WWE Loses Delhi Round!
To restrict forum shopping by trademark and copyright owners, the Trademark and Copyright Acts require business presence in the jurisdiction where the infringement action is brought. But this requirement of business presence is a tricky criteria to fulfill in the world of e-commerce. Recently, World Wrestling Entertainment failed to establish that presence in Delhi. Payaswini Upadhyay asks experts what WWE’s failure means for jurisdiction issues in future infringement cases.
Worldwide Wrestling Entertainment or WWE – a US based company- has a copyright and trademark on the WWE logo, its talent names and slogans. It noticed that Mumbai based Reshma Collection was infringing on its trademarks and copyright by using WWE logo and talent names on garments, apparel etc.
And so, WWE brought a copyright and trademark infringement case against Reshma Collection in the Delhi HC. It could have filed a case in Bombay- where Reshma Collection was based- but it chose not to. Experts say it could be because Delhi is a favored jurisdiction for such suits.
Managing Partner, SNA
"Mumbai High Court does not normally grant ex-parte orders of injunction. If they would’ve gone to the Mumbai High Court, the notice of motion would have been served on the defendant who would’ve replied 2-3 weeks later. The matter would’ve come up 3 weeks later and then it would’ve been heard on merits for injunction. What the petitioners seemed to have attempted here is invoke the jurisdiction of Delhi HC and get an ex parte order of injunction."
And here's where the Delhi High Court has laid down an important principle.
The Trademark and Copyright Act allow a party to bring a suit at a place where the plaintiff- trademark or copyright owner- resides or carries on business.
WWE argued that Delhi should be considered a place where it is carrying on business based on 3 grounds
1. It broadcasts its programmes in Delhi;
2. Its merchandise being available for sale in Delhi; and
3. The merchandise is available on its website which is accessible in Delhi.
But the Delhi HC disagreed with the argument and pointed that merely because a transaction is taking place over a more advanced medium, the conventional test of carrying on business cannot be done away with. And since WWE had no branch office or exclusive agent in Delhi, the court will not have jurisdiction
Managing Partner, SNA
“There was a bit of confusion when it comes to doing business through internet. So when you have a law laid down like this and until it is challenged and reversed by a higher court, it clarifies the position very significantly. What happens is all over the world, forum shopping has been a bit of a problem for courts- people could choose a jurisdiction which is particularly inconvenient for the defendant and get injunctions and then injunctions take years to get vacated and the party’s interest could be seriously prejudiced. I won’t say there was forum shopping here but a good proposition of law has been examined by Delhi HC.”
Partner, Advani & Co.
“Normally, this would not be a problem for Indian e-commerce companies because they would either have a registered office or carrying on business in a State High Court’s jurisdiction. However if you look at it from the perspective of a foreign company which is filing an infringement suit, then it needs to go down to the location where the defendant is located to satisfy the jurisdictional test. In a sense, its options are fairly limited. Secondly, this judgment goes towards showing how more and more retail as its shifting online still has to intersect with the traditional rules of law. For instance the court is stating the e-commerce company needs to have a physical warehouse or appoint an agent in the local territory of a High Court for that jurisdiction to arise. I would say this is good opportunity to look closely at the law and to engage in a policy debate as well as suggest amendments.”
And that is the limited precedent value of this ruling that even after businesses have evolved and moved to e commerce platform, they still need to meet the conventional business presence test to invoke a court’s jurisdiction in infringement cases.
In Mumbai, Payaswini Upadhyay