1. ' This is an application under section 31 of the Patents and Designs Act, 1911, read with Order 39, rule 2 and section 151, C.P.C. Through which the plaintiffs pharmaceutical companies seek restraint against the defendants as regards manufacturing, importing, selling, stocking or marketing any drug or medicine containing ranitidine/ranitidine hydrochloride under the trade name Colfax or any other name. In the suit to which such application pertains plaintiff No.1 claims to be the parent company of a group of companies (Glaxo) which are engaged in the discovery, development, manufacture and marketing of safe and effective medicines of high quality. Glaxo is claimed to be one of the world's largest pharmaceutical companies spending huge amounts in research and development. Plaintiff No.2 is stated to be a subsidiary of the plaintiff No.1 whereas plaintiff No.3, also a subsidiary, is registered and functioning in Pakistan.
2. ' It is maintained that the plaintiffs Nos.1 and 2 have patented ranitidine/ranitidine hydrochloride in a large number of countries and in Pakistan patents numbers 126632 and 128137 stand duly registered in favour of the plaintiffs. The brand name given to such invention is Zantac under which name the product is marketed and sold by Glaxo in many countries around the world. The drug is, inter alia, prescribed for duodenal ulcers. The defendant No.1 was found to be importing/manufacturing/selling a drug containing ranitidine as its hudrochloride under the name Melfax. The defendant was duly noticed and subsequently when it failed to desist from violating the plaintiffs' patent rights the present suit was filed. Defendant No.2 represents a sales outlet of the first defendant.
3. ' On being served, the defendants, have preferred a counter-claim for revocation of the above- referred patents. The grounds for revocation, inter alia, are that the two patents involve basically the same formula and specifications, no inventive process was involved therein, the plaintiffs were not the persons entitled for the patents, the product being manufactured locally and sold in the open market in Pakistan since long, the plaintiffs' pricing was exorbitant, other manufactures were engaged in marketing of identical products from whom the defendants were intern importing the same and, finally, because the plaintiff had acquiesced' in the contraventions, if any. Defences to the interim relief sought by the plaintiffs are also essentially similar.
4. ' On the filling of the above application for interim relief an ad interim order was passed restraining the defendants from infringing the patents in question. Such order has been extended from time to time and is to continue till the announcement of orders on such application, which were reserved on 15-11-1990.
5. ' I have carefully examined this case. It is not in dispute that the medicine being marketed by the defendants contains the same ingredients as those comprised in the end-product emerging from the patent specification. It is, however, urged by the defendants that they have been importing the basic material germane to their product from Canada where also-plaintiffs own and possess identical patents and if the patented process of manufacture was being pirated in the country of origin such manufacture could not have taken place at all. Beside, much emphasis has been laid on the question that the plaintiffs have acquiesced in the transgression, if any, and whatever be their rights in the suit they, at least, are not entitled to the interim relief of injunction on grounds of acquiescence, estoppel and laches. It has further been urged that in the context of violations of patented rights, imports, as such, are not precluded. Something was said in defence about the defendants' marketing their product on being licensed under the Drugs Act but, on argument, it was conceded, and rightly so, that registration under'' the Drugs Act, 1976, did not constitute a defence against infringement regulated by the Patents and Designs Act, 1911, the two statutes covering different fields and controlling distinct classes of activities.
6. ' Mr. Child Anwar for the plaintiffs has laid stress on the amount of expense, expertise, labour and planning invariably involved in coming up with inventions qualifying for seeking patents. He has urged that unless due protections are accorded to such rights the result will be an inevitable drawback to pursuit of knowledge and retardation of innovative activity. He is right. However, at the same time, the normally acceptable principles, applied over the years, are to be adhered to since in doing so all interests, many a time conflicting, are equitably and lawfully safeguarded.
7. ' The first question to be addressed in a suit for infringement is whether the formula envolved for the patented invention has or has not been employed in the manufacture of the offending product.
