Symed Laboratories Pvt. Ltd. v. Sharon Bio-Medicine Ltd.
2014-09-10
G.P.MITTAL
body2014
DigiLaw.ai
JUDGMENT : G.P. Mittal, J. This application under Order VI Rule 17 of the Code of Civil Procedure, 1908 (CPC) has been moved by Defendant no. 3 (Mankind Pharma Limited) for amendment of the written statement. 2. A suit for permanent injunction restraining infringement of rights in Patents no. 213062 and 213063 titled 'Novel Intermediates for Linezolid and Related Compounds' and 'A Novel Process for the Preparation of Linezolid and Related Compounds' along with damages/ rendition of accounts, etc. was instituted by the Plaintiff against the Defendants with the allegations that the Plaintiff company is a well-known name in respect of manufacture and marketing of high profile Active Pharmaceutical Ingredients. It is the case of the Plaintiff that Linezolid is a synthetic antibiotic used for the treatment of serious infections caused by gram-positive bacteria that are resistant to several other antibiotics. Linezolid is a member of the oxazolidinone class of drugs and has the chemical name N - [ [ (5S) - 3 - [3 - fluoro - 4 - (4 - morpholinyl) phenyl] - 2 - oxo - 5 - oxazolidinyl] methyl] acetamide. Linezolid is marketed by Pfizer under the tradenames Zyvox (in the United States, United Kingdom, Australia and several other countries), Zyvoxid (in Europe) and Zyvoxam (in Canada and Mexico). Linezolid is protected by various patents in all major countries worldwide, for example by US Pat no. 5,688,792 (Expiry date: May 18, 2015) in the United States and by EP Patent no. 0717738B1 in the European Convention by Pfizer. However, as Linezolid is a pre - 1995 drug, thus, there does not exist a corresponding product patent qua Linezolid in India. 3. According to the Plaintiff, the Plaintiff developed two novel and inventive processes for preparation and commercial production of Linezolid. The Plaintiff, therefore, moved two applications bearing nos. 1592/ CHENP/ 2004 and 797/ CHENP/ 2004 in the patents office. The Plaintiff company was granted two different patents being IN 213062 and IN 213063 respectively. Details of the said patents as stated in para 12 of the plaint are extracted hereunder : Application number 1592/CHENP/2004 (PCT/IN2004/000218) 797/CHENP/2014 (PCT/IN2004/000105) Title ‘Novel intermediates for Linezolid and related compounds’ ‘A novel process for the preparation of Linezolid and related compounds’ Filing date 20.7.2004 19.4.2004 11A publication 29.4.2005 29.4.2005 Date of grant 19.12.2007 19.12.2007 Patent number IN 213062 IN 213063 4.
It is averred in the plaint that the various patents/ applications in respect of processes for preparation of Linezolid including those of the innovator, Pfizer suffered from various shortcomings and disadvantages which have been overcome by the Plaintiff by the processes patented above. 5. The Plaintiff states that the Plaintiff's rights in two patents are extremely valuable as the Plaintiff has spent large amount of money and time in inventing the process. It is averred that Defendants no. 2 and 3 are some of the customers of Defendant no. 1. It is further stated that Defendant no. 1 is involved in manufacturing of Active Pharmaceutical Ingredients for supply to its customers in domestic and international market. According to the Plaintiff, Defendants no. 2 and 3 are procuring Linezolid from Defendant no.1 which is manufactured by using the patented process of the Plaintiff. Thus, all the three Defendants are guilty of infringing the process of patents of the Plaintiff. 6. By an ex parte ad interim injunction order dated 01.06.2012, the Defendants through their directors, servants, agents, employees, franchisees and representatives or any one acting on their behalf were restrained from manufacturing the product Linezolid in any manner so as to result in infringement of the Plaintiff's registered patent IN213063. 7. By virtue of this application under Order VI Rule 17 CPC, Defendant no. 3 wants to amend para 1, newly add paras 2 and 3 and reframe para 2 with amendments as para 4 in the written statement, which for the sake of convenience are extracted hereunder from the chart provided by Defendant no. 3 : Original Written Statement Paragraph 1 The present suit preferred by the plaintiff thereby seeking relief of the nature against the parties as recited in the prayer of the body of suit, is a unique specimen of gross abuse of the process of Court particularly against answering Defendant no. 3 as there is no cause of action in favour of plaintiff against it as could be seen from a bare perusal of the averments made in the suit. Without indulging into the debate regarding the correctness of the claim of the plaintiff or without questioning its locus to present the present suit, it must be appreciated that the answering Defendant no.
