Bridgestone v Bull - prior design defence in China

Many of our readers have questions about the enforceability of designs in China.  We are delighted to bring you this report of a recent case on tyres, courtesy of the eminent Mr Chixue Wei of Linda Liu Group in Beijing, which was recently published in their IP Newsletter No 9. 

Bridgestone Corporation v Zhejiang Hang Ting Dun Bull Rubber Co., Ltd. and Beijing Bang Li Xin Tire Co., Ltd.

Basic Information

The patentee
(plaintiff in the first instance, appellant in the second instance, applicant in the retrial procedure): Bridgestone Corporation (hereafter referred to as Bridgestone Company)

The accused infringers

(defendant in the first instance, appellee in the second instance, respondent in the retrial procedure): Hang Ting Dun Bull Rubber Co., Ltd. of Zhejiang Province (hereafter referred to as Bull Company); Beijing Bang Li Xin Tire Co., Ltd.

Competent Courts and Case No.

The first instance: Beijing No. 2 Intermediate People’s Court of P.R.C. (2007) No.2 Intermediate Court Civil First Instance No.391

The second instance: Beijing Higher People’s Court of P.R.C. (2007) Higher Court Civil Final No.1552

The retrial: The Supreme People’s Court (2010) Civil Arraignment No.189

Type of the Case:
Infringement on the Patent for Design

Final Decision:
Bridgestone Company won the litigation

Date of Judgment:

March 1, 2011

Course of Events
Bridgestone Company enjoyed a patent right for design over their tire (hereinafter referred to as the Design). In 2006, Bridgestone Company found that a tire manufactured by Bull Company was exactly the same as the Design, and therefore started infringement litigation over the patent for design with the Beijing No. 2 Intermediate People’s Court of P.R.C.

During the litigation, Bull Company presented a prior design defense. After the hearing, the court of first instance held that the prior design defense was tenable and did not constitute an infringement on the patent for design. Therefore, the court overruled the claims put forward by Bridgestone Company.

Bridgestone Company was dissatisfied with the judgment of first instance and appealed to the Beijing Higher People’s Court of P.R.C. The Higher Court affirmed the original judgment after a hearing.

Bridgestone Company was dissatisfied with the judgment of second instance and filed an application for retrial with the Supreme People’s Court. Through the hearing, the Supreme People’s Court held that the original judgment was wrong in application of the law and retried the case.
After the hearing, the Supreme People’s Court issued a final judgment that reversed the judgments of the first and second instance and decided that the defendant in the first instance shall cease the production and sale of the infringing tire. The court also required Bull Company to destroy the model and stock of the tire and reclaim the stocks from the distributors and destroy them, and pay for damages to Bridgestone Company.

Disputed Issues
1. The method of examination and judgment of the prior design defense in the determination of an infringement of the patent for design.

2. Whether the accused infringing product falls into the protection scope of the Design.

3. Burden of the civil liability of infringement.

Judgment of the Courts
Court of first instance
(1) The defendant presented its prior design defense and provided evidence of prior design. When applying a prior design defense, only the accused infringing product needs to be compared with the prior design to decide whether they are identical or similar.

(2) Although the accused infringing product constituted a similar design to the Design, it also constituted a similar design with the prior design when comparing them as a whole.

Therefore, the prior design defense claimed by the defendant is tenable, and accordingly, it does not constitute an infringement on the patent for design.

Court of second instance
When judging whether the design is identical or similar, the decision should be based on the knowledge and cognitive ability of average consumers. Comparing the accused infringing product with the prior design, it can be found that they are similar as a whole. The difference insisted by Bridgestone Company was not a significant impact on the overall visual effects. Consequently, the accused infringing product and the prior design constituted only a similar design.

Therefore, Bridgestone Company’s grounds of appeal are untenable.

Court of retrial
(1) When judging whether the prior design defense of the accused infringer is tenable, the accused infringing product should be compared with the prior design first to confirm whether they are identical or have no substantial differences. If the accused infringing product is identical with the prior design, the prior design defense would be tenable. If not, it should be further decided whether they have substantial differences or constitute similarity. When judging the similarity, if there is only a simple comparison between the accused infringing product and the prior design, the difference between them and the effects on both of the overall visual effects from the difference may be ignored. This may lead to a wrong judgment and lead to a situation where the design of the accused infringing product, prior design and the Design all constitute similarity. Therefore, when the accused infringing product is different from the prior design, in order to draw a correct judgment conclusion on the infringement of patent for design the prior design should be used as the base, and then a separate comparison conducted among the accused infringing product, the prior design and the patent for design and to make a comprehensive judgment. During this process, attention should not only be paid to the difference and the similarity between the design of the accused infringing product, the prior design and the impact on the overall visual effects, but also the difference between the Design, the prior design and the impact on the overall visual effects. Whether the design of the accused infringing product makes use of the difference between the design patent and the prior design should also be taken into consideration when judging whether there is a substantial difference between the design of the accused infringing product and the prior design.

