Category Archives: India Patent Filing

IPAB’s recent order provides clarity on divisional applications in India

Trademark infrignement

What is a divisional application?

A divisional patent application is derived from a previously filed patent application which relates to more than one invention or inventive concept. Such applications fall under purview of section 16(1) of the Indian Patents Act, 1970.

Ambiguities before IPAB:

Over the years, IPO and patent lawyers maintained the ideology that divisional applications could be filed at any time before the grant of the patent, if desired by applicant. This provision was adopted to certain cases when applicants were not able to comply with statutory time period for placing the application for grant. In scenarios like these, in order to claim the priority date, applicants used to file a divisional application, with similar claims as those present in the parent application, just before the due date expired. The ambiguity lied in the matter that whether such applications were supposed to be allowed or rejected. These matters soon reached IPAB for clarification and laying out right approach when filing a division application.

The provision of divisional applications was also utilised in order to claim subject matter that were rejected for reasons corresponding to not being patentable subject matter under Section 3 of the Patents Act. As an example, applicants whose prior applications based on chemical compositions that were denied for being not patentable, started filing divisional application essentially claiming the same invention as the parent application. This interpretation led to allowing many divisional applications whose parent application was rejected. The IPAB was required to clarify the position of such application with legal perspective.

ESCO Corporation v. Controller of Patents and Designs, New Delhi

In a recent order (OA/66/2020/PT/DEL) by IPAB dated October 27, 2020, the IPAB allowed the appeal filed by ESCO Corporation (Appellant). The Appellant bears a patent application numbered 8094/ DELNP/ 2008 which got rejected by Controller of Patents and Designs, New Delhi (Respondent). The Respondent refused the grant of patent on the ground that the application failed to meet the requirements of Section 16(1) of the Patents Act, 1970. In this case of applicant, the parent and divisional applications were examined by different Controllers. 

Brief facts of the case:

  • The Applicant had filed the first application no. 4702/DELNP/2005 (hereinafter referred as parent application) with 56 claims, out of which claims 1-46 were related to “Wear assembly”. The claims 41-52 were related to “Wear member” and claims 52-56 were related to “a method of attaching a wear member to a support branch”.
  • These claims underwent further amendments leading to retainment of only 34 claims. The claims 1-14 were related to “A wear assembly” and claims 15-19 were related to “a method” and claims 20-28 were related to “a lock” and claims 29-31 were related to “a wedge” and rest 32-34 were related to “a wear member”.
  • An objection was raised in the first examination report of the parent application that claims 20-34 were inconsistent with claim 1 and plurality of independent claims existed. In response, the Applicant filed a divisional application (8094/DELNP/2008) corresponding to the current application with claims 20-34. In the first examination report issued for the current application -8094/DELNP/2008, an objection was raised under section 16(3) of the Patent Act by Controller for the claims 13-15 related to “A wear member” which corresponded with the claims 32-34 of the amended claim set of the claims 1-34 of the parent application. In response, the Applicant amended the claim set such that only claims 13-15 were retained as claims 1-3 in the current application.
  • The Controller objected on grounds that the claims 1-3 did not relate to an invention distinct from claims in the parent application, since the wear member was already a feature of the wear assembly claimed in the parent application. Hence, the divisional application was illicit.  The application no. 8094/DELNP/2008 was refused due to non-compliance with requirements of Section 16(1) of the Act.

Reasonings by the IPAB:

  • A patent application is supposed to be divided if the claims pertaining to the parent application include “more than one invention”. The IPAB reached this conclusion by accounting legal provisions of Section 7, Section 10(5) and Section 16 of the Act, MPOPP for divisional application and recent orders- OA/6/2010/PT/KOL (L.G. Electronics); OA/47/2020/PT/DEL (Proctor & Gamble); and OA/21/2011/PT/DEL (National Institute of Immunology).
  • The term “one invention” corresponds to the claims of the complete specification related to either “single invention” or could be “a group of inventions linked so as to form a single inventive concept”. This conclusion of the IPAB was based particularly on legal provisions of Section 7 and Section 10(5) of the Act. The order recites that “no two invention(s) can be allowed in a single patent application unless it conforms to a single inventive concept. Hence, either way, it is a single inventive concept which is allowable in one application, as per the statutory provisions”.
  • In the case of 4702/DELNP/2005, the IPAB acknowledged that all the claims 1-34 of the parent application could have been allowed with the suitable amendments as they relate to a single inventive concept. However, the Applicant filed a divisional application based upon the objection by the Controller in the first examination report of the parent application. Further, the IPAB made an observation that the filing of the instant divisional application for the parent application does not lead to double patenting issues and hence allowed the divisional application.

