Monthly Archives: October 2014

PATENTS IN THE FIELD OF OUTER SPACE

An Indian space craft successfully entered Mars’ orbit, marking it as the first interplanetary mission for the country making India in the processof being the first Asian nation to reach the Red Planet— and the first nation in the world to successfully reach Mars on its first attempt.This post is devoted to raise awareness about the patent laws related to outer space.

Introduction

As we all know patentsare granted by state or national governments to inventors.Patents are territorial and are only enforced within the jurisdiction of the granting government. For example, holder of a U.S. patent may only be able to enforce the patent against someone who is using, making, sellingor importing the patented invention within the United States. Hence, the owner of the invention must file a separate patent application in countries of his interest, i.e where he wishes to obtain exclusive rights to his invention.

Above limitation in implementing rights granted by patents raises a pertinent question while discussing patents in space domain  –whose territory is space?

Laws pertaining to outer space

In this context it will be worthwhile to examine laws concerning outer space.

Space law can be described as an area of the laws governing activities in outer space that are applicable to national and international law. International lawyers have been unable to agree on a uniform definition of the term “outer space”, although most lawyers agree that outer space generally begins at the lowest altitude above sea level at which objects can orbit the Earth, approximately 100 km (60 mi).

Outer Space Treaty

The Outer Space Treaty, formally known as the Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, Moon and Other Celestial Bodies. It is a treaty that forms the basis of international space law. The treaty was opened for signature in the USA, the UK, and the Soviet Union on 27 January 1967, and entered into force on 10 October 1967. 102 countries are parties to the treaty, as of May 2013, while another 27 have signed the treaty but have not completed ratification.

Responsibility for Activities in Space

Article VI of the Outer Space Treaty deals with international responsibility, stating that “the activities of non-governmental entities in outer space, including the Moon and other celestial bodies, shall require authorization and continuing supervision by the appropriate State Party to the Treaty” and that States Parties shall bear international responsibility for national space activities whether carried out by governmental or non-governmental entities.

Sovereignty in Outer Space

On 20 December 1961, the United Nation passed a resolution 1721 as follows;

(a) International law, including the charter of the United Nations, applies to outer space and celestial bodies,

(b) outer space and celestial bodies are free for exploration and use by all States in conformity with international law and are not subject to national appropriation.

Article II of the Outer space Treaty states “outer space, including the Moon and other celestial bodies, is not subject to national appropriation by claim of sovereignty, by means of use or occupation, or by any other means”. Hence outer space is not subject to sovereignty of any state. It is regarded as a “Res Communis”, that is it is a public domain or public property.No one nation may claim ownership of outer space or any celestial body. So, outer space is not owned or controlled by anyone and it is available for anyone to use for any purpose. This does not mean that States that areexploring and using outer space cannot exercise any degree of authority.

As far as an object launched into outer space is concerned, in accordance with Article VIII of the Outer Space Treaty, the State on whose registry such an object is carried shall retain jurisdiction and control over that object, and over any personnel thereof.

Importance of IPR in Space Regime

Space technology has been for a long time one of the most advanced technical areas, and outer space activities are, in fact, the fruit of intellectual creations, it is only in recent years that intellectual property in the field of space activitiesis raised.

The reason is that:

  • Space activities are increasingly now shifting from being state owned to private and commercial activities
  • An increasing number of space activities are operated under international cooperation schemes, which depend on a simple, uniform and reliable international legal framework

Intellectual property protection is critical to fostering innovation in space research and exploration. Without protection, inventors would not reap the full benefits of their inventions and would in turn focus less on research and development.

Case Study: International Space Station (ISS)

The International Space Station (ISS) is a space station, or a habitable artificial satellite, in low Earth orbit. It is a modular structure whose first component was launched in 1998.

As the International Space Station nears completion, the issue of Space-related Intellectual Property Rights (SIPRs) is becoming increasingly important. The partners in this adventure, the USA, Russia, Japan, Canada and the Member States of European Space Agency (ESA), are working together to establish a legal framework to define the rights and obligations of each of the partner states, as well as their jurisdiction and control over their ISS elements.

Experiments to be carried out on the ISS cover human physiology, biology, biotechnology, medicine, biology, science and technology. The pharmaceutical sector in particular has been identified as an area that will benefit from experiments carried out on the ISS.

These factors raise the question of which laws apply to such experiments? For instance, if a scientist/astronaut invents a medical treatment while on board the ISS, which patent law can be used to protect it? Also, can the use of patented inventions be protected in outer space?

