Presentation is about the use of alternate dispute resolution methods to resolve IPR disputes its advantages and arbitrability in India

1. Submitted by-Parth Khurana Submitted to-Ms . Avneek Kaur Sethi
5-L , 083.

2. OBJECTIVE’S
▸To understand the need of ADR in IP disputes
▸To understand the different approaches
▸Arbitrability of IP disputes in India
▸Advantages of resolving dispute through ADR

3. INTRODUCTION
As multinational technology-development partnerships have become more common, so
have disputes between the parties. Litigation, however, is not the only option for
resolving such disputes.
In fact, for partnerships between entities in developing and developed countries,
litigation may be a complicated, time-consuming, expensive, and doubtful process.
Arbitration and mediation offer the promise of more effectively resolving disputes, and
this presentation explains how these methods work, their advantages and
disadvantages, and suggests which questions should be asked (especially for a
developing country institution) to begin to establish a dispute prevention and resolution
strategy.

4. NEED FOR ADR IN INTELLECTUAL PROPERTY
DISPUTEThe intellectual efforts of the creators of intellectual property are valued on the basis of the sign of the
rights affixed to ‘intellectual output’. Intellectual property protection provides a pointer to the creator to
exert his powers over third parties, who, without his permission, try to use the fruits of his labour. ; the
available resources could be put to better and proper use by the Courts if the alternate dispute resolution
is deployed. Matters related to patent law and copyright law, which involve intersection with science and
an understanding of technology, need special adjudicating officers, who can comprehend the
interdisciplinary nature of the case at hand with sufficient ease. The limited nature of protection given to
the owner of intellectual property rights, calls for developing mechanisms to execute immediate and swift
justice.
The solution lies in the introduction of alternative dispute resolution mechanisms, for the redressal of
grievances related to infringement of protected rights of an intellectual property holder. Alternative dispute
resolution mechanisms are less time consuming, efficient and provide flexibility to the right holder. It is
important to note that in all the commercial transactions, the route of alternate dispute resolution has
already shown its majority over the traditional modes of litigation. Nowadays, contracts related to transfer
of intellectual property mostly include the “arbitration-mediation” clause. This highlights the weight of
arbitration in commercial intellectual property transactions.

5. APPROACHES OF ADR
For all the general advantages shared by the different ADR processes, there are in fact markedly different characteristics to each of them.
Generally, ADR processes fall into three main categories:
Assistance-Based
Parties have the greatest control over the decision-making process and the final outcome in an assistance-based ADR process such as mediation.
In mediation, the mediator’s aim is to assist the parties in finding a solution to their dispute. The parties have complete control over the final
outcome, and a substantial say in the mediation process. Assistance-based processes are useful when the parties wish to create an outcome that
is tailored to their interests.
Recommendation-Based
Relative to mediation, a recommendation-based ADR process gives parties less control over the decision-making process and the final outcome.
Non-binding expert determination is an example of a recommendation based process.
In expert determination, parties submit a specific issue to an expert, who makes a determination on the matters submitted. The parties can agree to
accept the neutral’s determination as a non-binding recommendation, or as a final and binding decision. Recommendation-based processes are
useful for issues such as the determination of royalty amounts, valuation of intellectual property assets and the interpretation of patent claims.
Adjudication-Based
In an adjudication-based ADR process, such as arbitration, parties have a limited degree of control over the decision-making process and the final
outcome.
As a point for comparison, parties in litigation (being also adjudication-based) have little to no say in the decision-making process and the final
outcome, both of which are determined by the court. In arbitration, even though parties may have some say in the decision-making process, such
as in relation to the scope of the dispute submitted to arbitration or procedural matters, they must accept the final decision made by the arbitral
tribunal. Adjudication-based processes are useful when there is a need for a final decision, and the parties are unwilling or unable to negotiate a
settlement.

