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Patent litigation in India and interim injunctions--an evolving jurisprudence.

INTRODUCTION

WITH THE ADVENT of pharmaceutical patent regime in 2005, it was expected that patent litigation in India would be an evolving area. Often, what has been seen is that the outcome of applications for interim injunction is determinative of the outcome of the litigation as a whole. However, the approach of courts in deciding on interim injunctions in patent cases has not been consistent. As a result, there has always been felt a need for the unswerving standards to be followed by the courts while deciding on interim injunctions in patent cases. The exercise of sound judicial wisdom by the court while deciding on interim injunction becomes even more important in view of the fact that a patent matter often involves complex technologies and huge amounts at stake.

The commentary on patent law, Patent Law, states that "What constitutes infringement of a patent is not defined in the Patents Act, 1970. One has, therefore, to gather the meaning of infringement from the scope of the monopoly rights conferred on the patentee; for infringement is the violation of those rights." (1)

Section 48 of the Patents Act, 1970 confers monopoly rights on the patentee. Infringement of a patent can be termed as the unauthorized making, using, offering for sale, selling of any patented invention within a jurisdiction, or importing into that jurisdiction of any patented invention during the term of that patent. The Patents Act, 1970, provides under Chapter XVIII provisions pertaining to "Suits Concerning Infringement of Patents". These provisions are covered under section 104 to section 115 of the act.

The above said commentary also states that "In deciding whether what the alleged infringer is doing amounts to an infringement of a particular patent three questions are involved: (1) the extent of monopoly right conferred by the patent which has to be ascertained by a construction of the specification; (2) whether the alleged acts amount to making, using, exercising, selling or distributing a product; or using or exercising a method or process in the case of a process patent; and (3) whether what the alleged infringer is doing amounts to an infringement of the monopoly conferred by the patent grant." (2)

This commentary also states that "To infringe a patent it must be shown that the invention as claimed in the relevant claim, has been infringed in all essential respects--essential that is to say, upon the true construction of the claims." (3)

The determination of patent infringement requires that the infringing product or process falls within one or more claims of the patent. The test of infringement involves reading a claim onto the technology of interest. A claim is said to read on the technology, if all of its elements are found in that technology.

Injunction is as an equitable remedy in the form of a court order, whereby a party is required to do, or to refrain from doing, certain acts. An injunction may be preliminary or permanent which are provided under Order XXXIX, Rule 1 & 2 of Indian Code of Civil Procedure (CPC), 1908.

Interim injunction being a remedy that prevents the violation of rights pending the trial of the suit; it requires sound judicial wisdom to be exercised by the courts while deciding upon an application for the grant of interim injunction.

In view of a number of legal pronouncements leading to a set of formal standards, there has evolved criteria in terms of three basic factors that a court should weigh while granting interim injunctions. These factors are: (i) Prima facie case, (ii) Irreparable damage and (iii) Balance of convenience.

The above mentioned first factor i.e. prima facie case that has led to different interpretations is a substantial question which requires the plaintiff to show that he has a good chance of success at a prima facie level. It also requires him to establish a prima facie case of validity of the patent in question apart from establishing a prima facie case of infringement of that patent. The second factor i.e. irreparable damage requires the plaintiff to show that irreparable injury would be caused to him in the event the interim injunction is denied by the court. The third and final factor i.e. balance of convenience requires the plaintiff to show that comparative hardship of inconvenience which is likely to ensue in the event the interim injunction is not granted will be greater than that would be likely to arise if the interim injunction is granted.

The origin of these factors may be sourced to 'celebrated' English decision in the case of American Cyanamid Co. vs. Ethicon Ltd., 1975 AC 396.

In this leading case, the House of Lords contemplated and laid down some principles on how the court's discretion to grant interim injunctions should be exercised. These principles consider:

* Whether there is a serious question to be tried on the substantive claim;

* Whether damages would be an adequate remedy for the claimant;

* Balance of convenience of each of the parties in the event an order is granted and

* Any special factors.

The House of Lords, while proposing a new standard of "triable issue" envisaged a flexible standard of prima facie assessment.

Although, the court is always expected to mull over all these factors before deciding on interim injunction, pending the suit, the sine qua non of interim injunctive relief is that the plaintiff must establish that the failure to grant an injunction would result in the likelihood of irreparable harm to his interests.

A number of judgments suggest that the factor of prima facie case is considered since there is an absence of presumptive validity of a patent as provided under section 13 (4) (4) of the Patents Act, 1970. We, however, observe that this particular section does not completely bar a presumption of validity and merely suggests that there is no warranty as to the validity of the patent. A close analysis of the section reveals that its application is confined to examination and investigations required under section 12 and 13 only and does not affect a patent which has been subjected to opposition proceedings.

