9/16/2013

1

Trends in Patent Litigation in India

Archana Shanker

Anand and Anand

4th September, 2013

MIP- China

Introduction

• Legal System

• IP Courts and Tribunal- Litigation Process

• Recent litigation before Courts

• Procedural and Strategy issues

• Fast – track and remedies

• Recent cases

• Patent Office /IPAB Trends

• Conclusion

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Legal System

The High Courts

23 High Courts in India

Original jurisdiction vests with 6 High Courts out of which Delhi, Bombay, Madras and Calcutta are most important

Delhi High Court handles 70% of the IP work

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IP – Courts and Tribunals

TM & Patent office Intellectual Property Appellate Board

High Court

Supreme Court Writs

Infringement suits and counter claim

Appeal

Revocation/ Rectification

Special Leave Petition

Special Leave Petition

Writ petition

Appeal

Patents: Pre – grant/ Post grant

TM: Show cause hearing/ opposition/

rectification

Writ

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Procedural and Strategies-Where and When and Options

• High Courts – in order of preference – Delhi, Madras, Calcutta and Bombay,

• When – Earliest eg BMS vs Hetero; Merck cases

• Options – patents Ex parte rare – Cease and Desist – get full defence

– Disadvantage – filing of cancellation before IPAB

• Simultaneous proceedings – – Infringement and counterclaim – Post grant

– Post grant and Rectification

• Customs recordal

Evidence

• Product purchased examined investigated – best such as in telecom

• Sometimes – cannot wait

• Pharma – RTI information re DCGI approval (Don’t annoy DCGI – arms length enquiry)

• Export information

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Trial design

• Witnesses –

– Avoid employees as sole witness

– Inventors and independent experts

– Expense can be reduced by cross examination through video conference facility or Local commissioners

– If overseas witness record before commissioners (3 day cross)

How much to disclose

• state more not less

• Public Interest –

– Pricing issues

– Investments on drug discovery

– Patient access programmes

– Donation camps, workshops to create awareness, government information

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Burden of Proof and Estoppel

• Burden in Pre and Post grant

• Burden in invalidation proceedings

• Burden in a Suit for infringement

• Estoppel – study patents of the opponent or defendant for concessions or admissions

Expectation

• Exparte injunctions rare – BMS, Philips VCD, Philips DVD (Anton Pillar only)

• Interim injunctions rare (Roche vs Cipla and TVS vs Bajaj)

• Rendition of accounts/status quo orders

• Undertakings – if product not launched

• Time – Suit 2 to 3 years – could be faster

– 6 months to 1 year in some cases

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Expectation

• Exparte injunctions rare – BMS, Philips VCD, Philips DVD (Anton Pillar only)

• Interim injunctions rare (Roche vs Cipla and TVS vs Bajaj)

• Time – Suit 2 to 3 years – could be faster

– 6 months to 1 year in some cases

• Cost – USD 20 to 100,000

• Damages – high probability

Expectation

What is a Status Quo order

An easier order to obtain than an ex parte order

Freezes things as they stand on the date of the

suit.

No launch = exparte injunction

If launched in a certain market/ segment of

buyers, confine sales.

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Expectation

• Exparte injunctions rare – BMS, Philips VCD, Philips DVD (Anton Pillar only)

• Interim injunctions rare (Roche vs Cipla and TVS vs Bajaj)

• Time – Suit 2 to 3 years – could be faster

– 6 months to 1 year in some cases

• Cost – USD 20 to 100,000

• Damages – high probability

Recent litigation before Courts

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Recent cases

• Novartis- Supreme Court • Infringement cases

– Ram Kumar vs Samsung (customs recordal) – Bajaj vs TVS; Phillips – Roche vs Cipla (patent valid / not infringed) – BMS, Merck, Schering

• Pre grants – Novartis, Gilead, Boehringer, Abraxis, Teva

• Post grants/ revocations – Enercon Valcyte, Pegasys, Pfizer, Combigan, Ganfort, Lapatinib

• Writs – Bayer and Syngenta (Linking argument) – Pfizer

• Incremental inventions- Section 3(d) - second tier for pharmaceutical patents

• Efficacy is “therapeutic efficacy” for pharmaceutical substances

• Coverage equivalent to disclosure in Indian patent law

• Proceedings and statements made in other jurisdictions in a different context (before stautory Authority) – can be treated as admissions in Indian proceedings

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• Lauded by the media

– Patents are anti – patients (Patents v. Patients)

• Chief Justice of India and Attorney General praise Alam J. on Novartis (and Kasab decision)

