On October 13, 2025, the Delhi High Court concluded a 21-year long patent dispute to give its first standard essential patent (SEP) non-infringement decision. In this judgment, the Court has ruled on patent infringement, discussed the impleadment of third-parties, identification of type of patent, requisites for claim mapping, effective use of evidence, and presentation of SEP essentiality. Interestingly the essentiality of the SEP was not framed as an issue in the suit, but the Court considered it on ‘vehement submissions’ of Philips and ultimately delivered the decision in favour of the defendants – M Bathla and others. In a broader context, the extreme delay in adjudication cannot be ignored; especially at a time when decisions involving SEPs are of high interest globally. The latency in judicial decision-making has given this judgement a character of an odd mix of expectations from the FRAND commitment existing prior to and after the evolution of some Indian SEP jurisprudence, overall this does not present a very clear picture. News (here and here) hints that video CDs might be making a comeback. The technology that was in consideration before the Delhi High Court, however, is long forgotten. With this judgement, the VCD patent can finally rest in peace.
Facts
Video Compact Discs (VCDs) were a type of compact discs widely used in Asia in the 1990s for storing and home-viewing of movies. A high demand for copies of films made these discs susceptible to bootlegging. Philips was part of a patent pool and had the rights to license the technology that made improvements to the audio compression and expansion of digital content stored in VCDs using the MPEG-1 standard. Philips had alleged that the defendants, BCI Optical Disc Limited and its director M. Bathla, infringed the Indian Patent No. 175971 titled ‘Digital Transmission System’ which contained said information on audio signal coding. They had done this in three steps: first, by sourcing/arranging for the manufacture of infringing stampers from which at least 25,000 CDs can be manufactured; second, by manufacturing/replicating VCDs based upon the said stampers which makes use of the patented technology, and selling them; and third, by wilfully ignoring the notice on replication equipment that directs the user to obtain separate licenses. Additionally, Philips claimed that the suit patent was related to the MPEG-1 and MPEG-2 audio compression systems standardized in ISO/IEC 11172-3: 1993 (E), and should be licensed as an SEP.
The defendants contended that the film producers who are the legal owners of the original master discs had control over the content of the VCDs from whom the defendants had license to replicate this content on consumer demand. The replication techniques relied on by Philips neither matched the claims of the suit patent, nor were there any parallels between Philips’ technology and the one employed by the defendants in their replication process. Further, Philips had not adequately proved that the suit patent was part of an SEP portfolio and no evidence of comparable licenses or SSO declarations was placed on record that could be used to determine FRAND rates. Finally, under the Indian evidence law, a discussion on technical standards in open communications and negotiations between the parties could not be used as evidence for admittance of essentiality of the suit patent.
The suit was instituted in 2004 to restrain manufacture, sale and offer for sale of VCD systems by the defendants. The patent was dated May 28, 1990 and expired on May 28, 2010 while this suit was pending. On July 17, 2023 the issues in suit were reconsidered and limited to infringement and damages.
Decision and Analysis
On the issue raised by defendants for impleading the film producers in their capacity of owners of the original master discs and Singulus, the company of whose technology the defendants used to make copies, the Court held in favour of Philips. The Court found that defendants did not adequately justify non-joinder of necessary parties. Thus, the questions of infringement of this suit patent would be decided in reference to the chain of events between Philips and the defendants.
The Court conducted a detailed analysis of the claims of the suit patent to determine its novelty in accordance with established jurisprudence on this matter. It found that Claim 1 of the suit patent which detailed the components of the invention, i.e. transmitter, receiver and transmission medium and the modified functioning of these components to solve issues noted in prior art was at the core of the invention. Additional reference was taken to the new Guidelines for Examination of Computer Related Inventions (CRI Guidelines), 2025 to conclude that the suit patent was to be identified as a ‘system patent’, or product patent. With this, the test for infringement of a system patent was conducted through mapping the defendant’s product to the claims of the suit patent. The Court found that Philips did not satisfy this ‘claim versus product’ mapping. What was required was to demonstrate that ‘each aspect of the defendant’s product’ i.e. entire system of the transmission, reception and the transmission medium, was covered by the patent claims, specifically Claim 1. Instead, what was provided by Philips was a similarity only between the product and the process relevant at the end result of the suit patent technology, i.e. achieving a same frame length in the copied audio frame.
This kind of claim mapping for a system or product patent, one that would demonstrate the presence of particular components in the defendant’s equipment, was also absent from Philips’ technical report. Philips’ technical expert also failed to examine the machine from Singulus which was, admittedly, used for the replication process. In the view of the Court, such an enquiry could have resulted in a more robust infringement analysis. Additionally, the court held that the defendants’ VCD replication did not make use of Philips’ audio compression and decompression technology. Audio coding would have happened at the time of making the master discs, which may have been the point of infringement. Since the defendants were not in business of manufacturing the master discs, it could not be adequately proved that they had ‘used’ the suit patent’s technology.
For a litigation based on the assertion of an SEP, the discussion on SEPs comes in only at the end of the judgment. Philips has claimed that the ISO/IEC 11172-3 standard was contained within the VCDs as a matter of fact and thus had to be licensed. It mentioned four specifications of the suit patent that were identical to certain parts of the standard. In this court’s opinion, this claim mapping was insufficient as it failed to show that claim limitations could be mapped to the mandatory portions of the standard recognised by the SSO. No comparative licenses, declaration to an SSO or essentiality certificate issued by an independent expert body were produced and the veracity of Philips’ expert evidence was questioned for its scientific correctness. The Court agreed with the defendants that record of good-faith negotiations could not be used as admission or evidence of SEP essentiality.
Judgement in Perspective
It is not clear why essentiality of the suit patent was not framed as an issue, when core arguments from both the sides pertained to the SEP status of the suit patent and private negotiations had ensued for four years on this matter. It also does not help that the Court only reluctantly agreed to deliberate on this issue, in the process avoiding any deliberation on the observance of the basic FRAND negotiation protocol informed from the CJEU Huawei ruling. A more complete analysis of the SEP issue in this suit would have helped clarify what is expected as an acceptable negotiation conduct & transparency in disclosure of information by the SEP-holder.
The utility of this decision lies in clarification of some rules of patent enforcement. First, the Court has reiterated that ‘system claims are product claims’, and the plaintiff is required to prove infringement of the totality of the constructed claims, not merely of any of the claims’ selected portions or elements. Second, claim charts, technical reports of independent experts proving essentiality, declarations to SSOs and comparable licenses to determine FRAND rates are necessary components to prove that a suit patent is an SEP. Third, despite whatever catching up the Court had to do with SEP jurisprudence in giving this judgment, the fact remains that this is the first judgement from an Indian court which is a definitive win for an Indian litigant with a finding of non-infringement of an SEP.
Finally, the very high interest in SEP decisions at the moment guarantees that the 21-year delay will receive attention. The Delhi HC has been sufficiently prompt in concluding more recent SEP litigations, one hopes that such delays are not repeated. The lengthy timeline of this suit also meant that new rules and regulations came into play during the suit’s pendency. What was ascertained through precedents is now codified in the High Court of Delhi Rules Governing Patent Suits, 2022. Future litigants must take reference of the requirements contained therein of claims mapping, and in the case of standard essential patents, claim charts. A passing reference was made to the CRI Guidelines, 2025, it would be interesting to see if more of such mentions come up in arguments in future cases.