[Case Summary]

In July 2012, patentee, Jianjun Du, filed a petition before Guangzhou Municipal Intellectual Property Office claiming that Guangzhou Kehan Electronics Co. (“Kehan”) infringed upon his invention patent No. 200710076841.0 (the ’841 patent). After an oral hearing in September, the Office made a decision in December ordering Guangzhou Kehan to stop selling the infringing products. Not pleased with the decision, Kehan sued the Office before Guangzhou Intermediate Court, which opined that the decision was flawed because it found that the ’841 patent was transferred to a company owned by Jianjun Du in August 2012 and the transfer was published by the State Intellectual Property Office in October 2012. As a result of negotiation between the Office and the plaintiff, the Office withdrew its decision and the plaintiff withdrew its complaint to end the suit.

[Comments of Lifang]

It often happens that the patent is transferred while its owner plans to enforce or enforces the patent right, especially from an individual patentee to his company or between two affiliated companies. However, many previous patent owners have not fully evaluated potential effects caused by such a transfer, so neglect any negative or even deadly consequence it may bring about, such as in the above-mentioned suit. It is necessary to evaluate the consequences likely caused by the transfer and determine appropriate suit strategies the previous and current patent owners can take in every legal proceeding.

1. If a patent is transferred in the course between evidence collection and filing the complaint, it is advised that both transferor and transferee jointly file the complaint. Thus, an eligible plaintiff is remained during the trial and execution proceedings and entitled claims for damages and stopping infringement activities immediately.

2. If a patent is transferred during the trial or appellate proceeding, either court can support the plaintiff’s claim for damages, but not its claim for immediately. stopping infringement activities The reason lies in that the plaintiff，i.e. the transferor， no longer owns the patent and thus loses the right to claim for stopping infringement. 3. If a patent is transferred after the court’s decision comes into force for execution, the order to stop infringement shall not be executed for the same reason. On the other hand, as most courts weight on payment of damages, and in practice it is hard to have the infringement activities stopped or have infringing products destroyed, the transfer occurring at this proceeding would not affect the actual execution much.

(By Yanxi Liu, Lei Min and Sili Wu of Lifang & Partners)