Another principle evolved by way of caution that has often been considered by the courts while deciding on interim injunctions is the controversial "six year rule" (5). It states that if a patent is more than six years old and there has been undisturbed possession and enjoyment over it for such time, a stronger presumption of validity must be attached to it. This particular rule first applied in India in the case of Manicka Thevar vs. Star Plough Works, AIR 1965 MAD 327, has lost its significance over the years for lack of any basis for its application.

SOME LANDMARK PATENT LITIGATION CASES: VARIED APPROACH OF JUDICIARY IN DECIDING ON INTERIM INJUNCTIONS

A representative chart of significant patent infringement cases in India where interim injunction was decided is presented in Table 1.

In recent years, of a number of cases, the high profile case of Bajaj Auto Ltd. vs. TVS Motor Company Ltd. was most significant as the Supreme Court concurred with the observations made in Shree Vardhman Rice & Gen Mills vs. Amar Singh Chawalwala that matters relating to trademarks, copyrights and patents should be finally decided very expeditiously by the trial court instead of merely granting or refusing to grant injunction.

The Supreme Court held that in matters relating to trademarks, copyright and patents the proviso to Order XVII Rule 1(2) C.P.C. (6) should be strictly complied with by all the courts, and the hearing of the suit in such matters should proceed on day to day basis and the final judgment should be given normally within four months from the date of the filing of the suit. The court also directed that these directions be carried out by all courts and tribunals in this country punctually and faithfully.

Practically, the proposition laid down by Supreme Court seems a bit unfeasible and unrealistic in view of the existing framework. Nonetheless, these guidelines certainly have a wider significance for the speedy trial of high stake IP cases.

However, in order to make speedy trial of such cases a meaningful reality, the implementation of these guidelines would be equally important.

PATENT AND PUBLIC INTEREST: A TUG OF WAR

The most talked about decision having far reaching ramifications in the pharmaceutical patent arena in India has been the decision of Delhi High Court in F. Hoffmann-La Roche Ltd. and Anr. vs. Cipla Limited. [2008 (37) PTC 71 (Del.)]. In this case, the plaintiffs filed a suit praying for permanent injunction restraining defendant from infringing its patent in respect of anti-cancer drug "Tarceva".
Table 1: Landmark patent cases

S.No.     Case Details        Patented              Decision
                             Invention

1.     National Research   IN138571        * If the patent in
       Development         (Titanium       question is sufficiently
       Corporation of      substrate       old and has been worked,
       India, New Delhi    insoluble       the court would presume
       vs. The Delhi       anodef          the patent to be valid for
       Cloth and General   assembly for    the purpose of temporary
       Mills Co. Ltd. &    diaphragm type  injunction
       Ors. AIR 1980       chloral kali
       DEL132 (Delhi High  cells)
       Court)

                                           * Ex-parte interim
                                           injunction confirmed

2.     Surendra Lal        IN143964        * Invention does not
       Mahendra, New       (Laminating     involve novelty/inventive
       Delhi vs. M/s.      apparatus)      step
       Jain Glazers New
       Delhi & Ors. ILR
       1981 Delhi 257
       (Delhi High
       Court)

                                           * Ex-parte ad-Interim
                                           injunction granted earlier
                                           vacated

                                           * Status Quo to be
                                           maintained

3.     Jimmy Sorab         Sealing         * Ad-interim injunction
       Canteenwala & Anr.  device          granted by trial court
       vs. Shellco - AG                    allowed to continue
       1996 IPLR 357
       (Guj.) (Ahmedabad
       High Court)

4.     Franz Xaver Huemer  IN161520,       * Trial court's order
       vs. New Yash        IN162589,       vacating interim
       Engineers 1996      IN162369,       injunction confirmed
       (25) ARBLR 522      IN163591,
       Delhi (Delhi High   IN163095
       Court)              (Mechanical
                           devices)

                                           * Injunction refused, in
                                           equity, for non use of the
                                           pateAd-interimnt

5.     Hindustan Lever     IN170171        * Patented invention
       Limited. vs.        (Detergent      merely a rearrangement of
       Godrej Soaps        bars suitable   known devices and
       Limited. And        for personal    therefore not an invention
       Others AIR 1996     bathing or      under the Act
       Cal 367 (Calcutta   fabric
       High Court)         washing)

                                           * Interim injunction
                                           denied

6.     Standipack Private  Pouch for       * Plaintiff failed to act
       Limited & Anr. vs.  storage and     with clean hands rather
       Oswal Trading Co.   dispensing of   suppressed material facts
       Ltd. & Castrol      a liquid
       India Ltd. AIR
       2000 Delhi 23
       (Delhi High
       Court)

                                           * Provisions of the
                                           Patents Act, 1970 and
                                           Rules framed therein
                                           violated by post-dating
                                           patent

