INTELLECTUAL PROPERTY APPELLATE BOARD

Guna Complex, Annex-I, 2nd Floor, 443, Anna Salai, Teynampet, Chennai 600 018 ***** (CIRCUIT BENCH SITTING AT DELHI) OA/5/2013/PT/DEL and M.P.No.13/2013 in OA/5/2013/PT/DEL TUESDAY THIS, THE 14TH DAY OF MAY, 2013
HONBLE SMT. JUSTICE PRABHA SRIDEVAN HONBLE SHRI D.P.S. PARMAR CHAIRMAN - TECHNICAL MEMBER

1. Sugen Inc An American Company of 230, East Grand Avenue South San Franscisco, California 94080-4811 United States of America through Ms. Anamika Gupta, Authorized Signatory 2. Pharmacia & Upjohn Company LLC An American Company of 301, Henrietta Street, Kalamazoo, MI 49001 United States of America through Ms. Anamika Gupta, Authorized Signatory

--- Applicant 1

--- Applicant 2

(By Advocate Shri T.R. Andhyarujina and Shri S.C. Agarwal, Sr. Advocates, Shri Praveen Anand, Ms. Archana Shankar and Ms. Adiya Gupta, Advocates)

Vs
1. Controller General of Patents, Design, Trademark And Geographical Indications Patent Office, Intellectual Property Office Building Plot No.32, Sector 14, Dwaraka, New Delhi - 110075 2. Cipla Ltd., 289 Bellasis Road, Mumbai Central Mumbai 400008 Maharashtra

---- Respondent 1

--- Respondent 2

Also at: A-37, 2nd Floor, Connaught Circus, Connaught Place, New Delhi 110001.

(By Shri Shri S. Majumdar, Ms. Roy Choudhary, Advocates, Ms. Sandita Ganguly
and Ms. Mythili Venkatesh, Patent Agents for Respondent 2)

ORDER (No.107/2013)
HONBLE SMT. JUSTICE PRABHA SRIDEVAN, CHAIRMAN: 1. This is an appeal against allowing the post-grant opposition filed by the Respondent. In view of the emergency expressed by the Counsel we have dictated the operative portion of the order. The reasons will be given in a few days and the whole order will be issued. The impugned order is set aside and the matter is sent back to the Controller General with directions to constitute a fresh Opposition Board and to nominate a Controller other than the Controller who has passed the impugned order to decide the matter within a time-bound frame. 2. The Opposition Board shall be constituted within 15 days from the date of communication of this order and the documents mentioned above shall be furnished to the Board. The Opposition Board shall consider the documents and forward the recommendations on the grounds raised by the Respondent within six weeks thereafter to the Controller so named. 3. The Controller shall without delay forward the copy of the Recommendations of the Opposition Board to the counsel for both the parties and fix the date of hearing within two weeks thereafter. The counsel shall cooperate in the expeditious hearing of the matter. 4. The decision of the Controller shall be given preferably within four weeks from the date of hearing. The Controller shall consider the entire matter afresh and as regards Section 8 of the Patents Act, the Controller shall bear in mind that since it is the duty of the Patentee to comply with the provisions of S. 8 of the Act, what has been furnished by the Patentee/Appellant is alone relevant to decide this issue and not what is available on the internet. The Controller shall pass orders in accordance with law. 5. The appellant shall maintain the status quo vis-a-vis the respondent till the decision is given by the Controller. 6. The appeal is allowed as above. The M.P for stay is closed. No costs. (D.P.S. PARMAR) SRIDEVAN) (JUSTICE PRABHA

