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Enforcement of Patent Rights in South and South East Asia: Comparative Case Law

In South and Southeast Asia there is a growing awareness of patent rights and parties are now more willing to litigate to protect their patents in this huge and growing market. In Southeast Asia there is a lack of homegrown jurisprudence particularly as the various countries share various colonial legacies in terms of their legal systems and due to the lack of case laws. Singapore could be said to be the most active jurisdiction here with the most developed local authorities followed by Malaysia, both relying on British common law as a basis of their jurisprudence. The Philippines too has a reasonable amount of patent litigation and utilizes the common law system based on American jurisprudence.

Thailand, Indonesia and Vietnam have civil law systems, which encompass a smaller precedent base to build on, but Thailand has made some strides by having a dedicated Intellectual Property court.

The situation in India is more vibrant due to it’s litigious culture coupled with a more advanced science and technology sector especially in recent times, however reported patent decisions are very rare. With increased foreign filings, it is forecasted that this position is bound to change in the near future as the foreign patent owners and India’s new technology and pharmaceutical companies are bound to enforce their rights more vigorously.

The selection of cases below are merely illustrative of the current developments that are happening in Patent Law in specific countries of the Southeast Asia including India and are to give the reader a feel of the said developments.

Malaysia

Malaysia has seen its first case pertaining to the issue of whether a “file wrapper search” can be executed in Patrick Mirandah v Director General, Malaysian Intellectual Property Corporation.

The Patent Registry of the Malaysian Intellectual Property Office (MyIPO) has thus far not allowed a third party to inspect or obtain copies of any documents other than the granted patent specification themselves, unless there is written consent from the patent owner. The stand taken by the Registry is that any communication between the applicant and the Registry, other than the granted specification, should remain confidential, even after grant of the patent.

Therefore when the applicant here sought to inspect the file of a granted patent akin to a “file wrapper search”, The Registry objected to the same on the grounds that the correspondences are confidential. This resulted in a Motion being filed at the Kuala Lumpur High Court wherein the Applicant pleaded to Court to declare that the Registry is compelled to permit the said file search.

The applicant submitted that a written consent from the patent owner is only required for pending patent applications, as the same is confidential but not for granted patents. The fact that the patent has been duly granted shows that the element of confidentiality no longer exists and therefore a third party should be entitled to inspect the file at the Registry to obtain the case history and any relevant extract. It was also argued that if Parliament intended to restrict public access only to the granted specification, then the said restriction would have been specified in the Patents Act. On principles of statutory interpretation, it was submitted that if a statute is clear and unambiguous, a literal interpretation should be taken of the words in the statute. In this case section 34(1) of the Patents Act clearly provides that a patent file can be inspected and extracts can be obtained as soon as the patent application proceeds to grant.

Based on these submissions, the Court granted the application. This is a positive development as far as the Malaysian patent regime is concerned, as in any litigation concerning the granted patent; the prosecution history can now be brought up to show whether the applicant made concessions to the Registry, which would be a factor taken into account by the Court in construing the claims.

Indonesia

A recent case in Indonesia, Honda Motor Co Ltd v Mocin illustrates that it is crucial for patent owners to ensure that their patents are accurately translated into the local language Bahasa Indonesia when they are being filed.

Here HONDA MOTOR Co Ltd of Japan had filed a patent in Indonesia No ID 0000 284, relating to internal combustion engine technology. Patents based on the same technology were filed in a number of countries including China. However HONDA’s Chinese patent was abandoned. A Chinese company based in Indonesia known as MOTOR CINA (MOCIN) had been utilizing the technology similar to HONDA’s patent in China, which faced no objections there as HONDA’s patent application was abandoned. MOCIN however then decided to use the technology in Indonesia.

When MOCIN commenced use of the technology in Indonesia, HONDA asserted their patent rights against MOCIN and filed a suit against them for patent infringement in 2005. Indonesian patent prosecution practice requires that patent specifications should be in the Indonesian language, although an English language version may also be filed. This is due to the requirement in the Indonesian Patents Act that the application be filed in Indonesian language. Furthermore in the Indonesian Courts all proceedings and documents have to be in the Indonesian language, or a sworn translation must be provided.

