High Court has jurisdiction to hear patent revocation applications brought as counterclaims in infringement actions: Court of Appeal

Does the High Court have jurisdiction to hear applications for patent revocation, brought by way of defence and counterclaim in infringement proceedings? The final answer is “yes”, ruled a five-judge Court of Appeal on Thursday (10^th January).

With this ruling from the highest court of the land, Sunseap Group Pte Ltd and its subsidiaries, Sunseap Energy and Sunseap Leasing, would be allowed to pursue their counterclaim against solar energy retailer Sun Electric Pte Ltd at trial, in particular to revoke the latter’s patent in respect of a power grid system and a method of determining power consumption at building connections in the system, should the trial court find that the entire Patent was invalid.

In November 2016, Sun Electric brought a patent infringement action against Sunseap, alleging infringement of some aspects of the patent. Sunseap denied the allegations of infringement and counterclaimed for the entire patent, including those aspects that were not infringed, to be revoked on the ground that it is invalid.

Subsequently, Sun Electric applied to strike out certain parts of Sunseap’s defence and counterclaim, on the ground that the Patent’s validity could not be challenged by way of counterclaim in infringement actions. This failed before an Assistant Registrar, and upon Sun Electric’s appeal to the High Court, in September 2017, Justice George Wei struck out the counterclaim for revocation of the patent, as he was of the view that the High Court does not have original jurisdiction to revoke patents or to hear revocation proceedings.

Sunseap then appealed further to the Court of Appeal – comprising Judges of Appeal Andrew Phang, Judith Prakash, Tay Yong Kwang and Steven Chong, as well as Justice Belinda Ang – which reserved judgment in August last year.

In the written judgment penned by Justice Tay, the Court of Appeal agreed with Sunseap’s legal team from Rajah & Tann, led by Mr Lau Kok Keng, that the High Court has the power to revoke a patent upon a finding of invalidity, when the revocation application was brought by way of defence and counterclaim in infringement proceedings.

However, such a power can only be exercised when every aspect of a patent has been found to be invalid. In cases where some, but not all, aspects of the patent have been found to be invalid, it would not be appropriate for the High Court to revoke the patent.

As the court puts it, this was consistent with Parliament’s intention – when the Patents Act (Cap 221, 2005 Rev Ed) was enacted in 1994 to divert the caseload of patent revocation applications from the High Court to the Registrar of Patents – which is to save costs in litigation. Whenever there are already patent infringement proceedings in the High Court, it makes sense for revocation applications in respect of the same patent to be heard in the High Court at the same time so as to save costs as well.

However, the court held that the High Court did not have original jurisdiction to hear standalone applications for revocation of patents, when no allegation of patent infringement exists. In such cases, the application must be brought before the Registrar of Patents at first instance.