Specialized IP Courts in China – Judicial Governance of Intellectual Property Rights

Abstract

At the end of 2014, China introduced new specialist intellectual property (IP) courts. Although China had IP tribunals within the People’s Courts, the reform to establish separate IP courts was touted as a significant step in establishing the rule of law in the governance of IPRs in China. This is not surprising considering that an independent judiciary is central to the rule of law. This institution affirms and enforces private rights, as well as providing necessary impartiality in the process of decision-making among peer institutions. China has recently undergone several legislative reforms which amend substantive IP law. It is not surprising that this was followed by both administrative and judicial reforms. Introducing a specialized court with exclusive jurisdiction will likely affect other institutions with similar competences, e.g. general courts or administrative tribunals. Institutional choices significantly affect the outcome of decision-making because the processes of decision-making differ and will involve different stakeholders. Often, institutions move together and a change in one of them is likely to cause a change in another, even without explicit efforts to effect such changes. Therefore, any institutional reform project needs to reflect measures to contain or coordinate unintended consequences or impacts on other institutions resulting from such changes. This paper places Chinese specialized courts in a global context. We will first describe the function of a specialized IP court from a comparative institutional perspective. Next, we place the Chinese specialized IP courts in the context of the national administration-driven IP strategy to highlight the Chinese characteristics. In its analysis, this paper explores whether the perspective of institutional comparison may be applied to Chinese institutional reforms. It also argues that the rationale for introducing specialized IP courts in China may be more than merely improving technological competence and concentration of expertise of the court; it signals a step towards independent judicial decision-making, towards the establishment of the rule of law and market-oriented decision-making.

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Fig. 1

Notes

  1. 1.

    National People’s Congress of the People's Republic of China (2014); Supreme People’s Court of the People's Republic of China (2014). See also Li (2014), pp. 303–317.

  2. 2.

    It has been reported that by the end of 2013, there were 410 tribunals established within courts, in every high court and in many intermediate courts. See Li (2014), p. 304. See for the general structure of Chinese courts, Chen (2016), pp. 179–195.

  3. 3.

    See Li (2016b), pp. 304–306.

  4. 4.

    Raz (1979), pp. 210–219.

  5. 5.

    Bakardjieva Engelbrekt (2007), p. 65. North (1990).

  6. 6.

    Li (2016a), p. 65.

  7. 7.

    Komesar (1994), p. 23.

  8. 8.

    Ruskola (2013).

  9. 9.

    Raz (1979), p. 212.

  10. 10.

    Komesar (1994), p. 3.

  11. 11.

    See also for similar insights expressed by Buchanan (1989), p. 59.

  12. 12.

    Komesar (1994), p. 23.

  13. 13.

    Tamura (2008), pp. 11–20 (in Japanese). Bakardjieva Engelbrekt (2007), p. 71. See also Rai (2003), p. 1039.

  14. 14.

    See, however, a sceptical view on the role and function of the administrative agencies in the US Constitution, Epstein (2008), p. 491.

  15. 15.

    In an earlier work by the co-author, Lee has examined the dilemma of keeping legislation general enough not to become outdated and yet specific enough to form binding rules through the lens of the “technological neutrality” principle in the TRIPs Agreement. See Lee (2016), pp. 362–363.

  16. 16.

    See a comparison of legislation and common law by Nard (2010), p. 99.

  17. 17.

    Epstein (2008), pp. 492–493.

  18. 18.

    Datla and Revesz (2013); Komesar (1994), pp. 82–97; Rai (2003).

  19. 19.

    Radin (1993), p. 56. See also Radin (1996).

  20. 20.

    Komesar (1994), pp. 149–150. Nard (2010), p. 101.

  21. 21.

    Raz (1979), pp. 212–219. Komesar criticizes this as it places undue importance on the court which then defers to the political process, facing a complexity of the facts, Komesar (1994), pp. 165–173.

  22. 22.

    For a discussion on rules versus standards in the law, see Schlag (1985). See also Kaplow (1992).

