TaxTMI 
TaxTMI 
2021 (5) TMI 1072
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....o the defendants to immediately withdraw Case No. (2020) E 01 Zhi Min Chu No. 169.1, filed by them before the Wuhan Court, (iii) a direction, to the defendants, to immediately withdraw the anti-suit injunction application, filed by them, before the Wuhan Court in the aforesaid complaint, and, (iv) imposition, on the defendants, of costs equivalent to the costs likely to be imposed on the plaintiffs by the Wuhan Court. 2. Mr. Gaurab Banerjee, learned Senior Counsel for the plaintiffs/applicants, submits that his clients were not pressing prayer (ii) in the application, and had no objection to the defendants' pursuing their suit/complaint before the Wuhan Court. He submits that his clients are, however, pressing prayers (i), (iii) and (iv). 3. By order dated 9th October, 2020, I had injuncted the defendants, ad interim, from enforcing against the plaintiffs, the directions contained in the order dated 23rd September, 2020, of the Wuhan Court. It was made clear, however, that the observations and findings contained in the said order were only ad interim in nature and were not binding when the application would be taken up for final hearing. The application has, thereafter, b....
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....sing their SEPs is, therefore, unquestionably an inalienable part of the present litigation. 8. Prior to the plaintiffs approaching this Court by way of the present suit on 29th July, 2020, the defendants had filed an SEP royalty rate-setting suit ("the Wuhan Suit" referred to, in the proceedings before the Wuhan Court, as "the complaint"), before the Wuhan Court on 9th June, 2020. The defendants sought, in the said complaint, fixing of a global FRAND royalty rate, on the basis of which they could obtain licence from the plaintiffs, to operate and use the technology covered by the entire patent portfolio of the plaintiffs, which would include the suit patents. 9. Summons, in the present suit, were issued by this Court on 4th August, 2020. On the very same day, the defendants filed an anti-suit injunction application before the Wuhan Court for a restraint, against the plaintiffs, from prosecuting the present suit before this Court. 10. By order dated 23rd September, 2020, the enforcement whereof the present application seeks to injunct, the Wuhan Court issued the following directions: "1. Upon service of this ruling, the Respondents InterDigital, Inc. and InterDigi....
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....Xiaomi Homecare commercial Co., Ltd., and Beijing Xiaomi Mobile Software Co., Ltd. as well as its affiliates; 6. Frozen the guarantee fund, RMB 10 million yuan, provided by the Applicants Xiaomi Communications Co., Ltd., Xiaomi Homecare commercial Co., Ltd., and Beijing Xiaomi Mobile Software Co., Ltd. for the behavior preservation application; 7. Other claims in the behavior preservation application of the Applicant's Xiaomi Communications Co., Ltd., Xiaomi Home Commercial Co., Ltd., and Beijing Xiaomi Mobile Software Co., Ltd. shall be rejected. In the event of the Respondents InterDigital, Inc. and InterDigital Holdings, Inc. violating this ruling a fine of RMB 1 million yuan per day shall be imposed, calculated cumulatively from the date of the violation." 11. By the present application, the plaintiffs seek an injunction, against the defendants, from enforcing, against them, the aforesaid directions issued by the Wuhan Court. C. Rival Contentions 12. Mr. Gaurab Banerji, learned Senior Counsel for the plaintiffs, advanced, essentially, the following contentions: (i) The impugned order completely divested the plaintiffs of their ri....
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.... therein, under Order XXXIX of the CPC. (iii) Mr. Banerji took exception to the defendants having sought to invoke the principle of comity of courts. He submitted that, where the order of the foreign court was in defiance of the public policy of the domestic court, no principle of comity of courts could inhibit the domestic court from protecting itself against the assault on its public policy. For this purpose, he relied on the judgment of the Supreme Court in Satya v. Teja Singh (1975) 1 SCC 120. He also submitted that comity was a two-way street. For this purpose, reliance was placed on IPCom GmbH & Co. KG v. Lenovo Technology (United Kingdom) Ltd. [2019] EWHC 3030 (Pat), Huawei v. Conversant [2019] EWCA Civ. 38 and, Owens-Illinois v. Webb 809 S.W. 2d. 899 (Tex. App 1991), decided by the Court of Appeals of Texas on 9th July, 1991. (iv) In this context, the aspects which are relevant for consideration, were (a) whether the defendants were required to be restrained, during the pendency of the present suit, from pursuing or enforcing the anti-suit injunction order dated 23rd September, 2020 of the Wuhan Court, (b) whether the defendants were requ....
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....made out in the plaintiffs' favour, for grant of injunction as sought in this application (barring prayer (ii) which the plaintiffs gave up). The consequence of the impugned order was that the plaintiffs would have to suffer continued infringement of the suit patent, without any licence being taken by the defendants and without the plaintiffs being allowed to oppose such infringement before this Court, being the only court competent to adjudicate the lis. The considerations of balance of convenience and irreparable loss, too, therefore, operated to justify grant of injunction, as sought in this application. (vii) On the aspect of "overlap" of the proceedings pending before this Court in the present suit and in IA 6440/2020 with the complaint filed by the defendants in the Wuhan Court, it was submitted that mere overlap, even if it existed, did not justify issuance of an anti-suit injunction as had been done by the Wuhan Court. Moreover, submits Mr. Banerjee, the overlap, if any, was only partial and incidental. It was pointed out that the scope of FRAND inquiry by this Court in IA 6440/2020, or even in the main suit, was fundamentally different from the scope of FRAND ....
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....nction preferred by the defendants therein. No notice, of the filing of the anti-suit injunction application, was ever served on the plaintiffs, before the order dated 23rd September, 2020, came to be passed by the Wuhan Court. The order was, therefore, effectively passed ex parte. (xi) Apart from the above submissions, which were intended to support prayers (i) and (iii) in this application, Mr. Banerjee also seriously pressed prayer (iv), which sought imposition of costs, on the defendants, equivalent to the costs/penalty payable by the plaintiffs in accordance with the order dated 23rd September, 2020, of the Wuhan Court. Emphasis was laid, for this purpose, on the defendants' own submission that they were powerless to restrain the Wuhan Court from enforcing the direction for payment of fine, as contained in the order dated 23rd September, 2020, as the anti-suit injunction application stood disposed of. Once the Wuhan Court had issued directions to the plaintiffs, and had made the directions liable to compliance on payment of fine, the defendants sought to submit that the decision on whether to secure enforcement of its order, or not, by recovery of the said costs f....
