Philips wins patent battle in Delhi HC

New Delhi: Dutch electronic major Philips has won a major legal battle here with the Delhi High Court ruling that it has a patent right over a channel decoding technology used for DVD video playback function in a DVD player which was infringed upon by two domestic manufacturers.

The high court decreed the two lawsuits filed by Koninklijke Philips Electronics NV against the Delhi-based firms which claimed that they were engaged in manufacture, assembly and sale of DVD video players under various brands.

Philips, which was represented by advocate Pravin Anand, claimed that it was the registered proprietor of IN-184753 which concerns 'channel modulation' which involves a coding step that is performed directly before the storage of the data. This coding ensures that the data to be stored on the disc has a particularly suitable structure for storage.

Justice Mukta Gupta said that Rajesh Bansal and K K Bansal, owners of Manglam Technology and Bhagirathi Electronics respectively, have been infringing upon the Philips suit patent which was an essential standard patent in respect of DVD video player.

Standard essential patents are technologies which are considered standards to be uniformly accepted and implemented across various countries in order to ensure uniformity.

The high court, however, said that no injunction can be granted to the company for the reason that its suit patent expired on February 12, 2015.

"The two suits are decreed in favour of the plaintiff (Philip) and against the defendants holding that the said defendants have been infringing the suit patent IN-184753 which is an essential standard patent in respect of DVD video player, however, no injunction can be granted to the plaintiff for the reason the plaintiff's suit patent expired on February 12, 2015.

"The plaintiff is also found entitled to a decree for recovery from Rajesh Bansal and K K Bansal of royalty payable at FRAND rates, that is, USD 3.175 up to May 7, 2010 and thereafter USD 1.90 up to February 15, 2015 from the date of institution of the suits with interest at the rate of 10 per cent per annum from the end of the month for which royalty is due till the date of payment per video player manufactured/ sold. A decree of punitive damages to the tune of Rs 5 lakh is also passed in favour of plaintiff and against Rajesh Bansal," the judge said.

FRAND is a legal term that stands for "Fair, Reasonable, and Non-Discriminatory" and is typically used to describe patent licensing terms.

The court also ordered inquiry into the number of video player manufactured or sold by Rajesh Bansal and K K Bansal respectively and appointed ADJ (Retd) S M Chopra as the local commissioner to report on the issue.

"The plaintiff shall be entitled to recover the amount so found due and less the amount deposited in this court with interest accrued thereon, on filing the report with the execution petition. The objection if any, to the report of the local commissioner be also filed in execution. The fee of the local commissioner is fixed at Rs 1 lakh to be borne by the plaintiff," the bench said after accepting the argument of Anand and advocate Vaishali Mittal.

Philips Electronics had filed two suits which concerned with Indian Patent No. 184753 on Channel (De)coding technology used for DVD Video Playback function in a DVD video player.

The company had sought permanent injunction and directions to the local manufacturers to provide "complete details, delivery, rendition of accounts, damages, etc".

The manufacturers, however, had said that the major components of the DVD players were procured by the defendants from authorised licensees like Sony, MediaTek, Sanyo, ST Micro etc from China after due payment of all the taxes and custom duties.

The local manufacturers claimed that they were not indulging in infringement of the Philips patent as they purchased the products from the duly authorised licensees of the company.