Semiconductor Patent Litigation Part 2: Nationalism, Transparency and Rule of Law

spindel

“The 60-year-old Yin Zhiyi (Gerald Yin) resolutely gave up the US’s annual salary of one million dollars, broke through the layers of US government review, … He led a team of more than 30 people back to China. … At the age of 60, he returned with his brain and founded China AMEC.

He said: We have done a lot of things for foreigners. It is time to make contributions to the people of our own country. He not only returned alone, but also led a team of outstanding Chinese of more than 30 people. It can be said that everyone has their own high-end technology weapons. And this move by him immediately caused the U.S. security department(s) to block him…  All the process and design drawings were completely confiscated.”

In my last blog I noted how semiconductor chip 芯片-related patent cases have a relatively low level of success in China, and that there appear to be wide regional variations in success rates.  Today, I will look at some of the legal issues raised by the emergence of Fujian as a venue for litigating these cases.  We begin by looking at the saga of Advanced Micro-fabrication Equipment, Inc. (AMEC), a semiconductor equipment manufacturer based in Shanghai, of which Gerald Yin, the subject of the above article, is both chairman and CEO.

AMEC has been described by the U.S. government as China’s leading semiconductor equipment manufacturer.    It has also been involved in three high profile IP disputes with US companies since its establishment.  Gerald Yin was a long-timer in Silicon Valley, previously served as a Vice President of Applied materials before joining AMEC, and prior to Applied he was with Lam Research and Intel – a scenario not unlike other Silicon Valley tech employees.  According to an on-line bio, he holds a doctorate in Physical Chemistry from UCLA and is the inventor of 86 US patents and more than 250 foreign patents.  AMEC’s case against Veeco earlier this year appears bears many similarities to the facts noted in the media report of a preliminary injunction decision issued on July 3, 2018 in favor of UMC and Fujian Jinhua’s case against Micron, another American company, also in Fujian province.

AMEC’s Batting Average

The records regarding AMEC’s prior legal challenges are complex and scattered across multiple jurisdictions.  They include court cases, patent filings, patent oppositions and Customs actions. It is frankly beyond the scope of this blog to fully analyze the validity of each claim and counterclaim.  Overall AMEC appears to be enjoying a high win rate.

The reported legal saga begins when Applied Materials sued AMEC in California (2009) for misappropriation of trade secrets that related in part to confidential information he obtained while at that company which were also the subject of patent applications by him.  The case was dismissed in favor of AMEC on the basis that the contract regarding the inventions violated California law against enforceability of non-compete agreements, depriving Applied of any rights to inventions whether or not there had been a misappropriation of confidential information.  Also of note, in 2009, AMEC brought suit against Applied in Shanghai, under the anti-unfair competition law (AUCL), presumably for trade secrets, which was withdrawn on January 1, 2010.  Withdrawn cases permit the parties to refile later as no decision has been reached on the merits and may not be included in official case law databases.

Another case involved AMEC and Lam Research, another Silicon Valley company which was also Gerald Yin’s former employer.  This matter involved patent infringements and was litigated in Taiwan.  By 2012 Lam Research had exhausted its appeals and lost.

AMEC v Veeco

AMEC’s most recent dispute with Veeco, a New York-based competitor with a subsidiary in Shanghai, involved preliminary injunctions for patent infringement in the US against a supplier to AMEC and a preliminary injunction in China against Veeco, as well as Chinese Customs seizure of imported goods of Veeco that infringe Amec’s Chinese patent. Preliminary injunctions in patent cases have historically been quite rare in China.  For example, in 2013, Chinese courts granted 11 preliminary injunction requests out of 90,000 IP cases. According to press reports, the dispute between Veeco and AMEC ended with a global settlement.

