In Signal Pharmaceuticals vs Deputy Controller of Patents, the Madras High Court set aside the impugned order by the Indian Patent Office for being a non-speaking one. Analysing the Court’s decision, Bharathwaj discusses when an order is regarded as non-speaking and assesses the probable reasons for such orders. Bharathwaj is a 3rd year LLB Student at RGSOIPL, IIT Kharagpur, and loves books and IP. His previous posts can be accessed here.
Another day, Another Unreasoned Order by the Indian Patent Office: Analyzing Signal Pharmaceuticals vs Deputy Controller
By Bharathwaj Ramakrishnan
Recently, the Madras HC in Signal Pharmaceuticals vs Deputy Controller of Patents quashed the 2019 order of the Controller for being a non-speaking one. In this post, first, I will discuss the judgment in brief, then I will discuss the previous instances wherein the Patent Office has been taken to task by the Courts for issuing unreasoned orders. I’ll later discuss the factors that determine when an order is declared by the Court as an unreasoned or a reasoned order. Finally, I touch on probable factors that might be the reasons for the Controllers to be passing such unreasoned or non-speaking orders.
Summary of the Judgement:
The suit Patent in question was titled “mTOR kinase inhibitors for oncology indications and disease associated with the mTOR/P13K/AKT Pathway” (3500/CHENP/2011). The Controller had issued a rejection order stating that the invention was barred by Section 3(d) (bar against evergreening of Patents) and had not satisfied Section 2(1)(ja) (inventive step). The challenge to the Order by the appellant was premised on 7 points, which can be broadly summarized as the Controller passing an order without taking into account the arguments and evidence presented by the applicant with regard to the invention having an inventive step and not being barred by Section 3(d).
The applicant premised his arguments against the Order on three specific points. The appellant challenged the Controller’s conclusions with regards to the inventive step; invention being barred under Section 3(d); And finally, the most important one for our purposes, the order issued by the Controller was unreasoned as it did not consider all the submissions made by the appellant and that it showed non-application of mind by the Controller.
The Court did not decide the substantial issues of the inventive step and the invention being barred under Section 3(d) but decided that the Order issued by the Controller was unreasoned as he did not take into account the submissions made by the applicant which showed non-application of mind. Consequently, the Court referred the matter back to the Indian Patent Office for fresh consideration. With the case discussed in brief, it’s also necessary and useful to look at previous instances wherein the Courts have come down hard on the Patent Office for issuing unreasoned orders.
Unreasoned Orders and the Patent Office:
The Courts have taken the Patent office to task for issuing non-speaking orders or, in other words, orders that do not speak for themselves nor provide reasons as to why they have reached specific conclusions concerning the Patent application. The Courts have treated the Patent Office as a quasi-judicial authority and hence are understood to have an obligation to ensure natural justice (see here for a wonderful paper written by Prof. Basheer on this issue)
The most recent Delhi HC judgements where the Court has been highly critical of unreasoned orders are Blackberry vs Assistant Controller of Patents (pdf) and Dolby International vs Assistant Controller of Patents (discussed here). In both cases, the Court took a magnifying glass to the rejection order and analyzed and parsed it in search of some reasoning behind the order, but it failed to find much. In Ulm University v. Assistant Controller of Patents (discussed here), the Madras HC concluded that the Controller had issued a cryptic order wherein the Controller without discussing the prior arts concluded that the appellant’s invention lacked an inventive step. Likewise, in Sakata vs Controller of Patents (discussed here), the Madras HC also remanded the case to the Patent Office as the order in question was unreasoned. The Controller, even though he acknowledged that human intervention was involved, concluded that the process claimed to be an essentially biological process but did not give any reasons why he thought so. Later, the issue was examined again and rejected, but this time, the Controller gave reasons and relied on EPO case laws to back his conclusions. It must be pointed out to the readers that there are other instances wherein the HCs have quashed orders as being unreasoned (see here, here).
How Does the Court Conclude Whether an Order is Reasoned or Not?
As discussed above, the courts have taken to task the Patent Office whenever it concluded that the Order passed by the Controller was an unreasoned order or a non-speaking order. It also makes one wonder- when an order is deemed to be unreasoned? The answer to the question might be answered if one looks at the cases (discussed above) and a post written by Prashant Reddy T. (see here). It shows how, for the orders passed by the Controller to be a speaking order, reasons need to be provided as to why a certain conclusion was reached, and also shows how citing relevant judicial precedent can save the order from being declared unreasoned (Sakata case discussed above is a good example). To illustrate this, if an invention is to be objected to as being barred by Section 3(k), it would be necessary to cite the relevant precedent post-Farid Allani (all the developments surrounding Section 3(k) have been discussed in the blog here) and citation and discussion of the same might save the order from being declared as being unreasoned. It is important to note that other countries’ patent offices, such as EPO and UKIPO, are abreast of all the developments in case law (see here and here). It’s not a coincidence that the order that the Madras HC quashed does not cite any case law, and that of the 38-page order, only the last two pages of the order tried to address the arguments raised by the applicant and which, in the end, was found to be insufficient reasoning by the Court. Likewise, inadequate reasoning for rejecting a patent granted in other countries has been grounds on which the order has been set aside (for example, see here).
It must be noted at this juncture that there are instances wherein the Controller has issued well-reasoned orders. To quote a recent example, detailed orders have been issued by the Assistant Controller concerning the patent of addition, which included referencing the Ayyangar Committee report (discussed here). Likewise, there are also instances wherein the Court’s reasoning on an issue has been the subject of intense criticism (for courts being criticized for over-broad injunctions see here, here, and here). Thus, lack of reasoning is not a problem just faced by the Patent Office.
In conclusion, it is safe to say when the Order cites relevant judicial precedent, provides reasoning to the conclusions it has reached, and takes into account the prosecution history in other jurisdictions, there are high chances it would not be declared as an unreasoned order. With the precedents surrounding unreasoned orders discussed one wonders what might be causing the Controllers to issue such unreasoned orders.
Overwork, Quotas and the Nature of Legal Training Provided?
Praharsh, in his post (here), discusses the WIPO report and how the Patent Office officials might be overburdened. There have been instances that have been recorded and discussed in the blog wherein it has been noted that the number of orders issued by the Patent Office for a particular month increased drastically from previous years without any considerable increase in manpower (see here). It has been noted in the blog how examiners are caught between a rock and a hard place, wherein they are held responsible for their exalted position as a quasi-judicial authority. At the same time, performance quotas prevent them from meeting these exalted expectations (see here, here for a detailed post discussing the issues with performance quotas). Lastly, all these unreasoned orders, which the Court is quashing, are also partly due to the lack of reference or discussion of case laws that raises questions as to the type and manner of legal training that is being provided to the Controllers (readers can shed some light on this aspect if they’d like in the comments). Thus, it is essential to recognize that the Courts will hold the Patent Office accountable for its quasi-judicial status, and it’s time for the Patent Office to up its game and live up to its expectations.
The author wishes to thank Swaraj for his valuable input.