Civil Procedure of Patent Litigation with the Dual Aims of Fairness and Efficiency

Zhu Li,[Patent]

 

Zhu Li

Presiding Judge of Intellectual Property Court of Supreme People’s Court

 

Problems in practice require reforms of the civil procedure system. However, in many cases, laws are not clearly defined therefore courts can dominate the design and operation of many procedure rules. Patent litigation will become more efficient in China, if stage control of litigation, mandatory evidence discovery and instant judgment of litigation issues can be implemented.

 

All litigation including patent litigation in all countries should achieve the dual aims of fairness and efficiency. In the process of achieving these goals, there are sometimes not many contradictions between fairness and efficiency, but sometimes there are some. The complexity of patent technologies makes the determination of facts a more time-consuming process. How can patent proceedings be "fast and good"? How can we improve competitiveness and attractiveness of China's patent litigation system? In the current situation, there are three phenomena worthy of our consideration.

First, control the litigation proceedings in stages. Take Ford as an example, it created a modern management system, which divided each production line into different stages with highly standardized operating procedures to check every part and leave qualified ones to the next stage.

Second, mandatory evidence discovery.

Third, instant judgment of disputing issues. With the continuous discovery of the parties' evidence, some of the litigation issues may meet the requirements of judgment in some cases. Under such a circumstance, an immediate judgment can be given to conclude the case in time.

 

Control the litigation proceedings in stages

There are several steps to control the litigation proceedings in stages.

First, divide the proceedings into several separate stages; every stage is subject to strict management and control. This is not only a task of the court, but the parties and lawyers should also coordinate with the court to control the proceedings. When specific issues meet certain conditions, judgment will be given immediately.

 

1. Civil procedure of patent litigation in the US

There are several points worthy of our consideration: first, the parties can negotiate with the court for the schedule; second, the mandatory pleading procedure requires the court to identify issues as soon as possible; third, evidence discovery is a responsibility of the parties that have nothing to do with the burden of proof to disclose the evidences, which will ensure that the court will ascertain the facts; fourth, Markman hearing can immediately resolve disputes concerning interpretation of claims; fifth, different motions can be filed at different stages.

 

2.Civil procedure of patent litigation in civil law countries

First, the court negotiates with the parties regarding schedule of the case.

Second, pleading procedures are becoming ever stricter. For example, the amendment to the Japanese Civil Procedure Law in 2001 introduced the Inquiry system, requiring the other party to make a written response within a certain period of time to the matters necessary for claim preparation or proof, and the other party has the duty of answering honestly. To a certain extent, this is a mandatory pleading. Both Germany and France require a written pleading, which is of great importance. Almost all litigation are based on written materials such as prosecution and pleading, and trial mainly serves as an opportunity for judges to know whether they understand written materials submitted by the parties and whether the parties understand the request or pleading.

Third, a strict schedule is necessary. In the Munich courts in Germany, for example, no extensions are allowed during the pleading period, except for good causes, and extensions can only be allowed once for up to seven days. The other party does not receive an extension automatically.

Fourth, expert opinions are rarely needed. Experts are only needed under certain circumstances, and the court will designate an expert on which the parties can give an opinion. Once an expert is appointed, the expert needs to go to the court and answer the questions of the parties in court. This expert cannot add comments in written forms after the trial.

Fifth, the judge promptly discloses his/her own judgment, because this plays an important role: first, disclosing the judge's understanding of this issue allows the parties to express their own opinions on the issues of concern during the trial; second, the judge's opinions can help the parties assess their chances of winning. Such a timely disclosure of the judge's opinion makes subsequent procedures targeted, and makes it possible for the case to be mediated and closed.

In Germany, South Korea and other countries, judges can explain to the parties their temporary opinions on issues as interpretation of claims and the possibility of winning in the first hearing.

 

Mandatory evidence disclosure

Litigation in all countries, whether practicing common law or civil law, emphasizes bona fide litigation and takes truth discovery as the primary goal. It is the basic standard of modern litigation to stress the truth obligation and coordination duty. In mandatory discovery, the production of evidence and the burden of proof are completely separated. That is to say, as long as there are relevant laws, the parties have an obligation of evidence discovery, whether or not there is a burden of proof on them. Only then can we trace objective facts more accurately. If the task of ascertaining the truth is left to the parties completely, especially the plaintiff, the truth cannot be discovered in many cases.