Technical Member

Chairman

FRIDAY THIS, THE 17th DAY OF MAY, 2013

HONBLE SMT. JUSTICE PRABHA SRIDEVAN HONBLE SHRI D.P.S. PARMAR CHAIRMAN - TECHNICAL MEMBER

ORDER

HONBLE SMT. JUSTICE PRABHA SRIDEVAN, CHAIRMAN: 1. It is unfortunate that this patent litigation has been going back & forth only because there are procedural lapses in the IPO. It benefits neither the patentee nor the opponent. If the patent is good then the ongoing litigation is an unnecessary harassment for the patentee. If the patent is bad then in spite of being revoked twice having the appeal allowed on a technical plea which goes to the root of the matter, is unfair to the challenger and harmful to public interest. This is avoidable and must be avoided. We hope that in future such lapses do not arise and the main issue regarding the patentability of the invention is decided without delay. 2. The invention that is claimed is IN 209251 for PYRROLE SUBSTITUTED 2-INDOLINONE PROTEIN KINASE INHIBITORS. It is an anti cancer drug and goes by the name Sunitinib. The patent was granted on 23.08.2007. The post grant opposition was filed by the respondent on 29.08.2008. In the Form -7 they had cited four grounds, that the invention was publicly known or publicly used {Sect.25 (2) (d)}, that the invention is obvious and does not have an inventive step { Sect.25(2) (e)}, that it is not an invention{ Sect 25(2)(f)}, and that section 8 of the act was not complied with(Sect 25(2)(h)} . In the written statement under Sect.25 (2) the opponent had raised basically the same grounds, and in particular it mentioned that the opposition must be allowed under S.25 (2)(e) in view of the following documents: a) D1 US 5886020 published on March 23, 1999 (Exhibit I) b) D2 WO/98/50356 published on November 12, 1998 (Exhibit II), and c) D3 WO/99/61422 published on December 2, 1999 (Exhibit III). In response to the written statement and Form 7 along with the Exhibits, the appellant filed along with the evidence of Dr. Cui (Cui 1 in short) their reply statement on 29.10.2008. The respondent filed their evidence under Rule 59 of the Patent Rules belatedly on 06.01.2009. They had filed petitions under Rules

137 & 138.Thereafter the appellant filed the affidavit of Dr. Cui (Cui 2 in short) on 8th June 2009. The Opposition Board was constituted and after examination held against the grant, gave its recommendations. The Controller held the hearing on 21.02.2012 and the patent was revoked on 24.09.2012. 3. This was the first round. The appellant challenged this on several grounds but restricted the challenge to the non- furnishing of the Boards report. The matter finally went to Supreme Court and it was held that the non- furnishing of the Boards report resulted in violation of principles of natural justice and the revocation was set aside. The Controller was directed to dispose of the matter afresh. When the matter came back to the Controller the appellant attacked the revocation order on merits and also for not sending Cui 2 to the Opposition Board, and that the reply evidence filed by the respondent was time barred and that Exhibits D1, D2 & D3 should not have admitted since Section 25 (2)(b) was not taken as a ground , & that the reply evidence was beyond what is prescribed in Rule 59. 4. The Controller passed the impugned order rejecting all the objections and holding that the patent was obvious and lacked inventive step accepting the recommendation of the Board. The Controller also rejected the case of the respondent that Section 8 was violated. She held that The details cited by the opponent are from the WIPO website and internet which is freely available to the controller and examiner. Therefore the ground of section 8 is not maintainable. 5. Now this is the second round. Against the revocation for the second time, the appellant has filed this appeal and the respondent has filed OA/6/2013 against the rejection of the ground under Section 8. 6. The learned senior counsel Mr. Andhyarujina & Mr. S.C. Agarwal & Mr. Praveen Anand made their submissions on behalf of the appellant. Mr. S.Majumdar argued for the respondent. 7. The appellant has challenged the order for the procedural and technical defects and also for wrongly deciding the issue of patentability in particular the issues relating to inventive step and obviousness. Both the learned senior counsel addressed the issue of maintainability on the ground of procedural flaws. 8. At this stage we informed the counsel that if after hearing both sides on the preliminary grounds , we felt that if there was indeed an error in procedure then we would not hear the matter on the merits of the patent but we would send it back for rehearing. 9. According to the appellant the opposition was not maintainable on four grounds firstly the ground under Sect.25 (2)(b) was not taken. This ground was conspicuous by its absence and hence the decision of the Controller on the basis of prior publication was not sustainable. The Patent Act requires that the opposition will be entertained only on the grounds mentioned and no other grounds. If Section 25(2)(b) was not put to the Opposition Board, then the Board would have no occasion to deal with it. Form 7 was pointed out where it says state the grounds taken one after another. It was submitted that though the respondent may have mentioned prior publication in its pleadings the Act