The US action was commenced on April 12, 2017 in the Eastern District of New York against one of AMEC’s suppliers, SGL.  Limited discovery was conducted in July and October 2017.  The 76 page opinion of Judge Chen, dated November 2, 2017 and amended November 16, 2017, reviews the challenges to patent validity, the scope of infringement, extraterritorial issues and the balance of equities in issuing a preliminary injunction against SGL (the drawing above is excerpted from her opinion).  Chinese commentary suggests that Judge Chen did not have the benefit of the Chinese validity challenges based on on novelty or non-obviousness.  However, the issues, including an alleged pre-existing “hockey puck” design are discussed at length in Judge Chen’s opinion, and there appears to have been discovery, expert opinion and due process provided (see text at fn. 64 and references to “hockey puck”).

Note that on January 23, 2018, SIPO declared the counterpart patent(s) to those asserted in New York to be invalid.   Of particular concern in the NY litigation was the ‘769 patent, formerly owned by Emcore.  AMEC reportedly launched an invalidity challenge at the USPTO on December 8, 2017 against this patent.  A Chinese author’s description of the global patent challenges is found here.

The second significant decision involved a case initiated by AMEC against Veeco in July 2017. and the Fujian High Court granting an injunction on or about December 7, 2017 (see media reports). This case has not been released to the public.  I have therefore had to rely on various secondary sources of information in order to understand the circumstances of this case.

A Veeco press release states that “On December 7, 2017, without providing notice to Veeco and without hearing Veeco’s position on alleged infringement, the Fujian High Court issued a ruling, applicable in China, that requires Veeco Shanghai to stop importing, making, selling and  offering to sell Veeco EPIK 700 model MOCVD systems which contain the accused infringing synchronous movement engagement mechanism covered by AMEC utility model patent ZL 201220056049.5 and wafer carriers used as supplies for the EPIK 700 MOCVD system.” The circumstantial circumstances seem to support this position.  According to AMEC’s press release, the patent in suit was the subject of two invalidity challenges and was held valid by the Patent Reexamination Board on November 24, 2017.  This was the Friday of the US Thanksgiving holiday.   The patent in suit was a utility model patent, ZL201220056049.5.  Assuming that AMEC moved for a preliminary injunction on the following Monday, November 27, 2017, the injunction would have been issued approximately nine business days later, hardly time for a thorough consideration of infringement issues or the weighing of factors in a preliminary injunction.  The Chinese preliminary injunction case was different from the US case in many respects: notably the US decision was published, involved months of hearings and exchange of documents, and the decision was not issued on an ex parte basis.  I assume it would also be difficult for the Fujian High Court to issue as lengthy a decision as EDNY in light of the limited time it had before it rendered its decision, but we lack the benefit of a published decision in this matter.

AMEC v Veeco also shares other concerns with Chinese countersuits against overseas litigation.   Although this case was filed after Veeco filed its case in the United States, the court seemed intent on accelerating its decision making in order to undercut the effect of a US judgment.  As I have noted, this is typically done without any consideration of comity, and it is a common litigation tactic for a Chinese defendant to seek a quick decision from a court where it has a close relationship to undermine the effectiveness of an overseas litigation or 337 investigation.  It is hard to deny that the Fujian High Court is paying attention to timing when the Fujian High Court apparently drafted its non-public decision in less than two weeks.

There are some other similarities with Chinese anti-foreign suit litigation, including that often these cases also end up getting recognized as a “top 10” /guiding/leading cases  by local or national authorities and the authorities extol how they can help guide Chinese companies to break open foreign markets, thereby adding fuel to a techno-nationalist fire.

Another strategic point is that AMEC’s principle weapon was a Utility Model Patent (UMP), which lasts only 10 years.  The use of utility model patents or design patents to countersue in China is a well-established practice (Chint v Schneider; Chery v General Motors).  One reason may be that UMP’s do entail a lower threshold of inventiveness than an invention patent and for that reason may be harder to invalidate.  In a sense, AMEC’s “high tech” weapon was the lowest tech patent weapon in the toolbox.   For a utility model, the invention must possess “a substantive feature and indicates an advancement”.  An invention patent requires “a prominent substantive feature and indicates remarkable advancements” (Patent Law, Art. 22).  Nonetheless, as has been evident for 10 or more years, UMP’s can have remarkable litigation value and should be considered a part of every foreign company’s patent portfolio for both defensive and offensive purposes.