6. ARBITRABILITY OF IP DISPUTES IN INDIA
In India, with arbitration becoming a norm for resolution of commercial disputes, the debate is – whether
disputes involving IPR can be referred to and resolved by arbitration?
I
in order to understand the narrative of the debate, it is essential to look at the opinions expressed in
judicial pronouncements.
The High Courts in India have dealt with this very issue and taken a divergence of view.
To add to the conundrum, different Benches of the same High Court have also taken diametrically
opposite views.

7. JUDICIAL PRECEDENTS
Delhi High Court in the case of Mundipharma AG v. Wockhardt Ltd. was dealing with the
provisions of Chapter XII of the Copyright Act, 1957 relating to civil remedies in case of
infringement of copyright. It was held that every suit or other civil proceedings arising under that
Chapter in respect of infringement of copyright in any work or the infringement of any other right
conferred by the Copyright Act shall be instituted in the district Court having jurisdiction.
It was specifically emphasized that in case where copyright in any work is infringed, the remedies
by way of injunction, damages, account and otherwise as are or may be conferred by law for the
infringement of such a right, cannot be subject-matter of arbitration.
In a later ruling, the Delhi High Court in the case of Ministry of Sound International v. M/S Indus
Renaissance Partners held that disputes pertaining to IPR can be arbitrated upon on premise that
there is no absolute bar on arbitration involving questions relating to IPR.

8. In the case of Steel Authority of India Ltd. v. SKS Ispat and Power Ltd., the Bombay High Court considered an application of
the defendants in an infringement suit filed by the plaintiff who had claimed a permanent injunction against the defendants from
infringing the registered trade-marks of the plaintiff. The plaintiff also claimed for damages against the defendants. The
defendants filed a notice of motion under Section 8 of the Arbitration Act relying upon the arbitration agreement admittedly
entered into between the parties in that matter.
The Bombay High Court dismissed the Application under Section 8 on the ground that the suit was for the infringement and
passing off and arise out of rights to a trademark and the remedies in connection therewith which are matters in rem. These
rights and remedies by their very nature not amenable to the jurisdiction of a private forum chosen by the parties such as
arbitration.
In Eros International Media v. Telemax Links, the Bombay High Court was dealing with a case where Eros filed a suit for
copyright infringement against Telemax. Telemax filed an Application under Section 8 of the Arbitration and Conciliation Act,
1996 that owing to the disputes being purely contractual and the parties having agreed to settle them by arbitration, the suit was
not maintainable.
In Eros Media’s Case, the Bench took a different view from that taken in the Steel Authority’s Case and agreed with the
contention of Telemax by concluding that where there are matters of commercial disputes and parties have consciously decided
to refer these disputes arising from that contract to a private forum, no question arises of those disputes being non-arbitrable.
Such actions are always actions in personam, one party seeking a specific particularized relief against a particular defined party,
not against the world at large.

9. ANALYSIS OF LEGAL POSITION
A glance at the judgments of the discussed above leads to the irrefutable conclusion that the issue whether
IPR disputes are arbitrable is still fluid. There is lack of an authoritative pronouncement by the Supreme
Court pointedly covering the issue. The judgments of the Supreme Court have merely dealt with broad
categories
The crux of the discussion is that there cannot be a ‘one size that fits all’ formula for ascertaining whether a
particular IPR can be resolved by arbitration. Each case has to be decided on its peculiar facts and keeping in mind
the issues arising for consideration. As different High Courts have dealt with different fact situations and different
interlinked nuances, a judgment that could have conclusively laid the controversy to rest is still awaited.
Arbitration clauses in contracts in India are now drafted with an all-inclusive approach and such clauses are given
extremely wide interpretation by Arbitral Tribunals and Courts alike. The growing trend of judgments and the
position of law bears testimony to the change from a conservative straightjacket approach to a more pragmatic and
holistic approach in cases involving the arbitrability of IPR disputes. As such, the way forward should be to allow
arbitration of IPR disputes which extends to deciding the validity of IPR though restricting the scope of its
adjudication by making it binding upon the parties to the contract.There is enough force in the form of precedent
and legal framework to bolster this growing trend.

