A 230-page judgment has been delivered by Hon’ble Justice Shri Sanjeev Narula of the Delhi High Court on 20th February 2025 in the case of Koninklijke Philips N.V. Vs. Maj (Retd) Sukesh Behl & Ors., Case No.: CS(COMM) 423/2016, Neutral Citation: 2025:DHC:1144. The judgment extensively deals with patent infringement in the context of Standard Essential Patents (SEPs). The ruling provides a comprehensive interpretation of Indian patent law concerning SEPs, addressing key issues such as compliance with licensing obligations, the validity of patents, and the enforcement of patent rights against infringing entities. 

This landmark decision not only clarifies the legal position on SEPs but also sets a significant precedent for future cases concerning the licensing and use of standardized technologies in India. The case delves into the essentiality of patents in industry standards and emphasizes the responsibilities of manufacturers in obtaining licenses under Fair, Reasonable, and Non-Discriminatory (FRAND) terms. With an in-depth analysis of claim construction, infringement assessment, and international jurisprudence, this judgment marks a pivotal moment in India's approach to SEP enforcement and patent litigation.

Introduction:
Standard Essential Patents (SEPs) play a crucial role in technological advancements, particularly in industries where interoperability and uniformity are key. SEPs are patents that claim inventions essential for implementing a standardized technology, making it impossible to manufacture compliant products without using the patented technology. The present case, Koninklijke Philips N.V. Vs. Maj (Retd) Sukesh Behl & Ors., revolves around the enforcement of SEP rights in the context of DVD technology and the obligations of manufacturers under Indian patent law. This case sets an important precedent in determining patent infringement, compliance with licensing obligations, and the legal framework surrounding SEPs in India.

Factual Background:
Koninklijke Philips N.V. (Philips) is a globally recognized company with a significant portfolio of patents in the consumer electronics industry. The present case pertains to Indian Patent No. 218255, which covers a ‘Method of Converting Information Words to a Modulated Signal’ and is integral to the Eight-to-Fourteen Modulation Plus (EFM+) coding used in DVDs. Philips alleged that the defendants, engaged in large-scale DVD replication, used its patented technology without obtaining the necessary license. The defendants included multiple entities—Pearl Engineering, Powercube Infotech, and Siddharth Optical—who were involved in DVD replication and distribution. Philips argued that the suit patent was an SEP as it was essential to the DVD standard set by the DVD Forum, an international consortium responsible for defining DVD technology specifications.

Procedural Background:
Philips filed three separate suits against different defendants, which were later consolidated due to substantial similarities in legal and factual issues. The defendants filed counterclaims challenging the validity of the patent and arguing that they did not infringe upon it. The proceedings involved multiple procedural orders, including applications under Order XII Rule 6 of the Code of Civil Procedure for judgment on admissions, which were dismissed. The defendants sought revocation of the suit patent under Section 64 of the Patents Act, citing non-compliance with Section 8 obligations regarding foreign patent disclosures. The Supreme Court, in an earlier stage of litigation, ruled that revocation under Section 64(1)(m) required proof of intent to deceive. The trial included detailed expert testimony on the technical aspects of DVD replication and the essentiality of the suit patent.

Issues Involved in the Case:
The primary issues before the court included whether Philips was the rightful proprietor of the suit patent, whether the suit patent was invalid due to lack of novelty and failure to disclose corresponding foreign applications, whether the defendants had infringed upon the suit patent by replicating DVDs using the EFM+ technology, and whether Philips was entitled to damages for the alleged infringement. The court also examined whether the suit patent qualified as an SEP and whether the defendants' manufacturing process fell within its scope.

Ericsson v. Intex Technologies, (2016) SCC OnLine Del 4064
This case established that SEPs are enforceable in India and clarified that licensing must adhere to FRAND terms. The court in Philips v. Behl referred to this judgment to assert that Philips’ licensing practices were aligned with global FRAND principles and that the defendants could not claim an anti-competitive stance without engaging in licensing discussions.

BSNL v. Telefonaktiebolaget LM Ericsson, (2018) SCC OnLine Del 936
This ruling affirmed that SEP holders have the right to seek injunctions and damages for infringement, even when FRAND negotiations are ongoing. The court applied this principle to reject the defendants' argument that Philips should have exhausted licensing negotiations before initiating litigation.

F. Hoffmann-La Roche Ltd. v. Cipla Ltd., (2012) SCC OnLine Del 1623
The case underscored the importance of sufficiency of disclosure in patent specifications. The court in the Philips case relied on this judgment to reject the defendants’ claim that the patent lacked sufficient disclosure, ruling that the specification adequately enabled a person skilled in the art to implement the invention.

Chemtura Corporation v. Union of India, (2009) SCC OnLine Del 4590
This case dealt with the issue of non-disclosure of foreign patent applications under Section 8 of the Patents Act. The court held that non-disclosure does not automatically invalidate a patent unless fraudulent intent is proven. The Philips case applied this reasoning to dismiss the defendants’ claim that non-disclosure of corresponding foreign applications in Malaysia, Turkey, and Taiwan should lead to patent revocation.

Ravi Kamal Bali v. Kala Tech and Ors., (2008) SCC OnLine Del 707
This ruling emphasized the burden of proof in establishing patent infringement. The court in Philips v. Behl applied this principle by placing the burden on the defendants to prove that their replication process did not infringe upon the suit patent.

Microsoft Corporation v. Motorola Inc., 795 F.3d 1024 (9th Cir. 2015)
An international precedent where the court outlined the framework for determining FRAND royalty rates. The Delhi High Court referred to this judgment while assessing Philips’ claim for damages and determining a reasonable royalty rate.