(2) In this case, the accused infringing product is not identical with the prior design. In terms of the difference among the accused infringing product, the Design and the prior design, the difference between the Design and the prior design brings conspicuous impact on the overall visual effects. As the accused infringing product makes use of the above difference, the above difference also constituted the difference between the accused infringing product and the prior design. Compared with the similarity between the accused infringing product and the prior design, this similarity brings a more conspicuous impact on both of their overall visual effects. From the perspective of average consumers, the accused infringing product is not identical with the prior design, and they bear no substantial similarity on the overall visual effects.

Therefore, the prior design defense was not tenable, and accordingly the accused infringing product constitutes an infringement on the patent for design.

Our Comment
Although the prior design defense was stipulated expressly for the first time after the third amendment of the Patent Law of the P.R.C, there have been precedents recognized earlier in the judicial practice. However, as there are no explicit provisions on its principle of application and method of judgment, the way of handling the cases by each court vary accordingly.
As for infringement litigation over patents for design, when the defendant presents a prior design defense, the viewpoints of the courts of first instance and second instance are that it only needs to compare the accused infringing product with the prior design, and it compares the accused infringing product and the Design only when the accused infringing product and the prior design are not identical and similar.

With respect to the above viewpoint of the court, we are of the opinion that it lacks legal basis and is not in accordance with the purpose of the legislation. Thus, as the agent of Bridgestone Company, we filed an application for retrial and the Supreme People’s Court retried this case.

 From the written judgment of the Supreme People's Court, we can see that the Supreme People's Court expressly denied the method that only compares the accused infringing product with the prior design and then decides whether the prior design defense is tenable or not when the accused infringing product is not identical with the prior design. The Supreme People's Court held that infringement should be judged according to the following steps when the accused infringer presents a prior design defense in the infringement litigation of the patent for design:

Step 1:  Compare the prior design with the accused infringing product. If they are identical, the prior design defense is tenable and accordingly the infringement is not tenable.
Step2: If they are not identical, the prior design should be used as the coordinate, and then a separate comparison conducted among the prior design, the accused infringing product and the Design. The comparison should also be based on whether the accused infringing product makes use of the difference between the Design and the prior design as well as its impact on the overall visual effects so as to decide whether the accused infringing product is similar to the prior design and the Design.
It can be seen that the reasoning of the Supreme People’s Court took into full consideration the comparison of the Design and the prior design so as to seek a balance between the benefit to the patent holder of the patent for design and that of the public. This method is in accordance with the purpose of the legislation for the design and the prior design defense. Therefore, the Supreme People's Court has made a fair judgment in this case. However, as this method requests a separate comparison among the three designs and needs a comprehensive consideration of the impacts on the visual effects brought by the differences and similarities, it has a high requirement for a judge’s ability. We expect that the local courts can apply the prior design defense correctly in future judicial practice.

Author: Wei Chixue Law Firm

Link roundup

1. "Infographic: Mega Shark vs Crocosaurus."

2. "In China, where a growing demand for organ transplants coupled with a dramatic shortage of donors has fuelled a rampant black market trade, selling your organs for cash is a mouse click away." Via.

3. Guidance (but not instructions) on how to knit the Companion Cube sweater that was featured on various sites last week.

Link roundup

1. China is such a large market that its tastes will become more dominant in consumer items:

When Mercedes-Benz set out to design a new S-Class luxury saloon, to hit showrooms in 2014, Daimler flew 100 Chinese consumers to customer clinics in Germany and the US to ensure they had input in the car’s design.

But the Chinese car boom is shaping the look of some mass-market cars too.

When General Motors designed its LaCrosse saloon, the brand, which is popular in China, devised a roomy and plush rear seat of the kind that Chinese owners – many of whom have chauffeurs – prefer.

2. From a post about the upcoming tv show about Pan Am:

My mother often shared stories with my sisters and me about her training at an “Air Career School,” where students (all women) lived together in dormitories and learned how to become Stewardesses. It was when she exclaimed “And I always was able to eat the pecan pie!” that I understood how times have changed. Each Stewardess-In-Training was weighed every week, and if they gained any weight over the last week, they weren’t allowed to have any of the desserts that they prominently displayed at every meal.

