vgEx77/n3KNYvo AQ5etLKihP4KuiZ Banyan Tree Hold MANU/DE/2592/2

MANU/DE/2592/2008
Equivalent Citation: 2008(38)PTC288(Del)
IN THE HIGH COURT OF DELHI
CS (OS) 894/2008
Decided On: 11.08.2008
Appellants: Banyan Tree Holdings Limited
Vs.
Respondent: M. Murali Krishna Reddy and Anr.
Hon'ble Judges/Coram:
S. Ravindra Bhat, J.
Counsels:
For Appellant/Petitioner/plaintiff: Neeraj Kishan Kaul, Sr. Adv., Pravin Anand and
Abhilasha Kumbhat, Advs.
For Respondents/Defendant: None
Subject: Intellectual Property Rights
Catch Words
Mentioned IN
Acts/Rules/Orders:
Code of Civil Procedure, 1908 (CPC) - Section 20; Trademark Act, 1999 - Section 134,
Trademark Act, 1999 - Section 134(2); Copyright Act, 1957 - Section 62(2); General
Rule ;Information Technology Act, 2000 - Section 2, Information Technology
Act, 2000 - Section 11, Information Technology Act, 2000 - Section 12,
Information Technology Act, 2000 - Section 13, Information Technology Act,
2000 - Section 75
Cases Referred:
India TV v. India Broadcast Live 2007 (35) PTC 177; Hasbro inc v. Clue Computing
994 F. Supp. 34; Casio India Co. Ltd. v. Ashita Tele Systems Pvt. Ltd. 2003 (27) PTC
265 (Delhi); Dow Jones and Co. Inc. v. Gutnic (2002) HCA 56; TV Independent News
Service Pvt. Ltd. v. India Broadcast Live Llc and Ors. 145 (2007) DLT 521; Zippo Mfr.
Co. v. Zippo Dot Com, Inc. 952 F. Supp. 1119; E.g. CompuServe, Inc. v. Patterson 89
F.3d 1257; E.g. Bensusan Restaurant Corp., v. King 937 F. Supp. 295; E.g. Maritz,
Inc. v. Cybergold Inc. 947 F. Supp. 1328; Search Force v. Dataforce Int'l 112 F. Supp.
2d 771; e.g., Sports Auth. Mich., Inc. v. Justballs, Inc. 97 F. Supp. 2d 806, 811-12;
Uncle Sam's Safari Outfitters, Inc. v. Uncle Sam's Army Navy Outfitters-Manhattan,
Inc. 96 F. Supp. 2d 919, 924-25; Nissan Motor Co. Ltd. v. Nissan Computer Corp.; IB
Oxford Holdings. Inc. v. Net Trade. Inc. 76 F. Supp. 2d 1363. 1367-68; Rannoch. Inc.
v. Rannoch Corp. 52 F. Supp. 2d 681. 686; Toys 'R' US v. Step Two 2003 US App.
Lexis 1355; Calder v. Jones 465 US 783 (1984); e.g., S. Morantz, Inc. v. Hang and
Shine Ultrasonics, Inc. 79 F. Supp. 2d 537, 540; Desktop Technologies, Inc. v.
Colorworks Reprod. and Design 1999 U.S. Dist. LEXIS 1934, 1999 WL 98572; ALS
Scan, Inc. v. Digital Serv. Consultants, Inc. 293 F. 3d 707; United States including
Wortham v. KarstadtOuelle AG (In re Nazi Era Cases Against German Defendants
Litig.). 153 Fed. Appx. 819, 2005 U.S. App. Lexis 22715; Decker v. Dyson. 165 Fed.
Appx. 951, 2006 U.S. App. LEXIS 1272; Sathianathan v. Pac. Exch., Inc. 248 Fed.
Appx. 345, 2007 U.S. App. LEXIS 22084; Desjean v. Intermix Media [2006] F.C.J. No.
1754; Morguard Investments Ltd. v. De Savoye [1990] 3 SCR 1077; Flowers Inc v.
Phonenames [2002] FSR 12; Dabur India Limited v. KR Industries (2006) 33 PTC 348;
Dhodha House v. S.K. Maingi MANU/SC/2524/2005 : (2006) 9 SCC 41; ONGC v.
Utpal Kumar Basu MANU/SC/0759/1994 : (1994) 4 SCC 711; Dabur India v. K.R.
Industries MANU/SC/2244/2008 : 2008 (37) PTC 332 (SC); Sector Twenty-one
Owners' Welfare Association v. Air Force Naval Housing Board 65 (1997) DLT 81 (DB);
H.P. Horticulture Produce Marketing and Processing Corpn. v. M.M. Breweries
MANU/PH/0147/1981 : AIR 1981 P&H 117; Gold Seal Engineering Products v.
Hindustan Manufacturers MANU/MH/0029/1992 : AIR 1992 Bom. 144; Gupta
Brothers Conduit Pipe Manufacturing Co. v. Anil Gupta (2001) 24 PTC 159; Haryana
Milk Foods v. Chambel Diary Products (2002) 25 PTC 156; ABC Laminart v. AP
Agencies MANU/SC/0001/1989 : (1989) 2 SCC 163
Citing Reference:




Discussed

23

Mentioned

13

Case Note:
Intellectual Property Rights - Injunction - Trade Marks Act, 1999 -Plaintiff
sought decree for permanent injunction restraining Defendants from passing
off and diluting its trademark; it also seeks a decree for rendition of accounts
and damages - Hence, this Petition - Whether, Petitioner was entitled for
restraining Defendant for using name 'Banyan Tree Retreat' - Held, absence
of any legislative action conferring such "long arm" jurisdiction upon Courts,
which had to be settled authoritatively was whether mere web presence, with
or without any manifest intention to purposefully direct commercial presence
in the court's jurisdiction, entitled a Court to entertain it, where Defendant
lived outside the territorial jurisdiction of court, and carries on its activities
for gain - Question was of some significance, because Parliament intended
that "normal" rules of jurisdiction in civil matters should be somewhat
different in cases of copyright infringement, and trademark infringement -
Therefore, Internet based activity or behavior could in some circumstances,
clothe this Court with jurisdiction, it would be appropriate to indicate
standards which could be applied with some constancy - Thus, matter was
remitted back to adjudicate accordance with law - Petition disposed of.