Without indulging into the debate regarding the correctness of the claim of the plaintiff or without questioning its locus to present the present suit, it must be appreciated that the answering Defendant no. 3 is neither the manufacturer nor the producer of the product “Linezolid” nor is involved in any way, in its manufacturing activities, what to speak of using the process said to have been patented in favour of plaintiff. It is reiterated that since the product in question which is subject matter of the present suit is neither manufactured not sold by the answering Defendant no. 3 either using the process over which patent has been claimed by the plaintiff or any other process, the present suit is not only misconceived but misplaced as well. There is no gain saying in repeating the fact that an action of the nature as has been sought to be brought against the answering Defendant no. 3, can be maintainable against the entity which has been manufacturing, producing or selling the product by using the same process as has been claimed to be patented in favour of plaintiff but not against the answering Defendant no. 3 which is not engaged in any of the activities so as to give rise to suspicion of having infringed the statutory right of the plaintiff. Amended Written Statement Paragraph 1 The present suit preferred by the plaintiff thereby seeking relief of the nature against the parties as recited in the prayer of the body of the suit, is a unique specimen of gross abuse of the process of Court particularly against answering Defendant no. 3 as there is no cause of action in favour of plaintiff against it as could be seen from a bare perusal of the averment made in the suit. Without indulging into the debate regarding the correctness of the claim of the plaintiff or without questioning its locus to present the present suit, it must be appreciated that apart from Defendant’s manufactures purchasing Linezolid IP compound from the plaintiff himself the answering Defendant no. 3 is not using the process said to have been patented in favour of plaintiff. It is reiterated that since the product in question which is the subject matter of the present suit apart from Defendant’s manufactures purchasing Linezolid IP compound from the plaintiff himself is neither manufactured nor sold by the answering Defendant no.
3 is not using the process said to have been patented in favour of plaintiff. It is reiterated that since the product in question which is the subject matter of the present suit apart from Defendant’s manufactures purchasing Linezolid IP compound from the plaintiff himself is neither manufactured nor sold by the answering Defendant no. 3 either using the process over which patent has been claimed by the plaintiff or any other process, the present suit is not only misconceived but misplaced as well. There is no gain saying in repeating the fact that an action of the nature as has been sought to be brought against the answering Defendant no. 3, can be maintainable against the entity which has been manufacturing, producing or selling the product by using the same process as has been claimed to be patented in favour of plaintiff but not against the answering Defendant no. 3 which is not engaged in any of the activities so as to give rise to suspicion of having infringed the statutory right of the plaintiff. New paragraph 2 Defendant no. 3 is a marketer of its product namely LIZOFORCE that principally contain LINEZOLID IP a compound over which the Plaintiff purportedly claims to hold process patent rights. Defendant no. 3 purchases finished goods product duly manufactured by various manufacturers under its own brand name from the independent manufacturers subject to the terms and conditions contained in the agreement duly entered by and between Defendant no. 3 and said manufacturers. One of the manufacturers of Defendant no. 3 has been purchasing Linezolid IP from the plaintiff for at least 4 years. It would be pertinent to mention here that prior to filing the subjected suit the plaintiff at no point of time had disclosed to Defendant no. 3 or its manufacturer regarding their purported patents rights as claimed in the subjected suit. Few copies of invoices evidencing the purchase of Linezolid IP compound by the Defendant’s manufacturers are filed with the list of documents. New paragraph 3 The plaintiff filed not one but two identical suits before the same Hon’ble Court (the present suit and under number C.S. (OS) No. 1975 of 2012) against the Defendant with no invoices/ samples of the alleged impugned product annexed with the suit, claiming relieves simply in order to harass the Defendant no.