                                           * Interim Injunction
                                           granted by District Court
                                           vacated

7.     Cadila              IN183097        * Prima facie, the process
       Pharmaceuticals     (Novel drug     evolved by Cadila not
       vs. Instacare       delivery        patentable
       Laboratories Pvt.   process for a
       Ltd. 2001 (21) PTC  combination
       472 (Guj.)          medicine)
       (Ahmedabad High
       Court)

                                           * Defence to infringement
                                           action is always available
                                           to defendant regardless of
                                           his not availing the
                                           opportunity of filing
                                           pre-grant opposition or
                                           revocation petition

                                           * Trial Court's order
                                           vacating the ex-parte
                                           ad-interim injunction
                                           (granted to Cadila)
                                           affirmed

8.     Telemecanique &     Product range   * Once a violation is
       Controls (I) Ltd.   of electric     established in case of a
       vs. Schneider       contractors     registered patent, subject
       Electric            and             of course, to the patent
       Industries SA 94    accessories     being used, it will not be
       (2001) DLT 865                      permissible to contend
       (Delhi High                         that the said patentee is
       Court)                              not entitled to an
                                           injunction

                                           * Balance term of patent
                                           in question matters

                                           * Working of patents
                                           requirements (Section 83)
                                           met by the sale of the
                                           product in the country
                                           (though not manufactured
                                           but imported)

                                           * Order of single judge
                                           granting interim
                                           injunction confirmed

9.     Dhanpat Seth and    IN195917        * The single judge held
       Ors. vs. Nil Kamal  (Device of      that the statutory law
       Plastic Crates      manually        prevailing in India is
       Ltd. 2006 (33) PTC  hauling of      contrary to the rules laid
       330 (HP) (Himachal  agriculture     down in the American
       Pradesh High        produce)        Cyanamid case, on prima
       Court)                              facie presumption of
                                           validity of patent, in
                                           view of the section 13(4)
                                           of the Patents Act, 1970

                                           * Single judge's order
                                           denying temporary
                                           injunction confirmed in
                                           appeal before division
                                           bench

                                           * Division bench held that
                                           the device developed by
                                           the plaintiffs is in fact
                                           the result of traditional
                                           knowledge and
                                           aggregation/duplication of
                                           known products

10.    Bilcare Ltd vs.     IN197823        * Interim injunction
       Amartara Pvt. Ltd.  (Metallized     (granted by district
       (2007) (34) PTC     packaging       court) obtained by not
       419 (Del) (Delhi    films)          disclosing complete facts
       High Court)

                                           * In infringement suits,
                                           non disclosure,
                                           concealment of facts or
                                           improper disclosure would
                                           result in denial of the
                                           equitable relief of
                                           injunction

                                           * District court's order
                                           granting ex-parte
                                           ad-interim injunction
                                           vacated

11.    K Ramu vs. Adayar   IN200285;       * The object of the
       Ananda Bhavan and   IN193899 (Low   interlocutory injunction
       Muthulakshmi        glycemic        is to protect the
       Bhavan 2007 (34)    sweets;         plaintiff against injury
       PTC 689 (Madras     Process for     by violation of his right
       High Court)         preparation of  for which he could not be
                           low glycemic    adequately compensated in
                           sweets)         damages recoverable in the
                                           action if the uncertainty
                                           were resolved in his favor
                                           at the trial

                                           * Ad-Interim injunction
                                           granted

12.    FDC limited & Ors.  IN197822 (A     * The ex-parte injunction
       vs. Sanjeev         synergistic     can be granted only after
       Khanderwal & Ors.   antibacterial   proper judicial scrutiny
       2007 (35) PTC 436   formulation     and appreciation of
       (Mad) (Madras       and a method    elaborate oral and
       High Court)         of making the   documentary evidence
                           same)           adduced by both sides

                                           * Guidelines formulated on
                                           ex-parte injunctions:

                                           * Whether the plaintiff
                                           and the primary defendant
                                           are residing outside the
                                           State and their identity,
                                           addresses etc., are easily
                                           known;

                                           * Whether sales of the
                                           offending products are not
                                           on a commercial scale;

                                           * If the grant of interim
                                           injunction is going to
                                           result in closure of
                                           operations/business of the
                                           defendant. If the ex-parte
                                           injunction has a
                                           nationwide operation and
                                           is not just within the
                                           State;

                                           * Where the dispute
                                           involves patent/trade mark
                                           issues, the trial court
                                           should carefully peruse
                                           the certificates,
                                           offending marks etc;

                                           * An ex-parte injunction
                                           should not be granted in
                                           cases where no evidence of
                                           proof of infringement has
                                           been filed by the
                                           plaintiff; and

