Law

Intellectual Property
Nature of Remedies in Intellectual Property Law
Role Name Affiliation

Principal Investigator Professor (Dr.) Ranbir Singh Vice Chancellor, National

Law University, Delhi
Paper Coordinator Mr. Yogesh Pai Assistant Professor of
Law, National Law
University, Delhi
Content Writer (CW) Anath Padmanabhan Advocate, Madras High
Court
Content Reviewer (CR) Yogesh Pai National Law University,
Delhi

Development Team
Module Detail
Subject name Law

Paper name Intellectual Property

Module name/ Title Nature of Remedies in IP Law

Module Id Law/IP/# 38

Pre- requisites Intellectual property law, property concept, infringement, rights

Objectives • To examine the nature of remedies in intellectual

property law
Key words Infringement and remedies, injunctive relief, accounts for profit,
damages, four factor test

Introduction:

2
The nature of legal remedies in “intellectual property law” derives content
and character from the most important word there: property. Property
signifies the right to exclude. Therefore, the remedies granted should also be
of the kind that provide teeth to this right to exclude, and strengthen the
exclusivity conferred by law on the owner of the intellectual property. In this
module, we will cover the most important of such remedies, injunctions, and
two others that ensue as a direct consequence of the “property” character of
intellectual property rights, ie. Anton Piller orders and exemplary damages.
Criminal remedies are discussed in separate modules pertaining to remedies
for infringement of separate IPRs, and so are the nuances of civil remedies for
each of them such as who may sue, who may be sued, the nature of pleadings
etc.
Learning Objectives
To understand the nature of remedies in
intellectual property law.
To examine how equitable relief is provided under
civil and criminal procedure code.
To examine the type of injunctions that can be
issued in the context of Indian civil procedure.
To understand different types of injunctive orders
issued by courts in the context of IPRs- Anton Piller,
Mareva, temporary and ex-parte orders.
To understand how alternative relief is provided in
the context of Indian IP law, including accounts for
profits or damages.

3
PART I

Injunctions

An injunction is an equitable remedy in the form of a judicial order, whereby

a party is required to do, or to refrain from doing, certain acts. The
consequence of failure to adhere to, or comply with, the order of injunction,
results in the party in default inviting on himself civil consequences, or even
criminal penalties in certain situations.
In India, injunctions are available under both civil and criminal law. While
Section 133, 142 and 144 of the Code of Criminal Procedure, 1973, deal with
injunctions in criminal proceedings, Order XXXIX Rules 1 to 5 of the CPC
read with Chapters 7 and 8 of the Specific Relief Act, 1963, deal primarily
with injunctions in civil proceedings.

4
Civil remedies for enforcement of intellectual property rights (IPRs) in India
mainly revolve around the grant of preventive injunctions restraining
infringers from continuing their infringing acts / conduct. When a company
or individual discovers that its IPRs are about to be infringed, or are being
infringed, it has two judicial remedies i.e. (i) sue the infringer for damages,
and (ii) when the infringement has already commenced, apply for a perpetual
injunction restraining the infringing defendant from carrying on with the act
of infringement. In both situations, the owner of the right may also pray for
declaratory relief declaring that the intellectual property right in question
vests with him. These are the final reliefs sought in the suit, and the award of
each or all of them arise only upon completion of trial. In the meantime, the
plaintiff cannot be left without remedy, and forced to be a mute spectator to
infringing conduct. It is here that Order XXXIX of the CPC kicks in to protect
the interests of the right owner by way of an interim injunction.

Temporary and Perpetual Injunctions

As already stated above, temporary injunctions are granted during the
pendency of the suit to protect the interests of the parties. The difference
between these injunctions, also known as interim injunctions, and perpetual
injunctions, is made clear in Section 37 of the Specific Relief Act, 1963
(hereinafter the “S.R.A”) which reads as follows:
37. Temporary and perpetual injunctions.- (1) Temporary injunctions are such as
are to continue until a specified time, or until the further order of the court, and they
may be granted at any stage of a suit, and are regulated by the Code of Civil
Procedure, 1908 (5 of 1908).
(2) A perpetual injunction can only be granted by the decree made at the hearing and
upon the merits of the suit; the defendant is thereby perpetually enjoined from the
assertion of a right, or from the commission of an act, which would be contrary to the
rights of the plaintiff.

5
Thus, all rules applicable to the passing of a decree shall apply to an order of
perpetual injunction but not to one of temporary injunction. The grant of a
temporary injunction is on the other hand regulated by Order XXXIX, Rules 1
to 5 of the CPC.
The Agreement on Trade-Related Aspects of Intellectual Property Rights, 1994
(TRIPS), to which India is a signatory, makes a clear distinction between
general civil enforcement measures and provisional measures such as
temporary injunctions and Anton Piller orders, discussed below. Article 50 of
TRIPS deals with provisional measures and provides for (i) temporary
injunctions “to prevent an infringement of any intellectual property right
from occurring, and in particular to prevent the entry into the channels of
commerce in their jurisdiction of goods, including imported goods
immediately after customs clearance”, (ii) Anton Piller orders “to preserve
relevant evidence in regard to the alleged infringement”, and (iii) ex parte
injunctions “where appropriate, in particular where any delay is likely to
cause irreparable harm to the right holder, or where there is a demonstrable
risk of evidence being destroyed.”