3. Top mp3s are now only 69 cents (and come with free cloud storage) in Amazon's store.

Link roundup

1. Great, long article about Stephon Marbury's continuing adventures in China. Via.

2. Serious Eats: Passover Recipes We Love.

3. "Which HBO pilot has more nudity: True Blood or Game of Thrones?" A detailed analysis by io9.

Judgment of Similarity of Designs in China

We have a treat for readers interested in China - a thoughtful article by Mr Liqiang Chang of Linda Liu & Partners discussing assessment of similarity in China with reference to two cases, reprinted with their kind permission from their IP NEWS issue 44 December 2010. The discussion has obvious resonances of the recent US debate on "point of novelty" versus "overall impression" assessments. Enjoy!

Judgment of Similarity of Designs under the Background of New Judicial Interpretation

Article 11 of the Interpretation of the Supreme People's Court on Several Issues concerning the Application of Law in the Trial of Patent Infringement Dispute Cases (Judicial Interpretation 21 (2009)) (hereinafter referred to as Judicial Interpretation) which came into force January 1, 2010 provides:
Article 11. When judging whether designs are identical or similar, the people’s court should conduct comprehensive judgment based on the design features of the patent design and the design accused of patent infringement as well as the overall visual effect of the designs; and consideration shall not be given to design features that are determined mainly by technical functions or features, such as the material and internal structure of a product, which do not influence the overall visual effect of a product.
In the following circumstances, the overall visual effect of a design is usually affected to a greater extent:
(a) the parts of a product, which can be seen easily when the product is used normally, have a more notable influence on the overall visual effect than the other parts of the product;
(b) the design features distinguishing a patent design from a prior design have a more notable influence on the overall visual effect than the other design features of the patent design.

Where a design accused of patent infringement is not different from a patent design in terms of the overall visual effect, the people’s court should ascertain that the two designs are identical; where a design accused of patent infringement is not substantively different from a patent design in terms of the overall visual effect, they should be ascertained as similar.
As shown above, the Supreme People's Court sticks to the previous principle, “whole observation and comprehensive judgment,” to judge similarity of designs. The Judicial Interpretation also introduces to this principle some new ideas which are embodied by the following point: it is prescribed that design features distinguishing a patent design from a prior design have a greater impact on the overall visual effect of the design than other design features of the patent design. Many applicants and patent agents have the following questions about the approaches for judging similarity of designs as provided by Article 11 of the Judicial Interpretation: Can we judge similarities between a design accused of patent infringement and a patent design only based on whether or not the accused design has the design feature which distinguishes the patent design from a prior design? Whether the courts should introduce a prior design ex officio or if it should be presented by the concerned party as evidence? How to reflect the principle of “whole observation and comprehensive judgment”? Now, the writer will give his opinions on the above questions.
For quite a long time, there has been a dispute in the field of design practice over the approaches of judging similarity of designs. The issue is whether or not we should compare the major parts of designs, or the inventive features of a patent design or the features of a patent design which distinguish it from a prior design? This dispute was reflected for the first time in the “judgment by comparing notable parts” approach established in the Guidelines for Patent Examination of 2001. In 2002, in a case about the validity of a design patent of a storage compartment at the tail of a motorcycle, the above dispute led to a result in which the court and the Reexamination Board came to completely contrary conclusions. Because such a dispute caused uncertainty in the application of law, the concept “notable part” was abolished and the principle “whole observation and comprehensive judgment” was established in the Guidelines for Patent Examination of 2006. The principle “whole observation and comprehensive judgment” has been followed until now and is universally acknowledged by members of the design practice field including the courts and the Reexamination Board.
However, we also noticed that there still exists a perspective that similarity of designs should be judged based on the inventive features of a patent design or features of a patent design which distinguish it from a prior design. For example, Article 12 of the Interpretation of the Supreme People's Court on Several Issues concerning the Application of Law in the Trial of Patent Infringement Dispute Cases (versions for comments) provides:
Article 12. When judging whether designs are identical or similar, the people’s court should comprehensively consider all the design features within the protection scope of the design patent. However, consideration shall not be given to the sole design feature which has to be adopted for realizing the technical function of a product or features, such as the material and internal structure of a product, which do not influence the overall visual effect of a product.
Where the relevant public may confuse a design accused of patent infringement with a patent design in terms of the overall visual effect, the people’s court shall consider the design accused of patent infringement and the patent design to be similar. Where a design accused of patent infringement does not have the essential features of a patent design, it shall be considered that the design accused of patent infringement and the patent design will not confuse the relevant public in terms of the overall visual effect.

