CHINA INTELLECTUAL PROPERTY LAW NEWSLETTER
Vol. 4 , No.9 - June 26, 2003
TOPICS THIS ISSUE:
- Honda Suit Shows Flaws In China's Patent System
- Chinese Firm Applies For 'Aomori' Trademark
- Japanese Firms To Charge Patent Fee On Digital Cameras
- Patent Protection Not Sufficient
- Equality Before The Law
Honda Suit Shows Flaws In China's Patent System
This is a continued report on the recent legal victory by Honda Motor against the Chinese government.
As reported earlier, Honda Motor won a lawsuit against the Chinese government to restore the company's motor scooter design patent. This victory by Honda Motor is a good sign that China has moved a step closer to international standards in its judicial approach to design patents.
The court decision also revealed that the Chinese system, which allows patents to be registered without examination, poses setbacks to design patent suits.
In industrially advanced countries such as Japan, design patent ownership is determined by the total appearance of the product and its major components, such as the shape of the handlebars and the mirror in the case of scooters.
In many patent-related disputes in the past, China's State Intellectual Property Office, which registers patents, and court rulings rarely take into account the shape of the product's main components, concentrating on visual similarity and the impression of the overall design. As such, products patented as original designs in Japan run the risk of being considered copied products and treated as pirated in China. However, this new ruling took into account the shape of the main components of the Honda Motor scooter.
This is considered the first step in changing the criteria for approving design patents in China and raising them to international standards.
As reported, Honda's design patent dispute began in 1997, when the automaker filed suit against three Chinese manufacturers, claiming that they had infringed Honda's design patent by producing scooters similar to the Honda models. The three companies in return filed claims with the China State Intellectual Property Office arguing that Honda's scooters were "identical" to products from Taiwan and requesting that Honda's patent be revoked.
In response to the request by the three companies, the Chinese authorities canceled Honda's scooter patent. This action by the Chinese authorities lead Honda to file a lawsuit to have the patent cancellation reversed, and the case went to the appeals court.
Under the Chinese patent system, in which producers are granted design patents without examination, even copied products can be registered for patents.
To file a claim over design patent infringement in China, the plaintiff and the defendant must first determine the ownership of the design patent.
Honda waited six years to get its scooter design patent approved. The company has yet to decide whether to claim for intellectual property infringement.
(Source: The Daily Yomiuri)
Chinese Firm Applies For 'Aomori' Trademark
A Chinese firm has applied to register the name "Aomori" as a trademark for selling fruits and vegetables. This move may force the prefecture's agricultural industry to stop labeling their products as those produced in the prefecture if they are exported to China.
The Aomori prefectural government is trying to find out more details through the Japan External Trade Organization.
Kyoei, an apple sales firm in Kuroishi in the prefecture came to know of the application when it received a letter from a patent law firm in Taiwan.
According to the report, a Chinese official gazette issued in April announced that a Chinese company had applied to register the name, written in Chinese characters, as its trademark. If no objection was filed within three months, the applicant would be given the right to prevent other firms from using the said trademark for products or services in China.
It was confirmed by JETRO's Beijing office that the announcement was printed in the Chinese government's gazette, and the office is checking to see if the application for the trademark will be limited only to agricultural products.
It was also reported that if the said trademark is registered, exports from Aomori Prefecture to China are likely to be seriously affected. The prefectural government's agricultural, forestry and fisheries department has dispatched two officials to Tokyo to collect more information from the Agriculture, Forestry and Fisheries Ministry and the Patent Office.
Currently, Aomori Prefecture exports only seafood products such as scallops and squid to China and not fruits and vegetables.
According to JETRO, it is prohibited under the Chinese legal system to register famous foreign geographic names as trademarks. A JETRO official said it was likely the Chinese firm and judicial officials did not realize that "Aomori" is a geographic name.
