Published on 29 July 2011 @ 10:18 am
Inside Views: A Glance At Current Patent Litigation In India
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Intellectual Property Watch
The third amendment of Patents Act 1970, in 2005, was a major breakthrough for Indian IP practice in patents. The beginning of the product patent regime in food, chemicals and drugs gave an impetus to patent litigation that started with some well-known patent disputes between innovator companies and Indian generic drug industry. This litigation space has now considerably moved ahead and lately a wave of instances has significantly indicated settling of laws in some pertinent areas of patent law. The current crop of judicial decisions, as discussed in this note, has initiated the need to have a critical mass of judicial precedents streamlining law and rules governing patent practice in India.
The case of Dr Snehlata C. Gupte v. Union of India & Ors (W.P. (C) No 3516 and 3517 of 2007) was instrumental in determining when a patent can said to be granted under the Patent Act 1970 (the Act). This lack of clarity led to a scrutiny of the relevant provisions the Act and also the existing process with a time gap between the grant and the issuance of the patent certificate. The court, while holding that the date of grant of a patent is the date on which the Controller passes an order to that effect on the file, noted that the language, “a patent shall be granted as expeditiously as possible” does point out that a patent has to be granted once it is found that either the application is not refused in a pre-grant opposition or otherwise is not found in contravention of any provision of the Act.
Therefore, the decision taken by the Controller on the file is the determining event for ascertaining the date of grant of patent and the acts of sealing of the patent and entering the same in the Register are ministerial acts evidencing the grant of patent.
Another instance of interpreting law came up in cases Universidad Politechnica De Valencia v. Union of India & Ors (Writ Petition No. 1435 of 2007; Bombay High Court), and Telefonaktiebolaget LM Ericsson v. Union of India & Ors (W.P.(C) 9126 of 2009; Delhi High Court. In both cases, the issue pertained to the deeming fiction of abandonment of the patent application in absence of compliance with the requirements imposed by or under the Act. In the Spanish University case, the court clarified that the right of hearing is an inherent part of the Controller’s judicious exercise of discretion while making a decision whether there is an abandonment of a patent application. Therefore, even if a combined reading of the relevant provisions gives an appearance that the claim for hearing must be made within a time as specified in the Act, the usage of “shall” contemplates that the hearing is mandatory and does not exclude the right of hearing if sought, in cases, even after the prescribed period.
In the Ericsson case, the grievance was with respect to the nature of the Controller’s order under the provision effecting deemed abandonment of a patent application. The Act does not allow appeal against such orders. The court found favour with Ericsson’s argument that if replies to the objections as raised in examination report do not comply with the requirements of the Act, then the Controller should refuse the application or may require the application to be amended to his satisfaction, rather than deciding that the application is deemed to be abandoned. This would also give an opportunity to appeal. The court thus held that the provision on deemed abandonment of a patent application makes it imperative to show the requirement of replying to the objections as raised in the examination report. Whether the reply meets the objections satisfactorily is a different matter. In effect, there should be a manifest intention requiring a conscious act on the part of the applicant to abandon the application, such as doing nothing by way of meeting the objections raised within the stipulated time or not seeking extension of time for that purpose. If there is a reply, and it is found that the same is unsatisfactory, then the Controller can either refuse the application or require it to be amended to his satisfaction.
Yet another instance absolutely on point is Nippon Steel Corporation v. Union of India W.P. (C) 801 of 2011 illustrating that timelines are central to patent law and procedures and are sacrosanct as they define an essential character of patents as an intangible property. The patent agent of Nippon Steel, as alleged, inadvertently missed the deadline for filing a Request for Examination (RFE). As provided under the Act, an RFE is to be filed within a period of forty-eight months from the date of priority or the date of filing the application, whichever is earlier. The agent, having missed the deadline, sought to amend the priority date of the application to the international filing date of the PCT application. The idea was that making this amendment the deadline for RFE would go further by a year and the application would be saved from being lapsed. However, the Indian Patent Office informed the agent that the amendment could not be effected, as due to non-filing of RFE the application had become time barred and deemed to be withdrawn under the Act. The court, upholding the decision of the patent office, stressed the legislative intent behind the provisions saying that the time limits are “mandatory” and not merely “directory”. The scheme of the Act and rules constitute a complete code and once an application is deemed to be withdrawn under the Act, then the Controller cannot entertain an application for amending any portion of such application.
This window to the recent patent litigation in India is enough to show that there has been a commendable effort from judiciary to put at rest the climate of legal uncertainty in patent law. In the “Snehlata Case”, the court also impressed upon the Controller to have a list of cases for pronouncement of orders and publish the same as it happens in courts and also that the wording of the final order granting a patent should say that “the patent is hereby granted” only after all the amendments are carried out to the satisfaction of the Controller by the applicant within the granted time. A failure to carry out the amendments as directed by the Controller or Assistant Controller within the time granted may result in rejection of the application under the Act. The court also directed the patent office to not only disclose award of patents on a real-time basis, but also electronically circulate the hearing dates of grant on patent applications a day before.