The Customs proceeding is also a bit of an outlier, and also lacks any publicly available record.  While Chinese Customs has the authority to seize goods on import, and to seize goods that infringe patents, such seizures are rare.   The seizure by AMEC was also listed as one of Shanghai’s “top 10” IP cases for 2017, and the listing made it clear that the case should serve as an example for other innovative Chinese companies.

There are other unusual aspects to this case.  For example, why would a Shanghainese company (AMEC) file a case in Fujian against another company (Veeco) that is also locally headquartered in Shanghai?  Furthermore, why did they choose a jurisdiction which hasn’t seen one reported patent case with the word “chip” (芯片) in it?

Transparency Woes

The AMEC case now joins a short list of not-so-distinguished cases involving foreigners, where the court has yet to publish or significantly delayed publishing the final decision, including Huawei v Interdigital (Shenzhen first instance decision) and Chint v Schneider (Wenzhou).   This lack of transparency is striking considering the great strides generally being made in publishing court decisions.   Publishing decisions and other forms of transparency (such as amicus briefs) help ensure fairness, improve the quality of decisions, prevent corruption, develop appropriate legal strategies, and insure consistency with other legal opinions, amongst other benefits (as also noted elsewhere on this blog).

There may also be other explanations for this lack of transparency. The case was settled and, as noted, often decisions are not published after a case is withdrawn.  In addition, the case involved a preliminary injunction and such cases are just rarely published.  In the not too distant past requests for a preliminary injunction were handled exclusively by the “case filing division” of the courts and thus were never formally docketed. However, courts throughout China have been moving to limit the case filing division’s lack of transparency, and applied less discretionary “case recordal” acceptance procedures.  Fujian is no exception.  Non-publication leaves one guessing as to motives.

Added Motives to Be Non-Transparent?

Semiconductor companies are entitled to know more about Chinese and Fujian judicial practices in semiconductor patent matters, and what factors weigh in granting the rare preliminary injunction.  The news of July 3, 2018 that  the Fuzhou Intermediate Court reached a decision involving Micron’s alleged infringement of semiconductor patents, and that this case has apparently been released to the plaintiffs but has not yet been provided to the defendant, underscores the need for transparency (See press reports of Jinhua, UMC and Micron).   Also of concern is that the decision, which reportedly has immediate (立即 ) effect, was released the day before a US national holiday, July 4.  Generally preliminary injunctions are not effective until served, but time is likely of the essence in responsing to this order.  See also TRIPS Agreement Art. 41.3 (“3.  Decisions on the merits of a case shall preferably be in writing and reasoned. They shall be made available at least to the parties to the proceeding without undue delay.”)

Another concern amongst the foreign business community, given the current trade climate, is whether China has begun using legal tools to retaliate against US companies in sectors targeted by “Made in China 2025”, including retaliation against efforts to use overseas litigation.   The Micron decision comes less than two weeks after a promise that Beijing would not seek retaliation against foreign companies operating in China.  China’s increasing involvement in the semiconductor sector was described by former U.S. Commerce Secretary Pritzker in September 2016 as “unprecedented” state-driven interference that “distorts the market” and “undermine[s] the innovation ecosystem.”

One hopes that industrial policy is not affecting the legal system, as right now we need less, not more, fuel on the trade war fires.   Appropriately containing disputes to fair and expert legal systems can be one effective way of reducing trade tensions.

I welcome any commentary, corrections and updates.

The opinions expressed herein are mine alone.  In my capacity as an academic at Berkeley and as a lawyer or consultant, I do receive support from and advise semiconductor companies as well as service providers from time to time.  These comments were drafted solely in my academic capacity and without clearance or review by any company or association.

