Supreme People's Court, Annual Report on Intellectual Property Cases (2013) (Abstract)

Based on the requirements of the new situation and new tasks, and taking into account the particularities of cases, the Supreme People's Court, in exercising its intellectual property adjudication functions, displayed the following characteristics: greatly intensified the judicial protection of intellectual property, setting the strengthening of protection as the overall tone for intellectual property trial work at the moment; enhanced the specificity of judicial policy guidance, continuously fleshing out and improving specific judicial policy based on the innovation and development requirements of different industries and technical fields and by taking into account the attributes, functions and features of the various types of intellectual property; focused on leveraging the guiding function of the judicial protection of intellectual property, leveraging the guiding function of rulings and judgments and clarifying the judicial criteria for administrative cases involving the granting and confirmation of intellectual property rights; intensified judicial transparency, intensified efforts at transparency, improved the mechanism for publicising intellectual property adjudication work and actively responded to the new requirements of judicial publicity in the new media era.

This year's report has, from among the intellectual property and competition cases concluded by the Supreme People's Court in 2013, derived 39 law application issues with general guiding significance from 30 carefully selected typical cases (linked cases in which the facts and legal issues were essentially identical are counted as one case). They reflect the Supreme People's Court's adjudication criteria, adjudication methods and judicial guidance for handling new types of, difficult and complex cases in the intellectual property and competition fields.

I. Trial of Patent Cases

1. Trial of Civil Patent Cases

(1) Does the title of the subject matter serve to delimit the scope of protection of a patent?

In the retrial applicant, Starway, v. respondent, Runde, invention patent infringement case [(2013) Min Shen Zi No.790] (hereafter, the “Water Drainage Pipe” Invention Patent Infringement Case), the Supreme People's Court pointed out that, when determining the scope of protection of the claims, the title of the subject matter recorded in the claims should be considered; the actual delimiting effect of the title of the subject matter on the scope of protection of the claims is dependent on the type of effect it has on the subject matter itself the protection of which is sought by the claims.

(2) Determination of the scope of protection of parallel independent claims when a prior independent claim is cited

In the aforementioned “Water Drainage Pipe” Invention Patent Infringement Case, the Supreme People's Court additionally pointed out that, when determining the scope of protection of parallel independent claims citing a prior independent claim, although consideration should be given to the features of the cited prior independent claim, they do not necessarily have a delimiting effect on the parallel independent claims, and their actual delimiting effect should be determined based on whether they have a substantive effect on the technical solution or subject of protection of the parallel independent claims.

(3) Determination of infringement of a closed claim

In the retrial applicant, Xinyu, v. respondent, Monkey King, invention patent infringement case [(2013) Min Shen Zi No.1201], the Supreme People's Court pointed out that, with respect to a closed claim, if the alleged infringing product or method has features additional to the technical features expressly recorded in the claim, it should be found to not fall within the scope of protection of the claim.

(4) Does using a technical solution that is contrary to the technical means delimited by the claims constitute infringement under the doctrine of equivalents?

In the retrial applicant, Jerrat Center, v. respondents, JZTH et. al., utility model patent infringement case [(2013) Min Shen Zi No.1146], the Supreme People's Court held that the technical means of the alleged infringing technical solution were contrary to the technical means expressly delimited by the claims, as was the technical effect, and could not realise the objective of the invention, accordingly, infringement under the doctrine of equivalents was not constituted.

(5) Does changing the sequence of the steps of a method patent constitute infringement under the doctrine of equivalents?

In the retrial applicant, Lesheros, v. respondents, Chen Shundi et. al., invention patent infringement case [(2013) Min Ti Zi No.225], the Supreme People's Court pointed out that the key to determining whether the sequence of steps of a method patent have the effect of delimiting the scope of protection of a patent and thereby limit the application of the doctrine of equivalents when a change is made to the sequence of steps lies in whether the steps involved must be carried out in a specific sequence and whether a change in such sequence will result in a substantive difference in the technical function or technical effect.

