Law Ministry: Thousands of patents and trademark orders granted in the last two years are "legally unenforceable"

In a significant development, the Controller General of Patents, Designs and Trade Marks (CGPDTM) has come under scrutiny after thousands of patent and trademark orders issued in the past two years were declared "legally unenforceable" by the Union Law Ministry and an Additional Solicitor General (ASG) of India. The orders were reportedly made by "outsourced employees," raising concerns about their legality under the Trade Marks Act.

According to The Indian Express, the controversy emerged when the patent organization contracted hundreds of workers through the Quality Council of India (QCI), an independent entity not affiliated with the Indian government. These employees, who were not officially appointed by the Central Government, issued quasi-judicial decisions in 2023, granting patents and trademarks to various corporations.

The Department of Legal Affairs, in a legal opinion dated April 25, asserted that decisions taken by "outsourced employees appointed through any agency (and not by the Central Government) in any statutory proceeding can very well be challenged as null and void as these orders are passed by legally incompetent persons." This legal stance was sought by the Department for Promotion of Industry and Internal Trade (DPIIT), which requested clarification on the matter earlier in the same month.

ASG Aishwarya Bhati further reinforced this opinion on June 17, stating that the decisions made by these "unauthorized outsourced employees" should be "annulled." The CGPDTM had previously outsourced 790 personnel to QCI at an annual cost of Rs 50.26 crore, starting October 10, 2022. The hiring was in response to a report from the Economic Advisory Council to the Prime Minister (EAC-PM), which highlighted that a shortage of personnel was causing delays in the approval of patents and trademarks.

Despite these staffing efforts, the Ministry of Commerce and Industry reported that the CGPDTM issued up to one lakh patents between March 2023 and March 2024. These patents were granted to global IT giants such as Qualcomm Inc., Samsung Electronics, Huawei Technologies, and Apple. Data from the World Intellectual Property Organization (WIPO) also revealed that in 2022, 74.46% of the patents approved by India were for non-resident Indians and foreign entities.

The revelations have sparked concerns over the validity of these intellectual property rights, and the legal implications for businesses that received patents and trademarks through this process remain to be seen. The matter is likely to have far-reaching consequences for India's intellectual property regime, potentially affecting its global standing and relationships with multinational corporations.