Haworth & Lexon IP Cases Report (13)

Haworth & Lexon IP Law Newsletter
No.7, 2003 (Total:No.13) August 5th, 2003
Edited by Haworth & Lexon

“Haworth & Lexon Intellectual Property Law Newsletter” aims at introducing new cases and legal tendency in IP fields. All the comments do not mean the legal opinion of our firm and the firm does not have any legal liability for such comment. If you require any legal advice, we are willing to offer you considerate service. You can write E-mail to hl@hllawyers.com. If you have any interests and suggestions, or have any interests on some topics listed in this law newsletter, please contact with us.


★ Hengshen & Hengsheng Come to Compromise on the Trademark Infringement; Hengshen HangzhouBecomes Hengsheng’s Next Target. 
★Transference of Patent would not Eliminate Prior Right Owner’s Right of Bringing-up-Litigation for Patent Infringement which Happens Before the Transference.
★Pre-installation Software as a Present on Computer on sale would be regarded as Infringement of Copyright.
★Publish House should Bear Legal Responsibility while Publishing Piratical Articles on Fault.
★Internal Café of Hotel Using Trademark of others as its name; the Hotel bears the responsibility.

Hengshen & Hengsheng Come to Compromise on the Trademark Infringement; Hengshen Hangzhou Becomes Hengsheng’s Next Target.

The computer trademark infringement case Hengshen Vs. Hengsheng has come to compromise under the intermediation of Beijing Supreme Court.

In Nov, 2001, Beijing Far East Hengsheng Electronic Computer Group which registered the trademark “Hengsheng” first brought the case for trademark infringement against Beijing Hengshen Technology Development Co. & Beijing Jin Hengshen Technology Development Co. for the reason that the same sound of Hengshen’s trademark with “Hengsheng”s would cause confusion for consumers. The First Beijing Intermediate Court supported the claim of plaintiff, and judged that the defendant should pay RMB 9,200,000 for the plaintiff as compensation. The defendant appealed to Beijing Supreme People’s Court.

Under the intermediation of Beijing Supreme People’s Court, two parties came to an Intermediation Agreement in which the two parties promised that the disputations aroused by trademark “Hengshen”&”Hengsheng” had been settled and each party would not bring up litigation against each other on the matter any more, and they also made promised that Hengshen Beijing would pay considerable attention to trademark “Hengsheng” while Hengsheng Beijing wouldn’t put forward any objection for the validity of trademark “Hengshen” any more and would also repeal the application for announcement of “impropriety registration ” to TRAB in one month. Hengshen Beijing would pay Hengsheng a compensation, and make active measures to avoid mislead of consumers toward the producers of the computers in stressing the special meaning of trademark “ASCEND Hengshen” & “Hengsheng” by changing the style of characters, adding colors or phrases in advertisement and commodity packings.

The first trial of Hengsheng Vs. Hengshen once has brought great influence in public. And now, Hengsheng has brought another trademark infringement case for the same reason toward Hengshen Hangzhou Electronic Stock Company on Apr, 25,2003, which suspended a more than 17,000,000 IPO of Hengshen Hangzhou. How the intermediation between Hengsheng & Hengshen would influence this case? We would keep attention

Transference of Patent would not Eliminate Prior Right Owner’s Right of Bringing-up-Litigation for Patent Infringement which Happens Before the Transference.

Guiyang Automobile & South Huitong Stock Company sued Zhejiang Hengfeng Palm Cushion Factory for patent infringement. The Intermediate Court of Guiyang made judgment on this case on May,20,2003, in which support the plaintiff’s claim while asked a stop of infringement and apologize of defendant, and the defendant should also pay the plaintiff RMB 630,193.56 Yuan as compensation.

The plaintiff owned the patent of “Palm Fiber Elastic Material and its production method”, and the patent right was transferred to South Huitong Stock Company, the transference authorized by General IP Bureau. The defendant, who was founded in Apr 1996, mainly produced and sold Palm Fiber Cushion, and these behaviors were believed infringing plaintiffs’ patent right. The plaintiffs’ request of stop infringement was refused by defendant twice; the defendant didn’t stop its production in the reason that it was granted the patent of producing method though its patent right was declared invalidity. The plaintiffs brought the case for the protection of their own rights:

The focus of this case are mainly listed as follows:
1. Can the prior patent right owner bring case on the patent infringement
which happened before the transference?
Guiyang Supreme Court believes that, after the transference of patent right, the prior patent right owner only lose the right of claim for stop infringement while still has the right of claim for apologize and compensation for infringement happened before transference as well as became the co plaintiffs, no matter whether these right was still in litigation time confinement and their claims would be supported by the Court.

