Sino Legend Saga Ends at US Supreme Court

The future ain’t what it used to be. (Yogi Berra)

Earlier this January, 2017, Sino Legend lost its long battle to have an ITC decision excluding its products form the US market reversed by a Supreme Court denial of its cert petition.

As I noted previously, the case presented an unusual set of circumstances, where Chinese courts had found that there had been no trade secret theft occurring in China, the USITC had found that there was trade secret infringement in an exhaustive opinion, China’s Ministry of Commerce sought a rehearing en banc after Sino Legend lost on appeal at the Federal Circuit, and a petition for certiorari was lodged by Sino Legend to the Supreme Court.  Attached are some of the US Supreme Court legal documents, including:  the petition for certiorari  (September 30, 2016); the amicus brief   of the Ministry of Commerce (Nov. 2016); the brief of   USITC in opposition (Dec 6, 2016);  brief of party respondent SI Group in opposition (Dec 6, 2016); reply of petitioners (December 20, 2016); and the Supreme Court’s denial of cert (Jan 9, 2017).

In its cert petition, MofCOM sought a reversal not only of the Sino Legend case but ultimately of the legal principle underlying the Tianrui decision.    The Chinese parties noted that in Sino Legend there a determination that there was no infringement in the case as litigated in China for facts arising in China.  As MofCOM’s brief notes:

[MofCOM] is disappointed by recent actions of the ITC. In wrongly interpreting Section 337 of the Tariff Act to allow the ITC to bar imports into the United States based on alleged actions conducted, and adjudicated, wholly within the borders of China, the ITC has impugned the sovereignty of China and refused to accord the comity expected of a trade partner.

MofCOM’s amicus brief further states:

The displeasure of [MofCOM] with what has unfolded in this, and other, recent ITC cases involving alleged trade secret violations should not go unnoticed. In this matter, there is no dispute that the alleged actions occurred entirely within China, by Chinese citizens, while working at Chinese companies. The alleged acts of misappropriation  were first raised by Complainant’s Chinese subsidiary in China. Both criminal and civil proceedings were instituted in China for these alleged misdeeds. The alleged conduct and actors in question were ultimately vindicated. However, Complainant, unhappy with the failure of proof in China, sought institution of a Section 337 proceeding in the United States based on the same conduct already adjudicated in China. The ITC conducted an investigation, ignored the rulings in China to the contrary, and determined that not only could the ITC bar products based on this conduct, but also that some of Complainant’s justify a limited exclusion order of Petitioner’s product.

The Chinese media had regrettably inaccurately described this case when it was decided at the ITC as a big victory for China involving a finding of no infringement in the US and China; rather a limited exclusion order was granted by the ITC in lieu of a general exclusion order.  China’s Supreme Court had also picked up on this inaccurate description when it regrettably determined that was one of the top 10 IP cases for 2014.  This recognition was troubling also as the complainant in the Sino Legend 337 case had sought a retrial of its case in China, which was denied by China’s Supreme People’s Court two  years later, in 2016.

The differences in final results in the US and Chinese decisions may also be due in part to disparate emphases in trade secret adjudication, with Chinese courts emphasizing similarities of technology between the parties, and the US courts relying more on unfair access to the technology by the alleged misappropriator.  One lesson of this saga is that comity may be more challenging to apply in trade secret litigation, which remains a relatively unharmonized area of IP law among various countries, and which is further weakened by differences in civil procedure including the limited availability of pre-trial discovery in China and many other countries.

Justice Tao Kaiyuan and the Role of the Judiciary

MadameTaoMichelleLee

Justice Tao Kaiyuan of the Supreme People’s Court, who had been to the United States in 2015 delivering important speeches on rule of law, has recently published an article on “Giving Full Play to the Leading Role of Judicial Protection of IP Rights“ 充分发挥司法保护知识产权的主导作用”(Dec. 31, 2015).  The article is receiving considerable attention in China, as it was published by Qiu Shi, 求是(“Seeking Truth”), a bimonthly political theory published by the Central Party School and the Central Committee of the Communist Party of China.  The publication of the article appears to be timed with the release of the recent draft of the Patent Law Amendments, comments for which were due the day after publication (January 1).  The proposed patent amendments would strengthen the role of administrative agencies in IP enforcement, to the possible detriment of the judiciary.

