In India, inventions are generally protected by patents, which are statutory rights created under the Patents Act, 1970 (the Act). The Act defines an "invention" as a new product or process involving an inventive step and capable of industrial application. The Act expressly excludes certain subject matter from patentability (Sections 3, 4, 35 and 37). Inventions can also be protected by trade secrecy laws, which are not codified, but recognised in common law.
A patentee has the exclusive right to prevent third parties, who do not have his or her consent, from the act of making, using, offering for sale, selling or importing for those purposes that product in India. In the case of a process patent, the patentee has similar exclusive rights (Section 48).
The scope of the statutory right has been determined by case law. Therefore, both statutory law and case law determine the scope of legal protection afforded to inventions in India.
Every application for a patent shall be for one invention only along with provisional/complete specification. A complete specification has to be filed within 12 months of the filing of the provisional application (Section 9).
A patent application is not open to the public before the expiry of 18 months from the date of filing or date of priority, whichever is earlier, after which the application in published by the Indian Patent Office (Section11A & Rule 24). The applicant may, request that the Controller of Patents (Controller) publish his or her application at any time before the expiry of 18 months if the complete specification has been filed.
The applicant or any person interested may make a request for examination (Section 11B). If no such request for examination is filed within the prescribed time limit, the application shall be treated as withdrawn by the applicant. If the request for examination was filed by a person interested, the examination report is sent to the applicant only and intimation is given to the person interested.
Expedited examination is available to the following categories of applicants:
The examiner shall make a report on patentability and other matters relating to the statutory compliance of the application, ordinarily in one month but not exceeding three, and make a report to the Controller (Section 12 & Rule 24B (2)(ii)).
The Controller shall dispose of the report of the examiner within one month from the date of receipt of the report. A first statement of objections (First Examination Report; FER), along with any documents as may be required, shall be issued by the Controller to the applicant or his or her authorised agent within one month from the date of disposal of the report of the examiner by the Controller (Rule 24B (2)(iii) and 24B (3)).
The applicant is required to comply with all the requirements imposed upon him or her by the statute as communicated through the FER.
If the reply filed by the applicant is not satisfactory, the Controller shall offer a hearing and decide the case on merits.
The time for putting an application in order for a grant is six months from the date of issuance of FER, this can be further extended for a period of three months at the request of the applicant. However, these timelines are not applicable in cases where there is a pre-grant opposition.
Typically, the grant procedure in India had taken about three to four years. With the introduction of the expedited procedure to grant patents on a case-by-case basis, the time taken has been drastically reduced, to 18 months or less. The applicant is free to file the application by himself or herself; or through a registered patent agent. An applicant who is not a resident of India is required to either file through a registered patent agent or provide an address for service in India.
The average cost of the grant of a patent for an individual or a start-up is approximately USD78, for a small entity it is USD196 and for a large entity it is USD392.
The term of a patent in India is 20 years from the date of the application.
A patent of addition is granted for a term equal to that of the patent for the main invention.
The Act provides the patentee of a product with the exclusive right to prevent third parties, who do not have his or her consent, from the act of making, using, offering for sale, selling or importing for those purposes that product in India. In case of a process patent, the patentee has similar exclusive rights. Products obtained directly by the patent process in India are also protected (Section 48). A patentee also has the right to assign and license the patent.
It is obligatory for an applicant to disclose prosecution of an application for a patent in any country outside of India in respect of the same or substantially the same invention within six months from date of filing of application.
To keep a patent in force, there is an annual renewal fee which can be paid more than one year in advance.
The Act also sets forth general principles applicable to the working of patented inventions. A patentee and every licensee shall furnish, at intervals not less than six months, statements of working in India (Section 146).
Indian law does not extend protection to a granted patent beyond its maximum term of twenty years. The concept of Supplementary Protection Certificates is not recognised under Indian law.
Any person may file a pre-grant opposition at any time after the publication of patent application. The Controller shall consider the pre-grant opposition along with the FER and, if deemed necessary, shall issue a notice to the applicant.
Any person may file a pre-grant opposition at any time after the publication of patent application, but before the grant of patent.
Unlike a pre-grant opposition which can be filed by “any person”, a post-grant opposition can only be filed by a “person interested”. A post-grant opposition may be filed within one year from the date of grant of patent.
Any person interested, or the Central Government, may file a revocation petition at any time after the grant of a patent before the Intellectual Property Appellate Board (IPAB).
In all cases, the applicant or the patentee has the right to be heard before any decision is delivered.
An order refusing grant of patent by the Controller is appealable before the IPAB within three months from the date of decision by the Controller. While there is no statutory appeal from orders of the IPAB, a writ can be preferred before the appropriate jurisdictional High Court against such an order.