Revised 7/7/2018

 

 

 

Towards a Better Understanding of “Forced Technology Transfer” Policies in China and Their Strategic Implications

In August 2017, President Trump issued an executive order setting in motion an investigation of China’s trade policies including IP, technology transfer, and investment policies. The “Section 301” report on this investigation came out earlier this year. The Report itself uses the word “force” or “forced” 47 times and identifies a range of practices that result in “forced technology transfer.” However, there is a significant amount we still do not know regarding how these controversial Chinese policies actually work and the degree to which a technology owner’s behavior has in fact been compelled by state actors. A new paper by Dan Prud’homme, Max von Zedtwitz, Joachim Jan Thraen, and Martin Bader published in Technological Forecasting & Social Change explores this important issue.

The authors evaluate the ability of “forced technology transfer” (FTT) policies – which they define as policies meant to increase foreign-domestic technology transfer that simultaneously weaken appropriability of foreign innovations – to contribute to technology transfer. They draw on a survey of foreign firms, interviews with foreign firms, and case studies of Chinese firms.

The authors identify three categories of FTT policies that have significantly impacted foreign-Sino technology transfer in recent years:

(1) Policies which risk market loss (including market access preconditioned on meeting technology transfer requirements),

(2)  Policies that offer no choice regarding compliance (including unfair court rulings in IP civil litigation), and

(3) Policies that are based on legal obligations (including provisions in the technology import-export regulations; and certain policies related to the intersection of anti-trust and IP, and IP and technical standards).

Several other controversial policies were also identified, including disclosure of confidential business information through regulatory approvals, pharma patent issues, and certain tax schemes and subsidies.

The authors find that, with the exception of no-choice policies, foreign firms are allowed some flexibility to decide whether or not they want to comply with China’s FTT policies. Therefore, even though non-compliance with the policies is always met with consequences, the technology is not actually “forced” against a party’s will. After noting this limitation of the term, the authors explain that they retain the term “FTT policies” in their research for readability and because it is part of well-established lingo, but only use it to the extent that it meets their aforementioned definition.

Much of the research focuses on foreign-Sino transfer of frontier technology, i.e. the most advanced technology emerging from research and development which is generally not at the point of mass commercial adoption. According to the authors, not only the design of FTT policies per se helps determine if they exert substantial leverage over (i.e., force) frontier technology transfer, but the environment in which they are deployed is equally important. The authors find that FTT policies appear to exert the most leverage over frontier technology transfer when accompanied by seven conditions: (1) strong state support for industrial growth; (2) oligopoly competition; (3) other policies closely complementing FTT policies; (4) high technological uncertainty; (5) policy mode of operation offering basic appropriability and tailored to industrial  structure; (6) reform avoidance by the state, and (7) stringent policy compliance mechanisms.

Based on each of these conditions, the authors developed an FTT Strategy & Risk Forecasting Matrix with corresponding strategies the state may adopt to fully exploit, i.e. maximize the leverage of, FTT policies.

The authors’ analysis has several possible implications for technology transfer policymaking. In the authors’ view, Chinese FTT policies may enable domestic acquisition of frontier foreign technology if all seven conditions determining policy leverage are fully exploited by the state. However, if the state does not fully exploit all seven conditions, the FTT policies have less leverage. Moreover, if the state exploits none or only a few of the conditions, the FTT policies may result in a lose-lose game where foreign firms are discouraged from transferring valuable technology and domestic firms’ acquisition of new technology is made more difficult.

With this analysis, the authors provide evidence that can be used to appeal to the Chinese authorities to change some of their FTT policies: some of the policies are actually counterproductive in meeting their aims. The risks of loss of technology acquisition posed by Chinese policies is an important phenomenon which this blog has also identified, particularly as an unintended consequence of China’s Technology Import/Export Regulations (especially for start-ups and litigation-prone technologies, but also for technological collaboration) and which has been mentioned by the US Chamber of Commerce in its IP Index and its report on licensing.

The authors argue that in order to increase the chance that FTT policies will spur sustained transfer of frontier technology, Chinese regulators should not deprive foreign firms of  minimum level of appropriability. The policies should also allow foreign firms to benefit in at least minor ways from technology transfer arrangements.