Listings by IPAB:

The IPAB relied on legal provisions of Indian Patent law, the Manual of Patent Office Practice and Procedure, the PCT and the previous orders issued to list down the following key points to be looked into while addressing issues concerning divisional applications.

Points to be considered before filing divisional application:

  • If applicants desire on their own accord (Suo-moto), they can file a divisional application.
  • The applicant may file a divisional application in order to find solution to an objection raised on the ground of plurality of invention in the parent application. The existence of a plurality of invention in the parent application is the crucial and mandatory for filing a divisional application.
  • The divisional application should not be filed with the same set of claims as the parent application.
  • Division of the parent application should be exercised on the ground of ‘plurality of invention’ as contemplated under section 16 of the Act.
  • The application shall exist and no divisions can be made from applications that are either “deemed to be abandoned”, ‘withdrawn” or “refused”. In addition, after the filing of the divisional application, the divisional application will continue and the legal status of the parent application will not affect the divisional application.
  • The divisional application can be filed any time until the grant of patent.
  • The complete specification of the divisional application should not include any subject matter not disclosed in the complete specification of the parent application. Any additional claims which never formed part of the originally filed claims and complete specification shall not be allowed in a divisional application.

Points to remember while examining the divisionals:

  • The fact that there are different embodiments in the specification, claimed as an independent set of claims, does not mandate the application to fall under lacking “unity of invention”. The applicant must be given an opportunity to amend the claims to overcome such objections. As a matter of fact, an outright objection on the plurality of inventions should not be given, just because there are different embodiments in the specification.
  • In scenarios where there is plurality of inventions in the claim set, while examining such applications, the distinct inventions need to be identified in the First examination report (FER) in order to reduce the needless legal complications.
  • If two or more divisional applications are filed based on a first mentioned application or parent application, then the examination of subsequent divisional application(s) shall be done vis-a-vis the first-mentioned application and other divisional application(s) examined earlier, in order to avoid double patenting.
  • When an objection on the unity of invention is raised in the examination of the first-mentioned application, the divisional application should be allowed if it fulfils all statutory requirements. The applicant should be given an opportunity to make amendments accordingly.

Clarifications put forth by IPAB:

  • The applicant can file a divisional application only if the claims of the invention pertaining to the parent application do not relate to a single invention. The IPAB also shed light on the fact that, even though an applicant possesses the right to file a divisional application on their accord, this right is debatable and subject to the Controller’s discretion whether to allow or discard such application.
  • If claims in the parent application are overlapping with those in the divisional application, the Controller may ask the Applicant to amendment the claims to remove such overlap. In other words, the divisional application should not include any claim that has been present in the parent application.
  • The subject matter disclosed in the divisional application should not include any matter that has not been disclosed in the complete specification of the parent application. In order to become eligible as a divisional application under section 16, it is crucial that the parent application, from which the divisional application is filed, should disclose more than one invention.

The instant order (OA/66/2020/PT/DEL) by the IPAB aims at providing clarity regarding filing and prosecution of divisional applications. The present order has taken into account the provisions in the statute, the legal bindings of PCT, the jurisprudence and provides a set of legal guiding principles that aim to provide consistency and uniformity in evaluation and examination of divisional applications.

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Reworking the Statement of Working: The Patent (Amendment) Rules, 2020

Statement of working of patent

On 19 October 2020, the Government of India notified the Patent (Amendment) Rules, 2020, which, among other things, brought the first modern change to the Statement of Working. Patentees and licensees had for a long time been faced with answering the myriad ambiguous questions contained in the Form 27, and so, quite possibly owing to a direction from the Delhi High Court in Shamnad Basheer v. Union of India and Ors., the Government of India revamped the requirements under Form 27. The changes have been captured below:

Requirements under Form 27 prior to the Patents (Amendment) Rules, 2020

Requirements under Form 27 post the Patents (Amendment) Rules, 2020

PROS

A patentee would have to file a separate Statement of Working for each patent he holds.

A patentee can file a single Statement of Working for all related patents, i.e., all patents involved in a single product, subject to the fulfillment of certain criteria. *

In case of joint applicants, each patent holder would have to file a Statement of Working.

Joint patent holders can now file a single Statement of Working.

Quantum as well as value of the patented product in exhibiting proof of the working of the patent had to be submitted.

The Statement of Working now only requires the approximate value accrued in India. #

Patentees and licensees had to specify as to whether the “public requirement” of the patent had been met, based on ambiguous terms like ‘partly or adequately’, ‘fullest extent’, and ‘reasonable price’.

The need for specifying the meeting of public requirement has been done away with.

