Case Summaries

Sunseap Group Pte Ltd & 2 Ors v Sun Electric Pte Ltd [2019] SGCA 04

SUPREME COURT OF SINGAPORE

10 January 2019

Case summary

Sunseap Group Pte Ltd & 2 Ors v Sun Electric Pte Ltd [2019] SGCA 04
Civil Appeal No. 190 of 2017

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Decision of the Court of Appeal (delivered by Tay Yong Kwang JA):

Outcome: CoA rules that High Court has original jurisdiction to hear applications for patent revocation brought by way of defence and counterclaim in infringement proceedings.

Pertinent and significant points of the judgment

  • Where an application for patent revocation is brought by way of defence and counterclaim in infringement proceedings (ie, the alleged infringer challenges the validity of the patent in the course of “defending” itself, and in its counterclaim seeks an order that the patent be revoked), the High Court has original jurisdiction to determine the validity of the patent, by virtue of s 67(1) read with s 82(1)(a) of the Patents Act. If the patent is found to be invalid, the High Court has the power to order that the patent be revoked, pursuant to s 91(1) read with s 80 of the Patents Act: at [65] and [67].
  • Where an application for patent revocation is brought independently of infringement proceedings (ie, the applicant “attacks” the validity of the patent as a stand-alone application), the High Court does not have jurisdiction to determine the validity of the patent, such jurisdiction having been expressly excluded by s 82(2) read with s 82(1) of the Patents Act. Exclusive jurisdiction to determine the validity of the patent in this category of cases is reserved to the Registrar of Patents: at [74]–[75] and [78].
  • In rem jurisdiction is not required in order for the High Court to order that an invalid patent be revoked: at [95]–[96].

1          Civil Appeal No. 190 of 2017 is an appeal arising out of the Respondent’s application to strike out certain portions of the Appellants’ pleadings.

Background facts

2          The Respondent is the proprietor of a patent in respect of a power grid system and a method of determining power consumption at building connections in the system (“the Patent”). The Respondent commenced High Court Suit No 1221 of 2016, in which it claimed that the three Appellants jointly or severally infringed eight out of 12 claims in the Patent (“the Asserted Claims”). In their Defence and Counterclaim (“D&CC”), the Appellants denied all allegations of infringement. One basis for their denial was that the Patent is and has been at all material times invalid, for the reasons set out in the Particulars of Objection. The Appellants sought, among other relief, a declaration of the Patent’s invalidity and an order that the Patent be revoked.

3          Subsequently, the Respondent filed an application to strike out various portions of the D&CC and Particulars of Objection to the extent that the validity of the claims in respect of which no infringement was alleged (“the Unasserted Claims”) had been put in issue improperly. This application was subsequently amended such that in effect the Respondent was asserting that the Appellants could not put in issue the validity of any of the claims of the Patent by way of counterclaim in infringement proceedings.     

4          The application was first heard by the Assistant Registrar (“the AR”). The AR held that the validity of the Unasserted Claims could not be put in issue by way of defence in infringement proceedings, and ordered that the Appellants amend certain paragraphs in the “Defence” section of the D&CC to refer to the invalidity of the Asserted Claims specifically, instead of the invalidity of the Patent as a whole. The AR also held that revocation proceedings could be commenced in the High Court at first instance, particularly where infringement proceedings were already before the High Court and revocation was sought by way of counterclaim. The AR’s decision meant effectively that the Appellants were entitled to put in issue the validity of both the Asserted Claims (by way of defence) and the Unasserted Claims (by way of counterclaim) in infringement proceedings before the High Court. The Respondent appealed to the High Court Judge against the second aspect of the AR’s decision.

5          The appeal came before the Judge, who framed the main substantive question as follows: can patent revocation proceedings be properly brought before the High Court at first instance, by way of counterclaim in infringement proceedings? After analysing the law, the Judge concluded that in the absence of express statutory provisions conferring original jurisdiction on the High Court to hear revocation proceedings by way of application or to grant a prayer for revocation whether or not by way of counterclaim in infringement proceedings, the High Court has no such jurisdiction because such order is in rem in nature. Without such jurisdiction, no powers of the Registrar of Patents (“the Registrar”) in respect of revocation applications under s 80 of the Patents Act, including the power to revoke a patent, could vest in the High Court by operation of s 91(1). Accordingly, the Judge allowed the Respondent’s appeal and ordered, inter alia, the Appellants’ prayer in the D&CC for an order that the Patent be revoked to be struck out.

