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Course : PGDIPR- 01

Vardhaman Mahaveer Open University,

Kota

Intellectual Property Rights

A general Introduction

Course Development Committee PGDIPR- 01 Chairman Prof. L. R. Gurjar Director (Academic) Vardhaman Mahaveer Open University, Kota Convener and Members Convener Dr. Yogesh Sharma, Asso. Professor Prof. H.B. Nanadwana Department of Law Director, SOCE Vardhaman Mahaveer Open University, Kota Vardhaman Mahaveer Open University, Kota External Members:

1. Prof. Satish C. Shastri 2. Prof. V.K. Sharma Dean, Faculty of law, MITS, Laxmangarh Deptt.of Law Sikar, and Ex. Dean, J.N.Vyas University, Jodhpur University of Rajasthan, Jaipur (Raj.) 3. Dr. M.L. Pitaliya 4. Prof. (Dr.) Shefali Yadav Ex. Dean, MDS University, Ajmer Professor & Dean - Law Principal, Govt. P.G.College, Chittorgarh (Raj.) Dr. Shakuntala Misra National Rehabilitation University, Lucknow 5. Dr Yogendra Srivastava, Asso. Prof. School of Law, Jagran Lakecity University, Bhopal Editing and Course Writing Editor: Dr. Yogesh Sharma Convener, Department of Law Vardhaman Mahaveer Open University, Kota Course Writer: Prof. ( Dr.) Shefali Yadav, Professor & Dean – Law, Dr. Shakuntala Misra National Rehabilitation University, Lucknow Academic and Administrative Management Prof. Vinay Kumar Pathak Vice-Chancellor Vardhaman Mahaveer Open University, Kota Prof. L.R. Gurjar Director (Academic) Vardhaman Mahaveer Open University, Kota Prof. Karan Singh Director (MP&D) Vardhaman Mahaveer Open University, Kota Prof. H.B. Nanadwana Director, SOCE Vardhaman Mahaveer Open University, Kota Course Material Production Prof. Karan Singh Director (MP&D) Vardhaman Mahaveer Open University, Kota Production 2015 ISBN- 978 - 81 - 8496 - 581 - 0 All right reserved no part of this book may be reproduced in any form by mimeograph or any other means, without permission in writing from the V.M. Open University, Kota. Printed and published on behalf of V.M. Open University, Kota by Director (Academic) Printed by….

Unit 1 Intellectual Property Rights

(Concept, Nature and Scope)

Objectives:

After going through this unit, you should be able to understand the concept, nature and scope of intellectual property rights which will give a comprehensive understanding of intellectual property rights. Structure:

1. 1 Introduction
2. 2 The Concept of Intellectual Property
3. 2. 1 Historical Basis
4. 2. 2 Conceptual Basis
5. 3 Scope of Intellectual Property Rights
6. 3. 1 Patents
7. 3. 2 Copyright
8. 3. 3 Industrial Design Law
9. 3. 4 Trademarks Rights Law
10. 3. 5 Geographic Indication
11. 3. 6 Trade Secrets
12. 4 Nature of Intellectual Property
13. 5 The Nature of Protectable Rights
14. 6 General Prospects of Intellectual Property Protection
15. 7 Summary
16. 8 Self-Assessment Test
17. 9 Further Readings

1.1 Introduction:

Property is very complex concept to understand. It can be divided into many ways: Movable-Immovable, Tangible-Non Tangible etc. The division of property as movable and immovable, if it is tangible, was known in Roman law and has been adopted by modern Civil Codes. However, “as a result of the

