Micromax is the protagonist and OnePlus is the antagonist. And with due apology to Cyanogen: it is the villain

says the Delhi High Court in its last judgment before Winter Vacation.

Delhi High Court vacates the injunction against OnePlus

Just before the Court’s winter recess, the Division Bench of the Delhi High Court vacated the ad-interim injunction against sale of OnePlus One mobile phones in India, which we had reported a while back. The primary reason being, that the case was disposed-off in a hurry and under pressure and that the procedure which includes filing of pleadings, i.e. the plaint and the counter-statement , was not complied with as prescribed under the law. To put it simply, the Division Bench opined that OnePlus was not given a fair opportunity for being heard.

Court’s analysis of the case

Having said that, the order was not vacated merely on technical grounds; the Bench also touched upon certain legal issues and opined that the Single Bench Judge who passed the impugned order ought to have dealt with these in greater depth. Some of the issues as mentioned are as the follows;

  1. What are the rights conferred upon Micromax by Cyanogen under the agreement dated September 26, 2014?

The court said that unless there is clarity on this issue, it cannot be determined if there has been an infringement of rights of Micromax or not.

  1. What are the rights created in favour of OnePlus under the two agreements which it entered into in February, 2014 with Cyanogen?
  2. Does a conflict then arise? If it does, the question that will then arise is, till the period of validity of the two agreements between Cyanogen and OnePlus, could Cyanogen confer an exclusive right to operate in India in favour of Micromax?

For this issue, the Court opined that the principle of law that “no person can convey a title better than his to somebody else” would be attracted. The Court explained it in the following words;

If the owner of a property permits limited use of his property for a duration of time to a second party, upon transferring the ownership in the property to a third party, the limited right limited to the period of the use of the property in favour of the second party would operate as a clog on the ownership of the third party.

  1. The Court also held that issues on facts, like money spent by OnePlus toward marketing, the differences in the personalized features, intuitive interface, speed, enhanced security and several other features etc., should also be taken into consideration.

There was another interesting point raised by this Bench on issue of maintainability of deciding issues that arises from the agreement between Cyanogen and OnePlus. This Bench held that while the appropriate Court to resolve issues between Cyanogen and OnePlus would be the Courts of Northern District of California, however, while deciding a contractual obligation between A and B, this Court cannot compel either party to be in breach of its agreement with C. This has been opined by the Court clearly on the basis of logic. In order to determine the rights conferred to Micromax by Cyanogen, it should first be made clear as to what are the rights OnePlus has been conferred by Cyanogen.

One of the other main issues dealt by the Court was whether a strong case for an ex-parte injunction was made by Micromax. The Court went on to say that caution needs to be taken in cases of ex-parte injunctions and it should be granted only if the plaintiffs have made a strong prima facie case against the defendant. The Court did not think that Micromax had made a strong case and thus directed the Single-Bench Judge to hear the case afresh in two weeks from December 24, 2014. I’m sure all of us are waiting for that day to come to witness an interesting turn of events as the Court will then look into various legal issues and the very interesting facts of the case!

This article has been authored by Durga Bhatt, an IP Law practitioner.