Turning an IP Dispute into a Business Opportunity
There is a small firm of goldsmiths at Chikpet, Bangalore in the Southern Indian State of Karnataka. Over the years, the goldsmith, assisted by his son, has been creating new designs, making ornaments, and selling them directly to customers. One day, while visiting an upmarket road in downtown Bangalore, he happened to stop at a famous Jewelry retail outlet of a large Indian industrial conglomerate and was horrified to find on display items of jewelry based on some of his original designs.
The goldsmith was shell-shocked and did not know what to do. His son, however, decided not to take things lying down. He approached an intellectual property rights (IPR) Attorney at Bangalore. Although the goldsmith had not registered his novel designs under the Design law in India, he was able to produce before the Attorney the a number of paper-based sketches and drawings (protected automatically by copyright) that he had made earlier in respect of the design in question, which clearly indicated the evolution of the designs. A legal notice was sent to the large Indian industrial conglomerate. In reply the large Indian industrial conglomerate's lawyer argued that there was no malafide and, in fact, the designs had been developed independently by their employees and were co-incidentally common.
On receiving this reply, the goldsmith's son went through the records of sales. In the sale register, he was able to locate the details of sale to the large Indian industrial conglomerate who had purchased from them a few pieces of this presentation item for distribution as New Year gifts. This turned out to be clinching evidence and the large industrial conglomerate agreed to settle the matter out of court. As a part of the settlement, a lumpsum payment was made to the goldsmith. It was also agreed that the large industrial conglomerate would stop manufacturing this item and would outsource its entire requirements over the next five years from the small firm.
This case study provides a number of important insights. Firstly, it shows the importance of keeping good records of any drawings, designs and business transactions that may be used in future as evidence in case of an IP dispute. Admittedly, the case would have been simpler had the goldsmith registered his design under the design law of India in the first place. However, having preserved the drawings in a systematic manner (dated, numbered, signed and properly filed) of the gold ornaments in question and having made proper entries in the sale register showing that the large company had once purchased the items proved crucial in turning the case in the goldsmith's favor. Secondly, it illustrates the importance of relying on qualified IP advice. Thirdly, it shows how an IP dispute, may be turned into a business opportunity, as the large company has now become a key client of the small firm of goldsmiths.