Trade Mark

 

Weiguan (Shenzhen) wins dispute on the iPad trade mark

 

On 6 December 2011, a first-instance judgment was passed on the dispute over trademark ownership of iPad. Shenzhen Intermediate People’s Court ruled that it could not be established that the iPad trademark belonged to US Apple and IP Application Development Co., Ltd (IP Application).

 

In 2009, Apple and Proview International reached an agreement that Proview Electronics (Taiwan) Co., Ltd. (Taiwan Proview) would transfer the iPad global trademark to Apple for the price of 35,000 pounds. Apple asserted that Taiwan Proview had transferred all 10 trademarks to Apple, including two mainland trademarks. However, Shenzhen Weiguan argued that the iPad trademark belonged to Shenzhen Weiguan in the Chinese mainland and that Taiwan Proview had no right to sell it. Therefore, Apple had no right to use the iPad trademark in mainland markets.

 

There are two disputed points in this case:

 

a) Whether the transfer contract is binding upon the defendant

 

The first-instance court held that the trademark transfer agreement was signed by Taiwan Proview instead of between the plaintiff and defendant. The transfer of the disputed trademark was not approved by the defendant after the signing of the agreement. Therefore, the contract was not binding upon the defendant.

 

b) Whether apparent agency can be established

 

The court held that the disputed trademark transfer contract was signed between Taiwan Proview and IP Application. It is clear who the parties to the contract were. The defendant had not issued a written POA or authorized Taiwan Proview to negotiate or sign the trademark transfer contract with the plaintiff. Therefore, apparent agency could not be established and the plaintiff’s claim was dismissed.

 

Source: January 2011, http://www.chinadaily.com.cn/dfpd/jingji/2011-12/15/content_14271991.htm

 

Copyright

 

Judgment issued in one of the largest piracy publications cases in Beijing

 

On December 4th 2011, the National Office for the Elimination of Pornography and Illegal Publications announced that the “2.18” textbook piracy case involving almost 100 million RMB worth of pirated books had been concluded recently. It is the largest case of textbook piracy uncovered in Beijing since the adoption of the Special Campaign against infringement of intellectual rights and the production and sale of fake or inferior quality commodities.

 

In February, residents in Jinzhan County, Chaoyang District exposed storage facilities, which stored pirated books. A special team was created to deal with the case by the Beijing Unit of Administrative Law Enforcement for the Cultural Market and the Haidian Branch of Beijing City Public Security Bureau. During the investigation, which covered Beijing City, Shandong, Guandong and Jilin Province, the team discovered that Beijing Pengxianghongtu Book Company had played a major role in the piracy operations.

 

On September 14th, the Beijing Procuratorate of Haidian District prosecuted Mr. Chen and 5 other defendants for the crime of infringement of copyright at Haidian District Court.

 

On September 29th, Haidian District Court convicted Mr. Chen, the major offender, sentencing him to 6 years imprisonment and imposing a fine of 3 million RMB. The other 5 defendants were sentenced to between 4 and 5 and a half year prison terms and fines of between 0.3 to 1.5 million RMB were imposed.

 

Source: January 2011, http://www.ipr.gov.cn/alxdarticle/alxd/alxdbq/alxdbqgnal/201112/1270069_1.html

 

Patent

 

Beijing Double-Crane Pharmaceutical wins patent infringement lawsuit

 

The Perazone 哌舒 invention patent lawsuit, which has been fought in the courts for several years has finally came to an end. On 23 December 2011, the Supreme People’s Court held that the invention patent owned by Xiangbei Welman Pharmaceutical CO., LTD was invalid. Therefore, Double-Crane’s actions did not constitute a patent infringement.

 

Perazone 哌舒is a type of antibiotic compound preparation. In June 1997, Guangzhou Wellman Pharmaceutical Co., Ltd applied for an invention patent for it (patent No.ZL97108942.6) and was granted the patent right in 2002. In 2003, while 11 enterprises including Double-Crane Pharmaceutical, Harbin Pharmaceutical and Shanghai Pharmaceutical were all preparing to produce Perazone 哌舒 and some had already obtained production approval, they found Wellman had already obtained the patent. Enterprises including Double-crane applied to the Patent Re-examination Board (PRB) for invalidation of the patent and the Board finally decided that the patent was invalid. Wellman then claimed that the decision was wrong. The case was finally retried by the Supreme People’s Court.

 

The dispute in this case is that Guangzhou Wellman argued that it owned the patent rights to the Perazone invention patent; therefore, all production and sale of the product infringed its rights. However, 11 enterprises including Double-crane Pharmaceutical argued that related papers had already been published in foreign countries regarding contents and effects of the patent before Wellman filed an application so the use of a free public technique which was internationally recognized does not constitute patent infringement according to their opinions

 

On the basis of competent proof, the Supreme People’s Court ruled that the invention patent owned by Xiangbei Welman Pharmaceutical CO., LTD was invalid. Therefore, Double-Crane’s actions did not constitute a patent infringement.