• Innovators have become more active in the press regarding need for patents

• Infringement action against NATCO

– A see - saw battle • Delhi High Court granted an ex – parte injunction

• Injunction suspended based on revocation order

• Based on Supreme Court judgment, injunction restored

• Injunction vacated based on second revocation order

• Injunction restored based on stay order by IPAB

– NATCO riding on orders in CIPLA’s proceedings

• Infringement action against BDR – Delhi High Court granted an ex – parte injunction

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Bayer v. NATCO (working)

• IPAB confirms the order of the Controller

• Clarifies ‘working’ requirement – fact specific analysis based on evidence

• Rejects argument on third party sales

• Finding of prima facie case does not require hearing

The Cumulative effect

• Pharma 3(d)- efficacy is therapeutic efficacy

• Coverage is equivalent to disclosure

• Section 8- Materiality and intent: not law

• POSA- 2 different persons

– Enablement

– Obviousness

• POSA not conservative and imaginative

• No evidence for simple inventions

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The Cumulative effect

• If claim obvious- amendment not looked into

• Delay and conduct- Amendment

• Partial anticipation- only inventive feature looked into

• Confusion on technical effect (lower processing time- not technical effect)

• Monsanto case- 3(j) interpreted for the first time

Fast Track Trials

• Strict Time Lines (eg. for Written Statement)

• Admission Denial on Affidavits

• Evidence through Affidavits

• Cross Examination before Commissioner (optional)

• Limitation of witnesses and cross (hours)

• Heavy Costs if Delay

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FINAL ARGUMENTS

Admission of suit Completion of pleadings Disposal of applications Admission/ denial Framing of Issues

Normal 6 months – 1 year

Expedited 2 – 3 months

PRE – TRIAL

Stages

Judge

Timeline

TRIAL

Stages Timeline

Judge

Evidence by affidavit

Expedited 3 – 4 months

Normal 1 – 2 years

Stages

Arguments by Plaintiff

Timeline

Normal 1 – 2 years

Expedited Upto 6 months

Judge

Reply arguments by Defendant

Rebuttal (rejoinder) arguments by Plaintiff

Recordal of evidence before Commissioner or Joint Registrar (including cross)

Stages of Litigation

Cross examination of foreign witness over video conference

(Mattel Inc. and Anr. v Jayant Agarwalla and Ors.)

Lawyers in India Witness in U.K.

Officer of the Indian High Commission

The Local Commissioner

Trial over video conference

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Statistics and Trends

Opposition trends

2013 2012 2011 2010 2009 2008 2007 2006 2005

Pre Grant 3 5 3 27 36 4 9 1 0

Post Grant 2 1 6 9 7 5 2 5 4

3 5

3

27

36

4

9

1 0 2 1

6 9

7 5

2 5 4

0

5

10

15

20

25

30

35

40

Opposition Trend

Pre Grant Post Grant

Nu

mb

er o

f

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Opposition Jurisdiction

Delhi Mumbai Chennai Kolkata

Pre Grant 55 12 21 3

Post Grant 11 32 16 10

55

12

21

3

11

32

16

10

0

10

20

30

40

50

60

Pre Grant, 88 Post Grant, 42

Opposition Trend: Win Rate

Total Decisions

88

Patent Rejected

45

Win % 48.9%

Total Decisions

42

Patent Revoked

25

Win % 40.5%

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4

0

10

1

6

9

61

11

9

6

2

0

29

13

0 10 20 30 40 50 60 70

Others

FMGC

Chemical

Software

Biotechnology

Mechanical

Pharmaceuticals

Technology Wise Trend

Post Grant Pre Grant

Number of Decisions

TRENDS IN PATENT COURT CASES

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DELHI, HC 39%

CHENNAI, HC 16%

KOLKATA, HC 14%

MUMBAI, HC 8%

GUJARAT, HC 8%

SUPREME COURT 6%

UTTARAKHAND, HC 3%

OTHERS 6%

COURT WISE DECISIONS ON PATENT CASES

PHARMA 24%

MECHANICAL 25%

CHEMICAL / MATERIAL ENGINEERING

13%

ELECTRICAL / ELECTRONICS 7%

SEMICONDUCTOR 4%

FMGC 4%

MEDICAL DDEVICE 4%

SOFTWARE / HARDWARE 1%

BIO-TECH 1%

OTHERS 17%

SUBJECT WISE COURT DECISIONS

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YEAR WISE TRENDS ON PATENT CASES (COURT, IPAB, PO)

2010 2009 2008 2007 2006 2005-1995

COURT 9 20 19 11 5 33

9

20 19

11

5

33

0

5

10

15

20

25

30

35

TRENDS IN SUCCESS RATE (COURT, IPAB, PATENT OFFICE)

PHARMA MECHANICAL CHEMICAL MEDICAL DEVICE

ELECTRONICS SEMICONDUC

TOR SOFTWARE FMGC

COURT 44.4 38.5 50 28.5 50 50

44.4

38.5

50

28.5

50 50

0

10

20

30

40

50

60

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SUCCESS RATE IN INFRINGEMENT CASES (COURT DECISIONS)