Intellectual Property Rights - Jurisdiction - Information Technology Act, 2000
- Held, action was not for trademark infringement - Defendant's "residence"
was not in territorial jurisdiction of court - It did not also had any branch or
other offices in Delhi - Slender thread relied on by Plaintiff was web site of
Defendant, and "trap transaction" whereby brochure was ordered by it, from
Defendant, and received in New Delhi - Web site, screen shots of which had
been reproduced, revealed that Defendant had disclosed its activities - It
contained web pages eliciting a feedback, and link to an "E-Brochure" -
Defendant had "banyan tree" retreated in Hyderabad, at three locales -
Defendant did not had any application form, which could be used by potential
customer - Even brochure produced by Plaintiff, along with the documents,
mentioned booking amount for a unit - Further, Parliament wanted to
redefine issue of jurisdiction, it did so, in terms of Section 134(2) of the
Trade marks Act, 1999 and 62(2) of the Copyright Act, 1957 - Therefore,
Internet based activity or behavior could in some circumstances, clothed
Court with jurisdiction, it would be appropriate to indicate standards, which
could be applied with some constancy - Thus, matter was remitted back to
adjudicate accordance with law - Petition disposed of.
Ratio Decidendi:
"Court shall not pass any order without proper territorial jurisdiction."
JUDGMENT
S. Ravindra Bhat, J.
1. This order deals with the question whether this Court can entertain and try the
present suit, and whether the cause of action, or any part thereof, has arisen within
the territorial jurisdiction of the court. The plaintiff prefers the present action seeking
decree for permanent injunction restraining the defendants from passing off and
diluting its trademark; it also seeks a decree for rendition of accounts and damages.
2. It is averred that the plaintiff is a publicly listed company having its registered office
at Singapore, and is a part of a group that is extensively involved in the hospitality
business, managing about 81 hotels, resorts and spas in various parts of the world. It
is averred that the plaintiff and its sister concerns have since the year 1994 adopted
and used the word mark 'Banyan Tree' and also the banyan tree device, both of which
were also used by its predecessor in interest. It is also averred that due to the
extensive and continuous use of the marks in relation to its business, they have
acquired secondary meaning. The plaintiff also avers that it has advertised its services
and products through the print and electronic media, many of which have substantial
reach and circulation in India. The plaintiff also maintains websites
(www.banvantree.com; www.banvantreespa.com etc) since the year 1996, which are
accessible in India. Due to the plaintiff's reputation and goodwill, it is submitted that
the said marks have become highly distinctive and have come to be associated with
the plaintiff and its sister concerns.
3. Further, it is averred that the goodwill and reputation of the plaintiff's trademarks
have spilled into India because of the large scale travel of tourists from and into India,
creating awareness about the said marks, the publicity given by various magazines
and journals and the online presence on the Internet. It is also submitted that plaintiff,
from the year 2002 onwards, in collaboration with the Oberoi Group, operates 15 spas
across India. Though the plaintiff is the registered proprietor of the marks in various
countries, it does not hold any registration for the said marks in India, but has sought
registration.
4. The plaintiff avers that in October 2006 it came to know that the defendants, who
are residents of Hyderabad, Andhra Pradesh, had initiated work on a project under the
name 'Banyan Tree Retreat'. It is submitted that the word mark and the device
adopted by the defendants in relation to its retreat is deceptively similar to that of the
plaintiff. It is averred that the defendants have advertised their project in their website
www.makprojects.com/banyantree. It is alleged that such use was meant to unlawfully
appropriate the reputation and goodwill of the plaintiff. It is alleged that since the
defendants belong to the same trade/industry, such adoption of the plaintiffs mark is
dishonest and is motivated to create deception among the public. Therefore, the
plaintiff seeks an ex parte interim injunction restraining the defendants from using its
marks.
5. The plaintiff claims that this Court has the territorial jurisdiction to entertain the suit
in the following manner:
30. This Hon'ble Court has the territorial jurisdiction to entertain the present suit
under Section 20 of the Code of Civil Procedure, 1908 since the Defendants
solicit business through use of the impugned mark "BANYAN TREE RETREAT" and
the Banyan Device in Delhi, The plaintiff submits that the services of the
Defendants are being offered to the customers in Delhi and hence the cause of
action has arisen within the jurisdiction of this Hon'ble Court. Also, the brochure
sent by the Defendants for the purpose of sale of the property to customers in
Delhi depicts that they carry on business and work for gain in Delhi. Further, the
defendants have presence in Delhi through their website
http://www.makprojects. Com/banyantree.htm, which is accessible in Delhi. It is
pertinent to mention that the said website is not a passive website not only
provides for contract information but also seeks feedback and inputs from its
customers through an interactive web-page. The plaintiff further submits that
the services of the Defendants are being offered to the customers in Delhi also
because of the ubiquity, universality and utility of the features of the Internet
and World Wide Web and hence the cause of action has arisen within the
jurisdiction of this Hon'ble Court
It can therefore, be gleaned from the above extract that the territorial jurisdiction of
this Court is sought be established on the following grounds. Firstly, that the services
of the defendant are being offered to residents of Delhi and hence the cause of action
has arisen within Delhi. In this regard the plaintiffs have produced brochures sent by
the defendant for the purpose of sale of the property to customers in Delhi, which the
plaintiff claims is evidence of the fact that the defendants carry on business within the
territorial jurisdiction of the Court. Secondly, that the defendants' website is accessible
from anywhere in India, is interactive in nature and not passive, providing contact
details, feedback and inputs. Further, the plaintiff also relies on the ubiquity,
universality and the utility of the features of the defendant's website on the Internet.
6. Mr. Neeraj Kishan Kaul, learned Senior Counsel appearing on behalf of the plaintiffs
relied upon the decision in India TV v. India Broadcast Live MANU/DE/1703/2007 :
2007 (35) PTC 177 (Del) to canvass the point that in cases of interactive websites, this
Court ought to exercise its jurisdiction. He further placed reliance on Casio India Co. v.
Ashita Telesystems 2003 (27) PTC 265 to advance the proposition that the access to
the website is sufficient to vest this Court with jurisdiction. Further reliance was placed
on a decision of the District Court of the Massachusetts, United States reported as
Hasbro inc v. Clue Computing 994 F. Supp. 34. Mr. Kaul drew the attention of this
Court to the affidavit of one Mr. D.C. Sharma, an independent investigator deployed
by the plaintiffs. In his affidavit Mr. Sharma deposed as to how using the contacts
provided on the defendants' websites, he contacted the Deputy Manager of the
defendants and solicited information about the details of the 'Banyan Tree Retreat'
project, which was duly supplied by electronic mail. He also drew the attention of the
Court to the brochures sent by the defendants to Mr. D.C. Sharma. He argued that the
website of the defendants, besides providing other information, also gave contact
details and included feedback forms where customers could write comments and seek
information. Counsel argued that in these circumstances, there was sufficient material
on record disclosing that a part of the cause of action, as understood under Section
20, CPC, arose within the jurisdiction of this Court, though neither party resided or
worked for gain within the jurisdiction of the court.
