Delhi District Court
Ms. Design Worldwide vs M/S Bausch & Lomb India Private Limited on 22 April, 2017
IN THE COURT OF SH AJAY PANDEY ADDL. DISTRICT
JUDGE02: SOUTHWEST DISTRICT: DWARKA
COURTS:NEW DELHI
CS 16781/16
MS. DESIGN WORLDWIDE
a partnership firm through its Partner,
Mr Sanjay Sarma having its Principal place of
business at 704, Tower B, Millennium plaza,
Sushant Lok, Phase I, Gurgaon
Another office at G01, Centre S2, GP 43,
Sector 18, Maruti Industrial Estate,
Gurgaon122015, Haryana .....Plaintiff
Versus
M/s Bausch & Lomb India Private Limited
having its registered office at 4th Floor,
Tower B, Unitech Business Park,
South City1, Gurgaon122001,
Haryana ....Defendant
Date of institution of the suit : 25.3.2011
Date of arguments : 18.04.2017
Date of pronouncement : 22.04.2017
CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.1/21
Suit for recovery of Rs 18,00,000/( Rupees Eighteen Lakhs)
and for rendition of accounts
JUDGMENT
1.This is a suit for recovery of Rs 18 lacs alongwith interest and for rendition of accounts for ascertainment of 15 % agency commission on account of the work allegedly done by plaintiff for the defendant.
2. In nutshell, case of the plaintiff is that it is engaged in the business of advertising,communication and design solutions. Defendant company obtained the services of the plaintiff on project to project basis for several advertising and compaign work for its products. On or about 2.6.2010 defendant verbally briefed the plaintiff on a new compaign for HD lenses . Plaintiff worked for the said compaign. Parties had various communication regarding that compaign through Emails. The plaintiff presented to the defendant, its original creative work CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.2/21 developed for the defendant, which included close up of a butterfly, a peacock feather, a flower and a flying eagle. The work was sent to defendant through email. In first week of December 2010, the plaintiff was shocked to notice the release of the defendants HD campaign in market using the copy right work of the plaintiff without informing it or acknowledging its work. Plaintiff at various places including leading eye care retail stores, noticed that the defendant had released the work through another agency though the same was originally created by the plaintiff, using its resources and creativity. Defendant did so without the permission of the plaintiff which amounts to infringement of the intellectual property rights of the plaintiff. Thereafter, the plaintiff and defendant communicated through emails to resolve the issues but to no avail. Defendant did not even pay the legitimate fee for the creation and development of work by the plaintiff . It is stated that the defendant company always paid for all the earlier assignments /compaigns CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.3/21 undertaken by the plaintiff including the compaigns which were rejected by the defendant. Contrary to their earlier practice this time the defendant company did not pay the plaintiff any amount for this compaign, which was perhaps the biggest compaign the defendant company, offered to the plaintiff. The plaintiff therefore issued a legal notice dated 22.2.2011 to the defendant demanding payment of Rs 18 lacs towards the fee of the aforesaid compaign and calling upon the defendant to render the accounts detail to ascertain 15% agency commission towards all media expenditure incurred by the defendant using the said creative compaign. Defendant sent a reply dated 2.3.2011 to the notice of the plaintiff but did not comply the notice. Hence the suit.
3. After service of summons, defendant filed its written statement taking preliminary objections that the suit is filed with malafide intention to extort money and that the same is without cause of action and that there is no basis of the plaintiff's claim for recovery of alleged CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.4/21 dues of Rs 18 lacs or claim of interest or for rendition of accounts. It is further stated that there was no agreement between the plaintiff and the defendant for entitling the plaintiff to the alleged amount or agency commission, therefore, the defendant is under no obligation to pay anything to the plaintiff. It is further stated that defendant is the owner of distinguished artistic work used by it in its Advertisement compaign and has not violated any intellectual property right of the plaintiff. Objections qua territorial jurisdiction of this court and non joinder of necessary parties was also taken.
