Saturday, October 27, 2012

Snippet: USPTO Issues Non-Final Rejection of Apple’s Bounce-back Patent

In what must surely come as a rude-shock to Apple, the USPTO has issued a non-final rejection (available here) of Apple’s patent over the “bounce back/rubber band” feature which Apple successfully asserted against Samsung in the US.

The non-final rejection was issued in an ex parte re-examination of the patent US7469381. It has been reported that Samsung has brought this development to the notice of District Judge Lucy Koh who presided and continues to preside over the Apple-Samsung patent trial.

All 20 claims of the patent were invalidated, including claim 19 which claims the bounce-back feature.
I thank Ms.Jaya Bhatnagar for sharing this development with me.

Sunday, October 21, 2012

Snippet: Delhi High Court Passes “John Doe” Order for the Movie “Chakravyuh”

On October 19, 2012, in a suit instituted by Eros International, C.S.(O.S.) 3163/2012, the Delhi High Court issued “John Doe” order against unknown defendants in relation to the film “Chakravyuh”, besides restraining named defendants such as Jyoti Cable Network from communicating, making available, distributing, duplicating, displaying, releasing, showing, exhibiting in the film in any manner without obtaining prior authorization/license from Eros International.

I thank Ms.Sneha Jain for bringing this development to my attention.

Saturday, October 20, 2012

Snippet: Cipla Abandons its Patent Application

In an interesting development, Cipla has abandoned its patent application 733/MUMNP/2004 relating to “A combination of Azelastine and steroids” which had 50 claims.  The application was abandoned after a pre-grant opposition was filed against it. Here is the 8-page decision delivered on October 14, 2012 by the Mumbai Patent Office, of which 6 pages contain only the claims of the application.

Friday, October 19, 2012

Division Bench of High Court uses “Hyperbole” defense to Stay Injunction on the use of “Bata”

In what must certainly be one of the fastest appeals and decisions, in a 10-page judgment delivered on October 17, 2012, a Division Bench of the Delhi High Court has stayed (not set aside as I had incorrectly written) the order dated October 15, 2012 of the Learned Single Judge restraining the allegedly defamatory use of the trademark “Bata” in the song “Mehngai” in the movie “Chakravyuh”.

Following are the relevant excerpts from the decision of the DB:

“3. The issue raised in the appeal is of great public importance in the context of fundamental rights of the citizens to freely express themselves on social issues and thus we would be inclined to hear detailed submissions in the appeal but are constrained to pen this short order inasmuch as the cinematographic film in question is scheduled to be released in India on October 24, 2012.  Only two more working days remain as per the calendar of this Court before the Autumn recess commences.  The appellant seeks a stay of the operation of the impugned order.  

4. We are informed that as far as the international premier is concerned, the movie in question has already been launched with a premier show held in London on October 11, 2012 and that the offending lyrics in the song have been on the “You Tube” by way of promotionals since mid September 2012.

5. Since the appeal came up for hearing today in the forenoon and we do not have the requisite time to view the cinematographic film we take on record the statement made by the learned senior counsel appearing for the appellant as well as for the first respondent that the theme of the cinematographic film is the burning social issue of disparity in the distribution of wealth created in the nation : Fight of values and thought between the  “haves” and “have nots”.  

We are informed that the textual setting of the cinematographic film reflects a class struggle between the State,  which is perceived  by a section of the society to be capitalist oriented, vis-à-vis those who believe that  the social philosophy of the State should be of a kind which facilitates a fair distribution of the wealth created i.e. meets the need of all and the greed of none.  It is this esoteric thematic setting which finds an exoteric expression in the movie which shows to the viewer the struggle between the Maoists and the State.

13. Mr.Sandeep Sethi, learned senior counsel appearing for the appellant urges that notwithstanding four business houses being named in the song, the understanding of the song would not be with reference to a particular house but to a class which propagates the ideology of industrialization. And, brings out a call to those who propagate the ideology of socialism to unite and fight.

Following are the operative portions of the order:

19. The movie raises a burning social issue which we find is a matter of public debate on the streets and the press.  The struggle between the “haves” and  the  “have nots”.  The struggle for political power and the control over the philosophy of the State.  

20. Would the traditional legal principles evolved by Courts on the subject of rhetorical language or hyperbole be sufficient guidance for Judges to resolve issues when expressions are used with respect to social issues?  Is a question which needs to be seriously considered and answered.  

This is the reason why we are deferring hearing but penning our thoughts as aforesaid to bring out the richness in the public debate and especially in the modern societies where contemporary entities compete in the interdependent industrialized world and perhaps in this competition the individual organized industry of the common man renders him incapable of fighting an organized industrial establishment. 

To wit : When a prosperous person goes into depression and commits or attempts to commit suicide, what else is the phenomenon other than the individual organized industry falling apart against the onslaught of modernization.

21. Seen with the viewpoint as herein above, we do not prima facie find that in its contextual setting, viewed and heard as a whole, the song is derogatory or defamatory of the House of Bata.  Four leading and well-known industrial houses have been named and the statement naming them is prima-facie not likely to be taken literally by the viewer/listener.  

22. Deferring further hearing of the appeal till November 07, 2012, the operation of the impugned order is directed to be stayed.

The rational appears to be that given the backdrop of the story, use of the names of popular business houses is a reference to capitalism, and not a targeted assault on the entities per se.

Considering that a good section of the audience is not capable of making such a nuanced distinction, I am not sure I agree with the rationale. Also, would the logic of the Court’s decision apply even to public individuals who enjoy a clean reputation?...

Wednesday, October 17, 2012

Delhi High Court Restrains use of the mark “Bata” in a Defamatory Song

In a 66-page judgment delivered on October 15, 2012, a Learned Single Judge of the Delhi High Court has restrained the makers of the movie “Chakravyuh” from “releasing, transmitting, distributing, exhibiting, performing or communicating to the public by any means or technology, aural or audio visual performance of the impugned song “Mehngai using  the name of the plaintiff therein till final disposal of the suit.”

The relevant extracts of the lyrics of the song in which the name “Bata” is used is as follows:

“Birla Ho Ya Tata Ambani Ho Ya Bata,
Apne Apne Chakar Mein Desh Ko Hai Kata
Birla Ho Ya Tata Ambani Ho Ya Bata
Apne Apne Chakar Mein Desh Ko Hai Kata
Are humre hi khoon se inka engine chale
dhakadhak, Aam admi ki jeb ho gai hai safa
chat, aam aadmi ki jeb ho gai safachat.”

