The Government of India published The Tribunals Reforms (Rationalization and Conditions of Service) Ordinance, 2021 on 4th April 2021. With the publication of this Ordinance, the Intellectual Property Appellate Board has been disbanded. Appeals in all appealable orders issued by the Patent Office and revocation petitions shall now lie before the High Court.
The Government of India introduced The Tribunals Reforms (Rationalisation and
Conditions of Service) Bill, 2021 in the Lok Sabha in February 2021. The Bill has been introduced with a view to streamline tribunals and proposes to abolish certain tribunals and
authorities and to provide a mechanism for filing appeals directly to the commercial court or
the High Court, as the case may be. The Bill proposes to abolish the Intellectual Property Appellate Board (IPAB) and if said Bill is passed, patents appeals and revocations which were previously adjudicated by the IPAB, will lie before the High Court.
By Amita Arora
The Designs (Amendment) Rules, 2021, have come into force on January 25, 2021.
The main features of the Amendment Rules are:
Inclusion of startups
Startups have been recognized as a category of applicant.
For claiming the status of a start-up, an Indian company has to produce the certificate of recognition from Department for Promotion of Industrial Policy and Internal Trade.
In the case of foreign entities, the entity has to fulfil the criteria for turnover and period of incorporation or registration as per Startup India Initiative and submitting declaration to that effect. Further, an affidavit as evidence of eligibility along with supporting document needs to be filed.
Two-tier fee structure
Earlier, the fee structure was a three tier structure, depending on whether the applicant was a natural person, small entity, or a large entity. However, under the present Rules, this has been simplified to a two-tier system, wherein the official fee for all natural persons, small entities, and startups is the same.
Service by email and mobile phone
The Amendment Rules now direct to provide an Indian cell phone number and email address in application Form 1 at the time of filing the application.
The difference in fees to be paid in cases of transfer of rights
In case an application processed by a natural person, startup or small entity is fully or partly transferred to a large entity, the difference, if any, in the scale of fees between the fees charged from the natural person, startup or small entity and the fees applicable for the new entity are to be paid by the new applicant along with the request for transfer.
Notably, in cases where a startup or small entity ceases to be a startup or a small entity due to the lapse of the period during which it is recognised by the competent authority, or its turnover subsequently crosses the financial threshold limit as notified by the competent authority, NO such difference in the scale of fees shall be payable.
Locarno classification system
The Amendment Rules pave way to adopt the Locarno Classification published by WIPO.
However, the relevant section also includes a proviso that registration of any design would be subject to the fulfilment of provisions of the Act specifically 2(a) and 2(d).
By Archana Shanker
Three orders, one after another in a span of 4 months, speak volumes.
Valuable rights of creators and the country’s image cannot be held to ransom by a handful of miscreants. The message is loud and clear from Hon’ble Justice Manmohan Singh and Hon’ble Sir Mr. B.P. Singh. The IPAB, in their order no. ORA/2/2020/PT/CHE (December 2020), expressed their concern over the opposition procedure currently being adopted by the Indian Patent Office that delays patent application indefinitely.
The IPAB held that a practice of filing serial oppositions and post grant procedure currently being adopted in furtherance of such practice is dangerous for healthy IPR regime in the country. The Hon’ble IPAB held that IP legislations in general are very balanced legislations and none should be allowed to misuse or abuse the provision of law.
This decision of the IPAB is one of the orders in the series of decisions issued by them, the first being in OA/2/2016/PT/MUM (Pfizer order) of August, 2020. In the Pfizer case, the Hon’ble IPAB was disappointed by the way pre-grant oppositions were being conducted by the Indian Patent Office and how they are being misused to serve commercial interest of infringing party at the cost of the innovator..
The IPAB in the said Pfizer order held
- that there should be no delay in protection of valid inventions particularly given the fact that the term of the patent is limited.
- The law provides that till such time patent is granted, it cannot be enforced
- that there are several stages for challenging the validity of patent including opposition and several years of term of patent are consumed before a patent is granted.
- The law provides that patents need to be granted as expeditiously as possible.
- Pre grant oppositions are being filed by imposters for fraudulent gain to delay the process of legislation and termed such filings as “Benami Opposition”.
The Pfizer IPAB order was challenged before the Bombay High Court in Dhaval Diyora vs. Union of India & Ors.. A two Bench Judge endorsed the view taken by the IPAB in relation to Benami opposition. The Bombay High Court further held that the credentials of pre grant opponents have to be established and Opponents who are habitual front men cannot be allowed to abuse the process of law whose sole intention is to delay the grant of patent.
