Bombay HC: Remake Zanjeer to be released

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The remake ‘Zanjeer’ is set to be released on 6th September, as the Bombay High Court refused to grant an injunction against its release (here). We have tracked the development of this case here, here, here, here and here. 

To briefly recap, the Plaintiffs Salim Khan and Javed Akhtar had alleged copyright infringement of the script they had written for the original ‘Zanjeer’ produced by Prakash Mehra in 1973. They prayed for a permanent order of injunction restraining Sumeet Mehra and others (heirs of Prakash Mehra, the Defendants in this case) from in any manner exhibiting, releasing, displaying, communicating to the public anywhere in the world the remake film “Zanjeer” in Hindi and Telugu languages or any other language. 

The Plaintiffs contended that they were the authors of the script of the original Zanjeer. According to them, this literary work was never commissioned by Prakash Mehra and it was in existence even before Prakash Mehra had approached the Plaintiffs for the same. Moreover, Prakash Mehra was granted a one time permission to make the said film in 1973. Therefore, Prakash Mehra’s rights were restricted only to the cinematographic film “Zanjeer” made in the year 1973 and did not extend to the underlying “literary work” since there was no authorization from the Plaintiffs to this effect. All the rights including the right to remake a cinematographic film based on the literary work, in any language in the absence of any assignment under Sections 18 and 19 of the Copyright Act continues to remain with the Plaintiffs and no remake film can be made based on the said literary work by the Defendants, without the written consent of the Plaintiffs. 

However, the Court came to the conclusion that Prakash Mehra had commissioned the work from the Plaintiffs for a consideration of Rs. 55, 000 each and was therefore the first owner of the underlying works of the film which included the literary work. The turning point of the case was the following sequence of events: (i) Plaintiff No.1 narrated the “ story idea” of “Zanjeer” to Dharmendra; (ii) Dharmendra paid valuable consideration for that story, although it will be a matter of evidence whether the payment was to purchase the story (as stated by Plaintiff No.1 in his interview to ETC network) or as token blessing money as alleged in the rejoinder of Plaintiff No. 1; (iii) Dharmendra narrated the story to Prakash Mehra and asked him to take a script from the Plaintiffs based on the said story; and (iv) Dharmendra then commissioned the Plaintiffs to write a script on behalf of Prakash Mehra based on the said story. 

Several interviews of Prakash Mehra and Salim Khan were examined and the court found clear statements that showed that the script had been bought by Dharmendra and later by Prakash Mehra from Salim Khan and it was not a case of mere licensing. The assessment order of the relevant year along with the profit and loss account and the breakup of the costs of the movie were also produced where it was shown that Rs. 55,000 was paid to each author as a consideration for ‘script and screenplay’. The court disregarded a letter written by Dharmendra that the Plaintiffs produced to prove that the script was not bought because the letter was produced at a very belated stage. 

The Plaintiffs had also contended that they had licensed the “remake rights” of the literary work in respect of all South Indian languages, in favour of Mr. S.V.S. Manian. The Plaintiffs produced an affidavit of the wife of Shri S.V.S. Manian dated 31st December, 2012, confirming that her husband had bought the story rights in the Hindi film “Zanjeer” from the Plaintiffs for a period of 25 years for the making of the Tamil film “Sirithu Vazha Vendum”. But no written license was produced. The court disregarded the affidavit and left its authenticity to be checked at the stage of cross examination. 

On the basis of these facts and based on the decision in the IPRS case, the court came to a prima facie conclusion that it is the producer i.e. Prakash Mehra who became the first owner of the copyright in the underlying work (the script) and therefore had a right to remake the same (this right now vests with his heirs (the Defendants). Moreover, the court found that the Plaintiffs had unduly delayed in bringing the case to court. They were closely associated with the Film Industry and therefore could not take the plea that they were not aware that the Defendants were in the process of remaking Zanjeer, which was widely publicized. 

Also, since the Plaintiffs had quantified their claims in monetary terms at Rs. 6 crores, the court found that they were not entitled to a mandatory injunction. This was because even if the Court would have come to the conclusion that the Plaintiffs are the owners of the copyright since the Plaintiffs’ claim falls within the provisions of Section 38 (3) (c) and not under Section 38 (3) (b) of the Specific Relief Act,1963, their claims would be satisfied by payment of monetary compensation and not by an injunction.

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Delhi High court grants ex-parte injunction order against Aprica Pharma

On 17th June, in a patent infringement suit initiated by Merck, the Delhi High Court passed an ex parte injunction order, preventing Aprica pharmaceuticals from launching generic versions of Januvia and Janumet. The high court order can be accessed here.

Merck’s counsel argued that the drug (sitagliptin) has been patented in over 102 countries. Merck’s counsels also contended that the invention entailed huge investment and the sales of the medicine in India alone exceeded several crores and in case the defendants (Aprica) are able to launch their product, irreparable loss and injury would be caused to them.

