Vringo Infrastructure Inc v Indiamart Intermesh Ltd (2014)

Summary

“This order shall dispose of an application being I.A. No.2112/2014 filed by the plaintiffs under Order 39 Rule 1 & 2 read with Section 151 CPC for confirmation of the ad interim stay granted on 03.02.2014 in the present suit.” (para 1) “In the instant case, the plaintiffs are alleging infringment of patent No.IN 200572” ... “which is titled as ‘a method and a device for making a handover decision in a mobile communication system’.” (para 4) “It is the case of the plaintiffs that the suit patent which was originally belonging to Nokia Corporation was assigned to them by a Confidential Patent Purchase Agreement dated 9.8.2012.” (para 8) “It is alleged that the defendants are infringing the suit patent of the plaintiffs by manufacturing, importing, selling, offering for sale infrastructure equipment including Base Station Controller” (para 7), and the plaintiffs relied on the “affidavit of Mr. Regis J. Bates JR as an expert, who has categorically stated that the patent of the plaintiffs has been infringed by the defendants.” (para 16) The defendants contended that “the affidavit which has been filed by the plaintiffs cannot be treated to be an affidavit of an expert” (para 17) and that “they have already filed a counter claim for revocation of the patent of the plaintiffs” (para 18).

The Court held that “the plaintiffs have not been able to make out a prima facie case, which is the first requirement before an injunction is granted in favour of the plaintiffs” (para 27), that “this also tilts the balance of convenience in favour of the defendants rather than the plaintiffs” (para 35), and that “the plaintiffs will not suffer an irreparable loss in case injunction granted stands vacated because the interest of the plaintiffs can be sufficiently protected by the directions passed by the Division Bench in F.A.O. No.573/2013 between the same parties.” (para 42) “With these directions, the application under Order 39 Rule 1 and 2 CPC stands disposed of inasmuch as the order of ex parte ad interim stay stands vacated, however, the defendant Nos.3 and 4 are put to certain terms and conditions before manufacturing, importing or selling their product in India.” (para 45)

