Exceptions to the Burden of Proof

This instant work is an outcome of a doubt which arose in my mind when for the first time I read section 104A of The patents Act, 1970 which talks about ‘burden of proof in case of suits concerning infringement ’. This section was added through an amendment in 2002. It might also be said that it was in furtherance of the objective of TRIPS agreement which have a similar provision under article 34. I will be mentioning the provisions in the latter part of this endeavour.

As it is a well known fact in common parlance and as well in the legal world that one who asserts has to prove it through cogent evidence. However, as everything has its exception/s, this aspect of burden of proof is also prone to the same. The Evidence Act, 1872 deals with the general provisions with regard to burden of proof [1] . Also specific provisions regarding the same are incorporated in the specific legislations as and when required. So, based upon that section 104A is the incorporation of some of the provisions of Evidence Act, 1872. [2]

I will be dealing with this specific section in detail in the next part of this work. So in order to get an answer to my doubt I moved towards the judicial take on this very section and other writings on this very aspect. As judicial pronouncements may not be the final word in the academic aura but has the binding value for that point of time and it is the law of the land. The doubt was an outcome of the limitation of language, my comprehensive limitations and also the way section 104A is written in the official gazette. It gives an impression that the proviso to the section is applicable only to clause (b) of section 104A (1). However, after my research on the point I can say that it’s applicable throughout the section.

It is said that patent right is a very strong right but it does not seem to be so. Infact, we take a perusal of the provisions of the Patent Act, it can be easily demarcated that it’s a very weak right and is subjected to various limitations. [3] As we know that human made laws and rules are a product of various reasons viz., experience, necessity, and justice, to promote certainty in the system, establish a proper, fair and equitable order, and improve the conditions of living and so on so forth. It is not possible to put everything in the written text because of the inherent limitation of the language and also the person doing so. Thereby the need to understand the underlying meaning of any text arises. The text has to be understood in its context.

“A statute must be read in the text and context thereof. The construction of statute will depend on the purport and object for which the same had been used.” [4]

Not only making the law but its proper, genuine, efficient and effective implementation is required. So is the case with these kinds of legislations which deals with the protection of intellectual property rights. In a catena of case our judiciary has reiterated this point. In the case of Dalco Engineering Private Ltd. v  Shree Satish Prabhakar Padhye and Ors. [5] , the SC held that,

“Interpretation must depend on the text and the context. They are the bases of interpretation. One may well say is the text is the texture; context is what gives the colour. Neither can be ignored. Both are important. The interpretation is best which makes the textual interpretation match the contextual. A statute is best interpreted when we know why it was enacted. With this knowledge, the statute must be read, first as a whole and then section by section, clause by clause, phrase by phrase and word by word. If a statute is looked at, in the context of its enactment, with the glasses of the statute-maker, provided by such context, its scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover what each section, each clause, each phrase and each word is meant and designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. Statutes have to be construed so that every word has a place and everything is in its place”.

As it’s a well known fact that intellectual property rights are now widely known and because of their nature they need special treatment. Keeping myself limited to my work in the next part of this work I will be dealing with what does infringement means and related concepts. As we know that our Patent Act does not specifically define ‘infringement’.

INTRODUCTION

If we have a close perusal of the various provisions incorporated under the Patents Act, we may say that patent right is regulated by various conditions. It is indeed an exclusive right granted to the patentee [6] but is subject to limitations as envisaged under the Act. Now, a right can be infringed only when it exists. Infringement as such has not been defined under the Patent Act but has been mentioned under various sections. [7] On can gather the meaning of infringement from the scope of the monopoly rights conferred on the patentee, for infringement is the violation of those rights.

Now, this issue of shifting of burden of proof and in what conditions it will be applicable comes into play only when a suit for infringement is filed in a competent court [8] . That’s why it becomes important to understand what actually infringement consists of and also because some of the acts have been exempted from being an act of infringement. [9] Similarly, we already have envisaged the other limitations on the rights of the patentee and connected person thereto. We will be discussing in brief about them during this work. Also judicial approach has been dealt in herewith.