10. INDIA:RISE IN MEDIATION OF IPR DISPUTES
There is no gainsaying the fact that mediation of IPR claims and disputes is slowly
gaining traction in India. In a positive move towards adopting alternative dispute
resolution mechanisms for resolving IPR disputes and in order to deal with
overwhelming backlog, the Controller General of Patent Designs and Trade Marks,
in collaboration with the Delhi Legal Services Authority (DLSA), had referred around
500 pending oppositions and rectifications in the Trademarks Registry(TMR), Delhi,
to mediation and conciliation st under the Legal Services Authorities Act, 1987

11. Another positive step towards mediation of IPR disputes is the introduction of Section 12A in the
Commercial Courts Act of 2015 To mandate pre-institution mediation and settlement in cases where
no urgent relief has been sought. (Under Section 2(c) of the Act, “commercial disputes” include
disputes arising out of intellectual property rights.)The mediation can be conducted by authorities
constituted under the Legal Services Authority Act, 1987. It is required to be completed within a
period of three months and it may be extended by two months. A signed settled agreement between
the parties is to have the same effect as an arbitral award under the Arbitration and Conciliation Act,
1996. Further, the Central Government, on notified Commercial Courts (Pre-Institution Mediation
and Settlement) Rules, 2018 for standardizing such mediation processes. This Amendment and the
subsequent notification of the Rules are welcome steps since they are in keeping with the original
aim of the Act i.e., to bring about reduction in delay of cases. These steps will also encourage
parties to stop depending on external agencies such as Courts for resolving IPR disputes and take
the matter into their own hands.

12. THE WIPO CENTRE
Founded in 1967, WIPO is an agency of the United Nations which aims to promote the protection of intellectual
property through cooperation among States. Within this larger framework, the WIPO Center was established in
1994 as a neutral, independent and non-profit dispute resolution provider. It is the only international provider of
specialized ADR services for intellectual property disputes, and is the leading institution in the administration of
Internet domain name disputes.
The WIPO Center administers mediation, arbitration, expedited arbitration and expert determination procedures
conducted under the WIPO Rules. As of 2018, more than 560 cases with values ranging from USD 20,000 to
several hundred million USD have been administered by the WIPO Center. WIPO ADR services have been used by
businesses of all sizes and research organizations from more than 60 countries. Additionally, the WIPO Center
collaborates with IPOs to raise awareness of the advantages offered by ADR to resolve intellectual property and
technology disputes outside the courts. The WIPO Center also has assisted the establishment of joint dispute
resolution procedures by IPOs, for example, in Colombia, the Philippines, Singapore, the Republic of Korea and
Poland to facilitate the use of ADR processes for disputes administered by these IPOs. The WIPO Center has also
developed tailor-made dispute resolution procedures for specific industries, and provides training programs for
mediators and arbitrators. With its extensive network of intellectual property and ADR experts, and WIPO’s
international neutrality, the WIPO Center stands at the forefront of ADR for intellectual property disputes.

13. GENERAL TRENDS AND LANDSCAPES
WIPO Center, which provides support services for ADR proceedings such as mediation, expert determination, arbitration and
expedited arbitration, has seen an increase in recent years in the number of intellectual property disputes it has administered.
Such disputes spanned a diverse range of legal areas and industries, as illustrated by the following sample charts on WIPO
Center mediation and arbitration case

