From the Court: Beijing High People's Court's Patent Infringement Opinion

2) principles for determining whether a patent or utility model is infringed;

3) principles for determining whether design patent is infringed;

4) principles for determining whether patent rights are infringed in other ways;

5) defences to patent infringement; and

6) a definition section

Each part (with the exception of Part 6) deals with a number of subsidiary issues that arise in the course of applying the Opinion.

Part 1, in setting guidelines for determining the scope of protection for a patent or utility model, first sets out the objects and principles for determining the scope of infringement and then sets out the technical guidance for doing so.

Part 2 sets out the way in which the claims and an alleged infringing product are to be compared and, if necessary, how the doctrine of equivalents is to be applied. Part 2 also specifically approves the application of file wrapper estoppel as well as the application of the "Redundant Designation" principle (which allows for non-essential integers to be overlooked) when interpreting claims.

Part 3 sets out methods to determine the scope of protection for a design and whether the design is infringed. One section specifically deals with how to determine if an alleged infringing design is identical or similar to a registered design.

Part 4 deals with how the court should address allegations of indirect infringement and patent counterfeiting.

Part 5 sets out the scope of counterclaims that can be brought by a defendant in a patent suit.

Part 6 defines a number of terms in the Opinion.

The scope of the Opinion covers a wide range of matters, ranging from what one should consider to be self-evident (for example, Article 5 provides that patent infringement action cannot be taken on a patent that has been revoked or abandoned by a patentee) to complex substantive issues, such as claim interpretation, application of the doctrine of equivalents, application of file wrapper estoppel and how to deal with indirect infringement.

For these more complex issues, the Opinion generally sets out useful guidelines for dealing with such matters.

Claim Interpretation

Part 1 of the Opinion first sets out basic principles of claim interpretation and then provides technical guidance on how these principles are to be applied. The principles set out follow very closely principles enumerated in Europe under the Protocol on the Interpretation of Article 69 of the European Patent Convention.¹

The Opinion states in defining the basic principles of claim interpretation, not only the claims but also the description and drawings should be looked at. This method of interpretation is not clearly defined but rather explained in contrast with the "peripheral limitation" and "central defining" principles. The method of interpretation to be used is found somewhere in between these two methods.

The peripheral limitation principle is defined as limiting the scope of protection to that provided for in the claims; the description and drawings are only used to clarify uncertainties.

The central defining principle is described as being at the other end of the spectrum. It is described as a method of interpretation where the claims only define the general core of the invention, and the scope of protection may be extended to what a technical expert presumes to be the scope of protection claimed by the patentee upon reading the description and drawings.

The object of the method of interpretation set out in the Opinion (and as also stated in the Opinion) is to give due protection to the patentee as well as providing legal certainty to the public. An overly narrow interpretation of claims, as in the peripheral limitation principle, can result in unfairness because, merely as a result of a narrow interpretation of wording in claims a patentee can be refused protection that is clearly contemplated by the description and drawings of the patent. On the other hand, too broad an interpretation of the claims can lead to a case in which members of the public, who are not attempting to infringe a patent, cannot be certain what rights the court will grant the patentee in merely relying on the wording of the claim.

In addition to this basic guidance, the Opinion sets out guidelines for applying the principle of interpretation. The Opinion states that the technical contents in the claims of a patent should be treated as an integrated technical solution. That is, all the technical contents as stated in the independent claims of the patent should be treated as a whole.

Finally, the Opinion states that the claims of the patent should be interpreted in line with equitable principles. Account should be taken of the contribution that the patentee has made over the prior art, so as to duly determine the scope of the patent protection and to protect the rights and interests of the patentee, without prejudice to the public interest.

Technical Guidance

The Opinion then gives technical guidance as to how these principles should be applied.

Some of the technical guidance provisions of the Opinion cover simple points. For example, Article 10 provides that the claims, description and drawings to be considered in interpreting the patent are those of the currently valid patent (i.e., the patent as granted or amended in PRAB decisions); Article 18 provides that the abstract should not be used to determine the scope of the patent or the claims; and Article 20 provides that the patent application file or file from any invalidation proceedings may be used to correct printing errors in the granted patent.

