Avoiding China’s litigation time limits

Challenging jurisdiction could be an effective way for defendants to delay patent litigation in China, according to speakers at Managing IP's Asia-Pacific IP Forum this week

"If you are being sued and want to press for more time, you should file a jurisdiction challenge, as patent proceedings are fairly quick in China," said Singer John Huang, managing director of East IP in Beijing.

Patent litigation in China is fast, with some trials being decided in only six months. Speaking at the China session on the first day of the IP Forum, Huang explained how defendants can "buy time" and even double the length of time it takes to complete litigation in China.

Huang said that IP litigation in China has a "tight schedule" with only 15 days for a domestic defendant to respond and file an invalidation request with the Patent Reexamination Board from receiving the docket notification. This is extended to 30 days for foreign defendants. The court usually allows both parties only one month from the case being accepted to file evidence. But he added that filing a jurisdiction challenge gives a defendant an extra month. If the challenge is unsuccessful the defendant can then appeal to a higher court and get another extra month.

"The extra time is a good opportunity for collecting evidence, searching for prior art, studying the case and other litigation strategies," Huang said.

He revealed a notable trend from the 30,000 IP disputes in 2009: around 4,400 of them concerned patent litigation, but only 1,700 involved a foreign party.

"However, this does not mean that they are purely domestic disputes; most often the ultimate IP owners are foreign companies," Huang said.

Recent disputes also show a growing compensation value and greater complexity in patent infringement disputes. These include the Chint-Schneider case and German bus maker Neoplan's design patent dispute, which is now under appeal.

Huang pointed out new issues such as patent ownership issues between employees and employers, and suggested that private companies could have a covenant agreement with employees to set out reward and compensation.

Other disputes that are increasingly visible include pre-trial injunction, evidence preservation and requests for declarations of patent non-infringement.

At the same session, Gao Lulin, honorary president of All-China Patent Agents Association (ACPAA) and chairman of East IP, looked at how the third amendments of patent law are working after one year's implementation.

He said that the system of foreign filing licences for inventions created in China was working well, with SIPO taking between 15 days and one month to decide applications.

Gao discussed the implications of the Bilski case under the context of the new patent law, conflicts of Bolar exceptions in China and the US, and the introduction of absolute novelty, first filing rules and protection of genetic resources.

More than 200 delegates attended the seventh Asia-Pacific IP Forum, which was organised by Managing IP magazine and sister publication asialaw.com. The two-day event took place at the Kowloon Sheraton Hotel in Hong Kong on September 1 and 2.

(Source: Managing IP, 01 September 2010)