The lyrics refer to corporate corruption in the country and name prominent Indian business houses, including popular footwear maker “Bata”. Among other things, Bata filed a “quia timet”/pre-emptive action suit for infringement of its trademark/name, passing off and defamation. Summing up the issues in the case, the Court noted as follows:

“15. In the facts of the present case, the core issue involved is whether the defendants have transgressed the right to freedom of expression and speech through the song “Mehngai”. Another important question to be answered by this Court in the present case is whether pre-emptory injunction can be granted by the Court to restrain the defendant from transmitting and exhibiting the said song “Mehngai”   or the only remedy is to claim damages after proving such defamation in trial.”

Citing decisions of the Supreme Court, the Court noted that motion pictures had a deeper impact on its audience that books and that the freedom of expression under Article 19(2) was not absolute. Applying the principles enumerated in SC’s decisions and those of the Delhi High Court, the Court observed thus in Para 25 on the facts of the case:

“25. Applying the above enunciated principles, in my considered view in the present case in the song in question, the defendants  have used expressions that are offensive towards the plaintiff.  The tenor of such expressions   suggests that the engines of the industries of the plaintiff are run by the blood of the common public.  

Such expressions undoubtedly have the propensity to cause lasting damage to the well established reputation of the plaintiff and in my view the use of the said expression would certainly harm and jeopardize the credibility and reputation of the plaintiff in the estimation of the common public. This Court also cannot find any justification for the use of such derogatory expressions   in the song and such expressions prima facie cannot stand the test of either fair comment or based on truth or in the public or societal interest.”

The context of the Defendants’ contention that the movie had been cleared by the Censor Board and that no objections were raised by the Plaintiff on the Censor Board’s decision to clear the movie along with the allegedly defamatory song, the Court observed thus:

“In my considered view, none  of the above contentions   raised  by the counsel  for the  defendants  could   justify the  act of the defendants  in using  the name  of the plaintiff   with such a disparagement  to the extent of attributing that the plaintiff  has looted  the country and  that they are running their industry by the  blood of the people.  

This is no doubt a serious attack on the reputation and goodwill of the plaintiff   and with the use of such defamatory expressions the defendants cannot take shelter by using the same with a disclaimer.  Even otherwise it is  inconceivable that the   use of a  disclaimer    in any  way can help so  far transmitting  of the said song on You-Tube, through CDs or other media sites is concerned as  the  disclaimer will confine to the viewers of the film and not to all those who will merely listen the song.”

On whether Bata’s suit was barred by the Cinematographic Act which governs grant of viewership certification to cinematograph films, the Court’s views are definitely worth reading:

“27. This court also does not find any merit in the contention  raised  by the counsel  for the defendant  that the remedy of the plaintiff to file a civil suit is barred  due to the remedy  available  to the plaintiff under Section   6 of the Cinematographic Act 1952.  There is no provision in the  Cinematographic Act 1952 which  excludes the jurisdiction of the civil court to try and entertain a civil suit.

It is a settled legal position that a provision of law ousting the jurisdiction of the civil court must be strictly construed and exclusion of the jurisdiction cannot be easily inferred unless such exclusion is either explicitly expressed or clearly implied.  This court also does  not find   any specific provision  in the Cinematographic Act which  can  grant  an urgent and immediate  relief to the grievance of an individual  in a case  like  the present  where  the grievance  of the individual  pertains  to intending loss of its reputation  and goodwill. 

The entire scope of Cinematographic Act is to regulate the exhibition of films for evolving and entertaining the society through  the film makers, exhibitors and the connected  team  with such activities  and define the role of the Central Board of Film Certification  and of the Central Government. 

The Act does not specifically provide for any remedy or grant any such relief to redress the grievances of the individuals or private citizens and institutions etc. against screening  of any film or objectionable scene in the films Ordinarily, the courts do not interfere with the decision taken by  expert bodies, but that would not  imply  that the citizen whose fundamental rights are violated is left  remediless and that the recourse to approach  the court to  challenge the decision of the expert body is not available”

Para 30 of the judgment for me is a must read in order to understand the balance to be struck between artistic license and responsibility:

"30. At omega, this court would like to observe that cinema is not only an entertainment industry but also a potent weapon for social change. From a six to a sixty year old, everyone derives and takes home something from a movie and it has the power to evoke emotions and shape the outlook of the common man towards various issues like none other. The film makers have since yore mirrored social ills plaguing the society which movement continues till date with igniting the minds and being responsible for various social movements leading to monumental changes in the social setup.

However with this responsibility to bring to the public domain the realities of our diverse nation, there comes a duty to act cautiously not to make inroads in the lives and dignity of people and institutions alike in the garb of being the messiahs of social change. Thus the film makers have no unbridled right   to tarnish the image and reputation of any individual or institution, that too in the absence of any foundation  for  the same. One cannot be oblivious of the fact that the  main stay of the film industry is not only entertainment but also commercial gains  and  in  this pursuit to  earn huge profits the cinema makers  have no  right to trample upon,disrepute or disparage  the reputation of others.”

Tuesday, October 16, 2012

Cipla’s Appeal in Sunitinib Matter Dismissed by Division Bench of Del HC

In a 4-page order dated October 12, 2012, the Division Bench of the High Court has dismissed Cipla’s Letters Patent Appeal.

As stated in my last post, Cipla had preferred a Letters Patent appeal against the Learned Single Judge’s order dated October 8, 2012 restraining it from marketing its drug until October 15, 2012 (yesterday). The said order was passed in a writ petition filed by Sugen Inc against the post-grant opposition dated September 24, 2012 revoking Sugen’s patent on Sunitinib.

In its Letters Patent appeal, Cipla has raised precisely the question as I had in my last post. No interim stay order had been granted by the Learned Single Judge on the post-grant revocation of Sugen’s patent, and yet Cipla was restrained from marketing its drug. Apparently, although Sugen sought a stay, a stay was not granted, instead an injunction was granted against Cipla. 

Here is Para 4 of the order:

“4. This order is questioned on the ground that on the application for stay along with writ petition, the learned Single Judge had not  granted any interim order and only directed notice,  when second  application for stay with similar prayer was filed, the learned Single Judge entertained and granted the above order.  Further, in the absence of any prayer for direction to the appellant herein not to take any steps for marketing its drugs, the learned Single Judge should not have granted such an order. "

Despite noting the above, the Division Bench of the HC which was presided by the Hon’ble Chief Justice of the CH, held as follows:

“6. We have considered the above submissions.  On perusal of the order under appeal, it is seen that though the learned Single Judge has on 05.10.2012 only ordered notice in first stay application filed by the second and third respondents returnable by 15.10.2012, but having noticed that in the absence of stay, the appellant was intending to market the product before 15.10.2012, has on 08.10.2012, restrained the appellant from marketing the product, only till 15.10.2012.  This being a discretionary order considering the prima facie case, we are not inclined to interfere, particularly, when the learned Single Judge is seized of the stay applications that would be heard on 15.10.2012, which is the next working day after today. 

