Intellectual Property Protection by Chinese Courts(2019)

Intellectual Property Protection by Chinese Courts(2019)Introduction

2019 was the 70thyear of the founding of the People’s Republic of China. The same year saw theunfolding of the People’s Courts’ Fifth Five-Year Reform Programme (2019–2023).Guided by General-Secretary Xi Jinping’s thought on Chinese socialism for thenew era, the courts implemented the decisions and essential values of the 19thNational Congress of the Communist Party of China (“Party Congress”) and of thesecond, third and fourth plena of the 19th CCP Central Committee. They havealso continued to foster the “four aspects of consciousness”, the “four mattersof confidence” and the “two pillars to safeguard”, never losing sight of theiroriginal aspirations and mission. They pursued the national goal of building acomplete xiaokang society, discharged adjudication duties based on thelaw and the constitution, and intensified reform of the adjudication system toimprove adjudication efficiency, effectiveness and judicial credibility. Theyhave also ensured efficacious discharge of their adjudication duties. Havingdedicated significant effort to building an effective team, the courts rebootedand renewed the intellectual property adjudication regime to further elevatethe credibility and impact of China’s intellectual property adjudication at theinternational level. By continuing to modernise the intellectual property adjudicationregime and capacity, the courts have also enabled the delivery of robustjudicial services and enactment of judicial safeguards to underpin thecountry’s innovation-driven development and creation of a pro-businessenvironment.

I. Leveraging the adjudicationprocess for more effective protection

The 19th CCP Central Committee’s fourth plenary session issuedimportant directives to advance Chinese socialism and modernise the nationalgovernance system and governance capabilities. The session also gave instructions forthe country to improve systems and mechanisms to encourage technologicalinnovation, redouble efforts to build an innovation-based country andstrengthen national strategic technologies. To elevate China’s technologicaland innovation capabilities, drive quality economic growth and implement ourinnovation-driven development strategy, we need greater protection and utilisationof intellectual property to fashion an effective incentive structure. As thecourts “strive to make the people feel fairness and justice in every judicialcase”—a goal that centres on the people and fair justice—intellectual propertyadjudication has become an important means to incentivise and protectinnovation.
In 2019, the courts have accepteda total of 481,793 cases, including first instance and second instance casesand applications for extraordinary legal remedy to reopen cases.475,853 cases(including carried forward cases) were concluded, representing a respectiveyear-on-year increase of 44.16 % and 48.87%.

(I) More effective adjudication ofcivil disputes
Given the essential role ofintellectual property adjudication in protecting innovation and in levellingthe competitive playing field, adjudication has focused on encouragingtechnological innovation, promoting cultural transmission and maintainingmarket order to provide clear, consistent and predictable rules to guideadjudication and instil confidence among entrepreneurs and innovators.
In 2019, the Supreme People’s Court accepted2,504 new civil intellectual property cases and concluded 1,976 cases, respectively174.26% and 260.97% higher than the previous year. In the same year, the localcourts accepted 399,031 and concluded 394,521 first instance civil cases, wherethe respective year-on-year increases were 40.79% and 44.02%. Among the newlyaccepted cases, 22,272 were patent cases (2.64% year-on-year increase); 65,209 trademark cases (25.41% year-on-year increase); 293,066 copyright cases (49.98% year-on-year increase). There were also 3,135 cases ontechnology contract disputes, (16.98% year-on-year increase) and 4,128 unfair competitioncases, including 70 monopoly cases, (49.71% year-on-year increase). Other civil intellectualproperty disputes constituted 11,221 cases, or 49.71% more than last year. Forsecond instance cases, 49,704 were accepted and 48,710 concluded, translatingto a year-on-year increase of 79.95% and 85.29% respectively.
High profile civil disputesinvolving intellectual property heard and concluded by the courts during theyear include:
French automotive parts manufacturer Valeo Systemes D’Essuyage(plaintiff- appellee)vs. Lukasi Car Accessories(Xiamen) Co. Ltd (respondent-appellant) and Fuke Car Accessories (Xiamen) Co. Ltd. (respondent-appellant)et al. involving a utility patent infringement dispute; HondaMotor Company (plaintiff-appellee- petitioner) vs. Hengsheng Xintai (Chongqing) Trade Company (respondent-appellant-petitionee), Hensim (Chongqing)Group et al. (respondent- appellant-petitionee) involving a trademarkinfringement dispute; Hemujia Medical Management Consultancy(Beijing) Co., Ltd (plaintiff,-appellant-petitioner)vs. Hemujia Obstetrics andGynaecology Hospital (Fuzhou)(respondent-appellee- petitionee) involving unfair competition; Cai Xinguang (plaintiff-appellant) vs. RunpingCommerce (Guangzhou) Co., Ltd(respondent-appellee) involving infringement of new plant variety; and copyrightinfringement case of ShanrenSculpture (Hebei) Co., Ltd(plaintiff-appellant) vs.Zhongding Garden Sculptures (Hebei) Co., Ltd et al. (respondent-appellant) and the People’s Government of Sanhe Township, Bozhou District, Zunyi Cityet al. (respondent-appellee).

