Software patent opposition is still in its nascent stage in India while several oppositions have been filed against software patents in the US and the EU. The harmful effects of software patents are little known to the Indian public, especially from the context of its danger to development in small and medium size enterprises, as pointed out by Pranesh Prakash from the Centre for Internet and Society who spoke about why software patents are bad for innovation and development in society and also in the software industry, in particular.

In the same context, Venkatesh Hariharan from Red Hat as also Mr. T.C. James, Director of the National Intellectual Property Organisation spoke about the growing importance of free and open source software in education, governmental agencies and as a key agent in information technology policy making in India. “Out of 500 super computers in the world, 446 are running on Linux”, he said, talking about how open source software makes computing highly accessible and affordable while allowing for improvements to be made to the software by any user and releasing it back to benefit the whole community. Dr. Anshu Bhardwaj involved in the Open Source Drug Discovery project undertaken by CSIR, spoke at length about the project as a live demonstration of the power of open source software in impacting drug access and development and health care reform across communities at highly economical rates.

Prof. Eben Moglen, Executive Director of Software Freedom Law Centre in New York who was the keynote speaker at the conference spoke about the growth of the free software and open source movement based on the principle of equating knowledge with commons – that is, a good to be commonly shared by all members of the public – resulting in access to and sharing of knowledge and distribution of information in society for greater innovation, creation of new ideas, communication and development. Dr. Abhijit Sen, member of the Planning Commission was the other keynote speaker who stressed on the role of the government and the policy making bodies to ensure that knowledge and education is accessible and shared without restrictions in such a way that it is not misused by the members of the society.

Other notable speakers in the event included Prabir Purkayastha from the Society for Knowledge Commons, Pradyut Bora, Chief Convenor of BJP's information and technology cell, Jaijit Bhattacharjee from Hewlett Packard and Sudhir Krishnaswamy, Professor, National University of Juridical Sciences. The event also witnessed the participants discuss the various strategies to be used from the perspective of legal analysis as well as policy reform, for opposing software patents filed or granted in India. Indian patent law clearly declares computer programmes per se or software patents to be unpatentable. Prabir Purkayastha pointed out that the most important and major scientific discoveries in history have not been patented and that this has, in no way prevented new ideas from being created and has in fact fostered such innovation. In spite of such a clear legal restriction on grant of software patents, around 1000 software patents have been filed in the patent offices in India in the last year. This trend is extremely disturbing since it poses a serious threat to access to knowledge and distribution of information in society in addition to stifling innovation and development in the software industry.

The seminar was attended by people from diverse backgrounds including the IT industry, civil society organisations, and groups working in pharma patent advocacy, media persons and government officials.

As eagerly as it was awaited, the United States Supreme Court’s decision in Bilski v. Kappos (2010) was a dampener as far as its impact (or the lack of it) on patentability of software was concerned. The Supreme Court totally avoided even mentioning software patents or the applicability of the machine or transformation test for software patents in its decision and while many claimed that it was status quo maintained, a few of us found a silver lining in the Court’s ruling of abstract ideas as unpatentable and its admission of an argument that patents do not necessarily promote innovation and may, sometimes result in limiting competition and stifling innovation. Our hope that the Bilski case furthered the cause of narrowing the patentability of software was not misplaced is evident from the first decision post-Bilski, of the BPAI, which rejected a software patent claimed by Hewlett-Packard. The BPAI, in In Re Proudler, rejected a patent claim for software made by Hewlett Packard on the ground that software, being an abstract idea, is not patentable. The BPAI relied on, among others, the Supreme Court’s decision in Bilski v. Kappos in holding that an abstract idea was not patentable.

The case before the BPAI was on appeal from the decision of the patent examiner who refused patent for the claim on the ground that it was obvious (on basis of prior art analysis) and therefore, “barred at the threshold” for patentability under US patent law. The patent was claimed for “a method of controlling the processing of data” comprising “defining security controls for a plurality of data items, and applying individualised security rules to each of the data items based on a measurement of integrity of a computing entity to which the data items are to be made available”. It was essentially a claim for software facilitation data processing and involving security controls for several data items. The BPAI refused patent for the claim but differed from the patent examiner in its reasoning. The BPAI held that all claims related to non-patentable subject matter and hence, could not be granted patent.

In coming to this conclusion, the BPAI relied on previous decisions including In Re Nuijten  which held that Section 35 of the US Code of Patents which allows patents for a machine, a manufacture, a process or a composition of matter constitutes “the exclusive reach of patentable subject matter”. In ruling that HP’s claim was not patentable, BPAI also held that software, being an abstract idea, was not patentable. The line of argument relied on by the BPAI was something like this – “[A] machine, a manufacture, a process or a composition of matter” constitutes the exclusive reach of patentable subject matter. Thus, laws of nature, abstract ideas, and natural phenomena are excluded from patent protection as held in the well known case of Diamond v. Diehr. The Federal Circuit in its decision in In re Warmerdam has held that an abstraction is not a patentable subject matter. In other words, a claim that recites no more than software, logic or a data structure (that is, an abstraction) does not fall within any statutory category. It has been held in Microsoft Corp. v. AT & T Corp. that an abstract software code is an idea without physical embodiment. Finally, and most significantly, the Bilski case has put the nail in the coffin by ruling that abstract ideas are not patentable. Against the background of these precedents, BPAI has confirmed the unpatentability of software on the ground that it is an abstract idea.

It is interesting that the BPAI also mentioned that “no true hardware structure is recited” in the claims to buttress its conclusion that the idea claimed was an abstract one. This means that the BPAI took note of the fact that although a hardware structure may have been essential to implement the abstract idea forming the claim such structure itself was not claimed for patent. The innovation claimed lay in the software alone and not in the hardware and therefore, did not merit patent protection. Thus, a claimed invention which is a combination of hardware (required to implement the software) and software may not be patentable as long as there is no ingenuity in the hardware as software alone, being a mere algorithm and an abstraction, falls outside the scope of patentable subject matter.

The first post-Bilski decision gives us more than one reason to cheer about –

• It refused patent for software on the ground that it was an abstract idea and hence, did not fall under patentable subject matter. Acceptance of software as merely an abstract idea is catching up and is thus, good news for those who challenge the patentability of software.
• The BPAI, in ruling software as an abstraction and thus, unpatentable relied directly on the Bilski decision and therefore, provided a clear, much-needed guideline for conclusively interpreting the Bilski decision as one restricting the patentability of software.
• The decision supported the argument that any combination of hardware and software, to be patentable, must demonstrate ingenuity in the hardware component. As long as there is no claim for hardware, the software itself, being an abstraction, cannot be patented. This brings about greater clarity in the definition of software to be limited to an algorithm (and thus, abstract) and to be looked at in isolation from a hardware component which is solely used to implement the software and no more.
  

It will be interesting to follow the developments in this case and in other future claims for software which may rely on the Bilski decision. In Re Proudler is certainly encouraging for limiting software patents especially in the aftermath of Bilski. As far as patentability of software is concerned, the Bilski decision may not be that insignificant after all.

The United States Supreme Court’s much awaited decision of last month in Bilski v. Kappos (2010) (Bilski), a case that was touted as a potential watershed in the debate surrounding patentability of software, was disappointing, even though it was not without any impact. While the Supreme Court affirmed the rejection by the Court of Appeals for the Federal Circuit (CAFC) of a patent claim for a business method, it failed to define with clarity, any test for patentability which might have constituted a precedent for future cases involving patentability of software or business method. At the same time, it held that the “machine- or- transformation” test which was the test followed by the CAFC in rejecting the claim, was not the sole test to determine patentability, thus effectively providing no guideline to determine patentability of software or business methods in future cases.

The Supreme Court in Bilski, affirmed the rejection by the CAFC in In re Bilski (2008) of a patent claim involving a method of providing insurance against fluctuating energy prices due to changes in weather. The applicants, Bernard L. Bilski and Rand Warsaw filed a patent application for such a method of hedging risks – essentially a claim for a business method – under Section 101 of US Patent Act before the United States Patent and Trademark Office (USPTO). The examiner at the USPTO rejected the claim on the ground that the claim was not for patentable subject matter and that “the invention is not implemented on a specific apparatus and merely manipulates (an) abstract idea and solves a purely mathematical problem without any limitation to a practical application, therefore, the invention is not directed to the technological arts”. The Board of Patent Appeals and Interferences (BPAI) took a re-look at the examiner’s decision and held that the “machine or apparatus” test was in itself insufficient to determine patentability since a claim that included transformation of a physical object from one state to another would also be patent eligible subject matter. The BPAI also struck down the requirement of the invention to be a “technological art”. Thus, it rejected the Bilski claim on the ground that it did not cause transformation of a physical object from one state to another, since transformation of financial liabilities and risks does not constitute transformation of physical matter.

In its decision on October 30, 2008, the CAFC affirmed the ruling of the BPAI and laid down the machine or transformation test for patentability and held that Bilski’s claim was neither tied to any machine or apparatus to derive the result nor did it cause transformation of any physical object from one state to another and is hence, unpatentable subject matter. The Court reasoned that the “machine or transformation” test was crucial for determining patentability as it ensured that the claim based on a fundamental principle did not preempt all other uses of the principle. This test was the first test since the US Supreme Court’s decision in Diamond v. Diehr (1981) – which held that laws of nature, mathematical formulae and algorithms are not patentable – that had a huge potential for laying down definitive rules for patentability including declaring software and business methods to be outside the realm of patentable subject matter. If this test was upheld in the Supreme Court, that would effectively put an end to the rise of software patents since software, in most cases, did not cause transformation of physical object from one state to another. Thus, the decision of the Supreme Court had huge stakes for both sides of the software patent debate.

In light of the same, the Supreme Court’s ruling holding that the machine or transformation test is not the sole test for determining patentability and at the same time, failing to provide any other test on which to determine patentability, was a sore disappointment. Though, it affirmed the rejection of Bilski’s patent claim on the ground that the subject matter claimed was abstract and thus not a patentable “process” under section 101, its core decision was only limited to this particular claim and it did not lay down a concrete and definitive guideline for future claims. However, one must not be too quick to dismiss this decision as either going against the interests of open society and free software or as a completely inconsequential case that simply maintains status quo. There are important takeaways for the patentability of software in the Bilski decision – The Court did not totally reject the machine or transformation test relied on by the CAFC. It only held that the machine or transformation test is not the sole test on basis of which the patentability of a subject matter of a claim can be decided. The Court, in fact, held that the “machine or transformation test” was a “useful and important clue, an investigative tool for determining whether some claimed inventions are processes under section 101.”  This leaves open the possibility of using the test to determine patentability in future cases and this is good news for opponents of software patents since software (an algorithm designed to be operated upon by a computer) is merely an abstract idea which, in most cases, does not involve transformation of a physical object from one state to another.

Bilski’s claim was essentially interpreted to be a patent for a business method. The Supreme Court was completely silent on the issue of patentability of software in its decision and stuck to only the narrow issue in hand – that of the patentability of a particular business method. This means that the “machine or transformation test”, whose applicability was ruled out in this particular case, may still be applicable for software patents. Nothing in this case precludes an opponent of a software patent from urging the courts to use the “machine or transformation test” to rule on patentability. Thus, the very fact that the Supreme Court only dealt with the narrow issue in hand ensures that the “machine or transformation test” is not altogether dismissed.

The main ground on which Bilski’s claim was rejected was that the patent claim was for an overly abstract idea which was not patent-eligible. The Court held that the basic concept on which the claim was based – the concept of hedging risks against risk is an unpatentable abstract idea. Further, some of the claims are constituted by equations and are purely mathematical in nature and are abstract and thus not patentable. This means that basic concepts and use of mathematical formulae constitute abstract ideas which are unpatentable. This test can strike down many software patents as these are simply algorithms executed by a computer and incorporate very fundamental and basic concepts which are abstract in nature and are thus, not patentable. This test for determining patentability on the basis of the claim being abstract as laid down in Bilski reaffirms the patentability test laid down in Diamond v. Deihr which kept laws of nature, mathematical formulae and algorithms outside the scope of patentable subject matter. This may serve as an important test to determine and especially, limit the patentability of software in coming years.

Notwithstanding the fact that Bilski’s claim has been interpreted to be one of a business method patent, when examined in detail, the claims indicate that the ‘method’ cannot be implemented without a computer. Certain claims for calculating probability (and risk), although mathematical or algorithmic in nature, have too many variables to be executed in any way other than by using a computer.1 Such algorithms which can be executed only by a computer fall under the category of software and the patent is thus, also, a software patent. That being said, the ruling of the Court that the claim is for an overly abstract idea and thus not patentable lends credence and indicates that software patents can be validly claimed to be abstract ideas not falling under the scope of patentable subject matter.

Another important outcome of the Supreme Court’s ruling was the invalidation of the 1998 CAFC decision in State Street Bank v. Signature Financial Group2 which opened the floodgates for software patents by holding that a practical application of an algorithm or formula to produce “useful, concrete and tangible result” was sufficient to constitute patentable subject matter. The State Street test was too broad and afforded an opportunity for many frivolous patent applications to be admitted. In fact, Justice Stevens, in his concurring opinion, has stated that it would be a “grave mistake” to follow the test. By clearly striking down and dismissing such a test to determine patentable subject matter, the Court in Bilski has precluded future software patent claims for taking recourse to this test and has effectively, to an extent, made it that much harder for a software to be granted patent. The test in State Street Bank which opened the floodgates for software patents was definitively dismissed.

The Court in the 1978 case of Parker v. Flook, had rejected patent for a mathematical algorithm on the ground that an algorithm was a law of nature although its use was limited to a specific field in this case (the “field of use” test) and added an insignificant post solution activity (“post solution activity” test). The test laid down in Flook had been subsequently questioned and thus, subtly dismissed by the Court in Diehr in 1991. The Court in Bilski emphasized on the test for patentability laid down in Flook and opined that the two tests may well come in handy in future challenges or oppositions to a patent claim while determining if the claim pertained to an idea that was abstract and hence, not patentable. Thus, this test can be used in future for invalidating software patents which are characterized by broad claims adding insignificant post solution activity.

It is heartening to note that the Court looked at the importance of patent law while recognizing that patents are not always necessary to encourage innovation. It noted that patents could also limit competition and stifle innovation. They can have ill effects such as increasing prices while slowing progress and could actually be deterrent to free flow of information within society. By recognizing and validating this, the ruling not only helped increase awareness about the debate surrounding software patents but also showed that the Courts are open to such an approach to patent law in future. This can only be good news for busting software patents.

