Category Archives: IP Litigation

Teva held responsible for Induced Infringement of Eli Lilly’s Blockbuster drug ALITMA

In Teva Parenteral Medicines, Inc.; APP Pharmaceuticals LLC; Pliva Hrvatska D.O.O.; Teva Pharmaceuticals USA, Inc.; and Barr Laboratories, Inc. (hereinafter referred to be as Defendants/Appellants/Teva) Vs. Eli Lilly & Co. (hereinafter referred to as Plaintiff/Appelle/Eli Lilly) decided by United States Court of Appeals for the Federal Circuit (CAFC) on January 12, 2017, Plaintiff had filed Hatch Waxman suit against defendant to prevent them from launching generic version of the lung cancer drug whose rights are reserved with the plaintiff. The decision from CAFC came after an appeal from the United States District Court for the Southern District of Indiana in No. 1:10-cv-01376-TWPDKL, Judge Tanya Walton Pratt.

Eli Lilly owns a patent US 7772209 (hereinafter referred to as US‘209) issued in 2010, relating to method of treatment administering the chemotherapy drug pemetrexed disodium (hereinafter referred to as “pemetrexed”) (used to treat certain types of lung cancer and mesothelioma) after pretreatment with two common vitamins—folic acid and vitamin B12 (reduce the toxicity of pemetrexed in patients). Eli Lilly markets pemetrexed under the brand name ALIMTA®.

In 2008-2009, Defendants notified Eli Lilly that they had submitted ANDA seeking approval to market generic version of ALIMTA®. After issuance of US’209 patent, Teva sent additional notice that they had filed Para IV certifications, declaring that US’209 patent was invalid, unenforceable, or would not be infringed. Subsequent to which Eli Lilly alleged Teva of induced infringement. Eli Lilly asserted that Teva’s generic drug would be administered with folic acid and vitamin B12 pretreatments and thus will result in infringement of the 209 patent.

Eli Lilly asserted claims 9, 10 (dependent on claim 1), Independent claim 12, and its dependent claims 14, 15, 18, 19, and 21 of the US’209 patent at trial.

Independent claims 1 and 12 have been reproduced below for reference:

Claim 1:

A method of administering pemetrexed disodium to a patient in need thereof comprising administering an effective amount of folic acid and an effective amount of a methylmalonic acid lowering agent followed by administering an effective amount of pemetrexed disodium, wherein the methylmalonic acid lowering agent is selected from the group consisting of vitamin B12, hydroxycobalamin, cyano-10-chlorocobalamin, aquocobalamin perchlorate, aquo-10-cobalamin perchlorate, azidocobalamin, cobalamin, cyanocobalamin, or chlorocobalamin.

Claim 12:

An improved method for administering pemetrexed disodium to a patient in need of chemotherapeutic treatment, wherein the improvement comprises:

  1. a) administration of between about 350 μg and about 1000 μg of folic acid prior to the first administration of pemetrexed disodium;
  2. b) administration of about 500 μg to about 1500 μg of vitamin B12, prior to the first administration of pemetrexed disodium; and
  3. c) administration of pemetrexed disodium.

It is important to note that current case involves issue of induced infringement i.e. a type of indirect infringement that may be committed under section 271 (b) (dealing with infringement of Patents).

In June 2013, Defendants conditionally conceded induced infringement under then-current law set forth in Akamai Technologies, Inc. v. Limelight Networks, Inc. (Akamai II) which at that time was the subject of a petition to the Supreme Court for a writ of certiorari. The parties’ stipulation included a provision reserving Defendants’ right to litigate infringement if the Supreme Court reversed or vacated Akamai II.

District court had rejected contentions of the defendant that Patent was invalid for obviousness or obviousness-type double patenting and also due to indefiniteness of the term vitamin B12.

Defendants filed an appeal on invalidity. While that appeal was pending, the Supreme Court reversed Akamai II, holding that liability for inducement cannot be found without direct infringement, and remanding for CAFC court to possibly reconsider the standards for direct infringement. In view of that development, the parties in this case filed a joint motion to remand the matter to the district court for the limited purpose of litigating infringement. CAFC granted the motion.

The district court held a second bench trial in May 2015 and concluded in a decision issued on August 25, 2015 that Defendants would induce infringement of the US’209 patent. This was after considering the effect of Akamai V decision, which had broadened the circumstances in which others’ acts may be attributed to a single actor to support direct infringement liability in cases of divided infringement.

Defendants appealed.

Below given factors are taken into consideration while deciding cases of induced infringement:

  • Whoever actively induces infringement of a patent shall be liable as an

Infringer;

  • There cannot be indirect infringement without direct infringement;
  • Patentee needs to prove alleged infringer knew or should have known his actions would induce actual infringements; and
  • Standard of proof required by Patentee to claim relief under induced infringement is ‘preponderance of the evidence’.

It was agreed by parties that Defendants’ proposed product labeling would be materially the same as the ALIMTA® product labeling and consists of two documents: the Physician Prescribing Information and the Patient Information. District court found that both the documents included instructions regarding the administration of folic acid—the step that the district court found would be performed by patients but attributable to physicians.

According to Akamai V, where no single actor performs all steps of a method claim, direct infringement only occurs if the acts of one are attributable to the other such that a single entity is responsible for the infringement. The performance of method steps is attributable to a single entity in two types of circumstances:

  • when that entity “directs or controls” others’ performance, or

 

  • when the actors “form a joint enterprise.”

In Akamai V, CAFC had held that directing or controlling others’ performance includes circumstances in which an actor:

(1) “conditions participation in an activity or receipt of a benefit” upon others’ performance of one or more steps of a patented method, and

(2) “establishes the manner or timing of that performance.”

District court found taking folic acid in the manner recited by the asserted claims is a critical and necessary step to reduce potentially life threatening toxicities caused by the Pemetrexed amounts to receive the benefit of the patented method.

Regarding first of the two pronged test, the court found, based on the product labeling, that taking folic acid in the manner specified is a condition of the patient’s participation in the Pemetrexed treatment. Regarding the second prong, the court found that physicians would prescribe an exact dose of folic acid and direct that it be ingested daily. Hence court held all steps of the asserted claims would be attributable to physicians.

Court further observed that the mere existence of direct infringement by physicians, while necessary to find liability for induced infringement, is not sufficient for inducement but there has to be also specific intent and action to induce infringement. Court went on to find intent on the part of physician for the inducement and held that there was no error in district court’s decision. Some important observations of court have been mentioned below.

CAFC made two important observations as below:

  • The intent for inducement must be with respect to the actions of the underlying direct infringer, here physicians.

 

  • Second, it is not required to show evidence regarding the general prevalence of the induced activity. When the alleged inducement relies on a drug label’s instructions, the question is not just whether those instructions describe the infringing mode,..but whether the instructions teach an infringing use such that we are willing to infer from those instructions an affirmative intent to infringe the patent. Court further observed that the label must encourage, recommend, or promote infringement and it is irrelevant that some users may ignore the warnings in the proposed label.

Court went on to observe a label that instructed users to follow the instructions in an infringing manner was sufficient even though some users would not follow the instructions, but vague instructions that require one to look outside the label to understand the alleged implicit encouragement do not, without more, induce infringement.

On the issue of invalidity on the indefiniteness of the term “vitamin B12”, CAFC hold that a person of ordinary skill in the art would understand the scope of the claim term “vitamin B12” with reasonable certainty. Applying Nautilus (outcome of this decision) in this case did not lead CAFC to a different result from the district court’s conclusion on the question of indefiniteness.

Regarding issue of invalidity due to obviousness, CAFC was not convinced that the district court committed clear error in concluding that Defendants failed to carry their burden of proving that it would have been obvious to a person of ordinary skill to use vitamin B12 pretreatment to reduce Pemetrexed toxicities.

Thus CAFC affirmed district court decision.

About the Author :  Ms. Rashmi Goswami, WOS-C at TIFAC, intern at Khurana and Khurana, Advocates and IP Attorneys and can be reached at swapnil@khuranaandkhurana.com

PATENT INFRINGMENT SUIT BY DOLBY AGAINST OPPO AND VIVO

Anjana Mohan, an intern at Khurana & Khurana, Advocates and IP Attorneys deals with the updates in the Patent Litigation between Dolby International and two Smartphone companies Oppo and Vivo over the patented technology by Dolby.