A patent shall cease to have effect if the prescribed fee is not paid before the expiration of the period prescribed for the payment of any such renewal fee. Such a lapsed patent may be restored by filing a restoration application within 18 months from the date on which the patent ceased to have effect.
An application for restoration has to state the circumstances which led to the failure to pay the renewal fees along with a request for a hearing. If the Controller is prima facie satisfied with the reasoning in the application, the same shall be published in the official journal. The additional fee payable for an individual or start-up is USD67, for a small entity it is USD168 and for a large entity it is USD336.
A patentee, the exclusive licensee or a compulsory licence holder of a patent (right-holder), can file an action of patent infringement. Prior to filing a suit, a right-holder may issue a legal notice to the alleged infringer, requiring them to cease and desist from the actions complained of. However, the issuance of a legal notice is not mandatory, and right-holders may elect to directly file a suit without issuing a notice.
Right-holders also have the option to issue a mediation notice to the alleged infringing party, inviting them to amicably resolve the matter, prior to issuing a legal notice or filing a civil suit.
However, an infringement suit would often be the preferred choice of legal action, if the patent holder is seeking immediate interim relief.
There is no criminal remedy available for patent infringement under Indian law.
The following are the remedies available to third parties to remove the effects of patent rights:
Certain decisions made by the Controller are subject to review by the Controller himself or herself. The Controller also has the power to correct clerical errors in any matter which is entered in the register with or without a request for such a correction (Section 77 (1)(f) and 78). The decision of the Central Government to revoke a patent in the public interest and/or the grant of a compulsory licence is appealable before the IPAB (Section 66 & 91).
Any decision, order or direction of the Controller is appealable before the IPAB (Section 117A).
There is no statutory appeal against the decisions of the IPAB, and only a writ can be preferred before the appropriate jurisdictional High Court.
In the case of patent infringement, at the first instance, a suit can be instituted before the District Court having appropriate jurisdiction. If the infringement action is valued at not less than INR300,000 (approximately USD4,211) for the purpose of court fee, the case will be designated as a commercial dispute, enabling expeditious and efficacious disposal of the case. Every decision of the District Court is appealable before a single judge of the jurisdictional High Court. Appeals from judgments or orders of the single judge will lie before the Supreme Court of India.
Some High Courts (High Courts of Delhi, Bombay, Calcutta, Madras and Himachal Pradesh) have original jurisdiction to entertain a patent infringement action at the first instance. Such cases will be heard by a single judge of these High Courts. Appeals from orders or judgments of a single judge will be filed before a Division Bench (two judges) of the same High Court.
Appeals from judgments or orders of the two-judge Benches of these five High Courts can be filed before the Supreme Court of India, which is the court of last instance.
Pre-grant and post-grant oppositions and revocation petitions are adjudicated by the Controller of Patents which is a specialised authority.
The IPAB, which hears appeals from the decisions of the Controller, is a quasi-judicial body and has a technically qualified member on its board.
There are no specialised courts to deal with patent infringement actions.
A patent infringement action can only be filed upon grant of the patent, even though the claim of damages can date back to the date of application.
If the suit falls within the commercial jurisdiction of a court because of its valuation, and no urgent interim relief is sought, a patentee is required to exhaust the possibility of pre-institution mediation and settlement of dispute.
A party can represent himself or herself in person at all stages of proceedings before the Controller, the IPAB and the courts. However, parties generally engage an advocate to represent them before these fora, to ensure compliance with all formal legal requirements.
Interim injunctions are available in patent infringement law suits. An interim injunction is a discretionary equitable relief granted by courts to a person who brings an action of patent infringement. Indian courts generally follow the test laid down in the case of American Cynamide Company v Ethicon Ltd. ((1975) 1 All. E.R. 504) in deciding whether to grant an interim injunction.
A party seeking an interim injunction will have to establish that:
The court will also consider, if the person against whom the interim injunction is granted, will suffer injury, for which he or she cannot be adequately compensated at a later stage (Wander Ltd & Anr. v Antox India pvt. Ltd., 1990 (Supp) SCC 727).
Factors weighing against the grant of an interim injunction include the following:
A potential defendant who anticipates legal action may file a caveat application before the appropriate court, which will ensure that he or she receives advance notice if any patent infringement suit is filed against him or her. Filing a caveat application will ensure that there is no ex parte hearing of the interim injunction application.
A potential defendant may also seek a declaration that his or her use does not infringe a patent (Section 105).
If a person is aggrieved by any groundless threat made by a patentee, he or she can seek a declaration that such threats are unjustifiable, injunction, and damages (Section 106).
In some cases, a potential defendant may decide to file an application to revoke the patent in question, although if not carefully worded, this could amount to an admission that the potential defendants infringe the patent.