(6) Determination of identical or similar product types in the determination of design patent infringement

In the retrial applicant, Weiduoli, v. respondents, Yueyuan et. al., design patent infringement case [(2013) Min Shen Zi No.1658], the Supreme People's Court pointed out that, in a determination of design patent infringement, a determination of whether the product types are identical or similar is based on whether the products have an identical purpose or similar purposes, and details of the sale and actual use of the products may serve as reference factors in determining the purpose.

2. Trial of Administrative Patent Cases

(7) The differences and identity of the methods of interpreting claims in patent grant and confirmation procedures and in civil patent infringement procedures

In the retrial applicant, Seiko Epson, v. respondents, Patent Re-examination Board et. al., administrative invention patent invalidation case [(2010) Zhi Xing Zi No.53-1] (hereafter, the “Ink Box” Administrative Patent Invalidation Case), the Supreme People's Court held that the methods of interpreting claims in patent grant and confirmation procedures and in civil patent infringement procedures are both essentially identical and, in special circumstances, shows certain differences, with the differences particularly manifested in the effect of the arguments of the parties; in a patent grant or confirmation procedure, the arguments of the applicant in the examination file can, in principle, only serve as reference in understanding the meaning of the description and claims, and are not a determinative basis.

(8) Requirements in respect of the writing up of an invention involving the medical use of a substance

In the retrial applicant, Cubist Pharmaceuticals, v. respondent, Patent Re-examination Board, administrative invention patent invalidation case [(2012) Zhi Xing Zi No.75] (hereafter, the “Antibiotic Administration Method” Administrative Invention Patent Invalidation Case), the Supreme People's Court pointed out that, if the substance of an invention and its improvement on prior art lie in the medical use of a substance, when applying for patent protection, the claims should be written up as those for a pharmaceutical preparation method and the technical features relating to the preparation of a pharmaceutical should be used to delimit the scope of protection of the claims.

(9) Does the feature of not generating a specific toxic side effect have a delimiting effect on a medical use invention, the protection of which is sought by the claims?

In the aforementioned “Antibiotic Administration Method” Administrative Invention Patent Invalidation Case, the Supreme People's Court additionally held that, if the feature of not generating a specific toxic side effect in the claims does not change the known target of treatment or indications of a pharmaceutical, and no new property of the pharmaceutical has been discovered, making it insufficient to distinguish it from the known purpose, it does not have a delimiting effect on the medical use invention, the protection of which is sought by the claims.

(10) Does a feature of the administration of a pharmaceutical have a delimiting effect on the pharmaceutical preparation method invention the protection of which is sought by the claims?

In the aforementioned “Antibiotic Administration Method” Administrative Invention Patent Invalidation Case, the Supreme People's Court held that the effect that the feature in the course of the use of a pharmaceutical has on the preparation procedure of the pharmaceutical requires specific determination and analysis; a feature that only manifests itself in the course of use of a pharmaceutical is not a technical feature of the purpose of preparation of the pharmaceutical and does not have a delimiting effect on the pharmaceutical preparation method itself the protection of which is sought by the claims.

(11) Application of the difference of open and closed claims to patents in the mechanical field

In the retrial applicant, CenturyStar, v. respondents, Patent Re-examination Board et. al., administrative invention patent invalidation case [(2012) Xing Ti Zi No.20] (hereafter, the “Fire Extinguishing Device” Invention Patent Invalidation Case), the Supreme People's Court held that the term “including” or “comprising” itself has the connotation of not excluding contents that are not indicated, making it an important mark of an open patent claim; the difference in open claims and closed claims is universally applicable in all technical fields, including the chemical and mechanical fields.

(12) Determination of the distinguishing technical features in open claims

In the aforementioned “Fire Extinguishing Device” Invention Patent Invalidation Case, the Supreme People's Court held that, when determining the distinguishing technical features in open claims corresponding to those in the comparative documents, if a certain technical feature in the comparative documents is not expressly mentioned in the open claims, in general, the absence of such technical feature is not treated as a distinguishing technical feature of the open claims corresponding to those of the comparative documents.

(13) In determining whether technical bias exists, consideration needs to be given to prior art as a whole

In the appellant, Arysta, v. appellee, Patent Re-examination Board, administrative invention patent case [ref. (2013) Zhi Xing Zi No. 31], the Supreme People's Court held that, in determining whether prior art contains technical bias, it is necessary to take into consideration the prior art as a whole.

