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2017 Supreme(Mad) 3997

IN THE HIGH COURT OF JUDICATURE AT MADRAS
M.M. SUNDRESH, J.
Trivitron Healthcare Pvt. Ltd. – Applicant
Versus
Shivram Iyer and Others – Respondents
O.A. Nos. 1192 to 1196 of 2015 in C.S. No. 896 of 2015
Decided On : 10-04-2017

Advocates Appeared:
For the Applicant : Anirudh Krishnan.
For the Respondent: Satish Parasaran for P. Giridharan.

Headnote:

Indian Contract Act, 1872 – Section 27 – Copy Right Protection – Permanent Injunction – Pending the suit for declaration, permanent injunction and mandatory injunction to protect the copy right, trade secret and to prevent the confidential information, these applications have been filed seeking an order of interim injunction – Held, Court cannot grant an injunction which will have an effect of creating such a contract as it is well open to an intending buyer to lay its hand on a product which it finds better in quality and to its liking – Decisions relied upon by the learned counsel for the plaintiff are not cases in point to be applied in its favour, though they speak about the general law governing the subject. Much reliance has been made on the decision rendered in Hi-Tech Systems and Services Ltd. vs. Suprabhat Ray and Others, (2015) SCC On Line Cal. 1192 – Said decision has to be seen in its own context. – A finding has been rendered to the effect that during the currency of the employment confidential information has been leaked. – Reliance has also been made on the Circular issued by the plaintiff by E-mail, which is prior to the resignation of the employees, showing correspondence with the third party – Counsel has made a fervent appeal on equity. – It is settled that between law and equity, law has to prevail. – Though they can travel on the same channel, there water do not mix always. – Court also does not find any equity in favour of the plaintiff for the reasons aforesaid. – Fifth defendant has already started its manufacturing and its products have come into market with the higher price tag. – Hence, the contentions raised are rejected. – Applications Dismissed.

JUDGMENT :

M.M. SUNDRESH, J.

1. Pending the suit for declaration, permanent injunction and mandatory injunction to protect the copy right, trade secret and to prevent the confidential information, these applications have been filed seeking an order of interim injunction.

2. BRIEF FACTS:-

2.1 M/s Kiran Medical Systems Limited was involved in manufacturing of Imaging products and Radiation Protection Apparels (waist). The customers are hospitals and clinics. The waist manufactured are to be used for taking x-rays and those meant for protection to those involved in the said jobs. The specifications are mandatory to be complied with.

2.2 On 14.07.2011, a Share Purchase Agreement was entered into between the plaintiff and the erstwhile Kiran Medical Systems Limited for a stage wise purchase of the shares from all the latter spread over a period of three years. Till the take over by the plaintiff, entire business was to be managed from Mumbai. A merger has taken place vide order of this Court dated 28.04.2015 in favour of the plaintiff.

2.3 The first defendant was the Chief Operational Officer of the plaintiff. The second defendant was the Vice President of the manufacturing unit. The third defendant worked as a General Manager-Production and the fourth defendant was the Vice Person-Sales. After taking over, the management shifted to Chennai. Though the plaintiff claims the existence of a confidentiality and non disclosure agreement said to have been executed by the fourth defendant, the averments would indicate that they are not available. Needless to state that the defendants denied the said factum of execution. The first defendant sent his resignation in the month of January 15th and relieved on 31.03.2015. All along he was working at Mumbai. Thereafter, he joined fifth defendant, who is a competitor in business through the plaintiff on 27.07.2015. The second defendant gave a resignation letter during the first week of February, 2015 and relieved on 28.02.2015. The third defendant, after his resignation on 30.06.2014, joined the services of the fifth defendant on 05.07.2014. The fourth defendant relieved on 24.11.2014. One of the defendants has also subsequently resigned from the fifth defendant. Defendants 2 to 4 have never visited Chennai office. In fact, according to them, the said office was not in existence during their employment. The first defendant has stated to have visited Chennai office only on two occasions. One at the time of the plaintiff took over the charge and secondly, at the time of giving his resignation. The plaintiff found that the fifth defendant was in possession of all the trade secret and copy right belonging to them and started manufacturing waists. An internal audit was made and in the auditing, one of the files available in Chennai said to have been created on 03.03.2015, in which it was found that defendants 1 to 4 in connivance of each other, started sharing the confidential information relating to the trade secrets exclusively belonging to the plaintiff, which has been used in favour of the fifth defendant. It is the further case of the plaintiff that the confidential information has been used in favour of the fifth defendant by defendants 1 to 4. Thus, the suit is laid for the protection of copy right and trade dress.

2.4 Factually, the fifth defendant has started its production. The cost of the product of the fifth defendant is higher than the plaintiff.

3. Submissions of the learned counsel:-

3.1 The learned counsel appearing for the applicant/plaintiff submits that the information as available in the folder by name “pen drive” constitute a trade dress. It also comes within the purview of a copy right. The plaintiff complied with the mandate of Section 65-B of the Indian Evidence Act, 1872. On fact, there is no dispute that defendants 1 to 4 were the employees of the plaintiff. It is also not in dispute that all of them resigned and joined the fifth defendant. The manufacturing process would involve cert









































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