The above-mentioned essential features refers to design features with which a patent design, as compared with a prior design, can have a notable visual effect on the relevant public. The people’s court may identify the essential features of a design by referring to the brief explanation of the design.
According to the above provision, if a design accused of patent infringement does not have the essential features of a patent design, then it will not cause the relevant public to confuse the two designs in terms of the whole visual effect; that is, they are not similar. In other words, during the judgment process, there is no need to determine the effect other design features have on the whole visual effect if they are not essential features. Such an opinion is contradictory to the generally acknowledged principle of “whole observation, observation and comprehensive judgment.” Therefore, the above Article 12 was deleted in the final version of the Judicial Interpretation officially published at the end of December 2009 and Article 11 of the Judicial Interpretation introduced the principle of “whole observation, observation and comprehensive judgment” which incorporates the aforementioned new ideas.
As it can be seen from the Supreme People’s Court’s amendments to Article 12 of the Judicial Interpretation (version for comments), similarities between a design accused of patent infringement and a patent design cannot be determined only based on whether or not the design accused of patent infringement has the design features of the patent design which distinguish it from a prior art. Generally speaking, the inventive parts of a design, i.e., the design features of a patent design which distinguish it from a prior design, have greater influence on the whole visual effect of the design, so they deserve more attention. However, the basic standard for judging whether designs are identical or similar is the whole visual effect. That is to say, we cannot consider a design accused of patent infringement and a patent design to be similar or dissimilar only on the grounds that the accused design has or has not the features of the inventive parts. The final judgment should be made based on whether the two designs are different in the whole visual effect.
The courts have decided several cases since the new Judicial Interpretation was implemented. Although the courts followed the previous patent law when trying the cases because the patent infringements involved took place before the new patent law took effect, we can still get a hint of a trend in applying the approaches for judging similarity of designs, which were established in the new Judicial Interpretation, to the trial of patent infringement dispute cases. The writer will make an analysis with the following two typical cases.

Case 1: Design patent infringement dispute appeal case—Fu’an Bojie Electrical Machinery Co., Ltd V. Shanghai Rongtai Fitness Tech. Development Co., Ltd, No. 177 (2009)

Final Judgment of IP Tribunal of Zhejiang Higher People's Court

A brief introduction to the case: the plaintiff, Shanghai Rongtai Fitness Tech. Development Co., Ltd (hereinafter referred to as the plaintiff), filed a patent application for the design of a “massage chair (deluxe)” on December 29, 2006 and was granted a patent right on January 09, 2008. However, when the patent right was still valid, the plaintiff found that the deluxe multifunctional massage chair (hereinafter referred to as the accused product) manufactured by the defendant Fu’an Bojie Electrical Machinery Co., Ltd (hereinafter referred to as the defendant) had infringed the above patent right of the plaintiff, and the plaintiff filed a law suit against the defendant. During the trial of the case, the defendant, on the basis of a prior design 1, filed a request to the Reexamination Board of the SIPO (hereinafter referred to as the Reexamination Board), requesting the Reexamination Board to declare the concerned patent invalid. After examination, the Reexamination Board made a decision that the patent right remained valid. After trying the case, the First-Instance Court ruled that the defendant’s infringement of the patent right was a fact. The Second-Instance court upheld the original judgment.

Focus of dispute in this case: How did the inventive part of the patent concerned influence the judgment of similarity?

In its decision No. 13126 that the patent right remained valid, the Reexamination Board held that a normal consumer distinguishes one massage chair from another mainly from the unconventional designs, which are different from the designs of a common chair. Except for the conventional designs, the patent concerned and the prior design were different in the shape of the two sideboards and the differences had a notable impact on the overall visual effect, so the validity of the concerned patent was maintained.
The Court of Final Appeal held that the notable differences between the concerned patent and the prior design constituted the inventive part of the patent. On the basis of the statements of the concerned parties in the invalidation procedure and the decision of the Reexamination Board, the Court of Final Appeal held that the inventive part of the patent should be the appearance of the sideboards. After comparing the design features of the product accused of infringement and the concerned patent, the Court of Final Appeal concluded in its written judgment that “the overall appearance of the product accused of infringement, especially the appearance of its sideboards, is not notably different from the patent design in terms of visual effect and it is easy for a normal consumer to mistake the product accused of infringement for the patent design, so the two designs are similar and the product accused of infringement falls into the protection scope of the concerned patent .”

As can be seen from this case:
1. The feature of an inventive part is an important factor which has an impact on the overall visual effect, but the fundamental criterion for judging whether designs are identical or similar is the overall visual effect (“the overall appearance of the product accused of infringement, especially the appearance of its sideboards, is not notably different from the patent design in terms of the visual effect”).
2. When comparing the similarity between a patent design and a design accused of infringement, if the concerned party puts forward a prior design, then the features different from the prior deign should be identified and determined on the basis of producing evidence and a cross-examination by the concerned parties. Generally, the courts do not directly introduce prior designs or request the party concerned to provide a prior art.

