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Mark Perry Editor  

Global Governance

of IntellectualProperty in the

21st CenturyReflecting Policy Through Change

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Global Governance of Intellectual Propertyin the 21st Century

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Mark Perry

Editor 

Global Governance of Intellectual Property

in the 21st CenturyReflecting Policy Through Change

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 Editor Mark PerrySchool of LawUniversity of New England

Armidale, Australia

ISBN 978-3-319-31176-0 ISBN 978-3-319-31177-7 (eBook)DOI 10.1007/978-3-319-31177-7

Library of Congress Control Number: 2016940952

© Springer International Publishing Switzerland 2016This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations,recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmissionor information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed.The use of general descriptive names, registered names, trademarks, service marks, etc. in thispublication does not imply, even in the absence of a specific statement, that such names are exemptfrom the relevant protective laws and regulations and therefore free for general use.The publisher, the authors and the editors are safe to assume that the advice and information in thisbook are believed to be true and accurate at the date of publication. Neither the publisher nor theauthors or the editors give a warranty, express or implied, with respect to the material contained

herein or for any errors or omissions that may have been made.

Printed on acid-free paper 

This Springer imprint is published by Springer NatureThe registered company is Springer International Publishing AG Switzerland

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 For Priti

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Preface

This book is aimed at reaching all people interested in the global evolution of 

intellectual property. This probably means every thinking person, as who could not

be interested in one of the underlying foundations of the diverse societies that

coexist today? Readers who are inventors, artists, and marketers will no doubt

gravitate to the parts that focus on patent, copyright and trade marks, but this would

be a narrow approach. The editor asks readers to contemplate the work as a whole,

and to see how the authors who come from Australia, Canada, China, India, Italy,

Nepal, Thailand, the United Kingdom, and the United States of America reflect

on issues in the globalised world of intellectual property. Other states are alsoconsidered by the authors in their various chapters, giving a broad international

perspective.

The provenance of this work started with the idea for a collaboration between

Beijing Foreign Studies University and the University of New England (Australia)

for a conference in the area of intellectual property. This rapidly developed into a

conference in May 2015, Intellectual Property Facing the 21st Century: Flux in the

 Force, with a theme following the changes in the foundations of intellectual

property as seen through developments in a wide span of jurisdictions. Over the

last decade, approaches to intellectual property have been in a state of flux.Although fundamental precepts remain the same, the emphasis on the directions

being taken are changing around the world. This in turn led to the chapters in this

book. Not all speakers are authors of this work, and not all contributors were

speakers, but they have seized the idea of representing changes in the jurisdictions

that they examine, which can be seen as allegories for changes in the global

governance of intellectual property.

Readers may be surprised at the diversity of approaches to intellectual property

in what is often portrayed as a globalised collection of rights over the intangible,

and this is addressed in the first chapter. The following chapters are roughlygrouped by area of intellectual property addressed, but there is no clear-cut line

as intellectual property rights are not living in isolated silos. They could have been

grouped by type of state or geographical region, but again there are very strong

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interrelationships between national intellectual property developments. The threads

and connections between chapters are left to the reader. The themes include the

exercise of power by governments and industry, dominant states in governance,

health, innovation, disability, the Internet, branding, crime, investment and

patentomics. Readers should find issues on which they sympathise, agree and

dissent and others for which they are upset and happy. It is after all the reader 

that makes the book.

Armidale, NSW, Australia Mark Perry

January 2016

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Acknowledgements

A work such as this depends on the direct input from many people and indirect

influences from thousands. However, convention suggests that most would like

mention in person, and although this is not possible, there are some to thank

specifically. Starting temporally at the end, Springer clearly has had a great role

in bringing this work to your hands or screen, in particular Dr Brigitte Reschke,

Executive Editor Law, for taking on this project and Manuela Schwietzer for her 

editorial assistance to get the work to press. The beginning of this project has its

origin at Beijing Foreign Studies University, with Dean Meng Wan and Associate

Professor Lijuan Liu co-hosting the IP Flux conference at their university in 2015together with the University of New England. There has been a great deal of work

done by many people in between these two times, taking a year, and in addition to

the contributors, thanks must go to those peer reviewers who remain anonymous

and often unthanked for their quick work in providing excellent feedback on the

chapters herein.

Dr Kylie Lingard, apart from co-authoring a chapter with me, provided immense

assistance in preparing the materials. To the many others who helped, including my

relatively new colleagues and friends at the University of New England, Armidale,

NSW, Australia, who often provide assistance without even knowing—a word, or athought-provoking comment—I give my thanks. Of particular importance is Dr 

Priti Krishna for her encouragement and her own stamina for scholarly pursuit that

provides daily inspiration.

I thank you all.

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Contents

The Changing Face of Intellectual Property: Global Forces andCompliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Mark Perry

Prior Art Defence in the Chinese Patent System . . . . . . . . . . . . . . . . . . 11Lijuan Liu

Bio-Patent Pooling and Policy on Health Innovation for Access toMedicines and Health Technologies that Treat HIV/AIDS: A Need for

Meeting of [Open] Minds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29Sunita Tripathy

Patent Exhaustion on Trial in the United States . . . . . . . . . . . . . . . . . . . 51Shubha Ghosh

Code, Autonomous Concepts and Procedure: Stepping Stones forEuropean Law? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71Alison Firth

The Harmonisation of EU Copyright Law: The Originality Standard . . . 85Thomas Margoni

International Copyright:  Marrakesh and the Future of Users’Rights Exceptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107Margaret Ann Wilkinson

Moments of Flux in Intermediary Liability for Copyright Infringementin Australia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129Nicolas Suzor, Rachel Choi, and Kylie Pappalardo

The Evolution of Domain Names and Their Impacts on Trade MarkRights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151Heather Ann Forrest

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Non-conventional Trademarks Under United States Law:An Unbounded New Frontier of Branding . . . . . . . . . . . . . . . . . . . . . . . 173Llewellyn Joseph Gibbons

The ASEAN Single Market: A Perspective on Thailand’s Trade Mark

Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193Kanya Hirunwattanapong

Intellectual Property Rights and Foreign Direct InvestmentAgreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 209Ramesh Karky

Innovation Cartography and Patentomics: Past, Present and Future . . . 225Kylie Lingard and Mark Perry

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Brief Information on Contributors

Rachel Choi   recently completed Bachelor degrees in Law and Film, TV andScreen from the Queensland University of Technology in Brisbane, Australia.

With a working knowledge of film production and film festivals, Rachel’s enthu-

siasm for the arts underpins her interest in intellectual property, media and Internet

law. Rachel is a law graduate at a national law firm where she started as a paralegal

in the Intellectual Property and Technology group.

Alison Firth   originally studied physics, but curiosity about patents led her into thelaw, first into legal practice at the English Bar, then to academic posts. Her research

interests cover the laws of intellectual property and their interaction with other areas

of law, such as contract and competition law. She is Vice-President of the British

Literary and Artistic Copyright Association. She enjoys swimming and visiting well-

stocked law libraries. Topics of recent papers, talks and publications include devel-

opments in UK patent law and procedure, copyright exceptions for libraries and

archives, co-authorship and co-ownership of copyright in musical works, European

trademark norms in the context of the proposed Transatlantic Trade and Investment

Partnership and the Trans-Pacific Partnership, reception of EU trade mark laws in

New Zealand, the account of profits in relation to the EU’s IP enforcement directive,

essential facilities and other issues of competition in copyright.

