India: M/S Neologik India Infringes SAP Aktiengesellschaft’s Copyright In Computer Programmes.

Last Updated: 1 July 2011
Article by Sonam Lhamu Bhutia

In SAP Aktiengesellschaft & Anr (Plaintiff) Vs. Sadiq Pasha, Proprietor M/S Neologik India (Defendant), SAP filed a suit for permanent injunction seeking to restrain Sadiq Pasha from infringing it's copyright.

SAP Aktiengesellschaft is a software development firm incorporated in Germany, Plaintiff No 2 in this case is SAP's Indian subsidiary, that has been incorporated to conduct its business in India. SAP intended to be granted an injunction restraining Sadiq Pasha from reproducing/installing and /or using pirated/unlicensed software programmes of SAP including SAP R/3 and ABAP/4 for the purpose of training or otherwise.

The Defendants were proceeded ex parte.

By way of ex parte evidence, an affidavit was submitted by SAP. It was stated therein that:

  1. SAP R/2 was developed and introduced by the Plaintiff company in the year 1979 and SAP R/3 in the year 1992.
  2. The products of the Plaintiff company are tailored to meet the specific needs of each customer and are not available off the shelf or through e-stores, etc and are not bundled with any OEM computer hardware.
  3. The software programmes of the Plaintiffs require specially trained software professionals to load, execute, access, employ, utilize, store and display integrated end-to-end solutions derived from such software products and the Plaintiffs have entered into several specific arrangements with third parties for imparting professional training to work on Plaintiff's software programmes.
  4. The Plaintiff company's computer programmes were first published in Germany and are registered there, that they were created by the Plaintiff company's employees and are original literary works as contemplated in Section 2(o) and Section 13(1) of the Copyright Act, 1957.
  5. India and Germany are both signatories to the Berne Convention and Universal Copyright Convention.
  6. A thorough search of the Plaintiff's database revealed that not even a single valid license subsists in favour of the defendant.
  7. Two servers having pirated version of the Plaintiff's computer programme SAP R/3 Version 4.7 IDES was recovered by Police in the raid on 19th October, 2004 from the Defendant.
  8. Within three months of Police action, the Defendant again resumed his illegal activities of imparting unauthorized training in Plaintiff's software products.

Additionally, the report of a Local Commissioner appointed by the Court revealed that three servers and twelve desktop computers were found in the premises of M/s Neologik India.

The Court noted that the plaintiff had discovered on the defendant's website, '' and two separate advertisements published in "The Economic Times" on 31 January 2005 and "Career Profile" on 14th February showed that the defendant was imparting training in SAP R/3 and claimed to be real-time consultants in SAP and implementation. Further, despite notice form the Plaintiff and seizure of their servers, the defendant continued to conduct SAP training freely and also continued advertising his services on a regular basis.

Section 51 of the Copyright Act, 1957 provides that Copyright in a work shall be deemed to be infringed

(a) When any person, without a licence granted by the owner of the Copyright or the Registrar of Copyrights under this Act or in contravention of the conditions of a licence so granted or of any conditions imposed by a competent authority under this Act-

(i) Does anything, the exclusive right to do which is by this Act conferred upon the owner of the copyright,

Section 14 of the Copyright Act 1957 provides that copyright means the exclusive right subject to the provisions of the Act, to do or authorize to do the specified acts in respect of a work or any substantial part thereof, which in the case of a computer programme would include the reproduction of a work in any material form including the storing of it in any medium by electronic means. The Court held that the Defendant had infringed the copyright of the Plaintiff as it had been found in evidence that the Plaintiff had issued no license to use the aforementioned software to the defendant. Further, the Defendant, on their part offered no explanation or clearance that the software found loaded in its hardware was not pirated software.

Section 40 of the Copyrights Act provides, that the central Government may, by order published in the Official Gazette, direct that all or any provisions of the Act shall apply to work first published in any territory outside India to which the order relates in like manner as if they were first published within India. Para 3 of the International Copyright Order 1999, published in the Gazette of India put the aforementioned Section into practice. Accordingly, it provides that all provisions of the Copyright Act, 1957 except those in Chapter VIII and those other provisions which apply exclusively to Indian works extend to any work first made or published in any country mentioned in Part I, II, III, IV or VI of the Schedule in like manner as it were first published in India. Germany is one of the countries mentioned in Part I. Paragraph 2 of the aforesaid order provides that "Berne Convention Country" means a country which is a member of the Berne Copyright Union and includes a country mentioned either in Part I and II of the Schedule.

The Court, thus stated that in view of these conventions, the provisions of the Chapter XI of the Copyright Act including Section 51 which deals with infringement of copyright would apply to the copyright registrations of the Plaintiff.

It was, therefore held that the Defendant by using the pirated software R/3 and by imparting training using the aforesaid software had infringed the copyright of the Plaintiff and injunction was granted in favour of the Plaintiff.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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