In the process of clearing my doubt I also enriched myself on various other aspects of patent law and hence have included them in brief in the instant project. Also briefly I have discussed the concept of infringement in USA and Japan Patent law system.

Now to highlight my doubt it would be desirable to come with the text of the section. I am directly pasting the incorporated section as given in the gazette of India. [10] In order to clearly put the respective section without any ambiguity it seemed to me the appropriate way to directly take this section from the most authentic source.

Now we look at this provision it seems as if the provision enshrined is applicable only to clause b, atleast it seemed so to me. But after my readings and understanding I can say that its equally applicable throughout the section.

Also, this section provides for in the case of process patent and product by process patent and does not talk about product patent. It may be because of two reasons:

1. the ambit of process patent is wider i.e., the claims provided in the specifications may have a wider language. Also the area of applicability of doctrine of equivalence is more. In case of product patent it is very narrow and on the face of it. The product is available simultaneously to

2. there was no such product patent regime in India. It came after 2005 amendment.

These two reasons may attribute to such a language of the section. Similarly, now I would like to put forth the similar provision in the TRIPS agreement which related to burden of proof.

PROVISIONS IN TRIPS AGREEMENT [11]

Article 34 – Process Patents: Burden of Proof

1. For the purposes of civil proceedings in respect of the infringement of the rights of the owner referred to in paragraph 1(b) of Article 28 [12] , if the subject matter of a patent is a process for obtaining a product, the judicial authorities shall have the authority to order the defendant to prove that the process to obtain an identical product is different from the patented process. Therefore, Members shall provide, in at least one of the following circumstances, that any identical product when produced without the consent of the patent owner shall, in the absence of proof to the contrary, be deemed to have been obtained by the patented process:

(a) if the product obtained by the patented process is new;

(b) if there is a substantial likelihood that the identical product was made by the process and the owner of the patent has been unable through reasonable efforts to determine the process actually used.

2. Any Member shall be free to provide that the burden of proof indicated in paragraph 1 shall be on the alleged infringer only if the condition referred to in subparagraph (a) is fulfilled or only if the condition referred to in subparagraph (b) is fulfilled.

3. In the adduction of proof to the contrary, the legitimate interests of defendants in protecting their manufacturing and business secrets shall be taken into account.

Thus, we can easily see the similarity between the two provisions.

Now I will be dealing with the related concepts.

KINDS OF PATENT

The Patent Act, 1970 envisages broadly 3 kinds of patent

1. Product patent

2. Process patent

3. Product by process patent or hybrid patent

The language of the specification decides it all and it varies with the nature of the respective patent. The claims form the essential part of the specification on which the rights are based and i.e., why claims are said to be the metes and bounds of the patent right.

Now when most patent claims can be characterized as process, apparatus, or composition of matter claims, a so called product-by-process claim bestrides the usual categories. As the name suggests, a product-by-process claim, describes a product made by a specific process. Traditionally, product-by-process claims have been used when the invention is best described in terms of how it is made rather than what it is. [13] It can be better understood through illustration. Think, how an omelet could be described to someone who had never seen one. One might attempt to describe an omelet in physical or chemical terms, but a better approach would be to provide the recipe. At one time product-by-process claims were allowed only when the invention could not be described except through the “recipe”- for example, when the precise physical characteristics of the product could not be determined. Now they are allowed even if they are not strictly necessary.

As has been envisaged by Alan L.Durham in his book, Patent Law Essentials [14] ,

There has been much debate about the role to be given the process in interpreting a product-by-process claim. In Scripps Clinic & Research Foundation v. Genetech, Inc., [15] the Federal Circuit held that the process described in a product-by-process claim could be ignored when determining the scope and claim. In other words, if the claim recited the product of process X, an identical product made by a different process would still infringe. [16] According to this way of thinking, the process recited in a product-by-process claim is provided only as a way to define the product. The subject mater of the claim is still the omelet, not the recipe. This interpretation of the law follows the practice of the patent office in determining if a product-by-process claim should issue. The patent office will not issue a product-by-process claim unless it finds that the product, not just the process, is something new. [17]

