Speaking at the Symposium on IPR Aid for Local Enterprises, General Protecht Group Inc. (Protecht) President Chen Wusheng, said that Protecht had spent over 120 million yuan for the expensive legal cost during the seven-year vigorous patent defense. China should develop IPR dispute resolution mechanisms and enhance companies' awareness and capacity in coping with IPR issues in oversea markets, according to analysts.

Tough war

Protecht, the leading exporter of the electric leakage protection industry, has encountered a series of oversea patent litigations and "337 investigations" ever since its debut in  the U.S. market in 2004, which obviously moved the cheese of local competitors who immediately pushed back.

After Protecht prevailed in the cases in 2005 and 2007, Leviton, one of the leading electrical giants in the U.S., filed for "337 investigation" at the International Trade Commission (ITC) on September 3 2010, alleging infringement of its patent by Protecht and four other Chinese companies. ITC official formally took the case on October 5 of that year. Then on October 28, Protecht sued Leviton in New Mexico for breach of their July 2007 settlement agreement and sought damages. The court issued a preliminary injunction and ordered Leviton to withdraw its 337 case and the suspending case in the Northern District of California. Leviton then filed a reverse motion. On December 2, the court heard the case via teleconference and rejected Leviton's motion. Protecht tasted the fifth straight victory in oversea patent litigation.

Protecht also brought suits to court in China on July 16, 2008, alleged U.S.-based Pass & Seymour Inc. (P&S)'s factories in China infringing its patents. The defendant then brought actions before SIPO's Patent Reexamination Board (PRB) on September 12, 2008 to invalidate the Protecht patents. PRB affirmed the validity of the patents. P&S then appealed to the Beijing No.1 Intermediate Court, which would sustain the first instance on June 15, 2011. The disgruntled P&S then appealed to Beijing High People's Court on June 30. We will follow the developments of the case.

Afterthought

"IPR has become a more important tool in market competition.You have IPRs, you have the core competitiveness." Chen said, "enterprises should be aggressive in suit while strengthening their the capability of creation, application, protection and management of IPR."

China should develop and improve IPR dispute resolution mechanisms. On the one hand, some authorities ought to strengthen support for the enterprises overseas and enhance Chinese businesses' awareness and capacity in coping with IPR issues while operating in oversea markets. On the other hand, the interrelated industries or organizations should establish patent alliance, strengthen enterprises' capacity for self-generated R&D, ease their trade barriers together and sum up experience for local enterprises in doing business overseas in an effective way.

(China IP News)