The research also has important implications for technology strategy formulation and risk management. The authors’ FTT Strategy & Risk Forecasting Matrix can guide foreign firms to anticipate risks associated with FTT policies and serve as a starting point for understanding how to further quantify or mitigate these risks. The risks are of course compounded by potential trade secret theft, cyber intrusions, and less formal pressure points on foreign licensors to assign or transfer their technology in China. And these risks must be considered alongside major rising challenges to doing business in China, which Prud’homme and Zedtwitz have also discussed (in MIT Sloan Management Review), including: problematic areas of regulation in China and rising competition from Chinese rivals in terms of their recruiting and retaining top talent, more large-scale and strategic use of intellectual property, and ever faster time-to-market of products and services. Mitigating these many risks requires carefully integrated intellectual property, innovation, non-market, and human capital strategies, alongside yet other responses.

Edited of June 23, 2018:  An interview with Prof. Liu Chuntian of Renmin U. Law School on this same topic of forced technology transfer is found on page 2 of the People’s Daily (June 22, 2018, 2nd edition) (reporter Wang Yu)   A machine translation by Google is found here.  Liu focuses primarily on market access as a separate discpline from intellectual property under the WTO and as being essentially voluntary; he does not support formal and informal incentives in place (including the Technology Import/Export Regulations as noted in the article by Dan Prud’homme.

Edit of July 15, 2018: Here’s a link to Prof Prud’homme’s article outside of a paywall.  It may only be available for a short period of time.

March 13 – 19, 2018 Updates

1. China’s export of IP royalties increased 311.5% in 2017  According to the statistics of the State Administration of Foreign Exchange, the volume of trade of Chinese IP royalties totaled 33.384 billion USD in 2017, a 32.7 percent increase from 2016. The amount of exports of IP royalties totaled 4.786 billion USD, a 311.5 percent increase from 2016, which ranked No.1 in terms of the speed of growth in service trade. The exports and imports of IP royalties for manufacturing industry ranked No. 1, at 3.793 billion USD, a 544 percent increase from 2016.  The import amount totaled 20.753 billion USD, up 16 percent. In terms of category. The amount of exports of replication/distribution computer software ranked No.1. at 3.405 billion USD, up 652 percent from 2016. In terms of region, Guangdong province was the No.1 in amount of export and import of IP royalties in 2017. Its export amount totaled 4.013 billion USD, up 591.9 percent from 2016 and its import amount totaled 7.525 billion USD, up 9.8 percent from 2016.

Despite the significant increase in the amount of exports of IP royalties in 2017, China still has a trade deficit in IP royalties. The amount of the deficit totaled 23.812 billion USD, which increased by 0.978 billion USD. About 60% of the deficit reportedly originated from the United States, Germany, and Japan.

IP commercialization and utilization has been a focus of China’s IP efforts since the third plenum of the Communist Party in 2014. However, foreigners continue to view China as very challenging licensing environment despite China’s claims of a licensing “deficit”. China’s technology import/export regulations had been one of the challenges that foreigners expressed special concern. In the US Chamber’s recently released IP Index, it was noted that IP commercialization in China was hampered by “[s]ubstantial barriers to market access and commercialization of IP, particularly for foreign companies.” China received zero points for “Regulatory and administrative barriers to the commercialization of IP assets.”  Here is a link to the discussion of Chinese licensing practices. The US Chamber’s conclusion is not unlike that of the Global Innovation Index (2016) which, as we previously reported, scored intellectual property payments according to a formula as a percentage of total trade. China came out at 72nd place, while it ranked number 1 in high tech exports. Similar concerns were also voiced by USTR in the recently released Section 301 report.

2.SIPO takes efforts to develop ability and capacity of IP mediation entities.  SIPO recently issued a “Notice on Developing the Ability and Capacity of Intellectual Property Mediation Entities” (“Notice”), as part of its effort to strengthen the role of mediation in IP dispute and the overall IP protection system. According to the Notice, SIPO will select 20 to 30 existing IP mediation entities every year as the target for ability and capacity development and help with such development for two years. After the two-year period, SIPO will release the basic information as well as specialties of entities that made great progress. Selection and review of existing entities will start this year, which is done by SIPO. Entities can apply either through local IP offices or to SIPO directly.

