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Eros Technologies and Ayngaran: Refers Dispute to Arbitration
In a significant ruling that clarifies the interplay between copyright law and arbitration, the has held that a dispute can be resolved through arbitration even though the provides a under Section 55. Justice K. Kumaresh Babu, presiding over the matter, referred the parties to arbitration under , after finding that the bound the .
The Chain and the Alleged Infringement
The dispute arose between (the plaintiff) and , , and their director, Kumarasamy Karunamoorthy (the defendants). Eros claimed exclusive rights to certain cinematograph films through a chain of assignments that originated from a Deed of executed by on behalf of its group companies, including the defendants. That deed contained , an providing for dispute resolution in the United Kingdom.
Eros alleged that the defendants, despite having assigned their rights, began exploiting the films on various social media platforms—including uploading, streaming, and monetising them—thereby infringing Eros’s copyright and causing of revenue and . Eros sought an to restrain such exploitation.
The Battle Over Jurisdiction: Arbitration vs. Civil Suit
The defendants countered by filing an application under Section 45 of the Arbitration and Conciliation Act, seeking referral of the dispute to arbitration. They argued that Eros, as a from the original , was bound by the in the original deed. They further contended that the availability of a under did not preclude arbitration where the parties had agreed to that mode of dispute resolution.
Eros opposed the referral, arguing that neither it nor the defendants were parties to the , and that a multi-party suit could not be split for arbitration since the other parties—, , , and —had not agreed to the clause. Eros also maintained that a for was not .
Court’s Analysis: and Arbitration Can Coexist
Justice Kumaresh Babu examined the chain of assignments and observed that Eros derived its rights through an in succession from the original granted by . Rejecting Eros’s contention that it was not bound by the , the court noted that the dispute involved alleged infringement by the ’s group companies under an arrangement containing an .
The court held that Section 55’s does not bar arbitration, stating:
“It is true that Section 55 provides for a in an infringement of a copyright. There can be no doubt that the can also be by a process of arbitration, as arbitration is in the form of between the parties, and if agreed between them...”
The court also found no evidence that the was , , or . It reasoned that if the underlying were , Eros’s own claim to the copyrights through successive assignments would fail. Similarly, if the agreement were incapable of performance, the suit for infringement would lack a .
Decision: Parties Referred to Arbitration, Injunction Dismissed
Allowing the defendants’ application, the court referred the parties to arbitration under Section 45 of the Arbitration and Conciliation Act. Consequently, the injunction application filed by Eros was dismissed, and the registry was directed to strike off and return the plaint. No costs were imposed.
The ruling underscores that a copyright owner cannot avoid a valid by relying on the statutory remedy under the . It reinforces the principle that arbitration, as a form of , is available for intellectual property disputes when the parties have so agreed.
