Painting A New Picture: Supreme Court Recognizes Companies As Victims In IPR Disputes
Painting A New Picture: Supreme Court Recognizes Companies As Victims In IPR Disputes
Introduction
The Supreme Court of India has ruled that a company can be considered a "victim" under the Code of Criminal Procedure (CrPC) and file an appeal against an acquittal order in criminal cases, including intellectual property rights (IPR) violations.
Factual Background
Asian Paints, a leading manufacturer in the paint industry, engaged an IPR consultancy firm to track and take action against counterfeiters. In February 2016, the consultancy firm found counterfeit products resembling Asian Paints' trademarks at the shop of "Ganpati Traders" owned by Ram Babu in Rajasthan. The police seized 12 buckets of allegedly fake paints, but Ram Babu was acquitted by the trial court. Asian Paints challenged the acquittal, but the Rajasthan High Court dismissed its appeal, stating that only the original complainant, not the aggrieved company, could file such an appeal.
Procedural Background
The Supreme Court allowed Asian Paints' appeal against the high court's verdict, raising a significant question of law regarding whether a company can be considered a "victim" under the CrPC.
Issues
1. Definition of "Victim": Whether a company can be considered a "victim" under Section 2(wa) of the CrPC and file an appeal against an acquittal order.
2. Intellectual Property Rights Violations: Whether a company can pursue criminal proceedings as a victim in cases of IPR violations.
Contentions of Parties
Asian Paints' Contentions: Asian Paints argued that it was the victim of counterfeiting and suffered financial loss and reputational injury due to Ram Babu's actions.
Ram Babu's Contentions: Not reported, as the high court had dismissed Asian Paints' appeal.
Reasoning & Analysis
The Supreme Court held that the term "victim" under Section 2(wa) of the CrPC includes any person, natural or juristic, who suffers loss or injury due to the alleged offence. The court found that Asian Paints, as the entity whose brand and reputation were harmed, squarely fits this definition.
Final Outcome
The Supreme Court allowed Asian Paints' appeal, set aside the high court's verdict, and held that a company can be considered a "victim" under the CrPC and file an appeal against an acquittal order in criminal cases, including IPR violations.
Implications
The court's decision has significant implications for companies that suffer from IPR violations, allowing them to pursue criminal proceedings as victims and seek redress for harm to their brand and reputation.
