Legislation
The Patent Law is enacted to protect the legitimate rights of patentees, to encourage inventions-creations, to advance the exploitation of inventions-creations, to enhance innovation capability, and to promote the progress of science and technology and the development of economy and society.
Patent Law & Implementing Regulations
Patent Law: Adopted by the Standing Committee of National People's Congress on March 12, 1984 and entering into force on April 1, 1985, amended for the first time on September 4, 1992 and entering into force on January 1, 1993, amended for the second time on August 25, 2000 and entering into force on July 1, 2001, amended for the third time on December 27, 2008 and entering into force on October 1, 2009, amended for the fourth time on October 17, 2020 and entering into force on June 1, 2021.
Implementing Regulations: Promulgated by the State Council on January 19, 1985 and entering into force on April 1, 1985; revised on December 21, 1992 and entering into force on January 1, 1993; and repealed on July 1, 2001. Promulgated on June 15, 2001 and entering into force on July 1, 2001, revised for the first time on December 28, 2002 and entering into force on February 1, 2003, revised for the second time on January 9, 2010 and entering into force on February 1, 2010, and revised for the third time on December 11, 2023 and entering into force on January 20, 2024.
China Patent Administration
The China National Intellectual Property Administration (CNIPA) is responsible for the patent work throughout the country. It receives and examines patent applications, and grants patents in accordance with the law.
The local intellectual property offices in provinces, autonomous regions and municipalities directly under the central government are responsible for the administrative work concerning patents in their respective administrative areas.
Types of Patents
Inventions and creations or invention-creations in the China patent law include inventions, utility models, and designs. Accordingly there are three types of patents in China, i.e. invention patents, utility model patents and design patents.
Obtaining a Patent
For obtaining a patent, the right holder of invention-creations may directly submit a patent application to the CNIPA. After examinations, the CNIPA will grant a patent if the conditions for granting a patent are met.
For the details about obtaining a patent before the CNIPA, please see
Outline of CN Patent System_Basics_ Invention,
Outline of CN Patent System_Utility Model,
Outline of CN Patent System_Design.
Patent Rights
After the grant of a patent for invention, except where otherwise provided for in the Patent Law, no entity or individual may, without the authorization of the patentee, exploit the patent, that is, make, use, offer to sell, sell or import the patented product, or use the patented process and use, offer to sell, sell or import the product directly obtained by the patented process, for production or business purposes.
After the grant of a patent for utility model, except where otherwise provided for in the Patent Law, no entity or individual may, without the authorization of the patentee, exploit the patent, that is, make, use, offer to sell, sell or import the patented product, for production or business purposes.
After the grant of a patent for design, no entity or individual may, without the authorization of the patentee, exploit the patent, that is, make, offer to sell, sell or import the product incorporating the patented design, for production or business purposes.
Scope of Protection
The scope of protection of a patent for invention shall be determined by its claims. The description and the drawings may be used to interpret the content of the claims.
The scope of protection of a patent for utility model shall be determined by its claims. The description and the drawings may be used to interpret the content of the claims.
The scope of protection of a patent for design shall be determined by the design of the product as shown in the drawings or photographs. The brief specification may be used to interpret the design of the product as shown in the drawings or photographs.
Patent Protection
After being granted a patent, a patentee enjoys the aforementioned patent rights within the scope of protection, which are protected under the Patent Law.
Where another party exploits a patent without the patentee's authorization, it constitutes infringement of the patent, except where otherwise provided for in the Patent Law. Any disputes arising from patent infringement shall be resolved through negotiation between the parties. If the parties are unwilling to negotiate or the negotiation fails, the patentee or interested party may institute a lawsuit in the court (seeking judicial relief) or request the patent administrative department to handle the dispute (seeking administrative relief).
This article will discuss the proceedings for judicial relief.
For seeking administrative relief, please refer to the Outline of China System_Patent Protection via Administrative Relief.
Patent Infringement
Where another party exploits a patent without the patentee's authorization, except where otherwise provided for in the Patent Law, it constitutes infringement on the patent, which includes the following acts:
(1) Making, using, offering to sell, selling, or importing a patented product for production or business purposes without the authorization of the patentee;
(2) Using a patented process and using, offering to sell, selling, or importing a product directly obtained by the patented process, for production or business purposes, without the patentee’s authorization; or
(3) Making, offering to sell, selling, or importing the product incorporating a patented design for production or business purposes, without the patentee’s authorization.
Determination of Infringement Act
In preparation of litigation documents and response, rights holders or other relevant parties may refer to the following definitions of factors that the court will consider in determining patent infringement.
Offering to sell
Offering to sell refers to the expression of intention to sell products by means of advertising, display in shop windows or exhibition at trade fairs.
Selling
Where a product sales contract is established in accordance with the law, the court shall determine that it constitutes selling as provided for in the Patent Law.
Contributory Infringement
Where a person knows that a certain product is materials, equipment, components, or intermediates specifically for the exploitation of a patent and, without the rights holder's authorization, provides such product to others for the purpose of production or business and the others thereby infringes the patent, and the rights holder claims that the provider's actions constitute assisting others in committing infringement as prescribed in the Civil Code, the court should support the claim.
Inducing Infringement
Where a person, knowing that a product or process is patented, actively induces others to infringe the patent for production or business purposes without the patentee's authorization, and the rights holder claims that the inducer's actions constitute inducing infringement as prescribed in the Civil Code, the court shall support the claim.
