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Beijing High People’s Court Guidelines for Adjudication of Network-related IP Cases (2016.4.13)

Beijing High People’s Court Guidelines for Adjudication of Network-related IP Cases (2016.4.13)

Section I: Network-related Copyright

1. The plaintiff who asserts that the defendant has conducted, individually or jointly with others, an act of providing works, performances, or audio or video recordings at issue shall bear the burden of proof.

Where the plaintiff provides evidence proving that the works, performances, or audio or video recordings at issue can be played, downloaded, or obtained by other means via the defendant’s website, the defendant, who asserts nonetheless that he did not conduct the alleged act, shall bear the burden of proof accordingly.

2. The plaintiff may provide evidence identifying the contents of the defendant’s website by methods such as notarization, but should ensure the completeness of both the evidence collection steps and related web pages.

3. The nature of the act conducted by the network service provider may be determined by making an overall judgment by way of inspecting the scene, taking into consideration of the evidence provided by both the plaintiff and the defendant, following the provisions of law and applying logical reasoning and empirical rules.

4. Where the plaintiff, at the time of filing a lawsuit, fails to clarify his claim as to whether the defendant has conducted an act of communication through information network, or an act of abetting or assisting others to communicate through information network, and still leaves his claim ambiguous before the end of the court debate, a comprehensive examination on the nature of the act conducted by the defendant shall be made based on the opinion presented by both the plaintiff and the defendant as well as the evidence on record.

5. The defendant, who asserts that he merely provides network technical services, such as information storage space, searching and linking, shall bear the burden of proof.

The defendant should provide evidence related to the provider of the works, performances, or audio or video recordings at issue, or his relationship with that provider.  Otherwise, it may be determined that the defendant provides more than network technical services.

Where the defendant provides no evidence or the evidence provided thereby is insufficient to prove that the defendant merely provides network technical services, such as information storage space, searching and linking, it may be determined that the defendant conducts the act of providing the works, performances, or audio or video recordings.

6. Where the defendant asserts that he provides information storage space, a determination may be made by taking the following factors into comprehensive consideration:
(1) the evidence provided by the defendant can prove that his website is able to provide information storage space to service recipient;
(2) the relevant contents of the defendant’s website clearly indicate he provides the information storage space to a service recipient;
(3)  the defendant can provide evidence such as user IDs of uploaders, IP addresses of registration, time of registration, IP addresses of uploading, contact information, as well as time of uploading, and the information uploaded, etc.; and
(4) other factors that can prove that the defendant provides information storage space.

7. Where the defendant can provide evidence in support of any of the following circumstances, it may be determined that the defendant provides linking services:
(1) works, performances, or audio or video recordings at issue are played on a third party website, redirected from the defendant’s website;
(2) works, performances, or audio or video recordings at issue are played on the defendant’s website, but there is sufficient evidence proving that the works, performances, or audio or video recordings at issue are stored on a third party website; and
(3) any other circumstance under which the services provided by the defendant may be determined as linking services.

8. Unauthorized act of jointly providing works, performances, or audio or video recordings at issue by way of division of labor is an act of direct infringement upon the right of communication through information network.

Where there is an intention liaison among the defendants or between the defendant and others to jointly provide works, performances, or audio or video recordings at issue, and have objectively conducted such an act accordingly for that purpose, it may be determined that the said act falls within the circumstances stipulated in the preceding paragraph.

9. Where there exists evidence, such as an agreement showing the willingness to cooperate among the defendants or between the defendant and others, or evidence on record proving that the parties are closely associated with each other in content cooperation and benefit sharing, it may be determined that there is an intention liaison among the parties to jointly provide works, performances, or audio or video recordings at issue, except that the defendant can prove that he merely provides technical services as required by the technical or business model.

10. Exemption provisions concerning network service providers shall not apply to the act of providing works, performances, or audio or video recordings at issue either individually or jointly by way of division of labor.

11. Article 36 of the Tort Liability Law is a provision relating to constitutive requirements of tort liabilities.

Rules 20, 21, 22, and 23 of Regulations on the Protection of Right of Communication through Information Network serve as the exemption provisions that exempt the network service provider from liability for damages for infringement.
 
Where the said exemption provisions are not met, Article 36 of the Tort Liability Law shall apply to determine whether the network service provider is liable for damages.

12. Plea for non-infringement made by webpage “snapshot” service provider on the grounds of searching, linking, or system caching shall not be supported.

13. Whether the contents of the source webpage of a “snapshot” constitutes an infringement is irrelevant in determining infringement resulting from an act of providing webpage “snapshot” service.

