IIT Kharagpur faces litigation in U.S. over Technology misuse
IITs are always in news for their brainchild and innovations,
but IIT-Kharagpur is in the lime light for its litigation case filed by a U.S. based
entrepreneur Mandana D Farhang along with her affiliate MA Mobile Limited.
Mandana and MA Mobile have filed a case against IIT Kharagpur (IITKgp) and its affiliate
Technology Incubation and Entrepreneurship Training Society (TIETS) for misuse of
her invention and trade secrets. The case is filed with the Northern District Court
In terms of the court, Plaintiff Mandana D. Farhang filed her complaint on May 27,
2008 and IITKgp was served with summons on April 8 2009. In August 2009, IITK filed
a complaint against Farhang stating that she was using the institute's intellectual
property without their permission with the High Court of Calcutta, India. IITKgp
now moves to stay until the Indian proceedings are concluded and the determination
of the High Court of Calcutta becomes final. Their bases for requesting a stay are
the principles of international comity and international abstention. International
Comity means in U.S. law that that courts should not act in a way that demeans the
jurisdiction, laws, or judicial decisions of another jurisdiction.
In its complaint filed with the High Court at Calcutta, IIT makes the following
- IIT never entered into a valid and enforceable non-disclosure agreement ("NDA")
- IIT expended time, money, and resources into developing the disputed IP.
- Farhang has wrongfully detained and utilized the IP.
It appears that the only action taken by the Indian court thus far has been to issue
a preliminary injunction restraining Farhang from utilizing the disputed intellectual
property ("IP") without IIT's written consent while the Indian action is pending.
Meanwhile, in the instant action, plaintiffs Farhang and M.A. Mobile Ltd. bring
claims against IIT and other defendants for:
- Breach of the NDA.
- Breach of joint venture agreements.
- Breach of fiduciary duty.
- Misappropriation of trade secrets. Even if the Calcutta High court will be in the
favor of IITKgp and dispose of all of plaintiffs' claims, there will still some
issues that the U.S. court has to address.
Also IITKgp states that M.A. Mobile does not have the rights to file the case under
the U.S. court because it has not complied with California Corporations Code Section
2105. Section 2105 requires foreign corporations to obtain a certificate of qualification
from the Secretary of State prior to transacting intrastate business in California.
M.A. Mobile is a foreign corporation chartered under the laws of the Commonwealth
In her complaint to the U.S. court Mandana mentions that in the year 2003, she and
her affiliate had entered into an agreement with the IITKgp on building a prototype
for a specific application for the mobile computing technology that was to be used
in the Indian Railways. Keeping this in mind, Mandana had shared her invention with
IITKgp. She also went ahead and shared the trade secrets with relation to the invention
including the marketing and customer information. Further in the complain states
that IITKgp has misused the information by sharing it with other 3rd parties like
IBM and Indian Railways thus breaching the contract of agreement between them.
Courtesy: Silicon India