7. The plaintiff is basing its claims on a passing off action; thus, the provision of
Section 134(2) of the Trademarks Act, (which concerns infringement actions) is not
available to it. That section, like Section 62(2) of the Copyright Act, enables a plaintiff
to sue the defendant in a court, within whose jurisdiction it (the plaintiff) resides or
works for gain. The court has therefore to, focus on whether web hosting of the kind
allegedly indulged by the defendant, is sufficient to prima facie infer that a part of the
cause of action arises within jurisdiction of this Court. Before a detailed discussion of
case law, it would be relevant to extract Section 20 of CPC, which is as follows:
20. Other suits to be instituted where defendants reside or cause of action
arises. Subject to the limitations aforesaid, every suit shall be instituted in
Court within the local limits of whose jurisdiction
(a) the defendant, or each of the defendants where there are more than one,
at the time of the commencement of the suit, actually and voluntarily resides,
or carries on business, or personally works for gain; or
(b) any of the defendants, where there are more than one, at the time of the
commencement of the suit actually and voluntarily resides, or carries on
business, or personally works for gain, provided that in such case either the
leave of the Court is given, or the defendants who do not reside, or carry on
business, or personally work for gain, as aforesaid, acquiesce in such
institution; or
(c) the cause of action, wholly or in part, arises.
...
[Explanation].--A corporation shall be deemed to carry on business at its sole
or principal office in [India] or, in respect of any cause of action arising at any
place where it has also a subordinate office, at such place.
Decided cases in India
8. The first decided case, concerning exercise of jurisdiction, based upon a defendant
offering products or services on its web site, was Casio India Co. Ltd. v. Ashita Tele
Systems Pvt. Ltd. MANU/DE/0739/2003 : 2003 (27) PTC 265 (Del.). It was urged
there that the circumstance of the defendant's web site being capable of being
accessed from Delhi, was sufficient to invoke the territorial jurisdiction of this Court.
The Court, through a single judge (Sarin, J) in Casio relied on the judgment of the
High Court of Australia in Dow Jones and Co. Inc. v. Gutnic (2002) HCA 56 which ruled
that due to the ubiquity, universality and utility of the features of the Internet and
Worldwide Web, any matter associated with it possesses global jurisdiction. The court,
in Casio, reasoned thus:
From the foregoing judicial pronouncements, it would be seen that once access
to the impugned domain name website, could be had from anywhere else, the
jurisdiction in such matters cannot be confined to the territorial limits of the
residence of the defendant. Further more in a passing off action it is not
incumbent upon the plaintiff to prove any actual sale or any particular act of
deception, mere likelihood of deception, whereby an average person is likely to
be deceived or confused is sufficient to entertain an action for passing off.
Therefore, it is not at all required to be proved that any actual deception took
place at Delhi. Accordingly the fact that the website of defendant No. 1 can be
accessed from Delhi is sufficient to invoke the territorial jurisdiction of this Court
in the light of the judicial principles enunciated in the above judgments. It is,
accordingly, held that the objection with regard to the territorial jurisdiction is
without merit and this Court can try and entertain the suit.
9. In India TV Independent News Service Pvt. Ltd. v. India Broadcast Live Llc and Ors.
145 (2007) DLT 521 the court took a different approach. It noticed the decision of a
Federal District Court in Zippo Mfr. Co. v. Zippo Dot Com, Inc. 952 F. Supp. 1119
(W.D. Pa. 1997), (hereafter "Zippo") and other decisions in the United States, cited
before it. The court, speaking through another single judge, (Kaul, J) held that:
44. As regards the exercise of personal jurisdiction in cases involving Internet
activities, the position appears to be that mere 'passive' posting of a website
does not give jurisdiction to the Court within whose jurisdiction, the
complainant company is present. Thus, personal jurisdiction cannot be
exercised over non-residents merely because their website is accessible within
the jurisdiction of the Court. There has to be something more to indicate
purposeful direction of activity to the forum state in a substantial way. In
Cybersell Inc. case (supra) limited interactivity of the website restricted to
received browser's name and expression of interest but not signing up for the
services provided was not considered to be sufficient for the exercise of
jurisdiction.
45. Insofar as the position in this country is concerned, there is no 'long arm'
statute as such which deals with jurisdiction as regards non-resident
defendants. Thus, it would have to be seen whether the defendant's activities
have a sufficient connection with the forum state (India); whether the cause of
action arises out of the defendant's activities within the forum and whether the
exercise of jurisdiction would be reasonable.
46. I am in agreement with the proposition that the mere fact that a website is
accessible in a particular place may not itself be sufficient for the Courts of
that place to exercise personal jurisdiction over the owners of the website.
However, where the website is not merely 'passive' but is interactive
permitting the browsers to not only access the contents thereof but also
subscribe to the services provided by the owners/operators, the position would
be different. However, as noticed in the judgment in CyberSell Inc. case
(supra), even where a website is interactive, the level of interactivity would be
relevant and limited interactivity may also not be sufficient for a Court to
exercise jurisdiction. In Panavision International LP case (supra), it was found
that the registration of the plaintiff's mark as a domain name by the defendant
had the effect of injuring the plaintiff in California and therefore the Court had
jurisdiction. In CompuServe case (supra) again it was found that the
defendant had contacted Ohio to sell his computer software on the plaintiffs
Ohio based systems and sent his goods to Ohio further for their ultimate sale
and thus those Courts had jurisdiction.
10. The court also considered, on the facts before it, that the defendant had, in the
written statement, claimed its global presence in several countries, including India; its
CEO's statement about targeting the large Indian consumer base too was relied upon;
the court concluded that there was sufficient material to exercise jurisdiction.
11. Since Zippo, courts in the United States, particularly several Federal Appellate
Circuit Courts have re-visited the question of jurisdiction. Significantly, in the United
States, "long arm" statutes, enabling exercise of jurisdiction, subject to Federal
("Commonwealth" as described in States' Constitutions) "due process clause", exist.
The wide formulation in Zippo has since been narrowed down. It would be useful to
consider the post Zippo position on the subject, as far as United States is concerned,
as well as the position existing in the UK and Canada.