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....y itself that the asserted patents were valid, essential and infringed, and that, though the plaintiffs had complied with their FRAND obligations, the defendants were unwilling to take a license from the plaintiffs even at the FRAND rate determined by the Court. As such, he submits, determination of the FRAND rate at which the license, for exploitation of their SEPs, was to be granted by the plaintiffs, was a necessary precursor to any finding of infringement by the defendants, which would follow only if the defendants were unwilling to take a licence from the plaintiffs at the FRAND rate so determined by the Court. As such, he submits, the plaintiffs were misleading the court in contending that their claim before the Court was only for injuncting infringement of the suit patents. Mr. Kaul submits that FRAND rate determination was integral to the consideration of the prayer for interlocutory injunction made by the plaintiffs in IA 6440/2020. As such, the issue before this Court, and the Wuhan Court, he submits, were not only overlapping, but were substantially identical. (iii) If the two Courts were to be permitted to adjudicate their proceedings simultaneously, Mr. Kaul s....
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....been duly issued notice of the complaint, by the Wuhan Court, but has deliberately chosen to remain absent. He submits that, in fact, the plaintiffs were guilty of suppression, as they never informed this Court of the pendency of the said complaint despite being fully aware thereof. (vii) As such, submits Mr. Kaul, no case for grant of injunction, as sought in this application, exists. D. Judgments cited by learned Counsel 14. Admittedly, many of the issues which arise in the present case are res integra, at least insofar as the development of the law in this country is concerned. Extensive reliance has been placed, by learned Senior Counsel on both sides, on decisions rendered in foreign jurisdictions. These must, in the very nature of things, guide appreciation of the issues involved in the present case; accordingly, I am of the opinion that, at the outset, it would be appropriate to examine what has been held in these decisions. Before proceeding to foreign judgments, however, it would be appropriate, at the first instance, to study the decisions of the Supreme Court, this Court and the High Court of Calcutta, on which learned Counsel placed reliance. Admittedly, ....
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....ican Court may still proceed to confirm the award. And in doing so the American Court would take into account the American law and not the Indian law or the Indian Arbitration Act of 1940. And the American Court would be doing so at the behest and at the instance of Western Company which has in terms agreed that the arbitration proceedings will be governed by the Indian Arbitration Act of 1940. Not only the matter will be decided by a court other than the court agreed upon between the parties but it will be decided by a court under a law other than the law agreed upon. Should or should not such an unaesthetic (sic) situation be foreclosed? 14. The last submission is also quite impressive. If Western Company is right in the posture assumed by it in this Court at the time of the hearing that the American Court has no jurisdiction to confirm the award in view of the New York Convention is correct, the resultant position would be this: The award rendered by the Umpire, the validity of which is not tested either by an American Court or an Indian Court will have been enforced by an American Court. It will be an extremely uphill task to persuade the court to hold that a foreign a....
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....1940 Act, if Western were to be allowed to continue prosecuting the proceedings initiated by it in the US Court, ONGC would be driven to a "tight corner" once the award was enforced by the US Court, which would, consequently, be oppressive in nature. The two considerations which, to the mind of the Supreme Court, justified grant of anti-suit injunction, qua the proceedings in the US Court were, therefore, (i) the Indian Court being the proper court, for seeking enforcement of, or for challenging, the award and (ii) the difficulties which ONGC would face if the US Court were, without jurisdiction, to proceed to enforce the award. Modi Entertainment Network v. W.S.G. Cricket Pte. Ltd. (2003) 4 SCC 341 20. The dispute, in this case, emanated out of an announcement, by the International Cricket Council (ICC), for organising a cricket tournament in Kenya, for which W.S.G. Cricket Pte. Ltd. ("WSG", hereinafter) was granted exclusive license to grant commercial rights. Exclusive license was, thus, granted, by WSG, to the second appellant before the Supreme Court (whose identity is not forthcoming from the judgment) on 21st September, 2000. Said second appellant assigned its rights t....
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.... Patel (1998) 2 All ER 257 (HL) and Spiliada Maritime Corpn v. Cansulex Ltd. (1986) 3 All ER 843 (HL), the Privy Council in SNI Aerospatiale v. Lee Kui Jak (1987) 3 All ER 510 (PC) and its own earlier decision in O.N.G.C. (1987) 1 SCC 496, to lay down the following principles (in para 24 of the report): "(1) In exercising discretion to grant an anti-suit injunction the court must be satisfied of the following aspects: (a) the defendant, against whom injunction is sought, is amenable to the personal jurisdiction of the court; (b) if the injunction is declined, the ends of justice will be defeated and injustice will be perpetuated; and (c) the principle of comity-respect for the court in which the commencement or continuance of action/proceeding is sought to be restrained-must be borne in mind. (2) In a case where more forums than one are available, the court in exercise of its discretion to grant anti-suit injunction will examine as to which is the appropriate forum (forum conveniens) having regard to the convenience of the parties and may grant anti-suit injunction in regard to proceedings which are oppressive or vexatious or in a forum ....
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....s. (7) The burden of establishing that the forum of choice is a forum non-conveniens or the proceedings therein are oppressive or vexatious would be on the party so contending to aver and prove the same." 25. Ultimately, in the case before it, the Supreme Court dismissed the appeal of Modi, relying on the jurisdiction clause (albeit nonexclusive) contained in the agreement between Modi and WSG, conferring jurisdiction on English courts to adjudicate on disputes. That aspect is not of particular relevance to the present case, as there is no agreement between the plaintiffs and the defendants, on the basis of which the issue of jurisdiction can be determined. Dinesh Singh Thakur v. Sonal Thakur (2018) 17 SCC 12 26. This case involved a matrimonial dispute. The appellant before the Supreme Court was the husband, and the respondent, the wife. Consequent to marital relations souring, the husband filed a petition for divorce, against the wife, before the Family Court, Gurugram. Subsequently, the wife filed a petition for divorce, against the husband, before the Florida District Court. The husband, thereupon, filed a second suit before the Gurugram Court, seeking an anti....