8. The reason is self-evident. It is the process and not the product which is central to the patent.To put it differently, the same invention would qualify for another patent if another mechanism, another procedure, is evolved to manufacture it. This approach assumes greater importance where infringement is alleged against a person who himself is not engaged in working the process but is alleged merely to be instrumental in its sale or use. In such a situation a greater degree of precision is required in the particulars of the alleged breaches. Thus in Mandleberg v. Morley (10 R.P.C. 256), Stirling, J. Said: "Now if a manufacturer is attacked for infringing a patent by a particular process he does not want to be told in the shape of particulars or otherwise what the process is he is using. He knows what the process is he is using. But it is a very different thing with respect to a vendor. The vendor does not know with certainty what process is being used by the person from whom he himself buys, and who manufactures the article". The defendants in this case being mere importers or vendors may thus clearly be entitled to detailed particulars of breach.
9. Another *pea of the matter is as to what precisely are the rights of a patentee which the patentee can seek to protect against infringement or invasion. Section 12(1) of the Patents and Designs Act, 1911, expressly provides that a patent sealed under such Act confers "on the patentee the exclusive privilege of making, selling and using the invention throughout Pakistan and of authorising others to do so". Ensuing section 29(1) of the same enactment, governing suits for infringement, postulates that such a suit may be instituted against any person who "makes, sells or uses the invention" without licence or "counterfeits it, or imitates it". Placing these provisions together and reading them accordingly, it leaves no manner of doubt that Act II of 1911 does not preclude the import of the patented invention from a country outside Pakistan, it being almost irrelevant as to who manufactures it beyond the limits of the capital and the territories of the Federation. The vital question, however, still remains whether, if proved or established on admission, that such manufacturer is other than the patentee in Pakistan, the end-product, if sold on import in this country, would make a suit for infringement competent. Much would depend on how sections 12(1) and 29(1) of the Patents and Designs Act, 1911, are interpreted in the context of the ingredients "makes, sales or uses". In other words, whether each one of such acts are actionable per se and in isolation or only when they are considered either together or relative to the antecedents or incidents. At this stage, it is neither necessary nor proper to decide that question. However, on facts, it must be stated that according to MrAta-ur-Rehman, for the defendants, the allegedly contravening imports are taking place from Canada but the manufacturers are admittedly persons other than the plaintiffs here. Correspondingly, learned counsel for the plaintiffs has urged that similar patents are also registered in Canada though the products in that country are marketed under a different system relative to trade nomenclature. On either of these contentions it is clear that the basic violation, if any, is taking place in a foreign country subject to its own patent law and it is a serious question to go to trial whether such infringements outside Pakistan would become actionable, even though import itself may not be precluded, merely on sale, Relevantly, whether transgressions of patent rights enforcible in another country and another jurisdiction can give rise to a cause of action in this country augmented with independent rights of the patente in operation here. Yet another aspect of the matter is that the plaintiffs have sought restraint also against stocking of the alleged product. Clearly in terms either of section 12(1) or of section 29(1) stocking itself is not directly contemplated and would be subject to the same incidents as the imports themselves.
10. ' As to imports and stocking relative to sales in Pakistan I have been referred to two papers apparently read at the "Regional forum on Judiciary and the Intellectual Property System" in a session at Islamabad from October, 5 to 9, 1986. Thus this is what Mr.Patrick Brazil of the Attorney- General's department, Australia, in his paper "Patent Infringement Proceedings" had to say: "In construing claims that Courts are faced with the need to strike a balance between, on the one hand, providing patentees with a surrounding area of protection that safeguards their claims from being evaded by colourable subterfuges and, on the other, protecting the public interest by not unduly extending the scope of patent monopolies."
11. ' Likewise, in the address at the opening ceremony on the same occasion the under-noted is an excerpt from what Mr. Justice Muhammad Haleem, then Chief Justice of Pakistan, had to say on the subject: "Infringement protections extend, inter alia, against those who import the patented or trade marked product from a foreign country. This principle of trade mark and patent law has shown signs of erosion, particularly in the area of trade mark law by exceptions unrelated to the implications of free competition. The corollary principle indicates that if a businessman succeeds in having parallel trade marks in more than one country, certain countries interested in the protection of native products, consider it desirable not to permit the import of similar commodities covered by a parallel trade mark in a foreign country."
12. ' It would he observed that the Patents and Designs Act of 1911 seems to have taken care to ensure that bare import of a patented product does not fall within the mischief of infringement, for if that were not so there was no reason why the legislature would have omitted to expressly say so.