Decision on appeal

6          The Court of Appeal disagreed with the proposition that the High Court lacks original jurisdiction in all cases to hear applications for the revocation of a patent. The Patents Act envisages two distinct categories of cases involving applications for revocation which are to be dealt with differently.

7          The first category of cases concerns applications for revocation brought by way of defence and counterclaim in infringement proceedings (ie, the alleged infringer challenges the validity of the patent in the course of “defending” itself, and in its counterclaim seeks an order that the patent be revoked). In such a situation, the High Court has original jurisdiction to determine the validity of the patent, by virtue of s 67(1) read with s 82(1)(a) of the Patents Act (at [65]). Upon a finding of invalidity, the High Court has the power to order that the patent be revoked, pursuant to s 91(1) read with s 80 of the Patents Act (at [67]). This power to revoke a patent should be exercised in at least two scenarios: where all the claims in the patent are found to be invalid, or where all the independent claims in the patent are found to be invalid (at [69]–[70]). If there are independent claims the validity of which has not been impugned, the court should not revoke the patent. Instead, the court may allow the proprietor of the patent to amend the specification in such manner and subject to such terms as the court thinks fit (at [71] and [97(c)(ii)]).

8          The above analysis has several practical implications on how a defendant in infringement proceedings should frame its pleadings. First, in its defence, the defendant is limited to challenging only the validity of the claims in respect of which allegations of infringement have been made. Second, in its counterclaim, the defendant may include a prayer for revocation but the precise wording of the prayer would depend on whether all or some of the claims in the patent have been put in issue (at [72]).

9          The second category of cases concerns applications for revocation which are brought independently of infringement proceedings (ie, the applicant “attacks” the validity of the patent as a stand-alone application). In such a situation, the High Court does not have jurisdiction to determine the validity of the patent, such jurisdiction having been expressly excluded by s 82(2) read with s 82(1) of the Patents Act. Original jurisdiction to determine the validity of the patent in this category of cases is vested exclusively in the Registrar. Such an applicant “attacking” the validity of the patent before the Registrar must also be entitled to seek and is seeking relief beyond a bare declaration of invalidity (at [74]–[75] and [78]).

10        The approach set out above is not inconsistent with or contradicted by Parliament’s intention as expressed in the words of the Patents Act, or in the remarks made during various sittings of Parliament, both during and after the enactment of the statute. Parliament’s intention in moving disputes concerning the validity of patents from the courts to the Registry was to save costs in patent litigation. That being the case, Parliament could not have intended that parties in patent proceedings must invariably litigate in two separate fora, before the High Court for infringement proceedings under s 67 and before the Registrar for revocation proceedings under s 80. It makes good sense that where there are infringement proceedings already before the High Court, an application for revocation of the same patent should be heard before the High Court as well (at [86]). However, where the application for revocation is entirely pre-emptive and there are no pending infringement proceedings, there are no cost savings from requiring such applications to be heard in the High Court. Additionally, the fact that Singapore was in a transition period between the self-assessment system to the positive grant system at the time of enactment could also explain why Parliament chose to confer exclusive jurisdiction on the Registrar to hear the second category of cases. The diversion of such cases to the Registrar, a specialised forum with the requisite domain knowledge, would help to build up the Registry of Patents’ expertise and also avoid adding to the caseload of the High Court (at [87]).

11        The Court of Appeal also disagreed with the proposition that the High Court needs to have in rem jurisdiction before it can grant an order revoking an invalid patent. While a claim for patent revocation is an in rem judgment in the sense that it involves the determination of the status of the patent for the purpose of removing it from the register and depriving the patent-holder of the rights in rem bestowed on him as against the world, in rem judgments may arise other than through the court’s exercise of its in rem jurisdiction, which is in any event generally viewed as being limited to its admiralty jurisdiction. The High Court need only have in personam jurisdiction in order to grant an order revoking an invalid patent, and it acquires such jurisdiction once a defendant is served in the manner prescribed in the Rules of Court or submits to the High Court’s jurisdiction (at [95]–[96]).   

12        The present case falls within the first category of cases. Accordingly, the High Court has the jurisdiction to determine the validity of the Patent and if invalidity is established, the court may exercise its power to revoke the Patent. The Court of Appeal thus allowed the appeal, and directed that the D&CC and Particulars of Objection be amended to accord with the legal principles set out at [8] above.

 

This summary is provided to assist in the understanding of the Court’s grounds of decision. It is not intended to be a substitute for the reasons of the Court. All numbers in bold font and square brackets refer to the corresponding paragraph numbers in the Court’s grounds of decision.

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