Breaking News: Nitto Denko v. UOI: Delhi HC addresses Patent Application Pendency

Recently, the Delhi High Court kicked in some steps to clear the huge backlog at the Indian Patent Office in terms of clearing patent applications and devising effective strategy to maintain time bound processing of the applications. This post is about the latest order delivered by Justice Vibhu Bakhru of the Delhi High Court in the matter of Nitto Denko v. UOI.

In 2013, Nitto Denko went to the Court flagging inordinate delay in the examination of their patent applications by the Patent Office. It was also argued that this delay was in complete disregard of the time schedule provided Rule 24B of the Patents Rules, 2003 (“Rules”). This was one of the most crucial developments in the Indian IP arena and Madhulika had blogged about it here. As she pointed out, under the current state of affairs it takes around 5-7 years to grant a patent application (!) and these delays effectively reduce the patent term to 13 years. Mr. Pravin Anand, of Anand and Anand represented the petitioner and Senior Advocate Pratibha Singh was the amicus in this case. You may read the order here.

This is the latest in a slew of developments to improvise the Indian Patent Office of late. I blogged about the integration of various new features into the search system at the Patent office recently here.

To quickly recapitulate, in November 2013, the Court asked the Controller to show compliance of Rule 24B. An affidavit was directed to be filed with respect to steps being taken at the Patent Office to ensure that Rule 24B(2) and (3) are observed. The Controller was also directed to state the year-wise pendency of applications until November 2013, and the estimated time by the Patent Office to clear the backlog.The Controller promptly filed an affidavit with the required information with the Court disclosing the steps to clear backlogs at the Indian Patent Office in a time bound manner.

The Government then appointed a Committee in December 2013 to address and formulate solutions to clear the pendency, specifically:

a. to come out with a programme for time-bound disposal of the pending patent applications.

b. to suggest ways and means to ensure that fresh applications can be decided within the statutory time limit fixed in this regard.

After two meetings, the committee submitted its report in March 2014. Justice Vibhu Bakhru of the Delhi High Court delivered the instant order.

On the issue of pendency, the Government took certain measures such as by increasing the manpower at the Office. However, the Court observed that the measure was not sufficient to reduce the pendency to a stage where the Controller can issue the examination reports within the prescribed period. Since the measure was inadequate, the parties were asked to suggest ways to clear back log of pending applications in a time bound manner. After considering the suggestions, the Court directed the Government [1]to increase its manpower in the Patent Office by implementing the scheme of Modernisation and Strengthening of Intellectual Property Offices (MSIPO) within the next 9 months; pump in more money (apart from Rs 300 crores sanctioned already) to train and recruit examiners; to explore alternative means of recruitment through UPSC, IIT and GATE/NET examinations; implement the flexible complementing scheme to address and check high rate of attrition in the Patent Office.

Further, the Court directed the Government to constitute another committee to consider
the following:

(i) If expedited examination is not considered feasible, whether waiver of maintenance fee for the delayed period or other measures could be considered in order to compensate the patentees for the time consumed in the examination process.

 (ii) As to whether the examination of patents applicants could be carried out of turn under the existing provisions of the Patents Act,   1970 and Rules made thereunder and if so, under what circumstances? What factors and terms and conditions to be considered for expedited or out of turn examination?

These questions are extremely pertinent. Under section 14(2) the patentee is required to pay a “maintenance fee” from the third year onwards, but under the present state of affairs, the maintenance fee is a burdensome added cost when the patent application itself takes 5-7 years to process. The Committee is expected to deliver a report March 2015.

[1] From the order:

1. The Ministry of Commerce and Industry and other concerned Ministries to take urgent steps so that posts proposed in the plan scheme of  Modernisation and Strengthening of Intellectual Property Offices (MSIPO) could be created within a period of 9 months to enable issue of first
 examination reports within reasonable time.
  
2. The Government to consider additional outlay apart from Rs.309.6  crores already approved by the cabinet Committee under the 12th Plan for   creation of further posts of Examiners and Recruitment/Training of the  newly recruited examiners.
  
3. The Government will further expedite the creation of posts sought   under the 12th Plan in consultation with Department of Expenditure and   Department of Personnel and Training within a period of 9 months.
  
4. The DIPP/Government may explore alternative methods of recruitment of examiners through    UPSC, IITs or by using the second obtained through GATE/NET examination.
  
5. It is also directed that efforts should be made to ensure that the Flexible Complementing Scheme as approved by the committee is implemented   at the   earliest in consultation with other concerned departments specially Department of Personnel and Training and the Department of
Science and Technology for immediate implementation in the Indian Patent Office in order to resolve the issue of attrition.

6. The Government is directed to constitute a committee[ referred to in the part above].