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Yahoo Inc v. Assistant Controller Of Patents & Designs
Factual and Procedural Background
The appellant, M/s Overture Services Inc., USA, filed a national phase patent application on 28.12.2005 based on the international PCT application No. IN/PCT/2001/1652/CHE. The application was published on 20.04.2007, and the request for examination was filed on 14.05.2004. The respondent examined the application, and a third party, M/s Rediff.com India Limited, filed a pre-grant opposition under section 25(1) of the Patents Act on 22.10.2007. Following the statutory procedures, the respondent refused the grant of the patent on grounds of novelty and inventive step by an order dated 27.03.2009. The appellant filed an appeal on 26.06.2009, treating the refusal as under section 15 of the Act. However, the Registry considered the appeal non-appealable as the refusal was under section 25(1). The matter was then referred to the Bench for deciding the maintainability of the appeal.
Legal Issues Presented
- Whether an order refusing a patent following a pre-grant opposition under section 25(1) of the Patents Act can be treated as a refusal under section 15 of the Act.
- Whether an appeal against such refusal under section 25(1) is maintainable before the Appellate Board.
- The scope and limits of the Controller’s power to refuse a patent under sections 15 and 25(1) of the Act and the corresponding right of appeal.
Arguments of the Parties
Appellant's Arguments
- The appellant contended that the refusal order dated 27.03.2009 should be treated as a refusal under section 15 of the Act, which confers the Controller the power to refuse a patent application.
- They argued that the Act provides only two types of scrutiny: pre-grant and post-grant, with a statutory appeal available only against post-grant proceedings, but there must be a remedy when a patent is refused.
- The appellant relied on section 43 of the Act, which provides that a patent shall be granted unless refused under section 15, contending the Controller has no power to refuse under any other section.
- Rule 55(5) and (6) of the Patent Rules, 2003, were cited to show the Controller’s power to refuse a patent after considering representations and evidence.
- The appellant submitted that section 25(1) does not empower the Controller to refuse a patent but only to dispose of representations made by a third party opponent, either by upholding objections (thereby refusing under section 15) or disregarding them and granting the patent.
- They argued that refusal under section 15 is appealable under section 117A(2), but refusal under section 25(1) is not, which creates a remedy gap for applicants if refusal under section 25(1) is not appealable.
- The appellant also referred to Articles 41 and 62 of the TRIPS Agreement, emphasizing the right to judicial review of administrative decisions.
- It was contended that the Patents (Amendment) Act, 2005 introduced a distinction between pre-grant and post-grant oppositions and limited appeal rights accordingly, but the applicant’s right to appeal refusal under section 15 remains intact.
- Finally, the appellant prayed that the appeal be held maintainable by construing the refusal order under section 25(1) as a refusal under section 15 of the Act.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Ajanta Pharma Ltd. v. Controller General of Patents, 2008 (38) PTC 452 (IPAB) | Interpretation of appeal rights relating to pre-grant and post-grant opposition proceedings. | Referred by appellant counsel to support the argument on the legislative intent regarding scrutiny and appeal rights. |
| J. Mitra Co. Pvt. Ltd. v. Assistant Controller of Patents and Designs, S.L.P (C) No. 15727 of 2008 (Supreme Court) | Clarification on the legislative intention about scrutiny and appeal mechanisms in patent grant process. | Referred by appellant counsel to bolster the argument that appeal is available only against post-grant proceedings and to highlight remedy gaps. |
Court's Reasoning and Analysis
The court examined the statutory provisions relevant to the Controller’s powers under sections 15 and 25(1) of the Patents Act and the procedural rules under rule 55 of the Patent Rules, 2003. It noted that section 25(1) provides a mechanism for third party opposition to the grant of a patent and requires the Controller to dispose of such representations within a prescribed manner and period. The Controller must either reject the representation and grant the patent or accept it and refuse the patent under section 25(1).
The court distinguished the proceedings under section 15, which involve only the applicant and the Controller, where the Controller may require amendments or refuse the application on failure to comply with requirements. In contrast, section 25(1) involves a third party opponent and results in a refusal order under that section, not under section 15.
Consequently, the court found that the refusal order dated 27.03.2009 was rightly issued under section 25(1) and cannot be treated as a refusal under section 15. The court emphasized that the appeal lies only against refusals under section 15, and there is no statutory provision for appeal against orders under section 25(1). The legislature has provided limited remedies for aggrieved third parties under section 25(2) and revocation proceedings under section 64, but no appeal for the applicant against a refusal under section 25(1).
Accordingly, the court concluded that the appeal was not maintainable as it was filed against an order under section 25(1) and not under section 15.