The position in United States
12. In Zippo the Court, followed "the totality of contacts" approach, and enunciated
what may be termed "the sliding scale" doctrine with regard to exercise of jurisdiction
over trademark infringement, happening over the internet. The plaintiff, a well known
manufacturer of lighters, sued the defendant for infringing its trademark by using it on
its domain names in websites accessible from Pennsylvania, whereas the defendant
was actually a resident of California. The defendant was an Internet news service
provider, with whom a customer could register online through an application, pay
through credit cards and was also through the Internet assigned password to access
the necessary newsgroup messages. The Court held:
Nevertheless, our review of the available cases and materials reveals that the
likelihood that personal jurisdiction can be constitutionally exercised is directly
proportionate to the nature and quality of commercial activity that an entity
conducts over the Internet. This sliding scale is consistent with well developed
personal jurisdiction principles. At one end of the spectrum are situations
where a defendant clearly does business over the Internet. If the defendant
enters into contracts with residents of a foreign jurisdiction that involve the
knowing and repeated transmission of computer files over the Internet,
personal jurisdiction is proper. E.g. CompuServe, Inc. v. Patterson 89 F.3d
1257 (6th Cir. 1996). At the opposite end are situations where a defendant
has simply posted information on an Internet Web site which is accessible to
users in foreign jurisdictions. A passive Web site that does little more than
make information available to those who are interested in it is not grounds for
the exercise personal jurisdiction. E.g. Bensusan Restaurant Corp., v. King 937
F. Supp. 295 (S.D.N.Y.1996). The middle ground is occupied by interactive
Web sites where a user can exchange information with the host computer. In
these cases, the exercise of jurisdiction is determined by examining
the level of interactivity and commercial nature of the exchange of
information that occurs on the Web site. E.g. Maritz, Inc. v. Cybergold,
Inc. 947 F. Supp. 1328 (E.D.Mo.1996).
(emphasis supplied)
13. Relevant portions of the concerned "long arm statute" in issue, concerning
jurisdiction in such cases and considered by the Court, read as follows:
42 Pa.C.S. 5322 (2008) 5322. Bases of personal jurisdiction over persons
outside this Commonwealth
(a) General Rule-- A tribunal of this Commonwealth may exercise personal
jurisdiction over a person (or the personal representative of a deceased
individual who would be subject to jurisdiction under this subsection if not
deceased) who acts directly or by an agent, as to a cause of action or other
matter arising from such person:
(1) Transacting any business in this Commonwealth. Without excluding other
acts which may constitute transacting business in this Commonwealth, any of
the following shall constitute transacting business for the purpose of this
paragraph:
(i) The doing by any person in this Commonwealth of a series of similar acts
for the purpose of thereby realizing pecuniary benefit or otherwise
accomplishing an object.
(ii) The doing of a single act in this Commonwealth for the Purpose of thereby
realizing pecuniary benefit or otherwise accomplishing an object with the
intention of initiating a series of such acts.
(iii) The shipping of merchandise directly or indirectly into or through this
Commonwealth.
(iv) The engaging in any business or profession within this Commonwealth,
whether or not such business requires license or approval by any government
unit of this Commonwealth.
...
(2) Contracting to supply services or things in this Commonwealth.
(b) Exercise of Full Constitutional Power Over Nonresidents- In addition to the
provisions of Sub-section (a) the jurisdiction of the tribunals of this
Commonwealth shall extend to all persons who are not within the scope of
Section 5301 (relating to persons) to the fullest extent allowed under the
Constitution of the United States and may be based on the most minimum
contact with this Commonwealth allowed under the Constitution of the United
States.
14. Zippo has been one of the most cited judgments regarding exercise of jurisdiction,
when allegations that infringement has occurred on the Internet. In Search Force v.
Dataforce Int'l 112 F. Supp. 2d 771 (S.D. Ind. 2000), the Court, while dealing with
infringement of trademark on the Internet noted that the Fifth, Ninth, and Tenth
Circuits (US Federal appellate courts) had relied upon the analytical framework set out
in Zippo to determine the propriety of exercising jurisdiction based on Internet
activity. It observed that:
Recent district court cases involving Internet activity and trademark
infringement claims reinforce the notion that a defendant must avail itself of the
forum state in a manner that is somehow more purposeful than an allegedly
infringing domain name or use of an allegedly infringing mark on an interactive
web site. See, e.g., Sports Auth. Mich., Inc. v. Justballs, Inc. 97 F. Supp. 2d
806, 811-12 (E.D. Mich. 2000) (finding personal jurisdiction where defendant
operated a virtual store which he did not deny had resulted in sales to entities in
the forum state); Euromarket Designs, Inc. 96 F. Supp. 2d 838 (finding personal
jurisdiction where defendant not only operated an online catalog from which
purchases could be made, but also had additional non-Internet contacts with
forum state); Uncle Sam's Safari Outfitters, Inc. v. Uncle Sam's Army Navy
Outfitters-Manhattan, Inc. 96 F. Supp. 2d 919, 924-25 (E.D. Mo. 2000) (finding
no personal jurisdiction where defendants' web site featured their retail (and
allegedly infringing) name and allowed customers to view merchandise available
for order by calling a toll-free telephone number listed on the site, but there was
no evidence that anyone from the forum state had contacted the web site);
Nissan Motor Co. Ltd. v. Nissan Computer Corp. 89 F. Supp. 26 1154. 1159 (CD.
Cal. 2000) (finding personal jurisdiction where defendant not only used plaintiff's
trademark as its domain name, but also had contracts with five companies in the
forum state); IB Oxford Holdings. Inc. v. Net Trade. Inc.. 76 F. Supp. 2d 1363.
1367-68 (S.D. Fla. 1999) (no personal jurisdiction where defendant had a
pending application to do business in the forum state and three interactive web
sites (but no indication that a forum resident ever interacted with the defendant
on any site)); Rannoch. Inc. v. Rannoch Corp.. 52 F. Supp. 2d 681. 686 (E.D.
Va. 1999) (holding that exercising personal jurisdiction would exceed
constitutional bounds where evidence of the defendant's "contacts" were a web
site with the allegedly infringing trade name, a toll-free number, fax number, e-
mail address, interactive comment form, hypertext links, interactive form for
direct placement of classified ads with defendant, and no showing of how the
defendant distinctly availed itself of the forum state differently than of all other
states having residents with access to the site).