(14) Determining whether a revision of patent application documents exceeds the scope

In the retrial applicant, Shimano Inc., v. respondents, Patent Re-examination Board et. al., administrative invention patent invalidation case [(2013) Xing Ti Zi No.21] (hereafter, the “Rear Derailleur” Administrative Invention Patent Invalidation Case), the Supreme People's Court pointed out that the phrase “the scope described in the original description and claims” in Article 33 of the Patent Law should be understood as all the information of the invention/creation presented in the original description and claims; when examining whether a revision of patent application documents exceeds the scope described in the original description and claims, consideration should be given to factors such as the technical characteristics and regular expressions in the field in question, the knowledge level and cognitive capacity of a person having ordinary skill in the art and the intrinsic technical requirements of the technical solution itself.

(15) Revision of a “non-inventive point” in patent application documents and remedies

In the aforementioned “Rear Derailleur” Administrative Invention Patent Invalidation Case, the Supreme People's Court additionally pointed out that in order to avoid a situation where a genuinely creative invention/creation loses the deserved patent corresponding to the contribution it has made to the prior art because a revision to a “non-inventive point” exceeds the scope described in the original description and claims, the relevant department should actively seek appropriate resolution and remedy channels, and while guarding against the patent applicant gaining unfair first-to-file benefits, actively succor an invention/creation that has technical innovation value.

(16) Can an applicant secure protection of the reliance interest based on the acceptance by the examiners of revisions to the patent application documents?

In the aforementioned “Ink Box” Administrative Patent Invalidation Case, the Supreme People's Court additionally pointed out that, in principle, revision of the patent application documents is a right of the applicant; the State Council's patent administrative department exercises its power of examining patent applications in accordance with the law, but does not bear the responsibility of ensuring that the grant of a patent is correct and in good order and the applicant himself/herself/itself bears the liability for all the consequences arising from revisions made by him/her/it.

(17) Effect of the arguments of the concerned party when determining whether revisions to patent application documents are lawful

In the aforementioned “Ink Box” Administrative Patent Invalidation Case, the Supreme People's Court additionally held that, when determining whether revisions to patent application documents are lawful, the arguments of the concerned part usually can only serve as reference in understanding the connotation of the description and claims, and are not a determinative basis; the reference value thereof is dependent on the specific contents of the arguments and their relationship with the description and claims.

II. Trial of Trademark Cases

1. Trial of Civil Trademark Cases

(18) Recognition and proper use of generic names of goods

In the retrial applicant, Qinzhouhuang, v. respondents, Tanshanhuang et. al., trademark infringement case [(2013) Min Shen Zi No.1642], the Supreme People's Court held that, for goods the relevant market for which is relatively fixed due to reasons such as history, tradition, local customs and conditions, and geographical environment, its generic appellation in the relevant market may be recognised as the generic name; the trademark registrant may not claim trademark rights in the generic name of the good on the grounds of its contribution to promotion in the market for the good, and does not have the right to prohibit others from using the generic name to indicate the source of a variety of the good.

2. Trial of Administrative Trademark Cases

(19) Presumption of status as agent or representative as specified in Article 15 of the Trademark Law.

In the retrial applicant, Xindongyang, v. respondent, Hsin Tung Yang, and defendant at first instance, Trademark Review and Adjudication Board, administrative trademark opposition re-examination case [(2013) Zhi Xing Zi No.97], the Supreme People's Court pointed out that a party who colludes with an agent or representative in carrying out the pirate registration of a trademark can be deemed an agent or representative; in determining whether collusion in carrying out pirate registration of a trademark is constituted, depending on the circumstances, presumption can be made based on the specific status relationship of that party with the agent or representative.

