This article is written by Rishika Rathore, B.A., L.L.B student from the school of law, Jagran Lakecity University. This article deals with the brief patent laws and their infringement in the countries of India and the United States. It also highlights the case of LinkedIn and eBuddy Technologies.
Table of Contents
We are all familiar with the term “patent”. A patent is an exclusive legal right granted for inventing something brand new, or a new process to make something, or offering a new scientific method or solution to a problem. In a nutshell, every avant-garde gets legal protection called the patent. For example, the electric bulb is perhaps one of the most famous patented inventions known in the human world. It was accorded to Thomas Alva Edison in 1878.
To get a patent, all we need to do is disclose the technically correct information about the invention to the general public. In the principle of patent, the patent owner has the lawful right to prevent or restrict others from commercially making, using, distributing, importing, or selling the invention that has been patented, without the consent of the patent holder. If any person commits any such act as mentioned, it amounts to patent infringement. This article explores the patent rights in India and America, by taking the matter of LinkedIn and eBuddy Technologies into account.
Patent Law in India
In India, a patent is granted under the Indian Patent Act, 1970. A patent can be obtained only for an invention that is new and practical, provided under Indian patent laws. It confers absolute rights to the patent holder to prevent or restrict third parties from making, using, offering for sale, selling, or even importing, the patented invention to consume, sell, or offer for sale without the consent of the patent owner until the expiry date of said patent. Such laws are made to prevent third parties from commercially utilizing the patented invention. In India, a patent may also be obtained for the variation of an article or of a process of production.
In the case of drugs, medicines, and specific chemicals, no patent is granted for the substance itself, but a patent is granted for the process of manufacturing such substances. To get an assignment of the patent, the patent application must be true and then the patent will be assigned to the inventor or to the person who has obtained the title from that inventor. The term granted for every patent in India is 20 years from the date when the application was filled. However, for applications filed under the national phase, in terms of the Patent Cooperation Treaty (PCT), the term of a patent will be 20 years from the international date of filing provided under PCT.
Indian Patents Act, 1970
In earlier times, the patents in India were regulated by Act VI of 1856, to encourage the inventions of new and useful manufactures. Soon, the Act was nullified by Act IX of 1857 because the previous Act was enacted without the approval of the British Crown. After this, advanced legislative provisions like granting privileges only to convenient patents, extending the priority period from 6 months to 12 months, removing importers from the definition of an inventor, and modification of past legislations were enacted through Act XV of 1859. Since then, the Act was amended in 1872, 1883, and 1888.
The Patents Act 1970 came into existence on 20 April 1972, by taking the place of the Indian Patent and Design Act 1911. It came along with the Patent Rules 1972. It was based on the recommendations of the Ayyangar Committee. The recommendations included the allowance of patenting the process of inventing drugs, medicines, food, and chemicals. The provisions regarding patents again got modified by stretching patents on products, in all areas of technology including microorganisms, and provisions regarding exclusive market rights (EMR) get repealed. This modification amended the Act of 1970, naming it as the Patents (Amendment) Act, 2005. The patent system in India is now governed by the Patents Act, 1970 (No.39 of 1970) as amended by the Patents (Amendment) Act, 2005, and the Patents Rules, 2003. The Patent Rules are getting amended regularly, as per the requirements of the changing environment, the most recent being in 2016.
Criteria to obtain a patent in India
There are three fundamental steps for any invention to be patentable:
- The foremost step is to ensure that the invention is novel, implying that the invention must not have existed before, and at the time of invention.
- Further, the invention must not be obvious, i.e. the invention should be an advanced version of the previous one. Mere alteration in technology will not bag the virtuous patent to the inventor.
- Lastly, the invention must be useful in a bonafide manner, implying that the invention must not be consumed in any illegal task and should be useful to the public in a good-intended manner.
Section 3 and Section 4 of the Patent Act carry the information regarding the non-patentable subject matter. If the invention comes under these provisions of the non-patentable list, then it cannot be patented. Thus, the invention fits into the patentable subject matter list if it is novel, carries inventive and innovative steps, and is capable of industrial application.
The foremost criterion is the determination of the patent potential of an invention. Section 2(1) of the Act defines novelty. It implies that the subject matter should not fall into the public domain or should not be a part of the state of art.
Under Section 2(a) of the Patents Act, the term inventive step implies that the invention should not be apparent to any person’s skill in the same field of invention. It should not look easy to invent for a person who is skillful in the same genre.
Competent for industrial utilization
The patent must be capable of industrial implementation as defined in Section 2 (1)(ac) of the Patents Act. It implies that the invention can neither be symbolic nor philosophical. It must be competent to be applied in any industry and must have pragmatic utility in respect of the patents.