TOTAL NUMBER OF CASES NUMBER OF WINS SUCCESS RATE (%)

PRELIMINARY INJUNCTION 42 16 38%

PERMANENT INJUNCTION 4 2 50%

TRENDS IN IPAB CASES

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1 4 14

28

36

47

9

0

20

40

60

80

100

120

140

160

2007 2008 2009 2010 2011 2012 2013

NU

MB

ER O

F D

ECIS

ION

S

1 5

19

47

83

130

139

160

140

120

100

80

60

40

20

0

CU

MU

LATI

VE

CO

UN

T

NUMBER OF DECISIONS IS INCREASED OVER LAST THREE YEARS WITH 30% INCREASE IN THE YEAR 2012 AND 43% INCREASE IN THE YEAR 2011. 47 DECISIONS IN PATENT IN THE YEAR 2012 AS COMPARED TO 310 DECISIONS IN THE TRADEMARK

TRENDS: PATENT CASES IN IPAB

PRABHA SRIDEVAN AND D.P.S.

PARMAR, 79

S.USHA AND D.P.S PARMAR, 12

S. USHA AND S. CHANDRASHEKHARA

N, 28

Z.S.NEGI AND S. CHANDRASHEKHARA

N, 17

2011 2012 2013

CASES 36 34 9

36 34

9

0

5

10

15

20

25

30

35

40 PRABHA SRIDEVAN AND D.P.S. PARMAR

NUMBER OF DECISIONS IN PATENT CASE GIVEN BY PRABHA SRIDEVAN ARE 79 AMOUNTING TO 57% OF THE TOTAL DECISIONS OVERALL IN 6YEARS, 139 DECISION IN PATENT CASES ARE PRONOUNCED BY IPAB

DECISION DISTRIBUTION BY JUDGES

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APPEAL (30)

CONDONATION OF DELAY (17)

MISCELLANEOUS PETITION (11)

OPPOSITION/PATENTABILITY

/REVOCATION (50)

PCT APPLICATION (11)

OTHERS (20)

THERE ARE 50 DECISIONS (36%) ON REVOCATION AND PATENTABILITY. ALMOST IN ALL CASES ARE DECIDED BASED ON THE INVENTIVE STEP AND ANTICIPATION ENQUIRY EXCEPT ONE, YAHOO CASE, WHICH IS DECIDED ON THE SECTION 3(K) GROUND

ISSUE WISE DECISION TRENDS

2 4

19

30

42 45

0 0

12 13 15

18

0 0 1 1 1 2

0

5

10

15

20

25

30

35

40

45

50

2008 2009 2010 2011 2012 2013

NU

MB

ER O

F D

ECIS

ION

S (C

UM

ULA

TIV

E C

OU

NT)

CASES FOREIGN WIN

WIN RATE OF FOREIGN ENTITY IN REVOCATION PROCEEDING IS 11% (2 OUT OF 18 CASES)

YEARS 2008 2009 2010 2011 2012 2013

CASES 2 2 15 11 12 3

FOREIGN 0 0 12 1 2 3

WINS 0 0 1 0 0 1

TRENDS IN INVENTIVE STEP: FOREIGN PATENTEE

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2 4

19

30

42

45

2 4

7

17

27 27

2 3 4 5

9 9

0

5

10

15

20

25

30

35

40

45

50

2008 2009 2010 2011 2012 2013

NU

MB

ER O

F D

ECIS

ION

S (C

UM

ULA

TIV

E C

OU

NT)

CASES INDIAN WIN

WIN RATE OF FOREIGN ENTITY IN REVOCATION PROCEEDING IS 33% (9 OUT OF 27 CASES)

YEARS 2008 2009 2010 2011 2012 2013

CASES 2 2 15 11 12 3

INDIAN 2 2 3 10 10 0

WINS 2 1 2 1 4 1

TRENDS IN INVENTIVE STEP: INDIAN PATENTEE

Conclusion

• Strategy I: Move the court ASAP to attempt a status quo order;

• Strategy II; if product marketed don’t waste time on interim injunctions- go for a fast track trial;

• Strategy III: ask for damages both compensatory and punitive and interim deposits as in Philips vs. Bhagirathi case;

• Strategy IV: Deal with voluntary license requests in a business like way

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Conclusion

• Other forums (IPAB or Patent office)

• - Defendants look at world failure so bring success from other forums

• -Demystify the science (e.g. drug discovery)

• -Counter attack defendants for suppression , admissions estoppel etc

• Press to be moulded

• Appeal adverse orders ( don’t let them attain finality)

Questions?

archana@anandandanand.com