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Petitioner: Messrs Getz Pharma (Pvt.) Limited and others VS Respondent: Novartis AG and others
Court Name: Sindh High Court Judge(s): Muhammad Faisal Kamal Alam Title: Messrs Getz Pharma (Pvt.) Limited and others vs Novartis AG and others Case No.:Judicial Miscellaneous No.08 of 2021 along with Miscellaneous Appeals
JUDGMENT
Reported As: 2022 CLD 61 Result: Order accordingly Judgment JUDGMENT MUHAMMAD FAISAL KAMAL ALAM, J.---Through the present Petition, Petitioner/Applicant has challenged the Sealing Order dated 12.11.2018 of Respondent No.2 (Controller of Patents) in respect of Patent No.142090 (Subject Patent) given in favour of Respondent No.1. The product in respect of which the patent is granted is "DUAL-ACTING COMPOUND COMPRISING AN ANGIOTENSIN RECEPT OR ANTAGONIST AND AN NEP INHIBIT OR", which is a lifesaving drug. 2. The ad-interim restraining order was granted on 05.03.2021 while hearing the Injunction Application-C.M.A. No.4205 of 2021 (of present Applicant) where after, Ms. Amna Salman Ahmed, learned counsel representing Respondent No.1 also filed an Application-C.M.A. No.4875 of 2021, under Order 39, Rule 4 of C.P.C., for vacation/recalling of above Order . 3. Ms. Amna Salman Ahmed, Advocate has argued both C.M.As. It is contended that after a long drawn out procedure, impugned Sealing Order in favour of Respondent No.1 was granted by Respondent No.2. It is further contended that the Opposition(s) filed by present Applicant/Petitioner and the Appe llants of title connected Appeals were dismissed after proper hearing and due process; that since patent was granted in favour of Respondent No.1 and it was continuously infringed by Applicant and other entities, thus, compelling the present Respondent No.1 to file an infringement suit (Suit No.134/IPT of 2019) before the Intellectual Property Tribunal at Lahore in which injunction was confirmed, but it was challenged by present Applicant in F.A.O. No.12220 of 2021 [1st Appeal against order] before the learned Lahore High Court, wherein stay has been granted. The present J.M. has been filed after a long delay of more than two years from the date of granting of Sealing Order dated 12.11.2018. No restraining order has been granted in any of the proceedings including above Appeals in favour of either present Applicant or other Pharmaceutical Companies, which could prevent present Resp ondent No.1 from enforcing its
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right in respect of Subject Patent and hence there was no justification for passing of restraining order on 05.03.2021, which has seriously prejudiced the interest of Respondent No.1 being a legitimate patentee. 4. Learned Advocate has referred to sections 7 and 46 of the Patents Law, inter alia, relating to grounds on which patent can be revoked; section 60 of the Patents Law has been referred to show that even in the above Suit filed by present Respondent No.1, Counter Claim can be filed by present Applicant seeking revocation of patent in question. She has referred to relevant record of present Lis, about the pending proceeding at Lahore. It is argued that section 27 of the Patents Law is not applicable to the present case, as invoked and interpreted by the Applicant/Petitioner , because the said section 27 also relates to patent of addition, whereas the subject patent of Respondent No.1 is not a patent of addition but the original patent and the provisions relied upon by the legal team of Applicant with regard to grant of autom atic stay once the notice of proceeding is received by the Controller of Patents-Respondent No.2, is a misconceived argument. Contended that under section 47 of the Patents Law, Revocation could have been filed before the Controller but within a prescribed period of 12 months and since no revocation was filed within such period, which is a limitation period mentioned in the said law (Patents Law), hence the present proceeding is preferred under section 46 of the Patents Law, which although does not specify a limitation, but filing of subject proceeding (Judicial Miscellaneous) after a delay of more than two years, shows the mala fide of the Applicant. 5. Mr. Faisal Siddiqui, Advocate representing the Applicant has made submissions. He contends that present proceeding has been filed because Respondent No.1 opposed the amendments in Miscellaneous Appeal No.68 of 2018 in which present Applicant wanted to make amendments to the extent of challenging the subject impugned Sealing Order . He controverted the arguments of learned counsel for Respondent No.1, that section 27 of the Patents Law is not applicable to the present case. Learned Advocate has relied upon the Explanation to the above provision, wherein the term "proceeding" means "time for any appeal has not expired". He has questioned the patentability of subject Patent by placing reliance on sections 7 and 27 of the Patents Law and states that since drugs in question are lifesaving drugs, coupled with the fact that no novelty and invention is involved, hence, Respondent No.2 should not have issued impugned Sealing Order , particularly , when the number of Miscellaneous Appeals are sub judice , of which he (Respondent No.2) has due notice. 