Telefonktiebolaget Lm ... vs Lava International Ltd
2016 Latest Caselaw 4339 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                 Order delivered on: 10th June, 2016

+                        CS(OS) No. 764/2015

       TELEFONKTIEBOLAGET LM ERICSSON(PUBL)          ..... Plaintiff
                     Through   Mr.Sandeep Sethi and Ms.Prathiba
                               M. Singh, Sr. Advs. with
                               Mr.Chander M. Lall, Ms.Saya
                               Choudhary Kapur, Mr.Ashutosh
                               Kumar, Ms.Meetali Agarwal,
                               Ms.Sutapa Jana, Mr.Rohin Koolwal,
                               Mr.Adithya Jayaraj, Mr.Devanshu
                               Khanna & Mr.Nikhil Chawla, Advs.

                         versus

       LAVA INTERNATIONAL LTD                             ..... Defendant
                      Through         Mr.Arun Kathpalia, Sr.Adv. with
                                      Mr.Jayant Mehta, Mr.Ashok
                                      Aggarwal, Mr.Swapnil Gupta,
                                      Mr.Shwetank Tripathi &
                                      Ms.Shivambika Sinha, Advs.
       CORAM:
       HON'BLE MR.JUSTICE MANMOHAN SINGH

MANMOHAN SINGH, J.

I.A. No.5470/2016 (under Section 151 CPC, by defendant)

1. By this order, I propose to decide the defendant's application filed under Section 151 wherein the following reliefs are sought :

a. Pass an order fixing a fresh schedule of trial giving fair, reasonable and proper opportunity to the defendant and the schedule proposed by the defendant may kindly be considered while fixing the said schedule. b. Allow the defendant to examine DW-3 Mr. Sunil Bhalla, the Director of the defendant after the examination of DW-1 in view of the circumstances explained in the application.

c. Leave be granted to the defendant that any additional document filed by or may be filed by it along with affidavit by way of evidence or otherwise may be directed to be taken on record. Leave in this regard may kindly be granted.

2. By order dated 2nd February, 2016, the following issues were framed:-

"1. Whether the plaintiff is owner of following patents:

i. IN 203034 titled as "Linear Predictive Analysis by synthesis encoding method and encoder"; ii. IN 203036 titled as "Apparatus of producing from an original speech signal a plurality of parameters";

iii. IN 234157 titled as "A method of encoding/decoding multi-codebook fixed bitrate CELP signal block";

iv. IN 203686 titled as "Method and system for alternating transmission of codec mode information";

v. IN 213723 titled as "Method and apparatus for generating comfort noise in a speech decoder"; vi. IN 229632 titled as "Multi service handling by a Single Mobile Station";

vii. IN 240471 titled as "A mobile radio for use in a mobile radio communication system"; viii. IN 241747 titled as "A transcieving omit unit for block automatic retransmission request."

2. Whether the defendant is infringing the abovesaid suit patents? OPP

3. Whether the counter-claims of the defendant is barred? OPP

4. Whether the abovesaid suit patents are invalid in nature and are liable to be revoked in the light of the grounds raised by the defendant in its counter claim? OPD

5. Whether the plaintiff is entitled to a decree declaring

that the rates offered by the plaintiff qua its portfolio of Standard Essential Patents are FRAND in nature as claimed? OPP

6. Whether the defendant is liable to be permanently injuncted from infringes the plaintiff's patents? OPP

7. Whether the plaintiff is entitled to damages or accounts the profits? If so, on what terms and for what period? OPP

8. Relief."

3. As the hearing in the injunction application was being continued, in order to show the bonafide, the defendant had handed over the proposed schedule of trial on 29th January, 2016:

             Stage                    Time Granted     Tentative Date

       1.    Submission of List of    10 days          10th February,
             Witnesses by the                          2016
             parties

       2.    Filing of Evidence by    4 weeks          9th March, 2016
             way of affidavits by
             the parties.

