News from China on FRAND, Preliminary Injunctions, Damages

1.  The China-IPR Blog has published a post on the ABA Antitrust and International Sections' Comments on the Supreme People's Court's draft reforms relating to the law on preliminary injunctions.  The ABA sections express concern that the extension of the new rules to competition law matters could serve the interests of incumbents over new entrants.  The blog post argues, however, that at least in IP matters China needs to make preliminary injunctions more readily available, and asserts that preliminary injunctions were granted in only 1/8,000 IP matters in 2013.

2.   Rajiv Kr. Choudhry has a post on Spicy IP titled China Rules on Adjusted Royalty Base for SEP Licensing.  The article discusses (in much greater detail) the Qualcomm matter that I blogged about here.  The article includes a link to the decision of the National Development and Reform Commission (in Chinese) and a comparison of Chinese and Indian practice relating to, e.g., the selection of the appropriate royalty base.

3.  My student Joseph Patton alerted to me to this online article on a recent amendment to a document titled (in the article's translation) "Provisions on Issues concerning Applicable Laws to the Trial of Patent Controversies."  I believe the document referred to is an amended version of a 2001 document I referred to in my book, following Douglas Clark's translation, as "Several Provisions of the Supreme People’s Court on Issues Relating to Application of Law to Adjudication of Cases of Patent Disputes" or "Patent Trial Guidelines." The online article has a link to the Chinese text, which I plugged into Google Translate to get a better (albeit hardly perfect) sense of the intended changes.  If I understand correctly, though, the amendments to articles 20-22 (relating to damages) appear to conform the Patent Trial Guidelines to certain amendments that were introduced in the Third Revision of China's Patent Act in 2009.  For example, as I note in my book at page 354, article 21 of the 2001 Patent Trial Guidelines permitted courts to award damages multipliers of up to three times the amount of actual royalties, whereas article 65 of the statute states merely that "If it is hard to determine the losses of the patentee or the benefits acquired by the infringer, the amount of compensation may be determined according to the reasonably multiplied amount of the royalties of that patent."  The amended version of the Patent Trial Guidelines appears to conform with article 65 by removing the reference to "three times the amount of actual royalties."  Similarly, article 21 of the 2001 Patent Trial Guidelines authorized courts to award statutory damages of “more than RMB 5000 yuan and less than RMB 300,000 yuan, but not exceeding RMB 500,000 at most.”  As I noted at page 354, however, article 65 of the Patent Act doubled these amounts, and the amended Guidelines now simply refer to article 65 itself.  All of this should be taken with a grain of salt, however, until I succeed in obtaining a better translation of the amended guidelines.

4.  My book (again at page 354) also reports that, according to analysis performed by the online service CIELA China IP Litigation Analysis using data "from judgments published by the major IP courts around China," average damages from 2006 to 2011 in all types of patent cases in China ranged from RMB 64,964, (about U.S.$9,000) in 2007 to RMB 414,770 (about U.S.$60,000) in 2008 (with further breakdowns for invention patents, utility models, and design patents).  For CIELA's more recent and updated statistics, see here (reporting average damages for 2013 of RMB 99,030, though based on only 132 cases, and of RMB 51,635 for 2012 based on 470 cases).  Apparently CIELA continues to update its database with cases from earlier years as well, because some of the numbers I reported in my book are different as well.