4. In preliminary submissions of the written statement it is stated that plaintiff contacted the defendant in the year 2008 for providing service of brand compaign and developing design for such compaign. At that time defendant stated to plaintiff that the defendant had year to year contract with M/s Draft FCB Ulka Advertising Private Limited and do not intend to enter into other parallel advertising contract with another CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.5/21 agency. The plaintiff agreed to be an on and off engagement partner without signing any agreement and without charging any pitching cost. The defendant was free to work with the plaintiff if the plaintiff's idea matched with the parameters of the defendant's brief . On these lines, the defendant hired the services of plaintiff for some projects without any contractual arrangements. In the end of year 2009 defendant met with the plaintiff for launch of High Definition lenses in India . In June, 2010 verbal brief of the requirements of defendant was issued to the plaintiff. Plaintiff reverted with a recommendation, which did not match with the brief of the defendant. Thereafter the defendant conveyed its decision to not to proceed with the said recommendation of the plaintiff. In October, 2010 defendant met the advertisement agency M/s Draft FCB Ulka Advertising Private Limited with the brief of its requirement for advertisement compaign. The agency prepared various artistic design work. Defendant selected one design, for which defendant CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.6/21 paid considerable amount to the advertisement agency and therefore become owner of the said artistic work. The plaintiff is wrongly claiming the proprietory rights on the said artistic work. The emails of the plaintiff alleging that the defendant's said artistic work is adaptation of the plaintiff's alleged creative idea were replied by the defendant making it clear that the artistic work used by defendant was completely developed by another advertising agency for the defendant. The contents of Legal notice dated 22.2.2011 are stated to be wrong misleading and false. It is stated that the plaintiff filed this false suit with malafide intention to extort money from the defendant.
5. In reply on merits similar defence is extended and it is stated that defendant is the owner of the original work used by it in the advertisement compaign of its HD lens. Any adaption of the plaintiff's work in developing the advertisement of the defendant is denied . It is reiterated that the presentation / work of the plaintiff did not match with the defendant's brief and so the CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.7/21 defendant decided not to proceed the advertisement compaign with the plaintiff's alleged presentation / work , hence the question of compensating the plaintiff for rejected work does not arise. Plaintiff is again stated to be not entitled to any agency commission under the contract or under any rules of advertising agency. Dismissal of the suit is prayed.
6. Plaintiff filed replication to the written statement, reiterating the facts stated in the plaint and denying contrary allegations of the written statement.
7. On 15.09.2011, from the pleadings of the parties, following issues were framed by my Learned Predecessor: ISSUES
i)Whether the suit of the plaintiff is bad for nonjoinder of necessary parties, if so its effect? ...OPD
ii) Whether the defendant has infringed the plaintiff's copy right, if so its effect? ...OPP
iii) Whether the plaintiff is entitled to a sum of Rs 18,00,000/ as prayed for? ...OPP CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.8/21
iv)Whether the plaintiff is entitled to any interest on such amount, if yes, at what rate and for what period? ...OPP
v) Whether the plaintiff is entitled to the rendition of account as prayed for ? ..OPP
vi) Relief.
8. In support of his claim, plaintiff examined Sh Sanjay Sharma, Partner of plaintiff as PW1 and one Sh Dhrubo J Borkotoky as PW2.
9. Defendant examined Sh Yashwant Singh Rawat, Manager Company affairs as DW1.
10. Both the parties filed their respective written synopsis.
11. Detailed oral arguments were also heard.
12. With the assistance of learned counsel for parties, the court has also gone through the evidence and documents relied upon by them.
13. Record perused, arguments considered.
14. Issuewise finding of the court is as follows: ISSUE NO.1 Whether the suit of the plaintiff is bad for non CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.9/21 joinder of necessary parties, if so its effect? ...OPD
15. Onus to prove this issue was upon defendant, it is submitted by learned Sh Ranjeev Kumar, advocate for defendant that the prior to the filing of the present suit, plaintiff was well aware that the defendant engaged M/s Draft FCB Ulka Advertising Private Limited for development and creation of the work. Despite that the plaintiff did not make the said advertisement agency as a party in the suit.
16. Court is in agreement with the submission of Learned Sh Jasmeet Singh that there is no privity of contract between plaintiff and M/s Draft FCB Ulka Advertising Private Limited. The plaintiff has confined his entire claim against the defendant. Said advertising agency is therefore, not a necessary party to the suit . This issue is accordingly decided in favour of plaintiff. ISSUE NO.2 Whether the defendant has infringed the plaintiff's copy right, if so its effect? ...OPP
17. Onus to prove this issue was upon plaintiff. Learned CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.10/21 Sh Jasmeet submits that the plaintiff developed original artistic work for the advertisement compaign of defendant. Defendant did not make any payment towards the development or for the adaptation of the said work, therefore, the copy right and ownership of the said work always remained with the plaintiff. He further submits that the work developed by the plaintiff is shown in Ex PW1/5. The publicity advertisement or work used by the defendant is Ex PW1/8. He submits that a bare perusal of both the work would reflect that in Ex PW1/8 defendant had adapted the work of the plaintiff in Ex PW1/5. He therefore submit that the defendant committed infringement of the plainttiff's copy right over Ex PW1/5.