Dolby filed suits vide Suit no CS(COMM) 1425/2016 and CS(COMM) 1426/2016 against various parties including the two major Chinese companies Oppo and Vivo, and their number of affiliated local entity, at the Delhi High Court alleging patent infringement of its technology and for illegally selling phones with Dolby technology  without paying appropriate royalties for use of its patented technologies.

The defendants had filed applications, without prejudice to their rights and contentions, state that to enable them to continue manufacturing and selling goods with the technology in which the plaintiffs claim patent, that they are ready and willing to deposit in this court the royalty as computed and stated in the plaint. The applicants/defendants offer to deposit royalty in this court at the rate of Rs.32/- per unit manufactured /sold/imported. However the counsel for the Plaintiff contended that they have specified the standard royalty charged by them from all licensees and which is graded as per the volume of manufacturing/sales/imports. It was also contended on behalf of Plaintiff that the royalty at the highest rate would work out to about Rs.38/- per unit and that the defendants should be directed to pay royalty at the said rate directly to the plaintiffs in US Dollars, as is being paid under interim orders in a large number of other suits, a compilation whereof is handed over in the court. It was also contended that the defendants should pay also the arrears of the royalty due with effect from the date the defendants started manufacture/sale/import of the goods with the subject technology.

As per the order on the 27th of October 2016, the court ordered that the defendants should furnish the particulars regarding the manufacture, importation and sale of the products on the 5th of the succeeding month. Moreover, the defendants are required to pay on the 8th of the succeeding month the royalty at the rate of Rs.34/- and in return, would allow the continuance of the importation/sale/manufacture of the goods. The directors of the said companies have agreed to be bound by the undertaking of the court.

Further, after much deliberations/arguments/contentions pertaining to the rate of royalty to be paid interim, the Plaintiffs and Defendants has represented to the Hon’ble Court that the parties have worked out an interim arrangement during the pendency of the suit. They have in Court handed over a draft of the interim arrangement which had been perused and found acceptable by the Court. The said terms envisaged the appointment of a Mediator. The counsels state that this Court may appoint any retired Judge of this Court as Mediator and they would pay lump-sum remuneration of Rs.5,00,000/- for mediation, to be shared equally between the plaintiffs and the defendants. Chief Justice A.P. Shah (Retd.) has agreed to mediate as per the recent order dated 14th December 2016.

In the light of the above it would be interesting to note the final verdict in the matter and thus is much awaited.

References:

Interplay of section 51 and 52 of the Copyright Act, 1962: Delhi High Court judgement

This article enunciates the recent, much awaited, and landmark judgment delivered on September 16, 2016 by Hon’ble Delhi High Court throwing light on the important provisions of the Copyright Act, 1962. This case tries to draw the line between the rights of the author, publishers of the work and competing rights of society.

The case was between THE CHANCELLOR, MASTERS & SCHOLARS OF THE UNIVERSITY OF OXFORD & ORS. Vs. RAMESHWARI PHOTOCOPY SERVICES & ANR. In this case, five plaintiffs THE OXFORD UNIVERSITY PRESS, CAMBRIDGE UNIVERSITY PRESS U.K., CAMBRIDGE UNIVERSITY PRESS INDIA PVT LTD., TAYLOR & FRANCIS GROUP U.K., and TAYLOR & FRANCIS BOOKS INDIA PVT. LTD. filed a suit against RAMESHWARI PHOTOCOPY SERVICE and UNIVERSITY OF DELHI for the relief of permanent injunction from infringing the copyright of the plaintiffs in their publications by photocopying, reproduction and distribution of copies of plaintiffs‘ publications on a large scale and circulating the same and by sale of unauthorised compilations of substantial extracts from the plaintiffs‘ publications by compiling them into course packs / anthologies for sale. Amongst other arguments, defendant replied with claiming that their activities fall under section 52 of the Copyright Act, 1962 and hence do not constitute infringement.

The article does not intend to discuss all the arguments on the behalf of the plaintiff, defendant and views of the judges on the same. Instead, this article intends to discuss effect of the judgment on the interplay between section 51 which declares certain acts as infringement of copyright and section 52 of the act which allows certain acts to be done without falling within the purview of infringement. Article also intends to discuss the scope of educational use allowed under copyright act in light of this landmark judgement.

In September, 2012, University of Delhi (DU) was ordered by the court to examine the proposal to obtain a license from Reprographic Rights Organisation such as IRRO for preparing course packs was passed. By the same order, court also ordered defendant No.1 to maintain proper accounts of sales and to file a fortnightly statement before the court. In reply, DU submitted that question of obtaining licenses arises only if their activity causes infringement of the plaintiffs’ right. Court accepted the contention of the DU and decided on whether activities of defendant fall under infringement.

Vide order dated 17th October, 2012, the defendant No.1 was restrained from making, selling course packs / re-producing the plaintiffs‘ publications or substantial portions thereof by compiling the same either in a book form or in a course pack, till the final disposal of the application for interim relief.

Later, in order to decide whether activities of defendant fall under section 51 or not and if so did they fall under section 52 or not, court observed as below:

Did the activities of defendant fall under section 51?

The court concluded that activities of defendant fall under section 51 and observed as below:

The defendant No.2 University thus, though entitled to issue the books, published by the plaintiffs and purchased by it and kept by the defendant No.2 University in its library, to whosoever is entitled to issuance of the said books from the library, per Section 14(a)(i) and Section 51(a)(i) would not be entitled to make photocopies of substantial part of the said book for distribution to the students and if does the same, would be committing infringement of the copyright therein.”.

Did the fall under section 52?

Court had to decide whether reproduction of material fall under section 52 (i) and while doing that court had to decide whether activities allowed so as not to constitute infringement also cover institution and more than one pupil and whether interpretation of term ‘instruction’ should be restricted to lecture or not. Court held that institution providing instructions to more than one pupil fall under activities allowed under section 52. Moreover court also held that instruction cannot be limited to the term lecture in classroom.

Can section 52 be interpreted as independent of the section 51 or it is proviso or exception to section 51?

Once the acts listed in Section 52 are declared as not constituting infringement of copyright and the reproduction of work resulting from such acts as not constituting infringing copy, it follows that the exclusive right to do the acts mentioned in Section 52 has not been included by the legislature in the definition in Section 14; of copyright, once that is so, the doing of such act cannot be infringement under Section 51 and the question of taking the same out by way of proviso or exception does not arise.

Are defendants liable for infringement?

Section 51 prescribes that copyright is infringed inter alia when any person does anything exclusive right to do which has been conferred by the Act on the owner of copyright. It follows, if there is no exclusive right, there is no infringement. Section 52 lists the acts which do not constitute infringement. Thus, even if exclusive right to do something constitutes copyright, if it finds mention in Section 52, doing thereof will still not constitute infringement and the outcome thereof will not be infringing copy within the meaning of Section 2(m).

Ultimately, court held defendants not liable of infringement.

Court observed that if students were not having access to course packs provided by the defendants, it would not have resulted students buying books, rather it would have resulted in students sitting in libraries taking notes by hand. That would have been injustice in the age of modern technologies. Court also held that declaring acts of defendants as infringement would result in such interpretation of law that results in regression of the evolvement of the human being for the better.

However this judgement did not deal with the cover-to-cover copying of the books as that was not a fact in issue. We will have to wait till we get verdict dealing with such issue.

Further, as consequences of this judgement, with free licensing of photocopying the books, publishers are more likely to invest less in Indian markets. However, some IP experts are also of the view that there would not be any such effect. Let time reflect the real effects.           

About the Author: Ms. Divya Choubey and can be reached at: swapnil@khuranaandkhurana.com

Federal Circuit Rules 180-Day Post-Licensure Notice is Mandatory in Biosimilar Litigation

In Amgen v. Apotex (No. 2016-1308), the US Court of Appeals for the Federal Circuit on July 5, 2016 affirmed a district court’s ruling that a biosimilar applicant must provide a reference product sponsor with 180 days’ post-licensure notice before commercial marketing of a biosimilar product begins, regardless of whether the applicant provided the § 262(l)(2)(A) notice of USFDA review.