6. Learned Advocate for Applicant has referred to record of the Case, to show that how the process of Patents started, by referring to page-89 (of the Court File), which is an application under section 14 of the Patents Law (dated 07.11.2006), inter alia, for grant of Patent. He has referred to 11 (eleven) objections raised by the Examiner (of the Patent Office) (at page- 629), which were replied to by Respondent No.1 vide their Missive of 14.04.2014, that is, after 06 years and Opposition on behalf of present Applicant (at page-663), dated 21.08.2015. It is contended that the process become lengthy for purported grant of the impugned Patent was due to the fact that Respondent No.1 itself was guilty of not complying the requisite formalities. 7. Arguments heard and record perused. 8. The impugned Sealing Order dated 12.11.2048 is at page-1 125 (Annexure-M-7) with the main Petition, issued by Respondent No.2, inter alia, declared the Respondent No.1 as Patentee in respect of subject Patent for the term of 20 years, effective from 09.11.2005, which means for another four years, subject to the provision of the Patents Law. 9. One of the grounds (ground "G") of the main Petition is that certain intricate questions about patentability of the alleged invention were involved and expert evidence should have been record ed, which was not done. This averment of the Applicant itself justifies that the question of patentability inclusive of novelty and ancillary issues relating thereto should be left to be decided in the main Petition as well as tagged Miscellaneous Appeals and not at this interlocutory stage. 10. Since both interlocutory applications are to be decided, therefore, only necessary facts and case law will be considered and discussed. Since interpretation of section 27 is involved, thus it is reproduced herein under- "27. Grant and sealing of patent. ---(1) Subject to the provisions of this Ordinance with respect to opposition and to any power of the Controller to refuse the grant, a patent sealed with the seal of the Patent Office shall, if the
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request is made within the time allowed under this section, be granted to the applic ant or applicants within that time or as soon as may be thereafter , and the date on which the patent is sealed shall be entered in the Register . (2) Subject to the provisions of this Ordinance with respect to patents of addition, a request under this section for the sealing of a patent shall be made not later than the expiration of six months from the date of the publication of the complete specification: Provided that (a) where at the expiration of the said six months any proceedings in relation to the application for the patent is pending in any court or before the Controller , the request may be made within three months after the final determination of that proceeding; and (b) where the applicant or one of the applicants has died before the expiration of the time within which under the provisions of this subsection the request could otherwise be made, the said request may be made at any time within twelve months after the date of the death or at such later time as the Controller may allow . Explanation .---Any proceedings shall be deemed to be pending so long as the time for any appeal therein has not expired, and any proceedings shall be deemed to be finally determined when the time for any appeal therein has expired without the appeal being brought." 11. Both learned Advocates for Applicant /Petitioner and Respondent No.1 have submitted their respective Written Arguments. The legal team of Applicant/Petitioner has submitted a 'Brief Skeleton of only the main arguments on behalf of the Applicant on C.M.A. No.4205 of 2021 and C.M.A. No.4875 of 2021' , comprising of two volumes, containing relevant provisions of statutes, viz. the repealed the Patents and Designs Act, 1911, Section 64 of the Patents Act, 1970 (India) and section 72, of the Patents Act, 1977 (United Kingdom), so also the case law. The case law cited by learned Advocates for Applicant and Respondents are mentioned in the opening part of this Decision. 