Heather Ann Forrest   is the Vice Chair of ICANN’s Generic Names SupportingOrganization (GNSO) Council representing the Non-Contracted Parties House. She

is a member of the leadership of ICANN’s Intellectual Property Constituency (IPC)

and represents the IPC on the GNSO Council. She serves as a co-chair of the CWG

on the Use of Country and Territory Names as Top-Level Domains. She is an

Associate Professor at the University of Tasmania. Her research focusses on the

interaction of international law, particularly relating to rights in names, and Domain

Name System policy. Her doctoral thesis, Protection of Geographic Names inInternational Law and Domain Name System Policy, is recognised as the global

authority on legal rights in geographic names and their use in the Internet Domain

Name System.

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Shubha Ghosh   is the Crandall Melvin Professor of Law and Director of theTechnology Law Center at Syracuse University College of Law in Syracuse,

New York. He has written well-cited articles in the fields of intellectual property

policy, doctrine and commercialisation. He earned his BA from Amherst College,

his MA and PhD in Economics from Michigan and his JD from Stanford. He has

travelled extensively in Asia and Europe, learning and lecturing about the design of 

social institutions for the promotion of innovation, openness and distributive

 justice.

Llewellyn Joseph Gibbons   researches in the area of the intersection of law andtechnology in creating new governing structures as well as their effect on economic

and cultural development. Llewellyn Joseph Gibbons is a professor of law at the

University of Toledo where he coordinates the intellectual property law

programme. He is also a fellow at the Intellectual Property Center of ZhongnanUniversity of Law and Economics (Wuhan, China). Llewellyn Joseph Gibbons has

written articles in the areas of intellectual property and economic development, the

governance of cyberspace, the role of mass market contracts in ecommerce trans-

actions and the use of arbitration as a means on online dispute resolution. Llewellyn

Joseph Gibbons’  articles have been cited by federal and state courts in the United

States.

Kanya Hirunwattanapong   is the Assistant Dean for Foreign Affairs at theFaculty of Law and the Head of the European-ASEAN Legal Studies Unit at

Chiang Mai University, Thailand. She has taught intellectual property law andthe European Union law and is actively involved in organising IP activities

with both the Central Intellectual Property and International Trade Court and the

Intellectual Property Department. She has been a guest lecturer on IP and EU and

ASEAN Law. She earned her BA and MA in Law at Chulalongkorn University

and MA in Law (European Union Law) at Exeter University, UK. She has currently

written the following: (1) the series of   Thai Intellectual Property Laws   (the first

one in the series is Thai Patent Law, and the second book is Thai Trade Mark Law)

and (2)   The Judicial Control in the European Union: Lessons for the ASEAN 

Community  (first draft).

Ramesh Karky   specialises in the international economic law, intellectualproperty law and biotechnology law areas and has served as an international expert

consultant, Visiting Professor of Law, researcher and lawyer. Karky holds Diploma

in Law (LLB) from Tribhuvan University in Kathmandu, LLM from the Vrije

Universiteit Brussels and SJD from Golden Gate University in San Francisco and

completes three year ’s postdoctoral training in Law at Western University, Canada.

He was also an Invited Researcher at the Japanese Institute of Intellectual Property

(part of Japanese Patent Office).

Kylie Lingard   is a Postdoctoral Research Fellow with the Australian Centre for Agriculture and Law, at the University of New England (Australia). Her research

areas include legal measures to better support the interests of indigenous peoples in

their traditional resources and knowledge, legal duties to consult indigenous

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peoples in land-use decision-making and equitable management policies for plant

material collections. Lingard’s PhD research looked at strategies to advance the

interests of Aboriginal and Torres Strait Island peoples in the commercialisation of 

their traditional foods.

Lijuan Liu   is Associate Professor, Beijing Foreign Studies University LawSchool, in Beijing, China. Lijuan has a PhD from Chinese Academy of Social

Science and a Master from Beijing University Law School. Research includes

especially trademark and unfair competition law. Teaching includes intellectual

property law for undergraduates, trademark law for postgraduates and intellectual

property law frontiers for postgraduates.

Thomas Margoni   is a Lecturer/Assistant Professor at the School of Law, Univer-sity of Stirling, UK. His research and teaching interests concentrate on the rela-

tionship between law and new technologies from an EU, comparative andinternational point of view. He has published extensively in the field and teaches

courses in intellectual property and internet law. Dr. Margoni is a regular speaker at

national and international conferences, is a Marie Curie grant holder and conducts a

variety of studies for EU and international institutions, including the European

Commission, the Organisation for Economic Co-operation and Development

(OECD), the Office for Harmonisation in the Internal Market (OHIM) and the

Japanese Patent Office.

Kylie Pappalardo   researches in intellectual property and innovation law, focus-sing primarily on the intersection between copyright and creativity and on the rights

of copyright users. She is a Lecturer in the Law School at the Queensland Univer-

sity of Technology (QUT), where she leads the research programme on copyright

law and creative communities. Kylie has recently completed her PhD on the

regulation of ISPs and other Internet intermediaries for online copyright infringe-

ment. She holds degrees in Law and Creative Writing from QUT and a Masters of 

Law from Georgetown University in Washington D.C. Kylie has been a senior 

researcher with the Open Access to Knowledge (OAK) Law Project and with

Creative Commons Australia. She has also worked with the Arts Law Centre of 

Queensland and served on the board of Youth Arts Queensland.

Mark Perry   is Professor of Law at the University of New England, Australia andBarrister and Solicitor of the Law Society of Upper Canada. He is also Professor 

Emeritus of Computer Science at Western University in Canada. His research is on

the nexus of Science and Law, in particular focussing on biotechnology and

intellectual property. Professor Perry has prelected audiences around the world,

including Brazil, Bhutan, China, Italy, India, Japan, New Zealand, the United

States, the United Kingdom and Australia. He has been an invited and keynote

speaker at many international conferences regarding technology and law. Alongwith invitations to speak, he has organised several global conferences in Canada,

Australia and China and has been an advisor on other symposia overseas. Professor 

Perry has published widely in both law and technology journals and has supervised

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many postdoctoral, graduate and undergraduate students, who have gone on to work

at law firms, industry, non-governmental organisations or taken positions in

universities.

Nicolas Suzor   researches the regulation of networked society. He is a Senior Research Fellow in the Law School at Queensland University of Technology in

Brisbane, Australia, and a Chief Investigator of QUT’s Digital Media Research

Centre, where he leads a programme of research on the regulation and governance

of the Internet and social media. His research examines the governance of social

networks, the peer economy, digital copyright and knowledge commons. Nic is also

the Legal Lead of the Creative Commons Australia project.

Sunita Tripathy   is Assistant Professor at the Jindal Global Law School as well asAssistant Director of Centre for Intellectual Property and Technology Law at the

O.P. Jindal Global University, India. She earned her LLM in Intellectual PropertyLaw as a NALSAR-Western Scholar while studying at the Faculty of Law, Uni-

versity of Western Ontario, London, Canada, and NALSAR University of Law,

Hyderabad, India, in 2010–2011; she has a degree in Bachelor of Socio-Legal

Sciences and Law (BSL, LLB) from the Symbiosis Law School, Pune, India.

Tripathy enjoys advanced scholarship and research about law and its role in society

with special focus on its nexus with technology, intellectual property and public

policy. She has published on issues interfacing intellectual property law and

competition policy, led seminars and lecture series on traditional and alternate

approaches to intellectual property protection and management and has spoken inseveral intellectual property conferences and forums in India and overseas.