(II) More rigorous legality review ofadministrative actions
The courtshave strengthened legality review of intellectual property granted andvalidated by administrative authorities and of administrative enforcementactions. In 2019, the Supreme People’s Court accepted1,066 intellectual property cases involving administrative disputes andconcluded 884 cases. Compared to last year, the number of cases has risen by70.83% and 52.15% respectively. The same year saw local courts accepting 16,134first instance administrative cases (19.11% increase year-on-year), 1,661were patent cases (8.14% increase year-on-year), 14,457 trademark cases (20.56%increase year-on-year) and 16 copyright cases. 17, 938 first instance caseswere concluded (89.74% increase year-on-year). Local courts also accepted 7,304(104.88% increase year-on-year) second instance administrative cases, and 5,942cases were concluded (84.71% increase year-on-year), of which, decision wasupheld for 4,791 cases, first instance judgement was amended for 1,026 cases; 4cases were remanded for retrial, 613 cases withdrawn, and 132 cases overruled.
High profileintellectual property-related administrative disputes heard and concluded bythe people’s courts during the year include Huawei. Technologies, Co, Ltd(plaintiff-appellee) v. Samsung Electronics Co, Ltd (Thirdparty-appellant) and CNIPA (respondent) involving an administrative overthe invalidation of a patent; and Kangzhi Lesi Network Technology (Beijing)Co., Ltd (plaintiff-appellee-petitionee) v. Meiyou InformationTechnology (Xiamen) Co., Ltd (third party-appellant-petitioner) and CNIPA(respondent-appellant) involving an administrative dispute over theinvalidation of a trademark.

(III) Stricter sanctions onintellectual property crimes
Intellectualproperty crimes were subject to more rigorous adjudication toclean up the market, therefore better defend intellectual property fromcriminal infringement.
In 2019, thelocal courts accepted 5,242 first instance intellectual property-relatedcriminal cases, 21.37% higher than last year, including 4,982 cases relating toinfringement of registered trademarks ( 21.01% increase year-on-year), and 210 oncopyright infringement (34.62% increase year-on-year).
At the locallevel, 5,075 first instance cases were concluded during the year (24.88%increase year-on-year), including 2,134 cases involving counterfeiting ofregistered trademarks (15.23% increase year-on-year), 2,279 cases involvedselling goods bearing counterfeit registered trademarks (32.19% increaseyear-on-year), 423 were cases of illegal manufacturing or sale of goods bearingillegally produced registered trademarks (38.69% increase year-on-year); 1 caseinvolved counterfeiting patents, 191 were criminalinfringement of copyright, (40.44% increase year-on-year), 8 involved sellinginfringing reproductions (33.33% increase year-on-year), and 39 involved trade secret infringement crime (no changefrom last year).
For second instance intellectual propertycases involving criminal offences, the local courts accepted 808 cases (18.30% increaseyear-on-year), and 807 cases were concluded (23.70% increase year-on-year).
High profile criminal cases involvingintellectual property heard and concluded by the people’s courts during theyear include: Yang Fengming, Yang Maogang et al. for counterfeiting aregistered trademark; Lin Yixiang et al. involving infringement of tradesecrets; Xu Zhenwei et al. involving counterfeiting of registeredmark; and Chen Li et al. involving trademark infringement.

Intellectual property adjudication has madesteady progress in the year, and has scored higher in quality andeffectiveness. The key features for 2019 are:

New highs in caseload. Withincreased social awareness of intellectual property right and greatercredibility of the courts in adjudicating intellectual property disputes, thecourts have faced a spike in caseload. The total number of accepted andconcluded cases for the year 2019 were at historic high, both recording a year-over-yearincrease of more than 40%.
By geographical location, Beijing accepted80,165 cases, Shanghai 23,580 cases, Jiangsu Province 20,249 cases, ZhejiangProvince 27,706 cases and Guangdong Province 157,363 cases, totalling 309,063cases. This constituted 64.15% of China’s total case number and the greaterpart of the country’s intellectual property caseload. The areas that experiencedmore than 50% year-on-year increase in caseload were Hebei Province (53.53%),Anhui Province (60.30%), Fujian Province (64.88%), Guangxi Autonomous Region(98.49%) and Chongqing Municipality (173.66%). Despite facing manpowershortages, the courts have managed to dispose of a large number of cases duringthe year, with the total disposal number reaching historic high. Other thanbeing the most active regions, the courts in Beijing, Shanghai, JiangsuProvince, Zhejiang Province and Guangdong Province have also achievedcommendable disposal rates of more than 90%.

Continued emergence of new case genres. As the newround of technological revolution and industrial transformation rapidlyemerges, legal boundaries are increasing tested and pushed by new technologies,new products and new forms of business. New intellectual property issuesinvolving cutting-edge technology relating to the Internet, big data,artificial intelligence, standard essential patents, biomedicine have also continuedto emerge, requiring detailed examination of complex technological solutionsand creative application of the law, based on the merits of each case. Someexamples are:
The Supreme People’s Court: Heardpatent cases involving mechanics, material science, electrical engineering,communications, biopharmaceuticals, and fine-tuned the adjudication rules baseon the derived insights.
Beijing Intellectual Property Court: Heard andconcluded many significant and complex cases, including the first case relatingto the infringement of cloud servers, and preservation of evidence duringpre-trail for a case involving the infringement of a patent relating to the productionof stable lyophilised pharmaceutical composition.
Shanghai High People’s Court: Concluded Nokiavs. Shanghai Huaqin Communication Technology Co., Ltd involving the infringementof a utility patent. The case provides reference for tryingcommunications-related SEP disputes in the future.
Guangdong Province: The courtshave heard 63 patent cases, each involving a jurisdictional amount of more thanCNY 10 million, the aggregate amount of which was approximately CNY 8.18billion.