12. Gist of the arguments of Applicant's counsel in support of which case law has been cited is, that section 27(2) (a) of the Patents Law is to be given a wider meaning because it contains the words "subject to the provisions of this Ordinance with respect to Patents of addition" , have to be read with section 39 of the said Patents Law, and period of six months as mentioned in section 27(2) will not override the time period in the aforementioned section 39(4) as far as the main Patent is concerned. Since section 46(1) of the Patents Law provides grounds for revocation of Patents, hence the grounds for revocation are not only limited to those mentioned in sections 7, 8 to 10 but will also include section 27 (of the Patents Law) and if it is found that any mandatory provisions of the Patents Law or the PR 2003 are violated, then it justifies revocation of the subject Patent. In particular , sections 16 and 21 read with Rules 14 and 42 (of Patents Law and PR 2003, respectively) have been violated while passing the impugned Sealing Order , hence, it has to be set aside; that the present proceeding has also involved sections 54 and 56 of the Patents Law, relating to powers of this Court for making rectification in the Register of Patents; Patents relating to lifesaving drugs cannot be granted, as is the present case, because the purported patented drug of Respondent No.1 is used for treatment of cardiovascular diseases and Respondent No.1 is and would exploit the Patent to the detriment of public interest. Non filing of reply / Counter Affidavit by Respondent No.2-the Controller of Patents, is the admission of averments as pleaded in the main Petition, and consequently relief as claimed be allowed, inter alia, and the subject Patent be revoked. Under section 61(2)(c) of the Patents Law, Court can direct the patentee to provide a sufficient security in a suit for infringement filed by the patentee under section 60 and the same provision is not applicab le to present Applicant, which has not filed the Suit but it has been filed by present Respondent No.1 at Lahore (as mentioned above), hence the latter be called upon to furnish sufficient security . 13. The arguments of Applicant's counse l with regard to the fact that process involved in Subject Patent is known since 1990, as mentioned under the captioned Argument No.5 , cannot be considered at this interlocutory stage, as it requires a deeper probe. Similarly , the reported decisions about rectification of register under section 56 and power and authority of Respondent No.2 is similar to the one mentioned in section 152 of the erstwhile Companies Ordinance 1984 (relating to the rectification of register), are not relevant for deciding the present interlocutory applications.
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14. Crux of the case law relied upon by Counsel of the Applicant is as follows-- In the NAP case (ibid) the Hon'ble Supreme Court has interpreted the phrase 'subject to the provisions of subsection (2)' of the then Political Parties Act, 1962, inter alia, stating that when such a phrase is used in the statute, it means that the first provision is conditional upon the performance of what is required by the provision referred to; such a phraseology is used to make a provision conditional upon / dependent upon other provision(s). The argument of learned counsel of Applicant, from this case law is, that section 27 of the Patents Law cannot be read in isolation only for the "Patent of addition", but other provisions of the Patents Law pertaining to the grant of a patent generally , will also be applicable here, in particular , a restraint on the power of Respondent No.2 as mentioned in proviso (a) for not passing the order if a proceeding is pending to the subsection (1) of section 27. In the Pfizer case (supra) , learned Division Bench of this Court has vacated the ad-interim orders operating in favour of Pfizer , which filed a suit again st respondents (of the reported case) for infringement of patent. It was observed on the basis of record that Pfizer is exploiting the monopoly in respect of its patent and selling the medicine, which was used for treatment of high blood pressure, at an exorbitant price and much higher than the other defendants. It was also observed that Pfizer was selling the same medicine in neighbouring country on a lesser price. With these background facts , it was held that neither balance of convenience lies in favour of Pfizer nor the latter will suffer irreparable loss in case of refusal of injunction. Defendants (of the reported case) were directed to maintain account and submit a monthly statement; whereas, the application of defendants seeking suspension of the patent (of Pfizer) was declined by the learned Bench, on the ground that the prescribed period of patent was already coming to an end (at the relevant time) coupled with the fact that factual controversy raised by the parties could not be resolved without recording of evidence. In Cipla case (ibid), the learned Delhi High Court refused the injunction in favour of plaintif f, because it was of the view that in such type of cases, ingredien ts of balance of convenience and irreparable loss are equally important, besides, prime facie case. Since both plaintif f and defendant (of the reported decision) were manufacturing drugs for patients suffering from lung cancer , it was held that the public interest shou ld be given more importance. However , while refusing injunction to plaintif f, defendant was also put to terms , inter alia, to pay damages if the suit of plaintif f is decreed. Injunction was refused to plaintif f in Tajuddin case , because registered design in respect of bronze coffee pots was registered