Concerns over handling of personal data by foreign-owned/funded entities
In a recent Public Interest Litigation (PIL) addressed by the Delhi High Court, Ashwini Kumar Upadhyay v Union of India, a critical spotlight was cast on the practices of foreign-owned companies that collect personal information through travel booking platforms in India.
This judgment underscores the significant challenges and stringent requirements for personal data protection under Indian law, emphasizing the need for all international corporations to adhere closely to Indian personal data protection regulations.
In early 2024, a PIL was filed by Ashwini Kumar Upadhyay (Ashwini), highlighting concerns about the collection of personal data (including Aadhaar – India’s unified identification system that contains demographic and biometric data, and passport details) by foreign-owned travel companies operating in India. This extensive reach of data collection extends to both ordinary citizens as well as high-profile individuals such as legislators, ministers, judges, military personnel, government officials, and their families. Furthermore, several of these companies are partially or fully owned by Chinese investors raising concerns of potential misuse of personal data. The PIL therefore, pressed for enhanced privacy protection of personal data, both domestic and foreign, amassed by travel companies during booking processes.
Referring to the 2017 Justice K.S. Puttaswamy (Retd.) vs Union of India case, which established privacy as a fundamental right under Article 21 of the Indian Constitution, the petition reinforced the fundamental right of privacy. Notably, Section 3 of the Digital Personal Data Protection Act, 2023 (DPDPA) was also highlighted in the petition, which extends its jurisdiction to handling digital data within India, regardless of where it is processed.
However, in the decision dated April 3, 2024, the Division (two-judge) Bench disposed of the petition without delving into the specific complaints, reasoning that Ashwini had not filed any representation with the Union of India –– which is typically required before approaching the Court. The Court thus allowed Ashwini the liberty to raise this grievance with the government. Additionally, the Court clarified that it has not commented on the merits of the issue.
While the Court’s decision to not delve into the merits of the case leaves many questions unanswered, it signals the pressing need for a comprehensive administrative and legal framework to ensure the protection of personal data across the wide spectrum of both domestic and international businesses. It highlights the need for businesses to comply with data protection laws and the potential reputational risks associated with the mishandling of personal data. For policymakers, this case is a reminder to tighten data privacy laws and ensure the robustness of their implementation to address challenges arising from businesses handling large volumes of personal data.
Milind Yadav and S Chandrasekhar are colleagues from K&S Digiprotect Services Pvt. Ltd, an affiliate of K&S Partners which delivers premier consultancy in data privacy, information security, and digital estate management.
Google penalized by Delhi High Court for misrepresenting disclosures
In a notable judgment in early April, the IP Division of Delhi High Court dismissed Google LLC’s (Google) appeal against the rejection of its patent application by the Assistant Controller of Patents and Designs (Controller), and imposed a fine of Rs 1 lakh (~USD 1,200) on the tech giant for presenting incorrect information and failing to disclose critical details about its corresponding applications in Europe.
In 2007, Google filed a patent application before the Indian Patent Office (IPO) for its technology that enables users to manage seamless instant messaging across different smart devices like desktops and PDAs, irrespective of the device. The application was rejected by the Controller based on lack of novelty and inventive step in view of prior art.
Aggrieved by the impugned order, Google appealed before the erstwhile Intellectual Property Appellate Board (IPAB). After the dissolution of IPAB in 2021, the case was transferred to the Delhi High Court where it was eventually heard in December 2023. During the proceedings involving detailed arguments on novelty and inventive step by both sides, the Court inquired about the status of the corresponding patent applications in other countries. Google responded by stating that the US and Canadian patent applications were granted, while the European patent (EP) application was abandoned. The IPO’s Counsel refuted this by pointing out that the EP application had in fact been rejected on the basis of lack of novelty and inventive step and not abandoned. Court also found that a divisional application with the identical title as that of the rejected EP application had also been filed and its status was also disclosed as “abandoned”, when in fact it was also rejected on the same grounds.
Taking serious note of Google’s conduct in the proceedings, the Court noted that Google had misrepresented facts to the IPO as well as the Court which also breached its duty of disclosure under the Patents Act, 1970 (Act).
The Court finally dismissed the appeal on merits for not meeting the novelty and inventive step requirement. Additionally, the Court ordered Google to pay costs of INR 1 Lakh (~USD 1,200) for presenting wrong facts to the Court and not meeting the disclosure requirements under the Act.
This judgment re-emphasizes the necessity for applicants to provide complete and accurate information throughout the application process, especially concerning information related to corresponding foreign patent applications, which may be material to the grant.
