In the intricate realm of intellectual property law, jurisdictional disputes often serve as the gatekeepers to substantive justice. The case of Matrix Laboratories Limited versus F. Hoffmann-La Roche Ltd., decided by the Madras High Court on December 1, 2011, exemplifies this tension. At its core, this legal battle revolves around the question of whether the Madras High Court possessed the territorial jurisdiction to entertain a patent infringement suit concerning Indian Patent No. 196774 for Erlotinib Hydrochloride?

What began as a quia timet action—a preemptive strike against a perceived threat—escalated into a rigorous examination of cause of action, statutory interpretation, and judicial discretion. This case study explores the factual and procedural underpinnings, the legal issues at play, the arguments advanced by both parties, the judicial precedents invoked, and the court's ultimate reasoning, offering a deep dive into a pivotal moment in Indian patent jurisprudence.

Detailed Factual Background:
The respondents, F. Hoffmann-La Roche Ltd. (a Swiss multinational pharmaceutical company) and OSI Pharmaceuticals, Inc. (a U.S.-based entity), jointly held rights to Indian Patent No. 196774 for Erlotinib Hydrochloride, a compound marketed as TARCEVA for treating lung and pancreatic cancer. The patent's journey began with an application filed by Pfizer Products, Inc. on March 13, 1996 (No. 537/DEL/1996), which was assigned to OSI Pharmaceuticals and Pfizer Products, with Roche as the exclusive licensee. The patent was granted on July 6, 2007, effective from February 23, 2007, after surviving a pre-grant opposition by Natco Pharma Limited, which was dismissed on July 4, 2007. No post-grant opposition under Section 25(2) of the Patents Act, 1970, had been filed, solidifying the respondents' statutory rights.

The appellant, Matrix Laboratories Limited, a Secunderabad-based Indian pharmaceutical company, entered the fray by filing a revocation petition on April 30, 2010, before the Intellectual Property Appellate Board (IPAB) in Chennai. In this petition, Matrix expressed its intent to commercially produce and market a generic version of Erlotinib Hydrochloride, specifically a novel polymorphic form, asserting that it would not infringe the suit patent but anticipating infringement actions from the respondents. The respondents, alarmed by this declaration and alleging potential clinical trials in Chennai (via Lotus Labs Pvt. Ltd.), filed a suit in the Madras High Court to restrain Matrix from infringing their patent, claiming a substantial part of the cause of action arose in Chennai.

Detailed Procedural Background:

• The respondents initiated C.S. No. 801 of 2010 in the Madras High Court, seeking a permanent injunction against Matrix.
• Since Matrix resided outside the court's jurisdiction, Application No. 5166 of 2010 was filed under Clause 12 of the Letters Patent, and leave to sue was secured on September 16, 2010.
• An ex parte interim injunction was granted the following day.
• Matrix filed Application No. 5529 of 2010 to revoke the leave, claiming no cause of action arose in Chennai.
• The Single Judge dismissed Matrix's application on August 19, 2011, holding the revocation petition filed before the IPAB in Chennai constituted a part of the cause of action.
• Matrix appealed to the Division Bench in O.S.A. No. 365 of 2011, which was heard and decided on December 1, 2011.

• Issues Involved in the Case:
  • Whether the Madras High Court had territorial jurisdiction under Section 104 of the Patents Act and Clause 12 of the Letters Patent.
  • Whether the Single Judge erred in refusing to revoke the leave granted, based on Matrix's revocation petition and alleged clinical trials.
• Detailed Submission of Parties:
  • Appellant - Matrix Laboratories:
    • Contended that filing a revocation petition was a statutory step, not an infringing act.
    • Stated that clinical trials were exempt under Section 107A(a) of the Patents Act.
    • Claimed the patent was granted in Delhi and operations were based in Hyderabad.
    • Argued that the respondents were forum shopping by choosing Chennai.
  • Respondents:
    • Argued that Matrix's revocation petition and clinical trials created a substantial cause of action in Chennai.
    • Pointed to WHO reports of past clinical trials at Lotus Labs in Chennai (2005-2006).
    • Claimed these formed a reasonable apprehension of future infringement justifying quia timet relief.
• Detailed Discussion on Judgments Cited by Parties and Their Context:
  • Frearson v. Loe (1876) F. 134 (Ch D): Cited to support quia timet action for anticipated infringement.
  • Rohtas Industries Ltd. v. Indian Hume Pipe Co. Ltd. (AIR 1954 Pat 492): Addressed continuing threat from past infringement.
  • Mars Inc. v. Kumar Krishna Mukerjee (2003 (26) PTC 60 Del): Defined quia timet action.
  • State of Rajasthan v. Swaika Properties ((1985) 3 SCC 217): Clarified that procedural events do not constitute cause of action.
  • South-East Asia Shipping Co. Ltd. v. Nav Bharat Enterprises ((1996) 3 SCC 443): Reinforced need for defendant's act to constitute cause of action.
  • Rajasthan High Court Advocates' Association v. Union of India ((2001) 2 SCC 294): Defined cause of action as infraction of a right.
  • Union of India v. Adnani Exports Ltd. ((2002) 1 SCC 567): Held that incidental facts like company's registered office don't establish jurisdiction.
  • Kusum Ingots & Alloys Ltd. v. Union of India ((2004) 6 SCC 254): Supported the doctrine of forum conveniens.
• Detailed Reasoning and Analysis of Judge:
  • Confirmed jurisdiction of Madras High Court under Section 104 and Clause 12, but noted leave was necessary since Matrix was based in Secunderabad.
  • Held that the IPAB filing was procedural, not substantive, drawing from Swaika Properties and South-East Asia Shipping.
  • Rejected that Matrix's revocation petition showed intent to infringe; it only established legal standing.
  • WHO report referred to Efavirenz, not Erlotinib, and recent inspections were in Bangalore, not Chennai.
  • Warned against overextending jurisdiction based on IPAB location; emphasized forum conveniens from Kusum Ingots.
• Final Decision:
  • The Division Bench allowed the appeal.
  • Set aside the Single Judge's order dated August 19, 2011.
  • Revoked leave granted in Application No. 5166 of 2010.
  • Dismissed the suit's maintainability in the Madras High Court.
  • Left respondents free to pursue suit in another appropriate court.
  • No costs were awarded; miscellaneous petitions were closed.
• Law Settled in This Case:
  • Filing a revocation petition before the IPAB does not automatically confer jurisdiction on the High Court of the IPAB's registry.
  • Cause of action in patent suits must involve a direct act or threat of infringement, not mere procedural steps or speculative threats.
  • Court may decline jurisdiction under forum conveniens if the nexus is weak, enforcing a fact-specific approach under the Patents Act and Letters Patent.

Case Title: Matrix Laboratories Limited Vs. F. Hoffmann-La Roche Ltd.
Date of Order: December 1, 2011
Case No.: O.S.A. No. 365 of 2011
Neutral Citation: 2011 SCC OnLine Mad 2290
Name of Court: High Court of Judicature at Madras
Name of Judges: Hon'ble Mrs. Justice R. Banumathi and Hon'ble Ms. Justice R. Mala

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