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Judicial Protection of IPR in China
 

Key words: patent, litigation, ownership, China, criminal, civil, legal management, administrative, maritime claims, intellectual property, case

The first Patent Law of new China was promulgated in March 12, 1984, which built the first block of the patent system of China and made an important progress towards the science development and legal management of the country. Since the April of 1985, Chinese courts started to hear cases of patent disputes. The Supreme Court of China had issued an announcement for regulating types of disputes acceptable to courts, jurisdiction, litigation procedure and appointment of competent judges. This is the beginning of the patent litigation in P. R. China. Thereafter, the Standing Committee of the People's Congress of China revised the Patent Law of China in September of 1992 in order to carry out the Chinese government policies of open up and reform, as well as implementing the "Memorandum of IP between US and China". Chinese legislation body is working on the second revision of the Patent Law of People's Republic of China. It is believed that this second revision is going to follow the three principals adopting good experiences of other countries, fitting the Chinese conditions and adhering to the international treaties. Also, this revision will reflect the needs of China and the principals of the international standards. The patent law and its revision will have great impact on the patent litigation. Besides, the Organizational Law of Court, Civil Procedure, Administrative Procedure and the Judicial Interpretations of the Supreme Court also play very important role in establishing and improving the patent litigation system.


The Chinese patent litigation has a history of only 14 years. However, a patent litigation system with Chinese style has been formed as below:
A. Types of Patent Disputes and Jurisdiction


The Intellectual Property Tribunals of Chinese court receives 5 categories of cases as below:


1. Patent Administrative Cases. These patent administrative cases are the one that the Reexamination Board or the Chinese Patent Office is the defendant, which includes: dispute on grant of patent, patent invalidation and upholding, and compulsory licensing.


2. Patent Infringement Cases. In these cases, patentee or relevant parties pursue damages against the infringement conduct of the alleged infringer. These cases may include infringement of patent for invention, utility model and design.


Disputes Relating to Ownership of Patent, including disputes regarding patent rights or right for application.


Patent Contractual Disputes, including contractual disputes of assignment of patent right, right of patent application, and patent licensing.
Other patent related disputes, including royalty of compulsory licensing, royalty for using the patented technology at the time between the publication of the application and grant of patent for invention, utility model and design.


Besides, Chinese courts also handle cases of criminal offense on passing off patents. Punishment of passing off patent can be up to 3 years prison and fine. For the cases of passing off patent, the criminal court with jurisdiction will handle them.


From the very beginning, Chinese court has specified the jurisdiction over patent related cases on the basis of international practice and the nature of the patent disputes. Various kinds of dispute mentioned above are assigned to the following courts:


1. For the patent administrative disputes relating to grant of patent, patent invalidation and upholding, and compulsory licensing and its royalty, the Beijing First Intermediate People's Court has the jurisdiction as the trial court because the Reexamination Board of patent and China Patent Office reside in Beijing. The Beijing Higher People's Court is the appellate court for these cases.


2. For the rest kinds of disputes mentioned above, the trial court are Intermediate People's Court residing in the locality of the corresponding municipal and provincial government in each of the municipalities, provinces, coastal special economic zones, as well as the Intermediate People's Court assigned by the Supreme People's Court. The corresponding Higher People's Court is the appellate court.


Except the above-mentioned jurisdiction, the most happened infringement disputes will also follow the general jurisdiction principal of locality of the civil law, i.e., the Intermediate People's Court of the residency of the infringer (including the locality where the infringing conduct carried out) has the jurisdiction as the trial court(note14).


B. Structure and Organization for Patent Litigation
According to the legislatures of China, the judicial system of China has four levels of courts and adopts two instances litigation for final. The four levels of courts are, District People's Court, Intermediate People's Court, Higher People's Court and the Supreme People's Court. Final judgment will have to be made through trial court and appellate court. Most patent disputes have been ended in the trial court or appellate court. However, there are few cases handled by High People's Court as the trail court due to the huge amount of damages and sever impact to the society. If these cases will appeal, the Supreme People's Court will be the appellate court. According to the law, the Supreme People's Court has the function of making Judicial Interpretation regarding patent litigation as well as the supervision and guiding to the adjudication of each level of People's Courts. If a erroneous judgment is found, the Supreme People's Court has the right to review the case or remind the case to the original court no mater at which level the error was happened.


Within each court, there are tribunals for criminal, civil, economic, administrative, maritime claims, intellectual property, etc. The Chief Judge, judges and assistant judges of the IP tribunal will hear patent disputes. According to law, each panel to hear the patent dispute case will consist of 3, 5, or 7 judges. In the trial court, people's juror who is an expert of law or technology may join the panel with the judge as the presiding judge. However, panel must be consisting of only judges for the appealed cases.