Mandatory and Prohibitory Injunctions

By an order of injunction, if the Court were to prohibit or restrain the
commission or continuance of some wrongful act, it is a prohibitory
injunction. On the other hand, if the Court were to direct the doing of a
positive act to rectify some omission or the restoration of the prior position
(status quo ante) by undoing some wrongful act, as observed in State of
Haryana v State of Punjab, 1 it is a mandatory injunction. In this regard, Section
39 of the S.R.A. reads as follows:
39. Mandatory injunctions – When, to prevent the breach of an obligation, it is
necessary to compel the performance of certain acts which the court is capable of

1
2004 (12) SCC 673.

6
enforcing, the court may in its discretion grant an injunction to prevent the breach
complained of, and also to compel performance of the requisite acts.

When this provision is read along with Section 38(1) of the S.R.A., it is clear
that mandatory injunctions are intended to support an order of perpetual
injunction, in situations where breach of an obligation cannot be prevented
without compelling the performance of certain acts.

Mandatory Injunction – Considerations

A mandatory injunction is granted only in exceptional cases of extreme
hardship, and instances where such an injunction is granted by means of an
ad interim ex parte order pending decision on the injunction application itself
are virtually unknown.2 Generally, a mandatory injunction is granted only to
restore the status quo and not to establish a new state of affairs differing from
that which existed when the suit was instituted. However, in Indian Cable
Company Limited v Smt. Sumitra Chakraborty,3 it was held that an order of
mandatory injunction can be granted to bring about a state of affairs which
should have, in law, existed on the date of initiation of the suit, but for the
wrongful act of the defendant of altering such state of affairs. Following this,
in Vijay Srivastava v Mirahul Enterprises,4 it was held that there is no bar on the
courts granting interlocutory relief in the mandatory form though in doing so,
one should act with greatest circumspection and only in rare and exceptional
cases. Whether a case is fit to be categorised as rare and exceptional would in
turn depend on the facts and circumstances of that case.
Keeping in mind the complications surrounding the grant of a mandatory
injunction, the Supreme Court in D.C.Warden v C.S.Warden5 has held that the
plaintiff should establish a strong case for trial to obtain a mandatory

2
Naadan Pictures Ltd. v Art Pictures Ltd., AIR 1956 Cal 428.
3
AIR 1985 Cal 248.
4
AIR 1988 Delhi 140.
5
1990 (2) SCC 117.

7
injunction; a standard higher than the normal prima facie case standard
required for grant of a prohibitory injunction. After a review of the various
decisions on this point, the Calcutta High Court in Indian Cables v Sumitra
Chakraborty,6 has held that if a court is called upon to grant any relief on any
interlocutory application which when granted would mean granting
substantially the relief claimed in the suit, it will be very slow and
circumspect in the matter of granting any such prayer since such a relief
should be granted only in exceptional cases. All the same, there is no absolute
legal bar to the court granting such a relief.

Quia Timet Injunctions

Any injunction sought for to prevent situations where the illegality or breach
of obligation has not occurred yet but is on the verge of occurring, is known
as a quia timet injunction.7 The applicant has to show reasonable apprehension
that the illegality is on the verge of occurring, and will most certainly happen
unless there is intervention by the Court, by way of granting an order of
injunction. As observed in Kerr on Injunctions in connection with the
threatened invasion of a right, “the mere prospect or apprehension of injury or the
mere belief that the act complained of may, or will, be done is not sufficient; but if an
intention to do the act complained of can be shown to exist, or if a man insists on his
right to do, or begins to do, or threatens to do, or gives notice of his intention to do, an
act which must, in the opinion of the Court, if completed, give a ground of action,
there is a foundation for the exercise of the jurisdiction.”8 In Super Cassette
Industries Ltd. v Myspace Inc.,9 when faced with a submission that quia timet

6
AIR 1985 Cal 248.
7
Mars Incorporated v Kumar Krishna Mukerjee, 2003 (26) PTC 60 : Quia Timet is actually a Latin
word which means "because he fears or apprehends". In legal terminology it has been defined in
Osborne's Concise Law Dictionary (London: Sweet and Maxwell, 8th edn. 1993, Bone and Rutherford)
as an action by which a person may obtain an injunction to prevent or restrain some threatened act
being done which, if done, would cause him substantial damage, and for which money would be no
adequate or sufficient remedy.
8
Purshottamdas Parbhudas Patel v Bai Dahi, AIR 1940 Bom 205.
9
MIPR 2011 (2) 303.