       3.    Recording of             4 weeks          23rd March, 2016
             Evidence and cross                        onwards and to be
             examination of           (About 2         concluded by 1st
             witnesses before         weeks each       May, 2016
             Commissioner             party)

       4.    Filing of written        2 weeks          15th May, 2016
             arguments by the
             parties

       5.    Commencement of                           To be fixed as per
             oral arguments                            convenience of the
                                                       Court.

4. After framing of the issues, on 22nd February, 2016, the following guidelines were laid down:-

".......

i. 4 weeks for filing evidence affidavits in affirmative by both the parties i.e. till 21st March, 2016 ii. Thereafter, cross-examination (8 hours per witness) i.e. 28th March, 2016-15th March, 2016; iii. Thereafter 2 weeks for filing rebuttal evidences i.e. 5th May, 2016;

iv. Thereafter, 2 weeks for cross-examination on rebuttal evidence, i.e. from 9th May, 2016 to 24th May, 2016.

v. Commencement of final argument from 30th May, 2016....."

5. It appears from the schedule of trial that the parties were granted time for filing of the rebuttal evidence on 5th May, 2016. The common evidence of parties is to be led by both parties in the suit, counter-claim and in the suit for declaration filed by the defendant.

6. The onus to prove issues No.1, 2, 3, 5, 6 & 7 lies on the plaintiff who has led evidence of the following four witnesses covering the aforesaid issues:-

       (i)     Mr.John Han - PW-1
       (ii)    Mr.Stefan Bruhn - PW-2 (Technical witness)

(iii) Dr.Jonathan Putnam - PW-3 (Expert witness on FRAND and Damages)

(iv) Mr.Mats Sagfors - PW-4 (Technical witness)

7. The list of witnesses filed by the defendant on 18th February, 2016 contain these witnesses namely:-

        Sl.      Name and Address                   Remarks
       No.

1. Sunil Bhalla, Founder Director, To prove the case of Lava International Ltd. the defendant in general and depose in rebuttal in relation to FRAND Negotiations and quantum of damages and all points of rebuttal that may arise.

2. Mr.GS Madhusudan, Senior To give expert Project Advisor/ Principal testimony on the suit Scientist with the Computer patents and their Architecture and Systems Lab, nature in respect of Reconfigurable and Intelligent issue 4 as framed by Systems Engineering (RISE) this Court and in Group, Department of rebuttal on issue 2.

                Computer       Science      and
                Engineering, Indian Institute of
                Technology, Madras

       3.       Dr.V.Kamakoti,        Professor, To      give   expert
                Department      of    Computer testimony on the suit
                Science     and     Engineering, and their nature in

Indian Institute of Technology, respect of issue 4 as Madras framed by this Court and in rebuttal on issue 2.

4. Such other witnesses as may be required in rebuttal

8. The defendant in affirmative evidence filed affidavits of two witnesses, namely, Mr.G.S. Madhusudan, Senior Project Advisor/Principal Scientist, IIT Madras and Dr.V. Kamakoti, Professor, Department of Computer Science and Engineering, IIT Madras. Copies of the said affidavits were served upon the plaintiff on 21 st March,

2016. These are the expert witnesses. After the conclusion of the evidence of DW-1, i.e. Mr.G.S. Madhusudan, the defendant did not produce second witness Dr.V. Kamakoti who is also an expert witness as evidence in affirmative. It was contended by the defendant that he was not available before 1st June, 2016. From time to time, the dates were fixed by the Court for recording his evidence, however, in the appeal, the Hon'ble Division Bench of this Court had allowed the said witness to be produced before the Court Commissioner for the purposes of tendering the evidence and cross-examination as affirmative evidence on 1st June, 2016 onwards for the purposes of recording of evidence.