The points, whether the order of the Assistant Controller is bad in view of Section 25 (3) and (4) of the Patents Act and whether the writ is not maintainable in the face of availability of alternate remedy of appeal  are still to be considered by the learned Single Judge on the next date of hearing and for that reason, we are not inclined to go into that aspect.

7. For the disposal of this appeal, it is suffice for us to mention that the interim order is one of interim arrangement till the next working day after today and was passed on considering the prima facie case, particularly the subsequent event that had taken place after notice of the stay application had been issued. 

8. Hence, we do not find any merit to entertain this appeal.  This appeal is accordingly dismissed.”

An anonymous commentator commented on the last post informing that Cipla sought an adjournment before the Learned Single Judge yesterday in Sugen’s writ petition (which was the originally fixed date for hearing), and accordingly hearing in the petition has been adjourned to December 6, 2012.

Apparently, (which is subject to verification) the Court has ordered that the interim order restraining Cipla from marketing its drug shall continue until December 6, 2012.

Sunitinib Dispute: Delhi High Court’s Order dated October 8, 2012

In my last post, I had blogged on Cipla’s appeal against an order of the Single Judge restraining Cipla from taking any steps to manufacture its drug until October 15, 2012. This order was passed on October 8, 2012 in a Writ Petition W.P.(C) 6361/2012 filed by Sugen Inc (not in a suit, as I incorrectly mentioned in my last post) against the post-grant revocation of its patent by the Controller on September 24, 2012.

I thank the same alert friend for bringing this order to my attention and more importantly, for sharing his thoughts on the issue with me.

The primary ground of challenge appears to be that Sugen Inc was not provided a copy of the recommendations of the Opposition Board in the post-grant opposition proceedings. This, according to Sugen, was a violation of the principles of natural justice, and hence rendered the revocation order a “nullity”.
Readers may collect the order of the IPAB dated August 3, 2012 in Diamcad N.V. and Anr. v. Sarin Technologies  where it was categorically held by the IPAB that the recommendations of the opposition board must be shared with the patentee in order for him to rebut the recommendations, if they adversely affect him.

The Learned Single Judge presiding over the writ petition also took the prima facie view that the contention of Cipla that there is no requirement under the Act to share the recommendation of Opposition Board, was not convincing. Accordingly, Cipla was restrained until October 15, 2012 from taking any steps to market its drug.

There appears to a slight issue with the order of the Single Judge. The post-grant opposition order of the IPAB revoking Sugen’s patent on Sunitinib was not stayed, and yet Cipla was restrained from marketing its drug.

My point is the post-grant order ought to have been stayed if Cipla was sought to be restrained, however if no such stay was granted against the operation of the revocation of the patent, then what is the legal ground for restraining Cipla?

I could be wrong. Comments and corrections are welcome! 

Monday, October 15, 2012

Delhi High Court Reserves Verdict on Cipla Appeal in Sunitinib Matter

On October 13, 2012, Law et al reported that the Delhi High Court has reserved its verdict in an appeal filed by Cipla challenging an injunction granted by the Delhi High Court in a writ petition filed by Sugen Inc. I thank a friend for bringing this news report to my attention.

The appeal was against a decision of the Single Judge restraining Cipla from taking any steps to market its drug.

Readers may recollect that Sugen Inc’s patent over Sunitinib was revoked last month in a post-grant opposition filed by Cipla.

It would be interesting to see how the High Court decides Cipla’s appeal in light of the revocation of the patent. We will keep our readers updated on the case.

Section 124 of the TM Act: Does a Defendant Need the Court’s Permission to Apply for Rectification?

I was recently asked if a defendant/alleged infringer in a suit for trademark infringement needs the Court’s permission under Section 124 of the Trademarks Act, 1999 to file a rectification against the plaintiff’s mark.

In my opinion, the object of Section 124 is to connect filing of a rectification petition to the Court’s obligation to stay the suit proceeding, and not to impose fetters on a defendant’s right to file a rectification petition.

Before I proceed with interpreting Section 124, it needs to be pointed out that under Section 125 of the Act, where there is a trademark infringement suit pending before a court or issues of trademark validity have been raised before a court, and no rectification petition has been filed, it shall be filed only before the IPAB, and not the registrar for Section 124 to be applicable.

If however, there is a pending rectification proceeding before the registrar, that is sufficient to invoke Section 124. This is reflected by Section 124(1)(i).

Now, moving to the import of Section 124, let’s start with the provision itself:

124. Stay of proceedings where the validity of registration of the trade mark is questioned, etc.
(1) Where in any suit for infringement of a trade mark-
(a) the defendant pleads that registration of the plaintiff’s trade mark is invalid ; or

(b) the defendant raises a defence under clause (e) of sub-section (2) of section 30 and the plaintiff pleads the invalidity of registration of the defendant’s trade mark, the court trying the suit (hereinafter referred to as the court), shall,-
(i) if any proceedings for rectification of the register in relation to the plaintiff’s or defendant’s trade mark are pending before the Registrar or the Appellate Board, stay the suit pending the final disposal of such proceedings;
(ii) if no such proceedings are pending and the court is satisfied that the plea regarding the invalidity of the registration of the plaintiffs or defendant’s trade mark is prima facie tenable, raise an issue regarding the same and adjourn the case for a period of three months from the date of the framing of the issue in order to enable the party concerned to apply to the Appellate Board for rectification of the register.

(2) If the party concerned proves to the court that he has made any such application as is referred to in clause (b) (ii) of sub-section (1) within the time specified therein or within such extended time as the court may for sufficient cause allow, the trial of the suit shall stand stayed until the final disposal of the rectification proceedings.

(3) If no such application as aforesaid has been made within the time so specified or within such extended time as the court may allow, the issue as to the validity of the registration of the trade mark concerned shall be deemed to have been abandoned and the court shall proceed with the suit in regard to the other issues in the case.

(4) The final order made in any rectification proceedings referred to in sub-section (1) or sub-section (2) shall be binding upon the parties and the court shall dispose of the suit conformably to such order in so far as it relates to the issue as to the validity of the registration of the trade mark.

(5) The stay of suit for the infringement of a trade mark under this section shall not preclude the court from making any interlocutory order (including any order granting an injunction, directing account to be kept, appointing a receiver or attracting any property), during the period of the stay of the suit.

On a reading of the provision, it bears out that for Section 124 to apply, the defense of invalidity of the registration of the mark must be raised by the defendant. Now comes the interesting part.

In sub-clause (i) of Sub-section (1), the word used is “shall” i.e. if the defense of invalidity is raised, the Court “shall” do the following:

Situation A. If a rectification proceeding is already pending before the Registrar or the IPAB, the Court “shall” stay the suit until the disposal of the rectification proceeding. The point to be noted is, there is no express power under this situation for the Court to consider the prima facie tenability of the rectification proceeding i.e. it does not appear possible for the Court to form an opinion on the tenability of the rectification petition. It can only grant a stay.