Delhi High Court awards Ericsson $29 million in SEP case
K&S’ latest article written by Pramod Kumar, Naveen Suriya, and Partner & Sanjeev Kumar Tiwari which analyses the Delhi High Court’s landmark decision to award Ericsson USD 29 million in damages, the highest SEP-related damages awarded in India, for the Patent Lawyer’s newsletter.
Asserting Patent Infringement with the help of Doctrine of Equivalence
The overarching issue in SNPC Machines Private Limited & Ors. v. Mr. Vishal Choudhary revolves around the application of the doctrine of equivalents to determine patent infringement, focusing on whether functional similarities between two competing brick-making machines constitute a violation of patent rights, despite differences in their physical designs and mechanisms.
In April 2024, the plaintiff, SNPC Machines Private Limited & Ors. (SNPC), filed an infringement suit related to brick-making machines against defendant, Vishal Choudhary (Vishal Choudhary), sold under name of Padma Brick Making Machine in the Delhi High Court. The suit sought “permanent injunction” restraining Vishal from using, making, manufacturing, offering for sale or selling or importing impugned brick-making machines.
The suit patent in question is SNPC’s mobile brick-making machine that molds and lays bricks as it moves, controlled by an operator from a cabin. SNPC claimed that Vishal’s machine is doing the same work, in almost the same manner to accomplish the same results as SNPC’s brick-making machine.
However, Vishal contented that there were distinct differences between the two – Vishal’s machine lacked a cabin and steering mechanism, was designed to be towed by a tractor instead of an integrated mobility system like SNPC’s machine and utilized kinetic energy for operation, in contrast to the electrical energy powering SNPC’s machine.
Vishal argued that since their machine did not include every element specified in the patent claims, they did not infringe on the suit patent, invoking the ‘all elements rule’ as a defense. Furthermore, they raised the issue of prosecution history estoppel, stating that SNPC has previously focused only on roller and die assembly matters, which helps in shaping and forming the bricks, whereas now it was also emphasizing the machine’s integrated mobility.
SNPC countered stating that such differences were “trifling and insignificant” and that Vishal’s machine performed absolutely no function while it was stationery, and therefore included wheels to ensure mobility. They invoked ‘the pith and marrow of the invention’ principle and urged the Delhi High Court to not focus only on the “literal infringement”. Furthermore, they urged the Court to apply the “Doctrine of Equivalents”, to check whether the substituted element in the infringing product does “the same function” in substantially “the same way” to accomplish substantially “the same result” (triple identity test). In other words, SNPC claimed that Vishal had merely replaced the integrated mobility of SNPC’s machine with the tractor, to achieve exactly the same result.
The Court concurred with SNPC that the Doctrine of Equivalents should be applied, using the triple identity test, to determine if Vishal’s machine performs the same function in the same way to achieve the same result as SNPC’s product. The doctrine suggests that an invention can infringe on a patented invention if it functions almost the same way and produces a similar result as the patented invention, even if there may be minor differences between the elements or features of the two products. In other words, if the infringing product is equivalent to the patented invention in terms of its functionality, it may still be considered infringing.
Further the Court noted that while there were differences between SNPC and Vishal’s machine, these differences did not detract from the fundamental aspect of the invention – i.e., the mobility to ensure mobility of the assembly, albeit through different mechanisms. The Court concluded that these differences, according to the doctrine of “the pith and marrow”, were integral to the core functionality of the invention. The Court further interpreted that, without “mobility” the Vishal’s machine would serve no purpose considering it had a roller and die mechanism as well, therefore did not absolve them of infringement.
The Court considering all the facts and evidence, submitted granted a interim injunction in favor of SNPC, restraining Vishal from manufacturing and selling brick-making machines similar to the Plaintiffs’ patented brick-making machines. By focusing on the essential functionality of the patented invention, the Court helped protect SNPC against infringement, promoting innovation and fair competition in the market.
This judgment highlights the importance of the doctrine of equivalence in patent infringement cases, where there are two similar products and the question is whether one product performs the same function in the same way to achieve the same result as the patented invention, despite minor differences in their elements.
Delhi High Court Restricts Sale of Refurbished Goods for ‘Reverse Passing-Off
Reverse passing off is not something that courts encounter every day. It occurs when a defendant purchases a plaintiff’s product, repackages, and sells it under the defendant’s mark or name, resulting in the public coming to associate the qualities of the plaintiff’s product with that of the defendant.
When this adversely affects the goodwill of the plaintiff, it is a reverse passing off. Recently, the Delhi High Court addressed this issue in Western Digital Technologies Inc & Anr vs Geonix International Private Limited.
