Since its establishment, Shanghai Intellectual Property Court has given full play to the leading role of judicature in IPR protection, strengthened the reform and innovation in IPR trials, and positively responded to the demands for IPR protection and building a specialized, international, legalized and facilitating business environment in China (Shanghai) Pilot Free Trade Zone. From January 1, 2015 to December 31, 2017, the Court accepted 645 intellectual property cases in total, with 594 concluded. The main initiatives are as follows:    

I. Improve the Working Mechanisms to Respond to the Demand for Specialized IPR Protection in FTZ

1. Establishing special trial mechanism. The Court formulated Opinions of Shanghai Intellectual Property Court on the Establishment of a Special Collegial Panel for FTZ-related Intellectual Property Cases and established a special collegial panel with the President, Division Heads and Senior Judges serving as the presiding judges; it also developed special management software for FTZ-related intellectual property cases and worked together with the FTZ Intellectual Property Division of Pudong New Area People’s Court of Shanghai to strengthen the analysis and study of application of laws and to unify the adjudication criteria.

2. Improving the “four-in-one” technical fact-finding mechanism. The Court invited technical investigators to participate in the proceedings as judicial assistants and established a technical fact-finding mechanism that integrates technical investigation, expert jury, technical appraisal and technical consultation to enhance the specialized trials of technology-related cases.

3. Perfecting the diversified dispute resolution mechanism that conforms tothe characteristics of FTZ-related cases. The Court signed cooperation agreements with 11 social mediation organizations and industry associations, invited mediators to conduct mediations regularly, promoted pre-trial mediation, in-court mediation and the link between litigation and mediation, and made full use of commercial and trade mediation organizations to resolve the disputes quickly and properly.

II. Optimize the Judicial Ideas to Respond to the Demand of Building an International Business Environment in FTZ

1. Insisting on equal protection of the legitimate rights and interests of Chinese and foreign parties. The Court responded positively to the interest and judicial demands of global investors and traders in FTZ in terms of rights protection, competition order, and risk prevention and control, etc. It respects and equally protects the intellectual property rights of all market players.

2. Accurately grasping the characteristics of export-oriented economy in FTZ. When trying cases, the Court considered the special economic pattern in FTZ comprehensively and distinguished the boundaries of infringement accurately. For example, in cases where the overseas trademark owners entrust domestic enterprises to process the goods to be exported, should all these goods be exported, it won’t be deemed to infringe upon the exclusive right of domestic trademark owner to use the registered trademarks.      

3. Promoting the international influence of judicial protection. The Court made full use of the International Exchange (Shanghai) Base for Judicial Protection of Intellectual Property to actively carry out high-level and high-quality international IPR judicial exchanges and cooperation, so as to expand the brand effects and demonstrate the achievements, thereby enhancing the international influence of China’s IPR judicial protection.  

III. Strengthen Protection to Respond to the Demand of Building a Legalized Business Environment in FTZ

1. Clarifying the rules of judicial adjudication. When trying cases involving the new economic form, business model, industrial field and high technology in FTZ, the Court paid attention to the accumulation of typical cases, providing practical materials for the formation of trial ideas for similar cases. It also formulated Guidelines on the Trial of Disputes over Trade Secret Infringement, Guidelines on the Trial of Disputes over Design Patent Infringement, Operational Guidelines on the Judicial Authentication of Technical Facts in Civil Intellectual Property Cases and other guidance documents, providing reference and effective guidance for the trial of similar cases.

2. Actively using interim measures. The Court brought into full play the timeliness, convenience and effectiveness of judicial relief, and actively promoted the efficiency of preservation before and during litigation. For example, In the case of pre-litigation act preservation filed by Data Yes, the Court made the judgment in favor of the preservation on that very night and meanwhile took measures to control the defendant, preventing the disclosure of trade secrets timely and protecting the legitimate rights and interests of the right holder effectively.

3. Increasing the amount of compensation. With full consideration of the objectivity and uncertainty in the market value of intellectual property rights, the Court analyzed the factors that determine the statutory damages and gradually established a compensation mechanism based on the market value of intellectual property rights, degree of innovation, and degree of subjective bad faith, etc. For example, in China’s first case involving recognition of overall picture of online game as assimilated works expressed by a process analogous to cinematography, the Court considered the licensing fee of the game involved and nature of the infringement, etc., and ordered the infringer to compensate for the economic losses of RMB 4 million based on the statutory damages.

4. Severely punishing willful infringement. For serious violations of the principle of good faith, the Court imposed severe punishments to enhance the deterrent effect of IPR judicial protection. For example, in the case of dispute over trademark infringement and false advertising filed by HUGO BOSS, et al against Mr. &Mrs. Tang, the Court recognized that Mr. &Mrs. Tang committed joint infringement since they planned the registration of many companies and controlled them directly. It’s ordered that they shall compensate for the economic losses and reasonable expenses (including all attorney fees) totaling RMB 4.92 million, which effectively regulates and punishes their act of covering up large-scale trademark infringement and unfair competition.

IV. Strengthen Service Awareness to Respond to the Demand of Building a Facilitating Business Environment in FTZ

1. Taking the initiative to follow the judicial needs in FTZ. The Court established a cooperative mechanism with the Management Committee of Zhangjiang High-tech Industrial Development Zone and Pudong Intellectual Property Administration respectively, set up Office of Judge Chen Huizhen, National Adjudication Expert, and Office of Judge Ding Wenlian, National Adjudication Expert, and carried out surveys, distributed casebooks, conducted legal publicity and riding circuits in high-tech parks. It also released white papers and put forward judicial suggestions to popularize laws and regulations, alert and prevent disputes, and extended the scope of trial work, thereby serving and safeguarding the building of innovation environment in FTZ.

2. Promoting the “Internet+” trial mode actively. The Court improved online mediation and remote video hearings, etc. to ensure that FTZ-related intellectual property cases are heard conveniently and quickly. It further explores the speedy trial of simple cases and refined trial of complex cases to respond positively to the growing judicial needs in FZT.

3. Exploring the mechanism of service by entrusted notaries. The Court established a mechanism with Shanghai Oriental Notary Public Office. Litigation documents served unsuccessfully will be served by notaries in person, which makes service more standardized and efficient and alleviates the problem of difficult service of documents in FTZ-related intellectual property cases.