Guest Post: The Power of IPAB to Stay the Operation of Patent

by Mathews P. George.

Mathews is a fourth year student of WBNUJS. He has previously posted on “Originality and Fair Dealing”.

The Intellectual Property Appellate Board (hereinafter IPAB), on the 13th of July, suspended the operation of patent held by Ramkumar. Professor Shamnad Basheer has discussed the development here. In this post, we shall discuss the vires of this Order.
The Order Sheet states as follows: “Counsel for the applicant present. Despite service of notice in M.P. Nos. 11 & 12/2009, none appeared on behalf of the respondent. In M.P No. 12/2009 Interim stay of operation of registered patent No. 214388 granted till September 2009. Let the matter be posted for hearing in the month of September, 2009. The Registry is directed to issue notice of hearing to both the parties. Accordingly, M.P No. 11/2009 stands disposed off.”

The character of this Order is very different from that of an ordinary temporary injunction restraining a defendant from pulling down a building in a property dispute. Although, the latter case involves pre-judgment interference with substantive rights, the substantive rights in toto are not suspended here. On the other hand, the Order of IPAB has the effect of suspending the rights of patent holder in toto during the stated period.

The default rule of statutory interpretation, as has been held in various Supreme Court judgments, is to give a statute its plain meaning. If the meaning so discerned is ambiguous, intrinsic and external aids, in the same order, shall be used for interpreting the statute. The concept of pragmatism gives interpreters an obligation to contribute productively to the statutory scheme.

IPAB derives its powers from Section 117-B of Chapter XIX of Indian Patents Act, 1970 for discharging its “functions under the Act”. It states that Section 95 of Trade Marks Act, 1999 shall apply to the Appellate Board in discharge of its functions under the Patents Act, 1970 as the Section applies to it in the discharge of its functions under the Trademarks Act, 1999. Accordingly, the Appellate Board has the powers to issue interim orders including grant of stay. However, it is difficult to discern the power to grant “stay of operation of patent” for the following reasons:
• Firstly, the statute is silent on the scenario of temporary revocation of patent. Section 53 lays down the term of patent to be twenty years from the date of filing of the application for the patent. It does not offer any other method for calculating the term of a patent.

• Secondly, the interim stay of operation of a registered patent amounts to temporary revocation of patent. It has the effect of granting the prayer for final relief of revocation of patent under Section 64 of Patents Act. Interestingly, the Andhra Pradesh High Court in Hyderabad Chemical Supplies Limited v. United Phosphorus Limited and Anr (2006(6)ALT 515), on a similar prayer, declined to grant the prayer for interim suspension of patent. The Court based its reasoning on the principle that an interim order which has the effect of granting the final relief can be made only in “exceptional circumstances”. The Court, in the instant case, declined to bring in the prayer for interim suspension of patent under the ambit of “exceptional circumstances”.

• IPAB is not bound by Civil Procedure Code as per Section 92 of the Trademarks Act. It, therefore, does not have powers akin to a High Court or a Civil Court in issuing interim injunctions. As already pointed out, even a High Court is barred from granting interim relief amounting to final relief. Section 92 requires IPAB to be bound by the principles of natural justice. Granting of interim relief amounting to final relief is against the principles of natural justice as interim relief is not granted on the basis of substantive arguments. The IPAB’s powers are clearly defined by Section 64 of the Patents Act. The final relief envisaged by this Section is the revocation of patent. A complete revocation of patent which is the final relief cannot be granted as an interim relief.

For the above mentioned reasons, the Order staying the operation of patent is ultra vires. As expected, the Order has already been stayed by the Madras High Court. Mint has reported this development here. The final judgment will hopefully settle down the dust pertaining to this question of law.

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