13. ' The next question urged from the side of the defendants was about the necessity of establishing the validity of the patent without which it has been contended that the plaintiffs are not entitled to an interlocutory injunction. Obviously, the defendants in their counter-claim have questioned the validity of the patents in question. However, before me has been placed an order of interim injunction granted in Glaxo Group Limited and others v. Pakistan Pharmaceutical Products (Private)
14. Limited (Suit No.1402/89). Such order covers the same patent. It is, however, doubtful whether such validation, as is thus relied upon, can come about on interlocutory adjudications and that too between different parties. Still, at this stage, I would leave the question at that, available for examination at the time the suit proceeds to trial.
15. ' It has been urged that apart from manufactures taking place in other countries such as Canada similar activities, including sales have admittedly been in operation in Pakistan.The interim order in one such case has already been referred. Another instance cited is of M/s. Ferozsons, about whom Mr. Khalid Anwar, for the plaintiffs, explains that an appropriate suit is going to be filed. Irrespective of merits, it becomes plain that the patents are not being worked without controversy. In the grant of interlocutory injunctions touching patents, it is of very great significance that the patentee has worked and enjoyed the patent uninterruptedly, exclusively and without dispute and besides the user has to be active. On the material available even this question is not beyond controversy. There is some authority also requiring the user to be a prolonged one spreading over the years but such is distinguishable.
16. ' It has repeatedly been observed in patent matters that a question of estoppel may arise in connection with an application for injunction in more than one ways and one of them is that a plaintiff may be estopped by reason of his conduct from making a claim of infringement against the defendants and the consequence of such estoppel is that the interim injunction asked for must inevitably be refused. Corresponding though not equivalent is often the question of acquiescence that may arise on account of conduct which may date back even prior to infringement. In both these contexts it would remain to be examined whether the inaction or delay on the part of the plaintiffs in proceeding against the disputants in and outside Pakistan would be of consequence in the final determination of this action for which, of course, evidence will have to be led. At this stage, it is enough for the purposes of interlocutory relief that prima facie there is an admitted state of things which could be labeled as conduct contributory to the infringement, if any, and estoppel or acquiescence or both may arise on trial.
17. ' Then it was urged that the plaintiffs, in pursuit of their monopoly, have been acting contrary to public interest. By way of instances, it has been pointed out that the plaintiffs are selling a leaf of 10 Zantac tablets at Rs.105 whereas the defendants market the equivalent at Rs.74 per leaf while in India similar product is priced at Rs.18 though plaintiffs are themselves the manufacturers and vendors in that country. Not being able to explain this manifest divergence in prices Mr. Khalid Anwar has attempted to argue that pricing of the product is none of the considerations relative to the Patents and Designs Act. It is true that pricing does not directly enter a dispute involving infringement. However, grant of an interlocutory injunction is an equitable relief and if it is found that a monopoly is being exploited or such privilege, as arises upon the sealing of a patent, is being misused in disregard of public interest such relief can be refused on equitable considerations. In point are more than one decision of the United States Supreme Court where in litigations, involving patent rights, equitable relief has been declined in the face of the privilege having been shown to be used contrary to public interest.
18. ' Much has been said from either side on the question of delay. Learned counsel for the plaintiffs maintains that no distinction exists in relation to delay relevant to interlocutory relief between ordinary civil matters and those involving patent rights. Mrdita-ur-Rehman, for the defendants, on the other hand, has urged that the concept of delay in patent matters stands on a different footing than is ordinarily the case regulating the grant of interim injunctions. It has been shown on long- standing authority that where ancillary to patents litigation an ex parte ad interim injunction restraining infringement is claimed, even a day's delay may be relevant and, as a normal rule, a few months' unexplained delay has consistently been found to be fatal. However, Mr Khalid Anwar relies on a decision of Chitty, J., in North British Rubber Company v. Gormully and Jeffery Company (12 R.P.C. 17) where that learned Judge said that he was not aware having regard to patents that there was any substantial ground of distinction between interlocutory injunction upon a patent right and upon any other. The principle, as it appeared to the learned Judge, was substantially the same and the general rule was that a person who came to ask for that remedy, which was granted with despatch and for the purpose of protecting rights until the trial, should come promptly. I do not see how these observations alter the rule of promptitude. On the other hand, there is plethora of case-law about a real distinction between the degree of despatch required in patent cases as compared to interlocutory reliefs generally in civil litigations.
