What the Supreme Court Said in Its Bt Cotton Judgment

Monsanto and Nuziveedu both submitted their arguments in the context of Indian laws and obligations under agreements with the WTO. However, the court said it did not consider it necessary to deal with them.

New Delhi: The Supreme Court on Tuesday set aside a Delhi high court division bench order that said Monsanto’s patent over Bt cotton was not valid and enforceable in India.

The 2018 division bench’s judgment overruled a single-judge order issued in 2017. The division bench held that Nuziveedu Seeds, a Hyderabad-based company, had not infringed on Monsanto’s patent by selling the specialised seeds.

As The Wire reported, the contention centred around the introduction of the Cry2Ab gene from the DNA of a naturally occurring bacterium, Bacillus thuringiensis, into a cotton plant cell to synthesise a nucleic acid sequence. This process breeds a cotton plant variety resistant to bollworms. Monsanto claimed patent rights over the identification of the gene and over the method of inserting the nucleic acid sequence into the plant cell.

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Nuziveedu argued that when a nucleic acid is introduced into any plant cell, Indian law prohibits patenting the cell.

The plaintiffs (Monsanto) and defendants (Nuziveedu) submitted their arguments in the context of Indian laws and obligations under agreements with the WTO. These include the Patents Act, 1970, the Protection of Plant Varieties and Farmers’ Rights (PPVFR) Act, 2001, the General Agreement on Tariffs and Trade (GATT), Trade­ Related Aspects of Intellectual Property Rights (TRIPS) Agreement.

However, the court’s judgment said it did not consider it necessary to deal with them. “In view of the nature of the order proposed to be passed, we do not consider it necessary to deal with the same at this stage, and leave open all questions of facts and law to be urged for consideration in appropriate proceedings,” the judgment read.

Instead, the bench – comprising Justice R.F. Nariman and Justice Navin Sinha – reviewed the Delhi high court division bench’s verdict.

The Delhi high court judgments

It is pertinent that the case was brought before the Delhi high court when Monsanto sued Nuziveedu Seeds, along with Prabhat Agri Biotech and Pravardhan Seeds, seeking an injunction for patent and trademark infringement. A single-judge bench of the Delhi high court allowed Nuziveedu Seeds and other Indian companies to continue using the patented technology until the suit was disposed. The Indian companies were ordered to pay a licensing fee according to government-set rates.

Both parties appealed this verdict before the division bench of the Delhi high court. While Monsanto challenged the reinstatement the license that had been cancelled, the Indian companies challenged the rejection of their arguments about the patent’s validity.

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The division bench ruled that the patents could not be enforced under Indian law and upheld the payment of licensing fee by the Indian companies.

What the Supreme Court said

The Supreme Court on Tuesday said the division bench ought to have “confined its adjudication to the question whether grant of injunction was justified or unjustified in the facts and circumstances of the case”.

It noted:

Summary adjudication of a technically complex suit requiring expert evidence also, at the stage of injunction in the manner done, was certainly neither desirable or permissible in the law. The suit involved complicated mixed questions of law and facts with regard to patentability and exclusion of patent which could be examined in the suit on basis of evidence.

The apex court also said that before a patent is revoked, Section 64 of the Patents Act and the Civil Procedure Code require consideration of the claims in a suit and the counter claims, as well as the examination of expert witnesses and inspection of documents.

“We are therefore satisfied that the Division Bench ought not to have disposed of the suit in a summary manner by relying on documents only, extracted from the public domain, and not even filed as exhibits in the suit, much less examination of expert witnesses, in the facts of the present case,” the verdict read.

The issues raised in the suit are complicated, requiring technological and expert evidence with regard to issues of chemical process, biochemical, biotechnical and microbiological processes. The court said facts, such as if “the nucleic acid sequence trait once inserted could be removed from that variety or not” and “whether the patented DNA sequence was a plant or a part of a plant”, need to be considered at the final hearing.

“The Division Bench ought to have confined itself to examination of the validity of the order of injunction granted by the learned Single Judge only. But we are not inclined to remand the matter for that purpose to the Division Bench as we are satisfied in the facts and circumstances of the case that the nature of the injunctive relief granted by the Single Judge was in order and merits no interference during the pendency of the suit,” the bench said.

Setting aside the order of the division bench, the Supreme Court restored the single judge’s March 2017 order. “The suit is remanded to the learned Single Judge for disposal in accordance with law. In view of the importance of the question involved, we expect the parties to cooperate and facilitate the learned Single Judge in early disposal of the suit,” it said.