New paragraph 3 The plaintiff filed not one but two identical suits before the same Hon’ble Court (the present suit and under number C.S. (OS) No. 1975 of 2012) against the Defendant with no invoices/ samples of the alleged impugned product annexed with the suit, claiming relieves simply in order to harass the Defendant no. 3 with two separate proceedings that he purportedly claims to be different. In fact the two suits filed by the plaintiffs are word-by-word replica of another. The Defendant states that the act of filing two identical suits against the same Defendant is a gross abuse of process of law and an act of malafide that deserves the suits filed by the plaintiff to be void ab initio. Paragraph 2 The answering Defendant no. 3 has been engaged in manufacturing, producing and trading of various pharmaceutical products of different descriptions and varieties. It must be appreciated that during the course of its activities (manufacturing), answering Defendant no. 3 must have used the product either as an intermediary or as a constituent to the final product by purchasing the same from market including from Defendant no. 1. However it is reiterated that when a product is bought from the market, what is required to be looked into as to whether the entity selling such product is having the requisite license issued by the competent authority either to manufacture it or to sell it or not as it is neither practical nor possible nor required to ascertain and find out as to by which process the product in question has been manufactured and whether the manufacture is having a patent over it or some right so as to entitle it to produce the product in the particular manner i.e. by using the process. Moreover, it must be appreciated that at no such obligation, forget about statutory, has been cast so as to find out the process from the intending seller of the product before buying the same and to ascertain as to whether such seller has the right to manufacture the same with the said process. Admittedly, the complexity in such an exercise is so apparent that it makes the whole exercise impractical to the extent of being impossible in nature.
Admittedly, the complexity in such an exercise is so apparent that it makes the whole exercise impractical to the extent of being impossible in nature. Similarity in product can at least be, ascertained from a bare look but not the process particularly when such process is not disclosed on the packaging material of the product like other information. Hence to say that as the answering Defendant no. 3 purchased the product from Defendant no. 1 having been manufactured by using the process which infringed the right of the plaintiff, and therefore infringed the right of the plaintiff, is not only farfetched but imaginary in nature as well. New paragraph 4 The answering Defendant no. 3’s manufacturer has been engaged in manufacturing, producing and trading of various pharmaceutical products of different descriptions and varieties and procures such raw materials from various vendors including the plaintiff. It must be appreciated that during the course of its activities (manufacturing), answering Defendant’s manufacturers must have used the product either as an intermediary or as a constituent of final product by purchasing the same from the market including from Defendant no. 1 and the plaintiff that the Defendant claims to be non-infringing and the patents of the plaintiff are liable to be revoked under Section 64 of the Patents Act, 1970. However, it is reiterated that when a product is bought from the market, what is required to be looked into as to whether the entity selling such product is having the requisite license issued by the competent authority either to manufacture it or to sell it or not as it is neither practical nor possible nor required to ascertain and find out as to by which process the product in question has been manufactured and whether the manufacturer is having the patent over it or some rights so as to entitle it to produce the product in the particular manner i.e. by using the process. Defendant further asserts that even when the Defendant’s manufacture was the customer of the plaintiff and had bought the compound Linezolid from the plaintiff neither the manufacturer not the Defendant at any point was made to understand by the Plaintiff about the patented process of the compound.
