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Shantilal Paramshankar Joshi, Sole Prop., Espee and Co. Vs. themis Distributors (P.) Limited and anr. and - Court Judgment

LegalCrystal Citation
SubjectIntellectual Property Right
CourtChennai High Court
Decided On
Reported in(1979)1MLJ213
AppellantShantilal Paramshankar Joshi, Sole Prop., Espee and Co.;The Fairdeal Corporation (P.) Limited
Respondentthemis Distributors (P.) Limited and anr. and ;fairdeal Corporation (P.) Limited and ors.; Shantila
Cases ReferredSakkubai Ammal v. Babu Reddiar
Excerpt:
- .....and decrees that the present appeals have been filed.7. the main contention of miss. bakula, learned counsel for the appellant, is that the learned judge ought not to have accepted only the alternative relief for damages based on the profits made by the defendants, but ought to have granted compensation to the appellant on the basis of the loss suffered by him due to the admitted infringement of the patent. this is the main contention of the learned counsel for the appellant in both the appeals. we shall expatiate it later.in o.s.a. no. 53 of 1975, filed against the judgment in c.s. no. 67 of 1969 the respondents have taken out three applications. c.m.p. no. 7663 of 1977 is for excusing the delay in the presentation of the cross objections filed in o.s.a. no. 53 of 1975. c.m.p. no......
Judgment:

T. Ramaprasada Rao, J.

1. Four suits were tried together by Paul, J., and a common judgment was rendered. The plaintiff is the sole proprietor of Messrs. Espee and Company and he is the common plaintiff in all the suits. The defendants, however, are different. In this Judgment, we are concerned with CS. Nos. 67 of 1969 and 167 of 1971 against which the plaintiff has preferred O.S.A. Nos. 53 of 1975 and 51 of 1975 respectively. In O.S.A. No. 82 of 1976 the aggrieved defendants have filed a separate appeal against the grant of special costs by the trial Judge in C.S. No. 67 of 1969.

2. The relevant facts to appreciate the scope of these three appeals, can be summarised thus : The plaintiff claims to be an inventor of a patent and a device as the sole proprietor of Messrs. Espee and Company and one such patent discovered by him relates to combined closure and dropper for bottles and like containers of liquid. He secured the necessary statutory sanction to claim rights as patents having obtained the same from the Controller of Patents and Designs, under the Indian Patents and Designs Act of 1971 which was then in force and it is common ground that he has obtained a certificate evidencing such entitlement in him. The invention claimed by the plaintiff, as set out by the learned Judge in his judgment relating to this specification, is as follows:

1. A combined closure and dropper for a bottle or like container for liquids which consists of flexible cap or the like with a hollow chamber and provided with a spout projecting laterally from the body part of the said cap, the said spout having a capillary hole leading from the hollow chamber to the outside the arrangement being such that when the cap is fitted to the neck of the bottle containing a liquid, the liquid is dispensed through the spout in desired quantities by pressing the cap.

2. A combined closure and dropper according to claim-1 in which the said spout is integral with the body part of the flexible cap or the like.

3. A combined closure and dropper according to claim-1 in which the said spout is formed integrally with a ring of elastic material which is fitted in a groove formed around the body part of the cap or the like, the arrangement being such that when the cap is fitted to the bottle with the hole in the spout aligned with a hole provided in the said groove and leading to the said hollow chamber, the liquid is discharged by pressing the cap.

4. A combined closure and dropper for liquid-containing bottles according to claim-1 characteristic in that the said spout is constituted by one arm or a bent tube projecting outwardly through the cap, the other arm of the said tube being arranged to extend downwardly into the bottle below the level of the said liquid and very near the bottom of the bottle when the cap is fitted to the neck of the bottle or the like, so that the liquid is discharged by pressing the cap without tilting the bottle or the like.

5. A combined closure and dropper according to any of the preceding claims substantially as described and illustrated with reference to Figures 1 to 15 of the accompanying drawings.