The author of the article is no less important than its contents.  Madame Tao knows patents.  She was the former Director General of the Guangdong Patent Office and therefor once had “vertical” reporting responsibility to SIPO (see picture above taken by me of Madame Tao [on the right] with USPTO Director Michelle Lee taken in 2015).  Although the article was authored in her name, many in China were speculating that the article was approved by higher authorities – perhaps Zhou Qiang, the President of the Supreme People’s Court, with Madame Tao serving as an appropriate messenger.

The concerns about this draft on patent law enforcement are not that different from those in the earlier (2012) draft when I blogged in “Why the Proposed Amendments to the Patent Law Really Matter … and Maybe Not Just For Patents” that “the changes strike me as a rather sudden about face in China’s march towards better civil protection of IP.” Madame Tao takes this several steps further.

Madame Tao’s article is divided into three parts: (1) The important meaning of giving full play to the leading role of the judicial protection of IP rights; (2) The key factors that constrain the leading use role of judicial protection of IP; and (3) Key measures in giving full play to the leading role of judicial protection of IP rights.   Here are some of the points she makes:

Madame Tao refers back to the National IP Strategy and related documents, such as the Third Plenum, the NPC’s decision to establish IP courts, and the Action Plan for the National IP Strategy to underscore the well-established, leading role of the courts in enforcing IP.

Her article compares certain key elements of judicial protection versus administrative protection.  In her view, judicial enforcement can curtail abuses of administrative enforcement.  It also has other advantages.  It has clear rules.  It is transparent.  It can help establish guidance for businesses by establishing clear standards for similar disputes (a possible nod to efforts at developing case law/guiding cases).  Moreover, civil enforcement comports with notions of private ownership and the development of markets and creation of a fair competitive environment in China.  Madame Tao especially underscores the role of the courts in supervising administrative agencies.  As I have noted, this is also an important part of the foreign IP docket in China.  Madame Tao states that the judiciary should also actively guide administrative law enforcement in investigation and review of evidence, and determination of infringements.

Madame Tao also calls for greater coordination in administrative and judicial roles in IP protection, noting that administrative enforcement played an important leading role in the beginning of China’s IP enforcement environment.  Administrative enforcement has “in a short time met the need for building effective IP protection.”  However, the “growing maturity” of the judicial system has caused increasing problems in the coordination process.

Madame Tao also calls for specific policy initiatives, many of which are already underway.  She calls for greater deterrent civil damages, including by revising patent, copyright and unfair competition laws based on experience of the trademark law revisions.   She also suggests that a discovery system should be considered.  Civil and criminal divisions in IP should be unified.  She suggests that a specialized national IP court should be researched and promoted, and she calls for the unification of technical appellate cases, perhaps like the CAFC.  She also notes that the division between infringement and validity determinations in the courts in patents and trademarks should be addressed, and calls for improvements in the availability of provisional measures.

She calls for greater improvements in judicial protective measures, including in obtaining evidence and the convenience and effectiveness of remedies.  Among other specific judicial reforms, she also suggests exploring intellectual property case law, improving judicial accountability and developing judicial professionalism.  Finally, Madame Tao also calls for expanding international awareness by IP judges to better protect national interests and to increase China’s IP influence.

Altogether, a tour de force.

Here’s what her speech looks like in a machine-translated wordcloud:taowordcloud

 

 

 

IPR Outcomes in the 26th JCCT

Here are the IP outcomes of the 26th Joint Commission on Commerce and Trade, concluded early in November 2015 in Guangzhou.  The IP-related outcomes appear primarily in three different places in the JCCT outcome document, under “Competition”, “Intellectual Property Rights” and “Cooperative Dialogues and Exchanges.”

I have repeated below the outcome language in full, without the annotation that appears in the US Department of Commerce release on the subject, followed by my own “references” on the outcome to compare the text with recent developments in these areas.

The Chinese government version of the outcomes follows the US outcomes.