The Hon’ble High Court further held that in a pre-grant Opposition, the locus standi of any person filing the opposition include researchers, non-government organization etc. in the interest of society. Upon reading of the High Court order what clearly emerges is that a pre grant opponent clearly needs to demonstrate a tangible interest with technical domain knowledge of the subject matter to which a patent application relates for it to be entitled in opposing the said application.
The last in the series, in ORA/2/2020/PT/CHE, the Hon’ble IPAB in a revocation petition addressed the issue of “interested person” under Section 64 read with Section 2(t) of the Indian Patents Act and laid down some guiding principles to curb such abuse of process of law and make recommendations to the Government which included:
- Changes in the electronic filing module ought to be made for expediting pre grant opposition so that no pre grant opposition is accepted where the application for patent is not subsisting.
- To curb filing of benami opposition, the Opponent must submit a valid Aadhaar card, voter ID card, passport, driving license to authenticate the identity and the e-filing system should be accordingly modified.
- Where there are a series of pre grant opposition that have been filed, the Controller should exercise his power under Rule 55 (3) which means that in each and every case of pre grant opposition, the Controller is not bound to give notice to the Applicant. The Controller has to first give his opinion which should be annotated in the patent application filed.
- That once the Controller has heard the parties and reserves the order, he should go ahead with the pronouncement of the said order even if the pre grant opposition is filed between the date he reserves the order and the date of pronouncement.
- If there are any subsequent pre grant oppositions, the Controller has to issue an opinion as to what evidence apart from what has been produced in previous cases has been provided to make the pre grant opposition maintainable.
- In so far as post grant opposition are concerned, the IPAB reiterated the decision of the Delhi High Court in Pharmacyclics vs. Union of India wherein certain principles ought to be followed.
- In so far as the definition of person interested is concerned, the IPAB clearly held that the Opponent has to demonstrate their interest with supporting documents for invalidating a patent which interest must be direct and tangible.
We hope that the Indian Patent Office adopts the said principles into the patent office manual and implements the changes in the e-filing module.
By Archana Shanker
The issue of notice of entitlement/ proof of right to file an application for patent has extensively been dealt with by the Hon’ble IPAB in their order dated 17th October 2020 in OA/63/2020/PT/DEL. This decision comes at the right time and resolves many inconsistencies and streamlines procedure governed by the Act and Rules, particularly for national phase applications.
Under Section 7 of the Indian Patents Act read with Rule 10 of the Indian Patent Rules, 2003 an Applicant has to submit Proof of Right for filing of the application (notice of entitlement from the inventors). This can be in several forms:
- Filing of executed Form 1 by the inventors;
- Filing of worldwide assignment/ confirmatory assignment / employment contract etc; or
- Filing of PCT 4.17(ii) declaration signed by the inventors.
In the case before the IPAB, the Patent Office rejected the patent application on a procedural issue of proof of right, despite the applicant having filed the WIPO cover page with PCT 4.17(ii) declaration in lieu of signed form 1 or assignment.
Section 7 (2) specifies the need for filing ‘proof of right’ in case the application is made by virtue of any assignment and states as follows:
Form of application
“….(2) Where the application is made by virtue of an assignment of the right to apply for a patent for the invention, there shall be furnished with the application, or within such period as may be prescribed after the filing of the application, proof of the right to make the application…..”
The said proof of right under Rule 10 has to be filed within a period of six months after the filing of such application furnish such proof.
For national phase applications, it is pertinent to mention Rule 20 and Rule 23(1) of the Patent Rules, in particular Rule 23(1), which reads as follows;
“23. The requirements under this Chapter to be supplemental of the regulations, etc., under the Treaty.—
(1)The provisions of this Chapter shall be supplemental to the PCT and the regulation and the administrative instructions made thereunder.”
Reference was also made to Chapter 5 of the PCT regulations in particular 51 bis.1 and 51 bis.2.
CHAPTER 5: SPECIAL REQUIREMENTS TO BE COMPLIED WITH IN CONNECTION WITH THE NATIONAL PHASE
The IPAB thus came to the conclusion that the legal requirement of filing of proof of right is met by filing declaration under Rule 4.17(ii) in respect of national phase applications.
By Devinder Singh Rawat
Indian patent application number 6000/DELNP/2007 claiming the compound Luseogliflozin, was opposed in a series of four pre-grant oppositions. The Controller of Patents has granted a patent on said application and has dismissed the four pre-grant oppositions vide order dated 19th November 2020.
