Here are some of the key takeaways:
Reasons to register IP in China
Xiaolin Dang of Beijing
Sanyou explained that filings of IP rights in China
continue to increase, including copyright filings which he
described as "very, very important". Litigation is also on the
up, he said, though about 98% or 99% involves Chinese parties
(including Chinese subsidiaries of multinationals). This is
driving the government to improve the IP system, he said.
When it comes to litigation, Dang described China as
pro-patentee: costs are low (less than $150,000), cases are
quick, the risk of losing is low and injunctions are "almost
automatic". Attorney fees are recoverable.
While it is true that damages awards are low, he said that
there have been some higher awards recently, including one of
Rmb50 million and one of Rmb91 million.
From 2013 to 2016, the win rate for foreign plaintiffs in
the Beijing IP Court was 100% (there were 65 cases).
Speaking in Washington DC, Jeff Fougere of
HPE said that given the recent developments in the
law, China should certainly be considered as part of a foreign
filing strategy. Edmund Fish of Houlihan Lokey
added: "In many sectors other countries are worth more than the
US. You can’t have foreign filing strategies or
monetization efforts – you need global strategies.
The speakers also agreed that Chinese companies are becoming
more sophisticated in monetising IP, including through
licensing, acquisition and incentivisation. "Engineers love to
be recognised as inventors," said Fish, adding: "I have 25
patents in my name and it feels really good!"
Business methods and software in China
Yang Li of Lung Tin
discussed the patent amendments that came into effect on April
1, and in particular the impact on software and business method
patents. He noted that many of the top patent filers in China
are in the ICT field, and many applications relate to
inventions such as mobile phone apps and ticket purchasing.
The amendments are a dramatic shift, said Li, compared to
previous restrictions on business method patents. There is no
longer a need to "decorate" claims, he said, "but you must
draft the claim in its whole as a technical solution". He
provided a number of case studies showing how to state the
technical problem and technical effect in patent
Li also provided examples of software-related claims, based
on the example of a method for embellishing a user photo
(selfie) in a mobile device. "Our suggestion is to draft and
include all four types of method and apparatus claims in the
specification," he said, adding: "You can reduce claims to save
official fees and add them back in later."
In Washington DC, there was a discussion comparing US and
Chinese approaches to software and business method patents
while in Palo Alto there were a number of questions about
enforceability, filing strategies and damages.
Michelle Chen and Hui Wang of Chofn
discussed patentability in China, focusing on Articles 2, 5 and
25 of the Patent Law. Recent developments include the ability
to submit experimental data after filing and the option to
narrow the scope of the claim.
The speakers gave various examples of what is patentable and
what is not under the Patent Law: for example, "Discovery of
the photosensitive property of a silver halide" would be
excluded as a scientific discovery, but "Photographic film and
process to produce the film in accordance with this discovery"
would likely be allowed.
|South Korea and Japan
|Did you know South Korea is the
world’s most innovative country, according
to Bloomberg’s index? Rachel Lee of HPE
discussed its infrastructure, innovation environment and
the lessons for other countries at the Forum in
Hyoun Ja Park of FirstLaw provided tips for patent
prosecution in Korea, including how to speed up/slow down
examination, how to handle final rejections and how to
make the most of opportunities for amendment/divisional
application. Ultimately, 90% of cases are granted.
Hyun Sil Lee offered the opposite perspective: how to
challenge a patent. A recent development here is that ex
parte post-grant revocation became available for any
patent registered form March 1 2017, but it only applies
to lack of novelty/inventive step based on printed
publications not available at the time of examination, or
violation of the first-to-file rule. The other options
available are third-party observations, ex officio
re-examination and a patent invalidation trial.
The speakers agreed that the percentage of patents being
held valid by the Patent Court is increasing, possibly
caused by a more generous attitude towards inventive
step. That means you may need more evidence than in the
past if you want to challenge a patent
Obtaining and challenging patents were also the subject
of the question-and-answer session on Japan, which
featured Nicole Bigler, Yoshitaka Sonoda and Paul Tokeshi
of Sonoda & Kobayashi, as well as Abraham Mertens of
Arista Networks (in Palo Alto).
Sonoda said that the patent grant rate in Japan has
increased from 50% to 70%: "Getting a patent has become
much easier and once you get a patent right it is
stable." He added that examiners in Japan are responsive
to informal contacts
Options for attacking patents include oppositions and
nullity actions – though Tokeshi noted that in
every case where an opposition has failed, a later
nullity action has also failed.
There are important tactical considerations in Japan: for
example, JPO judges have technical expertise but most
judges do not, so that may affect your arguments. Straw
man filings are also popular as people don’t
like to be seen as an infringer and often
don’t want to fight.
The panel also discussed recent developments on employee
remuneration in Japan.
They also discussed the relative merits of invention,
utility model and design patents in China, and the different
criteria for each, and how to overcome potential objections
during prosecution and invalidation proceedings.
In Washington DC, Colin Rauffer of Boeing
described IP rights as "a shield not a sword" and said that
company strategies would vary based on industry, market and
competition. For Boeing, he said China filings are now
comparable to those at the EPO.
Patent and trade mark strategies
In a wide-ranging session on patent and trade mark
strategies, Sam Li of Wan Hui Da discussed the
Judicial Interpretation II of 2016. He said this aimed to
achieve a better drafted, better quality of patent: "It imposes
a duty on the patentee to draft clear claims. Anything added to
the claim will be outside the scope of protection."
Judicial interpretations are important, said Li, as case law
develops in China, especially in the new specialised IP courts.
One area where this is important is in the calculation of
damages, and the evidence required to show damages.
Brian Schar of Dextera Surgical discussed a
case study involving patents for phosphorous and blue LEDs, and
lessons for international patent strategies. He pointed to the
benefits of patent protection in China, including protecting
your market, low costs and ability to obtain utility models,
but pointed out that SIPO cannot be an international search
authority. For that reason, he recommended getting a search
report in Korea and making use of the PPH and accelerated
examination in the US.
Jamie Rowlands of Gowling WLG in China
agreed with other speakers that there is a strong workable
system for litigants in China, but added: "My
clients’ one gripe is enforcement of judgments.
The problem is the amount of defendants that don’t
pay the damages or don’t comply with injunctions.
Courts are trying to address that but there is a long way to
Citing recent examples of Michael Jordan and New Balance,
Rowlands stressed the importance of filing early for IP rights
in China, as well as obtaining and preserving evidence.
Rowlands also welcomed what he described as a "bolder"
approach to preliminary injunctions, apparent in the
Louboutin v Guangzhou Varteam Trade Co case over
The importance of evidence collection was echoed by
Jason Yao of Wan Hui Da, who pointed out that
there is no discovery in China and that evidence must in
general be notarised. He also commended alternative means of
action, such as administrative enforcement and Customs: "China
Customs may be the best in the world – and once they
seize the goods, that can be very good evidence to put before
court and it does not need notarisation."
Other weapons available to China’s judges
include black lists and travel restrictions on convicted
offenders. "Work with the government" and "work with attorneys
and investigators you can trust," were two of his tips.
In Washington DC, Ellen Szymanski of the US Chamber of
Commerce said that counterfeiting has doubled in the
past five years. "We need to talk to China about restructuring
the counterfeit economy," she said: "Our aim to get plan to
restructure counterfeit economy in next five-year plan."