End to an interim injunction: TenXC decision announced

The Delhi High Court recently announced the verdict in the TenXC case/cases .  We have earlier blogged about the case here and here.  As expected, the interim injunction granted to the patentee, TenXC was vacated and the defendants were allowed to keep accounts till the time final verdict is announced; the patent has not been declared to be invalid.  This decision has clarified quite a few issues in Indian patent law and at the same time raised a few issues related to the practice at the Indian Patent Office (IPO).
Justice Midha, in this lucid judgment, reasoned:  “At this stage, this Court is not expected to and has not examined the challenge in detail to arrive at a definite finding on the question of validity of the patent which shall be examined at the  time of  trial.  However,  this Court is satisfied that the challenge made by the defendants is substantial, tenable and credible.” 
This post provides a brief overview of the decision and discusses a few practice pointers arising from this judgment related to reasons for allowance, and PCT practice.  In its decision, the Court opined that the defendants raised a credible challenge to the validity of the patent by raising pertinent issues re patentability.  The issues included grounds under section 3(d) [mere use of a known substance; under section 3(f) [mere arrangement of kn own devices; invention lacked novelty in view of art cited by the defendants; invention lacked an inventive step; invention was obvious to one of skill in the wireless telecommunication.  The Court listed several factors that led to the conclusion that the defendants raised a serious challenge to the validity of the patent.  These factors included:
i. Patent office did not conduct any investigation under Sections 12 and 13 of the Act  to ascertain the novelty and inventiveness of the claimed invention;
ii. Patent Office did not examine whether the invention  falls under any of the categories of  non-patentable inventions under Sections 3 and 4 of the Act;
iii. No valid publication; 
iv.  Amended application was neither published under Section 11A of the Act;
v. Patent granted on 9th June, 2010 by a non-speaking order and no finding recorded in the order to the effect that the claimed invention is novel and innovative; had not been anticipated by any previous publication or prior claim and that it does not fall in the category of non-patentable inventions under Section 3 and 4 of the Act;  
vi.  The plaintiffs did not disclose the Canadian Application No.2645740 to the Indian Patent Office which is violative of Section 8 of the Act and a ground for revocation under Section 64(1)(m) of the Act;
vii. The Patent Office has granted the patent to the plaintiffs in undue haste without following the due process of law;  
viii. The plaintiffs patent is a recent one.  The patent was granted on 9th June, 2010 and the suits were instituted on 22nd September, 2010, i.e., within four months;
ix. The plaintiffs contention that the Patent Office is not required to carry out the mandatory investigation and search under Sections 12 and 13 of the Act in respect of the PCT  applications is not convincing.  Sections 12 and 13 of the Act are mandatory;  
x. The International Search  Report  issued by World Intellectual Property Organization in respect of PCT application is not binding in view of Article 33(1) of the Patent Cooperation Treaty, which provides that the object of the International Preliminary Examination is to formulate  a preliminary and nonbinding opinion. Article 35(2) of the PCT provides that the International Preliminary Examination  Report  shall  not contain any statement on the question whether the claimed innovation is patentable or not according to any national law; 
xi. The findings of the ISR and IPRP are not binding on the Indian Patent Office, and cannot override the provisions of the Act especially on issues  of novelty and inventiveness. Reference to Sections 13(1) and (2) of the Act indicate that the duties set out therein for the concerned Examiner are mandatory, in view of use of the term “shall” in both provisions. It is therefore inconceivable that the statutory duties of the concerned Examiner to conduct a prior art search can be set aside or circumvented by reliance on the findings of the ISR and IPRP;
xii.  The Draft Manual of the Patent Practice and Procedure of the IPO cannot and  is not intended to override statutory provisions;
xiii.  The challenge to the patent made by the defendants is not unfounded and rather it raises a serious credible challenge to the patent and the same is discernible from the non-final rejection of the European Patent Office and the final rejection of the United States Patent and Trademark Office of the claims closest to those of the Indian Patent on the grounds of lack of novelty and inventive step. 
Practice Pointers:
For practitioners, at least a few of the above listed factors may prove to be troublesome.  These include the one related to a speaking order of a grant, publication post amendment, and the ones related to PCT applications.  
I.  The decision seem to indicate that the patent grant should have included specific finding related to novelty, and non-obviousness.  However, the fact that the grant did not include any such statement, goes against the patentee (in this case) and hence becomes estoppel.  So would this mean that each granted patent should include a statement to the effect that the claimed invention is novel and innovative; had not been anticipated by any previous publication or prior claim and that it does not fall in the category of non-patentable inventions under Section 3 and 4 of the Act? 
This situation is similar to the US patent case law where an Examiner’s unrebutted statement of allowance becomes prosecution history estoppel.  See for example US case law: (1) Zenith Labs., Inc. v. Bristol-Myers Squibb Co., 19 F.3d 1418, (Fed. Cir. 1996) holding [T]he examiner’s statement of reasons for allowance are an important part of the prosecution file history; and (2) Salazar v. Procter & Gamble Co., 414 F.3d 1342, 1347 (Fed. Cir. 2005) holding [N]ot addressing the examiner’s statement should not be treated by courts as acquiescence to the statement.
II.  The second issue which may prove to be troublesome that the general examination practice for PCT applications.  Our patent office generally issues an examination report when other patent offices have allowed or refused to grant a patent, i.e multiple examiners have looked at the application in different jurisdictions re novelty and obviousness and have a ready list of prior art. [Except that for this case, the examination and grant were fairly quick!!].  In a case where the examiner at the IPO agreed with the IPRP or the written opinion or an action from another jurisdiction, should the applicant insist on a specific statement in the examination report that the Examiner had considered all such art and agreed with the IPRP/written opinion/office action in another jurisdiction?
Tags: , , , , , , ,

About The Author

5 thoughts on “End to an interim injunction: TenXC decision announced”

  1. In big ticket patent litigation, no side is ‘fully’ happy at the end of the trial. Here the plaintiff’s are unhappy because the patent has not been invalidated and yet the injunction does not continue. The defendants are unhappy because costs have not been awarded to them despite the fact that they brought in a credible challenge. The public is unhappy because after so many hearings the matter is still not finally decided!!

    Joymee Mukherjee

Leave a Comment

Scroll to Top