Justice Sanjeev Sachdeva opined “The plaintiff has established a prima facie case on merits and I am of the view that in case ex parte injunction is not granted to the plaintiff and defendant is able to launch the product, irreparable loss and injury would be caused to the plaintiff, which cannot be compensated in terms of money. Balance of convenience is in favour of the plaintiff.”

Vague order?

The order employs standard language and does not seem to address the general principles issued by Supreme Court in such cases. (Not that I am complaining about the outcome itself!). Prashant, in his previous posts has discussed the general principles laid down by the Supreme Court precedents.Although not explicitly stated in the order, the fact that the patent had been granted in other major jurisdictions worldwide seemed to have worked in Merck’s favour.

The order does not discuss the patent claims and there was no finding of infringement of any specific product. The order restrains the defendant from dealing with any product that infringes subject matter of the patent (talk about vague!).Also what’s more, there is no reference to the previous order where the court refused to grant interim relief to Merck, for the very same drug. Readers may recall that we had covered the previous order denying interim relief to Merck over here.

What was different in the previous order? Well, Glenmark argued that their product comprises three components (sitagliptin, a dihydrogenphosphate and a crystalline form). Glenmark also argued that Merck had filed separate patents for sitagliptin, a dihydrogenphosphate salt form considering the salt form to be a new invention worthy of a separate patent. The patent to the dihydrogenphosphate salt form was abandoned. Merck failed to satisfactorily plead the circumstances for obtaining a separate patent application and the court denied interim relief to Merck.

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Mad rush for sitagliptin? 

As Prashant points out, The Form 27 working statement filed by Merck for the year 2012, reveals that the sales of Januvia and Janumet put together exceeds 180 crore (whopping amount)! The sales of its closest rivals Novartis’s (Vildagliptin) i.e. Galvus and Galvus-met is around 165 crores for the year 2012!!

Also,the health ministry in India recently banned pioglitazone belonging to the thiazolidinedione class of anti-diabetic drugs because of reports of increased risk of bladder cancer associated with its use. Another anti-diabetic drug Rosiglitazone belonging to the thiazolidinedione class was banned a few years ago following reports of the drug causing cardiac problems. So apart from metformin and sulphonylureas, the only alternative left for Type-II diabetics amongst oral hypoglycemic drugs are gliptin class of molecules. No wonder everybody seems to want to have a piece of the sitagliptin pie!

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The salt form jinx:Delhi HC denies interim relief to Merck

The Delhi HC (Justice Rajiv Sahai Endlaw) refused to grant interim relief to Merck (plaintiff) seeking to restrain Glenmark (defendant) from launching its products Zita and Zita met. We had blogged about it here and here. The High court however kept the main petition of the US firm pending for evidence filing and other legal proceedings on July 16.The order passed on Friday can be accessed here.Following is summary of arguments presented by either side. (Long post warning!) 

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On the issue of separate patents for Sitagliptin and salt form of Sitagliptin: 

Glenmark’s arguments:

Senior counsel for the defendant alleged that plaintiffs are guilty of suppression and had failed to disclose that the patent application (probably referring to the 5948/DELNP/2005) for the product for which injunction was sought was not only declined and also abandoned. 

Glenmark’s counsel elaborated that its product comprises of three parts “S”, “PD” and “DC” (possibly referring to Sitagliptin, dihydrogenphosphate salt and crystalline form), and that Merck has separate patents for each of these parts in USA. Glenmark’s counsel further detailed that Merck holds the patent in India only for the first part and separate patents for the other two parts i.e. phosphate salt and crystalline form were denied and affirmatively abandoned. 

Glenmark’s counsel also argued that Merck in its patent application (5948/DELNP/2005) had described that the combination of S and PD i.e. (Sitagliptin and phosphate salt) as a new discovery not covered by existing Sitagliptin patent. In light of this Merck cannot allege that defendants combination of “Sitagliptin and phosphate salt” infringes Merck’s patent. Glenmark also stated that “plaintiffs patent is for Sitagliptin Hydrochloride only and not for Sitagliptin Phosphate.” Placing reliance on Paras 139 and 156 of the Supreme Court Novartis judgement, it was contended that “coverage in a patent cannot be permitted to go much beyond the disclosure made by the patentee” 

It was also argued that if Sitagliptin phosphate and Sitagliptin weren’t distinct products, then Merck wouldn’t have applied for separate patents for each of those in US and India. 

Merck’s arguments:

It was argued that Sitagliptin was the invention and Sitagliptin phosphate was merely a derivative and therefore wasn't eligible for patent protection under Section 3(d).The separate patent application for Sitagliptin phosphate filed by Merck was due to some misconception, which is why they affirmatively abandoned the same. It was also stated that, separate patent for Sitagliptin phosphate was applied for since the US has no Section 3(d) equivalent patent law. 