The application was opposed on the grounds of lack of inventive step, non-patentability under Section 3(d), insufficiency and non-compliance of Section 8 of the Patents Act.
On the ground of inventive step, the Controller held that the cited documents “… do not explicitly disclose the compound of the claimed invention. And it is not easy for a person skilled in the art to conceive of modifying the prior art O-glucoside compound to arrive at Luseogliflozin, the C-glucoside compound. The cited documents do not ascertain clear and definite directions to make the compound in the claimed invention.”
Holding that prior art documents should be read as a whole and not in isolation and that a person skilled in the art would not randomly select particular substituents on particular positions of prior art molecules, the Controller emphasized that “….. a compound’s chemical and pharmacological properties do not result solely from its core or from individual substituents, but rather from the entirety of the molecule and how all its component atoms interact. Thus, the biological activity of a compound is based on the structure of the molecule as a whole. (Merck vs Glenmark 2015).” On the ground of non-patentability under Section 3(d), recognizing that the claimed invention cannot be derived from any prior art compounds, the Controller held that the claims relate to a new chemical entity, Luseogliflozin and not to a mere discovery of a known substance.
The Indian Patent Office has published the Patents (2nd Amendment) Rules, 2020 recently. Under this amendment the fees for small entities has been reduced and is now equivalent to the fees for natural persons and startups.
The Bombay High Court recently dismissed a writ petition challenging the order of the IPAB turning down the Petitioner’s pre-grant opposition filed after acceptance of an appeal against order of the Controller refusing a patent application.
The Respondent, Pfizer Products Inc., filed an application entitled ‘Chiral Salt Solution’ based on PCT application number PCT/IB02/01905 at the Indian Patent Office on October 27, 2003. The application was refused by the Indian Patent Office on March 27, 2014 following which an application requesting a review of the refusal order and then an appeal against the refusal order were filed. Following the grant of the application in Europe on October 27, 2014, the IPAB directed the Patent Office to examine the application afresh. The Patent Office re-examined the application and rejected it yet again on 3rd September 2015. An appeal against said refusal was filed at the Intellectual Property Appellate Board (IPAB) on September 14, 2015 and the hearing of the appeal was concluded on August 10, 2020. Meanwhile the Petitioner, namely, Dhavan Deyora filed a pre-grant opposition on August 18, 2020 at the Indian Patent Office and intimated the IPAB regarding the filing of the pre-grant opposition on the same date. The IPAB on August 21, 2020 dismissed the order refusing the application and also rejected the contentions of the Petitioner, holding that once an appeal is kept for pronouncement of reasons an application to the effect that an order should not be pronounced cannot be entertained.
The Petitioner approached the Bombay High Court with a writ petition against the order of IPAB dated August 21, 2020 on September 22, 2020 contesting that finding of the IPAB that no pre-grant opposition can be filed once an application has been rejected by the Controller of Patents, is contrary to the scheme of the Patents Act.
Decision of the Bombay High Court
On Factual Assertions of the Petitioner
The Petitioner had asserted that there was no reference to the appeal being allowed on August 10, 2020 in any handwritten endorsement or record of the IPAB in view of which the appeal should be considered to have been allowed only on August 21, 2020.
The Bombay High Court noted that in para 61 of the order of the IPAB, it has been noted by the tribunal that the hearing was concluded on August 10, 2020 and the appeal was allowed and was fixed for pronouncing the reasons on August 21, 2020. Noting a Supreme Court decision wherein it was held that when the court records as to what transpired before the court, it is conclusive of the fact stated, the Bombay High Court held that since the Petitioner has not placed anything on record to establish that the IPAB erroneously recorded allowance of the appeal on August 10, 2020 and reserving of the order for pronouncing reasons on August 21, 2020, the statement in the judgment of the IPAB dated August 21, 2020 must be accepted.
On law, the contention of the Petitioner was that any person has a right to oppose a patent application after it has been published but not granted and that a patent is not granted until it is sealed as per Section 43. In light of the same, the IPAB could not have directed the Patent Office to grant the patent even when they were notified of the filing of the pre-grant opposition.
The Bombay High Court ruled as follows:
On the stage at which pre-grant opposition can be filed:
The Court held that Section 25(1) read with Rule 55 direct that the applications seeking patent and pre-grant opposition have to be decided simultaneously and there is no separate hearing on the pre-grant opposition. Therefore, the right to file a pre-grant opposition u/s 25(1) commences with the publication of the application and continues till the matter is decided by the Controller but no further.