COMPETITION

China’s anti-monopoly enforcement agencies are to conduct enforcement according to the Anti-monopoly Law and are to be free from intervention by other agencies.

China clarifies that commercial secrets obtained in the process of Anti-monopoly Law enforcement are protected as required under the Anti-monopoly Law and shall not be disclosed to other agencies or third parties, except with a waiver of confidentiality by the submitting party or under circumstances as defined by law.

Taking into account the pro-competitive effects of intellectual property, China attaches great importance to maintaining coherence in the rules related to IPR in the context of the Anti-monopoly Law. China clarifies that any State Council Anti-monopoly Law Commission guidelines will apply to the three anti-monopoly law enforcement agencies.

The Chinese side clarifies that in the process of formulating guidance related to intellectual property rights in the context of anti-monopoly law, it will solicit comments from relevant parties, including the public, in accordance with law and policy.

References: SAIC’s IP Abuse rules, NDRC’s draft IP Abuse rules. Importantly, this outcome specifically recognizes the pro-competitive nature of promoting IP. As I said in my comments on the NDRC’s IP abuse guideline questionnaire, “Rather than seek to minimize IP rights through euphemisms such as “balance” perhaps a better approach would be how to optimize the patent system to foster long term innovation and competition and insure that the competition system supports and does not retard such development.”

INTELLECTUAL PROPERTY RIGHTS

Standards and Intellectual Property

The United States and China affirm the beneficial role of standards in promoting innovation, efficiency, and public health and safety, and the need to strike an appropriate balance of interests of multiple stakeholders.

The United States and China commit that licensing commitments for patents in voluntary standards are made voluntarily and without government involvement in negotiations over such commitments, except as otherwise provided by legally binding measures.

The United States confirms that Chinese firms participate in the setting of voluntary consensus standards in the United States on a non-discriminatory basis, consistent with the rules and procedures of the relevant standards organizations. China welcomes U.S.-invested firms in China to participate in the development of national recommendatory and social organization standards in China on a non-discriminatory basis.

With a view to enhance mutual understanding and trust, the United States and China agree to hold dialogues over issues under this topic.

Here are some other blogs on this important topic.

Trade Secrets

The United States and China are committed to providing a strong trade secrets protection regime that promotes innovation and encourages fair competition.  China clarifies it is in the process of amending the Anti-Unfair Competition Law; intends to issue model or guiding court cases; and intends to clarify rules on preliminary injunctions, evidence preservation orders and damages. The United States confirms that draft legislation proposed to establish a federal civil cause of action for trade secrets misappropriation has been introduced in relevant committees. Both sides confirm that IP-related investigations, including on trade secrets, are conducted in a prudent and cautious manner.  The United States and China agree to jointly share experiences and practices in the areas of protecting trade secrets from disclosure during investigations and in court proceedings, and identify practices that companies may undertake to protect trade secrets from misappropriation in accordance with respective laws.

References: Note that the reference in the trade secret provision to a degree mirrors that of the Competition outcome, regarding protecting confidential information in administrative proceedings. Proposed revisions to the AUCL were previously discussed here.

Geographical Indications (GIs)

The United States and China will continue our dialogue on GIs. Both sides reaffirmed the importance of the 2014 JCCT commitment on GIs and confirmed that this commitment applies to all GIs, including those protected pursuant to international agreements. China will publish in draft form for public comment, and expects to do so by the end of 2016, procedures that provide the opportunity for a third party to cancel already-granted GIs.

Reference: This commitment builds on the 2014 GI commitment in the JCCT. An important case involving enforcement of a trademark based GI for scotch whisky is discussed here.

Sports Broadcasts

The United States and China agree to protect original recordings of the images, or sound and images, of live events, including sports broadcasts, against acts of unauthorized exploitation, including the unauthorized retransmission of such broadcasts over computer networks, in accordance with their respective laws and regulations.  The United States and China agree to discuss copyright protection for sports broadcasts and further cooperate on this issue in the JCCT IPR Working Group and other appropriate bilateral fora.

References: Copyright protection for sports broadcasting has been discussed elsewhere in this blog, and is of increasing important to China as it prepares to host the Winter Olympics and wants to develop its sports leagues. In addition US courts have granted copyright protection to Chinese sports broadcasts in a recent case. Tencent has also signed an important licensing deal with the NBA to make content available online.

