The Credible Challenge to Validity

1The principle relating to ‘serious question as to validity’ or a ‘serious question to be tried’ has been applied by the courts in India with varying effect in determining the prima facie validity of a patent for the purpose of granting interim injunction. (See Niky Tasha India Pvt Ltd v Faridabad Gas Gadgets Pvt Ltd AIR 1985 Del 136; Hindustan Lever Ltd v Godrej Soaps Ltd 1997 PTC 756; Franz Xaver Huemer v New Yash Engineers AIR 1997 Del 79; Gandhimathi Appliances Ltd v LG Varadaraju (2000) 3 MLJ 85.) In Niky Tasha, a case relating to a registered design under the Indian Patents and Designs Act, 1911, a Division Bench of the Delhi High Court followed the view taken in American Cyanamid and stated: (Niky Tasha India Pvt Ltd v Faridabad Gas Gadgets Pvt Ltd AIR 1985 Del 136.)

I take it to be well settled, both in India and England, that an interlocutory injunction will not normally be granted where damages will provide an adequate remedy, should the claim succeed. Furthermore, I have always understood the rule to be that the Court will not grant an interlocutory injunction unless satisfied that there is a real possibility of the plaintiff succeeding on the trial of the suit. When the design is of recent date, as in this case, no injunction should be granted. More so, when there is a serious question as to the validity of the design to be tried in that suit and an application for cancellation, has been made.

2With regard to the issue of prima facie validity of a patent, the Calcutta High Court in Hindustan Lever Ltd v Godrej Soaps Ltd refused to apply the decision in American Cyanamid stating the dictum of the apex court in Bishwanath Prasad Radhey Shyam v Hindustan Metal Industries (1978) that there can be no presumption in favour of the validity of a patent. (1997 PTC 756, pp 775-76.) (AIR 1982 SC 1444.) In Bishwanath Prasad Radhey Shyam v Hindustan Metal Industries (1978) (para 32) the Supreme Court held that “the grant and sealing of the patent, or the decision rendered by the Controller in the case of opposition, does not guarantee the validity of the patent, which can be challenged before the High Court on various grounds in revocation or infringement proceedings”. As the case involved a patent dispute under Indian Patents and Designs Act, 1911 which came up before the Supreme Court when the 1970 Act was in force, it observed that “this position, viz. the validity of a patent is not guaranteed by the grant, is now expressly provided in Section 13(4) of the Patents Act, 1970”. The Supreme Court rejected the “argument that there is a presumption in favour of the validity of the patent”.

3The Madras High Court considered the decision in American Cyanamid on this point and concluded that the burden is on the plaintiff to demonstrate a prima facie case before claiming an interlocutory relief. Speaking for the Division Bench, Jayasimha Babu J said: (Gandhimati Appliances Ltd v LG Varadaraju (2000) 3 MLJ 85, pp 93, 95-96 (DB).)

Though the grant of a patent by itself does not guarantee its validity, the fact that a patent has been granted must be given some weight and significance while considering the question of prima facie case.

The plaintiffs are entitled to place reliance on the fact that they have already secured the patent. The grant of the patent does not on the basis of such grant, make the patent impregnable. The burden is always on the plaintiff to establish its case prima facie before it can claim any interlocutory relief. It is always open to the defendant to question the validity of patent. When the defendant is able to point out some grounds for regarding the patent already granted, as being prima facie invalid then at the interlocutory stage, this factor of patent having been granted to the plaintiff would cease to be of significance while considering the question of prima facie case. The burden of proof on the plaintiffs at the interlocutory stage, therefore is not so rigorous, as it would otherwise be, if no patent had been granted in the first place. … Applying the test set out in the decisions to which we have referred to earlier, the inevitable conclusion that we reach is that the product patented by the plaintiff, though when dissected and as a part taken separately may not show inventiveness, a combination of the same, and the fact that a new use has been discovered for a combination of known integers, and the further fact that inventive steps by way of ingenuity and skill were required to be and have been displayed in bringing about such a combination and discovering the mode of application of known integers for a product, whose usefulness has been demonstrated by the large number of units … sold by the plaintiffs… establish that the patent granted in favour of the plaintiffs cannot be regarded prima facie as invalid. The plaintiffs must be held to have made out a prima facie case for grant of an injunction so far as its patent is concerned.

4The courts have been cautious on how the presumption in favour of validity should be construed. In Garware Wall Ropes v A.I. Chopra (2008) (para 9) the Bombay High Court held that “Merely because there is no presumption in favour of a patent which is registered and sealed, one cannot jump to a conclusion that the fact of registration and sealing of patent should be ignored or that the Court should treat a registered and sealed patent valueless merely because a dispute has been raised by the contesting parties about the patent.”

5In F Hoffmann-La Roche v Cipla (2009) (paras 52, 53 and 65) the Division Bench distinguished the presumption of validity in the case of trade marks and patents and refused to accept the argument that if the patent application has gone through a “multi-layered, multi-level examination of the opposition to the grant of patent it should accorded the highest weightage.” The Court observed that even if a patent has survived pre-grant and post-grant opposition, it can “still be made vulnerable on grounds different from the ones raised at those stages”. However, the Court noted that if the challenge is on the same ground that were considered and rejected by Controller of Patents, the burden on the defendant will be of a higher degree to demonstrate the credibility of the challenge. In Chemtura Corporation v Union of India (2009) (para 35) the Delhi High Court, applying that decision, framed the question as “whether the defendants have ‘put forth a substantial question of invalidity to show that the claims at issue are vulnerable’?” In Merck Sharp and Dohme v Glenmark Pharmaceuticals (2015) (para 36) the Division Bench of the Delhi High Court reiterated the position that grant of a patent does not presume its validity.

6In AstraZeneca v Intas Pharmaceuticals (2020) the Delhi High Court held at the interlocutory stage that “even when the patent crosses the threshold of examination by the patent office, it does not, as per the Statute, warrant its validity” (para 18.1). The Court added that “The presumption of validity exists only till such time the patent is challenged - a challenge which is credible and no further” (para 18.3). The Court observed that “at the stage of preliminary injunction all that the defendant is required to demonstrate is that she/he has made a credible challenge or that the patent is vulnerable and that validity is not vexatious” (para 19.2).

7In AstraZeneca the Court observed that “The plaintiffs’ argument that the examiner should have been conscious of the inventive step objection or that evidence of technical advance could be placed before the Court even at this juncture fails to take into account the plain language of Section 64(1)(f) read with Section 2 (1)(ja) of the Act” (para 30.5), and that “Whether or not the examiner raised this issue, the defendants are certainly entitled to raise the same in defence to an infringement action” (para 30.6).

8In Kudos Pharmaceuticals v Natco Pharma (2024) the Delhi High Court held at the interlocutory stage that “the onus to establish that the challenge raised by it is credible, is on the respondent. A credible challenge ... is a challenge which is not incredible, fanciful, or moonshine, and must prima facie be acceptable.” (para 23) It held that “In examining whether the challenge raised is credible, a relevant consideration is the fact that the Patent Office has, after a thorough study, found the patent to be valid and capable of being granted”, and that “The same standard has to be adopted while examining vulnerability to revocation. The standard of credibility is, therefore, a high standard, not a low standard, as is commonly understood.” (para 23) It held that “As no credible challenge to the validity of the suit patent has been made out, the prayer for interlocutory injunction has necessarily to be granted.” (para 71)