Within each Chinese court, there is an adjudication committee consisting of experienced Judges. These committees will analysis and decide cases with great difficult and complexity. Each year, there will be 1-2 cases submitted to the adjudication committee of Supreme People's Court for discussion. For the cases submitted to the adjudication committee of Supreme People's Court for discussion, it normally has been decided through the panel of judges with a draft of decision. General Director and Deputy Director of each court have the right to submit a case to the adjudication committee upon the proposal of presiding judge of the panel. When the adjudication committee conducts its discussion, presiding judge normally will present the case to the committee, including facts, evidences and proposed judgment. Then, the members of the committee will discuss the case and vote for a final judgment on the basis of minority is subordinate to the majority. According to law, the decision of the adjudication committee is the final judgment of the court on that particular case. The presiding judge of the panel will have to obey the decision of the adjudication committee. The members of the adjudication committee have extensive judicial experiences and legal knowledge. Their decision is of great authority. All the Judicial Interpretation of Supreme People's Court (contents of these Judicial Interpretation are similar to those judicial principals in the case law decision) will have to be discussed and approved by the adjudication committee. All the members of these adjudication committees have made a great contribution to the legal system of China. However, during the reform of legal system of China, there is a trend that the function of such an adjudication committee tends to be lessened. More and more power and responsibility has been shift to the presiding judges when handling cases with difficulty and complexity for the purpose of efficiency. A newly established procedure for correcting cases with erroneous judgment will balance such a trend. Besides, Chinese court has adopted the institution of engaging experts of Intellectual Property Law and technology. Expert from university and researching institutions who has the knowledge of relevant technical field and experiences will be engaged as People's Juror to join the panel to hear the cases. All these measures have enhanced capability of Chinese court on handling difficult and complicated IP cases and the quality of their judgment.


C. General methods used by Chinese Judges in Patent Infringement Cases


Patent infringement disputes are often dealt with by intellectual property judges of China, and are the majority cases among various patent lawsuits. The general methods used by Chinese judges in deciding such type of cases are described below:


(I) Methods on Judicial Procedure
1. Parties concerned shall be notified in advance of the judicial rights they are entitled and the judicial obligations they shall comply with during lawsuits. After a case is accepted by the court, both the plaintiff and defendant shall be notified with a list of judges of the collegial panel, the rights they are entitled and the judicial obligations they shall comply with according to the Civil Procedure Law of China.


2. Conducting pre-trial Exchange of Evidences. While observing the burden of proof on the plaintiff, the parties concerned shall exchange evidences prior to opening of the trial. Thus, parties concerned will understand the bases of judicial pleads and claims between each other, and gain prior knowledge about evidences that are characterized by strong technical nature. On trial, facts and evidences that are disputed among parties concerned shall be verified and cross-examined. Hearings with respect to technical issues and conclusions of technical appraisals shall be held prior to the opening of the trial, so as to ensure quality and efficiency of the trial. The burden of introducing evidences for patent infringement lawsuits is usually following the rules of evidence as stipulated in the Civil Procedure Law of China, i.e. "Those who advance shall introduce evidences". When plaintiff accuses the defendant for infringement of patent rights of the plaintiff, then the plaintiff shall be responsible in the first place for proposing the rights that the plaintiff is entitled and relevant evidence about the patent infringement by the defendant. But it should be noted that, if the patent that the defendant should have been accused by the plaintiff to have infringed is a manufacture process of a new product, i.e. process invention patent, then according to the regulations in Clause 2, Article 60 of the Patent Law of China, reversal of burden of proof shall be implemented for the "manufacture process" that is disputed whereby the party who makes the same kind of product and who is accused of infringement shall be responsible for providing evidences for the manufacture process of such product.


3. The system of collegial panel is implemented. A patent litigation pertains to expertise and technologies of various disciplines, and is characterized by difficulty of trial. Generally, a patent case is tried by a Chinese court according to general procedures as stipulated in the Civil Procedure Law of China, i.e. a collegial panel is formed by several judges for trail of such a case instead of one single judge. All and any judge forming the collegial court shall review and examine the files of the case, participate in the trial and collegial discussion, and jointly understand the responsibility of conclusion of fact and application of law for the case.


4. Public trial is implemented. For any and all patent disputes cases, regardless of the first trial or the second trial, public trial is implemented whereby the public are allowed to observe, and the media are allowed to interview and report objectively. Such a doing can increase the transparency of the trial and ensure judicial fairness; and can educate and publicize legal knowledge about intellectual property rights to the mass and community, enhance citizen and legal person respect and the awareness of protecting the intellectual property rights.


5. Limitation of Claims of Patent Infringements. The limitation of claims of any patent infringement litigation is two years according to the regulations of the "Patent Law of China" and the "General Principles of the Civil Law of China", starting from the date when the patentee or the interested party knows or should have known about the infringement action. For those continued patent infringement actions, if the patentee fails to investigate within two years after the date when the patentee knows or should have known about such patent infringement actions, and the patent rights of the said patentee are still within the term of protection as stipulated by law, and the infringer is still conducting patent rights infringement actions, judges in China generally make such a decision that the defendant shall stop its infringement actions, whereby the amount of compensation for loss due to such infringement actions shall be calculated for a maximum of two years from the date when the said litigation is submitted by the patentee to the People's Court retrospectively, and the loss due to said infringement actions conducted two years earlier shall not be protected.


6. Suspension of Patent Infringement Trial by the invalidation action file by alleged infringer. While investigating and examining cases of patent infringement actions regarding utility model patents and industrial design patents, once the accused infringer should have filed invalidation to the Patent Re-examination Board of the China Patent Office regarding the validity of the patent rights of the patentee, any court in China shall in general stop the on-going patent infringement litigation, and shall resume the said patent infringement litigation after a decision with respect to the validity of the patent of the patentee is made by the Patent Re-examination Board. But, any appeal that might be submitted by the accused infringer to announce that a patent is invalid should be proposed within the period of submission of defense, and if such appeal should be submitted after the said period of submission of defense, then the People's Court reserves the right not to stop the litigation. For invention patents, since the system of substantive examination is implemented in China, if the accused infringer should appeal to announce that an invention patent is invalid, then the People's Court may choose not to stop the litigation in general.

 

 

 

Source: http://www.chinaiprlaw.com/english/forum/forum4.htm



 

 

 

 

 

 

 

 

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