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India – Intellectual Property Updates.

27 October, 2014


Legal News & Analysis – Asia Pacific – India – Intellectual Property 

 

  • Allied Blenders & Distillers Pvt. Ltd. (‘Allied Blenders’) is the registered proprietor of the trademark “Officer’s Choice”, which has been adopted and used by its predecessors-in-title since 1988. Officer’s Choice is also the highest selling brand of Allied Blenders and is considered one of the largest selling whiskies in India. In Allied Blenders & Distillers Pvt. Ltd. v. Shree Nath Heritage Liquor Pvt. Ltd.(CS (OS) 2589/2013.), Delhi HC by its order dated July 1, 2014, made the ex-parte ad-interim order dated December 19, 2013, granted in favor of Allied Blenders absolute, till the decision of the suit, and restrained the defendant, Shree Nath Heritage Liquor Pvt. Ltd. (‘Shree Nath’) from manufacturing, selling, exporting, importing, offering for sale, distribution, advertisement or dealing in alcoholic beverages, especially Indian-made foreign liquor bearing the trademark “Collector’s Choice”, or any other mark deceptively similar to Allied Blenders’ trademark “Officer’s Choice”.

 

One of the key arguments relied upon by Allied Blenders in this case was that the trademarks  “Officer’s Choice” and “Collector’s Choice” are deceptively similar as both of them convey the same idea. Allied Blenders argued that the term “collector” means and refers to the chief administrative and revenue officer of an Indian district, and therefore, the trademark “Collector’s Choice” conveyed that the whisky manufactured by Shree Nath is the choice of such officers.

 

Delhi HC, while upholding the contentions raised by Allied Blenders, held that the trademark “Collector’s Choice” was deceptively similar to the trademark “Officer’s Choice” as both the trademarks conveyed the same idea. Based on independent research on “consumer psychology” and “associative thinking”, Justice Endlaw, in this case, came to the conclusion that the consumer with an imperfect memory is likely to mix “officer” with “collector” and that the possibility of trademark “Officer’s Choice” of Allied Blenders being recalled as “Collector’s Choice” cannot be ruled out. Justice Endlaw also factored in the legal restriction by which advertising of alcoholic products is banned in India (and therefore, there is no scope of consumer brand recall).

 

Accordingly, it was held that it will be important to examine and evaluate the two rival trademarks not just on the basis of their visual and/or phonetic similarity, but also the idea or the message rival trademarks convey, and the impression that is left behind on the consumer.

 

  • In Bayer Corporation v. Union of India and Others1, the Bombay HC (‘Bombay HC’), by an order dated July 15, 2014, dismissed the challenge by Bayer Corporation (‘Bayer’) against the order of Intellectual Property Appellate Board (‘IPAB’) dated March 4, 2013. The order of the IPAB, in turn, upheld the order of the Controller General of Patents and Trade Marks (‘Controller’) dated March 9, 2012, granting a compulsory license (‘CL’) in favour of Natco Pharma Limited (‘Natco’) under Section 84(1) of the Patents Act, 1970 (‘Patents Act’), for manufacturing and selling Nexavar (‘Drug’) at a price of ¤ 8,800 per month of therapy, as against ¤ 284,000 per month of therapy being sold by Bayer. Bombay HC, while dismissing the challenge by Bayer, discussed, interpreted and threw light on the meaning and interpretation of the phrases (i) “reasonable requirements of the public been satisfied” under Section 84(1)(a) of the Patents Act; (ii) “reasonably affordable price” under Section 84(1)(b) of the Patents Act; and (iii) “worked in the territory of India” under Section 84(1)(c) of the Patents Act, which are discussed below.

 

i. Bombay HC, while accepting that the “reasonable requirement of the public” cannot be met on a mathematical basis, held this requirement was not satisfied as Bayer had sold only 593 boxes of the Drug, which was sufficient for only 200 patients out of 8,842 patients. Further, Bayer’s contention that the sale of the Drug by Cipla Limited (‘Cipla’) should be considered while calculating the total quantum of the Drug made available in India, was also not accepted as Bayer had already filed a patent infringement suit against Cipla in Delhi HC, and sought an injunction against them. Bombay HC held that the obligation to meet the reasonable requirement of the public is on the patent holder alone, either by itself or through its licensees.

 

ii. Bombay HC interpreted the words “adequate extent”, as occurring in Section 84(7)(a) (ii) of the Patents Act, and took the view that even though the adequate extent will vary depending on the type of patented product, in respect of medicine the adequate extent has to be 100%, and the medicine should be made available to each and every patient.

 

iii. Bombay HC, while clarifying that the Patents Act does not bestow any investigative powers on the Controller, held that the Controller can only ensure that patented article is available at a reasonably affordable price based on the relative price offered by a patentee and the applicant, and held that the Drug was not available at a “reasonably affordable price”, since Natco was offering the drug at INR 8,800 per month of therapy as opposed to Bayer’s price of INR 284k per month of therapy.

 

iv. In relation to the Bayer’s contention that it had already put in place a Patient Assistant Program (‘PAP’), under which needy patients (as recommended by doctors) were given free tablets of the Drug for one full month if they bought the Drug for three days’ use, Bombay HC held that under PAP, patented drugs were being made available only by recommendation and solely at Bayer’s discretion, and since the special price is not available in the ordinary course to every patient it cannot be taken into consideration while determining the “reasonably affordable price”.

 

v. On the most important issue regarding the “working of the patent” in India, Bombay HC observed that this phrase can be interpreted by reading Section 83 of the Patents Act2, which reflects the legislative intent for having such a provision. While Bombay HC agreed with the IPAB that whether a patent has been “worked in the territory of India” has to be looked at on a case to case basis, and that manufacturing in India is not the sole method of working a patent in India, it also held that the onus shouldalways be on the patent holder to satisfy the authorities under the Patents Act as to why the patented invention was not being manufactured in India keeping in view the objectives as laid down under Section 83 of the Patents Act.

 

End Notes:

 

1. Writ Petition No. 1323 of 2013.


2. Section 83 lays down the general principles applicable to working of patented inventions in India and states that a patent is not granted to enable the patentee to enjoy a monopoly for the importation of the patented article and that the technological knowledge must be transferred and disseminated to the mutual advantage of producers and users of technological knowledge.

 

AZB

 

For further information, please contact:

 

Zia Mody, AZB & Partners

zia.mody@azbpartners.com

 

Abhijit Joshi, AZB & Partners 

abhijit.joshi@azbpartners.com

 

Shuva Mandal, AZB & Partners 

shuva.mandal@azbpartners.com

 

Samir Gandhi, AZB & Partners

samir.gandhi@azbpartners.com

 

Percy Billimoria, AZB & Partners 

percy.billimoria@azbpartners.com

 

Aditya Bhat, AZB & Partners 

aditya.bhat@azbpartners.com

 

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