A defendant faced with the possibility of being restrained by an injunction could also seek an undertaking from the plaintiff that, if the suit is dismissed, it shall compensate the defendant for the damage or loss caused, including but not limited to loss of earnings.
The limitation period for instituting a lawsuit for patent infringement is three years from the date of knowledge of infringement. In cases of continuing infringement, each fresh act of infringement gives rise to a cause of action in favour of the patentee.
In the case of information maintained by the Controller of Patents, any person can obtain information relating to patents from the Controller of Patents after payment of the prescribed fee for it (Section 153). In some cases, information maintained by public authorities, such as tenders awarded for public contracts, can be sought through the Right to Information Act, which enables citizens of India to seek information from government bodies. The Right to Information Act route could be used to gather information on a potential infringer, where the infringement also involves contracts or written communication or other recorded contact with a public authority.
There is no mechanism in law to obtain information and evidence from the other party or a third party before the institution of a lawsuit, apart from private investigative efforts.
Discovery of documents is available under Indian law, from any party. Any party to a proceeding may seek, or the court may order, at any time during the pendency of the suit, production by any person, of documents in the possession or power of a party or person, relating to any matter in question in the suit.
Every document which will throw any light on the case is a document relating to a matter in dispute in the proceedings, though it might not be admissible in evidence (M.L.Sethi v R.P.Kapur (AIR 1972 SC 2379)).
Non-compliance with an order of discovery can lead to an adverse inference against a non-complying party (Order XI, Code of Civil Procedure (CPC)).
When parties wish to rely on documents/information that are confidential in nature or are proprietary trade secrets, the court may constitute a “confidentiality club” so as to allow limited access and preserve the sanctity and confidentiality of such documents/information. At present, only the Delhi High Court Rules have express provisions for the constitution of confidentiality clubs. confidentiality clubs are comprised of lawyers and experts of either party who are bound by confidentiality and such documents will be placed in the safe custody of the court. Copies of such documents are not given to the other party; only redacted copies are made available under the orders of the court (M. Sivasamy v Vestergaard Frandsen A/S & Ors, 2009 (113) DRJ 820 and Telefonaktiebolaget LM Ericsson v Xiomi Technology, 2007 SCC OnlineDel 11069).
In any jurisdiction other than Delhi, a party seeking protective orders in respect of confidential information, will have to make a specific application setting out the nature of the information sought, the basis for seeking such protective measures and the hardship that will be caused if the confidentiality of the documents is not maintained.
Every pleading shall contain a statement in a concise form of the material facts on which the party pleading relies. All pleadings shall be verified by the party pleading who is acquainted with the facts of the case, and who shall also furnish an affidavit in support of his or her pleadings.
Pleadings can be amended at any stage by either party with the leave of the court subject to such terms as may be just (Order VI, CPC). There is no separate standard of pleading prescribed by law for a patent infringement law suit. However, a plaint filed in a patent infringement suit should contain the scope of the patented invention that is the subject matter of the suit and a comparison of the claims of the patent with the product or process alleged to be infringing.
The written statement of defence shall contain specific pleadings which constitute new facts not contained in the plaint. It shall also contain a specific denial of allegations contained in the plaint. In addition, the defendant can also set up a counterclaim against the claim of the plaintiff (Order VIII, CPC).
The party pleading shall, along with the plaint or the written statement of defence, file those documents in his or her power or possession which he or she relies upon in support of their pleadings.
Special Standards for Commercial Disputes
Pleadings in a commercial dispute are subject to more stringent rules, as the amendments that introduced the category of “commercial” disputes were intended to ensure speedy disposal of disputes.
Pleadings in a commercial suit, especially matters related to intellectual property rights, should be precise and concise in spelling out the basis of claim or defence. Documents relied upon should be thoroughly examined and filed along with the pleadings so as to avoid pleas for filing additional documents at a later stage (Vifor (International) Limited v Suven Life Sciences Ltd. CS(COMM) 2019 SCC Online Del 7514 and GSK Consumer Healthcare S.A. v EG Pharmaceuticals & Ors., 2019 SCC Online Del 10796). Every pleading shall be verified through an affidavit of a statement of truth signed by the party who is acquainted with the facts of the case. In the written statement of defence, the denial of facts in the plaint shall be accompanied by a statement of the reason(s) for doing so and, if intended, put forward a different version of events from that given in the plaint.
The plaint should be accompanied by all documents pertaining to the suit, in the power, possession, control or custody of a party, irrespective of whether the same is in support, of or adverse to, the plaintiff’s case with a declaration on oath to that effect. Similar rules are applicable to the written statement of defence and counterclaim raised by the defendant.
In commercial disputes, except by the leave of the court, parties are not allowed to rely on documents, which were in their power, possession, control or custody and not disclosed at the time of filing the plaint or written statement of defence or counterclaim (Order XI, CPC).
