UNILIN BEHEER B.V. vs BALAJI ACTION BUILDWELL
$~11
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 4th November, 2024
+ CS(COMM) 1683/2016 with CC(COMM) 38/2018 and I.A.13689/2017 and 7308/2024
UNILIN BEHEER B.V. …..Plaintiff
Through: Ms. Swathi Sukumar, Mr. Essenese Obhan, Ms. Ayesha Guhathakurta, Mr. Naveen Nagarjuna, Mr. Ritik Raghuwanshi, Mr. Rishubh Agarwal and Ms. Urvashi Singh, Advocates
versus
BALAJI ACTION BUILDWELL …..Defendant
Through: Mr. Chander M. Lall, Senior Advocate with Mr. Sanuj Das, Advocate
CORAM:
HON’BLE MR. JUSTICE AMIT BANSAL
AMIT BANSAL, J. (Oral)
I.A. 13688/2017
1. The present application has been filed on behalf of the plaintiff seeking the following reliefs:-
(i) Allow the confidential documents of the Plaintiff to be filed a seal cover;
(ii) Set up a confidentiality club with respect to the documents being filed in a sealed cover as per the guidelines/procure laid down in paragraph 4 above
2. Notice was issued in this application vide order dated 21st November, 2017.
3. Reply has been filed on behalf of the defendant on 21st December, 2017 opposing the present application.
PREFATORY FACTS
4. The present suit has been filed seeking relief of permanent injunction restraining the defendant from infringing the registered patent of the plaintiff along with other ancillary reliefs.
5. The Plaintiff, Unilin Beheer B.V., is a company organized under the laws of Netherlands, which is a part of Mohawk Industries Inc., which is a Fortune 500 company and the world’s largest flooring company with operations in Australia, Brazil, Canada, China, Europe, India, Malaysia, Mexico, Russia and the US.
6. The plaintiff is the proprietor of the Indian patent no.193247 granted on 28th January, 2005 which is the subject matter of the present suit (hereinafter referred to as Suit Patent).
7. The Defendant, Balaji Action Buildwell, is a partnership firm, involved in the field of manufacturing particle boards and fibre boards for use in flooring under the brand name Action TESA®, which allegedly infringes the plaintiffs Suit Patent.
8. The present suit was filed on 13th December, 2016. During the pendency of the suit, the term of the suit patent expired in April 2017.
9. The written statement was filed on behalf of the defendant on 6th February, 2017 and replication thereto was filed on 3rd April, 2017.
10. The present application was filed on behalf of the plaintiff on 20th November, 2017 seeking to place on record the confidential documents which are in the nature of third-party license agreements entered into by the plaintiff.
11. It is unfortunate that the aforesaid application has remained pending till date, because of which the trial in the suit could not begin.
SUBMISSIONS
12. Ms. Swathi Sukumar, counsel appearing on behalf of the plaintiff submits that the relevant pleadings regarding the confidential third-party license agreements that are the subject matter of the present application have been made in paragraph 22 of the plaint.
13. Ms. Sukumar relies on the judgment of the Division Bench of this Court in Agva Healthcare Private limited and Ors. v. Agfa-Gevaert NV and Anr. 2023 SCC Online Del 7914 to submit that additional documents should be taken on record where sufficient cause has been shown on behalf of the plaintiff. She further submits that in terms of Order XI Rule 1(5), no separate application is required to be filed on behalf of the plaintiff in order to show sufficient cause.
14. She also places reliance on the judgment in Telefonktiebolaget LM Ericsson (PUBL) v. Lava International Ltd. 2016 SCC OnLine Del 1354 in support of her contention that the aforesaid additional documents could not be filed by the plaintiff earlier as a confidentiality club was required to be constituted taking into account the confidential nature of the documents.
15. Mr. Chander M. Lall, senior counsel on behalf of the defendant submits that all the aforesaid documents now sought to be filed were always in power and possession of the plaintiff and therefore, there is no reason why they were not filed along with the plaint. He further contends that the plaintiff has not set up any plea of confidentiality in respect of these documents in the plaint. The plaintiff has filed these documents without there being any application for taking the same on record.
16. He places reliance on the judgment of the Co-ordinate Bench in TTK Prestige Limited v. Baghla Sanitaryware Private Limited and Ors. 2024 SCC OnLine Del 882 to submit that in view of the amendments to the Code of Civil Procedure, 1908 in respect of commercial suits, the Court should take a strict view with regard to permitting additional documents being taken on record.
