On April 21, 2016, the Supreme People’s Court selected 10 of the most representative civil, administrative and criminal cases involving intellectual property rights in 2015 to briefly summarize their specifics and analyze the significance of each case. The determination standard in each case will be instructive to similar cases in the future.
The first and second cases both involved design patent infringement; no infringement was found in one case, and infringement was found in the other. The third representative case clarified whether an electronic commerce platform may be held jointly and severally liable; the fourth case involved unfair competition through trademark infringement; the fifth case dealt with earlier use of a trademark; the sixth case pertained to licensed use of a trademark; the seventh involved copyright infringement; the eight dealt with preliminary injunction; the ninth is a an administrative action over intellectual property rights; and the tenth case pertained to criminal fraudulent trademark registration. In addition to the above ten representative intellectual property rights cases, the Supreme People’s Court also mentioned 50 classical cases in the appendix at the end to serve as reference for people’s courts when hearing intellectual property rights cases in the future. Details for the key cases are as below:
1. Declaratory action on non-infringement of HondaÕs design patent and damages: In 2003, Honda issued a warning letter to and filed a patent infringement suit against Shuang Huan Co., Ltd. for alleged infringement of Honda’s design patent on the appearance of its automobiles. Shuang Huan subsequently brought a declaratory action at the Shijiazhuang Intermediate People’s Court to confirm that the cars it manufactured and sold did not infringe on the subject patent, and it also applied to the Board of Patent Appeals and Interferences to invalidate that patent. After the Board of Patent Appeals and Interferences rendered an administrative decision that the patent was invalid, Shuang Huan added a claim for damages in its declaratory action. During the 12-year trial, in addition to the review over whether the patent is valid, the parties also focused on the nature of the warning letter. In this case, the court discussed whether a warning letter is a proper exercise of protection of rights or an act of unfair competition, and how damages should be examined; the court held that the legality of issuing the warning letter, its connections with fair competition, and the commercial risks of market participants should all be considered. Cases in the future may refer back to the standards laid out in this case.
2. Infringement of a design patent for “hand-held shower heads”: The main disputes in this case were the design features and functional features of the patent. With respect to a design patent, the Supreme People’s Court held that if the alleged infringing design does not include the patented design and may be distinguished from all design features in the current design, it can generally be presumed that the accused infringing design bears no similarity with the patented design. The retrial decision made a detailed explanation over the meaning, categorization and determination of design features and functional features of a design patent, which may serve as a ruling standard for determining design patent infringement cases in the future.
3. Joint and several liability for e-commerce platforms: This case primarily pertained to an e-commerce operatorÕs liabilities for infringement. The issue was whether Tmall Co. should be held jointly and severally liable for its failure to take necessary measures after receiving complaints about Jinshidi Co. selling products that are infringing on patents held by Chiayikao Co. but nevertheless continued to allow sales on its platform. In the second instance decision, it was held that communicating the contents of the complaint to the party subject to the complaint is one of the “necessary measures” under the Tort Law. Therefore, Tmall Co.’s failure to communicate such complaints meant Tmall did not take the necessary measures. This case not only affirmed that e-commerce platforms have a duty to “notify”, but also considered preventing rights holders from abusing the complaint mechanisms in order to balance the interest of both parties.
4. Non-infringing earlier use: This case primarily dealt with the application of Article 59, Paragraph 3 of the Trademark Law. Qihang Examination School was established in 1998, while Qihang Co. was established in 2003. Before Qihang English Training School obtained the Class 41 registered trademark “Qihang School” for school (educational) services, Qihang Examination School had used wording such as “Qihang Examination Research” in its publications. The court made a full analysis and summary of the criteria for applying Article 59, Paragraph 3 of the Trademark Law and expounded in detail the timeframe for earlier use, finding that there was a certain degree of influence and the original scope before finally concluding that Qihang Examination School and Qihang Co. did not infringe on the exclusive rights to the registered trademark.
5. The case involving Yao Chung’s lawsuit against Zheng Yu: From the beginning, this case attracted a lot of attention in the public; at the end, the Beijing High People’s Court affirmed the first-instance decision, holding that Zheng Yu and others had infringed on the adaptation and filming rights of Zhi Chen (the original name of Yao Chen) over the script of Meihualao, and that the producers of the TV drama Gongsuoliancheng must halt the reproduction, distribution and broadcast of such TV drama immediately and post an apology notice. The decision explained how Òsubstantial similarityÓ should be determined in literature, which is instructive as to how ÒideasÓ and ÒexpressionÓ is done in terms of plot selection, structural arrangement and plot advancement.