3. While thus being vested with a right to have a monopoly in the matter of the patent rid the articles manufactured under it, the plaintiff's case is that the first defendant in C.S. No. 67 of 1969 began using the said device viz., the combined closure and dropper device and the second and third defendants aided him in manufacturing the same. In C.S. No. 167 of 1971 the case of the plaintiff is hat during one of his visits to his native place at Rajkot he was informed of the availiability of such closures and droppers in the fee market and on enquiry he found that lie defendants were amongst the infringers f the patent, and therefore he came to Court for the reliefs asked for by him in the plaint instituted for the purpose both against the defendants in O.S. No. 67 of 1969 and C.S. No. 167 of 1971. In the plaint, the plaintiff claimed that the defendants were liable to pay damages for the infringement of the plaintiff's patent and that the measure of damages should ordinarily be the loss sustained by him due to the reduction of prices of plaintiff's goods necessitated by the competition of the defendants in the infringing droppers. He would also lay his claim on the fact that his true and first invention to which he is exclusively entitled has been adapted without a licence from him by the defendants. In the alternative the plaintiff also sought for the following relief; in that he submits that the defendants are in the alternative liable to render an account of the manufacture and/or sale and/or use by them and the profits earned and realised therefrom during the time when the plaintiff had the right and monopoly to exploit the patent, and has sought for such damages in the alternative from 26th September, 1955. The prayers sought for by the plaintiff may also be set out to fully understand the scope of the case.

4. In paragraph 15 of the plaint, the plaintiff prayed for judgment and decree as follows:

(a) for an account of profits earned by the defendants or loss suffered by the plaintiff by manufacturing and/or selling and/or using since the defendants commenced infringement thereof; during the patent period of such profits by the defendants or loss suffered by the plaintiff by ordering payment of such sums as the Hon'ble Court may deem just in the alternative;

(b) for directing the defendants to deliver to the plaintiff or surrender to an officer of this Hon'ble Court the entire stock of the infringing goods, together with the dyes, and other implements used for manufacture of the same and also publicity materials, such as cartoons, blocks, stencils, price-lists, show cards etc., relating to infringing goods for the purpose of destruction of the same;

(c) for the appointment of a Commissioner for the purpose of taking inventory of all the stocks of the infringing goods, of the dyes and other implements used in the manufacture of the same, and of publicity materials, such as blocks, stencils, cartoons, price-lists, ledgers and journals, cash books and such other books and bill books and invoice books;

(d) for costs of this suit; and

(e) for such further or other reliefs as, the Hon'ble Court may deem fit and the nature of the case may require.

The partics went to trial after the defendants filed a written statement denying their liability to account to the plaintiff and inter alia claimed that the plaintiff did not secure any patent right over the alleged article in question.

5. The learned Judge framed the following issues in C.S. No. 67 of 1969.

1. Whether the plaintiff is the true and first inventor of 'combined closure and dropper' as set out in the claims annexed lo the Patent Grant No. 55471?

2. Whether the plaintiff's patent is not valid for all or any of the reasons alleged by the defendants?

3. Whether the plaintiff's patent was commonly known and publicly used as alleged by the defendants?

4. Whether the defendants have infringed the plaintiff's patent is any manner?

5. Whether the alleged infringement, even if true was innocent without any intention to make wrongful gain, as alleged by the first defendant?