(20) Application of the phrase “using improper means to preemptively register a third party's trademark that is already in use and that has a certain degree of influence” in Article 31¹ of the Trademark Law and the exceptions thereof

In the retrial applicant, Fushun Boge, v. Trademark Review and Adjudication Board and Yingkou Fibreglass administrative trademark dispute case [(2013) Xing Ti Zi No.11], the Supreme People's Court held that, in normal circumstances, where a trademark applicant is well aware or ought to be aware of another's trademark that has had prior use and has a certain degree of influence applies to register the same, it can be presumed that he/she/it has the intent of exploiting the reputation of the other's trademark for gain. However, it cannot be ruled out that, under special circumstances, although the prior trademark has already had a certain degree of influence, the trademark applicant does not have the malicious intent of appropriating the reputation of the prior trademark.

(21) A commercial mark that has not been used for an extended period of time may not be protected as an unregistered trademark with a certain degree of influence or a prior right

In the retrial applicant, Yu Xiaohua, v. Trademark Review and Adjudication Board and third party, Chengdu Tongdefu, administrative trademark dispute case [(2013) Zhi Xing Zi No.80], the Supreme People's Court pointed out that the “certain degree of influence” mentioned in Article 31¹ of the Trademark Law is a legal effect arising on the basis of continuous use, and “prior right” means an existing right that was still in existence on the filing date for the disputed trademark; once it has not been used for a long time, a commercial mark ceases to have the notoriety and influence of an unregistered trademark as specified in Article 31¹ of the Trademark Law, and therefore does not constitute a trademark with prior use and a certain degree of influence or a prior right.

(22) Determination of “other improper means” as specified in the first paragraph of Article 41² of the Trademark Law

In the retrial applicant, Li Longfeng, v. respondent, Trademark Review and Adjudication Board, and third party at first instance, Haitangwan Committee, administrative trademark dispute cases [(2013) Zhi Xing Zi Nos.41 and 42], the Supreme People's Court pointed out that “registration was obtained by … other improper means” as specified in the first paragraph of Article 41² of the Trademark Law means that registration was obtained by means, other than fraud, that disturb the trademark registration order, harm the public interest, improperly appropriate public resources or otherwise permits the obtaining of improper benefits; when a civil subject applies to register a trademark, he/she/it should have the genuine intent of using the same, and his/her/its applying for registration of a trademark should be reasonable and legitimate.

(23) The notoriety of different registered trademarks of one subject may have a radiating effect under specific conditions

In the retrial applicant, Bonneterie, v. respondents, Trademark Review and Adjudication Board and Mingshi, administrative trademark dispute case [(2012) Xing Ti Zi No.28], the Supreme People's Court held that the notoriety of different registered trademarks of one subject may have a radiating effect under specific conditions; where the representation of a disputed trademark already had a relatively high degree of notoriety before the filing date of the disputed trademark due to the long-term and wide use of a similar trademark by the same subject, and the cited trademark lacks notoriety, the scope of exclusivity of the cited trademark should be limited.

III. Trial of Copyright Cases

(24) Conditions for an object that is both practical and artistic to be accorded protection as a work of art

In the retrial applicant, Lego, v. respondents, Loongon et. al., copyright infringement cases [(2013) Min Shen Zi Nos. 1262 to 1271, 1275 to 1282, 1327 to 1346 and 1348 to 1365], the Supreme People's Court pointed out that the requirements in respect of originality for different types of works are not entirely identical, with the originality of a work of art requiring the reflection of the author's unique creativity and ideas in the field of esthetics; with respect to an object that has both appreciation value and practical value, whether it may be protected as a work of art is dependent on the unique character and creativity manifested out of the intellectual labour expended esthetically by the author, and the intellectual labour that does not fall within the field of esthetics is irrelevant to originality.

(25) Scope of protection of three-dimensional modelled works of art and determination of the infringement thereof

In the retrial applicant, Franz, v. the respondent, Gallant, copyright infringement case [(2012) Min Shen Zi No.1392], the Supreme People's Court held that design ideas and the corresponding process method are not subjects of protection of the Copyright Law, and a rights holder may not monopolise the corresponding design ideas and process methods by virtue of the Copyright Law; others may use the same design ideas and process methods to design and produce products with similar themes, but may not copy the original expression of another.

IV. Trial of Competition Cases

(26) Can the rights and interests in the packaging and trade dress specific to a well-known good be succeeded to?