required that this ground is specifically taken. In patent law it is not sufficient if there are substantial pleadings, specific ground must be stated. 10. Next the appellant was aggrieved by the reception of the reply evidence under Rule 59. According to the appellant Rule 137 cannot be invoked when 138 (2) is clear. Unless the request for extension of time was made under these rules within the prescribed period which is one month from the date of delivery to the opponent of a copy of the patentees reply statement (Rule 59) no extension can be granted. In this case the Reply statement was served on the respondent on 5th November 2008 and hence the extension petition should have been filed on or before 5th December 2008. It was filed only on 16th December 2008 and therefore time could not have been extended. When the appellant had specifically raised this objection before the Controller for receiving the respondents evidence which was out of time, the impugned order without giving valid reasons merely stated that the petition Was considered by the office and therefore it was not time barred. This was not a valid reason. When the statutory rules are clear, the principles of natural justice cannot be invoked to subvert the Rules. The reception of this evidence was a serious flaw. It is true that Cui 2 referred to the affidavit filed in this time- barred reply evidence that can not mean that there was acquiescence. The appellant had to rebut the evidence to support his case and hence had to deal with it. The appellant has no power to waive the statutory effect of Rule 59. 11. Thirdly the controller ought to have sent Cui 2 to the Opposition Board. This was further evidence filed under Rule 60, before the Board was constituted. The Controller was bound to forward the notice of opposition along with all the documents to the Board so that it could give its recommendations (Sect 25(3)(b)) The failure to forward Cui 2 had resulted in injustice. 12. It was submitted that these three grounds were not merely technical they are crucial since the patent laws require strict compliance. It was submitted that in the earlier round of litigation the appellant could only raise the limited ground of non furnishing of the report of Board .Only after the report was furnished, that they realised that Cui 2 was not given. So when they went back to the Controller after the order of the Honble Supreme court they raised this as a ground and yet the Controller merely said that it was not filed in accordance with Rule 60. Had there been a defect in the filing of the further evidence, the Office could have pointed out and the Appellant would have set right the defect. If the Opposition Boards recommendations are necessary to be considered by the Controller then the Recommendations which are made without the entire evidence cannot be accepted. It was also submitted that there was no prescribed form or fees for filing further evidence under Rule 60. The Controller could not have decided the matter de hors the recommendations of the Opposition Board. 13. The following decisions were relied on: 1. (2008) 17 Supreme Court Cases 491 - Bachhaj Nahar vs. Nilima Mandal and another. This was cited to show that without pleadings, no evidence can be looked at.

2. (1988) 3 Supreme Court Cases 534 State of Andhra Pradesh vs. Nagam Chandrasekara Lingam. This was cited for seeking a direction that in the event the matter was remanded a fresh Opposition Board should be constituted and the matter should be heard by another Controller. 14. Mr. Majumdar, the learned counsel for the Respondent submitted that Section 25(2)(b) was not given up. This ground is found in the statement of case. Next he submitted that the reply evidence filed along with the Petitions under Rules 137 and 138 was rightly accepted since the prescribed period would include the one month which was allowable under Rules 138 and therefore the petition filed before that period was not barred. He cited 2011(46)PTC 70(Mad) (Nokia Corporation Vs. Deputy Controller,) in this regard. 15. He submitted that Cui 2 was filed along with a letter dated June 8 2009 stating that it was a representation under S.25(2) r/w Rule 55, without any indication that it was further evidence filed under Rule 60. There was no petition and no fees, so how was the Controller to take it as a document filed under Rule60? He produced a copy of the proceedings in connection with another matter where the evidence was filed accompanied by fees. He submitted that at no point at the earlier stage of the litigation had this plea of non-reception of Cui 2 been raised. This plea is an afterthought. He submitted that when the ground that it is not an invention has been taken the reception of D1 to D3 as publication which render the invention was proper. The learned counsel submitted that if the appellant was really aggrieved by these grounds they should have been raised in the earlier round of litigation. The fact that they restricted themselves to the non-furnishing of the Opposition Board report barred them from raising these grounds now. These preliminary grounds do not merit acceptance and deserve to be rejected. 16. We have considered the materials and we are of the opinion that on these preliminary issues, the matter should be sent back for re-hearing after constitution of the Opposition Board afresh and obtaining their recommendations. We must accept the explanation given by the Appellant that until they saw the Opposition Boards report they could not have known whether Cui2 had been sent, and they raised this ground before the Controller on the second round. 17. The first ground we will take up is the one relating to the evidence filed under Rule 59 not being strictly confined to matters in the Patentees evidence. According to the appellant the evidence filed by the respondent including the affidavit of Dr.Rao had not been confined to the evidence that they had filed under Rule 58. It is the case of the appellant that they had filed Cui 2 only to meet and rebut the evidence filed under Rule 59. If so, they are not prejudiced by the contents of the respondents evidence. Even otherwise it is open to the appellant to point out the matters which are extraneous at the time of hearing, and the Controller will decide the question in accordance with law. This ground is rejected.