Enhanced Enforcement Against Media Boxes and Unauthorized Content Providers

Noting the challenges posed by new technologies to the protection of copyright, China and the United States will continue discussions and share respective experiences and practices on combating the unauthorized online distribution of audiovisual content made possible by media boxes.  China clarifies it is to enhance enforcement against such media boxes and the providers of unauthorized content in accordance with its laws and regulations.

Reference: A recent US media box case involving Chinese content is discussed here.

Online Enforcement

In order to address the civil, administrative and criminal enforcement challenges caused by the rapid development of e-commerce, as part of the JCCT IPR Working Group, China and the United States will enhance engagement and exchanges between U.S. and Chinese government IPR policy and enforcement officials, IP right holders, business representatives and online sales-platform operators, among other relevant stakeholders.  This engagement will cover current and anticipated challenges in protecting and enforcing IPR online by sharing respective practices, discussing possible improvements in each country’s systems, facilitating information exchange and training between our two countries, and increasing cooperation on cross-border enforcement.  The goal of this effort is to enhance existing legal and cooperative regimes among businesses, rights holders and governments in civil, administrative and criminal online IPR enforcement.  Appropriate criminal matters will be referred, if necessary, to law enforcement agencies through the Joint Liaison Group (JLG) IP Criminal Enforcement Working Group or domestic law enforcement officials.

References: there have been numerous Chinese domestic efforts to deal with on-line infringement, including copyright-related campaigns, and an important role for Chinese Customs.

COOPERATIVE DIALOGUES AND EXCHANGES

Searchable Database for Intellectual Property (IP) Cases

The United States welcomes that the Supreme People’s Court has established a database for searching intellectual property-related court decisions.  In order to increase the understanding of each other’s legal systems, the United States and China agree to dialogue and to share experiences on their respective databases containing IP cases.

References: Whether or not China is developing “case law with Chinese characteristics,” understanding how Chinese courts handle cases can help guide sound business decisions.

Bad Faith Trademark Filings

Given the importance of addressing bad faith trademark filings, both sides agree to continue to prioritize the issue of bad faith trademark filings, and to strengthen communication and exchange on this issue through existing channels.

References: This is a continuation of earlier efforts.

Copyright Legislation

The United States and China are to continue exchanges on the development of their respective copyright laws.  China clarifies that its Copyright Law is in the process of amendment and useful principles and interpretative guidance from the Supreme People Court’s 2012 Judicial Interpretation on Internet Intermediary Liability will be considered in the law, if appropriate and feasible.

The final judicial interpretation is available here. Here is a blog on the 2014 State Council draft of the Copyright Law revision, and a blog on a 2012 NCA draft.

Exchange on Intellectual Property Rights Legislation

Recognizing the success and experience of recent exchanges on IP legislation through the JCCT IPR Working Group, programs under the Cooperation Framework Agreement and other fora, as well as the desire of the United States and China to further understand recent developments in this area, the United States and China agree to exchange views on their legislative developments in IP and innovation including on pending reforms in copyright law, patent law, trade secret law (anti-unfair competition law), science and technology achievement law, etc., with relevant legislative bodies.

References: This is a broad commitment, with much legislative activity planned in China in areas such as trade secrets, copyright, patents and related regulations.

Protection of New Plant Varieties

The United States and China agree to hold exchanges on the protection of new plant varieties through bilateral meetings and other means to be determined.

References: China and Switzerland agreed to extend plant variety protections in the Swiss-China FTA.

Here are the outcomes involving IP fromon the Chinese side, from the MofCOM website(http://www.mofcom.gov.cn/article/i/jyjl/l/201512/20151201200026.shtml).  I have translated the title of the outcome only.