15. The Zippo analysis has been modified and narrowed down in subsequent
judgments. Prominent is the Court of Appeal (3rd Circuit) in Toys 'R' US v. Step Two
2003 US App. Lexis 1355. The case here involved the use of a trademark Imaginerium
by both the plaintiff and the defendant in their respective websites. The plaintiff was a
New Jersey based corporation that manufactured and marketed toys. The defendant
was a Spanish corporation also engaged in the same business. Both the entities had
registered their respective websites using the term 'imaginerium' since the mid
nineties. The defendant did not have any official presence in the United States but
operated an interactive website through which persons residing in New Jersey could
place orders and receive products. The customers could also join an online club from
which games and other content could be downloaded. The plaintiff also gave evidence
of at least two residents in New Jersey having placed orders on the defendant's
website and received the products too. The Court found that both the transactions
were "orchestrated" by Toys. Even though the Court cited Zippo as the seminal
authority, it went on to state that a commercially interactive website by itself was
insufficient to establish jurisdiction, and that there had to be evidence that the
defendant purposefully availed himself
by directly targeting its web site to the state, knowingly interacting with the
residents of the forum state via its web site, or through sufficient other related
contacts
which could be non-Internet related. The court concluded that personal jurisdiction
was lacking, firstly because there was no purposeful availing of the goods or services,
and secondly, applying the effects test, the defendant did not knowingly seek to
interact with U.S. residents. The 'effects test' was propounded in Calder v. Jones 465
US 783 (1984) (a case concerning a libel action), according to which courts could
exercise jurisdiction in cases where the acts were committed outside its jurisdiction,
but were intentionally aimed at the forum state and its effects were also felt in the
forum state. The Court observed:
Since Zippo, several district court decisions from this Circuit have made
explicit the requirement that the defendant intentionally interact with the
forum state via the web site in order to show purposeful availment and, in
turn, justify the exercise of specific personal jurisdiction. See, e.g., S. Morantz,
Inc. v. Hang and Shine Ultrasonics, Inc. 79 F. Supp. 2d 537, 540 (E.D. Pa.
1999) (observing that "a web site targeted at a particular jurisdiction is likely
to give rise to personal jurisdiction."). As another district court in this Circuit
put it, "courts have repeatedly recognized that there must be 'something
more' to demonstrate that the defendant directed its activity towards the
forum state." Desktop Technologies, Inc. v. Colorworks Reprod. and Design
1999 U.S. Dist. LEXIS 1934, 1999 WL 98572,
....
the mere operation of a commercially interactive web site should not
subject the operator to jurisdiction anywhere in the world. Rather,
there must be evidence that the defendant "purposefully availed"
itself of conducting activity in the forum state, by directly targeting its
web site to the state, knowingly interacting with residents of the
forum state via its web site, or through sufficient other related
contacts.
(emphasis supplied)
16. In ALS Scan, Inc. v. Digital Serv. Consultants, Inc. 293 F.3d 707, the Court of
Appeals for the Fourth Circuit observed:
Thus, adopting and adapting the Zippo model, we conclude that a State may,
consistent with due process, exercise judicial power over a person outside of
the State when that person (1) directs electronic activity into the State,
(2) with the manifested intent of engaging in business or other
interactions within the State, and (3) that activity creates, in a person
within the State, a potential cause of action cognizable in the State's
courts. Under this standard, a person who simply places information on the
Internet does not subject himself to jurisdiction in each State into which the
electronic signal is transmitted and received. Such passive Internet activity
does not generally include directing electronic activity into the State with the
manifested intent of engaging business or other interactions in the State thus
creating in a person within the State a potential cause of action cognizable in
courts located in the State.
(emphasis supplied)
17. The test evolved in Toys has been followed by various Courts of Appeals in the
United States including Wortham v. KarstadtOuelle AG (In re Nazi Era Cases Against
German Defendants Litig.). 153 Fed. Appx. 819, 2005 U.S. App. LEXIS 22715 (3d Cir.
N.J. 2005); Decker v. Dyson. 165 Fed. Appx. 951, 2006 U.S. App. LEXIS 1272 (3d Cir.
Pa. 2006) and Sathianathan v. Pac. Exch., Inc., 248 Fed. Appx. 345, 2007 U.S. App.
LEXIS 22084 (3d Cir. N.J. 2007).
18. Thus, jurisdiction could be either general or specific, but in both cases, even if the
effects are experienced in the forum state, the defendant must have knowingly and
intentionally (expressed in the judgment as "manifest intention") targeted the forum
state, with contacts either through the web (in which case the interactivity of the
website ought to be a relevant consideration) or through a non Internet based activity.
The position in Canada
19. The Federal Court in Canada, in a recent decision, considered and explored the law
related to jurisdiction over the Internet. In Desjean v. Intermix Media [2006] F.C.J.
No. 1754, the Court had to consider whether Intermix's bundling of intrusive spyware
programmes along with free downloadable software from the Internet, without the
express permission of the plaintiff amounted to violation of his rights. Intermix
pleaded that it was publicly traded Delaware Corporation with its principal offices in
Los Angeles, California and therefore, the action could be brought only in the State of
California. The Court while discussing the thorny question of jurisdiction over entities
not within the territorial jurisdiction of the court chose to rely on the following
observation made by the Supreme Court of Canada in Morguard Investments Ltd. v.
De Savoye [1990] 3 SCR 1077:
It seems to me that the approach of permitting suit where there is a real and
substantial connection with the action provides a reasonable balance between
the rights of the parties. It affords some protection against being pursued in
jurisdictions having little or no connection with the transaction or the parties. In
a world where even the most familiar things we buy and sell originate or are
manufactured elsewhere, and where people are constantly moving from province
to province, it is simply anachronistic to uphold a "power theory" or a single
situs for torts or contracts for the proper exercise of jurisdiction.
After discussing at length, various Canadian precedents on the issues, the Court
summarized the following as the criteria employed by the courts to assume
jurisdiction:
1. The connection between the forum and the plaintiff's claim;
2. The connection between the forum and the defendant;
3. Unfairness to the defendant in assuming jurisdiction;
4. Unfairness to the plaintiff in not assuming jurisdiction;
5. Involvement of other parties to the suit;
6. The court's willingness to recognize and enforce an extra-provincial
judgment rendered on the same jurisdictional basis;
7. Whether the case is interprovincial or international in nature; and
8. Comity and the standards of jurisdiction, recognition and enforcement
prevailing elsewhere.
20. Applying these factors to the before it, the court found that Canadian courts lacked
jurisdiction to entertain the action. It found that Intermix did not have any offices in
Canada although it had, in the past, subsidized office space for contractors working on
two websites purchased by Intermix. Also, Intermix did not have any employees in
Canada but only had a contractual relationship with two independent contractors in
Canada that provided newsletter edition services. Further, Intermix had in no way
availed itself of Canadian laws, as it did not transact any business in Canada through
the Website at issue. It had no bank accounts in Canada and did not pay taxes to
either the federal government or any provincial government nor was it registered as
doing business in any Canadian jurisdiction. Furthermore, Intermix had no direct
advertising, marketing or solicitation aimed at the Canadian market. The Court went
on to observe that it would be manifestly unfair to subject the defendant to the
jurisdiction of Canadian courts since, it would result in a US based operator of a
website with no business assets and no physical presence in Canada being sued there
and in any other country from which a plaintiff might chose to download its products.
