email protected]

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