d santhosh samuel

8/8/2019 D Santhosh Samuel

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Patent Controversy

Bajaj Auto TVS Motors


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Introduction

Chronology


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February 16, 2008

y Bajaj sought and was granted an interlocutory injunction by

the Madras High Court on restraining TVS Motor Co. Ltd.

(TVS) from launching their 125 cc motorcycle under the

trademark Flame


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May 18, 2009

y TVS lodged an appeal before the Division Bench and the

order of the Single Bench was overturned


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September 16, 2009

y Bajaj appealed before the Supreme Court, which directed

that TVS shall be entitled to sell its motorcycle Flame

y But TVS has to maintain an accurate record of all its domestic

and international salesy Directed the Madras High Court to appoint a receiver for

this purpose.


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Facts of the case


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DTS-i Technology

y On July 7, 2005, Bajaj was granted a patent with a priority

date of July 16, 2002

y The title of the patent application was An improved Internal

Combustion Engine working on four stroke principley Use of twin spark plugs located diametrically opposite to

each other in a small displacement engine with the cylinder

bore diameter ranging between 45 mm to 70 mm


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Pulsar

y In 2003, Bajaj launched Pulsar, a motorcycle which

employed the DTS-iTechnology in respect of which the

patent was then pending

y

In the first eight months of that financial year itself,B

ajajmanufactured and marketed 814,393 two-wheelers with the

DTS-iTechnology


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Flame

y In 2007, TVS announced the launch of a 125 cc motorcycle

under the trademark Flame

y Powered by lean burn internal combustion engine of bore

size 54.5 mm with a twin spark plug configuration just likeBajaj


10/18

TVS Suit

y TVS stated that on September 1 & 3, 2007, Bajaj had issued

certain groundless threats to dissuade TVS from launching

Flame

y

InO

ctober 2007, TVS filed a suit under section 105 & 106 ofthe Act in the Madras High Court, alleging constituted

groundless threats, and sought the intervention of the court

to restrain Bajaj from interfering with the launch of Flame

y

Further, TVS also filed an application for the revocation ofBajajs patent before the Indian Patents Appellate Board

under section 64 of the India Patents Act, 1970


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Bajaj Suit

y Bajaj filed a suit for permanent injunction under section 108

of the Act in the Madras High Court

y Restrain TVS from using the internal combustion technology

patented byB

ajaj and from employing the same in marketing2/3 wheelers, including TVSs proposed 125-cc Flame

motorcycle


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Analysis


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Principles for the grant of an

interlocutory injunction

y That the plaintiff must establish that it has a prima facie case,

that its patent is valid and that its rights have been infringed

y That the balance of convenience is in favor of the plaintiff

yThat the plaintiff would suffer irreparable loss and injury, ifthe interlocutory injunction, as sought, is not granted


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Single Bench of the Madras High Court

y Date: February 16, 2008

y Ruling: Restrained TVS from launching the proposed 125-cc

Flame motorcycle

yReason:y Bajaj prima facie enjoyed the right of exclusive usage of the

patent, granted to it by the PatentOffice.

y The Madras High Court held that Bajaj had succeeded in

establishing a prima facie case for the grant of an injunction


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Single Bench of the Madras High Court

y Pulsar had been introduced in the market in 2003, TVS had for thefirst time raised an objection only on August 24, 2007, by whichtime Bajajs DTS-i technology based product had been sold inlarge numbers across the country

y

Single Judge found that the petition for revocation of a patentgranted to Bajaj had been filed a mere six days prior to the launchof Flame, and as such the conduct of TVS was not entirely bonafide

y The patent granted to Bajaj could not be viewed with suspicion,

considering that it had been in existence for more than five yearsand as such the patentee Bajaj must be treated as an actual user andthe presumption of the validity of its patent was thus established


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Division Bench

y Nature of operation of the DTS-i engine by virtue of twin

spark plugs and that of TVS by virtue of receipt of air fuel

mixture through two different intake valves, their points of

emphasis differed considerably

y The operation of the invention as claimed by the Bajaj

appears to be plug centric and that of TVS was valve centric


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Supreme Court

y Reiterated that in matters relating to trademarks, copyright

and patents, the provisions of the Code of Civil Procedure

which mandate that civil disputes should be heard on a day to

day basis without any adjournments

y Final judgment should be given normally within four months

from the date of the filing of the suit


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Thank You!!!

the company lost about Rs 120 crore in sales because of the delay in

launching the Flame

MrVenu Srinivasan,

MD, TVS

d santhosh samuel

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