Continued to augment protection. The courtshave implemented the “Opinions on Improving the System of Property RightsProtection to Protect Property Rights According to Law” to provide more timelyand accessible judicial relief for intellectual property disputes, as well as tobalance the damages awarded with the market value of the intellectual propertyin question. Some exemplary efforts include:
Beijing: TheHaidian District People’s Court awarded damages of more than CNY 20 millionbased on discretionary valuation when Motion Scene (which operates UC browser)sued Sogou for using its Sogou Input Method to redirect the user to Sogou’ssearch website.
Inner MongoliaAutonomous Region High People’s Court: Increased the amountof damages from CNY 50,000 to CNY 1 million in the Guangdong Landai GroupBeijing Lanbao Beer Co., Ltd vs. Henan Honghuo Food Co., Ltd et al.trademark infringement case to sanction infringers more severely.
Zhejiang High People’sCourt: Ordered the respondent to pay CNY 8 million in damages for the Aupu ElectricalAppliances (Hangzhou) Co., Ltd and Aopu Home Furnishing Co., Ltd vs. Zhejiang FashionBuilding Materials Co., Ltd and Zhejiang New Energy Co., Ltd case involvingtrademark infringement and unfair competition. The court’s decision has protectedthe “AOPU” brand value.
Fujian Province: The courtsimposed punitive damages in the “JIU MU WANG (lit. ‘King of Nine Herds’)”trademark dispute and the “BOLIMO” trademark and unfair competition disputewhen the damages awarded were either doubled or trebled the amount forcompensatory damages.

Effects of judicial efforts were recognised. The courtshave done well in a series of complex and novel cases that attractedconsiderable public attention. The precedence would serve as classic cases thatare demonstrative and could guide future adjudication. Exemplary effortsinclude:
SPC IP Court: Issued decision forits first case immediately after the hearing, and the determination criteria forfunctional features were detailed in the written judgement. The hearing wasbroadcasted live and was widely reported by the media. Live streaming of thehearing—a case that took only 50 days to conclude from the date it was acceptedto service of judgement—attracted more than 18 million viewings. Opening up thecourtroom for public scrutiny has ensured fairness, transparency andefficiency.
Gansu High People’s Court: Concludeda new plant variety dispute involving a foreign party, thereby protecting thelawful rights of the plant breeder.
Shanghai Intellectual Property Court: Concluded aseries of cases, which include the utility patent dispute between NetacTechnology (Shenzhen) Co., Ltd and Transcend China (Shanghai) Co., Ltd. Thedisputes, which involved cutting-edge technology used in mobile storage and ajurisdictional amount of more than CNY 24.7 million, has attracted widespreadattention and much recognition.
Hunan Province: Adjudicated trademarkinfringement and unfair competition cases involving a wide range of servicesectors such as food and beverage, creative photography and department-storesales. The decisions provided direction for the regulated and reasonable use oftrademark by players in the food & beverage, department store and creativeindustries, which in turn supported the healthy growth of the service sector.

Remarkable ADR outcomes. The courtshave continued to turn to non-litigious alternative dispute resolution as theprimary means to settle dispute, and on promoting the new era FengqiaoExperience—a way of community-level social governance whereby public effortwas harnessed to maintain social stability. By actively encouraging the broaduse of ADR, parties were encouraged to resolve disputes through non-litigiousmeans by working together to find mutually agreeable and beneficial ways tosettle intellectual property disputes efficiently. Exemplary efforts include:
The Supreme People’s Court : Successfully mediated the trademark infringement case of Henan DukangInvestment Group vs. Shaanxi Baishui Dukang Company, and permanentlyresolved all cases relating to the “DUKANG” (believed to be a minister underthe mythological Yellow Emperor and originator of winemaking) trademark issue. Thecourt’s efforts have contributed to improving the stability of the local marketand providing protecting local businesses. It established a nation-widewhole-of-system coordinating mechanism to explore a circuit adjudication modelcombining the workings of an IP court and a circuit court, and an adjudicationmechanism combining onsite examination (kanyan) and hearing, and hassince facilitated the unified settlement of 48 related cases nationwide. Italso enabled the efficient resolution of 80 patent infringement cases at thepre-trial stage. The court’s efforts have made litigation easier and enabledthe Fengqiao Experience to enrich the intellectual property sector.
Beijing: Continued to drivereform of the “ADR + expedited procedure” as part of the city’s effort tomodernise the capital city’s social governance system and governance approach.
Jilin Province: The courts focused onusing mediation to resolve disputes. Total mediation rate for intellectualproperty disputes was 75%.
Anhui High People’s Court: Succeededin mediating the dispute between China Broadcasting Satellite TV and ChinaTelecom Anhui Branch concerning the infringement of broadcasting right, with ajurisdictional amount exceeding CNY 100 million.
Shandong Province: The courts implementedthe “Regulations to Promote Use of Alternative Dispute Resolution for ShandongProvince” and worked at developing a platform to align litigation withmediation.
Hubei Province: The courts coordinatedresources and established mediation platforms comprising administrative organs,lessors of the site where infringement occurred, industry associations, attorney-mediationorganisations to facilitate mediated settlement of disputes.
Sichuan Province: The courts enteredinto a cooperation agreement with the China (Sichuan) Intellectual PropertyProtection Centre to develop a mechanism to provide coordinated protection ofintellectual property. Under the agreement, the centre was appointed to mediateintellectual property-related disputes.
Yunnan Province: The courts establisheda pre-trial mediation system for intellectual property cases to enable theprompt resolution of a certain proportion of intellectual property disputes.
Liaoning Province: The courts beefed upexisting ADR mechanism by using pre-trial mediation for copyright, trademarkand unfair competition cases if the facts are clear and minimally disputed. Themechanism has enabled the courts to align litigation with mediation.
Xinjiang Autonomous Region: The courtsfocused on using mediation to settle dispute, translating to a rather highpercentage of post-mediation withdrawal rate.