ANALYSIS AND FINDINGS
17. I have heard the counsel for the parties.
18. A reading of the plaint would show that the plaintiff had specifically made averments with regard to the plaintiffs licensing program for its technology in respect of the Suit Patent in India by way of granting licenses/sub-licenses. The present application was filed by the plaintiff in November, 2017, wherein it is specifically stated that the plaintiff seeks to place reliance on third-party license agreements which contained highly confidential commercial terms and therefore, sought the constitution of a confidentiality club to place the same on record.
19. In my considered view, the apprehension of the plaintiff that the aforesaid documents could not be filed till the time a confidentiality club was constituted, is genuine. It cannot be disputed that third-party licensing agreements contain commercially sensitive information and such documents are highly confidential in nature.
20. A perusal of Order XI Rule 1(5) would show that it is for the Court to grant leave to take additional documents on record if the Court is satisfied that a reasonable cause has been shown on behalf of the plaintiff. In the present application, the plaintiff has specifically stated that the plaintiff seeks leave to file its license agreements, which are confidential in nature, in a sealed cover and hence, seeks the formation of a confidentiality club.
21. In these circumstances, in my view, the plaintiff has established a reasonable cause for not filing these documents at an earlier stage. Therefore, there was no need for the plaintiff to file a separate application under Order XI Rule 1(5).
22. In this regard, reference may be made to the observations of the Division Bench in Agva Healthcare Private limited and Ors. (Supra)
16. At the stage of granting leave to place on record additional documents, the Court is not required to consider the genuineness of the documents/additional documents, the stage at which the genuineness of the documents is to be considered is during the trial.
17. We may also note that the present application had been filed when the suit is still at an initial stage and the issues are yet to be framed. The plea of the appellants that along with the plaint, the plaintiffs had filed appropriate declaration that all documents in power, possession, control or custody of the plaintiffs has been disclosed etc. is misplaced. By placing on record the documents, the respondents are neither setting up a new case nor withdrawing any admission. By virtue of the additional documents, plaintiffs are not setting up a case contrary to what has been pleaded in the plaint.
[Emphasis is ours]
23. Counsel for the plaintiff has correctly placed reliance on the judgment of the Co-ordinate Bench in Telefonktiebolaget LM Ericsson (Supra), In the said case also, the documents sought to be placed on record by the plaintiff were third-party license agreements. The plaintiff therein filed a similar application seeking the constitution of a confidentiality club in order to place on record the aforesaid third-party license agreements which were confidential in nature. Pertinently, the aforesaid application was filed after framing of the issues but before commencement of the trial. The Court allowed the said application holding that the aforesaid confidential documents could not have been filed without the constitution of a confidentiality club. Accordingly, the court ordered the constitution of a confidentiality club and permitted the plaintiff to file confidential documents in a sealed cover.
24. Mr. Lall submits that the aforesaid directions were passed in the suit at a point of time when the suit was an ordinary suit and not a commercial suit. In my considered view, the rationale and reasoning adopted in the present judgment would squarely be applicable in the present case.
25. In the present case also, the suit is at an initial stage and the issues are yet to be framed in the suit. The documents sought to be filed on behalf of the plaintiff are confidential in nature and could not have been filed till the time a confidentiality club was established. Further, in my view, these documents are necessary to determine the damages claimed by the plaintiff in the present suit.
26. In light of the aforesaid, the confidential documents filed by the plaintiff vide Index dated 25th November, 2020 in a sealed cover are taken on record.
27. The said documents shall be kept in safe custody by the Registry.
28. Accordingly, this court directs the constitution of a confidentiality club.
29. In this regard, the following directions are passed:
I. Within two weeks, each party is directed to provide on an affidavit, a list of not more than four lawyers (who are not and have not been in-house lawyers of one of the parties) and one technical expert witness, who alone will be entitled to see the aforesaid confidential documents/patent license agreements.
II. It is made clear that the said members shall be bound by the applicable obligations prescribed in Annexure F Chapter VII Rule 17 of the Delhi High Court (Original Side) Rules, 2018.
30. The application stands disposed of.
CS(COMM) 1683/2016 with CC(COMM) 38/2018 and I.A.13689/2017 and 7308/2024
31. List on 4th December, 2024.
AMIT BANSAL, J
NOVEMBER 4th, 2024
kd
CS(COMM) 1683/2016 Page 7 of 7