Margaret Ann Wilkinson   trained as both a lawyer and a librarian, practised lawbefore joining Western University and remains a member of the Law Society of 

Upper Canada. She has been awarded the Ontario Library Associations’s Les

Fowlie Intellectual Freedom Award. Co-author of Canadian Intellectual Property

Law (Toronto: Emond Montgomery; 2013)), she has counseled the International

Federation of Libraries and Institutions [IFLA] at several World Intellectual

Property Association Subcommittee on Copyright and Related Rights [SCCR]

meetings considering the proposed “Treaty for Limitations and Exceptions for 

Libraries and Archives.” Appointed to the Faculty of Law and affiliated with

graduate programmes in both law and health information science, Dr. Wilkinson

teaches, speaks and writes on pharmaceutical and health regulation, professional

ethics, intellectual property and information law. She is currently funded through

Canada’s Social Sciences and Humanities Research Council for research into data

protection, personal data protection and confidential information protection.

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Abbreviations

ACMA Australian Communications and Media Authority

API Active Pharmaceutical Ingredient

ARV Anti-retro Viral

ASEAN Association of Southeast Asian Nations

AWGIPC ASEAN Working Group on Intellectual Property Cooperation

BITs Bilateral Investment Treaties

CJEU Court of Justice of the European Union

CLM Committee on Copyright and other Legal Matters (IFLA)

COBI CobicistatDNA Deoxyribonucleic acid

DNS Domain Name System

EC European Commission

ECHR European Court of Human Rights

ECJ European Court of Justice

EPO European Patent Office

EU European Union

FDA Food and Drug Administration (United States)

FDC Fixed Dose CombinationsFDI Foreign Direct Investment

GATT General Agreement on Tariffs and Trade

GPML Globally Protected Marks List

ICANN Internet Corporation for Assigned Names and Numbers

IFLA International Federation of Library Associations and Institutions

IP Intellectual Property or Internet Protocol

IPR Intellectual Property Rights

ISP Internet Service Provider 

JPO Japan Patent OfficeLDC Least developed countries

LMIC Low-and middle-income countries

MPAA Motion Picture Association of America

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MPP Medicines Patent Pools

NAFTA North American Free Trade Agreement

NDA National Drug Authority (India)

NGO Non-governmental organisation

NTIA National Telecommunications and Information Administration

OECD Organisation for Economic Co-operation and Development

PRB Patent re-examination board

PTIAs Preferential Trade and Investment Agreements

RIAA Recording Industry Association of America

SCCR Standing Committee on Copyright and Related Rights (WIPO)

TDF Tenofovir disoproxil fumarate

TFEU Treaty on the Functioning of the European Union

TLD Top level domains

TLIB Treaty for Libraries and ArchivesTPP Trans-Pacific Partnership

TRIMs Agreement on Trade-Related Investment Measures

TRIPS Trade-Related Aspects of Intellectual Property Rights

TTIP Transatlantic Trade and Investment Partnership

UDHR Universal Declaration of Human Rights

UDRP Uniform Domain Name Dispute Resolution Policy

UNCTD United Nations Convention on Trade and Development

UNESCO United Nations Educational, Scientific and Cultural Organization

URL Uniform Resource Locator USPTO United States Patent and Trademark Office

WCT WIPO Copyright Treaty

WHO World Health Organization

WIPO World Intellectual Property Organization

WPPT WIPO Performances and Phonograms Treaty

WTO World Trade Organization

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The Changing Face of Intellectual Property:Global Forces and Compliance

Mark Perry

Abstract   Over the last three decades there has been constant pressure on devel-

oping nations to conform with the intellectual property ideals of the developed

world, in particular, it can be argued, those of the United States of America. Despite

this, many jurisdictions have managed to maintain at least some part of their own

inherent approach to how intellectual creations, whether invention, expression, or marketing concept, should be dealt with in their state. It can be argued that some

states where governance can be said to be in disarray are, on the other hand, readily

adopting protectionist international norms to validate their statehood.

It should also be noted that even in countries that are seen as having a very solid

view of how intellectual property rights, and the enforcement of those rights, should

be structured, there are still areas of uncertainty as how to implement their laws in

the face of changing technologies and changing global relationships.

1 Introduction

The last 150 years has seen accelerated activity at key times for what is called

global harmonisation of intellectual property rights by some, or the imposition of 

colonialist/imperialist ideals for the propertisation of the expression of human

intellect on developing nations. The English  Statute of Monopolies 1623 followed

by the Statute of Anne 1710  introduced the foundations of what we know today aspatent and copyright, in the common law world at least. There were many changes

over the centuries, but by the end of the nineteenth century we can see the first

major attempts to provide basic global norms of intellectual property protection

expressed in the Paris Convention for the Protection of Industrial Property (1883)

828 U.N.T.S. 305, with its initial 11 signatories (WIPO n.d.), and the   Berne

Convention for the Protection of Artistic and Literary Works   (1886)

828 U.N.T.S. 221, starting with eight signatories (WIPO   2015a). These

M. Perry (*)

School of Law, University of New England, Armidale, NSW 2350, Australia

e-mail: mark.perry@une.edu.au

© Springer International Publishing Switzerland 2016

M. Perry (ed.),  Global Governance of Intellectual Property in the 21st Century,

DOI 10.1007/978-3-319-31177-7_1

1

mailto:mark.perry@une.edu.aumailto:mark.perry@une.edu.au

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international agreements have had significant impact and amendments over the

years with the former now standing at 176 contracting parties (WIPO  2015b), and

the latter currently 168 parties (WIPO 2015a). In recent decades other international

multilateral agreements have been introduced, such as Agreement on Trade-Related 

 Aspects of Intellectual Property Rights   (1994) 1869 U.N.T.S. 299 (Annex 1C))

(‘TRIPS’) under the World Trade Organisation (‘WTO’), the many other agree-

ments under the auspices of the World Intellectual Property Organisation (‘WIPO’).

Some say that this movement to multinational compliance is driven by the notion of 

natural law (Oddi 1996), although much political, and even court ( Mazer v. Stein

(1954) 347 U.S. 201),1 interpretation has been to treat the issue as a utilitarian

question.

This brief introduction raises the question as to how effective international

multiparty agreements have been in creating a homogenised approach to global

intellectual property governance. The survey below introduces some of the issuesraised by the scholars contributing to this work, albeit through the eyes of this

chapter ’s author.2

2 Harmonisation and Differentiation

A review of the current state of play in terms of international agreements, whether 

under the auspices of WTO or WIPO is available via many fine publications andsources. For example, the introduction given by WTO on that website as to the

importance of intellectual property rights, which is also reflected in the material

provided by WIPO, and the many scholastic articles analysing in-depth the changes

in various agreements and relationships between various agreements, such as the

 Berne Convention 1886  and  WIPO Copyright Treaty 1996 . There is probably less

focus put on the divergence inside states. In other chapters of this book you will find

a range of discussions that are introduced in this chapter that illustrate the continu-

ing diversity, and sometimes increased diversity, amongst the way nations treat

intellectual property.In “Prior Art Defence in the Chinese Patent System” (Chapter 2), Lijuan Liu

discusses an aspect of the two streams of governance in patent disputes that are

embedded in the Chinese system, a bifurcated approach that is to the surprise of 

some no doubt. On the one hand it is the courts that decide on patent infringement

issues, but the Patent Re-examination Board and two specific courts deal with

patent validity. The problem arises in the area of prior art as to whether a patent

1 “The economic philosophy behind the clause empowering Congress to grant patents and copy-

rights is the conviction that encouragement of individual effort by personal gain is the best way toadvance public welfare through the talents of authors and inventors in   ‘Science and useful Arts’.”2 It should be noted that this chapter presents the views of this author, and perspectives presented

may not coincide with those of the other chapters. The reader, no doubt, with have their own

interpretation and views.