            In Amgen v. Apotex, the Federal Circuit rejected Apotex’s contention that the 180-day pre-marketing notice requirement does not apply to biosimilar applicants who participated in the “patent dance” procedure of the Biologics Price Competition and Innovation Act (“BPCIA”), expanding on its decision in Amgen v. Sandoz that the 180 days notice provision under § 262(l)(8)(A) is mandatory in all circumstances, whether or not the applicant engages in the patent dance.

Background:

            The biologic product at issue is Amgen’s Neulasta® (pegfilgrastim). Pegfilgrastim is a PEGylated form of the recombinant human granulocyte colony-stimulating factor (GCSF) analog filgrastim. Pegfilgrastim treatment that can help patients make white blood cells after receiving cancer treatment. After Apotex filed a Biologic License Application (BLA) seeking FDA approval to market a biosimilar version of Neulasta® (pegfilgrastim), the parties began the BPCIA’s patent information exchange process, known as the “patent dance”, and as a result, Amgen concluded that two patents U.S. Patent Nos. 8,952,138 and 5,824,784 will be infringed by Apotex’s biosimilar version of Neulasta®. Those infringement claims are being litigated in the U.S. District Court for the Southern District of Florida, although the ‘784 patent has been dropped since it expired.

            Apotex sent Amgen a letter on April 17, 2015, stating that it was “providing notice of future commercial marketing pursuant to § 262(l)(8)(A), though Apotex lacked an FDA license.” Amgen sought a preliminary injunction to “require Apotex to provide … notice if and when it receives a marketing license from FDA and to delay any commercial marketing for 180 days from that notice.” The district court granted that motion, citing the Federal Circuit’s decision in Amgen v. Sandoz that notice cannot be given before the biosimilar product is approved. Apotex appealed.

What is Biosimilar Patent Dance:

            The US Biosimilars Act sets forth several requirements for biosimilar applications, including the so-called “Patent Dance” which describes the process by which the biosimilar applicant and the reference product sponsor (“RPS”) exchange patent-related information for resolving any patent disputes before a biosimilar product can enter the US market.  This procedure has strict timing and sequencing requirements and involves several rounds of information exchanges between the reference product sponsor and the biosimilar applicant. Some of the key steps of this process include:

  • Within 20 days after the FDA has accepted its abbreviated application, the biosimilar applicant must provide the reference product sponsor with confidential access to the biosimilar application and relevant manufacturing information for the proposed biologic.
  • Within 60 days of receiving these materials, the reference product sponsor must provide to the biosimilar applicant: (1) a list of patents it believes are infringed, and (2) identify which, if any, of these patents it would be willing to license to the biosimilar applicant.
  • Within 60 days of receipt of the patent list, the biosimilar applicant must provide the reference product sponsor a statement describing, on a claim-by-claim basis, the factual and legal basis as to why each patent is invalid, unenforceable, and/or not infringed. Within this same 60 day period, the biosimilar applicant may provide to the reference product sponsor a counter list of patents that the biosimilar applicant believes could be subject to a claim of patent infringement.
  • Within 60 days of receiving these materials, the reference product sponsor must provide a reciprocal statement describing, on a claim-by-claim basis, the factual and legal basis that each patent will be infringed, as well as a response to any statement regarding validity and enforceability.
  • The parties then have up to 15 days to negotiate in good faith to arrive at a list of patents, if any, that should be subject to a patent infringement action.

– If the parties reach agreement, then the reference product sponsor must bring an infringement action within 30 days for each patent on the negotiated list.

– If the parties do not reach agreement, the biosimilar applicant must notify the reference product sponsor of the number of patents it will provide in a second list, and the parties then simultaneously exchange within 5 days of this notice a list of patents that each party believes should be the subject of the infringement litigation. Within 30 days after this exchange, the reference product sponsor must bring an infringement action on all the patents on the simultaneously exchanged lists.

The Federal Circuit’s decision in the Amgen v. Apotex case:

            Two provisions of the BPCIA were at play in the Federal Circuit’s decision.  First, under § 262(l)(2)(A), the biosimilar applicant initiates the statutory “patent dance” by providing a copy of its biosimilar application and information about how its product is manufactured.  Second, under § 262(l)(8)(A), the applicant must provide a notice to the innovator 180 days before the first commercial marketing of the biosimilar product.

            In Amgen v. Apotex, Apotex argued that it had followed the patent dance procedure and made its (2)(A) disclosures to Amgen, and that the (8)(A) notice of commercial marketing is only mandatory if the applicant failed to provide the information required by (2)(A).

            The Federal Circuit rejected this argument and upheld the district court’s grant of an injunction to Amgen.  The court held that (8)(A) is mandatory in all circumstances, whether or not the applicant engages in the patent dance.

            The Federal Circuit looked to the text of the law, finding that the “language of (8)(A) is categorical”, and there is “no other statutory language that effectively compels a treatment of (8)(A) as non-mandatory.”  The court further noted that § 262(l)(8)(A) “contains no words that make the applicability of its notice rule turn on whether the applicant took the earlier step of giving the § 262(l)](2)(A) notice that begins the patent dance (i.e. information-exchange) process,” and stood by its holding in Amgen v. Sandoz that the statute is “‘a standalone notice provision’ not dependent on the information-exchange processes that begin with (2)(A).” The court held that “the (8)(A) notice must be a notice given after FDA licensure of the biosimilar product, not before, and that pre-licensure notices are of no legal effect for purposes of (8)(A)”. The court explained that the 180 days period gives the reference product sponsor a period of time to assess and act upon its patent rights.

            In sum, the Federal Circuit concluded that a biosimilar applicant must provide a reference product sponsor with 180 days’ post-licensure notice before commercial marketing begins, regardless of whether the applicant provided the (2)(A) notice of FDA review.

The Federal Circuit’s order can be found at the following link:

http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/16-1308.Opinion.6-30-2016.1.PDF

About the Author: Antony David, Senior Patent Associate at Khurana & Khurana, Advocates and IP Attorneys and can be reached at: antony@khuranaandkhurana.com.

Division Bench of Delhi High Court passed an interim order in Glenmark v. Symed (July 2015)

The High Court of Delhi has passed an interim order wherein the  Justices have made it clear that the appellant (Glenmark) may use any other process which may be a development of Glenmark process / Upjohn process so long as it does not infringe the patented processes of the respondent (Symed).

Background:

Symed Laboratories Ltd. is an Indian bulk drug manufacturer based in Hyderabad. Among other drug products, it manufactures Linezolid, an antibacterial used to treat skin and blood infection including pneumonia. Symed owns two process patents (IN213062 and IN213063) for the manufacture of intermediates for linezolid. The product patent for the drug is owned by Pfizer. Symed has sued a number of Indian manufacturers of Linezolid for patent infringement including Glenmark, Optimus Pharma, Alkem Laboratories Limited (Symed has now entered into a settlement with Alkem), Mankind Pharma Limited and Sharon Bio-Medicine Ltd.

The Delhi High Court had granted an ad interim injunction on 19 January 2015 restraining the Defendants, through their officers, directors, agents and distributors from manufacturing, selling, offering for sale, advertising or directly or indirectly dealing in the production of Linezolid manufactured in a manner so as to result in infringement of the Symed’s registered Patents IN213062 and IN213063 till the disposal of the suit.

The grant of interim injunction had been predicated on four criteria:

  • That there is a prima facie case in favour of the plaintiff;
  • That the plaintiff is likely to suffer an irreparable injury if the defendant is not restrained;
  • That the balance of convenience lies in favour of the plaintiff; and
  • That public interest would not be dis-serviced by the grant of the injunction.

However, the injunction against Glenmark was vacated by the Delhi High Court consisting of Justice Badar Durrez Ahmed and Justice Sanjeev Sachdeva within 2 weeks of the Single Judge’s decision. The other defendants in this case have not been as lucky and continue to suffer the injunction.

While setting aside the January 19 order, the court noted: “It was incumbent upon the single judge to prima facie come to a finding that the active pharmaceutical ingredient (API) of both Glenmark and Symed were identical.”

