Copyright Infringement Traps for Indian SMEs: Unmask the Risks & Protect Your Success

In today’s rapidly evolving business landscape, your ideas are your currency. Protecting your intellectual property, including your unique creations, is crucial for Indian SMEs and businesses to thrive. Unfortunately, the ever-present threat of copyright infringement can tarnish your brand, stifle innovation, and even land you in legal trouble.

This blog demystifies copyright infringement for Indian SMEs and empowers you to safeguard your creativity.

What is Copyright Infringement?

Simply put, copyright infringement is the unauthorized use or reproduction of someone else’s copyrighted work. Think of it as taking someone else’s intellectual property and passing it off as your own.

In India, the Copyright Act, 1957, grants exclusive rights to authors of original works to control their reproduction, distribution, adaptation, and translation. Breaching these rights without permission constitutes copyright infringement.

Types of Copyright Infringement

It comes in two primary forms: primary and secondary. Understanding these distinctions is crucial for Indian SMEs and businesses to effectively protect their intellectual property. Let’s delve into each type and provide examples that resonate with the Indian context. To avoid types of copyright infringement and safeguard your creative assets, it’s essential to be aware of these fundamental classifications.

Primary Infringement

Primary infringement directly violates a copyright holder’s exclusive rights. It encompasses unauthorized activities associated with core copyright privileges. Here are key examples:

1. Reproduction without Authorization: This involves copying, duplicating, or reproducing copyrighted material without consent. For instance, if a competitor in India replicates an SME’s software program without permission, it’s a clear case of primary infringement​​.
2. Unauthorized Distribution: Distributing copyrighted material without consent constitutes primary infringement. This includes selling counterfeit DVDs of copyrighted films, a common issue faced by businesses in India.
3. Unlicensed Public Performance: Publicly performing copyrighted work without proper licenses is primary infringement. An Indian restaurant playing copyrighted music without licensing agreements is an example.

Secondary Infringement

Secondary infringement relates to activities indirectly facilitating primary infringement. Though not directly infringing, individuals or entities contribute to or benefit from copyright violations. Here are secondary infringement examples:

1. Inducing Infringement: When someone intentionally encourages or induces others to infringe copyrights, it’s secondary infringement. An online platform in India promoting the use of pirated software falls into this category.
2. Contributory Infringement: This occurs when entities knowingly provide tools, services, or resources aiding primary infringement. An Indian website offering a platform for users to share copyrighted content without proper authorization contributes to copyright violations.
3. Vicarious Infringement: Vicarious infringement happens when an entity benefits from primary infringement conducted by others under its control. For example, if an Indian e-commerce platform knowingly allows vendors to sell counterfeit products and benefits from these sales, it may be liable for vicarious copyright infringement.

Understanding these distinctions empowers copyright holders to address infringement issues effectively. By being aware of these concepts, businesses in India can navigate the copyright protection landscape more effectively.

Types of Copyrightable Content:

From your unique logo and website design to your marketing materials and software code, various creative works can be copyrighted. Here are some common examples in the business context:

1. Literary works: Business reports, brochures, presentations, product manuals, website content.
2. Artistic works: Logos, graphics, illustrations, photographs, packaging designs.
3. Musical works: Jingles, background music used in marketing or promotional materials.
4. Software and technology: Applications, databases, algorithms, website layouts.

How Copyright Works in India:

While copyright protection automatically applies to original works upon creation, registering your copyright offers several benefits. It strengthens your claim to ownership, simplifies legal proceedings in case of infringement, and facilitates evidence presentation. Registration can be done online through the Copyright Office of India website:- https://copyright.gov.in/

Common Scenarios of Copyright Infringement in Indian SMEs:

1. Website design copying: Borrowing another business’s website layout, graphics, or content without permission. (Example: A boutique owner copies the product descriptions and website theme of a popular online clothing store.)
2. Software piracy: Using unlicensed or illegally copied software for business operations.
3. Content plagiarism: Reproducing another company’s marketing materials, blog posts, or whitepapers without attribution. (Example: An IT service provider lifts entire paragraphs from a competitor’s white paper on cybersecurity best practices.)
4. Brand logo infringement: Using a logo deceptively similar to another established brand. (Example: A local coffee shop adopts a logo very similar to the iconic mermaid image of a global coffee chain.)
5. Social media copyright infringement: Sharing copyrighted content like music, videos, or images on Instagram and Facebook without permission or proper credit. (Example: A restaurant posts a popular song as background music in its Instagram stories without licensing it from the artist.)