19. This is not without good reason. Patent rights operate as a bar to productive activity in a given field for specified periods of time. A patent generates a right in rem. Enforcibility of such a right against the whole populace has to be within a strict compass. If, therefore, by his conduct involving inaction a patentee passively allows others to enter his protected area of activity, incur expense or otherwise take a decisive and irreversible step the persons so exposed should suffer real prejudice to attract the dictum of Muhammad Afzal Zullah. J., as he then was, in a Lahore High Court judgment which will presently be examined. In cases of this genus interlocutory relief has to be refused. See Bridsons v. Benecke (12 Bea 1, 3), Bovill v. Crate (L.R.1 Eq. 388) and Greer v. Bristol Tanning Co. (2 R.P.C. 268) etc. ' Now may be referred the decision of the Supreme Court of Pakistan in Ghulam Nabi v.Abdul Hameed (1984 SCMR 845) where the rule laid down, as to the doctrine of laches by Muhammad Afzal Zullah, J., then in the High Court, in Merajuddin v. Senior Superintendent of Police, Lahore (PLD 1970 Lah. 569) was approved. Such rule, to be explicit, is that delay in order to be equated with laches should be such, that on account of lapse of time and other circumstances, it exposes an adverse party to disadvantage of a magnitude resulting in prejudice. It is undoubtedly a rule of general application but has to be applied distinctively in each set of proceedings keeping in view the individual requirements of each. In applying the rule it has also to be kept in view whether the defence of laches is being raised in relation to a cause of action entirely or only pertinent to interim relief and further still, as to the last mentioned, whether it has relevance to the ad interim stage of the proceedings. Considerations, naturally, would be different in each context. In the instant case plaintiffs initially issued notice to the defendants on 6-3-1989 complaining of infringement and required an explanation within a forthnight. None,was rendered. A reminder was addressed on 4-4- 1989 and a further week's time was given. Defendants replied though evasively on 6-4-1989 and, thereafter, the suit was preferred not earlier than on 29-5-1990. Delay is explained on the basis of a cash memo. Dated 19-2-1990 which allegedly fell into the hands of the plaintiffs subsequent to its issuance. Surely on the basis of the referred material the cash memo could not exclusively give rise to the cause of action. The glarink fact is that the infringement was in the knowledge of the plaintiffs as early as on 6-3-1989 and they, more or less, inexplicably took more than a year to file the suit. In view of several authorities on the subject and a recent one of this Court authored by Saeeduz Zaman Sidiqui, J., as he then was viz. Aeg. Telefunken Ltd. v. Electric Concern Corpn. (1985 CLC 150), 1 am of the opinion that such delay, as is spoken of, is fatal to the grant or confirmation of an interim injunction.
20. ' It is by now an established rule that in cases where a serious question is to go on trial an interlocutory injunction is not to be granted. In Plimton v. Malcoimson (L.R. 20 Eq. 38) Jessel, M.R.
21. Said: "When it appears that there is a serious question to be tried at the hearing, it is not the course of the Court to grant an injunction on an interlocutory application."
22. ' Such cases would be governed by the rule spelled out in Halsbury's Laws of England (Fourth Edition), Vol. 35, page 355: "A very common practice is for the defendant to undertake to keep an account until the trial of the action. If an injunction is granted the plaintiff must give a cross-undertaking as to any damages the defendant may suffer should it he held that there was no ground for granting it."
23. ' Appropriate directions, in line with the above, can also be issued by the Court requiring the defendant to maintain accounts relevant to the disputed product and to submit the same periodically to the Court making room, if proper, for the plaintiff to examine the account books and such a course can be adopted so as to protect either side whatever be the ultimate outcome of the proceedings. In this case, it does not appear to be unreasonable to adopt such course. Balance of convenience also lies favouring such discretion. Accordingly, the orders of ad interim injunction earlier passed are recalled. The defendants shall furnish in this suit monthly accounts starting from the 15th of April, 1991, with advance copies to the plaintiffs and continue to do so by and inclusive of the 15th of each succeeding month till the suit is finally disposed of. If at any stage the plaintiffs are not satisfied with the accounts pertaining to the sales of the alleged infringing product they will be free to ask for the inspection of the defendants' account books and such application would be granted without notice to the defendants. In such terms the above application for interim injunction is dismissed.