China: The Supreme People’s Court Issued Top 10 IP Cases Decided by Chinese Courts in 2015

by Weining Wang and Xiaolin Dang (Beijing Sanyou IP Agency Ltd. China)

I. Civil Cases on IP

Shijiazhuang Double-Ring Automobile Co. Ltd v. Honda Motors Co., Ltd. [The Supreme People’s Court (2014) IP Tribunal’s Final Civil Judgement No. 7]

After action for declaratory judgement relief and design patent infringement had been commenced by the alleged infringer and patentee, respectively, the patentee continued to send warning letters to downstream customers of the alleged infringer which disclosed neither any specific reasons why the product infringed, nor the fact that legal proceedings had been commenced. These facts would have been relevant to any determination for the downstream customers to voluntarily cease the alleged infringing conduct. Since the downstream customers of the alleged infringer were also target customers for the patentee, the patentee’s conduct was held to amount to unfair competition and an award of damages was made against the patentee.

Grohe AG v. Zhejiang Jianlong Bathroom Ware Co., Ltd. [The Supreme People’s Court (2015) Civil Re Judgement No. 23]

In the context of design patent infringement, the Court ruled that where the accused product did not contain all of the distinguishing design features of the design patent over prior designs, then a preliminary conclusion of non-similarity could be deduced. The Court also discussed functional design features of a design patent.

Weihai Jiayi Roast Household Appliances Co., Ltd. v. Yongkang Jinshide Industry & Trade Co., Ltd., Zhejiang Tmall Network Co., Ltd. [Zhejiang Provincial High People’s Court (2015) Zhejiang IP Final Civil Judgment No. 186]

The Court held that once Zhejiang Tmall Network Co., Ltd, in conducting its electronic commerce platform, was aware of the rights of the patent owner, it was required to take necessary measures to avoid further infringement. By taking no measures, Zhejiang Tmall Network Co., Ltd was jointly liable for further damages.

Guangzhou Xinghewan Industrial Development Co., Ltd., Guangzhou Hongfu Real Estate Co., Ltd. v. Jiangsu Weifu Group Construction and Development Co., Ltd. [The Supreme People’s Court (2013) Civil Re Judgement No. 102]

The Supreme Court did not grant an injunction preventing the use of the trade mark by the defendant in relation to real estate which it had sold, because of third party and the public’s interests. However, the Court did grant an injunction preventing the use of the trade mark by the defendant in relation to existing unsold properties, and any future real estate.

Beijing Zhongchuang Educational Science & Technology Co., Ltd v. Beijing Haidian Qihang Exam Training school, Beijing Qihang Century Science and Technology Development Co., Ltd. [Beijing IP Court (2015) IP Final Civil Judgement No. 588]

The Beijing Intellectual Property Court ruled that the defendant did not infringe the plaintiff’s trade mark, because the defendant had used its mark and acquired a level of recognition, prior to the filing date of the plaintiff’s trademark. This case applied the recently amended Article 59 of the Trademark Law.

Shanghai Pavlos Stationery Co., Ltd. v. Shanghai Yixiang Stationery Co., Ltd., Picasso International Enterprise Co., Ltd. [Shanghai High People’s Court (2014) IP Final Civil Judgement No. 117]

In this case, use of the trade mark was successively exclusively licensed to different licensees, but the use term of the two licenses overlapped. The Court ruled that the latter license was not invalid, as there was no subjective malice on the part of the latter licensee, no collusion between the latter licensee and licensor, and no violation to any mandatory provisions of the law. However, the Court ruled that the former exclusive license prevailed over the latter license because the latter licensee was not a bona fide third party, due to its knowledge of the former license before the later licensee signing the license.

Chen Zhe v. Yu Zheng et al. [Beijing High People’s Court (2015) IP Final Civil Judgement No. 1039]

The Court explained the principles concerning ‘substantial similarity’ in relation to literary works. The Court also provided guidance on the distinction between ‘idea’ and ‘expression’ in relation to features of plot, structure, advancing the plot design in literary works.

Blizzard Entertainment Co., Ltd., Shanghai Netease Network Technology Development Co., Ltd. v. Chengdu Qiyou Technology Co., Ltd. et al. [Guangzhou IP Court (2015) Guangdong Copyright First Instance Civil Ruling No. 2-1, and Guangzhou IP Court (2015) Guangdong Commercial First Instance Civil Ruling No. 2-1]

The Court granted a preliminary injunction preventing the defendant from operating online games after considering the features of online games and the likelihood of winning, and balancing the interests of both parties.

II. Administrative Case on IP.

Warner-Lambert Company LLC. v., The Patent Reexamination Board of the SIPO, Beijing Jialin Pharmaceutical Co., Ltd. [The Supreme People’s Court (2014) Administrative Re Judgement No. 8]

The Supreme Court ruled that for a chemical compound to meet the sufficient disclosure requirement as for patentability, the specification must disclose the identifiable chemical compound, the method of manufacture and its use. The patent in issue failed to meet the sufficient disclosure requirement and, therefore, was invalid.

III. Criminal Case on IP

The Court held that the defendants, Sheng Zhang and Li Zou, were constituting a counterfeiting a crime for a registered trade mark and the defendant, Weibao Wang, was constituting a crime for selling goods manufactured illegally bearing the registered trademark [Hubei Provincial High People’s Court (2015) IP Final Criminal Ruling No.1].

This case was a criminal case relating to counterfeiting a registered trade mark and was decided by the Intellectual Property tribunal, not the criminal, tribunal of the Court. It was a typical “three in one” adjudication case involving intellectual property, with an integrated, centralized adjudication on the civil, criminal and administrative issues.