Situation B. If no rectification proceeding is filed, it is in this situation that the Court may prima facie assess the tenability of trademark invalidity plea of the defendant. Only if the Court is prima facie satisfied with the plea, it “shall” adjourn the suit for 3 months to allow the defendant to file a rectification petition before the IPAB. This also means that the Court must pass a reasoned order as to why it believes there exists a prima facie case of invalidity of the mark.

Under Situation B, once the defendant proves to the Court that he has indeed moved a rectification petition before the IPAB, the trial of the suit “shall” be stayed until the rectification petition is finally decided.

If despite time extensions allowed by the Court, the defendant fails to file a rectification proceeding, the Court shall treat this as waiver of the invalidity plea. It must be noted that there is still no bar in filing of the rectification proceeding by the defendant. The only consequence is that the Court is under no obligation to stay the suit. In fact, under sub-section (3), the Court shall proceed with the suit.

What is critical is sub-section (5) because it dispels a popular myth that the Court cannot issue an interim injunction before staying the suit under Section 124. The sub-section is abundantly clear on the position that there are no fetters on the grant of equitable/interlocutory reliefs by the Court, which includes an interim injunction besides maintaining accounts.

In other words, it is possible for the Court to issue an interim injunction and stay the trial in the suit until the rectification petition is decided. Theoretically, there could be several instances where the Court may permit the defendant to file a rectification petition before the IPAB, and yet deem it fit to grant an interim injunction to maintain status quo.

I realize this could be inconsistent with the prima facie finding that there is merit in the plea of invalidity of registration. That said, the very nature of equitable reliefs is to cater to factual peculiarities in a particular case. Therefore, filing of an rectification petition before the IPAB need not necessarily translate to denial of interim injunction to the plaintiff.

1. Section 124 does not limit the Defendant’s right to file a rectification petition. It only requires him to file it before the IPAB if such filing is after the institution of the suit.
2. There is no bar on the power of the court to grant any interim reliefs before the suit is stayed.

Comments and Corrections are Welcome!

Saturday, October 13, 2012

Section 31(d) of the Patents Act: Scope of Exception to Anticipation

Section 31(d) of the Patents Act, 1970 states that an invention shall be deemed to have been anticipated by reason only of the description of the invention in a paper read by the true and first inventor before a “learned society” or published with his consent in the “transactions of such a society”, if the application for the patent is made by the true and first inventor or a person deriving title from him not later than twelve months after... the reading or publication of the paper, as the case may be.

The Act does not define the word “learned society” nor does it elaborate on what constitutes a “transaction”. In the absence of these terms, is it possible to bring anything and everything under the sun within the scope of the terms?

The scope of both the terms must be circumscribed in a manner that the scope does not run counter to the legislative intent reflected in the choice of such words. This is because sometimes undefined terms are subjected to unduly broad interpretations which do not find statutory sanction.

How does one infer legislative intent with respect to Section 31(d)? It would help to peruse provisions of the Act which deal with anticipation, namely Sections 29-34.

In particular, Section 34 clearly states that circumstances not covered under Section 29-33 would anticipate a patent specification. In other words, the Act defines what is not anticipatory, and those which do not fall within the penumbras of the windows carved out in Sections 29-33, shall be deemed to anticipate a patent specification. Negative definitions are typically interpreted strictly since they are caveats as to what is not permissible.

Therefore, words such as “learned society” and “transaction” too must be interpreted in a manner which gives effect to the negative definition of anticipation.

The term “learned society” usually alludes to a peer group which has been constituted with the object of promoting knowledge and scholarship in a specific field of human activity. The interpretation of “learned society” depends on the use of the word “transaction”.

This is because, under Section 31(d), for the publication to not anticipate a patent specification, the nature of the publication must be a “transaction”. In other words, the use of the word “transaction” as opposed to a blanket “publication”, serves a specific purpose. Not all publications of a learned society qualify for the exemption under Section 31(d), only publications in the “transactions of a learned society” can rely on the provision to fend off allegations of anticipation.

Section 31(d) appears to have English origins. Section 51(2) is reproduced below:

“An invention claimed . . . shall not be deemed to have been anticipated by reason only of—(d) the description of the invention in a paper read by the true and first inventor before a learned society or published with his consent in the transactions of such a society”

What is relevant is that the English Act too does not provide definitions of “learned society” and “transactions”.  In Ethyl Corporation’s Patent (1963 RPC155) and Ralph M. Parsons Application (1978 FSR 226), the UK Courts had an opportunity to elaborate on the terms wherein it was held thus:

1.  The reason for not defining the term “learned society” is because it would have required the legislature to set a qualitative threshold for the word “learned”.
2.  To avoid unduly broad interpretation of the word “learned”, the term transaction was used in place of “publication”.
3.  On the term transaction, in Ralph M. Parsons Application, it was observed as below:

An essential prerequisite of a publication, if it is to be regarded as “transactions” is that it should be published under the auspices of and finally be the responsibility of the Association—the learned society—whose organ of publication it is.”

4.  These “transactions” are for the private consumption of members of the learned society as a recordal of the society’s proceedings, and which are not published for consumption by non-members in return for a fee or otherwise. In other words, if the publication is accessible to non-members, it would lose the quality of “publication in a transaction”, and could hence anticipate a patent specification.

The problem with the provision is that the way “learned societies” like SAE or IEEE function, the distinction between a “publication in a transaction”, and “publication of a transaction” is nearly moot because articles which are published in “transactions” are available for non-members too.

So how would Courts purposively construe the provision to ensure that the spirit of “limited exceptions to anticipation” is not undermined? Comments are welcome!

Delhi High Court: PIL on Section 107A(b) Dismissed as “Misconceived”

In a 3-page order dated August 22, 2012 which seems to have been uploaded on the Delhi High Court’s website only recently, the High Court has dismissed my PIL as “misconceived” on grounds of "locus standi". I thank an anonymous commentator for bringing the order to my attention.

Of the 5 Paragraphs in the order, Paras 1-3 reproduce excerpts from the PIL in toto. The operative portions of the order read as follows:

“3. We are afraid such a kind of writ petition cannot be entertained as PIL.   The petitioner is trying to advance the cause of those persons who are neither indigent nor illiterate nor vulnerable groups.  They are not persons who cannot approach the Court themselves. The persons concerned with such imports, who may be allegedly affected by the aforesaid provisions, are well off importers and, therefore, if there is any grievance of any such person, he can approach the Court. 