Disclosure of competent patent
Along with the above-mentioned statutory criteria for the patent of an invention, another important criterion for obtaining a patent is revealing the crux of a competent patent. It simply means that a draft of a patent’s specification must adequately reveal the invented particulars so that it can allow a person skilled in the same genre to invent something new rather than a patented invention.
Rights and obligations
Rights to patent holders
- Right to flaunt the patent: The owner of the patent has the right to consume, use, control, sell or distribute the patented subject or product in India. This exclusive right (Section 48 of the Patents Act 1970) can be exercised either by the patent owner or by his agent or licensees, whoever he has provided such rights to. But, these rights are exercisable only till the registered date of the patent.
- Right to transfer rights and permit license: As per Section 69(5) of the Patent Act, the owner of the patent has been provided with the option to transfer his rights, permit his licenses, or enter into an agreement for consideration with another person. A license or an agreement should be written, and registered with the Controller of Patents, in order to make such accord valid and lawful. If the document of transferring a patent is not registered, it will not be admitted as evidence of the title of any person and this applies to the person to whom the right has been legally transferred.
- Right to surrender the patent: As per Section 63 of the Patents Act, a patent holder has the right to give up his patent. Before the acceptance of surrender, a notice of surrender is provided to the person, whose name is registered while considering his objections. The application for surrender is also published in the official gazette, so that interested persons can withstand it.
- Right to file a suit for infringement: Above all the rights, the supreme advantage given to the patent holder is a right to institute proceedings for infringement of the patent, under Section 19 of the Act, in the District Court having jurisdiction for trial.
Obligations of patent holders
- Obligation to disclose – Section 8 of the Patent Act illustrates the obligation to disclose the patented invention. Section 8(1) of the Act, says that the patent holder must disclose all required data related to various relative or similar uses of inventions documented by him or through someone on behalf of him, during the application, or within 6 months of applying. Moreover, Section 8(2) of the Patent Act, 1970, puts another obligation on the owner of the patent, i.e. laying out all the data demanded by the Controller of Patents inside the term of 6 months, starting when the demand was made.
- Obligation to appeal for examination – As per the procedure that is mentioned above, it is the duty of the patent owner to ask for the Controller of Patents to examine the growth and development related to the patent, as recited by Section 11(B) of the Patents Act, 1970.
- The obligation of replying to objections – At the initial stage, the examination request has to face the person called analyst, who looks at the growth and then forwards it, known as the First Examination Report (FER). Afterward, this forwarded report is accepted by the Controller of Patent. In some cases, the analyst asks certain questions that get highlighted in the FER, and there comes the duty of the patent holder to respond to such oppositions and give his consent, within a year of issuance of FER. During that period, the application of the patent holder is said to be surrendered by the Controller of Patent.
- Obligation to pay statutory fees – Another obligation of patent holders is the payment of all the statutory expenses required to get a grant of a patent, failure of which can hinder the process of registration and application for the patent. The provisions relating to the payment of charges and the consequences for non-payment are given under Section 142 of the Patent Act, 1970.
Patent infringement proceedings can only be initiated after the grant of a patent in India. If the infringement has been done after the date of publication of the patent application, then also the proceedings can be initiated, including a claim retrospectively. Infringement of a patent comprises of the unauthorized producing, importing, consuming, offering for sale, or selling any patented invention within India. It is notable that only civil proceedings can be initiated in a court of law, given under the Indian Patents Act, 1970. Further, a suit for infringement can be defended on various grounds including the grounds that the disputed patent cannot be accorded in India, and based on such defense, revocation of the patent can also be claimed.
Activities that are regarded as infringing activities
The Patents Act of 1970 does not specifically list down the activities that could infringe the patent rights of the patent holder. However, Section 48 of the Act implies exclusive rights provided to the patent holder to prevent the third parties from using, making, offering for sale, or importing the patented invention with the mala fide to offer for sale in India, using or making without the willingness of the patent owner.
Therefore, it would be wise to presume that acts of the third parties which violated the rights granted to the patent holder, shall be considered as acts of infringement. It should be noted that third parties can use the patented inventions for commercial purposes by occupying a license from the patent holder, or by getting his appropriate consent for certain uses. Thus, any commercial use without the consent of the patent holder shall amount to infringement.
