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.
Delhi High Court Reaffirms Computer-Related Invention Patent Criteria.
An appeal filed by Raytheon Company (Raytheon) challenged an impugned order dated Oct 17, 2019, issued against its Indian patent application for a method of scheduling in a high-performance computing system. The impugned order refused the grant of Raytheon’s patent application on the grounds of “lack of inventive step” and “non-patentability” under section 3(k) of the Indian Patents Act, 1970.
The Assistant Controller of Patents and Designs (Controller) relied on the following test indicators while deciding on the ground of non-patentability under section 3(k) of the Act:
- Properly construe the claim and identify the actual contribution;
- If the contribution lies only in mathematical method, business method or algorithm, deny the claim; and
- If the contribution lies in the field of computer programmes, check whether it is claimed in conjunction with novel hardware and proceed to other steps to determine patentability concerning the invention.
Based on these test indicators, Raytheon’s patent application was declared solely as software, without having any novel hardware, and that the processor executed programme/algorithm in a conventional manner. Hence, the contribution of Raytheon’s patent application was declared as a non-patentable subject matter, and a grant of patent was refused.
Dissatisfied with the Controller’s decision, Raytheon appealed before the erstwhile Intellectual Property Appellate Board (IPAB). However, with IPAB’s dissolution in April 2021, the case was transferred to the Intellectual Property Division (IPD) of the Delhi High Court.
The appeal contended that:
- The Controller made a fundamental error of following test indicators of outdated Computer Related Invention (CRI) guidelines of 2016 while deciding merit of the Raytheon’s patent application on the ground of “Non-patentability u/s 3(k)” instead of following the updated CRI guidelines of 2017.
- The Controller wrongfully refused Raytheon’s patent application on the grounds of “lack of inventive step” without considering Raytheon’s arguments.
Based on Raytheon’s contention, the Court analyzed the impugned order and observed that the Controller had indeed tested patentability based on the presence of novel hardware but not on the technical contribution of the invention disclosed in Raytheon’s patent application.
Referring to the updated CRI guidelines of 2017 that stated “Claims which are directed towards computer programme per se are excluded from patentability” [Section 4.5.4], the Court reaffirmed that the to ensure that only computer programmes “as such” are not granted but genuine inventions which are developed based on computer programmes should not be refused patents if they contain certain other things, ancillary thereto or developed thereon. Further, the court ruled that the Controller’s focus should be on the substance of the claims and not on form or presentation. The Court further referred to the interpretation of section 3(k) in the judgments from Ferid Allani v Union of India (Ferid Allani) and Microsoft Technology Licensing v Assistant Controller of Patents and Designs (Microsoft) and clarified that in the case of CRIs, the technical effect of the invention is what needs to be examined and not to insist on a novel hardware requirement.
Relying mainly on the updated CRI guidelines of 2017 and well-settled interpretation of 3(k) in the cases of Ferid Allani and Microsoft, the Court declared that the Indian Patent Office (IPO) was in error as it failed to examine the patentability of the invention based on the underlying subject matter and the technical contribution of the invention, and thereby set aside the impugned order. Keeping in mind the time elapsed since the filing date of Raytheon’s patent application, the Court directed the IPO to re-examine and dispose the Raytheon’s patent application within three months from the date of the Court’s order.
By emphasizing the significance of an invention’s technical contribution or technical effect over the mere presence of novel hardware, the Court has provided clearer guidance for CRI-related patent evaluations. This reaffirmation of focus is likely to have a profound impact on software-centric innovations, ensuring that genuine technical advancements receive the patent protection they deserve, without insisting upon the requirement of novel hardware. As a result, applicants’ can now approach the IPO with greater clarity and confidence, knowing that their software inventions will be assessed based on technical merits by following the latest CRI guidelines rather than expecting innovation on hardware systems which is nothing but a higher standard that has no basis in the patent law.