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....the functioning of a sovereign or a private forum which may not be subject to the writ of that court. At the same time, despite placing such an onerous burden on a court assessing the propriety of such an injunction, the authority of such a court, unless it is of very limited jurisdiction, cannot be doubted, particularly if it is a High Court in this country exercising its original civil jurisdiction. That is not to suggest that a Civil Judge (Junior Division) may lack the authority, it is only that such an injunction may rarely be sought at that level. 56. The very purpose of law is to right a perceived wrong. In course of a court righting such wrong, at times, something more than adjudicating the immediate lis is also called for. It would be futile for a court to proceed steadfastly towards a decree in a civil suit if, in the mean time, the subject-matter of the decree is wasted or destroyed. In doing justice in accordance with law, the court will also try and preserve the subject-matter of the lis so that the beneficiary of the final verdict can enjoy the fruits thereof. It is the general authority of a sovereign forum as a court-as opposed to a private forum or a forum....
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.... was "a truism to say that whether it is a problem of municipal law or of conflict of laws, every case which comes before any "must be decided in accordance with law". Even if, in a given case containing a foreign element, the law of a foreign country was required to be applied in a given situation, for deciding the case, such recognition, to the law of the foreign country was accorded, not as an act of courtesy, but on considerations of justice. The Supreme Court held that "it (was) implicit in that process, that the foreign law must not offend against our public policy". On the aspect of comity, the Supreme Court entered (in para 17 of the report), the following critical observations: "The phrase "comity of nations" which owes its origin to the theory of a Dutch Jurist, John Voet, has, however, been widely criticised as "grating to the ear, when it proceeds from a court of justice" [De Nova, (1964) 8 American Journal of Legal History, pp. 136, 144 citing the early American author, Livermore]. Comity, as said by Livermore is a matter for Sovereigns, not for Judges required to decide a case according to the rights of parties." In para 18 of the report, the Supreme Court....
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....hnology (UK) (2019) EWHC 3030 (Pat) 33. IPCom sought, in this case moved before the UK High Court, injunction against continuance, by Lenovo, of anti-suit injunction proceedings initiated by Lenovo against IPCom in the California District Court. To that extent, the issue before the High Court in this case was similar to that before me, the only difference being that injunction in respect of the anti-suit injunction proceedings pending before the foreign court was in that case, sought while the anti-suit injunction application was pending, whereas, in the present case, the anti-suit injunction application has proceeded to judgment, and injunction, against enforcement thereof, is sought. 34. IPCom was the proprietor of EP 268, a European Patent, which was an SEP. IPCom alleged infringement, of said European Patent, by certain Lenovo companies based in the UK ("the UK Companies", in short). IPCom offered to license the use of its patent to Lenovo on terms which, according to it, were FRAND, but Lenovo was, according to IPCom, "holding out", meaning that it was merely protracting the exercise, without either accepting or rejecting the offer categorically. In March 2019, IPCom mad....
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.... be the case if I were to make the order sought. 46. The substantive action before the US Court has been brought by US Companies and it concerns only the settlement of a global FRAND license and 2 US patents. It does not directly concern the issues in the present action, namely the infringement and validity of the UK designation of EP '268." (Emphasis supplied) 36. Equally seminal is para 48 of the decision, which emphasises the position that the relief sought in the High Court-for injunction against infringement of EP '268-could not be sought before any other forum, and certainly not before the California District Court: "The application before me is directed at the substantive question of which Court should [determine] the issues of infringement and validity of EP 268. The first matter I must consider is whether England is clearly the more appropriate forum in which to decide those issues. Very clearly, it is. The grant of patent is an act which can be performed only by a state. Therefore the validity of a patent is an issue reserved for the course of the granting state, at least in Europe It would surprise me to learn that the rules of juris....
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....the infringement of its title", disregarding all statutory provisions, entitling the patent holder to so agitate. 5As cited by the Paris Court of Appeal, (i) Article L. 611-1 of the Intellectual Property Code according to which "any invention may be the subject of an industrial property title issued by the Director of the National Institute of industrial property which confers on its owner or his successors in title and exclusive right of exploitation", (ii) Article L. 615-1 of the Intellectual Property Code which provided that "any infringement of the rights of the owner of the patent, as defined in Articles L. 613-3 to L. 613-6 constitutes an infringement", (iii) Article 1 of Protocol 1 of the European Convention on Human Rights, according to which "every natural or legal person is entitled to the peaceful enjoyment of his possessions" and not to be deprived thereof "except in the public interest and subject to the conditions provided for by law and by the general principles of international law", (iv) Article 17 of the Charter of Fundamental Rights of the European Union which expressly included intellectual property in this protection and (v) Articles 6 §....
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....al right", to direct Lenovo "to withdraw under penalty" the anti-suit injunction application. SAS Institute Inc (2020) EWCA Civ 599 42. The facts, in this case, were somewhat involved, but it is necessary to refer to them. SAS, based in North Carolina, developed the software known as the SAS System. This software enabled users to write and run applications in a language known as the SAS Language. World Programming Ltd. (WPL) created a product known as the World Programming System (WPS). The WPS emulated the SAS System as closely as possible, so that programs, of the customers of WPS, could be executed, when run on WPS, as on the SAS System. For this purpose WPL took a license of the SAS Learning Edition from SAS. The terms of the license prohibited the use of the software to produce a competing product. Violating this, WPL sought to replicate the functionality of the SAS System in its own WPS Software. 43. SAS sued WPL in England, alleging copyright infringement and breach of contract. The claims were rejected by a single Judge, on the ground that the terms of the license granted by SAS to WPL, for the SAS Learning Edition were null and void. SAS's appeal, against this....
