The Supreme People’s Court has released the Decision on Revising the Several Provisions of the Supreme People’s Court on Issues concerning the Application of Law in the Trial of Patent Dispute Cases (the “Decision“), with effect as of February 1, 2015. The original Several Provisions of the Supreme People’s Court on Issues concerning the Application of Law in the Trial of Patent Dispute Cases (the “Several Provisions“) took effect on July 1, 2001 and has only been slightly amended once ever since the PRC Patent Law was modified in 2008.
The Decision mainly reflects the changes to the amended PRC Patent Law back in 2008 and make the judicial interpretation consistent with the PRC Patent Law. For example, the Decision removes the cap for infringement damages and defers to the provisions in PRC Patent Law. In addition, there are some new highlights in the Decisions as follows.
- Modified method of determining Infringement damages
The plaintiff can no longer freely choose either the loss by the patent owner or the illegal gain by infringer to determine infringement damages. Rather, the Court will need to count damages in the following order as provided in the PRC Patent Law: (i) loss by patent owner; (ii) illegal gain by infringer; (iii) license fee reasonably multiplied; and (iv) statutory damages. Only when the prior method cannot yield an amount will the court resort to the subsequent method to determine damages.
As for the doctrine of license fee reasonably multiplied, the Decision removes the mandate that the court can only multiply 2 to 3 times license fee. The court may determine at its discretion as to how the license fee should be multiplied on a factual basis.
- Search report no longer required in utility model and design patent case
Search report is no longer a required document to bring an infringement case for utility model and design patent. In the old Several Provisions, a search report is required when a utility model patent owner tries to file a complaint at the court. The new Decision removes such requirement and provides that the plaintiff may provide such search report when filing a complaint. The court may also request the plaintiff to provide a search report if actual needs arise if the plaintiff does not submit one when filing the complaint. It decreases the burden of production when filing a complaint. However, in practice, it is very likely that the court will request one and patent owner is highly advised to apply for a search report early in the enforcement proceeding.
Search report was an old term before the PRC Patent Law was modified in 2008 and became effective on Oct. 1, 2009, after which it has been called patent evaluation report and has been available to design patent as well. Now, the SIPO issues search report for utility model patents with application dates prior to Oct. 1, 2009, and issues patent evaluation report for utility model and design patents with application dates on and after Oct. 1, 2009. The SIPO does not issue search reports for Design patents with application dates before Oct. 1, 2009. Both search report and patent evaluation report assess the validity of patents and serve as important references in various scenarios including patent infringement cases.
- Jurisdiction expansion in design patent infringement case
The Decision provides that the place where products, suspected of design patent infringement, are offered for sale has jurisdiction over the design patent infringement case. Design patent owners will have great flexibility in bringing up infringement cases as invention and utility model patent owners.
- Doctrine of equivalents redefined
The Decision redefines equivalent technical features as ” the technical features that use similar means, realize similar functions and achieve similar effects as the technical features indicated in the patent claims, and that the ordinary technological personnel of this field may think out without creative work at the time of alleged infringement taking place (emphasis added).”
The emphasized part “at the time of alleged infringement taking place” is the newly introduced element in applying the doctrine of equivalents. This new element qualifies the time frame where the technical features can be deemed as equivalent technical features which might increase the burden of proof on the plaintiff.
Conclusion
Overall, the changes reflected in the Decision are more technical than substantial. The Decision has lowered the barrier to bring civil litigation cases for design and utility model patents by removing the requirement of submitting a search report. It also streamlines the sequential determination of infringement damages. We will see how court implements these new clauses.