Within the region, Japan is also considering the use of mediation system to resolve IP disputes. The Japan Patent Office (JPO) intended to introduce an ADR system to determine appropriate license fee of SEPs in 2017. However, the ADR SEP system is likely to be deferred, as reported after a JPO committee meeting in November 2017.

3.  Huawei v Samsung patent decision released by Shenzhen IP Court. The recent decision in Huawei v Samsung was released by the Shenzhen IP Court.  The case involves assertion of two SEP’s by Huawei, and the grant of an injunction against further infringement.

January 16 – 29, 2018 Update

Jan 16 – 29, 2018 

Here are some updates on IP developments in China from past two weeks.

  1. China criticizes US moves on intellectual property 商务部:缺少确凿证据无可信度 China on Thursday criticized recent moves by the U.S. targeting the sale of fake goods and Chinese telecoms equipment, saying Washington lacked “objectivity” in its approach to Chinese businesses. Commerce Ministry spokesman Gao Feng told reporters the U.S. Trade Representative lacked direct conclusive evidence and supporting data in listing three Chinese online commerce platforms and six physical bazaars within China as “notorious markets” engaging in commercial-scale copyright piracy and trademark counterfeiting. Meanwhile, Alibaba Group recently released a series of initiatives to strengthen its intellectual property rights protection. The event happened days after Taobao was put listed as notorious market. The ecommerce giant intends to gather as much information as they can and use the expertise of both brands and rights holder to create a much stronger database. It should effectively improve the algorithm that Alibaba uses to counteract the fakes and even gather evidence for offline investigations. Moreover, Preempting the 2017 USTR report’s publication by one day, the company has released the 2017 Alibaba Intellectual Property Protection Annual Report (in Chinese).
  2. Google announces patent agreement with Tencent amid China push Alphabet Inc’s Google has agreed to a patent licensing deal with Tencent Holdings Ltd as it looks for ways to expand in China where many of its products, such as app store, search engine and email service, are blocked by regulators. The agreement with the Chinese social media and gaming firm Tencent covers a broad range of products and paves the way for collaboration on technology in the future, Google said on Friday, without disclosing any financial terms of the deal. Additional articles are available here and here.
  3. China Publishes More Scientific Articles Than the U.S. For the first time, China has overtaken the United States in terms of the total number of science publications, according to statistics compiled by the US National Science Foundation (NSF). According to the report, China published more than 426,000 studies in 2016, or 18.6% of the total documented in Elsevier’s Scopus database. That compares with nearly 409,000 by the United States. India surpassed Japan, and the rest of the developing world continued its upward trend.
  4. SIPO Released Statistics Data on Major Work for 2017国家知识产权局公布2017年主要工作统计数据 SIPO recently released detailed breakdown of statistics on its work for 2017. Government data show that the number of annual applications for invention patents filed in the country topped 1.38 million in 2017, a 14.2 percent rise on the previous year. Beijing, Shanghai and Jiangsu are the top 3 provinces for number of patents per 10,000 people. State Grid Corporation of China, Huawei, and Sinopec are top companies with most patents granted.
  5. China’s trademark applications hit record high in 2017 China’s trademark applications exceeded 5.7 million last year, up 55.7 percent year on year, both setting record highs. At the end of 2017, China had 14.92 million qualified registered trademarks, the most of any country worldwide.
  6. “Jianwang [Swordnet] 2017” closed 2554 Pirated Websites“剑网2017”关闭侵权盗版网站2554个National Copyright Administration, State Internet Information Office, MIIT and Ministry of Public Security jointly held a conference on “Jianwang” special campaign recently. Since this special act being implemented in July 2017, 63,000 websites have been investigated and 2554 infringing websites have been closed. According to officer from National Copyright Administration, this special act had a focus on videos, news, mobile Internet applications (APP) and e-commerce platform.
