The Hindu Business Line : 'Moral medicine to a mortifying mischief'

IN Measure For Measure, the Bard writes, "The miserable have no other medicine but only hope." When duplicates come cloaked as medicine, the aggrieved have no other medicine but hope through legal remedy. A recent example is the case of The Himalaya Drug Company that the Delhi High Court decided on December 5.

The company had sought order for permanent injunction restraining Sumit, the defendant, from reproducing, communicating to the public, adapting, using or infringing in any other manner, Himalaya's copyright in herbal database and herbal write up/description.

First, some background information. Himalaya is engaged in "the manufacture and sale of Ayurvedic Medicinal preparations and was established in the trade in the year 1930," as the text of the judgment informs. "Realising the potential of the Internet as a medium of information," the company registered, in June 1998, its domain name www.thehimalayadrugco.com.

Were you to check the site, you'd learn from the `history' page that 75 years ago, on a visit to Burma, Himalaya's founder, M. Manal, saw restless elephants being fed with a root to pacify them.

"The plant from which this was taken is Rauwolfia serpentina. Fascinated by the plant's effect on elephants, he had it scientifically evaluated. After extensive research, Serpina, the world's first anti-hypertensive drug, was launched in 1934." There is no drug, however, except litigation to beat the hypertension that blatant piracy can cause.

Herbal database

At the High Court, the company informed that its Web site contains "various features and write-ups on Ayurveda, animal health products, Ayurvedic herbs and minerals, Himalaya herbals, Himalaya herbal healthcare and so on". According to the company, `the most important feature of the Web site' is the section titled `Himalayas Herbs'.

The company explained that this section consists of "a database of a wide variety of medicinal herbs, arranged in alphabetical order". The preparation of the database began sometime in June 1998 and took more than a year to complete, said the company. (On the site, the option reads `Herb Finder' and offers names in English, Latin and Sanskrit.) "Under the head of each herb there is presented information relating thereto. Such information is not only comprehensive but is also arranged in a manner that is visually appealing and easy to grasp," said Himalaya.

The company said that the site was advertised `extensively in leading newspapers and journals'. The Court was shown as evidence `a printout of the homepage' and also `other relevant pages' from the site. Also, as proof of the site's popularity, Himalaya produced `computer printouts of e-mail messages received' in relation to the site.

The database contains information about 200 herbs. One of the `exhibits' submitted to the Court was about `Abelmoschus Moschatus'. The Court noted that Himalaya had expended `considerable time, labour, skill and money' in preparing the database of herbs. "Even the selection of the 209 herbs that find mentioned in the Web site was a laborious task as the plaintiff (Himalaya) had to select from over 40,000 herbs," said the Court.

An interesting point is that Himalaya averred that it had the copyright in the herbal database because its employees who created the database `did so during the course of their employment'. Also, that they had given `no objection certificates' stating that the copyright in the database and all its accompanying elements vested with the company.

"The arrangement of features on the plaintiff's Web site and in, particular, the section relating to `Himalayas Herbs' including the layout, placement on details, getup and the `look and feel' cumulatively constitute a `trade dress'," said the Court. (The phrase `trade dress' means `a product's unique packaging that uniquely identifies that product,' explains www.legal-explanations.com. "Trade dress includes colour schemes, textures, sizes, designs, shapes, and placements of words, graphics, and decorations on a product or its packaging," elaborates www.lectlaw.com.)

Enter copycat

On March 27, 2000, Himalaya noticed that the defendant Sumit was operating a Web site called http://ayurveda.virtualave.net. To the company's dismay, the site reproduced Himalaya's entire herbal data verbatim! Thus, as further evidence before the Court, Himalaya submitted computer printouts of the homepage and other relevant pages of Sumit's site.

"A comparison of the defendant's Web site with that of the plaintiff's reveals that the defendant has not only copied the preliminary information of each herb but also the detailed monograph," said the Court. "The copying is to such an extent that even the grammatical or syntactical errors that appear on the plaintiff's Web site have been copied on to the defendant's Web site." A thorough job, in other words.