II. Intensified supporting measuresfor judicial reform and built a more robust intellectual property justicesystem

In 2019, the courts leveraged the “Opinions on Several Issues on Reformand Innovation Relating to Intellectual Property Adjudication” to develop moreinnovative theories and institutions and adopt more innovative practices. Asuite of relevant reforms was also instituted as part of the courts’ effort tocontinue building better systems and mechanisms for intellectual property.

(I) SPC IP Court off to a flyingstart
Creatingthe Intellectual Property Court (SPC IP Court) within the Supreme People’sCourt was an important move by the Party Central Committee, with Xi Jinping asthe core, based on the strategic vision of building an intellectual propertypowerhouse and a high-tech global superpower. It was an important milestonemarking a major breakthrough and innovative step in our intellectual propertyadjudication system.
2019 isthe SPC IP Court’s first year of operation. As an agency tasked to hear all appealcases of technology-related intellectual property disputes, the SPC IP Courthas overcome the early difficulties to drive comprehensive progress bylaunching copious reform initiatives that have scored preliminary successes.
First, it unified adjudication standards . Unificationof adjudication standards was the primary objective of creating the SPC IPCourt. The “Rules of Implementation of a Unified Adjudication Standard for the IntellectualProperty Court of the Supreme People’s court”, among others, was developed toensure that the entire process, from preliminary analysis to mid-processcontrol, final review and approval and stringent management of important cases,were well- administered. Also, the “Minutes of the Conferences of Judges” werecompiled and “Guidelines on Case Operations” prepared and distributed to unifyadjudicative standards and methods for handling similar cases.
Second, it explored combining the hearing of administrative andcivil disputes. Disputes relating to civil infringement andadministrative validation involving the same patent was heard by the sameadjudication panel to ensure alignment of the civil and administrativeprocedures and consistency of adjudicative standards.
Third, it optimised the mechanism for adjudicatingtechnology-related intellectual property disputes. Living by itsmotto of people-centredness and being dedicated to delivering optimaladjudication management, the court leveraged its advantage as the centralcoordinating authority and the “1+76” hierarchical structure to resolve linkeddisputes within the country.
Fourth, it continued to develop the multiprong technicalfact-finding mechanism. By coordinating technical investigationresources in the country, including more than 360 technical investigators frommore than 30 technical fields, the SPC IP Court worked at alleviating theproblems faced by the courts, including inadequacies in technical investigationfor the less-developed regions and the lack of specific technical expertise in developedregions.
Fifth, it strengthened informatisation and adoption of smarttechnology. The court has built case and adjudication rules databases,and created smart platforms such as the “Big Data Intellectual PropertyAnalysis Platform”. It also explored the creation of an “IP CourtCloud”. These were endeavours to meet the demands of parties for onlinesubmission of evidence and online reading of case files, and would become the technologicalbedrock for adjudicating technology-related intellectual property disputes.

(II) Steady progress in development ofintellectual property courts
Toimplement the National People’s Congress (NPC) Standing Committee’s reviewopinions on the progress of local intellectual property courts, the SupremePeople’s court continued to provide more guidance for the Beijing, Shanghai andGuangzhou intellectual property courts, which have continued to make smooth progressand achieve remarkable outcomes.
Sincetheir establishment at the end of 2014, the intellectual property courts haveaccepted more than 100,000 cases and heard intellectual property cases of internationalimpact and which are important basis for crafting adjudication rules. They werealso instrumental for improving the quality and efficiency of hearings,ensuring consistency in decisions, and facilitating innovation-drivendevelopment. The courts have also leveraged their functional positioning toexplore bold and innovative initiatives to drive judicial reform thatengendered a new intellectual property adjudication landscape. The reforms alsoenabled specialisation, an important feature that has helped buttress judicialprotection for intellectual property.

(III) Continued optimisation ofmechanism governing trans-regional jurisdiction
Since2017, specialised judicial organs (IP divisions) were established within 21intermediate courts, such as the Nanjing Intermediate People’s Court, to facilitatecentralised jurisdiction over certain categories of trans-regional firstinstance intellectual property cases and enable specialised intellectualproperty judicial organs to be rationally distributed. The IP divisions havededicated themselves to exploring innovative initiatives and to improving thelevel of specialisation, an important effort that would drive the co-ordinateddevelopment of the Beijing-Tianjin-Heibei (Jing-Jin-Ji) region, and the developmentof the Yangtze River Economic Belt and the Guangdong-Hong Kong-Macao GreaterBay Area (Greater Bay Area). Exemplary work by several local IP divisionsinclude:
Nanjing:Conducted circuit trials, implemented specialised and centralised adjudication,and responded to the demands of high-tech industrial parks to protect theintellectual property of business innovations.
Hangzhou:Leveraged internet technology and established a trans-regional cooperationmechanism to facilitate access to online hearing and standardised applicationof the law.
Zhengzhou:Digitised processes such as introduction of online filing and acceptance ofcases, electronic service of documents and WeChat mediation to overcome timeand spatial constraints, as part of its effort to provide easy access and to increasethe level of informatisation.
Shenzhen:Capitalised on the city’s geographical advantage to strengthen judicialprotection of intellectual property by participating in the development of theGuangzhou-Shenzhen Science and Technology Innovation Corridor and the PearlRiver Delta National Demonstration Zone for Home-Grown Innovation.
Haikou: Tookthe initiative to protect intellectual property by establishing circuit-courtstations and contact points for judicial services within different parts of theprovince.

