Government of India issued an ordinance “The Tribunals Reforms (Rationalization and conditions of service)” on 4th April, 2021 by which the Indian Patent Appellate (IPAB), wherever it appears in the Patents Act 1970, has been deleted. Thus, IPAB is no more in existence now. All the cases pending before the IPAB are now to be transferred to the High Courts.
Background of IPAB
The Appellate Board was constituted by a notification on 15th September 15, 2003, to hear appeals against the decision of the Registrar for the issues related to trademarks under the Trademarks Act 1999 and was subsequently extended on 2nd April, 2007 to the patents under the Patents Act, 1970. Thus, the Appellate Board was authorized to hear and decide upon the appeals against decision, order or direction of the controller of the patent office.
The rules required that each bench of IPAB includes a technical member and a judicial member. A person who possessed a degree in engineering / technology or a post-graduate degree in science with at least 10 years of experience as a registered patent agent or had worked as a controller for at least 5 years, was eligible to become a technical member. In other words, the constitution of The Board was done in a manner that the technical member had enough exposure and training to understand the technical nuances of the patent related issues while the judicial member was well versed in the matters of law. The Board could hear appeals, for example, if an application was refused by the controller for the lack of novelty, inventive step or industrial application. The applicant could put forth evidence and substantiate support for novelty, inventive step or industrial application. The Board could overturn refusal of application if convinced of the argument and supportive evidence of the applicant. Similarly, an applicant could seek redressal from the Board on a number of issues under various sections specified in The Patents Act 1970.
At the same time, The Patents Act 1970 also empowered any person interested to file objections to a patent application / patent office decision before the Appellate Board. The expense involved for such a process was minimal. The process of appeal was also simple. An application in a prescribed form was enough to make an appeal to the Board. Thus, the system provided a robust checks and balances outside the patent office and a court of law, whereby an applicant or any person interested could seek redressal / remedial measures from the Board.
It is not clear as to what prompted the Government of India to disband IPAB. One of the reasons seems to be that the Board had only one member for a long time instead of two members required as per the law. In view of non-fulfilment of quorum of two members, one of them being chairman of the Board, the cases could not be heard. The pending cases therefore, kept on mounting. Appointment of the Board members rests with the Government of India. After the appointment of Chairman of the Board in the recent past, a large number of cases were decided in a short time frame.
It is also said that the government sought to reform the tribunal system in the country to ensure “speedy justice”.
Issues arising post disbanding of IPAB
With the introduction of ordinance for disbanding IPAB, a number of issues have arisen which need to be addressed. The issues and corresponding suggestions are listed below:
- Any person interested approaching a court of law
Now with the disbanding of the Appellate Board, if any person interested finds that an application is not fulfilling some provisions of The Patents Act 1970, would he / she dare to approach a court. Let us presume that an interested person finds that an application lacks novelty and inventive step. Would he / she find it convenient to approach a court of law to point out that an application lacks these steps? It is obvious that approaching a court of law would involve hiring a lawyer who understands IPR and that would be quite expensive. The interested person may no more be interested in approaching a court of law, simply for pointing out lack of novelty or inventive step in an application. There may now be appeals in the courts only when large commercial interests of an interested person are involved. With the disbanding of IPAB, an interested person, who does not have commercial interests, but certainly has scientific and technical interests, would avoid taking the route through a court. It is not to suggest that the patent office grants frivolous patents but mistakes do happen in any patent office worldwide. The Board was the right agency where such observations could be filed by an interested person in a simple way and without much expense.
- Applicant approaching a court of law
With the disbanding of IPAB, in case an application is now refused on the grounds of non-compliance with the requirements of the Patents Act 1970[1], the applicant shall have to approach the court for redressal. So is the case with disputes regarding division of application[2] , dating of application[3] , anticipation of application[4] and patent of addition[5]. Such cases involve only an applicant and the patent office which exercises quasi-judicial function. Would an applicant of a start-up company or an individual, who does not have adequate financial resources, approach a court of law to seek redressal of these issues? It would certainly be a cumbersome and an expensive indulgence. The Board was the right agency where the applicants could seek redressal in a simple and inexpensive way.