For further reading

1. Claim 4 of Bliski's claims is as follows -  “perform a Monte Carlo simulation across all deals at all locations ... over the last 20 years of weather patterns and establish the payoffs from each deal under each historical weather pattern “ Such a simulation would involve multiple parameters such as deals, locations, weather patterns, to establish a payoff.

2. 149 F.3d. 1368.

India's Copyright Act was established in 1857 and was most recently amended in 2010. Although India at present is not a member of WIPO, the provisions in the proposed Bill will work to make the Act WIPO compliant. When looking at privacy in the context of copyright, four key questions arise:

How do DRM technologies undermine privacy and what safeguards are present in the Indian Law to protect citizens’ right to privacy?

Technologies such as digital rights management technologies were developed to be used by hardware manufacturers, publishers, copyright holders and individuals to impose limitations on the usage of digital content and devices. DRM technologies pose as a privacy threat, because in their ability to monitor what is happening to a copyrighted work, they are also able to collect personal information and send it back to a host without knowledge of the user. The host is then able to use that data for marketing or commercial purposes. In the Copyright Act, 1957 there are no current provisions against DRM circumvention. In the proposed Copyright Bill 2010 there are two proposed provisions to prevent anti circumvention of DMR technologies, and one provision that clarifies what is a DMR technology. 

Proposed Legislation

Section 2 (xa): Defines Rights Management information.
Section 65A : Protection of Technological Measures - Any person who knowingly makes or has in his possession any plate for the purpose of making infringing copies of any work in which copyright subsists shall be punishable with imprisonment which may extend to two years. The section includes that any person facilitating circumvention by another person of a technological measure, shall maintain a complete record of such other persons including his name, address and all relevant particulars necessary to identify him.
Section 65B: Protection of Rights Management Information – Any person who removes or distributes, copies or broadcasts any rights management information without authority shall be by punishable with imprisonment. 

Recommendation

We find that in this provision the privacy of an individual is brought into question, because there are no safeguards against the commercialization of information, and no formal process of redress if an individual discovers that his information is being used without his consent/prior knowledge. We would recommend that it be clearly articulated in the provision that the collection and commercialization of information and personal data is prohibited by DRM technologies and host companies, and a method of redress be put in place. 

Under the present copyright does a person have the ability to expose privacy infringement?

Because DRM technologies often employ the use of spy-ware, it is important that an individual has the ability to know if spy-ware is being used on their computer systems. Currently reverse engineering is permitted under provision 52 (ac). The amended version of provision 52 is less clear on if reverse engineering would be allowed.  

Current Legislation

Provision 52 (ac): Certain acts not to be in infringement of copyright include the observation, study or test of functioning of the computer programs in order to determine the ideas and principles which underlie any elements of the program while performing such acts necessary for the functions for which the computer program was supplied.  The following acts shall not constitute in infringement of copyright, namely:

Proposed

The proposed amendment reads:

 52 (1) The following acts shall not constitute an infringement of copyrights, namely:  

(i)    (a) a fair dealing with a literary, dramatic, musical or artistic work not being a computer program for the purposes of:

(ii)    private use, including research

(iii)    Criticism or review, whether of that work or of any other work.

The exclusion of computer program in the proposed bill makes it unclear under what circumstances reverse engineering would be allowed.

Recommendation

We would recommend that for clarity purposes a specific clause be added to the act that details under what circumstances a person is allowed to reverse engineer a product for protection of their own privacy. 

How does the proposed exception for the disabled undermine privacy?

In India under the current Copyright Act, 1957 there are no provisions for the benefit of disabled persons, thus currently permission from copyright holders needs to be exclusively sought every time the visually challenged person requires access. Under the Constitution of India and the Berne Convention, India has committed to enshrining the rights of the disabled. 

Proposed Legislation

The proposed amendment of the Act will  grant compulsory license in respect of publication of any copyrighted works not covered by the exception under section  52 (1) (zb).

The Bill also proposes a board that would establish the credentials of the applicant and satisfy itself that the application has been made in good faith. This compromises the anonymity that most individuals enjoy when a disabled person tries to access a digital library.

Recommendation

We recommend that the proposed Bill limits the authentication process a disabled person must go through when accessing digital libraries, etc, and the extent to which records are to be kept of transaction  This will serve to protect the anonymity and privacy of disabled persons.

What is On the horizon?

As copyright and IP is a constantly evolving issue, countries are consistently amending and changing their laws. With the flow of peoples across borders increasing, Indians will be affected by different international policies that could pose to infringe upon their privacy, for example, cross border checks or three strike regimes.  

Examples of Proposed Legislation: The Anti- Counterfeiting Trade Agreement

ACTA is a proposed legislation with the objective to combat counterfeiting and piracy. Partners in the negotiations include the United States, Australia, Canada, the European Union, Japan, Mexico, Morocco, New Zealand, Singapore, South Korea and Switzerland. The treaty will oblige each Contracting Party to adopt, in accordance with its legal system, the measures necessary to ensure the application of the treaty. Though ACTA has not been enacted, many worry that ACTA would facilitate privacy violations by trademark and copyright holders against private citizens suspected of infringement activities without any sort of legal due process. The Act would allow for random searches of laptops, MP3 players, and cellular phones for illegally downloaded or ripped music and movies. 

Recommendation

We find that copyright infringement does not appear to justify a three strike regime or cross border searches.  ACTA and other international treaties raise the question that if India became compliant with certain international standards, the standards would be too stringent without safeguards, and pose as a risk to a person’s privacy.

The full submission that CIS and 21 other civil society organizations made to the Rajya Sabha Standing Committee on HRD (which is studying the Bill) is available here.  Given below is the summary of our submissions:

Existing Copyright Act

The Indian Copyright Act, 1957 has been designed from the perspective of a developing country. It has always attempted a balance between various kinds of interests. It has always sought to ensure that rights of authors of creative works is carefully promoted alongside the public interest served by wide availability and usability of that material. For instance, our Copyright Act has provisions for:

• compulsory and statutory licensing: recognizing its importance in making works available, especially making them available at an affordable rate.

• cover versions: recognizing that more players lead to a more vibrant music industry.

• widely-worded right of fair dealing for private use: recognizing that individual use and large-scale commercial misuse are different.

These provisions of our Act have been lauded, and India has been rated as the most balanced copyright system in a global survey conducted of over 34 countries by Consumers International.

The Indian Parliament has always sought to be responsive to changing technologies by paying heed to both the democratisation of access as well as the securing of the interests of copyright holders. This approach needs to be lauded, and importantly, needs to be maintained.

Proposed Amendments

Some positive amendments

• Fair Dealings, Parallel Importation, Non-commercial Rental: All works (including sound recordings and cinematograph films) are now covered the fair dealings clause (except computer programmes), and a few other exceptions; parallel importation is now clearly allowed; and non-commercial rental has become a limitation in some cases.

• Persons with disabilities: There is finally an attempt at addressing the concerns of persons with disabilities. But the provisions are completely useless the way they are currently worded.

• Public Libraries: They can now make electronic copies of works they own, and some other beneficial changes relating to public libraries.

• Education: Some exceptions related to education have been broadened (scope of works, & scope of use).

• Statutory and compulsory licensing: Some new statutory licensing provisions (including for radio broadcasting) and some streamlining of existing compulsory licensing provisions.

• Copyright societies: These are now responsible to authors and not owners of works.

• Open licences: Free and Open Source Software and Open Content licensing is now simpler.

• Partial exemption of online intermediaries: Transient and incidental storage of copyrighted works has been excepted, mostly for the benefit of online intermediaries.

• Performer’s rights: The general, and confusing, exclusive right that performers had to communicate their performance to the public has been removed, and instead only the exclusive right to communicate sound/video recordings remains.

• Enforcement: Provisions on border measures have been made better, and less prone to abuse and prevention of legitimate trade.

Some negative amendments

• WCT and WPPT compliance: India has not signed either of these two treaties, which impose TRIPS-plus copyright protection, but without any corresponding increase in fair dealing / fair use rights.

• Increase in duration of copyright: This will significantly reduce the public domain, which India has been arguing for internationally.

• Technological Protection Measures: TPMs, which have been shown to be anti-consumer in all countries in which they have been introduced, are sought to be brought into Indian law.

• Version recordings: The amendments make cover version much more difficult to produce.

• Moral rights: Changes have been made to author’s moral rights (and performer’s moral rights have been introduced) but these have been made without requisite safeguards.

Missed opportunities

• Government-funded works: Taxpayers are still not free to use works that were paid for by them. This goes against the direction that India has elected to march towards with the Right to Information Act.

• Copyright terms: The duration of all copyrights are above the minimum required by our international obligations, thus decreasing the public domain which is crucial for all scientific and cultural progress.

• Criminal provisions: Our law still criminalises individual, non-commercial copyright infringement.

• Libraries and archives: The exceptions for ‘public libraries’ are still too narrow in what they perceive as ‘public libraries’.

• Educational exceptions: The exceptions for education still do not fully embrace distance and digital education.

• Communication to the public: No clear definition is given of what constitute a ‘public’, and no distinction is drawn between commercial and non-commercial ‘public’ communication.

• Internet intermediaries: More protections are required to be granted to Internet intermediaries to ensure that non-market based peer-production projects such as Wikipedia, and other forms of social media and grassroots innovation are not stifled.

• Fair dealing and fair use: We would benefit greatly if, apart from the specific exceptions provided for in the Act, more general guidelines were also provided as to what do not constitute infringement. This would not take away from the existing exceptions.

Special 301 Report: Unbalanced Hypocrisy

The United States Trade Representative has put yet another edition of the Special 301 report which details the copyright law and policy wrongdoings of the US's trading partners. Jeremy Malcolm of Consumers International notes that the report this year claims to be "well-balanced assessment of intellectual property protection and enforcement ... taking into account diverse factors", but:

[I]n fact, the report largely continues to be very one-sided. As in previous editions, it lambasts developing countries for failing to meet unrealistically stringent standards of IP protection that exceed their obligations under international law.

More the report changes, the more it stays the same. Despite having wider consultations than just the International Intellectual Property Alliance (IIPA, consisting of US-based IP-maximalist lobbyists like the Motion Picture Association of America, Recording Industry Association of America, National Music Publishers Association, Association of American Publishers, and Business Software Alliance) and the Pharmaceutical Research and Manufacturers of America (PhRMA, consisting of US-based pharma multinationals), things haven't really changed much in terms of the shoddiness of the Special 301 report.

India and the 2010 Special 301 Report

The Special 301 report for 2010 contains the following assessment of India:

India will remain on the Priority Watch List in 2010. India continues to make gradual progress on efforts to improve its legislative, administrative, and enforcement infrastructure for IPR. India has made incremental improvements on enforcement, and its IP offices continued to pursue promising modernization efforts. Among other steps, the United States is encouraged by the Indian government’s consideration of possible trademark law amendments that would facilitate India’s accession to the Madrid Protocol. The United States encourages the continuation of efforts to reduce patent application backlogs and streamline patent opposition proceedings. Some industries report improved engagement and commitment from enforcement officials on key enforcement challenges such as optical disc and book piracy. However, concerns remain over India’s inadequate legal framework and ineffective enforcement. Piracy and counterfeiting, including the counterfeiting of medicines, remains widespread and India’s enforcement regime remains ineffective at addressing this problem. Amendments are needed to bring India’s copyright law in line with international standards, including by implementing the provisions of the WIPO Internet Treaties. Additionally, a law designed to address the unauthorized manufacture and distribution of optical discs remains in draft form and should be enacted in the near term. The United States continues to urge India to improve its IPR regime by providing stronger protection for patents. One concern in this regard is a provision in India’s Patent Law that prohibits patents on certain chemical forms absent a showing of increased efficacy. While the full import of this provision remains unclear, it appears to limit the patentability of potentially beneficial innovations, such as temperature-stable forms of a drug or new means of drug delivery. The United States also encourages India to provide protection against unfair commercial use, as well as unauthorized disclosure, of undisclosed test or other data generated to obtain marketing approval for pharmaceutical and agricultural chemical products. The United States encourages India to improve its criminal enforcement regime by providing for expeditious judicial disposition of IPR infringement cases as well as deterrent sentences, and to change the perception that IPR offenses are low priority crimes. The United States urges India to strengthen its IPR regime and will continue to work with India on these issues in the coming year.

This short dismissal of the Indian IPR regime, and subsequent classification of India as a "Priority Watch List" country reveals the great many problems with the Special 301.

On Copyrights

1. The report notes that there are "concerns over India's inadequate legal framework and ineffective enforcement". However, nowhere does it bother to point out precisely how India's legal framework is inadequate, and how this is negatively affecting authors and creators, consumers, or even the industry groups (MPAA, RIAA, BSA, etc.) that give input to the USTR via the IPAA. Nor does it acknowledge the well-publicised fact that the statistics put out by these bodies have time and again proven to be wrong.

2. Apart from this bald allegation which has not backing, there is a bald statement about India needing to bring its copyright law "in line with international standards" including "the WIPO Internet Treaties". The WIPO Internet Treaties given that more than half the countries of the world are not signatories to either of the WIPO Internet Treaties (namely the WIPO Copyright Treaty and the WIPO Performance and Phonograms Treaty), calling them 'international standards' is suspect. That apart, both those treaties are TRIPS-plus treaties (requiring protections greater than the already-high standards of the TRIPS Agreement). India has not signed either of them. It should not be obligated to do so. Indeed, Ruth Okediji, a noted copyright scholar, states:

Consistent with their predecessors, the WIPO Internet Treaties marginalize collaborative forms of creative engagement with which citizens in the global South have long identified and continue in the tradition of assuming that copyright’s most enduring cannons are culturally neutral. [...] The Treaties do not provide a meaningful basis for a harmonized approach to encourage new creative forms in much the same way the Berne Convention fell short of embracing diversity in patterns and modes of authorial expression.

1. Some of the of the 'problems' noted in the report are actually seen as being beneficial by many researchers and scholars such as Lawrence Liang, Achal Prabhala, Perihan Abou Zeid and others, who argue that lax enforcement has enabled access to knowledge and promotion of innovation. In a panel on 'Access to Knowledge' at the Internet Governance Forum, Lea Shaver, Jeremy Malcolm and others who have been involved in that Access to Knowledge movement noted that lack of strict enforcement played a positive role in many developing countries. However, they also noted, with a fair bit of trepidation, that this was sought to be changed at the international level through treaties such as the Anti-Counterfeiting Treaty Agreement (ACTA).