                                           * In patent cases, the
                                           trial court has to
                                           carefully note the
                                           distinction between a
                                           product patent and a
                                           process patent. If the
                                           plaintiff alleges
                                           violation of a process
                                           patent, then the ex-parte
                                           injunction should not be
                                           granted unless the
                                           plaintiff has adduced the
                                           evidence of an independent
                                           scientist/other technical
                                           expert who has tested the
                                           plaintiff's and
                                           defendant's product and
                                           arrived at an independent
                                           finding as to the identity
                                           of the processes used. In
                                           process patent cases,
                                           opportunity must be given
                                           to the defendant to
                                           explain how their process
                                           does not constitute
                                           infringement within the
                                           meaning of Section 104-A
                                           of the Patents Act, 1970

                                           * Ex-parte ad-interim
                                           injunction granted by the
                                           trial court suspended

13.    Acme Tele Power     IN197086;       * Interim injunction
       Limited vs. Lamda   IN197108        granted by district court
       Eastern             (Cubodial       confirmed
       Telecommunication   shaped green
       Ltd. 2008 (38) PTC  shelter and
       628 (Utt)           compact power
       (Uttrakhand High    interface)
       Court)

14.    BajajAuto Ltd. vs.  IN195904 (An    * Classic test for
       TVS Motor Company   improved        granting interim
       Ltd. 2008 (36) PTC  internal        injunction satisfied
       417 (Mad) (Madras   combustion
       High Court)         engine working
                           on a four
                           stroke
                           principle)

                                           * Bajaj has already come
                                           up in the world market by
                                           sale of its product; TVS
                                           has not even marketed its
                                           alleged product

                                           * The quantum of damages
                                           which the plaintiff may
                                           suffer in not granting
                                           injunction cannot be
                                           ascertained in monetary
                                           sense

                                           * Six year rule used to
                                           ascertain the validity of
                                           a patent affirmed

                                           * At the interim stage, it
                                           is sufficient for the
                                           plaintiff to show that the
                                           patent has prima facie
                                           novelty

                                           * The question of whether
                                           the patented invention is
                                           "obvious" will have to be
                                           decided in an appropriate
                                           manner in a full fledged
                                           trial

                                           * Interim injunction
                                           granted to Bajaj

                                           * Order of single judge
                                           set aside in appeal

                                           * Appeal preferred before
                                           Supreme Court

                                           * Supreme Court held that
                                           TVS shall be entitled to
                                           sell its product but it
                                           shall maintain accurate
                                           records/accounts of its
                                           all India and export
                                           sales

15.    J. Mitra & Co.      IN194638 (A     * The use of patent in
       Pvt. Ltd. vs.       device for      question being limited
       KesarMedicaments    detection of    (the early detection of
       2008 (36) PTC 568   antibodies to   HCV was stated to be
       Del (Delhi High     hepatitis       critical as no vaccine for
       Court)              virus in human  the same present), the
                           serum and       factors of irretrievable
                           plasma)         prejudice and balance of
                                           convenience lie in favor
                                           of the plaintiff

                                           * Temporary injunction
                                           granted

16.    Mariappan vs.       IN198079        * The artificial banana
       A.R.Safiullah 2008  (Food-grade     leaf (food-grade laminated
       (38) PTC 341        laminated       paper) prima facie appears
       (Mad) (Madras       paper, method   to be of not an invention
       High Court)         and apparatus   but can be termed only as
                           for             an innovation
                           manufacturing
                           the laminated
                           paper)

                                           * In terms of Section
                                           13(4) of the Patents Act,
                                           the grant of patent itself
                                           cannot be deemed to be
                                           prima facie case on the
                                           side of the patentee

                                           * The controversial six
                                           year rule disregarded for
                                           it has lost its
                                           significance in view of
                                           the latest development in
                                           the field of science and
                                           technology

                                           * Single judge's order of
                                           denial of ad-interim
                                           injunction confirmed

17.    Strix Limited vs.   IN192511        * In order to raise a
       Maharaja            (Liquid         credible challenge to the
       Appliances Limited  heating         validity of a patent, even
       MANU/ DE/2174/2009  vessels)        at an interlocutory stage,
       (Delhi High                         the defendant will have to
       Court)                              place on record some
                                           acceptable scientific
                                           material, supported or
                                           explained by the evidence
                                           of an expert, that the
                                           plaintiff's patent is
                                           prima facie vulnerable to
                                           revocation

                                           * The burden on the
                                           defendant to show that it
                                           has put forward a
                                           creditable challenge will
                                           be greater if there was no
                                           opposition (pre-grant or
                                           post-grant) filed to the
                                           patent

                                           * Interim injunction
                                           granted



The case acquired significance for the very reason that it was the first case in which the court considered the aspect of "pricing" of the drug in deciding on the interim injunction. This case was also important as it diluted the six year rule.