The plaintiffs, Western Digital Technologies Inc and its subsidiary (Western Digital), manufacture storage devices under the trademarks ‘WESTERN DIGITAL’ and ‘ULTRASTAR’. They sued Geonix International Private Limited (Genoix) for refurbishing and rebranding storage devices, media players, routers, switches, bridges, desktops and solid-state drives (SSDs) and hard disk drives (HDDs), originally manufactured by Western Digital and selling them as new under the trademark ‘GEONIX’.
Upon becoming aware of the violation, Western Digital investigated the activities of Geonix, and the findings confirmed the refurbishment and rebranding of their products by Geonix. It was found that Geonix physically altered Western Digital’s trademarks, serial and model numbers, and other identifiers from the HDDs. Further, they effaced the erstwhile model and serial number on the printed circuit board (PCB) of the HDDs by reformatting the PCB with their own markings. Thereafter, Geonix rebranded and repackaged the discarded HDDs under the mark ‘GEONIX’, and sold these to customers by misrepresenting them to be new and unused HDDs.
Western Digital argued before the Court that this constituted a violation of the statutory rights in their trademarks. Further, they raised the issue of protection of consumer interest from deceptive marketing practices of Geonix. Western Digital demonstrated through technical test reports that despite the reformatting, refurbishing, and rebranding of HDDs by Geonix, Western Digital could still be identified as original manufacturers of the HDDs. This was found when a report was generated by running the HDDs on a device. Based on this evidence, Western Digital argued that Geonix has been unsuccessful in fully erasing the connection between the HDDs and Western Digital, and that, this constituted reverse passing off.
Geonix’s defence that they sell the products under their own brand and that the principle of exhaustion of trademark rights would apply to the case was rejected by the Court. Finding a strong prima facie case, the Court granted an interim injunction to Western Digital and restrained Geonix from altering or selling HDDs bearing the trademarks of Western Digital. The case will now be listed on April 3, 2024.
IPO ends decade-long pre-grant opposition to Gilead’s Sofosbuvir prodrug
In a landmark case, Gilead Pharmasset, LLC v Sankalp Rehabilitation Trust and Ors., the Indian Patent Office (IPO) in Kolkata granted a patent to Gilead Pharmasset, LLC (Gilead), covering the prodrug molecule of anti-HCV drug Sofosbuvir. The IPO rejected all the 13 pre-grant oppositions, filed by various opponents including pharma companies, advocacy groups, and individuals against the patent application. The case spanned a decade.
The patent application was opposed primarily on the grounds of lack of novelty, lack of inventive step, non-patentability under section 3(d), and insufficiency of disclosure and failure to disclose information under section 8 of the Indian Patent Act, 1970. Since these multiple oppositions were filed at varying intervals, the grant proceedings were substantially delayed.
After considering all the materials on record, the Controller of Patents (Controller), held as follows: made the following key findings:
- Validity of priority date of the application: The Opponents challenged the priority application dated March 30, 2007, based on the patent application US 60/309,915 and argued that submitted documents D23 and D24 should be considered valid prior art for assessing the novelty of the claims. However, the IPO found these arguments unpersuasive, noting that the priority document was valid and adequately disclosed the claimed compound’s components and stereochemical configurations.
- Lack of Novelty: The IPO concluded that the claimed compounds were novel due to their structural differences and lack of explicit disclosures in the cited documents, strengthening the novelty of the claimed compound and its process of preparation.
- Lack of inventive step: The IPO acknowledged the uniqueness of the claimed compound comprising specific moieties and substituents, which were not obvious compared to the cited prior art. The IPO also rejected the opponents’ arguments suggesting the compound was obvious in view of prior art disclosing HIV or cancer treatments, emphasizing that applying these teachings to HCV treatments without considering structural and stereochemical aspects would be implausible.
- Non-patentability under section 3(d): The IPO rejected the argument that the claimed invention was a mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of the substance. It held that the opponents’ reliance on prior art failed to establish the existence of any known substance with similar structure and efficacy to the claimed compound, or that the claimed invention lacked novelty and efficacy.
- Sufficiency of disclosure: The IPO found that the invention’s description in the application extensively covers the structure, stereochemistry, and preparation methods of the claimed compounds. Furthermore, examples and procedures outlined in the description provide adequate guidance and the claimed compound’s process, enabling skilled practitioners to understand and implement them effectively.