2. The scope of an optical disc law are quite different from copyright law. The report condemns "unauthorized manufacture and distribution of optical discs", however it does not make it clear that what it is talking about is not just unlicensed copying of films (which is already prohibited under the Copyright Act) but the manufacture and distribution of blank CDs and DVDs as well. The need for such a law is assumed, but never demonstrated. It is onerous for CD and DVD manufacturers (such as the Indian company Moserbaer), and is an overbearing means of attacking piracy.

3. The report calls for "improve[ment] [of India's] criminal enforcement regime" and for "deterrent" sentences and expeditious judicial disposition of IPR infringement cases. While we agree with the last suggestion, the first two are most unacceptable. Increased criminal enforcement of a what is essentially a private monopoly right is undesirable. Copyright infringment on non-commercial scales should not be criminal offences at all. What would deter people from infringing copyright laws are not "deterrent sentences" but more convenient and affordable access to the copyright work being infringed.

On Patents

Thankfully, this year the Special 301 report does not criticise the Indian Patent Act for providing for post-grant opposition to patent filings, as it has in previous years. However, it still criticises section 3(d) of the Patent Act which ensures that 'evergreening' of drug patents is not allowed by requiring for new forms of known substances to be patented only if "the enhancement of the known efficacy of [the known] substance" is shown. Thus, the US wishes India to change its domestic law to enable large pharma companies to patent new forms of known substances that aren't even better ("enhancement of the known efficacy"). For instance, "new means of drug delivery" will not, contrary to the assertions of the Special 301 report and the worries of PhRMA, be deemed unpatentable.

The United States has been going through much turmoil over its patent system. Reform of the patent system is currently underway in the US through administrative means, judicial means, as well as legislative means. One of the main reasons for this crumbling of the patent system has been the low bar for patentability (most notably the 'obviousness' test) in the United States and the subsequent over-patenting. An American judgment even noted that "anything under the sun that is made by man" is patentable subject matter. It is well-nigh impossible to take American concerns regarding our high patent standards seriously, given this context.

Miscellanea

The harms of counterfeit medicine, as we have noted earlier, are separate issues that are best dealt under health safety regulations and consumer laws, rather than trademark law.

Data exclusivity has been noted to be harmful to the progress of generics, and seeks to extend proprietary rights over government-mandated test data. It is [clear from the TRIPS Agreement][de-trips] that data exclusivity is not mandatory. There are clear rationale against it, and the Indian pharmaceutical industry [is dead-set against it][de-india]. Still, the United States Trade Representative persists in acting as a corporate shill, calling on countries such as India to implement such detrimental laws.

Conclusion

Michael Geist, professor at University of Ottowa astutely notes:

Looking beyond just Canada, the list [of countries condemned by the Special 301 report] is so large, that it is rendered meaningless. According to the report, approximately 4.3 billion people live in countries without effective intellectual property protection. Since the report does not include any African countries outside of North Africa, the U.S. is effectively saying that only a small percentage of the world meet its standard for IP protection. Canada is not outlier, it's in good company with the fastest growing economies in the world (the BRIC countries are there) and European countries like Norway, Italy, and Spain. In other words, the embarrassment is not Canadian law. Rather, the embarrassment falls on the U.S. for promoting this bullying exercise and on the Canadian copyright lobby groups who seemingly welcome the chance to criticize their own country.

His comments apply equally well for India as well.

IIPA's Recommendation for the Special 301 Report

Thankfully, this year IIPA's recommendations have not been directly copied into the Special 301 report. (They couldn't be incorporated, as seen below.) For instance, the IIPA report notes:

The industry is also concerned about moves by the government to consider mandating the use of open source software and software of only domestic origin. Though such policies have not yet been implemented, IIPA and BSA urge that this area be carefully monitored.

Breaking that into two bit:

Open Source

Firstly, it is curious to see industry object to legal non-pirated software. Secondly, many of BSA's members (if not most) use open source software, and a great many of them also produce open source software. [HP][hp-os] and [IBM][ibm-os] have been huge supporters of open source software. Even [Microsoft has an open source software division][ms-os]. [Intel][intel], SAP, Cisco, Dell, Sybase, Entrust, Intuit, Synopsys, Apple, Borland, Cadence, Autodesk, and Siemens are all members of BSA which support open source software / produce at least some open source software. And all BSA members rely on open source software (as part of their core products, their web-server, their content management system, etc.) to a lesser or greater extent. BSA's left hand doesn't seem to know what its right hand -- its members -- are doing. Indeed, the IIPA does not seem to realise that the United States' government itself uses [open source software], and has been urged to look at FOSS very seriously and is doing so, especially under CIO Vivek Kundra. And that may well be the reason why the USTR could not include this cautionary message in the Special 301 report.

Domestic Software

As this insightful article by Nate Anderson in Ars Technica notes:

Open source is bad enough, but a "buy Indian" law? That would be an outrage and surely something the US government would not itself engage in as recently as last year. Err, right?

Furthermore, the IIPA submission do not provide any reference for their claim that "domestic origin" software is being thought of being made a mandatory requirement in governmental software procurement.

WCT, WPPT, Camcording, and Statutory Damages

The IIPA submission also wish that India would:

1. Adopt a system of statutory damages in civil cases; allow compensation to be awarded in criminal cases;
2. Adopt an optical disc law;
3. Enact Copyright Law amendments consistent with the WCT and WPPT;
4. Adopt an anti-camcording criminal provision.

Quick counters:

1. Statutory damages (that is, an amount based on statute rather than actual loss) would result in ridiculousness such as the $1.92 million damages that the jury (based on the statutory damages) slapped on Jammie Thomas. The judge in that case called the damage award "monstrous and shocking" and said that veered into "the realm of gross injustice."
2. The reasons against an optical disc law are given above. Quick recap: it is a) unnecessary and b) harmful.
3. India has not signed the WCT and the WPPT. Indian law satisfies all our international obligations. Thus enacting amendments consistent with the WCT and the WPPT is not required.
4. Camcording of a film is in any case a violation of the Copyright Act, 1957, and one would be hard-pressed to find a single theatre that allows for / does not prohibit camcorders. Given this, the reason for an additional law is, quite frankly, puzzling. At any rate, IIPA in its submission does not go into such nuances.

Further conclusions

Shamnad Basheer, an IP professor at NUJS, offer the following as a response:

"Dear USA,

India encourages you to mind your own business. We respect your sovereignty to frame IP laws according to your national priorities and suggest that you show us the same courtesy. If your grouse is that we haven't complied with TRIPS, please feel free to take us to the WTO dispute panel. Our guess is that panel members familiar with the English language will ultimately inform you that section 3(d) is perfectly compatible with TRIPS. And that Article 39.3 does not mandate pharmaceutical data exclusivity, as you suggest! More importantly, at that point, we might even think of hauling you up before the very same body for rampant violations, including your refusal to grant TRIPS mandated copyright protection to our record companies, despite a WTO ruling (Irish music case) against you.

Yours sincerely,

India."

Basheer's suggestion seems to be in line with that Michael Geist who believes that other countries should join Canada and Israel in openly refusing to acknowledge the validity of the Special 301 Reports because they lack ['reliable and objective analysis'][geist-reliable]. And that thought serves as a good coda.

Dowload the pdf

Read the original article in the Law and Development Review

Technological Protection Measures are sought to be introduced in India via the Copyright (Amendment) Bill, 2010. This should be quite alarming for consumers for reasons that will be explained in a separate blog post on TPMs that will follow shortly.

In this post, I will restrict myself to a legal exegesis of section 65A of the Bill, which talks of "protection of technological measures". (Section 65B, which talks of Right Management Information will, similarly, be tackled in a later blog post.)

First off, this provision is quite unnecessary. There has been no public demand in India for TPMs to be introduced, and the pressure has come mostly from the United States in the form of the annual "Special 301" report prepared by the United States Trade Representative with input coming (often copied verbatim) from the International Intellectual Property Alliance. India is not a signatory to the WIPO Copyright Treaty (WCT) which requires technological protection measures be safeguarded by law. That provision, interestingly, was pushed for by the United States in 1996 when even it did not give legal sanctity to TPMs via its copyright law (which was amended in 2000 by citing the need to comply with the WCT).

TPMs have been roundly criticised, have been shown to be harmful for consumers, creators, and publishers, and there is also evidence that TPMs do not really decrease copyright infringement (but instead, quite perversely through unintended consequences, end up increasing it). Why then would India wish to introduce it?

Leaving that question aside for now, what does the proposed law itself say?

65A. Protection of Technological Measures

    (1) Any person who circumvents an effective technological measure applied for the purpose of protecting any of the rights conferred by this Act, with the intention of infringing such rights, shall be punishable with imprisonment which may extend to two years and shall also be liable to fine.

    (2) Nothing in sub-section (1) shall prevent any person from:

        (a) doing anything referred to therein for a purpose not expressly prohibited by this Act:

          Provided that any person facilitating circumvention by another person of a technological measure for such a purpose shall maintain a complete record of such other person including his name, address and all relevant particulars necessary to identify him and the purpose for which he has been facilitated; or

        (b) doing anything necessary to conduct encryption research using a lawfully obtained encrypted copy; or

        (c) conducting any lawful investigation; or

        (d) doing anything necessary for the purpose of testing the security of a computer system or a computer network with the authorisation of its owner; or

        (e) operator; or [sic]

        (f) doing anything necessary to circumvent technological measures intended for identification or surveillance of a user; or

        (g) taking measures necessary in the interest of national security.

Implications: The Good Part

This provision clearly takes care of two of the major problems with the way TPMs have been implemented by the Digital Millennium Copyright Act (DMCA) in the United States:

• In s.65A(1) it aligns the protection offered by TPMs to that offered by copyright law itself (since it has to be "applied for the purpose of protecting any of the rights conferred by this Act"). Thus, presumably, TPMs could not be used to restrict access, only to restrict copying, communication to the public, and that gamut of rights.

• In s.65A(1) and 65A(2) it aligns the exceptions granted by copyright law with the exceptions to the TPM provision. Section 65A(1) states that the act of circumvention has to be done "with the intention of infringing ... rights", and s.52(1) clearly states that those exceptions cannot be regarded as infringement of copyright. And s.65A(2)(a) states that circumventing for "a purpose not expressly prohibited by this Act" will be allowed.

A third important difference from the DMCA is that

• It does not criminalise the manufacture and distribution of circumvention tools (including code, devices, etc.). (More on this below.)

Implications: The Bad Part

This provision, despite the seeming fair-handed manner in which it has been drafted, still fails to maintain the balance that copyright seeks to promote:

• TPM-placers (presumably, just copyright holders, because of point 1. above) have been given the ability to restrict the activities of consumers, but they have not been given any corresponding duties. Thus, copyright holders do not have to do anything to ensure that the Film & Telivision Institute of India professor who wishes to use a video clip from a Blu-Ray disc can actually do so. Or that the blind student who wishes to circumvent TPMs because she has no other way of making it work with her screen reader is actually enabled to take advantage of the leeway the law seeks to provide her through s.52(1)(a) (s.52(1)(zb) is another matter!). Thus, while there are many such exceptions that the law allows for, the technological locks themselves prevent the use of those exceptions. Another way of putting that would be to say:

• The Bill presumes that every one has access to all circumvention technology. This is simply not true. In fact, Spanish law (in Article 161 of their law) expressly requires that copyright holders facilitate access to works protected by TPM to beneficiaries of limitations of copyright. Thus, copyright holders who employ TPMs should be required to:

  • tell their customers how they can be contacted if the customer wishes to circumvent the TPM for a legitimate purpose
  • upon being contacted, aid their customer in making use of their rights / the exceptions and limitations in copyright law

• How seriously can you take a Bill that has been introduced in Parliament that includes a provision that states: "Nothing in sub-section (1) shall prevent any person from operator; or" (as s.65A(2)(e), read in its entirety, does)?

Uncertainties

As mentioned above, the provisions are not all that clear regarding manufacture and distribution of circumvention tools. Thus, the proviso to s.65A(2)(a) deserves a closer reading. What is clear is that there are no penalties mentioned for manufacture or dissemination of TPMs, and that only those who circumvent are penalised in 65A(1), and not those who produce the circumvention devices. However:

On "shall maintain" and penalties

In the proviso to s.65B(2)(a), there is an imperative ("shall maintain") requiring "any person facilitating circumvention" to keep records. It is unclear what the implications of not maintaining such records are.

The obvious one is that the exemption contained in s.65(1)(a) will not apply if one were facilitated without the facilitator keeping records. Thus, under this interpretation, there is no independent legal (albeit penalty-less) obligation on facilitators. This interpretation runs into the problem that if this was the intention, then the drafters would have written "Provided that any person facilitating circumvention ... for such a purpose maintain/maintained a complete record ...". Instead, shall maintain is used, and an independent legal obligation seems, thus, to be implied. But can a proviso create an independent legal obligation? And is there any way a penalty could possibly be attached to violation of this proviso despite it not coming within 65A(1)?

On "facilitating" and remoteness

The next question is who all can be said to "facilitate", and how remote can the connection be? Is the coder who broke the circumvention a facilitator? The distributor/trafficker? The website which provided you the software? Or is it (as is more likely) a more direct "the friend who sat at your computer and installed the circumvention software" / "the technician who unlocked your DVD player for you while installing it in your house"?

While such a record-keeping requirement is observable by people those who very directly help you (the last two examples above), it would be more difficult to do so the further up you get on the chain of remoteness. Importantly, such record-keeping is absolutely not possible in decentralized distribution models (such as those employed by most free/open source software), and could seriously harm fair and legitimate circumvention.

More uncertainties

It is slightly unclear which exception the bypassing of Sony's dangerous "Rootkit" copy protection technology would fall under if I wish to get rid of it simply because it makes my computer vulnerable to malicious attacks (and not to exercise one of the exceptions under s.52(1)). Will such circumvention come under s.65A(2)(a)? Because it does not quite fall under any of the others, including s.65(2)(b) or (f).

On "purpose" as a criterion in 65A(2)(a)

A last point, which is somewhat of an aside is that 65A(2)(a) states: > Nothing in sub-section (1) shall prevent any person from doing anything referred to therein for a purpose not expressly prohibited by this Act.

