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03 November 2014
Section 22 of the Designs Act 2000 deals with piracy of registered designs and enumerates the reliefs available to registered design owners:
"(I) During the existence of copyright in any design it shall not be lawful for any person-
(a) for the purpose of sale to apply or cause to be applied to any article in any class of articles in which the design is registered, the design or any fraudulent or obvious imitation thereof, except with the license or written consent of the registered proprietor, or to do anything with a view to enable the design to be so applied; or
(b) to import for the purposes of sale, without the consent of the registered proprietor, any article belonging to the class in which the design has been registered, and having applied to it the design or any fraudulent or obvious imitation thereof, or
(c) knowing that the design or any fraudulent or obvious imitation thereof has been applied to any article in any class of articles in which the design is registered without the consent of the registered proprietor, to publish or expose or cause to be published or exposed for sale that article.
(2) (1) If any person acts in contravention of this section, he shall be liable for every contravention-
(a) to pay to the registered proprietor of the design a sum not exceeding twenty-five thousand rupees recoverable as a contract debt, or
(b) if the proprietor elects to bring a suit for the recovery of damages for any such contravention, and for an injunction against the repetition thereof, to pay such damages as may be awarded and to be restrained by injunction accordingly:
Provided that the total sum recoverable in respect of any one design under clause (a) shall not exceed fifty thousand rupees:
Provided further that no suit or any other proceeding for relief under this subsection shall be instituted in any court below the court of District Judge.
(3) In any suit or any other proceeding for relief under subsection (2), every ground on which the registration of a design may be cancelled under section 19 shall be available as a ground of defence.
(4) Notwithstanding anything contained in the second proviso to sub-Section (2), where any ground for which the registration of a design may be cancelled under section 19 has been availed of as a ground of defence and sub-section (3) in any suit or other proceeding for relief under sub-section (2), the suit or such other proceedings shall be transferred by the Court in which the suit or such other proceeding is pending, to the High Court for decision.
(5) When the court makes a decree in a suit under sub-section (2), it shall send a copy of the decree to the Controller, who shall cause an entry thereof to be made in the register of designs."
One school of thought is that Section 22(2) and the first proviso thereunder limit the amount of damages that design owners may seek to Rs50,000. However, a clear reading of the sub-clauses of Section 22(2) reveals that it provides two reliefs to registered design owners in the event of infringement:
These two options are disjunctive in nature, which means that design owners must choose between the two. Critically, the Rs50,000 cap for "every design" prescribed in the first proviso applies only to the first relief. Simply put, no pecuniary limit exists on damages that registered design owners may seek, should they institute a suit for damages and injunction under the second relief.
If this is the case, how does one interpret the first relief and first proviso together? Based on a combined reading of Section 22(2)(a) and the first proviso, it follows that when design owners opt for the first relief by way of a contract debt, although they are entitled to recover a maximum of Rs25,000 from the infringer "for every contravention", owners may recover a maximum of Rs50,000 for infringement of a design, regardless of the number of contraventions with respect to the design. In other words, under the first relief, the statutorily prescribed limit is Rs50,000 for infringement of a single design, regardless of the number of contraventions. Therefore, if in the same infringing act the infringer violates multiple design registrations of the same owner, the owner is entitled to recover a maximum of Rs50,000 for each of the designs.
However, this raises more questions. Since the first relief provides no injunctive relief, after recovering a maximum of Rs50,000 for infringement of every design, do design owners have the right to recover more money in the event of a subsequent infringement? If not, what is the incentive for design owners to choose the first relief, if it does not act as a deterrent to the infringer? Further, with respect to a first cause of action, if design owners opt for the first relief, are they barred from instituting a suit for damages for a subsequent infringement by the same infringer? Unfortunately, the provision does not seem capable of providing answers. It is hoped that, given the opportunity, an Indian court will address these questions in future.
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