  23. 23.

    Menell (2013), pp. 63–88. See also Liddell and Waibel (2016).

  24. 24.

    See, however, how this effort to future-proof the law is impossible, Moses (2007).

  25. 25.

    See generally Lemos (2013), pp. 89–106, on the presence of “common law statutes” in the US which invite courts to make law.

  26. 26.

    For example, harmonization of the standard of originality in copyright in the EU seems to be entirely based on the case law of the CJEU and its interpretation of copyright directives, often characterized as judicial activism, Rosati (2013). This trend is noticed in the landmark decisions on originality such as Infopaq, FAPL, Painer and subsequent cases. Infopaq Int’l A/S v. Danske Dagblades Forening, CJEU, C-5/08, ECR I-6569, ECLI:EU:C:2009:465 (2009). Football Association Premier League Ltd and Others v. QC Leisure and Others, CJEU C-403/08, ECLI:EU:C:2011:631 (2011). Eva-Maria Painer v. Standard Verlags GmbH and Others, CJEU C-145/10, ECR 2011, I-12533 ECLI:EU:C:2011:798 (2011).

    A similar trend is also noticed in trademark law where the Court seemed to create the notion of a new function of a trademark, which is an expression that is not visible in the trademark regulation nor in the directive, L’Oréal v. Bellure, CJEU C-487/07, 2009 I-05185, ECLI:EU:C:2009:378 (2099). See for a commentary on such a tendency of the CJEU, Kur et al. (2009).

  27. 27.

    See for a general description of courts among the institutions in China, Chen (2016).

  28. 28.

    Guangxi Broadcasting Newspaper Office v. Guanxi Coal Mine Worker’s Newspaper Office on TV List Right Dispute (1996). Supreme People’s Court Gazette, 1996.1 (In Chinese: 广西广播电视报社诉广西煤矿工人报社电视节目预告表使用权纠纷案 《中华人民共和国最高人民法院公报)1996年01期).

  29. 29.

    Taoyi v. Beijing Municipal Subway Foundation Engineering Company on Patent Ownership Dispute (1992). Supreme People’s Court Gazette, 1992.3 (In Chinese: 陶义诉北京市地铁地基工程公司发明专利权属纠纷案’ 中华人民共和国最高人民法院公报1992.3). Hong Kong Meiyi Metal Products Factory v. Board of Patent Appeals of Patent Office on “Idler Clamp Door” Invention Patent Dispute Appeal (1992). Supreme People’s Court Gazette, 1992.2 (In Chinese: 香港美艺金属制品厂诉中国专利局专利复审委员会确认“惰钳式门”发明专利权纠纷上诉案’ 中华人民共和国最高人民法院公报1992.2). DuPont v. Beijing Guowang Information Co., Ltd. on Domain Name Infringement Dispute in Computer Network (2002), Supreme People’s Court Gazette, 2002.3 (In Chinese: 美国杜邦公司诉北京国网信息有限公司计算机网络域名侵权纠纷案’, 中华人民共和国最高人民法院公报 2002.3).

  30. 30.

    In patent law, for example, the doctrine of equivalents is one such example that is now found in various jurisdictions. Similarly, in cases with complex facts (technological facts, which are litigated in various countries, courts have a tendency to informally harmonize their practices). See Lee and Li (2016).

  31. 31.

    De Werra (2016).

  32. 32.

    For example, TRIPs Agreement, Art. 58.

  33. 33.

    For example, TRIPs Agreement, Art. 61.

  34. 34.

    See, for example, People’s Republic of China Patent Act, Arts. 3, 60–61, 63–64, on patent counterfeiting; Copyright Act, Arts. 7, 48; Trademark Act, Arts. 2, 60–62. See comment by Li (2014), pp. 143–157. For a general description, see Nie (2006), pp. 217–226. See also Chen (2016), pp. 802–810; Dimitrov (2009), pp. 115–145.

  35. 35.

    See, for example, what is allowed for the member states as provided in the TRIPs Agreement, Art. 41 et seq.

