This content is from: India

Court curtails straw man patent oppositions in India

Shukadev Khuraijam and Ankush Verma of Remfry & Sagar discuss pre-grant straw man oppositions in India and the impact of a recent decision of the Bombay High Court

Section 25 of the Indian Patents Act 1970 provides for opposition to patent applications and patents granted under Indian law. 

Pre-grant-oppositions under Section 25(1) of the Indian Patents Act are unique as this form of opposition is not found in other jurisdictions. Such oppositions may be instituted by "any person" after publication of a patent application but before grant of a patent.

By contrast, Section 25(2) of the Patents Act only empowers "person(s) interested” to file a post-grant opposition within one year of the grant of a patent. 

Straw man oppositions

The distinction between the expressions “any person” and “person interested” is very important. The former expression permits a potential opponent to hide their true identity, thereby filing an opposition through a ‘straw man’.

Straw man oppositions may be filed for a number of reasons. One may be to avoid alerting a patent applicant to a potential action from a competitor. Additionally, a business partner, a supplier, or a licensee may wish to maintain an amicable relationship with the patent applicant and, therefore, may prefer to file an opposition by disguising their true identity.

Another reason could be from a strategy perspective: an opponent may not wish to disclose publicly available documents or arguments, thereby avoiding any issues pertaining to prosecution history estoppel that may arise at a later stage.

While straw man oppositions are certainly irksome to patent applicants, pre-grant oppositions do offer certain advantages. For instance, such oppositions can act as a filter to weed out non-meritorious applications that would not qualify for grant.

Recently, there has been a surge in the number of straw man oppositions filed against patent applications in India. An opposition invariably extends the time to grant, even if the outcome of the opposition is not favourable to the opponent. Although the pace of examination in India has increased significantly, a straw man opposition is likely to reduce the time a patentee may eventually have to enforce exclusivity in the market.

In the best possible scenario, even if the delay is for two years or less, that precious time is lost if the application survives and matures into a patent. The process may be further delayed if multiple oppositions are filed. Thus, straw man oppositions can be misused as a delaying tactic. 

Bombay High Court ruling

The question whether straw man oppositions are tenable or an abuse of the legal provision came to the fore in a recent case.

In a noteworthy decision (OA/2/2016/PT/MUM), the Intellectual Property Appellate Board (IPAB) condemned the filing of ‘Benami’ (an Urdu word for ‘without name’) oppositions. In this case, the pre-grant opposition pertaining to a pharmaceutical patent application had been filed by a person named Dhaval Diyora – a diamond merchant!

The opponent challenged the order of the IPAB before the Bombay High Court. The Bombay High Court endorsed the order of the IPAB and observed that prior to amendments to the Indian Patents Act in 2005, only the expression “person interested” was mentioned in the Act.

The intent of the legislature to widen the locus standi under the amended Section 25(1) was not to create an individual right as such but to provide access to “any person” to assist the Patent Office in making a correct decision. The legislature certainly did not confer this right to facilitate the abuse of pre-grant oppositions.

The court questioned how a businessman engaged in the diamond business supposedly had intricate knowledge of pharmaceutical compounds. The fact that he had filed multiple oppositions did not help his case. On the contrary, the court determined his behaviour to be “habitual” and held him to be a “habitual frontman” put up by those who intended only to delay the grant of patents.

As a deterrent measure, the court imposed costs on the businessman, thereby setting a new precedent for those seeking to engage in such behaviour.

Patent opponents should be aware of the implications of this case before utilising the pre-grant opposition mechanism in India against their competitor’s patent applications. 

A welcome precedent

So far, it has largely been the life sciences and agricultural sectors in India that have borne the brunt of straw man oppositions. However this trend is now being seen in other fields too.

While the Bombay High Court’s observation must also be seen in the light of a writ petitioner coming to the court with unclean hands, the key take-away is that patent opponents should establish proper credentials in filing such oppositions so that a court does not perceive the action to be an abuse of legal provisions. 

However, a loophole can still be exploited despite this ruling. A straw man opposition could be filed by a connected person in the relevant field – say a researcher in chemical sciences for a chemical invention – and a patent opponent could refrain from using the same identity for multiple oppositions.

All in all, the Bombay High Court has set a welcome precedent. Hopefully only deserving patents will be granted and no patent application will be delayed unduly by pre-grant oppositions.

Shukadev Khuraijam
Partner, Remfry & Sagar
Ankush Verma
Managing associate, Remfry & Sagar

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