“特别301”报告 SPECIAL 301 REPORT

美方重申其承诺,将在“特别301报告”中客观、公正、善意地评价包括中国在内的外国政府,在知识产权保护和执法方面付出的努力。美方欢迎旨在加强中国知识产权保护的改革和行动,并承诺在2016年“特别301报告”中将强调中国政府在知识产权保护和执法方面采取的积极行动。

 恶名市场 NOTORIOUS MARKETS

美方重申其承诺,如果适当,将在“恶名市场”名单中客观、公正、善意地评估和认可外国实体,包括中国实体,在知识产权保护和执法方面付出的努力和取得的成绩。美方计划在2016年通过将利益相关方的异议期延长一倍,继续增加程序的透明度。美方将继续与中方就此事项进行讨论。

 

知识产权有效和平衡保护 EFFECTIVE AND BALANCED IP PROTECTION

考虑到《与贸易有关的知识产权协定》的原则和目标,美方和中方将继续就诸如有助于保护创新者免于恶意诉讼的相关政策进行交流和沟通,为创新行为提供积极环境。

 

知识产权合作 IP COOPERATION

中美双方确认知识产权保护在中美双边经贸关系中的关键作用。双方承认合作的益处,并认可合作构成了双方知识产权交流的基础,承诺进一步加强重要领域的深入合作,包括:

进一步加强中美商贸联委会知识产权工作组作为牵头协调知识产权问题双边论坛的作用。

继续高度重视中美知识产权合作框架协议的工作,包括2016年司法交流和将在中国举办的一项培训项目;在完成并对现有承诺项目进行审查后,在预算允许的前提下,考虑在框架协议下增加其他项目。

支持中国商务部在2016年第一季度举办的技术许可联合研讨会。

其他项目将根据个案原则进行组织。双方认识到中美双方,特别是美方,与一系列从事知识产权培训和技术交流的机构和私人组织合作,实施了广泛的项目策划工作。

 

加强在打击网络盗版方面的合作  STRENGTHENED COOPERATION IN DEALING WITH ONLINE PIRACY

为应对在美国涉嫌网络盗版刑事侵权案件影响中国权利人的情况,中美执法联合联络小组下设的知识产权刑事执法合作工作组在美国驻华使馆的联系人将负责接收中方行政部门转交的此类信息。

 

通过中美双边合作加强知识产权在企业中的利用和保护 USING BILATERAL COOPERATION TO STRENGTHEN IP UTILIZATION AND PROTECTION IN ENTERPRISES

认识到双边贸易与投资持续增长的情况,中美双方同意加强合作与交流,就各自国家知识产权保护和利用有关的经验数据进行研究,并在此领域采取具体行动或举办项目,以协助中美关于鼓励创新的决策,并帮助中美创新者、创造者和企业家更好地理解如何在各自国家创造、保护和利用知识产权。

 

深化和加强中美知识产权刑事执法合作 DEEPENING CRIMINAL ENFORCEMENT COOPERATION IN IP

在中美执法联合联络小组下设的知识产权刑事执法合作工作组机制项下,中美将继续就跨国知识产权调查开展合作。双方将确定共同合作的重点案件,就此类案件保持定期沟通和信息分享,并探索在共同感兴趣的领域开展技术交流的机会。

 …

中美共同打击网络销售假药 JOINT SINO-US COMBATTING OF ONLINE COUNTERFEIT MEDICINE SALES

中美两国政府都非常重视打击网络销售假药以保障公共的用药安全和健康。两国食品药品监管机构之间已就打击网络销售假药开展合作,并承诺未来继续开展合作。这种合作包括分享信息、分享提高公众对网络销售药品认知的最佳实践以及加强在现有国际组织活动中的沟通与协调。

Updated: December 2 and 3,  2015

 

2014 Judicial IPR White Paper Shows Huge Growth in Trademark Appeals

It is IP week and for IP data geeks like me, China is publishing huge amounts of data in a short period of time.  The biggest challenge isn’t collecting the data, but in understanding what the data says and doesn’t say.

I have reported for several years now on judicial data that is released by the Supreme People’s Court (SPC) around this time.  The Beijing Intellectual Property Institute and other media released data from the SPC Court 2014 White Paper.  Here is a summary:

1.  IPR Cases Continue to Climb, Foreigners Continue to Play a Small Role.

The courts throughout China received 133,863 cases in 2014, and adjudicated 127,129 cases, increases of 19.52% and 10.82%, respectively.  Much of the increases were due to increases in civil copyright cases and administrative trademark cases.

