The IPO achieved another milestone – issued patent number IN300000

The Indian Patent Office achieved another milestone and has issued its patent number IN300000 in August 2018. The patent has been issued to BASF Corporation for carbon monoxide conversion catalyst.

There has been a  more than 170% increase in the number of applications examined in between 2016-2017. This sharp rise can be  attributed to an increasing number of Examiners and Controllers and in the reduction in time for putting the application in order for grant from 12 months to 6 months. The Patent Office has been taking various steps to not only reduce the backlog but also expedite disposal of the pending applications.

There is also about 50% increase in the number of applications granted in the year 2017 vis-à-vis those granted in the year 2016. Overall, the percentage of applications examined and disposed in the year 2017 was much higher than the year 2016.

With the efforts that the Indian Patent Office has been making towards clearing its backlog, more patents per year are expected to be issued by the IPO in the coming years than in previous years.

 

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Pre-grant Opposition against Novo Nordisk’s Patent application dismissed

A pre-grant opposition filed by Intepat IP services in respect of Novo Nordisk’s Patent Application number 2940/DELNP/2007 has been refused by the Ld. Controller, Mr. Naveen Mathur and a patent (No. 299153) granted to Novo Nordisk after examination.

As provided in the decision, the invention covered by the application relates to an injection device/injector pen for administering a medical dose to a patient. In said device the numerals indicating the dose to be ejected from the injection device are displayed over an angle of rotation exceeding one revolution. Further, the numerals indicating the dose to be ejected are arranged along the helical path and displayed on a counting device thus increasing the accuracy in dose setting. Further, the invention uses torsion spring which accumulates and releases energy in an automatic manner.

The Opposition was filed on the following grounds:

(A) Claims 1 to 3 of the Application lack novelty.

(B) Claims 1 to 13 lack inventive step.

A hearing was fixed on 10/01/2018. The applicant’s agent attended the hearing but the opponent did not attended the hearing. The Controller however took the opposition and documents filed alongwith the same on record and considered the same. After considering the submission of the Applicant, the Ld. Controller held that the claim 1,2,3 are novel in view of the cited documents which relate to the use of compression spring which is different as compared to the present invention that uses torsion spring.

Also the opponents ground that Claims 1 to 13 lack inventive step was held to be not maintainable as the Controller held that the citations D1 to D15, alone or in combination, do not teach or suggest to a person skilled in the art, the claimed invention.

FIRST JUDGEMENT ON SEP AND FRAND IN INDIA

The Delhi High Court delivered India’s first ever judgement on standard essential patents.

Plaintiff, Koninklije Philips N.V.,  filed two suits being CS(OS) No. 1034/2009 and CS (OS) No.1082/2009 alleging infringement of its essential DVD Video Player patent, seeking the reliefs of permanent injunction, directions to the defendants to provide complete details, delivery, rendition of accounts, damages, etc.

The invention of Indian Patent No. 184753 relates to Channel (De) coding technology used for DVD Video Playback function in a DVD Video Player. It concerns ‘channel modulation’ which involves a coding step that is performed directly before the storage of the data. This coding ensures that the data to be stored on the disk has a particularly suitable structure for storage. The decoding of 16-bit code words to 8-bit information words is performed by “looking ahead” to the next code words.

Philips claimed that IN-184753 is an essential patent corresponding to US 5696505 and EP 745254B1 registered in USA and Europe respectively.

CS (COMM) 24/2016 was filed against the defendant Mr. Rajesh Bansal who is the sole proprietor of Manglam Technology (in short ‘Manglam’) which is an entity engaged in manufacture, assembly and sale of DVD Video players under various brands. Philips argued that the defendant’s DVD Video Players employ Decoders especially meant for decoding contents stored on optical storage media in accordance with the methods described in IN-184753, thus infringing the suit patent.

In the second suit, CS(COMM) 436/2017, Philips impleaded Bhagirathi Electronics (in short ‘Bhagirathi’) whose sole proprietor is K.K. Bansal, father of Rajesh Bansal. In the same suit, the third Defendant is the owner of the second defendant, Big Bazar which is an outlet which offers for sale inter-alia DVD Video players manufactured/ assembled by Bhagirathi.

In the written statement the Defendants argued primarily that the major components of the DVD players in question were procured by the defendants from authorized licensees like Sony, MediaTek, Sanyo, ST Micro etc. from China after due payment of all the taxes and custom duties. Hence the defendants were not indulging in infringement of the plaintiff’s suit patent having purchased the products from the duly authorized licensees of the plaintiff.

Both the suits were consolidated and common evidence was led. Plaintiff in support of its case examined two witnesses i.e. Farokh Bhiwandiwala as PW-1 and Ben Liempd as PW-2. Defendants also examined two witnesses i.e. S. Chandra Sekaran as DW-1 and Rajesh Bansal as DW-2.