4. Moreover, provisions of a particular Statute or Circular which is statutory in nature cannot be challenged in vacuum. 

5. We are, therefore, of the opinion that this petition as PIL is totally misconceived and is accordingly dismissed.”

In short, according to the Court where it refers to "challenge in vacuum", since there was no immediate “lis”, meaning thereby a person who had been immediately affected by the Customs notifications, a PIL was not warranted. Further, the Court took the view that the ones who are bound to be affected by the Customs notification could approach the Court themselves, and therefore the PIL could not be entertained.

To me, this is surprising because if the Court believed that “locus standi” was an issue, then it ought not to have issued a notice on the very first date (May 23, 2012) if it wasn’t satisfied on locus/maintainability. Instead, the Court issued notice on the first date, and then dismissed the PIL on essentially technical grounds.

Subsequent to the issuance of notice on May 23, 2012, the matter was again listed on July 25, 2012 when no questions on maintainability were raised. Finally the matter was listed for arguments on August 22, 2012. On the said date, the Court primarily heard arguments on the interpretation of Section 107A(b).

After hearing me at length on the provision, at the fag end of the hearing the Court posed a question on “locus standi”. To this, I drew the attention of the Hon’ble Court to specific introductory portions of the PIL which are mandated by the Delhi High Court’s Public Interest Litigation Rules, 2010.

Under these Rules, it is imperative on the part of the Petitioner to make an averment which explains his locus, and that he has the ability to pay costs if they are imposed by the Court.

In the PIL, I had specifically taken the stance that the Customs notification has a bearing on consumers of patented products as well, since ultimately Section 107A(b) entails consumption of the imported patented products by Indian consumers. The only issue to be addressed was who could import and how. Therefore, there is a tangible public interest involved in deciding whether or not the provision envisages a “free for all” importation into India.

I also drew the High Court's attention to judgments of the Supreme Court on locus standi in PILs. Unfortunately, none of these judgments seem to have been addressed in the brief order of the Court. 

That said, the only silver lining in the order is that no adverse observation has been passed with respect to the interpretation of Section 107A(b). To this extent, the law on the provision still remains unsettled and inconclusive.

Friday, October 12, 2012

Rights of an Intermediary under the Information Technology Act: Intermediary Guidelines

In three earlier posts I have discussed the Information Technology (intermediaryguidelines) Rules, 2011 which were notified by the Ministry of Information Technology of the Government of India on April 11, 2011. The Rule that appears to be giving sleepless nights to intermediaries is Rule 3, which has 11 sub-rules. Only those sub-rules of Rule 3 which are relevant to this post are reproduced below:

3. Due diligence to be observed by intermediary — The intermediary shall observe following due diligence while discharging his duties, namely : —
(1)  The intermediary shall publish the rules and regulations, privacy policy and user agreement for access-or usage of the intermediary's computer resource by any person.

(2) Such rules and regulations, terms and conditions or user agreement shall inform the users of computer resource not to host, display, upload, modify, publish, transmit, update or share any information that —
(a) belongs to another person and to which the user does not have any right to;
(b) is grossly harmful, harassing, blasphemous defamatory, obscene, pornographic, paedophilic, libellous, invasive of another's privacy, hateful, or racially, ethnically objectionable, disparaging, relating or encouraging money laundering or gambling, or otherwise unlawful in any manner whatever;
(c)  harm minors in any way;
(d) infringes any patent, trademark, copyright or other proprietary rights;
(e) violates any law for the time being in force;
(f)  deceives or misleads the addressee about the origin of such messages or communicates any information which is grossly offensive or menacing in nature;
(g) impersonate another person;
(h) contains software viruses or any other computer code, files or  programs designed to interrupt, destroy or limit the functionality of any computer resource;
(i)  threatens the unity, integrity, defence, security or sovereignty of India, friendly relations with foreign states, or public order or causes incitement to the commission of any cognisable offence or prevents investigation of any offence or is insulting any other nation.

(3) The intermediary shall not knowingly host or publish any information or shall not initiate the transmission, select the receiver of transmission, and select or  modify the information contained in the transmission as specified in sub-rule (2):
provided that the following actions by an intermediary shall not amount to hosting, publishing, editing or storing of any such information as specified in sub-rule: (2) —
(a)  temporary or transient or intermediate storage of information automatically within the computer resource as an intrinsic feature of such computer resource, involving no exercise of any human editorial control, for onward transmission or communication to another computer resource;
(b) removal of access to any information, data or communication link by  an intermediary after such information, data or communication link comes to the actual knowledge of a person authorised by the intermediary  pursuant to any order or direction as per the provisions of the Act;

(4) The intermediary, on whose computer system the information is stored or hosted or published, upon obtaining knowledge by itself or been brought to actual knowledge by an affected person in writing or through email signed with electronic signature about any such information as mentioned in sub-rule (2) above, shall act within thirty six hours and where applicable, work with user or owner of such information to disable such information that is in contravention of sub-rule (2). Further the intermediary shall preserve such information and associated records for at least ninety days for investigation purposes.

The common assumption appears to be that Sub-rule 4 requires the intermediary to take down material upon receipt of notice from an affected person within 36 hours, without asking any questions or without having the freedom to apply his mind. I don’t think this assumption is reflective of the true position of the law.

This is because sub-rule 4 says the intermediary shall act within 36 hours and “where applicable, work with user or owner of such information to disable such information that is in contravention of sub-rule (2)”. The reference in the provision is to "information that is in contravention of sub-rule(2)", and not information that is claimed by the aggrieved person as contravening sub-rule (2). Therefore, there is no requirement to blindly take down material within 36 hours just because notice has been received from an “affected person”. The only requirement is to "act within 36 hours", which means to do something concrete to redress the grievance of the affected person.

What happens when the "affected person" claims that information sought to be taken down attracts sub-rule 2(d), which refers to infringement of IP rights? Here too, the caveat applies. This means the intermediary has the right to determine if the information sought to be taken down is indeed infringing the IP rights of the affected party.