Other provisions are more substantial. These are:

1) the descriptions and drawings may be used to interpret the claims and, depending on the circumstances, extend or narrow the scope of the claims as written (Article 11);

2) when the claims and the description are contradictory, if the defendant does not want to seek a declaration that the patent is invalid from the PRAB, the court may proceed by interpreting the claims alone (Article 12);

3) the description and drawings may be used to interpret the claims when the claims are confusing (Article 13);

4) where dependent claims include technical features necessary to solve a technical problem (and these should have been recorded in independent claims), if the defendant does not wish to seek invalidation of the patent, the court may seek to interpret the dependent claims (Article 14);

5) a technical solution only stated in the description or drawings, but not in the claims, is not protected by the patent. Where the solution is partially provided for in the claims, the court should only provide as much protection as is provided for in the claims (Article 15); and

6) where the description and drawings do not support the claims in the patent, the defendant should apply to the Patent Review and Adjudication Board to invalidate the patent (Article 16).

In addition, the Opinion also provides that the file wrapper history from the application or any revocation or invalidation proceedings may be used to prevent the patentee from going back on any representations made during the application phase (discussed in more detail below).

Determining Infringement

The Opinion also sets out useful guidelines to the court for determining whether an alleged infringing product or process does in fact infringe a patent.

In summary, the Opinion requires that a full comparison should be made between all the necessary technical features of the technical solution as stated in the claims of the patent and those of the alleged infringing article (product or process).

The Opinion states that it is not appropriate to consider the product made by the patentee, any patent held by the defendant, or whether the products are in the same area of application. Rather, the court should only consider if the alleged infringing article (product or process) reproduces all the necessary technical features of the technical solution in the claims of the patent, and the alleged infringing article (product or process) is in full correspondence and identical with all the necessary technical features in the independent claims of the patent. Further, infringement still occurs when an alleged infringing product contains improved features but still falls within the claims of the patent.

Doctrine of Equivalents

The Opinion also sets out how to apply an equivalents principle. This principle is applied in a situation where one or more technical features of the alleged infringing article appears to be literally different when compared with the claimed technical features in the independent claims of the patent, but, upon analysis, the two can be established as containing equivalent technical features.

Article 34 of the Opinion provides the following guidance to determine if a technical feature is an equivalent:

1) when compared with the corresponding claimed technical features, the technical features of the alleged infringing article use basically the same means, perform basically the same function and achieve basically the same effect; and

2) if the ordinarily skilled artisans in the technological field of the patent can think of the technical features upon reading the claims and description of the patent without inventive labour.

Where these points can be established, the Opinion states that infringement should be found. The Opinion also states that for cutting-edge technology, the court should give a broader interpretation to what constitutes an equivalent; conversely, for composite or selective inventions, the courts are required to give a strict interpretation.

Further limitations are imposed on findings of equivalence by Article 42, which provides that a technical feature should not be found to be equivalent when:

1) the technical solution of the alleged infringing article is a known technology before the filing date;

2) the technical solution of the alleged infringing article is a conflicting application or a prior patent for which an application is filed; and

3) the technical features of the alleged infringing article are the technical contents that the patentee specifically precludes from patent protection in the course of patent application, examination for patenting and maintenance of the validity of the patent right. This is one form of file wrapper estoppel that is discussed in the next section.

File Wrapper Estoppel

The Opinion gives guidance on whether and how "file wrapper estoppel" should be applied in patent infringement disputes. File wrapper estoppel is a principle which estops a patentee asserting a scope of protection for the patent that is contrary to a specific assertion made by the patentee as to the scope of protection during the application stage or in the course of revocation or invalidation proceedings.

The Opinion sets out that the court should apply file wrapper estoppel but places the burden of proof on the defendant to make out the estoppel. In order to do so, Article 45 of the Opinion requires that:

1) the assertion of limitation or abandonment by the patentee in respect of the relevant technical features must be explicitly stated and written down in the patent file; and

2) the technical contents in respect of which the assertion of limitation or abandonment of protection is made must have an essential effect on the grant of the patent right or on the maintenance of the validity of the patent right.

Redundant Designation

The Opinion also provides guidelines for a patentee to attempt to have a wider construction placed on the claims by arguing that certain elements of the claim are not essential to the working of the invention and should not be considered when construing the claims. This can be considered to be the converse of the application of the doctrine of equivalents.

Article 50 of the Opinion provides that the following factors should be considered to determine if a claim incorporates a redundant design:

1) whether the technical feature is necessary for distinguishing the patented technical solution from the existing technical solution before the date of application for the patent, and whether it is the technical feature that embodies the novelty or inventiveness of the patent (in other words, whether the patent remains novel or inventive if this technical feature is omitted in the claims of the patent);

2) whether the technical feature is necessary for realizing the aim of the invention, for solving the technical problem the invention is intended for and to achieve the technical effect of the invention (i.e., whether the patent remains capable of realizing or basically realizing the aim of the invention or achieving the technical effect of the invention if the technical feature is omitted in the technical solution of the independent claims of the patent); and

3) the patentee is not estopped from asserting a claim in respect of the technical feature.