9. Counsel for the defendant on 3rd May, 2016 has submitted that his client has filed additional list of witnesses which contained 7 more witnesses in addition to the previous three witnesses, however, the defendant would restrict to only 7 witnesses including three witnesses, the details of which are mentioned in the list of witnesses filed on 18 th February, 2016. A request was made to allow the defendant to file the affidavits by taking the list of witnesses on record. On 5th May, 2016, the defendant's counsel has handed over the details of fresh schedule for the cross-examination of additional witnesses, which would extend the trial beyond July/August, 2016.

10. It was alleged that heavy stake of the defendant is involved and being a technical matter, the defendant has now decided to produce four more expert witnesses in rebuttal evidence in response to the evidence of the plaintiff.

11. In the meanwhile, after recording of evidence of DW-1 Mr.G.S. Madhusudan, the defendant has filed the affidavit of Mr.Sunil Bhalla in affirmative as well as rebuttal evidence. As Dr.V. Kamakoti was not

available, Mr.Sunil Bhalla has tendered his affidavit and his cross- examination has been conducted in order save the time. The affidavit of Mr.Sunil Bhalla, Director of the defendant-Company has been filed as evidence in affirmative and rebuttal, as admitted by the defendant as well as contents of the evidence, such as, ETSI IPR Policy, Offers made by Ericsson, Similarly placed parties, FRAND rates, Damages and Non-infringement.

12. As a matter of fact, in the said list, the details of 10 witnesses are mentioned. However, as mentioned earlier, the witnesses no.7, 8 & 10 were given up by the learned counsel for the defendant. As far as the witness No.9 is concerned, i.e. Mediatek Inc. through its authorized representative, the learned counsel for the plaintiff has rightly pointed out that no details whatsoever are given by the defendant and even the said witness did not show his interest as per his e-mail to come and depose before this Court. In the absence of details, I am of the view that the witness no.9 of the list cannot be allowed. Even otherwise, specific name of the witness, his address and his designation in the company was not mentioned. It is submitted by the counsel for the defendant that the remaining three witnesses, i.e. at serial Nos.4, 5 & 6 are sought to be produced before Court for the purpose of tendering the evidence and cross-examination on behalf of the defendant. Their affidavits have not been filed. Time was granted to the defendant to file the signed scanned photocopies of the affidavits. However, despite of opportunity granted to the defendant, the defendant failed to file the same.

13. The said fact is also evident that all the three witnesses, namely, Mr.Madhusudan, Dr.Kamakoti and Mr.Bhalla are described as rebuttal

witnesses in the list of witnesses filed by the defendant, as is evidence from the following:-

Sunil Bhalla To prove the case of the defendant in general and depose in rebuttal in relation to FRAND Negotiations and quantum of damages and all points of rebuttal G.Madhusudan To give expert testimony on the suit patents and their nature in respect of issue No.4 as framed by this Court and in rebuttal on issue No.2.

V.Kamakoti To give expert testimony on the suit and their nature in respect of issue No.4 as framed by this Court and in rebuttal on issue No.2.

14. As per the order of the Division Bench dated 27th May, 2016 passed in FAO(OS) (COMM.) No.39/2016, the defendant has now also concluded the evidence of Dr.V. Kamakoti.

15. It is argued by the plaintiff that the defendant is now not entitled to produce any other witness as the defendant has already led both its affirmative and rebuttal evidence covering all the issues with the above three witnesses. Therefore, the question of producing the rebuttal/additional evidence does not arise, as in order to bring additional witnesses the defendant is trying to cover up the lacuna in the garb of additional or rebuttal evidence and to improve its own case after looking at the evidence of plaintiff's witnesses. It is submitted by the counsel for the plaintiff that such a right to produce witnesses is not permissible in law. On earlier two occasions, the Court directed the defendant in order to show its bonafide to file scanned copies of the affidavits in order to verify as to whether such evidence is necessary, so that the aspect of the alleged rebuttal evidence may be

considered but the defendant failed to file the same. It appears to the Court from the correspondences exchanged between the counsel for the defendant and the proposed witnesses that the witnesses were yet to be engaged by the defendant and no commitment had been given by the said persons to act as witnesses. In fact, a company like Mediatek stated that it may consider giving evidence in July. The defendant has not filed any such affidavits, rather an affidavit from the local person has been filed on its behalf, deposing that the said affidavits would be filed by 28th June, 2016 of these proposed witnesses as rebuttal evidence, although the copies of the emails exchanged with them would show them as proposed additional witnesses.

