Delhi HC awards Rs 30 lakh as damages to Microsoft Corporation, Adobe Systems in software piracy suit

The Delhi High Court has awarded Rs 30 lakh as damages to Microsoft Corporation, Adobe Systems and Quest Software in connection with a suit against a Nehru Place company for using their pirated software. (Microsoft vs S Gaur).The order was passed by a Single Judge bench of Justice V Kameswar Rao..Microsoft Corporation, Adobe Systems and Quest Software (Plaintiffs) had moved the High Court against the Defendant, a company named ‘Chetu’ which provided IT services and solutions to its clients, and its related parties, after it came to its knowledge that the Defendant was using unlicensed/pirated software programs of the Plaintiffs on its computers..To determine the sphere of activities of the Defendant company and its related parties, the Plaintiffs hired independent investigators..The Plaintiffs claimed that during the course of the investigation, it was confirmed that many employees at Chetu worked on software programs such as Adobe Illustrator, Adobe Flash, Adobe Photoshop, Adobe CS3 and Adobe Reader etc and approximately 200 computer systems were in use with pirated Microsoft Windows Operating System and other software programs. .The Plaintiffs subsequently conducted a license check within their database which revealed that there were no substantial licenses purchased in the name of the Defendant or its related parties..Before the High Court, the Plaintiffs argued that the corporate or end-user piracy was the most damaging form of the software piracy which occurred when businesses, corporations, companies, institutions, schools, non-profit organizations, etc., made additional copies of software without authorization..Contending that the reproduction of the Plaintiffs’ software without permission was an infringement of their copyright in their software program, the Plaitniff sought a decree of injunction against the Defendant and others. .The Court noted that in the present case, the Defendant had not only failed to file any evidence on his defence but had also not finished the cross-examination of the Plaintiff’s witness..The Court also took on record the reports by the Local Commissioner, which revealed that on first inspection, the Defendant could not produce the software license and on the second occasion, licenses were produced for some computers but without invoices..While settling the preliminary issue of jurisdiction, the Court observed that the dispute was not between a specific Plaintiff and the Defendant so as to attract the exclusive jurisdiction clause in the license agreement. “..in this suit, the dispute is between the plaintiffs and the defendants, the allegations being that the defendants are using unlicensed softwares on their computers.. the unauthorized usage of the software of the plaintiffs is in India and the plaintiff No.2 is based within the territorial jurisdiction of this Court for the plaintiffs to file the present suit in this Court. Further, I find, the registered Office of defendant No.2 is also in Delhi.”, the Court said..The Court further observed that the Local Commissioner’s findings that the defendants used unauthorized/unlicensed versions of Microsoft and Adobe software was not contested by the Defendant. .So, the case as set up by the plaintiffs is established in terms of the reports of the Local Commissioner and it is clear that the defendants including the defendant No.2’s employees have been using unauthorized / unlicensed versions of the plaintiff Nos.1 and 3’s software (Mircosoft and Adobe) by installing them on their various computer systems and using in day to day business activities.Delhi High Court concluded..It also recorded that on one occasion, one of the representatives of the Defendant stated that the Defendant was ready to suffer a decree. However, no authorization in this regard was ever filed on record, the Court added. .In view of the above, the Court restrained the Defendant and its related parties from directly or indirectly using for any pirated/counterfeit/unlicensed software of the Plaintiffs or infringing, in any other manner, or causing or enabling or assisting others to infringe the copyrights of the Plaintiffs. .In the absence of any defence and the magnitude of the violation carried out by the Defendant, the Court further held that the Plaintiffs shall also be entitled to damages. .It ordered, .Accordingly, this Court awards damages to the tune of Rs.30 lakhs in favour of the plaintiffs to be shared equally by all of them and this is, in view of the prayers at (c) and (d) of para 64 of the plaint.Delhi High Court.The Plaintiffs were represented by Advocate Aasish Somasi..Read the Judgement: