Bajaj Auto Limited Vs. TVS Motor Company Limited JT 2009 (12) SC 103
This is a landmark case in which the Hon’ble Supreme Court of India has laid down guidelines for all the lower courts and tribunals to carry on a speedy trial and deliver judgment quickly in matters relating to Intellectual Property Rights.
- A suit was brought up by the Bajaj Auto Limited before the Single bench of Madras High Court regarding infringement of its patent No.195904 relating to twin spark plug engine technology in the motor vehicles under the Indian Patents Act, 1973 ( hereinafter, ‘the Act’) against TVS Motor Company Limited.
- The suit filed was for the grant of permanent injunction against the respondents in order to restrain the infringement of monopoly rights granted to them through the Patent under the Act.
- During the pendency of suit, an application was made by the appellants to pass an interim injunction restraining the respondents from infringing the patent during the pendency of suit.
- The learned judge of Single bench passed an interim injunction restraining the respondent from making any further breach of appellant’s patent and thereby, interfering the launch of TVS Flame.
- The respondents filed an appeal against the impugned interim order before division bench of the said High Court.
- The division bench allowed the appeal.
- Thereafter the case was taken to Hon’ble Supreme Court of India through an SLP (Special Leave Petition) and had been put up in the court of Markandey Katju and Ashok Kumar Ganguly JJ..
- The defendants contended that there was no breach of the said patent and that they have been facing several threats for not launching TVS Flame.
- Respondents, in the meantime, also filed a suit against the Bajaj Auto Limited in Bombay High Court for defamation.
- Seven days before the launch of proposed bike TVS Motors filed an application to struck down the patent of the applicant.
- Later, even after all the ongoing proceedings; TVS Flame was launched in December 2007 without making any changes in the disputed design.
Issues raised by parties
There were several issues raised in the case which are as follows:
- Whether the Patent of the applicant was valid and still subsisting. The issue here was that the respondents had contended that the technology been used was a prior art as it had been previously used in US Honda Patent No. 4534322 dated 13th July 1985 and therefore the patent must not have been granted to them in the first place.
- Whether there were similarities in the design of TVS Flame with the patent of Bajaj Motors. It was contended by the respondents that where the applicant’s claim is for two spark plugs with two valves, the respondent’s design includes two spark plugs with three valves for which they held a license.
- Whether the grant of the injunction was necessary to protect the rights of the applicant under the statutory provisions. The respondents had contended that since the validity of patent application is a question still pending before the court, therefore, the applicant should not be entitled to an injunction.
- Whether the respondents were unjustly threatened only for the purpose of obtaining an unjust monopoly over the market.
The Hon’ble Supreme Court gave its decision on during the pendency of the suit for permanent injunction and laid down various guidelines to be followed by lower courts and tribunals to be followed during the trial of cases relating to patent,, copyright and trademark. It thereby criticised the current practice of courts and hence is treated as a landmark judgement relating to IPR.
The Hon’ble Supreme Court decided as follows:
- The Hon’ble court quashed the interim order passed by single bench and held that the respondents can continue selling their product in market provided they keep proper record of all India and export sales. A receiver had been appointed in this regard.
- The said decision was made on basis of the observation that if the exact combination was used as was patented, it would have led to infringement. But since improvements were made to the design there was no infringement.
- Judgement delivered in Improver Corporation and Ors. v. Remington Consumer Products and Ors was referred by the court in order to reach this decision.
- However, if improvement were claimed, it could not be done without paying proper price to the plaintiff for having used their design.
- The Hon’ble court further observed that in cases of infringement of patent trademark and copyright the parties the proceeding continues mostly for the order of interim injunction which should not be the case.
- Matters relating to infringement of IP rights involve many important aspects and therefore efforts should be made for speedy disposal of these matters.
- Also that hearings relating to IP matters should be done on day to day basis and should be resolved within two to three months.
- A direction was also passed for all the lower courts and tribunals to strictly and punctually comply with this direction of the Hon’ble court.