Can a suit for groundless threat be transferred to High Court under Designs Act?

As an IP lawyer I have come across an issue pertaining to transfer of a suit of groundless thereat under section 23 of the Designs Act, 2000 from District Court to High Court which stimulates me to write this blog. The question is whether a suit for groundless threat under Designs Act, 2000 can be transferred from District Court to High Court if the defendant institutes a counterclaim wherein he asks for infringement of his registered Design and challenges the validity of the design of the plaintiff.. This is the only issue in this article. Let me discuss it in detail. 

Let me travel from various provisions of Intellectual property laws with regard to groundless threat to reach the destination. In Trade marks Act, 1999 there is provision of groundless threat of legal proceedings under section 142 of the Act, however, there is no such provision of transferring  suit from District Court to High Court as are in Designs Act and Patent Act. In Copyright Act,1957 section 60 provides information about the remedy in the case of groundless threat of legal proceedings. In The Geographical Indications of Goods (Registration and Protection) Act,1999, the issue of groundless threat is involved under section 73 of the Act. In these three Acts, the suit of groundless threat becomes infructuous  if a suit for infringement action is filed against the person who has filed a suit for groundless threat. The legal scenario in respect of the provisions of groundless threat is different in the Designs Act and Patent Act than that of the above mentioned three Acts. Let t it be discussed as under.

Before I discuss about the provisions  related to groundless threats,  is is essential to talk about the legal positions of the suit related to infringement of design and patent under Designs Act and Patent Act respectively. Section 22 of the Designs Act says that the registered proprietor of the Design is entitled to take a legal action against a person who is infringing the registered design for the purpose of sale by making any fraudulent or obvious imitation of the said registered design without taking any licence or written consent of the registered proprietor by instituting  a suit for damage and injunction against the person  in the District Court. In such a suit, if the defendant takes the defence that the registration of a design may be cancelled under section 19, the suit or other such other proceeding shall be transferred by the District Court to the High Court for decision. In the Patent Act,1970 according to the proviso  of section 104 where a counter-claim for revocation of the patent is made by the defendant, the suit, along with the counter-claim, shall be transferred to the High Court for decision.

Now coming back to the main point, Section 23 of Designs Act, 2000 speaks about the groundless thereat wherein it is provided that the corresponding provisions of the Patent Act will apply in a case of groundless thereat of the registered design.. It means that section 106 (power of court to grant relief in cases of groundless threats of infringement proceedings)  of the Patent Act 1970 would apply as it is in the case of groundless threat of Design. Thus it is obvious picture that section 106 of the Patent Act in the case of groundless threats of legal proceedings of registered designs would be applicable in like manner as they apply in the case of patents.

Now plain reading of section 106 of the Patent Act inspires me to read the provisions of section 104 of the Patent Act for the issue whether the suit of  groundless threat would be transferred to the High Court or not in a like manner as the suit of infringement of design or patent is transferred when the defence of section 19 of the Designs Act or a counter claim for revocation under section 64 of the patent Act  is taken as the case may be. The reason behind reading section 104 is that it is connected with S.106. First part of Section 104 is for jurisdiction. There are three points covered in section 104.

(1) suit for declaration as to non- infringement under section 105 .
(2) suit for relief in cases of groundless threats  under section 106
(3) suit for infringement of patent

Here for this article only point no.2  is related as section 104 states that the suit for any relief under section 106 shall be instituted in District Court. Now the proviso of section 104 is very important which  states that if a counter-claim  for revocation of the patent is made by the defendant, the suit along with counter-claim shall be transferred to High Court for decision. Here the legislature is of the view that counter claim for revocation of the patent, shall be made against either of a suit of the above mentioned three points and not for any specific point otherwise that specific point would have been mentioned in the provision. For example, if counterclaim had been made only for infringement of patent, it would have been specifically mentioned in the section and therefore, the issue of applicability of counterclaim in proviso of Section 104 of the Patent Act  is with  either of the three points mentioned herein above.

(It is hereby specified that that the provisions of counter claim are mentioned in Order 8 Rule 6-A of Code of Civil Procedure, 1908)

Suppose a defendant of the case of groundless threat under S.106, institutes a counter-claim for revocation of the patent of the plaintiff, then the suit along with the counter-claim is transferred to the High Court for decision. Moreover, as per the provisions of the sub-section 2 of  Section 106, the defendant of the suit for groundless threat has to prove that the plaintiff of that suit is infringing the patent.  On the other hand,  to establish the case of groundless threat, the onus is on the plaintiff  to show that the patent of the defendant,  is not valid to establish the case of groundless threat. Under such circumstances, can a defendant of the suit for groundless threat of patent institute a counterclaim of infringing the patent? , the answer is 'YES' as per the provisions of section 104 read with section 106 of the Patent Act, 1970. It is stated that the suit for groundless threat is transferred to High Court from District Court in view of the counter claim being made by the defendant for infringement of patent.

Coming back to the main issue of the counterclaim in suit for groundless threat under section 23 of the  Designs Act 2000, it is said that the provisions of the Patent Act, 1970 are applied in respect of following points.

(1) certificates of the validity of a patent
(2) the remedy in case of groundless threats of legal proceedings by a patentee

Thus, for application of section 23 of the Designs Act in like manner of the provisions of the Patent Act , it is required to be considered in the manner mentioned as under.

(1) certificates of the registered design
(2) the remedy in the case of groundless threats of legal proceedings
(3) a proprietor of a design is in place of patentee
(4) a registered design is in place of patent
(5) a design is in place of invention

Considering the above mentioned legal scenario in respect of a transfer of a suit for groundless threat under Designs Act, 2000,  I conclude with my opinion that  the above mentioned rule is applied to the suit for groundless threat of Design under Designs Act, 2000  in view of the provisions of section 106 read with section 104 of the Patent Act, 1970 which is related to section 23 of the Designs Act, 2000. Section 23 of the Designs Act,2000 is relied upon section 106 of the Patent Act 1970. If a counterclaim is instituted against the suit for  the groundless threat of patent , the suit along with counterclaim is transferred to High Court for decision as per section 104 of the Patent Act, then likewise, if a counterclaim is instituted against the suit for the groundless threat of Design, the said suit along with counterclaim is transferred to High Court as section 23 of the Designs Act is based on section 106 of the Patent Act and the heart of section 106 for transferring suit is section 104 of the Patent Act and therefore, in my opinion, the suit for groundless threat for Design under section 23 of the Designs Act is required to be transferred from District Court to High Court provided that the counter claim of infringement of registered Design is instituted against that suit for groundless threat.