Penalties of Copyright Infringement:

Copyright infringement in India can lead to significant penalties, both civil and criminal. Here’s an overview of the potential punishments for infringement of copyright:

Civil Penalties

1. Injunction: A court may issue an injunction to prevent the infringer from continuing the unauthorized use of the copyrighted work, which is a common punishment for infringement of copyright.
2. Damages and Accounts of Profits: The copyright holder can claim monetary compensation for the loss incurred due to the infringement or demand an account of profits made by the infringer through the unauthorized use.
3. Delivery of Infringing Copies: The court may order the infringer to hand over all infringing copies of the work, including the materials used to produce them.

Criminal Penalties

1. Imprisonment: Under the Indian Copyright Act, 1957, the punishment for infringement of copyright can include imprisonment for a term ranging from six months to three years.
2. Fines: A monetary fine ranging from ₹50,000 to ₹2,00,000 may be imposed on the infringer as part of the punishment for infringement of copyright.
3. Seizure of Infringing Goods: Any copies of the infringing work, as well as equipment used to produce them, can be seized by authorities as a punitive measure.
4. Repeat Offenses: Repeat offenders may face enhanced penalties, including longer imprisonment and higher fines.

Additional Consequences

1. Legal Costs: The infringer may be required to pay the legal costs incurred by the copyright holder as part of the punishment for infringement of copyright.
2. Reputation Damage: Besides legal repercussions, individuals or businesses involved in copyright infringement may suffer reputational harm, affecting their credibility and future business prospects.

The punishment for infringement of copyright is designed to protect the intellectual property rights of creators and to deter violations. It’s essential to respect these rights and obtain the necessary licenses or permissions when using copyrighted materials to avoid severe legal and financial consequences.

How to Avoid Copyright Infringement:

1. Seek permission: Always obtain prior written consent from copyright owners before using their work.
2. License content: Invest in legitimate licenses for software, images, and music.
3. Create original content: Invest in your own creative team and develop unique branding elements.
4. Educate your employees: Raise awareness about copyright laws and best practices within your organization.

Fair Use and Exceptions:

Fair use allows limited borrowing of copyrighted material for purposes such as criticism, news reporting, education, and research. However, fair use is a complex concept with nuanced interpretations. Consulting a legal professional for your specific case is recommended.

Copyright Enforcement and Remedies:

Copyright owners have various legal options to enforce their rights, including sending cease-and-desist notices, filing lawsuits, and seeking damages. Additionally, India has robust anti-piracy mechanisms to protect software and creative works.

Case Studies:

Here are some examples of copyright case studies in the Indian SME context, along with key takeaways for SMEs:

1. YRF vs Sri Sai Ganesh Productions (2010):

Case: Bollywood production house YRF accused a smaller competitor of copying their movie “Band Baaja Baaraat” for their film “Jabardasht.” Takeaways: Courts consider similarities in concept, theme, character, plot, and expression for copyright infringement. Significant similarities can lead to injunctions and damages.

2. Hawkins Cooker Ltd vs Magicook Appliances (2011):

Case: Hawkins sued Magicook for using their copyrighted label and cookbooks. Takeaways: Copyright protection extends to designs, logos, and literary works. SMEs should be careful not to imitate established brands’ intellectual property.

3. Super Cassettes Industries Limited vs YouTube and Google (2013):

Case: Music company Super Cassettes sued YouTube and Google for hosting infringing audio content. Takeaways: Online platforms can be held liable for hosting infringing content. SMEs should consider copyright licensing options for online distribution.

Conclusion:

Protecting your intellectual property is an essential investment for any Indian SME. By understanding copyright laws, respecting others’ creations, and implementing proactive measures, you can build a resilient business based on originality and innovation.

Additional Resources:–
Copyright Protection in India: Registration Process, Filling Fee, & Regulation