Determination of Infringement on Invention/Utility Model Patents
Determining the Scope of Protection
Plaintiff's Claims:
The court shall, based on the claims asserted by the rights holder (plaintiff), determine the scope of protection of a patent in accordance with the provisions of the Patent Law. Where the rights holder modifies its asserted claims before the conclusion of debate in the trial of the first-instance, the court shall approve the modification.
Where the rights holder claims the scope of protection of a patent based on a dependent claim, the court shall determine the scope of protection of the patent based on the additional technical features recited in the dependent claim and the technical features recited in the claims it depends on.
All technical features:
The expression “the scope of protection of an invention or utility model patent is determined by the content of its claims and the description and drawings may be used to interpret the content of the claims” means that the scope of protection of a patent should be determined by the scope of all technical features recited in the claims, including the scope determined by features equivalent to those technical features.
When the court determines the scope of protection of a patent, the technical features described in the preamble and characterizing sections of an independent claim, as well as the reference and limitation sections of dependent claims, all serve as limitations.
Equivalent Features:
Equivalent features refer to features that perform substantially the same function, by substantially the same means, and achieve substantially the same effects as the recited features, and that a person of ordinary skill in the art could have conjured up without engaging in creative effort at the time the alleged infringement occurred.
Description and Drawings:
The court shall determine the content of the claims based on the definition of the claims and the understanding of the claims by persons of ordinary skill in the art after reading the description and drawings.
Where there is ambiguity in the grammar, text, punctuation, graphics, symbols, etc. in the claims, description, and drawings, but a person of ordinary skill in the art can reach a unique understanding after reading the claims, description, and drawings, the court shall make a determination based on that unique understanding.
Patent Examination Files:
The court may interpret the claims based on the description and drawings, relevant claims in the claims, and patent examination files. If the description specifically defines claim terms, the specific definition shall prevail.
The court may interpret the claims of a patent at issue based on other patents that are divisional applications related to the patent at issue, their patent examination files, and effective judgments related to the grant and confirmation of the relevant patents.
Patent examination files include written materials submitted by patent applicants or patentees during patent examination, reexamination, and invalidation procedures, office actions issued by the CNIPA, meeting minutes, oral hearing minutes, and effective decisions on patent reexamination and invalidation proceedings.
Reference Books:
If the above approaches still cannot clarify the meaning of the claims, interpretation can be conducted in combination with reference books, textbooks, and other publicly known documents, as well as the general understanding by those of ordinary skill in the art.
Functional or Effect Features:
For technical features defined by functions or effects in a claim, the court shall determine the content of the technical features by combining the specific embodiments of the functions or effects described in the description and drawings, as well as equivalent embodiments.
Functional features refer to the technical features that are defined by the functions or effects of structures, components, steps, conditions, or the relationship between them in the invention-creation, unless a person of ordinary skill in the art can directly and clearly determine the specific embodiment for achieving the aforementioned functions or effects simply by reading the claims.
Undescribed Solutions:
Where a patentee attempts to include a technical solution described only in the description or drawings but not recited in the claims in a patent infringement case, the court will not support such inclusion.
Abandoned Solutions:
Where a patent applicant or patentee abandons a technical solution during the patent examination or invalidation proceedings by amending the claims or description or presenting observations, and the rights holder then includes the abandoned technical solution in the scope of the patent in a patent infringement dispute case, the court will not support such inclusion.
Infringement Determination Approach
When determining whether an accused infringing technical solution falls within the scope of a patent, the court shall examine all technical features recited in the claim asserted by the rights holder.
If the accused infringing technical solution contains technical features that are identical or equivalent to all the technical features recited in the claim, the court shall determine that it falls within the scope of the patent.
If the accused infringing technical solution lacks one or more technical features recited in the claim, or if one or more technical features are neither identical nor equivalent to any technical features recited in the claim, the court shall determine that it does not fall within the scope of the patent.
Products Obtained by Patented Processes
The court shall determine that original products obtained by using a patented process constitute products directly obtained by using the patented process as provided for in the Patent Law.
The court shall determine that subsequent products obtained by processing or treating the original products constitute products directly obtained by using the patented process as provided for in the Patent Law.
The court shall determine that products obtained by further processing or treating the subsequent products obtained by processing or treating products directly obtained by using a patented process do not constitute products directly obtained by using the patented process as provided for in the Patent Law.
Infringing Parts and Components
Where the product of an invention or utility model patent is used as a part or component in making another product, the court shall determine that such use constitutes using the patented product as provided for in the Patent Law. Where such another product is sold, the court shall determine that the selling constitutes selling the patented product as provided for in the Patent Law. In such cases, if there is a division of labor or cooperation between the accused infringers, the court shall determine that it is joint infringement.
Provisional Protection
After an invention patent application is published, the applicant may request that the entity or individual that exploited the invention pay appropriate fees.
Where the rights holder requests that the entity or individual that exploited the invention between the date of publication of the invention patent application and the date of grant pay appropriate fees, the court may determine the reasonable fees by referring to relevant patent licensing fees.