In the patent infringement suit brought by HONDA, the Indonesian Court used the Indonesian language version of the specification. During the trial, the court found that although based on an analysis of the English version of the scope of claims, MOCIN might have infringed HONDA’s patent and therefore HONDA would have a case. However based on an analysis of the Indonesian version of the scope of claims, MOCIN was not found to be infringing HONDA’s patent.

This was as HONDA’s first independent claim was based on the English language specification that covered a decompression device for a four-stroke cycle internal combustion engine having at least one power cylinder, a crankshaft and a valve projecting into the combustion chamber of the power cylinder. The first claim in the Indonesian language was translated slightly differently from that of the specification in the English language and due to this, the width of the first claim and the following dependent claims were therefore constricted resulting in MOCIN being found not to be infringing.

As patent infringement trials rely significantly on how the applicant claims the subject matter and the supporting description, translations would need to be accurate particularly for inventions that involve scientific formula and terminology. Therefore the translated version of a patent specification can have an impact in Indonesia or in other countries where the national language prevails.

Singapore Singapore has seen its first major patent case in a while with the judgment in Trek Technology (Singapore) Pte Ltd v FE Global Electronics Pte Ltd and Other Suits [2005] SGHC 90. The High Court here considered a patent infringement case and commented on various aspects of patent law which given the dearth of local authority on the subject matter was a welcomed development.

Here Trek is a Singapore incorporated company, which claimed the invention of a mass storage device designed to be as portable and compact as the conventionally known floppy disk or CD-ROM storage media. This portable device called a ThumbDrive is capable of being inserted into any universal serial bus (USB) socket in a computer and become fully integrated with the same. This was heralded as a groundbreaking product and a new solution over existing conventional data storage devices.

Trek filed a patent application in Singapore on 21-02-2002 and a week later launched the device at the CeBIT 2000 exhibition in Germany. Thereafter patent applications were filed in over 30 countries and patents were granted in UK, New Zealand and South Africa.

Based on its Singapore patent (the Patent), Trek proceeded to sue M-Systems, an Israeli company that manufactured a portable data storage device known as Disk On Key (DOK) and Diskey, as well as Electec and FE Global who were respectively the exclusive importers and exclusive distributors in Singapore. M-Systems in turn sued Trek for threatened patent infringement.

Trek also sued Ritronics who manufactured and sold another form of data storage device known as Slim Disk (SD) and BioSlimDisk (BSD).

Trek’s claim was that the Patent was being infringed while the defendants challenged the validity of the Patent and alleged that misrepresentations had been made to the Registrar of Patents over the issue of inventorship and ownership.

Patent Specifications

The first issue raised was whether the specifications in the Patent disclosed the need for a cable either captive or detachable connecting the device to the computer. This was the contention of the defendants who argued that the device for coupling the data storage device and the USB socket in the computer was either a detachable or captive cable.

The court reviewed the specifications, rejected the defendant’s contention and held that a skilled addressee would take it that the Patent discloses a unitary data storage device with an integrated USB plug to enable connection to the USB socket of the computer and a purposive construction of Claim 1 disclosed a portable storage device without a cable.

Infringement

The court reviewed the DOK and Diskey devices and held it was infringing as M-Systems did not deny that the DOK and Diskey contains each and every element of the claims of the Patent. This task was not difficult for the judge as in the answers to the interrogatories (which are pre-trial questions put to an opposing party) the elements that were in the Diskey were revealed.

As to the SD and BSD devices, they were also held to contain every element of the Patent based on the answers to the interrogatories and testimony at trial.

Infringing acts committed

On the issue of the different categories of infringement committed, the court found that M-Systems sold the Diskey to Electec who then supplied it to FE Global and therefore there was importation and disposal of their product in Singapore, which is an infringing act.

However the interesting aspect of the Court’s decision is that it found that M-Systems had disposed off the Diskey product in Singapore by offering the same on its website. The court rejected the defendants argument that promotion of products on the website is not an offer to sell in Singapore. This is as both the M-Systems and FE Global websites have Singapore on its list of countries where DOK is sold.

Therefore it appears that the position is now clear that offering of products on the web especially when they are stated to be available in the jurisdiction will constitute an offer to sell.

