Concentrated professionalism--—An interview with the Unitalen litigation team

By Jessie Chen, China IP,[Comprehensive Reports]

In recent years, the cases represented by Beijing Unitalen Law Office (Unitalen) has been frequently selected in the top 10 IP cases and 50 model IP cases of the Supreme People’s Court of the People’s Republic of China.

China IP had an opportunity to have a face-to-face conversation with the Unitalen litigation team including Li Yongbo, Wu Shuchen, Zhang Yazhou, Gui Qingkai, Li Hongjiang, Kong Fanwen, Zhou Dandan, Jing Can, Sun Changlong, Wang Heshu and many other lawyers and patent agents.

Organizational structure determines the development of the team.

Founded in 1998, Unitalen has been focusing on IP issues and has earned a high reputation in the IP field. Especially after China joining the WTO, their concentration on IP law issues made Unitalen develop outstanding achievements in the IP field and earned them fame as “expert in IP litigation.”

As the team leader, Li Yongbo said, “Our most precious treasure is the talents. The cornerstone of our international reputation is our scientific management. Our motivation is to move forward with the entrepreneurial culture. Our team efficiency is powerfully guaranteed by our systematic approach and structure. All of the above elements enable us to offer IP legal services of high quality.”

Supported by the overall structure of IP system in Unitalen, the litigation team takes full advantages their resources, which include nearly 600 patent agents, patent engineers, trademark agents and associates.

“There are some differences between IP cases and traditional civil and commercial cases. IP lawyers are required to have technical knowledge. Moreover, IP cases, especially IP litigation cases, involve many technical issues and tremendous document retrieval work. Thus, clients give more attention to the precision of the organizational system and comprehensiveness of the services of a law firm rather than an individual in the team,” Zhang Yazhou said.

Gui Qingkai and Li Hongjiang, lead counsels for trademark and patent litigation, have their own perspectives after year's representation of litighation cases: “Compared with other law firms, with our specialized attorneys, Unitalen is more than just a law firm. Unitalen can offer one-stop IP services from application, composition, litigation, invalidation, investigation, and reexamination to strategic planning and eventually forming a multi-party, cooperative, commercial agreement.”

Service concepts determine the direction of cases

“Standing in clients’ shoes” is a 3-4/2014 China IP 17 faith held by lawyers from Unitalen. In their eyes, IP litigation is more than just a legal battle. It focuses not just on the immediate economic benefits the clients can obtain, but also on how to make the clients effectively reach or advance their overall operating strategy of increasing their market share through litigation.

Quan You Furniture Co. Ltd. V. Foshan Quan You Sanitary Ware Co. Ltd. involving the infringement of an exclusive use of a registered trademark and unfair competition represented by Zhang Yazhou, won the first instance trial in Shandong Higher People’s Court and was awarded compensation of 14 million yuan. The compensation of this case was the highest one, following “the Great Wall Wine case” (compensation of more than 10 million yuan) and “the YAMAHA case” (compensation of more than 8 million yuan).

As the lawyer of the above case, Zhang Yazhou who also represented BMW and LAFITE in cases of trademark infringement and unfair competition, said that Quan You Furniture Co. Ltd. lost the initial and secondary trials of trademark opposition and reexamination. However, despite under great pressure the Unitalen litigation team won the final victory because of their well-designed litigation strategies, as well as a precise understanding of the judicial trial trend in such cases, especially the judicial trend in such cases from the Supreme People’s Court.

Professional competence determines the success of a case.

Emergencies usually make one anxious, especially when facing a patent litigation started by a large foreign enterprise against a Chinese company, which has gradually grown into an industry leader. When this happens, an outstanding lawyer can not only settle the case itself, but can also play the role of a psychologist as needed.

“In my opinion, a qualified lawyer merely cares about the case itself, while an outstanding lawyer helps the customer out of complicated situations and lets the customer figure the problems out by providing a better, more beneficial perspective,” said Li Hongjiang, who represented Smarter Group in the infringement case of Smarter Group Corporation v.British BWE Co. Ltd.

On April 16th 2013, He Fei Smarter Group Corporation (Smarter Group), a subsidiary of China National Building Material Group Corporation, received a civil pleading from Wu Xi Intermediate People’s Court. The British BWE Co. Ltd. (BWE) claimed that “350*2/450 aluminum tube continuous extrusion cladding machine production line” Smarter Group produced, offered for sale and sold, which Wu Xi Jiangnan Cable Co. Ltd. (Jiangnan Company) purchased and employed was suspected of infringing BWE’s three patents. Thus, BWE sought an injunction and damages of 27 million yuan.

“The Unitalen litigation team first had to conduct its due diligence investigation on the patents of the plaintiff’s claim to fully understand the actual scope of protection,” Li Hongjiang stated. After a detailed analysis of the specifications of the three patents involved, the Unitalen litigation team eventually ascertained the protection scope and the extent of BWE Company’s three patents. Meanwhile, the litigation team conducted invalidity search and prior art search on the three patents and managed to acquire the references, which could undermine the validity of the patents involved.