The Statement of Working had to be filed for every calendar year, and within 3 months from the end of the calendar year, i.e., by March 31st.

The Statement of Working has to be filed for each financial year, and within 6 months from the end of the financial year, i.e., by September 30th. ^

CONS

Patentees and licensees could file a joint Statement of Working.

Every patentee and every licensee (exclusive or otherwise) will have to file a separate Statement of Working. However, patentees need not specify the licenses given out in a particular year.

* – In order to qualify as related patents, the situation must be such that the (i) approximate revenue accrued from a particular patented invention cannot be derived separately from the approximate revenue accrued from the other related patents, and (ii) all patents have been granted to the same patentee(s).

# – However, patentees and licensees must still provide the differentiation in working through manufacturing in India, and importation into India. However, they no longer need to specify the country-wise details of importation.

^ – The new Rules clarify that the Statement of Working must be filed for the financial year immediately following the financial year in which the patent was granted. Ergo, if the patent was granted on 1st December 2020, the patentee would have to file the Statement of Working only for the next financial year onwards, i.e., for 2021-2022, and therefore the last date to submit the Statement of Working would be September 30, 2022.

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The Draft Patents (Amendment) Rules, 2021 recognises certain “Eligible” Educational Institutions

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On February 09, 2021, the Ministry of Commerce and Industry notified the Draft Patents (Amendment) Rules, 2021 to further amend the Patents Rules, 2003, for public opinion. 

The following amendments have been proposed:

Definition of “eligible educational institutions” added:

Rule 2 (ca) provides that “eligible educational institution' means an institution established by a Central, Provincial or State Act, which is owned or controlled by the Government, and is wholly or substantially financed by the Government.”

Form 28 filing required:

Second Proviso to Rule 7(1) is substituted by which, all “eligible educational institutions” must pay the requisite fee along with a Form 28 to claim the status.

The applicant is required to provide documentary evidence that the Applicant is established by a Central, Provincial or State Act, which is owned or controlled by the Government, and is wholly or substantially financed by the Government

Form 28 in the Second schedule has been updated to provide for the same:

Picture1

Eligible for expedited examination:

Rule 24C is amended to include “eligible educational institution”. An applicant claiming such status may opt for expedited examination process.

Form 18A of the Second schedule has been amended to include “eligible educational institutions:

Picture2

Fee concession:

First Schedule, which specifies the filing for patent, has been substituted. Now, eligible educational institutions shall pay the same fees as natural persons, start-ups and small entities.

Further, Rule 7 (3), which specifies the processing of application, has been substituted, namely: 

In case an application processed by a natural person, startup, small entity or eligible educational institution is fully or partly transferred to a person other than a natural person, startup, small entity or eligible educational institution, the difference, if any, in the scale of fees between the fees charged from the natural person, startup, small entity or eligible educational institution and the fees chargeable from the person other than a natural person, startup, small entity or eligible educational institution, shall be paid by the new applicant along with the request for transfer.”

Note: The draft amendment rules are open to objections/suggestions for a period of 30 days from their date of notification. Such Objections/ suggestions may be addressed to the Secretary, Department for Promotion of Industry and Internal Trade, Ministry of Commerce and Industry, Government of India, Udyog Bhawan, New Delhi- 110011 or by e-mail at sachin.d@gov.in.

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Permissible amendments under section 57 and 59 of the Indian Patent Act

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BACKGROUND OF THE CASE

A provisional application entitled “A Process for Manufacturing Isostatic Punch and the Punch Manufactured therefrom” (application number: 1202/MUM/2005) was filed on 27th September 2005, by Prism cement Ltd. (Appellant) for which a complete specification was filed on 27 September 2006. A first examination report (FER) was issued on November 05, 2012 by the Controller of Patents (herein Respondent in this case). The appellant filed a response to the FER on 31st October 2013, with amended set of claims reducing the claim count to 10 from 17. A comparison of the as filed claims and claims amended in the FER response is presented below:

 

As filed claims (independent claim)

Claims amended in the FER response

Claim 1

Claim 1 (amended)

1. A method of manufacturing an isostatic punch comprising of

preparing an inbuilt rubber grid tight-fitting in cavity / cavities of a

metal base having opening/s to fill in a viscous liquid at the base of

the said inbuilt rubber grid and further rubberizing it with layer/s

of rubber.

  1. An improved method of manufacturing an isostatic punch having an inbuilt rubber grid tight-fitted in cavities on a metal base having openings to fill in a viscous liquid at the base of the said inbuilt rubber grid and further rubberizing it with layer/s of rubber, comprising the following steps:

a. Making a network of two or more interconnected cavities, channels and openings with valves on the metal base;

b. Pressing rubber tightly on the said cavity bearing surface of metal base;

c. Pressing a rubber  layer onto the said cavity bearing surface of metal base having inbuilt rubber grid.