ex-parte, under the erstwhile the Patents and Designs Act, 1911. This reported Decision is distinguishable from the present case, as admittedly , no ex-parte proceeding is done while passing the impugned Sealing Order of 12.1 1.2018. In Glaxo case , it is held, that if it is found that a monop oly is being exploited or such privilege, as arises upon the sealing of patent, is being mis-used in disregard of public interest then such equitable relief of injunction can be refused. Consequently , the order of ad-interim injunction was recalled, requiring the defendant to furnish his monthly accounts. In Earth factor case (ibid) , this Court while exercising Appellate jurisdiction in a patent appeal, allowed the same and the impugned order granting patent in favour of respondent 3 was set aside. Court dilated upon the term 'invention' and "novelty" as mentioned in section 7 of the Patents Law, and held, inter alia, that since technology regarding dual number SIM, was already in use in different countries, hence patent was wrongly granted in favour of respondent No.3. This judgment is not relevant at this interlocutory stage, because, issue of patentability can only be decided after a thorough security of record in the connected Miscellaneous Appeals and the present main Lis. The two reported decisions of learned Lahore High Court relating to non-filing of Counter Affidavit and filing of Written Statement, averments whereof are evasive and does not dispute a claim in a specific manner as required under the relevant provisions of Civil Procedure Code, entailing adverse consequences, that is, the pleadings of a plaintif f/petitioner is deemed to be admitted, is a settled rule and does not require further elaboration in this Order . However , these two decisions do not lend any support to the case of present Applicant/ Petitioner , because the latter's claim has been disputed by the Respondent No.1 in its Counter Affidavit, besides, preferring, subsequently ,
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another application (under Order XXXIX, Rule 4 of C.P.C.) for vacation/recalling of the ad interim order dated 05.03.2021, operating in favour of present Applicant. 15. Prcis of the case law relied upon by the legal team of Respondent No.1 is as follows- Hilton Pharma case (supra) ; this Court while disagreeing with the contention of defendant's counsel, about prior knowledge, use and lack of novelty of plaintif f's patents, granted the injunction for enforcement of the patent. It is held, that defendant in the same proceeding can also take grounds for revocation of a patent, but till such controversy is decided by some compete nt forum, the presumption of its [patent] validity and exclusive right of use the patented product will subsist in favour of plaintif f. In Smith Kline Beecham case (supra), this Court was of the view that where it is shown that plaintif f has incurred heavy investment upon the invention, process of manufacturing and its market ing, then, factors of balance of convenience and irreparable loss lies in favour of plaintif f and justifies grant of injunctive relief. In Ferozsons case, Court granted the temporary injunction and disagreed with the argument that grant of injunction against defendant would operate against public interest as the price of plaintif f's drug is exorbitant as compared to the price at which the defendants are selling their drug, by ruling, that it is not a relevant consideration. The decision of Hilton pharma (2017 CLD 557 -- Sindh) handed down in appeal against the dismissal of opposition, has been relied upon by Respondent 1, to substantiate the contention that after grant of Patent, an inventor enjoys the monopoly; "having made the disclosure to the public, which disclosure goes into public domain and people at large are free to use this information, except to reproduce the product or to use the process for commercial gains or in any manner violating the scheme envisaged by the patent laws". Similarly well-known decision given in the Tabaq case (supra) by the Hon'ble Supreme Court is relied upon to fortify the argument that once a trademark, copyright or patent is registered then the basic ingredients for grant of ad-interim injunction, that is, prima facie case, balance of inconvenience and likelihood of an irreparable injury weighs in favour of the holder of the intellectual property; which in the present case is Respondent No.1 . In the Tabaq case , besides discussing the concept of "passing of', learned Supreme Court upheld the decision of learned District Judge, granting the injunction to the holder of Trademark of Tabaq case , while setting aside the order passed by the learned Lahore High Court. In Getz Pharma case (coincidently of present Applicant/Petitioner), its suit was dismissed for revocation of the patent in favour of defendant. Learned Judge has explained the importance of intellectual property rights jurisprudence, inter alia, that granted patents "are incorporeal possessions having property rights granted under the doctrine