Claim Construction and Evaluation of Defendants’ Replication Process:
The court undertook a detailed claim construction analysis to determine whether the defendants’ DVD replication process fell within the scope of the patented invention. It interpreted the claims of the suit patent in light of the technical specifications, emphasizing the role of EFM+ modulation in converting information words to a modulated signal. Philips demonstrated through expert evidence that the fundamental steps outlined in the patent claims were embedded in the DVD production process, making it impossible for the defendants to replicate DVDs without infringing on the patent.

The defendants argued that their replication process merely involved copying pre-encoded stampers, which contained pre-existing modulated signals. However, the court noted that the replication process itself involved the reproduction of the patented technology, as the modulation was an inherent part of the final replicated DVDs. The forensic analysis conducted on samples of DVDs produced by the defendants confirmed the presence of EFM+ encoding, reinforcing Philips’ assertion of infringement.

Non-disclosure of corresponding foreign applications under Section 8 of the Patents Act: The court addressed the defendants' challenge regarding non-disclosure of corresponding applications in Malaysia, Turkey, and Taiwan under Section 8 of the Patents Act by emphasizing that revocation under Section 64(1)(m) requires proof of deliberate suppression or fraudulent intent. The court analyzed Philips’ disclosures to the Indian Patent Office and found that while certain omissions had occurred, they were not intentional misrepresentations but administrative lapses.

The court cited Chemtura Corporation v. Union of India (2009) SCC OnLine Del 4590, which held that mere failure to disclose foreign applications does not automatically lead to revocation unless there is clear intent to mislead the patent authorities. The ruling reaffirmed that procedural lapses in disclosure do not invalidate a patent unless they are shown to be intentional acts of fraud. The court, therefore, rejected the defendants’ claim and upheld the validity of the patent. Let me know if you want this reasoning incorporated into your document.

Insufficiency of disclosure in specification:The court addressed the defendants' argument regarding insufficiency of disclosure in the patent specification by analyzing whether the complete specification provided adequate information for a person skilled in the art to practice the invention. The defendants contended that the patent did not sufficiently describe the method in a clear and enabling manner, making it inoperative. However, the court held that the disclosure was adequate as it provided detailed steps for converting information words to a modulated signal, a process integral to DVD replication.

The court referred to F. Hoffmann-La Roche Ltd. v. Cipla Ltd. (2012) SCC OnLine Del 1623, where it was held that a patent specification must be read as a whole to determine sufficiency. Applying this principle, the court found that the defendants failed to establish that a skilled person could not implement the invention based on the provided disclosure. Expert testimony presented by Philips confirmed that the specification met the sufficiency requirement under Section 64(1)(h) of the Patents Act. The court ultimately ruled that the patent specification was not vague or insufficient, thereby rejecting the defendants’ challenge.

Objection under Section 3(m) and Section 3(k) of the Patents Act, 1970: The defendants objected to the suit patent under Section 3(m) and Section 3(k) of the Patents Act, 1970. Section 3(m) excludes patents on methods of playing a game or performing a mental act, while Section 3(k) prohibits patents on computer programs per se, algorithms, or mathematical methods.The defendants argued that the suit patent covered a mere algorithm used in digital encoding and, therefore, was barred under Section 3(k). They further contended that the method described in the patent involved mental steps, making it ineligible under Section 3(m).

The court rejected these arguments, holding that the patent did not merely claim an abstract algorithm but rather a technical process implemented in hardware for encoding data in DVDs. The court relied on precedents such as Ericsson v. Intex Technologies (2016) SCC OnLine Del 4064, which distinguished between software-driven inventions and patentable technical applications. It ruled that the suit patent contributed to a tangible technical advancement in digital storage, making it eligible for patent protection.

Objection under 64 1(d) and 64 1 (k) of Patent Act 1970:The defendants objected to the suit patent under Section 64(1)(d) and 64(1)(k) of the Patents Act, 1970. The defendants argued that the patent was not an invention under the Patents Act, as it merely involved a method of encoding data that lacked inventive step and did not result in a technical advancement. They further contended that the patent fell within the exclusions of Section 3(k), which prohibits patents on mathematical methods and algorithms.

The court rejected these arguments, stating that the patent did not merely cover an abstract mathematical concept but provided a tangible and technical advancement in data encoding used in DVDs. The court referred to Ericsson v. Intex Technologies (2016) SCC OnLine Del 4064, which held that patents on technical solutions in telecommunications were not barred under Section 3(k). Similarly, the court found that the suit patent involved a technical application and could not be invalidated under Section 64(1)(d) or 64(1)(k).

Key Legal Principles Laid Down in This Case:
This case establishes several critical legal principles related to SEPs in India. The court affirmed that SEPs are enforceable rights, and manufacturers using standardized technology must comply with licensing obligations. The decision reinforces that non-disclosure of foreign patent applications does not automatically invalidate a patent unless fraudulent intent is proven. It further clarifies that indirect infringement, such as through the replication of pre-encoded stampers, still constitutes infringement if the final product embodies the patented technology. The ruling upholds the importance of FRAND licensing but also emphasizes that failure to obtain a license does not absolve a party from liability for infringement.

Impact of This Case on Future SEP Litigation:
The ruling in this case sets a strong precedent for future SEP litigation in India. It provides clarity on how courts should evaluate infringement claims related to SEPs and reinforces the responsibility of manufacturers to obtain appropriate licenses. The case highlights the necessity of forensic examination and expert testimony in determining SEP infringement. Moving forward, this decision will guide both patentees and implementers in understanding their rights and obligations concerning SEPs, ensuring fair competition and compliance with intellectual property laws in standardized industries.

Disclaimer: The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor - Patent and Trademark Attorney
Email: ajayamitabhsuman@gmail.com, Ph no: 9990389539