Case 2: Foshan Shunde Xinshengyuan Electrical Appliances Co., Ltd. sues Shanghai Meixin Plastics Co., Ltd. for design patent infringement, No. 285 (2007)

First-Instance Judgment of Shanghai No.1 Intermediate People’s Court No. 5 Civil Tribunal (IP Tribunal)

A brief introduction to the case: The plaintiff, Foshan Shunde Xinshengyuan Electrical Appliances Co., Ltd. (hereinafter referred to as the plaintiff), enjoyed the design patent right of a product called “blower.” The plaintiff found that the defendant, Shanghai Meixin Plastics Co., Ltd. (hereinafter referred to as the defendant), manufactured a blower with the same appearance as that of the patent product of the plaintiff when the patent was still valid, so the plaintiff filed a lawsuit. During the trial of the case, the defendant filed a request to the Reexamination Board of the SIPO (hereinafter referred to as the Reexamination Board), requesting the Reexamination Board to declare the patent invalid. After examination, the Reexamination Board made a decision that the patent right remained valid. The court held that the product accused of infringement was similar to the plaintiff’s patent product as shown in the picture in terms of the overall visual effect, so it fell into the protection scope of the design patent right held by the plaintiff.

Focus of dispute in this case: if a product accused of infringement did not have the features as described in the brief explanation of the concerned patent, is it definite that the accused product did not constitute an infringement?

In this case, the plaintiff described in the brief explanation of the concerned patent “a shell of the product incorporating the present design is made of a transparent material.” The product accused of infringement was made of a non-transparent material, so the defendant argued that the accused product was not similar to the patent concerned. When judging the similarity between the two designs, the court made a comparison of the essential features shown in the picture of the patent and concluded that the essential features of the accused product’s design were similar to those of the plaintiff’s design. As for the defendant’s affirmation that the feature of “a shell of the product incorporating the present design is made of a transparent material” as described in the brief explanation of the concerned patent notably influenced the overall visual effect of the product, the court held that the brief explanation is a concise description of the essential features of the design, the omitted views, and the colors for which protection is sought. By comprehensively considering the similarity of the essential features of the two designs, it could be determined that the description in the brief explanation did not influence the judgment that the accused product was similar to the plaintiff’s patent product as shown in the picture in terms of the overall visual effect, even though the plaintiff descried in the brief explanation of the concerned patent that “a shell of the product incorporating the present design is made of a transparent material.”

As can be seen from this case:
Although the product accused of infringement does not have the features described in the brief explanation of the concerned patent, it may still constitute an infringement of the patent concerned. The key to making a judgment is whether or not the overall visual effect will be rendered different if the accused product does not have the features described in the brief explanation.

Concluding Remarks

The foregoing are the writer’s opinions on some controversial issues about the judgment of similarity of designs under the background of the new Judicial Interpretation. With the above analysis, the writer hopes to help applicants better understand the principles of judging similarity of designs. Since China does not apply Case Law, the above-mentioned two cases are for reference only. We hope that the judicial department can further clarify the specific comparison principles for the judgment of design patent infringements in the Judicial Interpretation so that patentees and the public can have a more reasonable and clearer expectation about the exercise of a design patent right.

China update

I attended a seminar on re-examination and invalidation in China on 14th October, hosted by Linda Liu Group in Beijing, dealing with the 2009 changes to the law and 2010 changes to the Implementing Regulations and Guidelines. The speaker was Mr Zhang Hanguo of the SIPO Patent Re-examination Board. I hope to report in more detail elsewhere in future.

Here are some design-related points of interest for now:

