In an extremely surprising order, Justice Sistani of the Delhi High Court passed an ex-parte interim injunction, on the 16th of September, 2011 against Symed Laboratories Ltd. in a lawsuit filed by Vifor (International) Ltd., a European Pharmaceutical Company for the violation of its Indian patent no. 221536. It must be noted that the patent has been granted to Vifor (International) AG i.e. the Swiss parent company and not Vifor (International) Ltd, which is the entity that has filed the present patent infringement suit. This could mean that, unless the Delhi High Court Registry has goofed up by inserting ‘Ltd.’ instead of ‘AG.’, an Appellate Court will have to set-aside the injunction on the grounds that the suit has been filed by the wrong group company. (Image from here)
The patent in question claims a water soluble iron carbohydrate complex of a particular weight and which has been derived through a specified process which is also covered by the patent. Claim 1 of the patent is reproduced as follows:
1. Water soluble iron carbohydrate complexes obtainable from an aqueous solution of iron (111) salt and an aqueous solution of the oxidation product of one or more maltrodextrins using an aqueous hypochlorite solution at a pH-value within the alkaline range, where, when one maltodextrin is applied, its dextrose equivalent lies between 5 and 20, and when a mixture of several maltodextrins is applied, the dextrose equivalent of the mixture lies between 5 and 20 and the dextrose equivalent of each individual maltodextrin contained in the mixture lies between 2 and 40, wherein the obtained iron complexes have an average molecular weight of 80 kDa to 400 kDa.
I now reproduce below the operative part of the ex-parte injunction granted by Justice Sistani:
Plaintiff has filed present suit for permanent injunction restraining infringement of Indian Patent no.221536, delivery up, rendition of accounts and damages. It is stated that the plaintiff through its comprehensive, clinical and scientific development programmes has invented an iron replacement product portfolio consisting of its product Ferinject?, Venofer? and Maltofer?.
Mr.Anand, also submits that the patent in the suit relates to the plaintiff?s invention, which is novel water-soluble iron carbohydrate complex and a process for preparing the same.
The certified copies of the plaintiff?s certificate for its Indian patent No.221536 have been placed on record. It is submitted that plaintiff has learnt recently that defendant no.1 who is also involved in manufacture and marketing of bulk pharmaceuticals products, has launched an infringing product ?iron carboxymaltose also known as ferric carboxymaltose? from defendant no.1 and 2?s website http://www.symedlabs.com and subsequently from the other third party websites wherein defendant is advertising and offering for sale its infringing version of ferric carboxymaltose compound also known as iron carboxymaltose. A screen shot of the website of defendants showing their advertisement and offer for sale of the infringing iron carboxymaltose has been reproduced in the plaint. The plaintiff has also extracted a reference chart showing the infringement by the defendant of the plaintiff?s patent. It is submitted that the conduct of the defendant is also in violation of the provisions of The Drugs and Cosmetic Acts 1940. Learned counsel also submits that patent of the plaintiff is valid for 20 years since 2003 in India and is renewed till 2012. Hence, counsel for the plaintiff prays for an ex parte interim injunction.
Issue summons in the suit and notice in the application to the defendants, returnable on 15.12.2011.
I have heard counsel for the plaintiff and perused the plaint, application and the documents and am satisfied that this is a fit case for grant of ex parte injunction and in case ex parte injunction is not granted, plaintiff will suffer irreparable loss and injury. Accordingly, defendants, their directors, employees, officers, servants, agents are restrained from making, selling, distributing, advertising including on its website http://www.symedlabs.com and third party websites, exporting offering for sale, and in any other manner, directly or indirectly, dealing in any product that infringes the subject matter of IN?536.
Provisions of Order 39 Rule 3 CPC be complied with within seven days.