Where the scope of protection requested by the applicant at the time of publication of the invention patent application is inconsistent with the scope of protection of the granted patent, and the accused technical solution falls within both of the aforementioned scopes, the court shall determine that the defendant exploited the invention during the period referred to in the preceding paragraph. Where the accused technical solution falls within only one of the aforementioned scopes, the court shall determine that the defendant did not exploit the invention during the period referred to in the preceding paragraph.
After the grant of an invention patent is announced, if, without the authorization of the patentee, a product that has been made, sold or imported by another person during the period referred to in the second paragraph under this Provisional Protection is used, offered to sell or sold for production or business purposes, and such another person has paid or promised in writing to pay the appropriate fees prescribed in the Patent Law, the court shall not support the rights holder's claim that the above-mentioned using, offering to sell or selling infringes the patent.
Determination of Infringement on Design Patents
Infringement Determination Approach
Where an accused design identical or similar to the patented design is adopted on a product of the same or similar type as the product with the design patent, the court shall determine that the accused design falls within the scope of protection of the design patent.
Same or Similar Product Type
The court shall determine whether the types of products are the same or similar based on the intended use of the design product. The determination on the use of the product may make reference to factors such as a brief specification of the design, the International Design Classification, the product's functions, the product's sales and actual use.
Identical or Similar Designs
The court shall determine whether designs are identical or similar based on the knowledge and cognitive abilities of ordinary consumers of the patented design product.
When determining the ordinary consumers’ knowledge and cognitive abilities regarding designs, the court shall generally consider the design space of products of the same or similar categories as the patented design at the time the alleged infringement occurred. If the design space is large, the court may determine that the ordinary consumers are generally less likely to notice minor differences between designs. If the design space is small, the court may determine that the ordinary consumers are generally more likely to notice minor differences between designs.
When determining whether designs are identical or similar, the court shall make a comprehensive judgment based on the design features of the patented design and the accused infringing design, and on the overall visual effects of the designs. Design features that are primarily determined by technical functions and features relating to the product’s material and internal structure that do not affect the overall visual effect shall not be taken into account.
The following usually have a greater impact on the overall visual effect of a design:
(1) Parts that are easily and directly observed during normal use of the product;
(2) Design features that distinguish the patented design from existing designs.
If there is no difference in the overall visual effect between the accused infringing design and the patented design, the court shall determine that the two are identical; if there is no substantial difference in the overall visual effect, the court shall determine that the two are similar.
Infringing Parts or Components
If a product that infringes a design patent is used as a part of component in making and selling another product, the court shall determine that this constitutes selling under the Patent Law, unless the infringing product merely serves a technical function in such another product. In such case, if there is a division of labor and cooperation between the accused infringers, the court shall determine that it is joint infringement.
Exceptions to infringement
The following circumstances shall not be deemed as patent infringement:
(1) Using, offering to sell, selling or importing a patented product or a product directly obtained by a patented process after it is sold by the patentee or an entity or individual authorized by the patentee;
(2) Having already made the same product, usd the same process, or having made necessary preparations for such making or using before the filing date of the patent, and continuing to make the product or use the process only within the original scope;
(3) Using the relevant patent in the devices and equipment of a foreign transport vehicle that temporarily passes through China's land, territorial waters or airspace for its own needs in accordance with the agreement signed between its country and China or the international treaty both countries have joined, or in accordance with the principle of reciprocity;
(4) Using the relevant patent exclusively for scientific research and experimentation;
(5) Making, using or importing patented drugs or patented medical devices for the purpose of providing information required for administrative approval, as well as making or importing patented drugs or patented medical devices exclusively for such purposes.
Prior Art/Existing Design Defense
In a patent infringement dispute, if the accused infringer has evidence proving that the technology or design they exploit is a prior art or an existing design, their exploitation does not constitute patent infringement.
Where all the accused technical features falling within the scope of the patent are identical or not substantially different from the corresponding technical features in a prior art solution, the court shall determine that the technology exploited by the accused infringer is a prior art as provided for in the Patent Law.
Where the accused infringing design is identical to or not substantially different from an existing design, the court shall determine that the design exploited by the accused infringer is an existing design as provided for in the Patent Law.
Prior use right defense
Item (2) under “Exceptions to Infringement” is a prior use right defense, for which the technology for manufacturing products or using processes, or the designs incorporated in products shall be legally obtained. Where the accused infringer claims a prior use right defense based on illegally obtained technology or design, the court shall not support such claim.
In any of the following circumstances, the court shall determine that the necessary preparations for making or using have been made as stipulated in the Patent Law:
(1) The main technical drawings or process documents necessary for exploiting the invention have been completed;
(2) The main equipment or raw materials necessary for exploiting the invention have been manufactured or purchased.
The original scope stipulated in the Patent Law includes the production scale existing before the filing date of the patent and the production scale that can be achieved by using existing production equipment or based on existing production preparations.
Where the prior user transfers or licenses the technology or design that they have been exploiting or for which they have made necessary preparations for exploitation after the filing date of the patent, and the accused infringer claims that the exploitation behavior is continued within the original scope, the court shall not support it, except where the technology or design is transferred or inherited together with the original enterprise.
Seeking Judicial Relief
Where another party exploits a patent without the patentee's authorization, it is suspected of infringing the patent, against which the patentee or the interested party may institute a lawsuit in the court.
Jurisdiction
First-instance civil and administrative cases involving the ownership disputes, infringement disputes and monopoly disputes on invention and utility model patents shall be under the jurisdiction of the Intellectual Property Courts, the Intermediate People's Courts located in the seat of the people's government of a province, autonomous region, or municipality directly under the Central Government, and Intermediate People's Courts designated by the Supreme People's Court.
First-instance civil and administrative cases involving the ownership disputes, infringement disputes on design patents shall be under the jurisdiction of the Intellectual Property Courts and Intermediate People's Courts. With the approval of the Supreme People's Court, cases may also be heard by basic-level People's Courts, with the exception of administrative cases involving design patents.
Lawsuits arising from patent infringement shall be under the jurisdiction of the People's Court where the infringement occurred or where the defendant resides.
The place of infringement includes: the place where the acts of making, using, offering to sell, selling, or importing the product accused of infringing the invention or utility model patent are committed; the place where the acts of using the patented process are committed, or the place where the products directly obtained by the patented process are used, offered to sell, sold, or imported; the place where the acts of making, selling, or importing the product incorporating the patented design are committed; and the place where the acts of passing off another's patent are committed, as well as the place where the consequences of the above infringing acts occurred.
Where the plaintiff only sues the manufacturer of the infringing product and does not sue the seller, and the places of manufacture and sale of the infringing product are different, the court of the place of manufacture has jurisdiction. If the manufacturer and seller are jointly sued, the court of the place of sale has jurisdiction.
Where the seller is a branch of the manufacturer and the plaintiff sues the manufacturer of the infringing product at the place of sale for the manufacturing and selling, the court of the place of sale has jurisdiction.
The Beijing Intellectual Property Court has jurisdiction over first-instance cases filed by parties regarding whether the technical solutions related to drugs for which registration applications are filed fall within the scope of protection of other persons’ drug patents.
Statute of limitations
The statute of limitations for patent infringement is three years, calculated from the date the patentee or interested party knew or should have known the infringing act and the infringer.
Where a patentee institutes a lawsuit after the three-year time limit, if the infringement is still ongoing at the time of instituting the lawsuit, the court shall order the defendant to cease the infringing act within the valid term of the patent, and the damages for the infringement shall be calculated based on a period of three years preceding the date on which the patentee institutes the lawsuit with the court.
Where an invention is exploited between the date of publication of the invention patent application and the date of patent grant and the appropriate fees are not paid, the statute of limitations for the patentee to request the appropriate fees is three years, calculated from the date on which the patentee knows or should have known that others are using his/its invention. However, if the patentee already knew or should have known before the grant of the patent, the statute of limitations is calculated from the date of grant of the patent.
Burden of Proof
Evidence is crucial to win a lawsuit. Plaintiffs bear the burden of proof for their claims and must collect sufficient evidence to support their claims before instituting a lawsuit. Evidence collection is extremely vital, and plaintiffs can never attach too much importance to it.
In patent infringement disputes involving invention patents relating to new processes for manufacturing products, the entities or individuals manufacturing the same products must provide proof that their manufacturing processes differ from the patented processes.
If a product or the technical solution for manufacturing a product was known to the domestic and international public before the filing date of a patent, the court shall determine that the product is not a new product under the Patent Law.
Patent Evaluation Report
If a patent infringement dispute involves a utility model or design patent, the court may require the patentee or interested party to provide a patent evaluation report prepared by the CNIPA after searching, analyzing, and evaluating the relevant utility model or design, as evidence in the trial of the patent infringement dispute. The patentee, interested party, or accused infringer may also proactively provide a patent evaluation report.
If the plaintiff fails to submit such a report without justifiable reasons, the court may order the suspension of the proceedings or order the plaintiff to bear any potential adverse consequences.
In practice, plaintiffs instituting utility model/design patent infringement lawsuits will request and obtain patent evaluation reports from the CNIPA in advance of instituting the lawsuits; these reports will be submitted to the court during the litigation.
Preliminary Injunctions, Preservation Measures
Preliminary Injunctions and Property Preservation Order
If a patentee or an interested party has evidence to prove that another party is carrying out or is about to carry out an act that infringes upon their patent or impede the exercise of their rights, and that failure to promptly stop such acts will cause irreparable damage to their legitimate rights and interests, they may, before instituting a lawsuit, apply to the court for property preservation, an order to perform certain acts, or a prohibition on performing certain acts.
If a licensee under an intellectual property license contract applies for a pre-litigation injunction to cease intellectual property infringement, an exclusive licensee under an exclusive license contract may apply by itself to the court; a licensee under a sole license contract may apply by itself if the rights holder does not apply; and a licensee under a general license contract may apply by itself if explicitly authorized by the rights holder explicitly to sue in its own name.
The effectiveness of an injunction to cease intellectual property infringement generally lasts until the judgment in the case becomes effective.
Evidence Preservation:
To prevent patent infringement, if evidence is likely to be lost or difficult to be obtained in the future, the patentee or interested party may apply to the court for evidence preservation before instituting a lawsuit.
Behavior Preservation:
If a party to an intellectual property dispute applies for behavior preservation in accordance with the Civil Procedure Law before a judgment, ruling, or arbitration award takes effect, the court shall accept the application.
Applications for pre-litigation behavior preservation should be made to the court with jurisdiction over intellectual property disputes at the respondent's place of residence, or to the court with jurisdiction over the case.