“This (prima facie finding) does not appear to have been done. In these circumstances, we are vacating the interim order and modifying the same by directing appellant (Glenmark) to maintain accounts and file same in court..,” the Bench said and listed the matter for further hearing on 16 March 2015.

It was also noted by the Court that the single judge did not go into the point regarding applicability of section 104A of the Patents Act 1970 as per which in suits alleging infringement of process patents, the defendant (Glenmark) has to prove that its process is different from that of the plaintiff.

Symed Labs Ltd. vs Glenmark Pharmaceuticals Ltd. on 17 July 2015

In the very recent decision, the Delhi High Court has ordered that Glenmark shall use its process which is virtually identical to the Ujohn process as indicated in the expert report of Prof. Steven W. Baldwin (filed by Glenmark). The Court noted that the expert report indicates that the appellant (Glenmark) process and the Uphohn process are different from the process of preparation of Linezolid, which is employed by the respondent (Symed).

It has been agreed by both the parties that the appellant (Glenmark) shall manufacture Lineolid through its process indicated in the expert report which does not infringe upon the patented process of Symed as indicated in the report. The learned counsel for the respondent (Symed) has accepted the report to the extent that the process shown as the Glenmark process which is virtually identical to the Upjohn process does not infringe the patented process of Symed for production of Linezolid. The learned counsel for the appellant has also stated that they have not and shall not use the patented process of Symed numbered as IN213062 and IN213063.

Paragraph 24 of the report of Prof. Stephen W. Baldwin reads as under:

24. The two claimed intermediate compounds discussed above (PHPFMA and CHFA) do not appear in the Glenmark process for making Linezolid. Moreover, the reaction conditions involved in the various Glenmark process steps would not produce either of these claimed comounds, even as trace inpurities

[CHFA (N-[3-Chloro-2-(R)-hydroxprophy1]-3-fluoro-4-morpholinyl-anlaniline) : PHPFMA (N-3 [Phthalimido-2-(R)-hydroxprophyl]-3-fluoro-4 (morpholinyl) aniline]

While both the parties have accepted the above extracted paragraph No.24 of the report, the Justices have made it clear that the appellant (Glenmark) may use any other process which may be a development of Glenmark process / Upjohn process so long as it does not infringe the said patented processes of the respondent.

Dr. Singhvi, the learned senior Advocate stated on behalf of appellant (Glenmark) that the appellant has already been and will continue to take declarations from sellers of Linezolid to the effect that the seller does not violate anybody’s registered patent and will also in future specify in the declaration b the seller that he does not violate Symed’s aforesaid two patented processed, adding that in the event the respondent initiates legal proceedings against a seller for infringement of the aforesaid two patents, the appellant, on a request being made, would supply the aforementioned declaration.

About the Author: Antony David, Senior Patent Associate at Khurana & Khurana, Advocates and IP Attorneys and can be reached at: antony@khuranaandkhurana.com

Parallel Imports

A company sets different price for its products for different countries as per the requirements. Parallel Imports come about when there is a Currency and Tax Difference between two countries as stated above, encouraging people to import products from one country and sell it off in the other country to earn profit (For example: a person importing iphones from USA at lower price and selling those iphones in India after breaking the codes or selling magazine editions of one country into other at higher price). Now when we deal with Parallel Imports, the concept of ‘Principle of Exhaustion’ comes into consideration. It says that once the protected goods are sold to a consumer or buyer, the IP Rights associated with the same gets exhausted.  It is also known as ‘Exhaustion Doctrine’ or ‘First Sale Doctrine’.

What now needs to be clearly understood is that the Trademarks have a particular Goodwill coupled to it and Parallel Imports may injure them if the products are not of satisfying quality standards in the Imported Country. The main benefit of parallel import is that it encourages competition, and Trademarked or Genuine goods are available to consumers at different prices.

Parallel Imports basically constitute import of Non-Counterfeit or Genuine Goods from one country to another without the permission of the IP owner. The products are indeed legal, but are unauthorised because they are imported without the permission of the Proprietor. The products thus imported are often termed as Grey Products (and not black, owing to the fact that they are Genuine). The Parallel Imports cases are closely related to Trademarks and Copyrights and also equally to the International Trade Market, practically observed when people import goods (for example books or mobile phones) which have Trademarks and Copyrights attached with them.

Parallel Imports Related to Copyright

Earlier the definition of ‘infringing’ copy under Sec 2(m) of Indian Copyright Act was not broad, but since the Amendment, the meaning has been broadened which now clearly states “Provided that a copy of a work published in any country outside India with the permission of the author of the work and imported from that country shall not be deemed to be an infringing copy”[1].

Parallel Import Related to Trademark

Sec 30(4) of the Indian Trademarks Act very evidently states that “Sub-Section (3) shall not apply where there exist legitimate reasons for the proprietor to oppose further dealings in the goods in particular, where the condition of the goods, has been changed or impaired after they have been put on the market.” This section allows the Trademark owner to control the circulation of goods.”[2]

The two major issues that are often discussed regarding the Parallel Imports and Trademarks in India are Whether Parallel Imports make up Infringement under Section 29 of the Trademarks Act and Whether India recognises the principle of ‘International Exhaustion of Rights’ under Section 30 of the Trademarks Act.[3]

Samsung Electronics Company Limited & Anr. .(Plaintiffs) Vs. Kapil Wadhwa & Ors (Defendants).

Plaintiff no. 1 is a company incorporated under the laws of Korea and plaintiff no. 2 is a company under the Indian companies’ act, plaintiffs also informed about their business in India which has been initiated since 1995 when the plaintiff No. 2 was formed. It has a registered trademark “SAMSUNG” under which it carries business worldwide. In March 2011, plaintiffs received information from market sources that defendants were distributing, retailing and selling grey market printers of the plaintiffs in the market and not the ones supplied by the plaintiff No. 2.

Plaintiffs preferred an IA No.7774/2011 under Order XXXIX Rule 1 and 2 CPC which came up for hearing on 11.05.2011 and then on 03.06.2011. The  court ordered “The Defendants, their partners, and all others acting for and on their behalf are restrained from importing, exporting distributing, selling, offering for sale, advertising, directly or indirectly dealing in grey market ink cartridges/toners, or any other products of the plaintiffs under the mark SAMSUNG amounting to infringement of  plaintiffs registered trademarks.”

Defendants filed written statement and an application which is IA No.10124/2011 under Order XXXIX Rule 4 read with Section 151 CPC seeking vacation of interim order passed on June 3, 2011.

Hearing the parties on 8.7.2011, the court was pleased to pass an order partially modifying the order dated 3.6.2011 passed in the local commissioner application and the goods were released to the defendants with few directions. Arguments raised by the defendant was that “It is a settled law that the import, sale or resale of genuine printers by the defendants does not amount to infringement, dilution and passing off. The plaintiffs cannot impose restriction on sale or resale of genuine products originating from the plaintiffs. The present acts of the defendants are permissible under Section 30 of the Act of 1999.”

The defendants went into appeal and appeal was partially allowed. Impugned judgment and order dated February 17, 2012 is set aside insofar the appellants have been restrained from importing printers, ink cartridges/toners bearing the trade mark Samsung/SAMSUNG and selling the same in India. The counsels for Plaintiffs (Respondents) submitted before the Court, that an ordinary customer, who is provided with the warranties and after sales service by the Defendant (Appellant) may form a bad impression of product of Plaintiffs (Respondents), which can lead to damage of reputation of Plaintiffs (Respondents). The Division Bench while setting aside the order of the Learned Single Judge directed the Appellants/Defendants to prominently display in their showrooms that the products sold by them have been imported from abroad and that the Respondents (Plaintiffs) do not give any warranty qua the goods nor provide any after service and that the warranty and after sales service is provided by the appellants personally. 

Hindustan Lever Ltd. vs. Briju Chhabra

In the above mentioned case, the Plaintiff (Hindustan Lever Ltd) is the Registered Proprietor of the Trademark ‘LUX’. The Defendant used to import LUX soaps manufactured in Indonesia into India without the permission of Hindustan Lever Ltd when the imported LUX soap was for sale only in Indonesia (as indicated on the soap). It was argued by Hindustan Lever Ltd that such import of soap into India amounts to Infringement of its rights and that there shall be no guarantee that the product will be genuine. The High Court of Delhi agreed with the submissions of the plaintiff and ruled in their favor, since it was of the view that if the Imports had not stopped, then the plaintiff could suffer a huge loss due to defendant’s act of misrepresentation.

