International Court of Arbitration at New Delhi, India THE CASE OF COMPULSORY LICENSE AND PATENT INFRINGEMENT UNDER TRIPS GOOD HEALTH COMPANY

Transcription

1 5 th LAWASIA INTERNATIONAL MOOT 2010 International Court of Arbitration at New Delhi, India THE CASE OF COMPULSORY LICENSE AND PATENT INFRINGEMENT UNDER TRIPS GOOD HEALTH COMPANY (CLAIMANT) VS. DIRECTOR OF INTELLECTUAL PROPERTY DEPARTMENT, STATE OF MARU (RESPONDENT) MEMORIAL OF DIRECTOR OF INTELLECTUAL PROPERTY DEPARTMENT, STATE OF MARU

2 TABLE OF CONTENTS TABLE OF CONTENTS... i INDEX OF AUTHORITIES... v STATEMENT OF JURISDICTION... vii QUESTION PRESENTED...viii STATEMENT OF FACTS... ix SUMMARY OF PLEADINGS...xiii PLEADINGS... 1 I. THE ACTION OF INTELLECTUAL PROPERTY DEPARTMENT OF MARU WAS VALID AND JUSTIFIABLE UNDER TRIPS IN GENERAL AND ARTICLE 31 OF TRIPS... 1 A. Doha Declaration is Binding on WTO Members... 1 (a) The Doha Declaration as a subsequent agreement for interpretative purposes... 1 B. Interpretation of the TRIPS Agreement... 2 (a) Vienna Convention (b) Objectives and principles of TRIPS... 2 (1) The TRIPS Article 7: Objectives... 2 (2) The TRIPS Article 8: Principles... 2 i

3 (c) The Doha Declaration... 3 (d) Access to medicine as a human right within WTO dispute settlement... 3 (e) In light of contemporary concerns... 4 (f) Application of the Doha Declaration... 4 (g) Conclusion... 5 (1) Non-violation of Article 31 (f)... 5 (2) Non-violation of Article 31 (b)... 5 (i) Member's freedom to determine what constitutes national emergency 5 (3) Non-violation of Article 31 (c)... 6 (4) Non-violation of Article 31 (h)... 7 (5) Non-violation of Article General Obligation... 8 (6) No further need to prove requirements to assert exceptions under the Doha Declaration because of the shift of burden of proof... 8 II. THE COURT OF MARU S FAILURE TO RECOGNIZE ANY INFRINGEMENT BEYOND THE LITERAL TERMS OF PATENT DID NOT VIOLATE ARTICLE 28 OF TRIPS... 8 A. The Doctrine of Equivalents Alone is not a Flawless Concept B. An Alternative Approach for Determining Patent Scope... 9 C. Giving Claims a Purposive Construction Eliminates Any Need for a Doctrine of Equivalents... 9 ii

4 (a) Purposive Construction (b) Article 69 of European Patent Convention (c) Kirin-Amgen v. Hoechst Marion Roussel Ltd D. It is Not a Mandatary for a Nation to Apply the Doctrine of Equivalents but Their Discretion (a) No artcile in TRIPS urges the application of the doctrine of equivalents (b) Republic of India Judiciary III. THE ACTION OF THE INTELLECTUAL PROPERTY DEPARTMENT WAS VALID AND JUSTIFIABLE AS PER "DECLARATION ON THE TRIPS AGREEMENT AND PUBLIC HEALTH (ADOPTED ON 14 NOVEMBER 2001) AND IMPLEMENTATION OF PARAGRAPH 6 OF DOHA DECLARATION ON THE TRIPS AND PUBLIC HEALTH (DECISION OF 30 AUGUST 2003) A. Neither Maru nor Porta violated The Chairman's statement...14 B. Valid establishment of insufficient capacity...15 (a) Insufficiency of manufacturing capacity is not challengeable (b) Even if challenge allowed, burden of proof is placed on the plaintiff IV. REMEDIES FOR THE GHC/GHC-MARU A. Remedies for the compulsory license issued by the IPD of Maru...16 (a) US$20 Per Unit is Enough to be Adequate Remuneration (b) Remedies in Case of Failure to Settle on Adequate Compensation (1) Provisional Measures Interim Injunction iii

5 (2) Remedies After an Infringement Established (i) An Injunction as a Possible Measure...17 (ii) Exemption from Liability for Unawareness and Good Faith...18 (iii) Damages and an account of profits...18 (iv) Compensations for costs of any subsequent suits for infringements...18 (v) Other remedies Forfeiture or destruction...19 (c) Procedural obligations under TRIPS (1) Misunderstandings about the principle of Fair and Equitable procedures (2) Obligation for judicial review B. Remedies for Failure to Recognize Any Infringement Beyond the Literal Terms 2 0 (a) Remedies for infringement of the GHC patent (b) Procedural Obligation - Transparent Procedures PRAYER OF RELIEF iv