16. No doubt, it is apparent from record that the defendant has already filed evidence by way of affidavit of one Mr.Sunil Bhalla on 5 th May, 2016, i.e. after conclusion of cross-examination of the plaintiff's witnesses. Mr.Sunil Bhalla has deposed on the following aspects:-

- ETSI IPR Policy

- Offers made by Ericsson

- Similarly placed parties

- FRAND rates

- Damages

- Non-infringement All the aforesaid points relate to issues No.2, 5, 6, 7 & 8 which were framed by this Court and thus, the defendant has already filed its evidence in reply to the plaintiff's evidence. Further, DW-3 Dr.V.

Kamakoti has also led evidence qua non-infringement, i.e. issue No.2. The defendant now wishes to lead further evidence which is not permissible, as no new case is sought to be introduced by the plaintiff

inasmuch as the entire evidence has been led within the parameter of facts and conformities of the pleadings and as per the issues that have been framed. Mr.Bhalla DW-2 has already been cross-examined due to alleged unavailability of defendant's affirmative witness Dr.V. Kamakoti prior to 1st June, 2016.

17. It is a settled position of law that a party to the suit cannot proceed with the trial at its own liberty and pleasure and it must abide by the procedure prescribed by the Code, as held by the Supreme Court in the case of M/s Shiv Cotex v. Tirgun Auto Plast Pvt. Ltd. & Ors., SLP(C) No.30105/2010, the relevant paras of which are as under:-

".........

16. No litigant has a right to abuse the procedure provided in the CPC. Adjournments have grown like cancer corroding the entire body of justice delivery system.....

......The past conduct of a party in the conduct of the proceedings is an important circumstance which the courts must keep in view whenever a request for adjournment is made. A party to the suit is not at liberty to proceed with the trial at its leisure and pleasure and has no right to determine when the evidence would be let in by it or the matter should be heard. The parties to a suit - whether plaintiff or defendant - must cooperate with the court in ensuring the effective work on the date of hearing for which the matter has been fixed. If they don't, they do so at their own peril......"

18. It is also upheld in the case of Rasiklal Manikchand Dhariwal & Anr. v. M.S.S. Food Products, (2012) 2 SCC 196, that -

"......The parties must abide by the procedure prescribed in the Code and if they fail to do so, they have to suffer the consequences. As a matter of fact, the procedure provided in the Code for trial of the suits is extremely rational, reasonable and elaborate. Fair procedure is its hallmark.

The courts of civil judicature also have to adhere to the procedure prescribed in the Code and where the Code is silent about something, the court acts according to justice, equity and good conscience. The discretion conferred upon the court by the Code has to be exercised in conformity with settled judicial principles and not in a whimsical or arbitrary or capricious manner."

19. The submission of the learned Senior counsel appearing on behalf of the defendant is that the evidence of these witnesses is necessary in rebuttal. Counsel also submitted that when the schedule was framed with the consent of the parties, the opportunity was given to both parties for rebuttal evidence. The defendant in order to response the plaintiff, wishes to produce the rebuttal evidence in order to discharge its burden. He also states that the prayer of the defendant in the application is that the list of abovementioned witnesses be taken on record and one more opportunity be given to the defendant to produce the evidence by way of affidavit(s) on or before 28th June, 2016 and also the fresh schedule for tendering of evidence and cross-examination be fixed by this Court to be conducted in the month of July, 2016. The defendant undertakes that in case the affidavits of these three witnesses are not filed on or before 28 th June, 2016, the right to file the evidence of the defendant be treated as closed. Similarly, he makes the statement on behalf of the defendant that in case the witnesses are not present as and when the date fixed by the Court for the purpose of tendering the evidence and cross-examination, the evidence in rebuttal be closed.

