Standard Corporation India Ltd. v. Tractors and Farm Equipment Ltd- the copyright-design conundrum


(This post has been co-authored with Aparajitha)

Earlier this month, the Madras High Court heard the matter of Standard Corporation India Ltd. v. Tractors and Farm Equipment Ltd, an appeal on an order passed in 2012 in a civil suit that dealt with copyright and design law. The respondent (plaintiff in the original civil suit) had contended that the appellant was slavishly imitating the tractors manufactured by it, thereby infringing on their copyright in the artistic work in the drawing for its tractors. The appellant had filed an application praying for the dismissal of the civil suit on the grounds that  it was not maintainable under S. 15(2), Copyright Act. The appellant contended that under S. 15(2), the copyright in any work capable of being registered as a design and which had not been registered, would cease as soon as any article to which it applies has been reproduced more than 50 times. In this case, the drawings in which the copyright was claimed had been used more than 100 times prior to the filing of this suit. In this regard, the appellant cited the case of MICROFIBRES INC. Vs. GIRDHAR & CO., (2009 (40) PTC 519 (Del.) (DB) which had held that “…In the original work of art, copyright would exist and the author/holder would continue enjoying the longer protection granted under the Copyright Act in respect of the original artistic work.” If a design is created from such original work and if it ” is registered under the Designs Act, the design would lose its copyright protection under the Copyright Act but not the original work If it is a design registrable under the Designs Act but has not so been registered, the Design would continue to enjoy copyright protection under the Act so long as the threshold limit of its application on an article by an industrial process for more than 50 times is reached. But once that limit is crossed, it would lose its copyright protection under the Copyright Act. This interpretation, in our view, would harmonize the Copyright and the Designs Act in accordance with the legislative intent.

The respondent, on the other hand, while agreeing with the ruling in Microfibres argued that it was inapplicable in the instant case as the drawings could not be registered as a design. They argued that there was no doubt that “a design, which is functional in nature and has certain functional features” could not be registered as a design. S. 2(d), Designs Act, 2000 also specifically excludes any artistic work as defined in S.2(c), Copyright Act from being registered as a design.

The Division Bench ruled that the appellant had not shown sufficient cause or reason to interfere with the findings of the learned single judge that the suit could not be dismissed as it was not barred by law and as there were triable issues existing for the consideration of the Court. The Division Bench stated  “A right existing in a person or an entity to seek certain reliefs before a Court of law, when disputes had arisen, cannot be curbed, at the outset, without having proper reasons to do so. As there are triable issues, which are to be decided in the civil suit, in C.S.No.602 of 2007, we are of the considered view that the present original side appeal is liable to fail.” Consequently, the Division Bench dismissed the appeal.

The anomalous relation between Copyright and Design

On one hand, concerns have been raised with regard to the problem of overlapping IP rights i.e. two IP regimes protecting the same subject matter (e.g. copyright and patent protection for software). While on the other hand, as in the present case of Copyright and Design, not only is overlapping prevented but creators are stripped off both sets of rights, as explained by Shamnad and Mr. Wilkof in their recent book ‘Overlapping Intellectual Property Rights’. In this case, since the tractor design was not registered as a ‘design’, design protection is lost. At the same time, copyright protection also ceases since the work was industrially produced more than 50 times. The situation is further complicated with S 2(d) of the Design Act, 2000 which excludes artistic works from the definition of a ‘design’. This means that no artistic work could ever qualify as a design.

The single judge as well as the Division Bench in the Microfibers case was alive to these problems. The single judge’s solution was hinged on “intention” i.e. a work created for industrial application would not qualify as an artistic work under the Copyright Act. However, the Division Bench did away with the intentionality requirement.  Instead, the Division Bench suggested that while copyright in the applied design extinguished on reproduction of 50 pieces, copyright continued to exist for the underlying drawing. However, this interpretation does not solve the legislative anomaly of s. 2(d) of the Design Act, 2000.

In their book, Shamnad and Mr. Wilkof ask us to rethink the rationale behind design protection for artistic works. If artistic works are protected under copyright law what is the need for a separate design protection? If the concern is that industrially applied works should not receive more than 15 years of protection, a differential protection regime can be introduced in the Copyright Act itself. They urge for legislative change and reasons that the anomaly can be cured by a simple amendment to the Copyright Act: an artistic work produced industrially more than 50 times will be granted 15 year protection and not life + 60 years.

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