The other two interesting aspects here are the torts of conspiracy and joint tortfeasorship in respect of infringement. As to the allegation of conspiracy, the court rejected Trek’s claim that there was a conspiracy to infringe the Patent, as it held that a party will only be liable for conspiracy to infringe where it actually induces the infringement or there is evidence of an understanding to carry out acts of infringement. The mere fact that M-Systems gave indemnities to FE Global and Electec was not sufficient for the court to infer that inducement had taken place to constitute acts of patent infringement, as the threshold of proving conspiracy is high.

On the claim of joint tortfeasorship against M-Systems and the two defendants on grounds that the acts of infringement were carried out in furtherance of a common design, the court followed the English decision of Morton-Norwich Products Inc v Intercen Limited [1975] RPC 501 where it held that two persons who agree on a common course of action and commit a tort would be joint tortfeasors. The court looked at the relationship of the parties especially the indemnity given by M-Systems and held there was a common design to infringe the Patent.

Amendment of the Patent

During the court proceedings Trek sought to amend the Patent in order to claim and clarify the true nature or extent of the ThumbDrive invention. The court confirmed that it had the power to amend under the Patents Act provided there is no disclosure of additional matter or the protection conferred by the patent is not extended.

In order to ascertain whether additional matter is disclosed by the amendment, the court adopted the three-step test as formulated by the English Courts in Bonzel v Intervention Limited (No 3) [1991] RPC 553 at 574 which is:

To ascertain through the eyes of a skilled addressee what is disclosed, both explicitly or implicitly, in the application;

To do the same in respect of the patent granted; and

To compare the two disclosures and decide whether any subject matter relevant to the invention has been added by the proposed deletion or addition.

The court found that as viewed by the skilled addressee there was no disclosure of additional matter or extension of protection by the amendments sought and furthermore the amendments were supported by the existing specifications.

As to the defendants objections to the amendments on the grounds that if a disclosure teaches the use of a broad class of elements, a specific element within that class cannot be claimed, the same was rejected by the court as the proposed amendments limit the scope of the Patent as filed.

Discretion

A crucial part of the decision was the court’s review of the issue relating to the scope of discretion that is to be exercised in determining whether amendments should be allowed. The scope was set out in the English case of Smith Kline & French Laboratories v Evans Medical Limited [1989] FSR 561:

whether the patentee has disclosed all relevant information with regards to the amendments;

whether the amendments are permitted in accordance with the statutory requirements;

whether the patentee delayed in seeking the amendments(and if so ,whether there were reasonable grounds for such delay);

whether the patentee had sought to obtain unfair advantage from the patent;

whether the conduct of the patentee discourages the amendment of the patent.

The court held that the basis for taking the approach in Smith Kline as above would be anachronistic and out of step with the modern law of patents following the recent English decision in Instance v CCL Labels Inc [2002] FSR 27. The court felt that in deciding whether or not discretion should be exercised in favour of granting an amendment, judicial attitudes would be shifting towards scrutiny of the conduct and motives of the patentee. The court approved the English decision of Mabbuchi Motor KK’s Patents [1996] RPC 387 which took the view that the overriding principle would be whether there was grave misconduct by the patentee or bad faith (or fraud or dishonesty or insincerity) and whether there was an effect on the public. The court also accepted that the approach of the courts in applying its discretion has become more lenient as stated by the editors of the CIPA Guide (2001 edition).

Defenses

There were two substantive defences raised by the defendants:

(a) the lack of novelty and inventiveness of the invention as expressed in the patent;
(b) misrepresentation concerning inventorship, and/or ownership of the Patent.

Novelty and Inventive Steps

On the lack of novelty the court perused the prior art documents and found that the prior art did not disclose an integrated mass storage device with an integrated plug. This is as the entire subject matter of the Patent comprises a portable mass storage device with an integrated USB plug that directly plugs into the USB socket of a computer without a cable connection. Therefore, there was no lack of novelty.

As to inventive step, the court applied the Windsurfing test and held that the prior art did not lead the skilled addressee to view an integrated device as the obvious next step in the technology. The court went on to hold that the findings of novelty and inventive step were fortified by the accolades and commercial success enjoyed by the invention.

Misrepresentation

The Patents Act in Singapore provides for revocation in the event the patent was obtained on a misrepresentation. In respect of this the court held that the onus was on the defendants to show that the misrepresentation must have actually deceived the registrar into granting the Patent.