On the issue of Infringement 

Glenmark’s arguments:

Analogy was drawn to the Roche vs. Cipla (2012) judgement in which the plaintiff sought to injunct the product version for which the patent application was rejected. On the basis of Roche vs. Cipla judgement it was argued that when the role of the variant (in this particular case Sitagliptin phosphate) outweighs the patented claim (Sitagliptin only), there can be no infringement. Shamnad’s posts on Roche vs. Cipla judgement are available here and here. 

Merck’s arguments:

Merck’s counsel argued that the package insert information reveals that the pharmaceutical composition of plaintiff’s product is similar to composition of Glenmark’s product Zita and hence the infringement is obvious. Merck’s counsels also emphasized that “there is no price difference in the product of the plaintiffs and defendant” to allay the influence of Novartis supreme court decision. 

On the presence of other infringers in the market 

Glenmark’s arguments:

Glenmark’s counsel also stated that since there are other (about 8-10) infringers in the market selling the same product for which injunction is sought, the ingredients of irreparable injury and balance of convenience are not in favour of the plaintiffs. 

It was also argued that grant of patent does not automatically create any presumptive validity (section 10 and 13(4) of Indian patent act) and since there are others in the market using the same formulation for which injunction was sought “there was no new invention.” 

Merck’s arguments:

The response of the plaintiff to the plea of the defendant that at least 9 to 10 other persons were also marketing Sitagliptin Phosphate was that instructions on that aspect will have to be taken once duly supported documents were handed over. 

DECISION :Observations of the Court 

Whether Glenmark’s product using a combination of Sitagliptin with its phosphate salt will have a material effect upon the working of Sitagliptin per se? 

The learned judge agreed that Merck’s granted patent includes within its ambit “pharmaceutically acceptable salt of Sitagliptin” which may of course include Sitagliptin phosphate (Glenmark’s product). 

The judge also reasoned that plaintiff should have shown that, defendant’s product inspite of combining phosphate salt with plaintiff’s patented Sitagliptin remained equivalent to Sitagliptin and that the role of phosphate was inconsequential in treatment of the disease. 

The judge also noted that Merck has had made a separate patent application for Phosphate salt form of Sitagliptin, considering it to be a new invention worthy of a separate patent. Plaintiff (Merck) has not satisfactorily pleaded the circumstances for obtaining a separate patent application. 

Justice Endlaw also elaborated that the defendant had also pointed out that there were at least 9-10 infringers marketing Sitagliptin phosphate. “Though, ordinarily infringement by others does not constitute a ground for denial of the relief of injunction against an infringer but it can be a consideration in the grant of interim injunction.” 

“I therefore do not find the plaintiffs to have made out a case for grant of interim relief” 

Conclusion: 

I may be oversimplifying things here, but claim 15 of Merck’s granted patent on Sitagliptin IN209816 clearly states “The compound as claimed in claim 1 (referring to markush structure of gliptins) selected from the group consisting of <structure of sitagliptin> or a pharmaceutically acceptable salt thereof.” 

Also the specification of the patent defines salt forms as “When the compound of the present invention is basic, salts may be prepared from pharmaceutical acceptable non-toxic acids, including inorganic and organic acids. Such acids include acetic, benzenesulfonic, benzoic, camphorsuifonic, citric, clhanesulfonic, fumaric, gluconic, glutamic, hydrobromic, hydrochloric, isclhionic, lactic, maleic, malic, mandclic, methanesulfonic, mucic, nitric, pamoic, pantothenic, phosphoric, succinic, sulfuric, tartaric, p-toluenesulfonic acid, and the like. Particularly preferred are citric, hydrobromic, hydrochloric, maleic, phosphoric, sulfuric, fumaric, and tartaric acids.” 

So,wouldn’t it be reasonable to conclude that anyone who markets the disclosed salt forms of Sitagliptin infringes the patent claims? So how does it matter that Merck tried and failed to patent the salt form separately in another patent in India. Hope our readers can help me out here!

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Ericsson sues Micromax over SEPs in 100-crore Patent Suit: Delhi High Court awards Interim Deposit

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In a move that is surely going to open a hornet’s nest soon in the future, Ericsson, the Swedish giant in mobile network infrastructure manufacturing, has recently filed a patent infringement suit against Micromax, one of India’s largest domestic mobile handset manufacturers (producing approximately 5.5% of the 200 million mobile handsets sold annually in India). The suit, filed at the Delhi High Court, involves a huge claim of Rs. 100 crores made by Ericsson by way of damages, which makes it perhaps the foremost in rank in terms of damages sought in a patent suit in the Indian IT and Telecommunications sector.