What the court decided

1. Comparing the technologies. “This comparison prima facie, at this stage, cannot be done by the court as it essentially involves scientific evidence which needs great deal of specialized knowledge in telecommunications and experience as to how the cell phone technology functions. This can be opined by an expert, who has experience in the field of telecommunication and help the court in understanding the patent, its technology viz-a-viz the technology which has been adopted by the defendants.” (para 22)
2. Registration and validity. “There is no dispute about the fact that the technology of the plaintiffs is patented but unlike under Section 31 of the Trade Marks Act, 1999, there is no presumption of validity in favour of the plaintiffs that the technology is patented by the plaintiffs.” “This onus is very heavy on the plaintiff to be discharged in the first instance. The plaintiffs must establish such acts as will prima facie satisfy the court that there are strong and prima facie reasons for acting on the supposition that the patent is valid. It has been held in National Research Development Corporation of India vs. The Delhi Cloth & General Mills Co. Ltd. and Ors.; AIR 1980 Delhi 132 that the most cogent evidence for this purpose is either that there has been a previous trial in which patent has been held to be valid or that the patentee has worked the patent and enjoyed the same without dispute, either from the defendants or anyone. The defendants have set up a counter claim for revocation of the patent under Section 64 of the Act. Therefore, it cannot be said that the plaintiffs are having a prima facie good case on the basis of the registration of the patent alone. It is required to do something more.” (para 22)
3. The witness’s own disclaimer. “But immediately after opining so, he says that he is not a patent attorney and does not purport to provide expert opinions in this report on Indian patent law. Therefore, this one sentence in his affidavit that his opinion does not purport to be opinion on the Indian patent law completely, robs his opinion of any value which is sought to be attached to the same by the plaintiffs” (para 24)
4. A self-favouring affidavit. “Moreover, the affidavit filed by the plaintiffs is in the nature of self favouring admission which is not relevant under Section 21 of the Evidence Act. The said Section makes self harming admissions relevant except in three contingencies which are mentioned in the proviso. Obviously, the case of the plaintiffs does not fall in any of these contingencies.” (para 24)
5. Expert under section 45. “The reason for this is that before his opinion in the form of the present affidavit could be termed to be the opinion of an expert, he ought to have some basic degree in science or telecommunication or B.Tech engineering dealing in telecommunication and electronics and thereafter some research work having been conducted by him which would have qualified him to be an expert” ... “On the contrary, he only has a degree in business administration and his holding of different assignments and posts only shows that though he was employed by various telecommunications or computer companies, but the nature of work was essentially of a ‘generalist’, as a management consultant so as to boost the sales of a particular technology or a product rather than that of an expert in telecommunication.” (para 25)
6. Scientific advisors under Rule 103. “A perusal of Rule 103 of the Patents Rules, 2003 would show that before a person is qualified to be claimed as a scientific advisor, he must fall in all the three categories” (para 26) “I am of the view that a Scientific Advisor is nothing but essentially an expert in his own field in terms of Section 45 of the Evidence Act, 1872. If Mr. Regis J. Bates cannot be termed to be a Scientific Advisor on the parameters of Rule 103 of the Patent Rules, prima facie he can certainly not be called ‘an expert’, as is sought to be done by the plaintiffs. Therefore, I cannot accept his affidavit as an affidavit of an expert to hold that the plaintiffs have been able to make a prima facie case of the defendants infringing their patent.” (paras 26–27)
7. Factors in the balance of convenience. “In the instant case, for example, the balance of convenience to be established by the plaintiffs would entail examination as to whether it is marketing the patented product in the Indian market, whether it has approached the court with clean hands without concealment of material facts and whether there has been any delay in approaching the court, etc.” (para 28)
8. Working pleaded only in the rejoinder. The Court found “considerable force in the contention of Mr. Sethi” (para 33), who had cited Franz Xaver Huemer v New Yash Engineers (para 31), and held: “It was incumbent on them to have at least made averment in the plaint as to how and to what extent they were exploiting their patented technology.” “This should have been averred in the plaint itself rather than in rejoinder because latter is not a part of the pleadings. A party cannot be permitted to raise an argument which is not even pleaded. Rejoinder is an opportunity given to the plaintiffs for explanation, refutation, implication and not to set up a new case.” (paras 33–34)
9. The assignor’s and licensees’ silence. “If there is no complaint made by the licensee to the original patentee and similarly, no action was brought by the original patentee before assignment to the plaintiffs, it becomes an important fact which cannot be ignored. This becomes a triable issue as to whether the technology of the plaintiffs is being infringed or not by defendant Nos.3 and 4 and at this point of time, the court cannot assume that the technology of the plaintiffs is being infringed. Therefore, this also tilts the balance of convenience in favour of the defendants rather than the plaintiffs.” (para 35)
10. Irreparable loss. “An irreparable loss is a loss which cannot be compensated in terms of money. Conversely meaning a loss which can be calculable in terms of money or for which money can be adequately compensated, can never be said to be an irreparable loss.” (para 36)
11. Sections 48 and 108. “the patentee has a right to get an injunction but that right is not an absolute right and a mandatory right.” (para 37) “A conjoint reading of the aforesaid two Sections would clearly show that though the patentee has prima facie a right to obtain an injunction but that injunction is not necessarily to be granted as a matter of course. It can be refused in case a party can adequately be compensated in terms of money or the court can sufficiently protect the interest of the plaintiffs by passing certain other directions.” (paras 37–38)
12. Procedure. Disposition and terms. “the injunction which has been granted in favour of the plaintiffs vide order dated 3.2.2014 ought not to be continued” ... “The conditions specified in the said order at serial No.(iii) to (vii) shall be mutatis mutandis applicable to the facts of the present case as well.” (para 42) “Expression of any opinion may not be treated as an expression on the merits of the case.” (paras 42, 45)
13. Procedure. A panel of scientific advisors. “In addition to this, I feel that this is a fit case where a panel of three scientists should examine the two technologies” ... “I, therefore, feel that a letter needs to be addressed to the heads of IIT Delhi, Delhi College of Engineering and Netaji Subhash Chander Bose to suggest the name of one Professor or Associate or Assistant Professor meeting the qualification of Rule 103 of the Patent Rules, who shall form a panel of three Scientific Advisors or experts, who would examine the two technologies and submit a report to the court for its consideration.” (para 44)

What the court did not decide

“These were delay in filing the suit for infringement, alleged concealment by the plaintiffs in filing the suit, inadequate payment of stamp duty on the assignment document, suit being barred by Order II Rule 2 CPC, etc.” ... “Since I have already formed a view on the basis of three basic parameters with regard to grant or non-grant of injunction, I feel that it is not necessary that the court should embark on deciding these points also which have been urged before this court. Accordingly, the said points are not dealt with.” (para 43)

Subsequent treatment

• Appealed — A Division Bench of the Delhi High Court is reported to have declined, on 13 August 2014, to interfere with this order; the appellate order has not been traced.