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is questionable, in which case an infringement hearing needs to be suspended and

returned to the Board for determination. This type of procedure is not contemplated

in international agreements, as they do not deal with this kind of detailed jurisdic-

tional hearing procedure. In 2014, the total patent filings, both from residents and

abroad, reached 837,817 in China, an increase by a factor of ten over the decade,

and outstripping the United States of America’s 509,521 (WIPO 2014). This trend

is reflected in other IP filings in China, and realising that it is now the leading nation

for filing intellectual property registrations it is possible that the pressure for reform

to an effective system will bring more analysis for more effective governance from

that nation in the future.

India, on the other hand, has placed more emphasis on tailoring its intellectual

property regime to meet the needs of its own peoples directly, albeit within the

confines of TRIPS. This can be seen in a r ange of actions, whether addressing seed

saving, preventing patent “evergreening”,3 or the issues of access to drugs, whichwere not patentable in India prior to TRIPS. In “Bio-Patent Pooling and Policy on

Health Innovation for Access to Medicines and Health Technologies that Treat

HIV/AIDS: A Need for Meeting of [Open] Minds” (Chapter 3), Sunita Tripathy

looks at a novel arrangement for patent pooling drugs, known as Medicine Patent

Pools (MPP). Pre-TRIPS, when India had no patent protection for drug products,

the nation was a global leader in generic drug production. It was also provided for 

modern drugs at extremely low cost to patients. The adoption of TRIPS has changed

the market in India, and as discussed in the chapter, good solutions to making

available anti-viral drugs more widely available such as the MPP can also haveunintended outcomes. India has adopted an approach to patenting, despite the

strictures of TRIPS, that still limits that power of large pharmaceuticals to maxi -

mise their profits, for example see  Novartis v. Union of India  (2013) S.C. 1311.4

The drug patent arena is not the only realm where India is criticised by other nations

for taking a less extreme approach to intellectual property protection, indeed the

nation falls within the United States Trade Representative’s Special 301 list

(Froman   2014) under the category “priority watch list” i.e. a country that has

“serious intellectual property rights deficiencies”. The 2014 Report to Congress

criticises India for its compulsory licensing policy on green technologies, and for trade mark “counterfeiting and copyright piracy” (Froman 2014, 19). Of course, it

is fair to say that most developing nations have issues with enforcement, and worth

noting that the report is heavily influenced by commentary encouraged from

3 “Evergreening” is the term used in the patent environment to describe the attempts by patent

holders, especially in the drug arena, to prolong the patent period of the basic compound by

seeking new patents on altered formulations, dosage types, data retention and other business

techniques (see Gaudry 2011).4 Wherein the Indian Supreme Court upheld the decision on the rejection of a patent application by

Novartis for its beta crystalline form of Imatinib Mesylate (Glivec).The Court observed Novartis

to be indulging a strategy that led to   ‘ever-greening’ of its patents, a practice intended to extend the

term of the patent on the same compound; which is impermissible given the patented invention

ought to expire after the stipulated term of 20 years.

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“interested stakeholders”, typically those involved in the intellectual property

industry that would benefit from greater global compliance with the United States

perspective on rights protection.

The United States of America has its own internal struggles with determining

what falls within the boundaries of intellectual property protection as well. This is

illustrated by Shubha Ghosh in “Patent Exhaustion on Trial in the United States”

(Chapter 4), where he looks to an area that is not legislated in the United States but

rather relies on development in the common law tradition of cases. Exhaustion is a

doctrine that in effect protects the market from   ‘reach-through’   rights after the

patented item is sold, so that the vendor cannot later claim on the purchaser.

However, there is a fine balance between selling a patented item and licensing its

use, and the limitation that the doctrine doesn’t apply to self-replication products

such as patents in sequences in seeds, Monsanto v. Bowman (2011) 657 F.3.d 1341,

1347—or perhaps limited to seed (Chapter 4). The limits on exhaustion doctrinesare also under review in the printer cartridges of Lexmark, which is currently in the

courts in the United States of America and discussed herein (Chapter 4).

Another front for challenge and change in the United States can be seen in

Llewellyn Joseph Gibbon’s “Non-Conventional Trademarks Under United States

Law: An Unbounded New Frontier of Branding” (Chapter 10), where trademark is

evolving to include attributes such as appearance, motion, scent, sound, smell, taste

and touch. In other common law countries, Trade Mark of such attributes of a brand

are often protected under the common law of passing off, classically in   Perry

v. Truefitt  (1842) 49 E.R. 749 where the Master of Rolls, Lord Langdale, expressed:

A man is not to sell his own goods under the pretence that they are the goods of another 

man; he cannot be permitted to practice such a deception, nor to use the means which

contribute to that end. He cannot therefore be allowed to use names, marks, letters, or other 

indicia, by which he may induce purchasers to believe, that the goods which he is selling are

the manufacture of another person.

Some legislation, such as Canadian  Trade-Marks Act   (1985) section 7, bring

passing off into a codified form, but the United States of America has taken a

different tack, for example in free trade agreements that insist on protection of 

scents and sounds (Chapter 10, footnote 16). The Trans Pacific Partnership (‘TPP’)also adds requirements for sounds and “best efforts” to register scents (see

e.g. Office of the United States Trade Representative 2015).

Even in Europe, where civil law governs the great majority of jurisdictions, there

have been movements in the development of intellectual property that can be

attributed to the interpretation of the law by the courts, in particular by the adoption

of   ‘autonomous concepts’   as discussed by Alison Firth in “Code, Autonomous

Concepts and Procedure: Stepping Stones for European Law?” (Chapter 5). The

introduction of detail and transparency, citing previous case-law and even

distinguishing earlier cases seems to be the adoption of aspects of the commonlaw doctrine of precedent, which will give a new twist to the governance of 

intellectual property rights in the European Union. How these developments,

along with the aim of further harmonisation of European Union intellectual

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property governance, such as the proposed unitary patent system, in part brought

into effect by procedural reformation, will be interesting to watch over the coming

decade.

Staying with the European Union, Thomas Margoni in “The Harmonisation of 

EU Copyright Law: The Originality Standard” (Chapter 6) delves into the origi-

nality requirement in copyright, from the changing common law standard, which

started with only origination from an author, to civil law countries where more

importance is placed on the personal relationship and inputs to the work in question.

The vertical harmonisation of the originality standard of “author ’s own intellectual

creation” in software, photographs and databases, combined with horizontal adop-

tion of the standard in other areas of copyright. Furthermore there has been

feedback into the legislation of member states (Chapter 6). Margoni also discusses

the significant influence of the courts, particularly the ECJ, is having in setting

norms of originality in the world’s largest single market (see also EuropeanCommission 2014).

One area of copyright that seems to get little attention is exposed in detail by

Margaret Ann Wilkinson in “International Copyright: Marrakesh and the Future of 

Users’ Rights Exceptions” (Chapter 7), a treaty aimed at mandating limitations and

exception of users. The Marrakesh Treaty to Facilitate Access to Published Works

 for Persons Who Are Blind, Visually Impaired, or Otherwise Print Disabled  (2013)

(WIPO   2016),5 as Wilkinson points out, provides many interesting aspects of 

intellectual property development on the international scene, including its incorpo-

ration of the TRIPS three-step-test, and also being a treaty focused on providinguser exceptions.