According to Ericsson, this legal action on its part was inevitable after more than three years’ negotiation with Micromax refused to yield a solution in the form of a license agreement on certain standard-essential patents (SEP) relating to wireless technology standards such as GSM, EDGE and 3G. The Micromax handsets and tablets using the disputed technology include models from its popular series like Ninja, Canvas 2 and Funbook Talk.

The dispute in itself is of considerable significance because of the subject-matter under consideration and the fact that it marks Ericsson’s entry into the Indian patent litigation scenario through the latest in a series of SEP litigations filed by it across the world against other players like Samsung and Acer. However, what makes it even more noteworthy is that the Delhi High Court, in the form of an interim order by Justice Manmohan, has issued an order to Micromax to deposit a certain amount of money, apparently in a bid to protect Ericsson’s monetary interests while the negotiations are continuing. The deposit prescribed consists of category-specific royalties, such as 1.25% of the sale price for phones/devices capable of GSM, 1.75% of sale price for phones/devices capable of GPRS + GSM, 2% of sale price for phones/devices capable of EDGE + GPRS + GSM and for WCDMA/HSPA [UMTS] phones/devices, calling tablets and finally, USD 2.50 for Dongles and data cards.

At a first glance, the royalties prescribed appear to be considerably high in amount. More than using any determining yardstick of its own by way of evaluating FRAND terms, the court seems to have given such an order solely based on Ericsson’s claims. The court has also permitted officials from Ericsson to work with customs officers in the inspection of Micromax's consignments to check for devices infringing Ericsson’s patents. The deposit is to be made by Micromax if it wishes to keep importing and selling its products and avoid getting them impounded by the customs department as its current consignment has been after Ericsson had alleged patent violation.  

Micromax has been quick to reject all the allegations by Ericsson and made the counter-allegation of non-compliance by the latter of its previous global commitments on providing its SEP to handset makers under fair, reasonable and non-discriminatory (FRAND) terms. Claims have also been made that Ericsson, following its exit from the handset market after termination of its JV with Sony, was seeking to extort unrealistic amount of licensing fees, as is evident from its ongoing battles with not only Micromax, but also other players like Samsung.  

In case the court decides in Ericsson’s favour, the impact of the decision is likely to undermine the low-cost business strategy of several domestic handset and tablet companies, as well as open a floodgate of litigation in the Indian telecommunications sector in the days to come. This possibility gains further currency by reports of Ericsson evaluating feasibility of similar legal action against a few other local low-cost handset manufacturers like Lava, Spice, Karbonn and Intex Technologies.

Interestingly enough, the US Department of Justice and the USPTO have in the beginning of this year issued a joined statement on SEPs, encouraging voluntary technology licensing on FRAND terms and discouraging injunctions or exclusionary orders that block infringing products from the market. One can argue that the impounding of Micromax’s consignment on the basis of Ericsson’s allegation in the present case amounts to exactly an injunction that the US government spoke out against. The dangers of a trend of granting ex-parte injunction in patent infringement suits have especially been highlighted time and again in this blog (see here and here). Even the high amount of deposit that Micromax needs to pay to continue its business is likely to attract considerable criticism, given the context.

There have been several SEP battles all across the globe till date, including those between Apple and Samsung or between HTC and Nokia, but the present dispute differs from them in the matter that one of the parties is not technically the owner of technology, which makes it difficult for that party to countersue Ericsson.

The Spicy IP team hopes to keep the readers informed as various facets of this drama unravels before the Delhi High Court in the days to come.

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'Mad Men' controversy

The hugely popular and critically acclaimed TV series 'Mad Men' has faced a setback after its production company Lionsgate has been sued by Gita Hall May, a top 1950's model. The lawsuit has been filed by Ms. May in the Superior Court of the State of California for the county of Los Angeles. 

The main title sequence of the Mad Men series depicts the shadow of a businessman falling through Madison Avenue. The background uses advertisements, office buildings and other designs to set the series in the 1950- 1960's. One of the advertisements contain an image of a red haired woman, who, through her looks and by herself is clearly identifiable with this time frame. This red haired woman was Gita Hall May and that particular image was a photograph taken by noted fashion photogapher Richard Avedon, to be used in a hairspray advertisement for Revlon. 

Ms. May has submitted before the Los Angeles Court in her complaint that she consented to the use of her likeness and the Avedon photograph only for the Revlon campaign then. To quote directly from the complaint, " At no time did she agree to allow, forty years later, her image to be cropped from the photo, in secret, and inserted as a key element in the title sequence of a cable television series, without her consent and for commercial purposes ." 