Such cases of redressal are different from the patent enforcement / infringement cases and need to be addressed in an economical, quick and time bound manner. It is suggested that a mechanism needs to be created by which issues involving only an applicant and a patent office are addressed. The courts could have scientific advisors for assisting the speedy disposal of such cases. Such processes need to be economical, otherwise it would disincentivize individuals, start-ups and small companies who are now active contributors to the intellectual property. IPR is an important element for stimulating growth of small companies and start-ups and no country can afford to disincentivize intellectual property growth.
- Retention of guidelines and precedents of IPAB
The Appellate Board has delivered a number of valuable judgments since inception and has also laid down guidelines for various issues related to the patents. For example, while deciding the case regarding filing of a divisional application of Esco Corporation USA, IPAB laid down guidelines for formal and substantive grounds for filing a divisional application. The formal grounds were general guidelines for the applicants filing a divisional application whereas the substantive grounds guide the patent office for a divisional application. One of the substantive guidelines is reproduced here and states, “Even though the Patent Rules provide statutory powers to a Controller regarding a divisional application, such statutory powers need to be used judiciously. If a Controller takes objection for unity of invention, the divisional application shall not be disallowed, provided it meets other statutory requirements”. The IPAB in the instant case was a torch-bearer both for the applicant as well as the patent office. The order laid the ghost of a “divisional application” to rest.
Patents rules worldwide have introduced the concept of a person skilled in art (PSITA) for assessing inventive step of an application without defining his /her abilities and limitations. Several judgements worldwide have tried to define a PSITA. The important pillar for grant of a patent is how a PSITA views an application from the point of view of inventive step. IPAB has delivered landmark judgements defining the abilities of a PSITA. While deciding the case related to Glaxo Limited (Glaxo) and Fresenius Kabi Oncology Limited[6], it held that a PSITA is not a dumb and ignorant character. He / she is aware of the happenings in her field and has skills to perform experiments with the knowledge of the state of the art. Similarly, in the case of Allergan India Private Limited vs. Ajanta Pharma Limited Inc.[7], the Board stated that PSITA has common sense and is expected to be motivated by reasonable success from prior art.
There are many more such judgements which have guided both the applicants and the patent office in IPR matters. It would not be possible to cite all of them.
Section 2 u(B) of The Patents Act 1970, which has been deleted with the ordinance, states that “prescribed” means,- in relation to proceedings before the Appellate Board, prescribed by the rules made by the Appellate Board”. There are a large number of judgements, prescribed rules, guidelines which have been framed by the Appellate Board over a period of time. Some of the rules, guidelines issued by the Appellate Board have been mentioned herein above. What would be the fate of these prescribed guidelines and the rules post deletion of section 2u(B) of The Patents Act 1970?
We cannot afford to lose such valuable prescribed guidelines and the rules issued by the competent Appellate Board over a period of time in the form of orders. Ignoring them would be like re-inventing the wheel. It is suggested that the guidelines issued by the IPAB should be retained and judgements delivered by the Appellate Board should serve as a precedent for the court cases that come up for litigation now. IPAB had created a dedicated website www.ipab.gov.in and under the services head, is another head of orders issued by the Board with respect to various cases. Some of the orders issued by the Board are listed there. It is suggested that all the orders may be listed there, so that the guidelines and judgements are readily available.
- IPR trained judges assisted by advisors / technical experts handing IPR cases
All the cases pending before the Appellate Board shall now be transferred to the High Court. Are our courts / judges equipped to handle the backlog and the cases related to IPR that shall come up in future? Would it have been advisable to create first special IPR courts before disbanding IPAB?
Before answering the question, let us look worldwide how various countries have amended their jurisprudence to deal with IPR related cases.
IPR laws are complex and the patent applications are filed in diverse and cutting-edge technologies. The courts will have to deliberate not only on issues arising out of the complex IPR law but issues arising out of facts related to science and technology. Some of these technologies may be clear only to those professionals who have knowledge and experience in the field.
India, like many other countries, is a signatory to the World Trade Organization’s Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) for effectively protecting and enforcing IP rights. Although TRIPS does not mandate setting up special courts for protection and enforcement of IP rights, many countries have spared a thought and came up courts which specialize in handling cases related to IPR. Some of courts are named as under in various countries:
- The Patent Court[10]
- The Intellectual Property and International Trade Court[11] and
- The Court for Intellectual Property Disputes[12].
