News• Apr 23, 2025
Notice on Issuing the "2025 Intellectual Property Administrative Protection Work Plan"
NationalIntellectualPropertyAdministrationIntellectualPropertyBureausofallprovinces,autonomousregions,municipalitiesdirectlyundertheCentralGovernment,andtheXinjiangProductionandConstructionCorps:The"2025IntellectualPropertyAdministrativeProtectionWorkPlan"(hereinafterreferredtoasthe"WorkPlan")isherebyissuedtoyou.Pleaseearnestlyimplementitinlightoflocalrealities.EachprovincialintellectualpropertybureaushouldcarefullyorganizeandimplementthetasksdeployedintheWorkPlan,andsubmitsemi-annualandannualworksummariesrespectivelybyJuly15,2025,andJanuary15,2026,throughthecomprehensiveofficesystem(OA)oftheNationalIntellectualPropertyAdministration.Electroniccopiesshouldbesimultaneouslysenttothecontactemailaddress.Thestatisticaltableofintellectualpropertylawenforcementguidancecasesshouldbesubmittedtogetherwiththesummary.NationalIntellectualPropertyAdministrationMarch17,2025ThisWorkPlanisformulatedtothoroughlyimplementtheimportantinstructionsanddirectivesofGeneralSecretaryXIJinpingoncomprehensivelystrengtheningintellectualpropertyprotectionwork,resolutelyimplementthedecision-makinganddeploymentoftheCentralCommitteeoftheCommunistPartyofChinaandtheStateCouncil,effectivelypromotetheimplementationofthe"OutlineforBuildinganIntellectualPropertyPower(2021-2035)",the"14thFive-YearPlanforIntellectualPropertyProtectionandUtilization",andthe"OpinionsonStrengtheningIntellectualPropertyProtection",furtherimprovetheintellectualpropertyprotectionsystem,strengthenthewhole-chainprotectionofintellectualproperty,andhelpcreateafirst-classbusinessenvironmentthatismarket-oriented,law-based,andinternationalized.I.PromotetheImplementationofLawsandRegulations.ImplementandpublicizethePatentLawanditsimplementingregulations.CooperatewiththerevisionoftheTrademarkLawandtheRegulationsontheProtectionofLayout-DesignsofIntegratedCircuits.Implementthe"MeasuresforAdministrativeAdjudicationandMediationofPatentDisputes",the"ProvisionsonRegulatingPatentApplicationBehaviors",the"ProvisionsontheRegistrationandAdministrationofCollectiveMarksandCertificationMarks",andthe"MeasuresfortheProtectionofGeographicalIndicationProducts".Implementlawenforcementnormssuchasthe"ProvisionsonEvidenceinTrademarkAdministrativeLawEnforcement",the"CalculationMethodfortheIllegalBusinessVolumeofTrademarkInfringementCases",andthe"ProvisionsonCaseCausesofIntellectualPropertyCasesintheMarketRegulationField(forTrialImplementation)".II.ImproveandOptimizetheProtectionSystem.Promotetheimplementationofthe"ImplementationPlanfortheIntellectualPropertyProtectionSystemConstructionProject",andstrengthentheconstructionoftheintellectualpropertyprotectionpolicyandstandardsystem,managementsystem,socialco-governancesystem,securitygovernancesystem,andsupportsystem.Conductanassessmentoftheimplementationoftheintellectualpropertyprotectionconstructionprojectinatimelymanner.Establisharegularcommunicationmechanismwithprivateenterprisesandforeign-fundedenterprises,listentotheiropinionsandsuggestionsonintellectualpropertyprotectioninatimelymanner,andrespondtotheirdemands.III.StandardizetheApplicationandUseofPatentsandTrademarks.Continuouslyandseverelycrackdownonabnormalpatentapplications,malicioustrademarkregistrations,andhoardingthroughmeasuressuchasimprovingmanagementsystems,carryingoutspecialcampaigns,guidingindustryself-discipline,andstrengtheningthesupervisionofagencyinstitutions.Strengthenprofessionalguidanceoninvestigatingandpunishingtheillegaluseofprohibitedtrademarksthataredeceptiveorhaveanadverseimpact.Fortrademarksthathavealreadybeenregistered,promptlyreportthemtotheNationalIntellectualPropertyAdministrationforexofficioinvalidationinaccordancewithprocedures,andintensifyfollow-uphandlingaftertheinvalidationdecisiontakeseffect.Promotetheimplementationofthe"TrialStandardsforGovernmentProcurementRequirementsforPatentandTrademarkAgencyServices".IV.StrengthenPatentProtection.Improvetheadministrativeadjudicationreviewandreportingmechanismformajorpatentinfringementdisputes.Strictlyreviewthefactsandevidencethatmeetthecase-filingconditions,andstandardizetheissuanceofsupportingmaterials.Promotethestandardizationofadministrativeadjudicationofpatentinfringementdisputes,smooththeacceptancechannels,optimizethetrialmodel,intensifycasehandlingefforts,andhighlightthequalityandefficiencyofcasehandling.Accuratelyidentifyinfringementfacts,strictlydetermineinfringementacts,andactivelyhandlesimplecasesquicklyandcomplexcasesmeticulously.Encouragelocalitiestofullyrelyonprofessionalforcessuchastechnologyinvestigationcenters,technologyinvestigatorexpertdatabases,andintellectualpropertyappraisalinstitutionstoprovidetechnicalsupportforcasehandling.V.StrengthenTrademarkProtection.Strengthenthetimely,key,andcitedprotectionofwell-knowntrademarks.Encouragelocalitiestostrengthentheprotectionoftime-honoredChinesebrandtrademarksandwell-knowntrademarksrelatedtotheinheritanceanddevelopmentofculturalheritagebycarryingoutspecialgovernancecampaignsandestablishingenterprisecreditevaluationsystems,andseverelycrackdownon"brand-aping"andotherinfringementacts.StrengthenthesupervisionandprofessionalguidanceonconcealedinfringementactsintheInternetfield,suchasinfringementthroughkeywords,combineduseofregisteredtrademarks,andusingdesignpatentstoinfringeonothers'priorregisteredtrademarks.VI.StrengthentheProtectionofGeographicalIndications.Implementthe"ImplementationPlanfortheUnifiedGeographicalIndicationRecognitionSystem",andorderlypromotethetransformationoforiginalagriculturalgeographicalindications.Promotetheconstructionofnationalgeographicalindicationprotectiondemonstrationzoneswithhighquality,andstrengthenthesupervisionduringtheimplementationofgeographicalindicationprotectionprojects.Conductanevaluationoftheimplementationofthe"14thFive-YearPlanfortheProtectionandUtilizationofGeographicalIndications".Encouragelocalitiestousemeanssuchasorigintraceabilitytoimprovethecharacteristicqualityassurancesystemforgeographicalindicationsandtheprofessionalinspectionandtestingsystemforgeographicalindications.Establishandimprovetheworksystemfortheapproval,cancellation,andsupervisionoftheuseofthespecialmarkforgeographicalindications,andstandardizetheuseofthespecialmark.VII.StrengthentheProtectioninNewFieldsandNewBusinessForms.Activelycooperatewiththeregistrationserviceofdataintellectualproperty,organizeandcarryoutpublicityandpromotion,policyinterpretation,andregistrationguidanceforthepublicinatimelymanner,andguideandencouragethepublictoactivelycarryoutregistration.Strengthenintellectualpropertyprotectioninthefieldofartificialintelligence,andpublicizeandimplementthe"TrialGuidelinesforPatentApplicationRelatedtoArtificialIntelligence".Increasetheintensityofintellectualpropertyprotectionforforward-lookingandstrategicemergingindustriessuchasnewenergyvehicles,lithium-ionbatteries,andphotovoltaics.Improvetheworkingmechanismincombinationwithindustryandregionalcharacteristics,strengthenthehandlingofcasessuchaspatentadministrativeadjudication,andprovidepreciseguidanceservices.VIII.StrengthenProtectioninPeople'sLivelihoodandHot-spotAreas.Focusonfieldsrelatedtopublicinterestsandthevitalinterestsofthepeople,suchasfoodandmedicine,rehabilitationaids,children'stoys,householdappliances,andgreenandlow-carbontechnologies.Increasetheintensityofdailysupervisionoverintellectualpropertyinfringementandillegalactsandadministrativelawenforcementguidanceontrademarksandpatents.Forareaswhereinfringementoccursfrequently,promptlycarryoutspecialgovernanceofintellectualproperty.Increasetheintensityofintellectualpropertyprotectionintheseedindustry,andstrengthenprofessionalguidanceoninvestigatingandpunishinginfringementactssuchascounterfeitingandbrand-faking.IX.StrengthenProtectionduringMajorEventsandKeyNodes.Doagoodjobintheintellectualpropertyprotectionoflarge-scaleeventssuchasthe9thAsianWinterGames,the12thWorldGames,andthe15thNationalGames.Severelycrackdownoninfringementactssuchascounterfeitingsportseventsouvenirsandculturalandcreativeproducts.Strengthentheintellectualpropertyprotectionoflarge-scaleexhibitionssuchastheChinaImportandExportFair,theChinaInternationalImportExpo,theChinaInternationalFairforTradeinServices,andtheChinaInternationalConsumerProductsExpo.Strengthenpre-exhibitioninspections,in-exhibitioninspections,andpost-exhibitionfollow-up,smooththecomplaintchannels,andquicklyhandleintellectualpropertydisputes.DoagoodjobinintellectualpropertyprotectionduringfestivalssuchasMayDay,theMid-AutumnFestival,andNationalDay.Strengthenthesupervisionofe-commerceplatforms,supermarkets,andprofessionalmarketstopreventthecirculationofcounterfeitandinfringinggoods.Conductriskinvestigationsandspecialrectificationsatthetimewhenseasonalgeographicalindicationproductsareintensivelylaunchedonthemarket,andstrictlyregulatetheillegaluseofgeographicalindications.X.StrengthenForeign-relatedIntellectualPropertyProtection.Promotetheestablishmentofaforeign-relatedintellectualpropertyprotectionworkingmechanismwithintheregion.Improvetheforeign-relatedintellectualpropertyprotectionservicesystem,handlevariouscasesfairlyandjustly,andequallyprotectthelegitimaterightsandinterestsofforeign-investedenterprises.Strengthentheconstructionoflocalsub-centersforoverseasintellectualpropertydisputeresponseguidance,withafocusonstrengtheningguidanceservicesforprivateenterprisesinoverseasdisputes.Improvetheoverseasriskearly-warningmechanism,strengthentheearly-warningmonitoringofdisputessuchas"Section337investigations",cross-bordere-commercelitigation,andmalicioustrademarksquatting,andenhancethetimelinessandinitiativeofservingenterprises.Strengthencoordinationandconnectionwiththecommercedepartment,andstrictlymanagetheexternaltransferofintellectualpropertyrightsintechnologyexportsinaccordancewiththelaw.XI.DeepenRapidandCollaborativeProtection.Furtherpromotethehigh-qualityworkofrapidandcollaborativeintellectualpropertyprotection,strengthentheoperationandmanagementofnational-levelintellectualpropertyprotectioncentersandrapidrightsprotectioncenters,reviewandverifythepre-filingentitiesandagencyinstitutionsforpatentpre-examination,andstrengthenthemanagementofpre-examinationqualityandpublicopinionmonitoring.Aggregatevariousintellectualpropertyresources,strengthendepartmentalcommunicationandcooperation,standardizeandsmooththeconnectionprocedures,andpromotetherapidhandlingofintellectualpropertydisputes.Encouragenational-levelintellectualpropertyprotectioncentersandrapidrightsprotectioncenterstoprovideassistanceortechnicalsupportforadministrativeadjudicationandadministrativemediation.Encouragenational-levelintellectualpropertyprotectioncenterstocarryoutmulti-modetrialsofpatentreexaminationandinvalidationcases,andpromotetheconnectionbetweenpatentrightconfirmationandadministrativeadjudicationandadministrativemediationofinfringementdisputes.Encouragenational-levelintellectualpropertyprotectioncenterstosetupworkstationsinareaswithconcentratedoriginalinnovation,suchasnationallaboratoriesandlarge-scalescientificfacilities.Establishanintellectualpropertypublicservicemechanisminscienceandtechnologyparksandindustrialparks,andsupportqualifiedintellectualpropertypublicserviceinstitutionstocarryoutinformationservicessuchasoverseasintellectualpropertyrightsprotectionandinfringementearly-warning.XII.StrengthenCross-departmentalandCross-regionalCollaboration.Strengthencooperationwithpeople'scourts,procuratorialorgans,andpublicsecurityorgans,establishalong-termliaisonmechanism,andpromotetheunificationofstandardsforadministrativeandjudicialprotectionofintellectualproperty.Deepencross-regionalintellectualpropertyadministrativeprotectioncooperationinregionssuchasBeijing-Tianjin-Hebei,theYangtzeRiverDelta,thePan-PearlRiverDelta,andChengdu-Chongqing.Dosolidanddetailedworkininformationsharing,jointevidencecollection,mutualrecognitionofresults,etc.,strengthenthefollow-uphandlingoftransferredclues,strengthenthecollaborativeprotectionofkeytrademarksandgeographicalindicationsandtheevaluationofprotectioneffects,andsolvenewproblemssuchas"concealed"infringementacrossregions.XIII.PromotetheResolutionofDisputesthroughSocialCo-governance.Strengthentheadministrativemediationofpatentownershipdisputes,inventionawardandremunerationdisputes,etc.,strengthencase-handlingguidanceandlinkage,andimprovethequalityandefficiencyofmediation.Strengthentheprofessionalconstructionofpeople'smediationorganizations.Strengthentheconstructionofthemediationteambysettingupfull-timemediatorsandestablishingexpertdatabases,etc.,andenhancetheprofessionalismandcredibilityofmediation.Promotetheonlineconnectionbetweenlitigationandmediationforintellectualpropertydisputes.Strengthenintellectualpropertydisputearbitration,andexpandtheuseofarbitrationchannelstoresolveintellectualpropertydisputes.Strengthentheconstructionofthecreditsysteminthefieldofintellectualproperty,andstrengthenthedishonestypunishmentfortrademarkandpatentinfringement,malicioustrademarksquatting,abnormalpatentapplications,etc.Givefullplaytotheroleoftypicalcasesofmultiplemediationofintellectualpropertydisputes,doagoodjobincaseselection,promotion,andrelease,andintensifytheexperienceexchangeandpromotion.XIV.StrengthenProfessionalLawEnforcementGuidance.Strengthenprofessionalguidanceonlawenforcementinthefieldofintellectualpropertytoeffectivelycrackdownonvariousinfringementandillegalacts.Standardizethecaserequesthandlingworksystem.Forrequestsforinstructionsondifficultcases,conductcasesituationresearchandlegalanalysisinatimelymannerandgivereplies.Strictlyimplementthewrittenreplyandfilingsystemforprovincialintellectualpropertymanagementdepartments.Increasetheintensityoffollow-uphandlingofrepliedcases,andimprovethequalityandefficiencyofcasehandling.Doagoodjobinthereviewofcasefiles.Strengthentheselectionandsubmissionofguidingcases.XV.PromoteIntelligentSupervisionandProtection.ContinuouslyexploretheapplicationofnewtechnologiessuchastheInternet,bigdata,cloudcomputing,andblockchaininintellectualpropertysupervision.PromotetheuseoftheNationalIntellectualPropertyProtectionInformationPlatform,supportlocalitiesinacceleratingtheconstructionofintellectualpropertypublicserviceplatformsandindependentlycontrollablespecialdatabases,andstrengthendatasharingandbusinesscollaboration.Steadilypromotetheimplementationofnationalstandardssuchasthe"SpecificationsforIntellectualPropertyProtectioninCommodityTradingMarkets"andthe"IntellectualPropertyProtectionManagementonE-commercePlatforms".Encourageregionswithconditionstousebigdatatechnologytocarryoutinfringementandillegalriskmonitoring,andachievereal-timemonitoringofcluesofinfringementandillegalactsone-commerceplatforms.XVI.StrengthenPublicityandTraining.Coordinatetraditionalandemergingmedia,makegooduseofconvergedmedia,andpublicizethemeasuresandachievementsofintellectualpropertyprotectionworkthroughmultiplechannels.MakefulluseofimportantopportunitiessuchastheNationalIntellectualPropertyPublicityWeektocarryoutcentralizedpublicity,releasetypicalcasesandexperience,andcreateagoodatmosphereforstrengtheningadministrativeprotection.Strengthenthepublicityandtrainingofnewlyissuedpoliciesandregulationssuchasthe"MeasuresforAdministrativeAdjudicationandMediationofPatentDisputes"andthe"ProvisionsonEvidenceinTrademarkAdministrativeLawEnforcement",andactivelycarryoutactivitiessuchasbusinesstraining,casediscussions,andskillscompetitionstoimprovetheadministrativeprotectioncapabilitiesofgrass-rootsintellectualpropertydepartments.XVII.StrengthenOrganizationalGuarantee.Eachprovincialintellectualpropertybureaushouldearnestlyorganizeandimplement,clarifythedivisionofresponsibilities,refineworkmeasures,andmaketargetedimprovementsinresponsetotheshortcomingsanddeficienciesinintellectualpropertyprotectioninthe2024centralquality,foodsafety,andintellectualpropertyprotectionassessment.Strengthensupervisionandguidance,commendunitsandindividualswhoareresponsiblefortheirworkandhaveoutstandingachievements,andcriticizethosewhereinfringementoccursfrequentlyandtheprotectioneffectisnotgood.Promptlyurgerectification,reportworkprogresstotheNationalIntellectualPropertyAdministrationasrequired,andseekinstructionsandreportsinatimelymannerforimportantmatters.NoticeonIssuingthe2025IntellectualPropertyAdministrativeProtectionWorkPlan(qq.com)(Source:ChinaNationalIntellectualPropertyAdministrationWeChat)
News• Sep 05, 2023
The Puzzle of the Deregistered Citation Owners
InChina'strademarkprosecutionpractice,trademarkapplicationsoftenfacerefusalsduetopriorcitedmarks.Somecitedmarksmaystillbevalid,eveniftheownershipofthesemarksareheldbycompaniesthatmaynolongerexist.Thissituationraisesacontroversialissue:Whetherthecitedmark,ownedbyaderegisteredowner,canaffecttheapplied-fortrademark?Therearetwoperspectivesonthisissue:1.Thefirstperspectivearguesthatthecitedmarkremainsvalid,regardlessoftheowner'sderegistration.Thus,thecitedmarkisanobstacletotheregistrationofthelaterapplied-fortrademark.2.Thesecondperspectivesuggeststhatthecitedmarkcancoexistwiththeapplied-formark,unlessitisassignedtoanewparty.WhileconsensushasnotbeenyetreachedbytheChinaNationalIntellectualPropertyAdministration(CNIPA)[2],previousprecedentsshowthatthemajorityofcasessupportthefirstperspective.TheCourtstakeacomprehensiveapproachandtendtosupportthesecondperspective.Courtsbasetheirdecisionsontheunderstandingthattrademarksaimtoprotecttheinterestsofconsumers,producers,anddealers.Ifatrademarkownernolongerexists,themarklosesitsabilitytoidentifythesourceofgoods/servicesandcannotpreventtheregistrationofalatertrademarkonthebasisofconfusingsimilarity.TheBeijingHighPeople'sCourthasexplicitlystatedthatifacitedtrademark'sownerisderegisteredwithoutevidenceofasuccessorentity,thecitedmarkmaybeconsidereddissimilartotheapplied-fortrademark.AsperArticle15.7oftheGuidelinesfortheTrialofTrademarkRightGrantingandVerificationCases[3],inadministrativetrademarkcases,iftheownerofacitedtrademarkisderegisteredandnoevidenceexiststoprovetheexistenceofasuccessorentity,thecitedmarkmaybedeemeddissimilartotheapplied-fortrademark.Ifthecitedmarkisassignedtoanewentityinthefuture,thenewownercanfileanoppositionorinvalidationasremedywithinthestipulatedperiodtoresolvetheconflictofrights.Incaseswheretheownerofthecitedmarkhasbeenderegistered,theauthorrecommendsthefollowing:1.Ifthecitedmarkisvulnerabletonon-usecancellation[4],theapplicantmayfileanon-usecancellationdirectly.Althoughprovidingevidenceofthederegistrationofthecitedmarkownermaydemonstratethatcoexistencewouldnotcreateconfusion,itismorecost-efficienttoaddresstheobstaclethroughnon-usecancellation. 2. Ifthecitedmarkhasbeenregisteredforlessthanthreeyearsand/orisnotvulnerabletonon-usecancellation,theapplicantshouldproceedwiththeRefusalReviewandsubmitevidenceincluding:a)informationfromtheNationalEnterpriseCreditInformationPublicitySystem;b)documentsfromtheStateAdministrationforMarketRegulationconfirmingderegistrationoftheownerofthecitedmark;c)evidencefromtheCNIPAshowingnotransferorlicensingtoathirdparty.Giventheabove,ifatrademarkregistrationisimportanttoyou,receivingarefusalbasedonapriorregisteredmarkmaynotdefeatyoucompletelyandtheauthorstronglyrecommendsthatapplicantsmaximizetheirinterestsbypursuingaRefusalReviewand/oradministrativelitigation.[1]ClosingabusinessinChinacanbecompletedthroughaderegistrationprocesswiththeStateAdministrationforMarketSupervision(SAMR)anditslocalbranches.Whilethederegistrationprocessmaybeacomplexone,thisarticleiswrittenonthepremisethatthederegistrationwascompletedcorrectly,andthecompanyisliquidated.[2]TheCNIPAisresponsiblefortheoperationalguidanceoftrademarkandpatentlawenforcement,formulatingandguidingtheimplementationoftrademarkrights,patentrightconfirmationandinfringementjudgmentstandards,formulatinginspection,identificationandotherrelevantstandardsfortrademarkandpatentlawenforcement,establishingmechanisms,anddoingagoodjobintheconvergenceofpolicystandardsandinformationnotification.[3]Theseguidelineswereissuedin2019bytheBeijingHighPeople’sCourttofacilitatethedeterminationoftheprotectionscopeoftrademarkrights,infringement,andtrademarkinfringementdefense.[4]Aregisteredtrademarkthathasceasedtobeusedforthreeconsecutiveyearsmaybevulnerabletoathirdparty’scancellationrequestbasedonnon-use.
News• Jun 27, 2021
Ways to Make Multiple Claim Amendments in Invalidation Actions and the Associated Risk
MasonXiKaiChenDavidHuangLexFieldLawOfficesInapatentinvalidationaction,thepatenteemaymakemultipleamendmentstothegrantedclaims.Amongtheamendments,somecouldbemorelikelytobeaccepted("safeamendments"),andsomemayhaveahigherriskofbeingrejected("riskyamendments").Atpresent,thereisnoclearproceduralruletospecifyhowtheotheramendmentsshouldbehandledwhenthepatenteesubmitsmultipleamendmentsbutoneormoreofthemaredeemedunacceptable.Thisposesasubstantialrisktothepatentee.Basedonacasestudyonthisissue,wehavethefollowingcommentsandrecommendations:(1)InpracticeCNIPA’sacceptanceorrejectionofamendmentsisessentiallytowardthe"fullset"ofalltheamendmentssubmittedbythepatentee,ratherthanindividualamendmentsorindividualclaims.Therefore,ifanamendmentisnotaccepted,itessentiallymeansthattheentiresetofamendmentswillnotbeaccepted.(2)Althoughthepatenteecansubmitamendmentsaftertheoralhearingbasedontheopinionstheexaminersgiveduringthehearingtoabandontheunacceptedamendmentsandretainonlytheacceptedamendments,theamendmentssubmittedatthislatertimingcouldberejectedonthegroundsthattheapplicabledeadlinehaslapsed.(3)CNIPAandthecourtshaveyetreachedaconsistentpositiononhowtotreatsuchamendmentssubmittedafteroralhearings,whichaggravatestherisksfacedbypatenteeswhoadopttheapproachmentionedin(2).