Ms. May's complaint is simple. She contends that she has a right to her likeness and that Lionsgate should not be allowed to exploit it without her consent, in an unauthorised manner while paying her no compensation whatsoever. It is extremely interesting to note that even this main title sequence of the Mad Men series has been acclaimed independently of the series as can be evidenced from the series's 2008 Emmy Award win for Outstanding Main Title Design. The complaint asserts that Ms. May's image in the main title sequence was integral to the success of the series and that Lionsgate has generated over one billion dollars through the exploitation of the series and its episodes. The complaint states that Ms. May's image in the main title sequence not only added commercial and economic value to the series but was also partly responsible for the value, success, goodwill, profits and reputation of Lionsgate and the other unidentified Defendants.

Therefore, Ms. May has approached the Los Angeles Court seeking remedy for the unauthorised use of her image and likeness by Lionsgate. The complaint lists eight causes of action which include the misappropriation of right of publicity for commercial purposes, invasion of common law rights of privacy; and violation of the unfair competition law, false advertising law, quasi contract and the principle of unjust enrichment among others. The complaint asks for several remedies including general, special, consequential, statutory and punitive damages; restitution; injunctive relief. ( The complete list can be found on pg: 13 of the complaint)

The decision of the Los Angeles Court on this matter is not yet out. In the meantime, readers can refer to this blog post for the image of Gita Hall May in the Revlon hairspray ad.

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Breaking News: Student Association Impleaded in Access to Education (DU Photocopy) Case

In a momentous development, the Delhi High Court permitted an association of students to intervene in a highly controversial law suit filed by leading publishers against Delhi University (DU) and its photocopier. 

Here is the link to the intervention petition filed on behalf of the "Association of Students for Equitable Access to Knowledge" by Jawahar Raja and Rajat Kumar, two Delhi based lawyers, who've been at the forefront of several legal battles to secure social justice. They were led by counsel Sanjay Parekh who forcefully presented the matter to the court.

For background to this law suit, you can read Lawrence Liangs' potent piece in Kafila and my editorial in the Indian Express. For a more entertaining rendition, you can watch this Youtube video featuring a catchy copyright jingle. 

The academic community, including students and faculty have been up in arms against this rather aggressive law suit which seeks to prohibit course packs altogether. Noted Nobel Laureate, Prof Amartya Sen expressed his distress at the law suit and decried this attempt to profiteer at the expense of students. So did Prof Kaushik Sunder Rajan. 

The publishers' naturally objected to the student intervention and argued that even if intervention is admitted, it should be limited to points of law. The judge however disagreed and held that the student association would be admitted as a full fledged party to the law suit, with the ability to file a written statement and lead evidence etc. 

For those interested in tracking this case that will test the bounds of educational exception and fair use under our copyright act, please see this link which contains all our previous posts on the issue.  To make it simpler, I'm outlining a brief trajectory of the unfortunate law suit and its unfolding:

i) Leading publishers sue Delhi University (DU) and its photocopier (Rameshwari) for copyright infringement in August 2012.

ii) An injunction allegedly restraining DU and the photocopier ensue in October 2012, owing to an unfortunate grammatical (mis) construct.

iii) Delhi University appeals the order in November 2012. The appellate court asks them to file a review petition before the single judge. However they opt to file an Order 39 Rule 4 application for vacating the restraining order. This application is now before Justice Rajiv Sahai Endlaw. Although the matter came up on Tuesday (26th Feb), it was not taken up by the judge. The matter is now posted for April 25th.

The student association has been given two weeks to file their written statement. As for the main documents pertaining to this case, see below:

i) The Plaint filed by leading publishers (OUP, CUP and Taylor & Francis)

ii) The Written Statement filed by DU

iii)  The Student Intervention Petition

Kudos to Jawahar Raja and Rajat Kumar (who took up the matter probono) and to the many students who toiled hard to secure the admission of this intervention. From this blog, Amlan Mohanty and Sai Vinod have been playing leading roles as law students at the forefront of this struggle to ensure equitable access to education. 

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BMS Hepatitis Patent Invalidated: A Viral Effect for India?

In a development with significant ramifications for India, a US district court recently invalidated a pharmaceutical patent covering Baraclude (Entecavir), a leading anti-viral drug for Hepatitis B patients. The drug brings in more than a billion dollars each year for BMS! 

The invalidation was pursuant to a law suit bought by BMS (the patentee) against Teva, a leading Israeli generic company. This drug is of particular interest to India, given a roaring patent contest on this front between BMS and Ranbaxy before the Delhi High Court. However, it bears noting that while the US patent (Number 5,206,244) covers the "parent" or "basic" Entecavir compound, the Indian patent only covers an alleged dosage "improvement". This is owing to the fact that Entecavir is a pre-TRIPS molecule and at the time of BMS's US patent application (in the year 2000), India did not grant pharma product patents.

As the Indian patent specification notes:

"This invention is directed to pharmaceutical compositions containing a low dose of entecavir and the use of such low dose composition to safely and effectively treat hepatitis B virus infection."

