Recently, the Supreme People's Court released the 17th batch of five guiding cases, including one related to intellectual property rights.

Guiding Case No. 92 "Laizhou Jinhai Seeds Co., Ltd. vs. Zhangye Fukai Agricultural Science and Technology Co., Ltd. Dispute over infringement of New Plant Variety Rights " aims to define the determination of approximate varieties. According to the agricultural industry standard NY/T1432-2007 "Maize Variety Identification Molecular Techniques”, when the number of different loci between two varieties is 1, they shall be considered as approximate varieties; greater than or equal to 2, different varieties. If the number of different loci equals 1, it is insufficient to determine whether they are the same varieties. For those with number of different loci below 2, other factors shall be taken into consideration to determine whether they are different varieties, such as conducting test on expanded range of loci, or submitting validated sample for testing. The burden of proof is borne by the party who are alleged as infringing. It is of great value in guiding the people’s courts in proper application of the burden of proof rules, and the trial of similar cases in the field of new plant variety rights. (Source: Supreme People's Court)

On November 4, 2017, the revision to the Anti-Unfair Competition Law of People’s Republic of China (“AUCL”), which came into effect on December 1, 1993, was passed at the 30th meeting of the 12th NPC Standing Committee, and came into force on January 1, 2018.

The newly revised AUCL focuses on regulating unfair competition in the Internet, in particular against false propaganda such as fraudulent transactions and exploitation of reviews in the field of electronic commerce. The revised AUCL clearly stipulates that operators should not make any false or misleading commercial propaganda about the "sales status" or "user rating" of their products, nor can any operators conduct false or misleading commercial propaganda through such means as fraudulent transactions, otherwise they will face a fine of up to 2 million yuan.

Commercial bribery to seek trading opportunities or competitive advantage, is also one of the acts the new AUCL aims to regulate. The amendment further clarifies the targets of commercial bribery, including the employees of counterparty and the entities and individuals entrusted by the counterparties of the transaction, the organizations and individuals that use their power and influence to influence the transaction. It also stipulates that if an employee of a business operator bribes somebody, it shall be regarded as bribing conducted by the business operator as well, unless he/she can prove that the employee’s act of bribing has nothing to do with the business conduct.

The revised AUCL also defines unfair competition conducts in the Internet field such as "malicious implementation of incompatibilities with other network products or services".

For more information of IP related articles in the revised AUCL, please visit the following link:

Unitalen Article: Comments on the Articles Related to Intellectual Property in the New Anti-Unfair Competition Law

On November 13, 2017 Director of China Intellectual Property Office, met with Director of Brazilian Industrial Property Office, in Beijing. The two sides conducted in-depth exchanges on further deepening bilateral cooperation and signed a Memorandum of Understanding on Cooperation between the two offices and a Patent Prosecution Highway (PPH) cooperation agreement.

It is reported that the two offices will launch the PPH pilot project on February 1, 2018 to help China and Brazilian patent applications be granted in each other’s countries as soon as possible.

China Intellectual Property Office launches PPH pilot Projects with Chilean IP Office and Czech IP Office on January 1, 2018.

Pursuant to the related Memorandum of Understanding, the China – Chile PPH pilot project shall start on January 1, 2018 for a period of three years up to December 31, 2020, and the China – Czech PPH pilot project of China - Chile shall start on January 1, 2018 for a period of two years up to December 31, 2019

Case Summary

In August 2008, SAS ESTABLISSEMENTS A CHOLLET (CHOLLET) ordered 57,600 safety kits from ZHEJIANG DAOMING OPTICS & CHEMICAL CO. LTD. (DAOMING) through TEST RITE INTERNATIONAL CO., LTD. (TEST RITE), which were later discovered as neither meeting the requirements of the order nor conforming to EU standards, so that they could not be sold in the market. On February 16, 2010, CHOLLET filed a lawsuit against TEST RITE and DAOMING at France Bobigny Commercial Court. With representatives of all 3 parties attending the hearing, the court made judgement on October 18, 2011 and served the same to DAOMING’s litigation representative on November 4, 2011. As no appeal was filed within the time limit, the Paris Court of Appeal issued the ruling to close the litigation procedure on February 25, 2014.

January 6, 2016, on behalf of applicants CHOLLET and TEST RITE, Unitalen filed petition to Zhejing Jinhua Municipal Intermediate People's Court for recognition and enforcement of French Bobigny Commercial Court No. 2011F01203 civil judgment.

During review of the case, DAOMING raised objections that, for the two separate contracts between the 3 parties, the French Commercial Court of Bobigny shall have no jurisdiction over the contract dispute between TEST RITE and DAOMING, and requested that the court should not be recognize and enforce the French judgment.