Holding and Implications
The court’s final decision is as follows:
The appeal is dismissed as not maintainable.
The direct effect is that refusal orders under section 25(1) of the Patents Act do not attract a right of appeal before the Appellate Board. The court reaffirmed the distinction between refusal under section 15 and disposal of representations under section 25(1), limiting appeal rights accordingly. No new precedent was set beyond the clarification of the scope of appealability in such cases.
2. The appellant M/s Overture Services Inc., USA have entered the national phase by filing the application for patent on 28.12.2005 relating to the international PCT application bearing No. IN/PCT/2001/1652/CHE. The instant application was published on 20.04.2007 as per the provisions of section 11A of the Act and the request for examination was filed by the applicant on 14.05.2004 The application was duly examined by the respondent and the third party intervention opponent M/s Rediff.com India Limited of Mumbai entered into a pre-grant opposition under section 25(1) of the Act on 22.10.2007 After following the procedures laid down in the Act and the rules there under, the respondent heard both parties on 20.08.2008 and based on the grounds of novelty and inventive step, the respondent has refused the grant of patent by issuing an order on 27.03.2009 which is the impugned order herein. Immediately the appellants preferred an appeal against the order of the respondent on 26.06.2009 stating that the impugned order dated 27.03.2009 is to be treated as a refusal of patent under section 15 of the Act. On scrutiny by the Registry of this Appellate Board this appeal was considered as non-appealable as the refusal of patent is under section 25 (1) of the Act. Hence, the matter was put up before this Bench for deciding the maintainability of the appeal.
3. The matter came up before us on 07.09.2009 at Chennai. Shri Feroz Ali Khadder, learned counsel appeared for the appellant. The counsel for the appellant referred to the order of this Appellate Board reported in 2008 (38) PTC 452 (IPAB) Ajanta Pharma Ltd. v. Controller General of Patents He also referred to the Supreme Court judgement in J. Mitra Co. Pvt. Ltd. v. Assistant Controller of Patents and Designs, S.L.P (C) No. 15727 of 2008. The counsel for the appellant cited both the cases and said that the legislature intended to provide two types of scrutiny during the grant of patent, namely pre-grant and post-grant, followed by one statutory appeal to the Appellate Board against the post-grant proceeding. The Legislature intended to obliterate appeal from pre-grant proceedings, for there existed an appeal against the pre-grant opposition under section 116 of the Act as amended by the Patents (Amendment) Act, 2002 before the grant of patent. The counsel argued that there has to be a remedy when there is a refusal of patent. The counsel argued that the Act has conferred on the Controller, namely the respondent here, the power to refuse the grant of patent only under section 15 of the Act which is evident from the language of section 43 of the Act which reads as follows:
“43. Grant of patents.-(1) Where an application for a patent has been found to be in order for grant of the patent and either—
(a) the application has not been refused by the Controller by virtue of any power vested in him by this Act; or
(b) the application has not been found to be in contravention of any of the provisions of this Act,
the patent shall be granted as expeditiously as possible to the applicant or, in the case of a joint application, to the applicants jointly, with the seal of the patent office and the date on which the patent is granted shall be entered in the register.
(2) On the grant of patent, the Controller shall publish the fact that the patent has been granted and thereupon the application, specification and other documents related thereto shall be open for public inspection.”
So the counsel argued that the patent application for the grant of patent can either be granted under section 43 or can be refused under section 15 of the Act in accordance with the powers vested in the Controller under the Act and he has no power to refuse under any other section of the Act. He also argued that the power to refuse a patent application can be exercised by the Controller any time before the grant of patent or pursuant to an opposition or otherwise and in this connection he also referred to rule 55 (5) and (6) of the Patent Rules, 2003 (hereinafter referred to as the Rules) as under:
“(5) On consideration of the statement and evidence filed by the applicant, the Controller may either refuse to grant a patent on the application or require the complete specification to be amended to his satisfaction before the patent is granted.
(6) After considering the representation and submission made during the hearing if so requested, the Controller shall proceed further simultaneously either rejecting the representation and granting the patent or accepting the representation and refusing the grant of patent on that application, ordinarily within one month from the completion of above proceedings.”