6 INDEX OF AUTHORITIES INTERNATINONAL TREATIES AND CONVENTIONS Agreement on Trade-Related Aspects of Intellectual Property Rights 1994 (TRIPS)...12, 18 Convention on the Grand of European Patents (Oct. 5, 1973) European Patent Convention, Protocol on the Interpretation of Article 69 EPC (Nov. 9, 2000).10 Vienna Convention.2 WTO REPORTS AND DOCUMENTS WTO Appellate Body Report, United State-Import Prohibition of Certain Shrimp and Shrimp Products, WT/DS58/AB/R, (Oct. 12, 1998)..4 WTO document WT/MIN(01)/DEC/2, (Nov. 20, 2002) 6 JOURNALS AND ARTICLES Frederick M. Abbott, The Trips Agreement, Access to Medicines and the WTO Doha Ministerial Conference, Public Law and Legal Theory Working Paper No James Thuo Gathii, The Legal Status of the Doha Declaration on TRIPS and Public Heath Under the Vienna Convention on the Law of Treaties, 15 no. 2, HARV. J. L. & TECH. (2002) Joshua D. Sarnoff, Abolishing the Doctrine of Equivalents and Claiming the Future After Festo, 19 BERKELEY TECH. L.J. (2004) 9 v

7 Nicholas Pumfey ET AL, The Doctrine of Equivalents in Various Patent Regimes Does Anybody Have it Right?, 11 YALE J.L. & TECH. (2009)...9, 12 Tarun Mathur, Application of Doctrine of Equivalents in Patent Infringement Disputes, 13 J. INTELL. PROP. R., July BOOKS Holger Hestermeyer, Human Rights and the WTO : The Case of Patents and Access to Medicines (2007). 1, 2, 7 UNCTD-ICTSD, Resource Book On TRIPS and Development (2005).. 1, 17,19,20, 21 NATIONAL LEGISLATIONS (REPUBLIC OF INDIA) Customs Act 1962 (India) Patents Act 1970 (India).. 17, 18, 19 JUDICIAL DECISIONS (REPUBLIC OF INDIA) 2008(110) Bom.L.R AIR 1982 S.C (1844) 11 RPC 463 (CA)..13 FOREIGN JUDICAL DECISIONS Catnic Components Ltd. v. Hill & Smith Ltd., [1982] R.P.C. 183 (H.L) Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co. 535 U.S. 722 (200)...9 Graver Tank & Manufacturing Co. v. Linde Air Products Co. 339 U.S. 605 (1950).9 Improver Corp. v. Remington Consumer Products Ltd., [1990] Fleet Street Reports [F.S.R.] 191 (Pat. Ct.) vi

8 Kirin-Amgen v. Hoechst Marion Roussel Ltd., [2004] UKHL Warner-Jenkinson Co. v. Hilton Davis Chemical Co. 520 U.S. 17 (1997)....9 STATEMENT OF JURISDICTION GHC/GHC-Maru and Intellectual Property Department of Maru have submitted the present dispute before International Court of Arbitration, New Delhi. The arbitration is pursuant to Understanding on Rules and Procedures Governing the settlement of Disputes of WTO. The case concerns TRIPS in general and Article 28, 31, 41, 44, 45, 46, 48, 50 of TRIPS and Declaration on the TRIPS Agreement and Public Health and Implementation of Paragraph 6 of the Doha Declaration on the TRIPS and Public Health. vii

9 QUESTION PRESENTED 1. Whether the actions of Intellectual Property Department of Maru was valid and justifiable under TRIPS in general and Article 31 of TRIPS in particular. 2. Whether failure to recognize any infringement beyond the literal terms of patent violates Article 28 of TRIPS. 3. Whether the action Intellectual Property Department was valid and justifiable as per "Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of Doha Declaration on the TRIPS and Public Health (Decision of 30, August 2003). 4. If the actions of Intellectual Property Department of Maru are not justified under (a) and/or (b) and/or (c) then what remedies should be awarded to GHC/GHC-Maru. viii

10 STATEMENT OF FACTS BACKGROUND Maru is a small country whose economy depends mainly upon tourism and retail business. In 2009, a newly elected government decided to take an "open door policy toward foreign investment. As a result, one of the biggest pharmaceutical corporation, Good Health Company established a new company in Maru (GHC-Maru). INVENTION OF MIRACLE CURE Cure In 2006, GHC developed a drug to treat a wide range of flu viruses and called it Miracle SCOPE OF PROTECTION BY PATENTS Miracle Cure was protected by many patents which cover chemical composition of the drug, method of manufacture, and manner of use. After a successful clinical trial at Maru, GHC is the only company to manufacture and distribute Miracle Cure STRIKE OF AN UNKNOWN DISEASE At the end of 2009, an unknown disease struck one of the provinces of Maru. Patients of the unknown disease showed symptoms of flu. The disease was highly contagious and lethal. It was named "killer flu" WHO issued a travel advisory against travelling to Maru. EFFECTS OF MIRACLE CURE Miracle Cure was administered to the patients, and the patients showed recovery. ix