6. To what relief is the plaintiff entitled? In O. S. No. 167 of 1971, the following issues were framed:

1. Whether the plaintiff's patent is valid?

2. Whether the defendants have infringed the plaintiff's patent?

3. To what relief the parties are entitled?

6. The learned Judge found after an elaborate trial and after looking into the oral and documentary evidence, that the plaintiff was the true and first inventor of the product and that the patent claimed by the plaintiff was already known in India. On a comparison of the material objects placed before him viz., the one invented by the plaintiff and the other marketed by he defendants, the learned Judge was of the view that they arc exactly similar and that the defendant's product did infringe the plaintiff's invention. He also found that those other than the manufacturers of the device having distributed the device or marketed the same along with their medicinal preparations should also be deemed to have infringed the plaintiff's patent. In the net analysis he gave a decree in C.S. No. 67 of 1969 and C.S. No. 167 of 1971 in favour of the plaintiff, entitling the plaintiff to the profits made by the defendants in regard to the infringing articles which would be ascertained by a Commissioner to be appointed for that purpose on the basis already indicated and directing that on the plaintiff paying the court-fee due on that ascertained amount there would be a decree declaring the validity of the plaintiff's patent. The matter was again posted, after delivery of the judgment, for certain clarifications. Once again the learned Judge on 8th April, 1974, after having pronounced the main judgment on 25th March, 1974 came to the conclusion that he did exercise his discretion in having accepted the alternative claim for damages claimed by the plaintiff and that no more argument was still open to the plaintiff in that behalf. The decree passed in C.S. No. 167 of 1971 is similar to the one passed in C.S. No. 67 of 1969 except for the differences with regard to the details relating to the claims in the said suits. Therefore the decree in C.S. No. 67 of lg69 that was drafted in this case may be extracted for ready reference:

It is declared, ordered and decreed as follows:

1. That the plaintiff's patent No. 55471 of 26th September, 1955 is valid and that the aforesaid patent is not liable to be revoked

2. That the defendants herein do render an account of their profits earned by them by manufacture and or sale and or use since they commenced infringement to the plaintiff's patent as aforesaid and those profits shall be awarded to the plaintiff herein.

3. That for the aforesaid purpose a Commissioner shall be appointed for taking accounts as to how many stoppers were distributed by the first defendant after purchasing the said stoppers from defendants 2 and 3 herein along with his medicine and what was the profit made by the defendants 2 and 3 herein in respect of them when they were sold to the first defendant and what was the profit made by the first defendant as ascertained from the price of those stoppers, which was included in the price of the medicine sold by the first defendant, so that the difference between the price at which the first defendant purchased those stoppers from defendants 2 and 3 and the price which the first defendant charged for the stopper when he included that price along with the price of the medicine, shall represent the profit which the first defendant has obtained and that profit shall also be awarded to the plaintiff herein.

4. That if it is found by the Commissioner that the first defendant herein had merely included in the price of the medicine the price for which the first defendant purchased the stoppers from defendants 2 and 3 herein, then the said first defendant shall not have obtained any profits and that in such a case, the profit obtained by defendants 2 and 3 in selling these stoppers to the first defendant shall be ascertained by the said Commissioner from their accounts in respect of the actual number of stoppers that have been distributed by the first defendant from the year 1968 and that that profit shall be awarded to the said plaintiff to be paid by the defendants jointly or severally subject to the plaintiff herein paying the court fee due on the amount so ascertained by the aforesaid Commissioner.

5. That the defendants herein do pay to the plaintiff herein the costs of this suit when taxed and noted in the margin hereof.

It is as against the above judgment and decrees that the present appeals have been filed.

7. The main contention of Miss. Bakula, learned Counsel for the appellant, is that the learned Judge ought not to have accepted only the alternative relief for damages based on the profits made by the defendants, but ought to have granted compensation to the appellant on the basis of the loss suffered by him due to the admitted infringement of the patent. This is the main contention of the learned Counsel for the appellant in both the appeals. We shall expatiate it later.

