Data theft, pilferage of confidential information, unauthorisedly whisking away important documents in soft or hard format, proprietary drafts and memos being emailed to personal IDs etc. are all very real problems and taking place in organisations everywhere. Those working in Human Resource Departments of companies will be all too aware of drafting charge sheets, warning memos and even termination letters based on theft of the organisation’s confidential information and intellectual property. However, the alarming thing about IP theft by employees is that it is persistent and no amount of deterrence seems to be acting as an iron fist against it.
In Recent news, an employee of Wockhardt transferred confidential company information using her company email account to her personal email account before quitting her job (Wockhardt Hospitals Limited vs. Supriya Pawar, Suit No. (L) 160 of 2014, before the Hon’ble Bombay High Court). She had even forwarded such information to her husband’s email ID. The Hon’ble Bombay High Court, recognizing the urgency of the situation, on 27 February 2014, granted interim injunction against the Defendant or any other person to whom the Defendant is or may be rendering any services, either in the healthcare, hospital business or any other allied business, restraining them from in any manner whatsoever, infringing the copyright of the Company in the original literary work, being the confidential and/or proprietary information of the Company.
Section 2(o) of the Copyright Act, 1957 defines a literary work to include programs, databases and compilations including a computer database, while Section 13(1) (a) defines an original literary work. Section 17(c) refers to the first owner of the Copyright and in case of an author’s employment it is the employer who the first owner of the copyright is. The said provision of the said Act reads as under:
17(c); In the case of a work made in the course of the author’s employment under a contract of service or apprenticeship, to which clause (a) or clause (b) does not apply, the employer shall, in the absence of any agreement to the contrary, be the first owner of the copyright therein;
In the matter of Mr. Diljeet Titus, Advocate Vs. Mr. Alfred A. Adebare and Ors. [2006(32) PTC 609(Del)], the Plaintiff had a brought a suit upon the Defendants, associates who had allegedly left the Plaintiff’s law firm carrying with them the list of clients, proprietary drafts etc. The Hon’ble Bombay High Court held that Copyright protection existed not only in what was drafted or created but also in list of clients and respective addresses. The Court ordered the Defendants to be restrained either through themselves or their representative from utilizing the material of the plaintiff forming subject matter of the suit and from disseminating or otherwise exploiting the same including the data for their own benefit.
The importance, therefore, to have clearly demarcated IP rights or a predetermined pattern of sharing the same cannot be emphasized enough. In partnership agreements, appointment agreements etc. it is imperative to have well defined Intellectual Property and non-disclosure of confidential information clauses. In agreements with freelancers or service providers it is important to mention that all the inventions or creations resulting from the association shall belong to the appointing company. Also, an organization must have in place strong information security measures to protect their IP from being pilfered. Read our Article here on how to adopt information security measures to protect your company’s IP and confidential information.