8
actions should be confined to instances of trade mark infringement and not
extended to copyright infringement suits, the Court held that the principle of
quia timet is applicable to any tortuous liability wherever there is an
apprehension of infringement that is likely to happen. The remedy by way of
temporary injunction being preventive in nature, it is not necessary that a
wrong should have been actually committed before the Court will interfere.
The only issue for the Court to consider is whether the two necessary
ingredients for a quia timet action are satisfied, namely i) proof of imminent
danger even if there is no actual damage, and ii) proof that the apprehended
damage will, if it comes, be very substantial.

Mareva Injunctions
Mareva injunctions are restraint orders “freezing” the assets of the defendant,
and can be issued even if the property or the person concerned is outside the
jurisdiction of the court.10 However, in Popular Jute Exchange Limited v
Murlidhar Ratanlal Exports Ltd.,11 the Calcutta High Court has held that one of
the basic criteria for the grant of Mareva injunction is that the assets must be
located within the jurisdiction to confer jurisdiction on the Court to grant this
remedy. This seems to be the correct view, and the passing observation by the
Supreme Court that such orders would apply even if the property or the
person concerned were to be outside the jurisdiction of the court must be
confined to situations where the defendant is outside the court’s jurisdiction
but with assets within such jurisdiction.
Such orders derive their nomenclature from the decision of the Court of
Appeals in Mareva Compania Naviera SA v International Bulkcarriers SA.12
10
Mohit Bhargava v Bharat Bhushan Bhargava, (2007) 4 SCC 795.
11
2006 (4) CHN 381.
12
[1975] 2 Lloyd's Rep 509 : [1980] 1 All E.R. 213. In French law such orders are known as saisie
conservatoire which literally means a ‘conservative seizure’ or ‘a seizure of assets so as to conserve
them for the creditor in case he should afterwards get judgment.’

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Though the Court restrains the defendant from dissipating his assets, there is
no security interest created by way of these orders on the property. Once
granted, a Mareva injunction has immediate effect on every asset of the
defendant covered by the injunction, because it is a method of attachment,
which operates in rem in the same manner as the arrest of a ship and because
any authority which third parties may have to deal with the asset in
accordance with the instructions of the defendant is revoked once such third
parties have notice of the injunction.13
A freezing order of the above kind will usually only be made where the
claimant can show that there was at least a good arguable case that they
would succeed at trial and that the refusal of an injunction would involve a
real risk that a judgment or award in their favour would remain unsatisfied. 14
A Mareva injunction should not be granted where the removal of the assets is
in the ordinary course of the defendant’s business, but only where the
intention behind such removal is to make himself judgment proof. 15 In Rite
Approach Group Ltd. v Rosoboronexport,16 the Delhi High Court has held that
freezing injunction should not be granted unless in exceptional circumstances,
upon a showing that a person has a legal or equitable right, a debt is due and
owed, and there is danger that the debtor may dispose of his assets before the
judgment is passed so as to defeat the decree which may be passed. There
must be evidence or material to show that the debtor is acting in a manner, or
is likely to act in a manner, that frustrates enforcement of any subsequent
order/decree of the court or tribunal. The most common application of such
orders is in situations where there is a foreign defendant with property /
assets within the court’s jurisdiction, and it is apprehended that he may deal
with them, whether by removal out of the jurisdiction or disposing of them

13
Z Ltd. v A [1982] 1 All E.R. 556.
14
Ninemia Maritime corporation v Trave Schiffahrtgesellschaft m.b.H und Co.K.G [1983] 1 W.L.R.
1412.
15
Iridium India Telecom Limited v Motorola Inc., 2003 (6) Bom. C.R. 511.
16
MANU/DE/9772/2007.

10
within the jurisdiction, so that they are not available or traceable when the
judgment is given against him.

Perpetual Injunctions
Section 38(1) makes it clear that a perpetual injunction may be granted to the
plaintiff to prevent the breach of an obligation existing in his favour, whether
expressly or by implication. Obligation is defined widely in Section 2(a) of the
S.R.A. to include every duty enforceable by law. It may arise from contract, or
may be in the nature of a trust, or an obligation, the breach of which amounts
to a tort or civil wrong, or any other legal obligation.
Though there are certain situations where perpetual injunction will not be
granted, most instances of infringement of IPRs attract the grant of a
perpetual injunction to restrain the defendant from carrying on such
infringement. Indeed, without such grant, the exclusivity associated with
these rights would be rendered redundant. The exceptions to the grant of a
perpetual injunction arise in cases where the dispute is essentially contractual.
In the context of IPRs, this could be the case where the owner and the licensee
are engaged in a legal battle ensuing out of violation of the license terms by
the licensee. Though this too is a case of infringement, the Court may
eventually refrain from granting an injunction, instead directing the licensee
to compensate the IPR owner through the payment of damages.

Temporary Injunctions
Order XXXIX, Rules 1 and 2 of the Code of Civil Procedure, 1908 provide for
when temporary injunctions can be granted by the Court.
Rule 1. Cases in which temporary injunction may be granted
Where in any suit it is proved by affidavit or otherwise--
(a) that any property in dispute in a suit is in danger of being wasted, damaged or
alienated by any party to the suit, or wrongfully sold in execution of a decree, or

11
(b) that the defendant threatens, or intends, to remove or dispose of his property with
a view to defrauding his creditors,
(c) that the defendant threatens to dispossess, the plaintiff or otherwise cause injury
to the plaintiff in relation to any property in dispute in the suit,
the court may by order grant a temporary injunction to restrain such act, or make
such other order for the purpose of staying and preventing the wasting, damaging,
alienation, sale, removal or disposition of the property or dispossession of the plaintiff,
or otherwise causing injury to the plaintiff in relation to any property in dispute in
the suit as the Court thinks fit, until the disposal of the suit or until further orders.

Rule 2. Injunction to restrain repetition or continuance of breach

(1) In any suit for restraining the defendant from committing a breach of contract or
other injury of any kind, whether compensation is claimed in the suit or not, the
plaintiff may, at any time after the commencement of the suit, and either before or
after judgment, apply to the Court for a temporary injunction to restrain the
defendant from committing the breach of contract or injury complained of, or any
breach of contract or injury of a like kind arising out of the same contract or relating
to the same property or right.
(2) The Court may by order grant such injunction, on such terms as to the duration
of the injunction, keeping an account, giving security, or otherwise, as the Court
thinks fit.

These provisions are not however the sole repository of the Court’s power to
grant an injunction. Section 151 of the CPC, which deals with inherent powers
of the Court, also authorizes it to grant injunction in cases that are not covered
by these Rules.17 While adjudicating on an application filed by the plaintiff for
an interim injunction, the court will have to exercise its discretion keeping in
mind three main aspects of the case put forth by the plaintiff. These are (i)
prima facie case, which in an IPR infringement context translates to whether

17
Tanusree Basu v Ishani Prasad Basu, (2008) 4 SCC 791.

12
the plaintiff has a valid ownership right in the IPR and is able to establish
infringing conduct on the part of the defendant on a plain reading of the
plaint and perusal of plaint documents; (ii) whether the plaintiff can establish
balance of convenience in its favour; and (iii) whether irreparable loss may be
caused to the plaintiff, if the court does not grant an order of interim
injunction. Since trial is a long drawn process in our legal system, the view
taken by the Court on grant or otherwise of an ad interim injunction can go a
long way in charting the future course of action of the disputants.
In United Commercial Bank v Bank of India,18 Supreme Court has held that prima
facie case requires a showing of a bona fide contention between the parties or a
serious question to be tried. The High Court of Andhra Pradesh has explained
the other two prongs, balance of convenience and irreparable hardship, in
Shri Kashi Math Samsthan v Srimad Sudhindra Thirtha Swami,19as follows:
The inconvenience of the applicant if temporary injunction is refused will be balanced
and compared with that of the other party, if it is granted. If the scales of
inconvenience lean to the side of the applicant, then only interlocutory injunction
should be granted. Irreparable injury is one which is substantial and which cannot be
remedied by damages......... an injury is irreparable where the damages are estimable
only by conjecture, and not by any accurate standard.

Again, as held in Wander Ltd. v Antox India Pvt. Ltd.,20 the court would also, in
restraining a defendant from exercising what he considers his legal right but
what the plaintiff would like to be prevented, put into the scales as a relevant
consideration, whether the defendant has yet to commence his enterprise or
whether he has already been doing so. In the latter case, considerations
somewhat different from those that apply to a case where the defendant is yet
to commence his enterprise, are attracted, since the hardship is so much lesser

18
1981 (2) SCC 766.
19
MANU/AP/0042/2009.
20
(1990) Supp. SCC 727.

13
when business activities have not yet commenced or are at an early stage of
commencement.21
In Narmadha Chemicals (P) Ltd. v Siva Shakthi Soap Works, 22 the Madras High
Court has rightly held that for the purpose of granting injunction under Order
XXXIX Rule 1 and 2 of the CPC, it is to be seen whether the applicant has
established a prima facie case and proved irreparable injury that would be
caused if the injunction is not granted. If these elements are proved, balance
of convenience would automatically follow.

