Written by Elliot ZHOU and Xiaoling XIA

 

When multiple courts have jurisdiction over a plaintiff's claims, the plaintiff may forum shop, or choose the court that will treat his or her claims more favorably. According to the Chinese Patent Law and relevant judicial interpretations, when a patent infringement arises, the courts that have jurisdiction over such a case includes:

-       (1) the Intermediate People’s Court (including the specialized IP Court) where the infringement takes place; or

-       (2) the Intermediate People’s Court (including the specialized IP Court) where the defendant’s domicile is located.

 

Here, the “patent infringement” is defined as those manufacture, sell, offer for sale, use or import the patented product(s), and include the place where infringing activities take place and the place where infringing result takes place.

 

However, if the patent infringement is found online only (for example, found on the e-commerce platform only) and if it is hard to prove where the infringement actually takes place, the safest approach is to choose a court at the defendant’s domicile to file the patent litigation (namely, the option (2) above).  

 

Specifically, for online patent infringement, we have seen some plaintiffs mistakenly choose a court at the delivery address for patent litigation. Their logic was that the online shopping allows buyers to select the address for delivery, and therefore they choose their home address as the purchasing address, shipping address or the billing address, and they thought that this would naturally make their home address become a place where infringing result takes place. This logic was proven to be wrong according to the Supreme People’s Court judgement in 2017 (Zui Gao Fa Min Xia Zhong No. 107), and after that judgement took effective, the delivery address of any online shopping is no longer deemed to have an appropriate jurisdiction over patent or trademark litigation.

 

Generally, in comparison to the intermediate people’s courts, the four specialized IP courts (i.e., the ones based in Beijing, Shanghai, Guangzhou, and possibly the one based in Hainan as well) would have less local protectionism and tend to award higher damages in a patent infringement litigation. Thus, if a non-Chinese entity is ready to initiate a patent litigation in China, a forum shopping to one of the specialized IP courts based in Beijing, Shanghai or Guangzhou is highly recommended.

 

A common approach for such a forum shopping is to attend exhibitions based in Shanghai, Guangzhou or Beijing, and conduct a notarized investigation or notarized purchasing at the exhibition to secure the evidence. As many large exhibitions are held in cities like Shanghai, Guangzhou or Beijing, it would be easier to secure the evidence in the exhibition and establish a court’s jurisdiction concurrently. According to a report by Shanghai IP court, in almost 72% of the IP infringement cases, the plaintiffs use exhibitions held in Shanghai as a way to establish jurisdiction in Shanghai.

 

Additionally, a forum shopping to intermediate people’s courts located at Hangzhou, Suzhou and Shenzhen would also be a good second option, because these cities are relatively economically developed and have a good number of experienced judges to hear patent infringement trials for years.

 

If you have any questions about this topic or patent-related litigation or prosecution, please feel free to contact us at patent@foundin.cn.