This case was yet another instance reflecting the sheer inability of judiciary to effectively handle patent matters involving a number of complex issues. In this case, public interest factor was one of the predominant factors that the court took into account while denying Roche the interim injunction.

The single judge of the high court laid down several crucial principles as follows:

i. In patent infringement actions, the courts should follow the approach indicated in American Cyanamid case, by applying all factors;

ii. The courts should follow a rule of caution, and not always presume that patents are valid, especially if the defendant challenges it and

iii. The standard applicable for a defendant challenging the patent is whether it is a genuine one, as opposed to a vexatious defense. Only in the case of the former will the court hold that the defendant has an arguable case.

The court, taking a prima facie view on the situation on hand, opined that Roche's case though arguable and disclosing prima facie merit, it has to answer a credible challenge to the patent raised by the defendant Cipla. The court opined that in such a situation the question of balance of convenience will have to be decided. The court was of the view that while deciding the issue of balance of convenience; it has to consider the following factors:

The court was of the opinion that as between the two competing public interests, i.e. the public interest in granting an injunction to the patentee, as opposed to the public interest in access to a life saving drug for the people, the balance has to be tilted in favor of the latter. The court also opined that the patients in India can ill-afford high priced imported versions of the drug like "Tarceva". (7)

Aggrieved by the ruling of the single judge, Roche went in appeal. However, the Division Bench dismissed the appeal imposing heavy costs quantified at Rs. 5 Lakhs to be paid by Roche to Cipla. The court however, restrained Cipla from exporting its drug to countries where Roche had a patent during the pendency of the appeal.

The contention of Cipla was that the X-ray diffraction data of Roche's patented drug "Tarceva" showed that it corresponded to polymorph B for which Roche did not have a patent as the patent in suit pertained to polymorph A+B only. Cipla contended that Roche was seeking an interim injunction in respect of a drug corresponding to polymorph B which was not covered under a patent as a separate application for polymorph B (8) was pending consideration before the patent office.

The division bench held that Roche failed to establish a prima facie case in its favor in view of the fact that a serious challenge to the validity of the patent in suit was raised. It was also held that Roche failed to make a full disclosure of the facts

* The extent to which disadvantages to each party would be incapable of being compensated in damages in the event of his succeeding at the trial;

* The nature of the product and its use;

* The timing of the action and

* If the balance is approximately equal, the court may consider the relative strength of each party's case only where it is apparent by undisputed evidence that the strength of one party's case is disproportionate to that of the other party. pertaining to the patent in suit including the fact that there was another patent application pending in respect of Polymorph B in which Roche had stated that "polymorph B is claimed to be thermodynamically more stable and it helps in providing improved oral dosage in solid form". It was also held that Roche ought to have filed X-ray diffraction data of "Tarceva" and "Erlocip" along with the plaint.

The division bench held that to the extent that Cipla has raised a serious doubt whether Roche in fact holds a patent for the product sold in the tablet form as "Tarceva", Roche must be held not to have been able to cross the first hurdle of showing that it has a prima facie case in its favor.

Moreover, the division bench concurred with the single judge on the public interest factor. However, it laid emphasis on greater availability of a life saving drug by stating that even if the price of Cipla's drug "Erlocip" at ~USD 32.53 (INR 1600) per tablet does not make it inexpensive, the question of greater availability of such drug in the market assumes significance.

While dismissing the appeal, the court getting overtly optimistic formulated the following principle which may have its own implications in a pharmaceutical patent litigation:
  "In an application seeking ad interim injunction in a suit for
  infringement of patent, it would be incumbent on the plaintiffs to
  make a full disclosure of the complete specification of the product
  whose patent is claimed to have been infringed. The plaintiffs will
  also have to disclose to court the x-ray diffraction data of the
  product, particularly if it is a pharmaceutical drug. The plaintiffs
  have to make an unequivocal disclosure that the patent they hold
  covers the drug in question; whether there are any other pending
  applications seeking the grant of patent in respect of any
  derivatives or forms of the product for which they already hold a
  patent and the effect of such applications on the suit patent."


The decision in this high profile case has drawn mixed reactions in India. The decision of the single judge was particularly unappreciated for some very apparent reasons. It was observed that the public interest factor discussed in the decision permeated all other relevant factors thereby leaving a too little scope for a balanced approach required from the court in deciding on interim injunction in such a complex matter. It was also observed that the court was not expected to transgress into the domain of the executive for trading into the area of pricing of drugs as it would be violative of Doctrine of Separation of Power (9). There has also been fear that infringers may misuse this over-emphasized principle of public interest to serve their private interests.

