Repeal Of EMR In The Patent Act: Glaxo´ Appeal Clarifies

The Patents Amendment Act, 2005 lead to the repeal of the provision enabling Exclusive Marketing Rights (EMRs). However, in cases where the EMR was applied for prior to the amendment coming to force, disputes may pose themselves forth various judicial forums. Questioning the correctness of an order passed in four appeals to a writ petition by a learned Single Judge at Calcutta High Court setting aside the order passed by the Controller of Patents and Designs, an appeal posed itself for hearing forth the Supreme Court of India, in Glaxo Smith Kline PLC and Ors. v. Controller of Patents & Designs and Ors (Civil Appeal No. 5588 of 2008).

The Writ Petitioners, Glaxo had filed an application for the grant of a Patent as under Section 5(2) of the Patents Act, 1970. An application to obtain an "Exclusive Marketing Right" (EMR) was also made. With respect to the EMR, a report was issued by the Examiner and the Controller consequently refused the prayer for the grant of EMR. Dissatisfied from the order of the Controller, two writs were filed, whereby the Controller was directed to reconsider and give an order afresh, "keeping all points open". The Controller yet again rejected the application. Pursuant to this order two appeals were filed challenging the order, while two more were filed by a third party to the proceedings who wanted to be added as party-respondent in the writ application.

In the course of the events, the Patent (Amendment) Act, 2005 came into force with effect from 1^st January 2005. The appellants in this appeal raised objections, questioning the maintainability of the writ vis-à-vis the amendment act taking force. They stated that there existed no scope to further consider the question of EMR as Chapter IVA of the Act has been deleted and in as much as Section 78 of the Amending Act had clarified that all pending applications for grant of EMR filed under Chapter IV-A of the Principal Act which were pending as on 1st January, 2005 should be treated to be a claim for patents covered under sub-section (2) of Section 5 of the Principal Act and that application be deemed as a request for examination of grant of patents under sub-section (3) of Section 11(B) of the Act. In other words, there existed no scope for considering any pending cases for grant of EMR after 1st January, 2005 and that the applications relating to grant of EMR disposed of earlier could not be revived for consideration. They also submitted that a crystallized right had accrued in the light of Sections 24A and 24B and that the original orders were under challenge. However, the respondents submitted that the intention of the statute appeared to be to the contrary and reflected in the transitional provision under Section 78 applies even if Section 11B (3) is found applicable.

Glaxo asserted that on the first day of January, 2005 no pending application filed by the writ petitioner for grant of EMR existed and the transitional provision in Section 78 of the Act therefore had no application to the case. They also averred that since the prayer for EMR was disposed off at a time when the amendment had not come into operation, therefore, there existed a right to challenge the order before an appropriate forum in accordance with law. The High Court was of the opinion that the preliminary objection regarding maintainability of the writ petition was to be accepted and therefore the appeals were allowed. The High Court however did not go into the merits of the participation of the third party.

The Supreme Court, giving due consideration to the provisions of the Patents Act, 1970 and Section 6 of the General Clauses Act, 1897,(dealing with the effect of repeal) and previously cited decisions, concluded that the Single Judge's view regarding the provisions of Section 78 of the Amendment Act have no application to the proceedings which were concluded before the appointed day appears to be the correct view governing the issue. The Court also opined that consequent to Chapter IV-A being repealed, the situation had to be dealt with in line with Section 6 of the General Clauses Act. The provisions of Section 78 being conditional in nature did not intend to cover cases where the application for EMR had been rejected with reference to Section 21 of the Amending enactment. The Court stated that the effect of the repeal had to be ascertained in view of Section 6 of the General Clauses Act. The appeal in this regard was allowed but in the circumstances without any order as to costs.

© Lex Orbis 2008

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