In O.S.A. No. 53 of 1975, filed against the judgment in C.S. No. 67 of 1969 the respondents have taken out three applications. C.M.P. No. 7663 of 1977 is for excusing the delay in the presentation of the cross objections filed in O.S.A. No. 53 of 1975. C.M.P. No. 7662 of 1977 is a similar application for excusing the delay in re-presentation. C.M.P. No. 7664 of 1977 is to condone the delay in paying the deficit court-fee in the matter of the presentation of the objections. The delay in this case is about 1 year 10 months. Similarly, in O.S.A. No.51 of 1975, two applications have been filed. C.M.P. No. 7131 of 1977 is for excusing the delay in re-presenting the cross-objections sought to be filed in this appeal and C.M.P. No. 7130 of 1977 is for excusing the delay in paying the deficit court fee on the cross objections, the delay being) 1 year and 9 months. We shall consider these applications at the end of our judgment.

8. The first point raised by the learned Counsel for the appellant in these appeals is that the learned Judge was not quite correct having regard to the peculiarity of patent law and the damages awardable in such actions, in having limited and circumscribed the right to secure damages on the basis of the alternative prayer sought for by the plaintiff in the suits. Miss Bakula's argument is that under the patent law two rights are available to the patent or who is aggrieved: He can ask for compensation for the loss on injury suffer-red by him for the illegal and wrongful acts of the infringer of the patent and that is the essential feature of the claim for damgages in a patent action. She would also to some extent concede that it is open to the aggrieved patentor to put the claim for damages in the alternative and seek for an account from the infringing patentee or marketer of such products arid on the basis of such an account, claim the profits secured by the group of infringers on such account-taking. But according to the appellant, the option rests with the plaintiff as the inventor of the patent and that such an option to elect one or the other of the methods of reckoning of damages could be exercised even after the pronouncement of the judgment. Reliance is placed upon an observation in Terrell and Shelley on Patents, Tenth Edition, at page 338, and the decision of the House of Lords in. The United Horse-Shoe and Nail Co. Limited v. John Stewart and Co. 13 A.C. H.L. 401. The respondent's case is that the pleadings give a clue to the claim of the plaintiff and the plaintiff having sought for such a claim as to damages in the alternative, and having so elected even at the threshold when the plaint was brought to the Court and the Court having accepted the plaintiff's case in so far as it related to the alternative claim, it is not open to the plaintiff once again to elect and go back on the well-known principle of the grant of damages in patent causes wherein the paten for has a right to ask for damages so as to restitute himself to the petition in which he originally was and be compensated with ali such losses suffered by him on account of the wrongful infringement of the patent by the infringer.

9. In so far as the claim for damages arising in consequence of an infringement of a patent is concerned, it appears that the plaintiff in such actions has a right to elect and even in such elections a peculiarity is demonstrable and is seen. The plaintiff in such cases can rest content himself by claiming damages for the alleged infringement. He or she need not make the election at that point of time when the lis is brought to Court. After being successful in establishing that there has been an infringement of the patent, he or she could either elect and seek the assistance of Court for the grant of damages on the ground that the plaintiff has suffered loss by reason of the wrongful infringement of the patent and therefore privileged to get all such reasonable compensation from the infringers, or in the alternative ask for an account of the profits gained by the wrongful user of such patent by the infringers. This position appears to be a very peculiar position available to the plaintiff seeking damages in a patent action. It is this which the learned authors of Terrell and Shelley on Patent have referred to in the Tenth Edition, at page 338 when they said|

A successful plaintiff is entitled to damages in respect of the actual infringement of his patent, or, at his option to an account of profits.