Ex Parte Injunctions
The general rule, covered in Order XXXIX, Rule 3 is that the Court shall,
before granting an injunction, direct notice of the injunction application to be
given to the opposite party. The exception to this general rule is also
mentioned in the same provision, being a situation where it appears that the
object of granting the injunction would be defeated by the delay. The
Supreme Court in Morgan Stanley Mutual Fund v Kartick Das,23 has held that as
a principle, ex parte injunctions should be granted only under exceptional
circumstances. The Court also listed out certain factors which should weigh
with the Court when granting ex parte injunctions, which are reproduced
below:
(a) whether irreparable or serious mischief will ensure to the plaintiff;
(b) whether the refusal of ex parte injunction would involve greater injustice
than the grant of it would involve;
(c) the time at which the plaintiff first had notice of the act complained, so that
the making of an improper order against a party in his absence is prevented;

21
This principle was applied in Goenka Institute of Education and Research v Anjani Kumar Goenka,
2009 (40) PTC 393,.to vacate the interim injunction granted by the Single Judge since it would cause
irreparable hardship to the defendant who was already running its school for a fairly long period,
honestly and concurrently with the plaintiff.
22
MANU/TN/7784/2006.
23
(1994) 4 SCC 225.

14
(d) whether the plaintiff had acquiesced for some time with the defendant’s
conduct, in which case it shall not grant an ex parte injunction;
(e) the court would expect a party applying for ex parte injunction to show
utmost good faith in making the application;
(f) even if granted, the ex parte injunction would be for a limited period of
time;
(g) general principles like prima facie case, balance of convenience and
irreparable loss would also be considered by the court.

Enforcement of an order of Injunction

Post the introduction of Order XXXIX, Rule 2-A in 1976, there is an effective
remedy made available to the plaintiff to directly approach the same Court
that granted the order of injunction, seeking attachment of the property of the
person guilty of disobeying this order, or his arrest. This provision reads as
follows:
Rule 2A. Consequence of disobedience or breach of injunction
(1) In the case of disobedience of any injunction granted or other order made under
rule 1 or rule 2 or breach of any of the terms on which the injunction was granted or
the order made, the Court granting the injunction or making the order, or any Court
to which the suit or proceeding is transferred, may order the property of the person
guilty of such disobedience or breach to be attached, and may also order such person
to be detained in the civil prison for a term not exceeding three months, unless in the
meantime the Court directs his release.
(2) No attachment made under this rule shall remain in force for more than one year,
at the end of which time, if the disobedience or breach continues, the property attached
may be sold and out of the proceeds, the Court may award such compensation as it
thinks fit to the injured party and shall pay the balance, if any, to the party entitled
thereto.
Prior to the introduction of the above provision in 1976, the Trial Court before
whom a suit was pending had no jurisdiction to punish the defendant if the

15
interim order of injunction passed by it under Rules 1 or 2 was disobeyed by
the defendant. The aggrieved plaintiff in that case was required to move the
High Court for an action in contempt under the Contempt of Courts Act.
Order XXXIX, Rule 2-A is attracted only in case of disobedience of an order of
injunction of any other order made under Rule 1 or 2 or breach of the terms
on which the injunction was granted or order was made. This provision does
not apply to the final decree of permanent injunction passed by the Court at
the conclusion of the hearing of the suit. It is also doubtful whether Rule 2-A
would apply for breach of an undertaking given to the Court.24 The object of
Rule 2-A is not to punish a person for disobedience of an injunction order but
to ensure the enforcement and compel the party to act according to injunction.
As soon as the party concerned starts complying with the injunction order or
such order is vacated, the party cannot be held guilty of disobedience and
must be released if in detention in civil prison. 25 It is only when the party
against whom temporary injunction is issued, willfully disobeys it, that action
can be initiated under Rule 2-A. Willful disobedience requires that the party
had intentionally and knowingly disobeyed the order,26 which is not possible,
for instance, in a case where the order itself is vague and ambiguous.

PART II

Anton Piller Order

In U.K. and legal systems that follow the English legal system including India,
Anton Piller orders, being court orders that provide the right to search
premises of a defendant and seize evidence without prior warning, are
granted in order to prevent destruction of incriminating evidence at the hands

24
The Municipal Corporation of Greater Mumbai v. Shri Bhikanlal Nanakchand Sharma, (2007) 109
Bom L.R. 430.
25
Rachhapal Singh v. Gurudarshan, AIR 1985 P&H 299.
26
State of Bihar v. Rani Sonabati Kumari, AIR 1961 SC 221.