(Source: The Daily Yomiuri)
Japanese Firms To Charge Patent Fee On Digital Cameras
There are indications that Japanese companies will exercise intellectual property rights strategies on digital cameras manufactured in China.
The fast-growing domestic market may encounter patent issues. Japanese companies are trying to use a new patent intellectual property rights strategy to strike Chinese manufacturers. According to a senior manager from a local digital camera maker, the move is to charge patent fee on digital cameras just as they did on DVD players.
Previously, there was news that an intellectual property rights executive of a Japanese organization indicated that digital camera patent would soon become a focus of the industry. However, it remains unclear whether Japanese corporations could finally succeed.
Sources say that Japanese Patent Lawyer Association had already published details about their patent agents in China on its website in mid-April.
At present, Japanese companies such as Sony, Fuji, Olympus, and Canon and US manufacturers represented by Xerox and Kodak grasp most patent technologies in digital cameras.
A foreign market survey firm forecasts that digital camera sales in China will increase to US$495 million in 2003.
(Source: SinoCast)
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Patent Protection Not Sufficient
Wary as New Zealand firms may be of corruption, protecting intellectual property and getting paid for their work, they cannot ignore the potential of China.
NZ Trade export award-winning Wellington company Windsor Engineering said the company's first foray into China with its mammoth lumber-drying kilns left it cautious but encouraged. John Griggs, a marketing man at Windsor said: "It does have huge potential, although at the moment it is not a key market for us." The main markets for Windsor are Australia, Chile, South Africa and South Korea, but with marketing material being produced for China, Windsor is focusing this direction.
They are not alone. According to Griggs, China is quite short of timber suitable for furniture so they import a fair bit of radiata pine from New Zealand, from companies like Evergreen Forests. Griggs also said that New Zealand is gradually going to become saturated with drying capacity so they have to look to export markets like Chile, South Africa and Korea, and now China.
Griggs said its sale of a single wood-drying kiln, was eye opening. In addition to the problems with local contractors and bureaucracy, issues of prompt payment for services and piracy of intellectual property for the design of its kilns had left the firm nervous.
One of the company's main intellectual property concerns is copying. "If you supply kilns, a couple of years later someone is building them. Patents aren't worth the paper they are written on because enforcing them is difficult," Griggs said.
Having dipped its toe into China using the local contacts and Chinese office of Evergreen Forests, Griggs encouraged firms to make use of similar relationships.
"We simply would not have had the wherewithal to go to China to sell our kilns by ourselves. You need the local contacts and market and cultural knowledge."
(Source: Sunday Star Times)
Equality Before The Law
Xu Jianping, a scientist and president of a textile company in Zhejiang Province, killed and dismembered his wife after an angry domestic quarrel. As a result thereof, he was sentenced to death in April. This should have been an ordinary criminal case, if not for the appeal for a lesser sentence by nearly 200 scientists and professionals.
The extraordinary argument raised by the appellants to spare Xu's life was that he held about ten intellectual property patents, which is a remarkable contribution to China. As such, his life ought to be spared as his professional expertise in the software he developed could save billions of yuan for the textile industry.
But the arguments made by those scientists and professionals do not hold water. Such a proposal would seriously jeopardize the sacred principle of "all are equal before the law". That principle is the cornerstone of judicial justice.
The message that it conveys is that all should face the judgment of the law, regardless of who he or she is. If that principle is not respected, there will be excuses raised to circumvent the law, depriving it of its universality and credibility.
According to the critics, if a scientist can be excused because of his or her contributions, others such as a famous writer, a prominent teacher or a high-ranking government official may also be pardoned if they violate the law.
As the country presses ahead with its judicial reform, judicial justice is the last defense of social justice. No one should enjoy privileges above or beyond the principles of law, regardless of their social status.
(Source: China Daily)
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The China Intellectual Property Law Newsletter is intended to be used for news purposes only. It should not be taken as comprehensive legal advice, and Lehman, Lee & Xu will not be held responsible for any such reliance on its contents.
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