11 However it was not certain whether the recovery was permanent or temporary. The Health Minister of Maru instructed doctors to use Miracle Cure to stop the spread. The Health Minister ordered the director of the Hospital to use all the stock of Miracle Cure to stop the spread of the disease. Also in case of need for more supply, the minister ordered GHC-Maru to produce more. rised. With the spread of the disease, demands of Miracle Cure from all over the world has GRANTING COMPULSORY LICENSE Fearing insufficient supply of Miracle Cure due to its only production at GHC-Maru, the Minister of Health asked the Director of Intellectual Property Department of Maru to invite Fizer Pharma., the arch-rival of GHC, to manufacture Miracle Cure at Fizer's manufacturing facility in Porta, a neighboring country of Maru, for export to Maru. Under the direction of the Director of Intellectual Property Department of Maru, all the necessary information for the manufacture of Miracle Cure was provided to Fizer's facility in Porta. COMPENSATION As compensation the Intellectual Property Department of Maru agreed to pay GHC, US$20 per vaccine produced by Fizer in Porta and delivered to Maru. US$20 is the estimated production cost of Miracle cure. Fizer agreed to reimburse Maru for the payments to GHC. FORMAL PROTEST AND INFRINGEMENT ACTION GHC-Maru filed a formal protest with the Director of Intellectual Property Department against its decision to no avail. Then, GHC brought an infringement action against the Government of Maru for infringing its patent right. The court held that the compensation was x

12 "more than fair." Finding that the presiding judge was a classmate of the Chairman of Fizer at law school, GHC requested the presiding judge to disqualify himself, vacate the decision, and reset the matter for another hearing. The presiding judge denied the motion without convening the entire court. REQUEST FOR DISTRIBUTING SURE CURE Anticipating that GHC would take additional steps to attempt to prevent the people of Maru from having access to Miracle Cure, the Director of Intellectual Property Department contacted Better Life Pharmaceutical(BLP) at Ulka, requested to distribute "Sure Cure." Sure Cure is a very similar drug to Miracle Cure, however it is not identical. Sure Cure is composed of an extract of "Climbing Nightshade" with corn oil, whereas Miracle Cure is composed of an extract of "Climbing Nightshade" with palm oil. The Director of the Intellectual Property Department agreed to pay BLP, US$50 per unit delivered to Maru. DENIAL OF PRELIMININARY INJUCTION AND DISMISSAL OF WRIT OF APPEAL Sure Cure had been held to infringe the GHC patent in Hori pursuant to the "doctrine of equivalents". When BLP began exporting Sure Cure to Maru, GHC sought a preliminary injunction in the Intellectual Property Court and requested an immediate hearing. GHC urges patent infringement under the doctrine of equivalents. But, the IP court denied a preliminary injunction since they never recognized any form of non-literal infringement. DISPUTE xi

13 GHC requested the Commerce Minister of Hori to look into the matter. As GHC has suffered severe economic losses at a time when Hori is in the midst of a severe recession, and might be forced to cease all operations, the Commerce Minister of Hori called upon the Commerce Minister of Maru in an attempt to reach an amicable resolution of this dispute. It was agreed that the matter should be referred for arbitration. xii

14 SUMMARY OF PLEADINGS I. The actions of Maru is valid not in violation of the TRIPS Agreement read together with the objectives and principles set forth in Article 7 and 8 of TRIPS, the Doha Ministerial Declaration on the TRIPS Agreement and Public Health adopted on November 2001 and in the light of Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health because the Doha Declararion is legally binding and human rights law also can be considered for interpretation of the TRIPS Agreement. II. The doctrine of equivalents which is used for determining non-literal infringement of patents claims is not accepted as patent jurisprudence in all nations. In fact because of its side effect such as lacking theoretical justification, imposing high costs on society, and impeding innovation, the United Kingdom and other states are not applying the doctrine of equivalents on their patent infringement inquiries. Determining only literal infringement on scope of purposive construction is appropriate approach to patent infringement. In light of the fact that no article in TRIPS agreement urges the application of the doctrine and the judiciary of India, it is not a mandatory for a state to apply the doctrine of equivalents but is discretion. As a result, the court of Maru s failure to recognize any infringement beyond the literal terms of patent did not violate article 28 of TRIPS. III. The action of the Iintellectual Property Department of Maru is valid not in violation of the Doha Declaration read together with the objectives and principles set forth in Article 7 xiii

15 and 8 of the TRIPS, the Doha Ministerial Declaration on the TRIPS Agreement and Public Health adopted on November 2001 and in the light of Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health, because the Doha Declaration and Implementation of the paragraph 6 of the Doha Agreement leaves much flexibility and discretion for the decision on public health to the Member countries. Human Right law also strengthens the validity of the decision of the Members as an important instrument for interpretation of TRIPS. IV. Compensation paid to GHC by Maru for the compulsory licensing is enough to be adequate remuneration. Even if infringement were recognized, an interim injunction, damages or an account of profits could not be granted for lack of satisfying conditions. Instead, an injunction could be granted while forfeiture or destruction of goods is not appropriate. The principle of fair and equitable procedures could not be misunderstood. A judicial review should be provided pursuant to Article 41.4 of TRIPS. Injunction could be granted as a remedy for infringement by Sure Cure and the decision of Maru court. Other remedies such as damages or an account of profits shall not be granted if Maru successfully proves her unawareness or good faith. The principle of transparent procedures prescribed in Article 41.3 of TRIPS is not a legally bounding obligation. xiv

