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19 May 2016

Arbitration of copyright issues, permissible

Bombay High Court has held that copyright issues that arise out of an agreement between parties are subject to arbitration, provided the arbitration clause in the agreement encompasses the same. The court while allowing the matter for arbitration, observed that Section 62 of the Copyright Act, 1957 and Section 134 of the Trademarks Act, 1999 do not oust jurisdiction of arbitral panel. In this case of Eros International Media Limited v. Telemax Links India Pvt. Ltd. the Court observed that it was a mistake to consider intellectual property statutes as relating to rights that stand wholly apart from the general body of law. The Court on 12-4-2016 held that rights under these statutes are special rights, but they are a species of property and share much with their more tangible cousins to whom Acts such as the Sale of Goods Act or the Transfer of Property Act apply.

The Court also held that between two claimants to a copyright or a trade mark in either infringement or passing off action, action and remedy can only be an action in personam and not an action in rem. It was held 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. The arbitration agreement here was part of the ‘Term Sheet’ contemplating an exclusive licensing contract for various audio-visual materials.