18. The next ground relates to Section 25(2)(b). The ground of 25(2)(e), has been taken. This is mentioned in the Form 7 but there is a typographical error, instead of referring to clause (b), the respondent has typed clause (a). The appellant submitted before us that the respondent has raised the ground of section 25(2)(e).which is a ground for revocation if the invention so far as claimed in any claim of the complete specification is obvious and clearly does not involve any inventive step, having regard to the matter published as mentioned in clause (b) or having regard to what was used in India before the priority date of the claim So clearly and unambiguously S.25(2)(e) takes within it S.25(2)( b). Therefore, we are not persuaded that this is a ground not taken. In any event, D-1 to D-3, being the appellants own invention and own patents, it would have been in the spirit of honesty to have referred to D-1 to D-3 in the complete specification. Not having done that, we will not allow the appellant to go nit-picking that 25(2)(b) was not taken especially since 25(2)(e) which is taken includes 25(2)(b). That apart S.25 lays down the grounds on which alone the patent can be refused (pre-grant). If the ground has been pleaded in the written statement but not listed in the grounds, the Controller may apply it, the only requirement being that the Patentee should know he has met this ground. In this case the Appellant has not been taken by surprise. Such issues of technicalities which do not result in injustice may not weigh with us. But in this case as we have seen even that does not arise. This ground is rejected 19. Thirdly, we have to see whether the Controller ought to have received the evidence under Rule 59. Rule 59 requires the opponent to file the reply evidence within one month from the date of delivery of the copy of the appellants reply statement and evidence under Rule 58. This was sent by the appellant on 29th of October, 2008 and received by the Respondent on 5/11/2008. Therefore, the respondent should have filed the reply evidence within one month from that date, which fell on December 5th, 2008. Under Rule 138, they are given one month more to file the evidence, if the Controller thinks fit to do so. They filed a petition under Rule 137 for condoning the irregularity in not filing the petition under Rule 138 before 5/12/2008 and also a petition under Rule 138 for extending the time. This was opposed by the appellant. This reply evidence was filed on 2/1/2009 within the extendable period, which is 5/1/2009. In the Nokia case (cited supra), the Honble Madras High Court held that on a true interpretation of Rule 138 that application for extension is to be filed within one month after the expiry of the prescribed time. In that case, the prescribed time was 31 months under Rule 20. By applying the same ratio, the application ought to be filed within one month after the prescribed time under Rule 59, which is one month. Therefore, within two months from the date on which the Patentees evidence was delivered, the application for extension of time (one month under Rule 58 plus one month under Rule 138) should be filed. Here it has been filed within that time. In that case, the Honble Madras High Court directed the Deputy Controller to decide the application under Rule 137 and 138 as having been filed properly. Applying this, we find that there is

no error on the part of the Controller in receiving the evidence filed by the Respondent. This objection is rejected. 20. Finally we come to the affidavit, which is called Cui 2. This was filed as further evidence. No time limit is fixed under Rule 60 for filing this evidence except to state that it should be filed before the controller has fixed the hearing under Rule 62. Here, the Cui 2 has been filed on August 7, 2009 along with a letter that the Controller is requested to take the documents on record. There is no response from the office. On September, 10, 2009 the appellant had written another letter stating that Cui 2 is an affidavit filed as Reply evidence, which is permissible under Rule 60 of the Patent Rules. It is true that the appellant has used the word Reply Evidence. It is clear that it is filed under Rule 60. To this too, there is no reply. We are not sure when exactly the Opposition Board was constituted. But the recommendations have been signed on May, 2011. Since the Opposition Board must submit the recommendation within 3 months from the date on which the documents were forwarded, we will work back and it may be safe to presume that the Opposition Board would have been constituted not before January, 2011. The further evidence having been received in 2009 was well within time. If there was any defect in the format as for instance, not drafting this as a petition nor paying fee invoking Item No.46 of the First Schedule to the Patent Rules, it should have been pointed out. This was not done. The office had no justification in not sending this evidence to the Opposition Board. Not having sent it, the Controller had decided to take it on record at the time of hearing. If it could not have been entertained for the purpose of forwarding it to the Opposition Board it could not have been entertained by the Controller at the time of hearing too. According to the appellant, this was a crucial piece of evidence since it answers the evidence of the experts filed by the Respondent. If so, it was essential that the Opposition Board had the opportunity to consider it before forwarding the recommendations. It is possible that even after seeing this affidavit the Board might still have held that there was no inventive step and it was obvious. But the law requires that this was placed before the Opposition Board when the recommendations were made. The unexplained non-forwarding the reply evidence of the appellant would render the Opposition Boards recommendation defective. Therefore the Controllers decision which is arrived at after consideration of the defective recommendations also becomes flawed. As we have stated earlier, there is no reason why this affidavit was not sent to the Board. On this ground we have no option but to set aside the order. The Report of the Board is an important material in the post-grant proceedings. The Controller is free to agree or disagree with it , but he must consider the report. Similarly the entire evidence must be before the Board, which is free to draw its own conclusion from the evidence . This ground is accepted. 21. We will therefore set aside the order of revocation for fresh consideration. The documents D1 to D3, the reply evidence filed the respondent and the