International Laws on Parallel Imports

Since the ‘Paris Convention’ and the ‘Berne Convention’ are silent on the issue and are not explicitly prohibiting the same, every country has resorted to having their own method of managing Parallel Imports. According to the TRIPS Agreement (Article 6), “for the purposes of dispute settlement under this Agreement, subject to the provisions of Articles 3 and 4, nothing in this Agreement shall be used to address the issue of the exhaustion of intellectual property rights.”[4]

Countries on parallel imports

Australia: it permits the parallel import of certain products except books, cars, however software CD’s and music CD’s can be imported.

USA: Parallel import is legal in USA. It was made legal by establishing a legal precedent. “In the case of Kirtsaeng v. John Wiley & Sons, Inc., the US Supreme Court held that the first-sale doctrine applies to copies of a copyrighted work lawfully made abroad, thus permitting importation and resale of many product categories.”[5]

Hong Kong: Parallel importation is legal or permitted in Hong Kong under the trademark and copyright before the amendment came in July 6 of 2007.

Japan: “Japan‘s intellectual property rights law prohibits audiovisual articles marketed for export from being sold domestically, and such sale of “re-imported” CDs are illegal.”[6] 

Conclusion

From what can be understood, the main detriment of Parallel Import is that it promotes Free Trade and encourages competition, other than facilitating Trademarked or Genuine goods to be available at different prices, allowing the consumers to have an option to buy genuine goods at a cheaper price. What can also be understood is that if Parallel Imports are done away with, the manufacturers will have their own business monopolies, leading to goods being available at higher prices. Also consumers must note that Parallel Imports may assure lower priced products but they may not get the quality, service or satisfaction which they had in mind while buying the particular product, also another known fact being that Parallel Imports leads to a huge loss of revenue to the Trademark Holder due to the import of ‘grey goods’.

The Government definitely here must intervene in this matter so as to maintain a balance between the interests of the Consumers and Trademark Holders, so that no one is at a higher risk. Whereas obtaining an Interim Injunction with an Anton Piller order is still the most effective option when it comes to ways of tackling Parallel Imports.

Ultimately the bottom line is that the decision on whether to allow Parallel Imports is a choice between quality control and price control; between the economic rights of trademark owners and consumer access; between trade monopolies and free trade.[7]

References

  1. Jain Sneha, “Parallel Imports and Trademark Law”, JIPR, Vol. 14, Jan 2009.
  2. http://cis-india.org/a2k/blogs/parallel-importation-of-books
  3. http://www.mondaq.com/india/x/208942/Trademark/Customs+Circular+Parallel+Imports+Are+Legitimate
  4. http://www.worldtrademarkreview.com/Intelligence/IP-Lifecycle-India/2015/Articles/Parallel-import-issues-under-Indian-trademark-law
  5. http://copyright.lawmatters.in/2011/02/what-is-international-exhaustion.html
  6. http://www.trademarksandbrandsonline.com/article/the-legality-of-parallel-imports
  7. https://indiancaselaws.wordpress.com/2013/08/21/kapil-wadhwa-v-samsung-electronics/

http://www.indiankanoon.com

[1] Section 2(m) of Indian Copyright Act (amended Section)

[2] Section 30(4) of the Indian Trademarks Act, 1999.

[3] Article on Parallel import issues under Indian trademark law by; Ashutosh Kane & Sakshi Pande

[4] Article 6 of TRIPS Agreements

[5] http://www.wikipedia.com

[6] Ibid

[7] http://www.lexology.com/library/detail.aspx?g=50598d06-63bb-455a-baea-aea8cb1d8920

About the Author: Mr. Kapil Prajapati, interns at Khurana and Khurana, Advocates and IP Attorneys.

Recent Patent Litigation Cases (2014-15): India

Patent Litigation in India has steadily increased over last 2-3 years. Dramatic swift has been observed in the innovator’s perspective from the mere aspect of invention to gaining patent protection for their respective invention. Patent owners have adopted aggressive approach towards their patent protection and enforcing their proprietary rights as businesses, are now well-positioned in the realm of patent litigation.  The patent owners are not at all hesitant to challenge the validity of patent rights of their rivals. There has also been gradual increase in the understanding of the complex patent infringement and validity issues.

We will now deal with some of the recent and important patent litigation cases in India.

Merck vs. Glenmark over “Sitagliptin”

In an interesting note, Hon’ble Supreme Court of India on Special Leave Petition filed by Glenmark stayed the Delhi High Court order which passed injunction against Glenmark for the generic drug Sitagliptin till 28th April 2015. Merck Sharp & Dohme filed an application for an ad interim injunction restraining the respondent/defendant Glenmark Pharmaceuticals from using its patented product Sitagliptin (Indian Patent No. 209816) at the Supreme Court. The Delhi high court conclusively held that all the three ingredients (Prima facie, Irreparable injury and balance of convenience) for passing the order of injunction were established by MSD and hence injuncted Glenmark from manufacturing and selling of Zita and Zitamet.

Ericsson vs. Xiaomi

In December 2014, Ericsson had filed a suit against Xiaomi in India for the alleged infringement of the 8 standard-essential patents. The Delhi High Court granted an ex-parte injunction on the sale, manufacture, advertisement, and import of Xiaomi’s devices.

Xiaomi claimed that its latest devices in the Indian market (as of December 2014), the Mi3, Redmi1S and Redmi Note 4G, contained Qualcomm chipsets, which implemented technologies licensed by Ericsson. Xiaomi subsequently challenged the injunction before a Division Bench of the Delhi High Court, which issued temporary orders to allow Xiaomi to resume the sale, import, manufacture, and advertisement of its mobile devices subject to the following conditions:

  • Xiaomi would only sell devices having Qualcomm chips.
  • Xiaomi would deposit Rs. 100 towards royalty for every device it imported to India from the date of the launch of the device in India toJanuary 5, 2015. This amount was to be kept in a fixed deposit for three months during the proceeding of the case.

Novartis vs. Cipla

In another patent litigation case, Delhi High court barred Indian generic drugmaker Cipla from making or selling generic copy of Novartis’s “Onbrez” by giving temporary injunction to Novartis. Citing famous Roche vs Cipla case, the court observed that Novartis has a strong prima facia case and as the validity of the patent is not seriously questioned, there is a clear way out to grant injunction. Further, the court observed that Cipla did not provide any figures about the “inadequacy or shortfall in the supply of the drug.” Earlier Cipla lunched its generic version of Indacarterol in October claiming “urgent unmet need” for the drug in india.

Without going conventional way, Cipla, also approached the Department of Industrial Policy and Promotion (DIPP) to exercise its statutory powers under Section 66 and Section 92 (3) to revoke Indian Patents IN222346, IN230049, IN210047, IN230312 and IN214320 granted to Novartis AG for the drug Indacaterol. Cipla argued on the basis of 3 main points i.e. “epidemic” or a “public health crisis” of COPD, unable to manufacture the same in India by Patentee and high cost of patented drug.

Vringo Vs. ZTE

In January 2014, Vringo and Vringo Infrastructure filed a patent infringement suit in the Delhi High Court against ZTE, over the alleged infringement of its patent IN200572.

In February 2014, the Delhi High court granted an ad-interim ex-parte injunction restraining ZTE from importing, selling, advertising, installing or operating devices that comprise the infringing components. The High court also appointed local commissioners to inspect ZTE’s premises and instructed customs authorities to detain ZTE’s shipments that may contain such devices and to notify Vringo. In March 2014, ZTE appealed against the injunction, which was vacated on August 5 the same year with ZTE being ordered to deposit Rs. 17.85 crore to the court.

The suit is sub judice now. As of August 2014, ZTE had filed for the revocation of IN200572 on grounds of it not being innovative as well as for violating some statutory provisions under Section 64 of the Indian Patents Act.

