China’s top 20 patent cases of 2020: OPPO v. Sharp

China IP,[Patent]

 

Docket number of the case in the first instance: No. 689 (Part 1), first instance (初), civil case (民), (2020) Shenzhen Intermediate People’s Court (粤03) 
 
[Prefatory Syllabus]
It has certain particularity to prohibit the act preservation measures of the defendant concerning some acts. Where the defendant refuses to comply with the obligation of omission as set out in the ruling of act preservation made by the people’s court, and illegally commits the acts of changing relevant original state. As the defendant’ intentionally committed unlawful acts continuously violate the ruling of act preservation and change the relevant original state, it shall be deemed that the defendant is committing illegal acts all the time on a daily basis. Accordingly, a daily fine, cumulative on a daily basis, may be imposed as the case may be.
 
[Basic Facts]
Plaintiff: Guangdong OPPO Mobile Telecommunications Co., Ltd., and Shenzhen Branch of Guangdong OPPO Mobile Telecommunications Co., Ltd. (Collectively, “OPPO Companies”)
Defendant: Sharp Corporation and ScienBiziP Japan
 
OPPO Companies negotiated with Sharp Corporation concerning SEP licensing at the request of the latter. As the negotiations, Sharp Corporation filed an extraterritorial patent infringement lawsuit against OPPO Companies. Contending Sharp Corporation who filed a lawsuit and requested an injunction over the patents covered by negotiations is in breach of FRAND obligations, OPPO Companies filed a lawsuit with the Intermediate People’s Court of Shenzhen, Guangdong Province, requesting the court to rule on the global rate at which OPPO Companies are to be licensed regarding relevant SEPs owned by Sharp Corporation. Moreover, considering that Sharp Corporation could use an “extraterritorial injunction” to intimidate them into negotiations, OPPO Companies filed an application for act preservation.
 
The first-instance court ruled that before the final judgment of this case, Sharp Corporation shall not file a new lawsuit or judicial injunction against OPPO Companies in other countries or regions with respect to the patents involved in this case. Any violation of this will be subject to a fine of RMB 1 million per day. Seven hours after the first-instance court issued the “anti-suit injunction”, the First District Court of Munich, Germany, issued an “anti-anti-suit injunction” to OPPO Companies, ordering them to apply to the Chinese court for withdrawing the anti-suit injunction. The first-instance court conducted a courtroom investigation on the “anti-suit injunction” and “anti-anti-suit injunction”, fixing the facts and evidence of breach of act preservation adjudication by Sharp Corporation and clarifying serious legal consequences of violating the judgment of the Chinese court. In the end, Sharp Corporation unconditionally withdrew the petition for reconsideration in the case and the “anti-anti-suit injunction” applied to the German court, and stated that it would fully respect and strictly abide by the effective ruling of the Chinese court.
 
[Typical Significance]
In this case, the issuance of a global “anti-suit injunction” and the successful resolution of “anti-anti-suit injunction” demonstrates the unwavering attitude of Chinese judicial authorities, provides a strong judicial guarantee for enterprises to compete on a level playing field in the international market, and is of great significance for China to transform from “a follower” to “a leader of international intellectual property rules”.

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