Protection Of Confidential Information Under Copyrights
Markets and Markets Research Pvt. Ltd. is a company that provides quantified research and market intelligence to corporate and institutional clients using confidential and proprietary research methodologies. The company's high-profile clients purchase market-specific reports generated by these methods. Meticulous Market Research Pvt. Ltd., a direct competitor of the plaintiff, is also engaged in the same business. The plaintiff alleges that the defendant copied the format and content of its market research reports to create their own reports. The plaintiff discovered this when the Vice President of the defendant, who was also a former employee of the plaintiff, offered to sell a report titled "Continuous Manufacturing Market" that was identical to the one published by the plaintiff in April 2017. Additionally, a criminal complaint was filed against the defendant for suspected theft of confidential data, including client information and data.
Upon comparing the reports of the plaintiff and defendant, the Court observed that the defendant's reports were strikingly similar to those of the plaintiff, with identical titles, similar table of contents, and a substantial portion of the content. Although the full reports of the defendant were not accessible to the plaintiff, information available on their website suggested that the defendant had at least copied the titles of 91 reports of the plaintiff. The Delhi High Court acknowledged that the plaintiff owned the copyright to its reports, which contained confidential information. Despite this, the Court found a prima facie case of copyright infringement and determined that the balance of convenience favored the plaintiff. Consequently, the Court issued an ex parte ad interim injunction, prohibiting the defendant from advertising and selling the disputed market research reports.
The plaintiff's reports contain both copyrightable expressions and commercially viable secret information, which can be protected under different legal frameworks. In addition to the claim of copyright infringement, the plaintiff has alleged that their confidential information was disclosed without their consent, leading to a criminal complaint for suspected theft of confidential data, including client information and data. Although the Court found that the defendant had violated the plaintiff's original work, it did not provide an analysis of whether there was a theft of confidential data. The Court merely noted that the plaintiff's reports contain "trade secrets and confidential information," without explaining the legal basis for classifying the reports as such. The lack of clarity on what can be considered confidential information raises several questions, including whether the Court has safeguarded the information through the Contract Act, equity and common law, or within the ambit of copyright law. Moreover, the legal criteria used by the Court to classify the plaintiff's reports as confidential information is unclear. For instance, can information be considered confidential if it is shared within a company? If it is "commercially viable secret information," what evidentiary burden is required for it to be classified as such? The Court's lack of transparency in providing reasoning affects the jurisprudence and the precedential value that this case sets.
In the current case, the Delhi High Court had the option to examine whether the plaintiff's confidential information could be protected under the Indian Contracts Act, 1872 or whether their client information stored in databases could be considered copyrightable material under the Copyright Act, 1957. The Delhi High Court has implicitly acknowledged in Richard Brady v. Chemical Process Equipment Pvt. Ltd. that protection of confidential information from infringement can be achieved by considering client data as copyrightable material under the Copyright Act, 1957. This position is reflected in the following statement made in the present case:
"The plaintiff claims that their reports, including each element thereof, are original work of copyright and contain trade secrets and confidential information. The defendant's actions have resulted in the infringement of the plaintiff's copyright." (¶31)
Similarly, in Indian Explosives Pvt. Ltd. v. Ideal Detonators Pvt. Ltd. and Ors., the Calcutta High Court protected the plaintiff's confidential information under the Copyright law and issued an order restraining the respondents from disclosing such information.
It is unsurprising that in the current case, the court followed previous rulings. However, it is important to note that although there are orders protecting confidential information under copyright law, it is unclear whether misappropriation of such data, specifically industrial espionage, can be established if the defendant's employees were previously subject matter experts for the plaintiff's research. Due to the lack of case law and empirical data on this matter in India, there is little clarity. It would have been wise for the court to provide an order addressing the disclosure of confidential data and its implications.
In India, protecting confidential information and enforcing related rights is generally done through the Indian Contract Act, 1872, the Copyright Act, 1957, or common law and equity remedies, as there is no specific statute or legislation for this purpose. As Prashant Reddy noted in his paper, while the legal framework for safeguarding confidential information exists in India, it is important to reform the law to ensure that the codification process is effective.
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