Copyright has seen dramatic expansion over the last couple of decades, in part to

face the challenges of digital technologies combined with global access to infor-

mation at the push of a button.6 Nicolas Suzor et al. in “Moments of Flux in

Intermediary Liability for Copyright Infringement in Australia” (Chapter 8), exam-

ine the regulatory shift in Australia with respect to addressing internet service

provider ’s liability. Providing systems of governance for copyright in the Internet

age is clearly not trivial, and many nations have struggled to find the balance

between crushing the sharing of socially useful information and allowing a copy-right free zone. Suzor et al. discuss the three major changes that were implemented

in Australia in 2015 and how these illustrate the struggle to find a governance norm

that can satisfy constitutional values and the value attributed to rightsholders, and

address the pressing question of how individual rights can be protected in a

protectionist environment (Chapter 8). Staying within the Internet environment,

Heather Ann Forrest in “The Evolution of Domain Names and their Impacts on

Trademark Rights” (Chapter 9) explores the issue of the changing meaning of 

5 When Wilkinson was writing there were eight ratifications and accessions of the treaty, now

standing at 13.6 Of course, providing that you have access to world networks, the local infrastructure and at least

some equipment.

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domain names over the last 20 plus years. Moving from a simple system of naming

machine   ‘locations’   to one that has challenged the courts as to how such names

reflect on branding (for an early discussion see Perry 1998, 1999). Forrest discusses

the relationship between Trade Mark holders and their uneasy relationship with

domain names, especially where there is the Trade Mark associated with a site

dedicated to complaining about the brand, as with the so-called   ‘x-sucks sites”.

From the intellectual property perspective it is interesting how a non-profit body

such as The Internet Corporation for Assigned Names and Numbers, and an

interjurisdictional non-judicial body, such as those used under the Uniform Dispute

Resolution Process, and rightsholders of Trade Marks, all interact in a way that

could not have been predicted in the foundation days of the Internet. Forrest also

discusses how the new generic Top Level Domains are changing Internet user 

perceptions.

Trade Mark issues are also of concern in the Association of South-East AsianNations (ASEAN), as reviewed by Kanya Hirunwattanapong in “The ASEAN

Single Market: A Perspective on Thailand’s Trade Mark Development”

(Chapter 11). The ASEAN Single Marked was targeted to take effect from

December 2015, although full implementation of a unified trading space will likely

take some time. There is still much divergence amongst ASEAN countries as to

their approach to intellectual property rights, for example only few are members of 

the Madrid Protocol (Chapter 11). Following the experiences that European coun-

tries have had, it is not that surprising that forming a trading group is easy to say,

hard to achieve politically, and extremely difficult in practice.It is clear that intellectual property rights have inroads into much policy and

international agreements outside those treaties that directly deal with them. One

area of importance is the number of agreements, multilateral and bilateral, dealing

with foreign direct investment. Ramesh Karky, in “Intellectual Property Rights and

Foreign Direct Investment Agreements” (Chapter 12), takes a close look at the

relationship between investment and intellectual property. Like TRIPS, the Agree-

ment on Trade-Related Investment Measures (1999) is something of a compromise

between the dichotomy posed by the developing and developed nations. However,

most of the progress with investment has been made by bilateral arrangements, andsometimes these include specific terms relating to intellectual property, such as the

 Agreement between Australia and China on the Reciprocal Encouragement and 

 Protection of Investments  (1988) (Chapter 12). As Karky notes, today often it is

intellectual property based investment that is fuelling development, so the relation-

ship between these two areas should not be overlooked.

A relatively new area of intellectual property analysis comes in the form of 

patentomics,7 and this comes under scrutiny (and development) by Kylie Lingard

7 Following the recent history of development of the   ‘omics age’,   ‘patentomics’ can be considered

to be the systematic study of the structure, function and evolution of a select body of patents. The

tools are now developing that allow this to be done in a high throughput and readily

accessible way.

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and Mark Perry in “Innovation Cartography and Patentomics: Past, Present and

Future” (Chapter 13). The patented databases that are now available online provide

researchers, innovators, businesses and governments access to a wealth of infor-

mation as to the type of patented innovation happening at any given time, and who

is working in which field. As test case for patentomic exploration the authors have

looked at the crop innovation landscape as expressed through patents. Patent

cartography, patentomics, is bringing a chest of tools available to anyone with the

skills and time to make discoveries about discoveries, for example, by explor-

ing which companies are focusing on which sector, or where in a particular field is

innovation receiving a large number of patents.8

3 The Future

Despite pressures for conformity, sovereign states still try to work as independent

actors, where there is room for them to negotiate or legislate variations, and attempt

to protect their own interests. The changes in intellectual property that are occurring

around the globe can provide a practical touchstone to show the condition of 

development of a state. How the topic has become internationalised, a part of 

trade, an icon of prosperity and culture development, shows international

approaches to a topic that firstly has been fundamental to development and nation-

hood, and secondly one that has felt the increasing pressure to treat creations of human intellect, or some may argue animals and computers too, as a property right

much the same as other property rights.

The issues discussed in this work are not the only areas where intellectual

property is being recast due to the pressures of technology, the courts, business

and policy directions. There are multitudes of instances where the tension is

apparent. In India for example,  Super Cassetts Industries Ltd. v Music Broadcast 

 Pty. Ltd.   (2012) Civil Appeal Nos. 4196-4197 seeks to clarify the compulsory

licensing provisions of the Indian  Copyright Act (1957), section 31. Even in the

United States of America, which has for decades been feted for promoting patentsfor human endeavour, such flux is evident. As noted in the Committee Reports

accompanying the 1952 Act telling us that the United States Congress intended to

“include anything under the sun that is made by man” in the subject matter for 

patent (S.Rep. No. 1979, 82d Cong., 2d Sess., 5 (1952); H.R.Rep. No. 1979, 82d

Cong., 2d Sess., 6 (1952)), the United States has generally been a jurisdiction that

makes it easy to get a patent. However, even this is subject to interpretation and

8 Some equate patents with innovation, however in this author ’s view this is not the case. Patents

represent invention that is patented. A lot of innovation is not patented.

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refinement as seen   in   Association for Molecular Pathology v. Myriad Genetics

(2013) 569 U.S. ___,9 where the court rejected the BRCA patents. Australia has also

recently altered its position on gene patents in its ver sion of the same case,  D’  Arcy

v. Myriad Genetics & Anor  [2014] F.C.A.F.C 115.10 In the last two years we have

seen a number of instances where the utilitarian perspective is promoted, for 

example in the negotiations for international agreement attempting to give more

protection to drug companies (Trans Pacific Partnership). On the other hand, some

courts, such as the Supreme Court of Canada in  CCH , have started to recognise the

rights of users (of intellectual property) (CCH Canadian Ltd. v. Law Society of 

Upper Canada   (2004) S.C.C. 13). Copyright reforms in Australia to block web

sites, China’s political determination to dominate the innovation sector through

patent, the global struggles at the political level to find leverage through intellectual

property rights. It is fair to say that the great protection for intellectual property

rights agenda is strongly promoted by the United States, which focuses on gettingother countries to come to their own perspective. Effects are global, for example the

governance of intellectual property in Arab countries has seen “an unprecedented

wave of legislative reforms aimed at meeting their obligations under [TRIPS and

free trade agreements]” (Elmahjub 2016).

Even Switzerland, for example, cannot escape the wrath of the United States

Special 301 Trade commentaries:

The United States continues to have serious concerns regarding Switzerland’s system of 

online copyright protection and enforcement. The United States strongly encourages

Switzerland to demonstrate its commitment to copyright protection and to combatingonline piracy by taking steps to ensure that rights holders can protect their rights (Froman

2014, 21).

In another dimension of the intellectual property spectrum there has been

increased   ‘normalisation’  of the use of an open philosophy for sharing works, at

least based in part on one of the jurisprudential underpinnings of intellectual

property that in order to progress the Arts and Sciences there must be, minimally,

access to the materials, and the more open the access the greater societal benefit.