• Two interesting recent cases on "reference views" were discussed, one concerning reclining sofas, and the other security doors. "Reference views" are additional views, commonly used in Japan, showing the product in use in various states (perhaps where different parts are opened, closed or otherwise moved). The issue was whether these should be taken into account, or ignored. The latest opinion of the Board (a shift from their former opinion) seems to be that there is no legal basis for ignoring them, and that they should therefore be taken into account for both validity and scope.
• He also discussed a recent invalidation case on a car design, compared to two generally similar designs. The Board had held that the similarities in body shape were caused by functional (i.e. aerodynamic) reasons, so that differences in headlight shape and at the rear of the car made the design valid. At first instance the Court overruled the Board and invalidated the design. The case is still pending at second instance. It makes a particularly interesting comparator for European eyes, since similar evolving car design situations were considered by the Swedish court in DaimlerChrysler's Application ([2005] E.C.D.R. 15) (in which the design was held invalid), and in the DaimlerChrysler v Centigon stretch limo infringement case, reported on this blog (in which the first instance German court held the design valid). Perhaps the issue of headlights deserves special treatment - to many, the front of a car resembles, and is as recognisable as, a human face, making headlight differences particularly striking.
• Design examination may be a bit stricter in future. SIPO hope to further study and standardise examining for whether designs significantly differ as, at present, even examiners with some years of experience may still sometimes have difficulty.
• Article 25 of the Patent Law has been amended to add an exclusion of "Designs of two-dimensional printed goods, comprising a pattern, a color or the combination of the two, which serve mainly as indicators." Apparently the indication can be of use, purpose or source. This provision will presumably therefore eliminate much potential overlap with logo trade marks.
• Where an application is found to contain multiple designs (a "lack of unity" situation) some of them may now be abandoned in response in the same way as where patent claims lack unity.
• Where invalidation is based on an earlier right rather than prior art, the applicant for invalidation can (indeed, must) now give proof that they are the prior rights holder or interested party but is no longer required to provide an earlier efffective ruling or judment by the Court or executive showing conflict with the earlier right (Sec 3.2 Guidelines based on Rule 66.3 of the Implementing Regulations). "Interested party" includes anyone who could enforce the earlier right - presumably an exclusive licensee for instance. (Sec 3.2 Guidelines based on Rule 66.3 of the Implementing Regulations).

We have perhaps not given China the coverage it deserves in the past.  I am not sure this blog is accessible from within China, but we are happy to post any China-related material readers may have.

Designs in China: Tian Lipu speaks

An item in the most recent OAMI News, "Industrial design “key element” for China", reports that Commissioner Tian Lipu (head of the Chinese State Intellectual Property Office) has spoken of the importance of industrial design in his country’s IP strategy. In this video interview he said that China was putting increasing emphasis on innovation and creativity as it attempted to move from being considered simply as a manufacturing location to a more design-oriented approach.

Opinions regarding China are clearly divided at the moment. Those who put a positive spin on things are emphasising the steps the country is taking to make all IP enforcement a more viable and sometimes even attractive proposition for foreign businesses investing there. Others will be more cynical: while accepting that China recognises the importance of industrial design, they'd like that recognition to take the form of not seeking to register or manufacture non-Chinese designs.

Effect of New Chinese Design Rules

New Implementing Regulations for the Chinese Patent and Design Law took effect on Feb. 1st, 2010. The Chinese Patent Office (SIPO) background briefing is here:

We are grateful to three fine Chinese firms (and, as always, any misunderstandings or errors are almost certainly at our end); Unitalen have a summary of the effects of the new Regulations in their Newsletter Special Edition of 26 January 2010, Sanyou have a comparative table setting out the differences between the old and new Regulations in their newsletter of 31st March 2010, and CCPIT have published a consolidated version of the current Regulations here.

Three particular provisions strike us as interesting. Firstly, under new Rule 35, the conditions for filing "multiple design" applications are tightened. All products concerned must be in the same class. There can be no more than ten in the same application. There must be a basic design and the other designs must be similar to it (though not necessarily to each other).

Secondly, the requirements for the mandatory the "brief description" are clarified. We quote from CCPIT's translation of Rule 28:

A brief explanation of a design shall include the title and usage of the product incorporating the design, the essential portion of the design, and designate a drawing or photograph which best represents the essential portion of the design. Where the views are omitted or there are colors for which protection are sought, it shall be indicated in the brief explanation.
Where one application for a patent for similar designs incorporated by the same product is filed, one of the designs shall be designated as the basic design in the brief explanation.
The brief explanation shall not contain any commercial advertising and shall not be used to indicate the function of the product.

In this Rule, the requirements for indicating the "basic design", the name and the usage of the product, and the most representative drawing, are new.

New Rule 31 deals with the very common situation where the priority filing lacks such a brief description (it is not mandatory in EU or the US for example). It provides that priority is not lost provided that the brief explanation submitted in China does not go beyond the scope of the drawings or photographs in the earlier application. However, it seems doubtful whether the "usage", for example, would always be described in the earlier application, so the comfort offered by Rule 31 is limited. It may be safest to file a China-compliant description in their priority application even where it is not mandatory (or even where it is forbidden) to do so.