However, in Atlantic thermoplastics Co. v. Faytex Corp., [18] a different panel of Federal Circuit Judges rejected the earlier interpretation and held that the process set forth in a product-by-process claim does limit the claim, at least in litigation, so an identical product made by different process des not infringe. [19] According to this court, the Scripps Clinic rule was contrary to Supreme Court authority and the hornbook principle of patent law that all elements of a claim are essential in determining infringement. Although it acknowledges that different standards are applied in patent prosecution, the court noted that this discrepancy is not unique. For example, the patent office will give claims their “broadest reasonable interpretation,” whereas no such rule applies in litigation. [20] This is the position in USA.

A product patent claim would recite “such and such substance”. A related process patent claim would recite “a process for making such and such substance by performing steps (a) and (b)”. a corresponding product-by-process patent claim would simply rearrange words of the process claim to recite “such and such substance made by the process of performing steps (a) and (b)”. [21]

Now, as far as India is considered section 104A specifically talks about process patent and product by process patent and lays down two conditions in which the burden shifts on the defendant and that two it has to be beforehand established by the plaintiff that the product is identical to the product directly obtained by the patented process.

In the next part we will be dealing with the fact that where the suit for an infringement can be filed and the related requirements.

SUIT FOR INFRINGEMENT [22]

When any person infringes the rights of the patentee, a suit for infringement of patent should be instituted in the District Court having jurisdiction to try the suit.

A suit for infringement can be instituted only if the patent has been sealed. The patentee cannot institute a suit for infringement during the period between date of advertisement of acceptance of the complete specification and the date of sealing of patent. However, he can claim damages sustained due to infringement during the said period in a separate suit after sealing of patent.

A suit for infringement of a patent, whose term has expired, can be instituted for claiming damages if the infringement occurred during the term of patent.

In case the patent was wrongfully obtained by the patentee and was later granted to the true and first inventor, a suit for infringement occurring before the grant of patent cannot be instituted.

Where a patent had lapsed but was subsequently restored, the proceedings for infringement cannot be instituted against any infringement committed between the date on which the patent ceased to have effect and the date of advertisement of application for restoration.

The period of limitation for instituting a suit for infringement is 3 years from the date of infringement. However, it is not necessary to send a notice of infringement to the defendant before filing the suit for infringement. In the next part I will be dealing with the concept of determination of infringement. What are the known measures to establish that and infringement has taken place.

DETERMINATION OF INFRINGEMENT [23]

In deciding whether what the alleged infringer is doing amounts to an infringement of a particular patent three questions are involved, namely

1. the extent of monopoly right conferred by the patent which has to be ascertained by the construction of the specification;

2. whether the alleged acts amount to making, using, exercising, selling or distributing a product; or using or exercising a method or process in the case of a process patent; and

3. whether what the alleged infringer is doing amounts to an infringement of the monopoly conferred by the patent grant.

Now, the following acts will constitute an infringement of a patent right as granted under the act.

a. The colourable imitation of an invention;

b. Immaterial variation in the invention;

c. Mechanical equivalents;

d. Taking essential features of the invention.

The abovementioned acts often overlap each other when an infringement of a patent or process occurs.

A colorable variation or immaterial variation amounting to infringement is where an infringer makes slight modification in the process or product but in fact takes in substance the essential features of the patentee’s invention. Infringement by mechanical equivalents would occur when he uses mere substitutes for those features so as to get the same result for the same purpose as obtained by the patentee.

In the next part we will be dealing with the concept of onus of proof in infringement action. The burden of proof may shift in accordance with the requirement of law. The onus remains on the party one who asserts it.

ONUS OF PROOF IN INFRINGEMENT ACTION [24]

In a suit for infringement the burden of proving the infringement is on the plaintiff. [25] In an action for infringement of a patent where the invention relates to the production of a new substance, any substance of the same chemical composition and constitution, in the absence of proof to the contrary, will be presumed under Section 114 of the Indian Evidence Act, 1872, to have been produced by the patented process of which it is alleged to be an infringement. [26] This case was decided way back in 1969 and shows that even burden of proof shifts onto the shoulders of the defendant.

