Damages are entirely insufficient as panacea for the holder of a valid patent: High Court of Delhi

It is also a well-settled position in law that damages are entirely insufficient as a panacea for the holder of a valid patent, which is infringed by another. Intellectual property has its own sanctity. The prejudice caused even by a single day’s infringement of intellectual property is, in principle, incalculable. It is fundamentally incongruous, therefore, to suggest that, even while the applications for injunction, preferred by the plaintiff in the suits under Order XXXIX of the CPC, are being heard by this Court and are, in fact, at the stage of rejoinder, the defendants should be allowed to launch the allegedly infringing CTPR products.’. This was held in FMC CORPORATION V. BEST CROP SCIENCE LLP & ANR.[I.A.5801/2021 in CS(COMM) 69/2021] in the High Court of Delhi by a single bench consisting of JUSTICE C. HARI SHANKAR.

Facts are the plaintiff alleges infringement by the defendants of Indian patents held by the plaintiff. Of these one is a product patent and one is a process patent. The plaints allege that the defendants are intending to launch CTPR, which is specifically covered and disclosed, and held by the plaintiff. The action of the defendant will infringe the plaintiff’s rights and they thus have prayed for a permanent injunction against the defendants.

The counsel for the defendants contended plaintiffs patents IN 307 and IN 332 are ab initio invalid patents and as IN 978 has expired, thus the defendants are now entitled to launch their CTPR product in the market.

The court made reference to the judgment of the court in the case of Astra Zeneca AB v. Intas Pharmaceuticals Ltd., wherein it was held that “What persuades me to decline injunction, in addition to what I have stated above, is also the fact that in this case damages if proved at trial, appear to be compensable. The defendants have averred that the plaintiffs have, possibly, licensed their rights under the suit patents to two entities i.e. Sun and Abbott. The packaging of the products of the drug sold through these entities is indicative of this aspect. The plaintiffs, however, for reasons best known to them have not placed on record the agreements arrived at with these entities in support of their plea. Therefore, it has to be inferred that the said entities are licensees.”.

The court also made reference to the judgment of Delhi high court in  Merck Sharp and Dohme Corpn. v. Glenmark Pharmaceuticals, wherein it was observed that “The Court must be mindful – especially in a case where a strong case of infringement is established, as here – there is an interest in enforcing the Act. It may be argued that despite this no injunction should be granted since all damages from loss of sales can be compensated monetarily ultimately if the patentee prevails. This argument though appealing is to be rejected because a closer look at the market forces reveal that the damage can in some cases be irreparable. This in turn leads to the third principle, which is where an infringer is allowed to operate in the interim during the trial, it may result in a reduction in price by that infringer since it has no research and development expenses to recoup – most revenue becomes profit.”

Considering the facts of the case and the legal precedents, the court observed there can be no reasonable justification for permitting the defendants, even while the arguments in the plaintiff’s applications under Order XXXIX of the CPC are at the stage of rejoinder, to allow the defendants to release the allegedly infringing CTPR products in the market, thereby effectively rendering the applications under Order XXXIX of the CPC infructuous. Thus the court granted an injunction.

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