The court failed to appreciate that the issue of "affordability" of the drugs is altogether irrelevant as enough safeguards are already present in the substantive law i.e. Patents Act, 1970 to protect the "public interest" requirement. It may be noted that one of the established executive agency National Pharmaceutical Pricing Authority, a part of the Ministry of Chemicals and Fertilizers under the Drug Price Control Order has adequate power to monitor the price of drugs. The court also failed to appreciate that patented drug "Tarceva" was not the unique anti-cancer drug to treat lung and pancreatic cancer as several other cancer drugs were also available in the market.

Moreover, the division bench failed to appreciate that a patent infringement case involves claim construction/interpretation as perhaps it did not analyze the independent claim of the patent in suit. Awarding whopping costs of ~USD 10,165.63 (INR 5 Lakhs) could also never be justified in view of the fact that (i) it was the stage of interim injunction only when the ruling came and (ii) this case involved several contentious issues yet to be decided by the court requiring a full fledged trial.

The outcome of the judgment in this case has really been alarming since it opened floodgates to more and more infringers to infringe the patent in suit in question. It has compelled Roche to file nine more lawsuits (10) against different infringers till date in respect of the same patent in question out of which seven suits (except Roche vs. Matrix Lab and Roche vs. Intas Biopharmaceuticals) are pending before the Delhi High Court. It has also been seen that the judgment in this particular case has had a substantial impact on Roche's other cases also which are pending before the Delhi High Court.

Importantly, in one of these suits i.e. F.Hoffmann-La Roche Ltd. and Anr. vs. Natco Pharma [CS (OS) 2465/2009] almost six months have elapsed since the high court reserved its order on the interim injunction application filed by Roche.

Roche, however, was able to get an interim in-junction from the Madras High Court in another suit [CS (OS) 801/2010] filed in respect of the same patent. The court granted interim injunction after taking a note of elaborate laboratory research in-volved behind the patented invention of Roche.

PATENT LINKAGE

In Bristol-Myers Squibb Company & Ors. vs. Dr. B. P. S. Reddy & Ors. [Suit no. CS (OS) 2680/2008], a suit filed for the permanent injunction restraining the defendant from infringing the patent IN203937 in respect of the drug "Dasatinib", the Delhi High Court granted an ex-parte ad-interim injunction (11) in favor of the plaintiffs restraining the defendants from manufacturing, selling, distributing, advertising, exporting, offering for sale or in any manner dealing directly or indirectly in any infringing product.

The court, in an unusual event, directed the Drug Controller General of India (DCGI) to not allow any party to infringe any laws. The court also directed the DCGI not to grant the approval of the alleged drug to the defendants, if the drug is in breach of the patent of the plaintiffs. Moreover, the plaintiffs were asked to make a representation to DCGI making out a case for the alleged drug being in breach/violation of the patent of the plaintiffs.

There was a similar decision (12) of the Delhi High Court in another patent infringement suit Bristol-Myers Squibb Company & Ors. vs. Mr. J. D. Joshi & Anr. [CS (OS) 2303/2009] filed by BMS in respect of the same patent IN203937.

There was a significant backlash against the decision as it contemplated to provide for "patent linkage" even though there is no provision under the Drugs and Cosmetics Act, 1940 and Rules 1945 for the same. The controversy surrounding patent linkage finally ended in Bayer Corporation & Anr. vs. UOI&Ors. case where the Supreme Court dismissed the Special Leave Petition [SLP(c) No. 6540/2010] filed by Bayer arising out of Bayer's case before the Delhi High Court seeking a direction from the Court to restrain the DCGI from granting marketing approval to the alleged generic drug "Soranib" of Cipla which would infringe Bayer's patent.

RE-EMERGENCE OF PUBLIC INTEREST FACTOR

In Bristol-Myers Squibb Company & Anr. vs. Ramesh Adige & Anr. [Suit no. CS (OS) 534/2010], a suit filed for the permanent injunction restraining the defendant from infringing the patent IN213457 in respect of the drug "Baraclude", the Delhi High Court refused to grant the interim injunction to Bristol-Myers Squibb (BMS) on the ground that patent in suit is a product by process patent and not a pure product patent. It was also held that since BMS failed to bring out the necessary comparative efficacy data in respect of the claimed low dose of "Entecavir" (API of Baraclude) to meet the requirements of section 3(d) of the Patents Act, 1970, the patent in suit should not have been granted and becomes vulnerable. It was held that the defendants, by raising a credible challenge to the patent in suit, have tentatively shown that the patent has been rendered vulnerable.

The court relied on the judgment passed in Novartis AG and Anr. vs. Mehar Pharma and Anr., 2005(30) PTC 160 Bom, in which the Bombay High Court, while denying the plaintiff interim injunction expressed its concerns for public health.

