TORT IN INTELLECTUAL PROPERTY*

1. Introduction

Intellectual Property

Intellectual property can be defined as intangible products of a person's mind and

skill. According to Wikipedia - Intellectual property (IP) is a number of
distinct types of legal monopolies over creations of the mind, both artistic and
commercial. Under intellectual property law, owners are granted certain exclusive
rights to a variety of intangible assets, such as musical, literary, and artistic works;
ideas, discoveries and inventions; and words, phrases, symbols, and designs. Common
types of intellectual property include copyrights, trademarks, patents, industrial design
rights and trade secrets in some jurisdictions.

Tort in Intellectual property

Tangible property like land is protected from interference by trespass and conversion
and from carelessly inflicted harm by the tort of negligence. But what
of a person's interest in the results of his intellectual efforts? To what are works of art
and literature or scientific inventions afforded protection by the law of torts?
Copyright Act 1957, Design Act 1911 protects authors, writers and musicians from
those who would 'pirate' their efforts. The Patents act 1970 safeguards new scientific
and technological inventions while Trade Marks Act 1958 supplements the tort of
passing off by enabling traders to register their trademark, rendering any infringement
of that mark actionable. Designs are also protected by statute. The majority of
intellectual property rights provide creators of original works a form of temporary
monopoly with the aim of creating an economic incentive to develop and share ideas.1

2. Torts in IP under laws

Intellectual property law is expressed in both statutory law (such matters as copyright
and obscenity) and common law (several of the common torts). These are explained
briefly as:-

2.1 Statutory Law2

Copyright infringement can result (in extreme cases) penalties and more often civil
judgments, including seizure and destruction of the infringing materials (books,
periodicals, web sites, movies, videotapes, recordings). Any party (such as a printer or
duplicating business) participating in an infringement can be held liable regardless of
knowledge of the infringement. Actual litigation against parties who do it
unknowingly has been rather rare (although one duplicating service was burnt badly
in 1991 for duplicating pirated study guides). Probably the most controversial concept
in copyright law is "fair use." Technically, fair use exists only as a defence, although

*Richa Garg,2nd year, Rajiv Gandhi School of Intellectual Property Law, IIT Kharagpur
1
Street on torts by John Murphy
2
http://www.doaskdotell.com on 4th aug from google search.
its application is reasonably predictable. Limited reproduction of or, especially,
quoting from copyrighted works may be done without permission, depending on
(1) The purpose or character of the use, with a preference intended for educational
and non-profit purposes. (2) the nature of the copyrighted work (3) the amount of
material copied in relation to the whole and (4) the effect of the copying on the
potential market for the work.

Giving few examples of fair use litigation Harper & Row v. Nation (1985) 3, Harper
& Row v. Liveright (1982), Hamilton v. Salinger (1986). In these cases these
questions were answered-(1) would a non-profit organization be allowed more leeway
in a fair use determination than an individual acting on his own (presumably for
profit)? Could the individual's overall business conduct affect a fair-use
determination? For-profit enterprises can claim fair use; most publishers have policies
regarding permissions required for quoting. (2) Is the forwarding of a wire-services
news release to an "educational" email list-server fair use?

Sometimes companies will protect proprietary material from claims of “fair use” by
maintaining that (for example, software manuals) are “unpublished” and may not even
be referenced bibliographically. This may be dubious, although companies certainly
may protect trade secrets and any licensed materials. Even so, when companies write
their own internal manuals companies must comply with copyright laws, and there
have been a few lawsuits when employees have plagiarized materials from other
companies or from previous employers.

Another interesting concept: what is and what is not copyrightable. For example,
ideas are not copyrightable. Anyone can discuss in a book, say, the military sociology
underlying "Don't Ask, Don't Tell." Also, titles are not copyrightable (but see
trademarks, below). Mrinalini Kochupillai with SPICY IP says "In India, there is no
law that prohibits copyright protection from being granted to recipes." In Govindan v
Gopalakrishna (1955 – case relating to compilation,quoted in Burlington), it was held
that even if the amount of originality in a compilation is very small, the same is
protected by law and no one can appropriate the result of another's brain, skill or
labour even in such works. Arguably, if a small creative input in a compilation is
copyrightable, a recipe, particularly original instructions in a recipe will certainly be
copyrightable in India. 4