Representative or class action suits are not expressly recognised under Indian law for patent infringement suits.
However, the Code of Civil Procedure, which applies to all civil proceedings, recognises representative suits in cases where there are numerous persons having the same interest. One or more of such persons may sue or defend, on behalf of, or for the benefit of, all persons interested (Order I Rule 8, CPC).
Any patent is subject to the condition that it can be used by the government, for its own purposes. In the case of a patent in respect of any medicine or drug, the government may import the medicine or drug for the purpose of its own use or for distribution in any dispensary, hospital or other medical institution (Section 47).
A patent can be used by any person, for the purpose of experiment or research including the imparting of instructions to pupils (Section 47). The act of making, constructing, using, selling or importing a patented invention solely for uses reasonably related to the development and submission of information required under the law in force in India or overseas will not amount to infringement (Section 107A). Recently, the Delhi High Court ruled that export of a patented invention for experimental purposes would also be covered by the exemption (Bayer Corporation v Union of India & Ors 2019 SCC Online Del 8209).
Importation of patented products by any person from a person who is duly authorised under law to produce and sell or distribute the product will not amount to infringement (parallel imports) (Section 107A).
The interface between patent law and competition law is still a developing area of law. Generally, the act of a patentee could qualify as an abuse of dominant position if that act cannot reasonably be considered as an attempt to establish its rights but only serves to harass the other party, and is intended only to eliminate competition.
A suit for patent infringement may be filed against any party that, without the consent of the patent holder, uses the invention (product or process) in the act of making, using, offering for sale, selling or importing for those purposes that product or the product obtained directly by that process in India, and such a party is considered a “necessary party” to the suit (Section 48).
In the case of a patent that is jointly owned, an infringement action is maintainable by one of the co-patentees against a third party, without making the other co-patentee a party to the suit, provided that there is no conflict of interest between them (M.C.Jayasingh v Mishra Dhatu Nigam Ltd &Ors, 2014 SCC Online Mad 163).
An exclusive licence holder has the same right as a patentee to institute a suit for an infringement committed after the date of licence, by making the patentee a party to the suit (Section 109).
A compulsory licence holder can call upon the patentee to take proceedings to prevent any infringement of the patent, and, if the patentee refuses or neglects to do so within two months after being called upon to do so, the licence holder may initiate infringement action in his or her name by making the patentee a party to the suit (Section 110).
Case law in India has recognised infringement to be of two types: (i) direct infringement which is otherwise known as textual infringement, meaning the infringing product is the same as the claimed invention; and (ii) indirect infringement which is otherwise understood as infringement in substance (M.C. Jyasingh v Mishra Dhatu Nigam Limited & Ors, 2014 SCC Online Mad 163).
To establish indirect infringement, a plaintiff will have to demonstrate that, in the case of a product patent for an apparatus, that the alleged infringing apparatus consists of substantially the same parts acting upon each other in substantially the same way as the apparatus claimed in the patent.
Infringement by the doctrine of equivalents is also recognised as a form of indirect infringement. In the case of infringement by equivalents, the court will examine if the infringing article incorporates the “pith and marrow” of the invention (Raj Prakash v Mangath Ram Choudhary & Ors, AIR 1978 Del 1).
The majority of reported decisions on patent infringement have been issued at the stage of consideration of the interim injunction application. In comparison, very few judgments have been issued by courts after conclusion of trial. The scope of protection for a patent has been determined largely at an interim stage, and courts have therefore also considered whether, prima facie, the patent itself is valid.
The scope of protection to a patent is determined by the claim or the claims defining the scope of the invention for which protection is claimed and which disclose(s) the best method known to the applicant for performing the invention (Section 10 (4) (b) & (c)) (F. Hoffmann-La Roche Ltd. & Anr. v Cipla Ltd., 2015 (225) DLT 291).
Indian courts have broadly applied the following principles in determining patent rights:
Statutorily, every ground on which a patent can be revoked is also available as a defence in a suit for patent infringement (Section 107, read with Section 64).
Challenges to a patent are common in infringement suits. Prior use or publication is a standard defence. However, courts have been careful to note that "mosaicing" of individual documents or prior uses is not permissible in showing prior publication (Bilcare Ltd. v Amartar Pvt. Ltd., 2007 SCC Online Del 1712).
The “Gillette defence” is also accepted in India, deriving its name from the judgment of the House of Lords in Gillette Safety Razon Co. v Anglo-American Trading Co., 30 RPC 465. The Gillette defence arises when a defendant can show that the alleged infringement was not novel. This defence is demonstrated by showing that the act complained of was disclosed in a prior publication (Ravi Raj Gupta v Acme Glass Mosaic Industries, 1995 (32) DRJ; J.Mitra and Co. Pvt. Ltd. v Kesar Medicaments and Anr., 2008 (102) DRJ 106 and Hindustan Lever Ltd. v Godrej Soaps Ltd. & Ors., AIR 1996 Cal 367).