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....s filed by SAS before the California court on 18th June, 2018. The California court indicated its intention to pass an Assignment Order and a Turnover Order, as sought by SAS. The Assignment Order was to require WPL to assign, to SAS, all rights to payment due or to become due from companies identified on SAS's Customer List, the satisfaction of the judgment passed by the North Carolina Court for a total of US $ 79,129,905.00, and the Turnover Order was to require WPL to transfer, to the US Marshal, all receivables arising from business conducted between WPL and its customers. It was an admitted position that there was a substantial risk that the California Court would pass these orders. 47. WPL applied, in the English Court, for an interim anti-suit injunction. On 21st December, 2018, a learned Judge of the English Court (Knowles, J.) granted injunction as sought, prohibiting SAS from taking steps to seek either of the aforesaid proposed orders or any similar relief from any court in the US, and, additionally, prohibiting SAS from taking any step before any US court to restrain the anti-suit injunction application filed by WPL in the English Court. 48. In March 2019, the....
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....ns in the case before me. 51. While it was necessary to provide the aforesaid factual backdrop, in order to appreciate the ultimate decision of the Court of Appeal, what is of particular significance is the view of the Court on the aspect of anti-enforcement injunctions, as this Court is also, in the present case, seized with one such situation. Paras 92 and 93 of the judgment of the Court of Appeal observed thus: "92. Before I do so, I need to refer to the cases dealing with anti-enforcement injunctions. These are cases where the foreign proceedings have proceeded as far as judgment and the unsuccessful defendant seeks an injunction from the English court to restrain the successful claimant from enforcing the judgment. Ms. Carss-Frisk submitted that such injunctions may only be granted in exceptional cases, supporting the judges approach that, in general, it would be necessary for an applicant to show conduct akin to fraud or, at any rate, of similar gravity. Mr. Raphael acknowledged that such injunctions would be rare, but submitted that exceptionality was not a distinct jurisdictional requirement. 93. In my judgment there is no distinct jurisdictional requir....
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.... of the respondent and the other involved an attempt to execute the judgment when, after it had been obtained, the respondent had promised not to do so. Knowles J suggested another circumstance where an injunction might be granted, namely where the judgment was obtained too quickly or to secretly to enable an anti-suit injunction to be obtained, a circumstance far removed from this case. No example has been cited to us of a case where an anti-enforcement injunction has been granted simply on the basis that the proceedings sought to be restrained were commenced in breach of an exclusive jurisdiction or arbitration clause. 119. This dearth of examples is not surprising. If, as has been heretofore been thought to be the case, an applicant for anti-suit relief needs to have acted promptly, an applicant who does not apply for an injunction until after judgment is given in the foreign proceedings is not likely to succeed. But he may succeed if, for instance, the respondent has acted fraudulently, or if he could not have sought relief before the judgment was given either because the relevant agreement was reached post judgment or because he had no means of knowing that the judgme....
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....lish court is the natural forum for determination of the parties dispute. But as Lord Goff was careful to emphasise at 140 B-D, this is only a general rule, which must not be interpreted too rigidly. In a case where the injunction is sought in order to protect the jurisdiction of the process of the English courts, the existence of a sufficient interest will generally be self-evident. Indeed, the need to protect the jurisdiction of the court has been described as "the golden thread". In Masri (No. 3) Masri v. Consolidated Contractors International (UK) Ltd (No. 3) [2008] EWCA Civ 625, [2009] QB 503 at [86] Lawrence Collins LJ said this: "In Bank of Tokyo Ltd. v. Karoon (Note) (1987) TC 45, 58, Robert Goff LJ referred to Judge Wilkey's statement in Laker Airways Ltd. v. Sabena Belgian World Airlines (1984) 731 F 2d 909, 926-927 that anti-suit injunctions were most often necessary (a) to protect the jurisdiction of the adjoining court, or (b) to prevent the litigant's evasion of the important public policies of the forum, and concluded (1987) AC 45, 60: 'without attempting to cut down the breadth of the jurisdiction, the golden thread running through....
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....with the jurisdiction of the English court, in the light of the internationally recognised principles for the territorial allocation of enforcement jurisdiction which I have described. For that reason such an order could also be characterised as vexatious. If necessary, therefore, I would conclude that the criteria for an anti-suit injunction to restrain SAS from seeking such an order are satisfied. Such an injunction would be necessary to protect the territorial enforcement jurisdiction of the English court. 125. It would remain to consider whether such an injunction should be refused as a matter of discretion, having regard to issues of comity, delay and submission. Of these, comity would present the most serious obstacle but, for the reasons I have explained, would not in my judgment prevent the grant of injunction. It is notable that SAS has not so far sought, and the United States courts have not indicated that they would be prepared to grant, an Assignment Order extending to debts due from WPL customers in the United Kingdom. It may be that this forbearance involves some recognition of the exorbitant effect of such an order and the proper role of the English court in....
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....injunction, but this does not differentiate these proceedings from other cases before the English court; the reliefs sought is generally the object of the proceedings. ***** 68. I agree with Birss J that there is no such thing as a portfolio right. That mischaracterises the claim, as it is not the cause of action suit upon. These claims are concerned with infringement of UK patents, and the relief that should be granted if infringement is established. If one or more of the four patents in suit is held to be valid and infringed, then the Court will consider what relief should be granted. Conversant says that it is willing to grant a license on FRAND terms and (subject to some equivocation) the Defendants say that they are willing to take a license on FRAND terms. There is a dispute between the parties as to whether a global license would be FRAND. 69. Whether such relief should be granted in the present case will be a matter for the FRAND trial, if liability is established. If these claims were stayed on the basis of forum non conveniens, then the consequence would be that the English court could not decide upon infringement of UK patents, and could not de....
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....reement with the view of Carr J., the Court of Appeal went on to hold thus: "104. If one characterises the case in the way in which the judge characterised it, with which I agree, then it seems to me that the forum conveniens question answers itself. The fact that the dispute concerns UK patents is a matter of substance and not a form. Resolution of the dispute will involve determining infringement, essentiality and validity of UK patents. A UK forum is clearly the most appropriate forum, indeed the only possible forum, for this dispute to be tried. The further evidence of Chinese law, if admitted, could not influence this outcome. Even taken at its highest it does not suggest that the Chinese court could inquire into the validity of UK patents. ***** 110. The fallback positions advanced by the appellants are not, to my mind, properly applications of the forum non conveniens principal at all. As the analysis in Unwired CA Unwired Planet International Ltd v. Huawei Technologies Co Ltd, (2018) EWCA Civ 2344 shows, consideration of the offers made by the parties against the FRAND criterion is an embedded part of the determination of whether Conversant i....
