CHINESE COURT ISSUED A JUDGMENT OF INTELLECTUAL PROPERTY INFRINGEMENT WITH A COMPENSATION OF 50MILLION YUAN
By Liaoliang Zhang
The Special Court in Beijing for intellectual property rights (IPR) cases pronounced publicly a judgment of patent infringement according to the law, on December 8, 2016. The first instance judgment of the court is that the defendant (HENGBAO CO., LTD.) should compensate the plaintiff (Watchdata Group) economic losses of 49 million yuan and the reasonable litigation expenditure of 1 million yuan, up to 50 million yuan. This is the highest amount of compensation since the Special Court in Beijing for intellectual property rights (IPR) cases was established.
This case deals with patent infringement disputes of smart password key (USBKey) products in the financial domain. In the case of confirmation that the defendant infringed the plaintiff's patent rights, the plaintiffs claimed that the actual loss of the plaintiff could be calculated by multiplying the number of actual sales of infringement products and the reasonable profits of each patented product, and the calculated actual loss of the plaintiff was 49 million. Thus the plaintiff requested the defendant to compensate economic losses of 49 million yuan in accordance with stipulations concerning infringement compensation in Patent Law of the People's Republic of China, and this claim was supported by the court. In addition, the plaintiff requested the defendant to compensate attorney fees of 1 million yuan calculated by the hour, and this claim was also supported by the court.
It should be noted that this is the first time the Special Court in Beijing for IPR cases confirmed, in the judgment, that the attorney fees calculated by the hour were acceptable. As to whether the attorney fees of 1 million yuan that the plaintiff calculated by the hour was reasonable, after the court mainly took the necessity of the agent, the difficulty of the case, the actual work of lawyers and the like into consideration, the court deemed that the compensation of 1 million yuan for attorney fees claimed by the plaintiff was reasonable and deserved full support.
This judgment of intellectual property infringement with a compensation of 50 million yuan indicates that China is trying to strengthen the protection of intellectual property rights, increase the intensity of sanctions on serious infringements, such as malicious infringement, repeated infringement and the like, fit the amount of compensation with the market value of intellectual property, take the reasonable litigation expenditure, such as the attorney fees, into consideration, increase the cost of infringement and safeguard the rights of patent holders. This judgment will encourage intellectual property owners to hire a professional lawyer to fully safeguard their own interests in seeking judicial relief.