Activities regarded as non-infringing activities
There are particular activities under the Act, related to the patented invention, which are not reviewed as infringing activities, as per Sections 47, 49, and 107A. They are often regarded as statutory exemptions to infringement. The statutory exemptions to infringement are explained as follows:
- Government use – Certain conditions have been laid down in the provisions of Section 47 of the Patents Act, 1970, regarding the use of inventions by the government that is one of the statutory exemptions of infringement. Section 99 to 103 of the Patent’s Act, 1970, defines the meaning of the use of an invention by the government and the conditions for such use. Under the scope of Section 47, the government is authorized to use an invention anytime after filing the patent application or after the grant of patented rights by the patent holder. Furthermore, the government can also give a right to any person in writing, for using the invention for the purpose of using such invention. Along with this, the government has the right to make or import any invention for its own use. The scope of the government, under Section 47, was discussed in the case Garware Wall Ropes Ltd vs A.I. Chopra, Engineers and Contractors (2007).
- Exemptions for research and development – Section 47(3) of the Patents Act, 1970, highlights the provisions regarding consumption of the patented inventions, on the sole grounds of experiment, research, and for passing on the instructions to the public. Scientific researchers are allowed to use the patented invention to use such information for the advancement of science and social good. Moreover, the educational use of the patented invention also allowed for enriching the knowledge of students about the different genres of art. However, the sale of the patented products, giving the excuse of experimental study, will not fall under the limits of this statutory exemption. Such an act will be treated as an offense of infringement and the person selling the product for monetary gain. Moreover, using stolen or pirated articles for conveying instructions to the public will convert into an act of infringement.
- Supply of medicines and drugs to medical institutions of the government – The government has been provided with the permission to import the patented medicine or drug to either use it for their own self or to dispense the patented medicine or drug in dispensaries, medical institutions, or hospitals notified under the official gazette of the government, as per Section 47(4) of the Patents Act, 1970. This provision allows the government to establish a see-saw in the interest of the public to access healthcare and the exclusive rights granted to the patent holder. However, illegal monetary gains of patented medicines or drugs, without the consent of the patentee amounts to an offense of infringement.
Patent law in America
The grants of patents in the United States of America are governed by the Patent Act (35 U.S. Code) that established the United States Patent and Trademark Office (USPTO). The U.S. patent system was created by Article 1, Section 8, Clause 8 (1789), of the U.S. Constitution. The applicant has to submit a patent application to the USPTO, to obtain protection under U.S. law, where the application is reviewed by an examiner to determine if the invention is patentable or not. The U.S. law provides patent holders the right to restrict other persons from illegally making, using, or selling the invention. There are mainly three kinds of patents in the U.S. that are as follows:
- Utility patents – These patents are awarded for the running of a machine or device, also known as functional patents.
- Design patents – These patents are provided to protect any innovative, original, and ornamental design for a manufactured article, protecting the appearance of a product.
- Plant patents – These patents are provided to asexually produced plants.
Patent Act (35 U.S. Code)
The first United States Patent Act of 1790, was a pea-sized Act of only seven sections, titled “An act to promote the progress of useful arts.” In 1793, this little Act was repealed and stepped by a prolonged Act, whose grafting was largely suggested by Thomas Jefferson, the Secretary of State at that time, who was intimately involved in the administration of the 1790 Act. The 1793 Act constituted the list of rights of patent holders and the subject of patentable matters in the United States.
Again, it was amended in the 1800 Act that allowed foreigners to obtain patents, who were residing in the United States for two years. The only exception for foreigners was that they had to take an oath, telling them that the particular invention had never been used previously in the United States or abroad. In 1839, a provision was added that provided a grace period of two years for publicizing or using the invention, before filing a patent application. In 1930, the Plant Patent Act provided for the accessibility of patent protection for asexually reproduced plants. In 1940, the duration of the grace period was reduced from two years to one.
The foundation of the present patent law in the U.S. was initiated in 1952. The Intellectual Property and Communications Omnibus Reform Act of 1999 was passed that made several amendments to the U.S. Patent Law while including provisions for cutting down cybersquatting. The major changes to the U.S. Patent Law include the facility of early publication of patent applications, the protection of inventors, and the first inventor defense for primary users of business techniques. In 2000, the Patent and Trademark Office renamed itself the United States Patent and Trademark Office.
Rights granted to U.S. patent holders
Under U.S. Patent Authority, the patent holder has been provided with the right to eliminate others from building, consuming, selling, offering to sell, or importing the invention. Here, a patent does not provide the inventor with an exclusive right to manufacture or use an invention but protects his invention. For instance, if any invention came out as an advanced version of an existing invented patent, in such a case neither old nor new inventors acquire the right to make, use, or sell the entire invention. To do such acts, it is necessary to obtain a license from the prior owner of the invention.
When a person or entity builds, consumes, sells, offers to sell, or imports the invention without the prior permission of the patent holder, during its unexpired term, then it amounts to patent infringement.