The Creative Commons licences are a good example of this, as is the Open Science

movement and efforts by independent groups such as Cambia. These individualinstances can be seen as pointing away from an international norm of a fixed,

harmonised, and possibly the more protectionist extreme view of rights in the

underpinnings of intellectual property. Indeed, there is a flux in the force.

9 Justice Thomas: “We hold that a naturally occurring DNA segment is a product of nature and not

patent eligible merely because it has been isolated, but that cDNA is patent eligible because it isnot naturally occurring”.10 The Australian High Court (the highest court in the judicial system) allowed the appeal from the

Federal Court of Appeal. Interestingly the latter court had openly criticised the United States

Supreme Court judgement  Association for Molecular Pathology v. Myriad Genetics.

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Accessed 20 Jan 2016.

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visually impaired or otherwise print disabled.   http://www.wipo.int/treaties/en/ip/marrakesh/ .

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en/ip/paris/ . Accessed 20 Jan 2016.

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Prior Art Defence in the Chinese PatentSystem

Lijuan Liu

Abstract   The prior art defence in China is quite different from that of most

countries. It is complicated and cannot be easily understood, requiring researchers

to explore deeply into the legal system and specific circumstances of China. There

is currently a duel stream system in place that is addressed in this chapter. The prior 

art defence is regarded by the Supreme People’s Court as a tool to solve the problemof prolonged patent infringement litigation, and has acquired a different purpose

from that of the defence in other countries. There are many disputes in the patent

arena occurring both before and after the establishment of the prior art defence in

China. With the evolution of China’s general legal system and the intellectual

property regime, it is likely that the prior art defence will develop into a more

globally standard form, although with particular Chinese characteristics.

1 A Case and Disputes Related

1.1 A Case

A relatively recent case heard by the Supreme People’s Court of the Peoples

Republic of China in 2010 is of key importance ( Bridgestone Corporation v

 Zhejiang Hang Ting Dun Bull Rubber and Beijing Bang Li Xin Tire  (2010) Civil

Ruling No. 189).1 The complaint was from a tyre tread design patent owner,

Bridgestone Corporation, a famous Japanese tyre-producing company. The alleged

infringer was a small rubber-related products producer,2 which was manufacturing

L. Liu (*)

Faculty of Law, Beijing Foreign Studies University, Beijing, China

e-mail: liulijuanbfsu@163.com

1 hh株式会社普利司通与浙江杭廷顿公牛橡胶有限公司、北京邦立信轮胎有限公司侵犯专利权案ii[Bridgestone Corporation v. Zhejiang Hengtingdun Rubber Ltd [Design Patent Infringe-ment Case], 最高人民法院 [The Supreme People’s Court] (2010) 民提字 第189号 [Min Ti Zi

No. 189].2

So small that the company does not even seem to have a website.

© Springer International Publishing Switzerland 2016

M. Perry (ed.),  Global Governance of Intellectual Property in the 21st Century,

DOI 10.1007/978-3-319-31177-7_2

11

mailto:liulijuanbfsu@163.commailto:liulijuanbfsu@163.com

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a type of tyre that had a tread design similar to that of the complainant. The

defendant raised the prior art defence when it was sued for design patent infringe-

ment. Given that there were severely different opinions among the courts on how to

decide the prior art defence, the Supreme People’s Court issued writ of certiorari to

hear the tyre case by itself and made a decision that established the rule on prior art

that corrected the lower courts’ opinions.

The main difference between the Supreme People’s Court and the lower courts

in this case was whether the comparison should be made between the alleged design

and the prior design, or between the alleged design, the prior design and the

patented design; in other words, whether the patented design should be included

when making prior art defence comparison. The two lower courts of the first

instance and the appeal held that the comparison should be made just between the

alleged design and the prior design and there is no need to involve the patented

design, as this was the meaning given in the words of Chinese Patent Law article 62.The Supreme Court overruled that decision and held that the comparison should be

made with the patented design partially involved.

1.2 Disputes on Prior Art Defence

There have been many different opinions in China on how the prior art defence should

be interpreted and operate. Those opinions are still influencing the ways in which thedefence is implemented. The arguments mainly concern these issues: The first, is it

literal infringement or equivalent infringement that prior art defence should be applied

to? The second, is the prior art defence to be established for the allegedly infringing

product in terms of whether it is identical or similar? The key issue is whether or not the

patent itself should be involved in the prior art defence comparison.

The starting point is that the defence may apply only when an equivalent

infringement is established, as it has been regarded as a way to prevent patent

owners from broadening the scope of the patent to cover prior art through this

equivalent infringement doctrine. With this kind of the prior art defence there is noneed to check the validity of patents, and it would not authorise courts to examine

the validity of the patents themselves and therefore would not harm the current

patent authorities (He   2008). This is the reason why this line of reasoning was

supported by Patent Re-examination Board (hereafter referred to as   ‘Board’) and

Beijing Higher People’s Court, the latter being a very important court in patent

cases since it is the only appeal court for all cases that rest on the validity of patents.

In its 2001 version of “Guidelines for Determination of Patent Infringement”,3 the

3 The Guidelines by the Beijing High People’s Court are not considered as Interpretations, part of 

statutes only coming from the Supreme People’s Court. The Guidelines are rather a generalised

publication of certain regional court’s official opinions aimed at guiding the judges of that specific

court on specific issues and informing the public of the attitude of the court as a whole. Guidelines

have quasi-binding effect for the judges of that specific court and are not binding for other courts,

although they do have a persuasive effect.

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Beijing Higher People’s Court provided in article 100 that when the allegedly

infringing product is regarded as an equivalent product to that covered by the

patent, the prior art defence can be utilised if the alleged infringer can prove that

the product fell within a prior art under this opinion. However, under this interpre-

tation, prior art defence would have a rather limited role in the patent system, which

is the exact reason why it has been abandoned by the Supreme People’s Court.

This conservative thought of never breaking the current distribution of author-

ities, however, still holds sway. This was the reason for the other opinion of the

Beijing First Intermediate People’s Court, which was the court of first instance in

the Bridgestone. According to this Court’s opinion, the defence could apply in both

literal and equivalent infringements, but the comparison should be made only

between the alleged art and the prior art, in other words, the patented art should

not be included as a factor for consideration.

Another important view was proposed by the plaintiff, the patent owner, in Bridgestone  and supported by some other courts. This line of reasoning holds that

the prior art defence is established only when the prior art is identical to the alleged

art. However, when the prior art is not identical but similar to the alleged art, the

court should not decide directly that the prior art defence has been established.

What the court should do in this situation is to follow the current distribution of 

power, that is to say, to suspend the infringement case and wait for the decision of 

the Board on the validity of the patents in question. The reason for this narrow

application of the defence is based on the belief that the courts should not be

allowed to examine the validity of the patents during the patent infringementcases, since it is inevitable to involve the patented art into the comparison in the

“similar” situation while there is no need to do this in the “identical” situation.

Other courts, in contrast, insist that it is necessary to compare the prior art with

the patented art and thus it is therefore inevitable that the novelty or inventiveness

of the patented art be examined, as this is the real basis for the prior art defence.

From this perspective, the prior art defence should definitely be aimed at breaking

the current distribution of authorities by letting courts examine novelty and even

inventiveness during patent infringement cases (First Intermediate People’s Court

of Beijing 2011, 22). They insist that this is the norm in all other countries.

2 Introduction of China Prior Art Defence

Chinese patent law protects three kinds of subject matter, namely inventions, utility

models and designs. The first two are technologies and the third is basically a

question of aesthetic appearance of industrial products, similar to Industrial Design

laws in other countries, such as Australia. The prior art defence is therefore dividedinto two categories: the prior technology defence and the prior design defence. The

two defences are not always confronting same issues, although the term “prior art

defence” is used to address the basic issues in China.

