In review: key recent IP developments and trends in India

All questions

Recent developments

DecisionsFacebook, Inc v. Mr Noufel Malol

Bolstering the Indian jurisprudence and its recognition of well-known trademarks, an action for trademark infringement and passing off brought by Facebook was successful in restraining an entity 'Facebake', which was engaged in selling confectionaries and articles.⁴⁷ The Delhi High Court, in an ex parte ad interim injunction, restrained the entity from using the name Facebake and the logo 'F', and further from using its website www.facebake.in. The decision is significant because the restraint applied to an entity engaged in selling goods and services that were distinct from Facebook's, and it highlights how courts in India recognise famous and well-known trademarks.

FMC Corporation & Anr v. Natco Pharma Limited

The High Court of Delhi in the FMC case⁴⁸ adjudicated upon certain aspects of IPR disputes. It is pertinent to note that IPR disputes have been recognised as commercial disputes by the Commercial Courts Act, which modified Indian procedural law in so far as it applies to these disputes. On this point, the Court held that while the Commercial Courts Act charted a different regime for commercial disputes and that such disputes required a greater degree of circumspection, in the case of amending pleadings (documents such as the complaint) the Commercial Courts Act did not change the earlier practice. The Court held that the legislature in its wisdom saw fit not to adopt a different regime to amend pleadings for commercial disputes, and for that reason the older regime and principles of amendment continue to apply.⁴⁹

Furthermore, rejecting the defendants' contention, the Court also held that the concept of forum non conveniens was not applicable to civil suits.⁵⁰ This finding was premised on the concept that the plaintiff in a lawsuit is the dominus litus, implying that it may choose its forum, thus the Court held that despite a proceeding having been instituted by the defendants for declaration of non-infringement prior to the institution of the suit for patent infringement, the suit for patent infringement would continue. The Court also held that 'though a party may urge alternative pleas, conflicting stances, before the court of law, are to be eschewed'.⁵¹

Beiersdorf AG v. RSH Global Private Limited

In an action where the trademarks were different (Nivea versus Joy),⁵² the court, taking the IPR jurisprudence further, granted relief to the plaintiff by granting an ex parte ad interim injunction against the defendant, who was copying the plaintiff's trade dress. The court having first identified the unique characteristics of the plaintiff's trade dress held that as the defendant's product was very similarly packaged, even if not identical in shape and size, the defendant should be subject to a temporary injunction.⁵³ Accordingly, the court restrained the defendant.

Lundbeck & Anr v. Hetero Drug Ltd & Anr

Lundbeck filed a suit⁵⁴ seeking to restrain Hetero Drug Ltd from manufacturing and exporting substantial quantities of a generic version of vortioxetine to Latin America and Canada, alleging that this violated Lundbeck's patent in India⁵⁵ (notably, the export of a product from India also constitutes infringement under Section 48 of the Patents Act 1970). The defendant claimed to be exporting the generic for research and development purposes and therefore its acts did not constitute an infringement. The court observed that there was no material on record to support that statement and therefore did not accept the defendant's submission. Accordingly, in December 2020, the court granted an ad interim injunction in favour of the plaintiff restraining the defendant.⁵⁶

Subsequently, the defendant filed an application to export in accordance with Section 107A of the Patents Act 1970, the Bolar exemption in Indian law. Highlighting how the Bolar exemption can be applied in India while still balancing the intellectual property owner's rights, the court disposed of the application on the following terms:

1. The defendants must not commercially launch any product during the subsistence of the plaintiff's patent.⁵⁷
2. The defendants must furnish a statement to the plaintiff every six months during the subsistence of the plaintiff's patent containing the particulars and quantities of vortioxetine hydrobromide supplied to third parties whether in the domestic market or by export for research purposes prescribed under Section 107A of the Patents Act 1970.
3. The defendants must also furnish supporting documents showing that the active pharmaceutical ingredient (API) is being used for regulatory purposes only.
4. That at all times during the subsistence of the patent, the defendants must obtain declarations from all third-party customers that the purchase, sale and export of vortioxetine is for the purposes prescribed under Section 107A of the Patents Act 1970.
5. The defendants must also disclose the quantity of the API required by the law of the country to which the product is being exported, to perform the needed regulatory testing.

