In China, a key principle of judicial adjudication is the focus on being "fact-based and law-based," which requires that all facts be supported by evidence. As a result, the saying "evidence is king" carries significant importance in legal proceedings. However, unlike the United States, China does not have a discovery system, and under the principle that "whoever asserts the claim bears the burden of proof," plaintiffs often find themselves with a heavier responsibility to substantiate their claims.
In cases of IP infringement, plaintiffs are generally expected to provide three types of evidence. The first type is aimed at establishing the ownership, status, and scope of the rights being claimed. The second type seeks to demonstrate the alleged infringement, while the third type offers the factual basis for holding the opposing party liable for tort, including the calculation of damages.
For patent infringement cases, collecting the first type of evidence is usually straightforward. The second type of evidence can vary widely depending on the technology associated with the patent. In particular, cases involving process patents, large-scale equipment, and B2B product patents may present challenges in obtaining the actual production methods or allegedly infringing products from the accused infringer, making the proof of infringement a significant obstacle in enforcing rights.
We will explore strategies for presenting the second and third types of evidence in patent infringement litigation and will introduce approaches to address the challenges of evidence presentation in judicial practice, supported by relevant case examples.
Proof of Infringement
According to Article 11 of the Patent Law, once a patent for an invention or utility model is granted, no individual or entity may utilize the patent without the patentee's consent, unless otherwise specified in the law. This includes activities such as manufacturing, using, offering for sale, selling, or importing the patented product, as well as employing the patented process or utilizing, offering for sale, selling, or importing products directly derived from the patented process for commercial purposes.
Similarly, once a design patent is granted, no individual or entity may exploit the patent without the patentee's permission, which encompasses manufacturing, offering for sale, selling, or importing products protected by the design patent for business purposes.
To establish proof of infringement, it is necessary to demonstrate that the alleged infringer has engaged in the aforementioned activities. The following methods can be employed to gather evidence:
Notarized Purchase of the Suspected Infringing Product
A notarized purchase involves acquiring the allegedly infringing product in the presence of a notary public. This method is particularly important due to the frequent occurrence of evidence tampering in practice. In judicial proceedings, the scrutiny of key evidence is quite rigorous. If the purchase is not notarized and the opposing party disputes the production and sale of the product, the evidence may be deemed inadmissible. Therefore, obtaining a notarized purchase of the allegedly infringing products is considered one of the most effective and reliable means of proving infringement.
B2B Products Notarized Purchase
Notarizing the purchase of goods available in the public market is generally straightforward. However, the process becomes significantly more complex when it comes to B2B products, particularly in specialized fields where the sales channels are more fixed. That said, this complexity does not render the process impossible.
To facilitate the notarization of such purchases, we recommend conducting thorough preparatory work in advance. Engaging a professional investigator to examine the business operations of the target company and the specific product is essential. This investigation can help identify potential avenues for contacting the target company to explore purchasing options.
Importance of Thorough Investigation before Notarization
In our experience, there have been instances where products initially seemed impossible to acquire through notarization. For example, in a recent case involving an invention patent infringement dispute, the product in question was a type of packaging paper sold directly to a parts manufacturer for electrical products. This packaging paper was used for transporting parts, but it was discarded before reaching the end market, making it challenging to purchase. However, after conducting a visit and investigation, we discovered that the packaging paper manufacturer had an agent dealer who sold a limited number of sample packaging papers. Ultimately, we were able to successfully purchase the target product through this distributor. This experience underscores the importance of thorough investigation and creative problem-solving in navigating the complexities of notarizing B2B product purchases.
The notarized purchase of goods that are allegedly infringing serves as a strong piece of evidence in demonstrating the occurrence of the infringement. This purchasing process can effectively showcase the seller's sales activities. Additionally, if the purchased item displays the manufacturer's name, address, trademark, or other identifying information on the product or its packaging, it can substantiate both the production and sales actions of the manufacturer.
In practice, some manufacturers may deny responsibility for the allegedly infringing products, asserting that they are counterfeit. However, such claims may not hold up without sufficient evidence to support them. Therefore, if a product bearing the manufacturer's logo is purchased and notarized, it can be established that the alleged infringer engaged in production or sales activities. Furthermore, the purchased item can be utilized for comparison in infringement assessments, thereby facilitating the primary proof of infringement.
When the purchased products lack packaging
In certain infringement cases, particularly those involving B2B transactions or components, a common challenge arises when the purchased products lack packaging or labeling, making it difficult to identify the manufacturer. In such instances, additional evidence is necessary.
For example, in a recent invention patent infringement case handled by our firm, the alleged infringing item was a component of a larger product. We notarized the purchase of the complete product that included the component; however, due to the small size of the parts, there was no detailed manufacturer information available—only a four-letter abbreviation of the name. We confirmed that this abbreviation was not registered as a trademark.
To address this, we gathered industrial and commercial registration documents for the target manufacturing company, along with external business promotional materials, to demonstrate that the first letter of the English name used by the target company corresponded to the abbreviation. Additionally, we took photographs of the target company's factory, in the presence of a notary public, to show that the abbreviation was displayed on the factory buildings.
With this evidence, the court accepted our argument and determined that the parts and components in the products we obtained were indeed produced by the target company, confirming their involvement in the production of the allegedly infringing items.
When purchased product lack identifying markings
When a purchased product lacks any identifying markings, it can be challenging to gather evidence regarding the producer, and even the right holder may be unaware of the actual manufacturer. In such situations, it is beneficial to consider the seller's business scope, production capacity, and promotional practices. If the seller's business activities include production and they market themselves as having manufacturing capabilities, yet fail to provide information about the product's source, it may be reasonable to conclude that the seller is indeed the producer.
For instance, we represented the company in several design infringement lawsuits concerning counterfeit beauty rollers. In these cases, the infringing products we acquired lacked any producer markings. We successfully argued that the seller was the manufacturer by presenting evidence such as the seller's industrial and commercial registration details, promotional materials, and brochures, ultimately receiving the court's endorsement. The defendant was ordered to cease production and sales of the infringing products and to pay substantial compensation.
Conversely, if the seller's business scope does not encompass production and their business model clearly identifies them as a distributor, it becomes more challenging to assert that they are engaged in manufacturing. In such instances, I recommend pursuing legal action to compel the seller to disclose the product's source and any information regarding the manufacturer. This approach can help trace the producer's details and mitigate potential liability for damages.
Tips for Notarial Purchases
In practice, the purchasing process is typically divided into several steps, including contract signing, ordering, payment, and receipt of goods. For everyday items, these steps often occur almost simultaneously, making it easier to notarize the entire process. However, in the case of B2B product purchases, it is uncommon for the entire process to be completed at once. Therefore, it is essential to ensure that each step aligns as closely as possible to create a comprehensive chain of evidence.
As previously mentioned, it is advisable to engage a professional investigator during the initial stages of a notarial purchase to prepare adequately. Additionally, the involvement of a lawyer is crucial when executing a notarial purchase. We encountered instances where parties have hired an investigation company to facilitate the purchase and subsequently provided us with the notarial deed. However, we have observed that many links referenced in the notarial deed were incomplete, necessitating additional validation, and in some cases, the evidence could not be linked to the intended company, rendering it unusable.
To avoid such issues, we recommend that the lawyer overseeing the process confirm the overall strategy for the notarial purchase and review the contents of the notarial deed in advance.
As the E-business continues to gain popularity, the promotion and sale of products online have become increasingly prevalent. This trend has led to the need for effective methods of collecting evidence related to potential infringement, including the notarization of promotional materials and sales pages. Online notarization has emerged as a common and efficient way to gather such evidence.
TBD