India: A glimpse of the Annual Report (2022-23) of the IP Division of Hon’ble Delhi High Court
INTRODUCTION
The Intellectual Property Division of the Hon’ble Delhi High Court (hereinafter referred to as the “Hon’ble IPD”) recently published its Annual Report from 2022 to 2023. The report highlights the significant progress made by the IPD over the past year. It includes valuable insights from esteemed Judges of the IPD and distinguished members of the IP Bar, as well as detailed statistics on the number of cases filed, adjudicated, and appealed before the IPD. In this article, the author aims to focus on and highlight the achievements and statistics of the IPD, specifically concerning the field of patents.
THE FIRST YEAR OF THE DELHI HIGH COURT’s IPD
It is noteworthy that in its first year, the Delhi IPD received over 2000 cases that were transferred from the now-defunct Intellectual Property Appellate Board (hereinafter referred to as the “IPAB”). With impressive efficiency and expertise, the IPD managed to resolve and close approximately 600 of these cases.
The charts below represent the tenure of the IPD in the field of patents:
· Dealing with a total of 414 patent appeals, the IPD managed to dispose of more than 45% (187) of all the patent appeals:
· From a total of 59 original petitions related to patents that were transferred from the IPAB to the DHC, over two-thirds (40) of them were resolved by the IPD:
SUMMARY OF NOTABLE DECISIONS:
The Annual Report further dedicates an entire section of the report to lay down the most notable decisions pronounced by the IPD during the past one year. The list of cases forms a relevant corpus of important precedents in matters relating to the respective subject matter. Those concerning the field of patents have been summarized below:
1. Ace Technologies Corp. v. Communication Components Antenna Inc., 2023:DHC:2479-DB
In this decision delivered by a Division Bench (IP Appellate Division), the order of the Single Judge directing Ace Technologies (Appellant) to furnish security of Rs. 54.5 crores was upheld. This interim arrangement was one of the first instances where, in a non-Standard Essential Patent case, a large security deposit was directed. Additionally, the Division Bench endorsed the use of comparable licensing agreements as a means of determining the royalty rate, even in situations that don't pertain to Standard Essential Patents.
2. Diamond Star Global SDN BHD v Joint Controller of Patents, 2023:DHC:2316
This case involves Section 3(c) of the Patents Act, 1970 (hereinafter referred to as “the Act”) which states that inventions claiming to discover a scientific principle are not patentable. The appellant sought a patent for a product called "Hygiene Wash," which contained skin care preparations with wood vinegar from the Rhizophora Apiculata tree at a specific concentration. The appellant argued that this formulation selectively targeted harmful bacteria while preserving beneficial bacteria and lacked the pungent smell found in other wood vinegars. However, the Controller examining the application rejected it, stating that the appellant merely utilized the inherent germicidal property of wood vinegar from the specific tree.
An appeal was filed against the Controller’s decision, wherein the Delhi IPD considered the balance between encouraging inventiveness and not granting patents for products lacking an inventive step. The Hon’ble IPD noted that Section 3(c) of the Act should be interpreted in light of the concept of a "new product" explained in the Novartis case. The Hon’ble IPD found that the appellant's decision to use wood vinegar from the Rhizophora Apiculata tree and the specific concentration (18 to 22%) in the skin care preparations, allowing selective targeting of harmful bacteria, preservation of beneficial bacteria, and absence of a pungent smell, constituted sufficient novelty and inventive step to justify the grant of a patent.
3. Boehringer Ingelheim Pharma Gmbh v. Vee Excel Drugs and Pharmaceuticals Private Ltd. (along with other connected suits), 2023:DHC:2269
This case addressed several significant commercial issues related to pharmaceutical patents, including the presumption of validity for old patents, the impact of non-filing of opposition against a patent on its validity, and the challenge to the validity of a species patent based on prior claiming. The Hon’ble IPD concluded that attempting to patent both the genus and species would constitute evergreening, which is prohibited under Section 3(d) of the Act. Once the 20-year term of a patent expires, the patentee cannot restrict others from dealing with a new product resulting from further research. The Hon’ble IPD emphasized that the specific coverage of a product in the patent claims is crucial, regardless of whether detailed disclosure regarding the product has been provided.