16 PLEADINGS I. THE ACTION OF INTELLECTUAL PROPERTY DEPARTMENT OF MARU WAS VALID AND JUSTIFIABLE UNDER TRIPS IN GENERAL AND ARTICLE 31 OF TRIPS A. Doha Declaration is Binding on WTO Members 1. The plain meaning of the text ("We agree") already supports its characterization as a binding agreement. Procedurally, the Declaration was passed by a consensus/confirming its importance and Member's commitment and making it unrealistic to not regard it as binding. The use of the term 'declaration' is irrelevant to the fact that the Doha Ministerial Declaration, too, is entitled 'declaration', even though it contains decisions. Furthermore, it is unconvincing to argue that Members consciously decided not to adopt a binding decision. Members reached the consent after much debate and it can be assumed that they wanted that consensus to be binding. 1 (a) The Doha Declaration as a subsequent agreement for interpretative purposes 2. Concerning the legal status of the Doha Declaration, some regard it as an authoritative interpretation according to Article IX: 2 of the WTO Agreement, whereas, others agree that the Doha Declaration is a decision within the WTO system, but regard Article IX: 1 as its legal basis and take the decision into account for interpretative purposes as 1 HOLGER HESTERMEYER, HUMAN RIGHTS AND THE WTO: THE CASE OF PATENTS AND ACCESS TO MEDICINES 280 (2007) 1

17 a subsequent agreement between the parties regarding the interpretation of the treaty. 2 B. Interpretation of the TRIPS Agreement (a) Vienna Convention Pursuant to Vienna Convention 31 1, a treaty should be interpreted in good faith using the ordinary meaning of its terms in context and in light of object and purpose. 3 (b) Objectives and principles of TRIPS (1) The TRIPS Article 7: Objectives 4. The TRIPS Agreement Article 7 states that "The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations. Article 7 makes clear that TRIPS negotiator did not mean to abandon a balanced perspective on the role of intellectual property rights in society. TRIPS is not intended only to protect the interest of the right holders, but it is intended to strike a balance that more widely promotes social and economic welfare. 4 (2) The TRIPS Article 8: Principles 2 Id. at Vienna Convention Article 31, 3(b) 4 UNCTAD-ICTSD, RESOURCE BOOK ON TRIPS AND DEVELOPMENT 126 (2005) 2

18 5. The TRIPS Article 8 states that "1. Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Agreement. 2. Appropriate measures, provided that they are consistent with the provisions of this agreement, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology. Article 8.1 establishes a basis for the adoption of internal measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development. However, the constraint is that the measures they adopt should not violate the terms of the Agreement. (c) The Doha Declaration 6. The Doha Declaration mandates reading the TRIPS Agreement in light of its objectives and principles, thereby giving countries a legal basis in the Agreement itself to argue in favor of public policies. The Doha Declaration supports reading all the provisions of the TRIPS Agreement in light of Article 7 and 8. The reading is further supported by the Appellate Body's reference to Article 7 and 8 in Canada - Term of Patent protection. 5 (d) Access to medicine as a human right within WTO dispute settlement 7. The right to access to medicine can be taken into account for the purpose of 5 James Thuo Gathii, The Legal Status of the Doha Declaration on TRIPS and Public Health Under the Vienna Convention on the Law of Treaties, 15 no. 2, HARV. J.L. & TECH. 291, 305 (2002) 3

19 interpretation of the TRIPS Agreement. Most scholars consider the role of non-wto law within the WTO settlement regime as rather limited. However, the Dispute Settlement Understanding (DSU) allows for the use of non-wto law to clarify the meaning of provisions of WTO law, or to be more precise of the "covered agreements". (e) In light of contemporary concerns 8. WTO Appellate Body Report supports reading the TRIPS Agreement in light of contemporary concerns of the community of nations when dealing with AIDS and similar health pandemics such as tuberculosis and malaria. 6 (f) Application of the Doha Declaration 9. Application of the Doha Declaration's waivers of Article 31 (f), (h) of the TRIPS Agreement, and pursuant to the Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of the Doha Declaration on the TRIPS and Public Health (Decision of ) read together with Article 7, Article 8 of the TRIPS Agreement and Human rights law concerning access to medicine such as Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health. none of the measures taken by the intellectual Property Department of Maru and Porta constitute a violation of the Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of Doha Declaration on the TRIPS and Public Health (Decision of 30 August 6 WTO Appellate Body Report, United State-Import Prohibition of Certain Shrimp and Shrimp Products, WT/DS58/AB/R at 50 (Oct. 12, 1998) 4

20 2003). (g) Conclusion 10. Non-violation of TRIPS in General and TRIPS Article 31 in light of Principles and Objectives of the TRIPS Agreement pursuant to Article 7 and Article 8 of TRIPS, Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of the Doha Declaration on the TRIPS and Public Health (Decision of 30 August 2003), Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health. (1) Non-violation of Article 31 (f) 11. Pursuant to the Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of the Doha Declaration, Article 31 (f) is waived. Thus, under the facts given, neither Maru nor Porta violated Article 31 (f) of TRIPS. (2) Non-violation of Article 31 (b) (i) Member's freedom to determine what constitutes national emergency 12. The Doha Declaration on the TRIPS Agreement and Access to Health says that "Each Member has the right to determine what constitutes a national emergency or other circumstances of extreme urgency, it being understood that public health crisis, including those relating to HIV/AIDS, tuberculosis, malaria and other epidemics, can represent a 5