 

Claim 11

Claim 4 (after amendment)

11. An isostatic punch, comprising of an inbuilt floating rubber grid tight-fitting in one or more cavities of a metal base having opening/s to fill in viscous liquid at the base of the said inbuilt rubber grid and further rubberized with layer/s of rubber.

4. An isostatic punch, comprising of an inbuilt floating rubber grid tight-fitting in one or more cavities of a metal base having opening/s to fill in viscous liquid at the base of the said inbuilt rubber grid and rubberized with layer/s of rubber.

The Respondent on 10th February 2015, issued a hearing notice appointing a hearing to be held on 23rd February, 2015. A post hearing written submission was filed on 02 March 2015, with amended set of claims reducing the claims count to 6 from 10 and comprising a single independent claim.  The amended independent claim 1 is reproduced below:

1. A method of manufacturing an isostatic punch having cavities of required dimensions connected together with channels on the surface of a base metal plate; oil ports at the bottom of the said base metal plate opening into some of the aforesaid cavities; rubber grid of nearly equal

  dimensions as of the cavities and channels placed therein and rubber layer on top of the said base metal plate characterized in that the said method inter alia comprises of the following steps:

a) Making two or more cavities all connected by open channels, on the surface of a base metal plate;      

b) Providing oil ports at the bottom of the said base metal plate opening into at least two of the aforesaid cavities and non-return valves, one each at the mouth of the -said oil ports;

c) Applying a mould release solution over the said base metal plate;

d) Rubberizing a first rubber sheet onto the said base metal plate and the said cavities therein;

e) Scraping the excess rubber on the said base metal plate after step (d) above;

f) Shot blasting the base metal plate with the rubber in the cavities, made in step (e) above; and

g) Rubberizing a second rubber sheet on the base metal plate.

 

Further, a telephonic discussion was also held 07 April 2015 by the respondent for discussion and an impugned order was passed on 18 September 2015 rejecting the grant of the appellant’s patent application. One of the objections raised in the hearing notice is the inclusion of the terms “open channel” and “position of non-return valve” in the claims. Grounds for rejection from the order is produced below:

  1. New set of claims were filed; which were not submitted in-line with the original filed claims by strictly adhering to section 57/59 of The Patent Act. Claims were filed with form-13. New features added which is added to overcome the cited documents like open channel whereas channel was given in specification only but citation for punch having made from channel to overcome the objection open channel was added whereas open channel was not support in specification. Secondly position of nonreturn valve is defined in step (b) one each at the mouth of the said oil parts. Where as in specification shows non-return valve are placed at the base of the cavity which at their base the oil ports. Position was added which has not supported by specification. The amendments made by applicant are not allowed in view of Section 57 and 59

 

  1. Additional two more prior art references D5 and D6 were cited in the hearing notice issued and the Respected Controller has alleged that the cited references lack inventive step in view of D1 to D6.

An appeal was filed (16th December, 2015) to the IPAB against the order dated 18th September 2015, passed by the Respondent rejecting the grant of the Appellant’s patent application numbered 1202/MUM/2005.

IPAB DECISION:

The IPAB reviewed the specification together with the drawings as mentioned in the arguments presented by the learned counsel of the appellant.

 

Relevant excerpt from the IPAB order:

We have seen that paragraph 1 on page 7 of the Complete Specification mentions about channel as ““Referring to the aforesaid figures 1 to 4 a base metal plate (1) has cavities (2)-(2) connected by channels (3)-(3) together forming the cavity network….”. Further once we refer to the drawings and particularly Fig1-4 we see that channels referred to in the description are ‘open’ in nature. Though the word “open” is not found explicitly mentioned in the description but once the description and the drawings are read together, it is clear that the “channel (3)-(3)” as explicitly mentioned in the description, is in fact “open channel”. Therefore, if the appellant has amended “channel” to “open channel”, the amendment is well supported by the description when read with the drawings and if the adjective ‘open’ is added to “channel” in the claims, the scope of the word “channel” is narrowed. Further, the view of the respondent that appellant added the word “open” to escape the inventive step objection; we will deal when we analyze the inventive step. For now it is clear that the appellant while supplementing the word “channel” with the word “open” and amending the claims with the phrase “open channel”, have support in the complete specification when the description is read with the help of drawings.

