In LG Electonics India Pvt. Ltd v. Bharat Bhogilal Patel & Others, Delhi HC vide its interim order pulled up Customs Dept. for restricting clearance of consignments which, as per latter’s determination, allegedly violated patent. It was held that the Customs Commissioner (Imports), one of the defendants, violated Clause 4 of the Notification No.305/96/2004-FTT videCircular No.41/2007-Customs dated 29.10.2007 (“Notification”) and therefore, exceeded its jurisdiction. The judgment was not unanticipated considering that the Notification unequivocally precludes the Customs Dept. from initiating any action in case of infringements pertaining to patents unless the offences have already been established by a judicial pronouncement in India and the Customs is called upon or required to merely implement such order.
We had earlier blogged about Mr. Bharat Bhogilal Patel’s patents [covered hereand here]. It was also mentioned that Mr. Patel tried to replicate the Ramkumar saga by enforcing his patents under the IPR (Imported Goods) Enforcement Rules, 2007 in a bid to have the Customs Authorities impound all imports allegedly infringing his patents.
A brief summary of judgment
The defendant No.1, Mr. Bharat Bhogilal Patel held a process patent titled “A Process of manufacturing engraved design articles on metals or non-metals”. Last year, Mr. Patel filed complaint against the plaintiff, LG Electonics India Pvt. Ltd and various other importers before the Customs Commissioner alleging that they were importing products which infringed his patent rights. The Customs Commissioner issued an Order restricting the clearance of plaintiff’s consignments.
The plaintiff challenged the Order, contending that the Order was in breach of Clause 4 of Notification which sets out instructions for implementation of IPR Enforcement Rules. Clause 4 reads as follows: “It is pertinent to mention that while the mandatory obligations under Articles 51 to 60 of the TRIPS dealing with border measures are restricted to Copyright and Trade Marks infringement only, the said Rules deal with Patents, Designs and Geographical Indications violations as well, in conformity with the practice prevailing in some other countries, notably EU countries. While it is not difficult for Customs officers to determine Copyright and Trade Marks infringements at the border based on available data/inputs, it may not be so in the case of the other three violations, unless the offences have already been established by a judicial pronouncement in India and the Customs is called upon or required to merely implement such order. In other words, extreme caution needs to be exercised at the time of determination of infringement of these three intellectual property rights.”
In the light of clause 4 of the Notification, it was rightly held that the Customs Dept. could not initiate any action in case of infringements pertaining to patents, design and geographical indications unless the offences were established by judicial pronouncements. As there was no judicial pronouncement restraining the plaintiff from infringing the impugned patent in the instant case, the Customs Commissioner violated Clause 4 of the Notification and therefore, exceeded its jurisdiction. Further, the Customs Department could not prima facie restrict clearance of plaintiff’s consignments on the basis of alleged patent or complaint filed by Mr. Patel. Considering the aforesaid, the plaintiff was granted ex-parte ad-interim injunction.
H/T: On behalf of Spicy IP, I thank Mr. Irfan Modi for drawing our attention to this case.