21 national emergency or other circumstances of extreme urgency Pursuant to Principles and Objectives of the TRIPS Agreement pursuant to the TRIPS Agreement Article 7, Article 8, Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of Doha Declaration on the TRIPS and Public Health (Decision of 30 August 2003), Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health, developing Members and least developed Members have a wide range of discretion to determine national emergency that waives "prior negotiations" requirement provided under the TRIPS Article 31 (b). 14. Therefore, under the facts given, neither Maru nor Porta can freely determine the ongoing situation as "national emergency". The facts that the flu was lethal and highly contagious along with the issuance of advisory by WHO, evidence that Intellectual Property Department of Maru did not cross the boundary of the discretion set by the TRIPS Agreement. (3) Non-violation of Article 31 (c) 15. Intellectual Property Department of Maru's action is not in violation of the TRIPS Agreement Article 31 (c), because under the facts given, Maru's compulsory license was limited to the purpose for which it was granted in light of the Article 7, Article 8 of TRIPS, Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and 7 WTO document WT/MIN(01)/DEC/2, of November 20, 2002, paragraph 5 (c) 6

22 Implementation of Paragraph 6 of the Doha Declaration on the TRIPS and Public Health (Decision of ), Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health. Under the facts given, Maru could not expect how fast the disease would spread out, and Maru contracted to import Sure Cure from Ulka, and Miracle Cure from Porta because Maru was worrying about the prospective noncooperation of GHC/GHC-Maru. Thus, Intellectual Property Department of Maru s action was valid. (4) Non-violation of Article 31 (h) 16. Major considerations in awarding adequate compensation pursuant to the Article 31 in light of principles and objectives of the TRIPS Agreement pursuant to the TRIPS Agreement Article 7, Article 8, Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of Doha Declaration on the TRIPS and Public Health (Decision of 30 August 2003), Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health, are public health interests, private patent interests and economic circumstances of the Member that issued the compulsory license Under the facts given, public health takes precedence over the private patent rights of GHC, and economic circumstances of Maru has to be considered. Thus US$20 that amounts to 7 days salary of a worker in Maru as remuneration for the compulsory license is adequate 8 HOLGER HESTERMEYER, supra note 1, at 248 7

23 in light of balancing test on public interests and private interests along with economic circumstances that Maru is facing. (5) Non-violation of Article General Obligation 18. Under the facts given, mere the fact that the presiding judge and the CEO of GHC were classmates in their school days do not create any interest of conflict. (6) No further need to prove requirements to assert exceptions under the Doha Declaration because of the shift of burden of proof 19. It should be noted that under the Doha Declaration, once the importing Member and exporting Member fulfilled the requirements, the burden of proof that the requirements were not satisfied shifts to the challenging party. Thus, Maru and Porta do not have to prove that they met the requirements. II. THE COURT OF MARU S FAILURE TO RECOGNIZE ANY INFRINGEMENT BEYOND THE LITERAL TERMS OF PATENT DID NOT VIOLATE ARTICLE 28 OF TRIPS A. The Doctrine of Equivalents Alone is not a Flawless Concept. 20. The doctrine of equivalents which grants the patentee s exclusive rights beyond the literal terms of patent claims can hinder other competitors inventions. As a result, an extensive application of the doctrine without considering each patent infringement inquiry s 8

24 distinctiveness can lead to an impediment to technology progress. 21. The doctrine of equivalents articulated in Graver Tank & Manufacturing Co. v. Linde Air Products Co. 9, and its extended to later-arising technological equivalents in Warner- Jenkinson Co. v. Hilton Davis Chemical Co. 10 and Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co. 11 lacks theoretical justification, imposes high costs on society, and likely impedes innovation. It also needlessly conflicts with other patent law doctrines and complicates patent law procedures. These adverse effects are cumulatively imposed over time in regard to every issued and litigated patent for its entire term. 12 The doctrine of equivalents should be applied narrowly, limiting patent protection to the scope of application of the patent claims construed language. The doctrine of equivalents itself is not an omni-applicable doctrine which can settle every patent infringement inquiries. B. An Alternative Approach for Determining Patent Scope 22. Many jurisdictions have chosen to determine patent scope under a doctrine of equivalents, but because of its crucial drawbacks others have maintained the position that adequate scope can be found within the meaning of a patent s claim. 13 C. Giving Claims a Purposive Construction Eliminates Any Need for a Doctrine of Equivalents 9 Graver Tank & Manufacturing Co. v. Linde Air Products Co. 339 U.S. 605 (1950) 10 Warner-Jenkinson Co. v. Hilton Davis Chemical Co.520 U.S. 17 (1997) 11 Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co.535 U.S. 722 (2002) 12 Joshua D. Sarnoff, Abolishing the Doctrine of Equivalents and Claiming the Future After Festo, 19 BERKELEY TECH. L.J (2004) 13 See Nicholas Pumfrey ET AL, The Doctrine of Equivalents in Various Patent Regimes Does Anybody Have it Right?, 11 YALE J.L. & TECH. 261 (2009) 9