4. Intex Technologies (India) Ltd. v. Telefonaktiebolaget L M Ericsson, 2023:DHC:2243-DB
In this case, the Division Bench of the Hon’ble IPD heard cross-appeals from Ericsson (Plaintiff) and Intex (Defendant) regarding the previous order issued by the single judge. The single judge had determined that Ericsson's patents were valid, essential, and infringed by Intex. The single judge also noted that Ericsson had fulfilled its Fair, Reasonable, and Non-Discriminatory (FRAND) obligations, while Intex had shown unwillingness to negotiate a FRAND license by initiating proceedings elsewhere. The single judge had instructed Intex to pay 50% in royalty and provide a bank guarantee for the remaining 50%.
Intex challenged the order, claiming that the patents were of questionable essentiality and violated certain sections of the Act. They also argued that injunctions cannot be granted for standard-essential patents (SEPs) even if the implementor is unwilling to take a license. However, the Division Bench agreed with the single judge's findings and concluded that Intex failed to prove any deliberate suppression of relevant information by Ericsson under Section 8 of the Act.
In summary, the Division Bench found merit in Ericsson's appeal due to the wide acceptance of their SEPs in the telecom industry. To ensure fairness with other implementers, the Hon’ble IPD directed Intex to pay the entire royalty amount to Ericsson within four weeks.
5. Societe Des Produits Nestle Sa v. The Controller of Patents, 2023:DHC:000774
The present case dealt with the interpretation of Sections 3(i) and 3(e) of the Act.. The subject application used the term "composition comprising DGLA directed towards treatment" in its claims. The Hon’ble IPD ruled that the use of the term "treatment" in a claim does not necessarily fall under Section 3(i) of the Act.
The Hon’ble IPD further stated that there is no specific bar on amending claims at the Appellate stage. If the Controller has the power to direct an amendment, the High Court in appeal should have similar powers. The amendment must fulfil the requirements under Section 59 of the Act and should not be inconsistent with the original specification. Regarding the requirements of disclosure, the Hon’ble IPD held that disclosing the best-known method satisfies the sufficiency requirement under Section 10(4) of the Act. It is not necessary to enable all possible ways of operating the invention. Further, on the issue of inventive step, the Hon’ble IPD stated that if the patent application shows technical advancement over old cited prior art, it indicates non-obviousness.
6. Communication Components Antenna INC v. Mobi Antenna Technologies (Shenzhen) Co. Ltd., 2022:DHC:855
In this case, the Defendant argued for the revocation of the Plaintiff's patent under Sections 64(1)(h) or 64(1)(k) of Act. However, the Defendant did not provide enough supporting evidence or pleadings in their counterclaim. They argued that revocation based on the above provisions is purely a legal matter and doesn't require evidence or pleadings.
The Hon’ble IPD emphasized that the determination of sufficient disclosure is established by the patentee(applicant) during the patent application process. The Hon’ble IPD ruled that, to challenge the patent's validity, the Defendant must specifically demonstrate in their pleadings how the claim construction is liable to be revoked, particularly in relation to sufficiency of disclosure. The patentee should also be given the opportunity to present evidence to refute the grounds of revocation. Without this exercise, it is not possible to determine the grounds of revocation solely as a legal question by merely reading the patent specifications.
Since the Defendant failed to make a specific pleading about the insufficiency of disclosure in the patent claims and did not present evidence on the matter, the Hon’ble IPD could not definitively conclude that the Plaintiff's patent should be revoked.
7. Sotefin SA v. Indraprastha Cancer Society and Research Center, 2022:DHC:595
In the present case Sotefin SA filed a patent infringement suit against multiple defendants for their use of a patented technology titled "Carriage for the horizontal transfer of motor vehicles in automatic mechanical car parks" which was used in automated mechanical car parks. Sotefin SA had previously entered into agreements with one of the defendants (defendant 3), where drawings and information related to the technology were transferred to said defendant (defendant 3) with an obligation to keep it confidential. Later, Sotefin SA discovered that another defendant (defendant 4), operated by Defendant 3, was utilizing "Smart Dollies" for a project through a tender floated by another defendant (defendant 2). These Smart Dollies were being imported from a Chinese company by yet another defendant (defendant 1). Sotefin SA claimed that the Smart Dollies infringed their patent and that all defendants were acting in collusion, as the party they had the agreement with transferred the technology to the other defendant, and the defendant importing the Smart Dollies operated the company involved in the project. Scientific Advisors were consulted, who inspected the products and concluded that 17 out of 19 elements of Sotefin SA's patent were found in the Smart Dollies.