If the parties agree to arbitration, they should apply for behavior preservation to the court specified in the preceding paragraphs.
If an applicant applies for behavior preservation based on a utility model or design patent, they must submit a search report, patent evaluation report, or a decision upholding the validity of the patent issued by the CNIPA. If an applicant refuses to submit these reports without justifiable reasons, the court shall rule to reject their application.
If an applicant applies for behavior preservation, they must provide security in accordance with the law. The amount of the security provided by the applicant must be equivalent to the losses that the respondent may suffer from the enforcement of the behavior preservation measure, including reasonable losses such as sales revenue and storage costs of the products involved in the order to cease the infringing activities.
If the losses that the respondent may suffer during the enforcement of the behavior preservation measure exceed the amount of the applicant's security, the court may order the applicant to provide additional security. If the applicant refuses to provide additional security, the court may rule to lift or partially lift the preservation measures.
Behavior preservation measures taken by a court generally are not lifted due to the respondent providing security, unless the applicant consents.
When a court orders the adoption of behavior preservation measures, it shall reasonably determine the duration of the measures based on factors such as the applicant's request and the specific circumstances of the case.
Multiple Preservation Applications:
If an applicant simultaneously applies for behavior preservation, property preservation, or evidence preservation, the court shall examine each type of preservation application separately to determine whether it meets the requirements and make a ruling.
To prevent the respondent from transferring property, destroying evidence, or other actions that would render the preservation purpose unattainable, the court may determine the order in which different types of preservation measures should be implemented based on the specific circumstances of the case.
Suspension by the CNIPA:
When a court exercises property preservation over a patent, it shall issue a notice of assistance in execution to the CNIPA, specifying the matters for which assistance is requested and the duration of the patent preservation, along with the ruling of the court.
The duration of patent preservation may not exceed six months at a time and shall be calculated from the date the CNIPA receives the notice of assistance in execution. If further preservation measures are still necessary for the patent, the court shall serve a separate notice of assistance in execution to the CNIPA before the expiration of the preservation period. Failure to serve such notice before the expiration of the preservation period shall be deemed to automatically terminate the property preservation over the patent.
The court may take property preservation measures against a pledged patent, and the pledgee's priority right to repayment will not be affected by these measures. Exclusive license agreements already signed between the patentee and the licensee do not affect the court's adoption of property preservation over the patent.
The court may not preserve patents again once they have already been preserved.
Early Resolution of Drug Patent Disputes
Under the early resolution mechanism for drug patent disputes (also known as the drug patent linkage system), during the drug marketing review and approval process, if a dispute arises between a marketing authorization applicant and a patentee or interested party regarding the patent associated with the drug under registration, the parties may file a lawsuit with the court, requesting a ruling on whether the technical solutions associated with the drug under registration fall within the scope of protection of the patent.
The National Medical Products Administration may, within a prescribed period, decide whether to suspend approval of the marketing of the relevant drug based on an effective judgment of the court.
Applicants for drug marketing authorizations (DMAs) and relevant patentees or interested parties may also request administrative adjudication from the CNIPA regarding patent disputes related to the drug under registration. Interested parties refer to patent licensees and relevant DMA holders.
If a patentee or an interested party fails to file a lawsuit with the court within the time limit specified in the linkage measures, the DMA applicant may file a lawsuit with the court, requesting confirmation that the drug for which they are applying for registration does not fall within the scope of protection of the relevant patent.
If a patentee or an interested party knows or should have known that their asserted patent should be invalidated or that the relevant technical solution of the drug under registration does not fall within the scope of protection of the patent, and still files a lawsuit or requests administrative adjudication in accordance with the aforementioned circumstances, the DMA applicant may file a lawsuit for damages with the Beijing Intellectual Property Court.
Filing Litigation
Plaintiffs
The plaintiff can be the patentee or an interested party.
Interested parties include licensees under patent licenses and legal heirs to the patent. Among licensees under patent licenses, exclusive licensees can independently file a lawsuit with the court. Licensees under sole licenses can also file a lawsuit if the patentee does not file the lawsuit.
Instituting Lawsuits
The patentee or interested party (plaintiff) submits a complaint to the court with jurisdiction. The complaint should include basic information about both the plaintiff and the defendant, the cause of action, the claims, the facts, and the grounds for action. The plaintiff’s identity certifications, relevant evidence proving the validity of the patent and the existence of the defendant’s infringement, the power of attorney and the attorney’s identity certification documents (if an agent is appointed) must be also submitted.
Where the plaintiff is a natural person, the identity certification could be an ID card or a passport. If the plaintiff is a legal entity, the identity certifications could be copies, stamped with the official seal, of the business license and a legal representative certificate. Where the plaintiff is a foreign legal entity or a legal person in Hong Kong, Macao, or Taiwan region, the identity certifications could be its Certificate of Good Standing/Existence and the Certificate of Legal/Authorized Representative for the person who executes the power of attorney.
Where the plaintiff is a foreign legal or natural person, the plaintiff's identity certifications and power of attorney must be notarized and apostilled in the plaintiff's residence country/region. These notarized and apostilled documents must also be accompanied with a Chinese translation translated by a translation agency designated by the court.
Where the plaintiff is an enterprise or other organization or a natural person in Taiwan region, the plaintiff's identity certifications and power of attorney must be notarized by a notary agency in Taiwan, and a copy of the notarized documents will be sent by the Straits Exchange Foundation, and the Beijing Notary Association will issue a verification certificate of consistency between the original and the copy.