18. It is rightly submitted by Sh Ranjeev Kumar that the plaintiff cannot blow hot and cold in the same breath. On the one hand plaintiff is claiming remuneration or the price of the development of alleged work Ex PW1/5 for defendant, on the other hand he is claiming the ownership / title over the said work.
CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.11/21
19. It is rightly submitted by counsel for defendant that in case the work was developed or performed by the plaintiff for consideration in favour of defendant, defendant becomes the owner of the work. Without admitting that the work was ever purchased by the defendant, he submits that the suit of the plaintiff , at the most can be treated as a suit for price of the work, done or developed for the defendant. In such case , plaintiff would be left either to claim the work or to claim the price thereof.
20. Once the plaintiff has sued the defendant for the price of work, in the opinion of court the plaintiff is not left with the title or ownership of the work.
21. Therefore, in the opinion of this court, even if the work, price of which is claimed in the present suit, was adapted or further developed by the defendant for the use of its advertisement compaign, no infringement of the copy right of the plaintiff was committed.
22. Otherwise also Ex PW1/5 contains 18 pages including a large number of images and written CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.12/21 material. Ex PW1/8 is containing only a few images. On the face of it it cannot be said that the Ex PW1/8 copied some contents from Ex PW1/5. There is no expert opinion on the aspect that the Ex PW1/8 has been developed on adaption of, or on the basis of Ex PW1/5.
23. Hence, this issue is decided against the plaintiff.
ISSUE NO.3
iii) Whether the plaintiff is entitled to a sum of Rs 18,00,000/ as prayed for? ...OPP
24. Onus to prove this issue was again on plaintiff.
25. In its written statement defendant has admitted that in the year, 2009 he met with the plaintiff for launch of HD lenses. In June, 2010 defendant gave verbal brief to the plaintiff for its requirement for advertisement of HD Lenses in India. Plaintiff reverted with some recommendation , using a specially created film to highlight the HD lens benefit which required TVs/displays to be installed in retail shops as well as shooting of a costly TV film. These recommendation CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.13/21 did not match with the brief of the defendant. Therefore, the defendant did not proceed with the said recommendation of the plaintiff.
26. It is, therefore, admitted that the defendant did issue the brief of its work requirement to plaintiff. Plaintiff did develop the work for the defendant. The only plea of the defendant is that he is not liable to make payment because the work was never approved or the work was rejected or the work did not suit the requirement of the defendant and therefore, neither the plaintiff raised any invoice or estimate nor defendant issued any purchase order nor the defendant was supposed to make any payment.
27. Court is in agreement with the submissions of learned Sh Jasmeet Singh that there is no dispute qua the price of work, raised by the defendant either in its pleadings or in the evidence. There is no cross examination of the witness of plaintiff that the quantum or the remuneration for work or the price of the work is excessive or that the actual price or market price of the CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.14/21 work is other than the amount as claimed by the plaintiff. There is nothing that as per the agreement between the parties, some amount other than as claimed in the plaint was payable.
28. In his plaint, plaintiff has categorically stated that defendant had paid the plaintiff even for the rejected work. At page 3 of his cross examination recorded on 4.2.2013, DW1 stated that "It is correct that the defendant company has paid to the plaintiff firm for all the compaign carried on for the defendant company including the rejected campaign except the one in dispute in this matter."
29. Counsel for defendant submits that the rejected work , referred to by the plaintiff or DW1 , payment of which was made by the defendant, was the work, which was approved by the defendant, for which estimate is raised by the plaintiff, but which was not ultimately used in the advertisement compaign.