He/plaintiff must also prove that he is either the registered proprietor of the patent or the registered exclusive licensee. [27] A certified copy of the entry in the register obtained from the Controller under section 147 would be sufficient to prove title.

Where the defendant has challenged the validity of the patent or counterclaimed for revocation, the burden of proving the invalidity is on him. [28] Thus, when the defendant pleads that the patentee is not the true and first inventor, the burden of proof is on him only. [29] Similarly where prior user is alleged by the defendant to invalidate the patent and the evidence on the issue is conflicting and unsatisfactory; the onus of establishing prior user will fall on the defendant. [30]

With the amendment in 2002 a new provision has been incorporated which shifts the onus to the defendant. Under this section the court may direct the defendant to prove that the process used by him to obtain the product is identical to the product of the patented process if.

1. a. the subject-matter of the patent is a process for obtaining a new product,

b. there is a substantial likelihood that the identical product is made by the process, and the patentee or a person deriving title or interest in the patent from him, has been unable through reasonable efforts to determine the process actually used.

Provided that the patentee or a person deriving title or interest in the patent from him, first proves that the product is identical to the product directly obtained by the patented process.

2. In considering whether a party has discharged the burden imposed upon him by sub-section (1), the court shall not require him to disclose any manufacturing or commercial secrets, if it appears to the court that it would be unreasonable to do so.

Furthermore a case is not ordinarily decided on the burden of proof when the parties have entered into evidence but sometimes an exception is made having regard to the nature of the suit and particularly the plaintiff’s own ignorance about the essentials of the patent. [31]

Yet again, where the invention relates to the production of a new substance, any substance of the same chemical composition and constitution will, in the absence of evidence to contrary, be deemed to have been produced by the patented process of which it is alleged to be an infringement. Though the general burden of establishing a case of infringement rests on the plaintiff, the burden of proving a particular fact, namely, the process by which the defendant prepared the substance in question would be on the defendant since this is a fact especially within his knowledge. [32]

In an infringement action the main function of the Court is to construe the claims which are alleged to have been infringed, without reference to the body of the specification, and to refer to the body of the specification only if there is any ambiguity or difficulty in the construction of the claims in question. [33]

Thus, the obligation upon the defendants is not to establish the precise method of manufacture by which the alleged infringement was prepared; but to prove that the material has not been produced by the patented process. [34]

Thus, in the light of above discussion we see how the burden of proof shifts in the case of product by process patent by virtue of section 104A.

RELIEFS FOR THE PLAINTIFF/PATENTEE

Section 108 further talks about reliefs in suit for infringement. It has also been amended in the same year 2002. It stipulates that the reliefs which a court may grant in any suit for infringement include a injunction (subject to such terms, if any, as the Court thinks fit), thus making it discretionary in nature and there by provisions of Order 39 CPC will be applicable. It also provides the relief of either damages or accounts of profit that too at the option of the plaintiff. The infringing materials and implements which are in the predominant use of the production of the infringing goods can be seized, forfeited or destroyed, if the court thinks fit and it can be done even without payment of any compensation.

‘Accounts’ relates to the account of net profits earned by the defendant (infringer). If there are no profits, ‘accounts’ is not a remedy. Damages and Accounts are alternative remedies; the owner can chose only one of them, not both. Further by virtue of section 111, a restriction has been imposed on the power of the court to grant damages or account profit for infringement.

Hereby, if the defendant proves that at the date of the infringement he was not aware and had no reasonable grounds for believing that the patent existed. So, normally the burden of proof lies on the defendant. He needs to prove that he did not have any such knowledge.

I need not deal with other connected provisions as they might not be that relevant for the purposes of instant work, though it might have some connecting relevance.

However, in the next part I would like deal in brief the concepts of infringement in USA and Japan.

