Delhi High Court
Symed Laboratories Pvt. Ltd. vs Sharon Bio-Medicine Ltd. And Ors. on 10 September, 2014
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Pronounced on: 10th September, 2014
+ I.A. No. 3159/ 2014 (Order VI Rule 17 CPC in CS (OS) No. 1797/
2012)
SYMED LABORATORIES PVT. LTD. ..... Plaintiff
Through: Mr. Gopal Jain, Senior Advocate with
Ms. Shwetasree Majum, Advocate and
Mr. Prithvi Singh, Advocate.
versus
SHARON BIO-MEDICINE LTD. AND ORS. ..... Defendants
Through: Ms. Rajeshwari H., Advocate for
Defendant no. 3.
Ms. Sunita K. Sreedharan, Advocate
for Defendant no. 1.
CORAM:
HON'BLE MR. JUSTICE G.P. MITTAL
1.
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 1592/CHENP/2004 797/CHENP/2014
number (PCT/IN2004/000218)
(PCT/IN2004/000105)
Title 'Novel intermediates for 'A novel process for
Linezolid and related the preparation of
compounds' 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 IN
213063.
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 Amended Written Statement
Paragraph 1 Paragraph 1
The present suit preferred by the The present suit preferred by the
plaintiff thereby seeking relief of plaintiff thereby seeking relief of
the nature against the parties as the nature against the parties as
recited in the prayer of the body recited in the prayer of the body
of suit, is a unique specimen of of the suit, is a unique specimen
gross abuse of the process of of gross abuse of the process of
Court particularly against Court particularly against
answering Defendant no. 3 as answering Defendant no. 3 as
there is no cause of action in there is no cause of action in
favour of plaintiff against it as favour of plaintiff against it as
could be seen from a bare perusal could be seen from a bare perusal
of the averments made in the suit. of the averment made in the suit.
Without indulging into the debate Without indulging into the debate
regarding the correctness of the regarding the correctness of the
claim of the plaintiff or without claim of the plaintiff or without
questioning its locus to present questioning its locus to present
the present suit, it must be the present suit, it must be
appreciated that the answering appreciated that apart from
Defendant no. 3 is neither the Defendant's manufactures
manufacturer nor the producer purchasing Linezolid IP
of the product "Linezolid" nor compound from the plaintiff
is involved in any way, in its himself the answering
manufacturing activities, what Defendant no. 3 is not using the
to speak of using the process process said to have been
said to have been patented in patented in favour of plaintiff.
favour of plaintiff. It is reiterated It is reiterated that since the
that since the product in question product in question which is the
which is subject matter of the subject matter of the present
present suit is neither suit apart from Defendant's
manufactured not sold by the manufactures purchasing
answering Defendant no. 3 either Linezolid IP compound from
using the process over which the plaintiff himself is neither
patent has been claimed by the manufactured nor sold by the
plaintiff or any other process, the answering Defendant no. 3
present suit is not only either using the process over
misconceived but misplaced as which patent has been claimed by
well. There is no gain saying in the plaintiff or any other process,
repeating the fact that an action of the present suit is not only
the nature as has been sought to misconceived but misplaced as
be brought against the answering well. There is no gain saying in
Defendant no. 3, can be repeating the fact that an action of
maintainable against the entity the nature as has been sought to
which has been manufacturing, be brought against the answering
producing or selling the product Defendant no. 3, can be
by using the same process as has maintainable against the entity
been claimed to be patented in which has been manufacturing,
favour of plaintiff but not against producing or selling the product
the answering Defendant no. 3 by using the same process as has
which is not engaged in any of the been claimed to be patented in
activities so as to give rise to favour of plaintiff but not against
suspicion of having infringed the the answering Defendant no. 3
statutory right of the plaintiff. 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. 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 New paragraph 4
The answering Defendant no. 3 The answering Defendant no. 3's
has been engaged in manufacturer has been engaged
manufacturing, producing and in manufacturing, producing and
trading of various pharmaceutical trading of various pharmaceutical
products of different descriptions products of different descriptions
and varieties. It must be and varieties and procures such
appreciated that during the course raw materials from various
of its activities (manufacturing), vendors including the plaintiff.