On the basis of the pleadings of the parties 6 issues were settled. The issue and Courts finding in respect of them are as follows:-

(i) Whether the plaintiff No.1 is the proprietor of Indian Patent registered under No. 184753?

 (ii) Whether the suit patent of the plaintiff is invalid

  •  To prove that the plaintiff is the proprietor of the suit patent, plaintiff’s witnesses 2 exhibited the certified copy of the certificate of registration.
  • Patent validity was challenged by the Defendants on grounds of the claims being software and algorithm related. Therefore, a section 3 (k) argument was taken up during trial and final arguments.
  • However, as there was neither any pleadings nor any evidence led on this count by the defendants, challenge to the validity of the suit patent under Section 3(k) of the Patents Act based on no pleadings in the written statement was not considered.
  • Issue Nos. (i) and (ii) have therefore been decided in favour of the plaintiff and against the defendants.

 Next Court decided the issue of Essentiality (Issue (vi)) before other issues

(vi) Whether the suit patent is an essential patent in respect of DVD player technology?

  • The suit patent relates to “Decoding Device for converting a Modulated Signal to a series of M-Bit Information Words”. A perusal of the claim in the suit patent reveals that the same is equivalent to the claims 33 to 37 of the US No.5696505 and EP 0745254B1.
  • Defendant’s witness DW-1 in fact in his evidence by way of affidavit admitted that out of the claims in EP-0745254B1 claims 32 to 38 have been included in the Indian patent application,
  • Philips also filed reports which proved that the US and EP patents were found to be essential to the given DVD standards.
  • In view of essentiality reports and corresponding claims of patents, the Court held that Philips proved that the patent in India is also an essential patent

 (iii) Whether the defendants have infringed the plaintiffs’ Indian Patent No. 184753? OPP

  •  Plaintiff’s proved that the suit patent is a standard essential patent and the mere fact that the defendant uses a standard proves infringement.
  • However the plaintiff also proved infringement independently by the evidence of witness and the cross-examination of defendants’ witnesses.
  • Plaintiff witness deposed that he independently examined the defendants’ products using tests devised specifically for the purpose of determining the presence of EFM (eight to fourteen modulation) + demodulation technique and confirms that defendants’ DVD Video players were using the EFM+ demodulation technique, thus infringing the suit patent.
  • The defendants argued on the basis of doctrine of exhaustion that they were purchasing the chip from Shuntak (HK) trading Company and Sheenland Corporation who were the authorized venders.The Court however rejected the argument and stated that the defendants failed to discharge the onus to prove that both Shuntak and Sheenland were the licensees of the plaintiff and thus the plea that there is no infringement by virtue of doctrine of exhaustion was rejected.
  • The Court held that the Plaintiff’s has been able to prove that it is the owner of a standard essential patent, and thus the defendant’s products if manufactured, sold without license necessarily infringes the suit patent. The Court further noted the evidence of plaintiff’s witness who has explained the claim in the suit patent and compared the same with the products of the defendants to come to the conclusion that the defendants are infringing the suit patent by using the plaintiff’s patent IN 184753 in the DVD player sold by them.
  • The issue was therefore also decided in favour of the plaintiff and against the defendants

(iv) Whether the defendants had knowledge of the plaintiffs’ patents in respect of DVDs and the plaintiffs’ licensing programs?

 The court held that because it has been held that the plaintiff is the holder of a standard essential programme and also that the defendants have infringed the suit patent even if the defendants had no knowledge of the licensing programme they were in law bound to take the license from the plaintiff.

 (v) Whether the plaintiffs along with various other members of the DVD forum are misusing its position with a view to create a monopoly and earn exorbitant profits by creating patent pools? 

  • The Court after an extensive discussion of the various provisions of the Patents Act and the Competition Act held that the remedies as provided under Section 27 of the Competition Act for abuse of dominant position are materially different from the remedy as available under Section 84 of the Patents Act, thus the remedies under the two enactments are not mutually exclusive, in other words grant of one is not destructive to the other.
  • The Court held that there was no irreconcilable repugnancy or conflict between the Competition Act and the Patents Act, and, in absence of any irreconcilable conflict between the two legislations, jurisdiction of CCI to entertain complaints for abuse of dominance in respect of Patent rights could not be ousted
  • Thus whether creating of a patent pool by the bigwigs of the industry getting together amounts to an anti-competitive practice being misuse of the dominant position cannot be decided in the present suit. Hence this issue was held to be beyond the scope of the decision in the present suit.

