Delhi High Court Reverses Patent Rejection And Emphasizes Substantive Review Over Procedural Compliance

Introduction

In a recent decision, the Delhi High Court delivered a judgment in the case of Star Scientific Limited v. The Controller of Patents and Designs.[1] The case centered on Star Scientific Limited’s appeal against the Controller’s decision to reject their patent application solely due to the company’s absence at a hearing. The Court ruled in favor of Star Scientific Limited. The judgment emphasizes that a procedural lapse like missing a hearing should not be the sole cause for patent rejection. The Court directed the Controller to re-evaluate the application based on its merits and issue a well-reasoned decision.

Brief Facts

Patent Application

• The Appellant filed National Phase Patent Application No. 202017011947 for “Composition, Methods, and Apparatuses for Catalytic Combustion.”
• The application related to the catalytic combustion of clean fuel mixtures.

Patent Application Process

• Request for examination filed on 25^th June 2021, thereafter the first examination report (FER) was issued on 23^rd August 2021.
• The Appellant further filed a detailed response to FER on 23^rd February 2022, amending claims from 1-53 to 1-22.

Hearing and Non-Attendance

• A hearing notice was issued and 8^th December 202 was set for the hearing date.
• The Appellant’s counsel did not attend due to a lack of instructions.
• The Appellant informed the Controller of financial difficulties and requested disposal on 15^th and 18^th December 2023.

Rejection of Patent Application and Appeal

• The controller issued an impugned order on 18^th December 2023, refusing the patent application.
• The Appellant sent multiple emails and a representation to revive the patent application in March 2024.
• No response was received, leading to the present appeal.

Arguments of the Parties

Appellant’s Submissions

• The Appellant filed a detailed reply to the First Examination Report (FER) on 23rd February 2023 addressing all objections raised.
• The controller was obligated to pass a reasoned order considering the Appellant’s submissions under Section 14 of the Patents Act and Rule 28(5) of the Patent Rules, 2003.
• Non-attendance of the hearing does not constitute abandonment of the application. The Appellant communicated financial difficulties and requested disposal.
• The Appellant missed relevant emails due to inadvertence and server upgradation, leading to the Patent Attorney’s non-attendance.
• Patent grants in nine other countries support the grant of the patent in India.
• Amended claims were submitted to address the Controller’s objections, warranting a decision on merit through a reasoned order.
• The Appellant was entitled to file written submissions within fifteen days under Rule 28 of the Patent Rules, but the Controller passed the order within ten days.

Respondent’s Submissions

• The appeal is misconceived as the impugned order was passed per the Patent Act and Rules.
• The Appellant approached the court with unclean hands by making contradictory statements about financial difficulties and inadvertence/server upgradation.
• The Appellant failed to explain the actual reason for non-attendance at the hearing and did not provide proof of financial difficulties.
• Appellant’s claim of financial difficulties is false and misleading considering its status as a leading Hydrogen Research and Development Company with patent grants in various countries.
• The Appellant did not provide proof of server upgradation.
• The Appellant’s reply to the FER contained substantial amendments, making it insufficient without addressing objections to the hearing notice.
• Communications from the Appellant’s Patent Attorney on 15th and 18th December 2023 indicate a conscious decision to abandon the application.

The Court’s Decision

Court’s Decision

• The impugned order rejecting the application is set aside.
• The matter is remanded back to the Controller for fresh consideration.

Reasons for the Decision

• Non-attendance at Hearing does not Justify Rejection: Simply not attending a hearing does not warrant application rejection under Section 15 of the Patents Act (1970). The Controller failed to consider the Appellant’s detailed reply to the First Examination Report (FER).
• Lack of Speaking Order: The Controller’s order lacked reasoning. It did not analyze the objections raised in the FER or the Appellant’s response. A speaking order considering the Appellant’s reply to the FER was required under Section 11 of the Patents Act.
• Abandonment Not Established: The Appellant’s request for disposal through emails does not constitute abandonment. Abandonment requires a conscious decision to withdraw the application, which was not evident here.

Precedents Cited

• Ferid Allani v. Union of India & Others (Para 12): Abandonment requires a conscious act by the applicant, not a presumption.[2]
• Telefonaktiebolaget Lm Ericsson (Publ) v. Union of India & Others (Para 13-18): Application abandonment occurs only when the applicant fails to address objections or request an extension. The Appellant in this case had already filed a reply to the FER.[3]
• Merck Serono S.A. v. Union of India & Others (Para 14): An application is deemed abandoned only when the applicant fails to pursue it. Here, the Appellant provided explanations for objections raised in the FER and SER.[4]
• FMC Corporation v. The Controller of Patents (Para 17): Even if written submissions are not filed on time, the Controller must consider objections, replies, and oral submissions during the hearing, and pass a reasoned order. Here, the impugned order lacked reasoning despite a detailed reply by the Appellant.[5]
• Otsuka Pharmaceutical Co. Ltd. v. Controller of Patents (Para 18): The inventive step acknowledged in corresponding applications of other countries should be considered while determining patentability. The Controller failed to consider this aspect.[6]
• Huhtamaki Oyj and Another v. Controller of Patents (Para 21): Every order rejecting a patent application or accepting/rejecting opposition must be reasoned and speaking, addressing each objection systematically.[7]

Directions to the Controller

• The Controller must reconsider the application.
• The Appellant can file written submissions within five days of this judgment.
• The Controller can decide at their discretion whether to grant the Appellant another hearing.
• The Controller must decide the matter on merits within four months.

Analysis and Conclusion

The Court’s decision to set aside the Controller’s order and remand the case for reconsideration is well-founded. The Controller’s decision to reject the patent application solely based on the Appellant’s non-attendance at the hearing is a procedural overreach. The core issue lies in the Controller’s failure to conduct a substantive examination of the application and provide a reasoned decision based on the merits of the case.

The Court correctly emphasized the importance of a speaking order that addresses the Appellant’s arguments and evidence. By requiring the Controller to reconsider the application, the Court ensures a fair and just evaluation of the patent application based on its merits, rather than on procedural defaults.

[1] Star Scientific Limited v. The Controller of Patents and Designs, (C.A.(COMM.IPD-PAT) 20/2024).

[2] Ferid Allani v. Union of India & Others, 2008 SCC Online Del 1756.

[3] Telefonaktiebolaget Lm Ericsson (Publ) v. Union of India & Others, 2010 SCC OnLine Del 1086.

[4] Merck Serono S.A. v. Union of India & Others, 2014 SCC OnLine Del 1825.

[5] FMC Corporation v. The Controller of Patents, CA(COMM. IPD-PAT) 482/2022.

[6] Otsuka Pharmaceutical Co. Ltd. v. Controller of Patents, 2022 SCC OnLine Del 4982.

[7] Huhtamaki Oyj and Another v. Controller of Patents, 2023 SCC OnLine Del 3272.