(IV) Continued rolling-out of moremeasures for the “three-in-one” intellectual property adjudication system

In 2019, the courts implemented the “Supreme People’s ‘s Opinions onPromoting ‘Three-in-One’ Adjudication of Intellectual Property-Related Civil,Administrative and Criminal Cases” to further consolidate the results of the”three-in-one” reform.
SupremePeople’s Court: Reviewed case files relating to intellectualproperty crime to distil first-hand information on criminal adjudication. Thiswill allow more in-depth examination of the norms of adjudicating intellectualproperty criminal offences, based on which, the relevant judicial interpretationscould be revised and improved.
JiangsuHigh People’s Court: Initiated a study relating to the sentencingof intellectual property crimes to provide reference for standardising the useof sanction discretion and in sentencing.
ZhejiangProvince: Since 1 November 2019, all the courts in Zhejiang Province haveimplemented the “three-in-one” adjudication procedure. 260 criminal offencesand 41 administrative disputes were heard during the year.
HainanHigh People’s Court: Initiated research studies on using designatedjurisdiction for intellectual property criminal offences, and clarified the jurisdictionmechanism for “three-in-one” adjudication for intellectual propertycases.

(V) Continued improvement oflitigation procedures
The People’sCourts worked on improving the rules of procedure based on the merits ofindividual intellectual property cases and on developing an optimaladjudication approach to overcome institutional obstacles.

First, giving reasonable guidance in evidenceproduction. The courts have developed innovative measures tostrengthen the burden of proof by enabling ex-officio investigation andcollection of evidence to effectively reduce the costs borne by right-holders.
Shanghai High People’s Court: Explored the use of an evidenceproduction order such that any behaviour that obstructed the production ofevidence would be punished under the law.
Hunan High People’s Court: Regulated policies and proceduresrelating to investigation orders for lawyers.
Hainan High People’s Court: Parties were encouraged to make fulluse of third-party means such as notarisation and electronic data platforms tocollect and preserve evidence.

Second, building a more robust fact-findingmechanism. The courts have elaborated the ways which differentpersonnel could participate in the investigation of technical facts, and have mobilisedmanpower and resources to develop a dynamic and coordinated system for fact-finding.
Supreme People’s Court: Created a pool of experts comprisingtechnical investigators and technical advisory experts employed and appointedby the courts, and established a national mechanism for sharing oftechnical-investigation resources among the courts. It also launched the”Work Manual for Technical Investigators (2019)” to guide the courts intechnical fact-finding and regulate their technical fact-finding activities.
Beijing Intellectual Property Court: Established a”four-in-one” technical fact-finding mechanism, comprisingspecialised people’s assessors, technical investigators, expert assessors andforensic institutes.
Jiangsu High People’s Court: Entered into a framework agreementwith the Jiangsu Province Collaborative Innovation Centre for BiomedicalFunctional Materials, where the parties would cooperate on intellectualproperty-related technical fact-finding. The cooperation enabled the court toengage technical experts to assist in intellectual property cases.
Production and Construction Corps Branch of the Higher People’s Court ofXinjiang Uygur Autonomous Region: When preserving evidence, professionals were engaged to survey thelocation and the planting area of infringing seeds, and to collect samples of infringingplants .
Hubei, Hunan, Sichuan and Shaanxi High People’s Courts: Formedexpert pools to tap professional expertise and improve the accuracy oftechnical fact-finding.

Third, optimisation of adjudication approach. Giventhe diverse judicial needs, the different levels of courts have sought tooptimise their adjudication approaches through a diversion mechanism that separatesthe complicated cases from simple ones, and that applies a unified standard whenapplying the law.
Beijing Intellectual Property Court: Implemented thespeedy trial mechanism, and introduced a pilot that judges would issue”abridged written judgments” for trademark review cases. Averagedisposal time was reduced by 30%.
Xi’an IP Division: Formed an adjudication team to conductspeedy trial, an approached that required only 20% of the manpower to hear 70%of the cases.
Chengdu IP Division: Explored the use of speedy trialmechanism for intellectual property disputes to better allocate adjudicationresources. The outcomes were encouraging.
Haikou IP Division: Implemented an integrated model ofoperations that combined case acceptance, adjudication and enforcement underone operational framework to improve adjudication quality and effectiveness.
Changchun IP Division: Introduced speedy and simplifiedtrials for copyright and trademark disputes. 84.8% of the cases were concludedwithin five months, and the adjudication cycle was substantially shortened.

III. Broadened judicial functions andcontinued improvement of research quality and effectiveness to guideadjudication

Always vigilant ofhot button issues, the People’s Courts have leveraged the Supreme People’sCourt’s Intellectual Property Judicial Protection Research Centre and itstheoretical research base to strengthen development of intellectual propertyprotection-related innovative theories and research of the relevant judicialpolicies. They have also actively participated in the revision of intellectualproperty-related laws and provided effective judicial supervision and guidance.

(I) More focus on providing legislativerecommendations
The courts haveactively participated in the revision of laws and regulations such as the CivilCode, Patent Law, Trademark Law, Anti-Unfair Competition Law, Copyright law,Regulations on the Implementation of the Trademark Law, and Regulations on theProtection of New Plant Varieties.
Other legislativeendeavours include participating in thefourth forum on Patent Law amendment, and CPPCC’s meeting on folkliterature and artistic works relating to the drafting of the amendments to theCopyright Law. The courts also initiated researches on a special procedure lawfor intellectual property litigation, established the general direction, basicframework and key content of the research.