 (viii) Whether the plaintiffs are entitled to a decree of damages or any other relief? OPP”

  • The Court held that the plaintiff is seeking royalty at FRAND terms and no evidence has been led by the defendants to rebut that these are rate were not FRAND terms.
  • The Court ordered the Defendants to pay royalty to the plaintiff @USD 3.175 from the date of institution of the suits till 27th May, 2010 and from 28th May, 2010 @USD 1.90 till 12th February, 2015. Royalty rates are further subject to interest of 10% per annum.
  • Considering the conduct of the Defendant and he being an ex-employee of the plaintiff knowing fully well with impunity infringed the suit patent was held also to be liable to pay punitive damages of ₹5 lakhs.

In view of the above, the Court decreed the suits in favour of the plaintiff and against the defendants holding that the said defendants have been infringing the suit patent IN-184753 which is an essential standard patent in respect of DVD video player, however, no injunction was granted to the plaintiff for the reason the plaintiff’s suit patent expired on 12th February, 2015.

A decree of actual cost incurred by the plaintiff including lawyer’s fee, the amount spent on court fee and the Local Commissioner’s fee is also passed in favour of the plaintiff and against the Defendants.

IPR (Imported goods) Enforcement Amendment Rules 2018 notified

Vide Custom Notification  dated 22nd June, 2018 , the government of India, amended the IPR (Imported goods) Enforcement Rules 2007. In the amendment, the words “patents as defined in the Patents Act, 1970”  appearing in Rule 2 (b) and “the Patents Act,1970” appearing in Rule 2(c) have been omitted.  This reduces the burden of custom authorities with examining patent infringement.

DISCUSSION PAPER ON ARTIFICIAL INTELLIGENCE (AI) BY NITI AAYOG

Recognizing AI’s potential to transform economies and the need for India to strategize its approach, Hon’ble Finance Minister, in his budget speech for 2018 – 2019, mandated NITI Aayog to establish the National Program on AI, with a view to guiding the research and development in new and emerging technologies. The paper was released on 4th June, 2018.

NITI Aayog has adopted a three-pronged approach – undertaking exploratory proof-of-concept AI projects in various areas, crafting a national strategy for building a vibrant AI ecosystem in India and collaborating with various experts and stakeholders.

This paper focuses on how India can leverage the transformative technologies to ensure social and inclusive growth in line with the development philosophy of the government and lay the ground work for evolving the National Strategy for Artificial Intelligence.

The AI ecosystem is essentially based on 5 pillars: policy makers, large companies, startups, universities and multi-stakeholder partnerships.

India’s approach to AI:

The strategy should strive to leverage AI for economic growth, social development and inclusive growth, and finally as a “Garage” for emerging and developing economies. NITI Aayog has decided to focus on five sectors that are envisioned to benefit the most from AI in solving societal needs:

  1. Healthcare: increased access and affordability of quality healthcare,
  2. Agriculture: enhanced farmers’ income, increased farm productivity and reduction of wastage,
  3. Education: improved access and quality of education,
  4. Smart Cities and Infrastructure: efficient and connectivity for the burgeoning urban population,and
  5. Smart Mobility and Transportation: smarter and safer modes of transportation and better traffic and congestion problems.

The report identifies the following barriers that are posed before India which need to be addressed in order to achieve the goals of #AIforAll:

  1. Lack of broad based expertise in research and application of AI,
  2. Absence of enabling data ecosystems – access to intelligent data,
  3. High resource cost and low awareness for adoption of AI,
  4. Privacy and security, including a lack of formal regulations around anonymisation of data, and
  5. Absence of collaborative approach to adoption and application of AI.

The paper proposes a two-tiered structure to address India’s AI research aspirations:

  1. CORE
  2. ICTAI

Further, data is one of the primary drivers of AI solutions, and thus appropriate handling of data, ensuring privacy and security is of prime importance. Challenges include data usage without consent, risk of identification of individuals through data, data selection bias and the resulting discrimination of AI models, and asymmetry in data aggregation. The paper suggests establishing data protection frameworks and sectorial regulatory frameworks, and promotion of adoption of international standards. In order for India to ride the AI innovation wave, a robust intellectual property framework is required.

Synergy of IP laws and AI:

Despite a number of government initiatives in strengthening the IP regime, challenges remain, especially in respect of applying stringent and narrowly focused patent laws to AI applications – given the unique nature of AI solution development. To tackle these issues, establishment of IP facilitation centers to help bridge the gap between practitioners and AI developers, and adequate training of IP granting authorities, judiciary and tribunals has been suggested.

AI and the world:

There has been tremendous activity concerning AI policy in different countries over the past couple of years. Governments in USA, UK, France, Japan and China have released their policy and strategy papers relating to AI. AI has the potential to provide large incremental value to a wide range of sectors globally, and is expected to be the key source of competitive advantage for firms.

