Introduction

In a decision dated 21 December 2023[1], a Single Judge of the Delhi High Court adjudicated a batch of suits filed by Pharmacyclics LLC and Johnson and Johnson Pvt. Ltd., pertaining to the infringement of Indian Patent 262968 (‘suit patent’) against Hetero Labs, Natco Pharma, BDR Pharma, Alkem Labs and Shilpa Medicare (‘Defendants’). The Judge also adjudicated in the same batch of suits, a writ petition by Laurus Labs challenging the judgment dated 29 September 2020 passed by the erstwhile Intellectual Property Appellate Board (‘IPAB’) upholding the validity of the suit patent[2].

The Court restrained the Defendants in all suits from manufacturing and marketing Ibrutinib, pending final disposal of the suits. The Single Judge however, considering the importance of the drug, permitted the Defendants to exhaust the stock available with them, subject to their placing, on affidavit before the Court, prior to releasing said stock in the market, the details of the stock, including Batch Numbers and dates of expiry. The Single refrained from passing any interdiction in respect of stocks of Ibrutinib manufactured by the Defendants which are already in circulation. The Court also directed that the trial in all suits be expedited.

In the present case the Court considered not just the infringement and validity aspects of the suit patents but also considered the earlier decision of the IPAB involving the suit patent and other crucial aspects.

Facts

The suit patent titled ‘Inhibitors of Bruton’s Tyrosine Kinase’ was granted in favour of the Plaintiff, and covers in Formula 4, the drug ‘Ibrutinib’. The present suits were instituted as ‘quia timet’ actions anticipating launch of the drug Ibrutinib, in the market, by the Defendants without any license from the Plaintiff. Consequently, the Plaintiffs sought interim reliefs restraining the Defendants from manufacturing and marketing the said drug. During the proceedings the Defendants did not dispute the fact that they were intending to launch the drug. However, they challenged the validity of the suit patent by invoking Section 107 (1) and Section 64(1) of the Patents Act (‘Act’) on the grounds of prior publication, anticipation, and lack of inventive step in view of prior art documents.

Further, during the pendency of the present suits, a post-grant opposition was filed by Laurus Labs which was subsequently allowed by the Patent Office on 4 March 2020, resulting in the suit patent being revoked. The Plaintiff challenged the said decision in appeal before the IPAB which was allowed by judgment dated 29^th September 2020. Pursuant thereto, Laurus Labs instituted a Writ Petition before the Delhi High Court assailing the decision of the IPAB and sought for stay of the IPAB judgment. During the proceedings in the present suits the Plaintiff relied upon on the IPAB judgment in support of the validity of the suit patent. However, the Defendants questioned the judgment rendered by IPAB while contesting that the Chairman of the IPAB at the relevant time, was not competent to hold office.

Analysis and findings of the Hon’ble Court

The Court made various observations on several aspects in the present matter namely:

Are IPAB Chairman’s orders passed post completion of tenure null and void?

Firstly, the Court took note of the point that then Chairman of the IPAB demitted office on 21   September 2019, post completion of his tenure. The Court then referred to the batch of Writ Petitions[3] with the lead matter being WP (C) 804/2020[4], filed before the Supreme Court, challenging the validity of the Tribunal Rules, 2020[5]. During the pendency of the Writ Petitions the tenure of all incumbent members of the tribunals was continued by interim orders passed by the SC till 31 December 2020. Thereafter, through another application filed in WP (C) 1439/2019, an extension was sought of the interim orders continuing the tenure of the Chairman which ended on 31st December 2020. However, while dismissing the said application the SC in its judgment dated 12 February 2021 noted that the Chairman had continued to hold office under various interim orders passed during the pendency of the said Writ Petitions. The Ld. Single Judge observed that in the order dated 12 February 2021, the SC did not ‘ did not expressly undo the effect of its interim orders, …., extending the tenure of the incumbent members of all tribunals till 31 December 2020,…’. The Court noted that the Chairman continued to hold office in conformity with the interim orders passed by the SC. Therefore, it would be erroneous to contend that the Chairman was not competent to hold office. The Court held that due compliance of the orders issued by the SC cannot be termed as wrongful as incorrectly averred by the Defendants.

Secondly, the Court confirmed the applicability of the ‘de-facto doctrine’ in the present case. Consequently, the acts performed by the Chairman after completing his tenure were de-facto coloured by lawful authority and within the scope of its jurisdiction. The Court considered several Indian and foreign judgments elucidating the de-facto doctrine, specific reliance was placed upon the SC’s decision in Gokaraju Ramaraju v. State of A.P[6] wherein it was held that, ‘the acts of the officers de facto performed by them within the scope of their assumed official authority, in the interest of the public or third persons and not for their own benefit, are generally as valid and binding, as if they were the acts of officers de jure’. Accordingly, the Court held that the IPAB Chairman’s holding of the IPAB office could not be termed as defective or illegitimate.

