Patent War on Twin Spark Technology

Since 2007, the patent war in the arena of technology had dragged the auto giants like TVS and Bajaj in the court of law. When TVS was dragged in the court for unauthorized use of the technology called Digital Twin Spark Plug ignition (DTSi) in its bike Flame.

What is DTS-i?

DTS-i technology is based on two Spark plugs. It delivers better fuel efficiency and lower emissions.

DTS-i Engine was later tuned to deliver exhilarating performance as in DTS-FI or exceptional mileage like in DTS-SI as claimed by Bajaj. 

The Patent Controversy.

The case involves the issues of patent infringement by the defendant and the damages for the same. But the case, further, touches upon the controversy regarding justification of the threats issued by the defendant of the same case. The case was filed before the Madras High Court in 2007.

The plaintiffs in (Bajaj Auto Ltd), along with the state of Maharashtra alleged the defendants (T.V.S. Motor Company Ltd.) of infringement of the patents of the plaintiffs, which concerns the invention of the technology of improved internal combustion engine. The remedy sought by the plaintiffs is that of permanent injunction for prohibiting the defendants from

1. using the technology or invention described in the patents of the plaintiffs; and
2. preventing them from marketing, selling offering for sale or exporting 2/3 wheelers (including the proposed 125cc TVS FLAME motorcycle) that contain the disputed internal combustion engine or product that infringe the patent. They also claim damages for infringement of the patent.

Background of the Case.  

Bajaj’s patent. Bajaj Auto Limited (the appellant) claimed that it was granted patent titled “An Improved Internal combustion engine working on four stroke principle” with a priority date of 16th July 2002. The patent was granted on 7^th July, 2005. 

Features of the invention are:

• Small displacement engine as reflected by a cylinder bore diameter between 45 mm and 70 mm.
• Combustion of lean air fuel mixtures;
• Using a pair of spark plugs to ignite the air fuel mixture at a predetermined instant.  

What was the Patent all about? The subject-matter of the patent, the invention by the applicants called DTS-i Technology was relating to the use of twin spark plugs for efficient combustion of lean air fuel mixture in small bore ranging from 45 mm to 70 mm internal combustion engine working on 4 stroke principle.

   

Tests of Patentability. According to the applicants, their invention was patentable because it qualified the tests of novelty, non-obviousness and industrial application. Following were the grounds on which the applicants corroborated their claim:

1. The use of two spark plugs in large bore engines or in high performance or racing bikes was known in the Automobile industry. But the invention of the appellant was not known in the industry.
2. The applicants claim that the need to have more than one spark plug was never thought necessary in small bore non-racing engines. Even if it was felt so, no advantages of a dual spark plug were observed. The invention of the applicant was on the application of twin plugs in small bore engine with positive merits of improved fuel efficiency and emission characteristics. In case of the small-bore engines using twin spark plugs, those engines were not lean burn.
3. In the first eight months of the that financial year, “DTS-i Technology” accounted to 54.25% share of Bajaj two wheelers. Applicants claimed that they spent considerable amount in marketing and advertising and received appreciation through out the world as recipients of various world awards and the product is of economic advantage of the country. 

TVS launches FLAME- the Bone of Contention. The Respondents, (M/s. TVS Motor Company Limited) announced to launch motor bikes of 125-CC on 14^th December 2007 under the trade mark 'FLAME'. The motorcycle was powered with a lean burn internal combustion engine having a twin spark plug configuration, which according to the Bajaj Auto Ltd., infringes its patent.

 

Therefore, before the launch of motor bikes, the applicants brought the suit before the court to protect their patent.

TVS files suit under section 105 and 106 of the Patents Act, 1970. In October, 2007, the respondent filed the suit before the Madras High Court, alleging that the statement made by the applicant constituted a groundless threat.

They learnt that the respondent has also filed a suit for defamation against the applicant in the Bombay High Court. 