At the interim stage, non-working of a patent has also been held to disentitle a patentee from the relief afforded by interim injunction (Sandeep Jaidka v Mukesh Mittal & Anr., 2014 (5) HCC (Del) 715 and U. Varadaraya Nayak v S.K. Anand & Ors., 2013 (205) DLT 725).
The Act empowers the court to appoint an independent scientific advisor (whose qualifications are prescribed), to assist the court or to inquire and report upon any such question of fact or of opinion as it formulates (Section 115 and Rule 103).
Parties to a suit can field experts in support of their case (Section 45 of the Indian Evidence Act). These experts will be subjected to cross-examination by the opposing party. Before a court accepts expert evidence, it will assess whether the expert has the basic educational qualifications and minimum research experience to be deemed an expert as per law (Vringo Infrastructure Inc. & Anr. v Indiamart Intermesh Ltd. & Ors., 2014 SCC Online Del 3907).
There is no separate procedure for constructing the terms of a patent’s claims. However, the courts will construct the claim in every patent infringement dispute, as a precursor to determining whether there is infringement.
The following are the principles of claim construction that laid down by the court (F. Hoffmann-La Roche Ltd. & Anr. v Cipla Ltd., 2015 (225) DLT 291 and Merck v Glenmark, 2015 SCC Online Del 8227):
The court will first determine what the invention is. The court attempts to construe the claims which have been alleged to have been infringed without any reference to the specifications and to refer to the specification only if there is any ambiguity or difficulty in the construction of the claims in question (Farbweke v Unichem, (1974) 76 Bom LR 130 and Raj Prakash v Mangath Ram Choudhary & Ors, AIR 1978 Del 1).
In deciding what is substantial to a patent, a purposive construction is given to the patent in order to constitute the “pith and marrow” of the invention (Bajaj Auto Ltd. v TVS Motor Company Limited (2009) 3 CTC 129 and Raj Prakash v Mangat Ram Choudhary & Ors, AIR 1978 Del 1).
A granted patent can be revoked on a petition of any person interested, or of the Central Government, before the IPAB. Alternatively, revocation can be sought as a counterclaim in a suit for infringement of the patent. The following grounds may be used (Section 64):
In addition, the Act empowers the Central Government to revoke the patent if the invention relates to atomic energy, if it is prejudicial to the public or two years after the grant of a compulsory licence under certain conditions (Sections 65, 66 and 85).
In a challenge to a patent praying for revocation of that patent, the onus of proof is on the one who mounts the challenge.
The Controller does not have the express power to partially revoke or cancel a patent. A court in an infringement action can partially revoke/cancel a patent claim, if it is found that any claim, being a claim in respect of which infringement is alleged, is valid, but that any other claim is invalid. The court may grant relief in respect of any valid claim which is infringed (Section 114 and Novartis AG & Anr v Cipla Ltd., 2015(216) DLT 689).
In any proceedings before the IPAB or the jurisdictional High Court for revocation of a patent, or in a suit for infringement, the patentee may be allowed to amend his or her complete specification in such a manner – and subject to such terms as to costs, advertisement or otherwise – as is deemed fit. If, in any proceedings for revocation, the IPAB or the jurisdictional High Court decide that the patent is invalid, they may allow the specification to be amended instead of revoking the patent (Section 57).
No amendment to a patent or a complete specification or any document related to it, shall be made except: (i) by way of disclaimer, correction or explanation; and (ii) for the purpose of incorporation of actual fact. No amendment of a specification will be allowed: (i) to claim or describe matter not, in substance, disclosed or shown in the specification before the amendment; or (ii) where the amended specification would not fall wholly within the scope of a claim of specification before amendment (Section 58).
The amendment of claims may be allowed provided that it is by way of clarification or elaboration in nature and does not alter the scope of the claim or introduce any new claim in the invention (AGC Flat Glass Europe SA v Anand Mahajan & Ors., 2009 (41) PTC 207).
Where a counterclaim of revocation is filed in a pending patent infringement law suit, the suit and the counterclaim will only be heard by one jurisdictional High Court. The suit and the counterclaim are then heard and tried together, even though the issues that arise in each will differ and will require separate evidence to be led.
However, if a party initiates a post-grant opposition, the filing of that opposition would preclude the party from filing a revocation petition before the Controller and from filing a counterclaim for revocation of the patent.
If the patent infringement suit is designated as a commercial dispute based on the specific valuation of the suit, certain special procedures are applicable to the proceedings under the Commercial Courts Act, 2015. To fast track disposal of suits, the Commercial Courts Act has strict timelines to be followed at each step of the proceedings. Significant provisions for “Summary Judgment” and “Case Management Hearing” are provided for under the Commercial Courts Act (Order XIII-A & XV-A, CPC).