The Supreme Court precedents on the grant of ex-parte orders: On this blog, we have time and again criticized Indian courts for granting ex-parte orders in extremely complex patent infringement suits. Shamnad had touched on some of these issues in an earlier post criticizing the Madras High Court for granting such an order in a patent infringement suit filed by Roche against Matrix. There are several Supreme Court precedents on the circumstances in which the Court may grant an ex-parte order. Shan had blogged about one such decision earlier. Apart from that case there is also the case of Union of India v. Era Educational Trust & Morgan Stanley Mutual Fund v. Kartick Das where the Supreme Court of India slammed the general practice of granting ex-parte interim injunctions in civil suits. The general principles laid down in these cases are as follows:
(a) whether irreparable or serious mischief will ensue to the plaintiff.
(b) whether the refusal of ex parte injunction would involve greater injustice than the grant of it would involve;
(c) the court will also consider the time at which the plaintiff first had notice of the act complained so that the making of improper order against a party in his absence is prevented;
(d) the court will consider whether the plaintiff had acquiesced for sometime and in such circumstances it will not grant ex parte injunction;
(e) the court would expect a party applying for ex parte injunction to show utmost good faith in making the application;
(f) even if granted, the ex parte injunction would be for a limited period of time.
(g) General principles like prima facie case, balance of convenience and irreparable loss would also be considered by the court.
A
s is obvious from the order of Justice Sistani, hardly any of the above factors have been considered by the High Court. The Judge has not even indulged in the basic cursory discussion on how the denial of an ex-parte order would cause irreparable injury to the Plaintiff. The other deficiencies in the case are as follows:
(i) The ‘Claims’ of the patent are not even reproduced or discussed in the order. How can an ex-parte order be granted without even referring to the main claims?
(ii) The Court does not explain how it has assumed jurisdiction especially when the Defendant is situated in Hyderabad and not Delhi.
(iii) There is also no discussion on whether the Plaintiff is even selling the product in India.
Conclusion: Nevertheless, at the end of the day, this order is a rare victory for the pharmaceutical industry in India and they should savour it for as long as it lasts.
Prashant,
This is the standard kind of language used by the judges of Delhi High Court. In fact there is some discussion at least. The requirement of the provisions of proviso to order 39 rule 3 are that the court must record the reasoning that in case the ex parte interim injunction is not granted the purpose of granting injunction will be defeated by delay. Justice Sistani has not reproduced the language as stated above, but at least has stated that he is satisfied this is a fit case for grant of ex parte injunction and in case ex parte injunction is not granted, plaintiff will suffer irreparable loss and injury.
Of course there is one thing that the notice in the application (along with the summons in the suit) has been issued for 15th December, 2011, while as per the provisions of Order 39 rule 3, the court granting the ex parte injunction order would endeavor to decide the application under order 39 rule 1 & 2 within the period of 30 days from the date of grant of the ex parte interim injunction and if it is not decided within 30 days, the judge is to record the reasons for that. The fact that the very first date is 15th December, 2011 is not digestible. But then you will rarely find the orders where ex parte injunction is granted where the first date fixed is within the period of 30 days what to speak of disposing off the application within 30 days. You would be the luckiest person on earth if you get the application heard and decided within 30 days. I am yet to see any such case.
From the language and the details that have been mentioned in your blog it seems that you are personally involved/interested in the case, or at least you know too much about the case much much beyond the ex parte order.
This is not new for him! I can provide you with atleast 2 more such orders, albiet they being trade mark infringement suits. Ex parte injunctions were granted with the order containing almost the same language as reproduced in the post by you, with no observations as to how a prima facie case was made out, what was the urgency, balance of convenience, etc. In one of our cases, he, after granting an ex parte injunction, made notice returnable after three months. Subsequently, on the 39 rule 4 application, again the notice was made returnable after 45 days. Compliance of Order 39 Rule 3 was to be done in 10 days. Such an order is in gross violation of Order 39 Rule 3, 3A and 4 of the CPC and also in contraiction of atleats 3 supreme court judgements and 2 Delhi High Court DB Judgements, one being as latest as the year 2010. in all these cases, procedure under order 39 rule 3, 3A, and 4 was,inter alia held to be mandatory.