Patent infringement litigation filings increased to 9,648  or 4.93%;trademarks decreased to  21,362 for a decrease of  8.21% and copyright increased to 59,493 cases, or an increase of 15.86%.  Technology contracts increased to 1,071 or an increase of 12.86%;anti-unfair competition cases (which include trade secrets) increased to 1,422 (of which there were 86 civil antitrust cases) with an increase of 9.22%.     Filings of second instance appeals increased to 13,760 cases, or by 15.08%.

Foreign related civil cases increased by a meagerly 0.11% to 1716 cases, or are now a 1.8% of the civil IPR docket, down from last year’s 1.9%.   Hong Kong/Macau/Taiwan cases dropped to 426 cases, or by 11.8%.

2.  Administrative Cases Continue to Climb, Affecting the Beijing IP Courts Docket and Being a Focus of Foreign Rightsholders

Foreign-related administrative cases, which principally consist of appeals of patent and trademark office decisions to grant or deny patent or trademarks, showed a dramatic increase, to 9,918 cases filed and 4,887 adjudicated, with a jump of 243.66% and 68.46% respectively.  Patent cases declined 11.67%  to  539.  However, new trademark cases increased by 330.59% to 9,305, an increase of 330.59%.  There were also 12 copyright administrative cases filed, and 62 administrative cases of other types.

There was overall an increase of 70.5% in foreign related administrative cases (including Hong Kong, Taiwan and Macau) to 2247 cases.  Foreigners represented 45.77% of the total administrative docket.

3.  Criminal Cases Continue to Grow

New criminal IP cases filed in 2013 totaled 11,088, an increase of 18.83%. Appeals numbered 573 cases, a decrease of 13.44%.

Conclusion –

As I noted back in December, the Beijing IP Court continues to be the most important court for foreigners.  In addition the court was facing an “explosion” in trademark civil litigation, which is re-directing the courts resources.

In the past declines in patent administrative litigation, such as occurred in 2014, have been associated with the busy dockets of the court which has resulted in low “reversal rates” by the courts due to the amount of time needed to properly reverse SIPO.  This may indeed be the current situation. I recently heard Chief Judge Su of the Beijing IP Court talk about the busy docket his court is facing.  I suspect that the rapidly increasing trademark docket has resulted in the Beijing IP court focusing on disposing of its trademark docket, as SIPO reversals are more time consuming.  This may have resulted in a decline in patent administrative litigation.  In any event, the decline in administrative appeals to the courts in 2014 is not attributable to any decline in patent filings, which increased by 12.5% in 2014 to 928,000, or any decline in civil patent litigation, which as I noted, increased as well.

I am waiting for more specific data on civil or criminal trade secret cases, as the summaries I have read do not break out trade secret cases from other anti-unfair competition law cases.

As in past years, foreigners continue to play an important role in administrative IP litigation while their role in civil IP litigation continues to be a small percentage of a large docket.  The growth in criminal IP cases, however, also suggests greater opportunities for rightsholders and foreign governments to cooperate on IP cases, including transborder IP cases.

Here’s a link to the 2014 White Paper on the WIPO website (中国法院知识产权司法保护状况 [2014]).

Civil, Criminal and Administrative IP Litigation Continued in Climb in 2014

China’s Supreme People’s Court and Supreme People’s Procuratorate released a summary of their IP-related activities as part of their annual work report to the National People’s Congress.

As reported by the Beijing Intellectual Property Institute (www.bipi.org), here’s a quick summary of the numbers:

The total numbers of cases adjudicated by the SPC in 2014 was 9,882,000, an increase of 1.7% over 2013.  Amongst those cases there were 5,228,000 civil cases, with an overall increase of 5.7% from 2013.  There were also 131,000 administrative cases, with an increase of 8.3%.  The total number of IP cases of all types adjudicated by the SPC was about 110,000, an increase of 10 percent.

In a separate 2014 annual report, the SPC noted that there were 94,501 civil IP cases adjudicated in 2014 (about 1.8% of the civil case docket).  In addition, there were 10,303 IP adjudicated criminal cases (about .2% of the criminal docket), and 4,887 administrative cases (3.7% of the administrative docket).

