One of the first lines of defence in preventing the spread of counterfeit and imitation goods is to stop such goods from entering a country at the borders. Accordingly, IP rights owners should always consider using customs' services as a part of their enforcement programmes in South Korea. In particular, IP rights owners should actively assist Customs in seizure cases and conduct training sessions for customs officers to educate them about their brands.
Substantial efforts are being made by the South Korean government to turn the country into a regional Asian IP hub. The most recent effort involves creating the International IP Hub Court – a specialised court panel within the Patent Court which will decide patent-related appeals in English. To further encourage foreign IP owners to use the Patent Court as a hub for international IP disputes, the government is considering fully implementing the International IP Hub Court.
Pfizer has successfully enforced its patent covering a secondary use of its Lyrica product against 13 generic drug manufacturers in South Korea, and was awarded approximately KRW2.2 billion in damages. The court held that the patent was valid and found infringement on the part of the generic manufacturers. This is the first decision in South Korea in which a court has awarded damages for infringement by generic drug manufacturers of a second medical use patent.
The Korean Fair Trade Commission (KFTC) recently conducted another IP survey of approximately 70 pharmaceutical companies, seeking detailed information regarding their major products, patents and litigation disputes involving intellectual property in South Korea. While this survey is limited to pharmaceutical companies, the KFTC may decide to investigate and issue surveys in other industries in order to determine whether IP abuse is occurring in those areas as well.
The Seoul Central District Court recently granted a preliminary injunction against the sale of a banana-flavoured jelly product on the grounds of dilution, despite the fact that it did not infringe the plaintiff's registered trademarks for dairy products. The court found that the plaintiff's banana-flavoured milk product was a well-known source identifier. As such, the plaintiff had rights to its appearance even for non-milk products.
A new patent cancellation system has been enacted for patents registered on or after March 1 2017. Previously, non-interested parties could file an invalidation action against a patent within three months of the patent being registered (interested parties may file an invalidation action at any time). Now, non-interested parties may no longer file invalidation actions, but any party may file a cancellation action against a patent within six months of the publication date.
Several amendments to the Design Protection Act were recently published, including an extended grace period for applications, eased requirements for providing proof of priority and increased penalties for perjury before the Intellectual Property Trial and Appeal Board, falsely indicating that a design has been registered or applied for and fraudulently obtaining a design registration. The amendments will come into effect on September 22 2017.
In a recent decision that could have led to the severe shortening or elimination of nearly all existing patent term extensions (PTEs) for pharmaceutical patents in South Korea, the Patent Court emphatically rejected the challenges raised by generics against the existing PTE system and potentially affirmed the validity of the full term of extended patent rights of numerous innovator pharmaceutical companies.
An important amendment to the Unfair Competition Prevention and Trade Secret Protection Act was recently published. Under the new amendment, infringers that violate the 'dead copy' provision of the act may be subject to imprisonment for up to three years or a fine of up to KRW30 million. By introducing criminal penalties for violations of the dead copy provision, this amendment will make it less arduous and expensive for parties to enforce their rights against infringing products.
The Intellectual Property Office recently amended the Design Examination Guidelines, effective as of January 1 2017. The most notable of the amendments is that the creativity threshold for design registrations has been substantially lowered. Among other things, the amended guidelines make clear that if a product design is composed in a manner that has never been seen in the relevant field, it can be deemed as creative – regardless of whether it is composed of basic shapes or patterns.
Recent statistics show that the Patent Court is making efforts to strengthen patent rights and that it has been rendering more decisions in favour of applicants and patentees. In view of the Patent Court's efforts to take a more favourable stance towards patentees, applicants and patentees are encouraged to take these recent trends into account when establishing an overall strategy for patent prosecution, patent litigation and licensing in South Korea.
The Supreme Court recently affirmed without opinion an earlier high court decision which held that a bakery shop's general appearance (including its logo, outdoor signage and indoor layout) and other trade dress elements were protected under the Unfair Competition Prevention and Trade Secrets Act. This case is noteworthy as it is the first time that the Supreme Court has specifically recognised the protection of such rights in shop interior and outdoor decorations.
Since the pharmaceutical patent regulatory approval linkage system was implemented in 2015, generics have asked whether the first generic exclusivity provisions provide any meaningful benefit, given that there is theoretically no limit to the number of generics that can obtain exclusivity rights. At this point, it remains to be seen whether and how generics will seek to introduce changes to the patent linkage system to address this exclusivity issue.
Software inventions have traditionally been a hot topic in many jurisdictions, with some fundamental questions frequently raised and debated (eg, the eligibility of these inventions). South Korea is no exception. In particular, there have been various discussions regarding the scope of patentable subject matter and protection for software inventions (particularly regarding the online transmission of computer programs used in working software inventions).
New amendments to the Trademark Act recently came into force. Among other things, these comprehensive amendments eliminate the need to have legal standing to file a non-use cancellation action, remove the one-year bar against registering marks similar to expunged marks and clarify the limitations on trademark rights.
A South Korean court recently held that the use of the original trademarks on refinished golf balls by a refinisher constitutes infringement of the original manufacturer's trademark rights. This decision is a substantial victory for original golf equipment manufacturers, as resellers of used equipment can no longer rely on the original manufacturer's trademarks to sell products that have been refinished or refurbished.
The Korea Fair Trade Commission's amended Guideline Regarding the Unfair Exercise of Intellectual Property Rights recently came into force. The amended guideline has, among other things, changed the definition of standard-essential patents and amended the provisions regarding unfair licensing conditions. It is hoped that amended guideline will make the regulations regarding the exercise of IP rights more reasonable and thereby promote innovation.
The Seoul High Court recently rendered a significant decision that further clarifies the meaning of the 'catch-all' provision of the Unfair Competition and Trade Secret Protection Prevention Act (UCPA). The court explained that when considering a UCPA catch-all claim, the courts should evaluate, among other things, whether the subject 'output' is the result of considerable effort and investment and whether the defendant's acts violated fair commercial practices.
Two major amendments to the Patent Act were recently signed into law. The amendments include a number of important changes to patent procedures, including a new patent cancellation system, greater ease in proving patent infringement and damages and a shortened period for requesting examination.
The National Assembly recently approved a major amendment to the Trademark Act which will take effect on September 1 2016. This is the first comprehensive amendment to the act in 26 years and includes changes to filing restrictions, official fees and grounds for rejection.