industrial revolution and the rapid development made in the fields of science, technology and culture, new kinds of property came into existence”. New rights and properties like patents, copyright and industrial designs, which came to be known as Intellectual Property Rights (IPRs) received attention due to their unique characteristics. Intellectual property is so broad that it has many aspects. It stands for groupings of rights which individually constitute distinct rights. However, its conception differs from time and it to time. It is subject to various influences. The change in information technology, market reality (globalization) and generality have affected the contents of intellectual property. For instance, in olden days because of religion creation of life, say plants or animals were not protected. Thus, defining IP is difficult as its conception changes. It is diverse, challenging and has application in own day today life. IP is a section of law which protects creations of the mind, and deals with intellectual creations. Is it a workable definition? It is also commonly said that one cannot patent or copyright ideas. Intellectual property, as a concept, “was originally designed to cover ownership of literary and artistic works, inventions (patents) and trademarks”. What is protected in intellectual property is the form of the work, the invention, the relationship between a symbol and a business. However, the concept of intellectual property now covers patents, trademarks, literary and artistic works, designs and models, trade names, neighboring rights, plant production rights, topographies of semi conductor products, databases, when protected by a sui generis right, unfair competition, geographical indications, trade secrets, etc. Those types of intellectual property have been characterized as “pieces of information which can be incorporated in tangible objects at the same time in an unlimited number of copies at different time and at different locations anywhere in the world”. In other words, intellectual property rights are intangible in nature, different from the objects they are embodied in. The property right is not in those copies but in the information which creates in them. In today’s world, the international dimension of intellectual property is of ever increasing importance for three compelling reasons. First, the composition of world trade is changing. Currently, commerce in intellectual property has become an even greater component of trade between nations. The value of information

1967 Art. 2(viii) provides that “intellectual property shall include rights relating to: **1) literary, artistic and scientific works:

2. performances of performing artists, phonograms and broadcasts;
3. inventions in all fields of human behavior;
4. scientific discoveries;
5. industrial designs;
6. trademarks, service marks, and commercial names and designations;
7. protection against unfair competition and all other rights resulting from intellectual activity in industrial scientific, literary or artistic fields”.** The areas mentioned under (1) belong to the copyright branch of intellectual property. The areas mentioned in (2) are usually called “neighboring rights”, i.e., rights neighboring on copyright. The areas mentioned under (3), (5) and (6) constitute the industrial property branch of IP. The areas mentioned may also be considered as belonging to that branch. The expression industrial property covers inventions and industrial designs. Simply stated, inventions are new solutions to technical problems, and industrial designs are aesthetic creations determining the appearance of industrial products. In addition, industrial property includes trademarks, service marks, commercial names and designations, including indications of source and appellations of origin, and protection against unfair competition. Hence the aspect of intellectual creations although existent is less prominent, but what counts here is that the object of industrial property typically consists of signs transmitting information to consumers, in particular, as regards products and services offered on the market, and that the protection is directed against unauthorized use of such signs which is likely to mislead consumers and misleading practices in general. Scientific discoveries are not the same as inventions. The general treaty on the international recording of scientific discoveries (1978) defines a scientific discovery as ‘the recognition of phenomena, properties or laws of the material universe not hitherto recognized and capable of verification’ [Art. 1(1) (i))]. Inventions are new solutions to specific technical problems. Such solutions must, naturally rely on the properties or laws of the materials universe /otherwise they could not be materially or ‘technically’ applied/, but those properties or laws need

not be ‘properties or laws’ not hitherto ‘recognized’. An invention puts to new use, to new technical use, the said properties or laws, whether they are recognized (“discovered”) simultaneously with making the invention or whether they were already recognized (“discovered”) before and independently from the invention. Industrial and cultural development may be favored by stimulating creative activity and facilitating the transfer of technology and the dissemination of literary and artistic works. In the Ethiopian legal system too, the protection of intellectual property rights is afforded at constitutional level. The FDRE Constitution recognizes that every Ethiopian citizen has the right to ownership of private property with certain restrictions. Article 40(2) defines private property as any tangible or intangible product which has value and is produced by the labour, creativity, enterprise or capital of an individual citizen, associations which enjoy juridical personality under the law. Thus, the constitution declares protection for every property whether it is tangible or intangible. That means protection is afforded equally for intellectual property rights as any other property since they are intangible products. It is difficult to determine what types of ownership we should allow for non-corporeal, intellectual objects, such as writings, inventions and secret business information. There are intellectual properties which are not products of the mind. For instance, all trademarks are not products of the mind. Trademarks creation does not necessarily require intellectual activity. The same holds true for geographic indication. They don’t require the work of the mind like patent and copyright. IP is a bundle of legal rights resulting from intellectual creativity in industrial, scientific, artistic and literary fields. This definition is from the point of view of rights. IP is legal protection accorded to works of the mind in distinction from manual work (result of physical labour). It is a legal protection accorded to incorporeal ownership. Regarding protection of IP rights, there were historical, philosophical and epistemological problems. Historically, reservation exists as to the protection of such rights as they don’t exhibit essential characteristics of property, i.e. material existence. They consider corporeal chattels only as propriety. For them property should be subject to appropriation/occupancy/. The other problem is related to problems of philosophy. They believed that human beings cannot be regarded as a