Defendant further asserts that even when the Defendant’s manufacture was the customer of the plaintiff and had bought the compound Linezolid from the plaintiff neither the manufacturer not the Defendant at any point was made to understand by the Plaintiff about the patented process of the compound. Needless to say that any which ways the purported rights of the Plaintiff (which is disputed by the Defendant) are restricted only to the process of manufacturing of the compound and not the product Linezolid IP per se. Moreover, it must be appreciated that at no such obligation, forget about statutory, has been cast so as to find out the process from the intending seller of the product before buying the same and to ascertain as to whether such seller has the right to manufacture the same with the said process. Admittedly, the complexity in such an exercise is so apparent that it makes the whole exercise impractical to the extent of being impossible in nature. Similarly, a product can at least be, ascertained from a bare look but not the process the product like other information. In the list of documents filed along with the plaint relied by the plaintiff, the plaintiff has only annexed print-out of Defendant’s website and not the sample of the alleged infringing product itself. Hence to say that as the answering Defendant no. 3 purchased the product from the Defendant no. 1, having been manufactured by using the process which infringed the right of the Plaintiff, and therefore infringed the right of the Plaintiff, is not only farfetched but imaginary in nature as well. As it would be revealed from the annexed documents the samples disclosed by the plaintiff of the alleged impugned product upon inspection revealed that two of the three samples under batch number C8ALL030 and C8ALL026 were in fact products that were made out of the purchases by the Defendant’s manufacturer from the plaintiff himself. Hence the entire allegation of the plaintiff having conducted analytical test for comparison of the process is an act of fraud and an abuse of process, done deliberately by the Plaintiff in order to prejudice the Hon’ble Court against the Defendant.
Hence the entire allegation of the plaintiff having conducted analytical test for comparison of the process is an act of fraud and an abuse of process, done deliberately by the Plaintiff in order to prejudice the Hon’ble Court against the Defendant. The Plaintiff asserts that analytical test for comparison of the process was done between the Plaintiff’s products and his product only and that too at his own laboratories that has no authenticity, value or any meaning in the eyes of law. Paragraph 3 of Reply on merit In the circumstances, the Hon’ble Court may graciously be pleased to delete the name of answering Defendant no. 3 from the array of parties or dismiss the suit qua Defendant no. 3 in the facts of the case. Paragraph 3 of Reply on Merit In the forgoing circumstance it is humbly prayed that the Hon’ble Court may be pleased to:- i. Dismiss the suit with exemplary cost; ii. Delete the name of Defendant no. 3 from the Memorandum of Parties; iii. Revoke patents under number 213062 and 213063 granted in favour of the Plaintiff; iv. Award cost in favour of the Defendant no. 3; and v. Pass any other order as this Hon’ble Court may deem fit. 8. The reason given for carrying out the amendment in the written statement is that Defendant no. 3 is neither the manufacturer nor the producer of the product Linezolid. Defendant no. 3 is merely a marketer of its product, namely, LIZOFORCE that principally contains Linezolid IP, a compound over which the Plaintiff purportedly claims to hold process patent rights. Defendant no. 3 purchases finished goods product duly manufactured from various independent manufacturers under its own brand name subject to the terms and conditions contained in the agreement duly entered between Defendant no. 3 and the said manufacturers. Defendant no. 3 also facilitates supply of raw materials to its manufacturers. According to Defendant no. 3, its manufacturers had been purchasing Linezolid IP compound from various sources including the Plaintiff. Defendant no. 3, therefore, wants to incorporate all these facts by way of amendment in the written statement. 9. The application is opposed by the Plaintiff primarily on the ground that Defendant no. 3 is attempting to resile from its admitted position in the written statement filed on record. According to the Plaintiff, Defendant no.
Defendant no. 3, therefore, wants to incorporate all these facts by way of amendment in the written statement. 9. The application is opposed by the Plaintiff primarily on the ground that Defendant no. 3 is attempting to resile from its admitted position in the written statement filed on record. According to the Plaintiff, Defendant no. 3 originally admitted to being the manufacturer of Linezolid finished formulations and has now claimed that it uses independent manufacturers to prepare the finished products. It is urged that the amendment sought is malafide and Defendant no. 3 is trying to get out of the contempt application filed by the Plaintiff against the Defendants. It is urged that Defendant no. 3 has been consistently shifting its stand in the written statement filed in defence to the suit by way of frivolous applications, the earlier application being I.A. No. 18150/ 2013 moved for amendment of the written statement and withdrawn by it and the second application being the present one under Order VI Rule 17 CPC which is the subject matter of this order. The sum and substance of the opposition to the application for amendment is that Defendant no. 3 cannot withdraw its admission and cannot be permitted to set up a new case. 10. The learned Senior Counsel for the Plaintiff has referred to Modi Spinning and Weaving Mills Co. Ltd. and Another Vs. Ladha Ram and Co., AIR 1977 SC 680 to urge that the amendment of written statement seeking to displace the Plaintiff from the admission made by the Defendant in the written statement is not permissible. The learned Senior Counsel also relies upon Gautam Sarup Vs. Leela Jetly and Others, (2008) 7 SCC 85 , S. Malla Reddy Vs. Future Builders Co-operative Housing Society and Others, AIR 2013 SC 3693 and Kali Charan Vs. Ishwar Dass, (2001) 93 DLT 304 to urge that even if a Defendant may be permitted to take an inconsistent plea or alternative pleas in his defence, yet a Defendant cannot be permitted to withdraw any admission made in favour of the Plaintiff. 11. It is, no doubt, true that an admission cannot be permitted to be withdrawn by a party to the lis.
