NTD INTELLECTUAL PROPERTY 4.26 Special Report Issue No.3 2014.05 2014.05.20 On April 26, 2014, the 14th World Intellectual Property Day, the Supreme People's Court, local courts and the Supreme People's Procuratorate all issued IP Typical Cases in 2013, which collectively showed the latest progress of judicial protection of intellectual property in China, summarized the IP judicial experience in China, and provided a lot of fresh material for case study. This current issue of IP Case Express summarizes and reviews 150 IP Cases to share with you, including the Top 10 Cases, the Top 10 Innovation Cases of the Supreme Court, the Top 50 Classic Cases the Supreme Court announced, the Top 10 IP Cases the Supreme Procuratorate released, and the Top 10 IP Cases issued by Beijing (including Top 10 IP Cases and Top 10 Innovation Cases), Shanghai, Jiangsu, Zhejiang and Guangdong High Courts as well as Shenzhen Intermediate People's Court, where IP cases are concentrated. As pointed out in Intellectual Property Cases Annual Report by the Supreme Court, in 2013, the Supreme Court IP Tribunal accepted 594 intellectual property-related cases, 65.46% more than last year, and concluded 548 IP-related cases. The number of IP cases tried by the Supreme Court in 2013 was the highest number of cases heard by the Court since 2009, and set a new record for a year. The number of technology cases, such as Patent, increased sharply. The legal issues involved insightfully hit basic systems and concepts of patent law and the facts involving technology were more up front and complex, while the market value and interests were gigantic. The number of patent administrative cases is growing rapidly and the proportion of essential patent cases in the fields of medicine, electronics, and communications is increasing as well. There are more patent civil cases in respect to infringement determination rules and the number of new plant varieties NTD PATENT & TRADEMARK AGENCY LIMITED NTD LAW OFFICE 10th Floor, Block A, Investment Plaza, 27 Jinrongdajie, Beijing 100033,P.R. China Tel: 86-10-66211836 Fax: 86-10-66211845 E-mail: [email protected] Website: www.chinantd.com １ ©NTD Intellectual Property NTD PATENT & TRADEMARK AGENCY LTD. NTD LAW OFFICE 4.26 Special Report Issue No. 3 2014.05 cases has had a high-speed growth. The number of trademark cases is declining as a whole, and while trademark civil cases are basically stable, trademark administrative cases are increasing, and the proportion of cases involving trademark squatting is large. As correlative cases relating to copyright become more,cases regarding cultural creative industries, such as software, animation, practical art continue to increase. The proportion of competition cases in respect to network technology and new business models is big. Cases regarding trade secrets and counterfeiting continue to increase. It is also the first time the Supreme Court has heard a monopoly case. From the regional distribution of 70 cases the Supreme Court issued, on the one hand, the regional concentration of these typical cases are relatively high, in which most of the cases are issued by the Supreme Court, accounting for 30%. The Top 3 local courts are Beijing, Guangdong, Jiangsu, accounting for 28.6%. Though only three cases from Shanghai courts were selected, the importance of the selected cases is very high, one was selected in the Top 10 Cases and the other two in the Top 10 Innovative Cases. It is evident that the Supreme Court recognized the IP trial level of the above four local courts. On the other hand, these typical cases are widely distributed. There are cases from a total of 21 local courts at the provincial level selected into the Supreme Court Cases, to some extent, which reflects the improvement of the overall IP trial level in China. Please refer to the statistics as below: Regional Distribution of 70 Cases issued by the Supreme Court - 2 - ©NTD Intellectual Property NTD PATENT & TRADEMARK AGENCY LTD. NTD LAW OFFICE 4.26 Special Report Issue No. 3 2014.05 Statistics on Typical Cases issued by the Supreme Court and Local High Courts1 (Based on the Object) Type The Supreme Beijing Shanghai Jiangsu Zhejiang Guangdong Shenzhen Court High High High High High Intermediate Top 10 Court Court Court Court Court Court Top 10 Innovation Top 10 Top 50 Classic Top 10 Innovation Patent 17 4 0 1 3 1 0 Trademark 21 8 4 3 3 5 3 Copyright 12 4 2 2 1 1 2 （4 Cases （2 Cases （1 case （1 Case (2 Cases regarding regarding regarding regarding regarding Information Information Information software Information Network Network Network copyright） Network Distribution Distribution Distribution Distribution Right） Right） Right） Right） Plant 2 0 0 1 0 0 0 Variety Unfair 8 2 2 2 2 1 3 Competition （5 cases regarding (2 cases (1 criminal and (2 criminal (1 criminal (1 criminal trade secrets） regarding