Judicial Enforcement and its Evolution

The Regulations also provide that disputes concerning new plant varieties can be resolved using the court system. Article 39 of the Regulations provides that "the variety rights holder or the party having an interest therein may file a suit with the People's Court according to civil action procedures". Article 44 provides that: "[w]here disputes arise as to the right to apply for a new variety of plant and the ownership of the variety rights, the parties concerned may file a suit with the People's Court". The Regulations, however, provide little guidance to litigants and the courts concerning the nature and scope of judicial remedies, judicial review, standing, among other issues. Relevant to judicial actions, the Detailed Administrative Rules clarified a few procedural issues involving, for example, the jurisdiction and the suspension of court proceedings in relation to a co-pending administrative proceeding.

To facilitate judicial enforcement, the Chinese Supreme Court on February 5 2001 issued its Judicial Interpretation of the Supreme People's Court on Several Issues Relating To Disputes Over New Plant Varieties.⁵ Most significantly, these rules defined the jurisdiction of various courts to handle various types of judicial actions involving new plant variety disputes, from judicial review of an administrative ruling to claims of infringement in the first instance.⁶

The last five years saw a dramatic increase in the number of new plant variety-related cases filed in China. For example, there were 36 such cases filed before the trial courts in China in 2002. Based on reported statistics, the number of such cases filed increased to 175 in 2005.⁷ Due to the complexity of the issues involved in such cases and the lack of guidance in the Regulations and the Detailed Administrative Rules, there has been increasing demand from the trial and appellate courts, as well as from the parties, for the Chinese Supreme Court to issue further guidance on how these cases can be handled.

Outline of the Supreme Court's new Guidance

As a result, the Chinese Supreme Court issued its Specific Law Application Issues Concerning Trials of Disputes over Infringement upon Rights to New Varieties of Plants on January 12 2007, which went into effect February 1 2007 (the Specific Law Application Issues).

The Specific Law Application Issues consists of eight articles. Moving from the undefined concept of "parties concerned" and "parties having an interest" in the Regulations, the Supreme Court defines "interested party" and the standing requirements in bringing a new plant variety lawsuit. In Article 1 of the Specific Law Application Issues, the Court provides that the term "interested party" includes licensee and the heir of the owner. It further provides that an exclusive licensee has standing to file a lawsuit, and a non-exclusive licensee may bring a lawsuit to enforce the intellectual property rights when the non-exclusive licensee has the permission of the owner.

Article 2 sets forth the definition of infringement of the intellectual property rights in a new plant variety, including identifying two categories of acts, which if proved, constitute infringement.

Article 3 deals with the selection or designation of a third party to be an appraiser for the technical and scientific aspects of the infringement determination. The parties may jointly select the appraiser, and the courts may appoint an appraiser when the parties are not able to select one on their own.

Article 4 sets forth the methodology the courts should apply in determining infringement, which includes field observation and DNA finger print analysis. It merits noting that although field observation is considered to be a more reliable method for determining the characteristics of the subject matter at issue, obtaining conclusive results using this method requires a long period of time, sometimes more than one year, and thus is often deemed impractical in practice.

Article 5 states that owners of new plant varieties may seek and obtain injunctive relief, and may petition the courts for evidence preservation before the trial of a case. The Regulations did not contain any provision on providing injunctive relief and preserving evidence before or during a trial. Nor does the 1978 text of the UPOV to which China is a signatory. The availability of injunctive relief is a significant enhancement in the remedies afforded to rights' holders and is in keeping with the trend towards expanding remedies available to intellectual property owners in the Chinese courts.

Article 6 relates to the determination of damages. In particular, the courts may determine the amount of compensation by taking into consideration the damages the owner or interested party suffered from the infringement and the profits generated by the infringer as a result of the infringement. In the case that the damages or profits are too speculative or otherwise could not be determined, the courts may grant damages to the owner or interested party in an amount up to Rmb500, 000 (about US$64,000).

Article 7 relates to treatment of the infringing materials. This article provides that the infringing materials may be included as part of the compensation to the owner of a new plant variety or an interested party. Issues relating to the destruction of the infringing materials can be a socially sensitive issue, and courts generally prefer not to order the destruction of the infringing materials.

Article 8 relates to an individual grower's liability in an infringement case. This article states that growers are only liable for infringing the intellectual property rights of the owner of a new plant variety or an interested party when the grower knowingly infringes the claimant's rights.

Conclusion

Different mechanisms are utilized by various countries in the protection of intellectual property rights in new plant varieties. In the United States, for example, new plant varieties may be protected through utility patents, plant patents, or Plant Variety Protection Certificates. As we have seen in this article, new varieties of plants may only be protected under the plant variety protection certification system in China. Although the opinions of the Chinese Supreme Court provide needed guidance to parties involved in a new plant variety-related matter (e.g., a court, an owner, or an alleged infringer), comprehensive legislation enacted by the People's Congress may be necessary and should probably be expected in future years as part of the continuing development to provide an efficient and strong system for the protection of the intellectual property rights in new varieties of plants.

It should also be anticipated that the creation and development of new varieties of plants will continue to grow in importance in China's economy as in the world economy. The development of higher yielding crops, with increased germ resistance, has been a very important objective in China and across the globe for decades. The development of new fibers for fabrics and new botanicals is likewise very important commercially. The increasing interest in renewable energy, including the hunt for better "energy crops" is likely to make the legal regimes for the creation and development of new plant varieties even more important.

About the authors

Dr. Eric Lei Tang is an associate in Troutman Sanders' IP Group in its Atlanta office, with a practice emphasis on patents for life sciences, nanotechnology, and related technologies. Eric received his J.D. from St. John's University in January, 2007, and his Ph.D. in biochemistry and cell biology from Rice University in 2001.

Eric Szweda is Head of Troutman Sanders' Hong Kong office. Eric is a U.S. qualified lawyer and a Foreign Legal Consultant in Hong Kong and advises on commercial disputes and intellectual property matters. Eric received his B.S. from Cornell University in 1987 and his J.D. from Vanderbilt University in 1990.

Endnotes

1 The Regulations are sometimes referred to as "The Ordinance on Protection of New Plant Varieties." The Regulations can be found at the Office of Legislative Affairs of the State Council's website.

2 See Response to Questions from Reporters on the Interpretation of Matters Concerning Trials of Disputes over Infringement upon Rights to New Varieties of Plants, http://www.law-lib.com/fzdt/newshtml/21/20050710221513.htm.

3 Id. The Detailed Administrative Rules can be found at the Office of Legislative Affairs of the State Council's website.

4 Chai Su Jun, Enhance the Protection of New Varieties of Plants in Zhejiang Province,

5 Lin Shi Yu, The Role of the People's Procuratorate in the Protection of Trade Secrets and New Varieties of Plants,

7 Jiang Zhi Pei, Li Jian, and Luo Xia, Explanation of the Specific Law Application Issues Concerning Trials of Disputes over Infringement upon Rights to New Varieties of Plants ("Explanation"),