There's something curious about the wording, since the Copyright Act generally does not prohibit any acts based on purposes (i.e., the prohibitions by ss.14 r/w s.51 are not based on why someone reproduces, etc., but on the act of reproduction). In fact, it allows acts based on purposes (via s.52(1)). The correct way of reading 65A(2)(a) might then be: > Nothing in sub-section (1) shall prevent any person from doing anything referred to therein for a purpose expressly allowed by this Act.

But that might make it slightly redundant as s.65A(1) covers that by having the requirement of the circumvention being done "with the intention of infringing such right" (since the s.52(1) exceptions are clearly stated as not being infringements of the rights granted under the Act).

Conclusion

It would be interesting to note how leading copyright lawyers understand this provision, and we will be tracking such opinions. But it is clear that TPMs, as a private, non-human enforcement of copyright law, are harmful and that we should not introduce them in India. And we should be especially wary of doing so without introducing additional safeguards, such as duties on copyright holder to aid access to TPM'ed works for legitimate purposes, and remove burdensome record-keeping provisions.

For centuries, copyright law has existed to protect creative production whilst promoting public access. But the digital age is challenging this balance and fundamentally changing how we produce, access and distribute content. Suddenly, copyright rules no longer do what they are supposed to do. They have gone bad.

This is a film about how copyright has become one of the most important consumer issues of the digital age; why corporate lobbying risks criminalising the actions of hundreds of thousands of people; and what the future holds for the fight for fairer copyright laws.

When Copyright Goes Bad is an introduction to the renegotiation of copyright and is for anyone interested in how copyright is affecting consumers. It features some of the key players in the copyright debate, including: Fred Von Lohmann - Electronic Frontier Foundation; Michael Geist - University of Ottawa Law School; Jim Killock - Open Rights Group; and Hank Shocklee - Co-founder of Public Enemy.

Quotes from When Copyright Goes Bad

“People have realised that copyright affects them every day and the direction that we’ve seen over the last few years really troubles them.  That’s why so many people are speaking out.” Michael Geist

“In the U.S, over 35,000 Americans were targeted for lawsuits for downloading music.  In ten years time, everyone will look back at that as incredibly unjust and ridiculous.  No-one thinks that suing music fans one at a time is the business model of the future.” Fred Von Lohmann

“The industry is trying to demonise consumer behaviour.  They’re trying to create the idea that it’s a moral debate: is downloading something wrong or right?  Is it theft or not?  These are the wrong questions and they will only ever produce the wrong answers.” Jim Killock

Making copyright, right

When Copyright Goes Bad is being released under a Creative Commons (CC) licence, which means it’s free to copy and adapt, as long as content is attributed and the same CC licence is used.
We will also be making available extended interviews with all the contributors, as well as with other experts not featured in the film, under the same CC licence at A2Knetwork.org/film. By providing access in this way we are allowing others to go on and create further work around the issue.

View it on youtube

This blog post is based on a presentation made at the iTechLaw conference held on February 5, 2010. The audience consisted of lawyers from various corporations and corporate law firms. As is their wont, most lawyers when dealing with software patents get straight to an analysis of law governing the patenting of computer programmes in India and elsewhere, and seeing whether any loopholes exist and can be exploited to patent software. It was refreshing to see at least some lawyers actually going into questions of the need for patents to cover computer programs. In my presentation, I made a multi-pronged case against software patents: (1) philosophical justification against software patents based on the nature of software; (2) legal case against software patents; (3) practical reasons against software patents.

Preamble

Through these arguments, it is sought to be shown that patentability of software is not some arcane, technical question of law, but is a real issue that affect the continued production of new software and the everyday life of the coder/hacker/software programmer/engineer as well as consumers of software (which is, I may remind you, everywhere from your pacemaker to your phone). A preamble to the arguments would note that the main question to ask is: why should we allow for patenting of software? Answering this question will lead us to ask: who benefits from patenting of software. The conclusion that I come to is that patenting of software helps three categories of people: (1) those large software corporations that already have a large number of software patents; (2) those corporations that do not create software, but only trade in patents / sue on the basis of patents ("patent trolls"); (3) patent lawyers. How they don't help small and medium enterprises nor society at large (since they deter, rather than further invention) will be borne out by the rest of these arguments, especially the section on practical reasons against software patents.

What are Patents?

Patents are a twenty-year monopoly granted by the State on any invention. An invention has to have at least four characteristics: (0) patentable subject matter; (1) novelty (it has to be new); (2) inventive step / non-obviousness (even if new, it should not be obvious); (3) application to industry. A monopoly over that invention, thus means that if person X has invented something, then I may not use the core parts of that invention ("the essential claims") in my own invention. This prohibition applies even if I have come upon my invention without having known about X's invention. (Thus, independent creation is not a defence to patent infringement. This distinguishes it, for instance, from copyright law in which two people who created the same work independently of each other can both assert copyright.) Patents cover non-abstract ideas/functionality while copyright covers specific expressions of ideas. To clarify: imagine I make a drawing of a particular machine and describe the procedure of making it. Under patent law, no one else can make that particular machine, while under copyright law, no one can copy that drawing.

Philosophical Justification Against Software Patents

Even without going into the case against patents per se (lack of independent creation as a defence; lack of 'harm' as a criterion leading to internalization of all positive externalities; lack of effective disclosure and publication; etc.), which has been done much more ably by others like Bessen & Meurer (especially in their book Patent Failure) and Boldrin & Levine (in their book Against Intellectual Monopoly, the full text of which is available online).

But there is one essentially philosophical argument against software as subject matter of a patent. Software/computer programs ("instructions for a computer"), as any software engineer would tell you, are merely algorithms ("an effective method for solving a problem using a finite sequence of instructions") that are meant to be understood by a computer or a human who knows how to read that code.

Algorithms are not patentable subject matter, as they are mere expressions of abstract ideas, and not inventions in themselves. Computer programs, similarly, are abstract ideas. They only stop being abstract ideas when embodied in a machine or a process in which it is the machine/process that is the essential claim and not the software. That machine or process being patented would not grant protection to the software itself, but to the whole machine or process. Thus the abstract part of that machine/process (i.e., the computer program) could be used in any other machine/process, as it it is not the subject matter of the patent. Importantly, just because software is required to operate some machine would then not mean that the machine itself is not patentable, just that the software cannot be patented in guise of patenting a machine.

Legal Case Against Software Patents

In India, section 3(k) of the Patent Act reads:

(3) The following are not inventions within the meaning of this Act: (k) a mathematical or business method or computer programme (sic) per se or algorithms.

As one can see, computer programs are place in the same category as "mathematical methods", "algorithms", and "business methods", hence giving legal validity to the idea propounded in the previous section that computer programs are a kind of algorithms (just as algorithms are a kind of mathematical method).

Be that as it may, the best legal minds in India have had to work hard at understanding what exactly "computer programme per se" means. They have cited U.S. case law, U.K. case law, E.U. precedents, and sought to arrive at an understanding of how per se should be understood. While understanding what per se means might be a difficult job, it is much easier to see what it does not mean. For that, we can look at the 2004 Patent Ordinance that Parliament rejected in 2005. In that ordinance, sections 3(k) and (ka) read as follows:

(3) The following are not inventions within the meaning of this Act: (k) a computer programme per se other than its technical application to industry or a combination with hardware; (ka) a mathematical method or a business method or algorithms.

Thus, it is clear that the interpretation that "computer programme per se" excludes "a computer programme that has technical application to industry" and "a computer programme in combination with hardware" is wrong. By rejecting the 2004 Ordinance wording, Parliament has clearly shown that "technical application to industry" and "combination with hardware" do not make a computer programme patentable subject matter.

Indeed, what exactly is "technical application to industry"? "Technical" has various definitions, and a perusal through those definitions would show that barely any computer program can be said not to relate to a technique, not involve "specialized knowledge of applied arts and sciences" (it is code, after all; not everyone can write good algorithms), or not relate to "a practical subject that is organized according to scientific principles" or is "technological". Similarly, all software is, by definition, meant to be used in combination with hardware. Thus, it being used in combination with hardware must not, as argued above, give rise to patentability of otherwise unpatentable subject matter category.

In 2008, the Patent Office published a new 'Draft Manual Of Patent Practice And Procedure' in which it sought to allow patenting of certain method claims for software inventions (while earlier the Patent Office objected to method claims, allowing only device claims with hardware components). This Draft Manual was withdrawn from circulation, with Shri N.N. Prasad (then Joint Secretary of DIPP, the department administering the Patent Office) noting that the parts of the Manual on sections 3(d) and 3(k) had generated a lot of controversy, and were ultra vires the scope of the Manual (which could not override the Patent Act). He promised that those parts would be dropped and the Manual would be re-written. A revised draft of the Manual has not yet been released. Thus the interpretation provided in the Draft Manual (which was based heavily on the interpretation of the U.K. courts) cannot not be relied upon as a basis for arguments in favour of the patentability of software in India.

In October 2008, CIS helped organize a National Public Meeting on Software Patents in which Indian academics, industry, scientists, and FOSS enthusiasts all came to the conclusion that software patents are harmful for both the industry as well as consumers.

Practical Reasons Against Software Patents

This is going to be an attempt at distilling and simplifying some of the main practical arguments against patenting of software.

There are traditionally four incentives that the patent system caters to: (1) incentive to invent; (2) incentive to disclose; (3) incentive to commercialize; and (4) incentive to invent substitutes. Apart from the last, patenting of software does not really aid any of them.

1. Patent Landmines / Submarine Patents / Patent Gridlocks / No Exception for Independent Creation

   Given that computer programs are algorithms, having monopolies over such abstract ideas is detrimental to innovation. Just the metaphors say a lot about software patents: landmines (they cannot be seen/predicted); submarines (they surface out of the blue); gridlocks (because there are so many software patents around the same area of computing, they prevent further innovation in that area, since no program can be written without violating one patent or the other).

   Imagine the madness that would have ensued had patents been granted when computer programming was in its infancy. Imagine different methods of sorting (quick sort, bubble sort) that are part of Computer Science 101 had been patented. While those particular instances aren't, similar algorithms, such as data compression algorithms (including the infamous LZW compression method), have been granted patents. Most importantly, even if one codes certain functionality into software independently of the patent holder, that is still violative of the patent. Computer programs being granted patents makes it extremely difficult to create other computer programs that are based on the same abstract ideas. Thus incentives # (1) and (3) are not fulfilled, and indeed, they are harmed. There is no incentive to invent, as one would always be violating one patent or the other. Given that, there is no incentive to commercialize what one has invented, because of fear of patent infringement suits.

   An apt illustration of this is the current difficulty of choosing a royalty-free video format for HTML 5, as it shows, in practical terms, how difficult it is to create a video format without violating one patent or the other. While the PNG image format was created to side-step the patent over the LZW compression method used in the GIF image format, bringing Ogg Theora or Dirac (both patent-free video format) to surpass the levels of H.264/MPEG-4 AVC or VC-1 will be very difficult without infringing dozens if not hundreds of software patents. Chris DiBona of Google, while talking about improving Ogg Theora as part of its inclusion in HTML 5 specifications said, "Here’s the challenge: Can Theora move forward without infringing on the other video compression patents?" Just the number of companies and organization that hold patents over H.264 is astounding, and includes: Columbia University, Electronics and Telecommunications Research Institute of Korea (ETRI), France Télécom, Fujitsu, LG Electronics, Matsushita, Mitsubishi, Microsoft, Motorola, Nokia, Philips, Robert Bosch GmbH, Samsung, Sharp, Sony, Toshiba, and Victor Company of Japan (JVC). As is the amount of royalties to be paid ("[t]he maximum royalty for these rights payable by an Enterprise (company and greater than 50% owned subsidiaries) is $3.5 million per year in 2005-2006, $4.25 million per year in 2007-08 and $5 million per year in 2009-10"; with royalty per unit of a decoder-encoder costing upto USD 0.20.)

   Indeed, even the most diligent companies cannot guard themselves against software patents. FFII estimates that a very simple online shopping website would violate twenty different patents at the very least. Microsoft recently lost a case against i4i when i4i surfaced with a patent covering custom XML as implemented in MS Office 2003 and MS Office 2007. As a result Microsoft had to ship patches to its millions of customers, to disable the functionality and bypass that patent. The manufacturers of BlackBerry, the Canadian company Research in Motion, had to shell out USD 617 million as settlement to NTP over wireless push e-mail, as it was otherwise faced with the possibility of the court shutting down the BlackBerry service in the U.S. This happened despite there being a well-known method of doing so pre-dating the NTP patents. NTP has also filed cases against AT&T, Sprint Nextel, T-Mobile, Verizon Wireless, and Palm Inc. Microsoft was also hit by Visto Corporation over those same NTP patents, which had been licensed to Visto (a startup).

   • Don't These Cases Show How Software Patents Help Small Companies?

     The astute reader might be tempted to ask: are not all of these examples of small companies getting their dues from larger companies? Doesn't all of this show that software patents actually help small and medium enterprises (SMEs)? The answer to that is: no. To see why, we need to note the common thread binding i4i, NTP, and Visto. None of them were, at the time of their lawsuits, actually creating new software, and NTP was an out-and-out "non-practising entity"/"patent holding company" AKA, patent troll. i4i was in the process of closing shop, and Visto had just started up. None of these were actually practising the patent. None of these were producing any other software. Thus, none of these companies had anything to lose by going after big companies. In other words, the likes of Microsoft, RIM, Verizon, AT&T, etc., could not file counter-suits of patent infringement, which is normally what happens when SMEs try to assert patent rights against larger corporations. For every patent that the large corporation violates of the smaller corporation, the smaler corporation would be violating at least ten of the larger corporation's. Software patents are more helpful for software companies as a tool for cross-licensing rather than as a way of earning royalties. Even this does not work as a strategy against patent trolls.

   Thus, the assertion that was made at the beginning is borne out: software patents help only patent trolls, large corporations that already have large software patent portfolios, and the lawyers who draft these patents and later argue them out in court.

2. Term of Patents

   Twenty years of monopoly rights is outright ludicrous in an industry where the rate of turnover of technology is much faster -- anywhere between two years and five months.

3. Software Industry Progressed Greatly Without Patents

   In India, software patents have never been asserted in courts (even though many have been illegally granted), yet the software industry in India is growing in leaps and bounds. Similarly, most of the big (American) giants of the software industry today grew to their stature by using copyright to "protect" their software, and not patents.