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....d to serve out of the jurisdiction, so that the burden then shifts to the claimant to show that England is the more appropriate forum, that still requires there to be another candidate with the requisite jurisdiction. In the present case, China is the only candidate which the appellants have put forward." (Emphasis supplied) 62. Thus, in these paras, the UK Supreme Court emphasized two important principles, viz. that (i) the holder of the SEPs was entitled to sue for infringement of the SEPs in the country where the SEPs were granted, even if fixation of a global FRAND rate was one of the issues which would arise for consideration in that case, and that exercise could more conveniently be undertaken by the court in another country, as the dispute raised by the SEP holder was essentially of infringement of the patents, and not fixation of the terms of a global FRAND license, and (ii) a challenge to jurisdiction on the ground of forum conveniens could succeed only if the challenger were to cite another forum which would be more convenient for the lis to be adjudicated. Ecobank Transnational Inc (2016) 1 WLR 2231 63. Mr. Kaul referred me to various ....
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....junction application preferred by Hilton. Para 43 enumerates the reasons for the judgment of the High Court. Paras 58 to 63 set out the submissions of learned Counsel for the parties. Interestingly, para 58 reveals that Hilton had actually participated in the Maldivian proceedings, which proceeded to the judgment of which Hilton now sought injunction from the Singapore High Court. Paras 64 to 68 set out the grounds on which anti-suit injunction could be granted. Inasmuch as the Supreme Court of India, as well as various High Courts, have elucidated the law, as applicable in this country with respect to anti-suit injunctions, with sufficient clarity, it is hardly necessary to refer to the principles contained in these paras. Suffice it to state that a reading of paras 64 to 68 reveals that there is no real difference in the law relating to grant of anti-suit injunctions as it is applied in Singapore, vis-à-vis the law as it applies in India. Para 69 cautioned that, even though anti-suit injunctions are operate in personam, they nevertheless indirectly interfere with foreign proceedings, which was inconsistent with normal relations between friendly sovereign states. For this r....
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.... court would have expended vast amounts of judicial time and costs, and respect for the operations of foreign legal systems entails caution in exercising the jurisdiction to enjoin a party from relying on the foreign court's decision. (c) This consideration is amplified when an anti-enforcement injunction is sought after issuance of a court judgment and such injunctions should generally be refused; not least for want of sufficient promptitude. Further, two additional considerations come into the picture: first, such an injunction would preclude other foreign courts from considering whether the judgment in question should be recognised and enforced; and secondly, it would be an indirect interference with the execution of the judgment in the jurisdiction where the judgment was given and where the judgment can be expected to be obeyed. (d) There is, therefore, an additional requirement to show that there are exceptional circumstances that warrant the exercise of the court's jurisdiction. Such recognised exceptions include cases of fraud and cases where the applicant had no knowledge that the judgment was being sought until after the judgment was rendered. In ....
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....oft was injuncted from offering, marketing, using or importing any computer software involving use of the EP 667 and EP 384 patents of Motorola. 72. On 14th May, 2012, the Washington District Court granted an anti-enforcement injunction, barring Motorola from enforcing any injunctive relief granted by the German court, with respect to the European patents in issue in the said proceedings, reasoning that (i) the anti-suit injunction proceeding brought before the Washington District Court by Microsoft would be dispositive of the German infringement action filed by Motorola, (ii) there was a possibility of inconsistent judgments and (iii) though Motorola's commitments to the ITU involved approximately 100 patents held by it, the German proceedings were initiated by Motorola only in respect of two of the said patents, seeking injunctive relief in respect of the said two patents before the Washington District Court could adjudicate on the propriety of injunctive relief in the FRAND context, i.e. the precise issue brought before the German court by Motorola, which raised concerns of forum shopping and vexatious litigation. Note was also taken of the fact that Microsoft and Motorol....
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....xatious, which is defined as "without reasonable or probable cause or excuse; harassing; annoying" Black's Law Dictionary (9th edition) Even while the Washington District Court proceedings were underway, relating to the entire portfolio of patents of Motorola, Motorola initiated separate proceedings in Germany for enforcement of two of the said patents. This was regarded, by the District Court, as a procedural manoeuvre designed to harass Microsoft with the threat of injunction and to interfere with the District Court's ability to decide the issues properly brought before it. The Court of Appeal, interestingly, observed that as "although the District Court's interpretation of Motorola's litigation decisions may not be the only possible interpretation, it is not "illogical, implausible, or without support from inferences that may be drawn from the facts in the record", and, therefore, it could not be held "that the District Court abused its discretion at this stage of the Gallo 446 F. 3d. 984, 989 (9th Cir. 2006) analysis". It may be relevant to note that the Court of Appeal did not proceed to examine the correctness of the finding, of the District Court, regarding satis....
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..... 78. Plainly, the present case falls within this last, select, category. 79. There is, to my knowledge, no precedent, in this country, dealing with this category of cases. Of the judgments cited before me by learned Counsel for the parties, the only judgments which deal with "anti-enforcement injunctions", where the applicant seeks injunction of enforcement, against it, of a foreign order, are SAS Institute, Ecobank Transnational Inc. (2016) 1 WLR 2231, Sun Travels & Tours (2019) SGCA 10 and Microsoft Corp.9 80. Referring to "anti-enforcement injunctions" as "anti-anti-suit injunctions" would, in my view, be a misnomer. It would not be correct to equate a prayer for injuncting the opposite party from continuing to prosecute a proceeding pending in a foreign Court, with a prayer for injuncting execution of an order passed by the foreign Court. It would be completely unrealistic for a Court not to recognise the distinction between these two categories of cases. Even on the aspect of immediacy and urgency, there is a fundamental qualitative distinction between them. This is obvious, and I need hardly dilate on the topic. In plain speak, there is really no comparison between ....
