PRELIMINARY INJUNCTON – AN EFFECTIVE TOOL FOR PATENT ENFORCEMENT PROCEEDINGS IN CHINA

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(Aauthor: Chuanhong Long, Guoxu Yang; Source: CCPIT)

To combat patent infringements in China, the Chinese Patent Law set up at least three types of remedies for patent holders, namely, preliminary injunction, permanent injunction and damages. Compared with other two, preliminary injunction sometimes may be more desirable by the patent holder as the infringement could be stopped earlier and further losses of the patent holder be avoided. However, the situation so far is that a preliminary injunction usually is difficult to be granted by the Chinese courts.

The major reasons why the Chinese courts are reluctant to grant preliminary injection are because a patent infringement usually is very difficult to be found in a very short time before the trial. If the injunction is eventually found wrong, serious damages might be caused to the alleged infringer. Consequently the Chinese courts would request that the patent holder provide a bond to the court when requesting the preliminary injunction for possible compensation for the alleged infringer.

Nevertheless, in spite of the above reluctance and requirement for bond, the Chinese courts do issue orders of preliminary injunction. One  recent case involved a foreign invested company Abbott Trading (Shanghai) Co. Ltd (Abbott) and two local Chinese companies (manufacturing and seller) in which Abbott accused the Chinese companies infringed its design patent for the tank containing milk powder in the Beijing third Intermediate Court. Upon Abbott filed the petition for preliminary injunction, the court granted the preliminary injunction order very quickly. At the execution of the preliminary injunction, the Chinese companies came to the court and reached a settlement with the plaintiff. According to the record, this is the first preliminary injunction case for patent infringement ever granted in Beijing area.

In another case the plaintiff is Shanghai Novartis Trading Co., Ltd and the defendants are local Chinese drug manufacturer and a drug store. The Patent in dispute relates to the second medical use of Glivec in the treatment of gastrointestinal stromal tumors (“GIST”). Upon the request of the plaintiff, the court granted the preliminary injunction based the reason that if manufacturing and sale were not stopped immediately, the plaintiff would suffer irreparable damages.

As Beijing courts are located in the capital area of China, the developments of Beijing Courts would bring great impact on the other courts all over China. The recent trend of Beijing Court seems to show an indication that the protection strength on patent right would be enhanced, which seems to be a good news to all the patentees including foreign patentees and investors who are doing business or are going to do business in China in the future.

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