Delhi High Court Restrains Canva: Minor Differences Between Patented Invention & Infringed Product Does Not Permit Infringer to Escape Infringement

Delhi High Court Restrains Canva: Minor Differences Between Patented Invention & Infringed Product Does Not Permit Infringer to Escape Infringement

The Delhi High Court has issued a restraining order against Canva, an Australian multinational graphic design platform, prohibiting the availability of its ‘Present and Record’ feature in India.

The single judge Justice Pratibha M. Singh passed this direction to a patent infringement suit filed by RxPrism Health Systems Private Limited (Plaintiff). The Judge directed Canva to deposit Rs. 50 lakhs with the Registrar General as security for RxPrism’s claims regarding the past use of the infringing feature in India. The Court calculated the penalty based on the revenue and sales figures of users who utilized the feature in the country before 30 June, 2022.

The Court passed the interim order in favor of RxPrism, observing that prima facie the case was in its favor and against Canva.

RxPrism, which offers AI-based customer engagement services to pharma companies, filed the suit seeking a permanent injunction restraining infringement of its patent ‘My Show & Tell’ which was launched in May 2020.

The case of the Plaintiff is that it developed a novel and innovative product which is a system and a method for ‘creating and sharing interactive content’. This system of sharing content is distinct from video advertisements. It filed an Indian patent application bearing number ‘201841048222’ on 19 December, 2018, which was published on 3 January, 2020.

Defendant No.1-Canva, a graphic designing platform launched in 2013, and offers comprehensive design solutions on the website, www.canva.com. Canva provides services such as blog graphics, presentations, flyers, posters, and invitations creation, catering to a global audience.

However, according to the Plaintiff, a new feature was incorporated on the Defendant’s platform called ‘Present and Record’. The Plaintiff’s case is that it came across this feature on the Defendant’s product sometime in June 2021, even though it was launched in August 2020. The Plaintiff learned of this feature through a YouTube video. The said digital product was accessible to any user with a computing device and operating system, coupled with hardware, such as, camera microphone etc.

According to the Plaintiff, the impugned ‘Present and Record’ feature in the Defendant’s Canva product provided an almost identical tool for creating product descriptions and other online content

The Plaintiff alleged that due to the incorporation of this feature, which was infringing in nature, the Defendant’s active users grew from 30 million in June 2020 to 55 million as on April 2021, with doubling of revenues. It relied on newspaper publications to highlight that the ‘Present and Record’ feature, especially during the COVID-19 pandemic, became a huge success.

The Court elucidated that in a patent infringement suit, the broad settled position is –

(a) That the claims have to be construed in a purposive manner. On the basis of the claims of the patent specification the Defendant’s product is to be compared for assessing infringement;

(b) In the process of comparison, trivial variations would not matter and the Court has to assess if the Defendant’s product is producing the same effect or is ‘equivalent’, to the invention claimed and disclosed in the Patent.

(c) The comparison between the Plaintiff’s product and the Defendant’s product can only lend support for the purposes of understanding of the technology and the features of the two products. However, the Product vs. Product comparison shall not be determinative of infringement. It is the Granted Claims vs. Product comparison that is determinative of patent infringement.

The Court asserted that the product is focused on the existence of two media i.e., the first, and the second media in the form of a PIP. The movement is not an essential feature of the Plaintiff’s product, but the fact that the first and second media is integrated in a manner as to sync the audio with the video and the image is essential, opined the Judge.

The judge held that the Defendant cannot escape infringement on the basis of the location of the Call-to-Action button.

“The action that can be taken by the consumer or viewer could be in any form, either for buying a product or for adding a comment or for sending a query. Depending upon the application and implementation, the said element can be added both in the Plaintiff’s and Defendant’s product. Thus, the mere non-existence of a sandwich layer would not obviate the infringement, inasmuch as by applying the doctrine of equivalence, the functionality of both the Plaintiff’s and the Defendant’s product is almost identical,” the Court observed.

While comparing the working of the Defendant’s ‘Present and Record’ feature with the claims, the Court stated that it demonstrated that almost all the same steps therein are present in the Defendant’s product, thus, prima facie, establishing infringement.

The Court found Canva’s written statements libelous and slanderous. Canva aimed to prevent the plaintiff from enforcing its patent rights. This included not only Canva but also other potential infringers. Canva’s use of phrases like ‘coerce, evasive, and unscrupulous’ violated principles governing permissible language in pleadings, expressed the Court.

Moreover, the Court expressed concern over Canva’s use of language in their written statement, where they made wild allegations against the plaintiff. The Court highlighted unnecessary expressions like ‘sham paper trail to tick the boxes’ in the context of a patent infringement action. The Court emphasized that written statements should adhere to the permissible language guidelines, as laid out in Order VIII of the Civil Procedure Code (CPC).

The Court also examined Canva’s conduct in initially claiming the disputed technology as their own and filing a PCT (Patent Cooperation Treaty) application, only to abandon it during the lawsuit. This behavior raised suspicions of Canva attempting to camouflage its stand and claim rights on similar technology. The Court emphasized that viewing such actions as prima facie evidence of questionable behavior is possible.

The Court concluded by stating that the trivial or minor differences between the patented invention and the Defendant’s product would not permit the Defendant to escape the infringement.

The Court while considering the fact that the Plaintiff had made out a case of infringement, especially by a mapping of claim charts, and that the Defendant had been unable to make a credible challenge to the Plaintiff’s patent, ruled that the balance of convenience also lied in favor of the Plaintiff.

The Court injuncted Canva and was accordingly, fined.