On the other side, one does not generally need permission to give a bibliographic
reference or even a url link on a website (there can be problems with a link internal to
a site if it bypasses advertising that the site operator intends all visitors to see). There
are rare exceptions, such as with classified documents or trade secrets, or
“unpublished” internal documents of corporations or for customers. But in at least one
case, a consulting firm KPMG has objected to private individuals to even simple links
(at least in connection with criticisms of the company). There is an Australian website
peekvid.com that reportedly (according to a story on NBC4 on January 23, 2007)
offers links to downloadable pirated copies of movies, including movies not yet
released. Because the site offers just links, it is more difficult for the MPAA to make a
legal case to sue.
3
(1985) SC 471 U.S. 539
4
Supreme court on Trademarks,copyrights,patents and designs(1950 to 2005),2nd Edition, Om book
house publishers
Walter S. Mossberg provides The Wall Street Journal, March 10, 2005, a “Personal
Technology” column, “Google Toolbar Inserts Links in Others’ Sites And That’s A
Bad Idea,” discusses the controversial Google “Autolink.” First Amazon and then
Google caused controversy by offering total-book searching. Google plans to scan
most books (apparently not just those in public domain) and offer excerpts to users,
with its Library Project. Google would not earn direct revenue, “only” advertising, but
will pay a royalty if the user purchases a hardcopy or e-copy of the entire book
through its site. Nevertheless, the Authors Guild and some other parties have filed suit
claiming copyright infringement. One problem seems to be that Google is storing
complete book text on its own servers rather than publishers’ servers, and most of
these are books that are now out of print.

A special concern with copyright is plagiarism, the “use or passing off as one’s own
ideas or writings of another” A very common example of this is when people write
ideas or some writings of other people and do not quote it. According to the PBS
Lehrer hour on January 28, 2002, Harvard University strictly includes the failure to
use quotation marks, even accidentally, as plagiarism and will seriously discipline any
student for even one accidental infraction. In an interesting case, In April 2006
publisher Little Brown withdrew the novel How Opal Mehta Got Kissed, Got Wild
and Got a Life by Harvard student Kaavya Viswanathan for excessive similarity
(whether subconscious and unintentional) to novels by Megan McCafferty which
Viswanathan had read in high school. The new novel was popular with young readers
and on the way to becoming a best seller. Viswanathan had worked with a book
packager which had helped her develop the story.

Work for hire is still another controversial topic. Employers own the copyrights to
works created by their employees during the course of employment. Generally,
employees may create intellectual property works outside of their employment with
full copyright ownership of their own work, but employees may not pass along
confidential information in these works, and there must be significant distinction
between the work and what was done in employment. The work for hire provision of
the Copyright Act probably provides informal support for the notion that in most
circumstances a non-management salaried employee may own (outside of the scope
of employment) his own "publicity rights"

Piracy and illegal downloading of music and movies in the age of the Internet,
particularly through peer-to-peer-computing. Software vendors and even ISPs face
possible downstream liability if they knowingly abet in infringement. The main area
of infringement is music songs and movie piracy, as well as making or distributing
pirated copies of software. Many people, especially teenagers, have trouble
understanding why such downloads are and should be illegal. The Software
Publishers Association audits businesses for compliance with software licenses. ISP’s
might be exposed to “contributory infringement” in copyright, trademark, defamation,
and other IP situations if they have knowledge of the infringement. This has led to
suggestions that ISPs not monitor their customers’ activities. There might be more
downstream liability concerns specifically for copyright than other torts because
sometimes copyright laws are interpreted as holding middlemen responsible. 5

Paraphrase is often suggested as an antidote to plagiarism or copyright infringement

problems, but it should be done in good faith. Many news sites have disclaimers like
"this material must not be published, broadcast, rewritten, or redistributed." The
"rewritten" would seem to prohibit paraphrase in blogs. A case for it is X17 Inc. v.
Lavanderia, Citizen Media Law Project, where a gossip blogger posted other's
Internet photos without permission.

A patent protects the inventor of a functional process or manufactured item. However,

up to a point, software programs or “methods” may be patented. This has caused
some controversy, because sometimes a patent-holder may be able to restrict the uses
of his process by the end-user by charging the end-user for additional licenses or by
requiring the intermediate software vendor (using the process) to properly license the
specific customer uses. For example there is a case of the controversy over Unisys’s
patent of the compression algorithms used in producing .gif files for the web.
Apparently, other side in this case said that this patent expired in the United States on
June 20, 2003 but is still valid in Europe and many other countries.

