Glenn He of Ocean Tomo China shares an update on 2020 Chinese IP Courts and insight from case rulings with global impact.
The official Chinese annual court report is traditionally published in April each year, corresponding to World IP Day. In 2020, Beijing courts reported 66,000 civil and administrative IP cases. As compared to 2015, damages awards increased from RMB 120,000 to RMB 420,000 for trademarks and RMB 430,000 to RMB 620,000 for patents.
The specialized IP court in Guangzhou also published a report, counting a total of 6,905 cases. Notably, the court was able to issue more substantial relief, such as injunctions and triple punitive damages.
While Chinese local reference cases remain steadily, there have also been a few very high-profile rulings that have global impact. Echoing the judgment of an English court decision on a global Standard Essential Patent (SEP) rate, the Intermediate Court in Shenzhen issued a decision affirming the court’s jurisdiction over the global SEP rate in Sharp v. Oppo. Some speculate a shift by litigants to Chinese courts as a result of this decision for matters involving global SEP/FRAND rates, even though the English decision has opined otherwise. While the complex issue of global SEP/FRAND rates is unlikely to reach a consensus soon, it is nonetheless recognized as progress that two major jurisdictions are willing to take that challenge.
Another case with global implications involves InterDigital (IDCC) and Xiaomi. Xiaomi filed a petition for a FRAND rate decision to People’s Intermediate Court in Wuhan in June, after licensing negotiations stalled. IDCC followed with an infringement suit seeking injunctive relief in Delhi, India. The Court in Wuhan issued an anti-suit injunction, preventing IDCC from bringing any lawsuits against Xiaomi globally. The Court in Delhi granted IDCC’s petition for an anti-anti-suit injunction in response. Similarly, in Huawei v. Conversant, the Chinese Supreme People’s Court also issued an anti-injunction decision against Conversant. As of this report, there has not yet been a counteraction from Dusseldorf’s German court in which a parallel lawsuit had taken place. Interestingly, the latter two cases involve NPEs who traditionally focus on the more mature legal environments such as the US and Europe.
While telecom SEPs have historically been one of the most active battlegrounds for patent disputes, it has only been recent that plaintiffs started suing Chinese companies in their home court. In addition to the fact that Chinese smartphone makers are the most relevant yet unencumbered licensees to telecom SEPs, the timing of these cases suggests a vote of confidence for the Chinese the judicial system.