The third interesting provision concerns designs made by employees (or, as we should perhaps call them in this context, the working class). Rules 76-78 provide that (where there is no contract governing the matter) the employee is entitled to compensation comprising "prize money" (due within three months of grant) of at least 1000 yuan (about $150), and thereafter a royalty of at least 0.2% of profits from the design. If the rights are licensed, the designer is entitled to 10% of the incoming royalties.

Personally, I am in favour of such employee compensation schemes (provided they don't break the bank), as they have the advantage of getting at least the designers on board for IP protection in an IP-sceptic world. These fairly modest Chinese provisions are the first I have seen in relation to designs. The prize money is a third, and the royalty rate a tenth, of that for an invention patent and, whilst there is no micrometer for quantifying such things with precision, the lower level of compensation seems appropriate as designs tend to be easier to design around and have been subjected to less scrutiny as to validity. What do readers think?

China's new Supreme Court interpretation of Scope of Designs

We learn from the excellent IP NEWS published by Linda Liu & Partners that the Chinese Supreme Court has published new interpretation of the scope of patents, designs and utility models. These took effect on 1st January 2010. Articles 9 to 11 are particularly relevant to designs. A Chinese version is here.
We reproduce below, with thanks, the translations by Linda Liu & Partners, noting that those parts amended since the consultation document in June 2009 are underlined. From a European point of view, we note the "overall impression test", but also the significance of the written description of the design in defining its "essential features".

Interpretation of the Supreme People’s Court on Several Issues Concerning the Application of Law to the Trial of Patent Right Disputes
(translation by Vera WEI of Linda Liu & Partners)

Article 9 The People’s Court should determine “the scope of protection afforded by a design patent” prescribed in Article 59.2 of the Chinese Patent Act with reference to an identical or similar design with the patented design used on the identical or similar categories of product as the design patent product. Where the categories of products are identical or similar but the allegedly infringing design is not identical or similar to the patented design, or where the allegedly infringing design is identical or similar to the patented design while the categories of products are not identical or similar, the People’s Court should hold that the allegedly infringing design does not fall into the protection scope of the design patent.

Article 10 Products within the same category referred to in Article 9 of this judicial interpretation means products for the same use; products within similar categories means products for similar uses. The People’s Court can determine the use of a product by referring to the International Classification of Designs, the name and function of the product described in the brief description, and other factors such as sale and actual use of the product.

Article 11 The People’s Court should determine whether designs are the same or similar based on the perceptions of the relevant public to the product of the design. “Relevant public” referred to in the preceding paragraph means one who has basic knowledge about the conditions under which the patented design was created and is able to distinguish the divergences in shape, pattern, and color amongst different designs but who will not pay special attention to minor differences in the shape, pattern, and color of designs.

Article 12 The People’s Court should determine whether designs are the same or similar by considering the overall visual effect of designs and all the design features within scope of protection afforded by the design patent. However, the only one design feature that can achieve the technical effect of the product and those features that cannot affect the overall visual effect, such as the material and internal structures, shall not be taken into consideration. Where the allegedly infringing design and the patented design are so similar that it can confuse the relevant public, the People’s Court shall hold the allegedly infringing design is similar to the patented design. Where the allegedly infringing design does not contain the essential features of the patented design, it should be assumed that the allegedly infringing design will not cause confusion to the relevant public with regard to its overall visual effect. The essential features of a design referred to in the preceding paragraph means the features of a patented design that causes a prominent visual effect in the relevant public when compared with existing designs. The People’s Court can identify the essential feature by referring to the brief description.

Coming soon: new design law for China

In around three weeks, on 1 October 2009, the 2008 Third Revision of China's patent law comes into force according to the first in a series of articles written for Intellectual Property Watch by SIPO researcher Wenting Cheng.

Ms Wenting explains that China has an omnibus patent system which incorporates protection of designs and utility models as well as conventional patents. As to patentability of designs she writes:

" ... Patent Law (2008) Article 23 adds a new section, providing that the design on which a patent may be granted must be substantially different from any prior designs or a combination of the features of prior designs. Any design on which a patent may be granted must not be in conflict with any prior legitimate rights of any other person. The prior design referred to in this law means any design known to the public before the filing date of the patent application in China or abroad.

This newly added provision defines two standards to determine the patentability of a design: one is substantial difference and the other is that it is not in conflict with prior rights. Details on these standards are included in the Implementing Regulations of Patent Law and Guidelines for Examination which undergo revisions accordingly. Specifically, major changes take place in the post-grant stage since there is no substantive examination in granting design patents in China".

For further details, including how to tell whether two designs are identical, you can read the full article here.

Car Wars

We have been debating designs in the automotive sector in Europe for decades - but it has all been about spare parts. Car companies haven't been ripping each other off, and spares makers haven't been putting the parts together to make the whole. Well, welcome to the 21st century - the game has changed, and its name is now China. There's even a ripoff Rolls out there.