Trademarks A trademark is a phrase (trade or service name) or graphical entity that

identifies a business and its products or services. Abandonment of a trademark
application would probably negate a future common law trademark infringement
claim. Recently, there have been battles between large companies protecting their
brand-names from distraction by small businesses, such as amazon.com and a
women's bookstore in Minneapolis, or the Wall Street Journal and a New England
kid's newspaper, the Small Street Journal. Large retailer, publishers or movie studios
may fear that the opportunities for huge profits from a "public splash" can be lost to
competition from very small businesses. Trademark infringement, like copyright
infringement, can result in cease-and-desist letters, judgments, and orders to destroy
all offending materials. Some domain name v. mark issues remains unresolved. What
happens if a person with a name identical to a celebrity’s wants to use that for his
domain name?

A related problem is called phishing, which is the intentionally deceptive misuse of a

commercial trademark or wordmark, sometimes for identity theft or fraud purposes,
especially “attempts to trick account holders to give their account authentication
details away. In January 2007, Jeffrey Brett Goodin of California,AOL.

Obscenity refers to intellectual property (writing, pictures, recordings, etc.) which

appeals primarily to the prurient interest and is, according to community standards,
utterly without redeeming social value. The community standards concept is troubling
with a medium like the Internet (which cannot be excluded in a particular area the
way a book or movie can).

Indeceny refers to content which is sexually explicit in a patently offensive way,

regardless of redeeming social value. But the Supreme Court overturned the

5
Published paper by Jim Harper at CATO
Communications Decency Act in 1997. These are Harmful to minors means,
essentially, "obscene with respect to minors." So come under social wrongs.

2.2 Common Law

Publication means making a work available to the public by issue of copies or by

communicating the work to the public.6 The transmission of a written (or electronic)
message to at least one other person who understands it (for purpose of libel and
invasion of privacy) is illegal and is prohibited. For other purposes, the term means
the offering and distribution to the public of a completed piece of intellectual
property. Usually, a piece of writing cannot have legal consequences unless it is
presented to at least one person.

Libel refers to publication of written false, defamatory statements about another

(living) person or corporate or organizational entity. Whether a statement is
“defamatory” may depend on community standards or general societal values as well
as the subject’s livelihood. For example, it would be libelous to falsely claim in
published writing that a particular member of the U.S. Armed Forces is (“subjunctive
mood”) in a homosexual relationship (even with an adult civilian). A serious concern
is "indirect libel" in fiction, if even one reader can identify a poorly disguised
(renamed or unnamed) character (and if that reader did not otherwise know about the
implied defamation). Important cases are The Bell Jar and Touching, Bindrim v.
Mitchell7 (1979).

Another point is that a false defamatory written (or oral) statement need be made
available to one person (say, someone's boss or spouse) to instantiate the possibility of
libel . In the context of libel, “publication” means a written statement to at least one
other person who understands it (it could be an email or a letter), whereas generally
“publication” refers to making intellectual property available to a large universe.
Fair Report Privilege" encourages journalists to use official public records and
government agency reports. Reprinting false defamatory information already
published by others, even if attributed properly, could expose one to a libel claim
(even if this is rather infrequent).

Invasion of Privacy: This tort refers to publishing private (and, generally speaking,
offensive) information about a (living) person and inflicting emotional injury or
causing the person to lose economic or personal opportunity.

1-Disclosure of Private Facts: The publication of highly offensive private

information about a person. There is controversy about whether a person's life can
become irrelevant with the passage of time. Mewshaw v. Dresbach. See Richard
Goldfarb and Gail E. Ross, The Writer's Lawyer, Times Books, 1989, p. 133. The
Mewshaw book was Life for Death (Avon); here is a typical reference to the book.

6
Copyright Act of India,1957
7
92 Cal.App.3d 61
However, in that case the court quoted Dean William Prosser: "Once a man has
become a public figure or newsworthy, he remains a matter of legitimate recall to the
public mind to the end of his days." However, according to Goldfarn and Ross, some
courts have ruled that who have served their sentences do have some privacy rights if
they do not continue to voluntarily place themselves into public purview.

2-False Light: The publication of information which is literally true but which tends
to misrepresent the person's character. An example would be reporting that a person
was standing on the street in front of a building that happened to be a "crack house."