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.... a restraint against execution or enforcement, by the defendants, of the order dated 23rd September, 2020, passed by the Wuhan Court, and (ii) whether a case for injuncting the defendants from prosecuting the anti-suit injunction application, filed by them before the Wuhan Court, in which the order dated 23rd September, 2020 came to be passed, could be said to have existed, had the plaintiffs approached this Court when the application was still pending. Issue (ii) retains relevance, even though the anti-suit injunction application filed by the defendants before the Wuhan Court stands disposed of, for the simple reason that, owing to the filing and dependency of the anti-suit injunction application having never been disclosed to the plaintiffs by the defendants, despite ample opportunities in that regard having existed, the plaintiffs were denied an opportunity to seek any restraint against the defendants proceeding with the application, or even from contesting the application in Wuhan. This has resulted in the order dated 23rd September, 2020, being passed by the Wuhan Court. The defendants have, therefore, resorted to unfair practice in securing the order dated 23rd Se....
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....Institute (2020) EWCA Civ 599 did not subscribe to the view that anti-enforcement injunctions were to be granted only in exceptional cases. In my considered opinion, the entire discussion of whether the case before the court is, or is not, "exceptional" may have had significance at some prior point of time but has, by now, become somewhat disingenuous, not to say anachronistic. Plainly said, at the end of the day, the interests of justice must prevail. If rendering of justice, in a given case, requires an anti-enforcement injunction to be issued, the Court should not hold back its hands, on some perceived notion of lack of "exceptionality" in the case. This would result in perpetuation of injustice. Justice, it is well settled, is the highest to which the law can attain. 85. The three principal decisions of the Supreme Court, on the aspect of anti-suit injunctions, are O.N.G.C. (1987) 1 SCC 496, Modi Entertainment Network (2003) 4 SCC 341 and Dinesh Singh Thakur (2018) 17 SCC 12. 86. These decisions have already been examined earlier in this judgment. O.N.G.C. (1987) 1 SCC 496 provides a textbook example of when continuation of the proceedings in the foreign Court, or any ord....
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....spute, from Modi Entertainment Network (2003) 4 SCC 341, are that anti-suit injunctions are ordinarily to be granted where the foreign proceedings are "oppressive or vexatious", or where declining injunction would result in defeating the ends of justice and perpetuating injustice. 87. An important decision on anti-suit injunctions, specifically in the context of patent infringement, was rendered by a Division Bench of this Court in Magotteaux Industries Pvt. Ltd. v. AIA Engineering Ltd. 2008 (155) DLT 73 (DB). This decision, too noted the fact that where the nature of the litigation was patent infringement, the principles in Modi Entertainment Network (2003) 4 SCC 341, relating to contractual disputes and the existence of exclusive jurisdiction clauses therein. The suit filed in this Court, and the complaint filed in the US Court, in Magotteaux Industries 2008 (155) DLT 73 (DB), were both actions against infringement of patents, the Indian action being directed against alleged infringement of Indian patents and the US action being directed against alleged infringement of US patents. This Court held, in paras 57 and 58 of the report, that the courses of action propelling the Indi....
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....o the respondent does not appear to be correct, it is also noticeable that since the patent law is territorial in nature, therefore, the infringement caused in different countries where the patents are registered and monopoly rights are granted, will lead to a separate cause of action and the mere fact that the appellants has brought one suit of civil nature before this Court for the violation of the patent rights in India will not lead to the conclusion that a party is debarred from filing any action restraining the misuse of the patent/monopoly rights, which are granted in the jurisdiction of some other court." (Emphasis supplied) 88. Useful markers, to guide the Court seized with the issue of grant, or not grant, of an anti-suit injunction or an anti-enforcement injunction, are also to be found in other Indian decisions, as well as overseas decisions, on which learned Senior Counsel have relied. Though, no doubt, Indian Courts, including the Supreme Court, have pronounced on the circumstances in which anti-suit injunctions may be granted, sufficient room for play in the joints still remains, in view of the use of the words "oppressive", "vexatious" and "interests of ....
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....] UKSC 37 The only practical relief available to an SEP holder was by way of anti-infringement action. Ref. IPCom v. Lenovo (2019) EWHC 3030 (Pat) The right to seek legal redressal, against infringement, was a fundamental right. Ref. Lenovo (US) v IPCom RG 19/21426 - No Portalis 35L7-V-B7D-CBAZK A proceeding, or an order, which resulted in divesting the patent holder of the authority to exercise this fundamental right, was ex facie oppressive in nature. Ref. Ecobank (2016) 1 WLR 2231, SAS Institute (2020) EWCA Civ 599 Protection of the jurisdiction of the Court is also a guiding factor. 104. Jurisdiction No suit for declaration under section 105 or for any relief under section 106 or for infringement of a patent shall be instituted in any court inferior to a District Court having jurisdiction to try to suit: Provided that where our counter-claim for revocation of the patent is made by the defendant, the suit, along with the counter-claim shall be transferred to the High Court for decision." (vi) Comity, as a concept, was grating to the ear, when it proceeded from a court of justice. Ref. Satya Ref. Satya 1975) 1 SCC 120&n....
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....o quickly or too secretly to enable the applicant (seeking injunction) to take pre-emptive remedial measures, including by way of applying for anti-suit injunction while the proceeding was pending, (b) where the order, of the execution of which injunction was sought, was obtained fraudulently, (c) where the applicant seeking anti-enforcement injunction had no means of knowing of the passing of the judgment or order against, until it was served on him. Ref. Ecobank (2016) 1 WLR 2231, SAS Institute (2020) EWCA Civ 599 Sun Travels & Tours (2019) SGCA 10, on which Mr. Kaul relied, in fact, even while opining that anti-enforcement injunctions could be granted only in exceptional cases, recognised these three circumstances as justifying grant of anti-enforcement injunction as, in these circumstances, "the equities of the case (lay) in favour of grant of anti-enforcement injunction." 89. The entire controversy in the present case may be divided into two aspects; firstly, whether the Wuhan Court was justified in granting anti-suit injunction, vide its order dated 23rd September, 2020, and, secondly, whether this Court would be justified in injuncting....