11. It is, no doubt, true that an admission cannot be permitted to be withdrawn by a party to the lis. In Gautam Sarup (supra) relied upon by the learned Senior Counsel for the Plaintiff, the law with regard to withdrawal of admissions was examined in great detail and referring to Union of India (UOI) Vs. Pramod Gupta (D) by L.Rs. and Others, AIR 2005 SC 3708 , the Supreme Court held as under : "23. Yet again in Union of India v. Pramod Gupta this Court held: "134. .... Before an amendment can be carried out in terms of Order 6 Rule 17 of the CPC the court is required to apply its mind on several factors including viz. Whether by reason of such amendment the claimant intends to resile from an express admission made by him. In such an event the application for amendment may not be allowed. (See Modi Spg. and Wvg. Mills Co. Ltd. v. Ladha Ram and Co., Heeralal v. Kalyan Mal and Sangramsinh P. Gaekwad v. Shantadevi P. Gaekwad.)" 12. At the same time, the Supreme Court held that where the admissions are not withdrawn but additional facts are stated which need to be proved, the amendment can be allowed. It was also stated that in a given case, an admission may be explained or clarified. In paras 27 to 29 in Gautam Sarup (supra), the Supreme Court held as under : "27. Recently, in Usha Balashahed Swami v. Kiran Appaso Swami this Court observed: "26. Therefore, it was neither a case of withdrawal of admission made in the written statement nor a case of washing out admission made by the appellant in the written statement. As noticed herein earlier, by such amendment the appellant had kept the admissions intact and only added certain additional facts which need to be proved by the plaintiff and Defendants 2 to 8 to get shares in the suit properties alleged to have been admitted by the appellants in their written statement. Accordingly, we are of the view that the appellants are only raising an issue regarding the legitimacy of the plaintiff and Defendants 3 to 7 to inherit the suit properties as heirs and legal representatives of the deceased Appasao.
Accordingly, we are of the view that the appellants are only raising an issue regarding the legitimacy of the plaintiff and Defendants 3 to 7 to inherit the suit properties as heirs and legal representatives of the deceased Appasao. Therefore, it must be held that in view of our discussions made hereinabove, the High Court was not justified in reversing the order of the trial court and rejecting the application for amendment of the written statement." 28. What, therefore, emerges from the discussions made hereinbefore is that a categorical admission cannot be resiled from but, in a given case, it may be explained or clarified. Offering explanation in regard to an admission or explaining away the same, however, would depend upon the nature and character thereof. It may be that a defendant is entitled to take an alternative plea. Such alternative pleas, however, cannot be mutually destructive of each other. 29. An explanation can be offered provided there is any scope therefor. A clarification may be made where the same is needed." 13. Turning to the facts of this case, it is nowhere the case of the Plaintiff that Defendant no. 3 (applicant herein) is the manufacturer of Linezolid. On the other hand, the case of the Plaintiff itself had been that Defendants no. 2 and 3 are procuring the Linezolid from Defendant no. 1 which is being manufactured (by Defendant no. 1) by using the patented process of the Plaintiff. Para 23 of the plaint is extracted hereunder : "23. It is most respectfully submitted that the Defendant no.1, Sharon Bio-Medicine Limited is a Company which is involved in the manufacture and supply of APIs (Active Pharmaceutical Ingredients) for several of its customers in pharmaceutical sector both internationally and domestic. The Defendant no. 2, Alken Laboratories Limited is one of the customers of the Defendant no.1 and is involved in the manufacture, supply and marketing of generics and branded formulations. The Defendant no. 3, Mankind Pharma Limited is another customer of the Defendant no. 1 and is involved in the manufacture, supply and marketing of various pharmaceutical formulations. It is humbly submitted that both the Defendants no. 2 and 3 are procuring Linezolid from Defendant no. 1, which is manufactured by using the patented process of the Plaintiff.
