All You Need To Know About The Assignment Of Design Rights

Introduction

Industrial design

Industrial designs are part of the aesthetic sector, but they’re also meant to be used as a blueprint for the production of industrial or handcrafted goods. The ornamental or aesthetic part of a practical object that must appeal to the sense of sight and may consist of the shape, pattern, and/or colour of the article is known as industrial design. To be protected, an industrial design must be new and original. For a period of five, ten, or fifteen years, industrial designs are protected against unlawful duplication or replication.

According to Section 2(d) of the Designs Act, 2000, design refers to “only the features of shape, configuration, pattern or ornament or composition of lines or color or a combination thereof applied to any article, whether two dimensional or three dimensional or in both forms, by any industrial process or means, whether manual, mechanical or chemical, separate or combined, which in the finished article appeal to and are judged solely by the eye,” but it excludes “any mode or principle or construction”, as defined in clause (v) of sub-section of Section 2 of the Trade and Merchandise Marks Act, 1958, property mark or artistic works as defined under Section 2(c) of the Copyright Act, 1957.

Assignment of Design rights

Assignment is a legal phrase that refers to the transfer of rights, property, or other benefits from one person to another (the “assignor”). Both contract and property law make use of this term. The term can relate to either the act of transferring or the transferred rights/property/benefits.

Section 30 of the Design Act of 2000( Hereinafter referred to as “Act”), as amended by Rules 32, 33, 34, and 35 of the Design Rules of 2001, recognizes design assignment contracts and establishes a method for their recording. Section 30(1) of the Design Act provides that if a person acquires the copyright in a registered design through assignments, transmission, or other legal means, he may apply to the Controller in the specified form to register his title. According to Section 30(3) of the Design Act of 2000, an assignment must be in writing, and the agreement between the parties must be reduced to the form of an instrument embodying all of the terms and conditions governing their rights and obligations, and the application for registration of title under such instrument must be filed in the prescribed manner with the Controller within the stipulated time-that is, within six months of the execution date. The person registered as the proprietor of the design has the absolute right to assign the design rights, according to Section 30(4) of the Design Act of 2000.

Only if the design’s Copyright is statutorily recognised under the requirements of the Designs Act, 2000, is it protected. Similarly, third-party rights obtained through assignments or licences are only effective if they are properly registered in accordance with the Act’s requirements and the Rules enacted thereunder. Under design law, there is no concept of a common law licence.

Assignment of the Semiconductor Integrated Circuits Layout Design

An electronic circuit made on the surface of semiconductor material is known as a semiconductor integrated circuit. Integrated circuits have transformed the field of electronics by being employed in practically all electronic devices currently in use. The sheer quantity of electronic appliances we use on a daily basis demonstrates the significance of semiconductor integrated circuits or chips in today’s environment.

The layout or arrangement of the chip determines its ability to perform a specific function. As a result, a second enactment was required to protect the chip designer’s investment. In India, the Semiconductor Integrated Circuits Layouts Design Act of 2000 would provide this protection.This was done in accordance with India’s commitments under the TRIPS Agreement.

‘An assignment in writing by act of the parties concerned,’ according to Section 2(b) of the Semiconductor Integrated Circuits Layout-Design Act, 2000. According to Section 19 of the Act, the registration of the design, as well as all subsequent assignments, will serve as prima facie evidence of its validity.

Assignments and Transmissions are covered in Chapter V of the Semiconductor Integrated Circuits Layouts Design Act, 2000. Section 20 of the Semiconductor Integrated Circuits Layouts Design Act of 2000 gives the owner of a layout design the authority to assign the layout design and to issue effective receipts for any money received in exchange for the assignment.This is subject to the provisions of the aforementioned Act, as well as any rights that appear to be vested in another person based on the register. A registered layout-design is assignable and transmissible with or without the goodwill of the business involved under Section 21 of the Semiconductor Integrated Circuits Layouts Design Act, 2000.According to Section 22 of the Semiconductor Integrated Circuits Layouts Design Act, 2000, when an integrated circuit layout is assigned without goodwill, the assignment will not take effect unless the assignee applies to the Registrar for directions with respect to the assignment not later than six months from the date on which the assignment is made or within such extended period, if any, not exceeding three months in the aggregate, as the Registrar may allow. The assignee must register the title with the registrar, according to Section 23 of the Semiconductor Integrated Circuits Layouts Design Act, 2000.If the matter is still before the registrar or an appeal from an order therefrom is pending, Section 24 of the Semiconductor Integrated Circuits Layouts Design Act, 2000 prohibits the assignee from utilizing the registration as proof of title.

These rights can be assigned with the help of Assignment Agreements

Assignment agreements deal with the transfer of intellectual property rights from one person or organisation to another. An Intellectual Property Agreement (IP Agreement) or an Intellectual Property Assignment Agreement is a documented and enforceable contract that completes and formalizes a purchase and sale of intellectual property rights between two organisations. Copyrights, trademarks, and/or patents are examples of intellectual property that can be purchased.  Assignment agreements differ from licence agreements in that an assignment agreement transfers ownership of intellectual property from the assignor to the assignee, whereas a licence agreement merely allows the licensee to use the intellectual property for a certain time.

An assignment agreement cannot be compared to a negotiating document since in a negotiation, the transferee may obtain a superior title than the transferor, which cannot occur in an assignment/transfer.

An assignment agreement may include a complete and exclusive sale of the rights, granting the assignee complete ownership of the intellectual property rights to exploit them in any way, shape, or form it sees fit, subject to any constraints set forth in the agreement. These contracts are governed in India under the Indian Contract Act of 1872 and the Indian Stamp Act of 1899.

Process of Assignment under Designs Act, 2000

  • After a design is registered, an application for ownership under Rule 33 of the Design Rules, 2001 must be made to the Controller for the registration of title in the new owner’s name.
  • The agreement of assignment must be written, and all of the parties’ concerns should be provided in the form of the instrument comprising all of the terms and conditions, according to Rule 37 of the Design Rules.
  • After all requirements have been completed and the assignment of rights has been registered with the register of designs, the assignment of rights will be enforceable from that date.
  • Within six months of the instrument’s implementation date, a title registration application must be submitted. This period can be extended for an additional six months.

Conclusion

The Design Act of 2000 and the Copyright Act of 1957 protect the rights of the original designer and deal with the transfer of rights to succeeding owners. The Assignment Agreement assists two parties in transferring intellectual property rights to one another for product development and commercial purposes. Section 30 of the Design Act and Rules 32-35 of the Design Rules, 2001 deal with design assignment agreements. If they are not carefully written as required by law, these assignment agreements give birth to legal and equitable rights in law and raise a slew of concerns.As a result, it’s a good idea to include Assignment Agreement terms that handle concerns like governing law, jurisdiction, and Alternative Dispute Resolution to ensure that disagreements are resolved quickly. It is a legally binding agreement that must adhere to all applicable laws. The enforceability of assignment agreements encourages these individuals to develop innovative technologies that benefit society in the long run. In addition to adhering to these Rules, it is critical to ensure that the agreement properly identifies who owns what. The task must be specific, as well as the duration for which the individual will be the owner of the intellectual property.This would serve as a safeguard in the event of a potential dispute over the Design’s ownership.

Author: Anuja Saraswat – a student of  B.A.LL.B (Hons.) from NMIMS Kirit P. Mehta School of Law (Mumbai), in case of any queries please contact/write back to us via email vidushi@khuranaandkhurana.com or contact us at Khurana & Khurana, Advocates and IP Attorneys.

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