Brace Yourself, Long Post ahead!!
The Calcutta High Court (“CalHC”), in a set of two judgments, had the opportunity to discuss the scope of Section 3(b). I had previously discussed one of these judgments in detail. In ITC vs Controller (ITC-I), the CalHC had observed that whether an invention is hit by Section 3(b) is to be judged by the “intent” principle and not the harm principle [para 37]. In another subsequent judgement involving ITC again (ITC vs Controller or ITC-II), CalHC said something similar to what it had earlier said in ITC I. It stated the following:
“In passing the impugned order, there has also been a complete disregard to the intent principle i.e. intent behind the appellant’s invention and misplaced reliance on the affect or harm principle in arriving at such conclusion” … [para 8]
One has to admit that CalHC has been short on details regarding what it means by the intent principle. There have been some interesting discussions on the intent principle and Section 3(b). The intent principle, as I will show later down the post seeks to solve one of the legal puzzles that Section 3(b) provides us with. With the likelihood that more Courts adopting the intent principle and possibly further building upon what CalHC has said, it’s important to sit back and take stock of the intent principle.
Section 3(b) and its scope:
It’s useful to break down Section 3(b) into its constituent parts:
- Identify the “primary or intended use” of the invention or the manner in which the invention would be “commercially exploited”
- Determine whether the acts done above could be contrary to “public order” or “morality” or
- whether an invention causes “serious prejudice” to “human, animal, plant life or health or to the environment”.
Irrespective of how you are hit under Section 3(b), it is clear that two to three legal puzzles need to be solved. First, the Controller or the Court has to identify the primary or intended use of the invention or the manner in which it might be commercially exploited. Second, if needed, he has to figure out the definition of what constitutes public order or morality and whether the invention in question is contrary to the said public order or morality. Third, if needed, he has to define what constitutes serious prejudice to human, animal, plant life or health or to the environment and then decide whether the invention in question causes such serious prejudice.
Section 3(b) and its purpose:
To further understand the role of Section 3(b), it is useful to compare it with Section 66 of the Patents Act. Section 3(b) and its near cousin Section 66 seek to weed out patents broadly speaking, which when used or worked, can cause certain kinds of harm to society at large. Section 3(b) seeks to do this ex-ante (before the grant), while Section 66 seeks to do it ex-post (after the grant) on grounds broader than what is provided in Section 3(b).
Secondly, Section 3(b) must also be distinguished from other sections of the Patents Act, which seek to regulate the manner in which patent rights are exercised after grant and where the harm does not usually arise from the working of the invention or from possible uses it could be put to, but from the exclusionary effect the patent grant leads to. This exclusionary effect allows the patent holder to clear the market of competitors, which in turn can lead to higher prices and pricing out of consumers (Compulsory licensing, Govt use provisions etc).
Thus, one arrives at two conclusions. Section 3(b) seeks to weed out patents where an ex-ante determination of their possible uses is deemed to cause serious prejudice or could be against public order or morality. Second, the harm that is sought to be avoided arises from the fact that the invention disclosed in the patent application, if granted and subsequently worked in a certain manner, can be the source of such harm. Hence the state through a patent grant cannot legitimise inventions that produce such harm. With this grounding, one can move to the intent principle.
Tilting the Balance of Power:
The “intent” principle, as explained by CalHC in its two judgments, attempts to solve the first legal puzzle of identification of the primary or intended use or commercial exploitation. Here, as per the intent principle, the Controller is limited by the intention of the applicant as to how he/she plan to use them and for what purposes. Likewise, the Controller cannot rely on the “harm principle”. I am unsure as to what CalHC means by this, but I think CalHC is referring to some form of cost-benefit analysis of the possible benefits and harms the invention imposes on society as a whole when used. In both ITC-II and R.J. Reynolds Tobacco vs the Controller General of Patents, CalHC further made it clear that the Controllers cannot rely on pre-conceived biases or notions about a subject matter to declare that the patent application covering such falls under Section 3(b).
It is reasonable to argue that the “intent” principle, as it exists, is a judicial rule that seeks to counter the expansive powers of the Controllers under Section 3(b). The broad subjective sweep of Section 3(b), plus the lack of case laws clarifying its scope, allows for Section 3(b) to be used and abused. The intent principle gives more power to the applicant to exercise some form of control over how the Controller might arrive at the possible intended uses for the invention and then further determine whether the intended uses might fall under Section 3(b). It has to be noted that the Controller still has the freedom to interpret and understand the intended purpose(s) of the invention as stated by the applicant. Likewise, the ITC cases have not (to my understanding) clarified what constitutes “serious prejudice”. With ITC-II and R.J. Reynolds going only as far as saying that prior biases and pre-conceived notions cannot control the decision. Hence, a creative Controller might potentially still have a lot of leeway under Section 3(b).
Another question that follows is, how does one identify this intent? Should one rely on the claims or the specifications, or both? What happens when there are n number of possible uses and only one of those possible uses causes serious prejudice or is contrary to public order or morality?