16
of the defendant, particularly in cases of alleged trade mark, copyright or
patent infringements.
These types of orders take their name from the decision of the Court of
Appeal in Anton Piller KG v Manufacturing Processes Limited 27 in 1976, although
the first reported order of this nature was granted in EMI Limited v Pandit.28 It
must however, be noted that because such orders are essentially unfair to the
defendant, they are only issued exceptionally and according to the three-step
test set out in the Anton Piller case:
1. There is an extremely strong prima facie case against the defendant,
2. The damage, potential or actual, must be very serious for the plaintiff,
and
3. There must be clear evidence that the defendants have in their
possession incriminating documents or things and that there is a real
possibility that they may destroy such material before the same can be
brought to court for the evidence stage.
In cases of the above nature, the judicial order may only allow for a report
containing a description of the alleged counterfeited goods and processes
based upon the physical examination, which may be used at the time of trial,
or additionally permit actual seizure of the goods or works in question as well
as the equipment used to commit infringement so as to put an immediate end
to the unauthorized reproduction of the goods bearing the plaintiff’s mark or
of the plaintiff’s works etc.
Courts in India have had to place reliance on Anton Piller orders due to a
vacuum in the law. Order XXVI Rules 9 and 10 of the Code of Civil Procedure
permit the appointment of a commission for local investigation and provide
for their powers. Though this power exists, these provisions are silent on
whether such Commission can be appointed at the very first hearing ex parte.
This is in stark contrast with the proviso to Order XXXIX Rule 3 of the CPC

27
[1976] 1 All E.R. 779.
28
[1975] 1 All E.R. 418.

17
that facilitates the grant of ex parte injunctions.29 In effect, an Anton Piller does
the same as the proviso to Order XXXIX Rule 3 of the CPC in terms of allowing
the appointment of a Commission without notice to the other party when the
object of appointment of such Commission, ie. local investigation “requisite or
proper for the purpose of elucidating any matter in dispute”, would be defeated
due to delay.

PART III

Exemplary Damages

Apart from granting an injunction, the Court can also order the defendant to
pay damages to the plaintiff for the losses suffered by him as a consequence
of the defendant’s infringing conduct. Most IPR infringement suits are
worded as a suit for permanent injunction restraining the defendant from
carrying on acts of IPR infringement, as well as a suit for payment of damages
or rendition of accounts. Apart from normal damages payable for losses
suffered by the plaintiff, a practice of awarding exemplary damages has also
slowly evolved, especially due to the strict approach in this direction by the
Delhi High Court, as opposed to more liberal views in the past. 30 One of the
29
Or. XXXIX R.3. Before granting injunction, court to direct notice to opposite party
The court shall in all cases, except where it appears that the object of granting the injunction would be
defeated by the delay, before granting an injunction, direct notice of the application for the same to be
given to the opposite party;
Provided that, where it is proposed to grant an injunction without giving notice of the application to
the opposite party, the court shall record the reasons for its opinion that the object of granting the
injunction would be defeated by delay, and require the applicant--
(a) to deliver to the opposite party, or to send to him by registered post, immediately after the order
granting the injunction has been made, a copy of the application for injunction together with--
(i) a copy of the affidavit filed in support of the application;
(ii) a copy of the plaint; and
(iii) copies of documents on which the applicant relies, and
(b) to file, on the day on which such injunction is granted or on the day immediately following that day,
an affidavit stating that the copies aforesaid have been so delivered or sent.
30
In one of the earlier cases, the Delhi High Court had refused to grant exemplary damages despite
intentional infringement by the defendant, coupled with destruction of books of account in order to
suppress economic data pertaining to sales, being clear on the facts. The reason adduced was the public
service character of the plaintiff’s work. See P.N. Krishna Murthy v Cooperative for American Relief

18
leading cases on this is the decision in Time Incorporated v Lokesh Srivastava.31
Though this was a case pertaining to trade mark infringement, the principles
laid down here have been subsequently followed in a number of copyright
cases as well.
While granting the prayer for punitive damages as sought for by the plaintiff,
the Delhi High Court held:
Coming to the claim of Rs. 5 lacs as punitive and exemplary damages for the flagrant
infringement of the plaintiff's trade mark, this Court is of the considered view that a
distinction has to be drawn between compensatory damages and punitive damages.
The award of compensatory damages to a plaintiff is aimed at compensating him for
the loss suffered by him whereas punitive damages are aimed at deterring a wrong
doer and the like minded from indulging in such unlawful activities. Whenever an
action has criminal propensity also, punitive damages are clearly called for so that the
tendency to violate the laws and infringe the rights of others with a view to make
money is curbed. The punitive damages are founded on the philosophy of corrective
justice and as such, in appropriate cases these must be awarded to give a signal to the
wrong doers that law does not take a breach merely as a matter between rival parties
but feels concerned about those also who are not party to the lis but suffer on account
of the breach........This Court has no hesitation in saying that the time has come when
the Courts dealing with actions for infringement of trade marks, copyrights, patents
etc. should not only grant compensatory damages but award punitive damages also
with a view to discourage and dishearten law breakers who indulge in violations with
impunity out of lust for money so that they realize that in case they are caught, they
would be liable not only to reimburse the aggrieved party but would be liable to pay
punitive damages also, which may spell financial disaster for them.
This decision has been followed by the Delhi High Court in several copyright
cases as well, including the decision in Microsoft Corporation v Kiran.32 Here,
the High Court clarified the position of law as follows:

Everywhere, AIR 2001 Del 258.