civil case cases regarding case regarding case regarding trade secrets） regarding trade secret) trade secret) trade secret) technical secret;1 civil case regarding trade secrets) Monopoly 2 0 1 0 0 0 0 Contract 5 1 1 0 0 1 1 Others 3 1 1 1 1 1 (1 criminal case on (copyright (Customs (Customs (Royalty Fee (Administrative producing and pre-suit Administrative Administrative of Standard Handling selling injunction) Enforcement） Enforcement) Essential regarding counterfeited Patent) Trademark products, Infringement) 1 case regarding 1For case in respect to trademark and unfair competition, it is classified into trademark case. - 3 - ©NTD Intellectual Property NTD PATENT & TRADEMARK AGENCY LTD. NTD LAW OFFICE 4.26 Special Report Issue No. 3 2014.05 Copyright Pre-suit Injunction; 1 case regarding Royalty Fee of Standard Essential Patent) From the cases issued by the Supreme Court and local courts, the following several new trends are worth paying close attention to: 1. The proportion of copyright infringement cases related to software and the right of information network distribution is remarkably increasing and most of the copyright cases announced by the five local courts are related to those two areas. In fact, it is also reflected in the area of administration. For example, in the Top 10 Cases regarding cracking down on piracy published by National Copyright Administration in 2013, 5 cases were related to copyright and information network distribution infringement. The key issues in the published cases include jurisdiction of infringement act, the determination of nature and responsibility of using copyright by an operator under the condition of innovation of network business mode, and the defense of fair use, which embodies the new thought of courts to deal with copyright infringement in the age of the Internet. 2. Since the implementation of the new Civil Procedure Law in 2013, cases of pre-suit preservation of act in the field of IP sprung up, among which, 2 of the cases Beijing High Court released involved a preliminary injunction, i.e. "Qian Zhongshu Letters Manuscript Auction" case and "Abbott Milk Powder Cans" case (the first one involving a design patent right), which has received widespread attention. While in the "Eli Lilly and Company Trade Secret Infringement" case, Shanghai High Court granted a preliminary injunction in the infringement lawsuit regarding trade secrets for the first time. The above cases involve copyright, patent and business secrets. Among these cases, "Qianzhongshu letter case" was selected in the Top 10 IP Cases of the Supreme Court, “Abbott Milk Powder Cans case” was published by the Supreme Court in April, 2014 as one of the five guiding cases in the third monthly released People’s Court Cases and "Lilly case" was selected in the Top 10 Innovative Cases of the Supreme Court. It is predictable that a preliminary injunction is likely to be widely used in the future, as long as the IP infringement cases conform to Article 100 of the Civil Procedural Law. 3. Since the Anti-monopoly Law was promulgated in 2008, antitrust cases have been amongst the most popular in the past five years. Among them, the Johnson & Johnson vertical monopoly agreement dispute cases tried by Shanghai High Court were selected in the Top 10 Innovative Cases of the Supreme Court. Huawei vs. IDC, a case tried by Guangdong High Court, regarding abuse of a dominant market position, obtained high exposure and generated an extraterritorial influence. In addition, the first court session for a monopoly case, by the - 4 - ©NTD Intellectual Property NTD PATENT & TRADEMARK AGENCY LTD. NTD LAW OFFICE 4.26 Special Report Issue No. 3 2014.05 Supreme Court in November 2013, received widespread attention, which has not been pronounced so far. This monopoly case is the appeal filed by Beijing Qihoo Technology Co., Ltd against Tencent Technology (Shenzhen) Co., Ltd. and Shenzhen Tencent Computer Systems Co., Ltd. for dissatisfaction with the first-instance judgment awarded by Guangdong High Court. NSSC Case represented by NTD Selected into Top 10 Cases of Beijing Court and Top 50 Classic Cases of the Supreme Court It is worth noticing that one case represented by NTD has been selected into the typical case collection of both the Top 10 IP Cases of Beijing Court in 2013 and the Top 50 Classic IP Cases of China issued by the Supreme Court (only four patent administrative litigations were selected). The patent involved in the case of NSSC vs. Patent Reexamination Board and Li Jianxin on Patent Invalidation Decision (Beijing High Court Administrative Judgment (2013) Gao Xing Zhong Zi No.1754) was first invalidated in Patent Reexamination Board, then the decision was upheld by the court of first instance and finally overturned by the court of the second instance, which supports the claim of the patentee.