The complexity of the legal regime concerning IPRs for the ISS lies in the fact that the ISS consists of different modules provided by different partners. Different IP laws from different ISS Partners can coexist; as each partner registers their flight elements and retains jurisdiction, control and ownership over them.

In order to protect the exclusive rights of inventors, intergovernmental agreement on the ISS was signed on 29 September 1988 by the United States of America, Japan, Canada and ten other member states.

Article 21 of the International Space Station Intergovernmental Agreement (IGA) recognises the jurisdiction of each partner’s courts and allows for national laws to be applied in the modules belonging to the partners. This means that the different IP laws of each partner have to coexist, that is in the event an invention occurs on the Space Station, ownershipof invention will be determined by the ownership and registry of the Station’s element in which the invention has taken place.

For instance, if an invention is realised in a USA space element the USA Patent Act will be applicable as the invention is deemed to have occurred on US territory or for example, an invention made on a Japanese Element will be deemed to have occurred in Japan.

An invention created by an enterprise astronaut on ISS will be patented in the nation that has jurisdiction over the module where the invention took place, not the nation of the inventor.

105 of 35 U.S.C. (Inventions in Outer Space)

The USA is the only country that has enacted an explicit provision related to inventions in outer space.

The USA Patent Act (re. 35 U.S.C.§ 105(2003)) states that any invention made, used or sold in outer space on board a spacecraft that is under the jurisdiction or control of the USA is considered to be made, used or sold on US territory, except where an international agreement has been concluded that states otherwise.

Apart from the USA, however, only Germany modified its patent law prior to the signing of an Intergovernmental Agreement (IGA) on the ISS, to ensure that its patent law can be applied to inventions created on board an ESA registered module.

Apart from these two countries, the national patent laws of no other country contain provisions that would make national patent law applicable on board a spacecraft.

Space Legislation in India

India, like most other countries, has no provisions related to space legislation.

India is a party to all international space treaties, which form the main body of international space law. India has also played a significant role to adopt legal principles by the U.N. General Assembly Resolutions, which provide for the application of international law and promotion of international cooperation and understanding in space activities.

Thus it is for the Parliament of India to take the starting step in the direction of enacting a law for India for the purpose of the effective regulation of various aspects of India’s space policy. Because of recent national and global developments, active involvement of the private sector in country’s space programme, commercialisation of space activities and the agreements made nationally and globally with various agencies, governments, international and intergovernmental organisations, there is a huge need of space laws in India.

The second most important reason for a space law in India is that having successfully demonstrated their implicational capabilitiesnow the Indian space activities have become vastly diversified and have come to stay. Hence to facilitate inter-departmental coordination it is important to make legal norm related to space inventions.

Thirdly, there is a need to clarify applicable legal norms and rules relating to both public laws and private law aspects of space activities, as demonstrated by the experience of developed countries like USA and Germany.

Fourthly commercialisation of the space products is establishing and a vast space activities and space market where India plans to and has already begun to sell its space products.

Therefore, there is need for India to enact a National Space Legislation as soon as possible.

Conclusion

Space provides sufficient opportunities for many joint venture programmes for various innovative applications towards the cause of human kind. A harmonized system of IPR regime for the outer space is needed. The harmonized system should take into account the interests of developing countries and promote moral and ethical usage of Outer Space for the benefit of the entire humanity.

About the Author: Ms Harsha Rohatgi, Patent Associate, Khurana & Khurana, Advocates and IP Attorneys and can be reached at: harsha@khuranaandkhurana.com

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Practice of Patent Asserting Entities: Boon or Bane: Global Innovations

Introduction

Patent troll relates to a person or company that enforces its patents against one or more alleged infringers in an opportunistic and unduly aggressive manner, often with no intention to manufacture or market the patented invention. Various terms such as patent trolls, patent monetization companies, or patent assertion entities are used for such entities; however, irrespective of term used, it solely talks about companies that conduct very little research to create new ideas and produces no products. Instead, they hold patents in which they were not involved at any level: ranging from designing, manufacturing or process associated with that patent. Their main aim is to sue similar patent holder firms or to extract license payments under the threat of lawsuits or actual litigation to enforce their demands.

A more polite and neutral name used for them is “Non-Practicing Entities” (NPE’s). Non-practicing entities include legitimate institutions such as start-ups, technology transfer agencies, universities, research organizations inter alia.

