In a civil copyright infringement case, the Delhi high court awarded Rs 19.75 lakh as damages to the leading software seller Microsoft earlier this year.

The court penalised two parties, against whom Microsoft had filed a case, for pirating versions of Windows 98, Office 2000 and Visual Studio 6.0, and illegally distributing it. Piracy and counterfeiting is not uncommon in the technology world. In many markets across the globe, companies constantly wage a battle to flush out counterfeit and pirated products. As the local demand for technology products shoots up, the sales of the spurious stuff escalates.

Executives of technology companies in India say that despite active attempts to curb the distribution of illegal products, fully eradicating the menace is not likely to happen soon. The strong support of the judiciary and other concerned parties like the police, however, is encouraging and helps in sending warning signals to pirates and counterfeiters, they add .

Terming the verdict in their case as a landmark one, Microsoft officials say, "The judgment is a testimony to the increasing need for inculcating respect for intellectual property. It is a significant step in creating extremely healthy precedents in the IPR regime in India."

IT executives are of the view that quick legal action and stringent punishment will deter several potential people and firms from indulging in piracy. Rangu Salgame, country manager India of networking equipment vendor Cisco, says that customers most often tend to buy spurious products due to lack of awareness, though some get attracted by the low price tag that non genuine products don. The Indian legal system fully supports and protects the intellectual property rights of companies and there is considerable support from the judiciary, he says.

In a recent judgment, the Delhi high court passed an injunction refraining a few hardware dealers from selling counterfeit Cisco products. In Cisco's case it was not counterfeit Cisco branded router or switch box that was sold, but add cards that are used in the router. Salgame says that this is an early trace of counterfeited Cisco modules and it is not a pervasive problem for the company. "There is no need to panic. We have taken appropriate steps," he added. The high court ruling in Cisco case will send strong signals to all existing and future counterfeiters, he adds. Many technology companies now have a special team in place to identify and initiate action against pirates and counterfeiters. Cisco, for example, has a brand protection team whose job is to take ongoing, proactive, concerted and company-wide effort to minimise the potential for long-term damage to the Cisco brand as a result of counterfeiting.

Legal professionals such as Pravin Anand of Anand & Anand, advocates, say that the counterfeiting issues have assumed epidemic proportions. The percentage of goods that are spurious varies across industries.

According to Anand, there has been a bunch of actions in which punitive and exemplary damages have been granted by the Delhi High court. These include cases filed by companies like Microsoft, Adidas and Time Magazine. Damages ranging from Rs 15 lakh to Rs 25 lakh have been obtained, he says.

As an example, he says that Nasscom, the trade body for software and services vendor obtained Rs 16 lakh as compensation in a phishing case against a company that was masquerading as Nasscom on the Internet to obtain personal data from professionals for its head hunting activities.

Anand says that slapping a stiff penalty will act as a deterrent. Judges have become extremely alert and in most cases are highly knowledgeable about IP issues. "They have developed a positive approach and attitude to the utility of IP and the time is not far when India would be an IP superpower," he predicts.

Nasscom president Kiran Karnik says that it is encouraging to note that the Indian judiciary takes note of the problem and is initiating appropriate action. Nasscom is working on a regular basis to train the police and the judiciary in enforcing IPR laws, and is also conducting numerous anti-piracy raids and other campaigns across the country.

A recent BSA-IDC study says that a reduction in piracy from the 70% level in 2002 to 60% by 2006 will add $2 billion to India's economy, increase local industry revenues by around $1.6 billion, generate 48,435 new high-tech, high-wage jobs and generate $92.4 million in tax revenues for the government.