answering Defendant no. 3 must It must be appreciated that during
have used the product either as an the course of its activities
intermediary or as a constituent to (manufacturing), answering
the final product by purchasing Defendant's manufacturers must
the same from market including have used the product either as an
from Defendant no. 1. However it intermediary or as a constituent of
is reiterated that when a product is final product by purchasing the
bought from the market, what is same from the market including
required to be looked into as to from Defendant no. 1 and the
whether the entity selling such plaintiff that the Defendant
product is having the requisite claims to be non-infringing and
license issued by the competent the patents of the plaintiff are
authority either to manufacture it liable to be revoked under
or to sell it or not as it is neither Section 64 of the Patents Act,
practical nor possible nor required 1970. However, it is reiterated
to ascertain and find out as to by that when a product is bought
which process the product in from the market, what is required
question has been manufactured to be looked into as to whether the
and whether the manufacture is entity selling such product is
having a patent over it or some having the requisite license issued
right so as to entitle it to produce by the competent authority either
the product in the particular to manufacture it or to sell it or
manner i.e. by using the process. not as it is neither practical nor
Moreover, it must be appreciated possible nor required to ascertain
that at no such obligation, forget and find out as to by which
about statutory, has been cast so process the product in question
as to find out the process from the has been manufactured and
intending seller of the product whether the manufacturer is
before buying the same and to having the patent over it or some
ascertain as to whether such seller rights so as to entitle it to produce
has the right to manufacture the the product in the particular
same with the said process. manner i.e. by using the process.
Admittedly, the complexity in Defendant further asserts that
such an exercise is so apparent even when the Defendant's
that it makes the whole exercise manufacture was the customer
impractical to the extent of being of the plaintiff and had bought
impossible in nature. Similarity the compound Linezolid from
in product can at least be, the plaintiff neither the
ascertained from a bare look but manufacturer not the
not the process particularly when Defendant at any point was
such process is not disclosed on made to understand by the
the packaging material of the Plaintiff about the patented
product like other information. process of the compound.
Hence to say that as the Needless to say that any which
answering Defendant no. 3 ways the purported rights of the
purchased the product from Plaintiff (which is disputed by
Defendant no. 1 having been the Defendant) are restricted
manufactured by using the only to the process of
process which infringed the right manufacturing of the compound
of the plaintiff, and therefore and not the product Linezolid
infringed the right of the plaintiff, IP per se. Moreover, it must be
is not only farfetched but appreciated that at no such
imaginary in nature as well. 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. 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 Paragraph 3 of Reply on Merit
In the circumstances, the Hon'ble In the forgoing circumstance it is
Court may graciously be pleased humbly prayed that the Hon'ble
to delete the name of answering Court may be pleased to:-
Defendant no. 3 from the array of
i. Dismiss the suit with exemplary
parties or dismiss the suit qua
Defendant no. 3 in the facts of the cost;
case.
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. 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 & Weaving Mills Co. Ltd. and Another v. Ladha Ram & 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 v. Leela Jetly and
Others, (2008) 7 SCC 85, S. Malla Reddy v. Future Builders
Cooperative Housing Society and Others, (2013) 9 SCC 349 and Kali
Charan v. Ishwar Dass, 93 (2001) DLT 304 (DB) 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. 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 v. Pramod Gupta, (2005) 12 SCC 1, in para 23, 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 Code of Civil
Procedure 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. & Wvg. Mills Co. Ltd. v. Ladha Ram & 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. 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 & 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.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 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. 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.
(G.P. MITTAL)
JUDGE
SEPTEMBER 10, 2014
pst
