Smriti Yadav, Partner, Khaitan & Co
Shwetank Tripathi, Senior Associate, Khaitan & Co
Bhavik Shukla, Associate, Khaitan & Co
In the matter of FMC Corporation & Anr v Natco Pharma, CS(COMM) 611/2019 (Suit), the Learned Single Judge of the Delhi High Court (Court) passed an order dated 15 July 2020 (Decision) allowing the Plaintiffs (defined hereinafter) to amend the plaint and dismissing various applications filed by the Defendant (defined hereinafter) for dismissal / return / rejection / stay of proceedings in the Suit.
In September 2019, Natco Pharma (Defendant) filed a suit against FMC Corporation & Anr (Plaintiffs) and E. I. Dupont De Nemours & Co, before the City Civil Court, Hyderabad (Hyderabad Suit) for declaration of non-infringement in respect of registered patents bearing IN 201307 for the molecule Chlorantraniliprole (CTPR) and IN 213332 (a process for, inter alia, making the CTPR) (collectively, Suit Patents) and for a declaration that CTPR is covered by the written description of certain prior patents which constitutes prior art and is, therefore, in the public domain, available to anyone who seeks to commercially deal therein.
In November 2019, the Plaintiffs filed the Suit against the Defendant before the Court for infringement of the Suit Patents. The Defendant filed its written statement and also 3 applications for (i) dismissal of Suit under Section 26(2) read with Order VI Rule 15A of the Code of Civil Procedure 1908 (CPC); (ii) rejection of plaint under Order VII Rule 11 of the CPC; and (iii) stay of proceedings in the Suit / return of plaint under Section 10 read with Order VII Rule 10 of the CPC. Subsequently, the Plaintiffs filed two applications, both under Order VI Rule 17 CPC, for certain amendments in the verification and statement of truth of the plaint.
Plaintiffs’ applications for amendment of verification and statement of truth & Defendant’s application for dismissal of the Suit
In the original plaint, certain paragraphs of the plaint were not included in the verification and statement of truth. As such, the Plaintiffs filed an application to include the missing paragraphs in the verification and statement of truth claiming an inadvertent error. The Plaintiffs filed another application to change the date and place of signing of the amended verification and statement of truth.
The Defendant objected to the above applications of the Plaintiffs and had also filed an application for dismissal of the Suit, inter alia, contending that (i) the applications for amendment by the Plaintiffs were belated as the same were filed consequent to the Defendant pointing out errors in the course of arguments; (ii) the amendments were not merely typographical but had a significant bearing on the whole case; and (iii) the amendments sought to change the date and place of signing the verification, which raised a serious question about how any cross examination could be conducted at trial.
Interestingly, though the Court observed that the Plaintiffs had been lackadaisical in drafting the verification and the statement of truth, it allowed the Plaintiffs’ applications as the trial was yet to begin and according to the Court the amendments proposed by the Plaintiffs were not material in nature.
Defendant’s application for rejection/return of plaint and stay of proceedings in the Suit
The Defendant also contended (i) that the Suit was merely a counterblast to the Hyderabad Suit; (ii) the plaint did not disclose any cause of action; and (iii) that the Suit was barred by law in view of the defects in the verification and statement of truth, and hence the plaint should be rejected. However, the Court observed that the facts averred in the plaint clearly disclosed a right in the Plaintiffs to sue, and a cause of action justifying the institution of the Suit.
The Defendant also contended that no part of the cause of action arose within the jurisdiction of the Court as the Defendant was based in Hyderabad and basis the principle of forum non conveniens, the Suit ought to have been filed in Hyderabad. The Court rejected the applicability of the principle of forum non conveniens relying on an order passed by the Court in Horlicks Limited v Heinz India (Pvt) Ltd., where it was held that the principle is not applicable to domestic suits. The Court observed that the Plaintiffs claimed that the infringing goods are likely to be sold in Delhi and it was not the Defendant’s case that it would not be manufacturing or marketing CTPR in Delhi. Thus, the Plaintiffs were entitled to maintain a quia timet action for patent protection resulting in the cause of action arising within the territorial jurisdiction of the Court.
In its attempt to get the plaint ousted at the onset, the Defendant also relied upon Section 10 of the CPC and contended that the proceedings in the Suit ought to be stayed in view of the prior pending Hyderabad Suit. The Court observed that the Defendant was taking inconsistent pleas i.e. while seeking return / rejection of plaint the Defendant contends that the Suit was distinct from the Hyderabad Suit but while seeking stay of the Suit, the Defendant contrarily contends that the Suit was similar to the Hyderabad Suit. While disallowing the application for stay of proceedings in the Suit, the Court observed that the Defendant was resorting to approbate and reprobate and urging conflicting pleas, which is impermissible in law.
Although, the Court permitted the Plaintiffs to amend the plaint in the facts of the case, the Decision entails that a party should be cautious while drafting the verification and statement of truth, otherwise it may significantly scuttle proceedings. The Decision underlines the importance of proper drafting of verification and statement of truth, especially in a commercial suit. Further, the Decision reiterates the principle of law that while a party may take alternative pleas, it is not permissible to take pleas which are conflicting.
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