China’s Supreme People’s Court (Supreme Court) promulgated the Opinion on Hearing Intellectual Property Cases During the Current Economic Situation (Opinion) on 21 April 2009. In brief, the Supreme Court has signalled to the courts that a plaintiff’s request for a preliminary injunction (PI) in a case concerning intellectual property should be scrutinized strictly. The following is a summary of important opinions contained within the Opinion:
- A PI should be granted only in cases wherein the facts are basically clear and it is relatively easy to determine whether the infringement has occurred.
- In a determination as to whether “irreparable harm” would be caused without the granting of a PI, serious consideration should be given to whether monetary damages would be sufficient to make the plaintiff whole and whether a PI can be reasonably expected to be enforceable.
- Given that a PI would likely have a significant impact upon both the business operations and market share of a defendant, the Supreme Court opines that the courts should not allow plaintiffs to unduly harm defendants by granting PIs liberally. Moreover, the courts should take into account whether the issuance of a PI would cause the defendant to suffer serious economic injury.
- In patent-infringement cases, especially those concerning invention and utility models, it is not appropriate to grant a PI where a defendant’s conduct does not constitute literal infringement and further technical investigation (including a comparison of the plaintiff’s patent with the alleged infringing product of the defendant) is necessary. Where the defendant has separately initiated non-infringement litigation, or has initiated patent invalidation proceedings over the claimed patent, the courts should also be cautious in granting a PI to said defendant.
- The courts should provide sufficient remedy to an aggrieved party that has suffered severe harm as a result of a PI that was “maliciously” requested in order to obstruct the introduction of the aggrieved party’s product to market.
Despite the above rules, the Supreme Court clearly indicates in the Opinion that the courts should continue to actively grant PIs in copyright and trade mark cases involving counterfeiters and other blatant infringers. Moreover, with respect to the defendant’s answer denying a PI motion, generally only circumstances involving the public health or other “material social interests” (e.g., environmental concerns) should be considered by the court when refusing to grant a PI.
Simply put, in the current economic climate, it would appear that the Supreme Court has indicated that courts should begin to examine more closely any request for a PI—particularly in patent infringement cases—and, at minimum, take into consideration the harm that might follow as a result of granting such request.