The Opinion also states that in considering damages for infringement of a claim that is held to incorporate a redundant design, the patentee's fault in filing an application for a patent of this nature should be reflected in the damages awarded.

Design Infringement

The Opinion also provides guidance for determining if a design is infringed. The principles to be applied are not particularly new or controversial. Basically, the essential novel and aesthetic external features or colours of a design are to be considered and compared to the alleged infringing product. If the alleged infringing product contains the same or similar novel features or colours, then infringement is ascertained. Whether a product is the same or similar is determined from the aesthetic and observational capability of ordinary consumers, not from persons skilled in the art of the design patent.

The Opinion does, however, specifically state that infringement can only be made out where the registered design and alleged infringing product are of the same category. This is to be determined by considering the classification of designs and also taking into account how the goods are sold.

Indirect Infringement

The Opinion also sets out provisions for determining whether a party has been involved in acts of indirect infringement. That is, whether he intentionally induces, aids and abets others to exploit another person's patent, thus resulting in an act of direct infringement.

In order to constitute indirect infringement, the Opinion requires that the products supplied are not articles in general use, but products that play a key part in making a product protected by a patent. This covers special parts for making a product or machinery to work a process patent.

In order to find a case of indirect infringement, the Opinion specifically provides that the person accused of indirect infringement must have knowledge that the product is to be used to infringe, and also an act of direct infringement must in fact occur.

Interestingly, the Opinion states that acts of indirect infringement leading to direct infringement outside China are also actionable. This opens up the possibility of taking action against companies that deliberately produce semi-finished products for export, so as to avoid a claim for direct infringement.

Counterclaims/Defences

The Opinion also sets out guidance on how defences under the PRC Patent Law (中华人民共和国专利法 )are to be handled.

Most importantly, as is required by the Patent Law, counterclaims for invalidity are specifically excluded from trial by the court. A counterclaim for invalidity is required to be brought to the Patent Review and Adjudication Board (PRAB).

The defences dealt with by Part 5 are:

1) a defence based on the abuse of patent right. This covers a situation where the defendant alleges that the patent has expired, has been abandoned or revoked, as well as where it is alleged that the patent has been registered in bad faith, such as by an employee registering an employer's patent;

2) defence of non-infringement. That is, where the defendant alleges that his product is different in some technical feature and therefore does not infringe;

3) defences based on the act being deemed not to be an infringement under the Patent Law. This covers situations where the defendant alleges that:

(a) the patentee has exhausted his rights by consenting to the product being placed on the market;

(b) the defendant has made prior use of the product before the date of application and is continuing to use the product within that scope;

(c) the product was temporarily passing through international borders as provided for in international treaties. This exception is stated not to apply to goods that are transhipped within China's borders;

(d) the defendant has been conducting scientific research and experimentation. The Opinion states that such research and experimentation must be true research and experimentation to produce new products; and

(e) the defendant's action constituted non-intentional acts. Non-intentional acts are deemed to be an infringement, but if the defendant can prove that he obtained infringing products from a legitimate source he will not be liable for damages.

4) a defence based on prior art. Such a defence can only be made in cases where the plaintiff is relying on the doctrine of equivalents. The PRAB is unable to deal with such cases because the question of validity is not to be determined by the exact wording of the patent but by what the patentee alleges is an equivalent. As such the court is required to deal with such cases;

5) a defence based on a claim that the infringing technology was obtained from a third party under contract. The Opinion provides procedures for the defendant to make claims against the third party. However, the defendant is still liable for infringement; and

6) a defence where the defendant alleges the action is time-barred. The statutory bar is two years from the time the plaintiff knew or ought to have known of the infringing acts. The Opinion provides that where the infringing acts have continued for more than two years, the patentee may seek an injunction, but damages will be limited to a period of two years from the date when the plaintiff begins his proceedings.

Conclusion

As we can see, the Opinion provides comprehensive guidelines to the courts in Beijing to assist in handling patent cases and reflects the continued improvement of China's intellectual property system. The implementation of the Opinion should improve the handling of patent infringement cases, and hopefully if the implementation of the Opinion proves to be successful, lead to the adoption of similar guidelines nationwide.

Endnotes:

1 Article 69 and the Protocol can be found at: http://www.european-patent-office.org/legal/epc/e/ar69.html