14. ADVANTAGES OF ADR
Party Autonomy
Intellectual property disputes have distinctive characteristics: they often span multiple jurisdictions and involve highly technical
matters, complex laws and sensitive information. Naturally, parties will want a dispute resolution process that can be tailored to
address these distinctive characteristics. However, litigation can be a highly inflexible mechanism that is constrained by complex
laws, and parties rarely have the discretion to adapt the process to their dispute.
In contrast, ADR gives parties the freedom to customize their dispute resolution process in a single forum. Parties can choose the
ADR process best suited to their dispute: mediation, arbitration and expert determination are all possible options.Parties can agree to
meet at a neutral location, submit to a neutral expert of their choosing, and abide by rules and procedures that they have modified to
meet their needs. Some ADR processes, such as mediation, even allow parties to craft outcomes that address their specific
interests.
Independent Specialized Expertise
Intellectual property disputes can involve highly technical scientific matters and complex legal issues, but not every country has
specialized intellectual property courts or judges.Thus, when judges and juries lack the necessary expertise to fully comprehend the
complex factual, technical and legal issues at stake, considerable time and resources may be required to present the relevant
technologies and laws to them.
ADR processes allow parties to choose a neutral with specialized expertise to act as a decision-maker, or a facilitator.Experts in law,
technology or specific industries can be appointed as neutrals; parties also have the ability to appoint a panel of experts with
expertise in different areas of the dispute. Expert neutrals can use their knowledge and experience to provide guidance during the
ADR process, and to craft a satisfying resolution for the dispute. When capable experts are appointed, ADR processes offer benefits
that would be otherwise unavailable through litigation.

15. Time Saving
Legal proceedings are often time-consuming, which can have an adverse effect on intellectual property rights.
Intellectual property rights of limited duration, such as patents, may expire before a final judgment can be rendered.
In any case, market forces affect the profitable lifespans of intellectual property rights: patented products can be
rapidly rendered obsolete, and trademarks can be time-sensitive if they represent products with short life cycles.
The many advantages of ADR translate into substantial time savings. ADR allows parties to avoid overloaded courts
and duplicative litigation at home, and in other jurisdictions. Expert neutrals do not require time-consuming
explanations of the technical and legal issues at stake, and the stated flexibility and simplicity allow disputes to be
swiftly resolved, especially when lengthy evidential procedures are simplified.
Confidentiality
Confidentiality is often of critical importance in intellectual property disputes. Thus, parties may balk at court
proceedings when trade secrets or proprietary information, such as experimental results from research and
development, are involved.98 Litigation and the discovery process can force the public disclosure of such sensitive
information, which can irreversibly damage the parties’ business prospects.
Confidentiality is a key advantage of ADR because it allows the parties to effectively control disclosures and access
to sensitive information. Proprietary information can be kept confidential through agreements between the
parties,102 and arbitrators can issue protective orders to prevent parties from accessing confidential documents.
Furthermore, unlike litigation, the entire ADR process and its outcome can be kept confidential, which can be
advantageous for parties who wish to preserve their business reputations and relationships.

16. Diverse Solutions – ADR provides a wide range of solutions for disputing
parties. In mediation, parties work to negotiate a win-win solution, where in
litigation there is one winner and one loser, it points out. In arbitration, disputing
parties can set scope and limits of the arbitration.

17. CONCLUSION
Although resolving intellectual property disputes can be technically complex, time-
consuming, resource- draining, and adversarial, ADR offers solutions that can reduce the
complexity, time, cost, and controversy. Whether private ADR neutrals or an ADR service
provider are used, neutral selection is important, especially in complex, technical disputes.
When preparing intellectual property licensing agreements, consider including ADR clauses
for some or all possible issues that may arise.
Separate arrangements ought to be made inside the IP Act’s prescribing the utilization of
ADR for the goals of the questions. Also, acknowledgment ought to be given to the break
alleviation conceded by the arbitral council in IP questions. Furthermore, the legal executive
must recommend the gatherings to pick the different ADR components accessible for
bringing their debates to an end. Intervention in India is at a pre-developed stage. It has
been presented as of late, yet looking at the achievement rate, it tends to be said to go out to
be an extremely productive system for settling IP debates in the coming years.