The Court held that if the pith and marrow of the Plaintiff’s invention are found in the infringing product, it would be sufficient to determine patent infringement. For determining the question of infringement, the non-essential or trifling variations or additions in the product would not be germane, so long as the substance of the invention is found to be copied. For such analysis, pure literal construction is not be adopted, rather, doctrine of purposive construction should be applied. Therefore, the key question was to assess whether the two elements absent in the Smart Dollies were ‘essential elements’ of Plaintiff’s Silomat Dollies. The Court applied the doctrine of equivalence to examine if the substituted elements in the infringing product perform the same function, in substantially the same way, to accomplish substantially the same result and concluded that the substance of the suit patent had been copied.
Consequently, although the Plaintiff’s patent was about to expire, noting that the protection available to a patentee is no less than what is available during the term of the patent, an injunction was granted in Plaintiff’s favour restraining Defendants from using the Smart Dollies.
8. Best Agrolife Limited v. Deputy Controller of Patents & Anr., 2022:DHC:2506
The Hon’ble IPD in the present matter remanded an order passed by the Controller back to the IPO on the reasoning that the original order was legally flawed and lacked reasoning, thereby violating the principles of natural justice. It was concluded that the petitioner had presented sufficient grounds for remanding the case to the Patent Office for a fresh review of the pre-grant opposition, specifically focusing on the issues raised in relation to Section 25(1)(f) and Section 3(d) of the Act.
9. Nippon A&L Inc. v. The Controller of Patents, 2022:DHC:2434
In this appeal under Section 117A of the Act, the Hon’ble IPD was called upon to examine whether amendment of ‘product by process’ claims to ‘process’ claims was permissible under the scheme of the Indian patent law. The Hon’ble IPD considered the impugned order of the Patent Office disallowing amendment of claims by the Appellant in its application pending grant of patent.
In this case, the Hon’ble IPD examined the original claims and determined that they were in the form of "product by process" claims. The Hon’ble IPD stated that the extent of monopoly granted by such claims depends on the interpretation of each claim. The Hon’ble IPD then analyzed whether the appellant could have amended the "product by process" claims to "process" claims under Section 59 of the Patents Act, which deals with amendment of patent applications.
Considering the legislative history and conditions provided under Section 59, the Hon’ble IPD concluded that the power of amendment granted by the section has been expanded through the Patent (Amendment) Act, 2002. The Hon’ble IPD clarified that amendments to claims prior to grant should be interpreted liberally rather than narrowly. As long as the invention is disclosed in the specification and the claims are limited to the disclosed information, the amendment should not be rejected, particularly at the examination stage prior to grant.
Based on this legal position, the Hon’ble IPD determined that the appellant was merely narrowing the scope of the claims, and the process sought to be claimed in Nippon's patent application had been disclosed in the complete specification. The Hon’ble IPD relied upon the judgment in Konica/Sensitizing [1994] EPOR 142 to support the admissibility of changing the category of claims from "product by process" to "process" under Article 123(2) of the European Patent Convention, 1973.
Consequently, the Hon’ble IPD found the Controller’s decision disallowing the amendment to be unsustainable and remanded the matter back to the IPO for further consideration.
10. The European Union v. Union of India, 2022:DHC:2301
In this case, the Hon’ble IPD was called upon to answer whether in case of non-adherence of timeline in filing response to FER within the statutory time limit due to mistake of the patent agent, can the Controller of patents and/or High Court exercising writ jurisdiction under Articles 226 and 227 condone the delay?