4. Copyright Exists for Software

   As noted above, the code/expression of any software is internationally protected by copyright law. There is no reason to protect the ideas/functionality of that software as well.

5. Insufficient Disclosure

   When ordinary computer programmers cannot understand what a particular software patent covers (which is the overwhelming case), then the patent is of no use. One of the main incentives of the patent system is to encourage gifted inventors to share their genius with the world. It is not about gifted inventors paying equally gifted lawyers to obfuscate their inventions into gobbledygook so that other gifted inventors can at best hazard a guess as to precisely what is and is not covered by that patent. Thus, this incentive (#2) is not fulfilled by the current system of patents either -- not unless there is a major overhaul of the system. This ties in with the impossibility of ensuring that one is not violating a software patent. If a reasonably smart software developer (who are often working as individuals, and as part of SMEs) cannot quickly ascertain whether one is violating patents, then there is a huge disincentive against developing software in that area at all.

6. Software Patents Work Against Free/Libre/Open Source Software

   Software patents hinder the development of software and FOSS licences, as the licensee is not allowed to restrict the rights of the sub-licensees over and above the restrictions that the licensee has to observe. Thus, all patent clearances obtained by the licensee must be passed on to the sub-licensees. Thus, patented software, though most countries around the world do not recognize them, are generally not included in the default builds of many FOSS operating systems. This inhabits the general adoption of FOSS, since many of the software patents, even though not enforceable in India, are paid heed to by the software that Indians download, and the MP3 and DivX formats are not enabled by default in standard installations of a Linux OS such as Ubuntu.

Conclusion

Currently, the U.S. patent system is being reviewed at the administrative level, the legislative level, as well as the judicial level. At the judicial level, the question of business method patents (and, by extension, software patents) is before the Supreme Court of the United States of America in the form of Bilski v. Kappos. Judge Mayer of the Court of Appeals for the Federal Circuit (CAFC, which heard In re Bilksi) noted that "the patent system has run amok". The Free Software Foundation submitted a most extensive amicus curiae brief to the U.S. Supreme Court, filled with brilliant analysis of software patents and arguments against the patentability of software that is well worth a read.

CIS Statement on the WIPO Broadcast Treaty at SCCR 19

The Centre for Internet and Society believes that the protection that may be afforded to broadcasters under existing international treaties, including Article 14 of the TRIPS Convention, are sufficient to safeguard the interests of broadcasters, and that the Broadcast Treaty, which has been under discussion for more than a decade without any progress, is, as the WIPO Chair observed, an expenditure of "time, energy and resources to no avail" (SCCR/15/2/rev).

We believe that at any rate webcasting/netcasting should be kept out of the ambit of the broadcast treaty, even if only restricted to "retransmission" of broadcasts as in the current draft, since by its very nature webcasting is very different from broadcasting. Webcasting is currently quite vibrant, with a recent report by Arbor Networks estimating that around ten per cent of all Web traffic is streaming video, making webcasting the fastest growing application on the Internet.  Given this situation, a strong case has to be made to show that an international treaty is required to protect and promote webcasting, which has not been done.

Specifically, we believe that Paragraph 16 of the WIPO Development Agenda, which relates to preservation of a vibrant public domain, will be endangered by a right being given to webcasters which is separate from the underlying content of the transmission.

Statements by other organizations on WIPO Broadcast Treaty at SCCR 19

• Electronic Frontier Foundation
  
• Public Knowledge
• International Federation of Library Associations, Electronic Information for Libraries, and Library Copyright Alliance (Joint Statement)
  
• Computer and Communications Industry Association
  

Special ‘301’ Reports

The ‘Special 301 Reports’ are published annually by the office of the United States Trade Representative (USTR) to examine ‘in detail the adequacy and effectiveness of intellectual property rights protection’ in countries around the globe. Sections 301-310 of the Trade Act of 1974, as amended by the Omnibus Trade and Competitiveness Act of 1988, empower the USTR ‘to identify foreign countries that deny adequate and effective protection of intellectual property rights or fair and equitable market access for U.S. persons that rely on intellectual property protection.’    

India has faced considerable pressure to amend and enforce its copyright laws, more to the needs of the United States rather than reflecting the needs of its population, businesses and innovation. The 301 reports over the last decade have been largely concerned with the general problems of counterfeit and piracy in India, unlike China where specific laws adopted and enforced by the state have been critiqued. Over the course of the decade, according to the reports, the United States has been concerned with a large number of subjects including the backlog and inadequacy of India’s legal system, lack of enforcement of IP protections for media oriented products like ‘motion pictures, music, software, books and video games’, need for stronger protection of copyrights, trademarks and patents, optical media and procedural inadequacies. In 2004 the USTR reported, ‘copyright piracy is rampant, and the U.S. copyright industry estimates that lost sales resulting from piracy in India of U.S. motion pictures, sound recordings, musical compositions, computer programmes, and books totaled approximately $500 million in 2004.’

The United States articulates the reasons for concern in India – the challenge posed by Indian pirated and counterfeit goods entering American markets. It expresses its concern for lack of piracy enforcement as ‘‘growing concern for U.S. copyright industries, especially given the pirated imports are entering the market from Southeast Asia.

Over the past few years, it has also included suggestions of taking criminal action against those engaging in copyright infringement. India’s supposed ‘weak’ criminal system is mentioned in the 2008 reports, focused specifically on the need for a greater police presence enforcing IPR infringements through criminal means and ‘stronger’ border control.

The Effects of Counterfeiting and Piracy on India’s Entertainment Industry

Published in March 2009 by United States-India Business Council (USIBC) and prepared by Ernst and Young India, claims that as much as Rs.16, 000 crores are lost due to piracy. Alongside, as many as 80,000 jobs are lost directly as a result of theft and piracy, afflicting India’s entertainment industry. This report was commissioned as a part of the USIBC–FICCI Bollywood–Hollywood initiative and covered film, music, television and video games. It was funded by the Global Intellectual Property Center of the U.S. Chamber of Commerce. The spectacular press launch meeting was organized in Mumbai and also attended by Yash Chopra, chairman of FICCI Frames and Ramesh Sippy, the famed director who commented on the occasion, “I know first hand the importance of fighting piracy to support the growth of Bollywood. I commend the USIBC–FICCI initiative for enlisting all elements of the entertainment industry against piracy.” The President of USIBC, Ron Summers used the opportunity to suggest stronger legal means to tackle piracy. He said, “We strongly support passage by India of optical disc legislation that will thwart piracy in this important industry. We are pleased to stand shoulder to shoulder with counterparts in India to help protect jobs and revenues that are now being needlessly lost to piracy.”

Sixth Annual BSA and IDC Global Software Piracy Study

Business Software Alliance, in partnership with a market analysis firm IDC, published their annual study on global trends in software piracy in May 2009. Sixth in its annual series, the report critically blames the Asia Pacific region, especially India and China, for the growing levels in piracy, despite countries bringing down their piracy rates. The report says, ‘In 2008, the rate of PC software piracy dropped in slightly more than half (57) of the 110 countries studied, remained the same in nearly one third (36), and rose in just 16. However, the worldwide PC software piracy rate rose for the second year in a row, from 38 per cent to 41 per cent, mainly because PC shipments grew fastest in high-piracy countries such as China and India, overwhelming progress in these and other countries.’

In addition, it also makes an India specific point by highlighting India’s piracy trends,

‘India’s rate has dropped six points in five years, despite its sprawling PC market, of which consumers and small businesses account for 65 per cent. While consumer PC shipments grew more than 10 per cent last year, shipments to other categories dropped 7 per cent.’

Motion Pictures Distributors Association’s Internet Piracy Studies

Earlier this month, the MPA Office in India named Motion Pictures Distributors Association, along with a DtecNet a global anti-piracy company, released a study on the Internet piracy trends in India. This report places India as the fourth largest global hub of online film piracy, behind United States, Britain and Canada, with Delhi, Bangalore and Mumbai accounting for the major share of illegal downloads. It estimates that Vishal Bhardwaj’s Kaminey, was downloaded 350, 000 times on Bit Torrent with about 2/3rds of downloaders being from India. MPDA also links this study to another consultancy, Envisional’s similar suggestions, while MPDA’s managing director, Rajiv Dalal pushed for strong laws to support copyright, strong enforcement and stiff sentences for people who violate laws, on the basis of these reports.

Despite the availability of a large number of critiques available in the academic world, the media – both broadcast and print, reports shock inducing statistics verbatim, treating them as expert evidence without engaging in any analysis of the published material. Most of the piracy studies are quantitative in nature and do not provide any social class or demographic break up either of those who engage in piracy or those who buy pirated goods. It has also been pointed out by scholars like Shujen Wang that it is unreasonable to assume that every pirated copy could be counted as a lost sale, and thus a loss. In absence of research on the cultural aspects of piracy and the subsequent circulation, these reports have been successful in creating a fear psychosis in the civil society.

International Intellectual Property Alliance

The International Intellectual Property Alliance (IIPA) is an international lobby group of US media industries with close ties to the United States Trade Representative. It has in its reports consistently expressed dissatisfaction with Indian efforts to deal with piracy.  IIPA works in close cooperation the other US lobby groups like the MPAA (Motion Picture Association of America) and the BSA (Business Software Alliance). The IIPA reports, which place India in a 'danger zone', significantly influence regional and international discourses on piracy.  Interestingly, the IIPA in India has been very successful in regionalizing and nationalizing a global discourse. Thus, in the past few years, local industry associations in India in cinema, music and software have independently run highly emotional campaigns against piracy, reminiscent of IIPA's own campaigns. 

Motion Pictures Association

The Motion Picture Association of America (MPAA) through its international counterpart, Motion Pictures Association (MPA), has been unofficially operational in India for the last 15 years. Its member companies are Walt Disney, Paramount, Sony Entertainment, Twentieth Century Fox, Universal Studios, and Warner Bros. The MPA's work in India was mostly non-obtrusive till 1994 when MPA Asia-Pacific, based in Singapore, started being represented by the high profile legal firm Lall & Sethi Advocates.

They have collectively worked on forming enforcement teams for coordinated raids in Mumbai and Delhi since 1995. Earlier this year, MPA announced its first India office to be set up in Mumbai, called the Motion Picture Distributor's Association India (Pvt.) Limited (MPDA), under the directorship of Rajiv Dalal.  Mr. Dalal had previously directed strategic initiatives from the MPAA's Los Angeles office.  The MPDA will engage itself in working jointly with local Indian film industries and the Indian government to promote the protection of motion pictures and television rights. 

According to the organization's own assertion, in 2006 the MPA's Asia-Pacific operation investigated more than 30,000 cases of piracy and assisted law enforcement officials in conducting nearly 12,400 raids. These activities resulted in the seizure of more than 35 million illegal optical discs, 50 factory optical disc production lines and 4,482 optical disc burners, as well as the initiation of more than 11,000 legal actions.

Indian Music Industry

The world's second-oldest music companies' association, Indian Music Industry (IMI), was first established as Indian Phonographic Industry in 1936. It was re-formed in its present avatar in 1994, as a non-commercial and non-profit organization affiliated to the International Federation of Phonographic Industry (IFPI) and is registered as a society in West Bengal. IMI members includes major record companies like Saregama, HMV, Universal Music (India), Tips, Venus, Sony BMG (India), Crescendo, Virgin Records, Magnasound, Milestone, Times Music and several other prominent national and regional labels that represent over 75 per cent of the output in corporate recordings.

It was one of the first organizations in the country to start the trend of hiring ex-police officers to lead anti-piracy operations. In 1996, IMI hired Julio Ribeiro (a former Commissioner of Police, Mumbai; Director General of Police, Punjab; and Indian Ambassador to Romania) to head its anti-piracy operations. Their anti-piracy work is split into three specific regions, North and North Eastern, Western and Southern and East, each zone headed by a former senior police officer. IMI operates through offices in Kolkata, Mumbai, New Delhi, Chennai, Bangalore and several other cities and towns across India, focusing on surveillance, law enforcement, and gathering intelligence through an 80 member team hired to tackle piracy. During 2001 to 2004, IMI registered over 5500 cases, seized over 10 lakh music cassettes, and around 25 lakh CDs.

Business Software Alliance

Headquartered in Washington DC, the Business Software Alliance has a regional office in Delhi, and has been instrumental in conducting anti-piracy operations across the country. According to the BSA, India ranks 20 in global software piracy rankings, with a rate of 73 per cent while the Asia Pacific average is 53 per cent. China ranks second with a rate of 92 per cent and annual losses of $3,823 million while Pakistan ranks nine with 83 per cent piracy rate. They have engaged the general public in providing them with information on pirated software through an anti-piracy initiative – The Rewards Programme. Launched in 2005, reward amount up to Rs.50, 000, would be provided for information leading to successful legal action against companies using unlicensed software. The reward program was aimed to encourage people to support the fight against piracy and to report software piracy to the NASSCOM-BSA Anti-Piracy Software Hotline.

In 2006, BSA and NASSCOM got a shot in their arms by winning the largest settlement amount for a copyright case in India, with Netlinx India Pvt. Ltd. The case had emerged after a civil raid was conducted at the premises of Netlinx in December 2000, leading to inspection and impounding of 40 PCs, carrying illegal unlicensed software. The settlement includes damages of US$ 30,000, complete legalization of software used by them, removal of all unlicensed/pirated software and submission to an unannounced audit of computer systems during next 12 months.

Industry Enforcers

Bollywood Film and Music companies, such as T-Series and Yashraj Films, have established anti-piracy arms to combat piracy in specific markets. T-Series has been in the industry for over 15 years, as a brand of Gulshan Kumar founded Super Cassettes Industries Limited, and has often been at the forefront for conducting raids along with police officials to check piracy of its copyrighted content. In its latest announcement earlier this year, T-Series launched an anti-piracy campaign against those stealing digital content. The announcement came after they filed a complaint on June 1 with a police station in Mangalore against Classic Video shop for infringement of its copyright works like Billu, Ghajini, Aap Ka Suroor, Apne, Fashion and Karz that had been illegally downloaded and copied onto multiple discs, card readers and pen-drives.

