In my previous post, I stated that the question of jurisdiction could play spoilsport to the entire ANI v. Open AI case. After doing some research and some introspection, it became clear to me that the issue of jurisdiction (one of the four issues framed by the Court) was the most straightforward issue of the lot. The TLDR version to the question is that Delhi HC has jurisdiction to entertain the suit. This post will now explain why that is the case.
CPC, Copyright Act and Jurisdiction:
When it comes to determining jurisdiction in a Copyright dispute, one needs to look into two sections, namely Section 20 of the Civil Procedure Code (CPC) and Section 62 of the Copyright Act. Section 20 of CPC lays down the general rules as to where a suit can be filed. It follows what Eashan Ghosh calls in his book ‘chase the defendants rule’.
A perusal of the section makes it clear why the plaintiff has to chase the defendant(s). Section 20(a) and (b) states that every suit shall be instituted in a Court within whose jurisdiction the defendant(s) resides, carries on business or works for gain. But then Section 20(c) says a suit can also be filed where the cause of action arises, wholly or partly. It is important to note that the place where the cause of action arises does not necessarily need to coincide with where the defendant resides, carries business, or works for gain and thus, if interpreted liberally, dilutes the chase the defendant rule. Finally, the explanation clause creates a legal fiction with regard to the ‘carrying of business’ in the context of a corporation.
Section 62 of the Copyright Act inverts the Chase the Defendant rule and provides for a plaintiff option jurisdiction.
On a quick reading, one is able to notice that the Section looks pretty similar to Section 20 of CPC, with the distinction that it allows the plaintiff to file a suit before a District Court within whose jurisdiction he resides, carries on business or works for gain. Thus, Section 62, contrary to Section 20, inverts the chase the defendant rule and carves out an additional forum to sue, tilting the balance in favour of the plaintiff.
The Supreme Court has provided guidance on how to read both the Sections together. Exphar Sa & Anr vs Eupharma Laboratories Ltd (Exphar) clarified that Section 62 provides additional grounds for a plaintiff to sue over and above the options available under Section 20 of CPC. The Court focused on the word “include” in Section 62(2) and clarified that Section 62 does not oust the application of Section 20 of CPC.
The Parliament as the Court states in Exphar brought in Section 62 to make it easier for individual authors to file copyright infringement suits against alleged infringers, as, without Section 62, they will have to chase the defendant(s) under Section 20. But, as Ritvik noted, this concern at that time was limited to individual authors and not corporations.
Jurisprudence of Jurisdiction:
Jurisdiction in IP disputes has always been a knotty problem, especially in the context of composite suits with multiple causes of action spanning different statutes and the rise of the internet (see here, here, here). But our case is simple, as the issues framed have been limited to the question of infringement in the context of the Copyright Act. Following Exphar and other subsequent rulings that have affirmed the position held in Exphar, ANI can file the suit under Section 20 of CPC or Section 62 of the Copyright Act, as Section 62 provides for an additional forum to sue. Post-Exphar, there has been a slew of judgements, with the Supreme Court’s ruling in Sanjay Dalia being the latest. The HCs post-Dalia have provided conflicting interpretations (see here and here).
The critical case for our purposes is the Delhi HC ruling in Ultra Home vs Purushottam Kumar Chaubey, which concluded that the explanation clause in Section 20 of CPC applied to Section 62 of the Copyright Act. This rewriting of law by judicial interpretation is significant because, as noted earlier, the explanation clause creates a deeming fiction with regard to ‘carries on business’. The first part of the Explanation is very relevant to our purposes. “A corporation shall be deemed to carry on business at its sole or principal office in India”. From what I was able to gather from scouring the internet, ANI Media Pvt Ltd is a registered company with a registered address in New Delhi. Likewise, on their website, the company’s head office or sole office is also located in New Delhi. With this information, it is reasonable to conclude that ANI can easily make jurisdiction under Section 62 of the Copyright. OpenAI’s argument about its serves and its lack of physical presence in India is irrelevant to finding jurisdiction under Section 62.
Even under Section 20 of CPC, Section 20(c) provides for filing the suit where the cause of action arises wholly or in part. As noted earlier in the blog, The Delhi HC in Banyan Tree Holding (P) Limited vs A. Murali Krishna Reddy lays down the purposeful availment test of determining the existence of the cause of action under Section 20(c) in the context of online transactions. Yet ANI does not need to take the Banyan Tree route as it applies only in the context where “Plaintiff is not carrying on business within the jurisdiction of a court, and in the absence of a long-arm statute”. Here, ANI has its sole office in New Delhi. The deeming fiction in the explanation clause provided in Section 20 with regards to ‘carries on business’ applies to Section 62 in toto as per Utra Home. Hence, ANI would be presumed to carry its business at its solo office, thus securing jurisdiction under Section 62 of the Copyright Act with no need to show cause of action wholly or partly arose under Section 20(c) within the Court’s jurisdiction or worry or fret about where the Defendant(s) resides or his servers are located.
I wish to thank Swaraj, Praharsh and Lokesh for the informal discussion on the case that led to this post.