Where the plaintiff is an enterprise or other organization or a natural person in Hong Kong special administrative region, the plaintiff's identity certifications and power of attorney must first be notarized by a Hong Kong law firm designated by the Ministry of Justice of China, and then be reviewed and stamped with a special transfer seal by China Legal Service (H.K.) LTD. established in Hong Kong.
Where the plaintiff is an enterprise or other organization or a natural person in Macau special administrative region, the plaintiff's identity certifications and power of attorney must first be notarized by a Chinese notary public stationed in Macau by the Ministry of Justice of China, and then be reviewed and stamped with a special transfer seal by China Legal Service (Macau) Limited.
Docketing and acceptance
The court examines the complaint, the plaintiff’s identity certifications, evidence and other necessary documents submitted by the plaintiff. If the documents filed meet the relevant requirements for instituting a lawsuit, the court will docket the case and issue a notice of acceptance.
If the documents filed do not meet the requirements, the court will make a ruling not to accept the case. If the plaintiff is dissatisfied with the ruling, he/she/it may appeal.
Transmitting the complaint
After the court formally dockets the case, it will send a copy of the complaint to the defendant, and the defendant should submit a response within the specified time limit. If the defendant does not submit a response, it will not affect the trial of the court.
Evidence exchange
The plaintiff and the defendant exchange evidence and conduct cross-examination.
Evidence shall be presented in court and cross-examined by the parties. Evidence involving state secrets, commercial secrets and personal privacy shall be kept confidential. If it needs to be presented in court, it shall not be presented in an open court session.
Trial in court
The court organizes the parties to conduct a trial in court, to state facts and grounds, and conduct cross-examination, debate, and make a closing statement.
Mediation
During the trial, the court will actively guide the two parties to mediate, promote reconciliation, and resolve contradictions and disputes.
Suspension of Litigation
If the defendant in a case involving infringement of utility model or design patents requests suspension of litigation, he or she or it shall file a request for invalidation against the plaintiff's patent within the response period.
In a case involving infringement of utility model or design patents accepted by a court, if the defendant requests invalidation of the patent within the response period, the court shall suspend the litigation. However, the court may not suspend the litigation if any of the following circumstances exist:
(1) The search report or patent evaluation report provided by the plaintiff does not reveal any grounds for invalidating the utility model or design patent;
(2) The evidence provided by the defendant is sufficient to prove that the technology used by the defendant had already been publicly known;
(3) The evidence or grounds provided by the defendant in requesting invalidation of the patent are obviously insufficient;
(4) Other circumstances in which the court deems it inappropriate to suspend the proceedings.
If the court decides to suspend the proceedings, and the patentee or interested party requests that the defendant be ordered to cease the relevant acts or other measures be taken to prevent further expansion of the infringement damages, and provides a guarantee, the court may, upon review and confirmation that the request complies with the relevant legal provisions, make a relevant ruling at the same time as it decides to suspend the proceedings.
Where due to the obvious violation of the Patent Law, the description is unable to be used to interpret the claims, and the patent is therefore requested to be declared invalid, the court hearing the patent infringement case should generally order a suspension of proceedings. If the patent is not invalidated within a reasonable period of time, the court may determine the scope of protection of the patent based on the claims.
No Suspension of Litigation
In a utility model or design patent infringement case heard by a court, if the defendant requests invalidation of the patent after the expiration of the response period, the court shall not suspend the proceedings, unless it deems it necessary to do so after review.
In cases involving invention patent infringement accepted by the people's court, or utility model or design patent infringement cases where the patent has been upheld by the CNIPA, if the defendant requests invalidation of the patent during the response period, the court may not suspend the proceedings.
Conflicts of Rights
In patent infringement cases, accepted by the court, involving conflicts of rights, the legitimate rights and interests of the party who legally enjoys the rights first shall be protected.
Legitimate rights include the legitimate rights or interests enjoyed in relation to works, trademarks, geographical indications, names, corporate names, portraits, as well as the product names, packaging and decorations with certain fame, etc.
Comprehensive Review
For cases involving patent infringement accepted by the court, even when the patent administrative authorities responsible for patents have already determined infringement or non-infringement, the court shall still conduct a comprehensive review of the parties' claims.
Decision
If mediation fails, the court will try the case and make a judgment based on facts and law. The court will serve the judgment on the plaintiff and the defendant, and the judgment will state the court's judgment, such as whether infringement is found, the infringer’s liability, etc.
First-instance cases tried by the court under ordinary procedures shall be concluded within six months from the date of docketing. However, the review period for foreign-related litigation case is generally longer, about 1 to 2 years.
If the parties are dissatisfied with the first-instance judgment, they can appeal within the prescribed time limit.
If no party appeals within the statutory time limit, the first-instance judgment will take effect.
Civil Liability
In patent infringement disputes, the infringer's civil liability primarily includes ceasing infringement and compensating for damages.
Compensation for Damages
Determination of Compensation
Basic Rules:
The compensation for damages in patent infringement shall be determined according to the actual losses suffered by the rights holder due to infringement or the profits earned by the infringer due to infringement. If the actual losses of the rights holder or the profits earned by the infringer are difficult to determine, the compensation shall be reasonably determined by referring to the multiples of the patent licensing fee (or the royalties).