The Court observed that in order to exercise jurisdiction, a "minimum contact" with
the concerned territory would have to be shown. This could either be through the
exercise of general jurisdiction or through the exercise of specific jurisdiction. That is,
the defendant must have ongoing and real contacts with the specific territory,
independent of the plaintiff's cause of action or must have purposefully directed
activities to the locale, which involves the examination of the interactivity of the
website. The Court then went on to hold that:
The record in the present case does not allow me to come to the conclusion that
the websites Intermix operates are interactive in nature. These websites do not
allow users to communicate and exchange information with the sponsors of the
site, or to order products online. But even if they could be characterized in such
a way, I do not think Intermix could be found to have the level of interactivity
with Canada that could justify a finding of minimum contact. The software that
can be downloaded from Intermix's websites is free, there has been no targeting
of Canada or of Canadian consumers in any specific way, there is no specific
content for a Canadian audience, and Intermix has never purposely availed itself
of Canada's laws.
The position in UK
21. In the United Kingdom the law in this regard is largely governed by the decision in
1-800 Flowers Inc v. Phonenames [2002] FSR 12 CA. There, use of the term '1-800'
by the appellant, a United States based corporation, in its website, was claimed as
'use in UK' for the purposes of trademark registration. The defendant was a UK based
phonebook company and the plaintiff was engaged in the business of delivery of
flowers. Customers across the world could access the appellant's website which was
hosted and maintained in the United States and place orders for flowers. The appellant
had no direct business presence in UK and did not have any office. Neither could it
place any conclusive evidence of UK residents having placed orders on its website.
Instead, it argued that merely because its website was accessible from UK and UK
residents could place orders online, its use of the mark 1-800 on its website amounted
to use in United Kingdom. In the first appeal Jacob J rejected the argument of the
appellant and held that website owner does not automatically 'put a tentacle onto the
user's screen'. He held that:
So I think that the mere fact that websites can be accessed anywhere in the
world does not mean, for trade mark purposes, that the law should regard
them as being used everywhere in the world. It all depends upon the
circumstances, particularly the intention of the website owner and what the
reader will understand if he accesses the site. In other fields of law,
publication on a website may well amount to a universal publication, but I am
not concerned with that. But even if Mr. Hobbs were right in saying that
website use amounted, for trade mark purposes, to use in omnipresent
cyberspace, I cannot see how that would help here. If you access the
applicant's site in the UK, you can order flowers. But the service of receiving
and [transferring] (i.e. the service of the specification) is carried out wholly in
New York....
In the result, I do not think that the applicants have the requisite intention to
use or in fact use the mark 800 flowers.
22. The Court of Appeals too rejected the argument of the appellants and Justice
Jonathan Parker held that:
In my judgment, however, the evidence in the instant case does not establish
actual user of the mark by the Applicant in the UK, even to the "minimal" extent
required (as illustrated by Chipie). In the first place, I reject as unreal the
submission that a telephone call from the UK to the Applicant's US telephone
number necessarily involves a use of the mark in the UK. Nor, in my judgment,
is the evidence (such as it is) concerning the Applicant's internet website
sufficient to justify the conclusion that accessing the website amounts to use of
the mark at the point of access. In any event, the evidence does not disclose the
extent to which the website has in fact been accessed from the UK. The
Applicant has never had a place of business in the UK; the services which it
provides are performed outside the UK; and, so far as the evidence goes, the
only piece of advertising directed specifically at the UK is the one advertisement
in the Independent newspaper to which I referred earlier.
Justice Buxton, in a concurring opinion too rejected the contention of the appellant and
held that:
I would wish to approach these arguments, and particularly the last of them,
with caution. There is something inherently unrealistic in saying that A "uses"
his mark in the United Kingdom when all that he does is to place the mark on
the internet, from a location outside the United Kingdom, and simply wait in
the hope that someone from the United Kingdom will download it and thereby
create use on the part of A. By contrast, I can see that it might be more easily
arguable that if A places on the internet a mark that is confusingly similar to a
mark protected in another jurisdiction, he may do so at his peril that someone
from that other jurisdiction may download it; though that approach conjured
up in argument before us the potentially disturbing prospect that a shop in
Arizona or Brazil that happens to bear the same name as a trademarked store
in England or Australia will have to act with caution in answering telephone
calls from those latter jurisdictions.
However that may be, the very idea of "use" within a certain area would seem
to require some active step in that area on the part of the user that goes
beyond providing facilities that enable others to bring the mark into the area.
Of course, if persons in the United Kingdom seek the mark on the internet in
response to direct encouragement or advertisement by the owner of the mark,
the position may be different; but in such a case the advertisement or
encouragement in itself is likely to suffice to establish the necessary use.
23. The above analysis of shows that recent trends abroad, post Zippo (a Federal
District court judgment) have diluted the understanding about ubiquity of internet as a
medium clothing courts with a kind of "universal" jurisdiction. The current
understanding, in United States is that, even with the aid of "long arm" statutes, such
as existing in various states, the courts are slow at entertaining claims of trademark
infringement where defendants do not direct electronic activity in the state concerned,
with the manifested intent of engaging in business or other interactions within the
State. Interactivity of a web site could be a criteria, but not the predominating one.
Canadian courts have independently reflected the same approach; the test indicated
by them (for assumption of jurisdiction by courts, based on existence of websites, or
some element of internet presence) is the defendant's "ongoing and real contacts"
with the specific territory, independent of the plaintiff's cause of action; or the
defendants must have "purposefully" directed activities to the locale. In the United
Kingdom too, such web hosting of infringers' products or services, or claims to "use"
have been held insufficient to clothe territorial jurisdiction, or by itself, constitute use
as to amount to a cause of action.
24. The question of defendant's activities, in relation to business transacted through
the Internet, has also been considered in the contextual background of "trap orders"
or "trap transactions" where the plaintiff, potentially engages in a transaction, either
itself, or through someone else, on its behalf, to approach the court, and claim that it
can exercise jurisdiction. The US courts' approach has been one disfavouring such
action- the decision in Toys said that the plaintiff "orchestrated" the situation, and
despite existence of a considerable degree of interactivity of the defendants' website,
refused to entertain the claim, on the ground that it was insufficient to disclose that
any direct electronic activity in the state concerned, (of the defendant, existed) with
its manifest intent of engaging in business or other interactions within the State.
25. As far as general principles of what constitutes cause of action are concerned, the
law is well settled. In Dabur India Limited v. KR Industries (2006) 33 PTC 348, a
Division Bench of this Court held that since the defendant was from Andhra Pradesh
and since there was no documentary evidence to show that the respondent was selling
its goods in Delhi, this Court did not have territorial jurisdiction. In Dhodha House v.