Thirdly, with respect to the Defendants contending that the orders passed by the Chairman post completion of tenure stand null and void, the Court noted that as the Chairman was acting under the orders passed by the SC, it was unjustified to invalidate all such judicial acts. The Court stressed on the point that tenures of the incumbent members of the tribunals were extended for ensuring that the administration and dispensation of justice wasn’t impaired.

Assessing the Controller’s order dated 4 March 2020 and IPAB judgment dated 29 September 2020 qua ‘invalidity’ of the suit patent

The Court noted that the invention covered by the suit patent was directed towards Bruton’s Tyrosine Kinase Inhibitors while one of the prior art documents pertained to Lck inhibitors. As per the Controller’s order, since the Btk and Lck inhibitors have similar structures, therefore, the suit patent was obvious to a person skilled in the art. However, while setting aside the Controller’s order,  the IPAB found that analogising Lck and Btk inhibitors was based on a flawed understanding of the invention claimed in the suit patent. While analysing the IPAB judgment the Ld. Single Judge was also of the opinion that as the prior arts selected by Laurus were not comparable with the suit patent, consequently, obviousness was not made out.

The Court observed that the IPAB had correctly compared the sequences of the Lck and Btk inhibitors as per which the Btk inhibitors had a cystiene residue at 481’st position while the Lck inhibitors had serine residue at that position in the sequence. Therefore, the Controller, fell into error in arriving at the finding either of analogy or homology between Lck and Btk inhibitors. While relying on the decision of the House of Lords in Kirin Amgen Inc. v. Hoechst Marion Roussel Ltd.[7], the Ld. Single Judge observed that the ‘principle of homology, in assessing novelty of a granted patent vis-à-vis prior art, is of especial relevance in the case of pharmaceutical patents involving protein,  nucleotides’ since even a minor difference in chemical structures may introduce changes in the effects of a drug. Further, the Court noted that the Defendants incorrectly attempted to combine different features from various prior arts i.e., based on hindsight analysis which is impermissible in the assessment of lack of inventive step.

Stay of operation of the IPAB judgment

Laurus also prayed for a stay of operation of the IPAB judgment. The Court noted that the scope of interference by the writ Court is limited to the scrutiny of whether there has been an error in exercising jurisdiction by the subordinate Court or whether the decision rendered by the lower Court is so markedly perverse so as to justify interference by way of a writ of Certiorari. Further, a stay of the operation of the IPAB judgment implies that the status quo ante existing prior to the IPAB judgment would be restored, i.e., revocation of the suit patent. This would amount to a status quo ante at an interim stage. The same is only permitted in exceptional circumstances, test for which is laid down in the seminal case of Dorab Cawasji Warden v. Coomi Sarab Warden [8] and as per the Court, this was not satisfied in the present case.

The Ld. Single Judge held that the IPAB judgment resulted in a prima facie case in the Plaintiff’s favour qua the validity of the suit patent. Also, the Defendants were unable to demonstrate any grounds beyond those urged before the Controller and the IPAB and failed to demonstrate a credible challenge to the validity of the suit patent. Therefore, a stay on the operation of the IPAB judgment was not granted. Accordingly, the Court held that a prima facie  case for grant of interim injunction in favour of the Plaintiff was made out and therefore the Court directed the Defendants to refrain from manufacturing and marketing Ibrutinib.

Conclusion

This decision put to rest any concerns that the orders passed by the IPAB after September 21, 2019 were without authority, by relying upon the de-facto doctrine. The instant Single Judge order is also important in clarifying the aspect of analogous prior art documents which is an important assessment when ascertaining inventive step of any invention. 

[The authors are Partner and Associate, respectively, at IPR practice of Lakshmikumaran & Sridharan Attorneys]

1. [1] 2023 SCC Online Del 8612
2. [2] Analysis of the IPAB judgment is available at https://www.lakshmisri.com/Media/Uploads/Documents/L&S_IPR_Amicus_October_2020.pdf
3. [3] The International Association for Protection of Intellectual Property (India Group v. Union of India, W.P (C) 1431/2019
4. [4] Madras Bar Association v. Union of India, W.P (C) 804/2020
5. [5] Tribunal, Appellate Tribunal and other Authorities (Qualification, Experience and other Conditions of Service of Members) Rules, 2020 (‘the 2020 Rules’) https://dor.gov.in/sites/default/files/Tribunal%20Appellate%20Rules_0.pdf
6. [6] (1981) 3 Supreme Court Cases 132
7. [7] 2005) 1 All ER 667
8. [8] (1990) 2 Supreme Court Cases 117