3-Misappropriation: Using a private person's name of likeness for commercial

advantage. (Man v. Warner Bros.8). In this case a professional musician, was at
Woodstock, where at 4 A.M. he mounted the stage and played 'Mess Call' on his
Flugehorn. His performance was photographed by the Wadleigh-Maurice camera
crews, and was edited into the documentary without his consent. He brought a
diversity action for injunctive relief pursuant to New York's right of privacy statute,
N.Y.Civ.Rights Law 51 (McKinney's Consol.Laws, c. 6, 1948), and moved for a
preliminary injunction. The defendant made a cross motion for summary judgment,
which was granted. The district court recognized that 51 may not be applied to afford
relief either to a public figure or in a matter of public interest in the absence of proof
that the defendant published false material with knowledge of its falsity or in reckless
disregard of the truth.

4-Intrusion: Intruding upon a person's property.

Invasion of privacy claims (unlike libel claims) usually require the widespread
publication of a fact to many people (as in a book, periodical, newspaper, or web site,
and perhaps a list server). It is probably necessary that a significant number of people
be able to identify an unnamed person to uphold an invasion of privacy claim, unless
the few person(s) who identify the subject are important to the subject. The major
defence in invasion of privacy actions is that a person is a public figure with respect to
a particular issue. A media outlet may report private facts about a person if they are
relevant to an issue in which the person voluntarily associated himself. For example,
it could report that a publicly outspoken gay activist was employed by the Boy
Scouts. The better known the person (such as the president), the more privilege a
writer or media outlet has in reporting his private activities.

3. Other torts in Intellectual Property

The common law doctrine of joint tortfeasors may be applicable to copyright

infringements where two or more parties have acted in a joint enterprise, although the
doctrine would not apply if the actions of the parties had only individually assisted or
contributed to an act causing damage. 9

A corporation can only act through natural persons, such as its employees. If an
employees commits a civil wrong while acting within their scope of employment, the
corporation will be vicarious liable. A corporation can be primarily liable, in some

8
317 F.Supp. 50 (S.D.N.Y.1970).
9
WEA International Inc v Hanimex Corporation Ltd (1987) 10 IPR 349
cases where acts or omissions of senior management personnel are attributed to the
corporation. These people are seen to be part of the corporation’s directing mind and
will, rather than acting on behalf of the company. The state of mind of those who
direct the company will be deemed to be that of the company for the purposes of
determining liability in cases involving a mental element, such as knowledge of
copyright infringing activities.10

The United States Court of Appeals for the Second Circuit has certified a question to
us that asks whether the common-law cause of action of conversion applies to certain
electronic computer records and data.11 According to the facts of the case Plaintiff
Louis Thyroff was an insurance agent for defendant Nationwide Mutual Insurance
Company. In 1988, the parties had entered into an Agent's Agreement that specified
the terms of their business relationship. As part of the arrangement, Nationwide
agreed to lease Thyroff computer hardware and software, referred to as the agency
office-automation (AOA) system, to facilitate the collection and transfer of customer
information to Nationwide. In addition to the entry of business data, Thyroff also used
the AOA system for personal e-mails, correspondence and other data storage that
pertained to his customers. On a daily basis, Nationwide would automatically upload
all of the information from Thyroff's AOA system, including Thryoff's personal data,
to its centralized computers. The Agent's Agreement was terminable at will and, in
September 2000, Thyroff received a letter from Nationwide informing him that his
contract as an exclusive agent had been cancelled. The next day, Nationwide
repossessed its AOA system and denied Thyroff further access to the computers and
all electronic records and data. Consequently, Thyroff was unable to retrieve his
customer information and other personal information that was stored on the
computers. Thyroff initiated an action against Nationwide in the United States District
Court for the Western District of New York, asserting several causes of action,
including a claim for the conversion of his business and personal information stored
on the computer hard drives. Nationwide countered that a conversion claim cannot be
based on the misappropriation of electronic records and data because New York does
not recognize a cause of action for the conversion of intangible property.