4. The counsel for the appellant also referred to the book on Law of Patents-With a Special Focus on Pharmaceuticals in India (Lexis Nexis Butterworths, 2007) wherein the author has a taken a view that a patent applicant has a remedy in appeal before the Appellate Board in case of rejection of his application for patent pursuant to a pre-grant opposition. He explained that the applicant for a patent has a right to appeal to the Appellate Board from an order of the Controller refusing the application or requiring the application to be amended. Further, he submitted that section 25 (1) of the Act does not confer on the Controller any power to refuse the grant of patent because of the wordings given therein that the Controller “shall, if requested by such person for being heard, hear him and dispose of such representation in such manner and within such period as may be prescribed”. Thus the counsel submitted that as per section 25 (1) of the Act and rule 55 (5) and (6) of the Rules, the respondent cannot refuse the grant of patent but he can only either uphold the objections made by the third party intervention opponent and refuse the grant of patent under section 15 of the Act or dispose of the representation by such person as irrelevant and grant the patent under section 43 of the Act. So on all principles, the refusal by the respondent has to be considered as refusal under section 15 of the Act and not as a refusal under section 25 (1) of the Act. Consequently, there arises an appeal to the appellants before the Appellate board as all refusal of patent under section 15 is appealable under section 117 A (2) of the Act. The counsel also stressed that the scope of section 25 (1) of the Act is limited only to the disposal of representation by such person by way of third party intervention opposition to the grant of patent and in case that person is aggrieved, he has the remedy to come again under section 25 (2) of the Act by way of post-grant opposition or in the alternative under section 64 of the Act by way of revocation of the patent before the Appellate Board. Whereas if the applicant is aggrieved under section 25 (1) of the Act, he has no remedy, unlike the position, that if the patent is opposed under section 25 (2) of the Act, wherein there is a provision for appeal if he is aggrieved. The counsel for the appellant also referred to the expression ‘simultaneously’ in rule 55 (6) of the Rules stating that the Controller of Patents has to do two things while disposing off the representation i.e, he may either reject the representation and grant the patent or accept the representation and refuse grant of patent on the application. This power of refusal of application has to be considered only under section 15 of the Act as there is a power to refuse which exists only under section 15 and nowhere in any other section of the Act. The counsel for the appellant also argued that if there is no provision for appeal against the refusal of patent under section 25 (1) by the respondent, there does not exist an opportunity for any remedy to the party aggrieved namely, the appellant herein. In fact he also referred to the Articles 41 and 62 of the TRIPS Agreement stating that the parties to a proceeding shall have an opportunity for review by a judicial authority against any official administrative decision. The counsel for the appellant also argued that the Patents (Amendment) Act, 2005 brought in a dichotomy between the pre-grant and post-grant opposition for the first time by introducing the post-grant opposition after the grant of patent. He also said that the amendment restricted the right of appeal only to the orders passed under pre-grant opposition to the Appellate Board. He further submitted that section 25 (1) of the Act deals only with the act of disposal of representation in the pre-grant opposition and hence limitation of right in appeal is in consonance with the Article 62 to the TRIPS Agreement which provides that there shall be no obligation to provide for appeal to an unsuccessful opponent where there are options for revocation and invalidation and the patent applicant's right to appeal against the decision rejecting his application under section 25 (1) is guaranteed under section 15 of the Act because of the power vested in the Controller to refuse an application is only under section 15 and nowhere else in the Act. Finally the counsel prayed that the appeal may be held as maintainable as the order rejecting the patent application under section 25 as if it is an order passed under section 15 of the Act.
5. We have heard the counsel for the appellant. This appeal is before us for consideration as to its maintainability before this Appellate Board. Let us look at the provisions of section 25(1) of the Act, which is reproduced below:—
“25. (1) Where an application for a patent has been published but a patent has not been granted, any person may, in writing, represent by way of opposition to the Controller against the grant of patent on the ground—
(a) that the applicant for the patent or the person under or through whom he claims, wrongfully obtained the invention or any part thereof from him or from a person under or through whom he claims;
(b) that the invention so far as claimed in any claim of the complete specification has been published before the priority date of the claim—
(i) in any specification filed in pursuance of an application for a patent made in India on or after the 1 st day of January, 1912; or (ii) in India or elsewhere, in any other document:
Provided that the ground specified in sub-clause (ii) shall not be available where such publication does not constitute an anticipation of the invention by virtue of sub-section (2) or sub-section (3) of section 29;
(c) that the invention so far as claimed in any claim of the complete specification is claimed in a claim of a complete specification published on or after the priority date of the applicant's claim and filed in pursuance of an application for a patent in India, being a claim of which the priority date is earlier than that of the applicant's claim;
(d) that the invention so far as claimed in any claim of the complete specification was publicly known or publicly used in India before the priority date of that claim.