One way to identify this intent is to read through the complete specifications and the written submissions made by the applicant while prosecuting the application. In some applications, like the Suit Patent application in ITC-II, the applicant might explain the objectives of the invention or the problem it seeks to solve. This makes the primary or intended uses of the invention clearer and gives more control to the applicant on how the invention is understood by the Controller for the purposes of Section 3(b). At least as to the final question, ITC-II seems to indicate that in such cases, the invention should not be hit by Section 3(b) in such instances [see para 8].
The “intent” principle a contrary interpretation:
The intent principle seems to be based on a selective reading of Section 3(b). The intent principle seems to have emerged from the phrase “primary or intended use”, which is used at the start of Section 3(b). This can be gathered from both the submissions of the Petitioner before CalHC in ITC – I (para 8) and their written submissions before the Controller in connection with the Suit Patent in ITC – II.
It is important to note that the words “primary” and “intended” are qualified by the word “use”, then it is followed by the words “commercial exploitation”, which is separated from “primary or intended use” by an “or”. The Parliament could have easily said “primary or intended or commercial use,” and then one could read this portion of the section together to come up with the intent principle, as the CalHC has done. But that is not the case; the word “commercial exploitation” stands independently separated by an “or” from the words “primary or intended use”. Hence, the intent principle, even if it applies, will apply only for the portion of the Section that talks about “primary or intended use”, while the word “commercial exploitation” should not be interpreted as being qualified by the words “primary” or “intended”. Thus, the intent principle, as it currently stands, has the effect of amending the statute through judicial interpretation.
Now the question follows: how should one understand the phrase “commercial exploitation”?
Since the phrase “commercial exploitation” is not controlled by the words “primary or intended use”, this could mean that the Controller still has the freedom to independently examine the possible uses of an invention, as it can reasonably be ascertained ex-ante (the Section uses the phrase “causes serious prejudice” not “would cause”), independent of the intended uses of the invention as disclosed by the applicant and whether those uses causes serious prejudice to human, animal, plant life or health or to the environment. Yet it is important to note that the Controller is limited by two additional factors. First, he is limited by the Section and the Act, wherein section 3(b) analysis is limited to identifying the possible uses that can arise when the patent application is examined ex-ante and he cannot try to forecast the possible impact of possible future uses. Second, the need to establish a causal connection between the possible uses determined ex-ante and the serious prejudice or public order or morality concerns they raise.
Questions to ponder:
On one hand, there have been allegations that a broadly worded Section 3(b) has the potential to be used arbitrarily in the sense that certain subject matter, for whatever reason, might come under the cross-hairs of Section 3(b) (For example, nicotine delivery products and sex toys) and Section 3(b) determinations are subject to the whims and fancies of the Patent Office. It has been argued further that this in turn, can have possible negative effects on the amount of research and investment that is being sunk into these areas, an argument based on the incentive theory of IP. Hence, subsequently a call is made for a narrow reading of Section 3(b) and a reduction in its scope. As I had argued above, the intent principle to an extent achieves this, but to what extent is an open question.
Yet on the other hand, Section 3(b) can be a tool to promote public health and keep inventions that are deemed harmful to society from being given a patent grant. Should one dilute Section 3(b) by adopting the intent principle, hence consequently reducing the ability of the sub-section to act as a tool to protect public health? Can threats or allegations or the possible potential abuse of a sub-section in itself sufficient reason to dilute its scope?
What to do now?
Section 3(b) in its current form asks the Patent Office to do something which is difficult. It requires the Patent Office to determine ex-ante whether an invention would be contrary to public order or morality, two words with contested meaning and there is no reason to think the Patent Office (or anyone for that matter !) is capable of applying this portion of the section, absent broad disagreements and disputes. Second, it also requires the Patent Office to determine ex-ante whether an invention can cause serious prejudice to human, animal, plant life or health or to the environment. In these difficult situations the intent principle provides a partial way out. It solves for one of the legal puzzles and control for the arbitrary power the Controller is likely to exercise by shifting the power balance in the favor of the appellant and putting the onus on him to draft the application in a manner so that intended use of the invention is clearly spelled out which in turn will exercise some restraint on how the Controller exercises his power under Section 3(b).
Yet this solution misses the problem. It ignores the fact that the problems that seem to plague Section 3(b) have a procedural solution without diluting public health safeguards. The procedural solution is two fold, first the requirement to issue a reasoned order which as a quasi-judicial authority the Patent Office is legally mandated to issue one. Secondly, as Sivaramjani Thambisetti had pointed out long back, the IPO can seek advice from other specialist bodies within the Government who are relatively better placed to determine the possible impact of an invention or the possible harm it might impose on society. This referral/advice process is not new and, in a different form, exists for defence-related inventions. This procedure, if adopted, most importantly provides the Patent Office a way to collect more information to decide the question of whether an invention falls under Section 3(b) and can further assist the Controllers to pass a reasoned order by establishing a more clear causal connection on how the invention falls foul of Section 3(b). These two procedural solutions preserve the broad scope of Section 3(b) while also bringing some accountability into the decision making thus reducing the scope for abuse.
The views and opinions expressed in this post are those of the author’s own personal opinions
I wish to thank Swaraj for his valuable input, without which this post would not have been possible!