Article: Is mere hosting of a website within territorial limits of the court sufficient for conferring jurisdiction in online trademark disputes?

Author: Sri Lekha

Introduction:

In the 21^st century with the increasing prevalence of e-commerce business, the courts are facing novel legal issues in realm intellectual property rights. Particularly, in cases wherein the dispute arises out of transactions taking place over a website, deciding the appropriate jurisdiction has been a controversial issue. In recent times, the courts have dealt with many cases concerning online trademark disputes wherein the issue pertained to whether mere hosting of a website within the territorial limit of the courts would suffice to confer jurisdiction.

Jurisdiction and Statutory interpretation

The Civil Procedural Code, 1908 (CPC), under Section 20 provides for determination of jurisdiction for filing a suit based on the defendant’s place of business or cause of action. It states that – “…every suit shall be instituted in a Court within the local limits of whose jurisdiction… the defendant…actually and voluntarily resides, or carries on business, or personally works for gain…or the cause of action, wholly or in part, arises…”.

In addition to this general rule, the Trademarks Act, 1999 (“Act”) under Section 134 provides an additional forum for instituting a case based on the plaintiff’s place of business. The courts in various cases employing these provisions analysed a variety of circumstances to decide the issue of jurisdiction in trademark disputes.

Judicial trends on the issue –

One the early cases in which this issue came up was in Banyan Tree Holding (P) Limited v. A. Murali Krishna Reddy & Anr [CS (OS) No.894/2008; order dated November 23, 2009], wherein the plaintiff availed Section 20 of CPC to institute the case before the High Court of Delhi, although neither of the parties resided within the territorial jurisdiction of the Court. The plaintiff in its defense for instituting the case before the High Court of Delhi argued that the defendants have presence and conducted business in Delhi through their website. A Single Judge Bench (S Muralidhar, J.) of the Court analysed the position for determination of jurisdiction in trademark disputes in various common law jurisdictions and held that “…this court does not subscribe to the view that the mere accessibility of the Defendants’ website in Delhi would enable this Court to exercise jurisdiction… the Plaintiff would have to show that the Defendant purposefully availed itself of the jurisdiction of the forum court… It would have to be shown that the nature of the activity indulged in by the Defendant by the use of the website was with an intention to conclude a commercial transaction with the website user.”

Thereafter, the High Court of Delhi further dealt with the similar issue in Millennium & Copthorne International Limited v. Aryans Plaza Services Private Limited & Ors. [CS(COMM) 774/2016; order dated March 5, 2018], wherein a Single Judge Bench (Rajiv Sahai Endlaw, J.) quoted Banyan Tree Holding case and observed that “…the jurisdiction of the forum State does not get attracted merely on the basis of the interactivity of the website which is accessible in the forum State……the nature of the activity permissible and whether it results in a commercial transaction has to be examined……the plaintiff must necessarily plead and show prima facie that the specific targeting of the forum state resulted in an injury or harm to the plaintiff within the forum State……where the plaintiff is not located within the jurisdiction of the Court, the injurious effect on plaintiff’s business, goodwill or reputation within the forum State as a result of defendant’s website being in the forum State would have to be shown….to show that the injurious effect has been felt by the plaintiff it would have to be shown that viewers in the forum State were specifically targeted…”  The position in Banyan Tree Holding case was also upheld by the High Court of Delhi in Impresario Entertainment and Hospitality Private Limited v. S&D Hospitality [CS(COMM) 111/2017; order dated January 3, 2018].

Recently, in Juggernaut Books Private Limited v. Inkmango Inc. and Ors, [CS (COMM) 421/2019; order dated August 9, 2019], a Single Judge Bench (Pratibha M Singh, J.) of the High Court of Delhi reiterated its judgement in Banyan Tree Holding case and held “…Defendants have deliberately availed of the forum, i.e., India and Delhi, their website is fully accessible in Delhi and subscription can be obtained in Delhi, the Delhi High Court has the jurisdiction to hear this matter…”

Conclusion

From the above, it can be noted that the courts have adopted a consistent approach that mere hosting of a website within territorial limits of the forum court does not confer jurisdiction. In order to avail jurisdiction of a particular forum court in online trademark disputes, it is imperative for the plaintiff disputes to show that the defendant directed its activities towards the consumers within such forum court, thus purposefully availing itself of the jurisdiction of the forum court.

References –              

1.      Banyan Tree Holding (P) Limited vs A. Murali Krishna Reddy & Anr [CS (OS) No.894/2008].

2.      Impresario Entertainment and Hospitality Private Limited v. S&D Hospitality [CS(COMM) 111/2017].

3.      Juggernaut Books Private Limited v. Inkmango Inc. and Ors, [CS (COMM) 421/2019].

Disclaimer: Views, opinions, interpretations are solely those of the author, not of the firm (ALG India Law Offices LLP) nor reflective thereof. Author submissions are not checked for plagiarism or any other aspect before being posted.

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