25 (a) Purposive Construction 23. Catnic Components Ltd. V. Hill & Smith Ltd. 14 a groundbreaking case which represents the current law of the English approach to equivalents, suggested a purposive construction. The court stated that a patent specification should be given a purposive construction rather than a purely literal one derived from applying to it the kind of meticulous verbal analysis in which lawyers are too often tempted by their raining to indulge In Improver Corp. v. Remington Consumer Products Ltd., 16 the English court restated the purposive construction approach as a sequence of three questions to be asked whenever the alleged infringement fell outside the primary, literal or a contextual meaning of the word or phrase. The last Improver question asks if the skilled person might, even if the variant works in obviously the same way as the patented invention, still construe the patent claim in a narrow manner such that the variant is excluded from its ambit. 17 (b) Article 69 of European Patent Convention 25. Article 69 EPC has two parts: a substantive part, and a Protocol on its interpretation. The substantive part states that the extent of the protection conferred by a European patent or a European patent application shall be determined by the terms of the claims. Nevertheless, the description and drawings shall be used to interpret the claims Catnic Components Ltd. v. Hill & Smith Ltd., [1982] R.P.C. 183 (H.L.). 15 Id. at Improver Corp. v. Remington Consumer Products Ltd., [1990] Fleet Street Reports [F.S.R.] 191 (Pat. Ct.). 17 Id. at Convention on the Grant of European Patents (European Patent Convention), art. 69, Oct. 5, 1973,

26 26. The Protocol on the interpretation of Article 69 EPC states that Article 69 should interpreted in the sense that the extent of the protection conferred by a European patent is to be understood as that defined by the strict, literal meaning of the wording used in the claims, the description and drawings being employed only for the purpose of resolving an ambiguity found in the claims. Neither should it be interpreted in the sense that the claims serve only as a guideline and that the actual protection conferred may extend to what, from a consideration of the description and drawings by a person skilled in the art, the patentee has contemplated. On the contrary, it is to be interpreted as defining a position between these extremes which combines a fair protection for the patentee with a reasonable degree of certainty for third parties. 19 (c) Kirin-Amgen v. Hoechst Marion Roussel Ltd In Kirin-Amgen v. Hoechst Marion Roussel Ltd., the ruling decision of the House of Lords, Lord Hoffmann was openly skeptical of the U.S. doctrine of equivalents remarking that American patent litigants pay dearly for results which are no more just or predictable than could be achieved by simply reading the claims. Lord Hoffmann argued that giving claims a purposive construction eliminates any need for a doctrine of equivalents. 28. Together with the purposive construction approach under English law and Article 69 of the European Patent Convention, the current approach where the need to provide adequate notice of patent breadth to the public is balanced against fair protection to the U.N.T.S. 255, European Patent Convention, Protocol on the Interpretation of Article 69 EPC, art. 1, Nov. 9, Kirin-Amgen v. Hoechst Marion Roussel Ltd., [2004] UKHL 46 11

27 patentee, a claim cannot be read literally, but is to be construed purposively in accordance with the specification and drawings. The Kirin-Amgen case clearly states that in order for a variant or an equivalent to infringe, such variant or equivalent must fall within the language of a claim. In other words, an equivalent that does not fall within the language of a claim, however interpreted, is not caught, despite the fact that such variant may amount to nothing more than an unfair copying of the very essence of the inventive concept. 21 D. It is Not a Mandatary for a Nation to Apply the Doctrine of Equivalents but Their Discretion. (a) No artcile in TRIPS urges the application of the doctrine of equivalents. 29. Article 28 of TRIPS sets the minimum standards to WTO member states, which states what types of acts will be regulated as infringement. These actions include unauthorized manufacturing, use, sale, offer for sale, and importation of the product, and, in the case of a process patent and the act of using the process of using, offering for sale, selling, or importing for these purposes the product obtained directly by that process It may seem that the text of Article 28 regulates indirect aspects of infringement. Although Article 28.2 regulates using products that are directly obtained by a process within the scope of prohibited activities, it leaves room to argue that TRIPs implies that a non-literal use of an invention is regulated as a directly infringing activity. 23 So, it is WTO members 21 Nicholas Pumfrey ET AL, supra note 13, at Agreement on Trade-Related Aspects of Intellectual Property Rights, art. 28, Apr. 15, 1994 [hereinafter TRIPS] 23 Nari Lee, Fragmented Infringement of Computer Program Patents in the Global Economy, 48 IDEA 345, 351 (2008) 12