After reviewing the description and the drawings, we are convinced that the position of the non- return valves remains unaltered. It’s basically when defining the position with reference to oil ports (4)-(4) the position of the non- return valves is at “the mouth of the said oil ports” and while defining with respect to cavity, it is at “the base of the cavity”. The oil ports are at the base of cavities and on the mouth of the oil ports, the non return valves are placed. Either way, it is explained the position of the valve remains the same. Therefore, these amendments also find its support in the description when read with the drawings and well within the scope of original disclosure.

The IPAB held that both the amendments are well within the scope of the original specification and are not a part of newly introduced matter. The amendments are made by way of explanation and do not attract the provision of section 57 and 59 of the patent act.

Conclusion:

At the stage of drafting the specification, one may not incorporate or miss out minute details that may be evident from drawings but may not be that essential at that stage. However, during the prosecution, one may desire to amend the claims (based on the cited documents) considering the feature that is disclosed in the drawings, but not explicitly disclosed in the specification. There have been instances, where such amendments are considered as newly added subject matter or matter not supported in the originally filed specification and objections are raised under section 57 and 59 of the patent act. The present order provides an understanding to the amendment that are allowable under section 57 and 59 of the patent act. It also throws light to the importance of analysing the claimed invention together with the description and the drawings and the importance of the drawings submitted along with the specification.

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What is PPH (Patent Prosecution Highway)? …. Why PPH? ….All that you need to know

Patent Offices across the globe have come up with various bilateral agreements to promote work-sharing and enable accelerated prosecution of patent applications at the office of second filing (OSF).

Pic: Global PPH status as of November 12, 2020(Courtesy: WIPO)

PPH

Patent Prosecution Highway (PPH) is one such bilateral agreement signed between the participating countries to reduce the search/examination burden and enhance the quality of examination in major patent offices in the world. PPH was first developed between the USPTO and JPO and the corresponding Pilot program commenced on July 03, 2006. The PPH enables reduction in patent application redundancy in partner patent offices, accelerates the process to provide expedited patent prosecution with better allowance rate and significant cost reduction mechanism.

 

PPH can be opted for applications that satisfy the following criteria:

  • The patent application should not have been filed that recently that the prosecution in the Office of First Filing (OFF) has not reached a successful conclusion; and
  • The patent application should not have been filed that long ago that the examination as already begun at the OSF.

Hence, Applicant wishing to avail the benefits of PPH must keep abreast the prosecution status of the related patent application in OFF and the OSF countries such that once the OFF issues allowance, the Applicant can request for PPH before the patent application is allotted for examination in the desired OSF.

 

Sl No.

PROs

CONs

1.

Time taken for examination shall be lesser.

The claims cleared by OFF are set as the limitation for the claims applied in OSF

2.

Advantageous for cross-licensing negotiations

Negative comments by the examiner in an OSF may be used during litigation against patent granted in OFF.

3.

Reduces overall costs

Compromises the OSF examination quality by reducing the number of prior arts that could have been examined.

 Some Effective Strategies to make the most of PPH may include:

  • Identify eligible pairs of OFF and OSF
  • Identify the potential future OFF and OSF patent applications before the program starts.
  • Identify patent applications for PPH that are divisional applications in the OFF. If the OFF of the divisional patent application is USPTO then the first set of claims can be applied via PPH route in the OSF and the other set of claims can be filed as a continuation patent application for conventional prosecution at a later stage. This enables preservation of broader claims.

The Patent Prosecution Highway (PPH) pilot program between Indian Patent Office (IPO) and Japan Patent Office (JPO) begins on December 07, 2020. The IPO has issued the guidelines for submitting the request for entering the IPO under the PPH program that is elaborated HERE.

The Applicant may note the following points while considering the PPH to enter the IPO from JPO:

  • Number of requests for the PPH in IPO is limited to 100 per year (based on first come first basis).
  • An Applicant may file not more than 10 PPH requests per year,
  • Request for assigning special status for expedited examination must be filed online using FORM 5-1 under the chapter 5 of PPH guidelines,
  • In case defects are notified by the IPO in Form 5-1, the Applicant will be given 30 days as time period to rectify the same.
  • Applicant may request for expedited examination on Form 18A only after the IPO has accepted the request for assigning special status for expedited examination filed on form 5-1 as prescribed in chapter 5 of PPH guidelines.
  • Notwithstanding the above procedure, the timelines for filing a request for expedited examination will be as prescribed under the Patent Rules, 2003.

PPH enables both powering up the patent prosecution process as well as weakening the global patent system in different ways. However, one can monetize based on the advantages of using PPH by consulting a qualified Patent Counsel for reviewing their patent application and identify strategies for maximizing the potential benefits of PPH programs.