(II) Intensified drafting of judicialinterpretation
The Supreme People’s Court issue the “Provisions on the Participationof Technical Investigators in Intellectual Property Litigation” setting forththe procedure, responsibility, validity, liability relating to theparticipation of technical investigators in intellectual property litigation.It also researched on topics such allocation of the burden of proof,investigation and collection of evidence, exchange of evidence, and examinationand determination of electronic evidence. The court also organised variousseminars on the drafting of judicial interpretation for punitive damages forintellectual property infringement, application of the Trademark Law and LawAgainst Unfair Competition, trade secrets, and national defence patentdisputes.

(III) More in-depth study of judicialpolicies
The courts participated in the drafting of the “Opinions onStrengthening the Protection of Intellectual Property”, allowing specialisedintellectual property adjudication organs such the Guangzhou IntellectualProperty Court and the Shenzhen Intellectual Property Division to play biggerroles, and stepped up cooperation in GBA-related intellectual propertyprotection and professional training. For Guangzhou Knowledge City (GKC), thecourts also pressed ahead with the national comprehensive reform pilotprogramme to better utilise and protect intellectual property.
To better serve the free trade zones, special studies on theprotection of intellectual property were conducted, based on which, 38initiatives relating to the judicial protection of intellectual property forthe development of free trade zones and free trade ports were proposed.

(IV) Leveraged the role of caseguidance
As part of its annual activities, theSupreme People’s Court published the “Annual Report on Intellectual PropertyCases (2018)’” and the “Top Ten Intellectual Property Cases Decided by ChineseCourts and Fifty Typical Intellectual Property Cases”. The publicationsindicate Supreme People’s Court’s priority in distilling universally applicableadjudication standards to guide judges. The court also organised a “JudgementWeek” during which the decisions of benchmark cases were issued in an opencourtroom so as to use new genre, difficult and complex cases to shape rulesand regulations. The endeavours of other courts include:
Shenzhen IP Division: Reviewed its experience from the reformfor speedy hearing of design patent disputes and selected 19 typical cases foranalysis.
Inner MongoliaAutonomous Region High People’s Court: Held a briefing to update on intellectual property adjudicationand to launch the compilation of typical cases heard by the court to regulateand guide market players. The court hoped to influence market players tooperate in good faith and ensure that the economic order of the market respectsfair competition.
Henan HighPeople’s Court: Published typical casesrelating to trademark and brand protection .
Sichuan HighPeople’s Court: Published for the firsttime a white paper on the judicial protection of the intellectual property of non-stateenterprises (minying qiye) and typical cases. The paper expounded the problemswith intellectual property protection that non-state enterprises have faced,the underlying causes, and provided recommendations.

(V) Intensified judicial researches
Diverse research methods. The SupremePeople’s Court collated big data relating to trademarks registered and usedduring the past five years, studied the measures regulating trademark squatting,and gave recommendations. It also convened discussions on image copyrightinfringement to examine the pronounced issues and addressed social concerns byproviding clear adjudication standards.
Liaoning Province: The courts conducted intellectual property-related studies on topicssuch as the Belt & Road Initiative and pilot free trade zones to find outwhat companies need in terms of judicial protection.
Zhejiang High People’s Court: Surveyed more than 20 companies within theprovince to effectively address the judicial protection needs ofinnovation-based businesses.
Heilongjiang Province: The courts conducted in-depth studies on non-state enterprises anddeveloped manuals to educate the public to better protect the intellectualproperty of private enterprises and drive the development of the privateeconomy.
Hunan Province: The courts took the initiative to meet the judicial needs ofenterprises and tech parks, and enhanced awareness among businesses ininnovation-based development.

Productive research studies. The Supreme People’s Courtinitiated surveys relating to revisionof the Patent law, patent linkage, and business model innovation. The surveysculminated in research outcomes such as the “Recommendations on Reforming and ImprovingLegislation for Patent Invalidation Procedure”, “Recommendations on Legislatingfor Patent Linkage”, and “A Study on the Judicial Protection of Business Model Innovations”.Other research efforts include:
Beijing High People’s Court: Reviewed the guidelines for adjudicating administrativedisputes relating to the granting and validation of trademarks to guidelitigation behaviour.
Zhejiang High People’s Court: Conducted studies on adjudication rules forintellectual property disputes involving e-commerce platforms to share judicialexperiences relating to e-commerce business.
Fujian High People’s Court: Provided opinions on how the courtscould improve judicial protection of intellectual property to better serve and fosterinnovation, entrepreneurship and creation.
Jiangsu High People’s Court: Proposed more rigorous judicialprotection of intellectual property to underpin the province’sinnovation-driven economic development.

IV. Increased transparency of thecourts to augment credibility of intellectual property adjudication

The courts are fully aware of the need for transparency, and have maderemarkable progress in developing a judicial mechanism that upholds justicethrough enhanced transparency and that champions credibility, openness,dynamism, transparency and accessibility.

(I) A more open court system
The courts have opened up further to allow public access to courthearings. This is in line with the directive that open courts should be therule and closed courts the exception. They have also found innovative ways forthe public to access court hearings and expanded the types of hearing permittedfor public observation. Some exemplary practices are:
Guangdong High People’s Court: Held a public hearing on the dispute between Shenzhen-basedJiedian Technology Co., Ltd and Laidian Technology Co., Ltd over theinfringement of utility models. About 100 people attended the hearing. Livestreaming over the internet was also accessed by nearly 10,000 viewers.
Sichuan High People’s Court: Heard a trademark infringement dispute and issued decision withinthe same hearing session. People’s Congress deputies and members of the People’sPolitical Consultative Conference wereinvited to the observe hearing.
Inner Mongolia Autonomous Region High People’s Court: Launched “On-Campus Hearing” where approximately 300teachers and students attended the hearing for a dispute over copyrightinfringement.