14. In determining whether an act of providing webpage “snapshot” service falls within the circumstances under which a regular use of relevant works is not affected and the right holders’ legitimate rights to the works and interests in the works are not unreasonably impaired, the following factors may be taken into comprehensive consideration:
(1) the primary purpose of providing the webpage “snapshot”;
(2) whether the plaintiff can take measures, such as notice and take down, to mitigate damages to the maximum extent;
(3) whether the plaintiff has explicitly notified the defendant to take down the webpage “snapshot”;
(4) whether the defendant still fails to take any measures timely upon knowing that his act is suspected of infringement;
(5) whether the defendant directly gains benefits from the act of providing the webpage “snapshot”; and
(6) other related factors.

15. Where the defendant offers, without authorization, online real-time broadcast, the plaintiff’s claim against the defendant for infringement according to Article 10, paragraph 1, item (17) of the Copyright Law, shall be supported.

16. The provisions in this Section shall apply to the act of infringing other’s copyright through information network using mobile terminals such as mobile phones and tablet computers.

Section II: Network-related Trademark

17. “Platform service provider” refers to an entity which provides network platform service for transaction information and transaction acts.

18. In determining whether a platform service provider shall be held liable for trademark infringement, consideration shall be given to the interests of the right holder, the platform service provider, the online seller, and the general public.

19. Generally, the platform service provider shall not be obligated to check the legitimacy of on-line transaction information or transaction acts beforehand. However, the platform service provider shall take necessary, reasonable, and appropriate measures to prevent trademark infringement, according to the nature, manners, and contents of services provided by its pertinent industry, and information management capabilities and business management capabilities generally required for the platform service provider.

20. Where the plaintiff has preliminary evidence to prove that a platform service provider provides the alleged infringing transaction information or commits a transaction act infringing his trademark, if the platform service provider can prove that the transaction information is provided or the transaction act is conducted by an online seller and the platform service provider is not at fault, the platform service provider shall not be held liable for infringement.

Where the platform service provider can provide evidence identifying the identity, contact information, network address, etc. of the online seller, it may be preliminarily determined that the alleged infringing transaction information is provided or the transaction act is conducted by the online seller.

Where the platform service provider provides no evidence or fails to prove that the alleged infringing transaction information is provided or the transaction act is conducted by an online seller, it may be determined that the platform service provider directly provides the alleged infringing transaction information or directly conducts the transaction act.

21. Where the platform service provider abets or assists the online seller to commit an act of trademark infringement in the course of providing network service, the platform service provider, together with the online seller, shall be held jointly and severally liable.

Where the platform service provider intentionally induces and encourages the online seller to commit an act of trademark infringement by means of language, technical support for recommendation and introduction, bonus point, preferential service, etc., it may be determined that the platform service provider commits the act of abetting the infringement of the online seller .

Where the platform service provider knows that the online seller infringes other’s trademark by using the network services, but does not take necessary measures such as removing, blocking, and disconnecting the website link, or still provides assistance by way of technical and service support, it may be determined that his act assists in the infringement of the online seller.

22. Where the right holder notifies the platform service provider to take necessary measures to remove, block, and disconnect the link to prevent the online seller from infringing his trademark, he shall deliver to the platform service provider such notification in writing or another form provided by the platform service provider.
The contents of the notification as mentioned in the preceding paragraph should enable the platform service provider to determine the specific circumstances of the alleged infringement and to have reasons to believe that there is a high likelihood of trademark infringement.  The notification shall include the following contents:
(1) detailed information, such as name and effective contact information of the right holder;
(2) relevant information capable of accurately locating the alleged infringing contents;
(3) proof of trademark ownership and the alleged infringing facts; and
(4) declaration by the right holder guaranteeing the authenticity of the contents in the notification.

23. Where the platform service provider knows, based on the notification delivered by the right holder, that the online seller is committing an act of trademark infringement by using the network service provided by the platform service provider, the platform service provider shall timely take necessary measures such as removing, blocking, and disconnecting the website link.

Judgment on whether necessary measures are taken in a timely, reasonable and appropriate manner shall be made by taking into comprehensive consideration the factors such as the nature of network service, form and contents of the notification, circumstances of the trademark infringement, and technical conditions.

24. After taking necessary measures, the platform service provider shall, within a reasonable time period, clearly inform the online seller of the measures taken.  Where a reasonable time period has expired, and the platform service provider is at fault for causing damages to the online seller, the platform service provider shall be held liable for such damages.

25. Where the platform service provider has taken necessary measures to remove, block, and disconnect the website link owing to incorrect notification from the right holder, thereby causing damages to the online seller, the online seller has the right to request the right holder to bear the liability for damages.

26. That the platform service provider “knows” the trademark infringement committed by the online seller using network service provided by the platform service provider includes “clearly know” and “ought to know”.