Sumit's site was registered two years after Himalaya's site, proving that Sumit had `misappropriated the effort, skill and expense' that had gone into the creation of Himalaya's site. "Thereby the defendant has copied the entire herbal database of the plaintiff and has thereby infringed the copyright of the plaintiff," said the Court.

Himalaya has been able to demonstrate that Sumit attempted to pass off his herbal database as that of Himalaya's and also violated the `trade dress' rights that exist in respect of Himalaya's herbal database, said the Court. Since Himalaya's herbal database is unique, "any similar herbal database that appears on a different Web site is bound to create confusion" by causing a consumer to associate the Web site with that of Himalaya's, the Court added.

This snatch from the judgment of Justice Badar Durrez Ahmed has a technical touch: "If any further evidence of the defendants' conduct in attempting to pass off its Web site as that of the plaintiff's were needed, it is clear from Exhibit P15 wherein the metatag of the source code of the defendants Web site includes the plaintiff's trademark `Himalaya Drug Co'."

Punitive and exemplary damages

Himalaya's claim was for Rs 15 lakh as damages, since Sumit's activities had `seriously eroded, diluted and reduced the value' of Himalaya's site, database and intellectual property and also caused `loss of business reputation and untold hardship'. The Court studied a chart prepared by Himalaya's Finance Department showing `a value on the effort put in for the creation, compilation and hosting of the herbal database' on www.thehimalayadrugco.com.

The chart showed expenditure on the project under three categories, viz. manpower, Web site cost, and average overhead cost. "The total cost as indicated in the chart qua the creation, compilation and hosting of the said database on the plaintiff's Web site comes to Rs 7,94,227," informs the text of the judgment.

Himalaya's counsel Praveen Anand argued that `the loss of revenue method' would not be appropriate for computing damages because the extent of Sumit's business could not be ascertained. "However, compensatory damages may be quantified by adopting the principle of what would be the similar cost of creating such a portal, had the defendants not copied the contents of the plaintiff's Web site," said Anand. "Obviously a good measure would be the cost incurred by the plaintiff itself for the creation of such a Web site. Therefore, compensatory damages to the tune of Rs 7,94,227 can be easily awarded to the plaintiff," said the Court.

Anand had also prayed for `punitive and exemplary damages', relying upon a January 2005 decision of the Delhi High Court in Time Incorporated vs Lokesh Srivastava. "In that decision, the Court had observed that in cases of infringement of, inter alia, copyrights, courts should not only grant compensatory damages but award punitive damages also with a view to discourage and dishearten law breakers who indulge in violations with impunity out of lust for money so that they realise that in case they are caught, they would be liable not only to reimburse the aggrieved party but would be liable to pay punitive damages also, which may spell financial disaster for them," recounted Justice Ahmed about the precedent.

Here is more: "The learned judge was of the view that if a tortfeasor is caught only half the time he commits torts, then when he is caught, he should be punished twice as heavily in order to make up for the times he gets away. In that case, the learned Judge awarded an amount of Rs 5 lakh by way of punitive damages equivalent to the damages of Rs 5 lakh which he awarded on account of loss of reputation of the plaintiff."

Applying the same logic to the case on hand, Justice Ahmed awarded punitive damages to the extent of Rs 7,94,227. "The plaintiff is also entitled to a decree of Rs 7,94,227 by way of compensatory damages as well as a decree in the sum of Rs 7,94,227 on account of punitive/exemplary damages in the plaintiff's favour and against the defendants," he ruled. "The plaintiff is also entitled to costs. The damages awarded shall be payable by the defendants jointly and severally and shall carry interest at 9 per cent per annum from the date of the decree till date of payment."

The court thus applied "a moral medicine to a mortifying mischief." But that's a line of the Bard, again, from Much Ado About Nothing.

Cases@TheHindu.co.in

Picture by K. Pichumani

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