Yashraj Films, a leading film studio, has long been a part of enforcement activities against piracy, both in the Indian market and internationally. Most recently, it was a key member in the formation of the United Producers and Distributors Forum, which also included chairman Mahesh Bhatt, Ramesh Sippy, Ronnie Screwalla of UTV, Shah Rukh Khan, Aamir Khan and Eros International. This organization is now trying to enforce anti-piracy laws by conducting raids across the country with the help of another ex-cop from Mumbai, A.A. Khan. Yashraj Films has also established anti-piracy offices in the United Kingdom and the United States to curb piracy in those markets, as overseas returns of its films, watched by the desi diaspora is one of its largest revenue earning sources. The website of Yashraj Films lists news reports from across US and Europe of instances of crackdown on pirates. 

In the context of intellectual property in the creative industries, these anti-piracy agents have successfully created the halo of illegality around the subject of piracy. The discourse on informal networks and circuits of distribution of cultural goods remains hijacked with efforts to contain piracy as the only rhetoric which safeguards the business interests of big media companies and multinational corporations.

The Indian Journal of Law and Technology (IJLT) is an annual law journal published by the Law and Technology Committee of the National Law School of India University, Bangalore. IJLT aims to provide a platform for promoting discussion on issues relating to the interface between law and technology, particularly from the perspective of the developing world.

The Centre for Internet and Society (CIS) is a leading research organisation that engages with issues of digital pluralism, public accountability and pedagogic practices, in relation to the field of Internet and Society, with special emphasis towards South-South dialogue and exchange.  IJLT and CIS are proud to announce the 1st IJLT-CIS Annual Law Essay Competition 2009, which is a competition open to undergraduate law students across India. The competition seeks to encourage creative thinking and promote research and writing about crucial legal issues in the field of Information Technology and the Internet.

Themes

1. Criminality and Second Life: Dr. Jekyll and Mr. Hyde
2. Trademark and the Internet: Cybersquatting and the Google Adwords-Consim Controversy -- Reasonable Limits to Trademark Protection
3. 3G Services and Spectrum Allocation: Fair Competition, Welfare and Freedom of Speech and Commerce on the Airwaves
4. Easier to Be Criminals: Judicial and Legislative Responses to Cyber Crime in India.

Judging

The winning law essays shall be determined through a blind review by a panel of eminent academicians in the field of law and technology.

Prizes

Ist Prize: Rs. 7500 and an internship at CIS

2nd Prize: Rs. 5000

3rd Prize: Rs. 4000

Please note that the terms of the above internship shall be decided by CIS on its own initiative, and as such shall not be negotiable. The winning law essay shall be considered for publication in the next issue of IJLT in accordance with the Editorial Policy of IJLT.

Eligibility

The competition is open to all undergraduate law students in any college/law school in India.

Submission Guidelines

• The entries must be between 5000-7500 words inclusive of all footnotes. The entries that fall short of or exceed the above word limit shall be penalised.
• Substantive footnoting is not permitted and shall be penalised. The use of endnotes or other citation methods is not permitted.
• The entries should be accompanied by a 150-word abstract. The abstract is not counted towards the word limit.
• All entries should be in Times New Roman, size 12, 1.5 line spacing. The footnotes used should be in Times New Roman, size 10, single line spacing.
• The footnotes used should follow a uniform and complete system of citation. However, the use of the Harvard Blue Book (18th edition) system of citation is encouraged.
• The entries must be submitted in the Microsoft Word format and with all identifying information removed from the text of the entries and the file properties. The covering e-mail should contain the name, e-mail address, postal address, institution, course and year of study of the author.
• The entries must be submitted via e-mail to essay@ijlt.in.
• The deadline for entries is 11:59 P.M., 23rd January, 2010.

For any clarifications, please send an e-mail to editorialboard@ijlt.in.

Information and knowledge are crucial factors in human development. We are reminded of this constantly, from the “knowledge economy” we live in, to the emotional and financial power that information and communications technologies (ICTs) have over our lives. In the words of philosopher Francis Bacon, “Scientia potentia est” – knowledge itself is power. Present-day movements for access to knowledge and the right to information have their origins in this simple and arguably ancient idea. Despite a rich history and wide intellectual acceptance, the right to know is not universally granted, and the right to know on the internet is a particularly bitter struggle in many parts of the world.[1]

Information, knowledge and access are terms with a multiplicity of meaning. Even as they constitute an ambitious goal that disparate global actors work towards, it is worth considering how these terms are construed in relation to each other.[2]

“Information” in this context usually refers to government and institutionally held records. Legislation that mandates greater transparency is critical. The earliest example of this kind of legislation was implemented in Sweden as far back as the late 18th century, while countries such as South Africa and India have had theirs enacted as recently as 2000 and 2005 respectively. Freedom of information and the resulting power to make informed decisions are bedrocks of liberal democracy, essential tools for active citizen participation – and the foundation of dominant ideas of the better life, such as that of an open society.

“Knowledge” in its most instrumental sense usually refers to the elements of learning; to scholarly and artistic work and its tools. The access to knowledge movement [3] for instance, works on copyright law reform and the promulgation of open access. Access to knowledge in its present incarnation is a relatively new frame of reference compared to the right to information, which has been demanded for a longer period of time. But it is worth bearing in mind that the underlying theme has always existed and even been expressed, most notably in the hope and anxiety surrounding every disruptive technological shift, from the printing press to the internet.

The most frequently misunderstood term in this troika is, perhaps, “access”. The common interpretation of the term is its strict dictionary meaning, which is to use, to consume, to be allowed entry into or contact with. In relation to information and knowledge, however, and especially since the advent of the internet, access is just as much about production as it is about consumption. Knowledge is not something that Northern countries produce and Southern countries consume; it is a vast and porous domain that consists of formal and as yet unrecognised realms, all of which are growing and evolving. To read is a necessary precondition to being able to write; access, by analogy, implies entry not just into the world of knowledge consumption but also knowledge creation.

One manifestation of this fusion is Wikipedia, the encyclopaedia that is collaboratively produced online. Granted, many more people read Wikipedia than edit it. Nevertheless, for a growing global volunteer base, it is simultaneously a place to read and consume as well as edit and produce. In a similar vein, it is access to information that propels people around the world to intervene in public processes and change laws; without the information, there could be no change.

With regards to government information, it is important that not only are there mechanisms put in place that facilitate access to it, but also that these mechanisms work. The history of events leading up to the enactment of the Right to Information Act in India provides valuable lessons as to what the scope of government information should be, in how punitive measures can be implemented to guarantee that the process works, and, above all, as to how marginalised citizens can gain the space and the means to use the law to their advantage [4] To a large extent, the rich genealogy of the right to information has naturalised it as an obvious, just and urgent issue. Furthermore, it is an umbrella concern, covering as much as specific local contexts demand.

In contrast, the movement for access to knowledge works primarily on one crucial barrier, namely, intellectual property. For some, this focus is problematic. If, for instance, knowledge is imparted by education, then isn’t access just as much hampered by the lack of skilled teachers as restrictive intellectual property laws? This is certainly true, and yet, there are at least three good reasons why this narrow focus makes strategic sense.
One: education is a long-standing priority of societies and governments the world over, and there is an inestimably large group of individuals and institutions who work in the area. However, relatively few people are aware of the impact of intellectual property on access to educational material, and even fewer research it.
Two: the advent of the internet has created hitherto unprecedented opportunities in the knowledge domain, opportunities that could turn into unrealised potential if the application of intellectual property online is decided by copyright industries alone.
Three: knowledge is more than just formal education, and the internet provides limitless ways in which it can be redefined and multiplied. The overzealous application of intellectual property significantly limits the manner in which knowledge operates online.

A chain of events that unfolded in France over the last two years dramatically illustrates the level of threat faced by those seeking information and knowledge online. In 2008, at the insistence of the domestic recording industry, the French government began considering the enactment of a law designed to thwart online piracy. As industry forces pressed on and Nicholas Sarkozy added his support, the effort culminated in a bill that would be popularly known as HADOPI [5] after the enforcement agency it intended to create. HADOPI employed the three strikes principle. If an internet user was found to have committed an act of piracy, the copyright holder in question was entitled to warn the user through HADOPI. No details as to the exact nature of the copyright violation were required to be provided other than that a violation had occurred. After three such warnings, internet service providers (ISPs) in France would be mandated under HADOPI to bar the user from being allowed access to the internet for a period of up to one year.

The prospect of HADOPI had people up in arms. A broad coalition of internet users, consumers and their allies quickly assembled in France and elsewhere in the world. To users in France, it represented an immediate threat; to users elsewhere in the world, it represented the extent to which their online freedoms could be restricted in the future. Apart from the draconian nature of the punishment meted out by this bill, users were outraged that every kind of misdemeanour – whether deliberate, inadvertent, supposed or even mistaken – would be treated the same, with the benefit of doubt given to the copyright holder. [6]

Throughout 2009, the bill faced several setbacks, including a complete rejection by the French National Assembly. But its backers pushed on, eventually winning approval after modifications; until 10 June 2009, when the Constitutional Council of France struck down HADOPI on the grounds that it was inconsistent with the country’s Constitution – for going against freedom of expression and the presumption of innocence.

To involve infrastructure providers (ISPs) in enforcing private copyright disputes and suspend user privileges in the wake of alleged copyright violations, as HADOPI wished to do, was admittedly an extreme step. But there are other, less visibly harmful ways by which access to online information and knowledge is threatened and thwarted, and the problem is that some of these ways appear innocuous – though in fact any investigation of them would provide cause for serious alarm. Of the many concerns that exist, at least a few deserve our immediate attention:

• Digital Rights Management (DRM) and Technological Protection Measures (TPMs);
• copyright law provisions that affect online education, whether by distance or in a physical classroom setting, or in a library;
• the lack of provisions that would meaningfully allow disabled learners and users (particularly the visually disabled) to access information and knowledge online; and
• the extent to which users can usefully integrate online copyrighted material into their lives in a manner that would be considered fair.
  

A primary anxiety around copyrighted material in the online environment has been, on the part of copyright industries, how to regulate the flow of exchange. Previous to the advent of mass use of the internet, a song or a book was limited in its capacity for exchange by the physical, tangible form it came in. With the proliferation of digital material and peer-to-peer systems, however, the possibility for exchange is virtually boundless, and this makes content industries nervous – for it signals the end of an already outdated business model and the beginning of another. In return, industry retaliation has consisted of a strategy of lockdown. The tools of this strategy are DRM and TPMs – software that regulates what one can do with a digital file, or rather cannot do – and the vehicles by which these are legislated and proliferated around the world are a set of World Intellectual Property Organization (WIPO) agreements collectively known as the WIPO Internet Treaties.[7]

DRM is oblivious of the specific circumstances of the user, and is therefore unaware of both the user’s individual needs as well as her rights – for example, the nuances of copyright law in the country of the user’s residence. It doesn’t matter therefore that a user may be blind, or work for a public library, and that national copyright law in the country might specifically extend provisions to visually disabled people and libraries (for instance, by enabling permission-free format changes and reproductions for research). DRM will still operate on a one-size-fits-all model that supersedes national law. In some countries, fair dealing – or fair use – might allow for ways of personal consumption of copyrighted material that the DRM withdraws, resulting in a situation where the whims of a multinational industry render national law meaningless.

DRM is software that can be hacked – up to an extent. In this way, it is still possible for users to legitimately exercise their rights with and upon DRM-protected material. Yet, following the model of the Digital Millennium Copyright Act (DMCA) – the United States’ (US) interpretation of the WIPO Internet Treaties – many countries have legislated that such circumvention constitutes a copyright violation. In some cases this renders sections of their own copyright law redundant, and in effect, casts an unnecessarily heavy shroud over certain copyrighted material merely because it happens to be online. More worryingly, the WIPO Internet Treaties themselves do not ask of countries that anti-circumvention provisions apply even when a user is exercising a legitimate right such as fair use, and yet countries around the world have allowed their laws to imply so [8] because of bilateral persuasion, often from the US or the European Union, without a clear understanding of how this can stunt the potential of the internet within their borders.

It must be noted that copyright law in general – in most countries around the world [9] – generally does not do enough for access to knowledge. To the extent that the majority of the world learns not online but from the printed and spoken word, copyright law in its general application matters tremendously. When considering the potentially limiting aspects of copyright regulation online, one must keep in mind that many countries around the world do not have the kind of provisions that could be limited by new regulation of online material. In fact, most countries do not expressly facilitate distance learning, nor make all the provisions they can for access for the visually disabled, or freedom of information, or even education in general. [10] In part, this is because ever since the globalisation of intellectual property rights, including as recently as the founding of the World Trade Organization (WTO) in 1996 and the instituting of its Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), [11] there has been a distinct shift away from the minimum copyright protection demanded by this trade rule to a maximally protectionist approach.

In the majority of national circumstances today, copyright law is what is referred to as TRIPS-plus, which is to say, excessively protective of copyright-holders’ interests. The excess is overwhelmingly in favour of copyright industries and at the expense of users of copyrighted material. In such a situation, when copyright as it applies offline is already imbalanced, it is even harder to demand a balanced interpretation of copyright in the online space.

Finally, it hardly needs repeating that without a strong sovereign commitment to freedom of speech and information – in effect, a guarantee against censorship – any gains made in access rights stand to be nullified. And this commitment, worryingly, is by no means universally evident.

