The First Case of the IP Court of the Supreme People’s Court Of China is Finished

by Di Wang (Shanghai Patent and Trademark Law Office, LLC.China)

On March 27, 2019 the IP court of the Supreme People’s Court of China (“SPC”) finished its first case, an appeal of patent infringement since its establishment on January 1, 2019.

The appellants are two Chinese car accessories companies, Xiamen Lukasi Car Accessories Co. Ltd. (“Lukasi”) and Xiamen Fuke Car Accessories Co. Ltd. (“Fuke”), and the appellee is French automotive parts manufacturer Valeo Systemes D’Essuyage (“Valeo”), and Chen Shaoqiang, a defendant of the first instance also joined. The verdict of the first instance was upheld, which was a part-judgment issued by the Shanghai Intellectual Property Court (“SIPC”).

It is the first time that the SIPC issued such a part-judgment (or “interim judgment”). According to Article 153 of the Civil Procedure Law of PRC, “if some of the facts in a case being adjudicated by a people’s court have already been clear, the court may render judgments regarding these facts first”. However, part-judgment is not yet common with complicated IP cases. With Several Opinions of the Higher People’s Court of Shanghai on Strengthening Judicial Protection of Intellectual Property Rights (“the Opinions”) published by the SIPC on July 27, 2018, it is to be expected that in the future for trials of IP cases with relatively complicated facts, when some of the facts and the requests have already been clear through adjudication and when necessary, a part-judgment regarding that part can be issued by the court so as to improve the timeliness of dispute resolution.

An advantage of part-judgment is that the infringement acts will be ordered to stop by the court before the usually time-consuming part of an IP infringement lawsuit, the calculation of the compensation of damage, is done, which avoids an IP right holder currently often faced problem that although the case is won by the right holder eventually, he or she may have already lost the market during the long process of the trial. Further, the part-judgment also provides the possibility that two parties may settle the compensation before a final verdict is reached in light of the part-judgment. This will benefit both the parties involved and save court resources.

The impact of part-judgment on preliminary injunction remains to be seen, which is currently widely discussed yet not answered by SPC this time. In the first instance, Valeo requested both a part-judgment and a preliminary injunction. Only the part-judgment was issued. After the part-judgment was issued on January 22, 2019, the defendant appealed, and the final judgment was issued on March 27, 2019. In this case, there is a period of about two months for the right holder to wait before the part-judgment finally becomes a permanent injunction. Considering the judgment of this case was announced in court, this period is already relatively short. Thus it is still to be discussed whether a preliminary injunction shall be requested (and whether it will be allowed) in IP lawsuits when a part-judgment is requested at the same time in the future in view of litigation strategy.

The part-judgment provides a more efficient option to the IP right holder seeking protection against urgent infringement and the trial of this case shows the determination for intensified protection for intellectual property rights in China.

  1. (2019) Zui Gao Fa Zhi Min Zhong No. 2
  2. (2016) Hu 73 Min Chu No. 859