Before the amendment of 2005, a pre-grant opposition could only be filed by a person interested. The amendment of 2005 extended this right to any person in order to bring transparency in the proceedings before the Controller. Pre-grant oppositions assist the Controller in deciding the patent application and once the Controller decides the application, the scheme ends as far as the pre-grant opposition is concerned.
The Patents Act does not postulate following the same procedure before the Appellate Board. Appeal is not a continuation of the proceedings before the Controller which are not akin to a civil suit between Plaintiff and Defendant. When the Petitioner filed their pre-grant opposition, there was no application pending before the Controller in view of which the pre-grant opposition could not have been entertained.
On the Petitioner’s contention that the patent is granted when it is sealed and since the patent had not been sealed in accordance with Section 43, the pre-grant opposition was maintainable, the Court held that:
- The order of the IPAB allowing the appeal and directing the Controller to grant a patent was binding on the Controller and the Controller was duty bound to enforce the order of the IPAB by virtue of Section 117D(2) of the Patents Act.
- After the Controller has rejected a patent application but the IPAB allows said application in an appeal and directs the Controller to grant a patent, the matter moves beyond the first part of Section 43 and the patent stands granted. Only the ministerial acts of sealing of patent and entry in the register of patents remain which the Controller is duty bound to perform.
- If after the order of the IPAB, the Controller accepts a pre-grant opposition, it may give rise to endless oppositions and such an interpretation will violate the scheme of the Act.
On conduct of the Petitioner
The Court noted that the locus standi u/s 25(1) is not to create individual rights as such but to provide access to any person to assist the Controller in taking the correct decision.
Taking note that the Petitioner did not produce anything to support his credentials in invoking the writ jurisdiction of the Court and produced no statement on oath inspite of the Court questioning his credentials, and further that the Petitioner had filed several pre-grant oppositions, wherein he had raised detailed scientific grounds, the Court questioned how the Petitioner had intricate knowledge of the field of pharmaceuticals when he was in fact engaged in the diamond business. The Court thus expressed their doubt about the credentials of the Petitioner and found merit in Pfizer’s argument that he was in fact ‘a habitual frontman put up by those who intend to only delay the grant of patents’.
The conduct of the Petitioner in challenging what transpired in the hearing before the IPAB on August 10, 2020 could mean two things-
- One, that the Petitioner was not present during the hearing and if so, he cannot question the reference in the judgment of August 21, 2020; or
- Two, if the Petitioner was present during the hearing then he was keeping watch on the matter and the moment a decision in favour of the application was declared, the Petitioner rushed to file a pre-grant opposition.
The Court found either scenario to reflect poorly on the Petitioner and concluded that the conduct of the Petitioner was an abuse of the process of law.
In conclusion, the Court found the Petitioner’s pre-grant opposition not maintainable in law and imposed a fine of INR 25,000 in view of the conduct of the Petitioner and to convey the message that the right to oppose under section 25(1) must not be abused.
In exercise of the powers conferred by section 159 of the Patents Act, 1970, the Central Government has further revised the Patents Rules, 2003 and these rules would be called the Patents (Amendment) Rules, 2020.
The Rules have been amended particularly with regard to the requirements relating to working statements/ form-27. Some important changes are as follows:-
The Workings would now have to be furnished once in respect of every financial year ( not calendar year) , starting from the financial year commencing immediately after the financial year in which the patent was granted, and shall be furnished within six months from the expiry of each such financial year. (i.e., the due date would be 31st September and not 31st March)
Further, the form 27 is also revised and now one form may be filed in respect of multiple patents, provided all of them are related patents, wherein the approximate revenue / value accrued from a particular patented invention cannot be derived separately from the approximate revenue/value accrued from related patents, and all such patents are granted to the same patentee(s).
The revised form also does not require any statement from the Patentee /Licensee relating to public requirement of the patented invention, and if the same has been met adequately or not.
In a recent decision, the Hon’ble IPAB allowed an appeal and the matter has been remanded back to the Patent Office for reconsideration by a new controller. The applicant argued that a fair opportunity of being heard was denied to them. It was argued that two new documents were cited during the hearing, both in the Japanese language. The controller did not give the applicant an opportunity to submit counter arguments in respect of said new documents. It was also argued that the controller didn’t even wait for the prescribed period of 15 days to get the written submission of the appellant and refused the application on prima facie evidence of lack of inventive step. The IPAB on review of the decision, the hearing notice and the examination report, agreed that a fair opportunity had not been provided to the applicant and allowed the appeal. The application under question was remanded back to the Patent Office for reconsideration by a new controller.