The Delhi High Court held that since hepatitis B is a chronic infection and its prevalence in India is not in dispute, its medication ought to be easily available and accessible to the patients across the country. It was held that plaintiffs (BMS) are not entitled to interim injunction in view of the fact that plaintiffs import the patented drug "Bamclude" and do not manufacture it locally and the price of this drug is almost three times higher than the defendants' product.

Aggrieved by the ruling of the single judge, BMS went in appeal before the division bench. The division bench, however, disposed off the appeal by directing the expedited trial of the suit.

The decision of the single bench holding the patent in suit as a product by process patent was not appreciated as being fundamentally incorrect on account of the fact that the claims of the patent in suit show that it is a product patent, and not a product by process one.

NEED TO ELIMINATE INTERIM INJUNCTIONS

Another worth discussing decision is seen in the case of Bayer Corporation & Anr. vs. Cipla Ltd., [CS (OS) 523/2010] pending before the Delhi High Court. Bayer filed the suit for permanent injunction restraining Cipla from infringing its patent IN215758 in respect of the anti-cancer drug "Nexavar" (Sorafenib). This drug was also the subject of controversial patent linkage case Bayer Corporation & Anr. vs. UOI & Ors.

The present suit is being seen as a trend setter in Indian patent litigation arena in view of the fact that the Delhi High Court, which is increasingly being recognized as most IP-savvy Indian court, in a significant departure from the standard practice in Indian patent trials had ordered that instead of disposing off the interim injunction application, the present suit be expedited directly to trial and to that effect, also appointed two scientific advisors under section 115 of the Patents Act, 1970, to give their opinion on terms of reference settled with the consent of both Bayer and Cipla. The appointed scientific advisors will be subject to cross-examination by either party. These scientific advisors who specialize in chemistry and life-science have submitted their reports before the court.

The judicial innovation of directing the matter straightaway to trial surfaced perhaps because normally it takes more than six months for the court to decide on the interim injunction application filed by the plaintiffs. It is expected that a rapidly scheduled full trial will be far better and productive in resolving the issues between both parties.

However, the overall progress in this matter does not seem to reap the benefits of not having the interim injunction application disposed off first as the matter is yet to witness some typical procedures followed in a trial like admission/denial, recording of evidence etc.

In an interesting development there is one more patent infringement lawsuit [No. CS(OS) 1090/2011] pending before a different judge of the Delhi High Court between Bayer Corporation and Natco Pharma Ltd. in respect of the same patent. In this case the high court has adjourned the hearing on Bayer's application for interim injunction against Natco until the controller of patents renders a decision on the application for compulsory license filed by Natco on the subject patent before the patent office.

This is yet another instance where more than one patent infringement suit in respect of the same patent is pending before two different judges of the same high court. In view of these two pending patent cases, it becomes apparent that there is also a need to have a congruous and consistent patent litigation system in place so as to avoid the potential ramifications of having contradictory findings from two different judges of the same court on the validity of the same patent.

IMPLICATIONS FOR THE MARKET

Interim injunctions being important instruments if decided incorrectly cause enormous losses to both competitors and consumers. Although the Indian legal framework has improved yet the Intellectual Property enforcement in India is quite weak. Following some recent patent cases like Roche vs. Cipla where interim injunction was denied, there is a perceptible sense of fright among the global pharmaceutical companies towards the enforceability of their patent rights in India.

The annual report for the year 2009-10 published by controller general of patents, designs & trademarks mentions that the trend of filing of patent applications during 2009-10 witnessed a 6.8% decrease as compared to previous year possibly due to global economic crisis. However, some of the leading patent practitioners observe that there appears to be emerging a correlation between frightening IP ecosystem and a sharp decrease in the trend of filing patent applications in India.

The total number of applications for patents filed in 2009-10 was 34,287 as compared to 36,812 applications filed in 2008-09. This decrease was primarily attributed to a sharp fall in filing from foreign applicants who have been the major filers in previous years.

It cannot be denied that unless the rights of the patentees, acting in good faith, are respected in India, it will go on to hamper the attractiveness of India as a potential market and R&D destination.

PROBLEMS

As discussed hereinabove, patent disputes require both technical as well as legal expertise on part of the adjudicatory body like the courts. Very often it has been seen that patent matters take a very long time to be finally decided by the over-burdened higher courts. Another possible associated reason for this is an un-streamlined procedural system for frequent change in roster of sitting of judges of high courts thereby disrupting the momentum of hearing in a particular patent dispute. Considering the fact that the patent litigation is generally expensive, uncertain and risky affair, the slow pace of the law (13) and court's jitteryness while dealing with patent disputes, may not be conducive for the progress of the technology involved behind the patent.

