Against the backdrop of China's changing IP landscape, the administrative enforcement of patents remains a valid option. Although local IP offices are being incorporated into the local administrations of market supervision, their patent enforcement function will remain intact. As such, judicial and administrative protection will likely dovetail in future to achieve complementary advantages. IP practitioners are therefore advised to tailor enforcement strategies to the circumstances of a particular case.
The Ouhai District People's Court in Wenzhou recently affirmed the significance of taking a global view when assessing the similarities between an allegedly infringing product and a 3D trademark. The dispute at issue was between Martell, one of the world's oldest cognac houses, and the Chinese manufacturer of Louis Baron XO brandy, the bottle of which was almost identical to Martell's 3D trademark.
In a recently published case, the Supreme People's Court reaffirmed that the reputation that a prior mark has built up may be extended to a later mark of the same applicant. However, the court categorically denied that a trademark registration can be extended to other marks through any means other than a renewal. This decision has rendered the widespread practice of extending a trademark registration obsolete.
The Office of the Inter-ministerial Joint Meeting for Implementation of the National IP Strategy recently promulgated the Action Plan for Furthering the National IP Strategy and IP Rights Powerhouse Initiative 2018. The action plan offers few new proposals and instead reiterates the major IP initiatives which the government has promoted over the past two years, including institutional and judicial reform, a legislative plan and various national enforcement campaigns.
In October 2018 the National People's Congress decided that all appeals of lower-court judgments rendered in cases with a technical aspect should be submitted to the Supreme People's Court (SPC). Following this decision, the SPC created a detached tribunal known as the SPC IP Court. It also promulgated the Provisions on Several Issues concerning the SPC IP Court, which set out how the new court will function and its jurisdiction.
The 13th National People's Congress Standing Committee recently concluded its sixth session and adopted the Decision on Several Issues concerning the Litigation Procedures of Patent and Other IP Cases. Among other things, the decision provides that first-instance judgments rendered in highly technical civil IP cases will be directly appealable to the Supreme People's Court.
In July 2018 the Supreme People's Court confirmed the Trademark Review and Adjudication Board's decision to invalidate the pre-emptive registration of the trademark 美图秀秀MEITUXIUXIU in Class 3. The court's verdict has put an end to the invalidation proceedings instituted by Xiamen Meitu Technology Co, Ltd against the disputed trademark and confirmed the well-known status of the cited trademark 美图秀秀 in Class 9.
The statutory limit for damages set out in the Patent Act is Rmb1 million, which is lower than the equivalent limit set out in both the Trademark Law and the Anti-unfair Competition Law. As such, it is becoming increasingly important in patent cases to convince the court that the prejudice is higher than the statutory limit. Stokke AS recently managed to do this before a Zhejiang court in a lawsuit against a patent infringer.
In 2017 the Beijing IP Court rendered a groundbreaking decision by awarding the owner of an unregistered well-known trademark Rmb3 million in damages for infringement. According to the Trademark Law (2013 version), the owner of an unregistered trademark can prevent a third party from registering or using an identical or similar trademark on the same or similar goods. However, the law is silent as to whether the owner of such a mark can seek damages from third-party users.
China's State Intellectual Property Office was recently renamed the National Intellectual Property Administration. Simultaneously, the activities of a number of government entities, including the State Administration for Industry and Commerce and the State Intellectual Property Office, were regrouped under the State Administration for Market Regulation. Since the government announced this plan, foreign brand owners have been wondering how it will affect the IP sector.
The Supreme People's Court recently held a public hearing on the retrial of the administrative litigation concerning the refusal of Parfums Christian Dior's international 3D trademark application. The case was far from simple and raised several procedural issues, including with regard to the definition and publication of an application's subject matter, the consistency of examination criteria and the treatment of solely 3D marks.
The Beijing IP Court handles a substantial number of cases each year. Despite a 90% increase in the number of concluded cases since 2015, the court remains under enormous pressure to reduce its case backlog, of which patent administrative cases account for a considerable proportion. In order to reduce this backlog, the court recently began enlisting technical investigators and jurors with technical expertise in court proceedings.
The Patent Law provides that a patent's claims must be based on the description, which is a key mechanism devised to balance protection and disclosure under the law. The Supreme Court has rendered a number of judgments in this regard, which – in addition to the Patent Law and the Patent Examination Guidelines – are of guiding significance for the practical application of the Patent Law.
The Trademark Review and Adjudication Board (TRAB) recently released an analysis of its decisions which were overruled by the courts in 2017, in which it observed that the ratio of court decisions rendered against its own adjudications in the first instance and on appeal has increased each year. In addition to these statistics, the TRAB provided a commentary on issues such as admitting new evidence in court proceedings, changes of circumstances and trademark coexistence agreements.
The submission of experimental data after the filing date (also known as post-filing data) in support of the patentability of inventions has long been debated in the Chinese patent community. While opinions are divided in this regard, post-filing data provided by the applicant or patentee may serve as useful evidence if an invention is challenged for substantive defects.
The State Intellectual Property Office recently announced that a number of official patent application fees would be waived as of 1 August 2018. In addition, if a patent applicant or patentee meets the criteria for annuity reduction as set out in Article 3 of the Measures on the Reduction of Patent Official Fees, the reduction period will be extended from six years (calculated from the year of grant) to 10 years.
Requesting Customs to seize export products on grounds of patent infringement can be a potent legal tool against exporters. If the products involved are subsequently detained by the court and found to be infringing, they will be destroyed. However, it is difficult for patentees to organise customs seizures of exported patent-infringing products. If the other party files a counterclaim, the patentee may end up shooting itself in the foot.
Too many trademarks are filed in China for the purpose of trading them as a commodity for profit. These marks are not filed for the purpose of functioning as a source indicator of goods or services, which leads to frequent procedures before the Trademark Review and Adjudication Board. The courts should scrutinise evidence of use more closely if it is suspected to have been forged by a trademark registrant. The level of scrutiny demonstrated by the Beijing High Court in a recent case is therefore most welcome.
The Central Committee of the Communist Party recently released the Plan on Deepening the Reform of Party and State Institutions, providing insight into how the government will be run in the medium to long term following the State Council's plan to streamline governance. As part of the government overhaul, the State Intellectual Property Office will be restructured to integrate the registration and administrative adjudication responsibility for patents (its existing function), as well as trademarks and geographical indications.
The Paris Convention forms the cornerstone of China's legislative framework on the protection of commercial signs. This framework also comprises the new Anti-unfair Competition Law, which took effect in January 2018, and the Trademark Law, among others. This article analyses Article 59(3) of the Trademark Law and, by way of a comparison with the corresponding provisions of the new Anti-unfair Competition Law, examines how the new law will redefine the legal landscape for protecting commercial signs.