This is also borne out from an interpretation of Sections 79, 81 and Proviso to Section 81. Following are the said provisions:

Section 79. Exemption from liability of intermediary in certain cases
(1) Notwithstanding anything contained in any law for the time being in force but subject to the provisions of sub-sections (2) and (3), an intermediary shall not be liable for any third party information, data, or communication link made available or hosted by him.
(2) The provisions of sub-section (1) shall apply if the function of the intermediary is limited to providing access to a communication system over which information made available by third parties is transmitted or temporarily stored or hosted; or
(b) the intermediary does not -
(i) initiate the transmission,
(ii) select the receiver of the transmission, and (iii) select or modify the information contained in the transmission;
(c) The intermediary observes due diligence while discharging his duties under this Act and also observes such other guidelines as the Central Government may prescribe in this behalf.
(3) The provisions of sub-section (1) shall not apply if -
(a) the intermediary has conspired or abetted or aided or induced, whether by threats or promise or otherwise in the commission of the unlawful act;
(b) upon receiving actual knowledge, or on being notified by the appropriate Government or its agency that any information, data or communication link residing in or connected to a computer resource, controlled by the intermediary is being used to commit the unlawful act, the intermediary fails to expeditiously remove or disable access to that material or that resource without vitiating the evidence in any manner.
Explanation: For the purposes of this section, the expression "third party information" means any information dealt with by an intermediary in his capacity as an intermediary

Section 81: Act to have overriding effect- The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force.
Provided that nothing contained in this Act shall restrict any person from exercising any right conferred under the Copyright Act, 1957 (14 of 1957) or the Patents Act, 1970 (39 of 1970)

A combined reading of Sections 79, 81 and the Proviso to 81 bears out the following:
A. Section 79 prevails over any provision contained in any law, which includes all other provisions of the Information Technology Act (including Section 81 of the Act).

B. Section 81 says the provisions of the IT Act (including Section 79) shall prevail over any “other law” (which means laws other than the IT Act).

C. The Proviso to Section 81 says that the exception to the over-riding effect of the IT Act under Section 81 are the rights available to any person under the Copyright Act or the Patents Act. This means that neither Section 79 nor Section 81 or any other provision of the IT Act truncates or limits the exercise of the legitimate rights available to “any person” under the Copyright Act or the Patents Act.

D. Critically, the reference to “any person” in the Proviso is not just to a right owner. In fact, it includes all third parties who are entitled to exercise fair use and fair dealing rights under the Copyright Act and Patents Act. This includes intermediaries.

Therefore, an intermediary has the right to decide whether or not the material sought to taken down by an IP right owner amounts to an infringement. If the material does not infringe any right, and has been uploaded in exercise of the intermediary’s legitimate rights under the Copyright or Patents Act, he need not take down the material.

Comments and Corrections are Welcome!

Wednesday, October 10, 2012

IPAB: Decision in Review Petition not Appealable under Section 117A of Patents Act

In a short order dated October 8, 2012, the Intellectual Property Appellate Board (IPAB) has ruled that an order passed by the Controller of Patents in a review petition under Section 77(1)(f) of the Patents Act is not appealable before the IPAB.

The conclusion was arrived at on literal interpretation of Section 117A of the Act since under the said provision only decisions, orders or directions of the Controller issued under the provisions expressly mentioned in Section 117A(2) are appealable before the IPAB.

Support was drawn from Order 47, Rule 1 of the Code of Civil Procedure under which there is no appeal from an order passed in a review petition.

Some might argue that an order passed in a review petition is still an order passed under the original provision which governs the proceeding. Simply put, a review of a decision under Section 15 could still be treated an order under Section 15. Therefore, another appeal from the order in the review petition must lie. The counter to this is that, if an appeal against the original decision is already provided for under the Act, there is no reason to provide for an additional appeal against the review order as well.

Breaking News:Novartis’s Patent Application Rejected by Chennai Patent Office

In a 5-page order dated October 9, 2012, the Chennai Patent Office rejected Novartis AG’s patent application on “An Ethanol-free Pharmaceutical Composition” which was filed in 2006.

The application was rejected after hearing the applicant under Section 14 of the Patents Act since, according to the Patent Office, the applicant’s response to the second examination report did not overcome the objections raised by the Patent Office.

The primary objections were under Section 3(e) and Section 10(5) of the Act. Despite claims being amended by the applicant, the Patent Office was of the view that the amended claims attracted Section 3(e) and did not comply with Section 10(5). The amended claims were as follows:

1. A pharmaceutical foam composition substantially free of ethanol and comprising pimecrolimus in a carrier vehicle comprising a mixture of oily solvents amounting to atleast 40% of the total weight of the composition and consisting of:
i. Hexylene glycol in the range of 1% to 10%
ii. Optionally Oleyl alcohol  in the range of 1% to 20%and
iii. Dimethyllisosorbide  in the range of 35% to 90% and medium  chain triglycerides in the range of 5% to 20% and additionally:
iv. Hydroxypropyl  cellulose  and /or stearyl alcohol in the range of 0.1% to 5%
v.  p_hydroxybenzoic  acid ester with ethyleneglycol  phenylether in the range of 0.1% to 0.5% and
vi.  glyceryl monostearate in the range of 1 to 3% and non-ionic  sugar esters and butane/propane  80/20 as propellant  gas for foaming.

2. A Pharmaceutical foam composition substantially free of ethanol and comprising a mixture of and Pimecrolimus in a carrier vehicle comprising a mixture of oily solvents amounting to  atleast 40% of the total weight of the composition and consisting of:
i.  Hexylene glycol in the range of 2% to20%
ii.  medium chain triglycerides in the range of 50% to 80% and optionally Dimethyl lisosorbide in the range of 0% to20%  and additionally:
iii.  Water in an amount less than 25%
iv.  polyvinylpyrrolidine and stearyl alcohol in the range of 1% to 10%
v.  p_hydro xyberuoic acid ester with ethylenegrycor phenyrether in the rangeof 0.1% to 0.5% and
vi.  glyceryl monostearate in the range of I% to 3% and lecithin; andbutane/propane  80/20  as propellant  gas for foaming.

The Patent Office seems to have had issues with the fact that the components claimed in Claims 1 and 2 are not identical, and even where the components are identical, their range differs. This, according to the Office, ran afoul of the requirement of unity of invention (single inventive concept). Also, the Office took the view that the claims weren’t clear and succinct.

Therefore, according to the Office, the claims did not comply with Section 10(5) of the Act which states that “claims shall relate to a single inventive concept, and shall be clear and succinct and shall be fairly based on the matter disclosed in the specification.”

Also, the Patent Office observed that no experimental data had been provided by the applicant to establish that the claimed compositions exhibited synergistic effect over and above the prior art.

There is also a cursory observation that the patent application claims subject-matter which is barred under Section 3(e) i.e. “a substance obtained by mere admixture resulting only in the aggregation of the properties of the components therof or a process for producing such substance”.

The problem with the order is that it is tersely-worded and does not give a reader a clear picture as to what according to the Patent Office is the specific relationship between the components claimed in Claim 1/their range, and the inventive step sought to be protected by the applicant.

Had this been clarified, one would have been in a better position to understand how different is the inventive step in Claim 2 due to different ranges and components being claimed.

In other words, how do the components and their ranges in Claims 1 and 2 affect the preamble of the claim, namely “A pharmaceutical foam composition substantially free of ethanol and comprising pimecrolimus in a carrier vehicle comprising a mixture of oily solvents amounting to atleast 40% of the total weight of the composition..”

Also, there is no elaboration on the finding on Section 3(e). This in itself could render the decision reasonably appealable before the IPAB under Section 117A.