K&S Partners’ team comprising Litigation Practice Chair, Sanjeev Kumar Tiwari, Practice Lead (Life Sciences, Chemistry & Pharma, Amrish Tiwari and Partner and Chem-Pharma Patent Expert, Dr Jyoti Choithani Ramani, successfully represented Gilead Pharmasset, LLC in this important case.
Court Rules Data Privacy Prevails Over Business Methods in E-Commerce
In a pivotal decision, in the case Priya Randolph v the Deputy Controller of Patents and Designs, the Madras High Court has significantly impacted the criterion of patentable inventions in India, safeguarding a privacy-focused technology amidst e-commerce giants.
Priya Randolph and Rohit Chaturvedi (inventors) sought patent protection for their system that selectively conceals user data, specifically physical addresses, during e-commerce transactions. However, after their application was dismissed as a non-patentable “business method” under Section 3(k) of the Indian Patents Act, 1970 (the Act), the inventors approached the Court.
The inventors primarily contended that the claimed invention, encompassing hardware, software and firmware, was a technological advancement that furthers privacy and data protection, not business method, as asserted by the Deputy Controller of Patents and Designs (Deputy Controller).
The Deputy Controller argued that since the invention has involvement in e-commerce, it naturally fell under business methods and Section 3(k) automatically applied, rendering it ineligible for patent protection.
The Court, guided by para 4.5.2 of the Guidelines for Examination of Computer Related Inventions of 2017 (CRI Guidelines), clarified that merely touching upon e-commerce doesn’t automatically classify an invention as a business method. It emphasized the importance of the invention’s substance, specifically in this case, the invention’s distinct technological contribution to data privacy beyond routine business processes.
Consequently, the initial rejection was set aside, and the matter remanded for reconsideration by a different officer. The inventors were granted a reasonable opportunity to further present their case, with a reasoned decision expected within four months.
This order re-emphasizes the important markers made in the CRI guidelines for business method that the substance of claims matter, not the form in which they are presented.
Patentability of Synergistic Combinations Yielding New and Improved Results
In a notable ruling in the case, Biomoneta Research Pvt ltd. v Controller General of Patents Designs, the Delhi High Court (Court) resolved an appeal by Biomoneta Research Pvt. Ltd. (Biomoenta) against the Controller General of Patents and Designs’ (Controller) rejection of their 2017 patent application for an ‘Air Decontamination Assembly.’
The case is significant for its detailed analysis of inventive step in patent law and the Court’s consideration of European patent guidelines.
Biomoneta contended the rejection of its patent application, which was previously followed by a PCT Application and subsequent national phase applications in the US Patent and Trademark Office and European Patent Office (EPO). The Indian Patent Office (IPO) had objected to the application, citing a lack of inventive step under Section 2(1)(ja) of the Indian Patents Act, 1970, (the Act) and referenced three prior art documents (D1 to D3).
In its defense, Biomoneta emphasized the uniqueness of its air decontamination technology, which utilized a low voltage electric field and conducting plates with 3D material, arguing its effectiveness against viruses like COVID-19 and features like filter-less operation and reduced power consumption.
The Court first referred to the judgement in F. Hoffmann-La Roche Ltd. v Cipla Ltd, for the “test to be followed for determining inventive step and lack of obviousness,” and Documents D1-D3. The Court noted that Biomoneta’s invention shared some features with existing technologies, such as the use of conducting plates and electric fields. However, Biomoneta’s unique combination of these elements with low voltage electric fields and 3D material-coated plates demonstrated an inventive step. This combination led to advancements like filter-free operation, reduced power consumption, and effective pathogen elimination, setting it apart from prior art and justifying the patent grant.
Further, the Court referenced the EPO guideline on combining features versus mere juxtaposition in patent claims; these guidelines emphasized that an invention should be assessed as a whole and not merely upon the combinations. Further, if the combination of features yields a new and improved result, it merits patentability. The Court found that Biomoneta’s device, addressing several disadvantages of existing technologies, wasn’t just a simple combination of known features but involved an inventive step. The Court also stated that while secondary considerations alone don’t make an invention patentable, combining existing results in a novel, beneficial way can justify a patent grant.
The Court’s decision was further influenced by the grant of a corresponding US patent, viewing it as corroborative of the invention’s novelty and inventiveness. As a result, the Court overturned the previous rejection, directing the patent application to proceed for grant.
This decision stands out for its detailed examination of inventive step, considering both Indian and European patent law principles. It emphasizes the importance of a holistic and comprehensive approach in patent adjudication, especially in complex technological fields, setting a valuable precedent for future patent assessments.
