Damage of patent infringement litigation: The damage claim of 20 million was fully supported because the infringer refused to provide account books ——(2021) Supreme Law Zhimin Final No. 148, Supreme People's Court

[ 2021-11-22 ]

Edited by Tim Jia and Ming Liu, Foundin IP



On November 3, the Intellectual Property Division of the Supreme People's Court issued a judgment on a dispute over infringement of patent rights, and fully supported the patentee’s claim of CNY 20 million for damages and CNY 100,000 for reasonable expenses.


Synthes GmbH is the owner of the invention patent ZL03827088.9, titled "A device for treating femoral fractures". Dabo Medical Technology Co., Ltd. (hereinafter referred to as Dabo Company) is a Chinese listed company specializing in medical devices. Hunan Derong Medical and Health Industry Co., Ltd. and Hunan Derong Medical Device Logistics Distribution Service Co., Ltd. (collectively referred to as two Derong Companys) are the resellers of Dabo Company. Synthes GmbH claimed the products related to intramedullary nails manufactured, sold and offered to be sold by Dabo Company fell into the scope of protection of the patent. The two Derong-Companys sold the above-mentioned infringing products, and were sued to the court.


The court of first instance decided that Dabo Company and two Derong- Companys should stop the infringement, and Dabo Company should compensate Synthes GmbH for losses and reasonable expenses totaling CNY 1 million based on the statutory compensation.


Neither Dabo Company nor Synthes GmbH was satisfied with the above judgment and appealed to the Supreme People's Court.


In this case, Synthes GmbH claimed to use infringement profits to determine the amount of damage, CNY 20 million, provided three calculation methods, and submitted evidences including the corporate operating profit rate disclosed in the Dabo company’s prospectus and the number of alleged infringing products sold on the website. After the court required Dabo Company to provide sales data of infringing products, Dabo Company only provided printed copies of sales data in 2014 made by itself for the court’s reference on the grounds that the sales receipts could not be found.


The Supreme People's Court believed that the patent involved was an invention patent in the field of medical devices, which is very attractive in the patented product market. The alleged infringing products belong to the Type III medical devices implanted in the human body. In order to ensure the health and life safety of patients, our country requires the production and sales of the Type III medical devices to be traceable. As a listed company that manufactures such medical devices, Dabo Company should have a good grasp of the production and sales of infringing products, and could accurately calculate its infringement profits through self-evidence.


In the case that the patentee has tried his best to provide evidence, and the evidence and the calculation method can prove that the amount of the damage is reasonable, while the infringer does not agree with the claimed damage, and refuses to provide the evidence he has, the people’s court can presume that the amount claimed by the patentee is valid.  Therefore, the Supreme People's Court fully supported 20 million damage claimed by Synthes GmbH.


The judgment in this case demonstrates the court's determination to increase intellectual property protection in key areas related to people's life, and also reflects the judicial attitude of Chinese courts to equally protect domestic and foreign rights holders.


Source: the Intellectual Property Division of the Supreme People's Court