2. Whether the defendant’s behavior constitutes patent infringement?
The Court believes that whether the characteristic of defendant’s product and producing method was the same as the plaintiffs’ was a matter of technique and should be judged by authentication institution, and the two parties asked Chinese Intellectual Property Seminar for authentication. The authentication that the characters of defendant’s product and producing method were all covered by plaintiffs’ patent right explanation, and didn’t have any obvious progress or creative development in technique. Thus the fact that defendant adopted equivalent method to put into practice of plaintiffs’ patent, which requires no creative work of the technicians of this domain, has infringed the plaintiffs’ rights.

Pre-installation Software as a Present on Computer on sale would be regarded as Infringement of Copyright.

Adobe Systems Inc. sued Nianhua Computer Pic&Literal Technology Co.Ltd for software infringement and brought the case to Shanghai First Intermediate People’s Court, because the defendant pre-installed and donated several software with its computer on sale for free, and these software were owned by the plaintiff such as “Adobe Typeset Expert 6.5(Chinese Version)”, “Adobe Electronic Photo gallery 5.0”, “Adobe Drafts Master 8.0” and etc. The plaintiff believed that defendant’s behavior was illegal, and asked for compensation.

Shanghai First Intermediate Court made rule that the defendant should stop its infringement and pay the plaintiff RMB150,000 Yuan as compensation. The defendant appealed, and now Shanghai Supreme Court made final decision on this case.

The focus of this case is that whether defendant has infringed the plaintiff’s rights ;the amount of compensation is also a focus deserves our attention.

Shanghai Supreme Court believes that the purpose of defendant’s free pre-installation was to improve the sale of its product in order to gain more profit. Copy and pre-installation plaintiff’s software in its computers on sale without plaintiff’s permission, had infringed plaintiff’s copyright, and defendant should burden the obligation of stop infringement, apologize, and compensation. Because the actual loss of plaintiff and illegal incomes of defendant can not be calculated clearly, the Supreme Court affirmed the first trial decision according to the defendant’s objective fault, infringement plot and other factors.

Publish House should Bear Legal Responsibility while Publishing Piratical Articles on Fault.

Plaintiff XU Liqing, the author of “The Reason of Sows’ Post Partum Un-Eat” which was published on the 7th journal ” Science & Fortune”; sued Internal-Mongolia Herd Journal Newsroom of “Science & Fortune” Edit Organization. Ji’nan Intermediate People’s Court ruled on the case, and made decision that defendant should pay RMB5000 Yuan as compensation to plaintiff. The Supreme Court affirmed decision after defendant’s appeal.

The question whether the Newsroom should bear legal responsibility for publishing piratical Articles on Fault became the focus of this case.

In this case, the Newsroom didn’t publish the piratical articles deliberately, and if it can provide evidence to prove that they have paid necessary attention and this attention was also believed to be appropriate by the Court, the Newsroom only should burden the liability of stop infringement, apologize and refund infringement incomes, dispensed with the liability of compensation. Therefore, if the Newsroom didn’t collude with the piratical person, the Newsroom only should burden the liability corresponding with its fault, and the main liability should be assumed by the piratical person.

The Newsroom hadn’t present at the court in the first trial, which means they had abandoned the right of deraignment, thus the first trial court’s decision that they should apologize and compensate the plaintiff for RMB 5,000 Yuan was quite right. During the final decision, defendant also didn’t provide evidence to prove that they had paid necessary attention, thus, the final trial affirmed the decision.

Internal Café of Hotel Using Trademark of others as its name, the Hotel Bear the responsibility of Infringement

Plaintiff Fuchun Café of Yangzhou Fuchun Bite and Sup Co.Ltd sued the Second Rest House of Sucheng People’s Government of Suqian for trademark infringement. Suqian Intermediate Court of Jiangshu ruled on this case.

The focus of this case were: firstly, whether the rest room should assume liability for trademark infringement brought by the café, which belongs to it but was, contracted to be managed by others; secondly, whether the name of internal café in Rest House would cause trademark infringement.

The Court believe that the internal café, as a part of the Second Rest House of Sucheng, was not an independent legal person and hadn’t got Business License either, thus defendant should bear the liability, and the compensation paid by defendant could be claimed to the mananger of internal café.

Besides, the plaintiff owns the trademark of “Fuchun”, and this trademark has been used as the name of defendant’s internal café. As the defendant operates the same items as the plaintiff, while the plaintiff’s trademark was quite famous in this Province, defendant’s use of “Fuchun” would cause confusion in consumers, and may even believe that these two kind of commodities and services were all provided by the plaintiff. Therefore, the defendant has infringed the plaintiff’s right. The trademark “Fuchun” didn’t show either the quality of commodity or main materials they provide, and also didn’t contain place name. Thus, the Court ruled on the defendant that they should stop infringement, make apologize and also pay RMB 20000Yuan as compensation.

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