The Defendant no. 3, Mankind Pharma Limited is another customer of the Defendant no. 1 and is involved in the manufacture, supply and marketing of various pharmaceutical formulations. It is humbly submitted that both the Defendants no. 2 and 3 are procuring Linezolid from Defendant no. 1, which is manufactured by using the patented process of the Plaintiff. As a result, the Defendants are guilty of infringing the process patents which are the subject of the present suit inasmuch as no license/permission has been sought by either of the Defendants from the Plaintiff for using the patented processes for production and manufacture of Linezolid." 14. Thus, the case of the Plaintiff itself had been that Defendants no. 2 and 3 were infringing the Plaintiff's patented process because they were procuring Linezolid from Defendant no. 1 which Defendant no. 1 was manufacturing by using patented process. In para 2 of the written statement, Defendant no. 3 stated as under : "2. The answering defendant no. 3 has been engaged in manufacturing, producing and trading of various pharmaceutical products of different descriptions and varieties. It must be appreciated that during the course of its activities (manufacturing), answering defendant No.3must have used the product either as an intermediary or as a constituent to the final product by purchasing the same from market including from defendant no. 1. However, it is reiterated that when a product is bought from the market, what is required to be looked into as to whether the entity selling such product is having the requisite license issued by the competent authority either to manufacture it or to sell it or not as it is neither practical nor possible nor required to ascertain and find out as to by which process the product in question has been manufactured and whether the manufacturer is having a patent over it or some right so as to entitle it to product the product in the particular manner i.e. by using the process....." 15. Thus, in para 2, the sum and substance of the defence of Defendant no. 3 was that : (a) Linezolid was being used by Defendant no. 3 as a constituent in its final product; and (b) the product Linezolid was being purchased from the market and Defendant no.
Thus, in para 2, the sum and substance of the defence of Defendant no. 3 was that : (a) Linezolid was being used by Defendant no. 3 as a constituent in its final product; and (b) the product Linezolid was being purchased from the market and Defendant no. 3 was not expected to inquire the process of manufacturing Linezolid from the vendor but was only expected to see if it has a requisite licence to sell the product. 16. In para 1 of the preliminary objections of the written statement, it had been specifically stated by Defendant no. 3 that it was neither manufacturing Linezolid nor was, in any way, involved in its manufacturing activity. Therefore, the admission made by Defendant no. 3 that the product Linezolid was purchased by it at times for being used as a constituent from the market including Defendant no. 1 is a categorical admission and the same cannot be permitted to be withdrawn. At the same time, Defendant no. 3 cannot be prohibited from making an averment that Defendant no. 3 is getting LIZOFORCE manufactured from various manufacturers subject to the terms and conditions of the agreement between Defendant no. 3 and the said manufacturers and that one such manufacturer of Defendant no. 3 had been purchasing Linezolid IP from the Plaintiff for at least four years. 17. Thus, the application under Order VI Rule 17 CPC is partly allowed by permitting the amendment sought except that Defendant no. 3 cannot be permitted to withdraw the admission that "answering defendant no. 3 must have used the product either as an intermediary or as a constituent to the final product by purchasing the same from market including from defendant no. 1". But, it is permitted to state that "its manufacturers must have used the product either as an intermediary or a constituent of final product by purchasing the same from the market including Defendant no. 1 and the Plaintiff". Accordingly, while making amendment in the plaint, Defendant no.3 shall specifically state the earlier admission and then make the amendment sought. 18. Let amended written statement in terms of this order be filed within four weeks.