Taking a specific case of China, it has Basic People’s Courts, Intermediate People’s Courts, High People’s Courts, and the Supreme People’s Court. All the Basic Peoples’s Courts and High People’s Courts including the Supreme People’s Court of China have specialized IPR divisions. Almost all the Intermediate People’s Courts also have specialized IPR courts. All these courts have a large number of IPR specialized judges. The specialized IPR court of Supreme People’s Court was set up in 1995.
Apart from the special courts, most of the countries have Appellate Boards. For example, United States Patent and Trademark Office (USPTO) has an administrative law body called The Patent Trial and Appellate Board (PTAB) which decides the cases of patentability. PTAB further has an Appeals Division and a Trial Division and is headed by a Chief Administrative patent judge. Similarly, China has a Re-examination and Invalidation Department in the patent office. China has also created IP Tribunal of The Supreme People’s Court. EPO has instituted a Board of Appeal.
Although Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts have been created and a separate Commercial Division have been created in the High Courts of India to deal with commercial matters, which inter-alia includes IPR matters, there are no specialized IPR courts.
It would have been advisable for India to create robust specialized IPR courts first, like many other countries have, so that the backlog of the cases pending with IPAB and the cases that come up in future were dealt with in an effective manner. Most of the countries have strengthened their patent related boards as the specialized IPR courts of law while India decided to disband the Board without having any specialized IPR courts. Disbanding of IPAB, without putting in place a robust jurisprudence for handling IPR cases, is certainly a retrograde step.
It is suggested that now at least steps should be initiated so that the Indian jurisprudence has specialized IPR courts. It may not be possible to come up with specialized IPR courts overnight. In the meanwhile, judges who have an understanding of the IPR or have a science / technology background or are known to have a scientific temperament, may be selected to hear IPR cases. A good number of judges may be simultaneously exposed to IPR and related educational programmes. Rajiv Gandhi Institute of Intellectual Property at Nagpur could play a stellar role in organizing IPR programmes for judges. It is also suggested that only a limited number of judges may be exposed to such trainings and then these judges could gain further experience while deciding the cases. It is also possible that if a judge is handling IPR cases only, he / she may feel fatigued or feel that his career may be stunted. It may, therefore, be feasible to continuously train judges and post them for a specific period of time for handling IPR cases.
It is also suggested that the judges should be able to avail the services of technical experts / assistants / advisors during hearing of cases. These experts could advise the judges on the technical facts.
- Simplification of evidence procedure
The court procedures in India are relatively time consuming. In order to ensure quicker decisions, it is suggested to simplify the process of evidence for deciding the cases. One of the steps in the right direction was the introduction of “hot tubbing” by The Delhi Court which allows experts to give evidence in the presence of each other and in the presence of judges so that experts are cross examined to arrive at quick conclusions. More such measures need to be introduced for making the evidence process simple and less time consuming.
Having a robust, responsive and experienced jurisprudence for handing IPR issues would ensure quick, consistent and predictable decisions. The consistency and predictability of the decisions of courts in the matter related to IPR is of utmost importance. Such decisions give confidence to the applicants, investors, researchers and MSMEs and have a direct bearing on the development and growth of a country.
It is very important for a developing country like India to have specialized IPR judges assisted by the technical and scientific advisors. IPR subject is ever evolving and therefore, the judges need to be regularly exposed to IPR. How IPR matters are handled in the courts here, does not have a ramification only for India but for the world as a whole. Intellectual property is filed globally and the applicants file it in the countries of their interest. It is important for India to have an interesting, efficient and a robust IPR system so that foreign as well as local investors, applicants and assignees have the confidence of quick and predictable outcomes in case IPR matter which lands in a court of law. Therefore, India must do everything within it means to ensure retention of the confidence of investors, applicants, researchers whether from India or abroad. Creating a specialized IPR jurisprudence with quick and predictable outcome would show the world, resolve of the government as to how important IPR is for the country. It has assumed greater significance as India was ranked at 48 among 131 countries in the global innovation index 2020 and had moved up 4 places since 2019.