20. Counsel further submits that in case the evidence of the defendant is recorded, the chance may be given to the plaintiff to produce the rebuttal evidence. He says that the rebuttal evidence means response to the evidence produced by the plaintiff. Even the

defendant has filed the counter claim which is to be treated as suit. Therefore, the defendant is entitled to give the response to the evidence of the plaintiff, as parties even otherwise received their right for rebuttal evidence when the schedule was fixed on 22nd February, 2016.

21. On the other hand, the learned Senior counsel appearing on behalf of the plaintiff has strongly opposed the prayer of the application. Counsel submits that the schedule was fixed by the Court for recording of evidence which is not adhered to by the defendant intentionally and deliberately. The defendant is playing all types of tricks to postpone the dates of final arguments. It is argued that there is no justification to produce the additional evidence, as affirmative/ rebuttal evidence has already been produced by the defendant by way of affidavit of Mr.Sunil Bhalla DW-2 whose evidence has already been recorded. Therefore, there is no need to record the similar evidence of other witnesses. Counsel has also pointed out that the defendant himself has alleged that the evidence of Mr.Sunil Bhalla be taken as affirmative as well as rebuttal. The affidavit of Mr.Sunil Bhalla was filed after completion of evidence of DW-1. Counsel submits that if the affidavit of Mr.Sunil Bhalla is only in respect of affirmative evidence, it could have been filed along with the earlier two affidavits of Mr.G.S. Madhusudan and Dr.V. Kamakoti. In fact, the defendant has already produced the rebuttal evidence, therefore, it is a deliberate attempt on the part of the defendant to produce the additional witnesses in order to delay the matter. Counsel further states that the defendant on one side was dragging the hearing of the injunction application by stating that the evidence be recorded by that time on urgent basis and simultaneously, the defendant is also delaying the said proceedings.

22. It is also submitted on behalf of plaintiff that even out of 4 witnesses, two are described as deposing on 54 agreements of the plaintiff which by itself is in violation of the order constituting the Confidentiality Club. These witnesses cannot be permitted to be shown the 54 agreements (except to the conditions imposed by the order passed by the Supreme Court). The said witnesses are different from two expert witnesses, namely, Hon'ble (Retd.) Mr. Justice Umeshwar Pandey, Former Judge of the High Court of Allahabad and Hon'ble (Retd.) Mr. Justice S.S. Kulshreshtha, Former Judge of the High Court of Allahabad who were nominated to be the part of the Confidentiality Club by the defendant. The order constituting the Confidentiality Club was challenged by the defendant and the said SLP was dismissed as withdrawn.

23. The entire concept of rebuttal evidence is that each party is given one chance to lead evidence on one issue. The plaintiff in the present case has led evidence on all issues qua which onus was on the plaintiff and it has the option of leading rebuttal evidence on issue No.4 which onus was on the plaintiff and it has the option of leading rebuttal evidence on issue No.4 upon conclusion of defendant's evidence on the said issue. The defendant has led evidence on all the issues No.1-8. Counsel for the plaintiff says that at the present stage of the case, the plaintiff is also not pressing for any opportunity to lead rebuttal evidence thus the matter be put up for final hearing by refusing the prayer of the application as the defendant despite of opportunities did not file affidavit of these witnesses.

24. No doubt, there is a force in the submissions of the learned counsel for the plaintiff, as it appears from the record that the defendant has produced the evidence in affirmative by way of DW-1 &

DW-3. The evidence of DW-2 Sunil Bhalla is produced by the defendant in affirmative as well as rebuttal evidence. However, it is also the admitted position that the said evidence of rebuttal was produced before concluding the evidence of Dr.V. Kamakoti (DW-3) who has been allowed to tender the evidence and for cross- examination on 1st June, 2016 onwards by the Division Bench. I have been informed that his evidence has also been concluded.

