Jurisdiction – India and USA
Position in India
Yes, there are two circumstances in which the Government can use a patent without permission by the Government –
- Merely of its own use under section 47; or
- For purposes of Government under section 100 read with section 99.
Merely of its Own Use – section 47
Section 47 contains the conditions that grant of a patent are subject to. Under this section, the Government may import, make and use any patented machine, apparatus or other article for the purpose of its own use. It can also use any patented process for its own use. “Merely of its own use” means use for the purposes of the Government by any department of the Government and would include use by servants or agents of the Government in performance of their duties.
Patents can also be used by any person for experiment or research which includes giving instructions to pupils [section 100(3)].
Additionally, under section 47(4) a patented medicine or drug can be imported by the Government for the purpose of its own use or for distribution in a dispensary, hospital or medical institution run by or on behalf of the Central Government. Such use, making or importation would not amount to infringement.
The provision is silent about the level of the Government and can include either the state Government or Central Government.
The section does not require payment of royalty to the patentee as the use by the Government is under the doctrine of eminent domain which gives the Government the right to expropriate private property for a public purpose. The same was recognized by the Bombay High Court in Garware Wall Ropes v. AI Chopra and Konkan Railway. The court stated – “No patentee can claim a right on a high pedestal than the Government performing sovereign function.”
Section 100 allows the Central Government to use inventions “for purposes of Government.” The patent can also be used by any person who has been authorized to do so in writing by the Central Government.
Section 99 explains the meaning of the phrase “for the purposes of Government.” Sub-section (1) states that an invention is said to be for the purposes of Government if it is –
- Exercised; or
For the purposes of the Central Government, State Government or a Government undertaking.
In Garware Wall Ropes the Bombay High Court held that third party agencies can use a patented invention for the purposes of Government. The Government must expressly authorize such third parties in writing to use the patent [section 100(1)]. The authorization can be given before or after the patent has been granted and also before or after the acts that have been authorized are done [section 100(4)].
The terms of the contract for use under this section must be agreed to by the Central Government/person authorized and the patentee. The patentee will be paid adequate remuneration taking into account the economic value of the patent. This is different from use under section 47 for which no remuneration needs to be paid to the patentee.
Different Opinions by High Courts
In Garware Walls Ropes it was contended by the respondent that making and using of the patented product was done for the work of Railway, which was a department of the Central Government. Hence the patent was subjected to for the Government’s own use under section 47 and no royalty had to be paid for the patentee.
The Bombay High Court held that use by the Konkan Railway did not constitute use for its own purposes as under s. 47. As per the court use under section 47 “would not include use by any other person like contractor of railways and the meaning is strictly restricted to the direct use by any department of the Government or its servants in the performance/in the discharge of their duties.”
Therefore, as per S. 100(1), Konkan Railway had to provide written authorization to the third party agency in order to use the patented invention. Also, under Section 100(3) adequate remuneration had to be given to the patentee as per the contract.
A differing opinion was expressed in Chemtura Corporation v. UOI wherein a similar issue arose and the Delhi High Court held that use by the Ministry of Railways would fall under section 47.
Position in the USA
As per 28 USC § 1498, if a patented invention is used or manufactured by or for the United States without obtaining a license from the patentee, the patentee has the right to institute an action against the United States in the US Court of Federal Claims. Hence the Government cannot use a patented invention without the patentee’s permission. The only remedy available to the patentee is recovery of reasonable and entire compensation for the use or manufacture.
If the use is made by any contractor for the Government, the contractor is immune from liability. The only action lies “against the US.” As was explained in Astornet Technologies v. BAE Systems – “As indicated by the statute’s use of the definite article in providing “the owner’s remedy” and its statement that the remedy is for payment of the owner’s “entire compensation,” the statute, within its ambit, makes the remedy against the United States exclusive.”
Featured image from here.