In the United States, when imported goods are manufactured outside the country by a process patented in the United States, it also amounts to infringement. The infringement can be direct or contributory. When a person sells a particular component of a patented invention, it is regarded as contributory infringement. On the other hand, if a person induces another to perform an infringement, then such person is also considered to be an infringer. There are mainly two kinds of infringement that happen in the United States.
- Utility patent infringement: Monetary compensations for infringement comprise the lost profits allotted to the infringement or a reasonable royalty for the infringing goods or processes. Moreover, temporary or permanent injunctions are also available to restrict continuous infringements.
- Design patent infringement: Here, the infringer’s profits are one of the cures in hand, among the cases of design patent infringement. Along with this, design patent remedies can also be taken in lost profits and a reasonable royalty, along with fees of the attorney. When it comes to proving the infringement, an accused article is compared to all the designs and figures of the patent. This inspection must pass the “ordinary observer test“. Under this test, if an ordinary observer or purchaser has been defrauded by the confusion between the accused article with the patented design, then the design is said to be infringed. In such a case, the accused article need not be identical.
LinkedIn and eBuddy Technologies case
Plaintiff: eBuddy Technologies – It is a private limited company established under the Netherlands’ laws. eBuddy was created as an independent web browser-based instant messaging service like e-Messenger, founded in 2003. The company was rebranded in 2006 to eBuddy. eBuddy Chat works on platforms like Facebook Chat, MSN, Google Talk, Yahoo Messenger, ICQ, and AOL accounts to allow respective users to chat free of charge in one aggregated interface.
Defendant: LinkedIn Corporation- LinkedIn was initiated by co-founder Reid Hoffman in his living room in 2002. It was officially launched on May 5, 2003. Under the leadership of CEO Ryan Roslansky, LinkedIn is a leading app that integrates business by collecting revenues from membership subscriptions, advertising sales, and recruitment solutions.
In the District of Delaware, the United States, the plaintiff eBuddy Technologies B.V. filed a complaint against LinkedIn Corporation regarding the infringement of a patent. The company alleged that LinkedIn has infringed certain patents by the accumulation of contract and event notifications.
The patents in suit
The patents-in-suit were United States Patent Nos. 8,510,395 (the ’395 patent); 9,584,453 (the ’453 patent); 8,230,135 (the ’135 patent); and 8,402,179 (the ’179 patent). As per the allegations of eBuddy, the patents ’395 and ’453 stands for “accumulation of contract between different messaging services” and the patents ’135 and ’179 are for “event notifications.”
According to facts, LinkedIn has purportedly infringed at least claims 1 and 7 of the 395 patent by utilizing the patented “systems and methods for obtaining and aggregating contact information from a plurality of messaging services providers via LinkedIn’s LinkedIn Application system.”
The 395 patent simply comprises a structural process of communications between networks of messaging service providers. The plaintiff claimed that LinkedIn has infringed this technological method. According to claim 1 of the ‘395 patent of the U.S., the users were able to login into another network to import their contracts to LinkedIn to create an aggregate contract list. Moreover, the user was able to import and sync contacts from other services to create one contact list, infringing claim 7 of the ‘395 patent that comprises a method to join high-level networks.
In specifics, eBuddy Technologies stated that LinkedIn’s system includes the components described in the ’395 patent, while also using the technology described in the patent. Moreover, the plaintiff claimed that the “LinkedIn application permits a user to join multiple networks associated with respective messaging service providers which interact with, inter alia, APIs of LinkedIn and the other networks.”
The plaintiff claimed that LinkedIn users can import and sync contacts from various sources, such as phone contacts and a variety of email platforms, which are then allegedly used on LinkedIn. LinkedIn allegedly displays these contacts and allows a user to connect with said contacts on LinkedIn and to message these contacts on LinkedIn. Consequently, these aggregated contact lists from other sources and LinkedIn are imported, synced, and stored on LinkedIn.
The plaintiff has prayed for declaratory judgment in its favor, an award for damages, a permanent injunction, an award for costs and fees, and other relief. The case is still in process and is yet to have a conclusive ruling.
The 16th president of the United States, Mr. Abraham Lincoln once quoted -“the patent system added fuel of interest to the fire of genius”. Indeed, the patent laws have been acting as a backbone for all new inventions. If a person invents something new, he is relieved within his mind that the patent laws of his country are going to protect his respective invention. When patent infringement happens, the patent holder can sue the infringer or defendant to get relief in the appropriate court. Therefore, it would be right to conclude that the Patent Laws provide a safeguard to new inventions.
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