The relatively low numbers of IP cases compared to China’s overall dockets and the changes that the IP system has brought to China’s judicial system in areas such as specialized IP courts and preliminary injunctions, demonstrates the out-sized influence on China’s judicial system.

The SPP’s report indicated that total prosecutions for trademark, patent, copyright, and trade secrets involved 9,427 people, an increase of 7.1% over last year.

More details should be available by the end of April, when numerous Chinese agencies release reports on their IP work for the year.

SPC’s Annual Report Gives A Passing Nod to IP

SPC President Zhou Qiang issued his 2015 Report on the Work of the the Supreme People’s Court to the National People’s Congress recently, and IP didn’t get much of coverage. However the IP cases continued to climb – by about 10%.  More data is usually released around April 26 – World IP Day.

The principle paragraph devoted to IP, which curiously links IP to antimonopoly law is:

加大知识产权司法保护力度。  依法制裁侵犯知识产权和制售假冒伪劣商品行为,维护公平竞争的市场秩序,保护知识产权,促进创新驱动发展。  各级法院审结一审知识产权案件11万件,同比上升10%。  审结奇虎与腾讯公司涉不正当竞争案和垄断案,促进规范互联网领域竞争秩序。 

”Increase judicial protection of intellectual property rights. Sanction IPR infringement and selling counterfeit and shoddy goods according to law, and maintain fair and competitive market order and protect intellectual property rights, and promote innovation-driven development. Each level of IPR courts of first instance concluded a total of 110,000 cases last year, which was an increase of 10% over the prior year. We concluded the case involving Qihoo and Tencent involving unfair competition and monopoly, and promoted order in the area of Internet competition.”

In addition, President Zhou noted amongst the year’s accomplishments:

设立知识产权法院。  根据全国人大常委会的决定,在北京、上海、广州设立知识产权法院,审理知识产权民事和行政案件,落实国家知识产权战略,发挥司法保护知识产权的重要作用.

“Establishment of IP courts. According to the decision of the NPC Standing Committee, we set up intellectual property courts in Beijing, Shanghai and Guangzhou to hear civil and administrative cases of intellectual property rights, to implement the national intellectual property strategy, and play an important role in the judicial protection of intellectual property.”

Another interesting element: China handled 2,872,000 commercial cases last year, of which only 5,804 involved foreigners. In addition, the Chinese courts handled 6,014 cases of international judicial assistance. It appears that foreigners in all areas continue to play a relatively small role in China’s commercial litigation.

Susan Finder did an excellent blog on the report: “Supreme People’s Court president says court reforms in “deep water area.”

Draft JI Issued by SPC for Action Preservation Measures in IP and Competition Law Matters

On February 26, the Supreme People’s Court published for public Comment a draft SPC Judicial Interpretation on Concrete Issues in Application of Law in Determination of Action Preservation Measures in Intellectual Property and Competition Controversies (最高人民法院关于审查知识产权与竞争纠纷行为保全案件适用法律若干问题的解释)(征求意见稿). Comments are due Mach 30.  The SPC also issued an accompanying explanation of the draft JI.

When final, this JI will supersede prior JI’s involving preliminary injunctions in patent and trademark cases, which also served as reference for copyright matters.  The JI also further solidifies the extension of the civil procedure law reforms involving provisional measures to trade secrets, while also clarifying its expansion to civil competition law matters. The JI may open up the possibility of greater use of the civil courts for antimonopoly law litigation.

“Action Preservation” measures in the draft include measures to require a party to act by the court, or to prohibit them from acting. The draft JI specifically clarifies the circumstances by which licensees (exclusive or non-exclusive) may seek injunctive relief.   The time frame for rendering a preliminary injunction decision is a non-emergency matter may be as long as 30 days.  The draft JI also details such aspects of preliminary injunctions as the jurisdiction of the court, what constitutes “irreparable harm”, nature of guarantees, handling of appeals of cases and handling of oppositions to provisional measures, the effect of changed circumstances, fees, and other matters.