CONCEPT OF INFRINGEMENT IN USA & JAPAN [35]

Unlike India the infringement has been defined under the US law. Position in USA

Section 271 stipulates infringement of patent as; (a) Except as otherwise provided in this title, whoever without authority makes, uses or sells any patented invention, within the United States during the term of the patent therefore, infringes the patent.

The scope of the exclusive right which is necessary to determine infringement is defined by claims.

Section 261 of the Patent Act envisages the nature of the infringement as it states that patents shall have the attributes of personal property and infringement of a patent is considered to be essentially a tort since it is an invasion of a property right of the patentee. A patent must be a valid one in order to support a charge of infringement.

JAPAN

Surprisingly, in Japan as well infringement has not been specifically defined. But the concepts about the effects of patents, infringement or the scope of patent rights are similar to those in the United States. It provides that the patentee exclusively owns a right to use the patented invention in business. [36] The patentee can exclude others from making, using, selling, leasing, displaying for sale or lease, or importing the patented invention. Since the exclusive right concerns only use in business, use for the purpose of experiment or research does not constitute an infringement. There is no provision to define infringement in the Patent Law but infringement is considered to arise when a third person uses the patented invention in his business without any legal justification.

A patent right is referred to as an intangible property right and infringement of a patent is generally considered a tort.

Section 103 of the Patent Law presumes that whoever infringes another’s patent is negligent. Section 102(2) provides for a reasonable royalty as damages just like 35 U.S.C. 284.

Besides being characterized as a tort, infringement is sometimes characterized as unjust enrichment. Actual litigations were filed and remedies were given under the theory of unjust enrichment. Unjust enrichment is described in Section 703 [37] of the Civil Code.

If a patentee claims damages under the unjust enrichment theory, he cannot claim damages under the tort theory. Theoretically unjust enrichment is the only possible remedy when a defendant has proved not being negligent. The burden of proof of negligence is shifted to a defendant by the presumption of his negligence.

Therefore it is practically difficult for the defendant to prove the non-existence of negligence and in most cases negligence is not argued. A patentee, therefore, can usually rely on either the tort theory or the unjust enrichment theory. The practically important difference of a tort and unjust enrichment would be in the provisions of a statute of limitations. A patentee may proceed under whichever of them is favorable in a given case.

No damages for a tort shall be recovered by the patentee after three years from the notice of the damages and the existence of the tort-feasor, or after twenty years after the negligent act whichever expires first. [38]

On the other hand no recovery shall be had for unjust enrichment that occurred more than ten years ago. [39]

Thus, we had a very brief idea about the concept and nature of infringement in USA and Japan. It will be useful in its comparison with the India patent law system. However, we do not have such a concrete/statutory concept of unjust enrichment and I think it would have been proper if such a provision has been there in Indian patent law as well.

Having an idea about the system in these two countries which are technologically very advanced and as the requirement of patent law is needed the most over there. We can peruse the law over there and accordingly meet the challenges over herein.

Now, in the foregoing section I will explain on the concept of burden of proof and infringement and the applicability of respective sections through excerpts from few relevant judicial pronouncements. As a matter of fact there are so many judgments on this aspect, but most of them are from the High Courts. Supreme Court is yet to come out on it. However, in respective High Court pronouncements various holdings of Supreme Court have been enumerated, though we do not have a direct authority of Supreme Court as per my limited research.

JUDICIAL APPROACH

FDC Limited and Ors. v. Sanjeev Khandelwal and Ors. [40]

This Civil Revision Petitions are filed by the defendants against the fair and decretal order dated 26.3.2007 made in I.A. No. 141 of 2007 in O.S. No. 70 of 2007 by the learned Principal District Judge, Thiruvallur, granting ex parte ad-interim injunction, pending disposal of the suit, restraining the defendants from in any manner infringing the plaintiffs/respondents Patent No: 197822. The learned District Judge, Thiruvallur, granted ex parte ad interim injunction for a period of one month. Aggrieved of the said order of the trial court, the revision petitioners/defendants have preferred these revisions under Article 227 of the Constitution o