By Diksha Singh and Nitika Sinha
The on-going Russian- Ukraine conflict has been termed as the largest attack on a European state since the World War II. Many governments have slapped heavy sanctions on Russia to indicate their stand against the war of aggression, ranging from prohibitions on luxury items, travel bans, gas imports etc., with several companies even suspending their operations in Russia, such as Apple, Toyota etc.
In response to the sanctions, Russia has issued Decree No. 299 on March 06, 2022, which allows for the seizure of IP rights, and is justifying the same under the Russian Civil Code, which permits lifting of third party’s IP rights without the consent of the right holder in situations of extreme necessity, in return for proportional compensation. However, this compensation amount is 0%, for companies and/or persons of a hostile and/or in other words, ‘unfriendly’ country. This means that a patented invention in Russia, which is owned by a so-called unfriendly foreign entity, can be used in the Russian territory without any authorization or compensation being given to the owner of the patent. Therefore, the said decree makes it impossible to sue infringers of IP rights before the Russian Courts.
As of now, the list of ‘unfriendly countries’ issued by Russia, includes United States and UK, while India is not a part of the said list. Further, Russia has even proposed re-opening ‘RuTracker’, a famous torrent site that was earlier blocked in Russia, in order to help residents of Russia to watch foreign films and shows, after many studios worldwide refused to release new films and shows in Russia.
Recently, in support of Russia’s retaliatory actions, a Russian judge, Mr. Andrei Slavinsky, of a provincial arbitration court has passed a rather unconventional ruling that allows infringement of the copyright existing in the famous pig cartoon, ‘Peppa Pig’, in view of the sanctions against Russia by US and UK. This means that the Peppa Pig cartoon characters can be blatantly copied by any business across Russia without any apprehension of being hit by an infringement lawsuit.
The background of the case goes back to September, 2021, when the UK based company, One Entertainment (acquired by American toy giant, Hasbro in 2019), the company behind the cartoon series ‘Peppa Pig’, filed a copyright infringement case against a Russian entrepreneur, Ivan Kozhevnikov, after he had created his own versions of ‘Peppa Pig’. Under different circumstances, the case would have been a simple open-and-shut case in favour of One Entertainment. However, in light of the recent events, the judge has ruled in favour of the Russian entrepreneur, reasoning that the cartoon originates from United Kingdom, and further One Entertainment was acquired by Hasbro, an American company, both of which are now considered ‘unfriendly nations’ due to the restrictive sanctions imposed on Russia, and thus, the infringement claim has no merit in the present circumstances, and the copyright in ‘Peppa Pig’ can be used without permission of One Entertainment. This ruling prima facie is alarming because it opens the door for infringers and openly encourages the violation of Intellectual Property Rights in Russia without any repercussions.
Further, the Decree, as passed by Russia, violates international treaties on Intellectual Property Rights, and the countries damaged by this measure may reach out to World Trade Organization court and ask for imposition of additional sanctions on Russia. However, in the meantime, Russian businesses are most likely to capitalize this opportunity and violate IP rights including trade mark and copyright infringement, and piracy. This would discourage foreign entities from entering the Russian market, and investing in its economy.
Titiksha Sinha, Associate at S.S. Rana & Co. has assisted in the research of this article.
 Decree of the Government of the Russian Federation of 06.03.2022 No. 299 (http://publication.pravo.gov.ru/Document/View/0001202203070005?index=0&rangeSize=1)
 The case number is А28-11930/2021 in the Arbitration Court of the Kirov Region.