The following factors may be taken into comprehensive consideration in determining that a platform service provider knows that an online seller is infringing other’s trademarks by utilizing the network service:
(1) the alleged infringing transaction information is placed on the homepage of the website, the homepage of a column or other noticeable locations;
(2) the platform service provider has taken the initiative in editing, selecting, sorting out, ranking, recommending, or revising the alleged infringing transaction information;
(3) the notification of the right holder is sufficient to enable the platform service provider to know that the alleged infringing transaction information is disseminated or the alleged infringing transaction act is committed using the network service provided by the platform service provider;
(4) the platform service provider fails to take reasonable measures accordingly against the repeated acts of infringement upon the same right committed by the same online seller;
(5) the alleged infringing transaction information contains admission of infringement by the online seller;
(6) well-known goods or services are sold or offered at an obviously unreasonable price;
(7) the platform service provider has directly gained economic benefits from the network dissemination of the alleged infringing transaction information or the alleged infringing transaction act; and
(8) other factors that enable the platform service provider to know that the alleged infringing transaction information or the transaction act has infringed other’s trademarks.

27. The platform service provider’s direct gains of benefits from the network dissemination of the alleged transaction information, or the alleged transaction act refers to the circumstances under which the platform service provider has posted advertisement for such specific transaction information, or the transaction act and withdraws corresponding proportion of benefits, or obtains economic benefits that have other direct connection with the specific transaction information or the transaction act.

Advertising fees, technical service fees, service fees and management fees which followed ordinary standard in the industry charged by a platform service provider for providing network service do not belong to the circumstances stipulated in the preceding paragraph.

28. Determination of whether goods or services provided by application software and through information network are identical with or similar to goods or services designated under other’s registered trademark should be made based on the purposes, contents, manners, and objects of the services specifically provided by the application software, and it should not be certainly determined that the former is similar to computer software goods or internet services.

Section III: Network-related Unfair Competition

29. A network-related unfair competition dispute refers to the one arising from an unfair competition act directly or indirectly committed by undertakings through information network.

30. In adjudication of the network-related unfair competition dispute, discretion shall be excised according to the law, with consideration given to the interests of undertakings, customers and the general public, for the purpose of encouraging the innovation of business models, and ensuring the market fairness and free competition.

Where the alleged act of a business operator merely infringes other’s rights explicitly specified in laws such as copyrights, trademarks and patents, the Anti-unfair Competition Law shall not be applied.

31. Where there exists between undertakings one of the following relationships that may impair the plaintiff’s legitimate rights and interests and give rise to a change in transaction opportunities and competitive advantages, a competitive relationship may be determined as having existed:
(1) the goods or services of the undertakings can be replaced with each other in direct or indirect way; and
(2) business activities of the undertakings may be overlapped, interdependent, or associated in other ways.

32. Where the defendant’s alleged unfair competition act committed through information network falls in the specific circumstances stipulated in the provisions of Chapter 2 of the Anti-unfair Competition Law, Article 2 of the aforementioned law shall not be applied.

33. In respect of network-related unfair competition disputes, publicly recognized business ethics refer to business norms and moral codes that are generally accepted by the undertakings in a specific industry, and satisfy the interests of consumers and the general public.

In determining the publicly recognized business ethics, ethical standards of “economic man” generally recognized and accepted in a specific industry shall be followed, and the legislative intent of Article 1 of the Anti-unfair Competition Law shall be followed.

34. In determining the publicly recognized business ethics, reference may be made to the following factors:
(1) specific industry practices in information network industry;
(2) industrial regulations or self-regulatory norms developed by industry associations or self-regulatory organizations according to the characteristics and competitive demands of the industry;
(3) technical standards in information network industry; and
(4) other contents that shall be referenced in determining the publicly recognized business ethics.

35. Where the defendant conducts any of the following acts through information network that is sufficient to impair the legitimate rights and interests of the plaintiff, disturb normal market operation order, violate the principle of fair competition, and violate the principle of good faith and publicly recognized business ethics, the said act may be deemed as an unfair competition act under Article 2 of the Anti-unfair Competition Law:
(1) without authorization and justified reasons, using the contents of a website that can increase transactional opportunities and competitive advantages for the plaintiff to an extent that is sufficient to substitute the consumers’ visit to the plaintiff’s original website;
(2) without authorization and justified reasons, using the plaintiff’s commercial signs other than those prescribed by Article 5 of the Anti-unfair Competition Law, which cause confusion among the consumers;
(3) without authorization and justified reasons, modifying the drop-down keywords in the plaintiff’s search bar, so as to directly affect the plaintiff’s transactional opportunities;
(4) without authorization and justified reasons, making use of the plaintiff’s website traffic to insert advertisements in the interface;
(5) without justified reasons, disrupting business activities of the plaintiff by way of interruption, impeding, or any other means;
(6) other circumstances as provided for in Article 2 of the Anti-unfair Competition Law.