Actions for negligent misstatement as to the capacity and suitability of software and
hardware solutions being sold are also an important consideration for vendors of these
systems when dealing with customers who have little or no knowledge of the
technical specifications of such products. In determining whether an action for
misstatement may be brought, the following issues ought to be considered12

 The advice must be required for a purpose, either specified in detail or

described in general terms;
 The purpose must be made known, either actually or inferentially, to the
advisor at the time the advice is given;
 The advisor must know, either actually or inferentially, that the advice will be
communicated to the advisee, either as a specific individual or as a member of

10
Tesco Supermarkets Ltd v Nattrass [1972] AC 153
11
Louis E. Thyroff, Appellant, v. Nationwide Mutual Insurance Company, et al., Respondents. 2007
NY Slip Op 02442
12
Caparo Industries plc v Dickman [1990} 1 All ER 568 (HL)
 an ascertainable class in order that it should be used by the advisee for the
known purpose;
 it must be known, either actually or inferentially that the advice will probably
be acted upon for that purpose without independent advice or inquiry;

 the advice must be so acted upon to the detriment of the advisee

Also the following issues should also be considered to determine whether a duty of
care exists in relation to misstatements13

 The purpose for which the statement was made;

 the purpose for which the statement was communicated;
 the relationship between the advisor, the recipient of the advice and
any third parties;
 the size of the class to which the recipient of the advice belongs;
 the knowledge and experience of the advisee;
 whether the advisee was reasonable to rely on the advice

Negligence is another tortuous action that needs to be considered, particularly in

relation to customised software as the value of computer programs and the associated
stored data becomes increasingly significant. Questions such as: who is responsible
for backing up data and the customised software; who is to check the integrity of the
backup; who is responsible to monitor the adequacy of the capacity of the hardware to
store the required data must be asked to determine whether there has been
contributory negligence on behalf of the customer in cases where a failure of the
backup or loss of data due to the capacity of the system being exceeded. a supplier
will be providing hardware and or software for the use by a customer with little or no
knowledge of information technology other than that required as an end user. Is it
negligent for a supplier to assume no responsibility in relation to the technical
maintenance required? All computers need regular attention to be given to tasks such
as backing up, removing redundant files, tuning the system for optimal performance
and checking integrity of files. If not, loss of data and an inefficient system are likely
to occur. Ideally, the customer would designate a systems operator who is responsible
for performing or supervising these tasks, but should the supplier ensure that the
appointed person has adequate skills and up to date information available?

In the designing of software, the supplier needs to consider a range of issues which
could include, by way of example only and without limitation, the need to warn of
low hard disk capacity which may prevent actions such as the creation of new files to
store data and the need to inform users of the significance of such warnings and the
required action to be taken to avoid loss of data. Where the supplier is not retained to
carry out maintenance of the system and the customer appoints its own staff
member(s) to perform same, is the customer assuming the responsibility thus
protecting the supplier from claims of negligence?

4. Duty to avoid tort in IP

13
James McNaughton Papers Group Ltd v Hicks Anderson & Co [1991] 1 All ER 134 (CA)
There are certain things which need to be kept in mind so as to avoid torts in
Intellectual property. Those are:-

4.1 Obligation of confidentiality: - The grant of a patent protects research processes

only once they have concluded in novel invention. At that stage, production of a
cheaper, ‘copycat version’ may constitute an infringement of the patent. The common
law now extend a degree of protection to all victims of breaches of confidence.

4.2 Justifiable disclosures: - Disclosure of confidential information may be justified

in public interest. A legitimate interest in subject matter of information must be
proved. Disclosure of evidence of ‘iniquity’ will always be justifiable.

Competing interests interests - The patents right to confidentiality versus the potential
risk to third parties pose acute problems for doctors. Risk of physical harm to a third
party is almost certainly sufficient to release a person from the bond of
confidentiality.

5. Remedies
The civil remedies for copyright infringement include the following:

 injunction
 account of profit
 damages for infringement
 additional damages where the infringement is of a particularly flagrant
character
 damages for conversion or detention of infringing copies
 delivery up of infringing copies.

At common law, a release of a joint tortfeasor has the same effect as a

judgment, so that the compromise resulting in the release of one or more
joint tortfeasors in return for payment of a portion of the amount due,
precludes the plaintiff from pursuing his remedy for the balance against
the other joint tortfeasors.14

5. Conclusion

Intellectual property infringement is becoming increasingly easier to commit these

days with a widespread use of internet and other electronic media. To avoid torts in
Intellectual property, Corporations and their directors need to make regular audits of
their intellectual property assets and usage to ensure that the corporation is not
engaging in, or allowing its employees and agents to engage in activities resulting in
intellectual property infringements.

14
Bryanston Finance Ltd v de Vries [1975] QB 703 (CA)
Various laws need to be added or amended to charge the defaulters in case of
infringement in copyrights or for violation of other rights in area of Intellectual
Property.