Reference: http://inpublic.globenewswire.com/2014/09/02/VRINGO+PROVIDES+UPDATE+TO+SHAREHOLDERS+HUG1853040.html

Vringo vs. Asus

In April 2014, Vringo filed a patent infringement suit against AsusTek Computer Inc. in Delhi High Court. As per public updates issued by Vringo to its shareholders, Vringo has alleged the infringement of patent IN223183 entitled “Method and system for providing wireless communication using a context for message compression” by Asus in India.

Asus had claimed that in the context of IN 223183 it was using technology licensed to it by Google. In August 2014, Google filed a request to become a party to the proceedings.

Vringo had requested for an injunction on Asus’ use of the technology in India. The injunction has not been granted yet. No further information about the lawsuit is publicly available.

Reference: http://inpublic.globenewswire.com/2014/09/02/VRINGO+PROVIDES+UPDATE+TO+SHAREHOLDERS+HUG1853040.html

SYMED Labs vs. Glenmark Pharmaceuticals

In another case of SYMED Labs vs. Glenmark Pharmaceuticals, Symed Labs Ltd. had sued Glenmark Pharmaceuticals Laboratories before the Delhi High Court for allegedly infringing two of its patents: IN213062 & 213063. First patent was granted for “Novel intermediates for Linezolid and related compounds” while the ‘063 patent was granted for “A novel process for the preparation of linezolid and related compounds. While declaring the judgment on 9th Jan 2015, the judge convinced that the Plaintiff has got good prima facie case in favour of SYMED. Further the judge decided that protection to the patent processes ought to be granted to the Plaintiff as damages will not be an efficacious remedy. Thus, there will be irreparable loss and injury because of the long uninterrupted use of patents, the balance of convenience also lies in favour of the Plaintiff. Thus the judge granted an ad interim injunction restraining Glenmark from manufacturing, selling, offering for sale, advertising or directly or indirectly dealing in the production of Linezolid manufactured in a manner so as to result in infringement of the Plaintiff’s registered Patents.

Maj. (Retd.) Sukesh Behl & Anr. vs Koninklijke Phillips

In this litigation case, Sukesh Behl made a counter claim for revocation of the suit Patent No. 218255 under Section 64(1)(m) of the Patents Act, 1970 (for short “the Patents Act”) for non-compliance of the provisions of Section 8. Earlier in another suit Koninklijke Phillips sought for permanent injunction restraining Sukesh Behl from infringing its patent and for other incidental reliefs. While delivering the judgement, the judge answered the question of whether the failure to comply with the requirement of Section 8 of the Patents Act would invariably lead to the revocation of the suit patent under Section 64(1)(m) of the Patents Act, the word “may” employed in Section 64(1) indicates that the provision is directory and raises a presumption that the power of revocation of patents conferred under Section 64(1) is discretionary. Citing Chemtura case, the judge hold that the power to revoke a patent under Section 64(1) is discretionary and consequently it is necessary for the Court to consider the question as to whether the omission on the part of the plaintiff was intentional or whether it was a mere clerical and bonafide error. Finally, the judge dismiss the plea of Sukesh Behl for revocation of said patent under section 64 (1)(m).

Enercon vs. Dr. Aloys Wobben

In this land mark decision, Hon’ble Supreme Court of India addressed the multiplicity of patent proceeding cases with respect to Invalidation, opposition and revocation. Dr.Aloys Wobben has filed around 19 infringement suits before the High Court and Enercon India Limited have filed around 23 “revocation petitions” before the Appellate Board, praying for the revocation of the patents held in the name of the Dr. Wobben. The respondents had also filed “counter claims” to the “patent infringement suits” filed by the appellant.  Even though some revocation petitions have been settled by the IPAB, the same issues were being re-agitated by Enercon before the High Court. The Supreme Court of India following rules – firstly, if “any person interested” has filed proceedings under Section 25(2) of the Patents Act, the same would eclipse all similar rights available to the very same person under Section 64(1) of the Patents Act. This would include the right to file a “revocation petition” in the capacity of “any person interested” (under Section 64(1) of the Patents Act), as also, the right to seek the revocation of a patent in the capacity of a defendant through a “counter-claim” (also under Section 64(1) of the Patents Act). Secondly, if a “revocation petition” is filed by “any person interested” in exercise of the liberty vested in him under Section 64(1) of the Patents Act, prior to the institution of an “infringement suit” against him, he would be disentitled in law from seeking the revocation of the patent (on the basis whereof an “infringement suit” has been filed against him) through a “counter-claim”.  Clearly, this judgement laid a smooth road for complex patent litigation practices in India.

It would be interesting to note the developments that would take place in the Patent protection scenario in India and the gradual increase in the patent litigation cases in India.

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

Supreme Court stayed the Delhi High Court order of injunction against Glenmark over the Generic drug “Sitagliptin”

Reportedly, Hon’ble Supreme Court of India on Special Leave Petition filed by Glenmark stayed the Delhi High Court order which passed injunction against Glenmark for the generic drug Sitagliptin till 28th April 2015. The Delhi high court on dated 20th March 2015 set aside an order of single judge bench of Delhi High Court which rejected the injunction application by MSD against Glenmark. This article aims to analyze the Delhi High Court judgment by the Division bench in detail. The detailed judgment can be found here.

Facts of the case:

Merck Sharp & Dohme (hereafter “MSD”) aggrieved by the dismissal of its application for an ad interim injunction restraining the respondent/defendant Glenmark Pharmaceuticals (hereafter “Glenmark”) from using its patented product Sitagliptin (Indian Patent No. 209816) filed an appeal. MSD filed an application before single bench Delhi High Court for permanent injunction, restraining infringement of the patent, damages, rendition of accounts and delivery up. The suit patent relates to a drug which lowers blood sugar levels in Type 2 Diabetes Mellitus (“T2DM”) patients. Glenmark opposed the application for ad interim injunction and relied on documents produced during the hearing. The learned Single Judge rejected the injunction application. Aggrieved by the dismissal of interim injunction Merck sought to obtain an interim injunction against Glenmark seeking to restrain Glenmark from selling its Generic products Zita (generic version of Januvia) and Zitamet (generic version of Janumet, combination of sitagliptin+metmorphin).

Argument advanced by the Appellant (MSD): 

The learned Senior Counsel, Mr. T.R. Andhyarujina for MSD argues, that its drug Sitagliptin is the first in its class of compounds that inhibits the enzyme Di Peptidyl Peptidase-IV (“DPP-IV”). The learned counsel argued that the suit patent is infringed because Sitagliptin and any of its acceptable salts are covered by its claims, thus resulting in the making, using or offering for sale, importing into India etc. of Sitagliptin or any of its salts or any form amounting to infringement of the suit patent. It was further argued that Glenmark, by manufacturing, selling, offering for sale and advertising the pharmaceutical combinations Sitagliptin Phosphate Monohydrate under the brand Zita and Sitagliptin Phosphate Monohydrate and Metformin Hydrochloride under the brand name Zitamet infringes the suit patent and all its claims. It was underlined that Sitagliptin Phosphate Monohydrate cannot be prepared without manufacturing the active ingredient Sitagliptin molecule. Therefore, the use of Sitagliptin claimed by IN 209816 to prepare Sitagliptin Phosphate Monohydrate by Glenmark infringes the suit patent. MSD argued that its non-disclosure of applications (which were not pursued by it) was an inessential detail which should not have clouded the debate on whether Glenmark infringed its suit patent. It was submitted that the subject of the European Patent, and the application No. 5948/DELNP/2005 (filed on 18.06.2004 – in respect of the Phosphoric Acid Salt of a DPP-IV inhibitor that claimed Dihydrogenphosphate salt of Sitagliptin and was abandoned under Section 21(1) on 23.08.2010) could not have been the basis for refusing ad interim injunction. In India, on account of Section 3(d) and the interpretation of the expression “efficacy” by courts, MSD abandoned the phosphate salt application.