Application for revocation of the applicant’s patent. The applicant also came to know that only 7 days before the launch of the proposed 125-CC motorcycle, the respondent filed an application for revocation of applicant's patent before Indian Patents Appellate Board (“IPAB”). 

Launch of the disputed bike. The respondents, later in the month of December of 2007, launched the bikes without making any change into that.

Contentions of the Parties.

Pleadings by the appellants. Following were the pleadings made by the applicants in their affidavit:

1. The patent granted to the applicant is valid and subsisting; 
2. The respondents can not save its skin by claiming that it is using 3 valves in the engine since the number of valves is not an essential feature of the applicant's invention; 
3. The specifications of the respondent’s TVS Flame have the similarities with the patenting technology of the applicant; 
4. Grant of injunction is essential to protect the statutory right of monopoly conferred on the applicant by virtue of the patent. Otherwise, its use by the respondent would severely prejudice the statutory right apart from damaging the reputation and goodwill, which cannot be compensated in pecuniary terms; 
5. The damage caused by the infringing act, will have telling effect on the market share loss, relative position in the industry, impact on competitiveness, impact on industry rankings etc. of the applicant, which cannot be measured in terms of money; and 
6. The applicants have launched its motorbike with effect from the year 2003 and steadily increased the sale in these long four years, whereas the respondents have launched “FLAME” only on 14.12.2007 and they have not sold the said motorbike on an extensive scale and therefore.

Pleadings by the respondents.  

To sum up the arguments forwarded by the respondents, following were the grounds used by the respondents to challenge the patent of the applicants:  

1. The concept of two spark plugs being prior art: The respondent places reliance on various published papers to substantiate its claim. They also plead that the use of twin spark plugs in lean burn engines is known as US Patent No. 5320075 titled “Internal Combustion Engine with Dual Ignition for a lean burn”.
2. Use of two spark plugs in engines with narrow bore size of 45mm-70mm being prior art: The respondent has also referred to Takegawa Cylinder heads and Honda Bros, NC 25E. Kawasaki KZ 1000 SI and Kawasaki KZ 1000 SI have the configuration of two valves per cylinder with twin plugs, cylinder bore size is 69.4mm. Honda NT 400, as per the specification stated in the advertisement, contains 2 cylinders with each cylinder has a bore size of 64mm with 2 spark plugs per cylinder. 
3. The third valve arrangement of the respondent is protected by patent licensed to it by AVL List GMBH: According to the respondent, the spark plugs in the engine in its vehicle “FLAME” are arranged in a different way in comparison to what is claimed by the applicant's patent. 

Judgment Delivered by the Court.

The learned single judge, after considering the submissions of both parties and considering various facets of the case came to the conclusion.

The court relied upon the principles in granting interlocutory injunction including any patent action. The principles are:

1. The plaintiff must prove prima facie case that the patent is valid and infringed;
2. Balance of convenience is in favour of plaintiff; and
3. Irreparable loss that may be caused to the plaintiff by not granting an order of injunction.

After considering the pleadings and various facets of the case, the learned single judge held that the concepts of prima facie case, balance of convenience and inadequacy of damages was in favour of the applicant. The grant of injunction was in favour of the applicant. Thus, the interim injunction was granted in favour of the applicant.

Appeal and Judgment.

The interim order was challenged before the Division Bench of the Madras HighCourt, where the appeal was allowed.

The appeal finally went before the honourable Supreme Court (Markandey Katju and Ashok Kumar Ganguly JJ.), through the Special Leave Petition. In the matter before it, the Supreme Court criticized the pendency of the matters relating to the intellectual properties, even at interlocutory stage. The suit for the permanent injunction was also pending before the court.

Quashing the order granting the interim injunction to applicants, the Court held the Respondents entitled to sell its product in the market, but maintaining an accurate record of all India and export sales. The Court appointed a receiver for the same.

The Court also directed the learned single judge to decide the suit of permanent injunction and directed the Respondents to file written statement in the suit.

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