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Patents (2nd Amendment) Rules, 2020 – Indian patent office updates fee schedule

IPAB

The Indian Patent Office in its notification dated November 04, 2020 presented Patents (2nd Amendment Rules), 2020. The Amendments have come into force on November 04, 2020.

The amendments bring forth significant changes to the fee schedule. The amended rules quashes the earlier categorization of applicants, for the purposes of fees, into three categories, viz., natural person or startup, small entity and others. According to the new rules, the applicants are now categorized into two categories, viz., natural person or startup or small entity and others.

Since small entity is now included in the same category as natural person and startup, the patent office fee for small entity is reduced and shall be same as the fee for natural person or startup. You may access the new fee schedule here.

Further, sub rule (3) of rule 7 is substituted with the following:

“(3) In case an application processed by a natural person or startup or small entity is fully or partly transferred to a person other than a natural person, startup or small entity, the difference, if any, in the scale of fees between the fees charged from the natural person, startup or small entity and the fees chargeable from the person other than a natural person, startup or small entity in the same matter, shall be paid by the new applicant with the request for transfer.

Explanation— Where a startup or small entity, having filed an application for a patent, ceases to be a startup or small entity due to the lapse of the period during which it is recognized by the competent authority, or its turnover subsequently crosses the financial threshold limit as notified by the competent authority, no such difference in the scale of fees shall be payable.”

The sub rule (3) of rule 7 is amended to include small entity into the same category as natural person and startup. The new rules set forth the following:

  1. In a scenario where an application is filed by a natural person, a startup or a small entity and is later transferred to a person other than a natural person, a startup or a small entity, the difference in fees due to the change in applicant status shall be paid by the new applicant with the request for transfer.
  2. In a scenario where an application is filed by a startup or small entity, and during the prosecution of the application, the applicant changes to others, either due to lapse of period which it is recognized by the competent authority, or its turnover subsequently crosses the financial threshold limit as notified by the competent authority, no difference in fee is payable.

Further, the proviso to sub rule (5) of rule 24C is substituted with the following:

“Provided that a request for expedited examination under this rule filed by a startup or small entity shall not be questioned merely on the ground that the startup or small entity, having filed an application for a patent, ceases to be a startup or small entity due to the lapse of the period during which it is recognised by the competent authority, or its turnover subsequently crosses the financial threshold limit as notified by the competent authority.”

According to the above presented proviso, in a scenario where the applicant is a startup or small entity and a request for expedited examination was filed by the applicant and the applicant status changes to others, either due to lapse of period which it is recognized by the competent authority, or its turnover subsequently crosses the financial threshold limit as notified by the competent authority, the request made for the expedited examination is not questionable.

In conclusion, The Patents (2nd Amendment) Rules, primarily tries to reduce the burden of fees incurred by small entity. This move coupled with the expedited examination will encourage small entities to file patent applications for their inventions.

Useful links:

Qualifying as a start-up as per the Indian Patent Rules

How to claim small entity status while filing for patents in Indian Patent Office

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Amendments to Rules 21 and 131(2), and its implications

Open book on wooden table. Knowledge and education conceptual image.

The Central Government in exercise of the powers conferred upon it u/s 159 of the Patents Act, 1970 (“The Act”) has passed the Patent Amendment Rules of 2020 (“The Rules”) on 19th of October, 2020. The rules aim to boost innovation while easing the burden on the patentee. The amendments to the Rules help in accelerating and easing the process of doing business in India for innovators. Particularly, the Rules include changes to Form 27, wherein the statements regarding the working of patented innovations on a commercial scale in India need to be filed by the Patentees or the Licensees.

The amendment has simplified the requirements related to submission of Form 27 by narrowing the compliance that need to be followed under Patent Rules by the patentee in the following manner:

  • The amendment provides flexibility to the patentee for filing a single Form 27 in respect of single or multiple related patents.
  • The approximate value corresponding to a single patent cannot be derived separately from approximate value corresponding to each of the related patents, and all such patents are granted to the same patentee or licensee. Accordingly, if there is a grant of patent to two or more persons, they may jointly file a Form 27.

The amended Rule 131(2) indicates that the time period for the patentee to furnish the information required in Form 27 shall now be once in every financial year i.e., within 31st of March of every year, unless specifically asked by the Controller. The information in Form 27 is required to contain details pertaining to the preceding calendar year, commencing soon after the financial year in which the patent was granted. Further, the details need to be furnished within 6 months instead of the current 3 months from the expiry of each financial year and hence the due date for filing will be 31st September of every financial year.