money, energy, ingenuity and time in conducting research and inventing a new machine, discover a new device or process is protected by the law of patents. The man who designs a new shape for a motor car or settee or designs a new pattern for textiles is also creative. He is protected by the law of designs. The man who writes a new song, or story, or the architect who designs a unique building are all creative. They on their part are protected by the law of copyright. Intellectual property rights include copyright, patent, trademark, geographic indication of origin, industrial design, trade secrets, database protection laws, publicity rights laws, laws for the protection of plant varieties, laws for the protection of semiconductor chips (which store information for later retrieval), etc. There is a conventional mode of classification of intellectual property as industrial property and copyrights. Industrial properties include inventions (patent), property interest on minor invention (Utility model certificate) and commercial interests (Trade Marks, trade names, geographical indications, and industrial design), plant breeder rights, biodiversity, etc. Thus Intellectual Property is Knowledge, creative ideas, or expressions of human mind that have commercial value and are protectable under copyright, patent, service mark, trademark, or trade secret laws from imitation, infringement, and dilution. Inellectual property includes brand names, discoveries, formulas, inventions, knowledge, registered designs, software registered designs, software, and works of artistic, literary, or musical nature. It is one of the most readily tradable properties in the digital marketplace. 1

1.3.1 Patents

A patent is a type of intellectual property right which allows the holder of the right to exclusively make use of and sale an invention when one develops an invention. Invention is a new process, machine, manufacture, composition of matter. It is not an obvious derivation of the prior art (It should involve an inventive step). A person who has got a patent right has an exclusive right. The exclusive right is a true monopoly but its grant involves an administrative process.

1.3.2 Copyright

(^1) http://www.businessdictionary.com/definition/intellectual-property.

It is an intellectual property which does not essentially grant an exclusive right over an idea but the expressions of ideas which makes if different from patent law. Patent is related with invention technical solution to technical problems. Copyright is a field which has gone with artistic, literary creativity, creativity in scientific works, audiovisual works, musical works, software and others. There are neighboring rights. These are different from copyright but related with it – performers in a theatre, dancers, actors, broadcasters, producers of sound recorders, etc. It protects not ideas but expressions of ideas as opposed to patent. Copyright protects original expression of ideas, the ways the works are done; the language used, etc. It applies for all copyrightable works. Copyright lasts for a longer period of time. The practice is life of author plus 50 years after his/her life. Administrative procedures are not required, unlike patent laws, in most laws but in America depositing the work was necessary and was certified thereon but now it is abolished.

1.3.3 Industrial Design Law

Some call this design right (European) and some call it patentable design, industrial design (WIPO and other international organization). A design is a kind of intellectual property which gives an exclusive right to a person who has created a novel appearance of a product. It deals with appearance: how they look like. Appearance is important because consumers are interested in the outer appearance of a product. It is exclusively concerned with appearance, not quality. The principles which have been utilized in developing industrial design law are from experiences of patent and copyright laws. It shares copyright laws because the design is artistic. It shares patent law because there are scientific considerations. Design law subsists in a work upon registration and communication. It makes them close to patent law since they are also founded in patent law. Duration is most of the time 20 years like the patent law trademark Rights law.

1.3.4 Trademarks Rights Law

It is a regime of the law giving protection to graphic representation to words or logos or depending on the jurisdiction question such as sound or smells which are distinctive in nature and serve as source identification. There is also a recent

1.4 Nature of Intellectual Property

Intellectual properties have their own peculiar features. These features of intellectual properties may serve to identify intellectual properties from other types of properties. It is pertinent to take a brief look at their common features. In other words, in spite of the different branches, intellectual property has some common characteristics that distinguish them from other rights. For instance, Intellectual property rights are, naturally, proprietary in nature. They can be bought and sold, mortgaged and licensed just like any other type of property. A valuation can be put on them for contractual or accounting purposes. Nevertheless, it is very important to be able to distinguish between the property rights which exist in a tangible item and the intangible intellectual property rights which may be embodied in that item. For example, if ‘A’ writes a letter to ‘B’, the piece of paper received by ‘B’ will belong to ‘B’ as it was intended as a gift by the sender. However, the copyright in the words contained in the letter will belong to the creator, ‘A’. Further, ‘A’ may use a pen to write the letter. The pen will be ‘A’s personal property, but there may well be a patent for the pen belonging to ‘C’ Ltd, or perhaps, if the pen is of an unusual shape, ‘C’ Ltd might own a design right in respect of the pen. The fact that there are intellectual property rights over the pen does not prevent the use or ownership of the tangible item by ‘A’, just as ‘A’s ownership of copyright in the letter does not affect ‘B’s ownership of the piece of paper on which the letter is written. Other characteristics are stated below:

1. Territorial

Any intellectual property issued should be resolved by national laws. Why is it an issue? Because intellectual property rights have one characteristic which other national rights do not have. In ownership of intellectual property of immovable properties, issues of cross borders are not probable. But in intellectual properties, it is common. A film made in Hollywood can be seen in other countries. The market is not only the local one but also international. If a design in China is imitated by another person in France which law would be applicable? One of the basic characteristics of intellectual property since it is a creation of statutes; is that it is confined to the territory where it is created even though the importance transcends national boundaries. It is as a result of this recognition that

intellectual property conventions provides for protection of intellectual property which carries out wide variety of activities and services that includes establishment international standard for intellectual property laws and practices and providing registration services that allow patents, trademarks and designs to be protected in many countries. All this is made possible by way of implementing international treaties that defines internationally agreed basic standards of intellectual property protection in each country. However, the territorial nature of intellectual property laws remains an attribute because membership of such world bodies is still at the discretion of member states. So, what is protected in one country may not be protected in another.

2. Giving an exclusive right to the owner

It means others, who are not owners, are prohibited from using the right. Most intellectual property rights cannot be implemented in practice as soon as the owner got exclusive rights. Most of them need to be tested by some public laws. The creator or author of an intellectual property enjoys rights inherent in his work to the exclusion of anybody else.

3. Assignable

Since they are rights, they can obviously be assigned (licensed). It is possible to put a dichotomy between intellectual property rights and the material object in which the work is embodied. Intellectual property can be bought, sold, or licensed or hired or attached.

4. Independence

Different intellectual property rights subsist in the same kind of object. Most intellectual property rights are likely to be embodied in objects.

5. Subject to Public Policy

They are vulnerable to the deep embodiment of public policy. Intellectual property attempts to preserve and find adequate reconciliation between two competing interests. On the one hand, the intellectual property rights holders require adequate remuneration and on the other hand, consumers try to consume works without much inconvenience. Is limitation unique for intellectual property?

6. Divisible (Fragmentation)

the tangible properties, it can be subject to ownership, it can be protected from invasion, it can be assigned or leased but it cannot be taken into physical possession and can only be realized through an action in court. Justice Holmes of U.S. Supreme Court assessing the unique character of copyright as a property was quoted to have said: “The notion of property starts, I suppose, from confirmed possession of tangible object... but in copyright, property had reached a more abstract expression. The right to exclude is not directed to an object in possession or owned, but is now in vacua, so as to speak. It restrains the spontaneity of men, where, but for it; there would be nothing as they saw fit. It’s a prohibition of conduct remote from the persons or tangible about the party having the right. It may be infringed by a thousand miles from the owner and without his ever becoming aware of the wrong.” The above does not however mean that all the rights are held as property, there are non-proprietary rights which are also protected by intellectual property law. Confidential information and the law of passing off are handy examples of these categories of rights. The consequence of the above categorisation of intellectual rights as property is that it confers on the owner or producer exclusive rights that can be assigned, licensed, mortgaged and bequeathed. In other words, the creator of an idea and manufacturer of its embodiment, if different person, have interest in gaining rewards for their efforts and expenditure and in making profit from the enterprise. This is only possible if there is protection of such ideas against the risk of imitation. Intellectual property law provides steps in that protection and hence it comprises a discrete body of rights which applied to many forms in which human intellect manifests or expresses itself. The common feature that lies behind each intellectual property law is that they seek to confer owners the right to stop others from taking their creations. This preserves to a reasonable extend, the integrity of, and reserves the exploitation and representation of such creations for the right owners. It is however necessary to lastly add that although intellectual property rights owners have natural rights to their creations, and interest in just reward, the public also has interest in access to, and use of intellectual property and hence a balance most be stricken in - between such interests. In other words, this study will attempt to

analyse what risk this protection may engender and on whom the outcome will affect worst.