  36. 36.

    See, for example, Pegram (2000). See also Rai (2002). In contrast, on the danger of specialist courts, Rifkind (1951).

  37. 37.

    Regulation (EU) 1257/2012 (2012) Implementing enhanced cooperation in the area of the creation of unitary patent protection, OJEU L361/1–8, UPR; Regulation (EU) 1260/2012 Implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the application translation arrangement, OJEU L361/89–92; Agreement on a Unified Patent Court, Document No. 16351/12 (11 January 2013).

  38. 38.

    See generally De Werra (2016), p. 22, reporting such trends in Austria, China, Finland, and Russia.

  39. 39.

    The IP High Court was created as a result of implementing the Basic Law on Intellectual Property (2003) in 2005, after several years of attempts at subject matter forum centralization with exclusive subject matter jurisdiction in the division of the district courts and high courts (Tokyo and Osaka). Tokyo High Court (some subject matters) and the IP High Court each have exclusive jurisdiction on IP matters by virtue of Art. 6(3) of the Code of Civil Procedure, and Art. 2(1) of the Law for Establishing the IP High Court. The IP High Court is the court of first instance for all appeals against decisions of the JPO.

  40. 40.

    Korea has had a general patent court since 1998. Article 3(1) of the Court Organization Act. The court has exclusive jurisdiction on limited subject matters of validity, as designated by Art. 186(1) of the Patent Act, Art. 75 of the Design Act, Art. 86(2) of the Trademark Act, and other first-instance proceedings such as under Art. 105 of the Seed Industry Act. The Patent Court has exclusive jurisdiction over all cancellation appeals from diverse decisions rendered by the Intellectual Property Tribunal of KIPO.

  41. 41.

    Community trademark and design court, Art. 95 Council Regulation (EC) No. 207/2009 of 26 February 2009 on the European Union trade mark (codified version) (Text with EEA relevance) and Art. 80 Council Regulation (EC) No. 6/2002 of 12 December 2001 on Community designs (OJ EC L 3 of 5 January 2002, p. 1).

  42. 42.

    Germany has had the Federal Patent Court (Bundespatentgericht) since 1961, based on Art. 96(1) of the Basic Law of the Federal Republic of Germany. The court has jurisdiction for rulings on appeals against decisions of the German Patent and Trade Mark Office and actions for the declaration of nullity of German patents and of those European patents in Germany.

  43. 43.

    The UK has a patent court and the IP Enterprise Court for specialist subject matters, but the judges in the patent court are said to be generalist as they would also hear non-IP matters. By combining the specialist courts with judges who are also exposed to general cases, the UK seems to avoid the problems of the bias of specialist courts.

  44. 44.

    The Court of Appeals for the Federal Circuit is a specialized court as it has exclusive jurisdiction over patent matters on appeal, but it also has jurisdiction over other subject matter.

  45. 45.

    See Posner (1982). Since its creation, the court has been heavily criticized for a pro-patent bias in its rulings. Dreyfuss (1989); Nard and Duffy (2007).

  46. 46.

    See a commentary on the background of the agreement, Ullrich (2012), pp. 243–294. See also Petersen et al. (2015).

  47. 47.

    TRIPs Agreement, Art. 1(1) states: “Members shall give effect to the provisions of this Agreement. Members may, but shall not be obliged to, implement in their law more extensive protection than is required by this Agreement, provided that such protection does not contravene the provisions of this Agreement. Members shall be free to determine the appropriate method of implementing the provisions of this Agreement within their own legal system and practice.”

  48. 48.

    TRIPs Agreement, Art. 41(5).

  49. 49.

    Komesar (1994).

  50. 50.

    See, for example, Pedraza-Farina (2015), p. 89.

  51. 51.

    Montgomery (2010), p. 13. See also Dean (2010).

  52. 52.

    Zhang (2016), pp. 189–212. See also Prud’Homme (2016), pp. 13–74.

  53. 53.

    See, for example, Yu (2016), pp. 20–42.