 

Source: January 2011, http://www.ipr.gov.cn/alxdarticle/alxd/alxdzl/alxdzlgnal/201112/1273520_1.html

 

Unfair Competition

 

Jiangsu employees convicted of infringing trade secrets

 

Recently, the Nantong Intermediate People's Court in Jiangsu Province has issued a final criminal judgment in the trade secret infringement case involving two former employees of Jiangsu God Horse Power Technology Co., LTD. They were sentenced to imprisonment for two and a half years and imposed a fine of 80,000 Yuan.

 

The two employees with postgraduate degrees were employed by God Horse Co., LTD. in 2007 and 2008 as technical staff. In April 2009, they both resigned from the God Horse Company and joined Nine Days Technology Co., LTD. While working for the Nine Days Company, Mr. Liu and Mr. Li made use of technical information used at the God Horse company for the benefit of the Nine Days Technology Company. The confidential information included technical data on the production of hollow composite insulators, infringement of which has done considerable harm to the commercial interests of the God Horse Company.

 

Tongzhou District People's Court of Nantong city held that the two defendants, who apparently knew that the Nine Days Company produced similar products to the God Horse company, had breached their confidentiality agreements, stolen technical information and disclosed the information without authorization, which amounted to trade secret infringement. After the trial of first instance, the defendants both appealed against their sentences. And the Nantong Intermediate People's Court finally dismissed the appeal and the affirmed the original judgment.

 

Worker job-hopping and the flow of talent are common phenomenon in the labor market. According to statistics from the relevant departments in recent years, 80% of cases, which involved the leaking of trade secrets, occurred via this method. This type of case accounted for 20% of all intellectual property rights cases, and most of the cases occurred in scientific research departments. Preventing the leaking of trade secrets and protecting IP rights effectively are issues that many enterprises and scientific research institutions are grappling with at the moment.

 

An experienced judge at Nantong Intermediate People's Court who deals with these types of cases on a regular basis has suggested that enterprises should implement multi-level internal protection in order to achieve the best protection of confidential information. Specific measures for this are as follows: 1. put in place contact restrictions 2. Establish a trade secret registration system 3. Sign agreements 4. Sign competition restriction agreements 5. Issue appropriate confidentiality compensation 6. Improve legal awareness.

 

Source: January 2011, http://www.sipo.gov.cn/albd/2011/201112/t20111228_639027.html

 

Hong Kong

 

FREY WILLE GmbH & Co, KG and FREY WILLIE (HK) LIMITED v. COMPLEX INDUSTRIAL COMPANY LIMITED (綜合企業有限公司) and SY YEE MIU (施議錨) HCA 378/2011

 

The Plaintiffs (makers of artistic jewelry) brought an action against the Defendants on the basis of secondary infringement of copyright. The Plaintiffs sought a final injunction against the Defendants restraining them from infringing their copyright in a series of artistic works relating to bracelets.

 

The Plaintiffs originally claimed that the Defendants had had the requisite knowledge since 2009. However, they subsequently restricted their case to claiming that the Defendants had had the requisite knowledge as of the date of receiving the Plaintiffs’ cease-and-desist letter. The Judge was satisfied that the Defendants had requisite knowledge from the time they received the cease-and-desist letter.

 

Affidavits were produced by the Plaintiffs to prove the subsistence and ownership of copyright under section 121 of the Copyright Ordinance. The Plaintiffs argued that, provided the affidavit had been filed and contained the required information, then unless the Defendants served their notice, within the time limit, and attended court for cross examination, the Plaintiffs would be taken to have proved both subsistence and ownership of copyright in the copyright works referred to in the affidavit. The Defendants argued that the Plaintiffs’ evidence did not comply with the Copyright Ordinance and so could not be relied on. The judge accepted the Plaintiffs’ argument and inspected the products. He commented that even on a cursory inspection of the Defendants’ bracelets, one would realize they were reproductions of the Plaintiffs’ bracelets. Hence, the Defendants’ bracelets could only have been based on the original drawings and artistic works of the Plaintiffs’ design. The judge held that although an injunction was only a discretionary remedy, once the Plaintiffs had proven their case and the Defendants had no conceivable defense to the claims, the court was much more willing to exercise its discretion to grant the relief requested by the Plaintiffs. Although the Plaintiffs had delayed in requesting the injunction and had at the last minute abandoned the original claim that the Defendants had knowledge prior to receiving the cease-and-desist letter, the Plaintiffs were successful in obtaining the order they sought. Also, as the Plaintiffs were shown not to have acted unreasonably, they were awarded their costs.

 

Judgment dated 5 December 2011.