(4)Asalternatives,apatenteecantrytosubmitamendmentsasearlyaspossible,seektheexaminer’sopinionsandthensubmitupdatedamendmentsbeforetheofficialdeadlinebasedontheexaminer'sfeedback,orsubmitmultiplesetsofamendmentsatatimeandthenselectonesetbasedontheexaminer'sfeedback.However,thereisnoguaranteethatthepatenteecaneventuallygetthedesiredresult.(5)ThereisanurgentneedforCNIPAtoclarifytheproceduralrulesforhandlingthissituationinthePatentExaminationGuidelines(“Guidelines”),soastoprovidebetterguidancefortherelevantparties.Belowarethedetaileddiscussionoftherelevantrules,casesandrisks.1.Thepracticalmanneroffilingclaimamendmentsrestrictspatentees’choicesUnderboththee-filingsystemandthetraditionalhard-copysystemofCNIPA,theonlymannerforapatenteetofileclaimamendsistofiletheentiresetofamendmentsintheformof"markuppages+replacementpages".Ifitisnecessarytoadjustthepreviousamendments(forexample,towithdrawsomeoftheamendments),thepatenteehastoresubmitacompletenewsetof"markuppages+replacementpages"fortheentiresetofclaims.Thepatenteecannotadjustasingleamendmentoramendmentstoasingleclaiminan“individualized&targeted”manner.Theabovemannerofsubmittingamendmentsisanimportantreasonthatrestrictstheflexibilitythepatenteehasinadjustingtheamendments.2.CNIPAandcourtshavedisagreementintheapplicationofrelevantrulesCNIPA(particularlyitsPatentReexaminationandInvalidationExaminationDepartment,"InvalidationDepartment")andcourtsinjudicialreviewhavedisagreementontherulesbywhichtodeterminewhetheraclaimamendmentshouldbeaccepted.Thisdisagreementisamajoruncertaintyapatenteefaceswhenconsideringamendmentstotheclaims.Article33ofthePatentLawstatesthatamendmentsshallnotgobeyondthe“originaldisclosures”ofthepatent.Article69oftheImplementingRegulationsofthePatentLawstipulatesthatamendmentsinaninvalidationaction“shallnotbroadenthescopeoftheoriginalpatent”.Basedonthesetwoarticles,intheGuidelinesCNIPAhasmadethefollowingmoredetailedrules(PartIV,Chapter3,Section4.6):Amendmentstoinventionorutilitymodelpatentsarelimitedtotheclaims.Theprinciplesare:(1)thesubjectnameoftheoriginalclaimshallnotbechanged,(2)comparedwiththegrantedclaims,theprotectionscopeoftheoriginalpatentshallnotbebroadened,(3)itshallnotexceedthescoperecordedintheoriginalspecificationandclaims,and(4)generally,technicalfeaturesnotincludedinthegrantedclaimsshallnotbeadded.Insatisfyingtheaboveprinciples,thespecificwaystoamendclaimsaregenerallylimitedtodeletionofaclaim,deletionofatechnicalsolution,furtherlimitationtoaclaim,andcorrectionofanobviouserror.Ascanbeseenfromtheabove,someofrulesintheGuidelineshavenoexplicitbasisinArticle33or69.TheInvalidationDepartmenthasfurtherdevelopedsomeinternalrulesinitspractice.Forexample,aftertheintroductionof"furtherlimitation"ruletotheGuidelinesin2017,alargenumberofcontroversialamendmentsemerged.Inviewofthis,thethenPatentReexaminationBoard(nowtheInvalidationDepartment)providedexplanationsontheliteralmeaning,contextandpurposeofthisrule,publishedarticles【1】andheldseminarsonit,allaimedtoprovidebetterguidancetopatentees.Toacertainextent,theseinternalrulesoftheInvalidationDepartmentalsolackanexplicitbasisinArticle33andArticle69.ThedifferencesbetweentheGuidelines(includingCNIPA’sinternalrules)andArticles33and69haveledtoinconsistenciesintheapplicationoflawbetweenCNIPA’sadministrativeactionsandthecourts’judicialreview.TheadministrativeactionsareusuallydirectlybasedontheGuidelinesandCNIPA’sinternalrules,whereasthejudicialreviewisinaccordanceonlywithArticle33andArticle69andthecourtstaketheGuidelinesandtheCNIPArulesonlyforreference.Injudicialpractice,somecaseshaveadoptedtheGuidelinesandtheCNIPArules,buttherewerealsocasesthatoverlookedorevenoverruledtheGuidelinesandtherules.Forexample,intheinvalidationactiononpatentZL200610113717.2case【2】,thecourtofthefirstinstanceadoptedtheGuidelinesandtheCNIPAinternalrules,includingarecognitionofthepositionthat"thescopeofprotectionoftheoriginalpatentshallnotbebroadened"shouldbejudgedbyreferringtotheoriginalscopeoftheveryclaimthatwasamended.However,theSupremePeople’sCourt,initssecondinstancejudgementNo.2020ZuiGaoFaZhiXingZhong246(“246Judgment”),specificallypointedoutthattheCNIPA’sGuidelinesandruleshavenolegaleffectonitsproceedings,andheldthat"thescopeoftheoriginalpatentshallnotbebroadened"shouldbejudgedwithreferencetothemaximumprotectionscopeoftheindependentclaimsoftheoriginalpatent.Thisarticledoesnotintendtoconductanin-depthsubstantiveanalysisoftheabove-mentioneddisagreementbetweenCNIPAandthecourts.Fromaproceduralpointofview,thisdisagreementundoubtedlyincreasesthedifficultyforthepatenteetoassesswhetheranamendmentwillbeacceptede,therebyincreasingthecomplexityofthepatentee'splanningofmultipleamendments.Whenconsideringmultipleamendments,thepatenteemayhaveoneclaimormultipleclaimsonmind.Indoingso,thepatenteemayneedtoconsider(1)thepossibilityfortheamendmentstobeaccepted,(2)infringementcomparisonwithexistingorhypotheticalinfringements,(3)impactonthestrengthoftheclaimstobeamended,and(4)thevaluetheclaimstobeamendedforenforcement.Thiscanbeacomplicateddecision-makingprocess.Therefore,whentherearebothsafeamendmentsandriskyamendmentsascandidatesforamendments(correspondingtofactor(1)),thepatenteeneedstoconsiderotherfactorsanddecidewhethertotaketheriskofpackagingthesafeamendmentswiththeriskyamendments,orjustputtingforwardsafeamendmentsonlyoutofcaution.The246JudgmentmadebytheSupremePeople’sCourtisthelatestexampleoftheinconsistencybetweenCNIPAandthecourts.Underthespiritofthisjudgment,alargenumberofcontroversialamendments,includingadditionofnewclaims,maybeconsideredacceptableunderArticle69.However,basedonourrecentexperienceandknowledge,theInvalidationDepartmenthasnotchangedinpracticetoacceptthosecontroversialamendmentsthatitpreviouslywouldrejectjustbecauseofthe246Judgment.Therefore,ifthepatenteereferstothe246Judgmentandfileriskyamendmentstogetherwithotheramendments,itmayresultinallamendmentsnotbeingacceptedbytheInvalidationDepartment,whichinturnmaycausethefollowingproblems.Thefirstproblemislossoftime.IftheInvalidationDepartmentrejectsalltheamendmentsandmakesitsdecisiontowardthegrantedclaims,importantclaimsamongthegrantedclaimscouldbeinvalidated.Inthiscase,ifthepatentisalsousedinaninfringementlawsuit,thentheinfringementlawsuitislikelytobedismissedorrequestedtobewithdrawn.Evenifthepatenteefinallyhastheriskyamendmentacceptedthroughjudicialreview,obtainsanewfavorableinvalidationdecision,andthenre-filestheinfringementlawsuit,alargeamountoftimehasbeenlost.ThesecondproblemispotentialriskrelatedtoArticle33ofthePatentLaw.The246JudgmentdidliberalizetheapplicationofArticle69,butthereareindicationsthatthecourtmaymeanwhiletightentheapplicationofArticle33.Inthissituation,someamendmentscouldstillbeheldasnewmatterbeyondthescopeoftheoriginaldisclosures,whichwouldstillreturntheclaimstobeexaminedtothegrantedclaims.Thissituationisessentiallyahidden,andthusriskier,"trap"forpatentees.3.RisksreflectedinactualcasesWesearchedforrelevantcasesandnoticedoneapproachthepatenteeshaveadoptedtoamendtheclaims:tofilebothsafeamendmentsandriskyamendmentsinafirstsubmission,andthen,iftheInvalidationDepartmentrefusestoaccepttheriskyamendments,tofileasecondsubmissiondeleting/withdrawingtheriskyamendmentsandonlyretainingthesafeamendments.Fromtheactualresults,however,thereisariskthatallamendmentsarerejectedunderthisapproach.Particularly,thereisanotableinconsistencyamongCNIPA,thefirst-instancecourtandthesecond-instancecourtonwhethertoacceptthesecondsubmissionandwhy.Thus,thecasestogetherfailtoprovideareliableguidanceforpatenteesinasimilarsituation.Case1:invalidationactiononpatentZL200920230829.5【3】ThepatenteesubmittedafirstsetofamendmentscontainingthreetypesofamendmentsA,B,andCwithinthespecifieddeadline(“Submission1”).Duringtheoralhearing,thecollegialpanelheldthatamendmentsoftypeAdidnotcomplywiththeGuidelineswhileamendmentsoftypesBandCwereincompliance.Aftertheoralhearing,thepatenteemadeanewsubmissioncontainingamendmentsoftypesBandConly(“Submission2”),essentiallywithdrawingamendmentsoftypeA.ThepanelheldthatalthoughtheactualtimingofSubmission2didnotcomplywiththeGuidelines,theamendmentsitcontainswerealreadyreflectedinSubmission1,andSubmission2thereforeshouldberegardedashavingactuallybeingsubmittedwithintheoriginaldeadline.ThepanelthenmadeitsdecisionbasedonSubmission2.ThecourtofthefirstinstanceheldthatSubmission1containedamendmentsoftypeAthatdidnotcomplywiththeGuidelinesandthereforeshouldnotbeaccepted,andthetimingofSubmission2didnotcomplywiththeGuidelines.Thecourtthenheldthatthecollegialpanel’sacceptingSubmission2basedonSubmission1whichitselfshouldnotbeacceptedwaswrong.Thecourtthusruledtorevoketheinvalidationdecision.Thecourtofthesecondinstanceheldbasicallythesamepositionasthatofthecollegialpanel.ItheldthattheamendmentsinSubmission2wereamendmentsoftypesBandCincludedinSubmission1,andthusSubmission2wasessentiallysubmittedwithintheapplicabledeadline.Thesecond-instancecourtthenruledtoupholdtheinvalidationdecision.Case2:invalidationactionofpatentZL200610113717.2【4】ThisisthecaseinwhichtheIntellectualPropertyDivisionoftheSupremePeople'sCourtmadetheabove-mentioned246Judgment.Thepatenteesubmittedwithinthespecifieddeadlinethefirstsubmissionrevisingthe48grantedclaimsinto272claims(“Submission1”).Duringtheoralhearing,thepatenteetriedtodelete196ofthe272claims,andaftertheoralhearing,submittedtherevisedtextcontainingtheremaining76claims(“Submission2”).ThecollegialpanelconsideredthatthefurtherdeletionsreflectedinSubmission2aredeletionofclaims,andthusSubmission2compliedwiththeGuidelinesregardingtimingfordeletions(whichcanbemadeanytimebeforetheInvalidationDepartmentissuesitsdecision).ThepanelthusmadetheinvalidationdecisionbasedonSubmission2.Case3:invalidationactiononpatentZL200480009662.X【5】Thepatenteesubmittedafirstsetofamendmentscontaining38claimswithinthespecifieddeadline,whichincludedfurtherlimitationstooriginalgrantedclaim1andnewindependentclaims16and28whichwereformedbyaddingdifferentfeaturestooriginalgrantedclaim1.Thecollegialpanelheldthattheadditionofnewindependentrights16and28didnotcomplywiththeGuidelines,andthusitdidnotacceptSubmission1butmadeitsdecisionbasedonthegrantedclaims.Inthefirstinstanceofjudicialreview,thepatenteearguedthatitattemptedtodeletethenewclaimsincludingindependentrights16and28duringtheoralhearing,andthatatleasttherevisedclaims1-15compliedwiththeGuidelinesandshouldbeaccept.Onthis,thecourtofthefirstinstanceheldthateveniftheaforementionedargumentfromthepatenteeweretrue,theamendedclaims1-15submittedduringtheoralhearingincludedamendmentsotherthandeletions,whichthushadexceededtheapplicabledeadlineandshouldnotbeaccepted.Theabovethreecasesallinvolveafirstsubmissionofamendmentsandasecondrevisedsubmissionformedbydeletingpartoftheamendmentsinthefirstsubmission.Itcanbeseenthatinallthethreecases,theInvalidationDepartmentandthecourtsregardedthesecondsubmissionasaseparateandnewlysubmitteddocument.Aquestiontheniswhetherthenewsubmissioncomplieswiththedeadlineandacceptable.Normally,theone-monthdeadlineforthepatenteetosubmitother-than-deletionamendmentshasgonebeforetheoralhearing.InCase1andCase2,thesecondsubmissionwasdeemedtomeetthedeadlineandshouldbeaccepted,buttheauthorities’specificreasonsfortheacceptanceweredifferent.InCase1thesecondsubmissionwasregardedashavingessentiallybeensubmittedwithintheoriginaldeadlineandthusacceptableevenifitcontainsamendmentsofthe"consolidation"manner.Incontrast,inCase2,thesecondsubmissionwasregardedas“furtherdeletions”ontopofthefirstsubmissionandthusitwasacceptedinlinewiththetimingrequirementforamendmentsofthe“deletion”manner(whichcanbesubmittedbeforetheinvalidationdecisionismade).Case2hasitsfurtheruniqueness.TheinvalidationdecisioninthiscasewasmadeduringtheexploratoryperiodafterCNIPAintroducedthe"furtherlimitation"ruletotheGuidelines.Ontheonehand,thecollegialpanellackedaclearlegalbasistodirectlyrejectthepatentee’sSubmission1ofdrasticallyincreasingthenumberoftheclaims.Ontheotherhand,likelyoutofthepurposeofreducingtheworkloadforall,thepanelhadthemotivationtoaskthepatenteetoreducethenumberofclaims.Therefore,thepanelfinallyacceptedSubmission2withsomeclaimsdeleted,possiblyasacompromisebetweenthesetwoconsiderations.However,thedifferenceinthereasonsfortheacceptanceofSubmission2inthefirstandsecondcasesstillshowsthatevenwithintheInvalidationDepartment,theremaynotbeaunifiedpracticeontheacceptance.InCase3,asaninferencefromtheresultofthecaseandthelanguageinthejudgmentbythefirst-instancecourt,theInvalidationDepartmentrefusedtoacceptSubmission2thepatenteeattemptedtosubmit.Inaddition,inbothCase1andCase3,thecourtofthefirstinstanceclearlypointedoutthatSubmission2didnotcomplywiththeGuidelinesonthedeadlineforclaimamendmentsandthereforeshouldnotbeaccepted.Basedontheabovecases,itcanbeseenthatifthepatenteefilesbothsafeamendmentsandriskyamendmentsinonesubmission,andthentriestodeletetheriskyamendmentsandretainonlythesafeamendmentswhentheInvalidationDepartmentrefusestoaccepttheriskyamendments,thereisriskthatallamendmentsareeventuallyrejected.4.PossiblealternativeshaveownuncertaintieswithnoguaranteeonresultsItcanbeseenfromtheabovecasesthatthekeyreasonfortheaboveriskisthatSubmission2wasfiledaftertheoriginaldeadlineforamendments.Thisisalsotheprimaryconsiderationinsearchforpossiblealternativesunderthecurrentrules.AfirstpossiblealternativeisthatthepatenteefilesSubmission1asearlyaspossiblewithintheoriginaldeadline,andthentrytoliaisewiththeexaminertofindoutwhetheralltheamendmentsareacceptable.Iftheexaminerhasanobjection,thepatenteemayconsiderfilingSubmission2stillwithinthedeadline.However,thisapproachhasitsownuncertainty:beforetheoralhearing,theexaminermaybeunwillingtoreviewthefileindepthandcommunicatewiththepatenteeonwhetheranamendmentmaybeaccepted.Anotherpossiblealternativeisthatthepatenteecanmaketwoorevenmoresubmissionsatthesametimewithinthedeadline,andmakeachoicebasedontheexaminer'sopinionsinthesubsequentproceedings.Thepatenteemaytrytocommunicatewiththeexaminerbeforetheoralhearing,orduringtheoralhearing,forthispurpose.However,first,asmentionedabove,theexaminermaynotbeinapositionforsuchacommunicationbeforetheoralhearing.Second,evenduringtheoralhearing,theexaminermayrefusetohaveadetaileddiscussiononthisissuebutcouldsimplyaskthepatenteetochooseoneofthesubmissionsasthebasisforexamination(theinvalidationrequesterislikelytopushtheexaminertoaskthepatenteeforachoicefirst).Undertheabovetwoalternatives,Submission2issubmittedwithinthespecifieddeadlineandthuscanavoidtheriskhighlightedinthe3caseswestudied.However,proceduraluncertaintiesassociatedwiththealternativesalsomeanthatinindividualcasesthereisnoguaranteeforthedesiredresult.5.CNIPA’srulesintheGuidelinesneedtoberevisedInsum,whenthepatenteemakesmultipleamendmentsinaninvalidationaction,itwouldfaceuncertaintiesandrisks,regardlessofwhetherthepatenteeadoptstheapproachreflectedinpreviouscasesorthealternativesweproposeabove.TheinconsistencyintheapplicationoflawbetweenCNIPAandthecourtsinvolvesbasicconceptsofthepatentlawandthebalancebetweenthepatenteeandthepublicinterest,andthusthetwoauthoritiesneedtonegotiateforappropriaterevisionstoArticle69andrelevantrulesintheGuidelines.Besidesthis,CNIPAcangreatlyreducetherisksfacedbypatenteesasshownintheabove3casesbyjustrevisingtherulesintheGuidelines.Forexample,CNIPAmayconsideroneorbothofthefollowingrules:(1)Itcanbemadeclear,intermsofthelegalstatus,thatSubmission2formedbywithdrawingcertainamendmentsinSubmission1accordingtothepatentee’sstatementsmadeduringtheoralhearingisnotafreshsubmission,butisarevisiontoSubmission1andthusshallstillenjoythefilingdateofSubmission1.(2)Inlinewiththebasicprinciplethataninvalidationactiononapatentistowardeachoftheclaimsofthepatentindividually,itcanbemadeclearthatthatthe“unit”oftheexaminationonwhetheramendmentsareacceptableistheindividualclaims,inthatevenifanamendmenttooneclaimisnotaccepted,itdoesnotaffectthestatusofamendmentstootherclaimsinthesamesubmission.Theimplementationofthisrule(2)mayrequireCNIPAtoalsoadjustitsITsystemsothatamendmentstodifferentclaimscanbemadeseparately,ratherthanbeingrestrictedbythecurrent"fullsetofclaims"manner.Webelievethatthesetworulesdonotaffectthebalanceofinterestsbetweenpatentees,invalidationrequestersandthepublic,nordotheycompromisethevalueofpublishedpatentdocumentsasa“publicnotice”onthescope/boundaryofpatentrights,butcanprovidethepatenteeswiththemuch-neededcertainty.[1]"UnderstandingandApplicationof"FurtherLimitationofClaims"",LiuMing,LiuYang.[2]Invalidationdecision:No.35611(madeinApril2018);Thejudgmentofthefirstinstance:(2018)Jing73XingChuNo.6316(madeinDecember2019);Second-instancejudgment:(2020)ZuiGaoFaZhiXingZhongNo.246(madeinDecember2020).[3]Invalidationdecision:No.24085(madeinSeptember2014);Judgmentoffirstinstance:(2014)JingZhiXingChuZiNo.71(madeinFebruary2017);Judgmentofsecondinstance:(2018)JingXingZhongNo.77(madeinApril2019).[4]Invalidationdecision:No.35611(madeinApril2018);Judgmentoffirstinstance:(2018)Jing73XingChuNo.6316(madeinDecember2019);Judgmentofsecondinstance:(2020)ZuiGaoFaZhiXingZhongNo.246(madeinDecember2020).[5]Invalidationdecision:No.34891(madeinJanuary2018);Judgmentoffirstinstance:(2018)Jing73XingChuNo.7914(madeinNovember2020)
News• Oct 12, 2020
Xiaomi v. IDC: First Suit over Global FRAND Rates before Chinese Courts
QishanZhao,ZheLu(LexfieldLawOffices)•OnJune9,2020,XiaomisuedIDCintheWuhanIntermediatePeople'sCourt,requestingthecourttodetermineglobalFRANDratesfortheSEPsinvolvedinthenegotiationbetweenthetwoparties.ThisisthefirstcaseoverglobalFRANDratesacceptedbyaChinesecourt.•OnJuly29,2020,afterlearningtheWuhanlawsuit,IDCfiledtwopatentinfringementactionsagainstXiaomibasedonitseightSEPsbeforetheDelhiHighCourtinIndia,applyingforpreliminaryandpermanentinjunctionsandrequestingtheIndiacourttodeterminetherelevantFRANDrates.•OnAugust4,2020,Xiaomifiledanapplicationofanti-suitinjunctionagainstIDCintheWuhancourtandthecourtgrantedtheinjunctiononSeptember23,2020.Thisisthesecondanti-suitinjunctionissuedbyaChinesecourtthisyearforSEPdisputesinvolvingparallellitigationsinanotherjurisdiction.•OnSeptember29,2020,afterlearningtheanti-suitinjunctionfromWuhan,IDCappliedtotheIndiacourtforananti-anti-suitinjunctionagainstXiaomi,whichwasgrantedonOctober9.BackgroundThenegotiationbetweenIDCandXiaomioverthelicenseofwirelesscommunicationsSEPsstartedin2015.InMay2017,IDCmadeaverbaloffertoXiaomiandthenonJune15,2019,IDCmadeawrittenoffertoXiaomicovering3G,4G,5G,802.11,andHEVCSEPsandprovidedtherelevantroyaltyrates.AsaresponseXiaomirequestedIDCtofurtherprovidetheratecalculationmethodologyandcomparablelicenses.OnJuly30,2019,XiaomimadeacounteroffertoIDC,whichwashoweverrejectedbyIDC.InFebruary2020,IDCmadeitssecondoffertoXiaomi,whichinXiaomi'sviewdidnotmateriallydifferfromtheoneIDCmadein2019.OnJune9,2020,XiaomisuedIDCbeforetheWuhanIntermediatePeople'sCourtandrequestedthecourttodeterminetheglobalFRANDrateoftheSEPportfoliosinvolvedinthenegotiation.LitigationProgressAfteracceptingthecase,theWuhancourtstartedtheserviceprocesstoIDC.OnJuly28,2020,XiaomiinformedIDCoftheChineseproceedings.Onthefollowingday,July29,IDCfiledtwopatentinfringementactionsbeforetheDelhiHighCourtagainstXiaomi.Inoneofthecases(CaseNo.CS.COMM.295/2020),IDCclaimedthatXiaomiinfringeditsfive3Gand4GSEPs(PatentNos.262910,295912,298719,313036,and320182);andintheotherone(CaseNo.CS.COMM.296/2020),IDCsuedXiaomiforinfringementofthreeSEPsrelevanttotheH.265orHEVCstandard(PatentNos.242248,299448,and308108).Inbothcases,IDCsoughtcompensatoryandpunitivedamages,aswellasa"FRANDinjunction"underwhichXiaomiwouldfaceaninjunctionfromtheIndiancourtwheninfringementisfoundedunlessitentersintoalicenseagreementontermsdeterminedasFRANDbytheIndiancourt.OnAugust4,2020,Xiaomifiledanapplicationforananti-suitinjunctionwiththeWuhancourt,withthefollowingclaimsforIDC's3Gand4GSEPsinvolvedintheWuhancase:(1)toorderIDCtoimmediatelywithdraworstaythepreliminaryandpermanentinjunctionsthatIDCappliedintheIndiancourtagainstXiaomi;(2)toenjoinIDCfromfilingforpreliminaryandpermanentinjunctionsinChinaorotherjurisdictions;(3)toenjoinIDCfromenforcinganyalreadyexistingorpossiblepreliminaryandpermanentinjunctionsinChinaorotherjurisdictions;(4)toenjoinIDCfromrequestingacourtinChinaorotherjurisdictionstoheardisputesbetweenthepartiesovertheroyaltyratesorroyalties;and(5)toenjoinIDCfrominitiatinganyformoflegalproceedingsinChinaorotherjurisdictions.XiaomiprovidedabondofRMB10millionfortheapplication.TheWuhancourtheldthat:(1)sinceIDCfiledalawsuitinIndiaandappliedforinjunctionsimmediatelyafterlearningabouttheWuhancase,IDC'sintentiontocircumventthisWuhancourt'sjurisdictionandtointerferewiththeadjudicationofthisWuhancaseisobvious;(2)IDC'sfilingoftheIndiancasesisanabuseofjudicialremedyproceduressinceinjunctionsbytheIndiancourtagainstXiaomi,ifissued,mightleadtoconflictswithdecisionsbythisWuhancourt;(3)IDC'sapplicationforpreliminaryandpermanentinjunctionsinIndiawouldnecessarilyaffectXiaomi'soperationsinIndiaandtherebysignificantlyharmXiaomi'sinterests;and(4)exceptadelayforIDCtopursuelegalprotectionofitsrightsafterthebreakdownofnegotiation,theissuanceofananti-suitinjunctionwouldnotcauseanyothermaterialinjurytoSEPsheldbyIDC,andnorwoulditaffectorharmthepublicinterests.OnSeptember23,2020,theWuhancourtruledthatIDCshallimmediatelywithdraworstaythepreliminaryandpermanentinjunctionsitsoughtintheIndiancourt.Besides,theWuhancourtruledthatwhilethecaseispendingbeforeit,IDCshallnot,basedonits3Gand4GSEPsinvolvedinthiscase,seekpreliminaryorpermanentinjunctionsagainstXiaomiinoroutofChina,enforcesuchinjunctionsthatitalreadyobtainedormightobtain,orrequireanothercourttodeterminetheFRANDroyalties.IfIDCdidnotcomplywiththeanti-suitinjunction,itwouldbefinedRMB1millionforeachdayofincompliance.IDCmayapplyforareconsiderationofthisruling,butitsenforcementwouldnotbestayedduringthereconsideration.FollowingtheIntellectualPropertyDivisionoftheSupremePeople’sCourt,thisisthesecondtimeforaChinesecourttoissueananti-suitinjunctionforaSEPdisputeinvolvingparallellitigationsinanotherjurisdiction.OnSeptember29,2020,afterlearningtheanti-suitinjunctionissuedbytheWuhancourt,IDCappliedforananti-anti-suitinjunctionintheDelhiHighCourtofIndia,seekingtoenjoinXiaomifromrestrainingIDC'spatentinfringementactionsinIndia.TheIndiacourtgrantedthisinjunctiononOctober9,2020,enjoiningXiaomifromenforcingtheanti-suitinjunctionissuedbytheWuhancourtwhiletheinfringementcasesinIndiaarepending.LitigationBattlebetweenIDCandLenovo&MotorolaInChina,IDCisalsoinSEPlitigationwithLenovoandMotorola.OnApril10,2020,LenovoandMotorolasuedIDCbeforetheBeijingIPCourt,requestingthecourttodeterminetheFRANDratespayableforIDC'sChinese3G,4G,and5GSEPs.ThecourtacceptedthecaseonJune16,2020.TheseriesofSEPactionsbetweenIDC,LenovoandMotorolafirstbeganintheU.K.OnAugust27,2019,IDCsuedLenovoandMotorolabeforetheHighCourtofJusticeinLondonforpatentinfringementandrequestedthecourttodeclarethattheglobalroyaltyratesthatIDCofferedwereFRANDrates,ortodeterminethetermsforaworldwidelicenseforits3Gand4Gpatentportfolios.IDCalsosoughta"FRANDinjunction"intheproceedings.ThefivepatentsindisputewereEP2363008,EP2557714,EP2485558,EP2421318,andEP3355537.MeanwhileintheU.S.,onAugust28,2019,IDCsuedLenovoandMotorolaintheU.S.DistrictCourtfortheDistrictofDelaware(the"DelawareDistrictCourt").IDCaccusedLenovoandMotorolaofinfringingitspatents,andrequestedthecourttodeclareitsofferdidnotbreachtheFRANDcommitments.Furthermore,IDCrequestedthatifLenovorefusedtonegotiateforagloballicense,enterintoaninternationalarbitration,oraccepttheFRANDtermsdeterminedbytheHighCourtintheU.K,theUScourtshouldissueaninjunction.The8patentsinvolvedinthepatentinfringementactionarepatentsNos8,085,665,8,199,726,8,427,954,8,619,747,8,675,612,8,797,873,9,203,580,and9,456,449.LenovoandMotorolachallengedthevalidityofthepatentsinthesuitandtheirmotiontodismiss6ofthe8patentsintheentiretywasdeniedbythecourtonJuly14,2020.OnApril9,2020,LenovoandMotorolaalsofiledananti-monopolysuitagainstIDCinthesameDelawareDistrictCourt,seekingrulingsthatIDCviolatedtheShermanActanditsFRANDcommitmentstoETSIwithitslicensingofthe3Gand4GSEPs.TheyalsorequestedthecourttodeterminethattheywereentitledtoaFRANDlicenseforIDC's3Gand4GSEPs,andtoenjoinIDCfromobtainingexcessiveroyaltiesfromthemortheircustomersforitsU.S.3Gand4GSEPsthroughpatentinfringementlitigation.
News• Sep 21, 2020
First Anti-Suit Injunction Granted by Chinese Court: Conversant Was Enjoined from Enforcing German Injunction
QishanZhao,ZheLu•OnAugust28,2020,theIntellectualPropertyDivisionofChina'sSupremePeople'sCourtissuedaninjunctionorderinHuaweiv.Conversantthatbeforeitrendersitsfinaljudgment,ConversantshallnotapplytoenforcetheDüsseldorfRegionalCourt’sinjunctionorderintheGermancasebetweenthetwoparties.•Thisisthefirstanti-suitinjunctionissuedbyaChinesecourtinaSEPdispute.•TheChineseinjunctionorderincludesapenaltyofRMB1millionperdayifConversantviolatestheorder.BackgroundConversantisanon-practicingentity(NPE)andacquiredapatentportfolioofabout2,000patentsandpatentapplications(includingSEPs),coveringabout40countriesandregions,fromNokiain2011.OnJuly24,2017,ConversantbroughtanactionagainstHuaweiandZTEbeforetheHighCourtofJusticeinLondon,allegingthetwodefendantsofinfringingits4UKpatentsandaskingthecourttodetermineglobalFRANDroyaltyratesfortheaboveglobalpatentportfolio[1].OnJanuary25,2018,HuaweibroughtthreeactionsbeforetheNanjingIntermediatePeople'sCourt,[2]applyingfornon-infringementdeclarationtowardthreeChineseSEPsownedbyConversantandadeterminationofFRANDterms(includingroyaltyrates)fortheChinesemarkettowardallChineseSEPsownedbyConversant.OnSeptember16,2019,theNanjingcourtissuedthefirst-instancejudgmentanddismissedHuawei’srequestforanon-infringementdeclarationonthegroundsthattheassertedpatents(ZL00819208.1,ZL200580038621.8andZL200680014086.7)hadallbeeninvalidated.Since8ofthefifteenChineseSEPs[3]heldbyConversanthadalreadybeendeclaredinvalidinprioradministrativeproceedings,thecourtassessedtheessentialityoftheremaining7SEPsanddecidedthatonlyonepatent(ZL200380102135.9)wasessentialto4Gtechnologiesunderrelevant3GPPstandards.ThecourtthusruledthatHuaweianditsChineseaffiliatesonlyneededtopayroyaltiesforthe4Gmobileterminalproductsforthatpatent,withtherateofsingle-mode4Gmobileterminalproductsbeing0.00225%andtherateofmulti-modeproductsbeing0.0018%inChina[4].Conversantappealedthefirst-instancejudgmenttotheSPCIPDivision[5]andthetwopartiesareawaitingforthesecond-instancejudgment.OnApril20,2018,ConversantsuedHuaweiforpatentinfringementinthreecasesbeforetheDüsseldorfRegionalCourtinGermany,involvingpatentsEP1797659[6],EP1173986[7],andEP1878117[8](ConversantalsosuedZTEinthreeothercasesbasedonthesamepatents).OnAugust27,2020,theDüsseldorfcourthandeddownthefirst-instancejudgmentsintheactionsinvolvingEP1797659.InthecaseagainstHuawei,thecourtfoundHuaweitobeanunwillinglicenseeandthusrenderedaninjunctionorderprohibitingHuaweianditsGermanaffiliatesfromproviding,selling,usingor,forsuchpurposes,importingorpossessingrelevantmobiledevices,andprohibitingHuaweifromsupplyingordeliveringUMTS-compliantmobilephonesandtabletstocustomers.ThecourtalsoruledthatHuaweishallrevealinformationabouttheinfringingactsandsales,destroyandrecalltheinfringingproducts,andbearthecostoflitigation.[9]Conversantcanenforcetheinjunctionontheconditionthatitprovideabondof2.4millioneuros.HuaweiappliedforbehaviorpreservationtotheSPCIPDivisionatthesamedaytheDüsseldorfRegionalCourtissueditsdecision,seekinganorderprohibitingConversantfromenforcingtheDüsseldorfdecisionbeforeSPCIPDivisionissuesitsfinaljudgmentintheChineseaction.HuaweialsoprovidedabondofRMB19.7millionfortheapplication.OnAugust28,theSPCIPDivisionissuedarulinggrantingHuawei’sapplication,whichisthefirstanti-suitinjunctionthatChinesecourtshaveissuedinSEPcasesthatinvolveparallelproceedingsinotherjurisdictions.FactorsSPCIPDivisionConsidersinGrantinganAnti-SuitInjunctionThemainlegalbasisfortheanti-suitinjunctiongrantedbySPCIPDivisionisArticle100ofChina’sCivilProceduresLawprovidingforbehaviorpreservation:“Whentheenforcementofajudgmentmaybedifficultorotherdamagesmaybecausedduetotheconductofonepartyorforotherreasons,thePeople'sCourtmay,upontheapplicationoftheotherparty,ruletopreserveitsproperty,orderittoperformcertainactsorprohibititfromperformingcertainacts;iftheotherpartydoesnotmakeanapplication,thePeople'sCourtmayalsoruletotakepreservationmeasureswhennecessary.ThePeople'sCourt,inadoptingprotectivemeasures,mayordertheapplicanttoprovidesecurity,andmayrejecttheapplicationiftheapplicantfailstoprovidethesecurity.Uponacceptingtheapplication,thePeople'sCourtmustmakearulingwithin48hoursifthesituationisurgent;ifitrulesthatprotectivemeasuresshouldbetaken,itshallimmediatelybegintheenforcement.”TheCivilProceduresLawdoesnotprovideforspecificsregardingbehaviorpreservationagainsttheenforcementofaforeigncourtjudgmentasHuaweiappliedfor.TheSPCIPDivisionidentifiedandanalyzed5factorsindecidingwhethertograntsuchabehavior-preservationapplication(i.e.ananti-suitinjunction).1.InfluenceofEnforcementofForeignCourtDecisionsonChineseProceedingsTheSPCIPDivisionheldthatindeterminingwhethertograntananti-suitinjunction,thecourtshouldfirstexaminewhethertheenforcementofaforeigncourtdecisionwouldhaveasubstantialeffectonthetrial,adjudicationandenforcementoftheparallelproceedingsinChina.Thecourtmayissueananti-suitinjunctionifitfindsthattherespondent’srelevantbehaviormighthinderthetrialoftheparallellitigationinChinaormakeitdifficulttoenforcetherelevantChinesejudgments.Inthiscase,theSPCIPDivisionheldthat:(1)thepartiesintheDüsseldorfjudgmentandtheChinesecaseswerebasicallythesame;(2)theissuespartiallyoverlappedinthetwocasesnotwithstandingsomedifferences;and(3)intermsofresults,ifConversantappliedtoandwasallowedtoenforcetheinjunctiondecisionbytheDüsseldorfRegionalCourt,thethreeSEPcasesnowbeingheardbytheSPCIPDivisionwouldbeinterferedanditssecond-instanceproceedingswouldevenbecomemeaningless.2.NecessityofanAnti-SuitInjunctionTheSPCIPDivisionheldthattheexaminationofthenecessityofissuingananti-suitinjunctionshouldfocusonwhethertherewouldbeanyirreparableharmtobesufferedbytheapplicantordifficultyinenforcingChinesecourt’sdecisionintheabsenceofananti-suitinjunction.Inprinciple,aChinesecourtshouldissueananti-suitinjunctiononlywhenitistrulynecessary.Inthiscase,theSPCIPDivisionheldthatifConversantfiledanapplicationandmanagedtoenforcetheinjunctioninGermany,HuaweiwouldeitherhavetowithdrawfromtheGermanmarketorbeforcedtoacceptthelicensetermsConversantoffered,whichwere18.3timestheroyaltyrateasdeterminedbytheChinesecourtinthefirstinstance.HuaweiwouldthusbeforcedtogiveupremediesitmighthaveunderChineselawsandsufferirreparableharm.Therefore,ananti-suitinjunctionwasnecessaryandurgentinthisparticularcase.3.BalanceofInterestsbetweentheTwoPartiesTheSPCIPDivisionheldthatindeterminingwhethertograntananti-suitinjunction,thecourtshouldalsoconsiderthebalanceofinterestsofbothpartiesandweightheharmstheapplicantmightsufferintheabsenceofananti-suitinjunctionandtheharmstherespondentmightsufferasaresultofananti-suitinjunction.Inthiscase,thecourtheldthatHuaweiwouldbeforcedtowithdrawfromtheGermanmarketortoacceptConversant’slicenseofferandgiveupremediesitmighthaveunderChineselawsintheabsenceofananti-suitinjunction.However,ifananti-suitinjunctionwasimposed,thecourtheld,thedamagesthatConversantmightsufferwouldbelimitedtoastayofenforcementoftheDüsseldorfcourt’sdecision,whichwasnotthefinaljudgment.Moreover,Conversant’sotherrightsandinterestsintheGermanlitigationwouldnotbeaffectedbythestay,andsinceConversant’scentraldemandwasmonetarycompensation,thelossitmightsufferfromsuchastaywouldbelimited.Inthemeantime,Conversant’sinterestscouldbeadequatelyremediedbythebondHuaweiprovidedfortheanti-suitinjunction.4.HarmtoPublicInterestsTheSPCIPDivisionheldthatindeterminingwhethertograntananti-suitinjunction,thecourtshouldfurtherconsiderwhetherthepublicinterestswouldbedisservedbytheinjunction.Inthiscase,thecourtfoundnoadverseimpactonthepublicinterestsfromtheanti-suitinjunction.5.ConformitytoPrincipleofInternationalComityThelastfactorthattheSPCIPDivisionconsiderediswhetherananti-suitinjunctionwouldbeinlinewiththeprincipleofinternationalcomity.Inthisregard,SPCIPDivisionheldthatthefollowingfactorsshouldbeexamined:thetemporalorderbywhichthecaseswerefiled,whethercourtshavetheappropriatejurisdiction,andwhethertheimpactananti-suitinjunctionwouldhaveonthetrialandadjudicationofforeigncasesisproportionate.Inthiscase,theSPCIPDivisionheldthat(1)theChinesecaseswerefiledearlierthantheGermancasesand(2)theimpactoftheanti-suitinjunctionontheGermancasewasproportionatesincetheconsequencewaslimitedtothestayofenforcementofthefirst-instanceinjunctionorder,whiletheGermancourt’ssubsequentproceedingswouldnotbeaffectedandlegaleffectoftheGermanjudgmentwouldnotbediminished.ConsequenceofRefusaltoComplywithanAnti-SuitInjunctionMoreover,giventheemergency,theSPCIPDivision,accordingtoArticle100oftheCivilProceduresLaw,issuedtheanti-suitinjunctionwithin48hours,withoutapriorhearingandwithanimmediateenforcementofit.Conversantmayapplyforareconsiderationoftheanti-suitinjunction,butitsenforcementwouldnotbestayedduringthereconsideration.Also,accordingtosubparagraph6,paragraph1ofArticle111(regardingconsequencesofrefusaltocomplywithaneffectivecourtjudgmentorruling)andparagraph1ofArticle115(regardingfinesbetweenRMB50,000and1,000,000thatmaybeimposedonlegalentities),thecourtruledthatifConversantdidnotcomplywiththeanti-suitinjunction,itwouldbefinedRMB1millionforeachdayofincompliance.Chinesecourtsrarelysetapenaltyforrefusaltocomplywithbehaviorpreservationorders.ThisisalsothefirsttimefortheSPCtorulethatfinesunderthefirstparagraphofArticle115ofCivilProceduresLawcanbeaccruedonadailybasis.-------------------------------------------------------------------------------------------------------------------------------------------------------[1]AfterConversantfiledthepatentinfringementcaseagainstHuaweiandZTEbeforetheHighCourtofJusticeinLondon,HuaweiandZTEchallengedthecourt’sjurisdictiontodeterminetheglobalroyaltyratesforthepatentportfolioindispute.OnApril16,2018,theHighCourtofJusticedismissedthechallengeofjurisdiction,whichwasappealedbyHuaweiandZTEafterwards.OnJanuary30,2019,theCourtofAppealdismissedtheappeal.ThenthecasewasappealedtotheUKSupremeCourt,andonAugust26,2020,UKSupremeCourtdismissedtheappeals.[2]TheNanjingIntermediateCourtacceptedthecasesatthedateoffilingandthedocketnumbersofthethreecasesarerespectively(2018)Su01MinChuNo.232,(2018)Su01MinChuNo.233,and(2018)Su01MinChuNo.234.[3]The15patentsfallinto10families,ofwhich11patentsin10familieswereheldbyConversantbeforeHuaweifiledthecasesbeforeNanjingIntermediateCourt,andanotherfourpatentsinfourfamiliesweretransferredtoConversantamidthecourtproceedingandthenaddedintothetrialwithconsentofbothparties.[4]Fordetailsofthejudgment,seeLuZhe,ZhaoQishan,Huaweiv.Conversant:SettingtheFRANDRatesforSEPsinChineseMarket,https://new.lexfieldlaw.com/static/?c=n&a=Publication_detail&myid=8&id=118,lastvisitedonSeptember16,2020.[5]TheSPCIPDivisionacceptedthethreeappealsonNovember18,2019.Thedocketnumbersarerespectively(2019)ZuiGaoFaZhiMinZhongNo.732,(2019)ZuiGaoFaZhiMinZhongNo.733,and(2019)ZuiGaoFaZhiMinZhongNo.734.[6]ThedocketnumberoftheGermancaseagainstHuaweiis4bO30/18.TheChinesepatentofthesamefamily,ZL200580038621.8,hasbeendeclaredinvalidinadministrativeinvalidationproceedingsandtherelevantadministrativelitigationproceedingisnowinthefirsttrail.[7]ThedocketnumberoftheGermancaseagainstHuaweiis4bO48/18.TheChinesepatentofthesamefamily,ZL00804203.9,hasbeendeclaredvalidinadministrativeinvalidationproceedingsbutwasheldasnon-essentialtorelevantstandardbyNanjingIntermediateCourt.[8]ThedocketnumberoftheGermancaseagainstHuaweiis4bO49/18.TheChinesepatentofthesamefamily,ZL200680014086.7,hasbeendeclaredinvalidinadministrativeinvalidationproceedings.[9]Inaddition,DüsseldorfRegionalCourtalsorenderedfirst-instancedecisionsinthecasesinvolvingEP1173986wherethedefendantswerefoundtohaveinfringedthedisputedpatentbutnoinjunctivereliefwasgrantedduetotheexpirationofthepatent.