Paradigm of AI:

An unrelated but interesting paradigm for AI application is the “AI + X” approach. Deployment can be viewed through the paradigm of “take an existing process, and add AI” or “AI + X”; where “X” can range from tasks such as driving a car, where AI can provide incremental value through improved routing and energy management, to act of sowing seeds, where AI can help inform decision making and improve productivity.

Key Challenges: Sector Wise

The preceding analysis of focus sectors – Healthcare, Agriculture, Education, Smart Cities and Infrastructure, and Smart Mobility and Transport, highlight the potential of AI tools and technologies in transforming the sectors and state of Indian economy as a whole.

However, analyzing across the focus sectors, the challenges are concentrated across the following common themes:

  1. Lack of enabling data ecosystems
  2. Low intensity of AI research
  3. Core research in fundamental technologies
  4. Transforming core research into market applications
  5. Inadequate availability of AI expertise, manpower and skilling opportunities
  6. High resource cost and low awareness for adopting AI in business processes
  7. Unclear privacy, security and ethical regulations
  8. Unattractive Intellectual Property regime to incentivize research and adoption of AI

Recommendations:

  1. Turbocharging both core and applied research. In addition, two frameworks for solving some of AI’s biggest research challenges through collaborative, market oriented approach have been proposed.
  1. Reskilling of existing workforce and preparing students for developing applied set of skills for the changing world of technology.
  1. In order to address these challenges one may focus on developing large foundational annotated data sets to democratize data and multi-stakeholder marketplaces across the AI value chain (data, annotated data and AI models).
  2. Lay down the challenges and suggestion for addressing some of these not so straightforward implementational challenges of AI.
  1. Re-skiiling of the current workforce; Recognition and standardisation of informal training institutions; Creation of open platforms for learning; Creating financial incentives for reskilling of employees;
  1. Indian education is in urgent need of transition particularly in subjects relevant to STEM, or computer based education and hence the implementation of AI.
  1. The major market segments for the increased AI adoption are:

(a) Private enterprises: mostly driven by market and enterprise considerations,

(b) Public Sector Undertakings: imperative to drive up the operational efficiency of PSUs, and

(c) Government: improve process efficiency, reduce human discretion, eliminate middlemen, advance prediction, pro-active and predictive service delivery to citizens.

Initiatives on promoting and adoption of AI in India:

  1. Creating a multi-stakeholder Marketplace
  2. Facilitating creation of large foundational annotated data sets
  3. Partnerships and collaboration
  4. Spreading awareness on the advantages AI offers
  5. Supporting startups

Ethics and AI:

One of the most tricky situation in implementing AI would revolved around privacy, ethics, fairness and tackling the biases in AI which would also include issues of transparency and opening the “Black Box”.

 

 

 

 

 

Ordinance to amend the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015

Government has notified an ordinance on May 3, 2018 to amend the Commercial Courts, Commercial Division and the Commercial Appellate Division in High Courts Act of 2015. The main Highlights of the Ordinance are:-

  • The pecuniary jurisdiction of the Commercial Courts’ has been widened. The value of subject matter of suit shall not be less than 3 lakhs in place of Rs. 1 crore.
  • With respect to the High Courts having ordinary original civil jurisdiction, the State Government may, after consultation with the concerned High Court, by notification, constitute Commercial Courts at the District Judge level.
  • With respect to a territory over which the High Courts have ordinary original civil jurisdiction, the State Government may, by notification, specify such pecuniary value which shall not be less than three lakh rupees and not more than the pecuniary-jurisdiction exercisable by the District Courts, as it may, consider necessary.
  • Except the territories over which the High Courts have ordinary original civil jurisdiction, the State Government may, after consultation with the concerned High Court, by notification, designate such number of Commercial Appellate Courts at District Judge level, as it may deem necessary, for the purposes of exercising the jurisdiction and powers conferred on those Courts under this Act
  • A suit, which does not contemplate any urgent interim relief under the Act, shall not be instituted unless the plaintiff exhausts the remedy of pre-institution mediation in accordance with such manner and procedure as may be prescribed by rules made by the Central Government.
  • lf the parties to the commercial dispute arrive at a settlement, the same shall be reduced into writing and shall be signed by the parties to the dispute and the mediator
  • The appeals from the judgments and orders of such ‘Commercial Division’ shall lie before the Commercial Appellate Division of the concerned high court
  • Any person aggrieved by the judgment or order of a Commercial Court below the level of a District Judge may appeal to the Commercial Appellate Court within a period of sixty days from the date of judgment or order.
  • The ordinance also inserts a new provision empowering the Central government to lay down rules for implementation of the Act

Patent Agent Examination to be conducted before December, 2018

As per a  recent notice issued by the Office of Controller General of Patents, Designs and Trademarks (CGPDTM), the Patent Agent Examination is likely to be conducted before December, 2018. Detailed information will be made available on official website http://www.ipindia.nic.in after finalization of schedule and other official requirements.