The compensation for damages shall include the reasonable expenses paid by the rights holder to stop the infringement.
Malicious Infringement:
For intentional patent infringement, where the circumstances are serious, compensation may range from one to five times the amount determined in accordance with the method described in the Basic Rules above.
Statutory Damages:
If it is difficult to determine the actual losses suffered by the rights holder, the profits earned by the infringer, and the patent licensing fees, the court may determine compensation of not less than CNY 30,000 but not more than CNY 5 million based on factors such as the type of patent, the nature of the infringement, and the circumstances.
Calculation Approach:
The actual losses suffered by the rights holder due to infringement can be calculated by multiplying the total sales volume reduction of the patented products due to infringement by the reasonable unit profit of the patented product. If the total sales volume reduction of the rights holder is difficult to determine, the total number of infringing products sold in the market multiplied by the reasonable profit earned for each patented product can be used as the actual losses suffered by the rights holder due to infringement.
The profits earned by the infringers due to infringement may be calculated by multiplying the sales volume of the infringing goods by the reasonable unit profit of the infringing goods. The profits earned by the infringer due to infringement are generally calculated based on the infringer's operating profit. For infringers whose sole business is infringement, the profits earned can be calculated based on sales profit.
When determining the profits earned by the infringer due to infringement, the court shall limit it to the profits earned by the infringer from the patent infringement; profits arising from other rights shall be reasonably deducted.
If the actual losses suffered by the rights holder or the profits earned by the infringer are difficult to determine, and there are patent licensing fees to refer to, the court may reasonably determine the amount of compensation by referring to multiples of the patent licensing fees based on factors such as the type of patent, the nature and circumstances of the infringement, and the nature, scope, and duration of the patent license. If there are no patent licensing fees to refer to or the patent licensing fees are manifestly unreasonable, the court may determine the amount of compensation in accordance with the relevant provisions on statutory damages based on factors such as the type of patent, the nature and circumstances of the infringement.
If the product that infringes on an invention or a utility model patent is a part or component of another product, the court shall reasonably determine the amount of compensation based on factors such as the value of the part or component itself and its role in generating profits of the finished product.
If the product infringing a design patent is packaging, the court shall reasonably determine the amount of compensation based on factors such as the value of the packaging itself and its role in generating profits of the packaged product.
If the rights holder and the infringer have legally agreed upon an amount of compensation for patent infringement or a method for calculating compensation, and they claim that the amount of compensation shall be determined based on that agreement in a patent infringement lawsuit, the people's court shall support that claim.
Reasonable Expenses:
If the rights holder claims reasonable expenses incurred to stop the infringement, the court may calculate these expenses separately in addition to the amount of compensation determined by the Patent Law.
Defendant's burden of proof:
In order to determine the compensation for damages, where the rights holder has tried his/her/its best to provide evidence, yet the books and materials related to the infringement are mainly in the hands of the infringer, the court may order the infringer to provide the books and materials related to the infringement. If the infringer fails to provide or provides false books and materials, the court may determine the amount of compensation based on the rights holder's claims and the evidence provided.
Punitive Damages:
If a plaintiff claims that the defendant intentionally infringed their lawful intellectual property rights and the circumstances were serious, and requests that the defendant be ordered to bear punitive damages, the court shall review and determine the damages in accordance with the law.
Where a plaintiff requests that the defendant be ordered to bear punitive damages, the plaintiff shall specify the compensation for damages, calculation approach and the basis of facts and grounds when instituting the lawsuit.
If a plaintiff adds a request for punitive damages before the conclusion of the first-instance court debate, the court shall accept it. If a request for punitive damages is added during the second instance, the court may mediate with the consent of the parties. If mediation fails, the parties will be informed to file a separate lawsuit.
When determining the amount of punitive damages, the court shall, in accordance with relevant laws, use the plaintiff's actual losses, the defendant's illegal gains, or the profits earned by the defendant from the infringement as the basis for calculation. This basis does not include reasonable expenses incurred by the plaintiff to stop the infringement. Where otherwise provided for by law, such provisions shall prevail.
If the actual losses, illegal gains, or profits earned from infringement referred to in the preceding paragraph are difficult to calculate, the court shall reasonably determine the damages by referring to the multiples of the licensing fees for the patent at issue, and use this as the basis for calculating the amount of punitive damages.
If the court orders a defendant to provide account books or materials, in its possession, related to the infringement, and the defendant refuses to do so without justifiable reasons or provides false account books or materials, the court may determine the basis for calculating the amount of punitive damages based on the plaintiff's claims and evidence. If the defendant’s acts constitute forging or destroying important evidence and obstructing the court from hearing the case, he or she or it shall bear legal liability in accordance with relevant regulations.
When determining the multiples of punitive damages, the court shall comprehensively consider factors such as the defendant's subjective fault and the severity of the infringement.
If a defendant has already been subjected to an administrative or criminal fine for the same infringement and the fine has been fully executed, and the defendant requests a reduction or exemption from punitive damages, the court will not support the request. However, the court may take all factors into consideration when determining the multiples of punitive damages.
Lawful Source Exemption
Where a person uses, offers to sell, or sells a patent-infringing product for production or business purposes without knowing that the product was manufactured and sold without the patentee's permission, he or she or it shall not be liable for compensation if he or she or it can prove the lawful source of the product.