Modus Operandi of patent trolls

Patent trolls usually gather together large portfolios of patents, which they purchase from companies that are going out of business, from firms that have developed technology that they don’t intend to pursue on a particular technology, or from individuals who are lacking funds to develop their inventions or ideas. Further, the trolls look for successful products that use the technology covered by their patents and demand a licensing fee. Because patent suits are expensive to defend, the target company is most often willing to settle out of court.

Trolls accumulate patents related to a target company. By purchasing many patents focused on one area, they are able to bring up so many occasions of possible infringement which further makes it harder and more expensive for the target company to defend the suit. They also sue multiple defendants so that the legal cost per defendant is reduced but makes for a large overall potential payback.

On the other hand, as a matter of practice, lawyers are paid on a contingency basis – they are only paid if they win the case. That reduces the cost further of the  trolls. On the other hand cost for the accused infringer is sky-high and if they try to fight the case, there is no quick way to end the litigation and achieve success in the litigation.

The patent trolls may also claim a share in total revenue from the product although patents may cover only a small aspect of the technology. The award can amount to millions for a successful product.

From various sources, it is believed that 97 percent of infringement suits in U.S. are settled before trial rather than risk judgement irrespective of the merits of the case and also the cost of patent litigation (bringing or defending a patent lawsuit is expensive, with legal costs and lawyers’ fees reaching into the millions of dollars) works to patent trolls advantage, too. Further adding to the list of advantages for trolls, if a defendant company loses a suit, it may be liable for treble damages in a case of wilful infringement.

The result is a situation where the accused infringer faces so much of a burden of fighting the court case that it becomes appealing to pay some lesser amount to make the litigation go away.

Patent Trolling in India

The practice of patent trolling was prevalent and practiced in India in the Information Technology and Communications sector till 2005 prior to passage and enactment of the Patents (Amendment) Act, 2005 after which there was steep decline in trolling activities.  The reason for this decline is nothing but the inclusion in the 2005 Act of a list of non-patentable subject matter which includes Software domain which is considered to be most significant domain involved in patent trolling among others, imposition of stringent deadlines for pre-grant opposition, introduction of post-grant opposition, as well as the introduction of a variety of other provisions such as compulsory licensing.

Pertinently patent law in India do not aims to prohibit the existence of patent trolls but threatens its existence.  For instance, Indian patent law makes it mandatory that a (granted) patent be worked or used in India. However otherwise, if a patent is not used in the territory of India within a period of 3 years from the grant of patent, compulsory licensing might be invoked.  Also, the Indian Patents Act makes it mandatory to file statement of working of a patent at the end of each financial year. And if the patent holders fail to file such a statement, he may be liable for a fine and/or imprisonment.  Hence in India, patent trolling does not pose any major threat to any entity seeking opportunity to enter the Indian market in view of the amendments to the laws which fairly controls the patent troll activity in India.

Conclusion:

While patent trolls are a major threat in many countries they are not a viable option to operate in India In view of provisions incorporated in Indian Patent Laws vide Patents (Amendment) Act, 2005.  It can be observed that while the other countries are plagued with patent troll activities, the Indian system strived fairly to control the problem of patent trolls.  May be US and other developed countries need to take a leaf out of Indian Patent Laws to curb the menace of patent trolls instead of criticising IPR regime.

About the Author: Mr Sitanshu Singh, Patent Associate, Khurana & Khurana, Advocates and IP Attorneys and can be reached at: sitanshu@khuranaandkhurana.com

Emcure’s Notice of Motion succeeds against Corona Remedies: Bombay High Court

In the recent decision of Bombay High Court in the case of Emcure Pharmaceuticals v Corona Remedies, the Hon’ble court decided on the issue of deceptive similarity, acquiescence and balance of Convenience in favor of Emcure Pharmaceuticals.

Facts of the case:

The plaintiff’s trademarks ‘OROFER’ and ‘OROFER XT’ are registered as word marks since 1996 with the trade mark registry in class 5 in relation to medicinal and pharmaceuticals preparations for iron  deficiency, anaemia, methylcobalmin deficiency, folic acid deficiency, zinc deficiency and so forth.

On, 10 January 2006 the plaintiff became aware of the advertisement of the defendant’s trade mark ‘COROFER’ in the Trade mark Journal 1371. However on 17th December 2007, Plaintiff sent Cease and Desist notice to the Defendant through their attorneys. Thereafter the Defendant’s registration was opposed by the plaintiff on 20th December 2007 claiming inter alia prior and original adopter of the mark ‘OROFER’ in class 5 and due to prolonged and extensive use, the mark exclusively connotes to the plaintiff only and would cause confusion and deception among potentials if used by any other entity.