10. In a later paragraph, the authors would say that in such circumstances the plaintiff should be restored by monetary compensation to the position which he would have occupied but for the wrongful acts of the defendant, provided always that such loss as he proves is 'the natural and direct consequence of the defendant's acts.' The authors have also noticed that the alternative remedy which was available to such a plaintiff was abolished by the Act of 1919 in England, but it has been reintroduced by the Patents Act of 1949. Section 60 of the Patents Act, 1949, says that in an action for infringement of a patent the plaintiff shall be entitled, at his option, to an account of profits in lieu of damages. After having noticed this specific statutory provision, the learned Judge referred to a decision of the House of Lords in The United Horse Shoe and Mail Co. Limited v. John Stewart and Co. 13 A.C. (H.C.) 401 Strong reliance is placed upon this judgment by Miss Bakula. The learned Law Lords in this case were considering a case which arose in 1888. It is not suggested before us that there was a law relating to patents at or about the time when the House of Lords was considering the relative rights of the owners of patents as against the infringement of the patents and when they have made this observation. 'It is to be noted that the profits, or it may be, losses, made by the infringer is not of any relevance in computing the damage caused to the patentee by his infringement.' This general observation made at a time when there was no statutory provision is pressed into service by the learned Counsel for the appellant. But for Section 60 of the English Patents Act 1949, and even the general law as is applied and accepted in India, probably this argument is attractive. But, we cannot brush aside the statutory provision nor in England which provides for an alternative remedy to the owner of the patent who claims damages based on infringment of his patent. He can seek for a monetary compensation based on the actual loss suffered by him, or he can in the alternative ask, as provided in Section 60, for an account of the profits which the defendants have made in lieu of such loss or damages suffered by him. In this context, therefore, we are unable to accept the rule of the House of Lords referred to in United Horse Shoe and Mail Company s case1 as of universal application or in any event as a compulsive mandate in the light of the statutory provisions prevailing.

11. Even otherwise, there is another difficulty which the appellant has to surmount. While paraphrasing the plaint and the reliefs asked for, we have seen that the plaintiff did exercise his option and ask in the alternative for damages based on the profits which the infringers could have obtained by making a wrongfully use of the plaintiff's patent. The learned trial Judge exercised his discretion and granted' this alternative prayer. We have had occasion to consider the import of such a request by a litigant, under circumstances, though not similar but almost comparable with the case on hand. We observed in Sakku Bai Ammal v. Babu Reddiar alias R.S. Reddiar : AIR1977Mad223 as follows:

It is therefore, clear to us that as the choice of the reliefs is always with the plaintiff, who is the dominus litis in a litigation; he could seek for more than one independent relief or aslc for alternative reliefs. If he asks for the last of such reliefs, then he is placing the reliefs so sought for by him on a par with each other and if the Court trying the subject-matter, grants him one relief, then it follows that he has the benefit of the relief and he cannot throw overboard such a benefit with a design or motive or to further his own cause by seeking umbrage in an appellate Court, and ask for the relief not granted to him, which, as already stated, he only asked for in the alternative.

12. The appellant in this case as plaintiff sought for such relief in the alternative. He got one such relief asked for by him. That was a relief which was on a par with the other relief asked for by him. He cannot, therefore, be allowed at the appellate stage to reelect and seek for another relief distinct and different from the alternative relief asked for by him and granted by the trial Court.

13. One another argument addressed was that the election of such reliefs is always with the inventor of the patent who has suffered damages and therefore such an election could be made at any time. To accept this contention would mean that it would run counter to the ratio which we have dealt with in detail in Sakkubai Ammal v. Babu Reddiar : AIR1977Mad223 not only on the ground that the plaintiff was satisfied with the grant of the alternative relief but also on the ground that the Court having exercised its discretion and accepted the alternative relief, it is not open to the appellant now to go back and ask for another relief, i.e. alternative to the alternative relief, and press the appeal on that sole ground.