(II) Greater use of cases for publiclegal education
The Supreme People’s Courtparticipated in a production by the China Central Television’s (CCTV) entitled“Judge Talk (Dafaguan Shuo)” in the third season of “China Rule of Law (FazhiZhongguo Shuo)”. It was involved in the planning, scriptwriting, productionand recording, and broadcasting of the programme. This was an important joint-publicityeffort by the Supreme People’s Court and CCTV-12 in celebration of the 70thanniversary of the founding of the People’s Republic of China. Vice President ofthe Supreme People’s Court Justice Tao Kaiyuan gave a talk in one episode. Accordingto statistics, nearly 50 million viewers watched the live telecast of theprogramme. There were also 1,357 online news articles relating to theprogramme, 78 news articles published in newspapers and magazines, 151microblog comments, 99 blog articles, 2,238 WeChat articles, and 294 apparticles. The public applauded the court for its outstanding work inintellectual property protection.
The “WIPOCollection of Leading Judgments on Intellectual Property Rights: People’sRepublic of China (2011–2018)” was launched at the Second Annual WIPOIntellectual Property Judges Forum. WIPO’s legal counsel Frits Bontekoe spokeat the launch event. The forewords of the volume were written by WIPO DirectorGeneral Francis Gurry and Justice Tao Kaiyuan. This casebook of judgments givesthe global intellectual property community access to landmark judgments fromChina and allows China’s leading cases to play their demonstrative role and Chinesejudgements to create greater impact. Other key endeavours include:
The Supreme People’s Court:Organised a series of activities, including a Judgement Week and a “Judges Goon Campus” to make better use of cases to educate the public on the law, and instilgreater respect for knowledge and awareness of protecting intellectual property.When hearing important cases, the court also ensured that it invited NPCdeputies, CPPCC members, and SPC’s special supervisors and advisors as well as fellowsof the Chinese Academy of Sciences, lawyers and representatives of industryassociations to observe the proceedings and share their insights.
Beijing Xiong’an New AreaIntermediate People’s Court : Organised the “ProtectIntellectual Property Outreach Event” to educate businesses newly establishedin the area, such as Baidu, Tencent, JD and Huawei, on intellectual propertylaws and regulation.
Zhejiang High People’s Court : Established the “Zhejiang Balance (Zhejiang Tianping)” WeChat OfficialAccount, the “IP Converge (Zhi Zhi Hui)” website, and the “Zhejiang IPLaw Connect (Zhe Zhi Xi Fa)” column to lay the ground for regularoutreach activities. During the year, the court published 85 articles, and madeavailable live streaming of 26 hearings which boast of 900,000 visits.
Jiangsu High People’s Court : Organised a walkabout for the People’s Congress deputies and members of theCPPCC committee cum media event. The effort was effective and well-received.

(III) Joint outreach
The Supreme People’s Court organised the “IP JudicialProtection-Anhui Expedition”, for which selected NPC deputies, SPC’s specialsupervisors and Anhui Province’s leaders, together with the centralgovernment’s media agencies, visited some Anhui courts and key hi-tech companies.During their visits, the delegation learnt about the state of intellectualprotection in Anhui Province, innovative outcomes, and focused on discoveringthe judicial needs of commercial entities to better serve the development of innovation-basedbusinesses. Other outreach activities include the “IP Courtroom Open Day” and“IP Protection Judgement Week” during which many major cases involving advancedtechnology such as medical equipment, internet data mining and opticaltechnology were heard. The court also launched the “Faxin-IP” online project tocreate a unified big data intellectual property service platform by integratingand upgrading the existing intellectual property case guidance platform and throughresearch and development. The platform aims to provide free retrieval andconsulting services for intellectual property judges nationwide. Otherendeavours include:
Hebei High People’s Court : Combined 26-April outreach activities with the publicity campaign to promotethe “Regulations on the Protection of Olympic Symbols” to publicise extensivelythe relevant laws and regulations. It was a successful event.
Shanxi High People’s Court : Visited the province’s Comprehensive Reform Pilot Zone to find out the needs ofbusinesses and set forth requirements on how the courts should provideinnovative services to better serve businesses and create an environment thatconduces to innovation.
Tibet Autonomous Region HighPeople’s Court : Organised legal outreach activities in theChinese and Tibetan languages based on local folk customs and religious beliefsin interesting formats.
Ningxia Autonomous Region HighPeople’s Court: Organised outreach activities andconsultations, including providing on-site legal advice.

V. Greater cooperation and exchangefor greater impact in the intellectual property judicial landscape

Given the increasingly open andinclusive world, intellectual property adjudication should be based on China’snational circumstances, a global mindset, and an international vision. Itshould also promote the sharing of China’s experience and wisdom.

(I) Serving the needs ofinternational relations for the larger good
The Supreme People’s Courts has intensified thestudy of intellectual property issues emerging from foreign trade and economicnegotiations, and strengthened its adjudication guidance and supervision of thelower courts according to law.
Judges fromthe Supreme People’s Courts participated in bilateral and multilateraldialogues and exchanges, including negotiations on the “Convention on theRecognition and Enforcement of Foreign Judgments in Civil or CommercialMatters” adopted by the Hague Conference on Private International Law (HCCH). SPChas made important contributions to the satisfactory resolution of intellectualproperty issues relating to the Convention.