SUGGESTIONS

Some of the suggestions for restructuring policy to overcome the problems discussed hereinbefore are highlighted as below:

* Eliminate the relief of temporary injunction and let the matter move directly to the trial stage, where the case involves a complicated and evenly poised patent dispute;

* Expedite the trials with minimal adjournment requests allowed;

* Provide a practical framework of procedural law with less technicalities and necessary flexibility;

* Ensure a congruous and consistent patent litigation system to avoid duplication and contradiction of events;

* Establish specialized intellectual property courts with specialized judges equipped with technical expertise and/or reinforce the legal competence of the intellectual property appellate board;

* Avoid the possibility of conflicting decisions by postponing the trial until any post grant opposition and/ or revocation proceedings against the subject patent are concluded and

* Appropriately make use of the services of the scientific advisors empanelled under section 115 of the Patents Act, 1970.

CONCLUSION

The landscape of judicial decisions unequivocally tends to prove that interim injunctions are granted very rarely and often tend to delay the speedy progress of the patent infringement lawsuit. As a result there has been felt a need for dispensing with the interim injunction phase and moving to the trial stage directly in view of the fact that the Indian Courts are relatively inexperienced in handling complex patent disputes.

Very often it has been seen that unless the patent in suit is an unscathed one; the patentee will find it extremely hard to get an interim injunction against the infringers. Another crucial factor that has an impact on the possibility of granting interim injunction is whether the infringing product has yet to be launched. The landscape of patent litigation also suggests that there is a need to recognize the importance of quality of patents that reflects the enforceability of patents in a litigation proceeding.

It is by and large expected that the coming few years will be vital as the Indian patent litigation arena has yet to see a reflection of the judicial application of the tenets governing the grant of an interim injunction.

Received: October 62011, revised October 302011

(1.) P. Narayanan, (Patent Law), 4th Edn, 2006, Eastern Law House, Page-498

(2.) Ibid, Page-499

(3.) Ibid, Page-526

(4.) Section 13(4) reads as: The examination and investigations required under section 12 (Examination of application) and this section shall not be deemed in any way to warrant the validity of any patent, and no liability shall be incurred by the Central Government or any officer thereof by reason of, or in connection with, any such examination or investigation or any report or other proceedings consequent thereon

(5.) English commentary--Terrell on the Law of Patents, Ninth Edition is considered to be the authority for the origin of the "six year rule".

(6.) Order XVII Rule 1(2) CPC: Costs of adjournment

(7.) The court while hearing the case noted that the plaintiff's capsule costs ~USD 97.58 (INR. 4, 800/-) and the equivalent tablet of the defendant costs ~USD 32.53 (INR. 1, 600/-).

(8.) The application for polymorph B (IN/PCT/2002/507/DEL) was ultimately allowed with process claims only.

(9.) The doctrine of separation of powers refers to the separation of the legislature, the executive and the judiciary.

(10.) The names of defendants in nine other patent infringement lawsuits filed by Roche are as follows: (i) Natco Pharma Limited; (ii) Reddy's Laboratories Ltd.; (iii) Glenmark Pharmaceuticals Ltd.; (iv) Matrix Laboratories; (v) Intas Biopharmaceuticals; (vi) Innova Life Sciences Pvt. Ltd., (vii) Accura Care Pharmaceuticals Pvt. Ltd., (viii) Oncare Life Sciences and (ix) Aureate Healthcare Pvt. Ltd..

(11.) This is an unreported decision.

(12.) This is an unreported decision.

(13.) There is a well known legal principle that "law should take its own course".

Rajashree Sharma is a Patent Attorney is the Head of Biotech Patents practice in Corporate Law Group, a New Delhi based IP law firm. She holds a Master's degree in Life Science. Prior to her current practice, she taught Genetics and Molecular Biology in Gauhati University, Assam. She has also worked as a senior research officer for 14 years with the Ministry of Environment & Forests, Government of Assam. She has made considerable contribution to the field of environmental biotechnology and has several studies to her credit sponsored by reputed institutes. She also has to her credit a number of papers/articles on Biosimilars published in National and International journals. She is currently a member of LES.

Dinesh Kumar Sharma is a registered Indian Patent Agent. He is an associate in Corporate law Group. He holds a Master's degree in organic chemistry. He has worked with several leading organizations like Jubilant Chemsys, Lakshmi Kumaran & Sridharan and Council of Scientific and Industrial Research ('CSIR'). His areas of practice include filing and prosecution of patent applications, patent litigation, opinion work etc. His practice focuses primarily on chemical patents.

Correspondence: Rajashree Sharma, Corporate Law Group, New Delhi, India. E-mail: rajashreesharma@clgindia.com
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Title Annotation:Original Article
Author:Sharma, Rajashree; Sharma, Dinesh Kumar
Publication:Journal of Commercial Biotechnology
Article Type:Report
Geographic Code:9INDI
Date:Jan 1, 2012
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