Prior to commencement of trial, any party to a suit can apply to the court seeking summary judgment on specific grounds, and the court will decide the application by adjudicating whether the suit can be decided, without recording oral evidence, based only on the pleadings and documents filed before it. If there are triable issues that have been raised and there is no clear and unambiguous admission, then the suit will not be adjudicated by way of summary judgment.
Trial can take place before the court, the registrar, or in some cases before an advocate or a retired judge who is designated as a “Local Commissioners”. Local Commissioners are appointed by the court to discharge several functions, including conducting trial and recording the examination and cross-examination of witnesses. Trials in patent infringement suits, particularly in Delhi, often take place before Local Commissioners, which ensures speedy completion of the proceedings.
In the jurisdiction of the Delhi High Court, the rules (Delhi High Court (Original Side) Rules, 2018) permit the constitution of a “confidentiality club” where parties wish to rely on documents/information that are commercially or otherwise confidential in nature, to allow limited access to such documents/information. The Delhi High Court Rules have also adopted the protocol of “hot-tubbing” in which expert witnesses give evidence simultaneously in each other’s presence and in front of the judge, who puts the same question to each expert witness.
Proceedings before the IPAB are decided by a tribunal comprising of one judicial member and one technical member. The technical member is scientifically qualified and well versed in the field of patents. Proceedings before the courts (District Courts, High Courts and the Supreme Court) are before judges, who do not necessarily have a specialisation in patent law. Parties before the IPAB and courts have no influence over who the decision maker is.
Right-holders also have the option of issuing a mediation notice to the alleged infringing party, inviting them to amicably resolve the matter, prior to issuing a legal notice or filing a civil suit (Section 12A of the Commercial Courts Act). The endeavour to settle the dispute can be made by the parties themselves or at the suggestion of the court at any stage of the proceedings (Section 89 of CPC).
The Act does not expressly deal with a situation where there are parallel revocation/infringement proceedings. There are judgments that hold that a party seeking revocation will have to choose between “revocation” by way of counterclaim in an infringement action and “revocation” proceedings before the IPAB, and the earlier proceeding of the two will determine the outcome of the challenge to the patent (Alloys Wobben & Anr. v Yogesh Mehra & Anr., 2014(15) SCC 360 and Ajay Industrial Corporation v Shiro Kanao of Ibaraki City, AIR 1983 Del 496).
A patentee can seek a decree of permanent injunction restraining the infringer from the act of making, using, offering for sale, selling or importing the product or process covered by the suit patent and damages or account of profits. Damages can be imposed only if the patentee proves that, at the date of infringement, the defendant had knowledge of the patent (Section 111).
The court may also order that the goods found to be infringing shall be seized, forfeited or destroyed, as deemed fit without any payment of compensation (Section 108).
Courts have the discretionary power to impose costs (Section 35, CPC) and also compensatory costs in respect of false or vexatious claims (Section 35A, CPC). Such costs will have to be actual, reasonable costs including the costs of the time spent by the successful party, their transportation and lodging, if any, or any other incidental cost besides the payment of the court fee, lawyers' fees, typing and other costs in relation to the litigation (Salem Advocate Bar Association v Union of India, 2005 (6) SCC 344). In the case of TEN XC Wireless Inc. v Mobi Antenna Technologies (Shenzhen) Co. Ltd. (2012 (187) DLT 632), the court directed that the unsuccessful party, at the end of the trial will be liable to pay costs to the successful party. Both parties are directed to submit their estimates of future costs, so that the parties will have notice of the actual costs that the other side estimate will be incurred in the course of litigation and the same shall be considered at the stage of final arguments.
During the hearing of the suit, if either party causes delay, the court may impose costs on such a party (Section 35B, CPC).
The Act does not have an express provision dealing with the rights of a prevailing defendant in an infringement action. However, if the defendant prevails, he or she can seek costs under the provisions of civil law (Section 35, CPC).
The Act provides for civil remedies of injunction and damages or account of profits. In addition, the court may also order the seizure, forfeiture or destruction of the infringing goods.
The appellate court may impose certain conditions while granting an injunction. These conditions vary on a case-to-case basis. Some of these conditions are:
There is no special provision for appeals concerning patents. If the dispute is designated as a commercial dispute, then the appellate court shall endeavour to dispose of the appeal expeditiously – within six months from the date of filing of the appeal (Section 14 of the Commercial Courts Act).
The first appellate court has the same powers and performs as are conferred on the court of first instance where the suit was instituted, and there can be a full review of the facts of the case after it has been decided on merits after trial. The first appellate court has the power to judge the correctness of findings of facts as well as of law recorded by the trial court (Section 107 (2), CPC). Appeals from appellate decrees will be entertained only if there is a substantial question of law that arises.