31
2005 (30) PTC 3.
32
2007 (35) PTC 748.

19
The legal position in India with respect to granting damages in cases of infringement
of trademarks and copyrights has been progressive. The courts have now started
granting the relief of damages with the view that a defendant cannot escape damages
as a consequence of its disappearing from the legal proceedings. The claimant has a
right to damages regardless of the defendant's state of mind, and that is so regardless
of whether the cause of action is infringement of a registered mark, or passing off.
Finding the defendants guilty of “deliberate and calculated” infringement, the
High Court awarded punitive damages as sought for by the plaintiff.
Similarly, in the oft-cited decision in Hero Honda Motors Ltd. v Shree
Assuramji Scooters,33 the Delhi High Court has considered the effect of willful
abstention of the defendant from legal proceedings initiated against them for
infringement of intellectual property rights and held as follows:
I am in agreement with the aforesaid submission of learned counsel for the plaintiff
that damages in such cases must be awarded and a defendant, who chooses to stay
away from the proceedings of the Court, should not be permitted to enjoy the benefits
of evasion of court proceedings. Any view to the contrary would result in a situation
where the defendant who appears in Court and submits its account books would be
liable for damages, while a party which chooses to stay away from court proceedings
would escape the liability on account of failure of the availability of account books. A
party who chooses to not participate in court proceedings and stay away must, thus,
suffer the consequences of damages as stated and set out by the plaintiff. Of course,
this would not imply that the plaintiff would be entitled to any figure quoted by it
which may be astronomical. The figure of Rs. 5 lakhs as damages can hardly be said to
be astronomical keeping in mind the nature of deception alleged by the plaintiff which
not only causes direct loss to the plaintiff, but also affects the reputation of the
plaintiff by selling sub-standard goods in the market where the public may be
deceived in buying the goods thinking the same to be that of the plaintiff. There is a
larger public purpose involved to discourage such parties from indulging in such acts
of deception and, thus, even if the same has a punitive element, it must be granted.

33
2006 (32) PTC 117.

20
It is felt that this shift in judicial approach to damages reflected in the award
of exemplary damages in appropriate cases is a welcome trend and gives
teeth to the legal protection against rampant and unbridled infringement of
intellectual property rights.

PART IV

Damages and Rendition Of Accounts

Exemplary Damages are clearly an exception, and the norm is to award

damages that compensate the copyright owner for the loss suffered by him as
a consequence of the defendant’s infringement. Needless to say, damages are
awarded only at the culmination of the trial as a final relief. However, the
defendant can be asked to maintain accounts even at the interim stage as done
most often. The distinction between damages and rendition of accounts has
been explained by the Delhi High Court in Titan Industries v Nitin P Jain.34
Here, the High Court observed:
Damages are a matter of right; the account of profits is an equitable remedy and the
court has a discretion whether or not to grant it. Accordingly, a successful claimant
in an infringement action is entitled to an inquiry as to damages (at his own risk as to
costs) in any case where there is a prospect that the inquiry would reach a positive
result; whilst only in certain cases will the court grant an account of profits. In these
cases, the claimant has an option (exercisable at the conclusion of the hearing of the
case) to claim either damages or profits; he cannot have both. Accordingly, it is usual
in particulars of claim to ask for the two in the alternative. The principle upon which
the court grants an account of profits is that where one party owes a duty to another,
the person to whom the duty is owed is entitled to recover from the other party every
benefit which that other party has received by virtue of his fiduciary position if in fact

34
2006 (32) PTC 95.

21
he has obtained it without the knowledge or consent of the party to whom he owed the
duty. An account is generally refused if the defendant had no knowledge of the
claimant’s mark and, when ordered, is limited to the period during which such
knowledge had existed; whilst knowledge or absence of knowledge does not affect the
right to damages.
A claimant who has been successful in an action for trade mark infringement or
passing off may not have sufficient knowledge of the defendant’s activities to make an
informed decision as to whether he should seek an inquiry as to damages or an
account of profits. In such a case he may seek disclosure before making his
election.......Disclosure given in such circumstances should be limited to that which is
necessary for the claimant to make an informed decision within a reasonable time; he
is not entitled to all the disclosure which would be given in the inquiry, and in
appropriate circumstances an audited schedule of infringing dealings may be a
substitute for documentary disclosure.
Based on this, the High Court concluded the prayers were not incorrectly
sought for since the plaintiff’s right of election could be exercised after
conclusion of the trial.35

