Opinion: Patent disputes make headway

The Supreme People's Court (SPC) has once again amended its judicial interpretation on the law on patent disputes, after the amendment in 2013 to Article 2 of the 2001 interpretation on first instance jurisdiction.

The amendment to Article 5.2 of the Decision on Amending the «Supreme People's Court, Several Provisions on Issues Concerning the Application of the Law in the Trial of Patent Disputes» (Draft for Public Comments) (最高人民法院关于修改《最高人民法院关于审理专利纠纷案件适用法律问题的若干规定》的决定 (公开征求意见稿)) is made in accordance with Article 11.2 of the PRC Patent Law (3rd Revision), which adds “offer to sell” to the provisions relating to design patents. Patent holders will since have “the place where the offer to sell took place” as an additional link to create a jurisdiction to their advantage.

Articles 8.1 and 9.1 have also been updated and while they are an adjustment to Article 61.2 of the new Patent Law, they are also meant to rectify the previous practice of incorrectly making patent search reports a prerequisite for filing an action. They also specify the effective period of a patent search report or assessment report. Further, the relations between the two reports and proceedings are also clarified to enhance operability relating to the use of search reports and assessment reports.

The amendment to Article 17 reiterates the principle of defining patent protection scope by all technical features, rather than applying the redundancy doctrine or excluding non-necessary technical features. This is in line with Article 7 of the SPC's 2009 interpretation. It also specifies for the first time that the judgment on equivalent infringement will relate to the date of infringement rather than the date of application, publication or issuance. This is more in line with fault-based liability to determine equivalent infringement at the time when such infringement takes place, which is also fair, reasonable and more conducive to patent protection. In fact, the Beijing Higher People's Court has made a similar provision in its Guidelines for Judging Patent Infringement released at the end of 2013.

The amendment to Article 19 adjusts the citations of Article 63 of the Patent Law. However, as the current Patent Law no longer distinguishes “counterfeiting others' patents” and “passing off the patent of another as its/his/her own,” it seems improper that the amendment continues using the concept of “counterfeiting others' patents.” It is necessary to clarify the types of infringement under the category as it does in Article 84 of the Implementing Rules for the PRC Patent Law (2^nd Revision). Similarly, the “place of infringement by counterfeiting others' patents” in Article 5.2 needs definition in the same line. This may also indicate that the new Patent Law provision in this regard is not entirely appropriate.

Article 20 was also revised in response to Article 65 of the new Patent Law, which changes the way of claiming damages from choice of the claimant to a statutory sequence of availability. However, this lacks operability in practice. Currently, Chinese courts in general continue to let the claimants decide on the basis of calculating damages.

Moreover, “One to three times of royalty” has been removed from Article 21 because, as the determination of royalties can be arbitral in itself, confining damages to one to three times of royalties not only lacks practical meaning but may prevent the award of reasonable damages.

It also makes sense to separate reasonable expenses from damages as the two are of entirely different nature, as reflected in the amendment to Article 22. However, this point was not specified previously in the case of applying statutory damages. The practice of different courts varies as to whether reasonable expenses should be included in statutory damages, as some courts follow the requests of claimants, while others exercise their discretion.


Xi Sun, Lifang and Partners, Beijing


More from CLP:
Supreme People's Court, Decision on Amending the «Supreme People's Court, Several Provisions on Issues Concerning the Application of the Law in the Trial of Patent Disputes» (Draft for Public Comments)
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