Case Note & Summary
The petitioner, Euro-apex B.V., entered into a licence agreement with Shinhan Apex Corporation in 1993, authorizing the latter to manufacture and sell the petitioner's products in South Korea. The relationship deteriorated, and the petitioner terminated the agreement in 2008, with a post-termination confidentiality period of five years. In July 2008, Shinhan Apex Corporation filed a patent application in Korea for the technology, and subsequently in India in October 2008, claiming priority from the Korean application. The petitioner alleged breach of confidentiality and approached the Netherlands Arbitration Institute, which on 23rd December 2011 passed a partial final award holding that Shinhan Apex Corporation had breached confidentiality and directed it to transfer its rights in the Indian patent application to the petitioner. The petitioner filed a request for change of applicant before the Controller of Patents and Designs on 19th January 2012, withdrew its pre-grant opposition on 2nd February 2012, and Shinhan Apex Corporation executed a Deed of Assignment on 4th April 2012. The petitioner also filed Form-8 on 1st March 2018 naming Mr. Dinulescu as the inventor, replacing the earlier inventor Mr. Mun-Jae Cho. The Controller issued a First Examination Report on 13th July 2018, to which the petitioner responded. Hearings were held on 18th September 2020 and 1st January 2021, and the petitioner filed written submissions along with the Deed of Assignment. On 13th July 2021, the Controller passed the impugned order refusing the patent application on three grounds: change of inventor without no objection certificate from the old inventor, non-compliance with Section 20(1) and Rule 34(1) regarding assignment, and characterization as a case of wrongful obtaining under Section 25(1)(a). The petitioner challenged the order before the Bombay High Court. The High Court found the order cryptic and noted that the Controller failed to consider the partial final award and the Deed of Assignment. The objections regarding change of inventor and assignment were not raised in the FER and were not put to the petitioner during hearing. The Court held that the Controller's order was unsustainable and set it aside, remanding the matter for fresh consideration on merits, directing the Controller to pass a reasoned order after giving the petitioner an opportunity of hearing.
Headnote
A) Patent Law - Refusal of Patent Application - Section 15, Patents Act, 1970 - Controller's Order - The Controller refused the patent application on three grounds: change of inventor without consent of old inventor, non-filing of assignment under Section 20(1) and Rule 34(1), and characterization as wrongful obtaining under Section 25(1)(a). The High Court held that the order was cryptic and failed to consider the partial final award of the Netherlands Arbitration Institute directing transfer of rights and the Deed of Assignment executed pursuant thereto. The objections regarding change of inventor and assignment were not raised in the First Examination Report and were not put to the petitioner during hearing, violating principles of natural justice. The Court set aside the impugned order and remanded the matter for fresh consideration on merits. (Paras 7-10, 13-14) B) Patent Law - Pre-grant Opposition - Withdrawal of Opposition - Section 25(1), Patents Act, 1970 - The Controller argued that pre-grant opposition cannot be withdrawn. The High Court noted that the petitioner had withdrawn its opposition after the arbitral award, and the respondent had accepted such withdrawal in other cases. The Court held that a party is entitled to withdraw a pre-grant opposition, and the Controller's stand was unjustified. (Para 11) C) Patent Law - Assignment of Patent Rights - Section 20(1), Rule 34(1), Patents Act, 1970 - The Controller opined that the assignment was not filed. However, the Deed of Assignment dated 4th April 2012 was placed on record with written submissions. The High Court held that the Controller erred in ignoring this document and that the assignment, coupled with the arbitral award, sufficiently established the petitioner's right to the patent application. (Paras 6, 10, 13)
Issue of Consideration
Whether the Controller of Patents and Designs was justified in refusing the patent application on grounds of change of inventor without no objection certificate, alleged non-compliance with Section 20(1) and Rule 34(1) regarding assignment, and characterization as wrongful obtaining under Section 25(1)(a), without properly considering the partial final award of the Netherlands Arbitration Institute and the Deed of Assignment.
Final Decision
The High Court allowed the petition, set aside the impugned order dated 13th July 2021, and remanded the matter to the Controller of Patents and Designs for fresh consideration on merits, after giving the petitioner an opportunity of hearing and passing a reasoned order.
Law Points
- Patent application refusal must be based on proper appreciation of evidence
- Arbitral award directing transfer of rights is binding
- Deed of assignment is sufficient to establish applicant's right
- Objections not raised in examination report cannot be basis for refusal
- Pre-grant opposition can be withdrawn
- Change of inventor without consent of old inventor is permissible when based on arbitral award finding breach of confidentiality.