Practice trial, similar to moot court practice, is an essential procedure when dealing with significant and complicated patent disputes. Through plenty of meticulous work, the Unitalen litigation team simulated the infringement lawsuit and invalidity oral argument successively. Thereafter, Li Hongjian, Sun Changlong, Kong Fanwen as well as the patent agent, Wu Shuchen, represented the Smarter Group in the court and participated in the invalidity procedure. All their efforts contributed to a satisfactory result: The plaintiff withdrew the lawsuit in one of the cases, and the claims in another case were dismissed by the court. The patents involved were declared invalid by Patent Reexamination Board. This case is a good example of how the Unitalen litigation team handles patent litigations started by multinational companies.

Model cases direct the trial trend.

“The reason we are capable of leading this trial trend is that we have a better understanding of the overall trend of IP protection. One can be aware of some trends beforehand, which are attributable to the clients one represented, as well as our accumulated experience. By following this trend and combining it with the parties’ demands can one obtain good results,” Li Yongbo continued. Moreover, a lawyer may express his opinions through one individual case and persuade the judge to adopt the views. Then to some extent, those views are able to promote the overall IP protection process and even cause some rules to be amended.

On October 22nd 2013, the Supreme People’s Court released 8 typical IPR cases. The Unitalen litigation team represented one of those 8 cases, the case of Ashland Licensing and Intellectual Property Limited, Beijing Angel Chemical Technology Co., Ltd. suing Beijing Ruishibang, Suzhou Ripu industrial additives Co., individual Weixing Guang, etc. That suit was for patent and trade secrets infringements on manufacturing methods and products of water package of water type polymer dispersion.

IPR cases related to patents and trade secrets of chemical manufacturing methods are uniquely complex and non intuitive, which makes obtaining evidence of infringement difficult. Thus, its prosecution is considerably difficult for the lawyers. After careful, layer-by-layer case analysis, the Unitalen litigation team developed some sound litigation strategies. Additionally, the Unitalen litigation team acquired substantial evidence by notarization statements from identified, domestic and overseas professionals and institutions. This along with the court’s pretrial evidence preservation and other work, laid a good foundation for smooth progress in the case.

According to Li Yongbo, the pretrial evidence preservation in patent cases is one of the main improvements recently added to the revision of China’s Patent Law. When attempting to preserve pretrial evidence in this kind of case in the past, two aspects made it difficult in process patent infringement cases: on one hand, it was not easy to get the actual evidence of the defendant violating the techniques in the process of manufacturing. On the other hand, it was very easy to hide or destroy the financial account books and the records of manufacturing operation process of the infringing enterprises. But in this case, the application for pretrial evidence preservation was finally accepted by Suzhou Intermediate People’s Court due to the full preparation of evidence 3-4/2014 China IP 19 the litigation, obtaining notarized statements regarding the infringing products which were selected and tested by independent, domestic and overseas laboratories. In the meantime, the plaintiff had also filed a related lawsuit for infringing trade secrets along with the patent infringing lawsuit.

After numerous court hearings and based on the facts established, on January 18th 2012 the two parties arrived at an agreed settlement: The defendants committed to respect the IPR of Ashland, promised not to use the patents and trade secrets of Ashland, as well as to pay damages of 22 million yuan to Ashland. To date that compensation amount is the highest damages ever paid to a foreign company in a Chinese IPR lawsuit.

“This victory is not only owed to the clients’ determination to protect their rights and the litigation experience of the lawyers, but also shows the benefits from the constant reinforcement of IPR protection by China’s judiciary,” Li Yongbo concluded.

Corporate management ensures efficient operation.

Every year there are over 200 cases presented by the Unitalen with a win rate of up to 86%. Moreover, in recent years, the lawsuits represented by the Unitalen have been selected as one of the 10 model IPR cases issued by the Supreme People’s Court.

“Under our framework of corporate management, plus the popularity and influence of Unitalen in the field of IP litigation, it is not necessary for our lawyers to spend any effort looking for clients and cases,” Li Yongbo, the principal of litigation team, continued to explain. “Generally, finding clients and cases is a great burden for lawyers. But Unitalen lawyers just need to devote their attention to our clients and cases. Furthermore, the income of our lawyers is not directly connected with the cases. We have a more scientific and reasonable way of distribution in order to ensure a stable income for our lawyers. Thus, we can make a virtuous growth for the lawyers’ income and maintain a harmonious work atmosphere and office.”

In addition, it is significant to let the top managers involve in the cases to acquire a satisfactory result. The company has the ability to redeploy their specialized IP resources from one case to another, which gives them an added advantage in protecting their clients’ interests.

The Unitalen litigation team mainly represents plaintiffs. “On one hand, it shows that the Unitalen litigation team cooperates closely with their clients for IPR protection,” Zhang Yazhou explained further, “On the other hand, even if the client is in a very passive position, the Unitalen litigation team is good at gaining the initiative. Unitalen is one of the earliest law firms presenting lawsuits enforcing the non-infringement of the exclusive use of a registered trademark. JAC Motors Co. Ltd. v. Guangzhou Hongtaiyang Company in 2011, which was represented by Unitalen, has also been listed in the 10 model IPR cases by the Supreme People’s Court that year. All of this is consistent with Unitalen’s enterprise culture of ‘figure it out’ and ‘take the initiative’.”

(Translated by Stella Yang)

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