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.... and development, production and sales base were in China, one of the affiliated defendants was located in Wuhan and the place of implementation of the plaintiff's SEPs by the defendants was in Wuhan, the Wuhan Court was possessed of jurisdiction to deal with the matter. All parties were, therefore, required to cooperate with the Wuhan Court. (iii) However, the acts of the plaintiff indicated disrespect to the procedure of the Wuhan Court and their intent to interfere with the said proceedings. (iv) The behaviour of the plaintiffs had caused great damage to the overseas market of the defendants and their affiliates. (v) Despite having been forwarded copies of the complaint filed by the defendants in the Wuhan Court, evidence materials, court summons and other procedural documents, by email, on 11th August, 2020 and the 2nd September, 2020, the plaintiffs refused to respond or reply thereto. (vi) Instead of respecting and coordinating with the Wuhan Court to proceed with the litigation procedures, the plaintiffs started emergency initiation of injunction procedures before this Court to exclude the jurisdiction of the Wuhan Court and counteract....
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....(ix), (x) and (xi) are, with respect, not considerations relevant for grant of anti-suit injunction, either according to the anti-suit injunction law as it exists in this country, or, for that matter, the anti-suit injunction law as it exists in any other jurisdiction. Mr. Kaul has not been able to refer to any decision which would justify the grant of anti-suit injunction, as granted by the Wuhan Court, on the ground that (i) the plaintiff's behaviour had caused great damage to the overseas market of the defendants, or that (ii) the present proceedings would impact conclusion of an SEP license agreement between the plaintiffs and the defendants, or that (iii) they would impact the operation of the defendants and their affiliated companies in the Indian market, resulting in harm to the interests of the defendants, irreparable or otherwise, or that (iv) they would imperil the positive development of the licensing negotiation between the parties, thereby harming the defendant's interests, or that (v) the plaintiffs are, allegedly, NPEs (which finding Mr. Banerjee emphatically refutes), or that (vi) the plaintiffs were seeking prior profits by FRAND licensing negotiation and l....
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....fs do not seek to injunct the proceedings in the said complaint. The alleged lack of response, by the plaintiffs, to the notice issued in the said complaint, the justification thereof, and the consequences of such alleged failure to respond, if any, are matters relevant to the complaint and the proceedings in the complaint, and not to the anti-suit injunction application filed by the defendants in the said complaint before the Wuhan Court. 94.3. Notice, in the main proceedings, quite obviously, does not amount to notice in every application filed therein. Nor can a litigant, who is not clairvoyant by nature, be expected to have knowledge of every application filed in the main proceeding, merely because he has been put on notice in that main proceeding. The order of the Wuhan Court does not record any notice having been issued to, or served on, the plaintiffs, of the anti-suit injunction application filed by the defendants in those proceedings. Though notice is stated to have been issued, twice, to the plaintiffs, first on 11th August, 2020 and, thereafter, on 2nd September, 2020, these are, expressly, "of the complaint, evidence materials, procedural documents and court summons"....
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....he plaint, is manifested in para 26, which avers that "all products of the defendants, which implement those aspects of the 3G and 4G standards to which the plaintiff's patents are essential" infringe the plaintiff's sole and exclusive rights over the said patent. Thereafter, the plaint enumerates, by way of example, specified handsets of the REDMI NOTE 8, REDMI K20 PRO, Mi A3, REDMI NOTE 7 PRO and REDMI NOTE 8 PRO handsets of the defendants as specifically infringing the plaintiffs' SEPs, as is apparent from the advertisements relating to the said handsets and descriptions of the specifications thereof, which implement the standards to which the plaintiff's SEPs are essential. "This fact alone", alleges the plaint, "qualifies as proof of infringement by the defendants", who "have made use of technology which is specifically covered by the plaintiffs' claims in the suit patents". Use of technology covered under claims which are essential to a particular standard, asserts the plaint, requires the entity using the technology to secure a license from the owner of the patents, which the defendants have been unwilling to do, on FRAND terms and conditions. This, asser....
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....ons follow, resulting in the defendants alleging that "the royalty rates for the relevant wireless communication SEPs offered by InterDigital (were) obviously too high, which violate(d) FRAND licensing obligations". Exception has also been taken, into the complaint, to the refusal, by the plaintiffs, to disclose the basis on which they had worked out the royalty rates. The relevant paras from the complaint, with which, in fact, the complaint concludes, and which constitute the basis of the cause of action set out therein, read thus: "The royalty rates for the relevant wireless communication SEPs offered by InterDigital are obviously too high, which violate FRAND licensing obligations. Moreover, in the licensing negotiations, InterDigital refused to compromise, and consistently insisted on royalty rates that violate FRAND terms. First, InterDigital has not disclosed the royalty rates it referred to when calculating the royalty rates offered to Xiaomi. Although Xiaomi had asked for the calculation methods and relevant referred comparable agreements for several times, InterDigital refused to provide any explanation on the ground of the confidentiality clauses in othe....
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....ate that, in order to utilize the 3G and 4G technologies in accordance with the standards set by the SSOs, the plaintiff's patents are "essential", that they can be regarded as SEPs at all. Once they are regarded as SEPs, the next issue for consideration would be whether the defendants are, in their handsets, utilising the plaintiff's patented technology, as would require the defendants to obtain a license from the plaintiffs. It is only if this question is also answered in the affirmative that the issue of the appropriate royalty rates, at which the plaintiffs would be obligated to license the SEPs, to remain in conformity with their FRAND obligations, would come up for consideration. There is substance in the contention of Mr. Banerjee, therefore, that the issue of FRAND royalty rates arises, in the present case, only as a part of the entire gamut of the controversy before this Court. 99. It is obvious, at a bare glance, that the issue of infringement, by the defendants, of the suit patents or, for that matter, of any of the patents of the plaintiffs, is not going to be addressed by the Wuhan Court, while adjudicating the defendants' complaint; or, at any rate, tha....
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....nt, by the defendants, of the Indian suit patents of the plaintiffs. With greatest respect to the Wuhan Court, therefore, it appears, to me, that the order dated 23rd September, 2020, falls into error in opining that the plaintiffs had, by initiating the present proceedings before this Court, sought to exclude the jurisdiction of the Wuhan Court. Rather, the Wuhan Court has, by its order, sought to exclude the jurisdiction of this Court to adjudicate on the lis brought before it by the plaintiff which this Court, and no other, is empowered to adjudicate, as is explained in a little greater detail hereinafter. 101. Nor is there any possibility of interference, by the plaintiffs in the present proceedings, or by the present proceedings themselves, with the proceedings pending before the Wuhan Court in connection with the complaint filed by the defendants before it (in which respect the observations and findings in IPCom v. Lenovo (2019) EWHC 3030 (Pat) (supra) apply, mutatis mutandis, to the present case. I agree with Mr. Banerjee in his contention that the degree of overlap-and, for that matter, the nature of overlap-between the present proceedings and the Wuhan proceedings is no....
