The judgment establishes the principle of awarding compensatory and exemplary/punitive damages in cases of copyright infringement and trademark violation to compensate the plaintiff for losses and deter wrongdoers from engaging in unlawful activities.

A.K. Sikri, J.

1. The plaintiff, Microsoft Corporation, is a company organized and existing under the laws of the State of Washington, USA. It has, however, its presence all over the world. In New Delhi it has marketing subsidiary Microsoft India Pvt. Ltd. The plaintiff is a world famous name for its business software such as Microsoft Windows, Microsoft Office etc. which are installed and used on millions of computers all over the world, including India. It also manufactures a large range of computer peripherals (hardware). The hardware group was established in 1982 and during this period, the plaintiff has built its reputation for technological expertise in hardware by developing and launching a series of successful devices including the ergonomically designed Mouse and Keyboard. It is stated that software developed and marketed by the plaintiff is "computer programme" within the meaning of Section 2 (ffc) of the Copyright Act, 1959 (hereinafter referred to as the Act) and included in the definition of a literary work as per Section 2(o) of the said Act. The plaintiffs computer programmes are "works" that were first published in the USA and are also registered in the USA. These programmes have been created by the employees of the plaintiff, for the plaintiff. Under the US Copyright Law, US Code Title 17, Section 201(b), the copyright in a work created by an employee belongs to the employer under the Work made for Hire doctrine. Both, the computer programme, as well as the supplementary User Instructions and Manuals, are original literary works as contemplated under Section 2(o) and Section 13(1)(a) of the Act. The plaintiff is the owner of the said copyright. A complete list of the software programme owned by the plaintiff is filed with the plaint. The rights of authors of member countries of the Berne and Universal Copyright Conventions are protected under Indian copyright law. India and the USA are signatories to both the Universal Copyright Convention as well as the Berne Convention. Plaintiffs works are created by authors of member countries and originate from and are first published in the said member countries. Plaintiffs works are, thus, protected in India under Section 40 of the Act read with the International Copyright Order, 1999. The case of the plaintiff is that the plaintiff being the owner of the copyright in the aforesaid literary works within the meaning of Section 17 of the Act is entitled to all exclusive rights flowing from such ownership as set out in Section 14 of the Act.

2. It is stated that the plaintiff suffers incalculable damage to its intellectual property rights and business on account of various forms of copyright piracy. The common methods of copyright infringement employed in relation to computer software are described in brief as below:

reproducing the plaintiffs software and the packaging of that software,

so that purchasers are deliberately misled into believing that the product

they are buying is genuine software.

reproducing or "burning" the plaintiffs software onto a blank CD, where no attempt is made to represent that the copy is genuine.

reproducing a number of the plaintiffs programmes on a single CD-ROM, known as a "compilation" CD.

3. Another form of piracy that is assuming great significance in the information age is that of Internet piracy. Internet piracy occurs when software is downloaded from the Internet or distributed via the Internet without the permission of the copyright owner. Common Internet sites used for this infringing activity include online classified advertisements, Auction Houses, newsgroups, personal web sites and Bulletin Board Service (BBS) sites.

4. The plaintiff also enjoys the ownership in the trade mark Microsoft which was adopted in the year 1970 and the plaintiff has used this trade mark continuously and extensively. Microsoft is not only used as trade mark but also as a prominent/key and leading portion of its corporate name. This trademark i