In accordance with "Civil Procedure Law of the People’s Republic of China" and "Agreement between People's Republic of China and the Republic of France on Civil and Commercial Judicial Assistance" as well as other relevant provisions, Unitalen lawyers conducted thorough analysis on the key issues such as whether the French court shall have the appropriate jurisdiction, and the type of contractual relationship among the parties involved. Jinhua Intermediate People's Court finally ruled that the Commercial Judgment of the French Bobigny Commercial Court shall be recognized and put into enforcement.

This case reflects China courts commitment to implement judicial assistance agreements, recognize and enforce foreign courts’ civil and commercial judgments in accordance with laws, so as to provide equal protection to the legitimate rights and interests of both Chinese and foreign parties. As a rare successful case for recognition and enforcement of French civil and commercial judgment, it provides significant reference to the adjudication and judgment of similar cases in the future.

Case Background

The plaintiff Technogym, one of the world leading manufacturers of fitness equipment, claimed protection of its design patent for treadmill called "Run ARTIS” against the defendant, Tianzhan company, for the reason that the defendant possessed the special equipment and molds for manufacturing the allegedly infringing product TZ-7000 treadmill, mass-produced, assembled and stored the TZ-7000 treadmill products in its factory, as well as sold and offered to sell a large number of the above-mentioned infringing products through Internet, hence requesting the court to issue injunction against the defendant and to order defendant compensate the plaintiff’s the actual losses of RMB 1 million and reasonable legal costs of RMB 200,000.

Judgment Result

After trials by Jinan Intermediate Court of first instance and Shandong High Court of second instance, both courts held that the allegedly infringing treadmill products produced, sold and offered for sale by the defendant fall into the protection scope of the plaintiff’s design patent, thus supported the plaintiff’s requests.

Highlights

1. Changes in pre-trial evidence preservation.

In this case, the judge adopted the means such as taking pictures of the production sites, production molds, semi-finished products, a large number of finished products and the loading site, and keeping records of the inventory and molds for evidence preservation, which allows the preserved party to continue to use the production molds, while effectively preserving the evidence.

2. No suspension of trial based on defendant’s invalidation petition

In earlier patent litigations, especially those concerning utility model patent and design patent infringement, usually when a defendant initiated invalidation action against the patent at dispute, the court would rule to suspend the trial until the invalidation petition is concluded. In this case, however, after full consideration of the evidence submitted by both parties in the litigation procedure, the collegial panel believed there is very low chance for the plaintiff’s design patent to be invalidated, and held that there was no need to suspend the trial, which greatly increased the efficiency of the trial.

In the second instance, the defendant argued that the court of first instance compared the photos of the allegedly infringing product with the views of the design patent, omitting a large amount of design details, thus led to a wrong judgment. However, the court of second instance, in accordance with the second paragraph of Article 59 of the Patent Law, held that the practice of comparing the photos of the allegedly infringing products with the views of the patented design complies with the law.

4. Use of evidence in support of claims for damage compensation and reasonable legal costs.

In the first instance trial, the plaintiff requested the court to order defendant’s export data between 2012 and August 2016. The judge also noticed during the pre-trial evidence preservation that a large number of infringing products were stored in the defendant's warehouse. After hearing, the court held that the plaintiff’s request for compensation of 1 million yuan was reasonable as the defendant exported nearly 1,200 pieces of infringing products for the value of nearly 7 million yuan during 2015 and first half of 2016 alone. Therefore, the customs data and evidence preserved have played an important role in obtaining court support’s on the plaintiff's claim.

On November 28, 2017, at the invitation of the Russian Technology Transfer Association, the Russian Export Center, the Russian Internet Development Fund and the Russia-China Law Society, Unitalen lawyers, Lei Zhao and Wei Pan, attended a symposium on China’s intellectual property held in Mosco.

The conference aims to explore how Russian companies can protect intellectual property and avoid business risks in China. During the conference, attendees exchanged opinions on patent and copyright protection of software, patent protection of pharmaceuticals, trends of patent protection, administrative enforcement and judicial protection of intellectual property rights in China, as well as technology secrets and trademark protection strategies. Unitalen Lawyer Wei Pan gave introduction on the general situation of patent prosecution and litigation in China, revision of reexamination guideline, and the ongoing 4th revision of Patent Law, while Lei Zhao focused on the development of China’s IP enforcement from practical perspective and shared typical cases concerning trademark protection and trade secret protection.

At the beginning of Year 2018, China Youth Development Foundation awarded a donation certificate to Unitalen for funding the construction of Hope School. By now, Unitalen has kept its commitment to build a Unitalen Hope School each year for over a decade since 2006.

The school receiving aid from Unitalen this year is located in a remote village in Tengchong City, Yunnan Province. The school was established in 1946; its academic achievement has always been among the best ranks. But the existing school size has failed to meet the educational requirements and parental expectations, with many dormitories, classrooms, canteens, toilets and other buildings in use listed as D-class dilapidated buildings.