Dubai Islamic Bank v. Union of India

In this case, the court provided clarity as to a mark that is indicative of geographical origin, in terms of Section 9 of the Trade Marks Act 1999 on absolute grounds of refusal for a trademark.⁵⁸ The mark at issue was 'Dubai Islamic Bank – The better way to bank'. The court, in setting aside the order of the Trademark Registry, held that the mark ought not to have been refused simply because it contained an indication of geographical origin (i.e., Dubai).⁵⁹ Furthermore, the presence of the word Bank did not make the mark descriptive.⁶⁰ The court held that the mark was a composite mark and that the impugned order did not consider this composite nature along with the other elements, such as the presence of the slogan.⁶¹ Additionally, the court interpreted Section 9(1)(b), 9(1)(c), 9(2) and 9(3) as providing subjective standards rather than an objective mathematical standard, indicating the following.

1. if a mark is descriptive in nature but a secondary meaning is established, it may be granted registration; and
2. if the mark has a geographical name, it is not automatically disqualified for registration and distinctiveness can be established.

In addition, the court also directed that the applicant be granted a hearing before the Trademark Registry to place on record judicial precedent or material on which it sought to rely.⁶²

Renaissance Holdings Inc v. B Vijaya Sai & Ors

The Supreme Court recently pronounced its judgment in an appeal filed by Renaissance Holdings Inc, one of the world's largest and leading chains of hotels.⁶³ Renaissance had claimed infringement of its trademark 'Renaissance' and had sought a permanent injunction against the defendants' use of the mark 'Sai Renaissance' in any manner, and from operating in the hotels and hospitality services industry with the trademark Renaissance.

The defendants had been using the trademark Renaissance and its stylised representation on signage and business cards and leaflets, as well as on the premises of the two hotels they had been operating. The defendants contested the suit by stating that they had been using the mark since 2001 and that the word renaissance was commonly found in the dictionary. The defendants also contended that they were catering to a totally different class of customers from the plaintiff's.

The Supreme Court held that once it has been proved that a defendant has been improperly using a plaintiff's mark (irrespective of the improbability of deception given substantial differences in prices of goods or in their standard and quality), an injunction shall necessarily follow.⁶⁴ The Court further explained that in cases of similar goods and services, it is not necessary to go into the question of the reputation and goodwill of the plaintiff's mark. Pursuant to the provisions of Section 29(2), as long as the allegedly infringing mark is identical and deceptively similar and covers similar goods, the question of whether it is likely to cause confusion or not is a moot point and an injunction has to follow.⁶⁵

FMC Corp v. Best Crop Science LLP

In July 2021, the Delhi High Court clarified a number of patent law issues, including presumptive validity and prior claims.⁶⁶ The dispute had arisen with regard to patents for the product chlorantraniliprole (CTPR) – both the product patent, IN 201307, and the process patent for its preparation, IN 213332.

With regard to validity, the Court held that there is a clear-cut difference between a 'guarantee of validity' and a 'presumption of validity'. Hence, at the interim stage, it is sufficient if the defendant is able to make a case for the suit patent's vulnerability to revocation under the Patents Act 1970. However, this vulnerability has to be demonstrated by way of a credible challenge.⁶⁷

The Court did not accept the defendants' argument as to obviousness, and stated that the defendants had 'clearly cherry-picked' both their substitutions and the radicals for substitution in patent IN 204978 to arrive at CTPR. The Court clarified that for the specie patent to be invalidated on the grounds of obviousness the genus patent must provide sufficient basis to allow a person skilled in the art to arrive at the specie patent 'without unduly straining his imaginative and creative faculties'. The element of 'directness' must be there. The choices thus made by such a person must be apparent from the genus patent and not cherry-picked.⁶⁸

The High Court of Delhi Rules Governing Patent Suits 2020 (Proposed)

The Delhi High Court has floated draft rules to govern patent litigation lawsuits filed with the Court, which has been at the forefront of patent litigation in India over the past few decades.

To frame these rules, the Delhi High Court will be exercising powers under Section 158 of the Patents Act 1970. Should these rules be adopted, salient features and points that litigants in patent infringement lawsuits will have to comply with include the following:

1. filing claim construction briefs;
2. filing invalidity briefs;
3. filing infringement and non-infringement briefs; and
4. hot-tubbing.

Under Section 115 of the Patents Act 1970, the Delhi High Court may also engage scientific advisers to aid and assist the Court. In addition, the draft rules stipulate what ought to be contained in pleadings.

The proposed rules may come into force in the near future.

The Delhi High Court Intellectual Property Rights Division Rules 2021 (Proposed)

On 30 June 2021, the central government abolished the Intellectual Property Appellate Board (IPAB). Matters dealt with by the IPAB included the following:

1. patent revocation proceedings under Section 64 filed with the IPAB;
2. appeals from orders allowing pre-grant opposition under Section 25(1) of the Patents Act 1970;
3. appeals from post grant orders under Section 25(2) of the Patents Act 1970; and
4. original rectifications for a trademark under Section 57 of the Trade Marks Act 1999, and these are also now to be filed with the Delhi High Court.