30. The court do not find much weight in the submissions of the learned counsel for defendant. Once, the plaintiff CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.15/21 had prepared the work for the defendant, whether to use it or not in its advertisement compaign is the choice and discretion of the defendant. An ordinary prudent man, by the rejected work, would understand a work or the compaign, which did not suit the defendant, or did not suit the defendant for the time being for any reason whatsoever. Defendant may not use the said work at a particular point of time. Later on the defendant may choose to use the said work. In the case in hand plaintiff has specifically alleged that he sent the material to defendant for downloading. Defendant downloaded the same. Once the material was downloaded by the defendant. Same is still in the custody of defendant and same was never returned to the plaintiff. Hence, the defendant is free to use the same as per his choice.
31. The documents relied upon by the plaintiff reflect that the payments were made by the defendant even for the rejected work. Hence, even if it is presumed that the work of the plaintiff, in the present case was CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.16/21 rejected by the defendant, plaintiff is entitled for remuneration or price of the work. Further, it is rightly submitted by learned counsel for plaintiff that in the present case there is no communication from the defendant , intimating the plaintiff that his work in this case was rejected.
32. Even if the bill was not raised by the plaintiff, the defendant cannot escape his liability for taking the services of the plaintiff, when the plaintiff had already sent or given the work which could have been and can still be utilized by the defendant.
33. In the facts and circumstance this court is of the opinion that plaintiff has successfully proved that he is entitled for recovery of the price of work done by him for the defendant i.e for an amount of Rs 18,00,000/, as prayed in the plaint. This amount shall form principal sum adjudged for recovery.
34. This issue is accordingly decided in favour of plaintiff ISSUE NO. 4 Whether the plaintiff is entitled to any interest on CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.17/21 such amount, if yes, at what rate and for what period? ...OPP
35. It is already held while deciding issue no.3 that the plaintiff was supposed to be paid Rs 18,00,000/ by the defendant towards price of the work performed by him. Defendant withheld the said amount without any justifiable reason. Defendant is therefore, liable to pay interest to the plaintiff on the with held amount.
36. In his suit plaintiff claimed pendentlite and future interest @ 24 % per annum.
37. Considering the prevailing economic scenario, business transactions between the parties, and absence of any contract for payment of interest, this court is of the opinion that interest @ 12 % per annum would be reasonable.
38. This issue is accordingly decided and it is held that plaintiff is entitled for pendentlite and future interest @ 12 % per annum.
ISSUE NO 5 Whether the plaintiff is entitled to the rendition of CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.18/21 account as prayed for ? ..OPP
39. The work assigned to the palintiff had two limbs.
Firstly, the plaintiff was supposed to developed the material for add compaign. Secondly, the plaintiff was to publicize the said material, if approved by the defendant.
40. Both these limbs were independent which is clear from the fact that plaintiff is himself claiming an amount of Rs 18,00,000/ in this suit for developing the material only.
41. It is rightly submitted by learned counsel for the defendant that there are no facts and circumstances brought on record by the plaintiff, which suggest that the defendant was under an obligation to publicize the material through plaintiff only.
42. In his cross examination recorded on 13.03.2012, at page 5 PW1 stated " it is correct that the defendant company sometimes hired the service of the plaintiff firm for creating only design work. It is correct that for the design works undertaken by the plaintiff firm for CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.19/21 which the payments have been made by the defendant company and copyright transferred were published by the defendant company."
43. Once the copy right of the material, purchased by the defendant company from the plaintiff, transferred on to defendant, it is the discretion and choice of the defendant to publicize the same through plaintiff or through some other agency or on his own. In the absence of any contract between the parties, the plaintiff cannot insist the publication of compaign through him only. Hence, the plaintiff cannot lay the claim of 15 % agency commission as prayed in the suit.
44. Once the defendant is not liable to make payment of agency commission to the plaintiff, there is no obligation upon him to render the accounts of the compaign to the plaintiff.
45. This issue is accordingly, decided against the plaintiff.
RELIEF
46. In view of the aforesaid discussion of the court, the CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.20/21 suit of the plaintiff is decreed with cost for recovery of Rs 18,00,000/ ( Rupees Eighteen Lacs only) against the defendant with pendentlite and future interest @ 12 % per annum. Claim for rendition of account is rejected.
47. Decree sheet be prepared accordingly.
48. File be consigned to record room.
Pronounced in the open (Ajay Pandey)
court on 22.04.2017 Addl. District Judge02/SouthWest,
Dwarka Courts Complex, New Delhi
CS 16781/16 DESIGN WORLDWIDE Vs. M/s Bausch & Lomb India Private Limited Page no.21/21