14. As regards the three petitions filed by the second defendant in O.S.A. No. 53 of 1975 Mr. Somayajulu, learned Counsel for the cross-objector has made it clear before us that the petitioner-cross-objector is rot canvassing the correctness of the findings of fact rendered by the Court below and that in the cross-objections he would circumscribe his objection only to the grant of the prayer for the appointment of a Commissioner to lock into his account as prayed for by the plaintiff for the determination of the quantum of damages suffered by the plaintiff in accordance with the judgment of the Court below. Haying made this position clear, we thought that to excuse the delay in the re-presentation of the cross-objections or to condone the delay in the payment of the deficit court-fee would not matter at all. He made such a submission with regard to the two petitions filed in O.S.A. No. 51 of 1975. We accordingly excuse the delay. Whilst, however, excusing the delay and ordering as proved for the petitions in C.M.P. Nos. 7662 and 7663 of 1977 in O.S.A. No. 53 of 1975 and C.M.P. No. 7131 of 1977 in O.S.A. No. 51 of 1975, we direct the respondent or respondents concerned to pay the deficit court-fee if not already paid within a week from this date, when the delay in payment of the deficit court-fee should be deemed to have been excused. If the deficit court-fee is not paid within a week from this date then the applications C.M.P. Nos. 7664 of 1977 and 7130 of 1977 shall stand automatically dismissed.

15. With the above preface we shall now consider the objections of the cross-objector or cross-objectors. According to them, the learned Judge was wrong in having directed the appointment of a Commissioner. We fail to see any substance in this contention for this reason. Once we come to the conclusion that the plaintiff is entitled to damages and that plaintiff has elected even at the threshold to base his quantum of damages on the profits earned by the defendants in the course of the infringement of the patent as manufacturer or distributor or seller, one fails to see how such damages could be reckoned without a scrutiny of the account books kept by the defendants during the period of infringement. We have already referred to the principle that the inventor of a patent is entitled to damages in case his patent is infringed and that the measure of damages is ordinarily the loss sustained by him by such wrongful user by others or has to be fixed with reference to the profits gained by the infringers by adoption of a patent invented by another and to which they had no semblance of a right. The only method by which the profits gained by the defendants could be ascertained is by inspection of the account books and for this purpose an officer of the Court has to go into the books of the infringing parties, take an inventory of all the stocks which were with them during the relevant period and thereafter with reasonable precision and on the available materials reckon and assess the profits which the infringers could have gained in their illegal activities. We are, therefore, unable to agree with the learned Counsel for the cross-objectors that the direction given by Paul, J., to appoint a Commissioner for the purposes as directed by him as in any way wrong or incompatible with the facts and circumstances of this case. The memoranda of cross-objections, shall stand dismissed.

16. Having regard to the conclusions above, O.S.A. Nos. 51 and 53 of 1975 shall stand dismissed and there will be no order as to costs.

17. As regards O.S.A. No. 82 of 1976, the only objection of the learned Counsel for the appellant is that the learned Judge was wrong in having granted special costs to the counsel who appeared before him in all the suits. The learned Judge fixed the counsel's fee at Rs. 2,500 and also expressed that Mr. Tarwady was of great assistance to the Court and that a higher scale of fee under Rule 16 of Order 5 of the High Court-fees Rules was called for. Learned Counsel for they appellant in this case says that under Rule 11 of Order 5 of the said Rules, the costs shall be taxed ordinarily in the manner prescribed in the rule preceding Rule 11. But, the counsel concedes that the Court always has the discretion to direct otherwise. In fact Rule 11 itself says : 'Unless the Court otherwise orders where the Court directs costs on the amount decreed, the costs shall be taxed in the manner prescribed in the last preceding rule,' Reliance is placed upon the fee certificate filed by the counsel in the first instance which was much lower than the sum granted as special fees to the counsel by the trial Judge. That only shows that when the counsel filed the fee certificate he honestly filed his certificate showing the exact fee received by him from his client. That does not mean that he is not entitled to a higher fee. When the matter came up before the learned Judge, he appreciated the quality and quantity of services rendered by the counsel and fixed a special fee of Rs. 2,500 which we are not inclined to disturb at this stage I he rule provides for it and the learned trial Judge exercised his discretion in favour of the counsel and taking into consideration there factors we see no reason to interfere with the order of the Court below. Accordingly, O.S.A. No. 82 of 1976 is dismissed. There will be no order as to costs. The plaintiff's counsel would be order in withdrawing the sum of Rs. 2,500 already in Court deposit


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