1. For one understanding of the right to know, see Stiglitz, J. (2009) On Liberty, the Right to Know, and Public Discourse: The Role of Transparency in Public Life, Oxford Amnesty Lecture, Oxford, UK, 27 January. siteresources. worldbank.org/NEWS/Resources/oxford-amnesty.pdf
   For an understanding of how countries restrict access to the full potential of the internet, see Reporters Without Borders’ list of “Internet Enemies”: www.rsf.org/List-of-the-13-Internet-enemies.html
2. Naturally, all three words offer a wide scope of understanding. The descriptions that follow are only an attempt at clarifying a functional definition, not at fixing definitive meaning.
3. The movement for access to knowledge (sometimes abbreviated as A2K) refers to a loose grouping of individuals and institutions who work locally as well as on a potential international treaty on access to knowledge; an early draft is available at: www.cptech.org/a2k/a2k_treaty_may9.pdf
4. For an understanding of the concerns of a key Indian social movement, the Mazdoor Kisan Shakti Sangathan (MKSS), in the years leading up to the enactment of India’s Right to Information Act, see Sampat, P. and Dey, N. (2005) Bare Acts and Collective Explorations, in Narula, M. et al. (eds.) Sarai Reader 05: Bare Acts, Sarai, New Delhi. www.sarai.net/publications/readers/05-bare-acts/02_preeti.pdf
5. HADOPI: Haute Autorité pour la Diffusion des OEuvres et la Protection des Droits sur Internet (High Authority for the Diffusion of Works and the Protection of Rights on the Internet).
6. For one account of the story of HADOPI, see O’Brien, D. (2008) The Struggles of France’s Three Strikes Law, Electronic Frontier Foundation. www.eff.org/deeplinks/2008/05/struggles-frances-three-strikes-law
7. The WIPO Internet Treaties consist of the WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT).
8. For instance, in a recent eight-country study in Africa, it was found that Morocco, Kenya and Egypt all have anti-circumvention provisions enacted into law. See the ACA2K Briefing Paper for the WIPO Development Agenda meetings, April 2009: www.aca2k.org/attachments/180_ACA2K%20Briefing%20Paper1_WIPODevtAgenda-042009.pdf
9. Among several country studies, regional and international reports, one recent survey that confirms this finding is the Consumers International IP Watch List report for 2009, in which it is reported that in relation to access to knowledge, “no countries adequately took account of consumers’ interests.”
   See:a2knetwork.org/sites/default/files/ip-watchlist09.pdf
10. Ibid.
11. TRIPs is currently the overarching international trade rule that governs the global sovereign application of intellectual property; for the full text of the TRIPs agreement, see: www.wto.org/english/tratop_e/trips_e/trips_e.htm
    

Getting to the National Market

Wading through Majestic Bus Stand, Flea Markets, Private Bus Stops and vehicles going around in circles, you could almost miss this board outside one of the shopping plazas. NATIONAL MARKET, the famed "pirate market" at the heart of the city. Most of the business here is illegal and the local police raid the thirty odd shops selling goods, which within the purview of any multilateral agreement under WIPO or TRIPS regime would be an infringement of copyright, at least once a month. The shops run shutter to shutter, each one five by four feet. Crowded with sellers and customers, all pirate markets typically smell the same. Pirated DVDs, DVD players, Chinese mobile phones and PDAs, even VHS players of the yore, smuggled MP3 music systems, fake Ray-Bans and Police sunglasses, gaming consoles. You name it, and National Market has it.

Meet the Pirate

Tall and sporting a stubble, Sooraj (name changed) is a Malayali who has been in the trade for over 8 years. "Earlier, I used to have the best English Movie collection ever. But now, its all going away. Most people have shifted from DVD's to Digital Storage and Bit Torrents", says Sooraj. A family comes across the counter. A middle aged man accompanied by two women in a burqua, one of them carrying a young baby boy in their hand. "Tom and Jerry!", says the man and Sooraj's helper brings out a carton full of animated Hollywood films. Finding Nemo, The Lion King, Madagascar, its all there. "No Tom and Jerry. This doesn't have Tom and Jerry", growls the stout customer. Sooraj jumps into the action, hunts out a DVD from a stack and puts it on the table. "Tom and Jerry Tales - 13 episodes", reads the the outside with a classic Tom chasing Jerry picture on the cover. Satisfied, the family puts it aside and goes on to explore other popular cartoon series. In the end, the man calls for Maharathi, a recent Bollywood flick. He looks at the cover intriguingly and I decide to butt in, "Amazing movie. Just saw it last week. Great plot." The deal is seized and after a bout of bargaining over the price. As the family dissolves into the market, Sooraj turns back and says to me, "A lot of customers bargain. I get a headache. And my shop is the first one in the market, inside people operate on margins of 5-10 rupees. That just ruins everything for us. They don't think of the amount of the risk involved."

The Business of Piracy

Sooraj explains to me how Chennai is the biggest market of the South. "Chennai is a sea. You will get everything there. Once you take a dive in that ocean, it's all there." When I ask him of the chain of distribution, he says, "No one will say that I print the covers of fake DVDs or I copy prints. For me, I just call my distributor and everything comes from Chennai. I don't ask beyond that. The stock comes in the price range of 25-35-40 Rupees. Now, there is only one quality of stock. The market is dying. No one has good stock. Earlier, we used to sell DVDs for Rs.70-80. Now, there is no demand. Even the wholesale business is at a low.'' I ask him, "So what are you going to do, now that soon DVDs will be gone?" Sooraj is not flustered. "We will shut this and start a new business," he says. I quietly step back, as another customer comes asking for audio CDs. He doesn't deal in those.

Enforcement Threat

When the customer is gone, I ask him, "How often does the police raid this market?" He smiles and replies, "Not often anymore. The business is almost dead. But yes, they come sometimes. Then you are taken away and a case ensues." I decide to ask him candidly, "How many times have you been booked?" He smiles again. "5-7 times. I have a few cases pending, dates that I have to go and visit the court. They arrest you for a day but that's all they can do. After all this is not a big crime." He continues dealing with customers who have various demands for music and films. Some he sells to, he guides others to the inside shops. "I sell about a 1000 DVDs everyday. Earlier, the figure used to be much higher. Mostly English. Hindi, Tamil and Telugu too. No Kannada," he volunteers. I probe further, "Why no Kannada?" He says that that he supports protection for their own industry. "And the market price for Kannada films is appropriate. Some are Rupees 60, 90, 110. That's reasonable. We do not need to pirate it."

The Confederation of Indian Industry (CII) organized its third annual conference on counterfeiting and piracy, with support from the United States Embassy and the Quality Brands Protection Committee of China (a body comprising more than 80 multinational companies).  Last week we criticised the conference in an open letter.  This week, we examine a few of the recurring themes that came up at the conference.

Something being substandard is not the same as something being counterfeit.

This was a mistake made by many whenever they invoked 'counterfeit' in the sense of something that is violative of one's patent and trademark rights.  The Indian Drugs and Cosmetics Act itself distinguishes between 'misbranded', 'adulterated', and 'spurious' drugs, thus recognizing that something that is made without proper authorization from rights owners isn't necessarily of a bad quality.  Indeed, this was substantiated by an audience member, a lawyer from Dr. Reddy's Lab.  She spoke of a mandi in Agra where they seized medicines being sold under the Dr. Reddy's name, but produced by local manufacturers.  Upon lab testing, it turned out, much to their surprise, that the medicines were of the highest quality and were not substandard.  Similarly, many large companies including trusted FMCG companies like Hindustan Unilever and ITC are upbraided by authorities for violations of the Drugs and Cosmetics Act (for the cosmetics they produce) as well as the Prevention of Food Adulteration Act.  Thus, even legitimate businesses can produce substandard products.  Thus, a product can be unauthorized but not substandard, just as a product can be substandard but not counterfeit.

This distinction becomes very important when we talk about patents, and especially drug patents.  A generic drug is by definition identical or within an acceptable bio-equivalent range to the brand name counterpart with respect to pharmacokinetic and pharmacodynamic properties.  Thus, this entire category of high-quality drugs is often sought to be made illegal or counterfeit by large pharma companies.  Some countries like Kenya have capitulated.  But so far the World Health Assembly has been forced by developing countries to keep the issue of substandard medicines separate from patent-bypassing medicines.

The industry, for all their talk about "out of the box" thinking on the issue, still only consider metrics such the number of piracy raids conducted as measures of success.  A question was put forth by Manisha Shridhar of the Intellectual Property & Trade Unit of the World Health Organization upon learning of the quality of the drugs seized at the Agra mandi: Why not cut a licensing deal with those manufacturers, who obviously have excellent production facilities?  That kind of thinking, which helped HMV in India in the 1980s, and copying innovative features from video pirates and pricing their products competitively has helped an Indian company, Moserbaer, do extremely well.

Counterfeiters and pirates are not always seeking to fool consumers.

Only lawyers hired by the industry would think that a consumer aspiring towards a Rolex watch would actually think that the one he purchased off the streets for one-hundredth the original's price was in fact original.  Street-side DVD hawkers are not thought by the general public to be selling original wares.  Still, despite knowing the difference between the original and the fake, consumers many times opt for the latter.

Having said that, counterfeiting, by using someone else's trademark and trying to pass off fake goods as real ones, is quite obviously wrong.  It harms customers, and it harms the manufacturers.  Thus, a distinction deserves to be made here between the counterfeiters who try to deceive consumers (for instance by copying authenticity marks, like holograms, etc.) and those who are just providing them with highly cheaper alternatives (pirated DVDs, etc.).  In this light, it is also important here to distinguish between counterfeiting, traditionally taken to be trademark violation, and piracy, traditionally taken to be a violation of international law, but now generally meaning a large-scale violation of copyright law.  While the former can lead to consumer confusion, the latter scarcely ever does.  This is ignored by industry people who evoke the image of the consumer quite often, but only when it helps them, and not in any meaningful manner.  They negate consumer choice when it comes to consciously purchasing pirated goods, and consumer freedoms when it comes to usage of copyrighted materials.

While commercial film piracy funds terrorists, so does pretty much every business activity.

A favourite of the MPAA (and by association, the MPA) is the RAND report on Film Piracy and its Connection to Organized Crime and Terrorism.  This report, which was funded by the MPAA, predictably concludes that film piracy funds organized crime and terrorism.  Even if we are to believe its findings wholesale, it leaves us wondering whether all business activities from which terrorists derive funds should be banned.

In India, there is a substantiated link between organized crime and film and music production, and terrorists have been said to make money off the stock market.  If the MPA's arguments are taken to their logical conclusions, then film production and equity trading should also be prosecuted.  Furthermore, while the mafia and terrorists are the ostensible targets, the laws that are brought about to tackle it affect poor roadside vendors and non-commercial online file sharers.  To tackle the funding of terrorists, roadside piracy shouldn't become the target just as film production per se shouldn't.  The invocation of the RAND report is thus only meant for rhetorical effect, as it is hard to find logic in there.

"To copy without authorization is to steal", the death penalty, and drug peddling.

At the conference, Dominic Keating of the US Embassy pointed out that "to copy without authorization is to steal" and David Brener of US Customs and Border Protection kept emphasising, on at least two occasions, that "drug peddling merits an automatic death sentence in many countries".  There are numerous arguments one can make to show the lack of thought in the former.  One could point out that 'stealing' and 'theft' are things that happen to tangible property, and that not only is copyright not tangible, but it is barely property.  Copying without authorization creates one more of what existed, without depriving the authorizer (usually a corporation) of its original.  This goes against our notion of 'stealing'.  If the argument is to be shifted to the terrain of control over one's property/copyright, Mark Lemley in an illuminative article shows how the economic theories behind externalities in property and copyright are vastly different, and that complete control over either has never been, nor should it ever be, an aim of the law.  Simply put, someone free riding on your property leaves you worse off than earlier, while someone free riding on your copyright usually doesn't.

One could also point out that 'stealing' is endemic in activities involving human creativity.  T.S. Eliot notes that "Immature poets imitate; mature poets steal; bad poets deface what they take, and good poets make it into something better, or at least something different".  He does not even consider the possibility that artistic borrowing, whether by imitation or by 'stealing' does not happen.  Even Y.S. Rajan, Principal Adviser to CII recognized this when during the conference he noted that "imitation and innovation have an interesting and intertwining philosophical history".  If we are to take Mr. Keating's admonishment seriously, we would indeed have a very illustrious list of thieves on our hands, including the Walt Disney Corporation, William Shakespeare, Vladamir Nabokov, Public Enemy, and pretty much every creative person who has ever lived.  Books can be written about this (and indeed, numerous books have been), so we shall not dwell on this issue.

Mr. Brener's repeatedly spoke of how drug peddling attracts death penalty in many countries (though in neither the US nor in India has anyone ever received capital punishment for drug peddling), but he also clarified that he is not advocating for the death penalty for copyright violations.  That made one wonder why he was bringing up the death penalty at all.  He also made the dubious, non-substantiated claim (noting it as "true fact") that pirating movies is more profitable than selling heroin.  This claim appears in an article about a report produced by the Australian Federation Against Counterfeit Theft (AFACT), but the original report is nowhere to be found.  The article about the AFACT report also claims that the pirates are using their illicit profits promote drug smuggling.  The seeming contradiction of film pirates investing in something that is riskier and less profitable doesn't seem to have caught the eye of the writers.  One version of the 'drugs are less profitable than pirated DVDs' claim (with marijuana taking heroin's place) was debunked on the Commons Law mailing list.  Pirated DVDs are sold for a fraction of the cost of the original.  It would be obvious to anyone that DVDs that are typically sold for Rs.30-50, where the cost of manufacture alone may be estimable to be around Rs. 10, cannot be more profitable than heroin peddling.  That apart, most online file sharing (deemed to be "piracy") is non-commercial.  Thus the question of profit does not really arise.  Still, for the industry, absence of a profit is equal to a loss.

Thus, the rhetoric of crime, and that too heinous crime, is continually used, despite its being completely inapposite. Why does used to try to make IP enforcement a matter of state concern, rather than a matter of private, and civil, interest.  This way, illegitimate statistics and factoids are used to make individual file-sharers who earn no money get lengthy prison sentences.  This and other ways in which IP enforcement has expanded are carefully documented in this paper by Susan Sell.

Repeating false 'statistics' does not make them true.

Again, we were subjected to a number of dubious claims during the conference: If only counterfeiting and piracy were eliminated, India's fiscal deficit would disappear; the Indian entertainment industry loses 16000 crore (USD 4 billion) yearly to piracy; 820,000 direct jobs are lost due to film piracy; software piracy costs the industry USD 2.7 billion annually, etc.  These reports' methodologies have been thorougly discredited.  Even The Economist, a very conservative and pro-industry newspaper, believes that the BSA-IDC annual reports on software piracy are utterly distorted.  Similarly, in the U.S., the figure of 750,000 jobs (around 8% of the U.S. unemployed in 2008) being lost due to piracy were touted by everyone from the Department of Commerce, the Chamber of Commerce, U.S. Border and Customs Protection, and the MPAA, RIAA, and BSA.  The amount of money lost each year in the U.S. due to IP infringement has been estimated to be between USD 200-250 billion (that's more than the combined 2005 gross domestic revenues of the movie, music, software, and video game industries).  In a lengthy piece in Ars Technica, Julian Sanchez traces back the history of both these figures, and shows how they are just large numbers used for lobbying, and are not based on actual studies.  The industry-commissioned Ernst & Young  report ("The Effects of Counterfeiting and Piracy on India's Entertainment Industry") was never made available to the public at large, thereby making it impossible to judge the methodological soundness of the survey and the veracity of the figures.