28 own discretion whether to apply the doctrine of equivalents not a mandatary. (b) Republic of India Judiciary 31. Although recent Mumbai High Court discussed the doctrine of equivalents in the case of Ravi Kamal Bali v. Kala Tech and Ors 24, this case alone is not sufficient to claim that Republic of India fully adopted the doctrine of equivalents. Rather the Indian Court s decisions are highly influenced by the English Patent jurisprudence In the case of Bishwanath Prasad Radhey Shyam v. Hindustan Metal Industries, 26 the Supreme Court observed the proper way to construe a specification is not to read the claim first and then see what the full description of the invention is but first to read the description of the invention, in order that the mind may be prepared for what it is, what is to be claimed, as the patentee cannot claims more than he desires to patent. In Parkinson v. Simon, 27 Lord Esher M R enumerated that as far as possible that the claim must be so construed as to give an effective meaning of each of them, but the specification and the claim must be looked at and construed together. 33. It can be concluded that so far there have been very few cases dealing with patent claim infringement in India. Moreover, taking into account the Patent Act, 1970, it is evident that no specific provision exists regarding the patent infringement and interpretation of patent (110) Bom.L.R Tarun Mathur, Application of Doctrine of Equivalents in Patent Infringement Disputes, 12 J. INTELL. PROP. R., July 2007, at 418, AIR 1982 SC (1844) 11 RPC 463 (CA). 13

29 claims. 28 To fill this gap, the Indian Court look into the principles and tests laid down by the U.K and U.S. 34. Even if Maru admits the claim of GHC which asserts that India is now applying the doctrine of equivalents, this alone cannot be a ground for Maru to adopt the doctrine of equivalents. 35. So, GHC s claim to apply the doctrine of equivalents has no reason. III. THE ACTION OF THE INTELLECTUAL PROPERTY DEPARTMENT WAS VALID AND JUSTIFIABLE AS PER "DECLARATION ON THE TRIPS AGREEMENT AND PUBLIC HEALTH (ADOPTED ON 14 NOVEMBER 2001) AND IMPLEMENTATION OF PARAGRAPH 6 OF DOHA DECLARATION ON THE TRIPS AND PUBLIC HEALTH (DECISION OF 30 AUGUST 2003) A. Neither Maru nor Porta violated The Chairman's statement 36. The public health that is provided by the declaration of the Chairman is not limited to the domestic public health, rather is extended to any Member's public health. Maru is the center of the outbreak of the "killer flu", and the disease is highly contagious. Therefore the purpose of Maru's compulsory license on Miracle cure was to protect the public health of neighboring countries of course as well as Maru's public health. 37. In addition, Maru's decision should be deferred in light of principles and objectives 28 Tarun Mathur, supra note 25, at

30 of the TRIPS Agreement pursuant to TRIPS Article 7, Article 8, Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of Doha Declaration on the TRIPS and Public Health (Decision of 30 August 2003), Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health. 38. Porta's compulsory license was granted in good faith because the purpose of Porta's granting the compulsory license was demand-driven by Maru. B. Valid establishment of insufficient capacity (a) Insufficiency of manufacturing capacity is not challengeable 39. No provision under Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of Doha Declaration on the TRIPS and Public Health (Decision of 30 August 2003) states notification of insufficiency of manufacturing facilities can be challenged by other countries. According to the Implementation of Doha Declaration Paragraph 6, importing countries can have wide discretion to decide the insufficiency. The freedom to decide the insufficiency is further supported by the Doha Declaration along with the international Covenant on Economic, Social, and Cultural rights Article 12. (b) Even if challenge allowed, burden of proof is placed on the plaintiff 40. Even if the notification on insufficiency of the manufacturing capacity can be challenged by other Members, strong presumption on the validity of the decision by the 15

31 importing country should be made pursuant to Principles and Objectives of the TRIPS Agreement pursuant to the TRIPS Agreement Article 7, Article 8, Declaration on the TRIPS Agreement and Public Health (adopted on 14 November 2001) and Implementation of Paragraph 6 of Doha Declaration on the TRIPS and Public Health (Decision of 30 August 2003), Article 12 (1) of the International Covenant on Economics, Social and Cultural Right, which recognizes the right of all persons to the enjoyment of the highest attainable standard of physical and mental health. Thus the challenging Member would have to produce strong evidence to rebut the presumption of the validity of the decision the insufficiency on the part of the importing country. Any Member seeking to challenge the exercise of discretion should bear the burden of proving inconsistency. 29 IV. REMEDIES FOR THE GHC/GHC-MARU A. Remedies for the compulsory license issued by the IPD of Maru (a) US$20 Per Unit is Enough to be Adequate Remuneration 41. In considering what is adequate remuneration, the proportionality between the value of authorization and the interest of patent holder and the public as well as the economic circumstances of the country granting the license should be taken into account. Considering the economy of Maru significantly affected by attack of killer flu, the compensation cannot 29 Frederick M. Abbott, The TRIPS Agreement, Access to Medicines and the WTO Doha Ministerial Conference, Public Law and Legal Theory Working Paper No. 36, at 26 16

32 be more than the amount presently provided. 30 (b) Remedies in Case of Failure to Settle on Adequate Compensation 42. The domestic law of Maru has remedies based on TRIPS as minimum standards. (1) Provisional Measures Interim Injunction 43. Article 50 of TRIPS refers to its application in particular where any delay is likely to cause irreparable harm to the right holder. The mere possibility of producing harm to the right holder would not be sufficient to grant an interim injunction. 31 Besides, the economic loses GHC is suffering is not mainly caused by the action of Maru. (2) Remedies After an Infringement Established 44. The reliefs under Maru s Patents Act include an injunction and damages or an account of profits. The court may also order other remedies such as forfeiture or destruction. 32 (i) An Injunction as a Possible Measure 45. Article 44.1 of TRIPS states that the court have the authority to order a party to desist from infringement, inter alia to prevent the entry into the channels of commerce in their jurisdiction of imported goods that involve the infringement of an intellectual property right, 30 HOLGER HESTERMEYER, supra note 1, at UNCTAD-ICTSD, supra note 4, at Patents Act 1970, 108(1), (2). [India] 17

