Playback: Lessons from Philips v Bansal

Eight years on, India’s first standard-essential patent decree has redefined the country’s evidentiary bar for enforcement, explains Pankaj Soni of Remfry & Sagar.

On July 12, 2018, the Delhi High Court delivered India’s first post-trial judgment in a standard-essential patent (SEP) dispute, decreeing royalties, interest and punitive damages in favour of Koninklijke Philips Electronics against local assemblers of DVD video players.

On May 18, 2026, a Division Bench of the same court allowed the assemblers’ appeals, and set the decree aside in its entirety (KK Bansal v Koninklijke Philips Electronics (2026)).

Other than being the first reversal of the first SEP decree, the decision is important for setting a specific standard in what makes (or breaks) an SEP case.

The road to the appeal

Philips had sued in 2009, asserting Indian Patent No. 184753, a “decoding device” compliant with the DVD Forum standard, against Rajesh Bansal (Mangalam Technology) and KK Bansal (Bhagirathi Electronics), who assembled DVD players using imported MediaTek chips.

The Single Judge found the patent to be a valid, essential and infringed SEP and, since the patent had expired on February 12, 2015, decreed royalties, interest, and punitive damages against Rajesh Bansal.

Before turning to the four issues that were framed on appeal ie, whether the patent was an SEP, whether Philips was barred by exhaustion, whether the patent had been infringed, and whether the damages were sustainable, the Division Bench set out the sequence an SEP holder must follow after it initiates a suit for infringement.

First, the patentee must establish that its patent is an SEP. Second, it must show that the defendant’s product infringes the patent. Third, the patentee must show that it acted as a willing licensor offering FRAND terms. Only once these three steps are cleared does the implementer’s alleged unwillingness to take a licence become relevant. The Bench found that Philips had not crossed the first hurdle.

No proof that patent was an SEP

To establish essentiality, Philips had relied on “essentiality certificates” prepared for the corresponding US and European patents by law firms in those jurisdictions. The Bench treated these as no more than private expert opinions because no author of either certificate entered the witness box and, therefore, was not cross examined. Further, no claim charts were placed on record mapping the claims of the suit patent, or of the US and European patents, onto the DVD standard.

It was not in dispute that the DVD Forum is a standard-setting body, but that did not relieve Philips of its burden in proving that the suit patent was essential to its standard.

To compound the issue, the Bench zeroed in on a mismatch at the heart of the essentiality case. The suit patent is directed to a product, whereas the corresponding US and European patents on which the certificates were prepared are method patents.

The attempt by Philips to carry essentiality across from one to the other did not find favour with the court. Turning to the patent itself, the Bench observed that although every claim was for a “device”, the complete specification opened by describing a “method”, a description the court found to be at odds with both the claims and the title of the patent.

Reiterating that protection extends only to what is claimed, the Bench held that the claimed device resided in the chip, or the printed circuit board, of a player, and that anything outside the PCB lay outside the patent—a point that worked against Philips in the damages calculations.

No proof of infringement

Having found the essentiality case wanting, the Bench turned to infringement and found it equally unproven. Philips had not mapped the suit patent onto the standard, and its indirect case rested on the same essentiality certificates the court had already rejected. The direct case fared no better.

Where the Single Judge had been content to accept the plaintiff’s expert analysis, the Division Bench insisted on the accepted method of proving infringement, ie, a mapping of the claims onto the defendant’s product, and found that this exercise had not been done. The infringement affidavit of Philips’ witness had reduced credibility because he never entered the witness box; and the independent testing spoken to by Philips’ other witness was unsupported by any test logs. Thus, the Division Bench drew an adverse inference under Section 114 of the Evidence Act.

The court also noted that testing had been carried out on the entire DVD player rather than on the chip or PCB which, in the Bench’s construction, is where the invention resided. The Bench therefore concluded that there is “no evidence of infringement, either direct or indirect”.

Exhaustion defence and damages

The Bansals’ exhaustion defence turned on their supply chain, which the Bench found had gone unrebutted. The Bansals had bought MediaTek chips from Shuntak and Sheen Land (in China). These entities were registered vendors of MediaTek, and MediaTek was, in turn, a registered vendor of Philips. Interestingly, the witness who spoke to this supply chain was not cross-examined, which weighed heavily in favour of the Bench accepting the accuracy of the supply chain.

Particularly, the Bench observed that following the amendment of Section 107A(b), the provision no longer requires a seller to be “duly authorised by the patentee”; it is enough that the seller be “duly authorised under the law”. Therefore, once Philips had released the patented chip into the market, its rights in respect of that chip were exhausted. The point was reinforced by Philips’ own evidence that the same MediaTek MT1389-family chip was found not only in the Bansals’ players but in the products of Philips itself and other sellers.

On damages, the Bench held that Philips had placed no comparable licence on record, even though its witness had admitted to holding such agreements, again attracting an adverse inference under Section 114. Rates exchanged in pre-suit or informal negotiations, the Bench held, can never fix a final FRAND royalty and, at most, they might support an interim pro tem arrangement.

It further held that royalty could not be assessed on the net selling price of the entire player, which would compensate Philips for components it had never patented, and that Philips’s practice of offering royalties “per player” was a commercial choice that could not dictate the royalty payable in litigation. With no sustainable finding of infringement or of a FRAND breach, the punitive award was no longer sustainable.

What it means

Read together, the Bench’s findings recalibrate the evidentiary bar for SEP enforcement in India. A patentee must (i) prove essentiality with claim charts and with witnesses who can be cross-examined; (ii) prove infringement by mapping the claims onto the accused product or the product to the standard (while establishing that its patent reads on the standard); and (iii) prove its own FRAND conduct with comparable licences rather than negotiation correspondence.

The exhaustion holding is a particular caution for patentees who both license a component without field of use restrictions, and sell it themselves. The harder FRAND questions, meanwhile, remained unanswered, because on its findings there was no properly proved SEP or infringement to price. Notably, the Bench remarked that arriving at a legally correct FRAND rate in India is, in its words, “frankly, impossible”, which underscores the fact that even courts may not have a settled royalty-setting methodology.

In the wider arc of India’s growing body of post-trial jurisprudence, the present case reads less as a retreat from SEP protection than as an insistence that it be earned on evidence. How the decision cements the standard of proof set for the SEP cases remains to be seen, as by last count, the appeal to the Supreme Court of India has been admitted, and the fight continues.

Takeaways
•  Court overturned SEP decree
•  Philips failed to prove infringement
•  SEP enforcement bar is redefined

Pankaj Soni is a partner and patent chair at Remfry & Sagar. He can be contacted at pankaj.soni@remfry.com