IP expansion and more stringent enforcement is counter-productive.

Chander Mohan Lall, copyright lawyer to various film studios (including Warner Bros.) in India, used a number of short film clips in presentation during the conference.  Upon being questioned about it, he admitted that he did not have permissions of the copyright holders, but claimed that his use fell under "the education exception" in Indian copyright law.  While I wish he were correct (because what he was doing was indeed educational use), as per the law he is wrong.  Section 52(1)(i) of the Copyright Act only exempts educational usage of cinematograph film recordings when "audience is limited to such staff and students [of an educational institution], the parents and guardians of the students and persons directly connected with the activities of the institution".  While there are other arguments he could seek to use to make his usage of the film clilps non-infringing, being excepted by the educational fair dealings clauses isn't one of them.  Thus, more stringent enforcement of IP rights actually engenders such unauthorized, but perfectly legitimate copying and communication to the public such as that done by Mr. Lall.

Another way in which IP enforcement is being sought to be increased is by way of the so-called Goonda Acts.  These are generally statutes aimed at criminals and lumpen elements in society.  The Maharastra version, the Maharashtra Prevention of Dangerous Activities of Slumlords, Bootleggers, Drug-Offenders and Dangerous Persons Act, 1981, just became the Maharashtra Prevention of Dangerous Activities of Slumlords, Bootleggers, Drug-Offenders, Dangerous Persons and Video Pirates Act.  The term "video pirate" is very widely defined, to include any copyright infringement-chargesheeter who is "engaged or is making preparations for engaging in any of his activities as a video pirates, which affect adversely or likely to affect adversely, the maintenance of public order". Public order is deemed to be disturbed by "producing and distributing pirated copies of music or film products, thereby resulting in a loss of confidence in administration".  Thus video pirates can possibly be interpreted to include individual sitting at home and using P2P networks to share films.  The only requirement is that they should have had a chargesheet lodged against them previously -- they needn't even have been convicted; being chargesheeted suffices.  Thus, non-commercial activities of file-sharing are equated to bootleggers and drug smugglers, and preventive detention (an anti-civil rights relic of India's colonial past) is applicable to them.

IP expansion is happening without the ostensible justifications for IP being kept in mind. That Tirupathi ladoos are going to get GI (geographical indicator) protection was announced at the conference with great pride.  Geographical indicators are used to protect consumer interests, to ensure that no one outside a particular region (Champagne) can lay claim to be producing that product (Champagne) if the production of that product is intrinsically linked to special features found in that region (climate, etc.).  However, no devout person would want to purchase anything advertised as "Tirupathi ladoo" if it were produced outside the Venkateswara temple at Tirupathi, thus the question of consumer confusion does not arise.  What if someone malignantly advertises something as Tirupathi ladoo and claims it was made in Tirupathi (and not just that it tastes like the ladoo made there)?  Such a person can be taken to task for deceptive advertising, and there is no need for something to have IP protection to do so.  This represents a senseless expansionism of IP.  It is now IP for IP's sake.

One of the speakers, Mr. V.N. Deshmukh, who though pro-stringent IP enforcement, astutely noted that, "When local demand is not met, they [consumers] turn to counterfeiters and pirates."  Local demand can be unsatisfied because of lack of supply, or because the supply is overpriced, or because the supply is not easy to access, or because what is supplied is inferior to what is demanded.  At the end of the day, as William Patry, Google's lead counsel, has noted, what companies sell to the public are products and services, and not IP.  It would thus be wise for businesses to be innovative and compete rather than trying to extend their monopolies and engaging in rent-seeking behaviour that is economical harmful to consumers.  They would also do well to remember that IP is not only a product but an input as well, so they are ultimately consumers themselves.  All the harsher laws and enforcement mechanisms that they push for right now will have unintended consequences, and come to affect them adversely.

An Open Letter to the President of Confederation of Indian Industry (CII) on the Third International Conference on Counterfeiting & Piracy

To
Mr. Venu Srinivasan
The President 
Confederation of Indian Industry (CII)
The Mantosh Sondhi Centre, 23, 
Institutional Area, Lodi Road
New Delhi - 110 003 

Dear Mr. Srinivasan,

We understand that Confederation of Indian Industry (CII) is hosting the Third International Conference on Counterfeiting and Piracy from 19-20th August 2009 in partnership with the Embassy of the United States and the Quality Brand Protection Committee (QBPC), China. As stated in the invitation letter the primary objectives of the conference are: 1) to initiate coordinated action for cross border enforcement; 2) to highlight the importance of protection of intellectual property rights (IPRs); 3) to combat the growing threat of piracy and counterfeiting; 4) to facilitate a global meeting of customs officials across the globe; 5) to recommend the creation and setting up of a governmental “National Brand Protection” group; 6) to serve as a forum to discuss legal guidelines related to the prosecution of IPR infringement and to eliminate ‘loopholes’ within the existing laws; and 7) to strengthen cooperation between enforcement agencies and chalk out strategies for enforcement agencies a industry action both at national & international level. We also understand that this international conference is part of CII Intellectual Property Division’s special initiative on enforcement of IPRs. As part of this special initiative CII aims at “engaging government to create conducive legislative measures, policy levels reform and impressing [upon them] to adopt stringent enforcement initiatives and exemplary punitive and monetary measures to further safeguard and secure the interest of industry”. CII also wants to “create a global partnership to synergise efforts of international community and to support and participate in India's efforts in combating counterfeiting both at domestic and international levels”.  We, the undersigned, representing various civil society organizations in India, write this letter to express our strong reservation on the conference as well as on CII’s special initiative on IP enforcement. Without raising any question on CII’s right to organize events we would like to convey the following concerns with regard to the conference and CII’s initiative on IP enforcement.

Many of the above mentioned objectives of the conference and the special initiative are directed towards the enhancement of intellectual property (IP) standards like coordinated action on border measures, common guidelines for prosecution of IP infringement, exemplary punitive and monetary measures, etc. In other words, enhancement of IP standards means using more public money to protect private rights; very often protecting the monopoly over intangible property rights of multi-national corporations (MNCs).

As you may be aware, MNCs and their developed country hosts are currently engaged in the implementation of a multi-pronged strategy to enhance IP enforcement standards.[1] This is similar to the MNC’s initiatives in the mid 80s to enhance international IP protection, which resulted in the Agreement on Trade-Related aspects of Intellectual Property Rights (TRIPS). Unlike the 80s, now MNCs and developed countries use multiple forums to pursue the objective of enhancement of IP enforcement standards. Some developed countries have unilaterally enhanced their IP enforcement strategy to force other countries, especially developing countries, to accept the same through various multilateral organizations, namely the World Customs Organization (WCO), World Health Organization (WHO), Universal Postal Union (UPU), Interpol, WIPO and WTO. Developed countries are also using Free Trade Agreements (FTAs), Bilateral Agreements on IP Enforcements as well as financing lobbyist studies, conferences and policy recommendations to impose higher IP enforcement standards. These efforts for the enhancement of IP enforcement standards are a matter of grave concern for the people of developing countries and their governments. By partnering with the US Embassy and Quality Brand Protection Committee of China (QBPC)[2] in the organization of this conference, CII is allowing itself to play in the hands of MNCs and some developed countries, whose interests do not match with that of India industries and that of the Indian people.

As you are aware, the Government of India is taking a very strong position in resisting enhancement of IP enforcement standards in all the multilateral forums. India along with like-minded developing countries successfully pushed back TRIPS-plus[3] IP enforcement agenda at WCO and WHO. India is also trying its level best to convince other developing countries the need to stick to TRIPS-compliant standards rather than adopting TRIPS-plus enforcement standards. In the wake of the controversial generic drug seizures by EU customs authorities, India has also raised the issue of TRIPS-plus IP enforcement standards contained in the EU IP Enforcement Directive at least two times at the TRIPS Council.[4]  The Indian political leadership has unequivocally raised its concern over the enhancement of IP enforcement standards at other forums also.[5] In adopting this stance, the Government of India has cited public interest as well as the operating freedom of Indian industry as its justifications.[6]  By partnering at this vital stage with an MNC lobby group and a heeding to developed country governments, CII is not acting in furtherance of the legitimate public interests of Indian domestic industry and the Indian people.

It is a well-evidenced fact that TRIPS-plus enforcement standards adversely impact not only legitimate trade between nations (as shown by the EU seizures) but also the day-to-day life of millions of people especially in India and other developing countries.[7] Unfounded IP enforcement measures would adversely impact access to life saving medicines and educational materials. Thus the IP enforcement measures also have the potential to deny right to development to people in the global South. Hence an organization like CII should not view IP as only a business tool but should look at the larger scheme of things especially in the social and economic realities of India. In fact, by promoting enhancement of IP enforcement standards CII is advocating a policy, which would violate the right to health, the right to knowledge, as also the right to development.

We would also like to point out that Indian pharmaceutical industry is one of the victims of TRIPS-plus IP enforcement standards. In 2008 alone, 17 consignments[8] were seized in transit at Europe using the EU Directive on IP Enforcement, which allows seizure of goods in transit.[9] These consignments were being exported from developing countries (such as India and Brazil) to other developing countries, and the contents of the consignments are perfectly legal in both the exporting as well as the importing nations.  These highly questionable seizures resulted in the crisis of health programmes as it resulted in delays in   and prohibitive costs of access to life-saving medicines in developing countries of Africa and Latin America. CII can barely claim to be representative of the interests of Indian industry if it ignores such episodes and partners with self-promoting MNCs and developed countries’ governments to advocate for the enhancement of IP enforcement standards.

In the light of above-mentioned issues, we request you to consider the following:

• Rejecting the TRIPS-plus enforcement agenda in toto.  We demand CII, Federation of Indian Chambers of Commerce and Industry (FICCI), Associated Chambers of Commerce and Industry(ASSOCHAM) and other Indian business associations to  reject any and all attempts of  bringing in a TRIPS-plus enforcement agenda in India, in the interests of Indian industry and the Indian people.
• Completely disengaging from any collaborative efforts with foreign institutions to further TRIPS-plus standards of IP protection in India and also abstaining from any engagements on the anti-counterfeiting efforts with foreign agencies.  CII should attempt to engage with domestic institutions and build national consensus before engaging with foreign institutions with the claim of representatives of Indian industry.
• Taking necessary proactive steps to safeguard the interests of access to medicine and access to knowledge along with interest of the Indian domestic industry.
• Participating in a more creative discussion on IP and development rather than simply accepting the simplistic and largely discredited view that stronger IP regime leads to more innovation and is a necessary condition for socio-economic development.

CC:
Shri Anjan Das
Senior Director & Head
Technology, Innovation, IPR & Life Sciences
Confederation of Indian Industry (CII)
Plot No. 249-F, Sector-18; Udyog Vihar, Phase-IV,
Gurgaon-122015, Haryana

Shri. P. Chidambaram
Minister
Ministry of Home Affairs
Government of India
North Block, Central Secretariat
New Delhi 110001

Shri G. K. Pillai
Secretary Justice
Department of Justice
Ministry of Home Affairs
Government of India
North Block, Central Secretariat
New Delhi 110001

Shri Naresh Dayal,
Secretary, Dept. of Health and Family Welfare
Ministry of Health and Family Welfare
Government of India
149-A, Nirman Bhawan, New Delhi – 110 011 

Shri Ajay Shankar
Secretary
Department Of Industrial Policy & Promotion
Ministry of Commerce and Industry
Room 153, Udyog Bhavan,
New Delhi – 110 011

Signatories to this letter

• Centre for Trade and Development (Centad), New Delhi
• Centre for Internet and Society, Bangalore
• National Working Group on Patent Laws, New Delhi
• Lawyers Collective (HIV/AIDS Unit)
• All India Drug Action Network (AIDAN)
• International Treatment Preparedness Coalition (ITPC), India
• Consumers Association of India, Chennai
• IndoJuris Law Offices, Chennai
• All Indian People’s Science Network, New Delhi
• Delhi Science Forum
• Alternative Law Forum, Bangalore
• Knowledge Commons
• Moving Republic
• IT for Change
• Centre for Health and Social Justice(CHSJ), New Delhi
• Navdanya, New Delhi
• Support for Advocacy and Training to Health Initiatives (SATHI)
• Centre for Enquiry Into Health and Allied Themes (CEHAT)
• Initiative for Health Equity & Society
• International Peoples Health Council (South Asia)
• Drug Action Forum – Dharwad, Karnataka
• Dr. Mira Shiva, New Delhi
• Tina Kuriakose, PhD Scholar, Jawaharlal Nehru University, New Delhi
• Dr Gopal Dabade, Dharwad
• Dinesh Abrol, Scientist NISTADS, CSIR, New Delhi
• Madhavi Rahirkar, Lawyer/Consultant, Pune
• Gautam John, Bangalore
• Achal Prabhala, Bangalore

Endnotes

[1] See Susan K Sell, The Global IP Upward Ratchet, Anti-counterfeiting and Piracy Enforcement Efforts: The State of Play.
[2] QBPC barely qualifies as a representative of Chinese interest, as it comprises more than 180 multinational member companies.
[3] ‘TRIPS-plus’ refers to any protection of IPRs that surpasses the standards and requirements spelt out in WTO-TRIPS provisions.
[4] See Jonathan Lyn, India Brazil raise EU drug Seizures issue at WTO, available at http://www.livemint.com/2009/02/04232721/India-Brazil-raise-EU-drug-se.html
[5] Indian Minister of State for External Affairs Broaches Seizures of Generics at ECOSOC, available at http://www.keionline.org/blogs/2009/07/08/india-ecosoc-seizures/#more-2404
[6] Indian Commerce Secretary’s Speech to the African Community Ambassadors. available at http://www.centad.org/focus_77.asp.
[7] For two very recent examples, see Intellectual Property Enforcement: International Perspectives, Xuan Li & Carlos Correa (eds.) (2009); Anand Grover, Report of the Special Rapporteur on the Right of Everyone to the Enjoyment of the Highest Attainable Standard of Physical and Mental Health, A/HRC/11/12 (2009).
[8] Jyoti Datta, 16 out of 17 drug consignment seizures in the Dutch were from India available at http://www.thehindubusinessline.com/2009/06/08/stories/2009060851700300.htm
[9] The EC Regulation No 1383/2003 allows for seizure of goods in transit.