36. Where the defendant conducts any of the following acts through information network that is sufficient to mislead the relevant public, the said act may be deemed as false advertising under Article 9, paragraph one of the Anti-unfair Competition Law:
(1) acting obviously contrary to the objective facts when publicizing the defendant and goods or services provided thereby;
(2) using expressions, such as “national”, “highest” or “best” when publicizing the defendant and goods or services provided thereby;
(3) using biased and false descriptions when introducing the defendant and goods or services provided thereby in comparison with the plaintiff and goods or services provided thereby;
(4) using the contents provided by others that are obviously groundless when publicizing and introducing the defendant and goods or services provided thereby; and
(5) other circumstances that constitute false advertising.

37. Where the defendant conducts any of the following acts through information network that is sufficient to damage the plaintiff’s commercial reputation or the reputation of goods, the said act may be deemed as commercial defamation under Article 14 of the Anti-unfair Competition Law:
(1) in the course of disclosing the plaintiff’s negative information, fabricating, misrepresenting and exaggerating the facts so as to mislead the relevant public into making negative comments about the plaintiff;
(2) in the course of disclosing the plaintiff’s negative information, although there is evidence proving that the information is objective and truthful, the information is disclosed in an obviously inappropriate way, which is sufficient to mislead the relevant public into making incorrect comments;
(3) encouraging or inducing network users to make negative comments about the plaintiff by language, bonus points, prizes, preferential services or other methods; and
(4) other circumstances that constitute commercial defamation.

38. In determining whether the defendant’s purchase and use of paid listing services constitute acts of unfair competition, the following factors may be taken into comprehensive consideration:
(1) whether the defendant, without authorization, uses the commercial signs of the plaintiff or his interested party which can identify the quality and source of goods or services as keywords for paid listing;
(2) whether there are justified reasons for using other’s commercial signs as keywords for paid listing;
(3) whether the keywords are contained in the titles and introduction of the website content revealed in the search-results list;
(4) whether the keywords are contained in the defendant’s web page accessible through search results; and
(5) whether the plaintiff’s transactional opportunities or competitive advantages may be changed to such an extent that the plaintiff’s legitimate rights and interests are impaired.

39. Paid listing services provided by the search engine service provider fall within the scope of information retrieval services.

40. Where the search engine service provider has not conducted the acts of selecting, classifying, recommending, and editing keywords in the course of paid listing services, the search engine service provider is not obliged to make a complete and active examination on keywords used for paid listing services, unless the keywords are obviously in violation of the laws and regulations.

Regarding unfair competition acts committed using paid listing services, the plaintiff has the right to notify the search engine service provider to take necessary measures to remove, block, and disconnect the website link.  Where the search engine service provider, upon receipt of the notification, fails to take necessary measures timely, the search engine service provider, together with the undertaking who has committed an unfair competition act, shall be held jointly and severally liable for the extended damages.

Where the search engine service provider knows that others have committed an unfair competition act by using paid listing services, but fails to take necessary measures, the search engine service provider shall be held jointly and severally liable.

41. In determining the liability of the defendant for damages according to Article 2 of the Anti-unfair Competition Law, the amount of damages shall be determined according to the plaintiff’s actual losses; where the plaintiff’s losses are difficult to ascertain, the damages may be determined according to the profits gained by the defendant.

If, pursuant to the preceding paragraph, the plaintiff’s actual losses suffered from the unfair competition act are difficult to ascertain, the plaintiff shall be required to prove the defendant’s profits; where the plaintiff has provided preliminary evidence proving the defendant’s profits, and the account books, materials, and back-end data concerning the unfair competition act are under the control of the defendant, the defendant may be ordered to provide such account books, materials, and back-end data; and where the defendant, without justified reasons, refuses to provide such account books, materials, and back-end data or provides false ones, the profits may be determined according to the claim of and the evidence provided by the plaintiff.

The defendant’s profits may be determined by taking into comprehensive consideration the duration and scope of the unfair competition act, website traffic, relevant advertisements or profits in other forms, etc.

42. Where the unfair competition act committed by the defendant through information network causes negative impacts on the plaintiff’s commercial reputation and reputation of goods, the defendant may be ordered to eliminate the negative impacts.

The manner to bear the liability for eliminating negative impacts shall conform to the circumstances, manner, duration and the extent of the adverse consequences of the unfair competition act.
 

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