ITIF, the Information Technology and Innovation Foundation (ITIF)—a Washington, DC-based technology and economic policy think tank is seeking a trade and intellectual property policy analyst. The analyst will work on a wide range of trade policy issues including assessing foreign countries’ “innovation mercantilist” policies. According to the position announcement, the analyst will work at the intersection of a range of intellectual property, digital, and trade policy issues, including copyright, patent, digital content, and digital trade issues. ITIF informs me that the position will involve “about 25%” China-related work. This position does not require legal training. Further details are available here.
As I noted recently, a Beijing district court recently decided that live broadcasts of sports events can be protected under China’s copyright law (June 30, 2015).
Only a few weeks earlier, a US district court decided in CCTV et al vs. Create New Technology (HK) Ltd. et al. (June 11) (Case No. CV 15-01869 MMM (MRWx) (C. D. Cal) (Morrow, J). that the pirated streaming of live and time-shifted CCTV and TVB (Hong Kong) channels through media boxes and apps on a peer-to-peer network and/or through servers in the United States to large numbers of users who had no right to access the content constituted copyright infringement. The CCTV and content covered by the court’s preliminary injunction included live news, sports, and television.
The U.S. case underscores the availability to Chinese plaintiffs of strong civil remedies in the United States, including preliminary injunctions. Although Chinese courts normally dispose of first instance cases in six months, this case was filed on March 13, 2015 and the preliminary injunction was granted June 11 – precisely 90 days later, not including the end date. In other words the preliminary injunction in this case was rendered in case involving foreign interests in less time than a Chinese court would have rendered its first instance decision in a domestic case (time frames are expanded if there is a foreign litigant).
Of about 90,000 civil IP cases in the Chinese courts in 2012, there were only 27 cases involving preliminary injunctions. By contrast, US courts are, by all accounts, more willing to grant provisional relief of all kinds. Judge Morrow, in her decision, noted that “unauthorized and uncompensated internet streaming that competes directly with the television programming of a copyright owner and its authorized licensees causes harm that is ‘neither easily calculable, nor easily compensable.’ ” She further stated that “given the extensive nature of the infringement alleged … it is unclear that defendants would be able to satisfy any damages award entered. This further supports the conclusion that injunctive relief is appropriate in this case.”
These two recent cases are positive steps in protecting broadcasts, including live sports broadcasts. The U.S. case is also a good guide post for Chinese courts looking to extend the availability of provisional remedies in civil IP adjudication for foreigners and Chinese alike, including in cases involving online infringement and live broadcasts.
On June 30, the State Intellectual Property Office posted a draft for comment of proposed national recommended standards for Intellectual Property Management for Research and Development Organizations and Intellectual Property Management for Higher Education. Comments should be submitted before July 28, 2015. The final recommended standards are to be adopted by the Standardization Administration of China (SAC). The drafts were prepared by SIPO, the Research Institute of SAC and the Chinese Academy of Sciences (for R&D), and the Ministry of Education (for higher education).
The R&D provisions are intended to govern national and local R&D institutions, as well as organizations which they have invested in and established (Art.1) and can be used for reference by other R&D institutions.
R&D organizations should have internal materials on their operations, including such matters as protecting trade secrets (Art. 6.4 of the R&D Standard), requiring staff working on core technologies to sign post departure IP agreements or non-compete agreements, rules for disclosure of IP-related information in scholarly materials including theses and dissertations, and procedures for IP-related contracts. Relatively simple rules for licensing (8.2.1) are set forth, which include: due diligence before licensing, confirming the effectiveness of the IP, and drafting of a written contract. Strategies for joining IP “alliances” are also mandated (8.3)
The Higher Education standard encompasses all types of higher educational institutions, including those who recruit students from the national entrance exams. It also covers all types of faculty, including full-time faculty and visiting faculty. It sets up an organizational structure for managing intellectual property within a university. Rewards are mandated for those who make a significant contribution, although specific amounts are not set forth (6.1.2).
Specific provisions are also made for creation of copyrighted works in the humanities and social sciences when works are made for hire (7.2)
Although these standards are general in nature, foreign entities may wish to become familiar with these standards when they enter collaborative research projects with Chinese institutions. In addition, the standards can help to inform visiting foreign faculty and students of their host institution’s expectations regarding IP. These procedures. once final, can also serve as useful reference materials for privately funded R&D efforts.
According to the Beijing Intellectual Property Institute (“BIPI”) (June 2015 newsletter) and other press sources the State Administration of Industry and Commerce (SAIC) had completed its draft revisions of the Antiunfair Competition Law (“AUCL”) at the end of May 2015, and is preparing to submit the draft to the State Council Legislative Affairs Office.
According to press reports, the research on the revision was done by a mixed team of academics and a provincial AIC, which spent a year working on eight separate research topics. Universities involved in discussing the draft included Peking University, Wuhan University and Renmin University.
This would be the first major revision to the AUCL since it was enacted 22 years ago. BIPI suggests that the two biggest changes are: (a) an increase in the types of conduct that constitute unfair competition, and an (b) increase administrative enforcement penalties.
The types of conduct covered have increased, notably to include anticompetitive online conduct, on the basis that these types of conduct are different from those found in traditional physical markets. Rather than elaborate on specific types of conduct one by one the new draft has included a prohibition against “conduct that is against commercial ethics ” to capture additional conduct that is not otherwise specified.
