The Intellectual Property Court of the Supreme People's Court (the IP Court) has concluded quite a few benchmark cases with demonstrative value in clarifying legal application criteria since it was launched Jan 1, 2019, according to Mr. Wang Chuang, Deputy Chief Judge of the IP Court, who was interviewed by The Paper during the plenary sessions of the National People's Congress and the National Political Consultative Conference of China.

In 2019, the IP Court accepted 1,945 cases including patent-related cases and concluded 1,433 of them. Cases of second instance, which have an average trial period of 73 days, numbered 1,174. The court has been devoted to unifying and clarifying judgment criteria, encouraging and protecting technological innovations and creating a high-quality business climate. Wang pointed out that the court will strengthen market protection of technological IPR to help realize the IPR's market value, adding that adapted judicial policies and judgment criteria will be used in accordance with varieties of technological fields so the judicial protection better matches the innovation.

Giving IPR-holders the best protection over their legitimate rights and interests

A summary of adjudicative rules extracted from typical IP cases was issued by the SPC this April. According to Wang, these adjudicative rules are all extracted from appellant cases handled by the IP Court that give practical solutions to real problems arising out of the litigation. The document implements the requirement to unify adjudicative rules of technology-intensive IP cases and to improve quality and efficiency of trials and judicial credibility.

With the economic development and implementation of the innovation-driven development strategy, better IPR judicial protection over intellectual property is in urgent need to support innovative development of enterprises with judicial measures in a timely and fair manner.

He mentioned that the courts' current challenges are mainly the surge in case numbers and their increasing complexity. Meanwhile, the judicial protection over intellectual property should be IP-value-oriented while the courts should consider a variety of matters including improving effectiveness of judicial protection of technology-intensive IP cases and fairly protecting legitimate rights and interests of different economic entities and parties from different countries and regions.

Building a system to unify judicial standards

The IP Court is the first court in the world specialized in handling technology-intensive IP cases at supreme-court level. The IP Court has its advantages in improving trial quality plus efficiency and scientifically allocating judicial resources, which saves time and money, and promotes unification of judgment criteria.

A series of innovative measures were taken by the IP Court in 2019. For instance, it has implemented a centralized and unified jurisdiction system and a "Leapfrog Appeal" system with Chinese characteristics, which not only helps unify judicial standards and shorten the duration of dispute resolution, but also highlights the judicial policy and adjudicative rules for technology-intensive IP cases at the highest judicial level in China.

By exploring the coordinated trial mechanism for civil and administrative cases involving the same patent and with the support of Beijing Intellectual Property Court and other local courts, the IP Court has taken full advantage of its centralized jurisdiction, and established a coordinated mechanism for civil and administrative cases involving the same patent, to synergize the determination of the patent validity and the determination of infringement, thus resolving at the mechanism level the problem of long period for patent litigation and the plaintiff's inconsistent claim constructions for the same patent in different cases.

In addition, Wang introduced the people-centered circuit trial system promoted by the IP Court in China. Supported by the 6 Circuit Courts of the SPC and the local courts, the IP Court promoted a circuit trial model of "the IP Court plus Circuit Courts" and established a case trial mechanism of "Investigation plus Court Hearing". Through the mechanisms, circuit trials are arranged at the place where the dispute occurred or where the people's courts of first instance is located, which promote prompt and on-spot resolution of disputes.

In 2019, the IP Court also improved the technical fact finding mechanism by building a "Database of Technical Investigators and Technical Consulting Experts for Chinese Courts". The platform gathers more than 360 technical investigators and technical consulting experts specialized in over 30 technological fields.

Last but not least, the IP Court has built and implemented the "systemization project to unify judicial standards", and has established a working system with special standards, subsection guarantees, and strict management of key points, providing institutional and systematic guarantees for the unified judicial standards for technological-related IP cases. Moreover, strengthening IT construction, promoting smart case-handling system and improving judges' judicial capacity have also been the focuses of the IP Court and have played a role in judicial reform.

Selecting benchmark cases to promote business environment

The IP Court took advantage of its centralized jurisdiction of technological-related IP cases of second instance and collected a group of benchmark cases with typical exemplary effect, social influence, and the value of uniform legal application standards as examples for other cases.

According to Wang, in 2019, the IP Court handled cases covering a wide range of fields including the medicine, telecommunications, animal genes, network cable, large machinery, smart input methods and computer software. By playing its full role in technological IPR protection, the IP Court contributed to construction of an innovative and fair business climate. He stressed that IPR is the engine to drive innovation and the IP Court will pay more attention to strengthening protection of the IPR market and will determine damages scientifically and adopt different judicial policies and judgment criteria so that judicial protection matches with the innovations.

Lowering costs of remedies

For years, safeguarding IPR has been costly and compensation of the infringement has been relatively low as IPR is intangible and easy to copy and duplicate. Moreover, IP cases often lack evidence on infringer's behavior and a basis for calculation of loss compared to general tort cases. What's worse is that the accused infringer usually claims that the IPR at issue is invalid and initiates an administrative invalidation, which would lead to multiple suits, thereby increasing litigation costs. On the other hand, IPR-holders need to improve their capacity in gathering evidence and their understanding of litigation procedures and courts need time to explore unknown fields when facing innovative technology.

In addition, a judicial opinion on comprehensively strengthening IP protection was recently released by the SPC. It includes measures to solve five types of problems, which are lowering cost of remedies, shortening case trial duration, increasing infringement compensation, cracking down on dishonest litigation in accordance with the law and effective enforcement of judgments. The opinion clarifies that profits from the infringement can be confirmed by data from the industry, commerce and tax departments, third party commercial platforms, the infringing party's website and listing documents on the stock exchange as well as average profit rate of the industry. Factors such as the market value of the IPR and the duration, impact scope, and severity of the infringement should also be considered in determining the damages. The opinion also stresses that in cases of serious IP infringement, the damages shall be determined at a higher level in accordance with the law and the fake products as well as the materials and tools involved should be confiscated and destroyed to avoid further infringement.

Wang also mentioned that the IP Court is devoted to construction of a good-faith-oriented evidence mechanism by an explorative application of rules regarding evidence disclosure and exclusion of evidence obstruction. He further explained that enhanced damages will be applied to penalize those litigants in bad faith, e.g. intentionally hiding or falsifying evidence, obstructing and resisting the preservation of evidence, interfering with witnesses, refusing to submit account books related to infringement, etc.