The Hon’ble IPD observed that according to the statutory requirement under Rules 24B (5) and (6) of the Patent Rules, 2003 (hereinafter referred to as “the Rules”) the entire process of objections and replies thereto, has to be mandatorily concluded within the time limit of six months (extendable upto three months). However, relying on the decision of Ferid Allani v. Union of India, [W.P (C) 6836 of 2006, decided on 25th February, 2018], the Hon’ble IPD observed that abandonment of a patent application will deny an applicant his substantive rights to claim exclusive rights for his invention. The question of abandonment is fundamentally a question of intent. Though expressed or implied by action or conduct, abandonment is never presumed. Thus, an extension of statutory timelines concerning patent applications may be granted after examining the factual matrix to see whether the Applicant intended to abandon the patent or not. Any extraordinary circumstances such as negligence by the patent agent or docketing error could be considered by the Hon’ble IPD. It was also observed that the patent applicants ought not suffer due to the mistake by the patent agent.
Insofar as the power to condone the delay is concerned, the Hon’ble IPD held that the Controller does not have the power under Rule 138 of the Rules to condone delay in filing response to FER. However, while exercising writ jurisdiction under Article 226 and 227 the High Court can, in exceptional circumstances restore the application and permit the Applicant to rectify the defects in the application.
11. FMC Corporation v. Best Crop. Science LLP, 2021:DHC:1987
In the present landmark matter, the plaintiff FMC Corporation (“FMC”) alleged infringement by the defendants, of a product patent and a process patent held by them in respect of the product Chlorantraniliprole (CTPR) and the process thereof.
The defendants did not dispute the fact that they were also manufacturing and selling CTPR without obtaining any licence from the plaintiff. However, the defendants, arguing with respect to the advantage of Section 107(1) of the Act, disputed the validity of the suit patents, particularly the plaintiff’s patent IN 201307 (IN’ 307).
It was contended that CTPR was already covered in IN 204978 (IN’978) which claimed a Markush structure, i.e., a generalised chemical formula in which, by substituting radicals from suggested embodiments, various products could be synthesised.
FMC did not dispute the fact that CTPR was already covered by IN’978. The contention of FMC was that, though covered, CTPR was not disclosed in IN’978. Specifically, FMC argued that there was no sufficient disclosure in IN'978 to enable a person skilled in the relevant field to derive or synthesize CTPR (a chemical compound). FMC claimed that the defendants had selectively chosen substituents from the suggested embodiments in IN'978 to arrive at CTPR, using hindsight and the knowledge that CTPR had already been discovered and claimed. The defendants argued that it was improper to challenge the validity of the patent in question by selectively picking substituents from the Markush structure in IN'978 and claiming that CTPR was either invalid due to prior claiming or prior publication.
The fundamental issue which arose for consideration was, therefore, whether there was any distinction between “coverage” and “disclosure”. Both sides relied on the only judgment of the Supreme Court on the point, i.e. Novartis AG v. U.O.I. (2013) 6 SCC 1., which contained the observation that there could not be any “wide gap or dichotomy” between coverage and disclosure in a patent. The implication of this observation was, according to the defendant, that coverage and disclosure were the same and what was covered was, ipso facto, disclosed as well. FMC contended, on the other hand, that the very observation that there could not be a wide gap between coverage and disclosure itself indicated that there was, indeed, a gap and that coverage and disclosure were not the same. It was pointed out that different benches of this Hon’ble IPD were interpreting the decision in Novartis differently.
The Hon’ble IPD concluded that the judgment itself acknowledged the distinction between coverage and disclosure. It was also recognized that challenging the validity of a pharmaceutical patent based on hindsight analysis and cherry-picking substituents was not a valid approach. In order to dispute the validity of the patent, the defendant needed to prove that a skilled person in the field, using existing knowledge and the teachings of the patent, could arrive at the claimed compound. This would require the defendant to provide reasons for selecting specific radicals to be substituted onto the structure mentioned in the patent.
In this case, the Hon’ble IPD found that the defendant did not provide an explanation for their selection of radicals from the suggested embodiments in the patent for substitution. The Hon’ble IPD deemed this to be a cherry-picking exercise with the benefit of hindsight knowledge, as the claimed compound had already been synthesized, disclosed, and claimed.