(II) Increasing China’s impact in theworld
In June2019, the Supreme People’s Court and WIPO co-organised the Seminar onApplication of WIPO Mediations Service in Intellectual Property Litigation,during which participants from WIPO, Singapore, the Supreme People’s Courts andour local courts shared their insights on WIPO’s alternative dispute resolutionmechanism. Director of the WIPO Arbitration and Mediation Centre Erik Wilberscommended China for being the organisation’s close partner. SPC alsoparticipated in the International Cooperation in Fighting against IntellectualProperty Right Infringement at the second China International Import Expo inShanghai, during which it shared the importance of using punitive damages todeter and prevent repeat and malicious infringing behaviour, as part of aneffort to engender a legal environment that fosters protection of intellectualproperty, that makes the infringer pay for its wrongdoing, and that sanctionsoffences.
JusticeLuo Dongchuan, Vice President of the Supreme People’s Court, held more than 20 constructivemeetings and discussions with representatives from WIPO, AIPPI, AIPLA, ICJ, the SupremeCourt of Cuba and High Court of Justice in London. Francis Gurry,director-general of the WIPO, spoken favourably of the establishment of the SPCIP Court, and said that the court embodies China’s commitment to protectingintellectual property and its determination to provide fairer and moreefficient protection for intellectual property. Abdulqawi Ahmed Yusuf, Presidentof the International Court of Justice, commended that China’s achievements inthe legal sector was not only reflected in the country’s overall effort todevelop a robust legal system, its achievements in specific areas in field ofintellectual property also deserves admiration.

(III) Widened channels of foreigncooperation
In response to the global interest in how judicial protection ofintellectual property works in China, the People’s Courts have actively engagedin dialogues through different platforms to build understanding of China’ssituation and create greater impact at the international level.
To support WIPO’s collaborativeprogrammes, our judges participated in the Roundtable on WIPO-China Cooperationand Major Intellectual Property Developments in China. We havealso send representatives to participate in WIPO’sMaster Dialogue on IP Adjudication. A delegation of patent judges visited theEuropean Union. These were occasions at which our judges shared China’s latestdevelopment and historic achievements in intellectual property adjudication.Other international activities in the year include participating in the SecondAnnual WIPO Intellectual Property Judges Forum, 9th OECD/ Korea Policy Centre(KPC) Competition Law Seminar for Asia-Pacific Judges, AIPPI Annual WorldCongress, 2019 Annual Meeting of the International Trademark Association(INTA),and the European Communities TradeMark Association (ECTA) Annual Conference, and the Japan-China-Korea IPSymposium.

VI. Capacity-building for judges aspart of an incessant effort to improve adjudication capability

Political cultivation has always been the guiding light for the People’sCourts. By continuing to develop the judges’ political awareness and by takingbig strides to revolutionise the judiciary and putting together a team offull-time, professional and specialised judges, the courts have been working atbuilding a team of intellectual property judges that have a firm politicalstand, a holistic view and international perspective, and extensive legal expertiseand technical know-how. Organisational- and people-building are key to standingthe courts in good stead for intellectual property adjudication in the new era.

(I) Ideological and politicaleducation
Given that political cultivationis our priority, the courts have organised educational activities to remind everyoneof the motto: “Do not lose sight of our original aspirations; be mindful of ourmission (buwang chuxin, laoji shiming)”. Various institutions governingintraparty political activities were also harnessed to awaken judges to theneed to guard their original aspirations and to buttress their ability to fulfiltheir mission. Platforms such as the “New Knowledge Forum” and “Forumon Intellectual Property Court” were established to enable online andoffline education and management for party-development. The courts have also adopteda party-development approach for round-the-clock online and offline educationand management. The SPC IP Court’s party branch has also won the “100 Model ofExcellence” accolade presented by Banner (“qizhi”), a magazinepublished by the State Organs Work Committee of CPC Central Committee, for the secondParty-building Innovative Outcomes Award. It was the sole recipient of theaward within the court system.

(II) Developing a sense of honour andself-discipline
The courts have managed court and partyoperations based on rigorous standards, having implemented the “Eight-PointFrugality Code (‘ba-xiang gui-ding’)” and its rules of implementation.They have also stamped out “the four forms of decadence” (i.e.formalism, bureaucratism, hedonism and extravagance) or si feng, and havedeepened the development of party ethics and clean governance and their fightagainst corruption.

(III) Building judicial capabilities
By focusing on the overallrequirements of the “five excellences (wuge guoying)”, i.e.excellence in belief, political stance, sense of responsibility, ability andbehaviour, the courts have strengthened people development at every turn. Theyhave focused efforts at building a quality team of effective, loyal, incorruptand responsible individuals to helm the courts of the new era and drive newdevelopments. The Supreme People’s court has also increased its involvement incoordinating and guiding the lower courts, and encouraged the courts to planfor the training and creation of a pool of professional intellectual propertyjudges, and the establishment of different of personnel exchange mechanisms. Toelevate judicial capabilities, the courts have also adopted many differentapproaches, including special training, thematic seminars, on-the-job training, exchanges and secondment, andobservation of court proceedings. These efforts will help build an adjudicationteam that believes in perpetual learning, which will in turn enable the courtsto adapt to new circumstances and the demands of intellectual propertyadjudication, and judges to continue building their professional capabilities.


Today’s world is defined by unprecedented changes which quicken the paceof reform of the global governance system and the international order. As thenext wave of technological revolution and industrial reform arrives withastonishing force, protection of intellectual property is confronted with newissues, new tasks and new challenges. As the People’s Courts discharge theirduties and responsibilities, they will discern new trends and circumstances,and will leverage their judicial powers to protect intellectual property. They willalso strive to provide effective judicial service and safeguards to achieve sustainedand robust economic development and social stability, build a comprehensive xiaokangsociety, and bring the 13th five-year plan to a successful completion.