25. From the overall facts and circumstances of the case, it appears that the defendant wishes to produce more witnesses as additional evidence/ rebuttal evidence in relation to the subject matter of FRAND agreement. The plaintiff has not denied that the evidence sought to be produced is different that the evidence produced of DW-1 & DW-3, i.e. Mr.G.S.Madhusudan and Dr.V. Kamakoti. The statement was also made earlier by the learned counsel for the plaintiff that in case the evidence of these witnesses is not led, the plaintiff will also not produce the rebuttal evidence. It is not denied by the counsel for plaintiff that the right for rebuttal evidence was also reserved by the parties.

26. It is also pertinent to mention that as per the original schedule contemplated as agreed between the parties, in fact, both the parties were given time to file their respective evidence in affirmative simultaneously. Learned counsel for the defendant has also stated that in the affirmative evidence, the plaintiff has filed large number of documents including the test reports and logs. Therefore, in order to give a fair chance, the defendant is granted last one more opportunity to rebut the evidence on the issue of FRAND Agreement. Learned counsel for the defendant has also agreed that these witnesses may not be permitted to be shown all the 54 agreements in the original

position. The said agreements would be shown to the said witnesses directly after deletion of relevant portion in view of the order passed by the Supreme Court. Thus, the order in this regard be passed accordingly, however subject to the cost of Rs.50,000/- as the defendant has failed to file the evidence of these witnesses despite of time granted.

27. The opportunity is being given in the interest of justice, equity and fair play coupled with the fact of assurance given by the learned counsel for the defendant on behalf of his client that the defendant be granted final opportunity to file the affidavits on or before 29th June, 2016 and in case the said affidavits are not filed, the evidence of the defendant shall be treated as closed and even if the affidavit(s) of witness(s) are filed and the witness(s) would not present under any circumstances before Court when the matter is fixed for tendering the evidence and for cross-examination, the defendant agrees that the evidence of the said witness(s) be treated as closed. As the order is being passed after ten days when the statements were made therefore the time is extended upto 6th July, 2016.

28. As it is a technical matter coupled with the fact that the right to rebuttal was reserved by the parties when the schedule was arranged as well as affirmative and rebuttal evidence of DW-2 was concluded before the evidence of affirmative of DW-3, one final opportunity is granted to the defendant to file affidavit(s) as additional evidence of the rebuttal evidence on or before 7th July, 2016. An advance copy of the said affidavit(s) shall be given to the learned counsel for the plaintiff by 4th July, 2016 who will file the affidavit as response/rebuttal evidence, if so required, by 25th July, 2016. The evidence of the witness(s), whom affidavits are filed, would be recorded by the same

Court Commissioner from 18th July, 2016 to 26th July, 2016 (12 hours per witness). It would be the responsibility of the defendant to produce them before the Court Commissioner who will produce all details to the plaintiff's counsel.

29. In case all the witnesses or any of the witnesses will not be present, the evidence of the said witness(s) shall be treated as closed, as agreed by the learned counsel for the defendant. As far as the date of appearance is concerned, the learned counsel for the defendant will inform the Court Commissioner as well as the learned counsel for the plaintiff for their respective presence for the purpose of recording the evidence.

30. As regards the rebuttal evidence of the plaintiff, the same would be recorded from 1st August, 2016 to 5th August, 2016 (12 hours per witness). It is clarified that in case the defendant fails to file the affidavit(s) or to produce the witness(s) or any of the witnesses, the plaintiff under those circumstances, as agreed, would not be entitled to produce the rebuttal evidence and the evidence of both the parties shall be treated as closed.

31. The application is accordingly disposed of.

CS(OS) No.764/2015

32. List the suit before Court on 22nd August, 2016 for final hearing, in the category of "Short Cause". Both the parties are allowed to file written synopsis on or before 20th August, 2016.

(MANMOHAN SINGH) JUDGE JUNE 10, 2016