S.K. Maingi MANU/SC/2524/2005 : (2006) 9 SCC 41; the Supreme Court, after
noticing the decision in ONGC v. Utpal Kumar Basu MANU/SC/0759/1994 : (1994) 4
SCC 711, the Court had categorically held that a mere advertisement in a journal or
paper by itself, will not confer jurisdiction on the Court. In that context it also
observed that cause of action will arise only when the infringing goods are used not
when an application for registration is made or pending. This court's decision in Dabur
(supra) has been recently approved by the Supreme Court (See Dabur India v. K.R.
Industries MANU/SC/2244/2008 : 2008 (37) PTC 332 (SC). In Sector Twenty-one
Owners' Welfare Association v. Air Force Naval Housing Board 65 (1997) DLT 81 (DB)
it was held that a trivial or insignificant part of the cause of action arising at a
particular place would not be enough to confer jurisdiction on the court to entertain
the Us. Citing a number of precedents it observed that the emphasis had shifted from
the residence or location of the person or authority sought to be proceeded against, to
the situs of the accrual of the cause of action. In H.P. Horticulture Produce Marketing
and Processing Corpn. v. M.M. Breweries MANU/PH/0147/1981 : AIR 1981 P&H 117,
in relation to action for passing off, it was held that:
In a case of present nature, the cause of action partly or wholly can arise in a
given jurisdiction only if it is the defendant who is proved to have directly made
sale of the goods under the impugned trademark (within a given court) not to an
individual customer but to a distributor or a wholesaler or retailer and that such
a sale should be at a commercial scale.
26. In Gold Seal Engineering Products v. Hindustan Manufacturers
MANU/MH/0029/1992 : AIR 1992 Bom. 144, it was held that a suit for passing off
cannot be filed in Bombay if the defendants carry on business in Calcutta and that
supply of goods to Delhi was on a commercial basis. In Gupta Brothers Conduit Pipe
Manufacturing Co. v. Anil Gupta (2001) 24 PTC 159, this Court held that since neither
plaintiff nor the defendants have offices in Delhi and are not carrying on business in
Delhi, the suit had to be returned due to lack of jurisdiction. The court held, in
Haryana Milk Foods v. Chambel Diary Products (2002) 25 PTC 156 that for the
purposes of ascertaining territorial jurisdiction the entire plaint has to be taken into
consideration. In the case since the plaintiff could not prove that defendant had a
office in Delhi or carries on business in Delhi, the Court held that it did not have
territorial jurisdiction to adjudicate the matter.
27. Cause of action, though not defined by the legislature, consists of that bundle of
facts which give cause to enforce the legal injury. In ABC Laminart v. AP Agencies
MANU/SC/0001/1989 : (1989) 2 SCC 163, the Supreme Court held that cause of
action means that set of facts, which taken with the law applicable to them, gives the
plaintiff a right to claim relief against the defendant. If that were so, the cause of
action in a case of passing off would arise only when the defendant uses the impugned
trademark. The object of action for passing off being to protect the goodwill, the
goodwill will get affected only when the defendant markets his good under the
impugned mark. Therefore, the mere advertisement in the Trademarks Journal or
preferring of application or even the registration of a trademark at a particular place,
will not and cannot confer jurisdiction, since it cannot amount to cause of action in
relation to passing off.
28. In view of the above discussion, and the absence of any legislative action
conferring such "long arm" jurisdiction upon courts, (of the kind noticed and relied on
in Zippo and in other judgments by the US Courts) the question which has to be
settled authoritatively is whether mere web presence, with or without any manifest
intention to purposefully direct commercial presence in the court's jurisdiction, entitles
a court to entertain it, where the defendant lives outside the territorial jurisdiction of
the court, and carries on its activities for gain. The question is of some significance,
because Parliament intended that "normal" rules of jurisdiction in civil matters should
be somewhat different in cases of copyright infringement, and trademark infringement
(See Section 134, Trademark Act, 1999 and Section 62(2) Copyright Act, 1957: in
these provisions, the plaintiff can sue the defendant through action for infringement,
wherever the plaintiff resides or works for gain). Absence of any technology specific
amendment, in the opinion of this Court, is a relevant criteria for considering whether
internet related activity - even if some degree of interactivity of the website were to
enable a court, nevertheless to exercise jurisdiction, where the essential ingredients of
Sections 62(2) of the Copyright Act, and Section 134 of the Trademark Act, 1999 are
absent, and where otherwise the defendant resides and works for gain outside
jurisdiction of this Court.
29. Although in India TV Independent News Service Pvt. Ltd. the court has adopted a
somewhat nuanced approach, at the same time, it noticed the absence of long arm
statutes or provisions, in Indian law. That Parliament cannot be attributed lack of
awareness of such aspects is clear from provisions of the Information Technology
Act, 2000. Sections 2(j)(k) and (1) contain definitions which are of the widest
amplitude sufficient to accommodate the Internet and subsequent technologies. Other
provisions, particularly, Sections 11, 12 and 13, have some relevance; they read as
follows:
11. Attribution of Electronic Records
An electronic record shall be attributed to the originator
(a) if it was sent by the originator himself;
(b) by a person who had the authority to act on behalf of the originator in
respect of that electronic record; or
(c) by an information system programmed by or on behalf of the originator to
operate automatically.
12. Acknowledgement of Receipt
(1) Where the originator has not agreed with the addressee that the
acknowledgment of receipt of electronic record be given in a particular form or
by a particular method, an acknowledgment may be given by -
(a) any communication by the addressee, automated or otherwise; or
(b) any conduct of the addressee, sufficient to indicate to the originator that
the electronic record has been received.
(2) Where the originator has stipulated that the electronic record shall be
binding only on receipt of an acknowledgment of such electronic record by
him, then unless acknowledgment has been so received, the electronic record
shall be deemed to have been never sent by the originator.
(3) Where the originator has not stipulated that the electronic record shall be
binding only on receipt of such acknowledgment, and the acknowledgment has
not been received by the originator within the time specified or agreed or, if no
time has been specified or agreed to within a reasonable time, then the
originator may give notice to the addressee stating that no acknowledgment
has been received by him and specifying a reasonable time by which the
acknowledgment must be received by him and if no acknowledgment is
received within the aforesaid time limit he may after giving notice to the
addressee, treat the electronic record as though it has never been sent.
13. Time and Place of Despatch and Receipt of Electronic Record
(1) Save as otherwise agreed to between the originator and the addressee, the
dispatch of an electronic record occurs when it enters a computer resource
outside the control of the originator.