In this case, there were some material errors such as a co-inventor’s name being omitted from the application, which were subsequently corrected and therefore the court held that the errors did not materially contribute to the decision whether or not to grant the Patent.

Conclusion

The Singapore courts have therefore clarified the position on various matters by approving and adopting the current English authorities on various aspects of patent law including matters such as adopting a liberal approach to the amendment of claims, sale by website dissemination and joint tortfeasorship.

Vietnam There has also been a lack of patent litigation in Vietnam. However an interesting new development has been a design patent case between two Vietnamese parties, which will point the way towards greater recognition of intellectual property rights in Vietnam that will ultimately benefit foreign parties filing in Vietnam.

In the case of Duy Loi Hammock Company v Truong Tho Trading and Production Company at the Ho Chi Minh City Peoples Court, Duy Loi Hammock Company (the Plaintiff) filed a suit against Truong Tho (“Defendant”) for VND 100 million and was counter-sued by the Defendant.

Background Before we go into the case in Vietnam itself, it will be pertinent to illustrate the Plaintiff’s international experience in intellectual property litigation which shows that in an increasingly globalized world even relative small business in third world countries have to be equipped to deal with intellectual property issues, as they become export orientated.

The Plaintiff had effectively modified a hammock structure and decided to seek protection at the National Office for Intellectual Property (“NOIP”), which was filed in March 2000 and published in the Vietnamese Industrial Property Gazette on June 26th, 2002. The Plaintiff’s collapsible hammocks quickly became a household item in Vietnam due to its foldable and easy to carry structure, The Plaintiff then managed to secure sales in foreign markets such as the United States, Japan, South Korea and Australia.

The Plaintiff’s first brush with patent litigation was in Japan when the owner of a Japanese patent brought a claim that the Plaintiff’s product infringed its Japanese patent. The Plaintiff had however filed his patent application in Vietnam and had it granted prior to the priority date of the Japanese patent and so the Japanese patent was challenged and revoked due to a lack of novelty.

The next litigation experience of the Plaintiff occurred when a Taiwanese distributor residing in the United States claimed that he owned a US patent which claims cover a hammock structure similar to that of the Plaintiff’s. However again the US patent was filed after the Plaintiff’s design patent had been filed in Vietnam and also after the collapsible hammock had been disclosed to the public. The suit is still pending in the US but the Plaintiff seems confident that the patent concerned has been anticipated by the prior art.

The Vietnamese case In Vietnam the Plaintiff in 2005 discovered that the Defendant had been illegally producing collapsible hammocks having a design, which they claimed was substantially similar to that as claimed by the Plaintiff’s design patent. This resulted in the seizure of more than 400 hammocks produced by the Defendant’s. The Defendant’s response was to challenge the validity of the Plaintiff’s patent on the grounds of lack of novelty by asserting that such hammocks were available in Vietnam since 1975. The Defendant then petitioned for the release of the hammocks which was granted, which then precipitated the above suit by the Plaintiff in the Ho Chi Minh City People’s Court.

The case has just been settled with the Plaintiff dropping its claim for damages in return for the Defendant agreeing to cease all production, display and circulation of the hammocks.

In a related development, the Deputy Director General of the NOIP, Hoang Thanh Tan announced that the public should not depend solely on the NOIP when it comes to such intellectual property disputes citing the Duy Loi case above as an example. He stressed that upon the grant of a patent in Vietnam, the patented product must be protected by the state and so the Market Control Department and the Courts should be able to implement their respective responsibilities independently without consulting the NOIP.

The increased awareness and use of local authorities of the intellectual property law system augurs well for all users of the same.

Thailand

A recent case of interest in Thailand is Aventis Pharma S.A. v Bioscien Company Decision No. 79/2548

Here the plaintiff alleged that the defendant infringed its process patent by importing pharmaceutical products created by using the patented process. The plaintiff had served a notice demanding that the infringement be discontinued but the defendant refused to cooperate. The plaintiff sought to restrain the defendant from arranging further import of the disputed products as well as damages. The defendant argued that their imported products were created using different process and therefore did not infringe the plaintiff’s patent.