  54. 54.

    See also Alford (1995); Pang (2012).

  55. 55.

    See Art. 10 of Beijing Municipal Higher People’s Court Guidance on the Determination of Copyright Infringement Liability for Damages.

  56. 56.

    See Art. 15 of Jiangsu Provincial Higher People’s Court’s Guidance on the Determination of Fixed Amount of Damages for Intellectual Property Infringement.

  57. 57.

    Liu (2005). See also Chen (2011), pp. 208–212.

  58. 58.

    Chen (2011), p. 190, stating that there is a theoretical possibility of independence, citing Art. 126 of the 1982 Constitution of China.

  59. 59.

    Chen (2011), pp. 173–191.

  60. 60.

    See Yu (2013).

  61. 61.

    Liu (2005), p. 38.

  62. 62.

    Chen (2011), pp. 191–195.

  63. 63.

    Woo (1999), p. 591.

  64. 64.

    See, for example, Tao (2007), p. 109. See also Thomas (2007), pp. 94–100.

  65. 65.

    Kong (2008), p. 26.

  66. 66.

    Woo (1999), p. 586.

  67. 67.

    Supreme People's Court of the People's Repubic of China (2009).

  68. 68.

    Ibid.

  69. 69.

    Ibid.

  70. 70.

    Kong (2008), p. 26.

  71. 71.

    Ming (2012), pp. 10–14.

  72. 72.

    Chen (2011), pp. 291–313.

  73. 73.

    Yu (2013).

  74. 74.

    State Council of the People’s Republic of China (2008).

  75. 75.

    Zhang (2016), pp. 189–209.

  76. 76.

    Xiao (2003), pp. 8–9.

  77. 77.

    Xiao (2003), pp. 9–10.

  78. 78.

    Wu (2015), pp. 44–45.

  79. 79.

    Zhang (2013), p. 30.

  80. 80.

    Supreme People’s Court of the People’s Republic of China (2014a).

  81. 81.

    See Li (2016a, b). See also Zhao and Bruun (2016), pp. 318–336.

  82. 82.

    State Council of the People’s Republic of China (2008).

  83. 83.

    State Council of the People’s Republic of China (2008), para. 45.

  84. 84.

    National People’s Congress of China (2014).

  85. 85.

    Supreme People’s Court of the People's Republic of China (2014).

  86. 86.

    Lin (2015), p. 23.

  87. 87.

    On 3 November 2014, the SPC issued the Supreme People’s Court’s Regulations on Jurisdiction of Cases of the IP Courts in Beijing, Shanghai and Guangzhou.

  88. 88.

    Su (2015), p. 15.

  89. 89.

    See Art. 4 of Supreme People’s Court of the People’s Republic of China (2014b).

  90. 90.

    China Patents and Trademarks (2015).

  91. 91.

    Lin (2015), p. 23.

  92. 92.

    China Patents and Trademarks (2015).

  93. 93.

    See Su (2015), p. 16; Lin (2015), p. 23. See also Li (2015), p.15.

  94. 94.

    Su (2015), p. 18; Lin (2015), pp. 20–21.

  95. 95.

    See Jing (2016).

  96. 96.

    Article 48 of China Copyright Act 1990 amended in 2010; Arts. 60, 62 of China Trademark Act 1982 amended in 2013.

  97. 97.

    See, for example, Wen et al. (2008); Li (2012), pp. 236–249. Cf. Sherman (1995), pp. 15–40.

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Acknowledgements

Nari Lee would like to thank Professor Lionel Bently and Dr. Henning Grosse Ruse-Khan of the Centre for Intellectual Property and Information Law at the faculty of law, Cambridge University, who hosted her during the research visit in 2016.

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Lee, N., Zhang, L. Specialized IP Courts in China – Judicial Governance of Intellectual Property Rights. IIC 48, 900–924 (2017). https://doi.org/10.1007/s40319-017-0642-6

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Keywords

  • Specialized IP Court
  • China
  • IP
  • Institutional comparison
  • Rule of law