1.6 General Prospects of Intellectual Property Protection

Intellectual Property protection generally play an important role in industrialization and the various rights protected have since become key factors in modern world of international trade and market-oriented economies. Patents protection ensures fair practices among competitors by protecting individuals whose commercial well – being, moral right and intellectual integrity must be realized as necessary indices before any improvement of standard of living can be claimed. Patents protection also helps economies to establish, in consideration of available natural and human resources, their area of comparative advantage over other competing economies. A resultant increase from this is not only on the per capita net of the national income but also in real income per head. Patents also encourage investment which in turn galvanizes the wheels of development. Trademarks encourage investment especially in the manufacturing industry. This is only possible where there are institutional measures put in place to ensure and assure investors that their trademarks or goods cannot be traded with nor falsified by another competitor. This inspires a sense of security in the investor (Note 120). An empirical study for the LDC’s (less developed countries) confirm a positive relationship between investment and the growth of GDP (Gross Domestic Product). Moreover, trademarks are cipher around which investment in the promotion of a product is built and that investment is a valuable that deserves protection as such, even when there is no abuse arising from misrepresentations either about origin or quality. As a focal point of economic development, trademarks when protected, are one way of encouraging entrepreneurial talent especially in the private sector and enhancing creativity and productivity and leads to economic emancipation both for the individual and the nation at large, this can help raise leaders of quality with the right attitude in ranks of government and help increase the per capita standard of living. This is because there is a close relationship between productivity and real income per worker and since a nation must produce a more goods and services per worker to enjoy more goods and services which means a limited domestic market lack of demand for most non-agricultural goods,

technologies of the semiconductor chip, computer software and biotechnology. IP law aims at safeguarding creators and other producers of intellectual goods and services by granting them certain time limited rights to control the use made of those productions. These rights do not apply to the physical object in which the creation may be embodied but instead to the intellectual creation as such. It is obvious from the discussion above that Intellectual Property regimes are generally complex arrangements that seek to satisfy interests which are tripartite in nature. On one hand, it strives to satisfy the inventor or the owner by providing adequate protection for his work or invention and conferring on him absolute right to exclude others from making unauthorized benefit from it. It is this right that permits the owner to take action against any person exploiting his invention without agreement. This is primarily because, as we have seen in the discussion above, the right allows him to derive material benefits to which he is entitled to as reward for his intellectual efforts and work and a times as compensation for the expenses which his research and experimentation leading to the invention had entailed. Secondly, it aims at ensuring that nations stand to benefit immensely by waxing stronger in the global economy as a result of the intellectual wealth of their nationals. In other words, while the individual right to his work or invention is guaranteed, the industrial and technological base of the nation is also assured. There is no doubt that the rat race for development in industry and technology as a result of globalization affects and is affected by intellectual property; a country’s economic and social development nowadays is directly hinged on the strength of its intellectual property protection. After all, encouragement of intellectual creation is one of the basic perquisites of all social, economic and cultural development. This explains the various national laws and the general interest of nations especially developing ones, in harnessing as much as possible the economic rewards of the intellectual activism of their nationals. Then on the last end of the tripartite structure stands the ultimate consumer, whose interest too would have to be taken in to consideration especially as the use of, and the protection of inventions and creations, is a key means of ensuring better and more enriching life for instance, the Patent system that does not respect and balance the need of the creators and consumers is likely to deny the later some essential resources and services. So, striking a balance between and among these

various interests has been the major preoccupation of the intellectual property regimes.

1.8 Self-Assessment Test

1. Discuss the concept of intellectual property with relevant examples.
2. What do you mean by the term “intellectual property rights”? Describe its scope.
3. What is the nature of intellectual property? Discuss.
4. What is nature of protectable rights under the intellectual property rights? What is the difference between the nature of intellectual property and protectable rights under it?
5. Give a brief account of the prospects of protection of intellectual property.

1.9 Further Readings

1. Cornish, W. R., Intellectual Property: Patents, Copyrights, Trademarks and Allied Rights, 4th ed. (London: Sweet & Maxwell, 1999)
2. Intellectual Property Law Journals
3. WIPO Intellectual Property Handbook, (2004); WIPO Intellectual Property Law: Introductory notes; WIPO Intellectual Property Handbook: Law, Policy & Use. (2004).