  7. China Will Take the Lead in Promoting IP Protection Mechanism in Pilot Area我国将在全面创新改革试验区域推进知识产权保护改革率先突破 NDRC recently issued a notice to promote reform on IP protection mechanism in eight pilot areas, including Jing Jin Ji, Shanghai, Guangdong, Anhui, Sichuan, Wuhan, Xi’an, Shenyang. The government intends to promote integrated management of IP rights, explore new mechanism of IP protection, and establish a new mechanism to link administrative and criminal enforcement.
  8. U.S.-China IP Scholar Dialogue was Held中美知识产权学者对话举行 The Fourth U.S.-China IP Scholar Dialogue was held in Shanghai, China from January 17 to 18. Intellectual property is a key issue in the development of U.S.-China economic and trade relations. To increase cooperation and understanding, IP experts from both countries created this dialogue mechanism since 2013. This year’s dialogue emphasized on AI, biomedical innovation, technology licensing, trade secret law reform, IP judiciary protection and dispute settlement mechanism.
  9. US Commerce Secretary Ross says Beijing’s technology strategy is a “direct threat”; China demurs.  US trade authorities are investigating whether there is a case for taking action over China’s infringements of intellectual property, Commerce Secretary Wilbur Ross said. China responds that it did not expect more trade disputes.
  10. China Customs reports seizing infringing goods worth 552 mln yuan in past three years.   China has seized infringing goods worth 552 million yuan (86.06 million U.S. dollars) in the past three years driven by a special act called “Qingfeng” (“Clear Breeze”), according to the General Administration of Customs of China (GACC). The three-year crackdown on intellectual property rights infringement discovered about 120 million infringing items, according to the General Administration of Customs.  Compare prior discussion on previous reports of GACC hereand here.
  11. Beijing to set up IPR center to better serve high-tech firms.  Beijing will establish a center this year dedicated to providing services to high-tech companies on intellectual property rights (IPR), officials said. The center will offer fast-track services for patent applications to companies in information technology and high-end equipment production, two areas with the highest demand.  This is part of an existing SIPO effort to fast track areas of concern to industrial development.  Compare, however, article 27 of TRIPS Agreement – patents shall be available and patent rights enjoyable without discrimination as to the place of invention, the field of technology and whether products are imported or locally produced.
  12. SIPO released a directory of industries that need IP support.  SIPO recently released the 2018 Intellectual Property Supporting Industries Directory (知识产权重点支持产业目录(2018年本)), which identified 10 industries where IP will be key. The government asked for efficient allocation of IP resources within these industries to promote industrial restructuring and upgrading.
  13. China’s Sinovel Convicted in U.S. of Stealing Trade Secrets.  A Chinese wind turbine maker, Sinovel Wind Group Co. was found guilty of orchestrating the theft in a rare trial in Wisconsin that continues to raises doubts over China’s commitment to fighting infringement of intellectual property and corporate espionage.  The case is U.S. v. Sinovel Wind Group Co. Ltd., 13-cr-00084, U.S. District Court, Western District of Wisconsin (Madison). The conviction was against Sinovel Wind Group.  Previously a former employee of the victim had been found guilty of theft of trade secrets in a criminal case in Austria. In addition, there are in total five civil cases in China between Sinovel and AMSC, with one closed and four pending. AMSC filed one separate trade secret case in China plus two copyright cases and an arbitration.
  14.   Five New Guiding Cases (English translation available).  Of the five newly released GCs, four are administrative cases and one centers on a dispute over the infringement of rights related to a new plant variety (Case No. 92). English translation of those guiding cases are made available by the China Guiding Case Project of Stanford Law School. More information about previous guiding cases available here and here.

We hope to be providing more updates in the year ahead from UC Berkeley.  As usual, the information herein does not necessarily represent the opinion of any government agency, company, individual or the University of California.

Updated: February 13, 2018