Samsung India Electronics Pvt. Ltd., the Indian arm of Samsung Electronics Co. Ltd., has challenged the constitutionality of India's customs regulations governing the import of goods suspected of infringing intellectual property rights, by filing a writ petition before the Delhi High Court.
Samsung India was aggrieved by the action of the Indian Customs Department in withholding clearance of its imported dual-SIM-card mobile phones, pursuant to an application filed by a patentee claiming rights over similar technology with the customs office. Specifically, Samsung India challenged Customs Notification No. 47/2007-Customs (N.T.), dated May 8, 2007—titled the Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007—read together with Customs Circular No. 41/2007, dated October 29, 2007, titled Instructions for Implementation of the Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007, issued by the Central Board of Excise and Customs.
Under these provisions, any right holder—whether patentee or licensee—may register their patent for a period of five years with the Intellectual Property Rights Cell of the Office of the Commissioner of Customs, by filing an application accompanied by grounds of suspicion, a brief disclosure of the technology involved, and an executed indemnity bond.
Background of the Underlying Patent
The dispute traces back to a patent application with the following prosecution history:
- March 4, 2002 – Patent application filed at the Chennai Patent Office with 4 claims and 12 drawings, Application No. 161/MAS/2002, titled "Mobile Phone with Multiple Number of SIM Cards to Receive and/or to Send Multiple Number of Signals at a Time."
- March 3, 2003 – Corresponding PCT application filed with WIPO (PCT/IN03/00044).
- September 12, 2003 – International publication (WO 03/75543 A2) issued, now with 11 claims and 11 drawings, titled "Mobile Phone with Multiple Number of SIM Cards to Transceive Multiple Number of Mobile Company Towers at a Time."
- January 4, 2004 – Amended claims filed with WIPO, increasing the claim count from 11 to 19; this amendment introduced, for the first time, a plurality of headphone/earphone jacks or plugs.
- January 8, 2004 – International Search Report (ISR) published.
- March 4, 2004 – Amended claims published.
- January 5, 2006 – Revised ISR published.
- January 23, 2006 – Further amended claims filed, increasing the count to 17.
- April 6, 2006 – Amended claims, along with a supporting statement, published.
- November 17, 2006 – Application further amended: claims increased to 20, drawings to 13, and the title changed to "Mobile Telephone Having a Plurality of SIM Cards Allocated to Different Communication Networks." This amendment, for the first time, disclosed and claimed a plurality of headphone/earphone jacks, a plurality of headphone/earphone plugs, and a plurality of Bluetooth devices.
- June 1, 2007 – Application published in the Indian Patent Journal with 20 claims, under the title "Mobile Telephone Having a Plurality of SIM Cards Allocated to Different Communication [Networks]."
- February 11, 2008 – Patent granted as Patent No. 214388.
Customs Registration by the Patentee
- December 8, 2008 – The patentee filed an e-application (No. UTRN0.TINMAA4PR0009) with the Office of the Commissioner of Customs, IPR Cell, Chennai, under the aforementioned customs notification and circular.
- January 27, 2009 – The Office of the Commissioner of Customs, IPR Cell, Chennai, communicated vide letter No. F.No. SIIB/IPR/1/08-ACC that the application had been registered and allotted UPRN No. A01671NMAA4PR.
Scope of the Patent Claims
The claims granted to the patentee relate to mobile handsets equipped with provisions for a plurality of SIM sockets (whether conventional or modified) to accommodate multiple SIM cards, together with a plurality of headphone/earphone jacks for accepting corresponding plugs, and/or a plurality of Bluetooth devices, enabling multiple incoming or outgoing calls to be handled simultaneously across the respective SIM cards.
This invention is materially distinct from conventional dual-SIM technology. While ordinary dual-SIM devices merely incorporate multiple SIM cards, the patented invention goes a step further by additionally requiring multiple headphone/earphone jacks and/or Bluetooth devices operating simultaneously, so as to enable multiple calls to be conducted concurrently across the respective SIM cards.
Analysis
This is not the first instance of an Indian regulatory framework being challenged by a multinational corporation before the courts; Novartis had previously pursued a similar course of action. In the present matter, however, there appears to be no infirmity in the customs regulations themselves. If any lapse is to be attributed, it may lie with the Chennai Patent Office, whose choice of an ambiguous patent title appears to have led the customs authorities—who lack the technical expertise to assess the underlying invention—to withhold clearance of shipments. This is despite the fact that the brief technical disclosure furnished by the patentee to the customs office made clear that the patented invention was distinct from conventional dual-SIM or multi-SIM technology.
Under Rule 7 of the Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007, where the Deputy Commissioner or Assistant Commissioner of Customs—whether acting suo motu or upon notice from the patentee—has reason to believe that imported goods infringe registered IP rights, clearance of such goods must be suspended. Where action is taken suo motu, the customs officer must have prima facie evidence or reasonable grounds for such belief. Reasons for the suspension must be communicated promptly to the importer, the right holder (or their authorized representative), by speed post, fax, or email. If the right holder or their representative fails to join the proceedings within 10 working days of the suspension (extendable by a further 10 days in appropriate cases), the matter may be decided ex parte on merits, and the goods released accordingly.
Further, in cases of suo motu action, the right holder must file the requisite application or notice and execute an indemnity bond within 5 working days of the suspension, failing which the customs authorities are required to release the goods, subject to compliance with other applicable requirements under the Customs Act.
Accordingly, the Indian customs regulations do appear to provide importers with a reasonable and time-bound opportunity to respond to any suspension of clearance. The prescribed timelines are equitable, and importers who suffer loss or damage due to any failure of action on the part of the right holder may seek damages, given that customs authorities are indemnified by the right holder in such matters. Moreover, once the question of infringement is judicially settled in respect of one importer's product, that determination may reasonably be relied upon by both other importers and the customs authorities in subsequent cases involving the same technology.
It is a well-settled principle of law that where an efficacious alternative remedy is available, resort to writ jurisdiction—being an extraordinary remedy—ought not ordinarily to be invoked. Apart from administrative recourse before the customs authorities, importers also had the option of seeking relief under Section 105 of the Patents Act, 1970, by instituting a suit for a declaration of non-infringement.
Furthermore, mobile handsets cannot, under any circumstances, be characterized as perishable goods liable to deteriorate if clearance is delayed—a factor that would ordinarily be necessary to justify invoking extraordinary jurisdiction.
Subsequent Developments
According to available information, Samsung subsequently withdrew its writ petition, and the patentee obtained a stay order against Samsung and several other dual-SIM importer mobile companies. Micromax, however, filed a declaratory suit under Section 105 of the Patents Act before the Gurgaon District Court, seeking a declaration that its handsets did not infringe the patentee's rights, and obtained a stay order in its favor. This order was subsequently challenged before the Punjab and Haryana High Court, which directed the trial court to decide the interim application within a stipulated timeframe. The trial court thereafter ruled in favor of Micromax, holding that its mobile handsets did not infringe the patent.
Separately, customs offices at Mumbai and various other locations found that the import of dual-SIM technology by other importers did not infringe the patentee's rights. Byond Tech, a leading mobile importer in India and part of the Canpex Group, also successfully obtained a stay order from a court in Pune, permitting it to continue importing dual-SIM mobile phones.
Comments
Post a Comment