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The prior art defence was not available in previous versions of China Patent Law

(1984, 1992, and 2000), and it was not until the promulgation of the revision in

2008 that it was introduced. The defence was added in article 62:

In a patent infringement dispute, if the alleged infringer can prove that the technology or design exploited is actually practicing a prior art, the exploitation shall not constitute a

patent infringement.

According to article 62, if the defendant under a patent infringement challenge

can find a prior art that is the same or similar to the alleged infringing art, the court

shall not support the patent infringement complaint because the accused would be

considered just in using a prior art, which should be already freely available and

thus not excluded from the public domain by the patentee.

If a prior art is found, the alleged infringer may also challenge the validity of the

patent in China at the same time, which was the only way to fight against a patenteebefore the 2008 Revision. Both mechanisms are available after 2008, but they are

dealt with through different channels. The prior art defence is raised by the alleged

infringer to deny the infringement complaint during the patent infringement litiga-

tion. The defence is addressed by the same judges in the same court, and the

conclusion addresses whether the accused could avoid the infringement claim

without considering the validity of the patent. The alleged infringer may, however,

choose not to propose the prior art defence and instead challenge the validity of the

patent directly. However, once they challenge the validity of the patent, the court

has to suspend the infringement case to wait for the decision of patent validity,

which is determined by the Board (as this is currently the only authority enjoying

the power to examine the validity of patents). The court is not allowed to examine

the validity of a patent during an infringement case. Furthermore, the validity of a

patent may also be challenged by almost anyone, other than the alleged infringer,

and may be based on all the patentability conditions, which extends the basis of 

potential challenges to a much wider range of issues than prior art.

Article 62 is too basic to provide any specific information, but a subsequent

interpretation on patent infringement by the Supreme People’s Court in 2009 pro-

vides some further detail in article 14:

Where all the alleged technical features fall within the scope of patent protection and are

identical to or without material difference from one of the corresponding technical features

in an existing technical proposal, the trialling people’s court shall conclude that the

technologies applied by the alleged infringer are the existing technologies under article

62 of the Patent Law (Lehman 2009).

Where the alleged infringing design is identical to or without material difference

from an existing design, the People’s Court at trial shall conclude that the design

used by the alleged infringer is the existing design under Article 62 of the Patent

Law. The prior technology part of this Interpretation has been made clearer through

a subsequent important case. In 2012, The Supreme People’s Court published

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 Zetian Machinery v. Yancheng Greater Machinery  (2012) Civil Ruling No. 184 in

which the Court clarified the application of the prior technology defence (see

Xiaodu 2014). The Court held that the comparison in the prior technology defence

is supposed to be made with reference to the claims of the patent. It should be

between the technical features of the alleged infringing technology falling within

the extent of protection of the patent and the prior art, instead of between whole

technical features of the alleged infringing product and the prior art, since the latter 

would result in ridiculous and non-logical conclusions. The Court stressed that it

does not mean the validity of the patent would be examined in the Court. The patent

is regarded as a  reference   to specify which technical features are to be compared

with the prior art, given the alleged infringing products are usually specific products

or processes which comprise much more technical features than the prior art.

The Interpretation is less informative with regard to prior design defence. It

basically just says that if the alleged infringing design is identical or having nosubstantial disparities from the prior design, the defence would be established.

However, this design did not concern technology, and thus not involve comparing

any technologies. So the   Zetian   doctrine cannot be applied in the prior design

defence. The tyre case is even more complicated and will be discussed specifically

later.

3 Prior Art Defence in Other Countries

Prior art defence seems quite different in other countries.

 3.1 Prior Art Defence in US

Prior art defence has been clarified clearly through two cases delivered by the

United Stated Court of Appeals for the Federal Circuit:   Wilson Sporting Goodsv. David Geoffrey & Associates   (1990) 904 F.2d 677 and   Tate Access Floors

v. Interface Architectural Resources   (2002) 279 F.3d 1357. Generally speaking,

prior art can be used to dispute equivalent infringement instead of literal

infringement.

According to the Court in  Wilson Sporting Goods v. David Geoffrey & Associ-

ates, the prior art defence can be used to dispute equivalent infringement:

4 hh盐城则天机械有限责任公司与盐城市格瑞特机械有限公司侵犯实用新型专利权纠纷案ii[Zetian Machinery Co., Ltd. v. Yancheng Gereite Machinery Co., Ltd [Utility Model Patent

Infringement Case], 最高人民法院 [The Supreme People’s Court], [2012] 民申字 第18号 [Min

Shen Zi No. 18].

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There can be no infringement if the asserted scope of equivalency of what is literally

claimed would encompass the prior art (Wilson Sporting Goods v. David Geoffrey &

 Associates (1990)).

Tate addressed this point more logically:

The doctrine of equivalents expands the reach of claims beyond their literal language. That

this expansion is guided and constrained by the prior art is no surprise, for the doctrine of 

equivalents is an equitable doctrine and it would not be equitable to allow a patentee to

claim a scope of equivalents encompassing material that had been previously disclosed by

someone else (Tate Access Floors v. Interface Architectural Resources  (2002)).

The prior art defence is, in short, aimed at constraining the extent of patents

broadened through the doctrine of equivalents instead of challenging the validity of 

patents.

In   Tate, the Court made it clear that the prior art defence cannot be used to

overturn a literal infringement complaint:

The presence of the prior art and its relationship to the patent claim language matters for 

invalidity (Tate Access Floors v. Interface Architectural Resources  (2002)).

And:

Where such claim language clearly reads on prior art, the patent is invalid (Tate Access

 Floors v. Interface Architectural Resources (2002)).

If the prior art were allowed to be a defence against literal infringement, the

accused infringers would be able to do the following:

Flout the requirement of proving invalidity by clear and convincing evidence by asserting a

‘practicing prior art’ defence to literal infringement under the less stringent preponderance

of the evidence standard (Tate Access Floors v. Interface Architectural Resources  (2002)).

They would be able to do this because:

Law requires patent challengers to prove invalidity by clear and convincing evidence.

Where an accused infringer is clearly practicing only that which was in the prior art, and

nothing more, and the patentee’s proffered construction reads on the accused device,

meeting this burden of proof should not prove difficult (Tate Access Floors v. Interface

 Architectural Resources (2002)).

Both patent validity and prior art defence are heard in the same litigation by the

same court in the United States.

In China, however, the prior art defence applies not just in equivalent infringe-

ment but also in literal infringement cases and the comparison is made between the

alleged infringing art and the prior art, which is not permitted in the United States.

Then under the literal infringement case, the accused may raise prior art defence as

well as challenge the validity of the patent in China. But in the latter situation, the

courts are supposed to suspend the infringement case to let the challenger go to

Board to doubt the validity of the patent, since the courts hearing patent infringe-ment cases do  not  enjoy the power to examine the validity of patent. This ability

belongs exclusively to Board.

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 3.2 Prior Art Defence in Japan 5

In Japan, the prior art defence is also used by the accused to dispute patent

infringement claims. That the accused art is the same as a prior art would definitelyresult in the conclusion that the accused art is not infringing the patent for it

obviously just used an art existing earlier than the patent. The comparison made

here is similar to that in China, that is, between the alleged infringing art and a prior 

art, and is different from that in the United States. The reason is that Japan has a

similar dichotomy of authorities between patent infringement and validity.