We filed a FOA against this order, which was dismissed by DB citing practical difficulty of the original side judges to dispose of interim applications as per the procedure under Order 39. the Db refusedto follow the coordinate bench judgements, and supreme court judgements as mentioned above, giving rise to the question – What is the purpose of Article 141 of the constitution? and if tribunals can be made to follow procedure prescribed under statutes, then why is the original side of the DHC allowed to not follow procedure prescribed under law? Maybe the “legislature does not think before penning down the provisions”! Great!!
@ Anon: I’ll take your last line as a compliment since I churned out the above post without having any personal interest in the case. You obviously have not been following the blog, this isn’t the first time we’ve made obvious our displeasure at ex-parte orders in patent cases.
@ Mohit: I wouldn’t put the blame solely on Justice Sistani. He’s just following the norm at the Delhi High Court. Interestingly, there are actually more District Judges giving very detailed ex-parte orders or at any rate much more detailed than the Judges of the High Court.
Best,
Prashant
@ Prashant: Not my intent to blame him. But definitely criticize the practice of granting ex parte orders and making notice returnable after so much delay. And i dont agree that this is the practice in DHC…on the contrary, other judges on the original side, and i dont hesitate to name them 0 Justice Gita Mittal, Justice V.K. Jain, Justice Bhatt, Justice Manmohan Singh, have been very good in passing detailed orders when granting ex parte stay.
Prashant,
Nice to know that you have no personal interest in the matter and you have repeated your displeasure for the ex parte order in a patent case. But let me ask you why it is that you are scary about the ex parte orders in patent cases and not in Trade Mark or for that matter other IPR Laws cases. YES I have been reading your blogs since only recently. I have scrolled and seen the older blogs as well and noted your displeasure for the ex parte orders.
I remember justice Jaspal Singh and Justice G.C.Jain in Delhi High Court. They were deadly against ex parte injunction orders. It is not only IPR cases but all cases.
One thing has been noticed that if you are a plaintiff and got the ex parte interim injunction order you have won the case more than 70% by the stroke of that ex parte order whether you have the case or not. The reason is that the defendant would not be heard for months together. I have used the word “months” giving conservative approach (as there are cases where the defendants have been heard in months), but it would not be surprising that it may take more than 30 months (remember the law says for the disposal of the application within the period of 30 days). I am aware of the matter (of course in Delhi High Court) where the application under order 39 rule 1 & 2 remained un heard for 9 years (unbelievable?).
You have rightly said that more District judges (read Additional District Judges) who pass more detailed orders at least much more than the High Court Judges. But in those orders too you will not find the language as stated above (being the requirement of proviso to order 39 rule 3).
Since we are talking about ex parte orders, let me tell you that at least there is a judge (now-a-days posted in Patiala House Courts Complex). She has almost the set language of the ex parte orders, several of which have been vacated on filing of the appeal against the said ex parte orders, by Delhi High Court. She ahs many of IPR cases which belong to one particular advocate and that when she was earlier in Patial House Courts, his cases were listed before her (before 23rdrd August, 2010 when the cases were shifted to Saket Courts) when she was shifted to Saket Court. Nevertheless, the said advocate started filing NEW CASES invoking the jurisdiction of Saket District Court and his cases were listed before this particular Additional District Judge. She is again now in Patiala House Courts and the said Advocate has started invoking the jurisdiction for Patiala House Courts and now his cases are again being listed before this very Additional District Judge. INVARIABLY the ex parte ad interim injunction orders have been passed in his cases. What an Advocacy and what a nexus/link. WHAT WOULD YOU SAY PRASHANT FOR THESE EX PARTE ORDERS?
Hi Anon,
I think ex-parte orders should not be granted in any IPR cases except under the most dire circumstances. Grant of such orders especially in patent cases is extremely objectionable for the simple reason that unlike copyrights and trademark, a patent case is usually too complicated for a lay-man judge to comprehend on his own. He needs the assistance of counsel and expert witnesses to come to an assessment on patent infringement and validity. Cases of copyright and trademark infringement however are much more simple and can be understood by even a common man.
With regard to the Patiala House judge, I must say it is unfortunate. Such nexuses should be snapped.
Best,
Prashant
Justice VK Jain passed an injunction order when a junior counsel for the Defendant sought an adjournment since his senior was out of station.