Last week, His Honour Vipin Sanghi of Delhi High Court has ruled on the point of the territorial jurisdiction in intellectual property civil actions. The matter was World Wresteling Entertainment versus Reshma Collection.
Briefly stated, World Wrestling Entertainment Inc. (WWE), a Delaware corporation, instituted a civil action in Delhi High Court against a Mumbai based company. The allegation of WWE was that the Defendants were selling apparels and related items prominently displaying WWE’s characters and talents.
WWE claimed jurisdiction of Delhi High Court on the basis of following: -
- The broadcast of its programmes in Delhi;
- Its merchandise being available for sale in Delhi; and
- The merchandise is available on its website which is accessible in Delhi.
At the inception stage before even registering the plaint and issuing the summons of the suit to the Defendants, His Honour wanted to satisfy himself whether the Court had jurisdiction to entertain the matter. Mr. Pravin Anand, representing WWE, submitted at length the arguments and various precedents to impress upon His Honour that the Court indeed had territorial jurisdiction.
It was not the case of WWE that the goods of the Defendants were available in Delhi. So WWE invoked the jurisdiction of the High Court only on account of Section 134 of the Trade Marks Act, 1999 and Section 62 of the Copyright Act. Both the provision provides an additional ground to the Plaintiff to institute a civil action provided Plaintiff is residing or carrying on business within the jurisdiction of the Court.
Mr. Anand submitted that although WWE has no place of business in Delhi, the transactions taking place online, a Company should be deemed to carry on the business within the territorial limits of the Court since the website can be accessed by residents of Delhi. Mr. Anand further submitted that the issue whether the Plaintiff carries on business in a particular territory is a mixed question of law and fact can could be gone into at the final hearing of the trial.
Per His Honour Sanghi,
The test to be satisfied as regards the aspect of carrying on business has been laid down in Dhodha House (supra). The sum and substance of the criteria laid down in Dhodha House (supra) is that an essential part of the plaintiff‟s business , coupled with an element of control exercised by the plaintiff, must exist in such place where the plaintiff claims to be carrying on business either on its own or through an exclusive agent.
Mr. Anand submitted that the Courts should now take into account a concept of “New Media” and make arrangements for the technological advancements. His Honour, rejecting this argument, held that the advent of internet transaction can be also compared to the time when the transaction used to take place simply by telephones and fax involving more than one jurisdiction. The New Media, per His Honour, is as applicable as Old Media which has always been used.
Mr. Anand relied upon the ruling of Division Bench in Banyan tree Holding. In that case, the DB held that if a Defendant, through its website, targeting people of a particular jurisdiction then the Court in that jurisdiction can entertain a civil action. However, His Honour Sanghi categorically pointed out that the situation at hand was not the Defendant’s site but of WWE’s. Hence, the reliance was of no consequence.
Finally, per His Honour in paragraph 30: -
When it is clear to me that this Court has no territorial jurisdiction even in the face of the plaintiffs own averments in the plaint, I am not inclined to issue summons to the defendant. The Court is obliged to return the plaint under Order 7 Rule 10 CPC, once it becomes clear that it has no jurisdiction, to be presented to the Court in which the suit should have been instituted.
Territorial jurisdiction is always the most simple aspect in a civil action for intellectual property right. However, it is, at the same time, most contentious point of determination and takes up most of the judicial time of Delhi High Court.
Lets see if WWE challenges the order or files the action in Mumbai, where Defendants are situated.