Further, The Rule 21 now includes compliance to additional requirements of paragraph (a), (b) or (b-bis) of rule 17.1 of the Regulations under Patent Cooperation Treaty (PCT). According to the amendment to Rule 21, the statement is regarding the verified English translation of priority document. The amendment indicates the following:

  • A patentee filing an international application designating India, who has not complied with the requirements of filing priority documents under the regulations of the PCT, is required to file the priority documents with the Indian Patent Office.
  • The applicant is not required to submit the priority document to the Indian Patent Office if the priority document is available in the World Intellectual Property Organization’s digital library.

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Impact of Post Grant Opposition on Rights of a Patentee

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An interim order of the High Court of Delhi in Novartis AG Vs. Natco Pharma Limited dealt with rights of a patent owner when the patent is subjected to post grant opposition. The judgment can be downloaded here

Natco had filed a post grant opposition on a patent granted to Novartise. The Opposition Board has reserved its order on April 10, 2019. In the meantime, Natco launched a product under the mark NOXALK even before the decision on the post grant opposition could be issued. In response, Novartise brought a suit seeking permanent injunction alleging infringement of its patent by Natco.

From a patent law perspective, the issue to be decided was whether a patent owner can initiate infringement proceedings when a post grant opposition is pending.

Natco relied on the decision of the Supreme Court in Aloys Wobben and Anr. vs. Yogesh Mehra and Ors. AIR 2014 SC 2210 to argue that once a post grant opposition is filed, the rights therein are yet to be crystallized, since the post grant opposition is pending. The Supreme Court in Aloys Wobben (supra) had held that right of a patent holder crystallizes only after challenges (post grant opposition) raised to the grant of a patent are disposed of favorably, to the advantage of the patent holder. Natco contended that, in the absence of such crystallization, the rights available to the patent holder under Section 48 of the Patents Act does not exist. In other words, Natco contended that since the decision in the post grant opposition is pending, Novartis lacks the right to initiate a patent infringement suit.

The judgment can be downloaded here

The High Court of Delhi, while acknowledging the decision of the Supreme Court, made a distinction that that although the rights are not crystalized, the rights still subsists even during the pendency of post grant opposition. The High Court further added that “Section 48 of the Patents Act grants rights in favour of a patentee, which are not affected during the pendency of a post-grant opposition.” Furthermore, the High Court observed that the facts of the present case in which an allegedly infringing product is launched prior to the decision in the opposition by the entity opposing the Patent, did not arise in the facts of Aloys Wobben (supra). In view of the foregoing, the High Court of Delhi passed an order restraining Natco, for the time being, from carrying out any fresh manufacturing of pharmaceutical preparations comprising of the active pharmaceutical ingredient (API), “Ceritinib”.

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Way Forward for the Critical Requirement of Furnishing Statement Regarding Working of Patented Invention in India

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Statute corresponding to patents in India has provisions that mandate furnishing of information that attempts to establish the extent to which patented technology is being worked on a commercial scale in India. The nature of the information sought is such that compliance with these provisions is onerous, if not impossible, given the changing dynamics of business and inventions. Consequently, one could argue that most of the patent owners have in-principle failed to comply with these provisions. Further, although there are penal provisions applicable for noncompliance, such provisions have never been exercised.

Concerns regarding the above discussed provisions always existed among patent professionals and other stakeholders. However, these provisions are now being discussed extensively because of a public interest litigation, and the order that followed. The provisions, which are at the centre of the controversy include Sections 146(1), 146(2), 122, Rule 131 and Form 27.

146. Power of Controller to call for information from patentees

(1) The Controller may, at any time during the continuance of the patent, by notice in writing, require a patentee or a licensee, exclusive or otherwise, to furnish to him within two months from the date of such notice or within such further time as the Controller may allow, such information or such periodical statements as to the extent to which the patented invention has been commercially worked in India as may be specified in the notice.

(2) Without prejudice to the provisions of sub-section (1), every patentee and every licensee (whether exclusive or otherwise) shall furnish in such manner and form and at such intervals (not being less than six months) as may be prescribed statements as to the extent to which the patented invention has been worked on a commercial scale in India.      

122. Refusal or failure to supply information.

(1) If any person refuses or fails to furnish

(a) to the Central Government any information which he is required to furnish under sub-section (5) of section 100;

(b) to the Controller any information or statement which he is required to furnish by or under section 146, he shall be punishable with fine which may extend to ten lakh rupees.

(2) If any person, being required to furnish any such information as is referred to in sub-section (1), furnishes information or statement which is false, and which he either knows or has reason to believe to be false or does not believe to be true, he shall be punishable with imprisonment which may extend to six months, or with fine, or with both.