Depending on the type of infringing conduct, administrative enforcement penalties would be increased to between 1,000,000 and 4,000,000 RMB.
Finally, BIPI points out that the draft clarifies that the enforcement authority under the AUCL is the authority for supervising and investigating conduct arising under the AUCL and the draft AUCL also gives the SAIC additional power. This clarification, other press sources note, is intended to address conflicts arising under the existing law, where other agencies, such as AQSIQ, Ministry of Culture and Pricing Bureaus, had authority if separately specified under applicable law or regulations (Article 3 of the AUCL). The draft is intended to address a problem of the type that arose under the existing AUCL, such as a case involving Xinglong County in Hebei (河北省兴隆县工商局) where there was a conflict with the local AIC over the local telecommunications authority in its insisting that customers used services and equipment designated by it, which caused the local AIC to drop an investigation under the AUCL.
I have not personally had a chance to review this draft, although I did review a draft of several years ago. Based on the press reports, I have two areas of concern:
The press reports do not elaborate on changes in the law regarding trade secrets or trade dress, which are two of the IP rights that are covered by the AUCL that have long been subjects of discussion. Improved trade secret protection is also the subject of specific bilateral commitments. An early draft of the revisions of the AUCL also included provisions regarding regulatory data protection (which is a type of trade secret protection under TRIPS) for pharmaceutical products and agricultural chemicals, which are not mentioned in the recent reports. Increased interests in design protection by China, whether through design patents, applied art in copyright or through trade dress, would seem to be consistent with Chinese interests. Trade secret protection may also be incorporated into a revised civil code, which hopefully will address some of the weaknesses of the current law and its enforcement.
The revisions appear to adopt many proposals of other laws undergoing revision, including increasing administrative deterrence, expanding the roles of the administrative enforcement agency, increased attention to on-line enforcement and even a focus on commercial ethics which may not equally benefit IP cases. Particularly important for trade secret litigation, for example, will be providing more robust discovery, clear standards for evidence preservation and preliminary injunctions, and harmonization of the law with rules regarding labor mobility and non-compete agreements. I believe that more robust civil and criminal trade secret remedies are likely to bring more benefit than administrative trade secret remedies. Concepts of commercial ethics also parallel developments regarding practices to address bad faith prosecution practices in China’s trademark and patent offices. While the concept of commercial ethics is noble, we will need to wait to see how, if adopted, it will be specifically applied in trade dress and trade secret matters, as well as on-line issues, and if gaps in existing coverage or enforcement, which might include areas varied as inevitable disclosure, regulatory data protection or more robust trade dress protection, are addressed.
In a very positive development for Chinese football sports leagues, CCTV, Tencent, NBA, as well as Olympic and other international sports competitions in China, the Chaoyang basic level court in Beijing determined on June 30 that live broadcasting of a sports competition is sufficiently creative to be protectable under China’s copyright law in Sina v. iFeng（2014）朝民（知）初字第40334号). The case can be found here in Chinese. The key language of the case with my very informal translation is as follows:
In the present case the Internet company Sina raised an issue involving the presentation of broadcast screens (pictures) and their status as works under the copyright law. In accordance with the law, protected works must be original intellectual achievements that can be replicated in some tangible form. The key factor for this court in determining whether the broadcast of a live competition was original is the broadcast screen. Originality means independently created, which is to say that it does not imitate the work of others or is a copy.
In broadcasting a competitive event, from the point of view of the overall production, the event broadcast and record production involves shooting by setting several or several dozens of unfixed or fixed recording equipment as the basis to film and record to a final picture for the user or audience to see the final picture. However a fixed position does not mean a fixed picture. The picture that the user sees is not completely the same as taking place on the field, and it does not proceed completely or fully synchronized. This explains that the broadcast production process is not just a record of events, …
In this regard, although there is no provision on legal standards of originality, but it should be understood that the choice of lens for recording events, editing, a new screen for viewing the picture, is undoubtedly a creative work, and the creation of different options and different productions, will produce a different picture of the effect that precisely reflects its originality. The formation of the picture of the sporting event constitute originality under the Copyright Law of China and should be recognized as a work. From the perspective of this case, the picture screens presented satisfy the requirements of originality not only in their filming and production, but also in the auditory and visual style which thereby gives a final result of audio and visual sensations, thereby constituting a work.
The case may be appealed to the Beijing IP Court. Damages of 500,000 RMB were assessed, plus costs and an injunction.
Update from August 6, 2015: here’s the case in English language translation.
Update from March 11, 2016: Here’s a link to an article on a proposal by an official from Le TV to the NPC and CPCC on protecting copyright in sports broadcasts. The focus of the proposal is to strengthen sports competition intellectual property protection and promote the healthy development of China’s sports industries (“加强体育赛事知识产权保护 促进我国体育产业健康发展”). The first element of the proposal is to adopt the international standard of using copyright law to protect sports broadcasts as a “work”, which the author notes is available under US copyright law and has been recognized by nearly all European countries, according to a study from the University of Amsterdam (See Section 1.4.1).
How creative is the professional sports broadcast to merit copyright protection. The video below from an NFL game gives some indication of what is involved. (updated September 1, 2016 with this video).