In the field of patent law, countries practicing the civil law system have not established an evidence discovery system, but are trying a limited one. Japan, France, and Germany have the system of the order of writ, in which the respondents cannot refuse to offer the written document when the document is used in the lawsuit, the applicant requires to submit or read this document, and this document is written for the benefit of the evidence provider or for the legal relationship between the evidence provider and the holder of the document.

 

1.Infringing product seizure and evidence collection system (France)

In France, in order to prove infringement, any person entitled to file a lawsuit can file an application for seizure to a court with jurisdiction. After the court makes a ruling, the judge will send a bailiff, with the assistance of the expert appointed by the plaintiff, to record in detail the infringement, extract samples, and seize suspected infringing products and relevant documents or the raw materials and tools for the infringement. The bailiff must record in detail what he/she sees and what the expert tells him/her. Evidence collected by the bailiff will be given to the applicant, who will decide how to use it.

 

2.Information disclosure obligation (Germany)

In Germany, the IP owners can, through prosecution, force the other party to provide evidence. The latest example is Japan's revision of its patent law, which put in place a system of evidence collection order. It requires the other party to respond, submit bills, present documents, etc., and request the court to order the other party to provide information and tolerate the search and inspection of products or places when the other party seriously violates laws. This is similar to the French system of infringing product seizure and evidence collection system mentioned above.

 

3.Order of evidence collection (Japan)

The newly revised Japanese Patent Law stipulates that the plaintiff of the patent infringement lawsuit can request the court to collect evidence. If the requirements of order are met, the court that handles the infringement dispute will issue an evidence collection order; the designated neutral and impartial expert will review documents managed by the defendant or carry out on-site evidence collection of the defendant's equipment and facilities, and submit a report to the court.

Evidence collection order must meet three requirements, namely necessity, complementarity and rationality. Necessity means that the object of evidence collection should be necessary for discovering infringement evidence; complementarity means that plaintiffs applying for evidence collection should explain the reasons why relevant evidence cannot be collected by themselves or through other methods; and rationality is to avoid the excessive burden posed on the accused infringer. When receiving an application, the court should take into consideration the time needed for evidence collection, the burden posed on the accused infringer, other factors and the expert recusal system.

 

4.Specific answer obligation and inspection tolerance obligation (South Korea and Chinese Taiwan)

The patent laws of South Korea and Chinese Taiwan have provided specific pleading obligation and inspection tolerance obligation. When the plaintiff sues and satisfies evidence requirements, the defendant needs to actively file an answer and provide implementation methods, if the defendant denies the implementation of patent infringement alleged by the plaintiff. If the court accepts that the defendant has reasonable grounds for not providing specific implementation methods, it may conduct an on-site inspection and limit relevant personnel involved in the inspection.

In conclusion, countries practicing the civil law system have, to some extent, introduced a limited evidence discovery system.

 

Instant judgment of litigation issues

Stage control and fact investigation have made certain litigation issues meet judgment requirements. Then, the court can, in accordance with the request of the parties, make a timely decision on certain issues and allow the parties to file appeals on some issues.

China is going to witness a widespread application of intermediate and partial judgment. Germany has a system of partial judgment of infringement and timely verbal disclosure of the judge's judgment. China is also trying to introduce partial judgment on infringement. In my opinion, this will become normalized in China with the increasing role played by provisions of the IP law on submission of infringement account and information provision obligation. If infringement judgment is relatively easy and calculation is relatively difficult, courts may focus more on partial judgment on infringement in the future. In addition, it is also important to coordinate partial judgment of infringement and temporary injunction.

Problems in practice require reforms of the civil procedure system. However, in many cases, laws are not clearly defined, therefore courts can dominate the design and operation of many procedure rules. Patent litigation will become more efficient in China, if stage control of litigation, mandatory evidence discovery and instant judgment of litigation issues can be implemented.

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