further evidence filed by the appellant along with all the other necessary pleadings shall be sent to the Opposition Board. 22. In view of the tortuous path this litigation has taken we think some directions must be given to avoid some lapses which could have been avoided. The opposition proceedings are quasi judicial proceedings and it is better that the parties invest it with a certain formality. a) The further evidence filed under Rule 60 is only by leave of the Controller. It is not enough to cite the Rule. The leave must be asked preferably in the form of a petition. This is not an epistolary transaction. It is a serious quasi-judicial proceeding where the granted patent may be revoked. It should be treated as such. Sending a casual letter and then crying Blue murder is improper. We are not taking a serious view in this case only because it appears that this practice has been generally followed. It is not desirable and the Controllers may hereafter, return such letters, requesting the parties to file it properly. The Controller-General may issue appropriate instructions. b) The copy of the proceedings produced by the respondent showed that in that case the Controller had directed the payment of fees for filing further evidence under Rule 60. In this case the Controller had stated that she was receiving it at the time of hearing though no fees had been paid. It is better that a uniform practice is adopted. The fact that leave is required would indicate that the parties pray for leave, which in turn may indicate that fees should be paid. We are not deciding this here. The Controller General may issue by notification whether fees is required to be paid for filing further evidence under Rule 60. c) When petitions under Rule 137 or 138 are filed there must be a record to show whether the petitions are allowed or rejected. Here too a uniform practice should be adopted. Consistency is the best protection against attacks of arbitrariness. d) The importance of giving reasons for arriving at the conclusions cannot be over-estimated. Though we have confirmed the findings in all but one in this case, all the above issues have not been dealt with by the Controller in a satisfactory manner. 23. Since we are sending the matter back to the Controller on the ground that Cui 2 was not furnished, it is necessary that an Opposition Board is constituted again preferably with members other than the same members who constituted the earlier Board. However the Controller who hears the matter now shall be a Controller other than the one who had heard it earlier, to ensure fairness. So the entire matter is open and all the grounds shall be heard and decided by the Controller, who will look at the matter afresh. We make it

clear that we have not even examined the findings in the impugned order regarding obviousness and the relevance of the prior arts, so the Controller is free to decide the issues in accordance with law uninfluenced by the earlier decisions. 24. The respondent had also filed OA 6/2013 against the finding on S.8 violation. Now that the matter is to be heard de novo right from the stage of the Constitution of the Opposition Board, this issue will also be decided by the Controller. The IPAB has in its decisions clearly held that it is the duty of the Patentee to furnish the particulars under S.8. We are surprised that the Controller should have held to the contrary and observed that such information is available on the internet. This is not the law. This duty under Sect 8 cannot be breached and if violated results in revocation. It deserves to be accorded due respect. What should be furnished by the Patentee shall be furnished by the Patentee. So the Controller shall bear this in mind while considering the ground under S.8 and examine whether the Appellant has fully complied with the S.8 Requirements. 25. The operative portion had been pronounced on 14th of May 2013 and published in order no.107/2013 and this shall be treated as forming part of that order.

(D.P.S. PARMAR) SRIDEVAN) Technical Member

(JUSTICE

PRABHA Chairman

(Disclaimer: This order is being published for present information and should not be taken as a certified copy issued by the Board.)