Note that trademark applications in India can only be filed in five offices: Delhi, Mumbai, Madras, Kolkata and Ahmedabad. Thus, rectifications for trademarks granted by these offices would now be dealt with by the high courts in Delhi, Mumbai, Madras, Kolkata and Gujarat. Matters that were pending before the IPAB prior to its dissolution are now in the process of being transferred to the relevant high courts.

The Delhi High Court has been at the forefront of intellectual property litigation and recently passed the Delhi High Court Intellectual Property Rights Division Rules 2021.

Some of the salient features of the Rules are:

1. civil suits for trademark and patent infringement, and the revocation and rectification petitions, may come up before the same judge;
2. all writ petitions dealing with intellectual property disputes will come up before a single judge of the Delhi High Court; and
3. following the entry into force of the Rules in December 2021, the Delhi High Court has started to take up and exercise jurisdiction in matters previously dealt with by the erstwhile IPAB.

Needless to say, with the transfer of over 2,000 cases to the Delhi High Court and a sizeable number of cases to Mumbai, Madras, Kolkata and Gujarat, the burden on the high courts has increased.

Historically, prior to the advent of the IPAB in 2003–2007 for trademarks and for patents in 2007, all matters of this kind were in fact dealt with by the high courts.

In the past two decades, with the opening of the economy post-liberalisation and the impetus provided to entrepreneurs in the country, intellectual property disputes have increased manifold, which together with the additional burden of matters previously dealt with by the IPAB has created a pressing need for the high courts' capabilities to be augmented.

Trends and outlook

The evaluation of the recent legal developments, outlined above, clearly reveals the following trends.

First, the judicial decisions rendered by different fora despite the existence of the covid-19 pandemic highlight that the regime of the enforcement of IPRs is robust. The majority of the decisions and recent legal developments covered in this chapter were passed through virtual courts, by way of hearings that took place via videoconferencing. The diverse issues that the decisions touch upon highlight that intellectual property owners' rights were protected holistically during the pandemic.

Courts in India continued to protect the rights of intellectual property owners, by granting reliefs in various matters on the first day of the suit. Furthermore, the courts have passed orders that also balance public interest. In the Facebook decision, the court granted an ex parte ad interim injunction and protected Facebook's trademark against violation from an entity engaged in activities regarding confectionaries and articles. This highlights that courts protects trademarks that have immense goodwill and reputation, and they seek to stop defendants who may be engaged in activities related to different goods. Further, in the Biersdorf case, the court granted an ex parte ad interim injunction seeking to protect the plaintiff's trade dress, when the trademarks were different. In Lundbeck, the court did not accept the defendant's defence that it was exporting the patented product as there was no material on record, and proceeded to grant an ad interim injunction in favour of the plaintiff. Moreover, balancing and recognising the defendant's rights under the Bolar exemption provision of Indian law, the court thereafter passed an order permitting the defendant to export pursuant to the Bolar provision but protected the patentee's rights. In Dubai Islamic Bank, the court also provided clarity regarding registrability of marks, especially marks indicating geographical origin.

To address, and check, a trend whereby defendants, anticipating a lawsuit, would file a lawsuit for non-declaration of infringement in one forum and then use that prior-instituted suit to challenge the maintainability of the suit for infringement bought by a patentee, the courts interpreted the procedural provisions, and clarified the scope, of Indian law applicable in these scenarios. Simply put, the courts stated that a patentee is the dominus litus and has the choice of forum in which to institute the infringement suit, and the suit previously instituted by the defendant does not impact the maintainability of the infringement suit. Albeit interpreting Indian procedural laws, this decision, is in itself noteworthy as it sets an important marker regarding the protection of patent owners' rights.

In the Renaissance case, the Supreme Court clarified Section 29(4) of the Trade Marks Act 1999, stating that the plaintiff need not demonstrate the existence of goodwill and reputation in cases where a registration exists for a trademark and the infringing trademark is being used for identical or similar goods.

As regards obviousness in patents, the Delhi High Court held in FMC v. Best Crop that the claims of the genus patent must allow a person skilled in the art to arrive at the specie patent without straining the creative faculties, and the choices made must be clearly apparent for a specie patent to be invalidated on the grounds of obviousness.

These rapidly evolving changes ensure that intellectual property owners' rights are duly acknowledged and are being effectively enforced by courts as well as by tribunals and have remained unaffected by the pandemic. These trends indicate that the outlook is favourable for intellectual property owners in the times to come.