The prior art defence was weakened in 2004 when the defence of definite

invalidation of patent was established into the new version of   Japan Patent Act ,

article 104.3. The new legislation provides for the following:

Where, in litigation concerning the infringement of a patent right, the said patent isrecognised as one that should be invalidated by a trial, the patent may not be exercised

against the adverse party ( Japanese Patent Act  (2004) article 104.3).

Given the accused party challenges the validity of the plaintiff ’s patent, the trial

court may examine the validity of the patent and refuse to support the patentee to

exercise their patent when the patent is found by the court as one that   ‘should be’

invalidated. However, it is different from the system in the United States as the trial

court is still not allowed to invalidate the patent directly, but rather authorise the

examination of the patent and decide whether to support the plaintiff ’s infringement

claims based on a presumed future conclusion of the Japanese Patent Office(‘JPO’). When the patent   ‘should be’ invalidated for not meeting some substantial

patentability conditions, the court may decide that the defence has been established

and refuse to support the plaintiff instead of announcing the invalidity of the patent.

This mechanism of defence applies only in obvious situations, that is, where the

patent would obviously be invalidated by the JPO. In China, this is seen as a

“defence of definite invalidation of patent”.

The defence of definite invalidation of patent is breaking the serious dichotomy

of patent-related powers and can be seen as great progress. Some scholars believe

that the invalidity defence would completely take the place of the prior art defence,while more scholars insist that the two defences are applied in different situations.

The invalidation defence applies under the whole patentability situation, even

involving prior art, whereas the prior art defence can be established when the

alleged infringing product is the same as a prior art and the invalidation defence

can be established when the patented art is same or similar to a prior art.

It can be concluded that China’s current prior art defence is more like that of 

Japan than that of the United States. The reason is that the two countries have

similar division of power dichotomy in the patent system, as well as having similar 

general legal systems, being Civil Law countries. However, the prior art defence is

5 Information on Japanese relevant systems comes mostly from Yang (2012) and Tumura (2010),

257–266.

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addressing much simpler situations in Japan after the invalidation defence has been

formally established, while the prior art defence is still confronting an extremely

complicated environment in China where the invalidation defence doesn’t exist in

the same way. In China, the courts depend heavily on prior art defence to solve

serious problems.

4 Complicated Situation in China

 4.1 The Real Issues: Behind the Veneer 

All disputes, no matter how they are presented, are rooted in China’s specific

mechanism of power and even in Chinese culture: the powerful administrative

branch.

There has been a steady dichotomomy between patent-related authorities in

patent infringement cases (civil cases) and patent validity examining cases (admin-

istrative cases). Administrative decisions may also be reviewed judicially but only

through special administrative litigation in which the administrative authority is

always the defence. The Board and the two Beijing courts (that is, the Beijing First

Intermediate People’s Court and the Beijing High People’s Court) are in the same

 jurisdiction. They form the only route to examine and decide the validity of patents,

and this is basically an issue under administrative power. The intellectual propertyJudges in more than 70 local intermediate courts enjoy the power to hear patent

infringement cases, but they are not permitted to examine the validity of patents

(administrative cases) during patent infringement cases (civil cases).

This system should work well, at least theoretically, since the Board is made up

of professionals from various technological areas and is believed to be more

capable in examining the validity of patents that involve essentially technological

issues. Decisions on the validity of patents would be more consistent when coming

from the single channel, that is, the Board and the two Beijing courts, rather than

from more than 70 regional courts. This system does have these above advantagesexcept for one problem: the overly complex and protracted processes. In most

patent infringement cases, the defendant would challenge the validity of the patent.

Once that happens, the case has to be suspended to wait for the decision of Board on

the validity of the patent. If one of the parties does not accept Board’s decision, the

only relief  provided is to raise an administrative litigation to challenge Board’s

decisions.6 So, the complete procedures of a typical patent infringement case in

6 Administrative litigations are different kind of cases from civil cases since the defendants are

always administrative authorities who make administrative orders about something, in this case,

the validity of patents. What is discussed here is not even a normal kind of administrative litigation

because the only defendant is the Board located in the jurisdiction of Beijing First Intermediate

People’s Court who therefore becomes the only court of first instance to review the Board’s

decision and Beijing High People’s Court who become the only appeal court.

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China would be, first, civil infringement case of first instance (heard by local

intermediate courts), which is to be suspended once the validity of the patent is

challenged by the defendant, then the examining procedure of the validity of the

patent by Board, and then the administrative litigation by Beijing First Intermediate

Court of the first instance on the decision of Board concerning the validity of the

patent, and then the appeal administrative litigation, which is normally the final

decision on the validity of the patent unless the case is accepted by the Supreme

People’s Court, which rarely happens. Following this, the case would return back to

the original patent infringement litigation to decide whether the infringement exists.

Any party dissatisfied with the decision on the infringement could still appeal. The

decision of the appeal court on the patent infringement is normally the end of this

whole litigation unless the civil infringement case is accepted by the Supreme

People’s Court to review. Quite a lot of patent infringement cases will go through

all the above procedures as long as the party can afford it. It is not unusual in Chinafor a company to be struggling in those endless procedures.

The real issue underneath all the different views on prior art defence, we might

find, is a question of power distribution: Should we keep the Board and the two

relevant Beijing courts as the only channel to check the validity of patents? Or 

should we allow the 70 or more regional courts to step in through prior art defence

to check the validity of patents? People have different thoughts on that. Some

believe that it is a worldwide and unavoidable trend to let courts check the validity

of patents during civil infringement cases (Huaiwen 2008). Others insist that it is

more realistic in China to limit the power of checking the validity of patents to theonly channel given the special situation.

The real purpose and value of the prior art defence in China, at least for the

Supreme People’s Court, on behalf of the many local courts hearing patent infringe-

ment cases, is to let the judge decide directly whether the patent has been infringed

without suspending the case and thus shortening the processes of patent infringe-

ment cases and freeing the parties from litigation sooner.

 4.2 The Supreme People’ s Court ’ s Way to Apply Prior Art 

 Defence

The Supreme People’s Court expressed its attitude of the way to apply the defence

in the Zetian  and Bridgestone. The tyre case will be analysed here since it reflects

the complicated situation of a typical defence.

First, the Court believed that the defence should not be limited to the   ‘identical’

situation and should also be applicable to the similarity situation, otherwise the

defence would have a rather limited role since the alleged art is rarely identical to

the prior art. When an alleged design is similar to a prior design, however, the result

would be ridiculous if comparing the alleged design with the prior design without

involving the patented design. We could see this ridiculous situation in

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 Bridgestone. In this case, comparing only the alleged design with the prior design,

shows a good degree of similarity. At the same time the patented art was found to

have some important differences from the prior design, which means that patent

validity would probably be sustained by the Board. The allegedly infringing art was

actually using the features which the patented art had but the prior art didn’t have,

which means a real infringement exists. However, the prior art defence was still

established to relieve the infringer according to the courts of first instance and the

appeal, which believed that the prior art could be established as long as the alleged

design is found similar to the prior design and no need to involve the patent design.

The reason for this dilemma is the conscious or unconscious denying, or 

ignorance, of the fact by our judges and analysts that China’s current prior art

defence has the same roots in novelty or even inventiveness of patents, an under-

standing that is not lacking in other countries such as the United States. Whether we

admit it or not, the logic of China’s prior art defence is still that the patent shouldnot be granted in the first place if there is a prior art, and of course then there is no

possibility of infringement. When the allegedly infringing art is identical to the

prior art, the result of the prior art defence after comparing the prior art with the

alleged one is in consistent with the result of validity of the patent: if the allegedly

infringing art is identical or similar to the patented art, the prior art will be identical

or similar to the patented art too, which definitely means the patent should not have

been granted for the lack of novelty or inventiveness, and of course then there is no

infring