(2) Save as otherwise agreed between the originator and the addressee, the
time of receipt of an electronic record shall be determined as follows, namely
(a) if the addressee has designated a computer resource for the purpose of
receiving electronic records
(i) receipt occurs at the time when the electronic record enters the designated
computer resource; or
(ii) if the electronic record is sent to a computer resource of the addressee
that is not the designated computer resource, receipt occurs at the time when
the electronic record is retrieved by the addressee;
(b) if the addressee has not designated a computer resource along with
specified timings, if any, receipt occurs when the electronic record enters the
computer resource of the addressee.
(3) Save as otherwise agreed between the originator and the addressee, an
electronic record is deemed to "be dispatched at the place where the originator
has his place of business, and is deemed to be received at (he place where the
addressee has his place of business.
(4) The provisions of Sub-section (2) shall apply notwithstanding that the
place where the computer resource is located may be different from the place
where the electronic record is deemed to have been received under Sub-
section (3).
(5) For the purposes of this section
(a) if the originator or the addressee has more than one place of business, the
principal place of business, shall be the place of business;
(b) if the originator or the addressee does not have a place of business, his
usual place of residence shall be deemed to be the place of business;
(c) "usual place of residence", in relation to a body corporate, means the place
where it is registered.
30. Social advances, and changes in technology are not a new phenomenon.
Transactions; even contracts, pre-internet, could be negotiated and formalized with
the aid of technology - before the era of facsimile (FAX), it was first, through
telephone, then, telex and so on. These changes in technologies, were not used as
platforms to redefine standards for determining territorial jurisdiction. Similarly, the
advent of electronic media (first, radios, then the television and now, satellite
television and satellite radio) enhanced the capacity of those offering goods, products
and services to reach a wider audience. Introduction of new technology, therefore, by
itself is not a contributing factor to redefine standards for determining territorial
jurisdiction.
31. Cyberworld is a virtual world; it has an existence independent of material reality.
The hosting of a web portal or website, is, in a sense, akin to opening a showroom or
a shop. Though difficulties may be experienced by trademark owners at tackling with
infringement and passing off of their marks, in such cases nevertheless, a one-
dimensional approach to territorial jurisdiction, based on universal accessibility of a
particular web site cannot, in the opinion of the court, be justified to assume
jurisdiction, as is suggested in Casio. The ruling in India TV Independent News marks
a shift from Casio; nevertheless it lacks in explanation as to why a particular approach
commended itself to the court, sans any legislative activity, or long arm statutes of the
kind prevalent elsewhere. The resultant position is unsatisfactory, as both judgments
were by single judges, and do not spel out clear standards which are to guide
subsequent case. This leaves later benches of co-ordinate strength to prefer either the
casio ordained wider rule, or prefer a narrower route, suggested in India TV
Independent News.
32. In this case, the averments in the suit show that the plaintiff does not operate
within the jurisdiction of the court; the action is not for trademark infringement. The
defendant's "residence" i.e. registered office is not in the territorial jurisdiction of the
court. It does not also have any branch or other offices in Delhi. The slender thread
relied on by the plaintiff is the web site of the defendant, and the "trap transaction"
whereby a brochure was ordered by it, from the defendant, and received in New Delhi.
The web site, screen shots of which have been reproduced, reveals that the defendant
has disclosed its activities; it contains web pages eliciting a feedback, and link to an
"E-Brochure". The defendant's e-mail identification also figures in the web site; it
further discloses that the defendant has "banyan tree" retreats in Hyderabad, at three
locales. The layout plan of those retreats has been shown. However, the interactivity is
confined to a feedback dialog form; the defendant does not have any application form,
which can be used by a potential customer. Even the brochure produced by the
plaintiff, along with the documents, mentions the booking amount as Rs. Ten lakhs,
for a unit. The payment plan, which is apparently linked with the construction of the
unit, has been shown, but, significantly enough, without details of amounts. An overall
reading of the brochure does not enable the potential customer to know the cost of the
unit which he would like to book; he would have to interact further with the defendant,
as the solitary instance relied on by the plaintiff, in the affidavit, suggests.
33. In the light of the above developments, particularly the disparate reasoning in
Casio and India TV Independent News neither of which have taken into consideration
factors such as special changes in the law concerning trademark and copyright
violation, where jurisdiction has been differently provided for (which do not include
any factor relating to internet based activity); absence of any long arm statutes, of the
kind existing elsewhere in the world, and provisions of the Information Technology
Act, 2000, this Court is of the opinion that the issue of territorial jurisdiction in cases
concerning trademark and copyright infringement or related rights have to be
considered authoritatively by a Division Bench. This is of some importance, because
whenever Parliament wanted to redefine the issue of jurisdiction, it did so, in terms of
Section 134(2) of the Trade marks Act, 1999 and 62(2) of the Copyright Act, 1957- in
both instances omitting to provide for internet related amendments. Similarly,
Parliament prescribed, with specificity, in Sections 11, 12 and 13 of the IT Act, 2000
about origination and receipt of electronic records; it also provided for international or
universal jurisdiction, of Indian courts, by Section 75 of the IT Act. The court is of the
opinion that these questions need to be considered and settled authoritatively, by a
Division Bench. This is essential both to resolve the conflict in the approaches
indicated by the two decisions of the court, as also decide whether assumption of such
jurisdiction is feasible or justified, having regard to the existing state of law. Also, in
the event the court concludes that internet based activity or behavior can in some
circumstances, clothe this Court with jurisdiction, it would be appropriate to indicate
standards which can be applied with some constancy. The following questions are
accordingly referred for consideration of, and decision, by a Division Bench:
(1) Whether this Court can entertain the present suit, having regard to the
averments and documents, in the context of special provisions in to the
Trademark and Copyrights Act, which do not provide for exercise of
jurisdiction based on internet or web-presence of such alleged infringers, even
while making explicit departure from the general law as to territorial
jurisdiction;
(2) Whether the court can entertain the present suit, in the absence of a long
arm statute, having regard to the existing state of law, particularly Section 20,
CPC, and the impact, if, any of the Information Technology Act, 2000 on it;
(3) Applicable standards for entertaining a suit, based on use of a trademark
by a defendant, on its web site, or infringement or passing off of the plaintiff's
trademark, in such web site and the relevant criteria to entertain such suits;
(4) Applicable standards and criteria where the plaintiff relies exclusively on
"trap orders" or transactions, in relation to passing off, or trademark
infringement cases, as Constituting "use" or cause of action, as the case may
be.
34. The Registry is directed to place this order, and the files before the Hon'ble Chief
Justice, for constitution of an appropriate bench, to answer the above reference.
Ordered accordingly.

Manupatra Information Solutions Pvt. Ltd.

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