The Indian judge refused to grant an interim injunction  to BMS at the first instance, noting that the patent was “vulnerable”. The case has since been posted for "trial", and as I understand it, evidence is currently being recorded. For those interested, the Indian patent number is 213457 and the case details are: Bristol-Myers Squibb Company v. Ramesh Adige & Anr (Ranbaxy) C.S. (O.S) No. 534 of 2010.
 

As I’ve advocated here, in all cases where there is a strong challenge to the patent (which is in 90% of all pharmaceutical patent cases), courts must desist from granting injunctions. Rather, they must dispense with the interim phase and move straight to trial. In most pharmaceutical patent cases at least, this route will ensure that patients and generic manufacturers do not stand to suffer a "bad" patent in the "interim", a suffering that is well beyond "monetary" computation. 

"Working" of Entecavir:

It bears noting that we'd prominently featured Baraclude (Entecavir) in our Form 27 investigation some years ago, showing that "working" statements had not been filed in full for this drug. However, what we gathered is that the drug brought in more than 20 crores for BMS each year. We’ve not reviewed the recent statements by BMS, but assume that there has been better compliance on this front. As Sai Vinod noted recently, the Indian Patent Office (IPO) has again indicated that it is serious about compliance with working statements and Form 27. However, we need to re-examine the "efficacy" of the current format of the Form 27 statement.

For those interested, well known pharma blog, Pharmalot has a good review of the US invalidity decision, as also a link to the text. The decision is interesting for several reasons:  

1. This is not a classic ever-greening case and the drug compound (a carboxy nucleoside analog) is not a mere new form of a known compound. Rather, it is a new compound altogether and was approved by the FDA as an NCE (new chemical entity). To this extent, section 3(d) of the Indian Patents Act will not apply directly to this case.  

2. The US court applied a rigorous obviousness standard and held that although this may be a new compound, it fails the obviousness test since it was essentially an obvious modification of an existing natural compound. The two part analysis can be summarised as below:

i) it would have been obvious to a person skilled in the art to work with the closest known prior art compound (a naturally-occurring nucleoside commonly referred to as "2-CDG") with known anti viral properties.

ii) it would then been obvious to modify the existing compound (2-CDG) by substituting the oxygen atom with a carbon carbon double bond at the sugar portion. A skilled person would have a reasonable expectation that this modification would yield improved antiviral properties.

In other words, although the drug is based on a new compound, the said compound is not patentable, since it was obtained by modifying a known natural substance in a "stock in trade" manner.

The judgment which runs into 170 pages is a wonderful read, with a delightful interspersing of snippets of the cross examination. Sample this:

Tevas counsel: Now, you would agree that if you are looking for conservative changes that could be made, one place you would look at is the periodic table, is that right?
 

Dr Schneller (BMS’ key expert witness): Well, you almost have to, because all molecules are made from elements that are on that periodic table. So there no magic lamp someplace that’s going to come up with new ideas.

Tevas’ counsel: And the periodic table…it’s the chemists’ stock in trade?

Dr Schneller: Yes, sir

An "Alien" Patent Standard in India?

 

This decision helps dislodge the now prevalent presumption that the US almost always reflects “low” patent standards. As this case demonstrates (much like its earlier predecessor Pfizer vs Apotex), US courts do apply a rigororous patentability threshold from time to time. And to this extent, one might actually find that the ostensibly high Indian standards are actually not all that “alien”.

Of course, this is a district court decision and will certainly be appealed to the CAFC (Court of Appeals for the Federal Circuit), reputed to be more "patent friendly". 

One is not certain of the fate of the secondary patent in India. However, one might hazard a guess that, in the light of the "therapeutic efficacy" standard under section 3(d) that now informs most Indian decisions (unless the Supremes alter it in the much awaited Novartis Glivec ruling), BMS' claim to an improved "dosage" regimen is extremely vulnerable.

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Patent Ambush: Big Pharma vs Generics

The Economic Times (ET) reports that MNC drug firms have been deploying the RTI (Right to Information) route to launch aggressive patent ambushes against generic firms. 

I quote:

"Pharmaceutical multinationals have begun using the Right to Information law to launch pre-emptive legal action against local generic players to protect the market of patented drugs and delay the entry of low cost generic medicines in the 60,000-crore domestic drug market.

MNCs are using such information to sue generic firms even at a stage when their marketing approval is still pending or during the few months' window between the grant of approval and the actual product launch. This is a marked departure from their earlier strategy of launching patent infringement suit only after a generic firm rolled out a competing drug in the market."

Patent law suits are nothing new and quia timet actions are also prior art, so to speak. So nothing out of the ordinary here in using RTI information to sue, given that there is no other credible way to know if a generic manufacturer intends to launch a patented drug, than that of querying the DCGI (Drug Controller General of India) office and finding out.

Killing Promiscuous Injunctions?