In the retrial applicant, Guilin Pharmaceutical, v. respondent, Sinoway, design patent infringement and unauthorised use of packaging and trade dress specific to a well-known good dispute case [(2013) Min Ti Zi No.163], the Supreme People's Court pointed out that the packaging and trade dress specific to a well-known good are property rights and interests protected by the Anti-unfair Competition Law, and can be transferred and succeeded to in accordance with the law.

(27) Relationship of the specificity and novelty of the name, packaging and trade dress of a well-known good

In the retrial applicant, Sino-culture Press, v. respondents, Jilin Literature and History Press et. al., copyright infringement and unfair competition case [(2013) Min Shen Zi No.371] (hereafter, the Book Men Are from Mars, Women Are from Venus Unfair Competition Case), the Supreme People's Court pointed out that the specificity of the name, packaging and trade dress of a well-known good means that the name, packaging and trade dress of the well-known good has the function of distinguishing the source of the goods, not that the name, packaging or trade dress is novel or original; the fact that the name, packaging or trade dress of a good is not novel or original does not signify that it necessarily lacks specificity.

(28) Information that does not have market attributes is not a trade secret

In the retrial applicant, Wang Zhean, v. respondents, International Center of the Ministry of Health et. al., trade secret infringement case [(2013) Min Shen Zi No.1238], the Supreme People's Court pointed out that the competition regulated by the Anti-unfair Competition Law is not any manner and any scope of competition, but rather specifically refers to the “market competition” between business subjects in the market; trade secrets should be grounded in the market, and information that gives concerned parties job competition advantages within an entity does not constitute trade secrets.

V. Trial of Intellectual Property Contract Cases

(29) Is a licensing contract for a trademark yet to be granted registration valid

In the retrial applicant, Taisheng, v. respondents, Yehongda et. al., trademark licensing contract dispute case [(2012) Min Shen Zi No.1501], the Supreme People's Court held that laws and regulations do not set forth provisions that prohibit the licensing to another of a trademark that has yet to be granted registration, and the parties to the trademark licensing contract also did not specifically provide that the trademark be registered. Accordingly, the claim by a party that the licensing contract is invalid on the grounds that the licensing of an unregistered trademark constituted fraud was denied.

(30) Continuity of the obligation of the transferor under a technology transfer contract to ensure that its technical information is true

In the retrial applicant, Furui Research Institute, v. respondent, Jichuan, technology transfer contract dispute case [(2013) Min Shen Zi No.718], the Supreme People's Court held that where a transfer of technology under an application for an approval document for a clinical trial of a pharmaceutical occurs, the technology transferor continues to bear a contractual obligation and statutory obligation to ensure that the information and data it submits at the subsequent stage of submission for the production of the pharmaceutical are true and reliable.

VI. Bearing of Liability for the Infringement of Intellectual Property Rights

(31) Determination of the specific means of bearing the civil liability of ceasing infringement

In the aforementioned Book Men Are from Mars, Women Are from Venus Unfair Competition Case, the Supreme People's Court additionally held that determination of the specific means of bearing the civil liability of ceasing infringement should conform with the principle of proportionality and take into account the particularities of the alleged act, and consideration is to be given to the conformity with the aim, necessity and balance of the specific liability method.

(32) Civil liability when a corporate trade name conflicts with a registered trademark

In the retrial applicant, Dabao Cosmetics, v. the respondents, Dabao Daily Chemical et. al., case of infringement of the exclusive right to use a registered trademark and unfair competition dispute [(2012) Min Ti Zi No.166], the Supreme People's Court held that when a corporate trade name conflicts with a registered trademark, the matter should be handled based on the specific circumstances of the case: if the prominent use of the enterprise name infringes the exclusive right to use the registered trademark, an order may be given to use the enterprise name in a compliant manner; if the enterprise name has been used in good faith for a long time due to a special historical relationship, a decision not to order a change in the enterprise name may be rendered.

(33) The prior agreement between a patent holder and an infringer may serve as the basis for determining the measure of damages for infringement of the patent

In the retrial applicant, Lerado, v. respondent, Tongba, utility model patent infringement case [(2013) Min Ti Zi No.116], the Supreme People's Court held that where the infringer infringes again after having reached agreement with the rights holder on the measure of damages for further infringement, the People's Court may directly apply the agreement in question in determining the measure of damages for infringement.