Inventiveness Test Should Be Applied to Entire Invention, Not Parts
In the matter of Groz-Beckert Kg v Union of India & Ors, the Calcutta High Court heard the appeal of Groz-Beckert KG (GBKG) against the rejection of their patent application by the Controller of Patents and Designs (Controller).
The case dealt with the issue of whether, can an invention be assessed on its constituent parts, while evaluating its patentability.
GBKG’s patent application was for a method and apparatus for processing textile materials, designed to improve the efficiency and functionality in the textile industry, granted in over 11 jurisdictions worldwide. However, the Controller rejected it stating it lacked an inventive step under Section 2(1)(ja) of the Indian Patents Act, 1970 (Act) and also formality issues concerning the submission of the Proof of Right.
GBKG argued that the Controller’s finding was based on an incorrect assessment of the invention by dividing it into two parts, rather than viewing it as an integrated invention comprising of multiple interlinked features.
The Court, referring to the guidance on this aspect provided by the Indian Manual of Patent Office Practice and Procedure (the Manual), agreed with GBKG’s contentions. Citing the precedent set in Bishwanath Prasad Radhey Shyam v Hindustan Metal Industries, the Court emphasized the necessity of strictly and objectively judging the “obviousness” of an invention and considering it in entirety, rather than as isolated parts. The Court also observed that the Controller had overlooked the technical advancements claimed by GBKG. Drawing from the principles outlined in State Bank of India v Ajay Kumar Sood, the Court noted that the rejection was based on incomplete facts and lacked reasoning.
Consequently, the Court overturned the Controller’s decision and directed a fresh evaluation of the patent application within three months, ensuring GBKG’s right to a hearing.
High Court Affirms Scotch Whisky Association’s GI Infringement Lawsuit Right
The Scotch Whisky Association (SWA), a company incorporated in the UK won an appeal (Scotch Whisky Association v J.K. Enterprises & Ors) before an Appellate Bench of the High Court of Madhya Pradesh in Indore.
The appeal arose from an order passed by the Commercial Court in District Indore. The Commercial Court held that SWA’s suit for infringement of its geographical indication (GI) Scotch Whisky, against the defendant JK Enterprises (JKE), was maintainable only if it impleaded an ‘authorised user’ of the GI as a necessary party.
The concept of ‘authorised user’ is unique to the Indian GI law. It essentially refers to any person claiming to be the producer of the goods in respect of which a GI has been registered. The Geographical Indications of Goods (Registration & Protection) Act, 1999 (the GI Act) permits authorized users to register themselves with the GI Registry. They can even sue for infringement, among other rights.
JKE defended the appeal and argued that SWA was not entitled to sue independently for infringement under Section 21(1) of the GI Act without impleading an authorized user as a necessary party. Section 21 (1) reads as follows:
21. Rights conferred by registration.
(1) Subject to the other provisions of this Act, the registration of a geographical indication shall, if valid, give,-
(a) to the registered proprietor of the geographical indication and the authorised user or users thereof the right to obtain relief in respect of infringement of the geographical indication in the manner provided by this Act;
(b) to the authorised user thereof the exclusive right to the use of the geographical indication in relation to the goods in respect of which the geographical indication is registered.
It was JKE’s argument that the ‘and’ in Section 21(1)(a) of the GI Act must be read conjunctively and not disjunctively. When done so, JKE argued, there would be a requirement to implead the authorized user along with the registered proprietor in a suit for infringement.
In examining this issue, the Court looked at India’s obligations under the WTO’s TRIPs Agreement. It noted that the interpretation of the provisions of the GI Act, enacted in pursuance of the obligations under the TRIPs Agreement, must be in tune with such obligations and such interpretation must be purposive. Thereafter, the Court reviewed the provisions of the GI Act to understand the role of the registered proprietor and the authorised user. The Court’s review indicated that there are various provisions under the GI Act where the registered proprietor can act in its own right, without involving the authorized user. Two such provisions cited by the Court pertain to renewal of the GI and seeking additional protection. The Court also referred to Section 68 of the GI Act which specifically lists certain proceedings where the authorised user must be impleaded. Based on these provisions, the Court concluded that the registered proprietor has an independent legal status and entitlement to relate itself to the GI.
Citing the principle of “ubi jus ibi remedium,” (if there is a right, there is a remedy,) the Court pointed out that the legislature could not have been presumed to have conferred exclusive rights on the authorized user to the exclusion of the registered proprietor, who is the originator of the GI registration. The Court thus concluded that the word ‘and’ used in Section 21(1)(a) of the GI Act must be treated as ‘or’, else it would lead to a situation where the status of a registered proprietor of a GI would be pushed below that of the authorised user.