The plaintiff also sent second Cease and Desist notice to defendants on 26th June 2009. Moreover on dt. 7th September 2013 filed infringement suit against the defendants. The Plaintiff also filed the notice of motion for interim relief injuncting the defendants from using the impugned trademark in any manner thereof.

Issues Involved:

  1. Whether the defendant’s mark is deceptively similar to the Plaintiff’s mark?

  1. Whether the fact that other marks exists with the word “FER” is determinative, in that the use of this word or abbreviation by the Defendant cannot be said to constitute an infringement of the Plaintiff ’s marks?

  1. Whether it constitutes a valid defense if it be shown that Plaintiff is not the first user of the impugned mark?

  1. Whether Plaintiff’s claim stands defeated if the alleged delay is proved? And if the knowledge of the Plaintiff regarding the Defendant’s use is shown, hasnot the Plaintiff acquiesced in the Defendant’s use of its rival marks? Whether S. 33 is limited to a later registered trade mark?

Issue 1:

The court held that the true test is to juxtapose the two marks and then analyze the likely effect on the mind of a person of average intelligence and imperfect recollection. In the present case the entire mark of the plaintiff is incorporated in the defendant’s mark which makes it deceptively similar to the plaintiff’s mark. Thus there is no difference between the plaintiff’s mark and the defendant’s mark except for the addition of the preceding letter ‘C’.  The court also relied on the case of Boots Company PLC v. Registrar of Trade Marks & Anr. Wherin it was held CROFEN to be deceptively similar to BRUFEN. Thus the court held that the Defendant’s mark is confusingly and deceptively similar to the Plaintiff’s mark.

Issue 2:

The court held that the fact is inconsequential that there exists other mark with the term FER in them. Moreover in view of the fact that the defendant itself has sought for the registration of the mark with the term FER, defendants cannot claim lack of distinctiveness.

Issue 3:

The defendants claim that the markl ‘OROFER’ is already used by one Advent Laboratories Patna who is prior user since 1983 and the mark is registered on 24th September 1985. The plaintiff however denied the contention and claimed that the mark was filed on proposed to be used basis and there is no evidence of its actual use. Moreover Section 28(3) and Section 12 provides for co existence of the marks on the register where both the proprietors do not have exclusive rights over each other, however as against third party each of them has full rights against the third party. The court held that in the present case the defendant is the third party and not the concurrent user.

Issue 4:

The court held that mere delay in filing the suit in no way defeat the rights of the registered proprietor and which is not firmly settled by various case laws. (Relied Medley Pharmaceuticals Ltd. v Twilight Mecantiles Ltd. & Anr) Moreover it is also settled principle that in law question of acquiescence arises where the proprietor being aware of the rights and the infringement of the mark but fail to sue without a positive act of encouragement. And this is not the defence available to the infringer.

The court held in reference to acquiescence that “Acquiescence is a species of estoppel, a rule in equity and a rule of evidence.  Essential  to the acquiescence  doctrine  is  that  it  is  accompanied  by  an encouragement  or an inducement:  he who possesses a legal  right must have encouraged the alleged violator of that right in acting to the latter’s detriment, confident in the knowledge that the former is not asserting his rights against the violator. Acquiescence is not mere negligence or oversight. There must be the abandonment of the right to exclusivity”.

The court on the question of delay, acquiescence and honesty of adoption, relied on Cadila Pharmaceuticals Ltd. v Sami Khatib and Hindustan Pencils and Schering Corporation and held that even if it is assumed that the defendant’s adoption was honest, the defendant had the means to discover the plaintiff’s mark and particularly in view of the fact of plaintiff’ opposition to the defendant’s mark, the continued use of the mark by the defendant was at its peril. Moreover the onus of proving the honest and concurrent user lies with the defendant and the defendant fails to prove the same. However the defendant also fails to produce the sales figure. Hence question of acquiescence did not arise. (Relied on Win Medicare v. Somacare Laboratories Ltd)

The defendant further claimed that the S. 33 also applies to the unregistered mark whereas the court rejected the argument and held that the “S. 33 operates in a well defined and circumscribed set of circumstances. It cannot possible oust every other plea of acquiescence”.

About the Author: Mr. Abhijeet Deshmukh, Trade Mark Attorney, Khurana & Khurana, Advocates and IP Attorneys and can be reached at: Abhijeet@khuranaandkhurana.com