Explanation —For the purposes of this clause, an invention relating to a process for which a patent is claimed shall be deemed to have been publicly known or publicly used in India before the priority date of the claim if a product made by that process had already been imported into India before that date except where such importation has been for the purpose of reasonable trial or experiment only;
(e) that 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 applicant's claim;
(f) that the subject of any claim of the complete specification is not an invention within the meaning of this Act, or is not patentable under this Act;
(g) that the complete specification does not sufficiently and clearly describe the invention or the method by which it is to be performed;
(h) that the applicant has failed to disclose to the Controller the information required by section 8 or has furnished the information which in any material particular was false to his knowledge;
(i) that in the case of convention application, the application was not made within twelve months from the date of the first application for protection for the invention made in a convention country by the applicant or a person from whom he derives title;
(j) that the complete specification does not disclose or wrongly mentions the source or geographical origin of biological material used for the invention;
(k) that the invention so far as claimed in any claim of the complete specification is anticipated having regard to the knowledge, oral or otherwise, available within any local or indigenous community in India or elsewhere, but on no other ground and the Controller shall, if requested by such person for being heard, hear him and dispose of such representation in such manner and within such period as may be prescribed.”
Here the Controller is bound to look in to the representation made by the third party to the grant of a Patent and dispose of such representations in the manner as prescribed under the rule 55 (5) and (6) of the Rules. Here there are two parties involved in the proceedings before the Controller, viz., the applicant for the Patent and the third party intervention opponent opposing the grant of Patent to the applicant. The Controller of Patents being the custodian of Patent rights, has to do justice to both the parties while discharging his duties by disposing off the representation in accordance with the procedure laid down in the rule 55(6) of the Rules. First if the third party intervention opponent has requested for a hearing, then the Controller has to consider the representations made before him and call for the observations of the applicant, seeking the amendments in the specification to his satisfaction and if necessary hear both the parties. Then the Controller has to do one of the following actions, within the time specified therein,
i) either reject the representations and grant the Patent, or
ii) accept the representation and refuse to grant the Patent.
This refusal of Patent grant is in consequence to the filing of opposition to the grant of Patent by a third party intervention opponent. The whole action takes place under the purview and jurisdiction of section 25(1) of the Act. Either of the party aggrieved has no right for appeal and the Legislature has partly provided a remedy for the opponent (if he is aggrieved) to come again under section 25(2) of the Act, but by proving his interest in the opposition proceedings i.e, locus standi to show that he is a person interested in the said proceedings, otherwise he cannot oppose the grant of Patent, just like that what he did under the section 25(1) of the Act. In fact as to how and when the Controller has to consider the representation, is also given in the rule 55(2) of the Rules. Hence it is very clear, when the application for Patent is filed and published under section 11A of the Act, after only a request for the examination of the application is filed, the Controller may consider these representation made by the third party intervention opponent. Whereas the provisions of section 15 of the Act are different as seen below:—
“15. Power of Controller to refuse or require amended applications in certain case.-Where the Controller is satisfied that the application or any specification or any other document filed in pursuance thereof does not comply with the requirements of this act or of any rules made thereunder, the Controller may require the application, specification or other document, as the case may be, to be amended to his satisfaction before he proceeds with the application or refuse the application on failure to do so.”
6. Here in this proceeding under section 15 of the Act, there is only the applicant for Patent and the Controller of Patents and none else. So the office requirements may be technical or formal, which has to be complied with by the applicant and in the case of non-compliance of those requirements, the Controller of Patents has the authority and power to direct the applicant to amend the specification to his satisfaction or else refuse the application on failure to comply with the directions. After this stage is passed here comes the second stage, when there is a third party intervention opposition under section 25 (1), the Controller of Patents sends those representations after having considered them, for the notice and compliance of any requirement by the applicant. Naturally the result of this proceeding under section 25(1), cannot be same and similar to those under section 15 of the Act. So when the Controller of Patents accepts the representation of third party intervention opposition, he refuses to grant the Patent. Naturally he has to pass an order under section 25(1) of the Act and not under section 15 of the Act.
7. Considering the provisions of law and the arguments put forth by the learned counsel for the appellants, the learned counsel's contention is that this Appellate Board should consider the impugned order of the Controller of Patents, dated 27.03.2009 as a refusal order under section 15 of the Act, thus taking this appeal as maintainable under section 117 (A) (2) of the said Act. The respondent has issued the order dated 27.3.2009 stating that the application for Patent had been refused under the provisions of section 25 (1) of the said Act. The action taken by the Controller of Patents to issue an order under section 25(1) of the Act is entirely different from an order under section 15 of the Act refusing to grant a patent.
8. In view of the above, we are of the considered opinion that this appeal cannot be taken as an appeal against an order under section 15 of the Act, treating the impugned order of the respondent dated 27.03.2009 as an order of refusal under section 15 of the Act.
9. Hence, we uphold the office objection and consequently this appeal is dismissed as not maintainable.
(Disclaimer: This order is being published for present information and should not be taken as a certified copy issued by the Board.)
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