The learned counsel for MSD argued that Glenmark’s US Process Patent No. US8334385 is for “Process for the preparation of R. Sitagliptin and its pharmaceutical salts”. It was further contended that this patent clearly admits that Sitagliptin is developed for the treatment of T2DM and is the active free base. It also gives the full description of the process for preparing Sitagliptin freebase in the patent specification which is Scheme 6 in Merck’s patent. The claim of Glenmark’s patent is for a crystalline salt of Sitagliptin. The learned counsel relied upon the disclosures made to the suit patent IN 209816 to state that the basic invention for which patent protection was sought was Sitagliptin “with pharmaceutically acceptable salts thereof”. It is submitted that this is clearly stated in claims 1, 15, 17 and 19. Thus learned counsel stressed that Glenmark”s ZITA (Sitagliptin Phosphate Monohydrate) and ZITA-MET (Sitagliptin Phosphate Monohydrate and Metformin) infringe the suit patent because Sitagliptin is made and used by Glenmark in ZITA and ZITA-MET when it makes salt Sitagliptin Phosphate Monohydrate. It was underlined that the phosphoric acid salt of Sitagliptin was disclosed in the suit patent itself as one of the pharmaceutically acceptable salts.

Arguments advanced by the Respondent:

 The counsel for the respondent argued that the suit patent is obvious and does not involve an inventive step over and above previous disclosures in the prior art. It was further argued that the suit patent is anticipated by prior arts European Patent 1406622 and WO/01/34594.

Further it was argued by the Counsel for the respondent that the suit patent drug Sitagliptin as well as Sitagliptin Hydrochloride are unstable compounds possessing incapability of commercial production and industrial use.

The respondent argued that the claim goes much beyond the limited disclosures in the specification, and thus the claim is overbroad or an impermissible Markush claim that creates a false monopoly. It was also contended that the patent monopoly is too broad to be workable as it includes possibly 4.9 billion compounds and such elastic claims cannot be sustained.

It was argued that the complete specification of the suit patent does not sufficiently and fairly describe the invention and the method by which it is to be performed, since the patent does not describe the preparation of the Sitagliptin free base or Sitagliptin phosphate monohydrate, but only its hydrochloride salt.

Further it was argued that MSD did not comply with its obligation under Section 8 of the Act to disclose patent applications made for the “same or substantially the same invention” – it did not disclose 5948/DELNP/2005 (for Sitagliptin Phosphate Monohydrate), 1130/DELNP/2006 (Sitagliptin Phosphate Anhydrate), 2710/DELNP/2008 (Sitagliptin plus Metformin) or subsequent international applications for these compounds either. It was also argued that such suppression and concealment – contrary to statutory obligations – results in the invalidity of the patent, and at any rate, militates against the grant of an interim injunction that is premised on good faith and complete disclosure.

It was argued by the respondent that the suit patent by the plaintiff’s own admission is different from its product. The only exemplified salt being Sitagliptin Hydrochloride, no other salt can be claimed or covered in the impugned salt patent and the plaintiff, by its own admission equivocally, through several documents admitted that the suit patent is distinct and different from the Sitagliptin Phosphate Monohydrate (SPM) as well as its combinations with Metformin Hydrochloride. Urging that the latter two products are the subjects of separate patents, Glenmark highlighted that this is clear admission that they are not covered by the suit patent. In this respect, the details of the plaintiff’s application, i.e. 5148/DELNP/2005, especially, Claim no.1 and International Patent US 2004027983, again claim no.1 are relied upon. The said salt, i.e. SPM was also claimed to possess tremendous advantages over free base and previously disclosed hydrochloride salt. MSD‟s said patent application no. 5948/DELNP/2005 for SPM was specifically abandoned.

Conclusion:

Considering the arguments advanced by both the parties, the court evaluated the three grounds Prima facie case, irreparable injury and balance of convenience for passing interim injunction as below:

1) The court on the first ingredient held that prima facie case had been established by MSD for the fact that Glenmark uses Sitagliptin free base as the active component in its chemical formulation.

2) The court on the issue of whether the claimant would suffer irreparable injury in the absence of interim injunction or not, held in affirmative. The court rejected the argument of Glenmark that injunction should not be granted as the monetary compensation may be granted. On the contrary court opined that prices may not recover after the patentee ultimately prevails, even if it is able to survive the financial setback (or “hit”) during the interim, which may take some time.

3) On the issue of balance of convenience the court held in favor of MSD. On the issue of price difference between the commercial products by MSD and Glenmark is not so startling as to compel the court to infer that allowing Glenmark to sell the drug, at lower prices would result in increased access. However, the court observed that Permitting Glenmark to operate would not necessarily result in lowering of market prices. Hence according to court the balance of convenience lies in favor of MSD.

The court conclusively held that all the three ingredients for passing the order of injunction were established by MSD and hence injuncted Glenmark from manufacturing and selling of Zita and Zitamet.

About the Author: Meenakshi Khurana, Partner at Khurana & Khurana, Advocates and IP Attorneys and can be reached at: meenakshi@khuranaandkhurana.com

‘Pro Tem’ Relief to Xiaomi for importing and selling of Qualcomm based Handsets in India

Reportedly, a bench of Delhi High Court temporarily allowed Xiaomi to sell few of its devices in India about a week after the suspension of its sales in the third largest smart phone market of the world.

Xiaomi as well as online seller Flipkarthave been injuncted by Delhi High Court in its order dated 8th December 2014 from selling its line of smart phones for it has been prima-facie found to be infringing patents of Swedish technology company Telefonaktiebolaget LM Ericsson. We have reported on Xiomi injunction which can be found here.

Being aggrieved by the order passed by Single judge of Delhi High Court dated 8th December 2014, Xiaomi filed appeal challenging the order. Xiaomi had contended that Ericsson suppressed the fact that the Chinese mobile maker has also used chipsets of Qualcomm which has a license to use patents of the Swedish company. The bench was also told by Senior Advocate KapilSibal and Advocate AjitWarrier, appearing for Xiaomi, that on each Tuesday around one lakh units are expected to be sold on the site. Xiaomi has contended that it did not infringe Ericsson’s patents as Qualcomm has obtained a license from the Swedish company for its patented technology.

Therefore, reportedly on Tuesday 16th December 2014, the Hon’ble High Court granted permission to Xiaomi to continue importing smart phones which comprises of Qualcomm chipsets in them until the next scheduled date for the matter on 8th January 2015 subject to the condition that Xiaomi shall deposit 100 Indian Rupees for each device sold by them towards royalty in favor of the Registrar General of the Delhi High Court and the amount so deposited be kept in a fixed deposit.

Further, the court has also directed Xiaomi to furnish an affidavit, prior to the next date of hearing before the single judge, which shall disclose the number of devices sold by it till then along with the particulars of the invoices of the Qualcomm chipsets purchased by it.

As reported, an Ericsson spokesman said in an email to Reuters that “Xiaomi needs a license from Ericsson for all their phones imported to India, which will be clarified in the upcoming hearing” whereas Xiaomi said company would not comment on the developments.

As per the company’s website, Xiaomi Mi3 and Redmi 1S use Qualcomm chips while Redmi Note device uses a processor from MediaTek Inc.

Sources: Reuters and NDTV

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

Revocation Application/ Proceeding Summary: Improved Diffuser for an Air Conditioning System

Applicant in this case is M/s Air Master Equipments India (P) Ltd and Respondents are:

  1. Mr. Ramesh Nana Mhatre, who is the inventor and Applicant of the granted patent application being discussed, and
  2. Controller of Patents who granted the patent post examination and prosecution. Title of the application is ‘An improved Centre Core, Intermediate Core and an outer frame for a diffuser for use in central air conditioning system and an improved diffuser incorporating them and the method of manufacturing the same’ and case number is TRA/1/2008/PT/CH. The order number of case being discussed is NO 75/2011

 To brief a bit on the understanding the subject matter, in a central air conditioning system, air that is conditioned to a desired temperature at one source is distributed to various places through a network of ducts, and a diffuser is required at every outlet of the duct. Generally, these ducts are of square or rectangular cross section, most probably due to their easy self-resting and properly adjusting nature in corners of the ceiling in the buildings and vehicles, and therefore the diffuser used at the outlet of an air distribution duct is also of square or rectangular shape. The diffuser fitted at the end of the air distribution duct projects/exposes out from the ceiling of a room or any other space required to be air conditioned, and therefore plays a part in interior decoration or overall look of the room/space. Respondent, through his invention, therefore wishes to solve following drawbacks in existing diffusers:

  1. Sometimes, the side sections of each core and outer frame are welded together at corners to avoid gaps, or corner sections, after fixing into the grooved channel sections on the back of two adjacent side sections, are crimped for assembly. The cores are inter-connected through connecting strips that are welded to the collars of each core. The welding and crimping operations require extra equipment as well as these operations are very time consuming thereby increasing the cost of production.
  2. Due to the grooved channel sections at the back side of each side section and corner sections used for the assembly or cores, the weight of the diffuser is increased which also increases the cost of production.
  3. To avoid gaps at the corners of the core(s), the side sections of the cores are produced with high precision, which increases the cost.
  4. On assembly some times there remains a gap between two side sections, at the corners of the core(s), due to which diffusers are rejected, resulting into a big loss of production i.e. material and labour and which further increases the cost of production.
  5. When a diffuser is attached to a duct and conditioned air is blown through the duct, it is noticed that the air is not diffused equally to all sides at the corner sections as the grooved channel sections or ridges at the back surfaces of the cores come in the path of air and disturb the equal and proper diffusion of air in all directions. The enclosed collars of the centre core and intermediate core(s) rebounds the air, thereby reducing the flow or air through corners of the diffuser.
  6. As the diffuser is manufactured in several pieces, which are assembled, manufacturing process is cumbersome, time consuming and labour oriented and increases the cost of production.
  7. Due to the grooved channel sections and corner sections or ridges and welding spots on the back surface of the core(s), dust is accumulated therein, which is difficult to clean.
  8. Dust is also accumulated in gaps at corners on the front surfaces of the cores, which gives a dirty look to the diffuser and tarnish interior decoration look of the room/space.

 A main object of this invention is therefore to obviate the above mentioned drawbacks of the existing diffusers and to provide an improved diffuser for central air conditioning system, wherein each of the central core and/or the intermediate core(s) and/or the outer frame are manufactured in a single piece and both the outer as well as inner surfaces of the cores and/or the outer frame are smooth without any extra section, projection or groove which dispenses with the requirement of extra material, and the time taken for assembly is also very much reduced and at the same time there is no obstacle in the flow path of air, which is diffused equally in all the directions. As the cores are manufactured in a single piece, there is no question of any gap at the corners thus no chance of rejection of the product and no need of any welding and crimping operations and hence the cost of production of the diffuser will obviously be very less.

 Respondent No. 2 (Controller of Patents) was satisfied that the invention was patentable and accordingly the patent was granted vide No. 181821 on 18th Jan, 1995. On 25th August 2006 the Respondent No. 1 sent a legal notice to the Applicant, wherein according to this notice, the Applicant was inter alia informed of the patent in favour of the Respondent and that the Applicant was not entitled to manufacture or sell air diffusers identical to the patented product or substantially similar to it. The Applicant sent a lawyer’s reply dated 13-9-2006 alleging that  the patented product was known in the market, it was neither new nor novel, and that there is concealment of material facts and that the patent was obtained by fraud. It was also alleged that the Respondent was nothing but a job-worker.

 After this exchange of correspondence, the Applicant filed O.P. 704 of 2006 before the Hon’ble Madras High Court for revocation of the patent. This was transferred to IPAB. Counter statement was filed and both sides also filed the evidence to support their case.  Applicant submitted that there was no novelty in the invention and it was obvious and also submitted that the main feature of the invention even according to the Respondent was that it was a single piece centre core to facilitate clean flow of air. He submitted that diffusers have been known for long and there was evidence to show that there was prior art where the single piece units were known. He referred to Series 5700 louvre face ceiling diffusers. From the paper book, he pointed out that there is specific reference to one piece stamped steel construction and that this prior art was also meant to provide an economic solution to air distribution problems requiring equal throw in all directions. According to him, this anticipated the patented product. Further, he submitted that if the only difference is the manner in which the inner assembly can be removed, that hardly qualifies for the grant of a patent.  He then referred to another prior art.  Series 5800 and 5800A louver face Directional Diffusers. He submitted that this too indicated provision of equal throw, quick release of inner assembly for immediate access and ease of installation. According to him, the fact that the prior art was used for ceiling air–conditioners while the patent product was for central air-conditioner will not make it non-obvious.  He also referred to Titus and Trox catalogues, without bearing any dates. On being asked to provide the dates of these documents, he was unable to give any acceptable evidence. Therefore, only two prior arts were provided by the applicant.

 Respondent (Patentee) on the other hand submitted that till 1995 there was no prior art that anticipated the claimed subject matter. All the single piece units were extruded aluminium, which meant that metal sheets were cut and joined. The patented product was, on the other hand, made as a single unit from a special die in a metal press.

 Respondent also produced, before the IPAB board, samples of the prior art and the patented product and submitted that it was wrong to call the Respondent a job worker and that he had won many awards and recognition of his expertise. He submitted that the patented product was supplied by the Respondent to persons in the same business not only in India but abroad too. He submitted that while the prior art shows joints, corners and gaps, the patented product is one smooth surface with no gaps or joints. Also, in the prior art, the assembly is detached by turning clockwise, whereas in the patent product, it is held by spring and is removed by applying pressure. He also submitted that in the prior art, there is a buttoned hole in the centre cone, while the patented product has an outwardly and downwardly directed slanting surface with neither a button nor hole. He submitted that the prior art has uneven surface and crimping and that the air is distributed by rebound, whereas in the patented product, there are no hindrances to the flow of air. The patented product has clear slots while the prior art does not. He further submitted that the prior art is limited to 2 or 3 cone inner assembly, whereas the patented product can have multiple cores depending on the requirement. The Respondent further pointed out to the tabular column in the Respondent’s counter statement where each and every distinguishing feature of the patented product is explained and submitted that the prior art does not teach the invention and that the patented produce is new and non-obvious.  He also submitted that, in addition to the counter statement, the Respondent has marked in evidence the affidavit of one Mr. Pankaj Dharker of impeccable credentials who has affirmed that the product is an invention. He submitted that there is no proof of wrongful use or suppression of information and therefore the Applicant can not raise these grounds without proof. As regards prior publication, the Respondent submitted that there should be material to show that it was published. Respondent further submitted that as regards the ETL report, no reliance can be placed on it without an affidavit to file it as evidence, and in any event, it only refers to diffusers constructed of extruded aluminium, which can not be prior art as far as this product is concerned.

 Submissions were heard and the matter was examined by Hon’ble Justice Prabha Sridevan, wherein it was concluded that the Respondent was most certainly not a job worker and that the evidence filed by the Respondent shows the number of awards and recognition of his merit that he has received from various people including the Government. It was further held that the Applicant also did not seriously urge that stand and that the applicant had not filed any evidence apart from the two prior arts to support its case. It was further stated that the Respondent, on the other hand, had filed a very important piece of evidence that was the affidavit of the expert in the field and spoke of the disadvantages that existed in the diffusers prior to 1995. Evidence of Pankaj Dharker showed that in the existing art, because of the corner sections and the grooved channels, flow of the air was obstructed and that there was a reduction of airflow because in the prior art air rebounded. It was also appreciated that the assembly of various parts was a costly process and that the prior art required joining of the various parts and if this was not done with a high degree of accuracy, there was likely to be higher rate of rejection. Furthermore, it was noted that the prior art designs were aesthetically inferior and that the accumulation of dust was high. His affidavit showed the prior art and the patented product in comparison, both with photographs and with explanatory notes. From the affidavit of the respondent and the supporting evidence, it was concluded that the prior art series 5700 and 5800 did not teach the patented product, and that the claimed subject matter was a new invention that served the object of the invention and also avoided the existing drawbacks of the prior art. 5700 and 5800 are the same except for the fact that 5700 has a 2 cone assembly, while 5800 has a 3 cone assembly. The TROX and the Titus catalogues were not considered since there was no date and It was not know if they are prior to the patented product, but the expert dealt with even those products and has given the opinion that they do not teach this invention. A test for obviousness was applied and it was concluded that the invention was non-obvious. In view of the reasons stated above, it was confirmed that the invention was novel and non-obvious and the revocation application was dismissed.

About the Author: Mr Ankur Sehgal, Patent Associate at Khurana and Khurana, Advocates and IP Attorneys and can be reached at: ankur@khuranaandkhurana.com