I. Receiving and Resolving of IP Cases

Receiving: Number increased, wide regional disparities;
         Amount of disputed bid increased;
        More technical and professional complexity;
        Cases involving foreign parties increased.
Resolving: Trial time shortened, and speed increased;
       Open trial and open legal documents. 

II. Introduction of Judiciary Interpretations and Improved Judiciary Basis

Before and after China's accession to the World Trade Organization, the Supreme People's court has been playing an active role to unify the judiciary practice in China by enhanced judiciary interpretation and guidance to cases, in addition to revision of laws and regulations.
The important judiciary interpretations in the past three years include:
Several Provisions for the Application of Law in the Trial of Patent Disputes (June 21, 2001);
Several Provisions for the Application of Law to Stopping Infringement of Patent Right before Instituting Legal Proceedings; (September 7, 2001)
Interpretation of Several Issues Concerning the Application of the Law to the Trial of Civil Dispute Cases Involving Trademarks; (October 12, 2002)
Interpretation on the Issues of Rule and Application of Laws in the Trial of Trademark Cases; (January 9, 2002)
Interpretation on the Application of Law to Stopping Infringement of Exclusive Right of Using Trademarks and Evidence Preservation before Instituting Legal Proceedings; (October 12, 2002)
Interpretation on the Application of Laws in the Trial of Civil Disputes over Domain Names of Computer Network; (June 26, 2001)
Interpretation on Several Issues concerning the Trial of Disputes over New Varieties of Plant; (December 25, 2000)
Notice on Starting Trials of Cases Involving Layout-design of Integrated Circuit; (October 30, 2001)
Several Provisions on the Evidence for Civil Litigation; (December 6, 2001)
Several Provisions on the Evidence for Administrative Litigation; (June 4, 2002)
Those judiciary interpretations are the main legal basis for the people's courts to try disputes over intellectual property rights.

III. Types of IP disputes are increased, and the litigious scope is enlarged.

In addition to typical disputes, the following types of disputes appear:
1. Disputes involving titles for new varieties of plants;
2. Disputes involving layout-design of integrated circuit;
3. Disputes involving rights for utility models, industrial design and trademark;
4. Disputes involving pre-trial stopping of acts infringing patents, trademarks, and copyrights, as well as preservation of property and evidence;
5. Disputes involving the ownership of trademarks;
6. Disputes involving "One award two receivers" for service inventions;
7. Requests for confirmation of non-infringement of patent rights.

IV. Rule of IP disputes is alleviated to a higher level of authority and broadened to a wider locality

1. Administrative cases of confirmed patents and trademarks are designated to the Beijing First Intermediate Court for first trial;
2. Disputes over trademarks and copyrights are designated to the Intermediate Court for first trial;
3. Patent disputes are designated by the Supreme People's Court to the 47 intermediate courts for first trial;
4. Right holders may jointly sue the persons who have manufacturing behaviors in the locality of sale, and local courts in such locality have jurisdictional power.

V. There are more ways to protect intellectual property rights, and yet more still needs to be done.

1. The Patent Law, the Trademark Law and the Copyright Law have new provisions that parties concerned may apply for pre-trial stopping of infringement when infringement is or will be happening;
2. The Patent Law stipulates that infringement from sales behavior shall all be stopped whether or not it is clearly known, and in deciding compensation to consider whether the products are from legitimate sources;
3. The Patent Law stipulates that the right holders may prohibit behaviors of offering for sale;
4. Certification and protection of well-known trademarks is introduced in the new Trademark Law;
5. Relevant judiciary interpretations of the Supreme People's Court have provisions for the unified identification criteria for infringement.

VI. The principle of protection of prior rights is clarified in solving right conflicts.

1. Judiciary interpretations clearly define what is right conflicts: trademark right, copyrights, patent right, trade name, portraits, special packing of well-known products, and right to use decoration;
2. Right conflicts shall be prohibited in authorizing rights, which is stipulated in Article 23 of the Patent Law and Article 31 of the Trademark Law;
3. The legitimate rights of the parties with prior rights shall be protected in infringement litigations involving right conflicts.

VII. Clear and specific litigation time

During the validity period of right, if the infringement still continues, the defendant shall be ordered to stop infringement but the calculation of compensation for civil remedies will only be traced back for 2 years.

VIII. Statuary damage and ration damage is introduced in the calculation of damages.

There are three ways to calculate damages: losses of the plaintiff, profits of the defendant, or 1 to 3 times the amount of royalties.
Article 56 of the Trademark Law stipulates the statuary damage to be less than 500,000 RMB;
Article 48 of the Copyright stipulates the statuary damage to be less than 500,000 RMB;
Judiciary interpretation of patent stipulates a ration damage between 5,000 to 300,000RMB, and not to exceed 500,000 RMB;
Reasonable fees for investigation and lawyers.

2004-01-02

2004-01-02