33 immediately after customs clearance of such goods. 33 The Customs Act of Maru has a provision in compliance with Article 44.1 of TRIPS. Section 11 of the Customs Act mentions the protection of patents as a purpose to enable the central government to prohibit importation or exportation of goods. 34 (ii) Exemption from Liability for Unawareness and Good Faith 46. Compliant to Article 48 of TRIPS, which exempts public authorities and officials in good faith from liability to remedial measures 35, section 111(1) of the Patent Act states that damages or an account of profits shall not be granted against the defendant who proves the infringement occurred unknowingly. 36 Maru is likely to afford the burden of proof that it was not aware and had no reasonable grounds for believing that the patent exists because Maru must have been completely confident of justification of her actions under Doha Declaration. Maru could be exempted from liability of damages of an account of profits. (iii) Damages and an account of profits 47. Despite Article 48 of TRIPS and section 111(1) of the Patent Act, failure to prove Maru s good faith could entitle her to the payment of the optional reliefs: damages or an account of profits. 37 (iv) Compensations for costs of any subsequent suits for infringements 33 TRIPS, art Customs Act 1962, 11. [India] 35 TRIPS, art Patents Act 1970, 111(1). [India] 37 Patent Act 1970, 108(1). [India] 18

34 48. If an order or judgment of suits for infringement is favorable to GHC, Maru shall be ordered to pay the full costs of subsequent suits for infringement to the patentee GHC. 38 (v) Other remedies Forfeiture or destruction 49. Other remedies are prescribed in the section 108(2) of the Patent Act in compliance with Article 46 of TRIPS. According to TRIPS Article 46, the need for proportionality between the seriousness of infringement and the remedies ordered as well as the interests of third parties shall be taken into account. One of the important factors of the consideration is the interests of the third parties like, in this case, distributors 39 who may have ordered and paid for Miracle Cure imported from Porta without knowing that it is an infringing goods. Other remedies are too much to meet the need of proportionality. (c) Procedural obligations under TRIPS (1) Misunderstandings about the principle of Fair and Equitable procedures 50. Article 41.2 of TRIPS indicates undesirable elements that could make a procedure unfair or inequitable, based on complexity, costs, time-limits and duration. 40 Thus, a violation of this principle shall be claimed in relation to those base factors, and not in relation to particular, isolated cases. 41 The relationship at the same law school 42 has almost nothing to do with the factors and does not establish violation of the principle. Additionally, if a 38 Patent Act 1970, 113(2). [India] 39 UNCTAD-ICTSD, supra note 4, at UNCTAD-ICTSD, supra note 4, at UNCTAD-ICTSD, supra note 4, at Moot Problem 2010 of 5 th Lawasia Moot, paragraph 16. [hereinafter Moot Problem] 19

35 dispute were to arise under the DSU, the complaining party, GHC would have the difficult burden of proving that a violation existed. 43 (2) Obligation for judicial review 51. Article 41.4 of TRIPS mandates the judicial review of initial judicial decisions. GHC has the right to appeal for a judicial review relating to the legal aspects of the decision of Maru court. B. Remedies for Failure to Recognize Any Infringement Beyond the Literal Terms (a) Remedies for infringement of the GHC patent 52. The decision of the IP court of Maru resulted in infringement of GHC patent as well as violation of Article 28 of TRIPS. The reliefs under Maru s Patent Act include an injunction, and if the actions are successfully proved to have been taken not aware of the patent s existence, Maru could be exempted from liability of damages or an account of profits. 44 Other remedies such as seizing, forfeiting and destroying 45 are too much to meet the need of proportionality test stated in Article 46. (b) Procedural Obligation - Transparent Procedures Article 41.3 of TRIPS requires that the decision on the merits of a case shall preferably be in writing and reasoned. Considering that the article chose to use the word 43 UNCTAD-ICTSD, supra note 4, at Patents Act 1970, 111(1). [India] 45 Patents Act 1970, 108. [India] 20

36 preferably, the obligation can be interpreted to be not mandatory and legally nonbinding UNCTAD-ICTSD, supra note 4, at

37 PRAYER OF RELIEF On the basis of the foregoing facts and points of law, Director of Intellectual Property Department, State of Maru respectfully requests this Arbitral Tribunal to declare that: I. Actions of Maru is NOT in violation of TRIPS in general and Article 31 of TRIPS; II. Not recognizing non-literal infringement on patent claims of Miracle Cure by the Intellectual Property Court of State of Maru is in NOT violation of Article 28 of TRIPS; and III. Actions taken by Maru are in NOT violation of the "Declaration of the TRIPS Agreement and Public Health (adapted on 14 November 2001) and Implementation of Paragraph 6 of the Doha Declaration on the TRIPS and Public Health (Decision of 30 August 2003). Respectfully submitted, Counsels for the Respondent. 22