of jus ad rem"; further ruled , "making the patentee a prima facie owner and beneficiary of all the rights arising therefrom and restricting public at large to use the patented method or invention.. . . .... ". While expounding Article 24 of the Constitution of Pakistan, it is held that the term "property" mentioned in the said Article extends to all forms of property , including intellectual property . In Ismail Zafar case (ibid), learned division Bench of this Court has ruled that mere filing of writ petition would not automatically stay the departmental proceeding, as there is no concept of an automatic stay, as contended by the appellant's counsel (of the reported decision). Decision of the apex Court handed down in Shafi Baloch case (supra), inter alia, reiterating the well settled rule about status quo, that it can be maintained between the parties in accordance with the situation as it obtains at the time of the institution of the suit and not to a point of time prior thereto. This decision is relied upon by counsel of present Respondent No.1, in support of her argument, that by virtue of the ad-interim order of 05.03.2021, an altogether new situation has been created, as the Respondent No.1, which is the patentee in respect of the aforesai d subject product, has been restrained to enjoy its statutory right arising out of and flowing from the Subject Patent, which violates the settled principle laid down in numerous decisions, including the afore referred case. The cited reported decisions, which explain the scope of Order XXXIX, Rule 4 of C.P.C. (relied upon by counsel of Respondent No.1), do not require detail discussion, crux of which is, that this provision can be invoked, seeking vacation of previous injunction order , when it is unduly harsh and or unworkable, or where the injunction order sought to be recalled is ex-parte .
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16. Learned Advocate for Respondent No.1 in response to a query put during proceeding has submitted a Statement dated 28.05.2001, as to how a public interest can be protected if a patentee, which is a multinational company abruptly discontinues its operation or production in Pakistan. Learned counsel in her above Statement has relied upon Rule 30 of the Drugs (Licensing Registering and Advertising) Rules, 1976, which prescribes certain conditions, inter alia, for maintaining a sufficient quantity of production of medicines to ensure its regular and adequate supply in the market; and the manufacturer of any drug shall not without the prior approval of the competent authority , can discontinue the production, which can cause shortage. 17. Adverting to the arguments addres sed on the section 27 of the Patents Law. Learned counsel for the Applicant/Petitioner has referred to the Bailif f's Report of, 19.10.2018 and Report/Receipt of TCS (courier service) dated 24.10.2018, to show that Respon dent No.2-Controller of Patents was duly served and he knew about pendency of Misc. Appeal proceedings in this Court, wherein, though no restraining order was granted, but in terms of the section 27, particularly proviso (a), since "proceeding" in the shape of Misc. Appeals were/are pending,, the impugned Sealing Order should not have been granted by Respondent No.2 to Respondent No.1, as the said section 27, envisages a restraint upon grant of Sealing Order when a proceeding is pending. 18. Section 27 of Patents Law is examined. This provision has two categories. The first category is subsection (1), which deals with power of the Respondent No.2-(Controller), in respect of Opposition filed by those, who are opposing the grant of Patent, inter alias as envisaged in section 23 (of the Patents Law); the Controller after hearing the parties, can decide the Opposition and either refuse the grant of Patent to an Applicant, or decline/dismiss the Opposition (Notices of Opposition) as mentioned in section 23 (ibid). In case, the Opposition is dismissed, as is done in the present Lis, it is followed by sealing of Patent and shall be entered in the Register , maintained in terms of the Patents Law and P .R Rules, 2003, which is impugned in the present proceeding. Since this subsection (1) does not mention the term "Patents of Addition", which is mentioned in subsection (2), therefore, this subsection (1) is for the patent granted (sealed) in respect of main invention . The word used in subsection (1)-"subject to the provision of this Ordinance..." (as strenuously emphasised by couns el for Applicant/ Petitioner) is to be read with regard to the power and authority of Respondent No.2, concerning Opposition, refusal or grant of patent in respect of the main invention, as mentioned in the Patents. Law (the Patents Ordinance, 2000 ). No express provision of the Patents Law has put a restraint (bar) on the power of Respondent No.2, to refuse or stay the grant of patent (Sealing of Patent) in respect of main invention , merely because some other proceeding is sub judice…
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