131. Form and manner in which statements required under section 146(2) to be furnished.

(1) The statements shall be furnished by every patentee and every licensee under subsection (2) of section 146 in Form 27 which shall be duly verified by the patentee or the licencee or his authorised agent.

(2) The statements referred to in sub-rule (1) shall be furnished in respect of every calendar year within three months of the end of each year.

(3) The Controller may publish the information received by him under subsection (1) or subsection (2) of section 146.

(Emphasis added)

 

Section 146(1) recited above gives power to the Controller to call for information describing the extent to which the patented invention has been commercially worked in India. In practice, the Controller can exercise the power conferred by the referred section to decide request for compulsory licence to a patent, which may not be sufficiently worked in India.

On the other hand, Section 146(2) read with Rule 131 requires every patentee and licensee to furnish, every year, information describing the extent to which the patented invention has been commercially worked in India. Failure to comply with either of the above referred sections attracts penal provision as recited in Section 122.

In our view, Section 146(1) is an extremely useful provision, which may be exercised in specific circumstances, as explained earlier. However, an amendment to the section to explicitly recite the circumstances under which the Controller may/shall exercise the power to call for information, may prevent arbitrary use of such power.

The real problem, in our opinion, lies with Section 146(2), which requires voluntary submission of information, on a yearly basis, describing the extent to which the patented invention has been commercially worked in India. In our view, Section 146(2) should be amended to require at least one among patentee or licensee to state whether the patented invention is commercially worked or not in India, instead of requiring information concerning the extent of working of patented invention in India.

Our proposed amendment to Section 146(2) is based on the very purpose of having this provision in the Act, and the practical usage of the information furnished under this provision. The information submitted under Section 146(2) may be used to adjudicate request for compulsory licence to a patent, request to revoke a patent, or request for injunction. However, the proceedings concerning each of the listed requests may typically involve extensive submission, by parties involved in the dispute, of information describing the extent to which the patented invention is commercially worked in India, and the eventual judgement may rely of such information, and not on the information submitted under Section 146(2) on a yearly basis. In case the listed topics were to be adjudicated purely based on information collected under Section 146(2), then the efforts involved in putting together such information is colossal, if not impossible for large patent portfolios. The legislature also recognises the same, and its intent is expressed by the very fact that Section 146(1) exists. In view of all this, the information sought under Section 146(2) is redundant, and unnecessarily burdensome.  

In conclusion, in our opinion, Section 146(2) should be amended such that, it should suffice if the patentee submits whether the patented invention is worked or not commercially in India, on a yearly basis. In case the patented invention is not worked, then the patent may be considered for license or compulsory licence, by third party. On the other hand, if the patented invention is marked as worked, then in all probability, detailed proceedings would follow when the patent is the subject matter of a challenge, in which case the Controller has the power to call for information under Section 146(1).

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India working towards disposing pending patent applications in the next two years

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Minister for Commerce and Industry, under which the Department of Industrial Policy and Promotion (DIPP) functions, has been taking several initiatives for substantive improvement of IP environment in India. The recent initiatives include comprehensive National IPR policy, relocation of Copyright Office to DIPP, merger of the Copyright Board with the Intellectual Property Appellate Board (IPAB), establishment of Cell for IPR Promotion and Management (CIPAM) and launch of Start-up Intellectual Property Protection (SIPP) scheme, among others.

Adding to the above initiatives, the office of Controller General of Patents, Designs and Trade Marks (CGPDTM) is making efforts to clear the backlog of about 2.3 lakh pending patent applications. DIPP has hired substantial number of examiners and is likely to dispose these pending applications in next two years. The introduction of expedited examination and the recruitment of around 450 patent examiners to add to the pool of existing 130 examiners at the Intellectual Property Office (IPO) is witness to such efforts of the DIPP. This recruitment has increased the speedy disposal of pending patent applications. In the year 2016-17, about 9,847 patents were granted by the IPO, as against 6,326 in the previous year. IPO has improved its count in issuance of examination reports, which has increased to 6,000 patent applications a month from the earlier 1,500 applications.

Suresh Prabhu, Minister for Commerce and Industry, while addressing the Leadership Summit on Anti-Counterfeiting and Brand Protection at New Delhi last month, highlighted the efforts and initiatives of DIPP and IPO to dispose off the pending applications at the earliest. He announced that the Ministry is working to come up with an effective plan by which patent applications will be disposed in the least possible time. These initiatives are expected to bring down the pendency of patent applications and targeted at final disposal of patent applications from the present 5-7 years to less than 18 months.

We welcome the initiatives and efforts of the ministry in establishing a strong IP regime, and more importantly a time bound one, which is likely to boost innovation in the country.

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