VII. Intellectual property litigation procedure and evidence

(34) The place of the effect of the infringement should be understood as the place where the result directly caused by the infringement occurred

In the retrial applicants, Zhengzhou embellish and Chen Tingrong, v. the respondents, Hubei Jieda et. al., case of opposition to jurisdiction in a trade secrets infringement dispute [(2013) Min Ti Zi No.16], the Supreme People's Court pointed that the place of the effect of the infringement should be understood as the place where the result directly caused by the infringement occurred. It should not simply be determined that because the plaintiff was harmed the domicile of the plaintiff is the place where the result of the infringement occurred.

(35) A legal action of an opposing nature with a linkage to the legal action in question may be accepted as a countersuit

In the retrial applicant, Jiangxi Geli, v. respondents, Jiangxi Meidi et. al., unfair competition case [(2013) Min Shen Zi No.2270], the Supreme People's Court held that uniformity with the case in question in terms of the specific facts and legal relationship is not a necessary condition for a countersuit; a legal action with clear specificity, opposition and relevance to the legal action in question instituted based on a connection between the reasons for their arising may be, due to its linkage with the legal action in question, handled as a countersuit.

(36) Evidence that could not be punctually submitted due to a change in the focal point of the dispute is “new evidence”

In the retrial applicant, Astellas Pharma, Inc., v. respondents, List Pharmaceutical et. al., invention patent infringement case [(2013) Min Shen Zi No.261] (hereafter, the “Tetrahydro Benzimidazole Derivative Preparation Method” Invention Patent Infringement Case), the Supreme People's Court held that where, after the expiration of the period for adducing evidence, a party, due to a change in the focal point of the dispute, provides additional key evidence to support his claim and failure to examine the same could result in the judgment or ruling being clearly unfair, such evidence should be deemed to be “new evidence”.

(37) Legitimacy of investigation and collection of necessary evidence ex officio by a people's court

In the aforementioned “Tetrahydro Benzimidazole Derivative Preparation Method” Invention Patent Infringement Case, the Supreme People's Court held that the collection by the people's court of evidence necessary for the purpose of examining and verifying the truthfulness of the evidence provided by the parties constitutes exercise of the functions and powers bestowed upon it by the Civil Procedure Law, and does not violate the statutory procedure.

(38) Is the forensic conclusion issued by a foreign forensic analyst admissible?

In the retrial applicants, Tsuburaya Productions and Shanghai Tsuburaya, v. respondents, Sompote Saengduenchai et. al., copyright infringement case [(2011) Min Shen Zi No.259], the Supreme People's Court held that a forensic conclusion may serve as the basis for determination of the facts only after examination and evaluation; a forensic conclusion the evaluation procedure for which was lawful and that is not opposed by the parties may, in general, serve as a basis for determining the relevant case facts by the court; as to the question of whether a forensic conclusion issued by a foreign forensic analyst is admissible when a party has raised doubts about it, it should be examined in accordance with relevant Chinese laws.

(39) Presumption of facts in a patent infringement dispute involving a manufacturing method for a product that is not new

In the retrial applicant, Weifang Henglian, v. the respondents, Yibing Changyi et. al., invention patent infringement case [(2013) Min Shen Zi No.309], the Supreme People's Court held that where the patent holder is able to demonstrate that the alleged infringer manufactured identical products but is unable, despite reasonable efforts, to show that the alleged infringer in fact used the patented method, and it can be determined based on the specific circumstances of the case and by taking into consideration the known facts and normal life experience that the possibility of the identical products having been manufactured by the patented method is great, and the alleged infringer refuses to cooperate with the court's investigation and collection of evidence or preservation of evidence, it can be presumed that the alleged infringer used the patented method

Translator's notes:

1. Revised to become Article 32 in the PRC Trademark Law (3_rd Revision) promulgated on August 30 2013.

2. Revised to become Article 44 in the PRC Trademark Law (3_rd Revision) promulgated on August 30 2013.