An interim injunction is a discretionary relief granted by the court of first instance, and the appellate court will ordinarily not interfere with the exercise of such discretion and substitute its own except where the discretion has been shown to have been exercised arbitrarily, capriciously or perversely or where the court had ignored the settled principles of law regulating grant or refusal of interim injunctions (Wander Ltd. & Anr v Antox India P. Ltd., 1990 (Supp) SCC 727). The appellate court exercises its jurisdiction if it is found that, prima facie, there has been a misconstruction of documents by the lower court (Ramdev Food Products (P) Ltd. v Arvindbhai Rambhai Patel & Ors, 2006 (8) SCC 726).
There are no fixed costs to be incurred by a party before filing a suit, as the cost depends entirely on the choice of legal representation.
Proceedings initiated are subject to payment of court fees based on the valuation of the suit. The fee payable is for each relief sought (injunction, damages, account of profits, etc), rates of which differs from state to state.
Courts have the discretion to award costs of litigation. It is the general practice of Indian courts that parties are asked to bear their own costs. In some patent infringement suits, the courts have imposed costs on the losing party (TEN XC Wireless Inc. & Anr. v Mobi Antenna Technologies (Shenzhen) Co. Ltd., 2012 (187) DLT 632 and F. Hoffmann-La Roche Ltd. & Anr. v Cipla Ltd., 2015 (225) DLT 391).
Mediation is a common way of settling an intellectual property dispute, both before and after the filing of a patent infringement law suit. Pre-litigation mediation is commonly used in disputes that involve complicated issues of fact and confidential information, such as in the case of Standard-Essential Patents. Mediation generally takes place before a mediator who is formally trained, and is usually conducted in mediation centres attached to courts.
Case law has also introduced the process of early neutral evaluation (ENE) as is practised in the United States to settle intellectual property law disputes (Bawa Masala Company v Bawa Masala Company Pvt. Ltd., 2007 (142) DLT 599).
Parties can also resolve patent infringement disputes through arbitration. However, the validity of a patent is not arbitrable, so a counterclaim of revocation has, necessarily, to be heard by a court.
An assignment is not valid unless it is in writing and the agreement between the parties concerned is reduced to the form of a document embodying all the terms and conditions governing their rights and obligations and duly executed (Section 68). An assignment that is not registered with the Patent Office is null and void and not enforceable in law (National Research Development Corp. v ABS Plastics Ltd., 2009 (163) DLT 177).
A patentee can assign a patent or a share in a patent. Any person who becomes entitled to a patent or to a share in a patent by assignment shall apply in writing to the controller for the registration of his or her title or, as the case may be, of notice of his or her interest (Section 69(1)).
An application for the registration of the title of any person becoming entitled by assignment to a patent or a share in a patent, may be made by the assignor or other party to the assignment, as the case may be (Section 69(2)).
The Controller shall, upon proof of title to his or her satisfaction, enter a notice of interest in the register, with particulars of the instrument, if any, creating it (Section 69(3)). Two copies of the assignment, or other document affecting the title to any patent, certified to be true copies by the applicant or his or her agent, shall be submitted to the Controller (Rule 91).
If there is no entry of the document recording the assignment in the register of patents, it shall not be admitted by the Controller or by any court as evidence of such assignment, unless the Controller or the court, direct otherwise by recording reasons to do so in writing (Section 69(5)).
The requirements or restrictions as applicable to assignment of patents, are applicable to licence agreements as well. Licence agreements shall not have restrictive conditions that will: (i) prohibit the licensee from acquiring (from any other person) or using any article, other than the patented article or an article other than that made by the patented process or using any process other than the patented process; (ii) provide for exclusive grant back, prevent challenges to validity of the patent & coercive package licensing. However, the licence agreement can have a condition prohibiting sale of goods other than those of a particular person and the licensor can reserve to himself or herself, or his or her nominee, the right to supply such new parts of the patented article as may be required or to put or keep it in repair.
The procedure for granting a licence to a patent is the same as is applicable to assignment of patents. If requested by the patentee or the licensee, the Controller will take steps for ensuring that the terms of the licence are not disclosed to any person except under the order of the court (Section 69(4)).
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Intellectual Property Rights
The significance of intellectual property can be traced to the ancient use of stamps on bricks by Roman brick-makers for the purpose of identification, and even before that when the leaders of the ancient Greek city of Sybaris granted monopoly for one year on cooking a delicious dish to its creator. Obviously, much has changed since then with the advancement of science and technology and global business.
Intellectual property is a product of human intellect and the rights granted on it allow its owner to benefit from the fruits of this intellectual endeavour by creating a monopoly over it. Such benefit is not always a natural right but requires recognition by a statute.