Therefore, the defendant's argument that the patent was invalid and vulnerable to challenge was rejected and an interlocutory injunction was granted.
12. Dr. Reddy’s Laboratories v. Controller of Patents, 2022:DHC:004746
In the present batch of three cases, the question before the Hon’ble IPD was whether High Courts across the country had jurisdiction to entertain revocation petitions and appeals under the Act in the post IPAB era?
Insofar as jurisdiction to deal with petitions seeking revocation of patents is concerned, the Hon’ble IPD was of the view that the effect of grant of patent is felt across the country. Thus, person interested in seeking revocation could be located in any part of the country where the factum of grant and its effect would determine its conduct. Applying the doctrine of ‘cause of action’, the Hon’ble IPD held that wherever the effect of the patent is felt and commercial interest of the person interested are affected would be a place which has nexus with the lis, and revocation petition under Section 64 of the Act can be filed at that place. In arriving at the aforesaid conclusion the Court relied upon the judgments of the Full Court of the Delhi High Court in Girdhari Lal Gupta v. K. Gian Chand Jain & Co. AIR 1978 Del. 146 and Division Bench in Ajay Industrial Corporation v. Shiro Kanao of AIR Del. 496 wherein it was held that grant of IP right has both static and dynamic effect and the jurisdiction to entertain revocation petitions cannot be limited to where the patent has been granted registration. Insofar as appeals against the order of the Controller rejecting the patent application is concerned, the Hon’ble IPD held that as soon as patent application is filed, the ‘appropriate office’ in respect of the said application is frozen.
Thereafter the Hon’ble IPD went to examine the Rules and was of the view that the term ‘appropriate office’ is of immense significance in the process of examination and grant of a patent. All the proceedings in respect of the patent application, including the hearing, are deemed to have taken at the appropriate office. In view of the said position, the Hon’ble IPD opined that the appropriate office is the ‘situs’ of a patent application. Thus, the High Court exercising jurisdiction over the ‘appropriate office’ would have jurisdiction to hear appeal against the decision of the Patent Office.
The Hon’ble IPD did not accept the submission of ld. Counsels that the concept of cause of action ought to be merged into Section 117A of the Act. The Hon’ble IPD relied upon the judgments of a ld. Single judge of the Hon’ble IPD in Scooters India v. Jaya Hind Industries Ltd. AIR 1988 Del. 82 and the Supreme Court in Godrej Sara Lee Limited v. Reckitt Benckiser AIR 2010 SC 1331, wherein it was held that there is marked difference between the nature of original proceedings and appellate proceedings.
The Hon’ble IPD further held that an arrangement made merely for administrative convenience by the CGPDTM would not give rise to facts that would vest jurisdiction.
13. Avery Dennison Corporation v. Controller of Patents, 2022:DHC:004697
The captioned case was the first case where a bench of the IPD re-assessed the decision of the Controller of Patents and ordered the grant of a Patent. The patent application being considered in this appeal was directed towards a novel fastener that enabled consistent severing of the fasteners from the stock.
While adjudicating the appeal, the Hon’ble IPD ascertained the specific features of the fastener stock which were to be tested for satisfying the requirement of Inventive Step. The Hon’ble IPD discussed the various approaches and tests adopted by courts, Judicial Authorities, and Patent Offices to determine Inventive Step. Several landmark judicial pronouncements, including the decision of the House of Lords in the Windsurfing case, the Division Bench of Delhi High Court in Roche v. Cipla, and the UK Supreme Court in Actavis v. ICOS, were discussed in detail by the Court. These tests/approaches arising from these cases as also guidelines for examination include the ‘Obvious to Try’ approach, ‘Problem/Solution’ approach and the ‘Teaching Suggestion Motivation (TSM)’ test.
The Hon’ble IPD came to a finding that there was indeed some technical advancement that was achieved by the subject patent application. Therefore, the only question that remained was if the manner in which the technical advancement was derived was obvious to a person skilled in the art or not. To answer this question, the Hon’ble IPD elucidated the fundamental principles that need to be considered while deciding the question of obviousness. The first principle is that ‘simplicity alone cannot defeat an invention’. The second critical principle elucidated was that a hindsight or ex-post facto analysis of prior art was not permissible while considering the question of obviousness.