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....e Wuhan Court, could be said to arise. That overlap, if and when it may arise cannot, in my view, constitute a legitimate basis for the Wuhan Court restraining the plaintiffs from prosecuting their application for injunction against infringement of the suit patents, either at the interlocutory or at the final stage. It need hardly be stated that every overlap of issues cannot justify an anti-suit injunction. 104. I also have my reservations regarding whether the mere possibility of conflicting orders being passed could be a ground for a Court, in one sovereign country, to injunct proceedings before the Court in another, over which it has no dominion at all. I have not come across any decision which justifies this. To my mind, a step so extreme as an anti-suit injunction cannot be justified on a mere apprehension of the possibility of conflicting orders, were proceedings in both jurisdictions to be allowed to proceed. Assuming, for the sake of argument, that one of the Courts were to arrive at a decision prior in point of time to the other, it would always be open to the latter Court to follow, or distinguish, the decision of the former, or take a different view. The defendants d....
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....business, or where the cause of action arises, wholly or in part. Indeed, it is not disputed, even by the defendants, that the present suit, seeking injunction against infringement of the plaintiff's Indian suit patents IN 910, IN 912, IN 719, IN 036 and IN 182, could not have been maintained before any court outside India. Nor do the defendants dispute the territorial jurisdiction of this Court, to adjudicate and decide the present suit. 105.2. Clearly, therefore, the order, dated 23rd September, 2020, of the Wuhan Court, injuncts the plaintiff from prosecuting its suit and application for injunction, against infringement of the suit patents, which are amenable only to the jurisdiction of this Court. In other words, what has happened in the present case is that a foreign court has restrained the plaintiff from prosecuting a proceeding which is maintainable before this Court, and could not be maintained before any other Court. 106. The Wuhan Court does not have the jurisdiction to grant the relief sought by the plaintiff in IA 6440/2020. The result of allowing the anti-suit injunction order passed by the Wuhan Court to be enforced by the defendants against the plaintiff w....
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.... be prevented, therefore, is assault on the intellectual property integrity of the holder of the intellectual property. The defendants have not chosen to undertake not to use the technology, involving the allegedly infringed suit patents, during the pendency of the Wuhan proceedings. What the defendants suggest is, therefore, that the plaintiffs should sit back and helplessly watch continued infringement of their suit patents by the defendants (as the plaintiffs would allege) without being able to lift a finger to prevent it, even while legal remedies, for redressal, continue to remain available in this country under the Patents Act. This would, clearly, render the Patents Act, and the statutory guarantees available thereunder, both otiose and impotent. Damages are but poor solace, once the damage itself is done. 108. For this reason, the submission of Mr. Kaul that, in order to avoid an "unseemly race" to obtain a decree, the prayer for anti-enforcement injunction of the plaintiff sought to be rejected, fails to impress. The question of an "unseemly race" would arise where the nature of the reliefs sought by the plaintiffs in the defendants is similar. It is not so in the prese....
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....would amount to an assault on the rights of the litigant before the latter court and, in the absence of cogent and convincing material to indicate that the continuation of the proceedings before the latter Court would be oppressive or vexatious to the proceedings pending before the former, would be totally unjustified in law. Injunction against enforcement thereof would, therefore, in my view be eminently justified. My concluding view 110. In my view, therefore, it is totally impermissible for a Court in one sovereign jurisdiction to injunct the party before it from pursuing its cause against infringement of its intellectual property before another sovereign jurisdiction, where such latter jurisdiction is the only forum competent to adjudicate the claim of infringement, save and except where continuation of the infringement proceedings are vexatious or oppressive to the proceedings pending before the former, injuncting, court. The mere fact that one or other aspect of the controversy may overlap cannot be a ground to grant such injunction. Nor can the consideration of the two courts arriving at differing decisions on that part of the issue which may overlap be regarded as suf....
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....sence of any reference to the anti-suit injunction application filed in the said proceedings. After the anti-suit injunction application was filed, the present proceedings were listed before this Court on as many as six occasions, before passing of the ad interim order, in the present application, on 9th October, 2020, but the respondents never disclosed the fact of filing of the anti-suit injunction application. A transparent intent, to keep the plaintiffs, as well as this Court, in the dark, regarding the filing of the anti-suit injunction application, and the passing of the order, thereon, it is apparent. In my view, such an attitude, in a commercial litigation such as the present-or, for that matter, in any proceeding in a court-is completely intolerable. It amounts to fraud on the Court as well as material concealment from the plaintiffs. Even on this sole ground, I am convinced that the defendants deserve to be injuncted from enforcing, against the plaintiffs, the order dated 23rd September, 2020, of the Wuhan Court, passed in such circumstances. 115. The inaction, on the part of the plaintiffs, in responding to the summons issued by the Wuhan Court in the complaint of the....
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....n the event of the Wuhan Court directing payment of the fine by the plaintiffs, indemnify the plaintiffs by directing deposit, by the defendants, of the amount so directed by the Wuhan Court with this Court, so that the plaintiffs could withdraw the amount and stand recompensed. This follows as a natural corollary to the restraint, of the execution of the Wuhan Court order against the plaintiffs, on plain principles of restitution. 117. Additionally, the direction for such indemnity, by the defendants in favour of the plaintiffs, would also be justified in view of the fact that the defendants have resorted to unfair practice in securing the order from the Wuhan Court, keeping the plaintiffs, as well as this Court, in the dark, throughout. The financial implications of this direction are, no doubt, prohibitive but, if the Wuhan Court, towards enforcement of its anti-suit injunction order, directs payment of the fine, the brunt has to be borne either by the plaintiff or the defendants. Given the findings heretofore, it would be the defendants who have to suffer. The troika considerations 118. Applying the troika test of prima facie case, balance of convenience and irreparabl....