It would really help if decisions of the Patent Office reflect application of mind by the Office. At least this way, the ground of “absence of reasoning” could be done away with in an appeal.  

Monday, October 8, 2012

Breaking News: Vijay Mallya Settles Dispute over the whisky brand "Officers Choice" has reported today that Vijay Mallya-run United Spirits has settled its long-running trademark feud pending before the Delhi and Calcutta High Courts with its competitor Allied Blenders and Distillers (ABD) over the popular whisky brand "Officers Choice", which is being used by ABD currently . 

Apparently, United Spirits has been offered INR 8 Crores by ABD for relinquishing its claim over the brand, which is reportedly the largest selling whisky brand in India as on date. 

TVS-Bajaj Patent Dispute: When Will the Joint Trial Begin?

Following is a timeline of the TVS-Bajaj twin-spark plug patent dispute which is pending before the Madras High Court:

  1. TVS filed a suit, C.S.No.979/2007, before the Madras High Court against Bajaj Auto Limited on grounds that Bajaj’s threats of infringement of its patent IN195904 by TVS were groundless. TVS also sought a declaratory judgment that its 125CC bike “Flame” did not infringe Bajaj’s patent. An interim relief was sought to restrain Bajaj from interfering with the manufacture and sale of “Flame”.
  2. Bajaj filed a suit, C.S.No.1111/2007, before the Madras High Court against TVS for infringement of its patent IN195904. Among other reliefs, an interim injunction was also sought.
  3. 19.12.2007- Single Judge of Madras High Court restrained TVS from booking “any further orders” with the liberty to execute orders which had already been received.
  4. 20.12.2007- TVS appealed and a Division Bench (DB) of Madras High Court set aside the Single Judge’s order
  5. 18.01.2008- Bajaj filed Special Leave Petition (SLP) before the Supreme Court. SC set aside the Division Bench’s order and permitted sale of TVS’s bikes booked until 18.01.2008. However, according to the SC, no further bookings were to be received by TVS until 28.01.2008. Also, SC directed the Single Judge of Madras HC to take up hearing of interim applications on 29.01.2008.
  6. 29.01.2008- Madras HC Single Judge commenced hearing. TVS undertook to not receive any further booking in respect of “Flame”. Matter gets listed for hearing on 30.01.2008
  7. Hearing commenced on 30.01.2008.
  8. February 16, 2008- Madras HC Single Judge issued an interim injunction against TVS in favour of Bajaj
  9. TVS appealed to a Division Bench of the High Court and on May 18, 2009, DB vacated the interim injunction and ordered expedited trial in the matter
  10. Against the order of the DB, Bajaj filed an SLP before the Supreme Court. On September 16, 2009, SC chose not to interfere with the Madras DB’s order and directed expedited trial. Also, the Single Judge of Madras HC was directed to dispose off the suit by November 30, 2009.
  11. November 25, 2009- Issues were framed by the Single Judge of Mad HC
  12. March 10, 2010- Single Judge of Madras HC ordered Bajaj to prove its case first.
  13. October 4, 2010- Bajaj again appealed to the DB against the order dated March 10, 2010. In the appeal, the DB of Madras HC ordered TVS to prove its case first since it was the first party to file C.S.No.979 of 2007. In other words, since it was the plaintiff in the suit for groundless threats of infringement (which was filed first), the onus was on TVS to prove non-infringement of Bajaj’s patent. Therefore, TVS had to first lead evidence of non-infringement.
  14. September 21, 2011- TVS’s application under Order 18, Rule 3 of the Code of Civil Procedure and application for joint trial were allowed by the Single Judge of the Madras HC.
According to the Supreme Court’s order of September 16, 2009, the suits were to be disposed off by November 30, 2009. After the last order of September 21, 2011, I am not sure if any more orders were passed in the matter. The Madras HC’s official website too does not seem to contain a list of orders passed in the matter after September 2011.

One hopes the joint trial in this matter commences soon because it would be interesting to see an Indian Court apply the law in a non-pharma patent trial. 

Sunday, October 7, 2012

Enercon India – Alloys Wobben Saga: Bombay High Court Directs Parties to Arbitrate

I had earlier blogged on the judgment of a Division bench of the Delhi High Court in Dr.Alloys Wobben v. Yogesh Mehra & Ors. delivered on January 20, 2012, in which the the DB had held that both a counter-claim and a revocation petition could be explored simultaneously against the same patent.

In a related contractual dispute between the parties which appears to be the root of all contentions between the parties, the Bombay High Court delivered its decision (available here) on October 5, 2012 in Writ Petitions filed by Enercon India against orders passed by the District Judge of Daman. According to the decision, both warring factions have been directed to resolve their disputes through arbitration provided for in the Intellectual Property License Agreement (IPLA) previously entered into between the parties.

The detailed facts leading to the writ petitions are as follows:

1. Petitioners/Plaintiffs: Enercon India, Yogesh Mehra and Ajay Mehra (Mehra brothers are directors of Enercon India)
2. Respondents/Defendants: Enercon GmBh (Dr.Alloys Wobben is its Director) and Wobben Properties Gmbh
3. Shareholding Pattern in Enercon India (Joint Venture Company): Enercon GmBh- 56%, Mehra Brothers- 44%
4. Owner of Patents on Windmill technology- Wobben Properties Gmbh, Licensor- Enercon GmBh, Licensee- Enercon India
5. A Technical Know-How Agreement was entered into in 1994 between Enercon GmBh and Enercon India under which Enercon Gmbh agreed to transfer to Enercon India the right and the technology to use the technical know-how for the manufacture of E-26 Wind Turbine Generators 
6. A Supplementary Technical Know-How Agreement entered into in 2000 amended the 1994 agreement and granted a licence to Enercon India to manufacture the E-30 and E-40 Wind Turbine Generators.
7. The Agreement expired in 2004, however Enercon GmBh continued to supply Wind Turbine Generators and components to Enercon India.
8. In 2006, parties entered into a comprehensive arrangement by the name “Agreed Principles” which governed the use and supply of windmill technology. Under the Agreed Principles, parties further entered into an Intellectual Property License Agreement ("IPLA") on September 29, 2006, which was the subject matter of the dispute between the parties in the Writ Petitions.

According to Enercon India:
A. “the Agreed Principles are the binding principles agreed between the parties, and which records an agreement that all definitive agreements between the parties that were to be prepared and finally executed would be on the basis of the binding principles agreed therein. One of the agreements contemplated by the said Agreed Principles was the IPLA

B. “the IPLA signed in September 2006 was merely a draft of the oral terms and not a concluded contract between the parties. It was their case that the said document was an unincorporated and inchoate document and was not a concluded contract

C. This, according to Enercon India, was supported by a communication received by it from a representative of Enercon Gmbh dated October 4, 2006 in which it was conveyed by the representative that she “would try her best to prepare/adapt the agreements according to the Agreed Principles”.