 

But the mere factum of suing does not necessarily mean that big pharma is entitled to an injunction, much less an ex parte one. In a series of posts, Prashant, Rajeev and I reflect on the growing promiscuity of Indian courts in granting ex parte injunctions i.e. interim restraining orders that are passed without so much as hearing the other side.

Along with my students, I now plan to file a PIL (public interest litigation) soon requesting the Supreme Court to direct that no ex-parte restraining order be granted in any patent case, given that almost every patent case invariably involves a challenge to the very "validity" of the patent. How then can an order be passed without so much as hearing the other side? If any of you are interested in joining hands with us on this important fight, please email me.

Dispensing with Interim Injunctions

More controversially perhaps, I've advocated that Indian courts simply dispense with the "interim" phase and move directly to trial. The rationale is that the interim phase demands a "prima facie" evaluation of the merits of a dispute, which in a patent case,  can quickly convert to a rather lengthy evaluation, if one is serious about getting as close as possible to the right result. 

Any attempt to compress the prima facie evaluation phase is likely to yield wrong results i.e a patent found to be prima facie valid, ends up being struck down after trial, causing significant harm to generic competitors and more importantly to patients who are forced to contend with monopoly pricing till such time as the patent is finally knocked down!

My advocacy is not particularly fanciful, given that the Supremes have recommended something similar in at least two cases, given the extraordinary delays inherent in the so called "interim" phase. 

For those interested, an old paper of mine (presented at Kysuhu University) is available here (a significantly updated and revamped version of this paper will soon be published in a book edited by Professors Margo Bagley and Ruth Okediji).

Regulatory Opacity 

So back to the RTI route, which triggered the ET article. As I'd mentioned, its nothing out of the ordinary and one that we'd expect pharma patentees to deploy, given that our much maligned regulator (DCGI) is known more for its opacity and underhand dealings than its transparency. Don't take my word for it...read this scathing indictment by our Parliamentary committee which takes the DCGI to task for its unhealthy cosying up to both multinational and generic firms. 

Tellingly, as the report notes, most drug regulators begin their mission statement with an avowed objective of serving the public interest and ensuring the safety and efficacy of drugs. Our regulator on the other hand goes on record stating that its primary purpose is to "meet the demands and requirements of the pharmaceutical industry"! (see  pages 2-3 of the report: para 2.2). Great bedtime reading, and I'd recommend that at the very least, our readers subject this scathing report to a peek preview.

Back to the theme at hand. For those interested, I'd recommended that all drug marketing approval applications filed before the DCGI be published immediately on its website. Apart from making the DCGI more transparent and accountable, this would go a long way towards weeding unethical practices such as those deployed by Natco when it lied to the Delhi High Court and stated that it had no interest in the anti cancer drug Dasatinib, whilst at the same time having filed a drug application for a generic version of this drug before the DCGI. 

The Natco Defamation Suit

Had the DCGI been more transparent and uploaded all of its applications for drug approval, I'd have been spared the agony of a law suit. And the court might have been spared the agony of an unethical ride by a home grown pharmaceutical firm (Natco), that had just made news for its heroic efforts in standing upto a large multinational firm and procuring a monumental compulsory licensing order.

But then again, I'm glad they sued on such a weak case. Hopefully, we'll get an order that deters future corporate bullies from attempting to gag free speech (and dare I say, the truth)! For the record, I will continue writing and commenting on this case..all within the contours of the law of course and my constitutionally guaranteed freedom of speech. 

For those interested, my written statement countering Natco's non-sensical suit is here. This defence incorporates many of the arguments advanced by Prashant in his posts here and here.

ps: Each time I comment on a pharma patent issue, I get hit with the question: Which side are you on? I reiterate again that I'm not particularly fond of George Bush and his: "Either you're with us or you're against us" approach. 

I'd like to think that, as with the Novartis Supreme Court submission, I follow a strict issue based approach. While I come down on the side of the generics and/or patient groups on some issues, my conclusions end up favouring originator pharma companies on others. And once in a while, what I advocate ticks off both sides...perhaps a good place to be in for an academic, particularly one who advocates the middle path and holds the freedom of thought and expression very close to his heart..

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Guest Post: Court rejects Apple’s motion for Permanent Injunction against Samsung

The Apple - Samsung tussle is one that has now almost frequently found its way into our blog. It's being watched so closely due to its near symbolism of how patent wars may affect the landscape for technological innovation as we progress into an era where patent policy can directly affect more and more aspects of our lives. We are happy to present to our readers with a guest post on the latest US update on this international battle. Amshula Prakash, a 4th year student from NLSIU, has submitted this analytical piece as part of her application for our SpicyIP Fellowship. She ends with some interesting notes on how the Court may have failed to give certain aspects of patent law the importance they deserved. 

