India: Renewal & Restoration Of Lapsed Patents: Non-Compliance With Statutory Time Limits May Prove Fatal

Last Updated: 31 December 2014
Article by Priya Anuragini

Section 48 of the Patents Act, 1970('Act') confers broad exclusive rights on the patentee enabling her to exploit efficiently the incentives of her invention. The continued enjoyment of conferred rights, however, is subject to patentee being diligent and fulfilling certain statutory prerequisites or she may be compelled to license those rights or may even suffer abandonment or lapse of exclusive rights. For instance, all patentees are required to meet reasonable requirements of the public with respect to the patented invention, work the patented invention in India and make it available to the public at reasonably affordable price. While these requirements continue to garner a lot of media attention and evoke both positive and negative sentiments among stakeholders, one fundamental obligation that has largely gone unnoticed is the stipulation contained in Section 53 of the Act. In as much as the non-fulfilment of the prescribed condition may occasion altogether lapse of the patent, the provision merits a more serious analysis of its consequences and remedies available to the patentee in case the patent lapses.

Patent Renewal and Restoration: Mandate of the Statute

To keep the patent alive in India yearly payment of renewal fee to the Patent Office is mandatory. Section 53 of the Act in conjunction with Rule 80 of the Patent Rules, 2003('Rules') stipulates that the patentee may have to wash her hands off the patent if she fails to pay the requisite renewal fee, prescribed in the First Schedule of the Rules, to the Patent Office before the expiration of 2nd year from the date of filing of the patent application. From then on, yearly annuities to the Patent Office have to be paid till the 19th year within the period specified above. However patentee may seek an extension of six months for making the payment by filing Form 4. Further, if the patent has not been granted within two years from the date of filing of the patent application, the fees which have become due in the meantime may be paid within three months from the date of recording of the patent in the register or nine months in case extension is sought.

And then, if the patentee has still not paid the annuity, patent lapses albeit not completely for though the patent lapses right after the prescribed period is over, patentee has the option of getting it restored under section 60 of the Act by making an application to the Patent Controller within 18 months from the date on which the patent goes in coma (ceases to have effect). And if the controller is prima facie satisfied that patentee's failure was unintentional and the restoration application has been made without undue delay, the Controller publishes the application. And in case the application is able to sail through i.e. no interested person opposes the application or patentee is successful in thwarting off the opposition, then the patent is deemed to be alive from the date on which the application was published.

Don't let the Patent go: Pay in Time

Though it is possible for the patentee to restore the life of the patent, she may still suffer damage in view of section 62 of the Act. As per the section patentee will have no remedy against infringement of the patent that takes place between the date on which the patent lapsed and the date of publication of restoration application and patentee may even have to compensate persons who, while patent was in coma, had taken definite steps to avail themselves of the patented invention. It is quite obvious that sooner the restoration application is made, the better and safer it is for the patentee. Of course, the best is to not let the patent go in coma in the first place by adhering to statutory timeline. After all, it is not every patent restoration application that is successful. Perusal of the records of the Patent Office indicates that a significant no. of restoration applications filed with the patent Office is not successful. In the year 2011-12, 230 application for restoration were received by the Patent office while 132 applications were restored whereas in the year 2012-13, 342 applications were received but only 181 applications were restored (though it is not clear from the records that that no. of restorations mentioned for a particular year pertain to only the applications filed in that year or also include restoration applications filed in the previous on which decision was taken in the mentioned year) clearly indicating that Patent office is not very kind on patentees who miss payment deadlines. And it is all set to become stricter after the Delhi High Court order in Sanat Products v. Union of India1 wherein the Hon'ble Court has ordered that if the Patent Office decides to restore the patent, the impugned order should clearly indicate how the conditions specified in section 61 are met or the order would be unreasoned and application would have to be considered afresh. In the said case, patent was restored even though restoration application was filed after the lapse of prescribed period of eighteen months.

Considering that Patents Act unlike its counterpart Trademarks Act, 1999 does not obligate the Patent office to notify the patentee of the approaching date of expiry, many a times the deadlines are missed due to miscommunication between the patentee and his attorneys or the Patent Office.2 However it takes a lot of money and time (particularly in India's case,term of patent is already reduced due to late processing of patent application) to secure a successful patent, letting it go because of failure to abide by deadlines is simply not prudent.

1 Sanat Products v. Union of India , Delhi High Court, W.P.(C) 1843/2010

2 Teijin Limited v. Union of India, Bombay High Court, Writ Petition No. 1258 of 2011

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