The Hon’ble IPD further ruled that the age of the prior art is one of the indicators that the development of the subject patent from the prior art would not be obvious. Therefore, it was observed that when a long time passes since the prior art was published and a simple change resulted in unpredictable advantages, which no one had thought of for a long time, the Hon’ble IPD would tilt in favour of holding that the invention is not obvious.
Finally, while holding that the subject matter claimed in the subject patent application satisfied all the criteria of being an invention, it was ordered that the patent would proceed to grant after completing all necessary formalities in the Patent Office.
14. FMC Corporation & Ors. v. Insecticides India Limited, 2022:DHC:004770
The Hon’ble IPD in this case found that the plaintiffs failed to prove that the defendant infringed their patent rights under Indian Patent No. 298645 (IN'645). The plaintiffs had filed an application seeking to restrain the defendant from infringing their patent rights by using any process covered by the patent. The Hon’ble IPD emphasized that since it was a process patent, it was necessary to compare the competing processes to determine infringement.
Referring to previous judgments, including Sotefin SA v. Indraprastha Cancer Society and Research Center, the Hon’ble IPD stated that for infringement to be established, all essential elements of the patented invention must be present in the infringing process. However, minor variations or additions in the product would not be relevant if the substance of the invention is copied. The Hon’ble IPD applied the Pith and Marrow Doctrine, also known as the Doctrine of Purposive Construction, to determine if the substituted element in the infringing product performs the same task in substantially the same way to achieve substantially the same result.
After analyzing the essential features of the patent and the processes involved, the Hon’ble IPD concluded that the plaintiffs failed to prove that the defendant's process was equivalent to the patented process, and therefore, no infringement case was established.
15. Interdigital Technology Corporation v. Xiaomi Corporation, 2021:DHC:1493
This case is notable because it involved an Indian court restraining a party from enforcing a foreign court order, which is a rare occurrence. The Wuhan Intermediate People's Court had granted an anti-suit injunction, preventing Interdigital Technology Corporation from pursuing a case before the Indian court. However, the Indian court granted Interdigital's request to stay the anti-suit injunction.
Interdigital had filed a suit claiming patent infringement by Xiaomi Corporation, alleging that Xiaomi was using its Standard Essential Patents (SEPs) without obtaining a license at Fair, Reasonable and Non-Discriminatory (FRAND) rates. Prior to this, Xiaomi had filed a complaint in the Wuhan Court seeking a FRAND rate for Interdigital's entire SEP portfolio. The Wuhan Court granted an anti-suit injunction, and Interdigital sought an anti-anti-suit injunction from the Indian court to prevent Xiaomi from enforcing the Wuhan Court's order.
The Indian court found that the Wuhan Court did not provide notice to Interdigital regarding Xiaomi's application for the anti-suit injunction. Moreover, the two proceedings had different purposes, with the Indian case addressing patent infringement while the complaint before the Wuhan Court aimed to fix a global FRAND rate. The Indian court concluded that the Wuhan Court lacked jurisdiction to adjudicate on the infringement claim, and therefore, it was inappropriate for a foreign court to interfere with legally sustainable proceedings before the Indian court. As a result, the Indian court restrained Xiaomi from enforcing the Wuhan Court's order.
CONCLUSION
Recently the Hon’ble Madras High Court issued a notification the official gazette regarding the Madras IPD Rules. Thereafter, on April 12, 2023, the Madras IPD was officially inaugurated. The cases transferred to the Madras High Court from the IPAB will be renumbered and listed before the IPD without levying any fresh or additional court fees. Meanwhile, the other two IPDs, namely the Calcutta IPD and the Bombay IPD, are also underway and should soon be inaugurated. With a total of approximately 3000 cases transferred to the Delhi IPD and over 2000 cases transferred to the Madras IPD, the need for all the IPDs to soon be established and become fully functional is pressing. In view of the commencing stages of other IPDs, this Annual Report is a welcome initiative from the Hon’ble Delhi IPD and a beacon for the other IPDs to soon follow similar practice.