“Without knowing” means that the person does actually not know and should not have known. “Lawful source” means that the product was obtained through normal commercial means, such as legal sales channels and customary sales contracts. Regarding lawful source, the user, offeror, or seller shall provide relevant evidence consistent with customary trading practices.
Appeal
If the parties are dissatisfied with the judgment of the first instance, they may appeal to the court at the higher level within the prescribed time limit. The appeal shall be instituted through the court of first instance. The appellate brief shall include the names of the parties, the names of their legal or authorized representatives; the name of the court of the first instance, the case number and the cause of action; the request, factual basis and grounds for the appeal.
Upon receipt of the appeal, the court of first instance shall serve a copy of the appeal on the adverse party, and the adverse party shall file a response within the prescribed time limit.
Upon receipt of the appeal and response, the court of first instance shall submit them to the court of second instance together with all the case files and evidence.
The court of second instance shall review the relevant facts and applicable laws of the appeal request.
The court of second instance shall try the appellate case in court. After reading the case files, investigating and questioning the parties, if no new facts, evidence or reasons are raised and the court believes that there is no need to hold a trial, it may not hold a trial.
The court of second instance shall, based on the ascertained facts and legal provisions, make a judgment or ruling to affirm the original judgment or ruling, modify or revoke the original judgment or ruling, remand the case to the original court for a new trial, or make a judgment or ruling in accordance with the law or after ascertaining the facts.
The judgment or ruling of the court of second instance is the final judgment or ruling which will take effect immediately after being served on the parties and has legal effect.
Retrial
Although the second-instance judgment is a final judgment, if the parties believe that the second-instance judgment is erroneous, they may consult a lawyer on whether to request a retrial.
If the following circumstances exist, the parties may request a retrial, but the second-instance judgment or ruling will not be suspended or stayed.
For a judgment or ruling that has already taken effect, if one of the following circumstances is met, the party shall apply to the higher-level court for a retrial within six months after the judgment or ruling takes effect or within six months from the date on which they know or should have known the circumstances listed in items (1), (3), (12) and (13) below.
(1) There is new evidence that is sufficient to reverse the original judgment or ruling;
(2) The basic facts determined in the original judgment or ruling lack evidentiary support;
(3) The main evidence for the facts determined in the original judgment or ruling is forged;
(4) The main evidence for the facts determined in the original judgment or ruling has not been cross-examined;
(5) The parties are unable to collect the main evidence required for the trial of the case due to objective reasons, and had applied in writing to the court for investigation and collection, but the court has not done so;
(6) The original judgment or ruling has indeed erred in the application of law;
(7) The composition of the trial organization is illegal or the judges who should have recused themselves according to law did not recuse themselves;
(8) A person without litigation capacity did not have a legal representative to represent him or her in the litigation or a party who should have participated in the litigation did not participate in the litigation due to reasons that cannot be attributed to the party himself/herself/itself or his/her/its litigation representative;
(9) the parties were deprived of the right to debate in violation of legal provisions;
(10) The judgment was made in absentia without being summoned by a subpoena;
(11) The original judgment or ruling omitted or exceeded the litigation requests;
(12) The legal document based on which the original judgment or ruling was made was revoked or changed;
(13) The judges have committed acts of corruption, bribery, favoritism, fraud, or miscarriage of justice when trying the case.
For applying for a retrial, a party shall submit the following documents to the Court:
(1) An application for retrial, which shall state: basic information of the applicant for retrial, the respondent and other parties in the original trial; the cause of action; the name of the original court, the case number of the original judgment at issue; the statutory circumstances for applying for a retrial and the specific facts and grounds; and the specific request for retrial.
(2) Identity certifications of the party applying for retrial (such as certificate of existence, certificate of legal/authorized representative);
(3) Power of Attorney (if an agent is appointed);
(4) The original judgment at issue;
(5) The main evidence and other materials reflecting the basic facts of the case.
The appellate court shall review the application for retrial within three months from the date of receipt. If the application meets the requirements, it shall rule to retrial; if the application does not meet the requirements, it shall rule to reject the application.
Declaratory Judgment of Non-infringement
Where a rights holder issues a patent infringement warning to another party, and the person warned or an interested party issues a written notice urging the holder to exercise the rights to sue, and the holder does not withdraw the warning or file a lawsuit within one month from receipt of the written notice or within two months from issuance of the written notice, the person warned or the interested party may file a lawsuit with the court requesting declaratory judgment that their actions do not infringe the patent.
Other Civil Lawsuits
In addition to accepting cases involving patent infringement disputes, declaratory judgment of non-infringement, applications for behavior preservation, applications for pre-trial cessation of patent infringement, applications for pre-trial property preservation, and applications for pre-trial evidence preservation, the people's courts also accept civil patent cases such as patent ownership disputes, patent contract disputes, disputes over passing off others' patents, disputes over the right of authorship of inventors/designers, and other patent disputes.
The procedures for these cases are similar to those of infringement disputes and will not be repeated here.
For patent-related matters, please send email to info@afdip.com or call +86 010-82730790. For trademark/litigation/legal matters, please send email to info@bhtdlaw.com or call +86 010-82737958.
Patent enforcement, patent infringement, civil lawsuit, civil litigation