In India, intellectual property rights recognised under statute are:
Intellectual property rights (IPRs) play a key role in every sector and have become the basis for crucial investment decisions. IPRs are exclusive rights and therefore there is always a challenge to strike a balance between the interests of innovators and the interests of the society at large. Another important factor is having an adequate legal framework to protect the interests of innovators and inspire confidence that their intellectual property will be protected, in turn triggering further innovation.
IPR litigation in India is quite diverse owing to the large number of courts, varying degree of experience of the judicial officers in IPR matters and varying manners of practice. As a result, some courts have become preferred forums over others.
Most of the suits for infringement are filed in Delhi and Mumbai, especially in High Courts of these cities. Although these jurisdictions are preferred due to its courts' extensive experience and greater understanding of IPR matters, their large volume of cases are also attributable to the fact that Delhi is the capital of India and Mumbai is the country's economic capital. Thus, large volumes of commercial disputes are natural.
With the rapid growth of cases dealing with IPR laws – including patents, trade marks, copyrights and design laws – there has been a total number of 727 cases filed at the Delhi High Court and the Bombay High Court during the last year. Out of these, 531 cases related to trade marks, followed by copyrights (157), designs (14) and patents (42). There were approximately 532 cases in which ex parte injunctions were granted and there were 661 cases in which permanent injunctions were granted. Only 92 cases were settled in the last year.
The Indian Legislature established commercial courts in India by passing a new Act in 2015, which came into effect in 2016, with the objective of streamlining and expediting commercial lawsuits, including IP disputes. Under this act, commercial courts have been established at the district level and commercial divisions have also been established within High Courts having ordinary original civil jurisdiction. This new enactment has given a separate treatment to commercial cases, which include cases relating to intellectual property. Given the large volume and often tardy progress of cases, the new Act gives stringent timelines for different stages of a suit with almost no room for slow progress. Under the said Act, if any party feels that its opponent has no real prospect of succeeding in or defending a claim, and that recording evidence would be superﬂuous, then it may apply for a summary judgment. The endeavour is to hear and conclude oral arguments within six months of the time when the parties have ﬁnished reviewing all the documents. This procedure is meant to ensure the speedy disposal of suits.
Apart from changes in law to improve the speed of trials, the Government has taken initiatives for the training of judicial officers such that IPR matters are handled in an expedited manner. The Cell for IPR Promotion and Management (CIPAM), which is a government body, has been working in conjunction with WIPO and the National Judicial Academy, India (NJA) for organising training and sensitisation programmes on IPRs for High Court and district court judges. Two colloquiums on commercial laws for High Court judges were held at the National Judicial Academy of Bhopal. CIPAM, in association with NJA, included the discussion on intellectual property rights in the Colloquium on Commercial Laws for High Court Justices held in January 2017.
India is beginning to be recognised as a pro-innovator jurisdiction with courts having a greater understanding of IPR laws. Moreover, with a proper legal framework in place and no discrimination on the nationality of the entities asserting their IP rights, India has seen a manifold increase in the assertion of IP rights by innovators.
This is one side to the trends of litigation in India, especially for IPR matters. From the other side, the trend has been that once an ex parte injunction is granted, it takes a considerable amount of time to remove such injunction and also for the trial to conclude. Moreover, once an injunction is granted, the party in whose favour such injunction is granted tends to delay the proceedings and prolong the trial. As many as 9% of the cases have been completed more than 20 years after the date of the stay order. Approximately 21% of the cases have been completed more than ten years after the date of the stay order. As per the data available up to 2017, there are in excess of 3,000 cases that are still pending in different courts for a period of more than ten years.
In order to curb this misuse of the statutory right granted to the litigants, the Three Judges Bench of the Hon’ble Supreme Court in the landmark case of Asian Resurfacing of Road Agency Pvt. Ltd. and Ors. v Central Bureau of Investigation ((2018) 16 SCC 299) directed that in all pending cases where stay against proceedings of a civil or criminal trial is operating, the same will come to an end on expiry of six months, unless in an exceptional case by a speaking order such stay is extended. In cases where stay is granted in future, the same would end on expiry of six months from the day, unless in an exceptional case by a speaking order such stay is extended.
Courts in India, especially in IP matters, have recognised the importance of curtailing wilful infringement of IP rights and have been liberally granting punitive damages to the innovators. Although the amount of punitive damages granted by the courts is not very large, such damages are granted in addition to the real damages and act as a deterrent.
Thus, as can be seen from the above discussions, Indian litigation trends present a very balanced approach by the courts in IP matters. On one side, courts do not shy away from granting ex parte injunctions against infringers, and prolonged ex parte injunctions are also frowned upon. Moreover, with new laws in place, the time taken to complete a trial has been shortened significantly.