The plaintiff produced evidence demonstrating that there had indeed been an infringement. However, the court noted that since the defendant demonstrated that it had exercised due care in seeking counsel of an expert regarding the possibility of infringement, they had acted in good faith. The court therefore issued, in favour of the plaintiff, an order permanently restraining the defendant from engaging in further importation of the infringing product. However, the court refused to award plaintiff the damages, reason being that the defendant believed in good faith that they had the right to import such a product.

This case demonstrates how the court assesses and tailors the damages against infringing conducts. Thai patent law treats infringement as strict liability. However, in civil cases, the court has the right to exercise its discretion as to whether damages should be granted.

Phillipines

In the Philippines the parties may use the unfair competition legislation together with intellectual property laws to enforce their rights as shown in Smith Kline Beecham Corporation vs. CA and Tryco Pharma Corp., GR No. 126627, August 14, 2003

Here the Petitioner sued the Respondent for infringement of its patent and unfair competition. It claimed that its patent covers or includes the substance Albendazole. It claimed that respondent, by manufacturing, selling, using, and causing to be sold and used the drug Impregon without its authorization, infringed its patent as well as committed unfair competition for advertising and selling as its own the drug Impregon although the same contained petitioner’s patented Albendazole.

Petitioner attempted to use doctrine of equivalents but the Petitioner’s claim was dismissed. On appeal, the Court of Appeals upheld the trial court’s finding.

India

A recent development not in the courts but at the Indian Patent Office would be the Patent’s Office rejection of Novartis’s patent application for ‘Gleevec’, an anti-cancer drug. This decision is yet another turning point in the long drawn legal battle on ‘Gleevec’.

Briefly the background of the case is as follows: Novartis filed a patent application in India on 17.7.1998 covering the “Beta Crystalline form of Imatinib Mesylate” and applied for Exclusive Marketing Rights (EMR) pending grant of a product patent in the WTO/Mailbox. The Patent Controller granted EMR to Novartis on 10.11.2003. Novartis brought legal actions by way of a suit for infringement against generic drug makers on the strength of the EMR before the High Courts of Madras and Bombay. The decisions of the High Courts were conflicting. In a well-reasoned Judgment the Madras High Court held that the EMR is valid, but the Single Judge at the Bombay High Court took a different view. The key argument advanced by the generic drug makers against whom Novartis brought legal actions was of anticipation by publication and/or claiming of the Imatinib Mesylate prior to the priority date of the Indian patent application. Novartis countered this argument on the ground that an EMR application was required to be examined only with respect to compliances of sections 3 and 4 of the Patents Act [as per Section 24-A which has been repealed by the Patents (Amendment) Act, 2005] and the question of anticipation by prior publication or prior claim is not relevant to the examination of an EMR application. The Madras High Court favorred this argument of Novartis, but the Bombay High Court did not. The Opposition decision from the Chennai Patent Office comes at a time when the debate on the EMR cases continues.

The Patent Controller’s decision is pursuant to multiple pre-grant oppositions filed against the product patent application for Gleevec numbered 1602/MAS/1998. Many generic drug companies including the Cancer Patients Aid Association, India opposed this patent primarily on the grounds of (a) Anticipation, (b) Section 3(d), (c) Obviousness and (d) wrong priority. The Assistant Controller of Patent who heard the pre-grant opposition took the position that the invention titled ‘Crystal Modification of A N-Phenyl-2-Pyrimidineamine derivative, processes for its manufacture and use’ is not patentable over all the aforesaid grounds. The most substantive of the above objections was the one based on Section 3(d) whereby it was argued by the Opponents that the claimed invention was directed at a new polymorphic form of imatinib mesylate which did not differ significantly in properties with regard to efficacy, hence unpatentable.

If Novartis prefers to file an appeal against this decision, it has to be filed before the High Court. The IP Appellate Board is yet to commence hearing appeals from the decisions of the Patent Controller. The legal battle thus continues.

Another case which illustrates patent law in India is the case of Fabwerke Hoesht Aktiegesellschaft v Unichem Laboratories and others AIR 1969 Bombay 255.

Here it was held by the court that an invention consisting of the production of new substances from known materials by known methods cannot be held to possess new subject matter merely on the ground that the substances produced are new, for the substances produced may serve no useful purpose, in which case the inventor will have contributed nothing to the common stock of useful knowledge (the methods and materials employed being already known) or of useful materials (the substances produced being, ex hypothesi, useless).

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