Maintaining Accounts – An Alternative to Interim Injunction

In R.M. Subbiah v N. Sankaran Nair,36 the Madras High Court laid down a
general principle pertaining to grant of injunctive relief in the context of
copyright piracy in the following terms:
This is a case where literary piracy is pleaded. Injunction being an equitable remedy,
which is granted by a court in exercise of its judicial discretion, has to be considered
from various facets which arise from a particular set of circumstances in each case.
There may be cases in which the grant of an injunction temporary or permanent will
35
In Pillalamarri Lakshmikantham v Ramakrishna Pictures, AIR 1981 AP 224, it has been held that
the remedies of damages and accounts are remedies in the alternative as the two reliefs are
incompatible, and based on this statement of law, the plaintiff / appellant in that case was held
disentitled to their claim of accounts, since damages were already awarded. Unfortunately the plaintiff
did not prefer an appeal against the valuation of the damages. Hence, the Court, despite concluding that
the damages were arbitrarily fixed, refused to interfere with the damages awarded by the lower court.
36
AIR 1979 Mad 56.

22
only meet the ends of justice and an alternative safeguard for the preservation of the
rights of the challenging party cannot at all be thought of. There may be also cases
where the remedy of injunction has to be made flexible and adjustable to the
situations arising in each case. A rigid invocation without contemplating elasticity in
the application of the rule as to the grant of injunction might sometimes result in
hardship, which cannot be later cured.
This principle has been relied on by the Madras High Court in K.S.Gita v
Vision Time India Pvt. Ltd.,37 to refuse injunction in a factual situation where
the High Court felt that ownership of the copyright could be ascertained only
at the time of trial. According to the High Court, it was sufficient to protect
the interests of the plaintiff that the defendant be directed to maintain
accounts. The High Court also rejected the appellant / plaintiff’s prayer
seeking a direction to the defendant to deposit Rs. 10 lakhs every month by
way of royalty. In the High Court’s view, this amounted to furnishing of
security by the defendant, a relief envisaged under Order XXXVIII, Rule 5 of
the Code of Civil Procedure, 1908. This power was to be exercised sparingly
and not to convert an unsecured debt into a secured one. In the instant case,
the plaintiff had to make out a case that she was entitled to damages. When
such was the factual circumstance, it would be too drastic a step to insist on
deposit of monthly royalty to the Court.

From the above discussion, it is clear that there is a wide array of remedies
generally available to secure intellectual property rights, and that of these,
injunctions are the most favoured. Intellectual property rights being time-
bound monopolies, it is important to tailor remedies that protect the
exclusivity of these rights for the limited time given to the owner to make full
use of such exclusivity. Measures such as injunctions and exemplary damages
strive to do so.

37
MANU/TN/0202/2010.

23
Self-Check Exercise
⮚ What is the difference between temporary and permanent injunctions?

24
⮚ What are the conditions governing the grant of temporary injunctions

under the Civil Procedure Code?

⮚ Examine the factors to be considered by courts when granting ex-parte

injunctions, as laid down by the Supreme Court in the case of Morgan

Stanley Mutual Fund v Kartick Das.

25
 Points to Remember
An injunction is an equitable remedy in the form of a
judicial order, whereby a party is required to do, or to refrain
from doing, certain acts.
In India, injunctions are available under both civil and
criminal law.
Different types of injunctions that are granted in context of
IPRs: ex-parte, ad-interim, quia-timet and permanent. Anton
Piller orders and Mareva injunctions form a category of
injunction in IPR cases.
Anton Piller orders take their name from the decision of the
Court of Appeal in Anton Piller KG v Manufacturing Processes
Limited in 1976. They are granted in order to prevent
destruction of incriminating evidence at the hands of the
defendant, particularly in cases of alleged trade mark,
copyright or patent infringements.
Mareva injunctions are restraint orders “freezing” the assets
of the defendant, and can be issued even if the property or the
person concerned is outside the jurisdiction of the court,
provided that the assets are within such jurisdiction. Such
orders derive their nomenclature from the decision of the
Court of Appeals in Mareva Compania Naviera SA v International
Bulkcarriers SA.
Order XXXIX, Rules 1 and 2 of the Code of Civil Procedure,
1908 provide for situation when temporary injunctions can be
granted by the Court.
The general rule on ex-parte injunctions, covered in Order
XXXIX, Rule 3 of the Civil Procedure Code is that the Court
shall, before granting an injunction, direct notice of the
injunction application to be given to the opposite party.
In Morgan Stanley Mutual Fund v Kartick Das, the Supreme
Court has held that as a principle, ex parte injunctions should
be granted only under exceptional circumstances.

26
Self-Check Exercise

⮚ What is the difference between temporary and permanent injunctions?

⮚ What are the conditions governing the grant of temporary injunctions

under the Civil Procedure Code?

⮚ Examine the factors to be considered by courts when granting ex-parte

injunctions, as laid down by the Supreme Court in the case of Morgan

Stanley Mutual Fund v Kartick Das.

⮚ Why are ex parte injunctions granted?

27