On substantive patent law, the judiciary yet again showed a laudable effort to bring forth the legislative intent behind the provisions. In the case Dr Aloys Wobben v. Shri Yogesh Mehra & Ors IA No. 12638/2010 in CS (OS) No 1963/2009; Delhi High Court, Aloys Wobben sought to restrain Yogesh Mehra, in the suit filed complaining patent infringement, from pressing his counter claim in the written statement pleading invalidity of Aloy Wobben’s patents and to revoke them. Aloys Wobben argued that Yogesh Mehra has already availed his statutory right of invoking revocation of patents before the Intellectual Property Appellate Board (IPAB) and therefore his approach in pursuing parallel and concurrent remedies is in defiance of the Doctrine of Election.
The Patent Act, 1970, provides for availability of every ground on which a patent may be revoked, to be raised as a defence in any suit for infringement of a patent. Thus Yogesh Mehra contented that the doctrine cannot oust statutory remedy which can only be waived consciously and in addition the nature of relief sought by Aloys Wobben is out of the purview of the court. The court also reasoned favouring Yogesh Mehra and held that the remedies, i.e., an action for revocation before IPAB and as a counterclaim in a suit for infringement, though seemingly overlapping may not be necessarily availed simultaneously. For instance, a third party sued for infringement may prefer an application before the IPAB for cancellation or revocation. If his application before the Board is held to be not maintainable, or alternatively, he is asked not to raise the ground of cancellation in his written statement, his defence would be seriously prejudiced and therefore it would be contrary to the statute and also against public policy to hold that there cannot be a pursuance of an independent statutory remedy.
In intellectual property rights litigation in India, particularly in suits for patent infringement, the stage of interim injunction is often a stage of intense fighting because after this it may happen that the suit may get lost in trial. An interim injunction is what a plaintiff wrestles for while the defendant makes every effort to counter this. What happens when there is an ex-parte interim injunction? Lately, the Delhi High Court’s Division Bench in the case TenXc Wireless Inc v. Andrew LLC & Ors (FAO No 697/2010) Delhi High Court, while disposing an appeal contesting the suspension of the ex-parte ad-interim injunction favouring TenXc, set aside the suspension and gave directions that the single judge may decide Andrew’s application under Order XXXIX Rule 4 of the Civil Procedure Code, 1908 (CPC), to vacate the ex-parte ad-interim injunction, afresh after giving an opportunity to hear the patent holder.
TenXc had preferred a suit for permanent injunction, delivery up, rendition of account of profit and damages against infringement of its registered Indian against Andrew LLP & others. The single judge granted an ex-parte ad-interim injunction. Andrew preferred a Letters Patent Appeal, which remanded the case back for compliance of provision under Order XXXIX of the CPC. Consequentially an application under Order XXXIX Rule 4 of the CPC was moved by Andrew, which was disposed of by vacating the ex-parte ad-interim injunction.
Rule 4 of Order XXXIX of the CPC empowers court to vacate an order of injunction if the party has made a false or misleading statement in relation to a material particular and the injunction was granted without giving notice to the opposite party.
TenXc appealed against the suspension of the ex-parte ad-interim injunction order on its grievance that the single judge incorrectly viewed the filing of patent specification downloaded from the official website of Indian Patent office, instead of certified copies as a deliberate act to present filtered and selective information, suppress material particulars, misstate facts and gain undue benefit, even though the Patent certificate was issued earlier.
The Court was of the view that Andrew’s application under Order XXXIX Rule 4 of the CPC levels very serious allegations against TenXc and in absence of a written response from TenXc the Court is unable to appreciate the contentions of the parties and also the findings of the single judge and the records of the proceedings are reticent on the point that fervent requests were made by TenXc to file a reply and the single judge ignored the same. Since the pervading perception of the single judge was that TenXc had knowingly made false or misleading statements in relation to material particulars, it should have been afforded an opportunity to controvert the Andrew’s statements. The Court factored in these views to set aside the order of the single judge suspending the ex-parte ad-interim injunction order and also observed that the interest of justice may be undermined if an opportunity to controvert or respond to vital facts is not given.
Although an ex-parte injunction granted in a summary proceeding without the alleged infringer being heard, works on the legal basis that the object of granting injunction should not be defeated by delay, do not hold much water in cases of patent infringement as the requirements of urgency and legal foundation of the case has to be prima facie plausible that the patent is both valid and infringed, both validity and infringement issues requiring thorough examination and technical expertise.
Patent litigation in India has grown considerably and has led many Indian firms to enforce or oppose patents. In general, the awareness about patents and its commercial exploitation is being increasingly used by companies as a potent tool in formulating competitive strategy. As a result, an increased number of patent disputes are landing in courts, playing a very important role in ultimately resolving the disputes and interpreting the law.