D. On October 18, 2006, the same representative informed Enercon India that the IPLA signed in September 2006 was the final document.

Subsequent to this, parties exchanged notices arguing on whether or not the IPLA was final and binding. Enercon GmBh stopped supplying generators and components to Enercon India and litigation ensued, which is captured in brief below:

Litigation between the Parties
i. Enercon India filed a suit before the Bombay HC seeking an interim relief to the effect that supply of generators and components be resumed. Enercon GmBh did not comply with the order, resulting in the filing of a contempt petition against it by Enercon India.
ii. In response, Enercon GmBh moved the Company Law Board, Delhi for removal of Mehra brothers as directors of Enercon India. The Mehra brothers in turn filed a company petition against Enercon BmBh for oppression and mismanagement.
iii. Besides, Enercon GmBh also secured an ex parte injunction from the Hamburg District Court against Enercon India restraining the latter from supplying generators under the trademarks of Enercon GmBh. The injunction was subsequently set aside by the Hamburg Court on grounds of lack of evidence against Enercon India.

Finally in March 2008, Enercon GmBh evinced interest in settling all outstanding disputes with Enercon India, including the question of the IPLA, and invoked the arbitration clause provided for in the IPLA. Enercon India responded stating that since the IPLA was not a concluded contract, there was no valid arbitration agreement in place. Also, according to Enercon India, by its litigious conduct Enercon GmBh had waived the arbitration agreement.

Enercon GmBh then filed for a declaratory judgment in a UK Court against Enercon India, inter alia seeking an anti-suit injunction against Enercon India to restrain it from continuing with the suit proceedings before the Bombay High Court.

On its part, Enercon India filed a suit before Senior Division Judge, Daman seeking – “a declaration that the IPLA was not a concluded contract and correspondingly that there was no Arbitration Agreement between the parties; for a declaration that the initiation of proceedings before the English Court by the Respondents was void and illegal; and for a permanent injunction restraining the Respondents from continuing with the proceedings before the English Court”.

The Senior Division Judge, Daman passed an ex parte order restraining Enercon GmBh from proceeding with the suit before the UK Court. Subsequently, Enercon GmBh appeared before the Daman Judge and moved an application under Section 45 of the Arbitration Act contending that the suit must be referred to arbitration under the IPLA. The Senior Division Judge dismissed Enercon GmBh’s application and confirmed the anti-suit injunction.

Enercon GmBh appealed to the District Judge, Daman who set aside the decision of the Senior Division Judge on the grounds that since the Mehra Brothers had signed in the IPLA in September 2006, it was a concluded contract, and hence the arbitration clause was valid.

Against this decision of the District Judge, Enercon India and Mehra brothers preferred writ petitions before the Bombay High Court.

Writ Petitions before the Bombay High Court
In the Writ Petitions filed by Enercon India and the Mehra Brothers (Petitioners), the Bombay High Court concluded that the IPLA was a concluded contract, and that the arbitration agreement too was valid, based on the following reasons:

A. 19.The inquiry contemplated under Section 45 is therefore of a prima facie nature of the existence of an Arbitration Agreement. If the Court comes to a prima facie conclusion that there is an Arbitration Agreement and the same is legal and valid, the matter must be referred to the Arbitral Tribunal for further consideration which can thereafter conclusively decide either way. If the Court comes to the prima facie conclusion that there is either no Arbitration Agreement or that the same is not valid in law, the Court must then proceed to determine the same finally and conclusively.

B. 22.... The aforesaid Judgments of the Apex Court as well as the United States Supreme Court, make it clear that the Arbitration Agreement would survive even in case of invalidity of the main agreement or the underlying contract. It is only in cases where the underlying contract is vitiated by fraud, coercion or misrepresentation that the same would impact the Arbitration Agreement. 23 The principles of severability and separability of the Arbitration Agreement is common both under the English Arbitration Act, 1996 and the Indian Arbitration Act 1996...

C. 24....The Learned Senior Counsel for the Petitioners laid much store on the correspondence post 29-9-2006 i.e. the date when the IPLA was signed, to contend that the IPLA was not a concluded contract. However, the correspondence prior thereto between the parties indicates otherwise. If the said correspondence is seen, to which my attention is drawn by the Learned Senior Counsel appearing for the Respondents, the same discloses that it was on 27-6-2006 i.e. a good three months prior to its execution,that the draft IPLA was sent to the Petitioners. The said IPLA had already undergone changes on the basis of the suggestions of both the parties and the final document was kept ready on 29-9-2006 as the Petitioner No.2 had shown his inability to come to Aurich on 17-9-2006 when it was to be executed.

D. 24.... The most important letter if it can be said so, is the letter dated 30-9-2006 which is addressed by the Petitioner No.2 Yogesh Mehra in his own handwriting stating therein that he has executed not one but more than one agreement on 29-9-2006. Pertinently in paragraph 2 of the said letter, the Petitioner No.2 has in fact referred to the patent of E-82 being the subject matter of the IPLA and not the Agreed Principles

E. 29. The defining aspect is the intention of the parties to go for arbitration which intention is clearly manifest in the IPLA.

F. 37 This Court has taken a prima facie view that there is in existence an Arbitration Agreement and therefore the parties can be referred to arbitration. In so far as instant Petition i.e. Writ Petition No.7636 of 2009 is concerned, the question is whether the Petitioners are entitled to an anti suit injunction, and whether the English Courts have jurisdiction.

G. 38 The adjudication of the said aspect therefore revolves around the interpretation of clause 18.3 of the IPLA. For the sake of convenience, the said clause 18.3 is revisited herein under for the purposes of the present Petition. "Clause 18.3---- All proceedings in such arbitration shall be conducted in English. The venue of the arbitration proceedings shall be London. The arbitrators may (but shall not be obliged to) award costs and reasonable expenses (including reasonable fees of counsel) to the Party(ies) that substantially prevail on merit. The provisions of the Indian Arbitration and Conciliation Act, 1996 shall apply"

On the basis of this clause, the Bombay High Court finally concluded as follows in Para 55:

55. On an interpretation of clause 18.3 of the IPLA this Court has reached a conclusion that the curial law or Lex Arbitri would be the Indian Arbitration Act. Though the Indian Arbitration Act would apply, however, in view of the fact that the parties have chosen London as the venue for the arbitration meetings, the English Courts would have concurrent jurisdiction and therefore the jurisdiction of the English Courts can also be invoked by the parties for taking such measures as are required in support of arbitration. The judgment and order of the Lower Appellate Court on the aspect of anti suit injunction is, therefore, sustained but on a different ground which is mentioned in the body of this Judgment.