Court rejects Apple’s motion for Permanent Injunction against Samsung

Five days ago, the US District Court for the North District of California, San Jose Division, rejected Apple’s motion for a permanent injunction order against Samsung, following proof of patent infringement by the latter. The decision does not come as a big surprise, given the general trend followed by courts in the US post the epoch making decision in eBay v. MercExchange where the Supreme Court reversed the prevailing practice of granting a victorious patentee permanent injunction as a matter of right. The court held that patent law cannot be unique while dealing with permanent injunctions when an infringement has been proved and must go through the four factor test laid down in this case. In short, the case held that there is no presumption of the right to an injunction in a patent infringement case thus upturning the presumption that permanent injunctions are granted as matter of course in patent infringement cases.

In the Apple-Samsung case, the court considered Apple’s motion for permanent injunction in light of the four factors laid down in the eBay judgment, which requires the patentee to prove  i) Irreparable injury suffered by the patentee ii) Inadequacy of monetary damages to compensate for the injury iii) Considering the balance of hardships between the plaintiff and defendant, a remedy in equity needs to be warranted and iv) Public service would not be disserved by such an injunction

The highlights of the court’s reasoning in the determination of the four factor test are as follows.

Irreparable Injury not attributable to Samsung’s conduct- The court, stating that the presumption of irreparable injury no longer applies, even when infringement in proved, held that Apple has not made claims on a patent to patent basis but argued in terms of aggregate harm from patent and trade dress infringement and rejected the argument. Though the court agreed that Apple had suffered irreparable harm, the failure to attribute these to Samsung’s conduct decided this in Samsung’s favour.  

License evidence cuts in Samsung’s favour- Apple’s claim that monetary damages cannot make good the harm suffered was rejected by the court in light of Apple’s licensing activity. The court on its finding that Apple, in the past, has agreed to license its IP to competing companies such as Samsung held that this suggests the adequacy of monetary payments by Samsung.

Weighing the balance of hardships, the court held that neither Apple nor Samsung would be greatly affected by either outcome. The court rejected Apple’s argument that Samsung’s willful conduct tilted the scale in its favour by stating that injunctions are used to prevent further harm and not as punishment. Samsung’s counter that an injunction would create hardship by disrupting its relations with current consumers and carrier with pre-existing stock was also rejected by the court given the absence of an explanation by Samsung. The court thus held that the balance of hardship remained neutral.

The court decided on the harm that could be caused to the publicby looking at the public interest factor. This too was decided in Samsung’s favour as the court held Apple’s motion for injunction against 26 products to be ‘extremely broad’. The court while rejecting Samsung’s claims that an injunction would harm public interests by reducing competition for Apple held that it would not be equitable to deprive consumers of Samsung’s infringing phones as Apple’s IP was not core to the functionality of Samsung’s products. Additionally, the court also held that only a few features of the phones infringed Apple’s IP and doing so would deprive consumers of the non-infringing features in Samsung products.

The court thus decided that the equities were not in support of an injunction and rejected Apple’s motion. The question that comes to my mind is whether the standards determining equity in permanent injunctions in other areas of law such as tort and contract also be applicable to patent law? Patent law, by its very definition includes the right to exclude and it only makes sense to grant permanent injunctions as a matter of right to victorious patentees, including non-practising patent holders. Though the court pointed that a patentee’s right to exclude lies at the core of the grant of a patent, it is evident that this case, following the trend post the Ebaydecision, completely disregarded this crucial point and did so despite Samsung being a direct competitor of Apple. The court also explicitly states that absent an injunction, Samsung could begin again to sell infringing products further exposing Apple to harms such as loss of market share and downstream and future sales. Further, the court, despite mentioning the public interest factor involved in the granting of an injunction, by upholding the patent-holder’s rights and thus promoting risk based innovation, fails to give it the importance it deserves. Let’s hope the Federal Court give this aspect due consideration and uphold the very essence of patent law if Apple does decide to appeal.

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EBC granted injunction against Lexis Nexis for infringement of copyright

Last month we had blogged about the interim injunction granted in favour of Eastern Book Company (EBC) restraining Thomson Reuters (including Westlaw and Indlaw) from infringing the copyright in their law report Supreme Court Cases (SCC). In a further development, EBC has now been granted an interim injunction against LexisNexis India (including LexisIndia) and Butterworths by an order dated 22 September 2012 issued by the District Judge of Lucknow.  

As with the previous order the court held based on an illustration submitted by the Plaintiffs, that the editorial notes of law books, journals, online journals of the Plaintiffs publishing SCC exactly matched the editorial notes of the Defendants online journals. On this basis the court held that a prima facie case had been established and granted an injunction to the Plaintiffs.

22 October has been set as the date for filing the written statement and framing issues.  The entire order is available here and the previous order against Westlaw is available here.

We would like to thank Sumeet Malik for bringing this order to our attention.

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