Most recently comes the Beijing decision on the Neoplan Bus GmbH (a MAN subsidiary) v. Zhongwei Bus & Coach Group, its subsidiary Zonda Industrial Group and its sales agent Beijing Zhongtong Xinhua Vehicle Sales Co. Their A9 bus is a dead ringer for Neoplan's, but at a third of the price. Good news - they won.

Zonda's website contains a sturdy rebuttal describing their ludicrous (and ultimately unsuccessful) counterclaim that the Germans were the ones ripping them off. Here's how they put it, in terms that every pirate wishes were true (it often is in China, it seems):
"In fact, this kind of lawsuit is not uncommon in the automobile industry. Toyota once filed a lawsuit against Geely, a Chinese car maker, for allegation of intellectual property right violation, but it is often the defendant sides win such lawsuits because there is no commonly accepted way in judging whether an automobile model has copied another or not."
Alas for them, producing a dead copy of a market leading design does tend to be an accepted way of spotting a knockoff. So does repeated and systematic copying. So they lost - or at least, they lost that round (they claim to be appealing).

• http://www.chinadaily.com.cn/bizchina/2009-01/22/content_7419231.htm
• http://english.ipr.gov.cn/ipr/en/info/Article.jsp?a_no=270390&col_no=126&dir=200903
• http://www.sipo.gov.cn/sipo_English/news/internationalip/200904/t20090417_454486.html

(NB: Zonda's reference to the Geely case goes back to 2003, when Toyota brought a trademark claim against Zhejiang Jili (same people as "Geely"?) for copying their logo - they lost, on the basis that this wasn't a "bag of sweets" case, the car customer was reasonably discerning. Well, yes, up to a point, Lord Copper. The very wonderful IPDragon blog reported that Yamaha were a bit more successful in getting back their mark which was pirated by two Chinese motorbike companies, and Honda took some cash off Lifan for using "Hongda" - well, who'd have thought that would be too close? )

Back to designs. Honda brought the first big Chinese test case back in 1997 against Shanghai Feiling Motorcycle Co. and Zhejiang Huari Co; their “mini-scooter” design was held invalid along the way but by 2004 their appeal had finally been upheld, at third instance. My recollection is that they lost in the end, but perhaps that is just natural pessimism; does anyone out there recall the outcome?

Their WAVE motorbike was also copied and Chinese exports went all over Asia. They had varied success in killing off the infringers. They took a beating in China when, in 2003, they sued Shuanghuan for infringement of the design of their CR-V SUV. Also in 2003, General Motors sued Qirui (same company as"Chery"? and perhaps "Geely" or "Jili"?) for infringement of their Daiwoo Matiz car compact design. That one apparently settled, reputedly on bad terms for GM.

Flushed with success, Shuanghuan pirated BMW's X5 SUV. Apparently fearing the same outcome as GM, according to MIP, the Bavarians let the infringements run in China but went for Shuanghuan in September 2007 on their home turf in Frankfurt, and got an interim injunction preventing them from launching at the Frankfurt auto show. At the same show, DaimlerChrysler kept Shuanghuan's Noble (a clone of the amazing Smart microcar) out of the show.

The latest is between the same opponents, but in Turin, triggered by the Bologna Auto Show. According to Trevizan & Cuonzo (look under Legal Update), DaimlerChrysler sued over two infringing models using both International Design registrations and a CTM shape mark, and posted one success and one failure on the design, but both infringed the trade mark.

With the world's oldest civilization, biggest population, best engineers and lowest prices already in their favour, isn't it time to ask why so much of China's automotive industry (remember, we haven't even looked at the spare parts and tyre ripoffs) is dedicating itself to such blatant piracy? It's not as if China is short of the brains to design their own cars, so why don't these companies do so? And, more worryingly, why they should think such obvious cut-price copies are going to be accepted meekly in the EU? Europe's auto industries may be looking pretty sick, but are they really giving off such signs of weakness that launching copies at major trade shows is an option?

We could urgently do with some strong, positive messages from the European courts that innovation and good design will be protected, and that obvious and blatant copying helps nobody. The confusion test isn't enough; even if the public intellectually know they're getting a cheap fake not the real thing, the subtle message is that the fakes are "as good as" the real thing. Don't believe me? Well, according to the according to the German importer, the litigation "elevates our products to the same level as BMW and Smart." Really? I think not. But in the long run, unless the EU takes IP enforcement seriously, the triumph of piracy may well bring the death of quality in the automotive sector.