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| Bid to fortify IPR protection |
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| Publish Time：2005-5-16 21:35:19 |
Editor's note: In the last issue of Business Weekly, Jiang Zhipei outlined a few points key to the application of a judicial interpretation by the Supreme People's Court regarding the pretrial measure of stopping infringement of patent rights, a legal weapon newly introduced to Chinese law. In this issue, he continues to discuss some technicalities regarding the application.
5. Regarding security for the pretrial measure of stopping patent infringement.
The TRIPS (Trade Related Aspects of Intellectual Property Rights) agreement stipulates that the party applying to the judicial organization for the preliminary measure should supply security. When other countries execute similar measures, an applicant is also required to supply qualified security in order to prevent the applicant from abusing the right.
Paragraph 2 of Article 61 in the newly modified Patent Law stipulates that Articles 93 to 96 of the Civil Procedure Rule are to be cited to handle such applications. Article 93 of the Civil Procedure Rule addresses security for measures taken against tort. However, all of the above articles focus on attachment - the seizure of property by a court to ensure the enforcement of a judgment - and no stipulations have been made regarding injunctions against patent infringement. For this reason, Article 6 of this interpretation stipulates that security should be supplied when applying for the stopping of relevant tort before the institution of an action.
In addition, some particulars should be considered for determining the amount of security, such as the sales of the goods in question and the cost of storage.
Article 8 of this interpretation also stipulates that additional security may be required in circumstances where execution of this measure may cause additional losses to the party against whom the application is filed. The court which hears the application may decide the added amount of the security according to the particulars of a case.
6. Regarding specific enforcement of the pretrial measure to stop patent infringement.
According to the stipulations of Article 61 of the Patent Law, the measure to stop patent infringement is adopted when the applicant would suffer irrecoverable losses unless such a measure is urgently taken. Timing is crucial. Therefore, Article 9 of this interpretation stipulates that the People's Court should issue a written ruling within 48 hours of accepting the application, and the ruling should be enforced without delay. Article 5 of this interpretation states that such a pretrial ruling should be limited to the scope of the application submitted to the court. This is a measure designed to prevent a court from abusing the right of discretion.
Article 50 of Section 3 of the TRIPS agreement, regarding preliminary measures, stipulates that stopping infringement may be "executed unilaterally" before the court in session, and the party against whom an application is filed should be informed in time after the measure is adopted. That is to say, in order to ensure effective execution, the court should not notify the party against whom an application is filed until after the measure is adopted. Then the person shall have the right to apply for a review of the application. In line with the regulations of TRIPS, the interpretation stipulates that the party against whom an application is filed should be notified of such a unilateral ruling no later than five days after the ruling.
The preliminary measure against patent infringement is different from attachment in terms of both content and requirements, as the damages resulting from patent infringement may be irrevocable and cannot simply be compensated financially. In attachment, the court ruling could be stayed upon counter security furnished by the party against whom an application is filed. However, it would lead to failure of the pretrial measure if it can be stayed by counter security in case of patent infringement. For this reason, Article 8 of this interpretation states that a court ruling for such a measure shall not be stayed against a counter guarantee furnished by the party against whom an application is filed.
Such a measure in fact puts the applicant in a favourable position in a patent infringement suit. However, according to stipulations of TRIPS and intellectual property right agreements of other countries, the measure of stopping relevant patent infringement should be rescinded if the applicant has not sued or sued improperly within a certain time period after application of the measure. If the party against whom an application is filed suffers losses because either no legal action is taken or action is applied incorrectly, the applicant should make due compensation. Article 12 and 13 of this interpretation stipulate this and detail the proceedings for resolving compensation issues.
As to the time limit of such a measure, the interpretation provides that the validity of the ruling should generally be maintained until a judgment or ruling comes into force. A court may also determine the specific time limit for enforcement of the measure, given the particulars of the case. When the time limit expires, the court may decide whether the measure should be continued as per the parties' request. Such stipulation is more flexible and suitable for the demand of trial practice.
In addition, in order to guarantee the smooth execution of rulings and to maintain the dignity of law and unification of the legal system, parties who violate rulings will be fined penalties according to Article 102 of the Civil Procedure Rule. Parties whose acts constitute a crime may be prosecuted for criminal liabilities.
7. Other issues requiring clarification.
The enforcement of the legal measure to stop patent infringement may involve the co-ordination of many government agencies responsible for registration and intellectual property right administration. In view of the strict time limit in applications for stopping relevant tort before the institution of an action, the ruling should be administered by an experienced judge.
Attached is the complete text of Article 61 of the Patent Law on which this judicial interpretation is based:
The patentee or interested person has evidence to testify other people are carrying out or will carry out infringement of his patent right, and his lawful rights and interests would suffer irrecoverable losses if infringing torts are not suppressed in time, he may apply to People's Court for measures of ordering to stop relevant tort and attachment before filing an action.
People's Court shall handle the previous article of application according to the stipulations of Articles 93 to 96 of the Civil Procedure Law of the People's Republic of China.
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